Save-to-thrive Enterprise transformation and performance improvement strategies during the COVID-19 pandemic - Deloitte
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Save-to-thrive Enterprise transformation and performance improvement strategies during the COVID-19 pandemic August 2020
Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic Contents Executive summary 4 About the survey 9 Key global insights 17 Coping with COVID-19: Respond-Recover-Thrive 23 The “Next Normal”— New business conditions after COVID-19 29 Industry sector analysis 35 Save-to-Thrive 39 Conclusion 42 Appendix 47
Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Foreword
The COVID-19 pandemic is reshaping the global business landscape and fundamentally changing
how people around the world live and work. To better understand the short- and long-term impacts
of the crisis—and what companies around the world are doing about it—we recently conducted a
special mid-cycle version of our regular biennial survey of global cost management practices and
transformation trends.
Actions that companies are taking right now to address COVID-19 do business). Now, in response to COVID-19, we are seeing that
can have a major impact on their long-term competitiveness and transformation mindset evolve into “Save-to-Thrive,” with the
performance. As such, it is crucial for decision-makers to understand crisis shining extra light on the talent lever and accelerating key
how the crisis is unfolding from a business perspective, and what the transformation actions such as automation and remote work that
future is likely to hold. can help companies thrive once the virus is contained and the next
normal emerges.
The results of this mid-cycle survey include responses from
1,089 executives with direct involvement in their companies’ cost In contrast to the downturn that began in 2008, which was structural
management and enterprise transformation efforts, and represent a in nature, the current crisis was triggered by external factors and is
broad range of industries and global geographies—with particularly demand-driven. As such, although two-thirds of our respondents
strong representation from countries that have been highly impacted expect at least one more wave of COVID-19 relapses to occur,
by COVID-19. companies around the world are generally optimistic about the
future and intend to bounce back as quickly as possible, adopting
In this report, we discuss the key survey findings using a three-stage a Save-to-Thrive mindset that can help them make strategic shifts
framework (Respond-Recover-Thrive) to analyze companies’ actions to their operating models, products and services, and customer
and expectations as they cope with the pandemic and position engagement capabilities.
themselves for the post-crisis world (the “next normal”).
We hope you find the insights in this special report useful, and look
Our 2019 global survey1, which was conducted prior to COVID-19, forward to hearing your thoughts and feedback.
found the prevailing mindset for strategic cost management was
“Save-to-Transform” (using the strategic levers of cost, growth, talent,
technology and digital enablement to transform how companies
Omar Aguilar Sam Balaji
Strategic Cost Transformation Global Consulting Leader
Global Market Offering Leader Deloitte Touche Tohmatsu Limited
Deloitte Consulting LLP
1. “Save-to-Transform as a catalyst for embracing digital disruption: Deloitte’s second biennial global cost survey,” Deloitte, 2019
3
Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Executive summary
Expectations for COVID-19 is boosting Cost structure is COVID-19 financial The crisis is driving
positive revenue the focus on cost considered the top impacts are demand- more companies to
growth have declined reduction. Relative to internal challenge. driven. The top pursue aggressive
significantly due to pre-COVID-19 levels, Inability to adjust cost external challenges cost reduction
COVID-19. Compared the likelihood of structure to meet reported globally are: targets. Globally,
to pre-COVID-19 undertaking cost demand is the top drop in consumer the percentage of
expectations, the reduction initiatives internal challenge globally demand (74%); shift respondents pursuing
percentage of increased globally and in all regions. Inability in consumer behavior cost reduction targets
respondents globally by 74% (28 percentage to meet employee (67%); cyber security greater than 10%
expecting positive points). Two of three safeguards, and inability vulnerabilities (65%), increased by 61%
revenue growth is companies globally to satisfy increased and supply chain (25 percentage points)
down 40 points. (66%) now expect to demand round out the challenges (65%). compared to pre-
pursue cost reduction top three. COVID-19 levels. Two
over the next 12 of three companies
months, up from just Inability to rapidly globally (66%) now
38% reported before address cost structure have cost reduction
COVID-19. to meet demand: 78% targets that exceed
10%. Regionally, the
Inability to meet
percentage of companies
higher measures
with those aggressive
related to employee
targets is highest in
safeguards: 74%
LATAM (83%) and lowest
Inability to satisfy in the US (59%).
increased demand
or increased sales
opportunities: 71%
Lack of liquidity
or credit to ensure
business continuity:
69%
4
Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Coping with COVID-19:
Respond-Recover-Thrive
Required actions to address the COVID-19 crisis can be divided into three major stages: respond, recover and thrive. These three stages are
interspersed with two additional interim stages (“respond to recover” and “recover to thrive”, and culminate in a long-term operating environment we
call the “next normal.”
The global focus for Revenue growth Automation is the Working through all
the COVID-19 crisis is expectations are very top transformation stages is expected
shifting from respond positive in the thrive action arising from the to require about a year
to recover. Most stage. Expectations for COVID-19 crisis. Globally and a half. Although the
companies globally have revenue growth, although and across all regions, expected durations for
effectively responded down from pre-COVID-19 roughly two of three each stage vary widely
to the immediate crisis levels, remain somewhat companies expect to by region, on average
and are now starting to positive in the respond pursue automation respondents globally
focus on recovery. The stage (55%) and recover in all three stages of expect the respond
majority of companies stage (58%). In the Respond-Recover-Thrive. stage to last about
surveyed (59%) now thrive stage, the vast three months, the
see themselves in the majority of companies recover stage about six
“respond to recover” or globally (74%) and in all months, and the thrive
“recover” stages. regions have a positive stage about 10 months.
revenue outlook.
5
Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
The “Next Normal”—
New business conditions after COVID-19
When mapping out strategies to respond, recover, and thrive, it helps to have informed insights about the future business environment. In the wake
of the 2008 financial crisis, many people called the resulting business environment the “new normal.” However, every new normal eventually gets
replaced by a new new normal, so in our view it makes sense to call the post-COVID business environment the next normal.
