To say the business world has seen incredible change in the past few years is an understatement. It isn’t stopping: we are in for more, and more rapid, evolution. Leaders are asking: do the emergent trends of 2023 impact us? And how do we engage with them and ensure our organizations remain pointed towards its true north?
Here we are, about half-way through 2023... We’re mid-course on all of this. It’s a good moment to assess if our decisions at the end of last year were the right ones. And to re-assess how those decisions happened and what we should learn before the next hot topics arise.
The Big 2023 Trends
In “The 5 Biggest Business Trends in 2023 Everyone Must Get Ready For Now,” Forbes’ contributor Bernard Marr writes:
Businesses have faced huge challenges and have undergone an incredible amount of change over the past few years, and this won’t slow down in 2023. Businesses will have to deal with the aftereffects of the global pandemic, Russia’s invasion of Ukraine, economic challenges, as well as an ever-faster development of technologies.
Marr makes his case that the following five trends will have the biggest impact on the day-to-day for organizations, as well as on their very approach to doing business.
1. Accelerated Digital Transformation. AI. IoT. VR. AR. 5G. They are coming at us fast and furious, and further, the lines between them are blurring as they become enmeshed in our daily lives. As leaders, we need to ensure we have the right technology to support key functions.
2. Inflation and Supply Chain Security. COVID threw a giant wrench into the supply chain works, and snarls didn’t stop there. Other factors, prominently the war in Ukraine, have contributed to intense volatility. Implementing protective measures is a must for organizations that are trying to combat shortages and rising costs.
3. Sustainability. As impactful as the pandemic was (and still is), climate change will wreak even greater havoc. Consumers are increasingly conscious of environmental footprint and want to support businesses that have strong processes around sustainability.
4. Immersive Customer Experience. Welcome to the metaverse. Did you plan to be here? More and more, consumers expect immersive and interactive experiences from the brands they follow, support, and with whom they do business (e.g. 3D environments like dressing rooms to see how clothes fit without having to try them on).
5. Talent. We all saw this coming…. The great resignation, quiet quitting, and other trends have culminated in a mass exodus from traditional workplaces. The pressure is on leadership to provide a highly desirable employment experience is greater than ever. AI, VR, and AR can only do so much; we still rely on distinctly human characteristics to satisfy and engage our end-users.
As we all know, trends come and go… and sometimes come back. Leaders face a tough set of questions within the context of each of these trends—and any others that press on our organizations. We need to ask and determine which risks to shore up against, what our company’s capacity is to get in front of the trend, and whether or not it should even be a top priority at all.
But beyond asking these questions, there are pieces that need to be in place for your leadership team to be able to engage in these discussions and get to the right answers at all. In the face of risk—with either a potential crisis or potentially wild gains on the line—let’s talk about how hot topics like the five above need to be approached.
How the Board and Executive Team Make Decisions… Together?
Let’s start at the highest-level piece that plagues many companies when facing decisions like these. And let’s clear something up right out of the gate: the board sets strategy, the senior leadership team focuses on implementation. Too often, decisions like these are made difficult because the board isn’t fulfilling their role! Either they are making decisions for the staff about what should be done about these hot topics, or they are expecting senior leaders to make decisions without having clearly established parameters on where the company is headed, how risk is managed, and the values and priorities that need to guide all decisions.
By the time issues are “trending”, there’s usually a good reason. Word has gotten out about implications that are already happening. Companies have already suffered losses, marketplace positions have shuffled unexpectedly, stocks shot up or plummeted, operations may be suddenly bottlenecked. By the time these topics are trending, it’s too late to get clear policies in place, establish healthy board-CEO accountability and communication, or start to build trust on your team.
But this is why the board and executive teams can be incredible teammates for their organization’s success, and end up making decisions together despite being in separate rooms with separate discussions. When a board truly does their job to direct the organization and protect the interests of the owners, the executive team already has so many questions answered. They can then take the ball down the field guided by the hard work the board has already done. And the board, having done their job, now makes sure they stick to their job and trust that the executive team is going to make the best possible operational decisions.
Trends, Trust, and Teamwork
Healthy boards and leadership teams are foundational to the work of assessing and evaluating trends. It simply cannot be done well if everyone, in their own unique role, isn’t contributing safely and meaningfully. When a team is working as it should, they can make effective decisions around trends (or any other issue) because:
- They trust each other. Building trust is the key to evaluating trends. Everyone knowing their role and the shared vision for the organization and being able to rely on that truth allows leaders to ask great questions, engage conversation, and make decisions without the baggage of distrust and skepticism. Trusting what happens in the room you aren’t in is fundamental to excellent governance.
- They focus on due diligence. Due diligence is necessary to mitigating risk and making excellent decisions. When everyone is secure in their role and free to assess trends from all angles, more and better work happens and due diligence isn’t lost in the weeds. When governance and management are intermingled, due diligence suffers.
- They aren’t afraid of conflict. These are high stake discussions—people should feel passionate about their opinions and safe to share them. When it comes to big emotions, big personalities can prevail. Making the space and taking the time to hear from everyone is difficult, but essential.
- They know their risk appetite. Board and teams should always be assessing their risk appetite—not all quarters or years are the same. Knowing what your organization can stomach is the best guide of these trends analyses. Trying to function in a way that doesn’t match your organizational risk capacity does not serve anyone well.
In 2023, companies are taking these big risks and making these big decisions with impressive results:
- Adidas is increasingly automating their supply chain to prevent disruption.
- Huawei, Nike, and Lego (among others) are committed to the UN’s Sustainable Development Goals.
- Shopify has re-thought meetings to support their talent.
- OpenAI has stormed the scene, and caused a scene, with their ChatGPT AI.
- The Gucci Garden in Florence allows for a full virtual tour, sharing the splendor.
But they didn’t make these decisions in 2023. These decisions were either accelerated or hindered by how they are assessing risk, the level of trust in the room (and out of it), and the clarity of the direction they are heading as a company. Time will tell if these decisions were marks of their health or not, but those on the inside will either feel the effects or reap the rewards eventually.
It Starts with Getting Healthy
There are no easy answers when it comes to implementing strategies, processes, and practices that address today’s most impactful trends. The best way to navigate this fluid terrain is to get healthy—organizationally—before the trend arises: does everyone understand their role? Does everyone trust each other? Is there a safe space to have the high stakes conversations necessary when facing decisions that may shift your business?
If the answer to any of these questions is “no” then it doesn’t matter what trend comes along—and they will just keep coming along—the organization will not be able to handle it in a strategic, thoughtful way. If the structures that support the people making decisions aren’t strong and well-defined, the decisions they produce won’t be either. Start with your organization health, and the rest will follow.
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