Changes and opportunities for industries

Edward Tse, Founder of the Gao Feng Advisory Company, observed that a safe and healthy living environment is now considered equally, if not more important than economic growth. Earlier detection and prevention will be crucial for a future public health and management system. The system in China has proven its capability during the outbreak, in which the private sector has made a significant contribution. It has demonstrated the necessity and potential of public-private partnership.

The outbreak has accelerated the application of new technologies. Social communication was greatly diversified, making room for efficient and online measures of interaction. This trying time is also shaping the entrepreneurship of the private sector. Many businesses were driven not only by profits but also a desire to provide a social good.

Such changes imply multiple opportunities for industries, described below:

1. New business models are emerging, especially in sectors such as health, logistics, automation, online office, entertainment, retail, and education;

2. New generation smart cities are key to the future public agenda. Besides certain urban functions, a new generation smart city will systematically enhance public management by integrating supply chains, traffic, emergency and disaster warning.

3. Big data will be more widely used for public wellbeing, especially for tracking, analysing, and supporting timely public decision-making.

4. Offline-driven businesses begin to shift online, especially in education, entertainment, and retail.

5. The value chain of healthcare will be extended to cover early detection and prevention. Future application scenarios will include more participants and promote a comprehensive ecosystem for public health agendas.

6. Social media is changing from being the channel between not only individuals and business, but also public and the government.

Strategies for business

Adversity is a state of mind. Tang Ning, stressed that the entrepreneurial spirit – which features the faith and capability to turn crisis into opportunities – is now vital to Chinese businesses. The business models are already shifting. Remote work and online business, which faced obstacles previously, are now a necessity. Business must embrace the following strategies in order to seek and seize opportunities:

1. Digitalization is the future. The outbreak is an opportunity to reshape and implement digital strategies. It in turn will create new opportunities. Capability building and new value creation are key for such transformations.

2. Risk management needs to be re-evaluated. More attention will be directed to insurance, multiple sources of income and customers, and integration of online and offline business. To many Chinese businesses, especially small and medium-sized enterprises (SMEs), separation of family and business, diversified asset allocation and insurance are fundamental to risk management.

3. SMEs need to take initiatives actively. Beside cost control, unique competitive edges have to be developed to the fullest. A great bounce back is expected across industries after the outbreak, and SMEs need to reflect on how to relate to and seize the next wave of growth.

Culled from: https://www.weforum.org/agenda/2020/03/coronavirus-china-opportunities-change/