Revenue sources will IT infrastructure, Top product strategies Next normal customer Cybersecurity and
be fundamentally remote work and for the next normal engagement strategies cloud will be the key
different in the next digital channels are focus on innovation, will be driven by digital technologies.
normal. expected to be the health and safety channels and flexible According to the survey,
Due to practices such top operating model measures, and customer experiences. the most relevant
social distancing and priorities. In a post- customization. Globally, the most technologies in the
shelter-in-place that crisis, increasingly digital Globally, the top product popular strategies for next normal will be
restrict access to the world, IT infrastructure strategies to compete customer engagement cybersecurity solutions
physical world, the and digital channels will in the next normal are: will be: shift most (80%) and cloud
COVID-19 crisis has be key. Also, remote adjust, redesign transactions to digital computing (80%).
greatly accelerated work will likely remain or innovate your channels (75%), and
the shift from physical popular now that the product/service increase flexibility
to digital channels. It COVID crisis has proven offering to expand before and after the
has also revealed the its viability. Globally, the to adjacent and/or sale (73%).
limitations and risks of top operating model new markets (74%);
globalization and global priorities during the next leverage new health
supply chains, leading normal are expected and safety measures
many companies to to be: enhance IT by redesigning your
re-prioritize domestic infrastructure (78%); current product/
operations over enable remote work service offering
international operations. (76%); and enable pre- (73%); and customize
Meanwhile, COVID- sale, sale, and post- products or services
driven changes to how sale activities through to meet new customer
people live and work are digital channels (72%). and/or government
boosting demand for requirements (73%).
new kinds of products
and services. According
to the survey results,
the fastest growing
revenue sources in
the future will be:
digital channels (vs.
physical channels); new
products and services
(vs. existing pre-
COVID offerings); and
domestic operations
(vs. international
operations).
6
Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Industry sector analysis
Expected growth Different sectors Revenue outlooks the most negative
impacts over the are at different vary significantly by revenue outlooks, while
next 12 months vary stages of progress. industry. Although Medical Technology and
by sector. Revenue In addressing the the future revenue Pharmaceuticals have the
expectations over the challenges of COVID-19, outlook remains most positive outlooks.
next 12 months vary the average rate of generally positive for In the thrive stage,
widely by sector, with progress in all sectors all sectors—especially Hospitality, Chemicals
the COVID-19 crisis falls somewhere in the thrive stage— & Specialty Materials,
impacting sectors between the respond expectations vary and Hardware &
both negatively and and recover stages. significantly by sector. Semiconductors have the
positively. On the The median progress In the respond stage, most negative outlooks,
negative side of the in sectors such as Transportation and while Medical Technology
spectrum, a relatively Hospitality, Capital Consumer Products and Telecom have the
high percentage of sector Markets, and Medical have the most negative most positive outlooks.
respondents expect Technology is skewed revenue outlooks, while
revenue to decline in towards the respond Medical Technology
Transportation (61%) and stage, while sectors and Pharmaceuticals
Hospitality (60%). On the such as Insurance have the most positive
positive side, revenue (both General and Life/ outlooks. In the recover
growth is expected in Annuity), Consumer stage, Transportation and
Medical Technology Products, and Banking Hospitality have
(63%), Telecom (58%), are generally further
Pharmaceuticals (58%), along, with progress
and Software & IT skewed toward the
Services (57%). recover stage.
Save-to-Thrive
Save-to-Transform companies bounce back Most companies Decisions that remote work that
is becoming Save-to- from the COVID-19 crisis expect a second companies make align with the new
Thrive. The strategic and position themselves wave of COVID-19. today to cope with realities of a post-crisis
priorities associated to thrive in the next The majority of the COVID-19 crisis business environment—
with the COVID-19 normal, many expect respondents (67%) can help or hinder companies can
thrive stage are very to continue focusing on expect a COVID-19 their positioning leverage their cost
consistent with the those same levers—but relapse, with an for the future. By savings and
Save-to-Transform with an increased and estimated timeframe using cost reduction improvement efforts
trend we identified accelerated emphasis on of early 2021. Those and performance to not only transform
in 2019, which uses technology and digital that follow strategies improvement strategically how they operate, but
the strategic levers of enablement, along with consistent with Save-to- to transform the to position themselves
cost, growth, talent, a renewed emphasis on Thrive will likely be the enterprise and improve to thrive in the next
technology and digital growth and talent. We ones best positioned competitiveness—which normal.
enablement to transform call this evolved mindset to weather potential includes investing in
how companies do “Save-to-Thrive.” challenges resulting key capabilities such
business. And as from a second wave. as automation and
7
Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic 8
Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
About the survey
9
Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
About the survey
Deloitte Consulting LLP (Deloitte or Deloitte Consulting) engaged Dynata to
conduct a global survey of COVID-19’s impact on organizations—from both a
transformation and performance improvement perspective—to better
understand the changes taking place in current and future actions across
regions and industries.
Study objectives
Conduct a mid-cycle version of
Understand the impact of Compare business
our biennial global cost survey,
COVID-19 on different industry expectations before the
focusing on the impact of COVID-19
sectors and regions COVID-19 pandemic and now
Characterize organizations Identify trends on future
based on three stages of activity: operating models, product/
Respond, Recover and Thrive service offerings and
consumer engagement in a
post-COVID-19 world that we
call the “next normal.
Methodology
Data was collected through detailed online surveys conducted between late June and mid-July 2020.
Analyses were conducted by Deloitte.
January February March April May June July August September October November December
10Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Firmographics
The survey included responses from 1,089 executives directly involved in
transformation efforts in their organizations. Respondents were from four
major regions.
Figure 1. Geographic distribution of survey respondents
Europe APAC
394 responses 268 responses
UK (124) China–Mainland (78)
US Germany (79) China–Hong Kong SAR (44)
308 responses Spain (70) Japan (48)
Italy (70) Australia (44)
France (51) India (44)
New Zealand (10)
LATAM
119 responses
Brazil (72)
Mexico (47)
11Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Surveyed countries are highly representative of their regions and the overall global economy,
in addition to representing geographies highly impacted by COVID-19
The countries included in the survey represent 70% of the world’s economy as measured by Gross
Domestic Product (GDP)*. Outside of the United States, respondents represent 54% to 88% of their
regional economies as measured by GDP (see Figure 2).
