Covid-19, the biggest test for governments and businesses’ digital strategy (especially if they didn’t have one)

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Covid-19 is testing the whole world in different ways: at a personal level, it is testing our ability to be patient and resilient; at a community level, it is testing our capacity of being more caring and less selfish; at a global level, it is testing us all on everything.

Our everyday routines have changed in ways we never thought they would. We have to follow a thorough hygiene process on something that we once thought was simple: washing our hands. We have to strategically plan how, where, and when to go grocery shopping. We must create an agenda to hang out with our friends and families in order to coordinate video calls. Our homes have now also become schools and offices.

These are examples of difficulties most of us are facing due to safety procedures introduced in order to try and control the spread of Covid-19, summarized in one word as quarantine. As the time in quarantine gets extended, it is becoming apparent that quarantines are more than just safety protocols. Quarantines are becoming visual evidence of who was ready to confront a global pandemic and who was not.

When talking about the readiness to confront Covid-19 quarantines, two actors are of enormous importance: governments and businesses. Quarantines have forced the majority of us to substitute office meetings with online meetings, street shopping with e-shopping, on-site seminars with webinars, personal interaction to digital interaction. However, not all governments and businesses have been able to make such changes, instead of substituting they have been suspending.

The businesses and governments that have been able to adapt have relied on one crucial factor: digital infrastructure. Those that had already put a digital strategy in place and that had been investing in digital infrastructure for years have been able to cope with this situation, allowing them to establish an efficient interaction with their customers, workers, and citizens. An efficient interaction goes beyond doing videoconferences or sending emails with information and safety instructions to be followed, it is about making the entity approachable, making their customers, workers, and citizens feel supported and giving them the tools to adapt to the situation and confront all obstacles. In this regard, the global pandemic is testing the digital strategy of governments and businesses in 3 core factors: i) infrastructure, ii) readiness to employ digital platforms and iii) engagement with workers, customers, and citizens.

For governments, “as first custodians” of information related to Covid-19, it is even more important to have an efficient digital strategy in place and be able to communicate with citizens and all government workers. In this regard, it is paramount for them to provide “accurate, useful, and up-to-date information to people, particularly in times of crisis” (UN, 2020). Using digital platforms to engage with the citizens enables governments to share information about the outbreak, travel restrictions, protection procedures, and even some governments have started publishing statistics (UN, 2020), an important step to enhance further research on the matter.

While some governments have been able to provide information on their national websites, mobile apps, or social media accounts, there are others that have not used digital platforms to interact with the citizens during these times of crisis at all. According to the UN, through a review of their member states, 110 countries had shared information regarding Covid-19 on their websites by March 25, while 83 Member States had not. By April 8, more governments discovered how useful it can be to use their websites as a tool to communicate with their citizens, and 57 more countries (167 in total) started providing information on the matter on their websites.

A government’s digital strategy during times of crisis requires strong and innovative efforts, meaning that governments can tap into the private sector and even call on the general public for help. One country that decided to adapt its digital strategy amid the crisis and use their citizen’s help is Finland. Sanna Marin, Finland’s Prime Minister, recruited social influencers in order to extend the outreach of information to the whole country. Using social influencers allows governments to bring better access to information for people who are harder to reach via “traditional channels”. Moreover, by working jointly with social influencers, the government can ensure that they share reliable information and avert the spread of deceptive information (Henley, 2020).

Sharing reliable information, especially during times of crisis not only helps people to understand the situation and take protective measures in a more effective way, but it also builds public trust. The pandemic crisis has spurred the need for digital government services and even the necessity to create new digital services. Some countries have seen an increase in the usage of their existing online services like digital ID and digital signature, mainly due to the boost of the applications for social benefit programs (UN, 2020).

Access to social benefit programs is essential and one of the reasons why governments need to strengthen their digital strategy during this crisis. As weeks go by, the economic distress becomes more visible and the need for social benefits will grow exponentially. Moreover, as social distancing measures remain in place, the predominant way to apply for a social benefit program is via web services. How could people apply for a program if they cannot reach a website, or the online platform simply collapses? Or, how could government workers guide a citizen on the process of an online application if they do not know how the application works or are forced to work from home without having a computer?

Government aid during and after this crisis requires a strong digital strategy because, without it, the aid may not even reach the citizens. Even the first steps for social benefit programs like an application can become a long and cumbersome process if a strong and efficient digital strategy is not in place.

Just like governments, businesses have been experiencing several difficulties in every aspect of their digital realm, especially the ones that did not have a digital strategy. Due to the global pandemic, even businesses that were reluctant to adopt technology have now been forced to do “Homeoffice”. While for some big companies like Facebook, Deloitte, Google, etc. this concept is even considered old, many other companies do not have the infrastructure to offer that possibility to their employees (Marr, 2020).

According to McKinsey & Company, even prior to the global pandemic crisis, 92% of companies believed that they needed to adjust their business models to achieve greater digitalization. One of the biggest challenges lies in human capital: training workers via online platforms is something several companies have always found difficult (McKinsey & Company, 2020), nonetheless that will be a crucial skill to develop.

