Five 2023 business challenges – and how tech can help you respond

We are in what some analysts are calling a polycrisis: the legacy of COVID-19, a war in Europe, high inflation, energy scarcity, tightening monetary policy, slow growth and global indebtedness. With the future looking so uncertain, how can businesses prepare to meet the challenges of 2023?

The Grant McGregor team considers what leading analysts are predicting for the near-term future and considers how best to respond to those challenges and prepare for success in 2023.

#1. Being a better business

PwC argues that “being profitable is necessary, but not sufficient, element of doing business in today’s world”. 

This might seem out of touch in a world where most of us are struggling to remain profitable, but PwC argues that the ensuing competitive advantage, investment and staffing benefits of being a better business will be an aid to profitability.

Lynne Baber, Sustainability Leader at PwC explains, “It means creating value for all parties with skin in the game. For example, creating value that helps employees to decide whether to work for the company; customers to decide if they want to buy from the company; or investors to decide if they want to – or continue to – allocate finance to the company.”

Investment into “sustainable” or “green” businesses is booming; the money flowing into sustainability-themed investment funds is growing rapidly. PwC cites a survey of investors in which 74% agreed that how a company manages ESG risks and opportunities is an important factor in investment decision making. However, they don’t always have the information they need. Only 20% said the info they currently get is good quality.

With regulations changing around how businesses report on environmental and sustainability issues, including around climate transition planning, there is an opportunity here for businesses to take a lead. An environmental and energy monitoring solution is vital if you’re serious about sustainability. You need to understand your own consumption if you are to have any chance of lowering it – or of demonstrating those improvements to customers, staff and investors.

A suitable solution may include IoT sensors on metering and heavy consumers of energy across your operations, as well as fleet management and equipment management monitoring. It will certainly include data storage and reporting tools – probably in the cloud for optimum energy efficiency and accessibility. Information can highlight areas of heavy consumption that might be ripe for optimisation. It will also show the results of your interventions. Armed with this information, you can demonstrate that your sustainability initiatives are delivering real value and that you are striving to be a better business.

#2. Marketing through difficult times

Supply chain disruption, inflation, consumer confidence and uncertainty make for big challenges for sales and marketing leaders. At the same time, consumer behaviour is changing – with the pandemic hastening the shift to digital and online and brand loyalty taking a hit.

More than half of consumers in a Gartner survey said it is less important to choose a well-known brand today than it was three years ago. But it isn’t all bad news for marketers – 52% of respondents to the Gartner survey reported a lift in brand commitment after a single meaningful experience with an unfamiliar brand.

To succeed in these conditions, marketers need to focus strongly on the brand experience throughout the entire customer journey, says Gartner, focusing on high-value personalisation and providing information and reassurance to customers throughout their experience.

With so much business moving online, joining up the online and real-world customer experiences of your brand is more important than ever. Investing in a truly omni-channel marketing and CRM solution will be pivotal. Data can drive personalisation online, but only if you are capturing the right information and serving it to the right people at the right time. Amazon introduced its recommendations in 1998 but more than 20 years later, how many of us have caught up?

Gartner recommends orchestrating interactions that provide specific forms of help across the full customer journey, including customer self-learning, direction and reassurance. By focusing on building brand value through experience, it says, CMOs can win brand commitment through a single meaningful experience on a digital or non-digital channel.

#3. Meeting the evolving cybersecurity threats

With so much business moving online, cyber security has to be a key business priority. The speed and sophistication of the cyber threat continues to accelerate. Experts continue to warn about increasing state-sponsored threats, particularly from Russian and Chinese groups. 

In particular, ransomware attacks have evolved to a double extortion model. Often hackers are stealing data before encryption, so that they can threaten to publish the data. Another emerging tactic is to destroy data in order to limit opportunities for the victim organisation to restore or decrypt their data. Both of these tactics are designed to create additional leverage to encourage ransom payment. 