Figure 2. Representation of the regional and global economy
Survey sample coverage1 Survey sample coverage2
(% of respondents’ economic distribution (% of respondents’ economic distribution according to 2019 regional GDP)
according to 2019 global GDP)
12%
35%
30%
46%
Survey respondents
represent 70% of the
world’s economy
100%
70%
88%
65%
54%
US Europe LATAM APAC
Europe: UK, Germany, Spain, Italy, France
LATAM: Brazil, Mexico
APAC: China–Mainland, Japan, Australia, India, China–Hong Kong SAR, New Zealand
GDP of countries surveyed GDP of countries not surveyed
Source: The World Bank – GDP 2019
*Source: The World Bank – GDP 2019
12Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
The vast majority of respondents are senior executives, most with direct involvement in
COVID-19 activities
Only relevant executive positions with responsibility for transformation decisions were surveyed:
25% of responses were from presidents or CEOs; almost 60% were from C-Suite executives; 65% of
respondents are directly involved in a COVID-19 response committee (see Figure 3).
Figure 3. Management level breakdown and COVID-19 Committee involvement
Management-level breakdown1 Management-level breakdown2 COVID-19 response
(% of respondents by level) (% of respondents by level and region) committee involvement
(% of respondents by region)
In general, C-suite and executive 64% of respondents on average
management-level response profiles reported to be involved in a COVID-19
were maintained in all regions response committee
4%
9% 10%
17% 71%
70%
37%
64%
Almost 25% of responses
were from president or 65%
CEO roles, almost 60% 55%
from C-level executives,
and the rest from other
25% executive management 71% 52%
positions 59%
58%
44%
40%
31%
19% 20%
US Europe LATAM APAC Global US Europe LATAM APAC
C-level Executives: CIO (Chief Information Officer), CFO (Chief Financial Officer), COO (Chief Operating Officer),
CHRO (Chief Human Resources Officer), CMO (Chief Marketing Officer), CPO (Chief Procurement Officer)
CEO & President C-level executives Other Division/Top management executives
13Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Data was collected to support industry-specific analyses
Industry-specific information was collected to provide meaningful insights across six major industry
groups (see Figure 4).
Figure 4. Industry Breakdown
Regional view
Total
5%
17% Global 187 269 216 175 189 53 1,089
17%
US 43 77 54 58 58 18 308
16% 25%
Europe 58 106 74 93 47 16 394
20%
Technology, Media &
LATAM 27 35 24 11 11 11 119
Telecommunications
Consumer Products, Retail,
Hospitality & Transportation
Energy, Resources & Industrials
Banking, Capital Markets APAC 59 51 64 13 73 8 268
& Insurance
Pharmaceuticals, Medical
Devices & Healthcare
Government and Public Services
14Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Major companies in each region were the primary respondent targets
Among all participating companies, 75% reported revenues greater than $1 billion. Among
the participating US companies, 66% reported revenues greater than $5 billion (see Figure 5).
Distribution of companies is representative of their specific geography or region.
Figure 5. Organization’s Annual Revenue
Global view Regional view
75% of the respondents have reported an annual revenue
75% of the respondents have reported an annual
of more than $1billion. 66% of US respondents have
revenue of more than $1billion
reported an annual revenue of more than $5B
43%
35%
39%
38%
34%
33% 33%
31%
25%
27%
24% 25%
24%
16% 19%
18%
15%
14%
6%
Up to $1B $1B to $5B $5B to $20B $20B+ Up to $1B $1B to $5B $5B to $20B $20B+
Global USA Europe LATAM APAC
Note: Europe, LATAM, and APAC Surveys were conducted in local currency. For analysis purposes they have been converted to US dollars.
15Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic 16
Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Key global
insights
17Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Expectations for positive revenue growth have declined significantly due to COVID-19
Globally, the percentage of respondents expecting positive revenue growth is down 40 points compared to pre-COVID-19
expectations. The decline is somewhat larger in the US (-46 percentage points), and somewhat smaller in LATAM (-37 percentage
points) and APAC (-34 percentage points) (see Figure 6).
Figure 6. Revenue growth outlook over the next 12 months
Global outlook Regional view
Pre-COVID
Pre-COVID
Pre-COVID 92% Pre-COVID
93%
90% 91% Pre-COVID
86%
2 -37 p.p.*
-40 p.p.* -40 p.p.* -34 p.p.*
-46 p.p.*
66%
64%
1 Now
% of total respondents
59% 58%
56% Now 57% 56% Now
Now 55%
50% 51% 52% 51% 51% 51% 51% 52%
Now 50%
46% 46%
44%
3
31%
Global
US
Europe
LATAM
APAC
US
China–Hong Kong SAR
Europe
UK
France
Germany
Spain
Italy
LATAM
Brazil
Mexico
APAC
Japan
Australia
China–Mainland
Positive growth outlook (respondents reporting growth greater than 0%) India
Survey findings
1 50% of respondents globally have a positive outlook on revenue growth right now, higher than the US (46%), but lower than Europe
(51%), APAC (52%) and LATAM (56%).
2 Respondent expectations for positive revenue growth have dropped 40 percentage points globally due to COVID-19, with the largest
decline in the US (46 percentage points) and smallest decline in APAC (34 percentage points).
3 Among individual countries, Japan respondents reported the lowest percentage of respondents with positive revenue growth
expectations (31%), 13 percentage points lower than the second lowest country (UK, 44%).
*p.p. stands for percentage point
18Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
COVID-19 is boosting the focus on cost reduction
Globally, the likelihood of undertaking cost reduction initiatives increased by 74% (28 percentage points) relative to pre-COVID-19
levels. Two of three companies globally (66%) now expect to pursue cost reduction over the next 12 months, up from just 38% before
COVID-19 (see Figure 7).
