Recent progress with coronavirus vaccines and treatments appear to have raised expectations for the world's economic recovery in the second part of 2021 (“Global Economic Prospects,” The World Bank, January 2021). While we may be eagerly awaiting a return to some sort of normalcy, we at Expandigo hope we are correct in believing that some of what we’ve learned and how we’ve adjusted our business practices will bring lasting changes to the world economy.
Of the many things we’ve learned this past year about how to address global crises, we see three main lessons:
No government or business can work independently to address the social and economic challenges caused by the pandemic. By working together with a common objective, governments, public and private organizations across the globe can achieve results that are exponentially greater than their individual efforts. The fact that multiple Coronavirus vaccines are now available is largely because governments, private companies, public and private organizations have focused their combined resources to address a shared threat. One successful model during this time has been the creation of the COVID-19 High Performance Computing Consortium that brings together governments, academia, private tech companies, research laboratories, and others to enhance and accelerate research. Another example is the innovative collaboration between the University of Oxford and Astra Zeneca. In order to defeat the pandemic, it will be imperative for the wealthier countries to help ensure that vaccines are equally distributed across the world. “Me first” individualism is rarely a good strategy, and even less so in an interconnected world.
Companies, no matter their size, must continually reassess the way they operate, build trust, and create value for all their stakeholders and not just their shareholders. This means that a company’s aim for profit must be balanced with efforts to help address and ameliorate society’s biggest challenges (social inequalities, race-, gender-, and identity-based discrimination, climate change, access to education, and more). This adds long-term benefits to communities in which these companies operate, which in turn can helpcreate and sustain a more vibrant and stable economy. In “Measuring Stakeholder Capitalism: Towards Common Metrics and Consistent Reporting of Sustainable Value Creation”, a white paper from the World Economic Forum (September 2020), authors suggest that companies focus on four main pillars:
A company’s stated values and mission need to be backed up by their decisions and actions. In addressing the needs of all stakeholders, and not just the shareholders, a company can achieve its best form and actually live up to its mission and vision.
The pandemic has confirmed the important role that SMEs play in their communities. It has also highlighted the economic weaknesses created by continued globalization and limited government regulation.
SMEs thrive when they are fully integrated into global value chains, but it’s unlikely that many will have the resources necessary to rebuild these connections in a post-pandemic environment. As trade and supply chains reopen, SMEs will need support to connect and compete; technology, infrastructure, and tailored short, medium and long-term financial support will allow SMEs to innovate and subsequently power local and global economic recovery.
For many SMEs, investments in digital technology have been essential for survival during the pandemic. Moving forward, these same technological advances will be important to creating new business opportunities as SMEs strive to reach global markets and take advantage of the push toward economic recovery.
A recent article from McKinsey & Company (“Setting up small and medium-size enterprises for restart and recovery,” June 2020) suggests that governments’ interventions should focus on four main actions:
Integrated ecosystems give SMEs easier access to data, resources and connections, We at Expandigo believe that supporting the recovery of SMEs will establish the foundation for a sustainable, more equitable long-term growth strategy as we continue with and emerge from this pandemic.