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Lessons from Asia’s reopening

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Good morning.

A quartet of Asia’s most successful business leaders shared lessons from their post-pandemic reopening with members of the Fortune CEO Initiative yesterday. My takeaways:

1) Digital transformation is accelerating everywhere.

“During the pandemic, all the brick and mortars moved to online, and all of them turned to online sales, not as an option, but as a necessity…This pandemic enhanced people’s online shopping habit and expanded their options from clothing and electronics to daily necessities like food and groceries…….Every single brick and mortar store has become a forward warehouse or forward kitchen to fulfill and deliver online orders.”
–Alibaba CEO Daniel Zhang

“Customers are very ready to order on their mobile phones…double what it used to be. Mom and pop shops, hair salons, everybody is going for digitization.”
–Yum China CEO Joey Wat

“You see the acceleration of digitization happening tremendously, especially with SMEs. Southeast Asia is probably ten years behind China in digitization, but Covid accelerated everything.”
–Grab CEO Anthony Tan

2) Travel is suffering.

“In Japan, our e-commerce business is up 50%, our travel business is down 90%.”
–Rakuten CEO Hiroshi Mikitani

“Our business in transportation hubs…of course those businesses are still struggling to recover.”
–Wat

3) Cleanliness is the new differentiator.

“Companies with good credibility on health and safety and food safety are viewed more positively.”
–Wat

“Contactless deliveries, making sure there are partitions, masks…if you stand out as a brand of safety and hygiene–here is how you can differentiate.”
–Tan

4) Cash is over.

“Cash is almost gone for the vast majority of Chinese citizens….People are very, very cautious about cash exchanges.”
–Zhang

“People kind of hesitate to touch physical coins and bills, and the government will try to encourage people to use digital payment in stimulating consumption.”
–Mikitani

“Touching cash is considered dirty and it might actually spread the virus. In the Philippines we have made every ride only cashless. These are tough decisions, because cash is still king in Southeast Asia.”
–Tan

5) Workers’ buy-in and welfare are crucial.

“I made it mandatory for everyone to join our morning hallo and at the end of our day what I call our afternoon hallo… The other thing is I started to do a lecture to all the new people who are joining our company, 30 minutes every day…[In a virtual all-company meeting] people started to participate and get more engaged than when doing it physically.”
–Mikitani

“When Yum China made the decision about what to do back to January, we made a clear decision that whatever decision we do we need to look after our employees first, customers, our community and then our environment. All are important…Social responsibility matters a lot…For many companies, including our company, [the task] this year is to build a brand. It’s not about making money, but hopefully we can build a brand and help shareholders make money for the next 100 years.”
–Wat

More news below.

Alan Murray
@alansmurray

alan.murray@fortune.com

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