Figure 7. Likelihood of undertaking cost reduction over the next 12 months
Global view Regional view
2 81%
Now
77% 77%
1 75% Now 75%
72% 73%
Now 70% 70% 71%
68%
66% Now Now
63% 64%
62% 63% 62% 63% +35 p.p.*
% of total respondents
3 59% 59% +28 p.p.*
+21 p.p.*
+28 p.p.* 53%
+30 p.p.*
Pre-COVID Pre-COVID
Pre-COVID Pre-COVID
42% 42%
38% 41% Pre-COVID
33%
China–Hong Kong SAR
Global
US
Europe
LATAM
APAC
US
Europe
Italy
France
Spain
Germany
UK
LATAM
Brazil
Mexico
APAC
Australia
China–Mainland
Japan
India
Survey findings
1 Globally, 66% of respondents expect to undertake cost reduction initiatives over the next 12 months. The likelihood is lower in
the US (62%) and Europe (63%), and higher in LATAM (77%) and APAC (70%).
2 Compared to pre-COVID-19 levels, the likelihood of cost reduction increased by 74% globally (28 percentage points); the largest
increase is in LATAM (35 percentage points) and the lowest is in the US (21 percentage points).
3 Respondents in Italy are the least likely to pursue cost reduction (53%); respondents in Mexico are the most likely (81%).
*p.p. stands for percentage point
19Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
The crisis is prompting many more companies to pursue aggressive cost reduction targets
Globally, the percentage of respondents pursuing cost reduction (66%) now have cost reduction targets that exceed 10%. Regionally, the
targets greater than 10% increased by 61% (25 percentage points) percentage of companies with those aggressive targets is highest in
compared to pre-COVID-19 levels. Two of three companies globally LATAM (83%) and lowest in the US (59%) (see Figure 8).
Figure 8. Respondents reporting annual cost reduction targets greater than 10%
Global view Regional view
2 Now
85%
83% 83% 82% 82%
80%
1 Now 73%
Now 70% 69% 70%
66% Now
63% Now 63% 63% 63% 64%
+36 p.p.*
59% 3
% of total respondents
59% 59% 59%
56%
+23 p.p.*
+25 p.p.* +25 p.p.*
+23 p.p.*
Pre-COVID Pre-COVID
47% 47%
Pre-COVID
Pre-COVID
41% Pre-COVID 38%
36%
Global
US
Europe
LATAM
APAC
US
China–Hong Kong SAR
Europe
Italy
France
Spain
Germany
UK
LATAM
Brazil
Mexico
APAC
Japan
China–Mainland
Australia
India
Survey findings
1
Globally, 66% of respondents have cost reduction target above 10%, with the US (59%) and Europe (63%) below the global
average, and LATAM (83%) and APAC (70%) above it.
2 Compared to pre-COVID-19 levels, the percentage of companies globally with cost reduction targets above 10% increased by
61% (25 percentage points), with a largest increase in LATAM (36 percentage points) and the smallest in APAC and the US (23
percentage points)
3 Japan (56%) has the smallest percentage of respondents pursuing cost reduction targets greater than 10%; Mexico (85%) has
the largest.
*p.p. stands for percentage point
20Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
COVID-19 financial impacts are demand-driven
The top external challenge reported globally is a drop in supply chain challenges (65%) round out the top four external
consumer demand (74%), followed by a related shift in consumer challenges. In the US and APAC, supply chain and distribution
behavior (67%). Cyber security vulnerabilities (65%) and challenges rank among the top three (see Figure 9).
Figure 9. External challenges currently faced by organizations due to COVID-19 impacts
Global view Regional view
84%
1
74% 75% 3 2
2 72% 71%
70% 70% 70% 70% 70% 69%
67% 67%
65% 65%
62%
60%
% of total respondents
48% 48%
US Europe LATAM APAC
Drop in consumer demand Supply Chain and distribution challenges Increased regulatory requirements
Shift in consumer behavior Lack of liquidity and/or credit to reopen business activity
Cyber security vulnerabilities availability
Speed of Digital Transformation
Survey findings
1 Drop in consumer demand is the top external challenge reported globally (74%) and in all regions: US (75%), Europe (72%), LATAM
(84%) and APAC (70%).
2 US and APAC respondents reported supply chain and distribution challenges among their top three external challenges.
3 LATAM was the only region to cite lack of liquidity and/or credit availability as a top three external challenge.
21Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Cost structure is considered the top internal challenge
Inability to adjust cost structure to meet demand is the top internal challenge globally and in all regions. Inability to meet employee
safeguards, and inability to satisfy increased demand round out the top three internal challenges globally (see Figure 10).
Figure 10. Internal challenges currently faced by organizations due to COVID-19 impacts
Global view Regional view
2
1
78% 78% 78% 3 79%
75% 76% 76%
74% 73% 73% 74% 74% 73% 74%
71% 71% 72%
69%
63% 63%
% of total respondents
55%
46%
US Europe LATAM APAC
Inability to rapidly adjust cost structure Inability to satisfy increased demand or Challenges with technology infrastructure
to meet demand increased sales opportunities to meet new internal business conditions
Inability to meet higher measures Lack of liquidity or credit to ensure Inability to enable digital infrastructure
related to employee safeguards business continuity to meet new external business
conditions and scale
Survey findings
1 Adjusting cost structure to meet demand was reported as the top internal challenge globally (78%) and in all regions.
2 Adjusting cost structure, meeting employee safeguards, and satisfying increased demand are the top three internal
challenges reported in all regions except Europe.
3 Lack of liquidity or credit (73%) is a top three concern reported only in Europe.
22Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Coping with COVID-19:
Respond, Recover and Thrive
23Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Respond-Recover-Thrive
Required actions to address the COVID-19 crisis can be divided into three major stages: Respond, Recover and Thrive. These
three stages are interspersed with two additional interim stages, and culminate in a long-term operating environment we call
the “next normal” (see Figure 11).
