Businesses need to embrace change if they don’t want to be outpaced by firms which do

With Plan B now officially backed by the commons and daily headlines warning of further restrictions in the form of a potential ‘Plan C’, businesses are once again wrestling with Covid-19-related uncertainty that many hoped were behind them.

Thankfully, Welsh business leaders have shown great resilience and become very good at dealing with changing government guidelines, reactive customer behaviours and unexpected market pressures. Agility has been the key watchword.

Early in the pandemic, many pivoted to changing marketplace demands by adapting or even completely overhauling what came off their production line.

The Pontyclun-based Royal Mint was one example, switching from coins and precious metal investments to plastic visors for health workers. In a matter of days, the company had gone from not knowing anything about visors to being able to produce one every 10 seconds. By month six of the pandemic it had made approximately two million visors for the NHS.

Other businesses have shown their versatility by looking for new customers and markets for their products instead of changing them. This was the case at Tillery Valley Foods, a catering company based in Abertillery.

While typically focused on the healthcare sector, in 2020 Tillery Valley Foods saw potential in the transport industry as well and won a contract with Transport for London to supply 26 sites on the Underground network.

This appetite to grow and expand into new markets has not been diminished, as highlighted by our Business Outlook Tracker survey that we conducted earlier in the year. It found that almost two thirds (65%) of mid-sized firms in Wales are expecting to export the same or more to the Eurozone over 2021-22 compared to before the pandemic.

With discussions ongoing around new trade deals across the globe, better access to international markets is still possible. For example, over three quarters of the Welsh businesses we surveyed felt that a free trade agreement with India would be more likely to encourage them to explore opportunities in this market.

In contrast, some businesses have reacted by concentrating more on the domestic market, with almost half (41%) of the Welsh mid-market stating that Brexit had caused them to twist away from international operations and to grow their UK presence instead.

While it might appear contradictory that some are turning away from international markets and some are turning towards them, it shows that few businesses have been able to stand still and that the majority have had to pivot in one direction or another to remain viable.

Branching out into new products and new markets is just the tip of the iceberg when it comes to agility, as a flexible approach needs to be maintained throughout every aspect of the business. Rigid internal structures are unlikely to fare well when faced with difficult decisions and tough choices – both of which are likely to be with us for some time yet.

Embracing new digital technology has become an increasingly popular way to remain agile. This is something that the banking sector in particular has done well since the lockdowns began, by leveraging digital advances such as cloud platforms and low code technologies as well as engaging with new ecosystems and developing clever outsourcing arrangements.

Thanks to a combination of the pressures that businesses have been under and the innovative ways that they’ve responded to them, change has become the new normal.

This is going to serve them well in the New Year, as it’s apparent that the pandemic is still going to be with us for some time yet as are Brexit knock-on effects, confused supply chains, rising energy prices, labour shortages and inflationary pressures.

Added to all this is the fact that even without the unprecedented curveballs, businesses that expect to settle back into a traditional model may well find themselves outpaced by those that have successfully embedded flexibility, speed and constant innovation into their day-to-day processes.
Rhian Owen, head of Grant Thornton's Cardiff office