On FourWeekMBA one of the primary focuses is to dissect important trends happening in the business world, that have the potential to affect and reshape current industries.
Thus, as a business person, you might want to keep an eye on the following trends identified in 2021, and that will continue to affect the business world in 2022, plus additional trends identified as among the ones shaping the business world in 2020-2030.
Business Trends in 2022
2021 has been an interesting year. Many thought 2020 had been a tough one to pull out. And yet 2021 has been even more unpredictable than 2020. Politically, it started with the US Capitol riot, and it culminated with the explosion of inflation.
2021 was the further explosion of crypto, the further rise of Bit Tech, the great resignation, the rebranding of Facebook in Meta, and many other interesting stuff.
Let’s look at some of them.
New Business Models
Business Trends in 2021: COVID-19 and the process of forced digitalization
If you are familiar with the technology adoption curve model, you might know how technologies move from innovators down to late majority and laggards. It’s important to remark that the process of technology adoption it’s all but linear. Indeed, there are many “chasms” that technologies have to go through before getting to the point of mass adoptions and those are not guaranteed at all.
The Internet born decades ago, it became commercially viable by the end of the 1990s. Yet as the dot-com bubble of the early 2000s showed, many of the commercial use cases experimented through the initial stage of development of the web were not viable yet.
The companies that came out from that era became dominant players and what we now call tech giants. The combined capitalization of those tech giants has grown exponentially and now the web has come to a point where it was ready for mass adoption, where digitalization of one’s business isn’t an option anymore.
While this process of bringing digitalization to the late majority and laggards would have taken probably another decade, it was all accelerated in 2020, with the COVID-19 pandemic.
The pandemic forced the process of digitalization at the point where being online wasn’t an option anymore, it became the core business model for many companies. Many small businesses had to quickly adapt to this new reality and some of the trends that we saw strengthening at light speed were. At the consumer level some of the key trends were:
At the small business and enterprise level some other trends were:
That called for important business model changes for many.
Let’s see some of the consolidating trends from 2019, the ones that played a key role in 2020, and those that might in 2021.
Uberplatforms: The Platform 2.0
Businesses today aren’t structured to work in teams.Yes, there’s business to business, B2B. But even in a B2B transaction, you’re still responsible. Like if you’re in a B2B lending network, and you’re depending on a third party to vet the authenticity of a particular client that you’re lending money to, and they turn out to be a bad actor and the government comes after you for lending money to a bad actor, you can’t say, “Oops, it wasn’t me. It was someone I trusted in my network.” No, you are responsible. You go to jail, they don’t go to jail.
The big trick in the business playbook is to design business processes that can be worked across a team.
In the Internet era, platforms rose as the primary catalyzer of business across the web. As a result of designing, building and maintaining a successful platform, those companies became trillion-dollar ecosystems.
A further step we’re going toward, thanks to the Blockchain, is the potential creation of super or uber-platforms. Those that can be built by combining the capabilities of several digital platforms.
Think of the Uber-platform as an enhanced version of a digital platform. This process will be ready and complete when Blockchain protocols will be mature enough to enable new global entities, as key players.
And the interesting point is those companies part of the uber-platform will act as a single, integrated entity, even though they will be independent companies. We can expect this trend to become mature in the next ten years.
Tip: There is no action yet to take on this trend. Yet it is worth to keep an eye on.
Walled gardens are back
As highlighted in the previous paragraph, uber-platforms might become the norm in the coming decade. There is a current trend though, which for the moment is extremely strong. That is about the platforms that dominate the world as of 2019:
Companies like Google and Amazon, when small startups, focused on growth. As they grew to become tech giants they focused on domination. Domination is achieved when the platform is able to cover the end-to-end journey of its users.
Where a company like Google could not offer a full journey from search to the transaction on its platform (due to technology, and business limitations), it limited itself to perform a core function (search).
When Google first launched, its presumably superior search capabilities were used to enable users to get out of walled gardens. Google’s growth and distribution itself were propelled by deals like AOL (one of the first walled gardens of the Internet era).
Google’s value proposition was compelling because it enabled users to get out of those walled gardens to finally explore the web. Google has been the “ten blue links” company for about twenty years.
Starting 2015-16, the company finally managed to roll out a set of features intended to cover more and more of the journey of the users. Today those features are the rule:
The occurrence of Google advanced features covering more and more of the users’ journey, according to SEMRush sensor.
As competition from other platforms grew, and search technology improved exponentially, Google became a walled garden itself.
And Google itself transformed in a walled garden, where users are locked-in and provided as much value as possible within Google search results pages. In this transition, Google invaded several verticals (from Travel to Shopping) to become the primary brand people deal with, from search to (almost) purchase.
Tip: This transition of digital platforms in walled gardens is concerning regulators (we’ll see it in the upcoming trend for 2020) and should concern you as a business owner. Any physical business has a component of digital nowadays.
