A coronavirus vaccine may be on its way - but that doesn’t mean the world will return to how it used to be any time soon.
Hopefully, the intermittent lockdowns, social distancing, and crushing restrictions on the hospitality sector won’t go on for too much longer. But it’s also clear that some things have changed permanently. Many businesses are already thinking about what’s been dubbed ‘the next normal’ - and what it might entail.
According to one recent report, this next normal is likely to mean many businesses accelerating their cost reduction targets as we move into 2021.
But reducing costs at a time when revenues may already be taking a big hit from covid-related lockdowns is a difficult problem to solve. Our own data found that by just April 2020, the covid crisis had cost UK SMEs over £277,000 each. And it wasn’t just a short, sharp hit. By September, 47% of UK businesses reported their turnover had decreased compared with what is normally expected for the time of year, according to the ONS.
So, companies in the UK are looking to improve productivity at a time when they don’t have much cash to play with.
Reimagined business models
The solution to this puzzle will likely require many businesses to look at their core competence - the very fundamentals of what they are here to do.
The first of these business fundamentals likely to have to change is the idea that companies need an office. In fact, rental prices in commercial centers like London are in freefall as everyone from SME owners to multinationals begin to realize that the huge capacity and floorspace required by hundreds of workers every day will likely never be needed again.
Video conferencing tools like Zoom and messaging platforms such as Slack have already made many of the meetings we used to take in offices easier to do remotely. And a raft of collaboration tools and cloud computing capability means much of the actual compute and server capacity we need is accessible online.
Actual offices will probably become spaces simply for people to interact, collaborate, and brainstorm ideas - with much of the day-to-day deep work done at home.
Another area that business will continue to rethink in a post covid world is HR. Up until the pandemic hit, any new work would likely be completed by a new hire who would be expected to work in the vicinity of the rest of the company. Obviously, for new staff, this meant going to work in the primary office building. But for freelancers and contractors, too, it often meant being hired by a contact in a similar physical location, going to meet them in an office, and, frequently, taking a desk and doing much of the work right there.
That’s all changed. Businesses are reluctant to make new hires when revenue is unreliable, so are increasingly turning to freelancers to fill the skills gap. And the physical location of those freelancers is almost irrelevant.
The third change to the way we do work is likely to be the most seismic - and that’s a revolution in purpose and strategic thinking. The changes to the where, when, and what of our working lives is going to cause a fundamental reshaping of the why.
Increased atomization of jobs and outsourcing of freelance talent for niche tasks will mean many businesses shed units that are unproductive and focus ruthlessly on their core competency.
This revolution will not just affect hiring decisions - it’ll run right through the core of a company’s DNA. When physical location is no longer paramount, a company can do anything. But that doesn’t mean they should do everything. Sprawling office-based businesses with huge numbers of mostly-unused one-person teams will surely be a thing of the past.
Why hire a developer and use them three times a year, when hiring one through a digital platform is easier, cheaper, and results in better work?
Far better to zero in on what your business is actually there to do and focus on doing it excellently, with staff who are fully engaged, efficient, and utilized.
A core team of full time staff will likely be augmented with a plethora of freelance specialists dropping in and out as required
This new streamlined way of working will reduce costs and increase performance dramatically, as great companies become more efficient, flexible and focused.
- Liron Smadja, Senior Director of Global Brand Marketing & International Expansion for Fiverr.
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