The future for US companies will be marked by increasing consumer demands, temporary disruption of supply chains, difficulty in hiring and retaining employees, a retreat from inflation, acceleration in the use of technology, and a growing focus by companies in providing customers with a better experience to drive profit and prevent injury to brand identification.
These conclusions were expressed at a virtual September 22 program mounted by the National Association of Corporate Directors. While typically I do not spend time posting the pedigree of panelists, in this case the source of these conclusions is important, so: the panel included CEOs of Panera Bread (a food services holding company), Eastern Bank and Perkin Elmer (a major consumer-facing company, a rapidly expanding bank and a health care company doing business in 180 countries); Cathy Minehan, former CEO of the Boston Fed, presided.
There is a labor shortage which is long-term based on demographics. Today there are 11,000,000 US job openings and yet 8,000,000 unemployed (likely result of trauma and government stimulus). Companies will need to offer to employees more than money, but rather a clarity as to the value of the company mission and a discernible career path,
In the near term, consumer demand will be frustrated by supply chain impact on available products. Consumer-facing companies will need to embrace ESG, DEI and other issues bearing upon brand reputation; many factors will force consolidations in various business verticals. Further, customer needs must be met at a higher level in terms of healthy products, speed and ease of delivery, identification of company core values with those of the consumer (“consumers are a group of one”; “I want it for ME.”)
COVID has accelerated trends in AI, on-line commerce, need for efficiencies which are driving mergers as necessary to meet channel challenges and the expense of technology expense. (No one mentioned the increasing US government pressure on merger activity, for which see my recent post on that issue).
There are challenges with return to offices; some industries require people on site, some require only a fraction of people on site; professional offices are likely not to have full attendance. This latter question raises issues of how employers respond: those people who are not at home incur greater expenses, hassles in commuting, greater health risks, issues with child and elder care. How do employers compensate for this greater pressure on these workers, which pressure goes beyond number of hours “on the job”?
Finally, two panelists expressed confidence that the “new normal” would arrive some time in 2022; in a mildly contrary vein, the CEO of Perkin Elmer (the health care company perhaps best positioned to have this insight) said that you can never tell about things like that….