The Future: Part 1

Back at the beginning of April, I wrote a piece for one of our clients in the hospitality industry, outlining what we believed was the probable commercial and consumer path we might be travelling over the next few months.

Almost two months later, and my general thinking and the logic behind it, still seems reasonably sound. If I’m brutally honest I find that quite worrying.

So first things first, here is 2020’s general synopsis.

THE END OF BUSINESS AS USUAL

IS THIS AS GOOD AS IT GETS?

TO DO NOW:

Firstly, and urgently, initiate a two-part, in-depth Market Research programme.
Businesses really need to gain some understanding of the impact of the pandemic and government actions on their target markets. In the case of consumer markets, you need to know the new likely social habits across a range of demographics. Will they come back? What will keep them away? How will they get to you? What are their expectations?

You should discuss internally and act upon them, at a trial level. The second part of the survey should be undertaken three months after the lockdown has been lifted to confirm the findings of the first survey.

In financial terms, you need to control and resolve all outgoings. It may seem obvious, but we have already seen a number of smaller businesses trapped in the headline’s glare. In HR terms, staff too are frightened and in some cases desolated, even inconsolable. Engage and provide moral and social support. Leadership has to be seen.

Similarly, you must engage with the existing Client base. Be seen to be leading the optimism; remind them of your relationship and if possible the historical interactions. Keep social media going by providing something (news quiz jokes pix customer pix, best of competitions).

In distribution and supplier terms, are you maintaining the status quo, or are you going to be changing your requirements or cost-base profiles? Is the supply chain fit-for-purpose? Those decisions can’t be made when you’re trying to get going again.

Make sure that your Technology and Data are all fully secured and more importantly, research the solutions that might have been thrown up by your stakeholder research.

Are you ready for the further complications that the future environmental changes will bring?

WHAT DO WE KNOW?

• 70% of all positive tests are Asymptomatic.
• COVID-19 immunity may be either minimal, short-term or in some medical profiles, nil.
• There will be an age-related reticence to go out among the 50+ age group. That also means that a sense of need or support for social distancing will remain high
• There will be no early freedom of movement until December 2020 – possibly.
• We haven’t got the “Science” yet to either fully understand, control or manage this virus
• The UK does not have a trading deal with the EU
  • Option 1. Either party walks away and reverts to WTO rules
  • Option 2. Trade Talks are delayed – which might force our involvement in the proposed EU Coronabond
  • Option 3. Whatever outcome there will be issues with supplies.
  • Consider having no reliance on imported goods by initiating a change to UK suppliers. Start the process now.
• Charities need charity. The entire Charity sector is overwhelmed by the loss of income and volunteers. Many charitable operations rely entirely on volunteers whose likely age is over 55 and many are in the vulnerable group.
• For the rest of 2020 what was perceived as The Leisure Pound will see 25-50-% given to charities. In 2021, there won’t be a Leisure Pound, except at the top end of the market.

WHAT MIGHT WE GUESS?

• Economic
  • We are likely to have a deep Recession in 2020 and a possible Global Depression in 2021.
  • 2020 believes that it is possible that this will result in a new era of socially acceptable “Sustainable Capitalism”.
  • The EU issue, the recession, the rediscovery of a sense of self-sufficiency and self-confidence, may nudge developed countries such as The UK, towards a “Self-Sufficient” economic model and away from Globalisation.
  • Buy British – Stay Local – Live Local – Think Local
    • The Shires have taken to using local farm shops and delis and have rediscovered – albeit at a price – that Local is good and can in some cases be considered less of a “treat” and more of a regular upgrade.
    • Restaurants have started issuing “bonds” that “support your local…”
  • Self-Employment will effectively be ended in the UK
  • Indirect Taxation will rise, including the introduction of Carbon Taxation on Fuel, possibly meat and heating oil.
  • The use of cash will cease – this will force the black economy into Crypto-Currencies.
  • There will be a move from Cities towards Towns, for those working from home.
    • This will impact on the 3-bed housing market within 90 minutes of London, and 60 minutes of Birmingham and Manchester with prices potentially rising 10%.
  • The commercial property market is going to suffer
    • As a result of the lockdown, some large City-based companies have discovered that their operations have not collapsed as a result of people working from home. One global company we know of, is looking to place 30% of its staff at home, and early figures suggest that both Employer and Employee benefits might include:
      • Increased productivity by as much as 25%
      • Lower per employee costs
      • Increased employee satisfaction with the realisation that there is no commuting – and no associated commuting costs – implying a substantial increase in take-home pay.
      • This, in turn, means a lower, or static, wage bill for the company and a possible improvement in staff retention.
      • This also suggests that many commuter-belt locations will see increased footfall during the day and a potential increase in evening social activities.
    • It would be no surprise to see a fast increase in personal and corporate Taxation
      • Companies that show a profit, and have taken furlough money or loans will face some form of penalty.

• Social

• • HR issues are going to be increased because loneliness, depression, addiction, OCD and a range of other mental health issues are mainly going to remain untreated during the lock-down.
    • Post-Lock-down, it is unlikely that there will be either budget or time to support sufferers. This will have wide family structural impacts.
  • Care for the elderly is going to require a major voluntary effort, and home-care grants will have to increase.
    • There is some confusion at the responsibility positioning of private nursing homes, with regard to NHS budgetary support and responsibilities.
    • Countries like the USA, Brazil and much of Africa, have woefully inadequate and underfunded healthcare systems. In 2017, for example, almost 60% of Americans did not have sufficient resources to pay for a $500 medical emergency. That will, in turn, become reflected in November (if the US elections go ahead) amidst a great deal of street violence.
    • The increased surveillance through CCTV, mobile phone and face recognition. in the name of COVID-19 spread management will become widely accepted, (Singapore and Israel have already recently introduced such “public” measures). It will never be relaxed.
    • General acceptance might even lead to a biotech ID card which eventually covers work, tax, transport and all government payment modules.
  • The downside of the coming technology boom is that the specialists will become the new priests of the Church of IT, while “Connectivity” will be the new mantra and drug of choice.
    • That, in turn, will develop the question of Digital Ethics, which impinges on a variety of issues ranging from surveillance to medical data-sharing, from tracking household waste management, to the development of robotics.
    • It will also create a two-tier system of social-worth
  • Remote education will flourish. Those schools and universities that adapt quickly will benefit from the ongoing need for social distancing.

