A New Tipping Point: Capitalizing on Opportunities During COVID-19

Early in the COVID-19 lockdown, RGP VP Ron Rod, who leads our Supply Chain as well as Technology and Digital practice areas, wrote that the pandemic could be a tipping point — not only for businesses but also for individuals — to change their mindset and behavior. In his article, Ron wrote that COVID-19 may be the catalyst for transformative change and that some companies and individuals would never operate the same post-pandemic.

As we approach the two-year anniversary of the first US lockdowns, we talked with Ron about what we’ve seen so far, where we might be going, and how it might influence strategy and planning today.

In spring of 2020 you wrote that the pandemic could be a tipping point for business leaders to change their mindset and behavior. How did that play out?

I think we’ve actually passed the tipping point. Digital transformation has become top of mind for most CEOs. If you read their reports and listen to their investor presentations, nearly all are talking about the use of digital, how efficient they’ve been, how they’ve transformed the workplace to support a virtual work environment. We’ve seen some companies that have tried to come back to the office, and their workers didn’t want to come back. Many of them want to work remotely 100% or at least 50% of the time.

“Instead of struggling to survive or battening down the hatches, some companies approached the pandemic as an opportunity to change their business model.”

Ron Rod, Head of Supply Chain and Technology & Digital

Finally, from an agility standpoint, we had to get to think about how we can operate in a different environment. There are still some laggards that are saying, “You know, I don’t want to do this.” But I think maybe 75% of organizations have said, “This changed our business.”

So this pandemic most certainly was a tipping point by the true definition as an event that triggered a different way of doing business.

Digital transformation has accelerated, but at the same time, many companies are still behind on key initiatives, such as migrating to a cloud-based ERP. Why is that?

I think there are two categories of technology initiatives and digital transformation. There are the operational aspects that are just required to run the business — purchase orders, how you run manufacturing, how you run distribution, and how you record your financials. That part of the business didn’t really have the burning platform for change. So those projects have decelerated to preserve capital and better leverage current resources.

Then, there are the collaboration-based solutions that allow people to work together. And this is where we’ve seen much more acceleration.

Many of these take advantage of cloud-based solutions. Naturally, the technology and digital transformation roadmaps still include the ERP and transactional technology implementations. In fact, most are really taking more of an integrated roadmap that looks at all work streams both within the company and outside the company to its suppliers and customers.

Some companies, like Zoom, which were thriving early in the pandemic, are now struggling. Why is that and how can organizations build more sustainable success?

Those were unique technologies — one-time implementations and platform stand-ups — which were a byproduct of what happened with COVID. Most of those were simply better technologies for the user experience and replaced WebEx, Skype and other outdated technologies.

What we should not miss is that the culture has changed, and people have grown very comfortable working in a virtual environment. The adoption of technologies like video conferencing is so ingrained now — it’s just a way of doing our day-to-day business rather than an occasional fallback when people can’t meet face-to-face. And that’s allowed other companies besides Zoom to just take it over.

The longer-term impact goes beyond the fluctuations of any individual company’s stock prices. The technologies that enable virtual work have been rapidly and broadly adopted by so many organizations, who recognize them as a business differentiator and have realized the value of lower operating costs, better use of time and real-time decision-making.

Were there any outcomes over the last couple of years that surprised you that you didn’t see coming?

I’m surprised by the number of organizations that have gone all-in on the new ways of working — not just among younger employees but across generations. When we first went into this, we thought there might be just a short-term impact and organizations would go back to the norm very quickly. They’d still have their offices because that’s what management wanted, even if workers didn’t.

But a lot of managers have also embraced this new way of working. They’ve seen that they can trust people working from home. They see how their people are able to adapt their lifestyles and get more work-life balance—and keep them employed.

87% of employees would prefer to stay remote at least half of the time, even after it’s safe to return to their workplace.

LinkedIn Survey

One of the top challenges or concerns we’re hearing about is the “Great Resignation.” What’s your take on the talent piece of this?

The Great Resignation is so real. People are using this period to reevaluate their lives: Are they happy in the way they work? Are they happy with the way they had to commute? How did they feel when they were forced into working from home and their work-life balance changed? When COVID hit, we were forced to change our lifestyles — and we suddenly understood that you could be so much more efficient by working in the manner that we do now.

At the same time, we’ve also missed some of the face-to-face interaction. We still want to have that and haven’t yet figured out how to bridge that gap. But it caused a lot of people to start looking and questioning: “What else could I be doing with my life — could I find something different? Is there another company that would allow me to have the work style and the lifestyle that I really want?” Then finally, “Will my company adapt to this change?”

What are you hearing from clients about their current challenges and priorities?

I think too many companies are still focused on returning to work as it was before — thinking that things are going to go back to normal, instead of asking, “What is our vision? What’s our strategy for the new way of work? What do I need to do to really embrace people who have changed?”

Of course, not all companies can do everything virtually — those that run warehouses, distribution centers or manufacturing. They’ve struggled and have not been able to figure out how to get through this pandemic. They have, however, realized that many traditional on-site functions can occur off-site with resources that can be leveraged across facilities.

Rather than trying to figure out how to bring people back to work the way we used to, organizations should focus on their strategy. Is this the right business model? And do I have the right people who will work in this new manner? It needs to be more of a business strategy discussion about what we need to work going forward.

Is This Your Cliff or Launchpad?

That’s the question Ron posed back in 2020, advising that we should all be continuously evaluating our business operations, paradigms and personal work style:

• If this pandemic ended today, would you or your company simply return to business as usual? Or will you use this as an opportunity to capitalize on those things that allowed you to survive?
• Will you embrace the benefits of technology?
• Will you break the paradigm that work groups need to sit next to each other to be efficient?
• Have you supported the cultural transformation required?
• Will you build on the agility aspects that your organization was able to demonstrate (even if it was out of necessity)?

We explored those topics in depth with a select group of business leaders in our research study, Human Agility in the Now of Work. Dig into our findings to see how organizations can successfully rise above the obstacles presented by disruption and realize the benefits.