The travel, hospitality, and tourism industries have been hard hit by the coronavirus pandemic, and may continue to undergo severe disruptions following the economic crisis. How can technology help rebuild these industries?
Granted, these may be the hardest hit industries in terms of the economic impact of the pandemic, but they are certainly not alone. From manufacturing to retail, the pandemic has spurred the widespread disruption of traditional industries, speeding up digitization, remote work adoption, and the willingness to implement innovative technologies.
In a recent panel discussion hosted by Start-Up Nation Central during the recent New Digital Age Conference, OurCrowd partner Laly David spoke with Thomas Reichert, Chairman of Global Practices and the Global Digital Leader at the Boston Consulting Group (BCG), and Ash Jokhoo, Chief Information and Data Officer at Virgin Atlantic, to get a better idea of what kinds of disruptions we are likely to see in traditional industries and when these industries are likely to bounce back.
Panel participants also shed light on how the business environment is likely to change and adapt by not only implementing breakthrough safety and security standards, but also by engaging in more partnerships and ventures to adopt and realize startup companies’ solutions.
“14% of companies will actually come out stronger”
One of the biggest concerns following the global pandemic is that companies may be too slow to recover, creating an economic downturn fueled by fewer jobs and a more concentrated market (in certain industries). However, as Reichert pointed out, “we know that in crisis situations like this one, about 14% of companies actually come out stronger; stronger in terms of their growth, stronger profitability, and the question is really, how do companies make decisions to get to that point?”
Currently, many companies are looking for innovative technological solutions that will help them not only emerge from the crisis, but reinvent themselves in order to anticipate the market when the immediate effects of the crisis subside, which panel participants agreed is likely to take 2-5 years.
“Approximately 80% of our clients say they are going to make major investments in their technological base,” Reichert said. Indeed, investment in Israeli startups is in full force. According to David, “nearly $2.5 billion were invested in Israeli startups in the second quarter of this year, a 10% increase in comparison to the second quarter of 2019.”
Reichert said his clients are interested in developing quantum computing capabilities (for data analysis and storage), artificial intelligence, Internet of Things and knowledge management technologies. He emphasized that it will not just be one technology that helps companies reinvent themselves, but rather a combination of key technologies that will help industries move forward.
Bionic companies will emerge as industry leaders
Reichert and Jokhoo discussed the concept of a “bionic company”, or “a company that brings the digital realm and people together in a new way,” according to Reichert. In other words, the successful companies of the future will blend human and technological capabilities.
These bionic companies not only change the way an entire industry interacts with technology, such as the adoption of health and safety technologies for passengers in the aviation industry, as Jokhoo pointed out, but “they have to have a very clear purpose, a very clear strategy and a degree of flexibility, bringing people and technology to work together in a different way,” Reichert said. Such companies have the potential to emerge as industry leaders in the future, according to Reichert.
Innovation paired with a supportive business environment
Jokhoo illustrated his point by describing some of the processes that Virgin Atlantic is currently implementing or considering implementing in order to streamline the future of air travel. “We can act to provide seamless technologies for tracking and tracing COVID-19 cases and informing individuals that they should be in quarantine, as well as provide information that customers need in order to feel safe and secure,” he said. “This information should be presented in a manner that is simple and that extends across multiple governments, airports and companies.”
Both Reichert and Jokhoo share the belief that the implementation of innovative technologies in traditional industries must be paired with a supportive business environment and open-minded company leadership that is not afraid of getting things done. According to Reichert, “you can’t just build great new technology, you can’t just change the people side, you have to make sure that the business system comes together to support industry leaders.”
This creates great opportunities for startups to work together with corporations across traditional industries to promote their technological agenda moving forward, and for the betterment of all parties involved – startups, corporations, and customers. “In a way, this is an opportunity for startups to plug their individual elements into the common framework that will move the agenda forward,” Reichert said. “I think that this is going to be the journey for many companies and industries moving forward.”