Spotlight

The secret to FACILITY SUPPLIES & PPE/SAFETY FOCUS DURABILITY

German office products manufacturer is Durable by name, and most certainly durable by nature – by Michelle Sturman

The traditional office products industry has been called many things over the years, but fast-moving and experimental are unlikely terms to top the list. Until COVID-19 that is.

For a sector more akin to a carthorse than a racing car, the pandemic caused some OP manufacturers to suddenly switch into top gear and rev into action to protect their business. Germany-based Durable was one such vendor.

Like many other companies, Durable saw demand and sales swiftly collapse from Q2 2020 onwards as coronavirus began to sweep around the world. Simultaneously, customer interest shifted to solutions and products for infection control, hygiene measures and the containment of the spread of COVID-19.

Charged with navigating the firm through the crisis was newcomer Rolf Schifferens, who took up the Managing Director position in early 2020. Having said ‘newcomer’, Schifferens is in fact a veteran of the traditional OP world – he had spent the previous 18 years at writing instruments vendor Faber-Castell, among them as Managing Director of its distribution subsidiary and as a board member.

Preparing to build on Durable’s existing “very healthy pillars”, Schifferens had assigned himself the task of revising certain internal processes and undertaking some restructuring.

He says: “A year ago, the effects of the pandemic were unforeseeable, so the challenges brought about by COVID-19 caught Durable and myself out just as they did everyone else.

“Needless to say, the mandate I had set myself had to wait as the focus shifted to mastering the crisis and being flexible in our response to the new circumstances. Hopefully, we will be able to work on the original goals this year.”

THINKING OUTSIDE THE BOX

The pandemic induced unparalleled disruption for businesses, which created remarkable inventiveness at breakneck speeds rarely seen beforehand. Durable definitely fits into this category as it sought to stem the flow of sales flooding away.

Referring to the company’s core strengths of flexibility and innovation, Schifferens explains that the venture into manufacturing PPE was indeed an idea hatched by a colleague.

“In a very unbureaucratic move, we decided to pursue the concept. What followed was a creative and extremely efficient project. An agile team of experts from various areas such as product development and management, production and sales were put together at short notice to create a face visor.”

Swiftly swinging into action, it took the Durable team just two weeks from proposal to prototype. Manufacturing then immediately commenced in Germany, making an urgently needed product from existing supplies. “Instead of folders and name badges, we were manufacturing face visors. They can be used as attachable shields to support those

DURABLE IN NUMBERS

Office and manufacturing

facilities: 15 Staff: about 700 Revenues: €100 million ($119 million) Portfolio: office supplies & filing; information & orientation; facility & warehouse equipment; new work solutions

Product

distribution: 80+ locations worldwide

not protected by fixed plexiglass walls in direct customer contact,” explains Schifferens.

Durable’s face visors are EU certified (CE-compliant PPE according to EU 2016/425 category II and EN 166:2001) with Optical Class 1 – the highest level of visual clarity because of the highly transparent polycarbonate. This enabled the visors to be sold throughout the European market. Such was the demand for PPE items last year that part of the vendor’s production facility in Poland also had to be adapted to make the visors.

The global procurement of PPE has for many been fraught with difficulties which included the supply of raw materials, shipments and appropriate certification. By switching existing resources that would otherwise have produced binders and folders to be used for manufacturing PPE, Durable and its customers bypassed these obstacles with relative ease.

BOOSTING SALES

Face visors are considered essential equipment in the fight against coronavirus and are used in a wide range of environments – from doctors’ surgeries, retail and beauty salons to academic institutions and workshops. This demand helped offset declines in Durable’s traditional product set. It also offered the vendor inroads into different distribution channels, access to new customers, and the ability to participate in relevant public tenders.

For its dealer customers, meanwhile, the COVID-19 hygiene range, which includes signage, bins and disinfectant dispensers, has been a real boost. And although the selection has been primarily distributed through its established trade network, online channels have also been an important route to market. While Schifferens did not reveal explicit numbers, he says e-commerce represents a “relevant sales share”.

