Predictions of the future have to be taken with a large pinch of salt – especially when considering the impact of technology on business over the next 12 months. However, as someone who started her career as a historian, I know that if we do not think hard about the future now, then we will inevitably be further behind the curve as business evolves in the months to come.
The past year has given us a lot of examples of the direction we are heading in and while the specifics of what I think will happen in 2016 may be wrong, the direction we are heading is clear.
1. 2016 will see more disruptive business giants emerge
There will be more major market disruptions – there will be at least one more Uber. I was interested to see that John Chambers, as he stepped down from Cisco, predicted 40% of companies “would not exist in a meaningful way in 10 years time.” Similarly, the CEO of JP Morgan Chase, Jamie Dimon, warned in his annual letter to shareholders that “Silicon Valley is coming”. What they are both talking about is digital disruption.
So what should you be doing to safeguard the future of your business? What I keep telling boards to do. Find some people who understand the changes in the market, sit down with them and START TO THINK THE UNTHINKABLE. Where might disruption come from – how could what you provide be delivered in a different way by competitors that you have not imagined? Look at where the smart money is going, talk to universities and entrepreneurs, talk to the young people in your company and take what you hear seriously.
2. Hackers will target more businesses
There will be another TalkTalk but this time it will affect millions. This will happen because:
- Companies are focused on their bottom line and the only way they can see to grow revenue is to take out cost. The result is that security gets sloppy.
- Hacking is becoming a real business. It’s not just terrorists, governments, or individual hackers, it’s people who have discovered you can create a business model based on smart hacking – l looked at this in an earlier blog. So what can you do?
3. Artificial intelligence will hit graduate recruitment
In 2016, a major accountancy firm will start to rethink its graduate recruitment. Typically they have taken on hundreds of graduates to do basic audit work. As this becomes more automated they will start to assess how many graduates they really need.
If you are an accountancy firm, make sure you are evaluating the software that is available. Automation will be giving your competitors an edge. Make sure you do not lose out. If you are a partner then you might want to look at your own future plans.
According to Wolters Kluwer, the top 50 firms have posted £11.9bn in fees in 2015, up 4.65% on last year, but they’ve achieved this with fewer partners – 5,700 in total across these firms, which is down 1.38% on 2014. The trend will only be downwards.
4. The rise of the global contractors
We will see an increasing move to a global contract labour market. One chairman of a UK company told me recently that they had a project that required 400 engineers for six months.
The assignment was short term and there were no follow-on jobs. They looked in the UK but ended up going to China because they offered that flexibility and were now easily accessible. And it’s not just engineers, start up companies such as mindsauce are turning to consultants online.
Look at how you can take advantage of this market. Will it allow you to access talent that is not available in your home market?
5. My last two predictions will certainly come true and that gives me no joy
The decline in jobs will continue. Politicians will continue to obsess about creating jobs that are not there to create.
And, educationalists will continue to educate children for a future that does not exist.
Sadly, few in positions of power have yet to comprehend or even grasp the potential impact of technology on individual businesses or the wider economy and these predictions reflect that.
How do you think technology will affect industries around the globe in 2016? Have I missed any critical developments?