Developing the right strategy
Leaders must enter the new year with their eyes on the immediate risks while realizing a vision for accelerated transformation.
1. Brace for impact
The risks posed by COVID-19 persist. Although at the time of writing, vaccine trials are delivering promising results, 2021 will demand cautious navigation of the challenges and impact of the crisis. Our key advice for operating during a pandemic, what issues companies need to look at, and how to keep the lights on, will remain as valuable in the coming months as it was when the crisis first emerged.
Read more: COVID-19 and pandemic planning: How companies should respond
2. Plan for continuity
Operating in the era of COVID-19 hasn’t just meant the quick deployment of survival mechanisms, like getting home-working capabilities in place. It’s required taking steps to ensure true, long-term business continuity. We identified nine key areas of concern for companies looking to establish business continuity – ranging from employee health and wellbeing to insurance and legal disputes – and developed a convenient tool to help you understand the resilience of your enterprise and prioritize your actions.
Read more: Enterprise resilience: Nine areas of focus to reframe your future
3. Identify your critical dependencies
The economic recovery from COVID-19 will likely be bumpy, with saw-tooth growth and profound changes to old ways of doing things. It can’t be business-as-usual. Leaders need to know which components essential for business continuity will face significant disruption – from your workforce to your logistics frameworks or customer base – and decide which of these capabilities needs to change permanently.
Read more: COVID-19: Which critical choices should businesses make next?
4. Accelerate digital transformation
Digital transformation isn’t going away, and companies need to be ready for it. Executives know this: 62% of respondents to our 2020 Digital Investment Index survey said it was critical to transform their organizations over the next two years. Yet just 2% believe they are fully utilizing the benefits of digitizing core processes. We break down the benefits, and look at six key actions leaders can take to push their organizations towards a successfully digitized future.
Read more: Will your digital investment strategy go from virtual to reality?
5. Put humans at the center of digital transformation
Of course, there’s no such thing as digital transformation for its own sake. Transformation needs to be driven by people, and needs to ultimately serve people – whether they’re employees, consumers, or the inhabitants of the wider communities in which businesses operate. It’s your people who will help you recover and grow in the coming months and years, and your human stakeholders who will impact your decisions and success. That’s why we call the smartest and most agile and innovative businesses Human Enterprises – organizations that put human needs and goals at the heart of their transformation and growth strategies.
Read more: Why successful digital transformations start with the Human Enterprise
6. Position yourself for growth
If 2021 is to be a year of rebuilding after the profound disruption of COVID-19, then it is important that organizations effectively position themselves for growth in the world beyond the pandemic. That’s where the Lens for Better framework comes in, helping executives consider aspects and effects of growth strategies across key areas, including public health, connectivity, and innovation and ingenuity – and deliver long-term value for all stakeholders.
Read more: The CEO Imperative: How has adversity become a springboard to growth?
7. Don’t aim to return to normal, reframe what normal should be
Yet, with all this said and done, the world is finally moving into the reconstructive phase of the pandemic. This could end up fundamentally redrawing some of the basic assumptions of our commercial and political (and private) lives. If business leaders want a hand in defining that new normal, they need to understand what’s at stake – and the strategic decisions they need to make now.
Read more: Beyond COVID-19: Will you define the new normal or watch it unfold?
Refining your operations
Executing with both speed and flexibility has become more important than ever.
8. Reshape your C-suite
Redesigning growth strategies for a post-COVID-19 world means reconsidering the capabilities of your C-suite. What new skills are required? Will current sizes, composition and governance structures help or hinder C-suites in achieving the necessary agility to navigate the rebuilt business landscape of 2021? And how will they continue to pursue strategies that maximize benefit for all stakeholders?
Read more: How to reshape the C-suite for a better working world
9. Become a trusted organization
New ways of working in 2021 will be heavily reliant on data and digital technologies. The trust needed to hand our lives over to the care of sophisticated algorithms will be a critical currency in the new digital age. Trust will be central to effective use of these technologies – whether it’s a consumer using online banking, or an office using automated compliance software. Organizations that can put this trust at the heart of their operations can be the new disruptors.
Read more: Are you moving at the speed of trust?
10. Question your information
Today’s businesses float on an ocean of data. This can be extremely valuable for businesses who can establish trust in that data. However, 61% of respondents to the 2020 Edelman Trust Barometer indicated they felt the pace of change in technology was too fast. An alarming 66% of respondents worried technology will make it impossible for people to know if what they are seeing is real. Do you know if the data you’re using are the right ones?
Read more: How to harness the power of trust and data
11. Digitalize your supply chains
While the panic it provoked was short-lived, the rush on toilet paper across the world in the early days of the pandemic was a graphic illustration of the fragility of supply chains. Building supply chains providing the necessary resilience, flexibility and sustainability means widely embracing digital solutions. Here’s a deeper look at four imperatives we’ve identified for developing truly digital supply chains: intelligence, architecture, operational excellence and planning.
Read more: Are you running an analogue supply chain for a digital economy?