And work hasn’t stopped. According to Schifferens, the material used has been revised over the past few months resulting in improvements to the visors. While the face shield is able to be disinfected and reused, replacement foils can also be sold, thus providing recurring revenue streams for resellers.

Importantly too, the face visor is completely recyclable, a critical element in the fight against the rising mountain of single-use PPE now littering the planet.

Aside from the success of the visor, other items in Durable’s portfolio have been adapted to meet COVID-secure workplace requirements. A prime example is its Duraframe product which provides safety and other relevant information. “In this way, we were able to make up for at least part of last year’s lost turnover,” Schifferens adds.

He expects the current hygiene range to remain relevant even after the pandemic subsides as employees begin to return to their offices and efforts to ensure a safe and hygienic working environment ramp up.

That said, Schifferens does not believe the category will increase beyond its present, albeit high, sales level. But there will be other growth opportunities as initiatives for new and flexible workplace models and logistics get underway.

Instead of folders and name badges, we were manufacturing face visors

THE SECRET TO SUCCESS

Durable celebrated its 100th anniversary on 7 February 2020. OPI asked Managing Director Rolf Schifferens about the formula for the company’s longevity and success.

“The secret is consistency and diligence. Importantly, we have constantly developed as a business. With an ear to the ground, we take notice of the needs of the market and implement them. This has enabled Durable to enjoy robust growth which, as a result, means we are financially in a solid position.

“Absolutely vital too, we treat our staff fairly and enjoy a high level of employee satisfaction. However, we are not fooling ourselves: the pace of change has never been so fast. The challenges are continuously growing.”

FACILITY SUPPLIES & PPE/SAFETY FOCUS

Prevention

IS BETTER THAN CURE

2020 was a stellar year for those involved in the PPE, safety and facility supplies arena due to COVID-19. But as vaccines are being rolled out across the world, what does this mean for 2021? – by Michelle Sturman

The outlook for the PPE, safety and facility supplies sector appears to be a mixed bag. As the saying goes – or at least a variant thereof: “What one hand giveth, the other taketh away.” This pretty much sums up the general picture for 2021.

As the pandemic hopefully relents over the next few months, lockdown restrictions ease, and workplaces begin to fully open again, the supersonic boost that PPE in particular has enjoyed will lessen.

Frank Hoard, Director of the Facility Supply Channel at US-based Independent Suppliers Group (ISG), remarks: “As we’ve learnt more about the way the SARS-CoV-2 virus is transmitted and subsequent vaccines are made available, we expect to see much of the pandemic-related products demand to dwindle outside of the frontline healthcare channel.”

UK-based CTS Toner Supplies is a distributor that quickly added PPE lines as part of its standard product supply last year. Commercial Manager Nick Brooks says the company learnt not to have any expectations related to PPE as supply and demand is difficult to predict. However, in terms of core PPE, he forecasts a purchasing uplift when the retail and hospitality sectors reopen.

CTS recently introduced Panodyne antigen and antibody testing kits. “Our COVID test sales will subside when the vaccines deliver a national impact, but other items such as anti-bac and face masks will be here for a long time to come. As for future growth, who knows, but we remain equipped to take on new products – oximeters, for instance – if there is dealer demand,” he adds.

While distributors and resellers rapidly added items to their available line-up in a bid to retain revenue and aid in the fight against the virus, vendors have equally seen a swing in product mix.

Take Spectrum Industrial, for example. The UK-based firm experienced a “considerable shift” in Q2 2020 as safety product sales – its mainstay range – declined. This was more than offset by rapid revenue growth in social distancing signage, which the firm quickly created and launched in late March 2020.