Figure 11. The Respond-Recover-Thrive framework
Respond
1
Currently taking actions to immediately
respond to the COVID-19 crisis and ensure
business continuity
Between respond and recover
Near completion of immediate response actions
and starting to take actions towards stabilizing
operations under COVID-19 conditions
2
Recover
Currently taking actions to stabilize operations
under COVID-19 conditions
Between recover and thrive
Near completion of Stabilization actions and
starting to take structural actions to operate in
the “Next Normal“
Thrive
3
Currently taking structural actions as result
of a defined strategy to operate and
compete in the “Next Normal”
“Next Normal”
The new business conditions established, after the
Thrive stage, as a result of the societal, commercial
and technological changes caused by public and
private reactions to COVID-19
24Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
The global focus for the COVID-19 crisis is shifting from respond to recover
Most companies globally have effectively responded to the Respondents in the US and Europe are somewhat ahead of the
immediate crisis and are now starting to focus on recovery, with global average, while respondents in APAC and especially LATAM
the majority (59%) now seeing themselves in the “respond to are lagging behind.
recover” or “recover” stages (see Figure 12). The orange triangles,
which represent the 50th percentile, show that on average the The red triangles, which represent the 75th percentile, show that
companies surveyed are still in the “respond to recover” stage, even leading companies are often still in the recover phase, with
where they have nearly completed their immediate response fewer than 25% in the “recover to thrive” or “thrive” stages.
actions and are starting to focus on recovery (i.e., stabilization).
Figure 12. Organization’s current positioning on the Respond-Recover-Thrive framework
Respond Respond to recover Recover Recover to thrive Thrive
Global 19% 32% 1 27% 16% 7%
US 19% 27% 26% 22% 7%
Europe 17% 31% 30% 15% 7%
LATAM 26% 2 35% 18% 13% 8%
3
APAC 18% 38% 27% 12% 5%
50th percentile 75th percentile
Survey findings
1
78% of respondents globally still see themselves no further along than the “recover” stage (and some are still in the “respond”
stage).
2 The majority of respondents globally (59%) and across regions are in the “respond to recover” or “recover” stages, except in
LATAM where the majority (61%) are still in the “respond” or “respond to recover” stages.
3 APAC has the highest number of respondents in the “respond to recover” stage (38%).
(See the appendix for a more detailed country-by-country analysis)
25Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Revenue growth expectations are very positive in the thrive stage
Expectations for revenue growth, although down from pre- majority of companies globally (74%) and in all regions have
COVID-19 levels, remain somewhat positive in the respond a positive outlook for revenue growth, with only 24% globally
stage (55%) and recover stage (58%). In the thrive stage, the vast expecting flat or declining revenue (see Figure 13).
Figure 13. Revenue growth outlook reported at each stage
1 Respond 2 Recover 3 Thrive
Global 32% 12% 64% 25% 16% 58% 15% 9% 74%
1 2
US 36% 12% 50% 29% 19% 50% 14% 9% 73%
3 4
Europe 32% 12% 56% 25% 18% 57% 17% 10% 72%
LATAM 32% 6% 62% 17% 10% 72% 14% 7% 79%
4
APAC 28% 13% 57% 24% 12% 62% 12% 10% 74%
Decline No growth Growth
Note: Responses do not add up to 100% due to some participants answering “Not sure.”
Survey findings
Globally, expectations for positive revenue growth improve significantly in each subsequent stage: respond (55%); recover (58%); and
1
thrive (74%).
2 Conversely, the percentage of companies that expect their revenues to decline or remain flat decreases for each subsequent stage:
respond (44%); recover (41%); and thrive (24%).
3 Regionally, expectations for positive revenue growth increase in subsequent stages for all regions except the US, where the revenue
outlook remains same in the respond and recover stages.
4 US respondents generally have the least positive revenue outlook, while LATAM respondents generally have the most positive outlook.
(See the appendix for a more detailed country-by-country analysis)
26Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Automation is the top transformation action arising from the COVID-19 crisis
Globally and across all regions, roughly two out of three companies expect to pursue automation in all three stages of respond, recover
and thrive, making it the clear leader in transformation actions arising from the COVID-19 crisis (see Figure 14).
Figure 14. Likelihood of transformation actions at each stage
Global view Regional view
Respond
1 72% 70%
66% 64% 2 68% 67% 67%
65%
62% 61% 60% 62% 61% 62%
% of total respondents
58% 58% 57% 57% 56%
55% 54% 52%
48% 49% 48%
46%
Global US Europe LATAM APAC
Recover
73% 3
3
67% 65% 63% 67% 68% 65% 65%
3 64%
% of total respondents
60% 59% 58% 60% 58% 56%
57% 56% 55% 55% 55%
55%
49%
46% 46% 45% 44%
Global US Europe LATAM APAC
Thrive
75%
69% 71% 69%
66% 65% 65%
% of total respondents
60% 59% 58% 61% 60%
58% 56% 57% 57% 56% 55% 56%
55% 55%
48% 49%
46% 46% 46%
Global US Europe LATAM APAC
Automation Labor and non-labor cost reduction Transform business process
Transform supply chain Business rationalization through Declare bankruptcy or insolvency
M&A or divestments
Survey findings
1
Globally, automation is the transformation action most likely to be implemented across all stages according to
respondents for addressing the COVID-19 crisis (65% or more)
2
Automation is also expected to be the top transformation action by respondents in all regions.
3
For each subsequent stage, there is a reported decline in the likelihood of implementing labor and non-labor cost
reduction initiatives in the US, Europe and APAC. This is consistent with a generally positive revenue growth outlook.
27Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Working through all three stages is expected to require about a year and a half
On average, respondents globally expect the “respond” stage to last about 3 months, the “recover” stage about 6 months, and the
“thrive” stage about 10 months. However, the expected durations for each stage vary widely by respondent and region (see Figure 15).
