It’s nothing short of upheaval as firms adapt to changes from the devastating pandemic that sweeps nations. Even with ongoing vaccinations, mutated variants of the virus mean that the pandemic is staying longer than expected.
As the operating landscape and consumer demands change, new business models arise. The service industry, which usually sees more localised operations, is now going into the cloud. For example, across the Southeast Asian region, companies such as Grab and Gojek, which started with ride sharing, and then food delivery, amongst other services, are investing in “cloud kitchens”, which are central kitchens preparing food for delivery rather than for dining in. Traditional restaurant chains, are of course, entering the cloud kitchen space as well. Such industrialisation of the restaurant industry creates competitive advantages based on economies of scale in the sourcing and “production” of food, rather than in the dining-in experience.
In the area of training and education, online education providers like edX and Coursera that offer massive open online courses, are also upending the traditional university education. With restrictions on travel and movement, students have found it harder to gain the full university experience, and are willing to consider alternative options. While top-tier universities continue to do well with branding and their signaling effects to employers, many other institutions have faced declining enrolment.
Even consumers are getting on the act of leveraging economies of scale. People who live in the same vicinity get together to form group buying communities where purchases are pooled together to get lower prices and delivery cost. Last year, group buying platform Pinduoduo surpassed Alibaba in the number of active users. In Singapore, ground-up group buying has also taken off, and there are also initiatives for hawker centres to allow customers to consolidate their orders from different food stalls as part of the same delivery.
As the world adapts to the pandemic, mature industries will favour larger companies with economies of scale or brand recognition. Still, there are many opportunities for nimble companies that can capitalise on emerging trends.
Cityneon is a Singapore-headquartered company that took a traditional neon display business and transformed it into a global experience entertainment company, providing interactive and immersive experiences using movie IPs like Jurassic World and Avengers, combining both creativity and technology in an era of electronic entertainment. With travel restrictions constraining tourism, it worked with the Peruvian and Egyptian governments to bring experiences of Machu Picchu and Ramses the Great to cities all over the world, creating exhibitions with both actual artifacts and interactive displays.
Another company that has jumped on the transformation bandwagon is health tech company Ssivix Lab. It started in 2017 with itsMyCLNQ app, an online digital health platform for patients to book doctor appointments or ambulance services. When the pandemic hit, the company quickly pivoted to include telemedicine capabilities where patients can do online consultation with doctors in their preferred language, and have medicine delivered to their doorstep. It is also adding on additional services such as scheduling appointments for company health checks and swab tests. From Singapore, it has since expanded to Cambodia, India and Indonesia.
The examples show that change is possible. Amidst the pandemic gloom, some companies have managed to adapt and come up with new initiatives and innovation. The pandemic has accelerated the transformation and digitalisation of industries. While many of these trends had already started beforehand, traditional industries will continue to see more upheaval in the short and medium term.
The article is an abridged version of the one first published in SCMP.