What do health crises (like the covid-19) mean for business development in terms of new service offering: Threat or Opportunity?
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What do health crises (like the covid-19) mean for business development in terms of new service offering: Threat or Opportunity?
Global pandemics typically alter the normal trajectory of human activities, including businesses. Various health crises have been registered in the recent past. The World Health Organization declared the outbreak of coronavirus in March 2020. And since then, there have been surges in the disease cases, thus causing thousands of fatalities daily. Implications of the pandemic are still unfolding as businesses explore ways of combating the effects of the disease. With the shift in normalcy, changes have occurred in businesses, especially in terms of service offerings. There are threats as well as opportunities being created for business ventures. Some of the threats faced by businesses include the disruption of the flow of goods and services due to the massive lockdowns implemented to curb the spread of the virus. Some potential opportunities are the adjustment in the production base to provide services in response to consumer behaviors, provision of massive donations to the vulnerable population, and the creation of reliable logistics by reputable companies such as Amazon. Besides, the massive utilization of technology to provide services is another opportunity that has been utilized during this pandemic. In as much as having posed threats for business ventures, global health crises have created opportunities in terms of new service offerings.
The surges in the coronavirus cases prompted governments across the world to adopt various measures such as massive lockdowns to curb the spread of the disease (Steinmetz, Batzdorfer & Bosjank 2020, p.2). The German government also adopted this strategy to reduce the transmission rates by diminishing personal contacts and banning social gatherings ((Steinmetz, Batzdorfer & Bosjank 2020, p.2). Such measures, however, affected business ventures as the flow of goods and services are disrupted. Also, there has been a drop in the provision of non-essential goods and services (Hartman & Nickerson 2020, p.1). This trend may be attributed to restricted movements and also, lack of cash to purchase these items as many people have been laid off their employment. As asserted by (Hartman & Nickerson 2020 p.3), most tourism-related businesses have shifted their operation schedules to cut down the running costs. As such, the service provision of such companies will change immensely.
As earlier mentioned, human history dictates that health crises such as corona are pivotal in improving societies. Therefore, opportunities have been presented to businesses to advance their modes of operation to increase their profits. One of the most crucial changes in companies that have been noted is the adjustment in the production base (Liu, Lee & Lee 2020 p.279). Such strategies are enacted to ensure that businesses cope with the uncertainties in the market and grab new opportunities (Xing et al., .2020, p.1). Many firms globally have responded to the crisis by engaging in new entrepreneurial activities to meet the current customer demand. Some of these shifts have successfully assisted in the management of the pandemic. Companies that have embraced such changes include the distillery companies in Canada and Australia who began producing hand sanitizers. Other firms such as H&M and Zara have also started providing protective supplies such as gears and gowns used in healthcare delivery settings.
Besides, some businesses have utilized the opportunity presented by the pandemic to produce goods and services within a short period. As asserted by (Maritz et al. 2020 p.2), the coronavirus has led to the shaping of the services offered by most businesses. Therefore, manufacturers have been presented with the opportunity to transition the production of goods and services in response to consumer behaviors (Liu, Lee & Lee 2020, p.279). At the same time, the producers have globalized their export markets. As asserted by (Itiani, Jaramillo & Paesbrugghe 2020, p.1), consumers have become more demanding in recent years. As such, manufacturers work towards their satisfaction. In this case, goods and services are provided based on the consumers’ value and experience.
Companies have gained reputation by making significant donations to vulnerable populations. The management of global pandemics is usually complicated; therefore, it requires various stakeholders’ combined efforts (Chen 2020, p.1). Businesses have been shown to play a pivotal role in humanitarian actions. According to (Chen 2020, p.1), the combined contributions of global enterprises amounted to $300 million during the 2014 Ebola outbreak in various parts of Western Africa. Currently, some companies have also assisted with multiple donations. An example is the Razer company that deals with gaming hardware but has since devoted some of its manufacturing lines to produce surgical masks that have been donated to healthcare practitioners globally. Such incidences indicate that most manufacturers are playing huge roles in combating the pandemic by providing short-term solutions. Messages of collective responsibility of different members of the society have also created awareness on companies concerning their need to participate in such activities (Ebrahim, & Buheji 2020, p.297). Such opportunities of demonstrating good citizenship enhance the reputation of the companies involved as consumers will likely consume their products.
The pandemic has created an opportunity for big companies like Amazon to create reliable logistics solutions for small business ventures. If such companies fail to provide such solutions, then the competing companies will have the upper hand in the market. Reputable companies such as Amazon are recognized worldwide for its expertise in e-commerce. Therefore, it is expected to provide affordable and reliable logistics during the period of a health crisis (Roberts et al., 2020). Failure to meet such expectations will lead to the development of competition from such firms and the eventual loss of customers. Researchers postulate that such firms may enable the physical interaction of buyers and sellers. Besides, the service provision will change, allowing the timely delivery of goods and services. Therefore, the pandemic created an infinite opportunity for reputable companies to assist small ventures in their business quest.
Technology has largely impacted the service businesses. According to (Dannenberg et al. 2020, p.543), the health crisis has accelerated online trade. In a country like Germany, online food trade has moved into a phase of immense growth as companies adopt digitalization (Dannenberg et al. 2020, p.549). This trend can be attributed to the restrictions imposed by governments to mitigate the spread of the virus. Entertainment provided online is another business venture that has received a significant boost during this pandemic as most people are indoors. Therefore, they spend time on entertainment sites. Businesses dealing with telehealth smartphone applications have begun increasing in various parts of the globe. Multiple governments have adopted mobile phone applications for contact tracing of exposed individuals (Cho, Ippolito & Yu 2020, p. 1). Such information is kept confidential with authorized access by relevant authorities. Therefore, companies that are competent and swift in providing such innovations have a strategic advantage over their competitors.
In conclusion, the health crisis immensely alters the trajectory of major human activities. Coronavirus was declared a pandemic on 11th March 2020, and since then, there has been a global surge in the cases reported daily. As governments implement changes to curb the spread of the virus, businesses are impacted positively or negatively. There are threats as well as opportunities that have been presented by the pandemic to businesses in terms of their new service offering. One of the major threats is the disruption in the supply of goods and services due to the massive lockdown implemented in various parts of the globe. The opportunities presented by the pandemic include the adjustment in the production of goods and services to enable companies to respond to consumer behaviors. Companies have also engaged in the provision of donations aid companies in building a good reputation among their competitors, which is good for business. As companies adopt changes, big firms, including Amazon, assist small companies by providing reliable logistics, which is good for business. Online trading is another opportunity that has been exploited by service businesses as it is convenient since government regulatory is observed.
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