Responding to a Fast-tracked Future
Former FTSE 250, Private Equity CEO and Chairman and Hammerforce director James Drummond shares his thoughts on why he’s optimistic about the future and how, taking advantage of the acceleration of trends and dynamics that existed before Covid-19, means businesses can start solving the seemingly impossible.
The future usually arrives gradually, giving us time to adapt and change at a speed that suits us as individuals, as organisations, as countries.
Covid-19 has been an unprecedented shock to the modern world, it’s wreaking havoc on global markets and the social and economic environments in which businesses operate.
As the economic pain sets in, businesses will either survive or not. Covid-19 has not only accelerated the normal cyclical effect that happens in every economy but is setting in motion a structural shift as existing trends are massively accelerated and behaviours forced to change. Consolidations and changes – both good and bad, will occur in every single sector.
However, what Covid-19 has demonstrated to us all, is the ability to take serious action at a speed and scale that was completely unthinkable a number of months ago.
The response to this pandemic from Governments around the world has been unprecedented and dramatic. If you had asked anyone at the beginning of the year if they thought it was a good idea for Governments and central banks to be taking the kind of actions they have to help companies and people cope with the impact of Covid 19, they’d have thought you were completely mad.
Irrespective of the consequences of their actions and whether you thought what they’ve done is right or wrong, what this has shown us is the false tension, or the disconnect, associated with accomplishing the seemingly impossible. In fact, what we now know is if you take very dramatic action, very quickly, in a way that was previously unthinkable, the seemingly impossible is actually achievable.
It’s shown us that governments and businesses globally, have far more freedom to act, and to act quickly, than we have ever allowed ourselves to imagine. With that comes new opportunities and growth for businesses who can survive in the short term.
Now the question has to be; how do we adapt to a future that is being fast-tracked and survive as trends and dynamics, that were in place before Covid-19, rapidly accelerate?
The London ‘Economist’ recently noted [April 11, 2020] the gloom of a recession within countries is not evenly spread, some sectors are doing worse than others and the fortunes of the most and least resilient are far apart.
But I’m feeling optimistic about the long-term future. Why? Because the human race is fantastically clever and resourceful. We’ve solved the seemingly impossible many times before, it’s about thinking big enough and knowing we are capable of achieving if we allow ourselves the freedom to act.
History teaches us a lot; we’ve survived recessions and we’ve survived global epidemics. There’s no doubt this global recession will hit hard, but it needs to be seen in the context of more powerful long-term trends, such as the shifting of business to the Cloud and the sustainability of our environment, both of which will lead to a resurgence in economic growth.
Businesses who currently find themselves looking through a ‘lens of gloom’ need to lift their sights towards revival. Which means they need to have a plan to survive in the short term, to build a bridge so they can participate in the longer-term growth and possibilities that lie ahead.
Survival now, means prioritising people and cash while being cognisant of the rapid acceleration of trends that have been driving change and the strategic shifts that will occur in a post Covid-19 environment.
As the London Economist went on to state, “Optimists — and business folk tend to look on the bright side — see this acceleration as offering new possibilities for reinvention, even resurrection. Pessimists see inefficiencies and insularity weighing on profitability for many years to come.”
Businesses now need to be reconciling how they move beyond the short-term to achieve what they might believe to be impossible – be the authors of their own fate and survive in an environment where suddenly everything that was familiar is now broken.
The basics of survivability in the short-term are not rocket science. The companies that have the best chance of survival will be looking after their people – employees, suppliers, customers; and they’ll be looking after their cash – making sure their balance sheets are strong and resilient as possible.
But what companies will also be doing, and this is where I want to use Hammerforce as an example, is positioning themselves to take advantage of the accelerated trends and dynamics.
Covid-19 is likely to turn out to be one of the greatest catalysts for business transformation; everything we’ve predicted about the future will now happen in a matter of months, rather than years. Businesses that have agile business models – those that can respond differently, find different ways of working, have a different mindset and adopt different technologies to solve challenges are going to be the winners out of this.
There’s no doubt that the sustainability of the environment we all live and work in is an increasingly powerful trend. This isn’t just in the minds of people, but also in the minds of regulators who set standards across different industries.
We’re constantly seeing new environmental standards and regulations being brought in which are increasingly changing the way well established industries work. Yet, even as forward-thinking leaders have pondered the effects this accelerated change will have on their organisations, actual transformation has been surprisingly slow.
That is, up until now. We can now see how fast Government’s and organisations can actually move, and on a scale we hadn’t imagined.
The acceleration of the trend around increased sustainability is highly relevant to Hammerforce and its’ partners who have the mindset and agility to address the trend that has been unfolding over the years.
Hammerforce’s designs are carbon-free in terms of their application and because the only power source used is air, the impact on the environment is extremely low which means the current standards across numerous sectors are being more than satisfied. In fact, the technology is setting higher standards; enabling a new level of environmental performance to be established across a diverse range of sectors.
This is clearly a good thing for the environment and for Hammerforce’s partners. Companies that adapt and use these designs and the technology to establish a higher set of standards in their own industries – a set of standards to which they’re uniquely advantaged to be able to deliver against, are now in a very powerful position within their sector and in their ability to deliver value to their own customers.
When you look back, some of the most successful innovations and successful companies have been those that have either done something no one has ever thought of or done things which people thought were impossible.
If you take a simple view of what Hammerforce manages to do, it takes well established technology – pneumatics – which people understand to have significant limitations in terms of its capability and potential. Hammerforce demonstrates that there’s not just potential but a performance from pneumatics that nobody thought was possible.
In terms of considering solving the impossible, I’m not sure whether people thought getting vastly higher levels of efficiency from a pneumatic system was impossible, but certainly no one had ever done it before.
While the technology can be scaled massively up or down and is very flexible in terms of the materials that can be used, what is consistent across all applications of the technology is the delivery of better performance, at lower cost and, in a very sustainable fashion. This is both in terms of the performance of the application itself and its environmental impact – its’ efficiency, lack of waste and ability to establish new standards, all of which ultimately delivers value to customers and a genuine and sustainable competitive advantage.
Hammerforce is absolutely focused on sustainability, the resilience of its customers and more broadly the environment in which they work in. So, in the longer term, the company is very well positioned to take advantage of the opportunities this accelerated trend presents and help its partners create real value.
This pandemic and the response to this pandemic, should really be changing people’s minds about what is, and what isn’t possible, and the degrees of freedom we give ourselves to deal with the opportunities and the challenges we face.
Many people have said the world will be forever different. Sure, there will be long-lasting changes, but I think the most powerful of these changes will come from the realisation that we’re actually only constrained by the constraints we impose upon ourselves.
As countries, businesses and individuals we choose what those constraints are. What we have demonstrated to ourselves over the past few months is that we can do extraordinary, unprecedented, unthought of and apparently impossible things and we can do them at pace.
The seemingly impossible is no longer so.