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UPDATE: Return to work updates now included – click through the themes below to see what steps your company should be considering. 

As the COVID-19 pandemic moves to a new phase, customer behaviours have changed in ways that we have never seen before. For businesses, this has been first and foremost a demand crisis, which determines large elements of the commercial challenge. Market access and demand for products and services has changed, fundamentally driving significant changes in customer behaviours needs and expectations. There have been material shifts in buying patterns and channel usage, often daily, and in several different ways at the same time. We now expect further changes.

Commercial resilience remains of critical importance. Capturing, understanding and meeting what will inevitably be rapidly changing customer demands and behaviours at a time when patterns are highly uncertain will be key for both a return to work and the new reality post COVID-19. It will likely require many businesses to review and potentially adjust purpose and strategy to thrive.

To navigate uncertainty, businesses need to prioritise creating human connections across an unexpected, unfamiliar landscape. To make effective decisions, actionable customer insights are more important than ever, so leaders can rapidly pivot their support to meet often rapidly changing needs; especially amongst the most vulnerable. Best practice in customer and colleague experience has never been more important. Those that get this right will both weather the storm and lay the foundations for the future.

KPMG’s Guide to Maintaining Enterprise Resilience has been updated to consider how businesses can prepare for their Return to Work. Below we outline some of the key steps that we believe organisations should take to maintain their commercial resilience.

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Crisis management Return to work Forward planning Who to contact?

Challenges

  • The forced closure of retail outlets and physical self-isolation has dramatically altered consumer demand and disrupted supply chains have impacted the flow of product and services
  • New regulations and policies may disrupt market access, demand and distribution
  • Demand is changing materially, with many lines seeing dramatic falls, while ‘staples’ and key services are experiencing rapid growth
  • Demand for substitutes and new products and services aimed at helping customers will grow. We could see businesses being forced or expected to pivot their focus to specific product lines

Industry insights

  • Product lines are being rationalised and simplified to best meet changing demand, most notably within food retail
  • In many product and service categories, there has been an accelerated shift to online ordering and home delivery, which is likely to remain a fixture even after the current health crisis
  • Some financial service products, notably in credit, lending and insurance, are expanding as customer finances begin to feel the strain and government intervenes to support individuals and the economy
  • Capabilities are being shifted to boost capacity in areas of high demand with heavy recruitment in fulfilment operations across online, retail and food
  • Cooperation and collaboration between businesses are on the rise, with the aim of sharing capabilities, supply chains and distribution networks

Suggested Actions

  • Assess and monitor daily how current and anticipated travel restrictions, including border closures, new regulations and policies will impact market access, customer demand, supply chains and distribution. Anticipate and plan for further restrictions in collaboration with key suppliers
  • Identify which products and services are experiencing increasing or falling demand. Consider establishing additional management information flows and tracking closely emerging patterns to filter through the business
  • Analyse and monitor changes in market, product, service and customer segments as well as demand and behaviours
  • Review commercial arrangements – pricing, sales and service requirements – considering specific customer segments evolving situations, needs and expectations
  • Decide which activities to stop, start and continue – and assess how resources and capabilities can be reallocated. Establish information, communication and decision lines through the business to ensure actions are coordinated and agile
  • Identify and assess responses to any increased costs and risks
  • Pivot existing capabilities to address overstock challenges
  • Assess how broader industry or adjacent sector partnerships could match surplus supply with demand

How is KPMG helping?

  • Rapid assessment and diagnostics to identify critical impact points across the business
  • Mapping and quantifying key implications and interdependencies
  • Planning and assessing capabilities, capacities and the scope to reallocate them
  • Review of commercial arrangements covering pricing, sales and service requirements taking into consideration specific customer segments, evolving situations, needs and expectations
  • Legal review of contractual arrangements
  • Advising on data protection and consumer law obligations for businesses which have moved online
  • Establishing sector specific C-suite (virtual) roundtables to share key issues, learnings and encourage collaboration
  • Link up and share learnings from other KPMG member firms who are in a more advanced phase of the current situation

