The year 2022 has arrived, and most of us are cautiously optimistic as to how the rest of the year will unfold. Questions such as – when will the COVID-19 pandemic end? Will there be economic stagnation? What will the state of the economy be? How will the ongoing pandemic affect the larger business ecosystem? — has become commonplace in the last couple of years. Despite being faced with unknown unknowns, we at Zinnov, have drawn up and forecast some prominent trends that will shape this year and beyond. While no prediction is set in stone, we believe that there will be an unparalleled determination from leaders to create future-proof, sustainable, and antifragile businesses.
Enterprises will continue to display an obsessive focus on adopting modern digital technologies across industries, including federal institutions, small businesses, among others. Artificial Intelligence (AI), Machine Learning (ML), Cybersecurity, Blockchain, Intelligent Automation (IA), will be some of the digital technologies that will be top of mind for CXOs to bring in efficiencies, automate processes, and lower costs. Business resiliency and future/pandemic-proofing will be the way forward. In fact, a recent Zinnov survey revealed that almost 50% of enterprises indicate that they intend to increase their spending on digital technology adoption, implementation, and transformation to expedite revamping businesses holistically.
We are witnessing an increase in global MNCs directing investments toward India, Vietnam, and South East Asia to leverage the potential that these geographies hold. India ranks among the top geographies offering the highest return on investment (ROI) for Global Capability Centers (GCCs). Besides India, Vietnam and South East Asia are cost-competitive as well and boast vibrant ecosystems with high innovation zeal, multiple start-ups, large digitally skilled talent pools, industry and academia tie-ups, among other things. Global MNCs expanding their footprint in these locations will generate significant value in 2022 and beyond.
Factoring in climate change resilience into business strategy is no longer an option but an imperative. Businesses will need to change the spine of the existing carbon fuel economy. There are quite a few challenges in this path that are slowing affirmative action — the lack of a supportive ecosystem, limited infrastructure solutions, unavailability of investor capital, under-utilization of newer technological advancements, to name a few. It’s integral to change the collective leadership mindset to curb carbon emissions and spearhead sustainable business offerings from the top down. In fact, an immediate consequence of the pandemic-induced lockdowns and limited mobility was the decreasing levels of carbon dioxide emissions across the globe, to the tune of 2.3 Bn tons, after rising unabatedly for decades. At present, the goal is to take strategic leaps to achieve Net Zero by 2050. To helm the sustainability agenda, expediting innovation in technology and business models, will act as key enablers to this vision, including allocating institutional capital and risk-taking in terms of adoption and mindset change.
Most organizations based out of Japan and other neighboring countries are moving their manufacturing and supply chain bases out of China. The momentum is inclined toward building a ‘China plus one’ strategy, so that there is no dependence on one country for all supply chain-related aspects. In fact, the top 250 global MNCs are adding new operations in other developing Asian countries like India, Vietnam, Thailand, Bangladesh, and Malaysia, and are initiating new manufacturing opportunities. The primary reason for this mindset shift is the escalating trade wars, the changing geopolitical scenario, and de-risking supply chain and logistics end-to-end.
In this era of hyper-personalization, manufacturers face colossal challenges in meeting global customer demands. They are expected to incorporate more product customizations at affordable prices to ensure customer retention and brand loyalty. To cater to this evolving demand, manufacturers are leveraging AI robots to make factories more innovative, smarter, and intelligent.
The ongoing Talent wars, exacerbated by ‘The Great Resignation’ have come to a head, in the wake of the pandemic. There is cut-throat competition for the best talent. Most skilled prospects and employees are seeking stability and certainty, a great work-life balance, the opportunity to learn and grow, a clear and attractive career trajectory, among other things. To cater to these evolving talent needs and expectations, there has been a dramatic shift in the way companies attract, hire, and retain talent. Experimenting with new remote/hybrid models and incorporating innovative technological advances has become a critical focus to ensure a secure and collaborative work environment, rethinking conventional engagement models.
Technology disruptions have caused the Automotive industry to redefine its distribution, manufacturing, and post-sales models. With an increasing push towards electric vehicles, the big challenges still remain – improving Predictive Maintenance, Digital Fleet Management, Over-The-Air (OTA) upgrades, and Road Assistance. This shift in focus arises from changing product differentiation levers expected by customers, which has created a large skill and capability chasm for auto firms to build connected electric vehicles.
COVID-19 has increased sales of medicines and resulted in the exponential growth of the Pharmaceutical industry. With people limiting their movement and fulfilling shopping requirements online — the e-Commerce industry is enjoying immense success. Furthermore, with the trend of cashless services, like online banking, etc., Fintech companies are experiencing positive tailwinds with more start-ups emerging, global MNCs enhancing their capabilities, and lining up new product rollouts to compete with the new-age Fintech firms. In 2022, this momentum is expected to grow 10x stronger across all these verticals, with more developments expected to strengthen their importance to the economy.
Transformation across various aspects of an organization, has clearly become a priority, and will continue in 2022 and beyond. However, leaders don’t need to shoot in the dark for their strategies – they can use the above-mentioned business trends as a guiding force to channel their efforts – both capital and time. It will be an interesting year ahead, to say the least, with various moving parts in play across the global technology ecosystem.