Top 5 Challenges Business Leaders Will Face In 2022 and Beyond
Due to the constant changes of the past couple of years, many CEOs have stopped speculating over when the pandemic will subside and instead are focusing on operational shifts that will allow them to better cope with future surprises. Nonetheless, there are a couple of challenges that business leaders across the board think will face in 2022 and beyond.
The COVID-19 pandemic disrupted plans of numerous companies and forced businesses to take urgent measures.
Coping with market competition and driving your company’s revenue, requires you to prepare for business challenges ahead and understand how you can overcome them. 2020-21 taught us that to be competitive, we must be agile and able to respond quickly to changing market conditions. In 2022, you will want to look to drive digital business model innovation that focuses on speed, flexibility, and agility.
Business challenges faced by CEO in 2022 is different now that the pandemic is beginning to wane.
New variants will continue to emerge and may cause workplaces to temporarily go remote again. Hybrid work will create more unevenness around where, when, and how much different employees are working. Many employees will be greeted with real wage cuts as annual compensation increases fall behind inflation.
The pandemic-inflicted leadership challenges in 2020 and 2021 forced organizations to take extraordinary measures in real time, with zero planning.
Things changed drastically and dramatically, leaving no industry across the world unaffected. In 2022, it is time for business leaders to switch from a survival mode strategy and utilize the experience to prepare for the future. Here are some challenges that deserve your attention in 2022 and beyond.
In this blog, we’ll be exploring some of the issues that may face business leaders in 2022, and how best they can manage them.
Every business has faced a unique and unprecedented series of challenges in the last two years. In 2022, there will be more issues still to come. Here are some of the most pressing and an effort to help you navigate this journey into the unknown.
Challenge #1: Attracting & Retaining Top Talents
Across multiple industries, business leaders agree that one of their toughest challenges will be finding a way to hire—and retain—employees in this era of people changing jobs in large numbers. For some CEOs, this means placing an emphasis on re-recruiting existing employees and monitoring employee satisfaction.
The most common theme for a lot of businesses are the challenges with hiring, employee retention, the labor market.
More than 38 million Americans quit their jobs in 2021. In the wake of the Covid-19 pandemic, employees are reassessing what they want from work, and whether they can get it from their current employer. Employees want to be listened to… It’s not just surveying your employees, but also really taking their feedback, expressing to them that it’s heard and taking actionable steps based on their feedback.
Employers are offering significant compensation increases to attract and retain talent in today’s market.
Research has shown that in the U.S., year-to-date salary increases have been more than 4%, compared to a historical norm of 2%. But when we also consider inflation, real wages have declined. And if inflation continues to rise, employers will find the compensation they offer will be worth less and less in terms of purchasing power for employees. While some companies are able to compete for talent through compensation alone, others don’t have the financial resources to do so. Rather than trying to win the war for talent by increasing compensation, we are seeing some employers reduce the number of hours worked by employees and keeping compensation flat.
The number one challenge for many companies is that of recruiting and retaining talent.
Unfortunately, as you may notice the word “Top” has been omitted from the description as many are looking for almost any level of talent that they can find. All sectors seem to be affected, from restaurants to service firms to transportation companies. If there are no people to do work, companies are forced to throttle growth and look for automated solutions to overcome their challenges. In 2022, employers will need to review their hiring policies to ensure they’re finding those with high ceilings when it comes to their potential.
Hiring new talent has always been a lottery, and that won’t change.
However, as a consequence of these changes in the employment market, the penalties for hiring the wrong person could mean that you miss out on that one person that your organization craves. The global shortage of talent in the job market — now widely referred to as the Great Resignation — is posing challenges for organizations of all kinds, when looking to recruit top-tier talent. Revaluating your approach to recruitment, whether that be through more vigorous interviews, or skills tests must be a key point to address heading into 2022.
Challenge #2: Resurgence in Remote Working
The omicron surge complicated plans to return to in-person office settings for many businesses. At the height of the pandemic, many businesses around the world were forced adapt to a remote working schedule. Even though many organizations have now transitioned back to a phased or hybrid return to the office, the unknowns surrounding the Omicron variant has prompted a return to working from home.
When work becomes more geographically dispersed, managers have less insight into what work their employees are doing.
This leads to inaccurate and potentially biased performance ratings based upon where employees work rather than the impact they are having. A Gartner survey in the fall of 2020 of nearly 3,000 managers revealed that 64% of managers and executives believe in-office employees are higher performers than remote employees, and 76% believe in-office workers are more likely to be promoted.
That said, too many people were compelled to adapt hybrid work models, and many are finding it difficult to stay productive in such conditions.
Employees thus appear to find it difficult to maintain their previous levels of productivity. HR leaders who properly prepare for these HR challenges to overcome in 2022 will develop productive staff. Tracking productivity with staff management or monitoring software can assist improve quality and time management at work. Employees at all levels, from line workers to C-suite executives, will profit.
With the rise of personal technology, employees have been spending more time working from home or on mobile devices than in an office environment.
