Could the world re-establish the same pre-COVID-19 normalcy? Chances are the probability of living the same life that prevailed in 2019 is relatively low. Individuals and businesses have learnt to adapt to uncertain situations during the pandemic; and will be called to adjust to a different new normal.

McKinsey and Company gives business leaders some clues as they are getting ready to head towards the new normal.

On consumption

Consumers and shoppers have been used to almost desert malls and closed stores and doors. As we are gradually moving out of the pandemic, can businesses bank on “revenge shopping” anytime soon? The answer will depend on how consumers’ confidence is restored, and how they feel about the future. McKinsey’s survey reported that countries with younger populations such as India and Indonesia are more optimistic than their European peers with older demographics like France and Italy. China recovered earlier than any other country and consumers managed to behave quite like during the pre-pandemic. However, in the United States, a slight and cautious return to buying habits has been reported. Indeed, consumers’ attitudes will vary from country to country according to the restrictions and lockdowns still in effect.

On travels

“Do not travel unless it is for essential purpose.” This has become governments’ daily messages during lockdowns. The recovery of the travel business will depend on how confident travellers are in one country’s health and safety measures. In China, travel companies reported that only domestic travels bounced back, with leisure outperforming business trips. McKinsey notes that historically, business travels always take more time to rebound; and it would be more realistic to predict that regional and domestic business trips will recover first. In the mid-term, travel companies will rely more on leisure travellers, and less on business people, considering that technology showed evidence that some trips are not that essential, and businesses would rather avoid unnecessary travel expenses. In the long-term, this trend can become irreversible.

On innovations

Entrepreneurs who were bold enough to propose innovative and adapted solutions stood out. In the third quarter of 2020 alone, 1.5 million new business applications have been recorded in the United States, almost double the figure for the same period in 2019. The chaos caused by the health crisis on small businesses was somehow counterbalanced by a positive trend in entrepreneurship.

On digitization and productivity

Digitization has seen tremendous growth in a matter of a few months, and no stepping back is possible. Technology helped businesses to be even more productive, and there is a huge chance that companies’ responses to the crisis will be sustained. For example, establishing virtual options can become a norm for healthcare. Everyone should keep their eyes open on new opportunities and trends and should invest in learning new skills that the labour market may demand.

How companies manage their operations has drastically changed during the pandemic, but change can be a driver of greater productivity. What we thought would be temporary becomes permanent, and that is the new normal.

Source: McKinsey & Company