Top Ways COVID-19 Will Affect Industries: Part 1

May 06, 2020 by Stefanini

Learn how industries like hospitality and tourism, manufacturing, tech, and health care are handling challenges imposed by COVID-19.

COVID-19 is reshaping our present reality in ways we never could have foreseen. 80% of hotel rooms across the U.S. stand empty, home internet networks are facing increasing dependency and children remain home rather than in school. Truly, industries have had to reshape the way they do business in order to survive. But what changes will stick around while others fade away? The following industries are likely to experience the most change

Hospitality and Tourism

No one has taken a bigger hit than the hospitality and tourism industry. As organizations like airline companies report billions of dollars in losses, industry leaders need to prepare for what’s next. According to MarketScale, experts are predicting the following trends:

Photo by Avel Chuklanov on Unsplash

Photo by Avel Chuklanov

1.       Guest safety is the next big competitive advantage

For the next few months – even years – the new normal in the hospitality industry will be finding ways to raise occupancy rates to their former numbers. One of the ways to do this is to comply with the new safety standards and laws that are bound to pass. Show guests you have top-level safety measures in place!

2.       Safety will be a top driver of technological innovation and guest satisfaction

Hello IoT and sensors; meet the hospitality industry. These devices will reassure guests by monitoring cleanliness and distancing, displaying hotels’ commitment to safety in a tangible way.

3.       Flexibility and transparency will entice people to travel once again

A long time will pass between lockdown and full recovery. People will still want to travel, but will be hesitant to do so due to financial uncertainty. To attract potential passengers’ attention, companies need to be completely clear about policies regarding booking changes and cancellation, as well as loosen penalties.

4.       Properties must create both spaces where people can gather and spaces where people can distance

Even after the country reopens, people will still need to maintain a safe distance from each other. Hotels need to give guests the freedom to choose ow they spend their time. MarketScale recommends restricting some common areas with capacity maximums while leaving others open to host meetings, events, and more.

5.       Innovate

By investing in innovation—such as repositioning internal teams and processes or finding technology that can power comeback strategies—companies will be more prepared to handle the industry’s evolution, no matter how much it shifts.

Manufacturing

The manufacturing sector is already experiencing several short-term effects due to the fact that for the first time in modern manufacturing history, demand, supply, and workforce availability are affected globally at the same time. However, according to IndustryWeek, the industry should also be aware of trends that COVID-19 is accelerating the adoption of:

·         Revival of (automated) domestic manufacturing

Machines account for 85% of GDP in developed nations, and we may soon see a surge of incentive plans to bring back manufacturing segments that are considered critical for national resilience and sustainability. Governments are almost certain to use domestic manufacturing as part of their plan to build up strategic resilience in the aftermath of the current crisis. A key component to reviving domestic manufacturing will be automation because advances in automation and robotics have drastically increased productivity across many manufacturing processes, which can be easily reshored and deployed domestically. Therefore, automated manufacturing will create new jobs and opportunities for digitally-savvy workers.

·         Decoupling of supply chains

In the short-term, manufacturers are looking for ways to introduce flexibility and ensure continuity. Companies that invest in making their supply chains dramatically more resilient, predictable and transparent by using a wider base of global suppliers will gain a significant advantage. Suppliers, on the other hand, will seek to establish a more diversified client base and more localized customers across multiple geographies. Greater visibility and coordination across the supply chain will enable better collaboration with a wider base of suppliers, ultimately driving decoupled, highly efficient—and more resilient—supply chains.

·         Data infrastructure as a strategic asset

Data is the new oil. The COVID-19 crisis has made having access to real-time, reliable data an absolute necessity in order to coordinate the correct medical response. For Western nations, this will mean greater investment in data connectivity, acceleration of the deployment of 5G networks and a push for more valuable insights into leading economic indicators. Greater connectivity will also mean significantly accelerated deployment of Industrial IoT, including data visualization, sensing, remote collaboration tools and AI-based insights across their operations. Control-tower view of data and insights across the whole manufacturing operation will become a standard component of running a manufacturing organization.

·         Digitization as a competitive advantage

In past periods of economic instability, advances in IoT technologies and AI have allowed for tremendous efficiencies in availability, capacity, and flexibility of supply chain and manufacturing operations. McKinsey even found that companies that have embraced these technologies are already seeing a 7% revenue growth advantage over their peers.

·         Remote work, collaboration and the virtual shift

With social distancing measures in place, manufacturers are at risk for losing up to 50% of their on-site personnel. As a result, we will see the rapid adoption of remote, diagnostic, collaboration and management tools. This will result in the emergence of a “virtual shift”:  a team of specialists connected remotely and constantly online in order to guide and support the reduced “physical shift” of onsite personnel. Enabled by real time data, AI-based insights and a range of communication and collaboration tools, the virtual shift will help digitize and scale much-needed expertise across the organization and enable the onsite workforce to become more focused, effective, and ultimately significantly more productive.

