On 24th September, clad in a nice midnight blue dress and a wide black fashionable belt, CEO See Wai Hun stood in front of a crowd of professionals from various industries. She was invited as a guest speaker by Workplace at the River (W@tR) to enlighten the audience about digital space and outlook post COVID-19. (Check out the FB live stream.)
Before diving right in, let us first define the term ‘digital space’. Digital space is often referred to as what is displayed on the screen of a digital device such as a laptop, computer, tablet, or smartphone. What can be displayed in digital spaces is vast and varied, and it can take countless forms. Within that space, you can develop platforms other people can use and interact with other things people have developed.
You see, COVID-19 has single-handedly disrupted the world in many ways, not only affecting businesses but also the digital space. There is a tectonic shift happening around us. We can never imagine something like this, in this time and age, happening to us. Even with all our technological advancement, we are helpless. However, can there be an opportunity amidst the ‘apocalypse’?
Aside from all the gloom and doom, COVID-19 was in fact a booster for digital transformation. Wai Hun mentioned how there is a convergence of digital and physical space happening right in front of us. An acceleration of past behaviours covering a ‘decade in days’ through digital adoption. Drawing out some amazing and relatable examples provided by Wai Hun, she mentioned how the e-commerce sales sky-rocketed globally. What took the industry 10 years to go from 5.6% to 16% of total retail sales in the US, took them only 8 weeks to climb from 16% to 27% through digital adoption, which was the same amount of market share growth achieved over the prior decade. [Figure 1]
Moreover, during lockdowns, the online entertainment boomed while cinemas suffered. Last November, Disney launched its long-awaited streaming service, Disney Plus. And the timing could not have been better as streaming services exploded in popularity. Disney Plus took 5 months to hit its 50th million subscriber while Netflix took 17 years to crack 50 million subscribers. Disney Plus achieved in 5 months what Netflix took 17 years. [Figure 2] It’s amazing how mass digital adoption through digital spaces have taken such an interesting turn during current events.
There is an explosion of digitisation. The increase in density in digital spaces is recreating social spaces and formulating new behaviours. For instance, Zoom’s daily users ballooned to more than 200 million in March from a previous maximum of 10 million. Teachers are now having piano and ballet classes online. Furthermore, people are spending more on learning subjects that are related to their core courses. Coursera reported seeing 14 million new registered learners since mid-March which was a 500% increase from the same period a year ago. What seemed impossible or ridiculous previously has now become a norm.
Looking at all these astonishing facts and figures, it’s exciting and exhilarating! On the other side of the coin, there were real challenges faced during the global pandemic. Wai Hun explained how terrifying it could be for most businesses. Many businesses were forced to shut down, unemployment rates spiked, and the IMF reported that this was the worst economic downturn ever since the Great Depression. A crisis like no other. Quoting from the Singapore Business Times, she spoke about how Monzo and Revolut, two of the FinTech industry’s leaders, said losses more than doubled and tripled respectively last fiscal year. Investors are now in retreat, having to cut funds globally for FinTech firms in the first half of 2020 by about 35% to US$25.6 billion.
Taking Grab as another example, she also explained that even though Grab had food and other delivery services, they still had to go through an organisation-wide layoff. Based on Channel News Asia, they cut 5% of its headcount and cut back on discretionary spending, halting certain non-core projects.
With all these new trends and new behaviours emerging, what is the outlook post COVID-19? How can we, as business owners, adapt to our ever-changing and volatile environment?
According to Gartner, there are three phases through which all businesses will need to go – ‘Respond’, ‘Recover’, and ‘Renew’. Wai Hun expounded ‘The Reset’ [Figure 3] by stating that businesses can respond based on scenarios. She mentioned how the lockdown puts businesses into the ‘Respond’ phase inflicting immediate positive and negative impacts. For instance, airlines grounded over 80% of their planes while online grocery and delivery services grew exponentially. Wai Hun then shared her experience during the lockdown. She told the audience how she likes to have whipping cream instead of milk in her coffee. After searching high and low for it, she finally found a shop where she could conveniently WhatsApp them to place an order. However, they did not do deliveries but advised her to use Lalamove, a courier and delivery service instead. This whole ordeal made her realise that businesses were proactively learning how to adapt during the ‘Respond’ phase.
