How COVID-19 is transforming organisational effectiveness

It has been more than 6 months since the global coronavirus pandemic struck – and the disease doesn’t look like it is going away any time soon. Like it or not, COVID-19 will have a lasting impact on the way businesses are run. It is therefore important that leaders understand the implications of work trends that have emerged, and how these will affect the achievement of strategic goals and business plans.

In today’s article, we look at how COVID-19 is impacting businesses in terms of organisational effectiveness.

  1. “Asset-light” – the new buzzword. The asset-light model is one where businesses own relatively fewer capital assets relative to the value of its operations. This model is most commonly adopted by tech start-ups like Grab and Airbnb where only core operational functions are owned by the company and all other assets like delivery vehicles and personnel, property, and even manufacturing equipment, are either leased, outsourced or co-owned. As businesses continue to get hit hard by social restriction measures, more and more brick-and-mortar companies are exploring ways to pivot towards the asset-light model to reduce customer acquisition and operational costs, and for long-term sustainability.

  2. Expansion of workflow automation & data collection. An analysis by Gartner showed that 16% more companies globally are using technologies to automate their workflows, monitor output, track productivity, and monitor client engagements and employee well-being. While companies have been looking at automation and data analytics to improve their overall performance even before the pandemic, the onset of COVID-19 accelerated technology adoption even for ‘traditional’ industries. Moving forward, workflow automation and data collection will expand even further as companies continue to streamline operations, collect and monitor information like employee health and safety data, and explore metrics that give them an overview of their organisational performance.

  3. Remote working will continue to increase. Prior to COVID-19, about 63% of employees in Singapore were working away from the office at least once a week, according to a 2018 study. With the imposition of Circuit Breaker measures in April 2020, more than 80% of Singapore’s workforce have started working from home (WFH), and the current default arrangement is for all Singapore companies to make WFH arrangements the norm, unless there is “demonstrable need” for workers to work at on-site premises, according to the Ministry of Manpower (MOM). Singapore is still in phase 2 of economic reopening, and it is likely that companies may still retain remote working arrangements even after the economy enters phase 3 reopening.

  4. Separation of critical skills & roles for employees. Before the current pandemic, critical roles were regarded as roles with critical skills or capabilities that an organisation needed to meet its strategic goals. With the current situation, businesses are increasing realising there is a difference to the critical roles required to ensure the success of essential workflows, and critical skills that are needed to drive competitive advantage and sustainability – in other words, critical skillsets and competencies are no longer exclusive to employees in critical roles, but required equally by all employees in order to ensure sustainability of the organisation in the long run. Such skills include in-depth competency, technology use, critical thinking, and ability to work effectively in small flexible teams.

  5. Shift in focus from efficiency to resilience. Before COVID-19, businesses and organisations were pretty much stuck in the industrial-era mindset of scientific management, command and control, and work process design focused on achieving productive efficiencies. While this approach has led to streamlining of roles, supply chain and workflows to achieve operational cost savings and increased productivity, it also created fragilities, or the inability of systems and organisations to respond to disruptions. Fragilities have become especially glaring with the onset of COVID-19, and companies are realising the importance of being able to remain flexible and be responsive to changes in order to correct course or pivot quickly. Organisations are likely to design roles and structures around agility and flexibility to ensure greater resilience, as opposed to purely focusing on efficiency in a post-COVID 19 world.

  6. Outsourcing & contingent hiring will be the new norm. Economic uncertainty in the wake of the pandemic has caused massive job losses and exposing many workers to non-standard work models for the first time. A research by Deloitte showed that more than 35% of organisations globally are replacing full-time employees with contingent workers or outsourcing non-core business functions to professional contractors. As companies continue to find ways to reduce costs and adopt asset-light business models, they are likely to continue to expand the use of outsourced contractors and contingent workers in order to maintain workforce management flexibility.

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