Why constant change must be the new normal for enterprises

What a difference a year makes. Just over a year ago, survival was the order of the day, imperilled by enforced at-home working, brittle supply chains, and rapidly changing customer expectations and buying behaviours. Some businesses, such as those in travel and hospitality, had to dramatically dial down their services or completely pivot practically overnight, while others, such as supermarkets, had to double down efforts to meet a huge surge in demand from their customers.Yet, as difficult as the pandemic has been for many businesses, it has also acted as a catalyst for cloud adoption and digital transformation. Over the last 18 months or so, we have seen more and more companies turn to the cloud To gain a better understanding of how enterprises managed to reinvent their business during the Covid-19 pandemic, without a roadmap for what was going to happen next, Amazon Web Services (AWS) commissioned a report which surveyed 10,000 senior business and IT decision makers. The title of this report, Reinventing Without a Roadmap, gets to the heart of the lessons learnt and provides insights into how these decision makers expect their organisations to build on their experiences and keep growing in a post-pandemic world. From reading the research, what’s clear is that painstakingly negotiated multi-year roadmaps might give a comfortable feeling of control but, if we are honest, they have rarely worked for the many business areas that are unpredictable and volatile. It is akin to believing we can predict and control the future.

Rapidly shifting consumer sentiment and social norms, sustainability expectations, geopolitical machinations, and macroeconomic uncertainty are piling pressure on businesses to do more, faster, without increasing costs. That’s why setting a bold north star and then iteratively delivering value in shorter time scales is fast becoming the pragmatic way of responding. This approach helps enterprises learn quickly and to deliver incremental value more predictably. The gap between business responsiveness and consumer expectations is widening for enterprises that cling to legacy ways of working. As a consequence, they will also be challenged with attracting and retaining staff. Frankly, who wants to work for a company where you lack autonomy, mastery, and purpose, when others allow you to grow and develop?

This is a wake-up call for those who are leading transformation in their organisations. If your pace hasn’t quickened, you are likely being outpaced by the many enterprises that have, on average, accelerated their transformations by almost two and a half years. New entrants are also taking market share. According to the research, almost half of business leaders said new entrants in the market were able to move quicker in adopting cloud technologies and have seized market share.

What I find particularly striking in this research is how the majority of leaders have understood that the greatest threat to them thriving is not change, but the status quo. We have learnt that it was better to disrupt ourselves than to have the market, world events, or competitors do it to us. Businesses are now better placed to keep flourishing in the new competitive landscape. 69 per cent of business decision makers said they have a clear strategy to seize opportunities.

Across many economies, organisational complexity has outstripped business complexity for decades. Initiatives to address this moved the needle in too few organisations. Yet the crisis of the pandemic triggered a response in companies that has pushed aside the status quo out of necessity: trusting employees, taking calculated risks to learn quickly, and rapidly scaling successful experiments or pivoting based on learnings.

Many of the business leaders we surveyed told us that their organisations stepped up to the plate and embraced agility as a competitive advantage, learning quickly with their customers rather than blindly executing a roadmap based on assumptions and desires – with no roadmap to guide them. It is a combination of culture, leadership, and technology that has differentiated companies’ progression through the pandemic. The crisis was a wake-up call to many that customer-obsessed, agile decision making triumphs over slow, introspective organisations. It’s not just about reacting to crises, but about continually responding to and delighting customers. Despite 90 per cent of companies facing difficulties in understanding and meeting new customer demands, only 50 per cent of organisations expect their businesses to continue to transform. Transformations are never done, else the status quo reasserts its hold.

Success will belong to those who capitalise on these learnings and grab the future with vigour and agility. Yes, the cloud features here. If you had one million more pounds, euros, or shekels, what would you spend it on? Would you build your own power plant? After all, electricity is essential to your business, right? Of course not. Others do this more cost effectively, reliably, and securely, freeing up your time to focus on creating competitive differentiation. The same is true with the cloud. It breaks your dependencies on endless license negotiations, expensive investments in data centres, and a cost-driven reluctance to experiment, while improving your reliability, scalability, and security. It liberates your employees to innovate.

While the new breed of business that has emerged from the covid-19 pandemic recognises its ability to be more agile, it must not take its eye off the issues at hand. Looking ahead, it will be crucial for enterprises to maintain their focus on reinvention, ensuring the status quo doesn’t stand in the way of transformation.

Phil Le-Brun is the director – enterprise strategy at Amazon Web Services