High inflation is far from the help businesses need after a tumultuous few years of adapting to the COVID-19 pandemic, regardless of where around the world they’re based. Inflationary pressures are bad everywhere, but particularly biting in the UK, with the OECD predicting the UK economy will perform worse than all the other G20 nations, except Russia.
The pan-European Autumn 2022 European CFO Survey from Deloitte also found expansion and growth plans businesses devised as they emerged from the worst of COVID-19 have been swapped out for defensive strategies. These plans aim to combat rising energy costs, labor shortages, and the effects of inflation.
Amid this doom and gloom, individual businesses, from the smallest to the very largest, can feel they have an uphill struggle to survive, and they’ll be exploring every avenue to help them stay afloat. Technology can’t provide all the answers, and just how it might help depends on the nature of the business using it as well as the bigger picture of technology use. Harnessed wisely, however, technology might be able to provide a helping hand.
Stepping up digital transformation
COVID-19 forced organizations to undergo digital transformation faster than they might have planned. The need to support remote working, and a subsequent desire to capitalize on the benefits for employees, pushed digital transformation higher up the agenda. Today the same imperative exists for businesses, although largely framed by a cost-cutting agenda than a workforce-enabling push.
Pushing ahead with digital transformation – despite imperatives to cut back on IT projects – could be a great strategy, providing the funds to do so are still available. Depending on the nature of the organization, there are a number of projects that may help the organization be more productive in the medium or long term and therefore mitigate a potential revenue drop-off. Such projects include migrating to the cloud, eliminating data siloes, streamlining processes, developing or switching to services that use automation or artificial intelligence (AI) as well as honing marketing, sales, and customer experience (CX) activity.
Organizations might reap any one of these benefits be speeding up efforts:
- Work can be done more quickly and easily – including remote and hybrid work
- Customers and suppliers can enjoy faster, higher-quality communications
- Inventory, sales, and purchasing processes can become more reliable and effective
- Compliance can be managed more easily.
Meanwhile, from an operational perspective, moving to the cloud from on-premise systems can reduce space requirements, hardware costs, and the cost of energy required to run on-premise systems. Doing so can also pave the way for scalability and a development cycle that’s iterative and able to take advantage of new applications and services at speed.
Overhaul supply chain management
Organizations reliant on supply chains for components used in manufacturing, inventory for sales, or, indeed, as a supplier into the chain, need not be told about recent volatility that’s led to the non-availability of items and vast price fluctuations.
Technology solutions can help organizations keep track of what they need to buy, when, and from whom. They can monitor pricing, keep up-to-date information about alternative suppliers and pricing fluctuations, and help build relationships with the widest possible network of suppliers.
More complex supply chain management required by some manufacturing organizations can stand to benefit most from more advanced technologies. Applications, such as those using AI and machine learning can also optimize complex supply chains by alerting humans where issues might arise and by forecasting demand. Research by IBM found 53% of Chief Supply Chain Officers (CSCOs) say digital supply chain transformation initiatives could be their most significant competitive advantage over the next three years.
Offering a first-class web experience
Whether customers are members of the public, or other businesses, it’s important to give them the best website experience possible. Consumers often vote with their feet, ditching sellers whose web offer they find clunky and outdated, and the same is true for clients and partners. This is why the role of chief experience officer (CXO) is growing.
Those selling to other organizations aren’t exempt from the need to make sure they deliver a high-end experience via their websites. Looking at business-to-business sales, McKinsey found customer loyalty is hard-won. For example, 72% will actively look for another supplier if there isn’t real-time, always-on customer service, or if there isn’t a consistent experience across the channel. Meanwhile, 74% will do this if product availability isn’t shown online.
What this shows is that price isn’t everything when it comes to making sales. Using technology to deliver a high-quality all-round experience matters more to customers than simply dropping prices. Even today, with inflation continuing to be problematic, customer loyalty isn’t won on price alone.
Implementing the tools to fight inflation
In these specific areas and others, the constantly evolving march of technology can provide organizations with some useful tools to fight the cost of living crisis and inflation.
When cash is tight, it isn’t possible to invest in everything all at once, and, just as when the finances are flowing freely, it’s important to evaluate the options, select what seems to be the most appropriate, deliver the greatest reward for the least outlay, and make the move to implement.