If that is the case you need to understand how to surf this wave or be swept away by that. One way to take advantage of this trend is to look for microniches:
The several data scandals that happened in the last years have awakened public concern around the safety of digital platforms. Probably one of the most iconic moments that we’ll remind in the coming decades is those of Mark Zuckerberg before the US Congress.
While Zuckerberg well symbolizes the tech monopolists that dominate the world today, he’s not alone there. Today we have more of a tech oligopoly of companies born and matured with the web.
Proposals have been made to break those tech companies. New technologies, like Blockchain, are awakening again dreams of decentralization. However, this is more of a cultural problem than a tech problem.
Where conventional wisdom assumes that the rise of machines is inevitable, the central questions become about when it will happen. Rather than about how and why it should happen in the first place.
Tip: Not much to do here, but to wait and see what will happen, and of course from a personal standpoint make sure to use those digital platforms with more consciousness.
Chinese tech domination
The reasons Chinese tech companies might dominate the Western world isn’t just due to a lack of competition in their own marketplace from outsiders. But also, and especially by the features of the Chinese consumer market, which offers itself as the perfect lab for tech companies to rise and become global players in no time.
In the FourWeekMBA interview with Jeffrey Towson, he highlighted:
China is arguably the world’s most complicated consumer market now.
I mean you can look at 30 million Chinese consumers live in caves. You can find Chinese consumers in the far West where you’ve got several hundred million of them that looked like a different country.
You go to downtown Beijing, you get more billionaires in Beijing than New York City.
So there’s a huge fragmentation and complexity to them and it’s just getting more so because one, there’s a lot of them.
So when you get a lot of anything, you’re going to get a lot of complexity, and two, you still get this big spread between very, very developed market behavior like Beijing and Shanghai and behavior that’s out in the fields and in the mountains.
So it’s just this hugely complicated subject and the only wayyou can really understand Chinese consumers at this point is you have to go small.You have to study micro populations, Chinese moms, sports enthusiasts, inland consumers, dads.You just have to break it up that way and you find out people are very, very different.
Tip: if you have a physical or digital business look for ways to expand it to Chinese consumers.
Strongest trends in 2020
During the pandemic three core trends reshaped the digital world:
- Remote Working.
For instance, Amazon and Google began an arm wrestle for e-commerce domination.
Pinterest and Shopify expanded their e-commerce presents by enabling social shopping features.
The pandemic changed forever the way we work, and while remote working might still be far from being a mature market in terms of potential development, it is indeed among the fastest growing. Zoom with its freeterprise (then turned into a freemium as the company became a consumer business) and it speeded up its growth.
Other companies all jumped in, from Microsoft, Google, Facebook, they all prioritized video conferencing in 2020, as a way to enable remote working. Competition intensified, and companies like Slack had to consolidate with a player like Salesforce, to prevent to be eaten up by Microsoft’s aggressive growth campaign in the business productivity space.
Other core trends also comprised:
- Digital Marketing.
The Tech IPO Frenzy
As 2020 became unexpectedly a favorable year for digital companies, many of those born in the course of the 2010s, and a few others decided to go public.
The pandemic has worked as an amplifier for tech business models. And among those, companies built on top of the cloud seem to be the ones that are growing at a faster speed.
Many tech companies are going public this year to rush to the market in a favorable year for digital businesses. Some of them also quickly IPO to get liquidity due to their cash negative balance.
Whatever the reason is, this is an opportunity to look under the hood of companies that have been build from scratch in the last five-ten years.
Below the list of the most notable companies getting listed, both at consumer and enterprise-level:
Business life in 2021
With the pandemic still hitting the Western world, we can expect those trends above to keep consolidating. Cloud-based businesses will propel AI-based business models.
Indeed, cloud computing proved to be the perfect technological infrastructure for AI companies, as algorithms still require a massive amount of computation, which is made available on the cloud. And companies like Amazon AWS, Google Cloud, IBM Cloud, Microsoft Azure have all served as platforms to enable the birth of SaaS business models now worth hundreds of billions (take Salesforce).
And consumer businesses (take Netflix) taking over the world.
In that respect, cybersecurity became a core priority, as a too centralized web relying on a few nodes (tech giants run most of the web) is extremely vulnerable to shocks and attacks.
In addition, too much centralization also raised the question of whether the web is still sustainable and if it makes sense instead to decentralize through new Blockchain protocols. Indeed, on Monday, December 14th, 2020, Google experienced a multi-service outage that saw many of its free applications down, which was perceived by billions of people across the world, and even if it lasted for a short period of time, it exposed the weakness of a web which was supposed to be decentralized at its core and that instead became too centralized.
So a core problem to solve in the coming years will be that of centralization vs. decentralization of the web. Indeed, with the forced digitalization brought by the pandemic and the massive amount of capital available on the public markets, we might see the further development of companies that will have very weak foundations, ready to expose the whole world to potential and complete shutdowns!
