How to rebound when your sector takes a hit: Part four

When you are in a time of crisis, or coming out of one, it is a good time to take stock and look at what you can do to insulate yourself from future market disruptions. There are four steps to this. In part one we looked at how to prepare ahead for hard times; in part two, we looked at understanding your environment; and in part three we examined how to stay flexible and be ready to make changes. In this final instalment, we consider the need to focus on your strategic priority.

During COVID-19, it was clear that companies that were able to focus on their strategic priority were able to respond much quicker to the changing context and new challenges posed by the pandemic.

There are five key strategic priorities you may focus on, depending on your industry, your level of development and resources, and what the next disruption brings you.

1. Accelerate: This is a “winner takes all” approach. We saw this during the pandemic with Spotify. The company accelerated, entered new markets, and made acquisitions and partnerships to capitalize on the position it was in with people staying home and looking for more entertainment and streaming options.
2. Diversify: Find alternative ways to create value. Uber went through this during the pandemic. It had to shift from being a taxi service to making deliveries with Uber Eats and other models that could bring new revenue streams.
3. Digitalize: Determine how to capture new value through digital. Walmart was not very digitally mature when the pandemic hit. While it did well because people still needed to buy food, it greatly expanded its ecommerce business and digital presence to fill the needs of consumers that the pandemic brought with it.
4. Reboot: Rethink your value chain for the future. The David Lloyd group of fitness centers had to shut down in many markets due to the pandemic. It created outdoor and virtual classes in response and now, even though it has been able to reopen most places, these new offerings are part of the value chain.
5. Refocus: Rebalance your activities and reallocate resources. Adidas did this, shifting to direct-to-consumer models with more selective brick and mortar stores and expanding its digital engagement with consumers.

The fundamental issue is that you cannot do all these things at once. You need to look at your business when a crisis hits and determine what need to be your top priorities, then focus on those that are key for navigating through the crisis and future-proofing your organization.