A quarter of European companies are set to thrive in the post-COVID economy, while another 35% will survive, 300 CIOs across the UK, France and Germany say.
New research from Adobe and the London School of Economics (LSE) has revealed that there are now three main types of business, defined by how they are approaching digital transformation post-pandemic: Thrivers, Hiders, and Survivors.
Thrivers – which make up 25% of brands – represent the most successful category. During the pandemic, they increased digital investment, changedorganisational structures, adjusted business processes to get products and services to market faster, and reported a 20% increase in employee productivity – citing an increased focus on employee well-being and the ability to work remotely as key drivers of this uplift. This resulted in Thrivers reporting a lower revenue impact during the pandemic when compared to Survivors and Hiders, with 45% experiencing a revenue drop, at an average decrease of 15%.
Hiders – 40% of brands – meanwhile reduced technology and innovation spend during 2020, but maintained enough investment to remain competitive in the short-term, ultimately emerging in ‘status quo’ position. Two-thirds (66%) of Hiders suffered a revenue drop, with an average decrease of 35%.
Survivors – 35% of brands – got by on the bare minimum, making the most dramatic and ‘reactionary’ spending cuts during the pandemic, while their leadership is the most cautious and also disconnected from day-to-day business activity and customer interaction. They suffered the largest financial impact, with 70% experiencing a revenue drop, at an average reduction of 50%.
“The financial impact of the COVID-19 pandemic was far-reaching and widespread,” said Dr. Alexander Grous, London School of Economics. “By taking a more proactive digital approach in responding to the pandemic and adopting progressive leadership traits, Thriver organisations were clearly able to offset downward pressure on revenue, while also putting themselves in the best possible position for future business success.”
Leadership revealed as primary barrier to success during pandemic
Of the businesses surveyed, over half (55%) saw senior management decision-making, internal buy-in and a lack of digital strategy as their biggest barriers to digital transformation during the pandemic. This was followed by increased cybersecurity security concerns (45%), and worries over the complexity and compatibility of legacy systems (40%). In terms of what was the top driver of digital transformation, 90% believed that the Cloud was the key enabler.
Traits that will ensure leaders thrive during New Era In Experience
By identifying the key digitalisation trends and management practices for the business archetypes during the pandemic, the research also revealed the shared characteristics of leaders within Thriver brands.
These traits act as a blueprint for those companies Surviving or Hiding to prosper when society and the economy begin to re-open. Thriver leaders are found to be:
- Hands-on and open to change:The New Era requires a new breed of leadership that is visible, accountable, adaptable and invests in innovation.
- Build organisational culture around trust: The New Era has transformed the employer and employee relationship into a culture now built on trust, empowerment, and autonomy.
- Adopt rapid decision-making: The New Era is fast-paced and unpredictable – every part of the business must work together, in real-time, to meet customer needs, and be ready to adapt to whatever change may come next.
- Enable continual learning/upskilling:The New Era is constantly evolving and requires that those who succeed must constantly evolve too – businesses must continually look at new ways to enable their people to best meet their customers’ needs with the skills required to do so.
“The world has changed and business leaders need to embrace transparency, trust and agility to ensure they thrive in this New Era In Experience,” says Paul Robson, President, International at Adobe. “Digital has become the way for people to connect, work, learn and be entertained. Every business has now become a digital business and the ability to deliver best-in-class customer experience has never been so important.”