This means that they are not only working more hours but playing less, which can lead to stress and burnout. You need management strategies that make all employees feel like they can achieve work-life balance if they desire it, such as flexible scheduling and encouraging downtime outside of work. You need to be constantly learning and investigating new technology to incorporate it into your company. Be open to change and willing to experiment. This means embracing digital transformation, which is the process of integrating digital technologies into all aspects of your business. This will allow your company to keep up with the latest trends and standards without struggling.
Leaders must ensure that their employees are once again set up for remote working.
Employers are likely to want to continue making the most of the advantages of this working format, which will mean that leadership figures will need to carefully manage productivity and encourage continued communication. Yes, working from home or a hybrid option should be a permanent employee perk, given the resurgence of coronavirus cases. Covid-19 has delivered devastating losses, but one outcome that I hope lasts is the realization that the way we work has taken a toll on our bodies and family life. For so long, many employees have been pushing for flexibility in their work schedules. But for many companies and managers, there’s still a stigma attached to employees who want a work/life balance.
Challenge #3: Wellness is The New Wealth
Between the mental health challenges of remote work and handling the ongoing fallout of Covid-19, employees’ mental health continued to suffer in 2021. That’s why handling mental health issues and burnout will be a critical management trend for 2022. All of us are aware about the multiple findings that indicate employee mental health is worsening — triggered rates of depression, anxiety, stress and burnout as a result of the pandemic. This is creating problems at work and has prompted employers to take action.
Employers should strategically align their leaders, culture initiatives, management practices, and resources to specifically support the mental health and well-being of their employees.
It’s tough to keep employees happy when change is happening quickly and has such high stakes. But without changes, your company won’t be able to compete with others who are innovating faster than you can catch up. You need to find ways to innovate while still maintaining some sense of stability and security for staff members who may not want any part in change but need to come along anyway.
Employee health is a priority. Create clear channels where employees can raise concerns and health issues.
Stay up to date with emerging issues. Allow flexible working hours to allow employees to attend to personal issues. Encourage employees to keep strict working hours to avoid the common burnout issue. Find out what you can provide for employee mental health support. Offer regular updates on how your company is dealing with the latest Covid-19 news. Encourage employees to take advantage of health perks in their work packages. Wellness programs have been proven to result in a more productive workforce along with a reduction in sickness-related expenses and accidents. Wellness is a vital aspect of building a happier more health literate workplace and employees are increasingly planning to prioritize well-being support when they look for their next job.
The pandemic has highlighted that our physical and mental wellbeing are of vital and equal importance, and must be closely safeguarded so that we, and our communities, can thrive.
A 2021 piece of research by Deloitte highlighted the importance of integrating wellbeing into work design to enhance employees’ wellbeing while they work. With 80% of responders to Deloitte’s 2020 Global Human Capital Trends study selecting wellbeing as important or very important to the success of their organization, we know that organizations who make wellbeing a priority in the workplace are best positioned for employees to perform at their best, achieve their full potential and drive business success.
One area that is often overlooked when it comes to workplace wellbeing is the design of the office itself.
Employees need to feel calm and comfortable in their workspace and a quality workspace design makes for a less stressful and more productive environment. Moving away from a strict floor plan whereby everyone has an assigned desk and creating designated quiet zones, breakout rooms, collaborative zones and communal areas ensures everyone has somewhere to go to work effectively without feeling like they’re imposing on their teammates. Plus, we all understand the importance of taking screen breaks throughout the day, and providing quick and convenient access to coffee, water and other refreshments is a great way of ensuring your team makes room for a bit of downtime and stay hydrated till home time.
Challenge #4: Managing Supply Chain Issues
One of the biggest decisions that you will have to make as an organization in 2022, is going to be around investments, changes or modifications that you will need to make to your overall distribution strategy in relation to the global supply chain challenges that are happening around the world.
Small and large businesses alike are starting to be impacted by supply chain issues.
The pandemic shut down factories, created upstream bottlenecks, and consumer goods are just starting to feel the brunt of the issues. Anything from a chip shortage reducing the production of Ford automobiles to raw material shortages affecting the production of building supplies. This is being compounded by the fact that labor shortages are limiting the ability to unload shipping containers and transport items to the consumer. If businesses don’t find ways to get their product, growth could be severely impacted in 2022.
The worldwide interdependence of the supply chain was illustrated during the pandemic and has become a top challenge for businesses.
Supply chain disruptions have negatively impacted growth due to strong demand coupled with COVID-related supply disruptions. When people were stuck at home, they slowed spending on discretionary items, such as restaurants, entertainment, and other services, and more money was spent on food and consumer goods. As companies move from efficient to resilient supply chains, this will depress growth over time. While de-globalization has been occurring for several years, the pandemic increased the speed. Nations are setting up industrial policies to protect the supply chains of companies headquartered in their domain, and policies are meant to ensure that key inputs, such as semiconductor chips or rare earth metals, for example, are not being held hostage by the nations that control those inputs. These policies are accelerating the trend for Western companies to re-shore and diversify their supply base. Diversification won’t occur overnight, and China has the greatest advantage in terms of infrastructure, skilled labor base and manufacturing know-how.
