Business Trends You Must Face to Thrive
In every economy, business leaders need to adjust their strategies to what is going on and will be going on around them. You can usually see these trends and they will be good or bad depending on the industry you are in and how and if you respond. Companies need to prepare their offensive strategies coming out of the recession, regardless of how fast or slow that may be, the reality is that we eventually will have a good economy again.
The following are the trends that need to be on your radar for the next 3 to 5 years, and they are not meant to be in order of importance, as they will depend on your particular business.
Technology Will Continue to Change the Way You Do Business
You must look at the way you do business today and think about how technology might put you out of business or severely damage your market position. If you can imagine a computer someday doing what one of your employees does, today, I can guarantee you it is coming. Those low-skilled jobs that can be repetitive, have low customer interaction, and have low added value are going to go away. Do not fool yourself on the customer interaction side. If the customer was given the option to pay much less and not have personal interaction or to pay your price to have that personal interaction, what choice would they make? Would enough of them still choose you to justify continuing your path? The shift to scanning and e-mailing and virtual meetings with video conferencing are just the beginning.
Unemployment will Remain High for the Foreseeable Future
The high unemployment rate will continue to take a toll on our economy. Yes, there are local pockets where the rate is lower, but the general U.S. population will have trouble absorbing its displaced workers because of increasing population, improvements in technology, and continued globalization. People will be making different decisions on what they spend money on. In addition, there will be a wage paradox: the people who are now the sole wage earner where there used to be two will need to earn more, and if you don’t give them the wage increases they need, they will start to look elsewhere. So I expect big wage pressure over the next two years. People will be forced to move where they can find jobs and to find a lower cost of living. On the plus side, with a lot more people to choose from in the market. Companies need to hone their skills on how to choose employees so that they have more “A” players to boost productivity.
Get Used to the Virtual Employee
The new model is less and less office space. Professional services firms have been moving in this direction for the last several years. Many of their employees do not have an office. They have a place to get mail, a space to meet with clients, but their main workspaces are their homes. As the cost of space continues to rise in major cities, it can make more sense to allow your employees to be virtual. It can help you be much more competitive in the marketplace by lowering costs, and often employees are more productive because they do not waste a lot of time in traffic, and they can find better work/life balance. In addition, it helps widen your labor pool to include ideal candidates who would not ordinarily want to work for you because they want to stay in the city in which they live. If you move in this direction, there is a caution. There are many people who cannot work effectively in this type of work arrangement, so your employee selection process should include screening to determine if your incoming employees can operate in a virtual environment if that is how you would like them to work.
Entrepreneurs Will Rule
I know the Broward Economic Development Council and Beacon Council spend a lot of time trying to get new companies to move to our counties. There is nothing wrong with that, and we should continue to do so. However, our main efforts should continue to be nourishment of entrepreneurship. The UM Launch Pad is a fine example of how to do this. We need to find ways to bring investment, knowledge, and resources to up-and-coming companies. South Florida has been and will continue to be made up of companies with 20 employees or less. Our larger employers will be those companies that started here, that we helped develop from embryo stage and leap to large. According to a study by American City Business Journals Miami-Fort Lauderdale was second only to Portland as the hottest city for small businesses in the entire United States.
In summary, the trends above should not be looked at in isolation. You need to combine them and consider what they mean. For example, many people are finding it easier and not too costly to go into business for themselves and generate a $1 million+ business from home with just a computer. They get a virtual assistant, virtual bookkeeper, several virtual employees, create a great website, hire a company that acts as their call center, and within a very short period with a good strategy they can become a formidable competitor with little investment.