Entire economic sectors require a ‘rip & replace’ approach for future resilience.

Building on a strong foundation
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By Todd Feldman
Founder & President, The Rocket Factory
 
A friend of mine recently set out to replace the wood boards on his aging backyard deck. The deck was built prior to him owning the home.
 
As he started to pull out the boards, he realized that the entire foundation of the deck was built incorrectly with the wood support posts rotting directly in dirt since they were not set in concrete.
 
It wound up being a complete gut-job. What was supposed to take days took months.
 
The result: a well-built, beautiful outdoor entertainment space that should be able to last for many years to come.
 
The pandemic has left many of our largest economic sectors in a similar situation; exposed for the weakened foundation for which they are built.

Last Tuesday, Virginia Tourism Corp. president and CEO Rita McClenny requested state legislators allocate $50 million to help jumpstart Virginia’s travel and hospitality sector. 
 
On Monday, a story by economic correspondent Heather Long appeared in The Washington Post titled, “The economy isn’t going back to February 2020. Fundamental shifts have occurred.” 
 
She’s right; it’s not. But what’s the best way forward?
 
I commend folks like Rita McClenney and Virginia Restaurant, Lodging, and Travel Association president Eric Terry for navigating the challenges posed by the economic fallout from the COVID-19 pandemic.
 
I’m also empathetic to leaders who have had to endure their business sectors crumble under the weight of economic disruption.
 
We’ve conducted research and stakeholder interviews throughout the sector nationally for the past year. We’ve seen that disruption has been coming for some time – even pre-COVID. To understand this, you only have to look at disruptors that have popped up, such as Airbnb and others that have taken a bite out of hotel revenue which ultimately helps fund these entities and other destination marketing organizations.
 
Even with economic stimulus funding, travel and other industries will remain at risk without completely revisiting the business model they practice and how they deliver value to their respective audiences.
 
The first step is to understand that the role of industry leadership has changed. To serve their constituents, they must lead a path to a new and better way forward by taking the reins and reimagining their mission, vision, and values as an industry and then to tie that directly back to consumer behavior and employee satisfaction within each of these sectors.
 
To get to that requires careful planning and new business ecosystems to form around the challenges facing each sector. The way forward cannot be business as usual. 
 
I’ve had the opportunity to be at the forefront of new technology and economic models throughout my career. As a result, I’ve seen massive disruption occur, and new business models form.
 
The opportunity before us is to use the pandemic and resulting economic crisis as a new launch point. One where new revenue streams and business continuity models become invented to safeguard against future economic disruption.
 
The knowledge and know-how exist with the experts that run these industries. The hard part is letting go of well-worn business models for a more stable future. The facilitation of new thinking lives with enablers of innovation that exist to help unlock hidden potential.
 
The time is now for all of us to lean in and act as if our future depends on it. 
 
Because it does.

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