When a new technology trend shows up, all industries are affected by it. Just think about the way smartphones changed everything. The evolution they brought about is still active.
From July 2019, Google made mobile-first indexing a standard. When the original iPhone showed up back in 2007, the tech world assumed it would influence our lives. But smartphones came far, and no one ever assumed that.
Other technological trends to watch for in the coming decade
We already use it to control different devices in our homes, but this technology will grow more sophisticated. It will be more conversational. As the programs are getting more advanced, we’ll feel like talking to real people.
That moment is not far away. Voice control will be implemented across all devices and networks we use in our home: kitchen appliances, entertainment, lighting, security, work stations, and more.
This is not new. Robotics has been part of the latest technological trends for a few years now, but they are getting more sophisticated. To be more precise, they are becoming more autonomous.
There’s a lot of buzz around autonomous cars, agriculture vehicles, appliances, and more advanced drones.
Can you imagine a drone collaborating with a farming robot?
Currently, car manufacturers are big about producing connected vehicles, so that the base could identify faults and recommend fixes. But in the future, autonomous robotics will go far beyond simple connectivity.
As another prominent trend of future technology, quantum computing is not easy to explain. Here’s how Shohini Ghose explained it in her TED talk: “A quantum computer is not just a more powerful version of our current computers, just like a light bulb is not a more powerful candle…A quantum computer is a new kind of device, based on the science of quantum physics, and just like a light bulb transformed society, quantum computers have the potential to impact so many aspects of our lives, including our security needs, our health care, and even the Internet.”
Today, we already have physical quantum computers. However, they are extremely loud and far from perfect. But there’s a lot of potential in this new technology, and we should have our eye on it.
Security Risks on IoT Devices
If your security system is connected to the Internet, it’s a target for hackers. As we start using more IoT devices in our homes and business environments, the need for enhanced security will be higher. IoT security will become a huge field for tech geeks to explore.
Big Data Is Becoming HUGE Data
All those devices in our home collect data, so they get smarter as they learn from it. The Internet is getting suffocated with data, which will reach proportions we can’t even imagine. Data overload is a real thing, and it can become a problem.
Small businesses are already having troubles with big data. They are getting so much information from their users that they cannot be efficient in classifying it. When they don’t analyze it well, it leads to the wrong decisions.
Data is not the problem. It’s still really useful. We only need more sophisticated analytics, and that’s the focus of future technology.
Blockchain Will Take Us Places
Cryptocurrencies transactions will become an essential part of the banking system. Blockchain is a transparent and secure technology, so governments and financial institutions will use it for tracking all transactions.
When we realize how blockchain can revolutionize the financial system in a positive way, we can’t help but wonder: why are banks not using this new technology yet? They still don’t have the proper network. But we expect to see a change there. When the network comes, the entire banking industry will change.
Digital Twin Technology
The digital twin is a realistic model of a real system, process, or object. The concept has been around since 2002, but we’re yet to see big progress. In a simple explanation, the physical world will get its twin in the digital world, which will monitor systems and analyze data to prevent issues from occurring.
NASA is already using digital twins (or a digital copy of a physical device) that integrate sensor data from the vehicles that integrate historical and fleet data, as well as maintenance history and on-board sensor data. Through this system, they can predict and prevent issues.
This software design pattern is also known as “serverless architecture.” Instead of server software, and hardware management, the developers will host their apps through third-party services.
The application code will be broken upon individual functions, which will be individually processed by virtual servers from cloud providers. The developers take care of their code and they stop caring about server management.
AR, VR, and MR
Who said video games weren’t useful? Augmented, virtual, and mixed reality will be an integrated part of future technology. They originated in gaming, but soon found their use in space exploration, medical care, interior design, engineering, and other industries.
When these technologies are mixed with the global trend of remote work, it’s easy to imagine the virtual workplace of the future. Imagine this new technology enabling you to collaborate with your colleagues not only through a computer but through an experience that’s closer to the real engagement you get from the office space.
I know you hate them. When you see a chatbot, you know it’s only going to give you something from the FAQ. You already went through those answers and you didn’t find what you needed. You hoped to talk to an agent and the bot drives you nuts.
But don’t ditch this form of AI just yet. It’s getting better, and it’s one of the most important new technological trends to watch. Chatbots are the future of customer service. They will make this aspect more affordable for businesses since they will hire fewer agents.
As the bots get more effective, the customers will benefit, too. They will quickly get the solutions they need. If it’s not possible for the bot to solve an issue, it will direct them to the right agent from the customer support department.
The technology depicted in Matrix used to look so sci-fi! Now, it’s close to the reality we’re already experiencing. The movie showed technology as an extension of the self. Are we heading in that direction? Well, that’s a bit too sci-fi… for now. But trends like VR, digital twins, robotics, quantum computing, and big data seem exciting!