PRODUCT MIX SHIFTS

Periods of lockdown have created ups and downs, as the company’s Channel Manager Steve Plaistowe explains: “As we came out of ‘lockdown 1’ in the summer of 2020, core safety ranges rebounded as offices, manufacturing and construction sites reopened. As the year progressed, this category continued to recover, and social distancing signage stabilised somewhat. This pattern followed through to the end of 2020.”

According to Plaistowe, the latest lockdown, which began at the start of 2021, challenged its core market once again, although outbound sales recovered strongly in February, with ongoing expansion expected for the remainder of the year.

“We’ve also seen a resurgence of more bespoke signage used as part of interior redesigns, which encouragingly shows some

confidence for the future. As for social distancing range sales, they remain stable and at a rate that provides good value, though we do expect a gradual rundown of these as the UK, hopefully and finally, exits lockdown.”

Avery is another vendor that has experienced an uptick in some safety-related products such as its GHS Chemical Labels for labelling secondary containers of cleaners and workplace chemicals. Group Product Manager Colwin Chan expects the COVID-related spike in sales will continue for the first half of 2021.

The company also introduced new products to aid in the fight against coronavirus. “In the early days of the pandemic, we worked with our sister companies to offer PPE, including 3-ply and KN95 masks, to help alleviate the shortage at the time. In addition, we quickly launched adhesive floor signage to assist with the need for COVID-19 social distancing communication.”

INCREASED AWARENESS

Stationery manufacturer ExaClair – part of the Exacompta Clairefontaine group – saw excellent demand for its ExaScreen range of PPE when this launched during the start of the global pandemic. So much so the company has seen it account for over 40% of its growth categories.

Marketing Manager Lawrence Savage told OPI that the anticipation is for the category to remain an area of strength throughout 2021. He says: “The past 12 months have certainly increased awareness of and demand for effective PPE across a number of industry sectors, especially those which fall outside of the industries traditionally associated with its use.

“Forecasts show the global PPE market will more than double over the next five years, with an estimated value of over $33 billion by 2026. Items that feature innovative technological elements, known as ‘smart PPE’, are also predicted to produce a significant impact in the next few years.”

In fact, the global smart PPE sector is expected to reach almost $8 billion by 2027, with a CAGR of 15.9% during this period, according to research firm Fortune Business Insights. But what exactly is smart PPE?

EU-OSHA, the European Union information agency for occupational safety and health, states that in most cases, smart PPE is traditional PPE combined with electronics such as sensors, detectors, data transfer modules, batteries, cables and other elements.

With the advent of AI, industrial IoT and 5G, data can be used to provide real-time critical information to ensure safer working environments. For example, during the past year in the battle against COVID-19, smart helmets with thermo/ infrared cameras have been utilised by law enforcement to scan body temperatures.

While specialist smart PPE may be beyond the realm of many dealers in the near term, ISG’s Hoard believes more technology-based products are being adopted within the channel. Here, he refers to items like touchless thermometers, temperature station technology, hydrogen peroxide-based disinfectants and metal ion surface barriers, which have been available for years.

HIGHER STANDARDS

As the varying responses to the coronavirus crisis from governments dictate the reopening of society, a return to the office and the reduction of PPE, certain subcategories within the PPE, safety and facilities supplies sector will undoubtedly fare better than others.

Safety and cleaning will become imperative as offices begin to reopen and businesses require a COVID-secure operating environment. One school of thought suggests there will be no ‘new normal’ as regards significant workplace enhancements in terms of safety, health and hygiene once the pandemic is over. Most experts and industry spokespeople wholeheartedly disagree.

While there may be fewer employees in the office at any one time as hybrid working takes off, it will still be necessary to maintain a hygienic and safe work setting. Perhaps even more so if hotdesking becomes prevalent and staff object to sharing workspaces that haven’t been thoroughly cleaned, sanitised and disinfected.

The potential for COVID-related products – especially hand sanitiser, safety signs and sneeze guards – in the office looks set to increase as employees will demand better working conditions going forward.

