Manage the crisis: one in three SMBs launched new products during the pandemic
When the pandemic had just started in March 2020, developing new products was a way to respond to the uniquely challenging situation for 29% of small companies, according to a recent Kaspersky study.
The lockdowns shook the financial wellbeing of the majority of SMBs (66%), and they had to take many cost-saving measures. In light of this, launching new offerings or business opportunities, as well as other measures taken, was an effort to survive.
The ability to adequately respond to a crisis can enable a business to make the most of it. According to Steven Callander, political economy professor at Stanford Graduate School of Business, “the objective is to handle a crisis as a management problem” and “to thrive in the spotlight”. In light of the pandemic, the decisions were especially complex. Organizations had to consider external factors – a lockdown, new sanitary requirements, a radically changed lifestyle – and their business capabilities.
In addition to the launch of new products and services (29%), as an active response, every fifth organization entered new business sectors (21%). For companies in events, entertainment, art and culture, or even healthcare sectors, that might mean launching digital alternative of their physical offerings; for shops or restaurants – enabling online sales and building delivery process; for manufacturers – producing masks, sanitizers and other medical accessories or focus on goods for home comfort.
Among other anti-crisis measures, predictably the most common, was allowing all or most employees to work remotely (46%). But the majority of decisions still aimed to optimize expenses: organizations introduced budget cuts (38%), reduced pay or working hours (35%), diverted budgets or stopped investment plans (30%). One in ten companies had to take critical measures such as laying off employees (12%), or stop paying bills (11%).
“Although some decisions were hard, they were necessary. Now, it is good to know that the overall feeling about the results of the pandemic is somewhat positive across small companies: two-thirds (63%) agree that their business responded well to the global challenge. The lessons learned should now help them to better prepare for future challenges, improve the current investment plan and processes, try new things boldly, and become more digital. I also believe that the products and services launched in response, will stay relevant because anti-COVID-19 restrictions are still in place and people continue to follow digital habits picked up during the pandemic” – comments Andrey Dankevich, Senior Product Marketing Manager at Kaspersky.
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To discover more findings from the Kaspersky report: “How small businesses got through 2020-2021: Budget cuts, product launches, and new investment priorities”, please read it here.