Figure 15. Expected duration reported of each stage
Respond Recover Thrive
3.2 6.0 10.1
Global
Range: 2.9–3.6 months Range: 5.4–7.2 months Range: 9.5–10.5 months
3.6 5.4 9.5
1 1
3.4 6.6 10.5
2 2 3
Regional 2.9 7.2 9.8
3 3
3.1 5.7 10.4
2 4 5 8 9 11
Months
Global USA Europe LATAM APAC
Survey findings
1
US respondents generally expect each of the three stages to take longer than the global averages: respond (3.4
months vs. the global average of 3.2 months), recover (6.6 months vs. the global average of 6.0 months), and thrive
(10.5 months vs. the global average of 10.1 months)
2
APAC respondents expect the shortest durations for respond (2.9 months) and recover (5.4 months)
3
European respondents generally expect each of the three stages to take less time than the global averages
28Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
The “Next Normal”—
New business conditions
after COVID-19
29Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
When mapping out strategies to respond, recover and thrive, it helps to have
informed insights about the future business environment. In the wake of the
2008 financial crisis, many people called the resulting business environment
the “new normal.” However, every new normal eventually gets replaced by
a new new normal, so in our view it makes sense to call the post-COVID
business environment the next normal.
Revenue sources will be fundamentally different in the next normal
According to the survey results, the fastest growing revenue digital channels. It has also revealed the limitations and risks of
sources in the future will be: digital channels (vs. physical globalization and global supply chains, leading many companies
channels); new products and services (vs. existing pre- to re-prioritize domestic operations over international
COVID offerings); and domestic operations (vs. international operations. Meanwhile, COVID-driven changes to how people
operations). Thanks to practices such social distancing and live and work are boosting demand for new kinds of products
shelter-in-place that restrict access to the physical world, the and services (see Figure 16).
COVID-19 crisis has greatly accelerated the shift from physical to
Figure 16. Growth expected by revenue source in the next normal
Global view Regional view
Rank US Europe LATAM APAC
1 Digital channels 1 2
3
2
Post-COVID-19 new
products and services
14% more when
3 Domestic operations compared to
pre-COVID-19 63% more when
compared to
physical channels
4 Pre-COVID-19 core portfolio
of products and services
24% more when
compared to
5 International
operations
international
6 Physical
channels
Survey findings
1
During the next normal, respondents expect digital channels to have 63% higher revenue growth than physical channels. New
post-COVID-19 products are expected to grow 14% more than pre-COVID-19 products. And domestic operations are expected to
grow 24% more than international operations.
2
In all regions, respondents expect digital channels to have the highest revenue growth of any revenue sources.
3
Post-COVID-19, respondents expect new products and domestic operations to see high revenue growth in all regions expect
LATAM, where pre-COVID-19 products are ranked higher than domestic operations.
30Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
IT infrastructure, remote work and digital channels will be the top operating model priorities in a post-crisis world
Globally, the top operating model priorities during the next normal world, IT infrastructure and digital channels are key. Also, remote
are expected to be: enhance IT infrastructure (78%); enable work will likely remain popular now that the COVID crisis has
remote work (76%); and enable pre-sale, sale, and post-sale proven its viability (see Figure 17).
activities through digital channels (72%). In an increasingly digital
Figure 17. Expected priorities for operating models in the next normal
Global view Regional view
2
3
87%
1 83%
78% 79% 79% 78%
77% 76% 76% 77% 76% 76%
72%
67%
65% 65% 65%
62% 62% 61%
% of total respondents
US Europe LATAM APAC
Enhance IT infrastructure to support Redesign the supply chain Insource business processes or functions
management and operations Simplify the organizational structure Outsource non-core processes
Enable extensive remote work Adjust real estate infrastructure
Enable pre-sale, sale and post-sale
activities through digital channels
Survey findings
1
Globally, respondents expect their future operating models to rely on enhancing IT infrastructure (78%) and enabling
remote work (77%).
2
In all regions, IT infrastructure, remote work and digital channels are also the reported top three priorities in future
operating models.
3
In LATAM, the top operating priority expected by respondents is enabling pre-sale, sale and post-sale activities through
digital channels.
31Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Top product strategies for the next normal focus on innovation, health and safety measures, and customization
Globally, the top product strategies to compete in the next your current product/service offering (73%); and customize
normal are: adjust, redesign or innovate your product/service products or services to meet new customer and/or government
offering to expand to adjacent and/or new markets (74%); requirements (73%) (see Figure 18).
leverage new health and safety measures by redesigning
Figure 18. Product strategies to differentiate and compete in the next normal
Global view Regional view
87% 3
83% 82%
1 77% 78%
2 76% 76% 75%
74% 73% 73%
71% 70% 70% 70%
68% 68% 69% 69%
67%
65%
% of total respondents
US Europe LATAM APAC
Adjust, redesign or innovate your Customize products or services to meet Focus only on core products, by rationalizing
product/service offering to expand to new customer and/or government your portfolio and maximizing core
adjacent and/or new markets requirements competitive advantages
Leverage new health and safety Maximize local supply chain by redesigning
measures by redesigning your current your current product/service offering
product/service offering
Survey findings
1
Global respondents plan to differentiate their products and compete more effectively by: adjusting, redesigning or innovating
their product/service offerings (74%), leveraging health and safety measures into product/service design (73%), and product
customization (73%).
2
Respondents across all regions have the same top three product strategies, except for the US, where focusing on core products
ranks third.
3
L ATAM respondents reported significantly higher ratings across all strategies.
32Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Next normal customer engagement strategies will be driven by digital channels and flexible customer experiences
Globally, the most popular strategy for customer engagement will be to shift most transactions to digital channels (75%). The second
most popular strategy will be to increase flexibility before and after the sale (73%) (see Figure 19).
Figure 19. Customer engagement strategies to differentiate and compete in the next normal
Global view Regional view
3
84% 83%
82%
80% 80% 79%
2
1 77% 77% 77%
75% 74%
73% 73% 72% 72% 71% 71%
71% 71% 70% 70% 69% 69%
69% 69% 68%
67% 67% 66% 67% 67%
64% 65% 64%
62%
% of total respondents
US Europe LATAM APAC
Shift most transactions to digital channels Cross-sell product / service to increase Redefine brand to become more impactful
Increase flexibility before and after sales value delivered to customer Differentiate service level by customer
Increase of self-service options Redesign loyalty programs based on new segment value
health, safety, mobility conditions
Survey findings
1
Globally, the reported top strategies for creating a compelling customer experience in the next normal are: shift to digital channels
(75%), increase flexibility pre- and post-sale (73%); increase self-service options (71%); and cross-sell products and services (71%).
