Future of Trade: Business in the time of a pandemic and why the formula for success will ultimately remain the same

Inspired by my experience with Ellidore and the outcomes of DMCC’s strategic, long-term planning

In the months leading up to the pandemic about a year ago, I was fortunate enough to travel from Central America to Europe, during which time I was introduced to a concierge business called Ellidore. As a lifestyle management company, I am still reminded of how it was able to deliver on its core services immaculately, and in spite of its niche target audience, has been able to develop a thriving business that focuses on saving its members time while providing a superior level of service and convenience. No matter which tier of consumer service you engage with, this is always a recipe for success. On too many occasions, I’ve engaged with companies that have made big promises and underdelivered, not only leaving the sour taste of having paid for something with little value, but also negative brand recall.

As we accelerate through 2021, there is a general longing for the events of the 2020 to become a thing of the past; and for the advent of a new year to somehow give us a clean slate and the opportunity to return to “normality”. No doubt, the effects of the pandemic have made a severe impact on the global economy, particularly in sectors such as tourism, aviation and hospitality, however within those industries, there were those who were able thrive in the face of adversity by transforming their existing model to one better suited to a world with lockdowns and social distancing. As an example, the Mandarin Oriental in the U.S diverted much of its marketing focus away from its usual international/long distance travellers and towards local residents looking for short-term pampering by pushing its ‘Staycation at M.O’, while opening its restaurants, spas and shops for online delivery within the local area.

While few businesses have been immune, it has been clear that customer-centric models with an outlook to integrate convenience-enhancing technology and or service have proven to be more resilient than others. As someone who’s been at the forefront of Dubai’s trade sector, it became apparent that while more emphasis has been placed on the practicality of digitisation and the importance of innovation, the fundamental mechanisms that make a business successful have and will ultimately remain the same. Arguably, the most disruptive part of the pandemic has been the overarching policies made by certain governments who have effectively made matters worse by disrupting both the economic and social environments in an attempt to protect the public, while inadvertently causing a slew of additional problems; the repercussions of which are far more likely to outlive the virus itself. While unrelated, I am reminded of another problem-solving exercise which occurred almost seventy years ago, from which there are perhaps, several lessons to be learned.

In the 1950’s, the World Health Organisation was alerted to a large outbreak of malaria wreaking havoc on the local population of Sarawak and as a solution had ordered an equally large measure of DDT to be spread in order to kill off the disease-carrying mosquitoes responsible. The plan was a success; until it wasn’t. In decimating the mosquito population, the operation accomplished its mission of decreasing the number of pests carrying the parasite from 35.6% to just 1.6% over a two-year period, however, it also had two other undesirable consequences that caused the situation to get much, much worse. Not only did the DDT impact the mosquitos, it also affected an indigenous parasitic wasp that culled a certain species of caterpillar that was subsequently allowed to flourish and eat through the thatched roofs of the villager’s houses, causing them to collapse. Meanwhile, the poisoned flies and mosquitoes were eaten by the geckos, which were subsequently eaten by cats, causing a deadly chain reaction that saw a dramatic increase in the number of rats, which promoted an outbreak of plague. As a solution, the Royal Air Force was brought in to carry out ‘Operation Cat Drop’ (this actually happened), which involved the airborne deployment of cats by crates into the ecosystem, which eventually returned balance and order to the community.

While there are several points to be taken from this anecdote, I want to concentrate on what I consider to be the two important ones. All decisions have consequences; some of which don’t stop where you’d like them and secondly, that some things are best left alone, even in the face of negative, short-term outcomes.  

Indisputably, the world is going through a challenging time, which includes a broad range of moving parts so intricate and complex, that there is clearly no universal solution that can preserve physical, mental and economic health simultaneously. As a result, governments around the world have been making the difficult decisions, to varying degrees of success that either favour health or economic preservation as a priority. Depending on where you get your news, you could either believe that there is a deadly, highly contagious virus sweeping the planet which indiscriminately affects people in varying degrees, regardless of race, age or health – alternatively you could also believe that COVID-19 is a mild respiratory disease, no more deadly than influenza, which has been hyped up by the media as part of a political and economic campaign to derail our global economies. While there simply aren’t enough hours in the day to start picking apart which one of these theories, if either are correct, I want to focus on some of the constants that are irrefutable and why they’ve been important for business continuity here in Dubai and particularly with DMCC.