12. Deploy technology at speed
Agility was essential in 2020, and will be in the years to come. Here’s how businesses can embrace a technology-at-speed approach to digital innovation, using data and cybersecurity measures within an effective human-centered framework to supercharge transformational growth.
Read more: How can technology at speed create competitive advantage?
13. Transform your HR function
Next year will require agile new business strategies and new ways of using data and technology. But effective execution of any strategic imperative, at any scale that matters, means creating a workforce of similarly agile and adaptable employees. That requires a HR function that itself is transformed in a way appropriate for the demands of a thriving Human Enterprise. We identified the steps HR functions can take to achieve this, from embracing digital solutions, to practical ways of breaking down organizational silos.
Read more: Will HR transformation be the thread that ties value to experiences?
14. Keep an eye on political exposures
Global geopolitical risk hit a post-World War II high in 2020. This was chiefly driven by the impact of COVID-19 – which the EY Geostrategic Business Group believes will remain the number one risk moving in 2021, as longer term regulatory, economic and logistical impacts make themselves felt. But that’s not all: climate change and sustainability, social justice, and governance issues are all likely to be major political risks for organizations going forward. Here’s a deeper dive.
Read more: What elevated levels of politic risk mean for business in 2021
Reframing your future
Combining people, technology, innovation and strategy will be key to delivering long-term value.
15. Know your customers
The customer is always right, right? It’s a business truism. But it’s also something that needs periodic revaluation. Increasingly today’s customers – sustainability minded and digitally fluent – may not know exactly what they want, but they expect brands to anticipate their needs and deliver against them with frictionless, personalized experiences. We’ve identified three core demands from consumers in 2021: make my life easier, make it feel better, and make it more fulfilling. Retailers need to tailor their value proposition to best serve their customers – and other sectors do too.
Read more: Three I’s that could reframe the future of retail
16. Become a human-focused leader
Organizations that will thrive in the years of reconstruction from 2021 and beyond will be those demonstrating leadership in technology and transformation. We broke down six vital habits of organizations leading the way in creating value through technology adoption, from learning to drive innovation through the strategic use of ecosystems and partnerships, to using the right incentives and strategies to nurture the talent you need to make your business grow.
Read more: The CIO Imperative: Is your technology moving fast enough to realize your ambitions?
17. Invest in your people
COVID-19 was a human-borne disease, not a business-borne one. Balance sheets don’t get ill, human beings do. But organizations loyal to their people see long-term benefits. And, ultimately, it’s human workforces that are at the heart of driving an effective recovery from the pandemic. Investing in your workforce helps create a business more capable of adapting and innovating to whatever comes next.
18. Remember your purpose
Despite COVID-19’s year-long domination of news cycles, other systemic problems have not gone away. Inequality, gender and racial disparity, poverty, hunger and climate change all remain pressing problems – and 67% of CEOs feel moderate to extreme pressure from stakeholders to address these issues. Here are four pillars to help your organization translate its ambition on corporate purpose into action, and drive positive change in 2021 and beyond.
Read more: Four ways to put your purpose to work
19. Beware of bad behaviors
The global pandemic has exacerbated the problem of unethical behavior. When surveyed at the height of the pandemic, 90% of businesses reported they believed COVID-19 posed a risk to ethical conduct. Combining this risk with increased levels of scrutiny from wider society means companies must take action to ensure they navigate their way through the pandemic – and its aftermath – with integrity.
Read more: Is this the moment of truth for corporate integrity?
20. Refocus on sustainability
Governmental responses to the pandemic – from lockdowns to financial aid – have constituted a major political variable for companies over the past year. These factors will continue to have relevance as governments around the world work to rebuild in the wake of the crisis. We explored what is being done by governments to build a more equitable and more sustainable world in 2021, and how organizations can and should engage with these efforts.
Read more: Will the road to recovery lead to an economy that’s revived or reimagined?
21. Reframe your future
COVID-19 brought trends that seemed far away right into the present, transforming old ways of working and redefining patterns of business growth. The EY megatrends report provides information on these macro-scale transformations in technology, society, and the economy, advising how leaders can uncover previously unseen opportunities to define the future – rather than be made obsolete by it.
Read more: Are you reframing your future or is the future reframing you?
Ask the right questions, now
The transformative twenties began with an unforeseen event that catalyzed changes none of us could have imagined a year ago. Doubtless more unknown, unpredictable events will present themselves in 2021. And perfect responses to the known imperatives outlined above may yet elude us. But by asking the right questions now, and designing future-back transformation plans that bolster resilience while enabling the agility to deal with what’s next, we believe leaders can prepare with confidence today for the unknown opportunities of tomorrow and beyond.
So, in 2021, what new questions will you ask to reframe your organization’s future, and help us all build a better working world?
This has been a truly remarkable year. The global pandemic has loomed large, but so have economic instability, civil unrest, and radical workplace transformation. Companies going into 2021 will need to take heed of the substantial changes the last year has brought, and understand how to unlock recovery and growth as uncertainty continues.