2
In the US, the top customer engagement strategy reported is to increase flexibility before and after the sale (73%).
3
In LATAM, the top strategies reported are cross-selling products/services (84%) and redesigning loyalty programs (83%).
33Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Cybersecurity and cloud will be the key technologies
According to the survey, the most relevant technologies in the next normal will be cybersecurity solutions (80%) and cloud computing
(80%) (see Figure 20).
Figure 20. Relevance of technologies to operate in the next normal
Global view Regional view
1 83% 2
81% 82%
80% 80% 79% 79% 80%
77% 77% 3
75% 75%
73% 73% 73%
65%
60%
% of total respondents
58%
44%
34%
US Europe LATAM APAC
Cybersecurity solutions Internet of things (IoT) Virtual reality or remote enablement technology
Cloud computing Robotic Process Automation (RPA) Blockchain
Cognitive and artificial intelligence tools Business Intelligence and advanced analytics
Survey findings
1
Globally, cybersecurity solutions (80%) and cloud computing (80%) are expected by respondents to be the most relevant
technologies in the next normal.
2
Cybersecurity solutions and cloud computing top the list of respondents in all regions except LATAM, where cognitive and artificial
intelligence tools are considered more relevant in a post-crisis world.
3
Internet of things (IOT) makes the top three in APAC (73%), but not for respondents in the US and Europe.
34Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Industry
sector analysis
35Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Expected growth impacts over the next 12 months vary by sector
Revenue expectations over the next 12 months vary widely by sector, sector respondents. On the positive side, revenue growth is expected
with the COVID-19 crisis creating both winners and losers. On the by 63% of Medical Technology sector respondents, followed closely
negative side of the spectrum, a decline in revenue is expected by by Telecom (58%), Pharmaceuticals (58%), and Software & IT Services
61% of Transportation sector respondents and 60% of Hospitality (57%) (see Figure 21).
Figure 21. Sector 12-month revenue growth outlook
Negative growth outlook (decline) Positive growth outlook (growth)
Pharmaceuticals
specialty materials
technology
Software and
Capital markets
semiconductors
Medical
Chemicals and
Hardware and
IT services
Telecom
Banking
63%
57% 58% 58%
51% 51% 52%
48% 49%
45% 46%
42% 38%
39% 36%
37%
23%
4% 6% 7% 8%
9% 9% 8% 9%
15% 12% 14%
16% 15% 17% 17% 16%
18%
28%
31%
46% 44% 40% 28%
40% 27%
48% 32%
60% 43% 34%
46% 46%
46%
61%
Oil & Gas
Consumer
Products
Providers
Health Care
Retail
Insurance–
Life and Annuity
Insurance–
General
Industrial
Products
Hospitality
Transportation
Sectors arranged in order of negative growth outlook (decline) Sectors arranged in order of positive growth outlook (growth)
Decline No growth Growth
36Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Different sectors are at different stages of progress
In addressing the challenges of COVID-19, the average rate of Capital Markets, and Medical Technology is skewed towards the
progress in all sectors falls somewhere between the “respond” “respond” stage, while sectors such as Insurance (both General
and “recover” stages. As depicted by the orange triangles in and Life/Annuity), Consumer Products, and Banking are generally
Figure 22, the median progress in sectors such as Hospitality, further along, with progress skewed toward the “recover” stage.
Figure 22. Current sector positioning on the Respond-Recover-Thrive framework
Respond Respond to recover Recover Recover to thrive Thrive
Hospitality 27% 37% 25% 6% 6%
Capital Markets 17% 46% 22% 12% 2%
Retail 20% 38% 16% 17% 9%
Medical Technology 28% 29% 24% 13% 7%
Oil & Gas 15% 38% 32% 11% 4%
Software and IT Services 26% 27% 30% 10% 6%
Pharmaceuticals 25% 26% 25% 18% 7%
Industrial Products 17% 33% 34% 14% 2%
Transportation 12% 38% 20% 25% 6%
Banking 18% 31% 21% 25% 4%
Hardware and
18% 31% 27% 16% 7%
Semiconductors
Consumer Products 21% 25% 24% 16% 13%
Telecom 15% 29% 29% 15% 13%
Healthcare Services 13% 30% 33% 20% 3%
Chemical and
12% 32% 35% 17% 5%
Specialty Materials
Insurance–Life and Annuity 8% 35% 31% 19% 8%
Insurance–General 5% 27% 44% 12% 12%
50th percentile 75th percentile
Looking at the red triangles (which depict the 75th percentile), the Overall, there is much more variation between sectors at the 75th
relative results directionally align with the median (i.e., the 50th percentile. However, in most cases the 75th percentile falls within the
percentile), but with a few noteworthy exceptions such as Hospitality “recover” stage, except for the Hospitality sector, which has been hit
(where 75th percentile companies are closer to the median than in particularly hard by the COVID-19 crisis.
other sectors) and Banking (where 75th percentile companies are far
ahead of the median and actually lead all other sectors).
37Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Revenue outlooks vary significantly by industry
Although the future revenue outlook remains generally positive for all sectors—especially in the thrive stage—expectations vary
significantly by sector (see Figure 23).
• In the respond stage, Transportation and Consumer • In the thrive stage, Hospitality, Chemicals & Specialty Materials,
Products have the most negative revenue outlooks, while and Hardware & Semiconductors have the most negative
Medical Technology and Pharmaceuticals have the most outlooks, while Medical Technology and Telecom have the
positive outlooks. most positive outlooks.
• In the recover stage, Transportation and Hospitality have the • The Medical Technology sector stands out for having the most
most negative revenue outlooks, while Medical Technology positive revenue growth outlook in all three stages.
and Pharmaceuticals have the most positive outlooks.