At the same time, the exploitation of “zero day” vulnerabilities has also evolved. The time between discovery of a new zero day vulnerability and its widespread exploitation by cybercriminals has reduced. This makes an effective patching strategy vital – but also requires further action. 

Investing in some kind of SIEM tool and ensuring that your network is monitored by experienced specialists is moving from a “nice to have” to increasingly being a “need to have”. Creating this kind of resource internally is out of the realms of possibility for most organisations and not even on the radar of most small businesses. For businesses with digital IP, sensitive data or which operate in highly regulated industries, outsourcing to a trusted service partner is the best option. Local government might wish to partner with other local or regional bodies to create a centre of excellence from where all networks and activity can be efficiently monitored.

#4. Grappling with the skills gap

The digital skills gap is one of the factors that makes establishing internal cyber security monitoring operations so unfeasible and costly. While the issues in digital skills are well-documented (and global), there are widening skills gaps across our economy. 

The UK is no longer the attractive destination it once was. An economy in recession, stagnating wages, an increasing cost of living and the ramifications of the Brexit vote have combined to create skills shortages in many areas. A decade of underinvestment in education and skills has also taken its toll. 

Working with local educational establishments and investing in mentoring and apprenticeships can help over the long term. In the short-term, taking a lead on pay and skills investment will be one way to set your business apart but, given all the other constraints on profit, may not always be possible.

Being a better business and demonstrating sustainability can help to attract and retain talent, especially the younger generations for whom ESG and purpose are increasingly important when choosing an employer. 

Offering flexible working is another way to attract and retain talent. Not only do you open up a wider geography from which to recruit, you also open up opportunities to people who might not otherwise be able to enter (or return to) the workplace. Plus, research shows that it can boost job satisfaction and retention within your existing workforce. Forrester’s Workforce Survey 2022 revealed that two-thirds of Europeans expect to be allowed to work from home more often and employers who don’t allow this can expect protests and attrition. 

It suggests that, with soaring energy prices, even reluctant employers should seize the opportunity for reducing the heating and cooling costs of office spaces that result from work-anywhere policies (assuming you have the right energy efficiency monitoring and sensor-driven automated heating and lighting controls in place, of course). 

#5. Mitigating uncertainty by right-shoring supply chains

The pandemic lockdowns have illustrated just how interconnected our world has become – and the vulnerabilities and dependencies that have arisen as a result. With the cost of transportation rising as a result of fuel price hikes and with international tensions rising around the world, right-shoring (or friend-shoring) is increasingly meaning moving production and distribution closer to home. 

For some manufacturers, this might mean accelerating moves to “batch size one” models of production, where local sites serve local needs, perhaps leaning into 3D printing for parts manufacturing and supply. 

For most businesses, it means considering whether low cost is really the primary decision factor in choosing where your goods are made. As consumer concern about the climate crisis continues to heighten and greater transparency in reporting is required, offshoring carbon output to Chinese manufacturers will no longer be acceptable as a way to “lower” emissions – especially given the country’s lack of other environmental and water-quality checks and regulations.

For businesses in the UK, exporting and importing with our nearest neighbours is likely to continue to be difficult - with Britain and the EU still unable to find a solution that works for both sides. 

Automating paperwork as far as possible, repositioning marketing to focus on experience and brand in a way that justifies the price premium and creatively looking for new opportunities to serve markets at home might be the best way to mitigate uncertainty in the short term. 

What now?

If you’d like to discuss any of the solutions discussed in this article with our team, please reach out to our team. We can assist on a range of technology solutions, including audits and consultancy.

Call us: 0808 164 4142

Or message us.  

Elsewhere on our blog

Read other articles relating to these topics:

•    A review of 2022’s biggest tech stories

•    What does the war in Ukraine mean for your cyber security?

•    Is China the next cyber-security risk?

•    Building a greener business through technology

•    Do I Really Need to Change Tools and Software when Switching IT Suppliers?