New start for business and society

We have lived through difficult months. And it is no surprise that we have often been confused. At times the world seems to be wobbling on its axis, upsetting old certainties and radically changing the way we all live. It is no wonder that people retreat into models of apocalypse or dystopia.

It is an odd combination of the frenetic and having time on our hands, and it is easy to think the worst or the radically different. When we entered the period of the pandemic, the world of business, economics and politics was already showing uncertainty about which way it should turn on the trends of globalisation and populist governments.

Fragility

It is a cliché to say that the virus knows no boundaries, but that simple fact has radically undermined the comfortable thought processes that existed before its arrival. Before 2020, many governments were saying they could get along just fine without the markets they had traditionally relied on. The UK was spurning the other nations of Europe that represented the bulk of its trade, while the US was declaring it could thrive happily without much of its global trade reach. All this falls over in the face of a virus that obviously can only be dealt with finally and effectively by crossborder action.

‘The pandemic has shown how fragile some ideas are,’ says George Bull, senior tax partner at accountancy firm RSM in the UK. The whole concept of just-in-time supply chains is suddenly seen as fraught with danger and difficulty. What had been a smoothly functioning system is now suddenly beset with disruption, with the result that global supply chains are pulled back.

‘The pandemic has shown how fragile some ideas are,’ says George Bull, senior tax partner at accountancy firm RSM in the UK. The whole concept of just-in-time supply chains is suddenly seen as fraught with danger and difficulty. What had been a smoothly functioning system is now suddenly beset with disruption, with the result that global supply chains are pulled back.

Populism

Meanwhile the populism of UK prime minister Boris Johnson and former US president Donald Trump fared badly across the first year of the pandemic. It has often been the most aggressively individualistic states that have come out worst, but even here the contrasts are telling.

As one economist put it recently: ‘In the UK we asked for volunteers to help the health service out. They hoped eventually to have three-quarters of a million people come forward. On the first day a million applied. But in the US the first thing that happened was queues forming outside gun shops – it was hardly the community pulling together.’

Shifting sands

As so often happens, the business world changes quietly, without people really noticing at the time. It happened back in the 1970s in the UK. It was a time of huge disruption. The economic landscape was bleak. There were many strikes, and a three-day working week was imposed on industry in the face of a miners’ strike that hit power generation so hard that we were exhorted to brush our teeth in the dark to save electricity.

But the tectonic plates of change were shifting. The UK economy quietly pivoted from a reliance on moving hefty engineering outwards to an inward surge in demand for expertise. It was about ideas, and globalisation took off. In just the same way we should expect big changes from the days of the pandemic. They will, as in the 1970s, be subtle, long term and not necessarily obvious. They will not come in the form of ministerial press releases.

Globalisation will inevitably remain a powerful force. The nature of the internet and communications guarantees that. But it may be that the overwhelming lesson of the battle against the virus is that rapid organisational change and the power of small groups of individuals in business will remain as the main influence. The power of the pivot at speed and what can be done can outlast the uncertain days of the pandemic.

The overwhelming memory of our emergence from these difficult and sometimes terrifying times will be that people, often very ordinary people, were what gave everyone strength.

Community model

The economists Paul Collier and John Kay published a short book called Greed is Dead: Politics after Individualism at the height of the pandemic. There is an eerie prescience about it. ‘Our vital resource,’ they argue, ‘is community.’ The pandemic has hastened the need to come together. ‘Communities,’ according to Collier, ‘are hardwired to bond together fulfilling obligations to the whole.’ Instead of a discredited theory based on maximising shareholder value, a new model may rise from the collective experience of the pandemic.

The book argues for ‘a characterisation of society as a myriad of small organisations, within each of which people find common purpose, and which collaborate in larger groupings for those common purposes that need scale’. It is a view that connects shell-shocked populations everywhere.