Challenges

  • A return to work is anticipated to be gradual and staggered across regions/sectors with some continuing restrictions on opening and social distancing further impacting customer demand and behaviours
  • The workplace environment will not immediately return to normal and adjustments to incorporate safety and social distancing will continue to impact product and service supply
  • Regulatory and policy changes are anticipated to persist, and may further change impacting market access, demand and distribution
  • A gradual return to work will start to increase demand for ‘non-staples’ and broader services, but this may not be consistent across markets, regions and product areas, thereby presenting supply challenges
  • Although some changes to customer behaviour and sentiment are anticipated to persist, demand for substitute products and services may start to subside

Industry insights

  • Planning efforts are shifting to ensure that production and supply can restart in product and service lines where demand is anticipated to recover in the transitory return to work phase of the crisis
  • Product and service line rationalisation and simplification is being built into plans to reflect changing behaviours during the initial lockdown
  • Capabilities are being readjusted to return to areas where demand is anticipated to increase
  • Online channels are further being bolstered in anticipation of a more persistent shift to endure the crisis
  • There will be an increase in financial products and services to support the return to work and remobilisation of businesses and supply chains
  • Partnerships and cooperation arrangements established during the crisis are being reassessed and adjusted to reflect an anticipated return to work

Suggested Actions

  • Ensure that clear channels, communication, governance and control processes remain in place to monitor and assess evolving changes in government restrictions, regulations and policies
  • Based on the experience during the initial stages of the crisis and lockdown, consider and plan for an increase in demand across the product and service suite and identify the implications for a return to work
  • Track changes in demand and compare against pre-crisis volumes and channels to provide insight on the persistency of changes in customer behaviour during the crisis
  • Review commercial arrangements – marketing, sales and servicing, and pricing
  • Establish teams to monitor demand, assess the impacts on business and to respond with agility
  • Review any partnerships established during the crisis to understand demand changes for respective products and services and pivot accordingly

How is KPMG helping?

  • Designing and implementing product and service dashboards to track changes in demand and developing scenarios for planning purposes
  • Monitoring market, sector and competitor developments to provide an insight into key decisions on the shape and pace of returns in demand and changes to proposition and product landscapes
  • Performing portfolio analysis to identify and prioritise plans to remobilise and/or rationalise product and service suites
  • Establishing sector specific C-suite (virtual) roundtables to share insights, perspectives and learnings and encourage collaboration
  • Providing insight and learnings from KPMG member firms in other countries that are in an advanced phase of returning to work
  • Providing legal advice on regulatory changes

Challenges

  • The ‘New Reality’ post crisis remains highly uncertain, and perspectives on the shape, timing and persistency of changes in demand and supply across markets and sectors remain divergent
  • Restrictions, regulations and policies established during the crisis are anticipated to persist in some form for the medium term and continue to impact demand and supply
  • The persistency of the rapidly changing customer behaviours and demand for products and services remain uncertain over the medium/long term
  • Changes across the spectrum of political, economic, social, technical, regulatory and operational landscapes on the back of the unprecedented crisis could drive long-term changes in commercial models – products, services, marketing, sales, service delivery and pricing

Industry insights

  • Many businesses are beginning to shift the focus to forward planning
  • On the back of insights gathered during the crisis; on changing customer behaviours and demand patterns, scenarios are being developed to identify potential outcomes and understand the implications for commercial models
  • Some businesses are already looking to rationalise and simplify product and service suites to drive greater efficiency and effectiveness and support future growth
  • Greater collaboration is evident within and across specific sectors and internationally to share insights and learnings to help inform and build scenarios
  • An increasing number of businesses are commencing more radical reviews, revisiting their purpose and commercial models to evaluate potential implications for product and service lines, particularly where recovery is expected to be delayed

Suggested Actions

  • Gather, harvest and gain insight into internal and external data to inform potential future scenarios
  • Conduct PRESTO analysis to identify spectrum of potential outcomes
  • Perform customer research to understand and assess persistency of customer demand and behavioural changes
  • Develop a focused number of viable scenarios and assess the relative importance and implications on product and service demand
  • Revisit the product and service portfolio, sales and service requirements; assess the implications on the commercial model

How is KPMG helping?