Similarly, to the challenge faced by the WHO in Borneo, there is clearly a problem that needs attention, however, in applying lockdown laws, it is apparent that the solution is quickly becoming a problem in the form of mass unemployment and economic hardship. To put in context, the scale of the economic-stimulus responses as of May 2020 from countries such as Germany, Japan, France and the United Kingdom were approximately ten times larger than the ones previously issued during the 2008 financial crisis and in spite of these contingencies, the IMF estimates a global economic contraction of 4.4% in 2020; a giant leap from the 0.9% contraction seen in 2009. 

While I am not in a position to comment on the politics that surround the virus, it would seem that now would be an excellent time to evaluate what business models work, and how budding entrepreneurs could take advantage by launching value-first products or services. From my nineteen years of experience with DMCC, much of our success has come from being able to think dynamically and move with market demand, however, there has always been a fundamental list of business constants that have ensured the best possible outcomes, which effectively boil down to providing a high-level of customer service, remaining at the forefront of innovation and having the insight to identify new opportunities.

Irrefutably, there are certain fundamentals that can offer businesses a competitive advantage and in today’s fast paced markets, ensuring you are up to date with the latest technology and consumer trends, while understanding how it will impact your business is certainly one of them; the most visceral example being when Netflix approached Blockbuster with a proposal to buy them for $50 million, which was subsequently declined on the grounds of being a “very small niche business.” By 2010, Blockbuster was bankrupt and by July 2017, Netflix had over 100 million subscribers and a revenue of $8.8bn.

At DMCC, the concept of facilities such as our Tea and Coffee Centres are perfect examples of how we were able to identify international business processes with room for improvement, before getting into the details of providing a comprehensive solution that benefitted all stakeholders along the supply chain - in our case by providing globally accessible infrastructure and facilities to receive, hold, process, package and distribute an untied range of products at a competitive price. Having published our ‘Future of Trade’ Report at the end of last year, our team discovered several key findings that will likely have the greatest impact on how we as a global community trade, as well as the gaps in the markets that represent significant opportunities for the right leaders and teams. For anyone who is yet to read it, please download your free copy today.

While many will regard the era of COVID as one of hardship, restriction and economic convalescence, there are an increasing number who see its merits as a catalyst for driving innovative change. According to Deloitte Insights, global spending on digital transformation is projected to grow by 10.4% in 2020 to $1.3 trillion, while in other cases many businesses have been able to fast track their plans in light of demand. According to the same report, a mobile car cleaning and disinfection service scrapped its two-year national rollout plan and went national in just two weeks, thanks to the window of opportunity presented by what others would refer to as a crisis. In other cases, similarly to the example of the Mandarin Oriental, other businesses were able to utilise their assets to pivot with demand, including whiskey distilleries producing hand sanitizer and manufacturers of all types developing ventilators and or PPE equipment. In essence, assuming or hoping that the world will return to what we used to know is unlikely to be a safe strategy, whereas accepting that things will continue to evolve with at an ever-increasing pace is probably a far safer bet.

While 2020 highlighted a multitude of challenges we all face together as an international community, I’ve been proud of the leading role DMCC has played in supporting global supply chains, while inspiring more people to take the leap and follow through on their ambitions by establishing a business with us. Having surpassed 18,000 registered companies, while also being recognised as the Financial Times’ fDi’s Global Free Zone of the Year for a sixth consecutive time, the last year has reinforced our beliefs that by creating a nurturing business environment that truly supports its customers, while providing the technology and administrative support to accomplish almost anything remotely, we are now a global centre for a wide range of companies that understand there are always opportunities to improve our collective situation and ensure we can continue to thrive, no matter how many challenges there are to overcome. In summary, I’d like to end by borrowing a quote from His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai: “I believe that positive energy and optimism help us to take up any challenge in life and to succeed in even the most difficult tasks. I also believe that positive energy is contagious: we can transmit it to others.”