When was the last year that couldn’t be described as a tough one? Well, it is unlikely that 2024 will offer a turning point.
The rise of artificial intelligence represents one of the most pressing challenges for both businesses and wider society. This evolving technology has the potential to be both a catalyst for and inhibitor of employment.
At the same time, complex geopolitics is having an impact on the economy. The ongoing conflict between Russia and Ukraine is contributing to sustained inflation, for example.
Everyone is struggling – and business leaders need to come up with strategies to keep both consumers and employees motivated and engaged.
AI and an open mind
According to Kruti Patel Goyal, chief executive at online fashion retailer Depop, it will be important for business leaders’ to develop their understanding of AI beyond “just an efficiency tool” and start to think about how it can enhance user experience in 2024.
Depop, she says, aims to use the technology to personalise its offerings. “We expect it to have a transformational effect on our marketplace over time. In future, it could help to reshape the buying and selling process,” she explains.
Iñaki Ereño, the chief executive at Bupa, has similar ambitions. In addition to leveraging AI to help with healthcare diagnostics, he says, upskilling staff across all areas of the business to use such technology is one of his top priorities. “Bupa recently hosted a global two-day hackathon programme, available to all 82,000 staff and designed to train as many people as possible around generative AI,” he notes.
John Ridding, the chief executive of the Financial Times, agrees that AI will represent many opportunities next year, but stresses the enduring importance of human oversight. Particularly pertinent within the media and content creation spaces, he points out, companies should be wary of the “rise and risk of deepfakes and AI hallucinations.” Ridding says the business implications of AI could be “profound”, but urges any developments to be handled carefully and to treat personal data with respect.
A pragmatic approach to pay rises
For Carl Davies, chief executive at Perry Ellis Europe, the clothing conglomerate which includes the likes of Penguin, Farah and Nike Swim, “the cost-of-living crisis will probably be the biggest hurdle” for most business decision-makers next year. “Everyone wants to be clear on what they are being paid,” he says, “but businesses have got to balance the need for pay-rises with their own operational costs and what they can afford.”
Davies does not dispute the difficulty of personal finances. However, he suggests that a “proportionate” approach is how business leaders might best square this circle. “I think you have to be pragmatic,” he says, “and look at your lowest earners first. You do a percentile increase for them, relative to their salary, and then you move up [through the more senior positions at the company].”
Ahmed Essam, Vodafone’s UK chief executive, echoes this view, adding that bosses could also explore “one-off payments” to help staff with the cost of living.
Knowing when to get political and when to keep quiet
Against the backdrop of multiple elections, wars, and the evolving sociology of the internet, 2024 will doubtlessly require companies to be agile and responsive. Davies says that they should be careful, though, to “only comment on issues which are relevant” to them.
Business leaders should be wary of political gestures, Davies argues, which may alienate a particular group of people. “Making sure your supply chain is OK [i.e. not using any illegal or immoral channels] is one thing, but customers don’t necessarily need their clothing brand commenting on Brexit,” he says.
When weighing up whether or not to address a live issue, Ereño says leaders should question what value they could genuinely offer to it. “At Bupa, our philosophy is to contribute expertise where we think we can make a difference, in the regions where we operate,” he explains. “We have significant health provision in Poland. When war broke out in Ukraine in February 2022, we mobilised our resources to support Ukrainian refugees crossing the border. To date, we have supported more than 217,000 Ukrainian refugees with over 388,000 medical treatments free of charge and we have also employed over 300 Ukrainian healthcare workers.”
Unlike a performative message on social media, Ereño notes, this sort of real-life action can actually help people, while also underscoring the breadth of Bupa’s knowledge. Similarly, at Vodafone, Essam points out the company’s policy of helping “customers affected by global emergencies through crediting calls and texts to the location of the event and providing free roaming for those customers situated there.”
Understanding the business case for ESG
Increasingly, Goyal says, consumers care about where and how they spend their money. She suggests that the trifecta of people, profit and planet must underpin any business leader’s strategy in 2024.
Goyal highlights that gen-Z consumers, in particular, are drawn to companies which have strong environmental, social and governance (ESG) credentials. According to her, there are “higher expectations on brands and businesses… A concrete ESG strategy is critical for businesses, but it has to represent a genuine commitment, not just an add-on to business as usual.”
Consumers want to see hard numbers to back up claims, Goyal warns, “and at Depop, we’ve identified a set of impact goals that we’re committed to revisiting and reporting on annually.”
While times may be tough, Ridding says, business leaders should not view cost pressures as an excuse to row back on ESG. “This is short-sighted,” he says. “ESG is not just the right thing to do, it’s also good for business and crucial for long-term social priorities.”
Indeed, as important as ESG is for attracting and retaining consumers, it is also a key factor in attracting and retaining talent. “On the social dimension of ESG,” Ridding says, “the FT has taken significant strides in recent years to champion diversity and equality as both a publisher and an employer. We have more to do, for sure. But I am proud of the progress we’ve made in steadily reducing our gender pay gap, for example, and building women’s representation in our leadership team – more than half of the FT’s global management group are women.”
People want to work for diverse organisations, where progression feels eminently possible. Ridding says companies and leaders who view diversity as an opportunity, rather than a distraction, are more likely to reap the benefits from a deeper and more varied talent pool.
The need for resilient and progressive leadership
Ultimately, business leaders have their work cut out for them in 2024. The difference between whether a company succeeds or fails, Davies predicts, will come down to whether it can “keep people happy. That’s both within the organisation and its clients or customers.”
Navigating the next 12 months will hinge on firms’ openness to feedback, a willingness to learn, and a healthy dose of self-awareness. Companies need to make calculated choices about when they should or should not make a statement – and be careful to stick to the subjects and spaces only relevant to them. Every cost and every decision, both in terms of time and money, should have its longer-term value scrutinised.
The next year is going to be difficult, but that doesn’t mean it will be impossible.
