By Richard Eglon, Marketing Director of Agilitas
The current pandemic has driven the need for innovation more than ever before. Around 75% of organisations reported disruption in their supply chains due to COVID-19, and forecasts and predictions suggest that we will have to adapt to a ‘new normal’ rather than relying on things going back to the way they were. If the IT channel is to survive this crisis, it will have to innovate and adapt.
Recent research conducted by Agilitas looks into the innovation in the global IT channel, and found that nearly half of respondents said that their businesses were already innovating their contracts and commercial models, and more said they were pursuing digital transformation.
Impact on the channel
Due to the COVID-19 pandemic, the channel has experienced a global disruption like no other before. IT businesses have become largely reliant on the decisions made by their countries’ government and distributors and their associated partners have suffered from the domino effect of supply deficiencies, as well as a range of global interruptions impacting all vertical markets around the world. During this period of uncertainty, distributors have sent out warnings of delays and shortages. Vendors have also been distributing messages to their channel partners informing them that hardware and parts shipments could take over three times longer than usual to be delivered, depending on where they are based.
Within the first few weeks of lockdown, all businesses focused around crisis management due to these challenging times. As this is something that no one has ever experienced before, businesses have had to adapt to unprecedented disruption with no rule book to guide them. During this time, companies and their customers have been working closer than ever to make sure they build a stronger business to survive when exiting on the other side. To stay on top, businesses have had to think on their feet.
In terms of supply chain, the channel has had to adapt to new changes and challenges to keep businesses flowing. Although crisis management was the initial priority, organisations should now begin to look at how, and where, they can place innovation within their company. This includes how they can better serve their customers and how they can continue to support them during these challenging times.
Innovation as a solution
To grow from this global pandemic, channel businesses must continue to react to problems in an agile manner and work out how they can adapt to customer needs in different ways than before. To do this, the channel needs to make sure that they remain relevant to their customers and innovate in the same direction as their customers demands. Recent events have driven businesses and their people closer together than ever before, even though employees have been working remotely they have never been more connected with their colleagues.
When innovating, businesses must remain confident, optimistic and dare to be brave. This will drive change in the company, across the industry, and all those who support the supply chain. If companies feel less positive about the future of the industry as a whole, they will be more hesitant to innovate and be more likely to follow the status quo. Businesses must remove the idea that innovation might become a reason for decline or distraction from existing business practices and think about how it can positively affect the company, including its reputation and execution. Additionally, those in the channel should not feel threatened by bigger companies who are innovating on a larger scale. This could simply be down to the fact that with more employees, they have more people to dedicate towards innovation. However, innovation can be adopted in different ways depending on the company size. For example, smaller businesses may innovate in a way that is more aligned to customer requirements therefore be more dynamic resulting in a greater impact on the business outcome.
Coming out of COVID-19
When the COVID-19 crisis eventually passes, we are likely to see a high percentage of businesses returning to their old ways of working. However, they should use this learning experience to continue their innovation journey by integrating continual improvement programs into their overall business strategy. The companies that innovate during and after the global pandemic will find that they will obtain a higher level of trust and loyalty from their customers. This will increase the level of trust within the workspace which will help people share ideas, meaning a stronger business in the long run. By allowing team members to take time to explore and discover, their ideas will propagate a culture of innovation. This is also a good way to show teams that they are valued, and help them grow and upskill, by providing time and budget for them to grow and prosper. This situation will also allow employees to be more transparent with those around them. Innovation doesn’t always have to be a big change. It can be a number of small adjustments which may lead to a greater outcome. Businesses within the channel need to recognise how they can help and serve their customers in the best way possible.
In a recent survey, respondents rated the ‘importance of innovation’ 8.4 out of 10 of importance. However, participants with mid-level manager job roles answered 5.9 out of 10 on average. These results suggested that those with a lower-ranking role within the company may not fully understand what change means to them. For businesses to successfully achieve a culture that embraces change, companies must stay in constant communication with their employees and make sure that the messages are communicated in a coherent and consistent manner. If not, businesses may find themselves in a situation where the most senior people understand and act on the importance of innovation with no conscious support from the whole organisation. Therefore, it will never achieve its overall goals.
The COVID-19 legacy on the channel will be catastrophic for those firms who haven’t embraced innovation during the pandemic. This has been an extremely challenging time for the channel, and there has been significant changes to the rules of engagement which have affected the majority of channel companies. Even faced with these unprecedented challenges the IT channel has been able to stay resilient by continuing to innovate and provide relevant solutions to their customers ever-changing needs. The channel is known for its resilience and over the years it has been able to adapt and survive many disruptive events. Unfortunately with COVID-19 there will be some channel firms who meet their nemesis, however, those who ensure innovation is in their DNA will not only survive but thrive in the new world.