• Political

• • The smoking gun of China’s role in the creation and accidental distribution of COVID-19 is already being investigated globally, and the outcomes are unlikely to mitigate diplomatic frostiness. Several countries have already initiated legal proceedings, the Chinese are delivering an outstanding PR campaign, not only refuting the suggestion but blaming it on either the US or the UK.
  • In the EU, Macron may yet manage to create his United States of Europe, off the back of his Coronabond with a weakened German leadership possibly unable to veto the far-reaching proposals. In a full-blown depression scenario, German history might focus a push toward the USE rather than staring at the Macron Line. However, the legal shenanigans between the ECB, the Bundesbank and ECJ and the various power plays underway, threatens not only EU unity, but might easily impact on the EU’s relationship with the UK.
  • The natural self-righteousness of “Populism” will inevitably clash head-on with other ideological stances as everyone settles down to play the COVID Blame Game. Public perceptions of Pandemic preparedness will quite possibly end the careers of Hancock and Johnson and see the Labour Party under Keir Starmer in poll position sooner than expected. The worst sort of a typical Socialist Spend-Spend-Spend budget, would (currently) cost very little and they are the natural party of choice to do business with Europe and China. They are most representative of the likely leading socio-economic demographic of next year.

• Environmental

• • CO2 Emissions have massively decreased. However, a number of environmental groups have already made strident noises about how we must change Now.
    • This will lead to some major disruptions in the coming months.
    • The extremism of some of the lifestyle and environmental action groups will receive very short shrift in a world in recovery, where Joe Public feels he has already paid a big enough price in terms of helping everyone else to get by.
  • The concept of cheap flights is now consigned to history. Landing charges, airport taxes will all be hugely increased, and travel taxation will all mitigate against any recovery in oil costs.
  • The Webcam – and a dozen near-instant supporting technologies, has ended the need for 40% of all travel.

• Scientific & Technological

• • There is global scientific hyper-collaboration to discover a vaccine – but at what cost in terms of who owns immunisation?
  • AI is quickly developing and growing and is not only utilised within the COVID-19 solution search but is also being used to track and trace individual viral contact.
  • Genome editing is also seen as potentially providing the alternative immunisation playing fields. Genome work has relevance for the possible affinity C19 has for BAME group’s DNA
  • The Internet of Things will, according to consulting firm McKinsey, generate 43bn connected devices by 2023, almost three times the number of devices in 2018.
  • The interconnection between IoT and 5G will also enable remote diagnosis, new businesses involving the mix of VR and holograms will boom.
  • All these technologies increase the growth of “home-working” – although there will be real anger at the lack of connectivity in remote rural areas. This will exacerbate the Them and Us divide that that national Government’s direction on rural housing, schooling, public transport and ultimately funding had been taking pre-C19
  • Greater Interconnectivity demand will, in turn, lead to rapid development in IT infrastructure
    • The growth of Zoom will also lead to a growth in digital conferencing
  • Everyone, everywhere will in 2022 do EVERYTHING ONLINE

• In General

• • The Government is already in practice the “Lender of Last Resort but is likely to become the “Supplier of Last Resort” across the entire infrastructure, from transport (air and rail) to energy (Electricity, Gas, Fuel).
  • Mass unemployment will fuel demands for UBI – a Universal Basic Income. This might well impact on profit-focused incentive programmes and there are direct parallels to the introduction of the NHS, after WWII.
  • There will be a national, possibly global, debate on the comparative rights of the elderly to the young – especially in light of the “pro-euthanasia” thinking in recent weeks.
  • Most importantly of all, the stresses on the entire social, economic, political, environmental and legal global infrastructures as we knew and understood them in September 2019, (I choose the date advisedly), have created the best possible breeding ground for a serious increase in global disorders and conflicts.

IN SUMMARY

Before we start to think about recovery, we have to be willing to accept – without being emotional or pessimistic – that the worst has possibly not yet happened. Not just in global death rates, but with the near-total collapse of economies and the ultimate impact on nations, mass-movements and society.

The continuing lockdown will, whenever it ends, almost certainly lead to a great deal of disenchantment and frustration, because it will quickly become apparent to the public that the Virus is here to stay. Coupled with, at best, a significant recession, and it seems likely that there will be in the UK major social and financial unrest in the next six months.

Not only must we remain positive and lead positively, but we must also immediately rethink our business proposals. Those revisions MUST be based on solid research.

Each organisation’s position In October 2019, has no similarity to the likely one in October 2020 – and that means we must start to plan now. We need to consider what those changes might be and what we will then need to do to actuate those changes. Effectively you will be launching a new firm – not relaunching the old company. You, therefore, need to understand the environment in which you will be launching this new business and the benefits and risks that are unseen within its topography.

Do not look back at LfL or past trends. Start at Day 1 Year 1. In the next five years, the corporate focus will only be on short-term trends. Look at your industry’s macro direction of travel, not the micro overview of each issue.

That is not a Dystopian future, but rather a different one.

Work Together