Immediately after WW2, Japan’s economy was in ruins. Years of bombing campaigns turned the country’s ports, cities, and factories to rubble. Despite the poverty and decimated production capacity, the period of Japan’s history is now called the “Japanese Miracle,” because of the rapid economic recovery that within a few decades would see Japanese cars, electronics, and culture touching every corner of the world.
The period immediately following the war created unique opportunities for entrepreneurs who were able to find solutions to problems created by the economic crisis. One of these entrepreneurs was Tadao Kashio, who invented a small device called the Yubiwa pipe: a ring worn on the finger that held cigarettes and allowed wearers to smoke while using both hands to work, and also reduced the amount of pricey tobacco they wasted in each cigarette. It’s an antiquated problem by today’s standards, and while I don’t condone smoking (especially not while weaving textiles or mixing flammable chemicals), the Yubiwa pipe was an important invention because it served as a launching point for the global company that still bears Kashio’s name: Casio.
When I think of the economy today, I can’t help but think of Casio. They turned a simple invention made for a very specific moment in time into an enduring and innovative brand with decades of staying power. In the coming year countless companies will rise in capitalizing on the pandemic economy, but will they be able to adapt and remain relevant in the long haul? If they can keep the following things in mind, they may have a chance.
Is it a product, or a company?
If you’ve ever watched Shark Tank, this question might sound familiar – and for a good reason. Almost everyone has an idea for a product they could bring to a market, but building operations that can improve upon products and market them to drive consistent revenue growth is what makes a company.
Since the start of the pandemic, a category of consumer product that has exploded rapidly is protective face masks. Scroll through social media and you’ll likely see ads for masks in different styles and colors, some of which may feature sports team logos or characters from movie franchises. These are brilliant and rapidly moving up-start businesses that demonstrate the power of entrepreneurs meeting consumer needs while accommodating differences in tastes and preferences. But if these entrepreneurs expect their businesses to last beyond the pandemic, it’s time for them to start looking for what’s next.
Eventually, (if not already) most households will have their mask needs met. Even further into the future, the pandemic will end and masks will no longer be necessary in day-to-day life. The difference between the firms that will successfully pivot after the pandemic and those that won’t is whether or not their leaders are already analyzing trends and developing new products that will keep them relevant.
It’s safe to say that Casio still wouldn’t be around today if they stuck to their original product. Instead, they foresaw the growth of consumer electronics and pivoted their efforts to seize upon a new category. When you’re planning your business, make sure you plan for the current conditions and the Next Normal.
Is your market set for a long-term disruption?
The above problem has a polar opposite, which has the potential to be equally problematic for existing firms. That’s viewing the pandemic as a speed bump in their strategy rather than a prolonged new normal and failing to adapt. Airbnb is an example of a company that has rapidly reinvented itself, pivoting its marketing away from vacation and short-term rentals towards helping renters find apartments and houses for longer stays. In their case, accepting the new normal quickly put the company on a steep V-shaped recovery while other hospitality brands were being hammered by the pandemic.
Executives can’t live in denial about how COVID-19 will affect their market. Those in events, travel, and hospitality may especially need to rethink the fundamentals of their business models. Even when the pandemic does end, the “stay home economy” could produce a long-term shift in consumer preferences that sees more virtual events, less travel, and fewer nights out on the town. Businesses should be conducting customer research now and trying to predict how their market will evolve, and designing products and revenue strategies for a post-pandemic world.
Will collaboration be your savior?
The true reason that Japan recovered from WW2 so rapidly wasn’t a miracle. It was a masterfully managed economic strategy that included aid from policymakers and the collaboration of private sector groups called “keiretsu” that included suppliers, manufacturers, and banks with a shared interest in increasing the value of each other’s shares. These collaborations created close alignment between the market and supply chains that helped meet the country’s reconstruction needs while also rapidly capitalizing on new business opportunities.
Making it through the pandemic and thriving after might require looking outside your own scope of expertise and leveraging partnerships. Leaning on the expertise of established players in a space is generally faster than building a competitive solution from scratch, so don’t write off the speed that partnerships can provide in reaching new customers rapidly and bringing them value in inventive ways.
Prepare for your own miracle
Regardless of how you plan on steering your company through the pandemic, execution is either going to be your secret weapon or your downfall. Employees are working remotely and likely will for the foreseeable future, so building alignment to pivot your business model and pull off major changes is going to take more effort than ever before. It’s critical that businesses invest in the technology that creates visibility and accountability between your leadership and teams. Working quickly, accurately, and clearly is essential to moving with the urgency necessary for these pressing times.