Since the outbreak of COVID-19 and its rapid spreading around the world, companies have been under pressure to reconsider ways of working and to adapt the existing relationship between employers and employees. An almost-instantaneous change had to happen and new ways of working that were far beyond implementation in our day-to-day lives are now dominant.
The pandemic we now face has put unprecedented pressure on organisations, forcing them to rethink their business model. The traditional management model in place in the majority of companies no longer fits the moment we are facing so acting on unpredictability is imperative.
Although digital transformation has been in every companies’ agenda for several years, most companies have started to digitally transform their business as they looked at automated working practices to optimize processes and be more productive. Digital acceleration [no longer digital transformation], achieved through this almost instantaneous change in behaviour, both in the workplace and in our daily lives, presents itself as an opportunity for those organisations that thought that "until now digital transformation was an option. Now is the only solution" says Rui Coutinho, Porto Business School’s Executive Director for Innovation and Growth.
“This is a wake-up call for organizations that put too much focus on daily operations at the expense of investing in digital business and long-term resilience” says Rui Coutinho. The companies that saw the digital transformation as a hypothesis are perhaps the most affected in this whole process, since they were exposed to the impetuous speed of events, seeing in three months changes that could take years to unfold.
For Sílvio Meira, “this thing of digitalization/computerization has been happening for 50 years. It started in the 80’s, with the electronic documents in the digital private networks (…) and right now [2020’s] we are starting to see economies or ecosystems of platforms rising. For most people that were paying attention to what was happening, this transformation happened in fact, in the last 5 decades. But for a number of people, they happened all of the sudden, in 5 weeks."
“The key take away of this happening?" – a lot of companies that weren’t prepared for digital started to adapt for digital.”. On Sílvio Meira’s terminology, the process of digitalization goes in three steps, from adaptation to evolution and transformation:
1. Adaptation: you adapt to digital tools that will allow your company to survive under digital stress;
2. Evolution: you start changing the business core, digital practices, mottos, your offer, the value you create and capture to digital.
3.Transformation: change the entire behavior of your company, your platforms your ecosystem to digital.
“The acceleration you are seeing now is because for most people, these five decades are happening right now, in five, ten weeks or three months. A lot of people will feel that they’ve missed a lot. A lot of businesses are going to fail completely. And not because of COVID -19, but because they are not going to adapt fast enough. That’s a big problem in companies that can’t work in a decentralized, distributed way.
Companies that are now entering digital competitiveness need to understand that this transformation cannot only be present in the way we sell products/services. It needs to go deeper and encompass the organisation as a whole. However, for this to happen, digital change cannot only impact the IT department, it needs to be present in all departments and all employees. Digital acceleration will transform the organisation and create: new ways of working, new KPIs, new ways of looking at the customer, new technology/platform systems and new regulations.
Many of the changes implemented now will remain in a post Coronavirus world. For Sílvio Meira, it is still hard to imagine how personal interactions will unfold. Will we again have large crowds of people at conferences like the Web Summit? Will online classes be a preference over face-to-face classes? Only time will tell.
One thing is for sure, the virtual space will become the new normal, where people will learn to operate and thrive. "But then, the most important "currency" we need to have in this virtual world becomes trust. Something that we've been seing in the last 10-15 years with the sharing economy.", says Rui Coutinho.
But at the same time we understand that trust is also fundamental when it comes to the technology we use leverage this new virtual world. To build a viable system of trustful relationships, besides good security there are other aspects of trust that need to be incorporated, including transparency and accountability. These values have to underpin any system aiming to foster long-term, sustainable trust in the business models.
In a world where physical contact is scarce and face-to-face business is minimal, the most important thing is to know that we can trust each other.