Figure 23. Sector revenue growth outlook by stage
Respond Recover Thrive
Transportation 48% 10% 42% 41% 6% 54% 12% 12% 74%
Consumer Products 45% 6% 49% 27% 15% 58% 10% 13% 75%
Industrial Products 41% 20% 37% 31% 18% 49% 17% 7% 72%
Insurance–General 39% 17% 44% 22% 27% 51% 10%10% 80%
Retail 38% 10% 52% 19% 22% 59% 14% 10% 75%
Telecom 35% 7% 56% 24% 22% 53% 9% 7% 82%
Capital Markets 34% 17% 46% 20% 15% 50% 20% 5% 73%
Hospitality 33% 6% 62% 35% 15% 50% 27% 8% 65%
Chemical and
Specialty Materials 30% 12% 57% 33% 10% 53% 22% 12% 65%
Software and IT Services
30% 9% 61% 19% 14% 66% 13% 13% 74%
Banking
28% 12% 58% 18% 21% 60% 12% 9% 76%
Health Care Providers
27% 8% 63% 30% 12% 57% 18% 8% 72%
Software and
Semiconductors 25% 11% 62% 22% 13% 64% 22% 9% 65%
Pharmaceuticals 25% 11% 65% 19% 9% 70% 16% 4% 77%
Oil & Gas
23% 12% 64% 25% 14% 62% 12% 11% 77%
Insurance–Life and Annuity
23% 31% 46% 23% 38% 38% 12% 8% 81%
Medical Technology
17% 14% 67% 11% 17% 71% 6% 10% 82%
Decline No growth Growth Most positive growth outlook Most negative growth outlook
38Save-to-Thrive | Enterprise transformation and performance improvement
Save-to-Thrive | Enterprise
strategies during the COVID-19
transformation
pandemic and performance improvement strategies during the COVID-19 pandemic
Save-to-Thrive
39Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Save-to-Transform is becoming Save-to-Thrive
The strategic priorities associated with the COVID-19 thrive to thrive in the next normal, many expect to continue focusing
stage are very consistent with the Save-to-Transform trend we on those same levers—but with an increased and accelerated
identified in Deloitte’s 2019 Cost Survey, which uses the strategic emphasis on technology and digital enablement, along with a
levers of cost, growth, talent, technology and digital enablement renewed emphasis on growth and talent. We call this evolved
to transform how companies do business.2 And as companies mindset “Save-to-Thrive.” (see Figure 24).
bounce back from the COVID-19 crisis and position themselves
Figure 24. Organization’s strategic priorities reported at each stage
Strategic priorities Strategic priorities
in the 2019 Cost Survey by COVID-19 recovery stage (2020)
Save-to-transform Respond Recover Thrive
1 2
1 1 3
3 78% 77% 3 79% 78% 78%
77% 77% 2 76%
75% 2 75%
73% 73% 72% 71% 70%
71% 70% 70% 70%
69% 69% 69%
65%
61%
% of total respondents
Sales growth Technology implementation Cost reduction Digital enablement Talent management Liquidity management
for employee safety for employees safety
Survey findings
1
IT-related strategic priorities (i.e. digital enablement and technology Save-to-transform
implementation) top the list of global respondents in all three stages of Deloitte’s 2019 Biannual Cost Survey
Respond-Recover-Thrive. saw a shift in the key focus areas of
companies from save-to-grow to save-
2 Respondents expect sales growth to rise as a strategic priority in each
to-transform.
subsequent stage, bringing the priorities into alignment with Save-to-
Transform at the thrive stage. This means that, in addition to cost,
3 In all stages, respondents continue to rank “talent to manage new ways of growth, and talent, technology
working” among the top priorities (along with technology and growth). became a key priority area for most
companies.
In the current survey, we can clearly
observe that IT levers (technology
implementation and digital
capabilities) continue to be among the
top priorities.
2. “Save-to-Transform as a catalyst for embracing digital disruption: Deloitte’s second biennial global cost survey,” Deloitte, 2019
40Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic
Most companies expect a second wave of COVID-19
The majority of respondents (65%) expect a COVID-19 relapse, with an estimated timeframe of early 2021. Those that follow
strategies consistent with Save-to-Thrive will likely be the ones best positioned to weather potential challenges resulting from a
second wave (see Figure 25).
Figure 25. Expectation of COVID-19 relapse and expected time of relapse
Sentiment
on relapse of COVID-19 Expected time before relapse
Global
1 1
35% 7.3
65%
6.7–8.0 months
3
6.7
2 3 2
33% 36% 45% 32% 8.0
64% 55% 68% 6.8
67%
7.3
US Europe LATAM APAC
5 6 7 8 9
Yes, relapse is expected No relapse expected Months
Survey findings
1
Globally, 65% of respondents expect a relapse of COVID-19, with an expected timeframe of 7.3 months from the date of the
survey (early July 2020).
2 In the US, 67% of respondents expect a relapse to happen; however, the expected timeframe is 8 months—the longest
among all regions.
3 In LATAM, 55% of respondents expect a relapse, and the expected time timeframe is 6.7 months; both numbers are the lowest
among all regions.
41Save-to-Thrive | Enterprise transformation and performance improvement strategies during the COVID-19 pandemic Conclusion The COVID-19 pandemic is having a massive impact on the global business environment. Yet many companies continue to expect positive revenue growth—particularly in the thrive stage when they have successfully responded to and recovered from the early challenges of the crisis. Decisions that companies make today to cope with COVID-19 By using cost reduction and performance improvement can help or hinder their positioning for the future. Before strategically to transform the enterprise and improve the pandemic, the prevailing mindset for strategic cost competitiveness—which includes investing in key capabilities management and transformations in general was “Save- such as automation and remote work that align with the to-Transform”—using the strategic levers of cost, growth, new realities of a post-crisis business environment— talent, technology and digital enablement to transform how companies can leverage their cost savings and performance companies do business. Now, we are seeing that Save-to- improvement efforts to not only transform how they operate, Transform mindset evolve into “Save-to-Thrive,” with the crisis but to position themselves to thrive in the next normal. highlighting and accelerating changes in key transformation areas such as technology and talent. 42
You can also read
