This year was supposed to have been more difficult. Inflation was expected to tank customer spending. A recession was imminent. You wouldn’t have been crazy to think supply chain issues might get between you and your toilet paper again.
With the job market and economy looking a bit better than predicted, some economic observers are beginning to embrace a “soft landing” narrative. The prospect that inflation might slowly be brought under control without sending the economy into recession means that business leaders don’t need to operate in total crisis mode.
But that doesn’t mean everything is smooth sailing, either. Here are some of the major challenges business leaders face today and how to begin tackling them.
1. Coexisting With Economic Uncertainty
While the economy isn’t as bad off as many had forecast, unpredictability has brought unexpected challenges. Consumer behavior isn’t consistent with economists’ projections. People just keep spending, even when the best forecasting tools say they shouldn’t be. When they do spend, they choose low prices over brand loyalty, making demand forecasting even more problematic.
Accordingly, leaders don’t know when to slash prices or raise them. Meanwhile, layoffs are rampant at companies like Spotify and Amazon, even as the healthcare, hospitality and retail sectors continue to suffer a labor shortage. In short, no one really knows what’s going on, and consumers may be losing trust in their favorite companies.
Businesses that thrive in the latter half of 2023 will be the ones that act cautiously yet flexibly. They’ll take cost-cutting seriously and adjust prices accordingly but not drastically. They’ll streamline their organizational structure, ideally while avoiding massive layoffs.
Perhaps most importantly, successful leadership teams will communicate clearly and transparently to employees and customers. The uphill battle for consumer trust will continue in the years to come. Justifying decision-making that may seem erratic will form a big part of every company’s survival strategy.
2. Managing Remote Work and Retaining Top Talent
Working from home is no longer the mess it was in 2020. But WFH and hybrid office arrangements continue to pose workplace challenges.
According to Forrester, 40% of companies will try to put an end to work-from-anywhere policies in 2023. The consulting giant believes the push toward AI surveillance of remote worker productivity will push over half of WFH employees to seek new employment this year.
These new company policies regarding remote and hybrid work will erode workers’ trust in their employers over time. And with ongoing turnover and issues with morale, employees’ perception of their companies’ matters more than ever.
Business leaders will need to find ways to keep employees happy or risk them leaving, as voluntary turnover continues unabated. Talent retention starts with, where possible, better pay and benefits. Improved company culture can also make a difference.
Leadership teams should survey employees to gauge employee engagement—or better yet, schedule one-on-one interviews to gather intel. They should look for more ways to keep employees motivated, particularly in the form of growth and learning opportunities.
3. Warding Off Security Threats
In 2022, the U.S. saw 1,802 data breaches, affecting 422 million individuals. Data breaches will continue to be a significant business concern, especially as remote work is likely to further complicate cybersecurity. Employees will work over less-secure connections or take equipment out of the office, exposing it to outside threats. Many will access sensitive work data from their phones, which are more vulnerable to hacking attempts.
AI will also pose increasing threats to cybersecurity, as hackers use generative AI to create sophisticated scams. But the disease could also be the medicine: AI and machine learning can alert businesses to irregularities like breach attempts.
Companies will need to upgrade their security protocols to avert cyberattacks. This includes everything from installing robust cybersecurity software to training employees on how to avoid phishing scams. They’ll need to invest in the right tools for the job and in educating workers with access to personally identifiable information.
Smart leaders will take cybersecurity extremely seriously and implement response plans before a crisis happens. They’ll observe stringent authentication protocols and carefully restrict employee access to sensitive data. They’ll know what steps to follow in the event of a breach and how to communicate about it to the public.
The unpredictability of the last three years has changed the behavior of employers, employees and customers alike. That’s why providing a greater sense of dependability and transparency is imperative for modern businesses.
Customers need to know that companies will provide consistent quality and value. Workers need to believe that their employers will nurture their growth. And everyone—customers, employees and employers—needs to trust that their data is safe from attack.
Businesses that flourish in the months and years to come will be those that offer a feeling of safety and stability. They’ll act in ways that let their employees and customers know they can be counted on, no matter what. And they’ll make a name for themselves by giving people in this uncertain time something to hold onto.
Source: John Hall
Membership is open to businesses and organizations interested in increasing visibility and brand awareness in Westchester County and surrounding areas.