A 3-Step Process for Thriving in the On-Demand Economy

The on-demand economy has introduced myriad challenges for businesses as they strive to meet consumer needs. Fortunately, these simple strategies can help you navigate it with ease.

Written by Rob Armstrong
Published on Jun. 15, 2022
A 3-Step Process for Thriving in the On-Demand Economy
Brand Studio Logo

We’re constantly reminded that we’re in an “on-demand economy.” But what does that really mean? That we can buy whatever we want, whenever we want, without ever having to go to a store? That sellers and service providers must cater to our every whim and work on our timelines? That we, as consumers, dictate what is produced and when instead of the manufacturers themselves?

At a fundamental level, the on-demand economy is all about convenience and simplicity. But there’s a certain irony to the consumer value proposition that’s actually complicating things for most businesses: it is neither simple nor convenient to serve customers on demand.

You probably feel like you’re at customers’ beck and call and that running a business — or managing business systems — gets more complex by the minute, right? You may even believe that consumers are the sole beneficiaries of the on-demand economy and that you got the short end of the stick as a retailer, restaurateur, warehouse operator, healthcare provider, manufacturer or service provider. 

But let me remind you that you’re reaping the rewards of the on-demand economy, too, in part because you’re also somebody’s customer. If you need something tomorrow to keep your business running smoothly, you can place an online order and expect the seller to ship it either the same or the next day (current supply chain challenges notwithstanding). You can hold others to the same high standards you’re being held to by your customers. 

The on-demand economy enables you to go to market with haste and create new revenue opportunities practically overnight. Plus, you now have new ways to differentiate yourself beyond your products. Your success can be based on how well you know your customers and how quickly you can operate your business to best serve them. I’ve seen companies completely upend their business models and become competitors to companies that were previously customers because they saw a gap in the market and moved quickly to fill it. 

Indeed, the on-demand economy gives us all the opportunity to go after what we want, when we want it. That said, the only way we’re actually going to get what we want from a business perspective is if we can give customers what they want, and that might feel easier said than done these days. Trying to get the labor, supply and shipping stars to align perfectly so that you can execute your business model with precision is probably a pipe dream. 

There are three things that are totally within your control, however. Take these to ensure your business is built to pivot to new opportunities on demand.

A 3-Step Process for Thriving in the On-Demand Economy

  1. Ensure your systems give you a better sense of reality.
  2. Use predictive and/or prescriptive analytics.
  3. Simplify decision-making and actions.

More in Founders + Entrepreneurship3 Rules for Founders Who Want to Improve Their Fundraising Efforts

 

1. Ensure Your Systems Give You a Better Sense of Reality

If you don’t know what’s actually happening in your business or supply chain — meaning you only know what’s supposed to happen — then you’re at a disadvantage.

For example, you may assume that your entire fleet of mobile computers is online, fully charged and up-to-date with security protocols because no one has submitted a help desk ticket complaining about an issue. It’s very possible, though, that your entire fleet is down, and you have no clue. Employees may just be finding manual workarounds, or hackers might be in your system. You must be able to remotely monitor all devices and you should replace periodic health checks with around-the-clock device performance feeds back to a central, web-based dashboard. That way, you’ll always know exactly what’s happening on the ground.

Likewise, if your business is supply-chain-dependent, you should receive an alert the moment a discrepancy arises between ordered versus shipped units or shipped versus received units. Or if you run a delivery or transportation service, you must know the moment your drivers disconnect from your booking system. If they can’t receive directions on where to go next, customers could be left waiting for hours, and they may decide to drop your service altogether. 

 

2. Use Predictive and/or Prescriptive Analytics 

Knowing what will happen in the market and how it will affect your business (predictive analytics) is one thing, but knowing what to do when something out of the ordinary happens (prescriptive analytics) is quite another.

Predictive analytics might be helpful if you’re a business planner, perhaps responsible for procurement, labor scheduling or even shipping strategies. Some newer AI and machine learning-based platforms enable you to both predict and shape demand so that meeting demand with your available supply becomes easier, even if the historical first-party data that you’ve typically used for forecasting in the past is no longer viable because of the extreme changes in consumer and supplier behavior caused by the pandemic. These types of predictive analytics solutions are typically used by retailers, consumer packaged goods (CPG) companies and others charged with supply chain fulfillment. 

Depending on your industry, however, you will likely find prescriptive analytics most beneficial in managing the chaos of the on-demand economy as it tells you and your team what to do to avoid or correct an issue the moment that issue comes to light. This method is both proactive and reactive in the sense that it can tell you that you haven’t sold any milk in the last three hours, so you better send someone to ensure the dairy case is stocked or that inventory has been properly rotated so you don’t go another three hours without selling milk.

Both predictive and prescriptive analytics applications are available for healthcare, hospitality, and even utilities and government agencies — pretty much any organization that either manages or relies on a supply chain to keep services up and running.

 

3. Simplify Decision-Making and Actions 

If you’re familiar with quantum theory, or even if you just paid attention in physics class, you may have heard that “by the very act of watching [something], the observer affects the observed reality.” Technically, then, completing steps one and two should be sufficient to affect change in your business reality.

The reality that I’ve observed, however, is that unless you act on what you’ve seen and learned in steps one and two, you’re going to find yourself experiencing déjà vu day after day. You must take definitive and timely action on the knowledge gained from the expanded operational visibility and intelligent analytics systems. So, equip your team and yourself with hardware and software that sends alerts when something is wrong and describes the specific steps that must be taken to correct course.

Then ensure those devices empower you and your team to follow through. If a worker’s device went offline 100 miles away, will your team know how to use their own mobile device to initiate the lockdown and locate protocol? Or will they know how to check the stockroom for more milk, dispose of expired milk or notify the replenishment team if more milk needs to be ordered from the supplier?

Remember, no business is immune to the effects of the on-demand economy. Everyone is now held to the same standards. Your entire operation must be able to self-optimize as outside market dynamics cause supply and demand levels to fluctuate. Unless you can sense and analyze what’s happening right now and confirm why it’s happening, you risk falling victim to preventable issues, such as missed sales or service calls. The same is true if you know something is happening but don’t have a way to stop it (or at least react to it quickly). 

It’s like a 911 call coming in and a dispatcher not being able to send any units to the scene because the agency didn’t schedule enough officers that day or too many calls came in at once. Telling the caller that they won’t be receiving help is not an option, just like telling a customer that you can’t deliver isn’t an option. You must be able to regroup and find a solution on the spot. 

If you can’t or you take too long to see the big picture, miss the little details, or simply decide to avoid disrupting what seems to be working well now, then you’re going to start to lose your competitive edge.

So, although a lot of stuff is out of your control right now and, yes, the on-demand economy may be shaking up your business strategy, there are moves you can make right now to make critical decisions and workflows so much simpler for both you and the teams on the front line of your business.

If you’d like to learn more about what you’ll need to effectively sense, analyze and act on influential events, this is a good place to start.

More in OperationsWant to Serve Your Customers Better? Give ’Em a Nudge.

 

The Takeaway

With the right technologies in place, you can sense what’s happening around you in real time, even if what’s happening is an anomaly. Once you have such extensive real-time insight, you have the means to analyze the potential impact on customer behavior or your business operations using a prescriptive or predictive analytics solution that’s capable of identifying patterns the human eye and brain would miss. From there, you have the benefit of a solid informational and technological foundation to instruct your team what actions they should take to either address or mitigate consequential issues. If that’s not a compelling vision for the future, I don’t know what is.

Hiring Now
VelocityEHS
Cloud • Greentech • Social Impact • Software • Consulting
SHARE