COVID19: The End of an Era
The world is on lock-down. We are living through a global tragedy of extraordinary proportions. No-one knows how bad this will be, but one thing is certain: whatever comes after this will be fundamentally different.
The COVID19 crisis marks the end of an era.
Many lives will be lost. Millions others will be disrupted by collapsing economies and recession. Politics as we know it will change.
At the other end of the crisis the world will be a very different place: we’ll see massive shifts in culture and a new economic reality. Different ways to think about community. Different perceptions of wealth and safety. New ways to spend money and consume. New social norms & etiquette. New global alliances and a new international agenda.
Entire new categories of businesses — and business models — that will operate from first principles and will raise to be the drivers of the new economy.
Painful stuff, no doubt. A lot of needless suffering all over the world. But the silver lining is potentially massive. Global crises are humanity’s chance to press the reset button.
The proverbial clean slate.
What does this mean forentrepreneurs?
Covid19 is a massive black swan event. Probably the biggest equalizer in a generation: its aftermath will see incumbents struggling to adapt their outdated infrastructure and business models, allowing plenty of opportunity for insurgents to enter and own entire markets. Out with the old, in with the new.
The question for entrepreneurs is “What can we do NOW to be able to identify these opportunities as they will emerge? I think it is best to look for big trends. The waves forming as we speak:
1. Travel will change fundamentally
The travel industry will be the first to collapse in the crisis. Many incumbents will not make it out of this crisis, in spite of government support. Either way, the way we travel will change fundamentally:
- Long distance travel will become a luxury and, without serious reasons will be frowned upon;
- Young people in particular (who will also be hit hard economically), will make it fashionable to travel small distances and explore locally. This also aligns profoundly with their justified concerns about the environment and their impact on the world;
- New business models will be emerging around individual, real-time, truly local experiences that are virtual and multi-sensory;
- Virtual and Augmented reality will grow as a category and new forms of content will emerge — mixing written, audio, visual with virtual and social into one fundamental form of processing information.
- All of this will affect businesses fundamentally. Business travel as we know it will basically disappear and virtual collaboration will go to the next level (more on that below).
- Without the critical mass of business travelers looking for reasonably priced, bland, sensible accommodation, the hospitality industry will be forced to change as well;
2. The New Work-Space
Ever since the Corona crisis started, everyone is talking about how remote work will be the new norm. I think everyone is right.
Remote work has been around for a while — I myself have been part of several global companies over the last decade that have been fully, first principle remote. Yet, in spite of ample evidence of all the benefits of remote work — around costs, productivity and employee satisfaction — many incumbent players have simply been afraid to pull the trigger. Well, now that they are forced to do so, they will not go back even in the unlikely event that they’d actually want to go back. Employees won’t play ball anymore. Everyone is a digital nomad now.
- We will soon start seeing changes around real estate and urbanization. Commercial real estate will drop in value (and shrink in surface) and private real estate will change as people will need to accommodate for at least two work spaces in their home.
- The short term beneficiaries of this shift will be Ikea and the home improvement businesses, but eventually people will want more than a desk in their living-room. They’ll need proper, physically segregated offices in their homes;
- After the initial excitement, people will eventually be bored of sitting alone in their home office so we will see the emergence of building-level co-working spaces. Like the building laundry.
3. Remote Collaboration will Accelerate
Currently, you basically have two types of real-time, synchronous virtual collaboration:
- You have the slack-type platform, where (mostly) internal teams collaborate and track their work; and
- you have the zoom/ skype type platforms designed for “meetings”, usually external. I generate a link, I send it to you and we meet there at a pre-agreed time, for an hour.
This will not do anymore. And my contrarian opinion is that the zooms and the slacks will actually be the big losers in this shift, not the big winners.
That if they do the usual incumbent thing and persevere in their ways, hoping that their large market share will force the market to change. This will not happen. The playbook is there: Kodak could have gone digital but they didn’t. Microsoft could have gone cloud but they didn’t. Nokia could have gone smartphone but they didn’t. You see the pattern.
As before, new players will emerge that will integrate the slack and the zoom use cases into one platform, as small easy features on top of an entire new experience.
I reckon this experience will be some form of “in office” virtual platform. Like a discord server where people who are working are online and visible to their colleagues (and whoever else they share their status with) and can engage in conversations easily without having to do anything. “Hey, Alice, what are you working on”. “Hey what time are you knocking off” “How was that show yesterday”.
Low frequency communication. Doodling. Whiteboarding. Banter. This is where VR will truly enter the business world.
4. Supply Chains will Change Fundamentally
The first companies to emerge successful out of the crisis will be the ones with local supply chains. Their resilience will drive critical mass and innovation to local, automated supply chains. Watch for an acceleration of local sourcing and hyper localization. I believe we will see a lot more fragmented and decentralized supply chains and a lot more innovation around manufacturing and production methods.
Either way. We are looking at a very tough period for all of us. We’ll have to find the strength to work together and beat this virus. And along the way, rediscover some much needed values: family, community, resilience, resourcefulness.
Originally published at https://circo.io on March 16, 2020.