Responding to the COVID-19 crisis: the rapid turn toward digital business models

Abstract

Purpose The effects of the spread of COVID-19 across the world are devastating, both from a health and an economic perspective. However, we also see encouraging examples of collaborative and innovative initiatives, in society and in organizations. The purpose of this paper is to focus on initiatives related to digital business model innovation. The authors explore how organizational characteristics provide a variety of opportunities for digital responses to the COVID-19 pandemic and discuss the potential consequences for the speed of digital transformation in organizations and society. Design/methodology/approach In this paper, the authors analyze how organizations attempt to mitigate the negative effects of fighting COVID-19 using digital business model responses. The authors draw on a qualitative study where they have collected data from the retail and service industries. They have analyzed the data in relation to theory to better understand this ongoing phenomenon. Findings The authors have identified four categories of organizations (crisispreneurs, accelerators, endurers and thrivers). Each category faces different challenges and shows a different intensity in their digital transformation. The authors propose that the rapid turn toward digital business models will have enduring effects, as organizations have gained transformational capabilities that will remain, and that the digital trajectory has, as a result, changed forever. Originality/value The findings in this paper point toward new challenges for leaders and policymakers in terms of how to support initiatives and meet the needs of different categories of organizations while simultaneously being conscious of the potential societal effects of this rapid digital shift. The authors hope that this paper can be of value for managing this shock and learning how to adapt for the future taking certain aspects of current business models as the departure point.

Exploring the COVID-19 pandemic impact on innovation and entrepreneurship – Review and evidence from Global Innovation Index

“…Frugal innovation can be incentive that determine enterprises to redesign processes and adopt rapid decision making. Digital business models and can help companies surpass difficulties and develop frameworks that increase their competitive advantage (Dabic et al, 2022;Jha, 2021;Lichtenthaler, 2021;Kronblad & Pregmark, 2021). Entrepreneurs and usually small and medium businesses have been the most affected by the pandemic and the results show that a rapid decision-making process and adoption of agility can help solve better the problems encountered.…”

Impact of Covid19 on the development of digital service capability for value co-creation: a mediating role of service ecosystem self-adjustment

“…To survive the tremors of Covid19, businesses people have to show agility in improving the inclusiveness of their business models and operations, like adopting online distribution and robotic uses in delivering products or services to customers and using online payment for survival purposes (Mende et al, 2019;Saputra et al, 2022). Adopting innovative digital business models is essential for empowering supply chains to reach customers easily by doing away with intermediaries and going for price transparency and cutting down marketing costs by investing in technological infrastructure as technology is now essential for business continuity and resilience (Kronblad & Pregmark, 2021)., Likewise, people can opt for simple technologies and use platforms like social media, mobile devices and computers to enable interactions with customers in the digital environment (Yadav & Pavlou, 2020) as well as partner with other actors who are experts in digital technology to scale-up digital skills like information and communications technology (ICT) skill, data privacy and security management, ability to resolve customers' problems remotely, communicating by electronic means and handling automated system to monitor and control customers actions as well as digital identity (Jisc, 2019;Nasiri et al, 2020) and machine learning to improve service delivery (Hoffman & Novak, 2018).…”

“…Service ecosystem well-being can be sustained or destructed by behaviors of internal forces like actors or external forces like the present case of Covid19 (Frow, McColl-Kennedy, Payne, & Govind, 2019). Given the unforeseen phases of Covid19, business people demand to be proactive, equip themselves with digital service capabilities and transform their traditional business operations into digital operations models (Kronblad & Pregmark, 2021). Business people have to rethink their digital capabilities as well as their customers for the co-creation of value (Gu et al, 2021).…”

Getting on track for digital work: Digital transformation in an administrative court before and during COVID-19

“…Similarly, one can view COVID-19 (or rather the restrictions imposed to battle COVID-19) as an additional exogenous trigger for change that organizations respond to. However, COVID-19 also has a particular relation to digital transformation as it has increased the pace of change—where social distancing and quarantine regulations have increasingly moved physical workplaces into digital alternatives ( Kronblad and Pregmark 2021 ).…”

“… Leicht and Fennell 2008 ; Scott 2008 ; Suddaby and Viale 2011 ; Lefsrud and Suddaby 2012 ; Adler and Kwon 2013 ; Empson, Cleaver, and Allen 2013 ; Muzio et al 2013 ; Noordegraaf 2016 ; Heizmann, Mastio and Ahuja 2020 ; Noordegraaf 2020 ), there is limited knowledge about the interplay between institutional and professional barriers in the digital transformation of work practices ( Muzio et al 2013 ; Hinings, Gegenhuber and Greenwood 2018 ). Indeed, it is becoming increasingly relevant to understand barriers to digitalized work as the pressures to implement digital work practices have increased, not the least because of societal efforts to combat the spread of COVID-19 ( Kronblad and Pregmark 2021 ). While the connection between efforts to prevent the spread of COVID-19 and the turn toward digital ways of working is relatively straightforward (in that digital technologies allow for social distancing), we only have limited knowledge about how COVID-19 has impacted digital transformation in terms of new behaviors and motivations toward adopting digitalized work.…”