In addition to adapting the workforce to the Covid-19 challenge, businesses are facing another crucial obstacle: new customer behavior. The stay at home measures have forced consumers to change their shopping behavior, and this new behavior is mainly digital. According to Sabrina Helm, a research professor at the University of Arizona, the growth of online shopping mainly for groceries is significant. Throughout all age groups, there is a considerable segment of consumers who tried online shopping for their first time in March 2020. Although at first glance this last point may seem like great news for grocery stores, most of them had to rapidly increase their online offers to a point where such service was still at a semi-experimental stage.

Nonetheless, there are some businesses who are coping well with this situation, especially the ones that already had a strong digital strategy in place. It is no surprise that companies like Amazon are making even greater profits due to the given circumstances. Although most people see Amazon as an e-commerce company, Amazon is also a cloud services company.

While Prime Video or Kindle may be more popular, Amazon Web Services (AWS), the company’s cloud computing subsidiary, is the cornerstone for Amazon’s success. AWS delivers cloud computing platforms not only for Amazon itself but for several other companies around the globe. Adobe, BMW, General Electric, HTC, McDonald’s, Netflix, Pfizer, Samsung, SAP, Siemens, among others, are registered as AWS customers (Sanders, 2020). It is almost as if Amazon had foreseen that such a critical event in the world’s history would force humankind to rely so strongly on digital platforms.

Already as of 2017, AWS was portraying itself to be “the secret of the online retailer’s future success” (Hern, 2017), today in 2020 we know that to be true. Amazon Web Services is such a strong part of Amazon’s digital strategy, that in fact, this subsidiary was Jeff Bezos’ goal since the first days of the creation of Amazon (Stone, 2013).

Moreover, a lesson for the people that want to build and create new companies during this crisis is to think about their digital strategy, even before all the other strategies. Like Amazon, a new company can be born by having its digital strategy as a catalyst in the first stage of its creation.

Looking into the governments and businesses that thrive and succeed in the Covid-19 era will be crucial in the upcoming months. No performance analysis will be complete anymore if it doesn’t include a section dedicated to digitalization. For the latter, the eternal discourse of governments and businesses having to work together to upfront difficult situations will be crucial.

Google already announced that they are planning to aid small and medium businesses to reach their customers better through their digital services. The help will come in the form of $320 million USD that will be used to give credits for Google Ads services (Gaeta, 2020). Aid programs like this could help small and medium businesses significantly to interact with their customers better during these times and build a stronger digital strategy. If made in joint action with governments, this program could have a stronger outreach and benefits for both the governments and businesses.

While Covid-19 is becoming the biggest test for the digital strategy of governments and businesses, it is also becoming their biggest catalyst for innovation. Sailing through this crisis with a robust digital strategy will not only be their life vest but also the reason they become the best version of themselves in the upcoming future.

“The views represented in this opinion piece do not necessarily represent those of the Willy Brandt School of Public Policy.”

References:

Gaeta, V. (2020). Google to help SMBs with $320 million in ad credits during coronavirus (Covid-19). https://www.impactbnd.com/blog/google-to-support-smbs-with-320-million-in-google-ad-credits-during-covid-19

Helm, S. (2020). Covid-19 has changed consumer behavior. What does it mean for the future?. https://uanews.arizona.edu/story/covid19-has-changed-consumer-behavior-what-does-it-mean-future

Henley, J. (2020). Finland enlists social influencers in fight against Covid-19. https://www.theguardian.com/world/2020/apr/01/finland-enlists-social-influencers-in-fight-against-covid-19

Hern, A. (2017). Amazon Web Services: the secret to the online retailer’s future success. https://www.theguardian.com/technology/2017/feb/02/amazon-web-services-the-secret-to-the-online-retailers-future-success

Marr, B. (2020). How the Covid-19 Pandemic is Fast-Tracking Digital Transformation in Companies. https://www.forbes.com/sites/bernardmarr/2020/03/17/how-the-covid-19-pandemic-is-fast-tracking-digital-transformation-in-companies/#5c4b684aa8ee

McKinsey Digital. (2020). The Digital-led recovery from Covid-19: Five questions for CEOs. https://www.mckinsey.com/business-functions/mckinsey-digital/our-insights/the-digital-led-recovery-from-covid-19-five-questions-for-ceos

Sanders, B. (2020).Who’s using Amazon Web Services? [2020 Update]. https://www.contino.io/insights/whos-using-aws

Smarter with Gartner. (2020). Coronavirus: CIO Areas of Focus During the Covid-19 Outbreak. https://www.gartner.com/smarterwithgartner/coronavirus-cio-areas-of-focus-during-the-covid-19-outbreak/

Stone, B. (2013). The Everything Store: Jeff Bezos and the Age of Amazon. Little, Brown and Company

United Nations Department of Economic and Social Affairs. (2020). UN/DESA Policy Brief #61: Covid-19: Embracing digital government during the pandemic and beyond. https://www.un.org/development/desa/dpad/publication/un-desa-policy-brief-61-covid-19-embracing-digital-government-during-the-pandemic-and-beyond/

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Almudena Nunez holds a Bachelor's degree in International Relations with a specialization in Business and International Finances from Anahuac University in Mexico, her home country. She has professional experience in energy and sustainability, technology adoption for human capital, congressional affairs, and space policy. Additionally, she has taken part in entrepreneurship projects in Mexico City and in Washington D.C. Currently, she is an MPP candidate with specialization on International Political Economy and European Public Policy at the Willy Brandt School of Public Policy