For years, videoconferencing providers enjoyed steady growth by focusing on corporate customers. Even museums are creating and streaming digital content to enable people to enjoy their offerings from the comfort and safety of home (for instance, Getty’s “life Imitating art” challenge). Similarly, the entertainment industry is generating new content (for example, sports retrospectives) to fill the void in programming created by the suspension in sports leagues. Food distributors that traditionally supplied restaurants are setting up digital direct-to-consumer channels as the crisis decimated their core restaurant sales. In this digital sales sphere, smaller firms can often “match up” to even their biggest competitors. Sales coverage has been completely redefined as companies discover that virtual technology allows them to do things that were nearly impossible previously, such as assembling the “perfect team” of experts for every sales pitch. According to McKinsey’s B2B Decision-Maker Pulse survey, 96 percent of businesses have changed their go-to-market model since the pandemic hit, with the overwhelming majority turning to multiple forms of digital engagement with customers. Firms with significant field forces can no longer rely on in-person coverage to outcompete. Sudden pivots observed during the COVID-19 pandemic include: While the rise of digital has been mounting similar pressures for more than a decade, the current crisis has significantly exacerbated and accelerated its disruptive force. The assumptions that supported years of stable, predictable growth may no longer be valid.Ĭompetitive advantages shift dynamically as business models adapt to new market realities, and the core capabilities that made an organization distinctive may suddenly be less differentiating. A stable regulatory context may have changed, potentially creating opportunities that never existed before. Channels may have radically shifted to accommodate new needs or work around new constraints. What made a company successful historically may no longer be possible during or after the crisis. Many businesses simply cannot operate as they have in the past. building the foundation for postcrisis growth in order to remain competitive in the recovery period.reevaluating the innovation initiative portfolio and ensuring resources are allocated appropriately.identifying and quickly addressing new opportunity areas being created by the changing landscape.adapting the core to meet shifting customer needs.Our survey and subsequent interviews with business leaders tell us that many companies are deprioritizing innovation to concentrate on four things: shoring up their core business, pursuing known opportunity spaces, conserving cash and minimizing risk, and waiting until “there is more clarity.” However, we believe that, particularly in times of crisis more urgent actions to take include: Our research suggests that playing it safe may be a shortsighted decision right now. Leaders face an important choice around supporting innovation-led growth in the short term, one that may have lasting consequences for their companies’ ability to grow in the years to come.
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