Health Care

Change is well underway for the hospital industry. According to Vox, the pandemic is leaving the following marks on the health care system:

Photo by Christian Bowen on Unsplash

Photo by Christian Bowen 

·         Some hospitals will probably close

Many hospitals have canceled or postponed elective surgeries like heart surgeries and cancer treatments. Hospitals are now laying off staff to keep afloat, as these procedures account for much of their annual revenue. Further, primary care has also taken a hit, as many patients are no longer going in for routine check-ups, with doctors not reaping the income they normally would if they performed surgeries at a hospital.

·         Telemedicine will go mainstream

As government officials have sought to keep healthy seniors away from doctor’s offices and hospitals where they might be exposed to the coronavirus contagion, telehealth has increased in usage. Visits surged by 50 percent in March as social distancing went into full effect, and the total number of phone or video interactions is expected to exceed 1 billion total by year’s end.

·         There will be a push to expand health coverage

Over 10 percent of Americans were uninsured before the pandemic, and that number is likely to skyrocket now that millions are unemployed and losing their health insurance. While any significant expansion of health coverage depends on the outcome of the 2020 election, targeted fixes passed by Congress now cover the costs of COVID-19 testing and treatment for uninsured Americans and some health insurers have waived cost-sharing for their customers during the pandemic.

Tech

According to Kiplinger, COVID-19 is projected to bring about big changes to the tech industry. The following ways are all underway:

1.       Digitization for all

Folks who previously avoided digitizing are now forced to adopt to daily life that takes place online, which includes online banking, video conferencing, remote education, video calls, ecommerce, and more. Households without internet will give in and get service. And those who are digitally savvy will double down on their online habits, they might even consider backup plans like Wi-Fi hotspots.

2.       More hardware sales

More and more people will be buying computers, printers, and other consumer IT gear. As more people work from home, these items are proving to be must-have purchases for remote workers as people will likely want to prepare their home office for a future where remote work is more common. This may also lead to a spike in the purchase of office furniture as well.

3.       A setback for 5G

Due to a reduced demand, the shift to next-generation 5G networks in cities and towns across the U.S. will be delayed. Meanwhile, the supply chain of telecom gear has been disrupted, which was largely based in China. Further, 5G’s debut in factories, warehouses, and shipping ports will be similarly delayed, which will be a big blow for businesses that were poised to boost productivity via upgrades to a company’s wireless network. Further, the global standards for 5G have been halted, freezing an update vital for industrial uses, connecting thousands of sensors and building private cellular networks that can be sliced and diced for different users.

4.       5G smartphones from Apple will be delayed

Global shipments went down 38% last February as closed U.S. retail outlets have certainly hurt sales. In that same token, consumers dealing with a rapid economic downturn are less willing to pay for a pricey new model unless it’s necessary.

5.       Biometrics will go touchless

Since users are more wary about making physical contact with a device or screen, biometric readers will see a steep decline. As a result, contact-free facial and iris detection will see a surge in interest. Microsoft, Apple, and Amazon are among the organizations leading the charge in facial recognition research.

6.       Less privacy online

In order to fight this pandemic and avoid the next one, people will be more in favor of giving up their privacy online in pursuit of safety. According to infectious disease experts, the aggressive tracking of people who test positive for COVID-19 can speed their recover while also preventing future outbreaks. Therefore, the use of smartphones and location data will be critical as Google and Facebook are already in contact with the federal government to share anonymized location data.

7.       VR gets its spotlight

As travel restrictions continue to hamper businesses, smart glasses like those with video cameras and see-through lenses that overlay digital information will see new demand. For example, using headsets that have both Wi-Fi/cellular connections plus headphones, a boss can talk to an employee on a jobsite while seeing what the worker is seeing. Further, AR hardware like that provided by Microsoft can better enable remote work by creating lifelike virtual meetings on jobsites and in the office.

8.       Robotics require innovation to advance

In the near future, expect a steep decline in industrial robot shipments. Yet, in the coming years, the push to automate factories sets up the industry with new applications. Further, some virus-fighting robots are seeing demand now; for instance, UVD Robots’ mobile robot can disinfect a hospital room with ultraviolet light.

9.       Drone delivery will become more common

Drones can be a vital delivery resource during a pandemic, so expect federal regulators to speed up the adoption of delivery drones. The focus will, of course, be on lifesaving uses, such as delivering medicine and virus test kits. Further, some drones will be used for surveillance and monitoring by police.

10.   Undoing the digital divide

At-home education will get a boost, as more federal funding will got to Wi-Fi hotspots for this purpose. To keep up with public demand, lawmakers will take more aggressive action to bring high-speed internet to the millions of Americans who do not have access to the web and therefore cannot work or learn from home.

11.   Demands for remote work will increase innovation

The widespread push for working from home will plant the seeds for better telework software. Investors will also become more receptive to teleworking start-ups as they see businesses more concerned with staying productive. Expect useful new features in the coming months from companies like Slack and Microsoft Teams.

Stefanini Strives to Help

While the above industries aren’t the only ones undergoing change, they certainly are facing some unprecedented challenges. In the next installment of this subject, we’ll look at how banking, retail, and other industries are expected to change post-COVID-19.

In the meantime, no matter how your business is dealing with the pandemic, Stefanini is here to assist you every step along the way.  Check out this page for how we’re responding to coronavirus to get an idea of our solutions, support, and more. 

 

Has your organization been able to adapt to the current situation? We have solutions available for you.