by Pablo Arroyo | August 5, 2021
During the COVID-19 pandemic, small businesses had to face many challenges as they needed to respond and adapt swiftly to changing market conditions. Abrupt changes in demand, consumer behaviors and regulations made it necessary to re-think the traditional models and adapt systems and processes to confront a once in a century event, one that will certainly change the business landscape forever.
When analyzing this transformation that allowed most businesses to survive and some even thrive, we can identify the major elements that were determinant for success in this process. Some businesses were better equipped to survive this unprecedented challenge, while others were not. We should also note that while some businesses were inherently favored by the nature of the industry in which they operate, others were not as fortunate. For example, those in travel and tourism, hospitality, entertainment, apparel and restaurants were negatively affected. On the other hand, those in food and grocery retailing, technology and telecommunications and medical/healthcare fared well.
It is clear that one of the major elements that permitted businesses to deal with this unprecedented challenge is the adoption of technology and the establishment of effective internal processes. It is clear that businesses that had an established digital presence and methods to communicate with customers, suppliers and employees were able to adapt faster and minimize disruptions in their operations. This poses the following question:
What are the main technological tools and processes that business should have in place to deal effectively with this or any other future emergencies?
First, we must be proactive and not reactive. According to Euromonitor, in their report Innovating During Coronavirus in June 2020, 44 percent of companies created a business continuity plan in response to the pandemic and only 20 percent had a business continuity plan in place prior to the COVID-19 pandemic. About 19 percent of the companies were in the process of creating one or were planning to develop one and 5 percent did not have one and had no plans to develop one. This means that the great majority of companies were not proactive and did not have an established process to deal with emergencies.
Create a Disaster Plan Before You Need It
It is clear that no one could foresee a global pandemic halting business activity, however if you have already established processes to deal with unexpected situations, you will be better prepared to deal with it. Creating a continuity plan is in fact a critical factor in surviving an emergency. Now that we have the experience of COVID-19, we should not be caught off guard and should establish contingencies before any future global, regional, or local disaster threatens the continuity of our business operations.
In terms of the type of technologies critical for small businesses during the pandemic and in years to come, we know that the continuity of many operations during COVID-19 hinged on the adoption of appropriate technologies and systems in place. Market conditions pressed businesses to quickly adapt their models as we ended up with savvier consumers with new purchasing behaviors, which bring new opportunities for small businesses. The utilization of these technologies occurs at various levels, such as communicating with customers, suppliers and employees.
Being able to maintain a seamless and constant line communication with customers was critical as the lock-downs disrupted standard face-to-face interactions. For some businesses, this became a lifeline that allowed them to continue their operations. Service-type businesses, which typically involved face-to-face interaction with customers, faced the challenge of adapting or perishing. This was the case for restaurants, education firms, consulting services and routine medical services. However, in some instances, remote delivery was not an option and appropriate safety measures were put in place to continue operations.
It is estimated that customers have jumped five years ahead in technology adoption. For example, before COVID-19, we were not accustomed to regularly buying groceries online. Now, customers are used to buying online for curbside or home delivery. Retailers had to adjust their system to meet this new demand and this new behavior is here to stay. Customers have realized the efficiency and the time savings involved. So, we need to make sure we are reaching customers in every way possible and managing communications effectively.
Have an Established Customer Relationship Management (CRM) System in Place
To tackle this, a business must have an appropriate Customer Relationship Management (CRM) system in place. A CRM system allows a business to retain customers and maximize sales. By optimizing the customer experience and the interactions we have with our clients, we will be driving the growth of our business. All forms of contact with a customer will be captured into a CRM system, such as website, telephone, text, chat, direct mail or social media engagement. Other functions can be rolled into a CRM system such as human resource management, accounting/financial and data analytics. These CRM systems can be open source or proprietary platforms.
Diversify Your Supply Chain
In terms of suppliers, a key aspect that has arisen during COVID-19 is the vulnerability of the supply chain. Certainly, the ability of some suppliers to continue delivering products during the pandemic has been hampered by the availability of components/raw materials, labor shortages, logistics and financial aspects. One way to deal with this situation is by designing a resilient supply network, being proactive and collaborating whenever possible. If we diversify our list of suppliers, stay on top of changing restrictions/regulations and become a partner with that supplier, we can help mitigate these risks.
Maintain Communication with Remote Employees
With regard to employees, it is evident that the ability to continue communicating and supervising employees remotely during COVID-19 was critical. Videoconferencing technology is a must that we have learned one way or another during the pandemic. This is complemented by technologies that allow tracking of time and work performed with the ability to interface with other business systems. We can have a basic time and attendance system that tracks time and interfaces with payroll and/or HR software. Or we can have a more complex CRM system that can serve as a way to engage with customers and also a way to track activity and performance of employees. These systems can also be used for project management and integrated with artificial intelligence capabilities. They can be cloud based or on-premises.
Lastly, as the level of technological sophistication and complexity increases, so does the level of cybersecurity measures we need to put in place. A cybersecurity plan is a critical component of any resiliency plan and needs to assess the current risk exposure, effectively manage risk and respond to incidents appropriately.
COVID-19 was and still is an unprecedented disruption that threatens the continuity of our businesses and is certainly not the only challenge that we will have to face. With this in mind, as business owners, we need to make sure we have the appropriate technologies and processes in place so that we can adapt and modify our business models. In the business world, change is constant and the way in which we respond effectively to changing market conditions and continue a seamless communication with customers, employees and suppliers will determine the success of our operations.