So, this is the third instalment in the economic analysis outline that I’m developing.
The reason that I continue producing it for everyone to read is because I know that the previous instalments worked.
Not only did we see a huge economic trough, followed by an intense economic upswing, but – in our own case – the business management measures we put forward actually worked.
Long story short, this is a period where we observed – in this order – a drop in our commercial leads by a factor of 2, followed by an increase by a factor of 4. In the end, in June, we had twice as many leads on our freelancing services (for example) as we had in January or February, along with a good 30% increase in outsourcing. Despite this unprecedented period, the number of new customers per month is therefore also increasing, by about 20%. On the other hand, these are small budgets – except for one Austrian case, which jumped straight to the million-mark.
The marketing measures that we took in phase 2 and maintained in phase 3 continue to respond to the interest of the players who are coming back to the market.
So, our advice is: keep it up. As vigilance relaxes, the new clusters that will open everywhere over the summer will constitute opportunities for communication, and points of attention for initiating conversations with your customers and partners to prepare for the future:
- Help them prepare for new risks – think about new distributions with them.
- In your offering, include the services that you redesigned and adapted around other customers.
- Share the innovations that you’re working on.
- Prepare your supplies: health-related, of course, but if you can find it, you should also buy computer equipment in advance.
This is not cynicism. It is rather a fierce resolve to help your organization survive by helping your ecosystem!
The great fear will return by the end of the summer (phase 4 – Déjà Vu) but no one will accept the idea that we should relive the same shocks.
The violence of the Fall-Winter wave will be anticipated better, and many companies will probably give up going back to their offices in September. In the countries where we have conducted surveys, between 75% and 90% of professionals in engineering are refusing exactly that. In Paris, some renters are already transforming offices into apartments. All this has already begun.
In short, it is through this “non-resumption” or more precisely, this non-resumption of the office, that telework will become the definitive reality.
Some amazing things stand out: drastically lowered CO2 emissions, much more productive use of individual time (instead of commuting time, how about extra training, or sports, or…?), lower automobile production, with fewer service station employees, fewer bus drivers, fewer taxis, and more Uber … millions of jobs all over the world are going to go up in smoke. We need to think about this and fast.
A terrible winter – Christmas in lockdown – 100% e-commerce.
I do not believe department stores will reopen this year – everything will go over to online. Creative e-commerce professions are mushrooming in China and the US. Your kids get their picture taken with Santa Claus – using an app… and you get store vouchers!
We can identify a huge number of new trends that go along with this. Like – we’re entering an era of e-retailtainment!
While this trial period will, no doubt, be grim, you need to get some perspective on the measures that you are going to take, because a lasting thinning will come at the end of Spring, and could connect with the vaccine. Slowly, between Summer in the northern hemisphere, and the arrival of a vaccine, we’re going to try to slam the door in the face of Covid-19.
And yet, we will not return to the economic levels of 2019. Not in 2021, and probably not even by 2022.
The virus will fade in wavelets, but economic growth will only restart slowly, posting perhaps +7% worldwide, maybe 8% or 9% compared to 2020. This means that we will stay a long way from the level of January 2019. This period will allow financiers to flourish for some time – explaining the name “Accountant’s Creed” that I gave to this phase. Revenues – profit – solid, square, old-fashioned stuff! Along with a well-deserved pause for breath.
Overall, this will be a period when those who dare in the first half of 2020 will reap the fruits of their labors.
On a closer look, investors will start to come back around the end of 2021, and even more in 2022, with the idea that many of the innovations developed in this period must be industrialized and become real transformations in both companies and markets. It is in this period 2022-2023 that we will see dinosaurs begin to die off as they refuse to evolve.
At this point, I categorically refuse to consider anything beyond 2023. And that, for many months!
To be continued…
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- 100% free trial, eliminating the risk in your outsourcing decisions
(offer ends August 15)
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Interested in learning more about how outsourcing works and how to leverage these offers? Talk to us today.
For further reading about strategies to overcome the crisis, don’t hesitate to check the themes that I addressed in my previous articles:
IT and Digital sector…. Who will survive? And how?
Covid-19 / May-June edition: What are the right management tactics? What are other companies doing?
For Schumpeter and Darwin – Disruption is for Herbivores