Major events change the course of history and COVID-19 will not be an exception. These events have the potential to revolutionize how business is conducted, and the economic recovery from the current crisis may see many more people making the transition from employee to entrepreneur. Historically, crises and disasters have spurred some of the biggest periods of innovation. For example, the Black Plague of the 1300s hastened the end of the European feudal system and led to the employment contracts that exist today. The deep economic recession caused by the Hundred Years’ War between England and France resulted in major agricultural changes that increased productivity and reduced waste.
A more modern, and perhaps more applicable, example is the SARS pandemic of 2002, which lasted multiple years. While the pandemic never reached the United States, it sparked change in other parts of the world. Ali Baba, now one of the largest companies in the world, got its start during this pandemic, as people became anxious to leave their homes for shopping. The situation was similar to what COVID-19 has done across the world, and shifts in how both consumers and businesses behave have already surfaced. For example, many industries outside of tech have adopted work-from-home regimes, including classrooms. Stores are struggling to keep certain items stocked as supply chains across the globe are disrupted. Some of these shifts will eventually revert to normal, but lasting changes are inevitable.
Creating Space for Entrepreneurship
The lasting changes from this pandemic will be driven by entrepreneurs who recognize the weaknesses in local and global systems highlighted by the crisis. Entrepreneurs will introduce the innovations that will make the world more resilient and more capable of dealing with future crises. As the world recovers from the pandemic, people will be ready for change. Recessions themselves often accelerate changes to business models as entrepreneurs figure out ways to reduce prices. Pandemics have historically created entirely new business categories. Both global events encourage innovation and make consumers around the world more open to the idea of change. While some of the ideas that are likely to stick around were present before COVID-19, the pandemic may create the right environment for lasting innovation.
Adapting to Home-Based Work Culture
Many people have already predicated that remote working and online education will be much more popular even after health concerns have abated. The question that entrepreneurs may be asking themselves is how this shift toward remote work will change the working environment. This shift will likely impact productivity, morale, company culture, and even mental health, and businesses will be smart to figure out the tools that address these issues before they become problematic. Some companies have already started to emerge to address these concerns. Ripple, for example, is a networking app that can promote mentoring and development, while startups like Moment Pebble and Braive are addressing the mental health issues that come with the isolation of working from home.
Creating a More Robust Supply Chain
The other issue clearly highlighted by this pandemic is related to supply chains. For decades now, global supply chains have focused on keeping quality constant while lowering costs, which has concentrated risk and encouraged the growth of just-in-time manufacturing. The dangers of this approach are now clear, especially with China scaling down due to COVID-19. Many supply chains have been disrupted, with companies having few options to restore them in a timely manner. Clearly, the need for coordinated and trackable supply chains has arisen. Luckily, the current technological environment is well positioned to help build new supply chains that take advantage of 5G, blockchain, robotics, artificial intelligence, and the Internet of Things. These technologies can be used to link multiple buyers and multiple vendors to create a sort of mesh of distributed, rather than centralized, supply chains that may be more resilient to disruptions.
A related need that may arise deals with fulfillment. While ecommerce brands struggle to increase hiring of delivery drivers, in the longer term, technology is set to outstrip the number of drivers needed to fulfill transactions. The result will be a push for delivery drones, self-driving cars, and other technologies that can address this problem. Startups in this sector will likely receive a lot of attention from Amazon, Ali Baba, and similar companies in the years to come as they compete for ownership of the most sophisticated supply chain.
Helping Cities React Quickly
Entrepreneurs may also be paying more attention to digital cities in the years after COVID-19. Some governments across the globe responded impressively quickly to the pandemic. China, for example, built hundreds of thousands of square feet of hospital space in a matter of days. Many countries have used smartphones to track and alert people who have been potentially infected, which is a key part of the “track and trace” public health approach to contain outbreaks. For many people, these impressive feats demonstrated the importance of smart, digitally connected cities that are able to use data effectively. There are already many “digital city” startups and other companies focused on tech and analytics for the public sector across Europe, the United States, and the Middle East. This sector will likely see significant growth following the crisis.