  • Scenario planning underpinned by robust PRESTO analysis
  • Stress testing existing commercial models against a variety of forward- looking scenarios – war gaming and simulations
  • Analysing product and service portfolios
  • Purpose and vision review and development
  • Identifying and assessing potential growth platforms
  • Rapid and agile commercial model design/prototyping

Ian Smith

Ian Smith
Partner, Commercial Resilience Lead
+44 7887 632220
ian.smith@kpmg.co.uk

Julian Short

Julian Short
Partner, Corporate Strategy
+44 207 3112028
julian.short@kpmg.co.uk

Jo Stringer

Jo Stringer
Partner, Corporate Strategy
+44 203 3064698
joanna.stringer@kpmg.co.uk

Crisis management Return to work Forward planning Who to contact?

Challenges

  • Customer emotions, needs and behaviours are driving rapid changes in demand, buying patterns and channel use
  • Post COVID-19, customers may continue to embrace the online channels used during the crisis for key products and services, particularly where they have had a good experience. However, it’s not yet clear if all behavioural changes will ‘stick’
  • The New Customer behaviour is moving rapidly but they are mostly experiencing “Recovery” stage service levels from market leaders
  • Innovative pipelines will need to be accelerated to meet New Customer needs. Actionable insights are critical to navigate this crisis of consumption
  • While demand clearly points to customers focused on accessing basic products and services, (food, health, finance, utilities, streaming services etc.), they are finding it hard to deal with these businesses
  • While the grocery, healthcare and travel sectors are beginning to face challenges, other sectors have slightly more time to deviseplans to retain their customer base before it disperses

Industry insights

  • The ‘New Customer’ is re-writing previously established rules of how businesses operate
  • 89% of customers have already changed the way they interact with at least one sector, 48% would rate the resulting experience as better in at least one sector, 47% of those who had a better experience will keep dealing a business the same way, post-crisis
  • However, problem resolution and time management issues are beginning to surface which if left unresolved risk losing customers to your competition
  • Businesses are rapidly changing operating procedures to reflect the New Customer behaviours and reallocating resource and capabilities to tailor customer communications and sales and service models to reflect these specific new segment situations and needs
  • The New Customer is becoming more familiar with self-serve, drawing on both established tools and the knowledge of others; firms are rapidly redesigning journeys to incorporate new digital capabilities, online channels and fulfilment capabilities to respond to these trends
  • The New Customer is becoming more altruistic, prioritising community and integrity; they are less focused on deals and profits
  • A “back to basics” approach on experience, prioritising integrity, empathy, time and effort and issue resolution is needed
  • Firms are equipping and enabling employees to ensure they can navigate the ‘new normal’ and meet customer demands

Suggested Actions

  • Identify and segment your New Customers in response to immediate changes in demand and buying behaviours
  • Identify the self-serve and digital channels that are creating positive experiences and embed these for the long-term to meet New Customer preferences and drive potential cost savings
  • Reallocate resources and capabilities towards tailored customer communications and sales and service models
  • Prioritise vulnerable customers and critical workers for additional support
  • Use the Six Pillars of Experience as a checklist to ensure that the right bases are being covered and appropriate behaviours are in place
  • Take an empathetic view towards your New Customer and their immediate needs
  • Include employees and front-line staff in planning so they can be rapidly equipped to provide the latest information to customers and respond flexibly as required
  • Ensure employee experience is treated with the same priority as the customer experience and manage overlaps between the two

How is KPMG helping?

  • Weekly social and behavioural insights, capturing emerging customer issues and needs
  • Setting up consumer behaviour monitors across multiple markets to understand changing consumption patterns
  • COVID-19 specific checklists for customer experience, using KPMG Nunwood’s Six Pillars best practices
  • Rapid mobilisation of new customer operations, channels and technologies to support specific clients

Challenges

  • Many changes in customer behaviours seen during the crisis are anticipated to persist and may change further. This will require customer journeys to be revised and supported with enterprise wide changes
  • Some restrictions will continue to impact customer demand and behaviours, product and supply
  • Social distancing and health and safety arrangements are likely to be required for customers as well as employees
  • It will be critical to manage customer expectations when they are impacted by market access, demand and distribution availability
  • Locking down new online customer behaviours and channel preferences and ensuring that the experiences meet customer expectations

