How to Sustain Business Growth Despite the Pandemic?
Over the past several months, smaller and bigger companies have been struggling with finding their way out of the crisis caused by the COVID-19. The economic uncertainties have often led to making decisions in a rush, which has resulted in the dismissal of employees and the reorganization of previously implemented processes. All in order to stay afloat.
Now it’s time to re-energize organizations and take a second look at the strategy. By reading this article, you will learn what steps are worth taking in order to sustain business growth, regardless of the uncertain future.
Assess if your business strategy is still valid
Every industry is adapting to life during a pandemic in its own way. Some business owners perceive the global crisis as an opportune moment for innovations and new ideas, while others stay more conservative and tend to pause their investments. Anyway, all of us need to make adjustments to meet the latest market needs and conditions.
According to PwC’s CEO Panel Survey conducted in June and July 2020, three main business model changes which CEOs plan to implement are:
- becoming more digital by digitizing core business operations and/or processes;
- being more virtual by adding digital products/services;
- implementing the increasing share of remote workers and/or contingent workers.
The first step of sustaining business growth is rethinking your business strategy. There are many ways to lead, but regardless of your business type or location, you need to ask yourself if the recent global events changed the relevancy of your proposition. Your product may not answer the exact needs as before, and it may turn out that making adaptations are essential to selling what you offer.
CFOs are pursuing changes across many dimensions to capture growth. Changes to products or service offerings, whether new or repurposed, are by far the most pressing, according to 63% of respondents. Pricing strategies are also going to play an important role, with 41% of CFOs citing their importance to revenue growth (source: PwC’s US CFO Pulse Survey)
Your current business plan should be dynamic as well, which means developing and evaluating scenarios that cover all aspects of your company like employees, real estate, products, and customers, in case of further and unexpected changes. Also, take into account new technologies that your company will need to manage the above-mentioned components of the business efficiently. However, focus on investing in technology for growth rather than cost reduction.
From March 2019 to the present, 32% of US finance leaders say their tech-related spending was driven by growth, including e-commerce and new products and services - and 32% expect the same for the next 12 months. One in five say their tech investments will enable or accelerate cost reduction efforts, like automation (source: PwC’s US CFO Pulse Survey).
Reimagine the new normal and be clear about how regulatory and competitive environments in the industry may shift. Your business strategy needs to include actions that your business will take rather than reactions to the current situation. As a business owner or CEO, it will allow you to pursue elements of your plan when you want to, not when you are forced to.
Use the full potential of remote collaboration
In the State of Remote Work 2019 Report by Buffer, you could read that remote work is no longer just a trend and it’s here to stay. Also, 99% of responders claimed they would like to work at least some of the time remotely for the rest of their careers. When it comes to companies that claim to be fully remote, 31% of responders admitted their companies operate this way.
During the last several years, the internet has been swamped with articles about the benefits of remote work, increasing the productivity of remote employees, or managing a remote team. Nobody would then expect remote collaboration to become the new normal so quickly. Only in the US, from April to May 2020, work from home increased by 50% (source: McKinsey).
The company's digital capabilities in the early days of the pandemic determined its ability to adapt to rapidly changing circumstances. The companies that joined the remote revolution earlier could quickly adapt digitization processes among employees and customers. When some companies lose their valuable time switching into the new reality, others could devote it to improving remote work rules, which they had already developed earlier.
Dell, as an example, announced in 2016 that working from home has become a part of its business strategy. This year, well-known brands like Indeed, Microsoft, Google, Facebook, Twitter, Shopify, Slack, American Express, and Airbnb have either extended their remote work policies or plan to let much of their staff work from home permanently.
As long as the job doesn't require an employee's physical presence, you should take advantage of the possibility of remote collaboration. The main pros argument is to have easy access to highly-skilled employees. Hiring, especially IT specialists, is hard. Now, companies don't need to source candidates from a geographically limited talent pool and compete against each other for the best of them.
There is a demand gap for many jobs in the technology field, with data showing that job seeker interest in software architect job postings meets only 29.4% of the employer demand and dev ops job postings meet only 39.6%. With companies desperate to achieve their hiring goals, they’re often settling for subpar candidates, with results showing over half (53%) of respondents have hired tech talent despite candidates not meeting the job description requirements (source: Indeed)
Nowadays, your company has an opportunity to search for candidates based on their qualifications and suitability for roles - where they come from no longer matters. As a result, a business can more effectively pursue top talent and take advantage of a more diverse workforce. Moreover, it can be especially beneficial for startups. A remote talent pool allows smaller companies to compete with larger corporations because the project itself is gaining importance, not the company's benefits.
Shift from FTE to a skill-oriented mindset
The size of the tech talent gap in different continents is increasing. In The Future of Work Report 2020 by Talent Alpha, you can read that the EU is currently experiencing an IT talent shortfall of up to 1 million. Moreover, a potential gap of another 700,000 IT workers is forecasted in the EU by 2030.
