At the beginning of the year, I wanted to write a blog about what 2020 and the decade at large holds for us, but I was really overwhelmed with all the great articles that beat me to it.
Now 3 months into the decade a lot has changed and I am sure we all are experiencing the change COVID-19 is bringing into our lives. It’s not just our personal lives but the economy, businesses, and the broader global society which is experiencing the impact of this unprecedented global pandemic.
The world has seen many pandemics and plagues dating as far back as 5000 years in 3000 B.C. to some of the recent ones that we are all aware of like Spanish Flu (1918-1920), AIDS pandemic and epidemic (1981-present day), H1N1 Swine Flu pandemic (2009-2010), West African Ebola epidemic (2014-2016), and Zika Virus epidemic (2015-present day), just a to name a few. Each of these pandemics caused an everlasting impact on lives, ways of working and the society at large.
I am sure that COVID-19 will be no different, and while the loss of lives might be lesser than some on the previous pandemics (which is actually good), but COVID-19’s global reach will force us all to embrace significant changes in the connected world we live in.
COVID-19 has ensured that this decade will not only be remembered as the decade of change (as many have previously stated) but a decade that forced the emergence of a #RenewedSociety.
Here is a list of key trends I see panning out over the 2020-2030 decade.
1. Consumer spending will increase as people will live for now rather than save for the future. This will cause savings to go down and a ballooning of the middle-class debt. The savings rate in India is 17% (down from 30% a decade back). 10% out of this is in real estate \ gold. The liquid Savings rate is 7%, unfortunately, this will only go down. People will, on one hand, spend on consumer, convenience and lifestyle goods, and on the other hand, invest more in the equity market with the hope to make higher returns. The sale of electric cars will boom sooner than expected (as long as the charging infra can cope up).
2. People will live healthier lives. My belief is that people will choose healthy eating options and will focus on fitness. I can’t guarantee more Mr. and Miss Universe entries, but fewer doctor visits for sure.
3. Family bonds will become tighter. The current situation has forced billions to be locked-in and spend more time as families. Many have unfortunately lost loved ones, and I am deeply sorry for their loss, and I pray for the well being of all who are on the path to recovery. While we take relationships for granted, these trying times have certainly made us realize the importance of family and friends.
4. More will move into research as they will want to solve the problems of sustainability and healthcare. Many youngsters will select STEM subjects and select research with the aim to create a difference in their lives. While the past generations have done well, I guess the younger generations are right when they say, we should have done more. There will be a sense of urgency, and this will force the younger generation to innovate. We are already seeing many examples of Vaccine research, Ventilator production, Sanitizer production, innovations in health care, etc. in a short span of 2-3 months. This trend will last and as a result, we will make more progress in healthcare in the next 10 years than we have in the past 30.
5. Businesses will rage a “War on Waste” and will go digital. They will understand the importance of technology and use it to drive efficiency, increase safety, and improve productivity. While the 2008 sub-prime crisis forced many businesses to rethink business models and go frugal in their operations, this situation is unprecedented. Many industries like Commercial Aerospace, Rail, Hospitality, Travel, and Tourism will take more than 2-3 years to fully recover. Business models will get reinvented, as an example, with the number of people moving to a “Work From Home (WFH)” model, the demand for commercial real estate will reduce. In many firms, WFH will become the norm going forward. The risk-taking appetite for businesses is nearly lost and will take a while before it is restored to 2019 levels.
6. Businesses will better understand the value of employees and provide more. Working conditions will improve (at office or WFH), but there will be pressure on employees to deliver more in return. Mediocrity will not be tolerated as firms and managers, will want to achieve more in lesser time. There will be a high sense of urgency and the businesses that will survive will be the ones that truly love their employees.
7. Consolidation across sectors. With the financial implication due to the pandemic, many smaller firms, and startups will, unfortunately, go belly-up. This is a great opportunity to acquire firms for technologies, capabilities or just expansion at very attractive prices. This will lead to consolidation across the board. We will also see the emergence of many more unicorns, that are focused on solving specific problems.
8. Manufacturing will move back in-country. While COVID-19 cannot get all the credit for this trend, but it sure is a trigger for its acceleration. Many countries have been thinking of reducing their reliance on China and are looking to find alternate destinations like India. While this transition will continue, my belief is that many firms will take the bold step to bring back manufacturing to the primary countries and move away from outsourcing to captive models where they have a higher degree of overall control.
In 2008-09 we saw the emergence of the “New Normal”, I believe 2020 will see the emergence of the #RenewedSociety with Renewed Purpose, Renewed Focus, Renewed Vision, Renewed Bonds, and Renewed Urgency.
As we march beyond the pandemic, I believe it’s time to press the reset button, gear up and contribute to the “#RenewedSociety”.