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The coronavirus may not last forever, but it will have a lasting effect on all of us. Every sector is impacted, and what makes it worse is that no one knows when this will end, how bad it will be or what happens next.
Businesses are no longer operating as usual for anyone. Millions are quarantined and working from home, while many have lost their jobs. Nonessential businesses have closed their doors indefinitely, the market is down, borders have closed and movement of good has slowed down, affecting the global supply chain. Everyone is in crisis mode and will be economically affected in the coming days, weeks, months and even years. Some industries are already on the brink of collapse.
Understandably, every CEO of every startup, small business and corporation is concerned about their future, however even as bad as things are, this is no time for panic. This is the time to start thinking radically different about how we do business.
If businesses are to survive, business owners must ask themselves, how can we adapt to the changing circumstances and serve our customers as life changes for us all?
This is an unprecedented time for everyone. Everything you knew about your market, industry, customer needs, supply chain or revenue model does not apply in the current market state. In a time of uncertainties, CEOs must revisit their business model and reconsider every aspect of their business to continue to drive value amid distress and changing times.
Revisit Your Business Model
We are deep into the pandemic, but most businesses are scrambling to catch up with all the dramatic changes caused by the virus. Whether you are a startup, small business or corporation, the business model that was working for you before the crisis is no longer valid. CEOs must think outside the box and rapidly adapt in times of uncertainties and change.
Business Model Innovation During Crisis
Turn every element of your business model upside down and gain new perspectives. Ask yourself what-if questions. Go wild. Be as creative as possible, and think differently about your existing business.
Key Partners
Consider your key partners and ask yourself how your partnership has been impacted by the crisis? Are you able to continue working with them in any capacity? What role do they play? Reach out to key partners and discuss long and short term plans and opportunities. Do not be afraid to think outside the box and form new partnerships where it makes sense.
Key Activities
Think about the key activities you need to focus on right now. Look at activities related to distribution and operations. What kind of modifications are needed? How has your supply chain been impacted, and how do you need to adapt? If you are dependent on goods coming from abroad, consider how trade and movement of goods will be affected moving forward. Do you need to find alternative suppliers locally? Do you need to create a new product, add a new feature or update your product roadmap to drive value? If you are not digital or have any form of an online presence, this is the time to change that.
Value Proposition
Do not assume what you thought you knew about your target groups is still relevant. To continue to create real value in times of change, conduct user research, and define your new value proposition. If you are B2C understand how customer spending habits have changed, what needs do they have as they settle into the new normal? How can you create value and make life easier for them?
Are older people a part of your customer group? The elders and the sick in our communities will be affected in more ways than most and will have different needs during and post-corona. Reevaluate what user needs you will have to prioritize.
Customer Relation
How has customer relationships with your target group changed? Do customers have new expectations from you? In the face of uncertainties, customers seek consistent and open communication. They will look for clarity. They will have many questions as the situation develops. Create a customer journey and determine how often and how you should communicate with your users, both online and offline. It is also essential to understand how your new customer relation strategy will impact cost and resource structure.
You must understand your users and empathize with them in these trying times. What are their needs, worries and motivations? Once you know your customers, group them based on common characteristics. Your new customer segment may look different from your old one. How has it changed? Can you expand the user group?
Key Resources
What key resources does your new value proposition require? Do you have the support you need to implement the new business model? Prioritize how you allocate your resources. What will give you the most impact and help you reach your goal? Allocate your resources efficiently and consider to be sparse as you don’t know how long you will have to weather the storm.
Distribution
Distribution is a significant challenge for a lot of companies. As millions are locked in their homes, borders are closed and travel is limited, businesses need to rethink how to reach their customers. What services and products are required to get to users? How will the virus impact local and global distribution? What distribution channels will be available, and what will it cost you? How does this change your value proposition?
Cost Structure
Gain strategic context of your cost structure. Stay up to speed on every detail of your companies financials. What are your current expenses? How much is your burn rate? Could you cut back? Are you losing money right now or making a profit? What are sales looking like? How long is your runway? By closely monitoring the financials, you will get a better understanding of how long you can operate before you run out of money. Can you afford to ride it out, or will you have to make some drastic changes to survive?
Revenue Streams
The pandemic is having a substantial economic impact on millions of people, and it will continue to get worse as time goes and governments continue to implement extreme measures to stop the spreading. Has the value your customers are willing to pay for your product or services changed? Do you have to modify revenue streams? Are there any opportunities for new revenue streams?
The coronavirus has disrupted our daily lives forever, forcing every business to innovate at a rapid rate. Most governments have not had to implement such drastic measures since the second world war. The world is essentially on time out until further notice. We do not know how long this will last or how bad the consequences will be. Those who take action today and continue to maintain agile and adaptable will have a bigger chance of surviving. The longer the crisis lasts, the more drastic changes you need to consider.