A recent global survey undertaken by health and hygiene manufacturer Essity highlights the fact that almost half (47%) of respondents said they have higher expectations of hygiene standards in the workplace after COVID-19 (see ‘Essity Essentials Initiative Survey 2020-2021’ on page 36 for more coronavirus-related information).

The past 12 months have certainly increased awareness of and demand for effective PPE across a number of industry sectors

Spectrum Industrial’s floor graphic

Julia Vorley, Marketing Manager of specialist cleaning solutions manufacturer AF International, says the company is still experiencing a high volume of sales. Fortunately, AF already had a full range of antibacterial certified and registered products to respond to demand.

“I believe a heightened awareness of a good sanitising routine has been taken on by a large chunk of the population, and this will persist and become normal. For instance, nurses wearing face masks in hospitals. Individuals will be a lot more mindful of their behaviour as there has been such attention on this topic.

“I don’t think sales will maintain the frenetic rate experienced last year in terms of panic buying, but people will still be conscious of the requirement,” she adds.

ISG’s Hoard concurs, adding that hand sanitiser will continue to be purchased well above pre-COVID levels. But he says there is a push to move to a bulk system so end users aren’t at the mercy of proprietary systems where refills are unobtainable in a time of crisis.

“There is definitely a focus on pandemic products and safety items now within the workplace. We’ll equally see more individually wrapped breakroom items and personal cleaning products, like disinfecting wipes, being used to clean not only the individual employee workspace, but also common areas like lobbies, boardrooms and cafeterias,” he adds.

ExaClair’s Savage notes high interest in its Clean’Safe range, which incorporates a collection of filing and desktop accessories that have been treated with an antimicrobial additive to stop the spread of viruses and bacteria.

DO THE RIGHT THING

The popularity of the aforementioned products is unlikely to reduce in the near future as people are more keenly aware of the necessity for higher hygiene levels. Additionally, many countries have introduced legislation to bolster health, hygiene and safety measures.

Says Peter Cowan, Procurement Director of UK-based distributor Data Direct: “Due to the pandemic, many safety manuals have been updated to include elevated levels of PPE requirement, and this will not be easily reversed. It does mean increased demand will remain due to legislation alone.

“The hope is that individuals, as well as companies, will take it upon themselves to ‘do the right thing’. They will increase hygiene levels as a matter of course, and get used to applying PPE and cleaning solutions more readily than before.”

Getting up to speed on mandatory requirements may take time and resources, but Cowan believes opportunities lie within. “Dealers need to understand the legislation and make certain anything they are offering meets all of the required standards. There is definitely the potential of a consultative role as part of the service, which could easily be done without having to burden end users with extra cost.

“Supporting customers to create/rewrite their internal hygiene manual would be a real statement of support from the side of the dealer, and thus breed trust and loyalty,” he comments.

Savage echoes this sentiment, adding: “As with the successful supply of any product category, it’s not just about sourcing the most popular stock. The key is for dealers to take on a greater consultancy role, advising the consumer on where and how to best utilise its PPE equipment. In relation to this, more dealers are now expanding their support services to incorporate personalised office design layout solutions.”

As Essity North America Brand Activation Director Thomas Borrmann points out, the requirement for higher hygiene standards in workplaces, combined with new laws across all countries in Europe, has resulted in customers looking for an even broader offering.

ExaClair’s Clean’Safe antimicrobial range

There is definitely a focus on pandemic products and safety items now within the workplace

Avery’s Surface Safe sign labels

What are your sales expectations for COVID-related products in 2021?

n Worse than

last year

n Same as

last year

n Better than last year

20%

22% 58%

“During the crisis, legislation has been introduced at a unique pace, mainly focused on hygiene practices and PPE products, with rules differing based on the location, setting or even stage of the pandemic. The most obvious is the requirement for people to wear a face mask indoors.

“Regulations have recently shifted to a focus on approved medical device masks. For some countries, it relates to Type II or Type IIR face masks, and even in parts of Central Europe like Austria and Germany, FFP2 respirators are the legal requirement in public,” he adds.

