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A new study has shown that more than three quarters of companies will have to fundamentally change their business models due to the Covid 19 pandemic and the subsequent economic impact. The unexpected outbreak of the pandemic had a significant impact on business resilience around the world. More than half of companies said they were facing challenges in meeting their debt needs.

The sudden emergence of the coronavirus crisis has caused companies around the world to adapt to the unpredictable economic and social environment of the past year. As a result, companies relied more heavily on digitization and organizational restructuring to survive the pandemic, leaving many of their pre-pandemic status dramatically behind.

Nevertheless, according to a new report from FTI Consulting, even more radical changes may be necessary in the coming period. Of more than 2,000 large companies in the G-20 countries surveyed, the researchers found that 78% of companies are now using artificial intelligence and analytics to monitor scenarios that affect risk and compliance. However, 78% of businesses are forced to fundamentally change their business models as a result of the COVID-19 pandemic and the economic impact it has made.

To illustrate why this might be so, companies reported that cybercrime was currently the number one negative impact on their revenue decline – something they were more exposed to than ever due to their hasty digitization during the pandemic. Around 11% said cyber attacks steal or compromise assets – before a major new competitor entered the market at 7% and trade restrictions at 6% – and 6% said leaked sensitive internal communications cost them.

Caroline Das-Monfrais, Senior Managing Director and Global Resilience Lead at FTI Consulting, said: “Covid-19 has destroyed prejudices about what a resilient company or economy looks like. From debt servicing to cyber threats, organizations have never faced so many problems. Crises happen instantly. If 2020 taught companies anything, those companies that invest in resilience are well placed to thrive when we show up on the other side. “

Companies also need to respond to the increased regulatory expectations they have come to know as a result of their dramatic changes. As a result of changing regulatory pressures, 43% of companies said they were adapting internally to build our competitive advantage, while 34% said they had invested in research and development to cope.

“If companies don’t change, seismic changes in the marketplace will do it for them,” said Kevin Hewitt, chairman, Europe, Middle East and Africa, FTI Consulting. “Longstanding assumptions will be challenged, and the answers will affect both employees and consumers. One such lesson will be to ensure that organizations are better prepared for future escalations and not go unnoticed. “

However, for many companies simply investing is easier said than done, and many have to reassess strategic measures such as mergers and acquisitions and the integrity of supply chains, which three quarters of respondents believe have been permanently disrupted. This shows that surveyed three out of ten companies in G-20 countries that are in need of restructuring or refinancing due to the effects of Covid-19. At the same time, according to the FTI, the unexpected outbreak of the pandemic had a significant impact on companies’ resilience. 60% of surveyed companies said they face challenges in meeting their debt needs, and companies have seen an average 10% decrease in sales and a 12% decrease in headcount.