How Businesses Can Tackle Their Biggest Challenges Right Now

This year has been one that has had challenges on an individual, global, and also business level. There have been a number of situations following two years of the COVID-19 pandemic that are contributing to these challenges.

Challenges

Businesses that want to weather any potential storms that are occurring now or could in the near future have to understand the challenges they’re facing before they can create a plan to deal with them.

As it stands right now, the following are some of the biggest challenges businesses are dealing with and how generally they might prepare for these situations.

Cybersecurity

Modern organizations are seeing an expansion of their digital footprint outside of traditional confines and perimeters, which are driving many of their biggest cybersecurity challenges.

Forward-thinking organizations and businesses of all sizes will need to rethink their tech stack, which will allow them to address new threats. Cybersecurity decision-making will need to be business-driven, and businesses will have to think about how the changes in work environments are going to further make a centralized cybersecurity model obsolete.

Cloud-based business processes and hybrid work have introduced new opportunities but also new risks.

Some of the trends particularly affecting cybersecurity that need to be addressed include:

  • Possible attack surfaces are expanding. Many workers are still remote, and a portion of those are unlikely to ever return to the office. This combines with more use of the public cloud, creating new attack surfaces. Organizations need to look past their old ways of managing security monitoring, detection, and response to take into account a wider field of risks.
  • Identity systems are a major point of attack. Credential misuse is the main way attackers utilize access systems to meet their goals. Consolidated solutions to defend identity systems will be needed.
  • The digital supply chain risk is a threat emerging as one to prioritize. According to Gartner, by 2025, 45% of organizations from around the world will have experienced software supply chain attacks, which is up three times from 2021. To manage this risk, security leaders need to collaborate with other departments, prioritizing the risks of digital supply chains. There also needs to be scrutiny on suppliers to make sure they’re upholding best practices.

The Russia-Ukraine War

The Russia-Ukraine war is now going on for months. Companies in Europe but also globally are feeling the effects in multiple key ways.

Some of these impacts that are creating challenges for businesses include:

  • Food prices are going up. Food and raw materials prices were already going up prior to the Russian invasion of Ukraine, but since the invasion, the prices of things like wheat have gone up sharply. The rising prices of certain products are leading to negative business impacts when a company needs those items. Ukraine is a top wheat and grains supplier for example.
  • Gas prices are, of course, going to affect businesses from several angles. The oil market and other factors have led to high fuel prices, and that’s then impacting cash flow.
  • Since there are sanctions currently imposed on Russia, businesses have halted operations there.

Supply Chain Issues

Supply chain challenges have been going on since 2020 and potentially isn’t going to let up any time soon, at least not in any substantial way. Initially, the pandemic was the primary reason for supply chain issues. That is still the case in some places, particularly as China is grappling with its rising COVID-19 cases.

There are disruptions at ports in production facilities, and there are also weather factors impacting the supply chains.

When there are supply chain disruptions, it increases costs for all businesses and in, particularly smaller ones.

The goal for organizations of any size should be to build as much supply chain resilience as they can. That means being proactive in the identification of areas of risk.

You can begin by mapping your supply chain. For a larger business, you might use software that will help you identify suppliers and subcontractors. For smaller businesses, you may be able to produce this manually.

When you map your supply chain, you begin to understand the journey, and you can start to pinpoint where you can become more efficient and what you can do to create backup plans.

For every risk or obstacle identified in the supply chain, think about its impacts on you as a business and your customers.

The risks that are most serious to you are the ones to prioritize. You also have to look first at the things within your control, and from there, those things outside your control that you might be able to mitigate with effective contingency planning.

Your overall business strategy needs to take supply chain resilience into consideration at all times.

Recruiting Employees

No matter where you go over the past year, there have been obvious staffing shortages. Businesses are having a hard time filling positions at all levels. The Great Resignation, as it’s being called, is seeing employees leave their employers in droves. Many are either finding better-paying positions or perhaps doing something entirely different, like starting their own businesses.

The post-pandemic recovery in hiring is proving to be a major headwind for businesses.

There are an enormous amount of job openings, and simultaneously, qualified candidates are in high demand.

The economy was at the start of the year still around three million jobs short of the pre-pandemic levels, and there was around 4% unemployment with a low labour force participation rate.

The rise of both hybrid and remote work, which has become the norm at many companies, actually makes job-hopping easier than ever before, which isn’t making things better on the business side of things. Employees can apply, interview, and then work remotely, so there’s nothing that keeps them from constantly looking for the best new opportunity.

Employers have to understand what employees want for recruitment and also retention. Employees want flexibility, perhaps above all else. They also want competitive pay, but quality of life can rank as high as salary, if not more so for some workers.

Recruiters have to learn how to be in tune with what’s top-of-mind for job seekers.

Job ads, first of all, should detail the work environment and whether it’s fully remote. Recruiting messages also need to talk about work culture and flexibility. Recruiters need to start specifically highlighting the salary being offered if they want to be competitive in getting quality applicants.

The concept of the employer brand is also gaining a renewed focus. The spotlight is on making sure that companies are conveying effectively to would-be employees why they’re the best place to work.

Once employers secure employees, retention has to remain a top focus as well.

Recruiters need to make sure they’re delivering the experience they’re selling initially.

Consumer Pessimism

A lot of major situations that are affecting businesses negatively right now are also affecting consumers.

For example, inflation, gas prices, and the Ukraine war aren’t just shaping how businesses do things. They’re shaping how consumers spend or save money and how they view the economy on a larger level.

Consumer sentiment in the United States in March 2022 fell to 59.4, and it was an almost-11-year low.

The largest share of Americans since the middle of the 1940s also said they think their financial situation will get worse in the year ahead.

Overall, when it comes to the economy and the world at large, Americans don’t feel like they have much to be happy about.

Analysts say pessimism is primarily stemming from inflation, more so than anything else. The year-ahead inflation rate is expected to be 5.4%, which is the highest since November 1981. Americans are paying more for everything from cars to homes and rent.

The upside of what’s happening right now is that the labour market is healthy, and Americans can get jobs, but that fact may not be resonating as much as businesses would hope.

Unfortunately for businesses, there’s not much to be done about pessimism among consumers.

Businesses are actually reporting similar feelings. The Small Business Optimism Index did show a small uptick in April, but still, the expectations are low.

Other Challenges

Along with the major ones listed above, there are plenty of other issues concerning businesses of all sizes and across all industries.

For example, knowing how to collect and use data is becoming a priority. Businesses are collecting enormous amounts of data and have more available to them than ever before, but they’re struggling with how to use it in an actionable way.

That’s something businesses are going to have to simply train themselves to do.

Finally, changing regulations is a persistent challenge, particularly in certain industries. Technology-based tools are the best way to keep up with regulations and pivot when necessary.

Businesses are going to have to get smart about identifying their technology needs and then implementing them without major disruptions to operations. Pivoting isn’t always easy, particularly for small businesses, which is why automation and technology geared toward keeping them ahead of regulatory changes is their best bet.