Industry insights

  • Firms will need to redesign customer journeys by incorporating new online channels and fulfilment capabilities to reflect the shift in New Customer behaviour and lock-down long-term value
  • Customer experiences are being redesigned to ensure social distancing and health and safety in physical outlets
  • Product and service line rationalisation and simplification needs to be closely monitored to ensure that businesses are not left out of sync with customer demand
  • Communication has been a key factor is engaging positively with customers during lock-down; this will need to be continued to manage New Customer expectations effectively during the ongoing uncertainty
  • Firms will need to continue to equip and enable employees to ensure that they are able to navigate the ‘return’ to support customers

Suggested Actions

  • Audit customer journeys for crisis resilience – identify and resolve opportunities to automate and reduce costs
  • Optimise your channels to reduce frustration and the time and effort associated with accessing/using them
  • Mine behavioural, social and sentiment insights and establish leadership level reporting to fine-tune action
  • Consider reprioritising resource deployment to address immediate customer needs
  • Leverage emerging New Customer contact mechanisms such as neighbourhood WhatsApp groups and local Facebook pages
  • Include employees and front-line staff in the planning phase to ensure that they provide latest information to customers and can be flexible in their approach

How is KPMG helping?

  • Enabling businesses to make immediate changes to reflect new channel behaviours and needs
  • Working with businesses to identify quick wins, taking account of changes in customer behaviours and expectations
  • Initiating agile innovation teams to respond creatively to medium-term changes in customer needs and finding new ways of solving emerging customer problems
  • Designing at a distance is an accelerated way to support businesses who currently wish to look at their future customer and employee future experiences; Using digital collaboration tools, we can deliver remote assistance to design, define, test and deliver changes to journeys
  • Monitoring demand and New Customer trends, using insights to inform and guide businesses on these different scenarios

Challenges

  • Changes in customer spending, values, behaviours are without historic precedent and the New Customer will define the next wave of digital transformation
  • Purpose, brand and strategies will need to adapt and pivot to reflect changed spending values, behaviours and needs to renew growth, then re-imagine the enterprise to thrive in the new reality
  • Elements of brand and customer strategy will be challenged and need to be revised to ensure long-term growth in a new environment
  • Businesses will need to create a leaner, lower cost enterprise whilst gaining line of sight on growth

Industry insights

  • Some businesses have realised that things will be different in a post-COVID world and have started to assess the implications of changes in customer behaviour on future customer journeys and experience
  • Many businesses are accelerating transformation programmes and embracing new ways of working to meet evolving New Customer behaviours and preferences
  • Other businesses are working on an assumption that pre-crisis normality will return, although over a prolonged timeframe with the shift to increased use of online and other digital channels

Suggested Actions

  • Review channel strategies and develop plans and solutions to enable the business to adjust to new processes, IT capabilities and supporting resources, and governance and control processes across the business
  • Revaluate infrastructure investments and segment your customers in preparation for the New Reality will be critical to plans
  • Develop new digital marketing and communications platforms to engage your New Customer directly and respond to their needs through personalised interactions at scale
  • Assess the potential impact of short-term disruption on longer-term patterns of customer demand and behaviour
  • Re-engineer customer journeys and processes to address altered needs and behaviours
  • Establish robust MI and monitoring to track further changes in customer demand and behaviours and ensure to ensure visibility and control

How is KPMG helping?

  • Developing a joined-up COVID-19 customer plan including:
    • Customer segmentation analysis, journey design and planning
    • Enterprise readiness assessment
    • Decision and implementation support
  • Monitoring customer trends and providing insights to inform and guide businesses on different scenarios

Adrian Clamp

Adrian Clamp
Partner, FS Customer Advisory
+44 7920 253676
adrian.clamp@kpmg.co.uk

Tim Knight

Tim Knight
Partner, Corporate, Customer Advisory
+44 7812 022538
tim.knight@kpmg-nunwood.co.uk

Linda Ellett

Linda Ellett
Partner, Head of Consumer Markets
+44 7798 572368
linda.ellett@kpmg.co.uk

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