By Charles Ferguson
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As the first region to tackle the Covid-19 outbreak and as the forerunner of economic recovery, the Asia-Pacific (APAC) region has the world’s full attention as it tests the resiliency of its business and industrial fabric, setting the course for the future.
Forming a post-Covid-19 business plan
Due to the accelerated ripple effects of the pandemic, many APAC corporations have dramatically re-engineered their business models at an equally dynamic pace. These companies were already looking at ways to inject added competitiveness and resiliency to their models and Covid-19 expedited that process. The lack of infrastructure and resources to quickly adapt to the market’s dynamic shifts calls for leadership to step in with a more hands-on approach to their business strategies. They needed leadership to not only help them out of the Covid-19 storm, but also prepare their readiness to compete in the emerging economies.
According to The Economist Intelligence Unit’s Asia Pacific CEO Survey, 43 percent of participating companies had developed a post-Covid-19 business plan by July-August 2020 and had altered operations, 24 percent had plans but had not yet started implementing. The virus set off a structural change among Asian economies, prompting resource reallocation toward new growth areas that have showcased their ability to thrive during uncertainty.
The Economist Intelligence Unit also reported that Covid-19 is also at the origin of shifting demand and preferences on the consumer side, and businesses must readjust. A roadmap is vital going forward and in Asia-Pacific, there are three critical areas of focus: adaptability, innovation, and sustainability.
Adaptability: the new cog in a successful operating model
Industries that rely heavily on overseas supply chains are choosing to reshore them to avoid exogenous supply chain disruptions. The Economist Intelligence Unit survey highlights how decades-old reliance on lean manufacturing and just-in-time models are being overtaken by resilience and responsiveness. Fifty-seven percent of the firms surveyed indicated having begun to onshore supply and/or manufacturing to secure critical provisions for their business, while 67 percent expect to continue in this direction in the future.
On the talent front, as companies transitioned from remote by necessity to remote by choice, a wide array of work configurations was made available. A “hybrid” workforce can boost productivity when KPIs measure output over time spent working. According to The Economist Intelligence Unit, 42 percent of companies are now looking to hire more contract workers, while a permanent increase in home officing has become a viable option for 76 percent of respondents. This opens the door for leaders to let their workforce decide. Employees can choose a permanent remote setup or a mix of home and office work to suit their roles and personalities.A “hybrid” workforce can boost productivity when KPIs measure output over time spent working. Click To Tweet
According to Bloomberg, Asia Pacific’s top remote work challenges include:
- Team communications and collaboration (42 percent)
- Staying motivated and engaged (41 percent)
- Time management (39 percent)
If leaders can find solutions for these challenges, operations could take place anywhere in the world. Long-term projections reflected in The Economist Intelligence Unit survey reveal that to make the remote operating model efficient, 69 percent of respondents will be instigating training programs to address these challenges.
Innovation: digital initiatives in the fast lane
Corporate leadership needs to provide the necessary tools for their business models to remain relevant in the unprecedented push toward digitalization, cloud use, and e-commerce.
While 64 percent of CEOs in Asia Pacific reported having suspended or cancelled investments during the crisis, 77 percent have increased their companies’ adoption of new technologies and expect their technology investments to continue increasing, according to The Economist Intelligence Unit survey.
Online companies unsurprisingly excelled during the pandemic. As the survey states, “It is less about being first to market and more about fastest to scale.” Companies surveyed revealed that digital technology not only kept the workforce connected, but also created new commercial channels for products and services as well as improved the development of new products or services. Digitally savvy companies, therefore, improved their offering and secured new business.
Sustainability: the future of APAC business
While the ongoing pandemic could have easily distracted attention from corporate Environmental, Social and Governance (ESG) investment criteria, corporate leadership in Asia Pacific kept this top-of-mind. Seventy-two percent of the CEOs surveyed by the Economist Intelligence Unit said they increased their focus on ESG in the second half of 2020. Bloomberg’s survey echoes this sentiment, with more than 7 in 10 decision makers stating that Covid-19 bolstered the importance of environmental protection.
Boston Consulting Group’s Environmental Awareness Survey found Covid-19 has acted as a wake-up call for consumers. Out of the 3,249 participants across the globe, 76 percent think environmental issues are as concerning or more so than health issues. CEOs are getting ready for the future by listening closely to consumer’s voices.
Adaptability, innovation, and sustainability working together as a cohesive unit will pave the way for future business growth and resiliency going forward.
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