Innovate or else: The economy of the future requires disruption

Marcelo Claure shares the common thread he’s seen across the greatest success stories of the past year

The following has been excerpted from WeWork executive chairman and CEO of SoftBank Group International Marcelo Claure’s keynote address at the WeWork Innovation Summit. It has been edited for clarity. 

To watch his full remarks, click here.

It’s hard to believe we have passed the one-year mark of the world going into lockdown. It has been a difficult year to say the least. I am more confident than ever that with the acceleration of vaccination distribution, we’re on a path to clear recovery. We’re embarking on a new normal, and we’re seeing a glimpse every day of what that will look like.

In business, we often speak about disruption, and it’s fair to say that the global pandemic was the ultimate disrupter. It changed the way we live, play, and work

The way we live: social distancing, wearing masks, and staying at home rapidly became normal. Almost overnight, everything we did became virtual: fitness, meetings and, while hard to believe, even weddings.

The way we play: we went from going to bars and concerts and cheering our favourite teams at sport events to watching Netflix, Hulu, Disney+, and a lot of TikTok from our mobile phones. Our entertainment and social lives became digital.

The way we work: we went from going into an office Monday to Friday, five days a week, to working at our dining-room tables or desks at home. We had endless video chats with flatmates and families in the background. This pretty much eliminated the boundaries between our work lives and our personal lives and, at least for me, it made it very hard to find a balance.

Every sector was impacted as we shifted to a digital world. In the United States, e-commerce grew over 44 per cent in 2020. This is compared to just 15 per cent growth in the previous year. In healthcare, the percentage adoption of telehealth in the US skyrocketed from just 11 per cent of consumers in 2019 to 46 per cent of consumers by mid-2020. In education, 1.6 billion students all over the world were impacted when schools closed and they were forced to transition to online learning. 

Throughout this time, many of us around the world have suffered some unspeakable losses. We all know people who have been affected by COVID-19. But through all the hardship, we’ve also seen some incredible evolution and disruption. Companies across industries were pushed to the brink of extinction. They had to innovate or else. For the ones that seized the moment, the ones that pivoted, we saw a new kind of disruption. We saw a spark of creation that led to amazing development, accomplishments, and groundbreaking innovation that is improving the way we do everything in our lives.

The way we live: companies like DoorDash and Opendoor defined and redefined themselves during the pandemic. DoorDash is such an incredible story. It was started just seven years ago by Tony Xu and his university classmates at Stanford. Fast-forward to 2020, and the pandemic forced a stop to dining in restaurants. Every restaurant had to innovate, and DoorDash took advantage of this opportunity and tripled its deliveries from the year before. It didn’t stop there. It kept innovating and brought new services like local shops and supermarkets to its platform. In this moment of opportunity, DoorDash not only grew its business but it also grew its market share. DoorDash accounted for over 45 per cent of all US food deliveries in 2020. 

Through the pandemic, we saw urban dwellers flood to the suburbs, but how do you purchase a new home when leaving your current one is a safety hazard? Opendoor masterfully redefined the home-buying experience during the pandemic with virtual assessments and virtual tours. It successfully made the home-buying experience completely digital.

The way we play: when it comes to travel and leisure, Airbnb’s story has just been remarkable. As a company fuelled by travel and tourism, it struggled at the height of the pandemic. There were so many critics who doubted its ability to survive, but instead of waiting for the pandemic to subside, Airbnb adapted and innovated. It launched a brilliant campaign, Go Near, and started promoting local travel and making Airbnb experiences virtual. It allowed its hosts to offer music and cooking classes and many other virtual activities. It turned adversity into opportunity. 

The way we work: working from home at the beginning was great. It was so great to be with your family. It was so great not to have to commute to the office. But as we started doing it more, we realised it had a lot of limitations. 

Studies show now that after one or two days of working from home, we start to feel less engaged, we feel less empowered, and we feel less fulfilled. To put it simply, the energy you feel in the office surrounded by your team and the spontaneous collaboration possible there cannot be replicated on a video call. In fact, in a global blind study that WeWork recently conducted, 9 out of 10 of all respondents said they wanted to go back to the office at least once a week. Twenty per cent of that group said they wanted to return a full five days a week. 

Over the past year, WeWork took the time to understand our members. In another blind study conducted by Workplace Intelligence and WeWork, 64 per cent of employees in the United States surveyed said they were willing to pay out of their own pocket for a workspace of their choosing, even if their employer would not subsidise the cost. This demonstrates the eagerness to leave the work-from-home setup and go to an office to take a conference call or just to be in a quieter space. But more importantly, when we asked why, it’s because all those employees say they value space, they value collaboration, and they value connection.

This is not lost on executives across industries. Seventy-nine per cent of C-suite executives surveyed said that after the pandemic, they plan to let their employees split their time between corporate offices and remote working if their jobs allow for it, meaning that the way we work has forever changed.

What makes WeWork truly innovative is smart flexibility. Smart flexibility empowers you to choose whatever size space you need, whenever you need it, and wherever you need it, with no upfront capital expenditure and no added cost for office management.

After the threat of the pandemic subsides, or even during the pandemic, you’ll have the freedom to experiment and the freedom to grow your business on your own terms. You can determine what kind of workplace strategy works best for you and your teams in this unprecedented moment in history. Our study showed that employees who are more satisfied and engaged want to spend twice as much time in locations other than their home or old corporate office compared with their less engaged colleagues. What they’re saying is that they want a combination of hybrid workplace options. We all know that a more satisfied, engaged employee leads to building a more productive and successful business. Leaders today must ask themselves how to operationalise this new hybrid workplace. That’s where WeWork is really innovating.

WeWork now has ‘Access’ and ‘Dedicated Spaces’. WeWork All Access gives individuals, from the freelancer to the Fortune 100 employee, the ability to choose where they work and the ability to change this location at any time. Dedicated spaces are permanent or semi-permanent touchdown points, private or reserve offices that can range in size from one desk to a full floor to a full building. The beauty of Access and Dedicated Spaces is the ability to bundle and scale at a moment’s notice without having to sign new leases. 

For example, if you’re switching to a work-from-anywhere corporate policy, which a lot of businesses are doing now, the WeWork All Access membership will give your employees or your teams the ability to use hundreds of WeWork locations across the globe at any time. That means access to any of our hundreds of buildings all over the world at any time. WeWork On Demand lets them book a desk or a conference room for an hour at a time. 

If you need to adjust your headquarters, which used to accommodate 500 people, to accommodate just 225 because of social distancing, we can spread you out across floors faster than anyone else. Or perhaps your employees will work from home for individual tasks, but will come to the office for group projects. To solve that need, we’re partnering with companies to build what we’re calling collaboration hubs. These hubs are customer spaces that are designed specifically for teamwork. 

Maybe you’re a leader who doesn’t yet know what the best strategy for your company will be—that’s OK too. WeWork can help you figure this out by testing different models. We have the data and tools to help you monitor your employee usage, their estimated commute times, and the optimal locations to support their preferences. 

Innovation means empowering you with the flexibility of choice and the freedom to experiment in these unprecedented times. Smart flexibility has always been at the core of WeWork’s value proposition. However, the recent global pandemic has magnified that value more deliberately. Our job is to help you figure out your next steps today and, if need be, empower you to change tomorrow.

To watch Claure’s full remarks, click here.

Marcelo Claure is executive chairman at WeWork and chief executive officer at SoftBank Group International.

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