HERE TO STAY

By all accounts, even with the current vaccination programmes rolling out – albeit to varying degrees of success globally – COVID-19 is likely to stay with us just as the flu and common cold are. Says CTS Toner’s Brooks: “For this reason, I think people will continue to be vigilant of social distancing, sanitising and wearing face coverings.”

Until the whole world has had the jab, the expectation is for intermittent coronavirus flare-ups, which means for the foreseeable future a continued heightened interest in PPE, safety and facilities supplies. “Enhanced cleaning protocols and safety measures will likely remain the norm moving forward due to the threat of new COVID strains and mutations,” agrees Avery’s Chan.

While the supply chain is still struggling in many regions with lots of PPE products unobtainable from pre-pandemic sourcing channels, the business supplies industry has demonstrated it can rapidly adjust and continues to pull together.

ISG, for example, has developed the Discover Your Next Move programme to assist members in navigating the ever-changing business environment being impacted by COVID-19 and other significant industry developments.

Explaining the rationale behind the strategy, Hoard says: “ISG doesn’t do this alone. We’ve incorporated members, vendors and various outside speakers to help ISG dealers adjust to the ‘new normal’, with valuable tools and information specifically dedicated to anticipating change. Our goal is to help our members think and act in a proactive manner.” Every two years, global health and hygiene company Essity conducts its Essentials Initiative Survey, providing valuable information on attitudes, preferences and habits from around the world. The latest questionnaire was conducted digitally with about 15,000 respondents from 15 countries between December 2019 and January 2020.

A supplementary survey carried out in July 2020 involved hygiene and health questions concerning COVID-19. There were over 10,000 respondents in ten countries – France, Germany, Italy, Mexico, the Netherlands, Russia, Spain, Sweden, the UK and the US.

Concerning the COVID-19 survey, some valuable key takeaways emerged. Since the spread of the virus, 68% have changed the way they wash their hands, seven in ten respondents said COVID would spread less quickly if people were better at washing their hands, and six in ten do not shake hands with others anymore.

However, the way people wash their hands differs quite substantially. 83% wet their entire hands with running water, and 82% apply enough soap to cover wet hands, but only 36% rub under their nails and 62% wash for 20 seconds or more (the recommended time to thoroughly clean hands). Meanwhile, 24% turn off a tap with a clean cloth or single-use towel, 55% dry their hands with a clean cloth or single-use towel, and 24% apply hand sanitiser after washing hands.

Staying with hand sanitiser, 33% of global respondents said it is more effective than washing hands, 21% don’t wash their hands but use sanitiser instead, while over two-thirds (69%) believe it is a good complement to handwashing.

Interestingly, when asked the main reason for not washing hands more often, 41% said they did wash their hands enough, but for those that didn’t, a lack of soap or hygienic soap dispensers in facilities was the top answer (15%). Next was access to proper handwashing facilities in public spaces (14%), then forgetting to wash hands and hand dryness (both 11%).

Overall, people have become more aware of health and hygiene in society over the past year. One in two survey respondents said their view of what products are essential in daily life has changed since coronavirus, with six in ten placing higher standards on the hygiene products they use. 61% stated product quality as the most important factor, while 55% considered the ability to reduce the risk of infection when buying hygiene products. Three in ten believe global hygiene standards need to be raised to prevent new pandemics.

To read the full report, visit https://reports.essity.com/2020-21/ essentials-initiative-survey.

For more opinions on topics such as hybrid working, sustainability, the gloves market and new product developments, look out for our Xtra content in the March/April 2021 issue on opi.net

Physical collaboration has taken a backseat over the past year. But communication has been as visual as ever

– by Heike Dieckmann

Several product categories in our industry have been catapulted to astonishing heights during COVID-19. Previously unsung heroes such as PPE and jan/ san firmly fall under that umbrella (see also ‘Prevention is better than cure’, page 32). Other segments, particularly traditional office supplies including filing, desktop accessories or paper, have seen steep declines.