The Covid-19 pandemic is not just a short-term crisis. It has long-lasting implications for how people work and how supply chains function.
There is a pressing need for businesses to build long-term resilience in their value chains for managing future challenges. This requires holistic approaches to manage the supply chain. Companies must build in sufficient flexibility to protect against future disruptions. They should also consider developing a robust framework that includes a responsive and resilient risk management operations capability. That capability should be technology-led, leveraging platforms that support applied analytics, artificial intelligence and machine learning. It should also ensure end-to-end transparency across the supply chain. In the long-term, risk response will need to become an integral part of business-as-usual protocols.
Business has to be resilient and capable of adapting to major disruptions so that it can develop long-term strategies and solutions to these complex challenges.
Though supply chains have continued to adapt and improve since the start of the global pandemic, challenges remain that will require practically all companies to abandon prior “best practices” and focus on the kind of transformation that our new environment demands. Organizations are learning that we must build in the flexibility and additional capabilities to not only manage the ebb and flow of today’s crisis, but also to prepare for a sustainable future. Coming out of this crisis, the strongest companies will have implemented state-of-the-art supply chain management practices powerful enough to mitigate a broad array of risks and perform under any market conditions.
Challenge #5: Tackling Workplace Inequality
Many CEOs feel that their company cultures are not inclusive enough, leading to a lack of diversity and hurting the bottom line. You need to find ways to make everyone feel welcome, from different ethnicities and religions to those with different sexual orientations and gender identities. This can be done by creating an open dialogue about inclusivity and having policies that reflect these values.
In 2022, executives will need to address how they are managing fairness and equity across the increasingly varied employee experience.
As per a study conducted by Deloitte, 80% of employees want inclusive companies, and almost half of respondents believed that their company needed to improve diversity, race and gender equality. This tells us that every industry leader must strive to familiarize themselves with diversity-related issues in order to create a truly inclusionary working environment. As we can see, these issues are now at the top of the agenda — both internally and externally — so we can expect to see leaders working towards a more inclusive working environment in 2022.
Despite offering countless benefits, fostering diversity and inclusion in the workplace do come with a handful of challenges.
People from minority groups could feel like they are treated unfairly compared to the major groups. Similarly, they might also think the manager is nicer to people with the same background. Consequently, these groups would barely raise their voice when encountering problems. For instance, employees from some Asian countries may not feel comfortable voicing their opinions, particularly when they are new to the job, or are in junior roles. This situation requires a sensible manager with strong leadership, EQ and communication skills to manage a diverse team, make every member feels included, and align the team’s decisions with the business’ goals.
According to a Glassdoor survey, two thirds of job hunters indicated that diversity was important to them when evaluating companies and job offers.
In a competitive global job market, demonstrating that your business is invested in fostering a multicultural and inclusive environment can make you stand out to the right candidates. Making diversity an important part of the recruiting process will broaden your talent pool of prospective employees. Not only does hiring from a more diverse talent pool makes your business attractive to ambitious, globally minded candidates, it also helps you to keep them on board. Diversity, including diversity of gender, religion, and ethnicity, has been shown to improve retention and reduce the costs associated with employee turnover.
In a diverse workplace, employees are more likely remain loyal when they feel respected and valued for their unique contribution.
This, in turn, fosters mutual respect among colleagues who also value the diverse culture, perspectives, and experiences of their team members. An inclusive atmosphere of cross-cultural cooperation is an excellent way to bond colleagues and teams across the business. Working across cultures can be a truly enriching experiencing, allowing others to learn about perspectives and traditions from around the world. Bonding over similarities and differences can help you to become a global citizen, abandoning prejudices or an ethnocentric world view–something that is increasingly valuable.
Now you know which structural shifts are most important, how those shifts might play out, what steps business leaders can take to inflect the direction and pace of change, and how the Covid-19 crisis has shifted the dynamics of power and influence across your industry.
We’ve all been living through the greatest workplace disruption in generations and the pace will not slow down.
What will change is how variable that disruption becomes. In 2022, leaders will need to learn how to thrive in a period of disruption that plays out unevenly across their organizations. The pandemic has created a significant change in the economy and companies are working to adjust their strategy to continue to grow. While most of these challenges look to make changes in the workplace to give employees a greater degree of freedom, improve culture and foster a healthy atmosphere, it’s up to leaders within an organization to see these changes through and adapt quickly when necessary.
While challenges abound, they have also brought forward some great opportunities.
If an organization is to continue to be productive and maintain a strong core of employees, any great leader must adopt a man-management approach to ensure that each employee is treated in a way that they respond to. Any organization that can produce an effective plan to address these challenges will continue to be productive and diverse in 2022, which means that everyone from board level to employees can reap the enormous benefits of a culture of continuous improvement.
By modernizing and revitalizing business processes at every level, leaders can navigate through the uncertain whirlwind of the pandemic and step into a new era of growth and success in 2022 and beyond.
The article has explored different strategies that can be used for each challenge and how they may affect your company. We hope you found this post helpful! Feel free to share your thoughts in the comments below!
Digital Dandy. Hacker From Heart. Workaholic. Coding Artist. Self-made.