Then, coming in to the ‘Recover’ phase is where the reopening of society happens. However, we should not celebrate just yet because reopening could immediately be followed by another lockdown if there is a spike in the number of new COVID-19 cases. This phase will almost be as chaotic as the lockdown. This is when we should say, how does this change our landscape and how should we prepare?
Lastly, moving on to the ‘Renew’ phase, the future becomes more ‘plannable’ and we can accelerate our plans for the business because by then, we would know how customers will behave.
Wai Hun explained how the whole scenario of planning will help businesses assess the changing environment, including the customer’s journey, before imagining how they will operate going forward. She also urges the audience to think of it as a ‘new environment’ rather than just an adaptation of normal to a new normal. Also, to look hard for opportunities and ‘make lemonade’.
If life is giving us lemons, make lemonade.
What do we need to do in order to stay relevant and competitive?
It’s always about examining yourself.
Wai Hun emphasised the importance of asking the right question. You don’t benchmark how digitally mature you are by comparing with others, but by benchmarking against your past self. In addition to benchmarking, what are the objectives you want to meet and what do you want to do?
Before moving further, she also listed and explained the common characteristics of a successful digital business. To highlight a few of those characteristics, one of which is to have a digital strategy and execution. Many businesses are unable to go digital because they do not own a digital strategy. She also detailed the concept of infonomics. According to Gartner, infonomics is the theory, study, and discipline of asserting economic significance to information. It strives to apply both economic and asset management principles and practices to the valuation, handling, and deployment of information assets. In short, infonomics teaches us how businesses can monetise their data assets to derive measurable business value and become data-driven organisations. Many know the importance of fixed assets and intellectual property, but many do not know the value data holds.
‘Infonomics is actually treating data with the same level of respect that you are treating all your other assets, and actually valuing it.’ – See Wai Hun
A digital business is highly dependent on data because strategy and decision-making should be data-driven. This signifies how digitally matured you are. Likewise, she also spoke about having a business model agility character. In desperate times, we are still thinking of our current business models instead of saying – is there something I can pivot to? An agile business model can easily allow businesses to pivot to adjacent markets pushing them out of the boundaries of their core businesses into an adjoining space. This will eventually grow and sustain their businesses in the long run.
Last but not least, Wai Hun introduced the concept of digital ambition to the audience. A digital ambition acts as a compass in clarifying the direction of a digital business, unifying and aligning digital transformational visions across the entire company. It impacts the overall business, from its people, to the culture, to its technology, and even to its competitive advantage.
If you are interested to be a digital leader, what do you need to do? Wai Hun shared three perspectives of a digital ambition that every future digital leader should have. Firstly, optimise your technology in order to improve existing processes. For instance, optimising the payroll processes by creating a paperless payroll system using technology so that even at times of uncertainty, you are able to stay agile and ready to shift accordingly. Secondly, optimise your digital business by adding significant value to your business model. For example, using data or analytics to optimise price and increase spend, improving existing revenue. Another example would be improved employee productivity by using artificial intelligence (AI) or Robotic Process Automation (RPA) to take on more volume without increasing headcount, thus, improving the overall workforce. Thirdly, have a digital business transformation which will lead to a net-new revenue and business model. For example, digitising your products or services like selling digital books and publishing it online instead of only having hard-copied versions. You could also move into adjacent or new industries. Wai Hun mentioned how you can think of your customers in segments and target each segment individually to move into new adjacent markets.
Every business has to mature eventually but each business will have their own reasons to level up in digital maturity. To mature is to enhance business capabilities that will allow you to survive and grow. The good news is, at this time and age, time and energy can be compressed. So, if you want to be a digital leader, leapfrogging up the digital business maturity model ladder [Figure 4] is possible.
Wai Hun ended with a strong statement and a genuine piece of advice. ‘Transform or risk being irrelevant in the future’, said Wai Hun. That is part of the reason why everyone needs to really look at their own business model. How else can you enhance and become digitally adept so that your business can go into new and uprising digital spaces? The future is now. Behaviours are changing, everyone is moving towards digitisation. If we do not own a space there, we risk becoming irrelevant.
If you are interested and like to dive into the greater details and examples, check out Wai Hun’s live stream at Workplace at the River: Digital Space and outlook post COVID-19.