Visual communications (viscom) sit somewhere in the middle. This is a sector that prior to the pandemic had enjoyed buoyant growth for some time. From a focus on better collaborative solutions in the workplace as well as in education settings – many of them increasingly interactive – to more environmental awareness and evolving style and fashion trends, a whole set of drivers propelled that growth.

But from Q2 2020, viscom quite literally had to go back to the drawing board and adjust to some new realities. Bizarre though it sounds, the category now comprises items that, in their vaguest remit, are part of the PPE and hygiene stable. Boards with surfaces which have antimicrobial properties, can withstand harsh cleaning materials or, quite simply, double up as space dividers, may not be new, but they’ve certainly enjoyed a phenomenal rise in popularity and have become standard requests among customers in the workplace.

As Susan Claus, Director of Marketing of the Ghent, Waddell and VividBoard brands at GMi Companies in the US, explains: “For years, our brand tagline has been ‘communicate, collaborate and learn’. That philosophy has not changed. Our products are still vital to communication, never more so than during times of crisis. A year ago, no one had heard of an acrylic desktop divider, a thermoplastic screen, or have a need to divide space as much as they do now.

“These items might not be what you call traditional communication products, but they all allow people to be in the same room and have face-to-face conversations safely. They have enabled employees to return to their offices and students to classrooms.”

MIXED FORTUNES

How the various manufacturers – and their channel partners – in this segment have fared very much depends on who you talk to and the markets you’re talking about. Danny Berendsen, European Sales Director at Portuguese viscom vendor Bi-silque, says: “Overall, we had a 20% decrease in sales in 2020, driven by a significant decline within the traditional contract stationery and dealer channels.

“We saw a clear shift to digital, partly with pure online players and DIY stores that have been growing exponentially as they are more B2C focused; but also with wholesalers which have been focusing mainly on online dealers and directly drop-shipping to end users on their behalf.”

Elaborating on specific locations, he adds: “Scandinavia, the DACH region [Germany, Austria, Switzerland] and Benelux have suffered the

Above and bottom left: Bi-silque’s Magnetic Drywipe Safety Floor Signs

least from the lockdowns in the first wave of the pandemic as most businesses were operative and people could still go to the office if needed.

“On the other hand, Italy, Iberia and France have seen severe lockdowns where companies were urged to close their doors by the government. It appears that these countries, however, were more cautious in the second wave in order to keep businesses and schools open.

“Our number one market is the UK, and here –on top of everything else – Brexit has complicated exports from Portugal into the UK, putting pressure on the required lead times and availability levels.”

VISCOM TRENDS

But while specifics differ vastly, some core trends can be applied fairly broadly. Demand for viscom products in the homeworking environment has soared, for example. As such, many operators have expanded their ranges to include more items catering for this sector.

Suzanne Tiernan, Head of Sales UK & Ireland at Dutch viscom mounting specialist NewStar, says: “We moved quickly to enrich our existing products to support the home and flexible worker. Laptop stands, phone holders as well as additional items in our core desk and wall mounting ranges all complement the mix in NewStar’s existing portfolio.”

Berendsen also refers to the home office market and the opportunities it brings: “Work-from-home is here to stay, even after the pandemic. Solutions like personal boards will therefore remain an important category. People need to organise and plan, and they use boards to do that. Most employees had to create a new working space at home, so this particular sub-segment has had a growth rate of 300-400% over the past year.”

As a result of viscom being used in personal spaces such as the home, product preferences have also changed, with wood frame boards, natural and coloured frames as well as chalkboards being popular. Interestingly – and to the detriment of B2B distribution – these products are predominantly bought through online and retail channels.

CHANGING NEEDS

Other items that have witnessed record sales are display and signage products which communicate the new rules everyone has to follow. They are prolific in a wide variety of environments, among them factory floors, essential retail outlets and education settings. And here, OP B2B resellers have benefitted too.

