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COVID-19: Revamped Business Models Of Set-ups
The need of the hour would be to train employees and increase their comfort level with respect to the use of the available technology.
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The Covid 19 pandemic has given a rude jolt to business set-ups, small and large. Be it a small kirana store in a locality or a conglomerate; with their top line being threatened consequent to the disruption caused by the pandemic, have been forced to revamp their business models.
Businesses globally are relooking at their value proposition. They are trying to innovate and come up with business proposals, with safety and convenience of their customers reigning supreme. Of course the quality of products and services that delivers customer satisfaction is not to be compromised. Partnerships and business collaborations have always occupied an important place in business decisions. To deliver innovative value propositions and recapture the lost top line, these partnerships will gain more importance; be it partnerships with your service provider or with your customers, or with your channel partners or maybe even partnerships with your competitors. Leveraging past customer relationships and partnerships would prevent organizations from further erosion of their top lines. The foundation of these partnerships might change from trust gained through physical interfaces to trust established over the virtual landscape.
The changed business environment might also be an opportunity for businesses to target customers who had previously been hesitant of adopting a product or service. Using channels and ways and means to go to the customers’ door-steps would be the key to success. For example, a famous FMCG company in India came up with an idea of providing mobile services wherein the company took the initiative of taking orders online and making deliveries for essentials and other grocery items to customers. The company reached out to the RWAs of various residential colonies to making stocks of essentials available. This not only benefited the company but also provided value to the customers who were saved the botheration of moving out of their colonies in search of daily essentials.
Coming up with alternative sources of revenue streams might help to tide over the challenging times. For example, decision taken by a large automobile company in India to aggressively push its used car business as affordability has taken a hit due to the Covid-19 pandemic drives forth the point. The company has also tied up with a bank to offer variety of easy and attractive finance options to car buyers.
Businesses no doubt will have to shell out resources for upgrading their technical infrastructure. In fact, it is a pleasant surprise to see even small vegetable vendors in residential societies adopting mobile apps for taking orders from customers online and for accepting online payments, followed by physical delivery of the essentials at the customers’ doorsteps. Customers would not mind sharing the increased costs with the service providers if the service meets their needs and creates value for them. For instance, an online delivery platform that has to incur increased costs in executing anti-COVID measures like non-recycling of delivery bags, extra consumables like masks and sanitizers provided to employees decided to charge the extra cost to the customers on their every order, giving them a choice not to pay the extra cost if they are unable to pay or did not want to pay.
The need of the hour would be to train employees and increase their comfort level with respect to the use of the available technology. The changing business environment would require devising ways of keeping employees motivated remotely. The confidence that comes through physical proximity would give way to a confidence built emotionally and virtually. To connect with employees and customers, in various companies, in-person town halls have been replaced by connecting over licensed online platforms.
Businesses might be required to devise new ways of governance and control over the activities of their various internal and external stakeholders, say employees or the various channel partners. Or is it that the need for increased trust and the confidence in the tasks performed by all would go up? Or, likewise, is it that the need for self-discipline and the realization not to take undue advantage of the service-takers’ physical absence and inspection would be the new mantra?
However, what would be interesting to see is whether businesses will treat the revamped business model as a stop-gap arrangement or will it be the new normal for times to come. Sadly, one solution does not fit the bill for varied industries. Industries differ with respect to the impact of the Covid 19 pandemic and their readiness to respond. Hospitality industries, even if they want to respond to the changed business environment are restricted with respect to the nature of their business. They will have to manage to stay afloat by reducing operational costs and preserving working capital, and devise new ways to make a comeback once the situation improves.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.