Main Challenges in a Post Covid world

Shortages of computer chips, medical gear and more have the US grappling for solutions. Post pandemic, even companies are wrestling new challenges. How do we ensure that we are effectively dealing with the post Covid challenges as a company or as a country?

We need to necessarily look at 3 aspects.

Last month, President Joe Biden signed an executive order to boost manufacturing jobs by strengthening US supply chains for advanced batteries, pharma, critical minerals and semiconductors.

Is this enough?

We believe there are 3 Main challenges post pandemic:

1. Digitization: Technology can create dispersion forces, so that more economic activity can be coordinated at a distance. Also, technology can be labor saving since tasks can be automated.
2. Supply Chain: Companies and countries need to quickly adjust to disruptions in flow of goods and come up with a plan to increase supply chain resilience. This can happen in 3 ways:
   1. Consolidation: Keep suppliers close to production bases (Eg. Source inputs locally)
   2. Diversification: Finding multiple sources of inputs, either domestically or in new countries
   3. Reshoring: Returning economic activity back to home base
3. Human Capital – Skill development: Unfortunately the technological development has outpaced the upgrading of skill development. Ability of workers to respond to signals from the market about which skills are more valued will largely depend on access to skill development system.

Unless a holistic system review of all 3 challenges is carried out by country, it will lead only to local optimization.