As the world begins to return to something approaching normality, demand for these viscom ranges will only accelerate, particularly in office spaces where historically popular items such as large boards – revolvers and flipcharts – have seen severe declines due to less physical collaboration in the workplace.

Driven by the change in how employees operate and communicate now, NewStar’s Tiernan instead refers to growing interest in audiovisual (AV) communications. She says: “Last year, we launched the new NeoMounts Pro series, offering a complete AV range. The next step from this is to encompass LED solutions as part of the next generation of Pro AV.”

Paul Kaminski, Director of Technology at US independent Innovative Office Solutions, agrees. In this new age of virtual meetings, what customers have been asking for, he explains, is help with setting up video capabilities in conference and training rooms, and huddle spaces.

The future certainly looks positive, he comments: “Viscom is a category that is growing 8-10% per year. Demand has started to pick up again as customers have spaces they are committed to finishing due to back-to-the-office plans. There is not one remodel which does not include this category.

“The challenge is to keep it simple for customers to understand the solutions. Importantly also, we work closely with our sales teams so they can introduce this category and bridge the relationship from office supplies buyers to IT buyers. Innovative Office Solutions has the ability to offer a single source and one project manager – that is a distinct advantage over our competitors.”

Global vendor ACCO Brands has agreed to acquire leading Germany-based brand Franken through its Leitz subsidiary. Franken is a supplier of viscom products, boards, planning, creative and training items and, subject to the transaction being approved in early April by the German antitrust authorities among others, will join ACCO’s already well-known viscom brands Nobo and Quartet.

“In a reinvented post-pandemic Office 2.0, where there will be an increased focus on a physical ‘get-together’ for collaboration, meetings, brainstorming and co-creativity, [Franken] will give us a stronger position in the markets and categories where we operate,” stated Ard-Jen Spijkervet, Managing Director of Leitz ACCO Brands.

Demand has started to pick up again as customers have spaces they are committed to finishing due to back-to-the-office plans

Middle and below: NewStar’s NeoMounts Pro AV product & Ghent’s desk to floor partition

In this How To… guide, Matthijs Rosman identifies the signs to look out for when your industry is being disrupted, and reveals some of the response tactics

It’s a time of unprecedented change. In many respects, it is unchartered territory, as never in our lifetime have we experienced this kind of transformation with such impact. Our ability to adapt is being tested, and it’s not difficult to find ourselves exposed to some fundamental existential issues. We are truly encountering a reset.

What I like about the word ‘reset’ is that it embodies an opportunity. It allows us to take a hard look at who we are and what we want and can be – in life and as a business. COVID-19 is turning out to be a great disruptor. I believe in the mantra ‘never waste a good crisis’, and companies that are willing to use this reboot will come out on top.

We have the power to reinvent ourselves. To decode what we are and to recode ourselves to be fit for the future. The next couple of pages are dedicated to understanding the process of disruption and what to do about it.

WHAT IS DISRUPTION?

Disruption is a process where major shifts in an industry’s order are brought about. Incumbent players must rethink their businesses to stay relevant in the face of altered industry dynamics. We often hear about turmoil related to start-ups, with seemingly insignificant players upsetting large companies – either forcing them out of business or leading a notable change in course.

Disruptors start by gnawing away at market share and then eating into profitability. Innovators establish a hold on a market while existing firms focus on improving their products and services for their most demanding clients.

The entrant taps into overlooked segments and gains a foothold by offering a proposition with more suitable functionality. When mainstream customers start to adopt the newcomer’s offering in volume, the market has been disrupted.

There is one of two trajectories for industry disruptors: the low-end position as just described, or the new market foothold. In the latter instance, start-ups establish a new market by providing a proposal to a segment previously uncatered for.

ANY INDUSTRY CAN BE DISRUPTED

As part of ongoing research on innovation performance, RevelX has found that more than 70% of respondents think their business will be disrupted. It can happen to any industry, and

with the lifespan of an average company under 20 years as it stands, 75% of the current S&P 500 firms will have disappeared by 2030.

