At Plutoshift, we work closely with companies that drive our economy such as manufacturers, service providers, warehouse operators, distributors, and logistics providers. As we approach the tail end of 2020, we wanted to know — How are companies managing their work amidst the chaos? Here’s what we learned:
#1. Seemingly disconnected sectors are not as immune to each other as they previously thought
2020 has been cathartic when it comes to thinking about digital transformation. It went from being “nice to have” to “must have” as businesses try to prop themselves up and innovate as a way of surviving. With the pandemic, we’re seeing more clearly how intertwined and co-dependent various industries are. There’s a chain reaction that happened throughout this pandemic:
People can’t go out as much, so sectors such as travel and restaurants got decimated. People are losing jobs, so they can’t afford to spend money on items outside of non-essential goods. Sectors such as entertainment and luxury goods also got decimated given closures and the sheer fact there is nowhere to go outside of our homes. Companies that service these sectors such as oil & gas and farming are being impacted due to the supply chain disruption.
These sectors support businesses that make this country thrive, but they are facing strong headwinds due to the chain reaction. The market conditions gave rise to this particular chain reaction and it impacted a specific set of sectors in a strong way.
#2. Companies that provide essential goods are doing well
In turn, we have seen that there are certain sectors that are thriving and less sensitive to the economy. In the middle of all of the pandemic chaos, there was a shortage of products due to the demand going up quickly as people prepared to be sheltered in place. A boom in sales continues for grocery stores, packaged goods companies, and Amazon as consumers are spending money on essentials like food, soap, toilet paper, and canned goods.
Figuring out how to be essential to your customers is a good way to survive any downturn. We’ve seen many companies reinvent themselves through manufacturing items that are needed including PPE materials.
#3. Ramping up capacity in the physical world is not nearly as easy as ramping up capacity in the cloud-software world
When a cloud-based software needs to provide service to more users, you just spin up more servers on your cloud infrastructure. But it’s very different when it comes to the physical world! The consumer goods companies provide products and services that people use on a daily basis. Now they have to produce more per day in the same facilities with the same number of people.
This means there are more moving parts in the system now — more units to produce, more resources to consume, more processes to keep track of, more anomalies that they need to anticipate. In order to keep up, they need to monitor everything — prioritize what needs their attention, get to the root cause, and estimate what’s coming up next. It’s very difficult to do all this work manually. They need an automated tool to do all this!
#4. Digital transformation needs to bite-sized
Companies that produce physical goods have realized that they need digital tools to get their work done. These tools help them do a variety of tasks like collect data, produce reports, predict anomalies and monitor the performance of their operations. They’ve realized that automation has become a business imperative and that data plays the central role in that initiative. Since companies nowadays don’t have time to do a 5-year project, they need to pick the processes that can be digitized one by one. More and more company leaders are finding ways to enable their individual work practices and processes which we expect to be a continued trend.