2022 can be a very positive year, but visibility of the near future is still murky. Businesses right now have a difficult task forecasting or predicting what is going to come next and this makes it very difficult to plan and prepare. The current level of uncertainty, therefore, is too high for comfort for any business strategist worth his salt.

I think there are three likely factors which this year can have a huge impact on businesses and the economy in general, namely inflation, the post-pandemic response and the new project economy.

1. Inflation

We have all seen the price of raw materials, energy and logistics, skyrocket upwards. The result has been inflation rates that we haven’t seen for circa 40+ years. The problem is that companies have a tough choice to make this year: do they absorb the increase in prices on the assumption that this is a temporary situation which will normalise later this year or should they pass on the increase in costs to the customer?

Managers either risk irking customers or their shareholders. I guess there is a third option but again this comes at a huge price. One could cut costs so as to keep both customers and shareholders happy but, in the long term, this is a bad idea since it destroys value.

My advice to businesses is to rethink the quality-price matrix of their products/services. My point is that inflation can be ‘hidden’ in rethought products/services with ‘new’ price models. I would strongly consider looking into ways in which my organisation can rethink business models and price models.

2. Post-pandemic response

As much as I would like to think that ‘clever people’ are taking post-pandemic decisions for the good of our economy and that they understand that lockdowns don’t work (or they come at too high a social and economic price) and that we really need to learn to live with the virus, I sometimes fear that Dr Fear will make an ugly comeback next winter. However, being the optimist that I am, my bet is on a post-pandemic response that is pro-economy and pro-business and that we will genuinely learn to live with the virus.

My point is that investors, employers and management need to be certain that this whole pandemic saga is really behind us and we will not go back to public health restrictions, workplace discrimination and U-turn type of decision making. As I have explained before, businesses need certainty for business confidence to be restored. 

My advice to managers and business owners is to assume that the pandemic is behind us and to focus on growth. I do so not because I am Nostradamus but because I’d rather be one of the first to invest and grow than risk being left behind. It is a calculated risk admittedly, but I would bet on growth.

I think we have learnt that pursuing a zero COVID strategy is a fallacy, that our pandemic response in general was akin to Ebola (which is much more severe than COVID-19) and this was a huge misjudgement and that natural immunity is as important to vaccine immunity in the quest to a population achieving herd immunity.

Therefore, I think it is relatively safe to assume that we will not go back to the dark years of 2020/2021 and that the country will learn to live with the virus. So go ahead and invest, recruit and grow your business.

3. The new project economy

I think the biggest change post-pandemic will be the change from ‘operations management’ to ‘project management’. This is having − and will continue to do so in an accelerating fashion − a huge impact on how we structure and manage organisations. In fact, the Project Management Institute has estimated that the value of project-orientated economic activity worldwide will almost double to $20 trillion in 2027.

This trend will have a major impact on how we structure organisations and how we define business management. Experts believe this will mean the end of job descriptions and jobs as we knew them pre-2019. The future of business management will be all about projects and project-based work. People will no longer be defined by the department they belong to but by the projects they work on. Therefore, project management skills will become key for people. 

The project economy will mean labour laws will need to be rethought, HR departments redefined and organisational structures radically reshaped. 

Conclusion

I think the business landscape will look very different post-pandemic. We will have new challenges/opportunities, new unknowns and unknown unknowns and a completely new way of creating value for customers, employers and owners.

What next? Agile organisations, uncertain contexts and project-based growth.