Even countries with a high population like the USA, China, and India are in a similar situation. It all means that soon most companies will face a problem with recruiting qualified people for IT jobs to build digital products or implement digital transformation.
According to OECD and WEF data, the fact that every industry is pursuing Digital Transformation only increases the importance of tech skills, which is not only relevant for IT specialists but to the entire global workforce. According to the EU Commissioner for the Digital Economy, after 2020, up to 90% of jobs will require digital skills, meaning that digital skills become an essential competency and the backbone of economic growth (source: Talent Alpha).
One of the solutions that can allow your business to continue to grow even when experiencing a talent shortage is to focus on the amount of work to be done on a given project rather than the number of permanent employees. According to data collected by Gartner, 32% of organizations are replacing full-time employees with contingent workers.
In this case, it is also worth recalling the Pareto principle, also known as the 80-20 rule, which may refer to a skill-oriented mindset. According to it, 80% of the work can be done by 20% of qualified specialists, which means that skills count more than having a full-time employee. To implement this approach, you need to open up to the idea of inviting specialists to complete only specific parts of the project and be ready to accept that they can also work for different organizations.
Here, as an example, our company Blue House can be mentioned. We focus on building a community of highly skilled senior IT specialists and offer our partners to take advantage of their knowledge and experience without the need to hire them permanently. If you want your company to remain an effective player in the market, you need to understand that the traditional way of working has become a thing of the past.
In such a case, being able to scale up or scale down the company's resources quickly is becoming more critical. Mainly because it gives you as an employer a possibility of getting things done when it's needed without generating additional costs resulting from permanent employee retention. Also, you don't need to spend company resources on recruitment processes.
Find a technology partner instead of recruiting
In 2021 and during the following years, there will be much to handle for companies from every industry. We are all looking for the right answers on how to restart the development of our businesses, repair what was broken, and prepare to cope with a host of economic troubles that are ahead of us. Companies need to create a new plan of returning the business to scale even during a challenging time of COVID-19.
One of the ways to increase your business performance is to partner up with a technology company. Technology partnerships help companies and organizations implement and optimize their technical systems and support their product or service development. Besides that, a proper technology partner is an expert you can trust, so such cooperation minimizes the risk of technology failure.
According to reports, 25% of technology projects fail outright; 20 to 25% don’t show any return on investment; and as much as 50% need massive reworking by the time they’re finished (source: Forbes).
The proper cooperation with a technology partner should complement and broaden your company's existing technical knowledge. However, first, you need to make sure that you choose a company that has the right people on board. To do so, it's not enough to look up a company online. Devote some time to meet with a person who represents the other side to find out how they screen their team or community members and what projects they have in their portfolio.
Your future technology partner doesn't need to be a big company. In this case, it does not matter how many people they employ - we could probably even make a case against partnering up with big tech companies. What counts is the knowledge and experience of their specialists. It is said that a single expert or highly skilled engineer is as productive as eight novices.
At Blue House, as an example, we agree with that and believe that the most effective companies are built around small teams of high-performing people - our consultants are senior-level IT experts with the most sought-after skill-sets on the market. Our Blue House community is unique since we put emphasis on referrals while scaling it up.
Moreover recruiting an IT specialist is quite costly, and in the current situation, it is better to invest more in the actual product development than scaling up the in-house development team. According to Devskiller, the average of hiring a software engineer is somewhere around $50,000. Of course, this amount varies depending on the skills, region, seniority level, type of position, etc.
Included in that amount are the internal costs like in-house human-resources team, onboarding process, employee management, and external costs like job ads, consulting services, or third-party fees if you decide to cooperate with recruitment agencies. Suppose you don't think that you want to delegate your project entirely to a technology partner. In that case, you can take advantage of other solutions that they offer - body leasing or team leasing.
Tomorrow's organization may be different from the past. Now, companies need agile and resilient talent to be able to move fast, adapt to change, and continually learn. IT staff augmentation opens up new possibilities for companies. What's more, some IT Staffing Companies offer the option of scaling up or scaling down the resources as you go.
Summing up
In one of the Harvard Business Review articles, the author states that now companies should think like a camel, not like a unicorn. This statement sums up everything that you have read above. Pandemic is a time to rethink financial and operating decisions and consider new options and solutions in order to sustain business growth.
Unicorns are great but also a rare thing since sometimes they disappear as quickly as they appear - as they rapidly grow without considering the current situation's threats. What you need to focus on now is to be cash flow-sensitive and create a realistic operational budget.
Take advantage of remote work and think about what tasks can be delegated outside of your company. Remember that nowadays, employees' skills are indicative of the strength of the organization, not the number of people employed in the enterprise. Consider IT staff augmentation and contact us if you need the right IT experts who can join your forces and boost product development.
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