There are eight leading indicators an industry is about to be sent into disarray.

Signal 1: Your assets are commoditising

When company assets start becoming commodities, innovators will be around the corner. They will use your assets and build their business on top of it. Without the burden of having their own expensive assets, they will be far more profitable in no time.

Signal 2: Your assets are underutilised

Do you have assets that are idle most of the time? In come the firebrands to use them and make their fortune. A prime example is Airbnb, which uses unoccupied beds and rents them out to customers. Asset-heavy industries are sitting ducks to disruptors.

Signal 3: Lack of transparency

When an industry is clouded by a lack of transparency, be on the lookout for companies that are seeking to pierce the veil. To outsiders, non-transparent business models are suspect of hidden value.

Take the market for airline tickets. The pricing model was a complete black box until it was opened up by the likes of CheapTickets and Google Flights.

Signal 4: Low or no added value

When an industry includes players that add low or no worth, disruptors are keen to rationalise the value chain and make their money from trimming away some of the fat.

All manner of brands have gone direct-to-consumer and cut out the middleman. It’s a gutsy move, but done well can deliver a lot of value and countless existing companies must contend with competitors going direct.

There is an obvious issue here. Many businesses are heavily invested in their current value chain, either by choice or as part of their legacy. Disruptors will not have this problem.

Signal 5: Platformisation

When an industry is turning into a platform business either through the bundling of offerings or servitisation, be wary of newcomers. Attention from big platforms like Amazon is also a dead giveaway – they will closely monitor your sales and then decide whether to launch a version of your products under their own brand.

Signal 6: Serious use pains

If customers in a market experience serious pains in using your products or services, someone will come in and simplify the job for them. Smart digital tools make complex jobs easy.

A great example is the case of property and casualty insurance firm Lemonade. It uses smart digital tools to buy insurance coverage in minutes and settle claims rapidly.

Signal 7: Too much focus on products/features

When discussing the process of disruption, I talked about incumbent companies being overly focused on products and features for the most demanding customers. If you find yourself in that trap, a new entrant will be happy to pick up the crumbs from the business you left behind.

Signal 8: Attention from venture capitalists

Lastly, when venture capitalists enter a market at speed, you can be sure transformation is round the corner. It’s a telltale sign there is money to be made in your industry.

When venture capitalists enter a market at speed, you can be sure transformation is round the corner. It’s a telltale sign there is money to be made in your industry

Matthijs Rosman is a Partner at innovative growth consultancy firm RevelX in the Netherlands. He is also the co-author of leading business bestseller ‘DARE – The Mindset of Successful Innovators in the Digital Age’ HOW TO RESPOND TO DISRUPTION

Often, business leaders initially ignore the signs of upheaval. When they start to feel the effects of a sea change either through the loss of market share or erosion of profits, there is a fierce reaction. After a short mourning period, they start questioning the legality of the disruptor’s business practices and lawsuits follow. This is a destructive path.

So, what would be a better response? My advice would be to take matters into your own hands. Innovate your way out. Here are some strategies.

Open up

It may sound counterintuitive but open your business up to potential disruptors. Unbolt the door for start-ups that may one day turn out to become a competitor and give them access to your infrastructure and resources. Better to keep (potential) enemies close and learn from them.

Take them out

Buy the agitator. Combine your strengths with those of the disruptor and build new value. Be cognisant of leaving enough room for them to grow and flourish – in other words, do not suffocate them in your corporate system.

Copy fast

Replicate the firebrand business model fast and use your market presence and strength to beat the disruptor to the punch. Beware you may lose the actual customer need you’re trying to address in a simple copy action.

Outperform the disruptor

Become a better trailblazer than the disruptor. By adopting a mindset of continuous innovation, you leave no room for this intruder. Disrupt yourself. Apply the same principles of revolution to your own business.