If business last year didn’t change fast enough for you, just wait to see how 2015 will evolve at an accelerating rate. Market forces and process innovations that have been driving change across industry verticals are snowballing, and the cumulative impact over time is gaining weight. In particular, three interconnected factors are going to be a big part of the key business stories for the coming year:
- Customer pressure for a more directly connected experience with the supplier
- Time pressure for shorter investment return horizons
- Adaptive pressure for more agile innovation
How will these factors manifest themselves? We see a couple of key trends that provide challenges and opportunities in any sector, whether IT, healthcare, financial services, retail or in other verticals. Pay particular attention if you think your business is immune: The landscape is littered with companies (Kodak most recently comes to mind) that once defined the marketplace, and then lost ground while the rest of the world changed around them, redefining their relevance.
Change is scary and it’s not easy, but innovation and change are what carry businesses forward and keeps them relevant. You can’t be so in love with your past and present that you impede your future. Innovation is not a light switch that you can flip. The challenge is that many organizations hand their supposedly breakthrough innovative ideas to the parts of their organization that have been doing it the same way for a long time. But of course, the part of the organization that maintains operations doesn’t typically want to embrace disruption, and especially not failure. So you need to protect the innovative ideas off to the side, even if it’s a tough decision. Microsoft’s Garage is a great example of how a legacy company established an idea incubator within the organization.
The Variable Workforce
There is an interesting shift already taking place and that is projected to increase over the decade, to a much higher proportion of temporary or variable staffing. By 2020, 40 percent of the total U.S. workforce is expected to be contract or contingent workers. That’s a big impact and offers a tremendous amount of flexibility, with a view to a shorter time horizon for ROI and having the agility to innovate for fast changes in market conditions. At the same time, there are new risks in motivating a more variable workforce, managing staffing contracts and maintaining control of strategic capabilities. The right partner will work closely with clients to determine the most effective model for staffing, much like our Managed Services and TrueBridge teams approach engagements.
Agility, Dis-intermediation & Constant Learning
As Uber has shown taxi companies, removing the inefficiencies is easier than ever and that lesson will be expanded into more verticals. This transformative approach creates more opportunities, more transactions in the landscape, while it also takes out the middleman. The sheer volume of disruption is demonstrable proof that change is faster than ever and that your horizon for reliable ROI forecasting is shrinking. That shortened lifecycle is why organizations must create greenfields for innovation and embrace the flexibility that variable workforces provide.
The above only skims the surface of the major trends impacting all businesses. For a deeper look at industry perspectives and what’s on the horizon for healthcare, IT, financial services and retail, I encourage you to take a look at our 2015 Outlook and check back here for commentary from our industry experts. I’ll also be going deeper into the topics of innovative change, the variable workforce and dis-intermediation in the coming weeks – and sharing thoughts on how to embrace constant learning (hint: having teenagers at home helps!).