2020 Business Trends

What to Expect

 

BY LUCY MORRIS

 

As we venture toward a new decade ripe for innovation and change, it’s vital to stay abreast of the coming trends. From the implications of automation to changing workforce standards, we can expect to see a shift in the way business is conducted. Read on to discover the ideas that are likeliest to affect us in the coming years.

 



 

Around the world and here in Chattanooga, companies across various industries have begun to move toward more remote workforces.



Continued Rise of the Remote Workforce

Chances are, you know someone who works from home at least once a week. In fact, International Workplace Group (IWG) reports that 70% of people globally work remotely at least once a week, and 50% of employees work remotely half the week. Most commonly, it’s IT workers, though the trend is expanding rapidly among other departments as well. In the next decade, it’s expected to explode.

Stephanie Sheehan, PH. D. Dean, School of Business, Southern Adventist University

Stephanie Sheehan, PH. D.
Dean, School of Business, Southern Adventist University

This shift, which is a result of changes in technology, employee expectations, and globalization, proves beneficial to employers and employees alike. First and foremost, it reportedly saves remote workers up to $7,000 a year (costs go down for transit, food, clothing, and childcare) and $11,000 for employers (overhead costs like rent and supplies drop). Beyond the financial implications, remote workers report an 82% reduction in stress levels, which directly correlates to an increase in productivity versus in-office employees.

Dell is one of 25 companies hiring the most remote workers today, with 25% of its employees working remotely either part- or full-time. The goal in 2020 is to hit 50%. An emphasis on goals like Dell’s will be increasingly important in 2020, as one-third of employees have admitted they would change jobs for more flexible, remote work opportunity.

Around the world and here in Chattanooga, companies across various industries have begun to move toward more remote workforces. Eighty-six percent of the employees at BlueCross BlueShield of Tennessee are able to work from home at any point, and the turnover rate for those employees is lower than the rate for full-time commuters. Unum is also expanding its remote team, hiring specifically for work-from-home positions, and Amazon announced plans to hire 3,000 remote workers across 18 states earlier this year.

Younger workers especially are drawn to this evolving work practice, and as a win-win for both employee and employer, you can expect to see continued transformation over the next decade. Dr. Stephanie Sheehan, dean of the School of Business at Southern Adventist University, explains, “For business leaders who have the opportunity, it’s exciting to be in the mix of all that positive disruption because you can really affect change and help shape organizational culture that is mutually beneficial.”

 

Emphasis on EQ over IQ in Leadership

In a recent World Economic Forum report that interviewed chief human resource officers about the skills required for workers to thrive in 2020, a new answer cracked the top 10 list – emotional intelligence. Also known as emotional quotient (EQ), it’s becoming more evident than ever that leaders need to not only understand how the business works but also how to appropriately interact with and relate to others. “Organizations are recognizing that the most successful aspect of a leader is the ability to coach,” says Dr. Sheehan. “How can that leader or manager go beyond the bottom line?”

The numbers speak for themselves. Of those polled, 59% of employers said they would not hire someone with a high IQ but low EQ, and 75% of respondents said they would be more likely to promote someone with high emotional intelligence over someone with a high IQ.

There are several reasons for this shift in thinking. For one, it’s suggested that people with high EQs can better handle tough situations like an unhappy client or arguing employees. It’s also said that those with emotional intelligence can practice better self-control, think before they speak, and have the ability to respond rather than react.

“Ultimately,” explains Dr. Robert Dooley, dean of UTC’s Gary W. Rollins College of Business, “you can’t be a good manager and leader if you’re not self-reflective or you don’t understand your limits. And those things are tied to the emotional intelligence of a person.”

Given the stress and pressures that we see continuing to rise in the workplace, those who have the ability to manage change, handle their emotions, and empathize and work well with a diverse workforce will become increasingly valuable.



 

pie chart depicting percentage of independent contractors in the U.S.

 

 



Growth of the Freelancer Economy

In 2020, it’s predicted that 50% of Americans will be working as freelancers or independent contractors either part-time or full-time. Thanks to advancing technology and the gig economy (free market for temporary positions), the conventional understanding of a nine-to-five workday is increasingly shifting toward flexible schedules. Traditional full-time, full-benefits jobs are also harder to find than ever, with unemployment rates hitting record lows.

Defined by the Freelancers Union, freelancing is comprised of five major categories including independent contractors, which are those who don’t have a typical employer and usually work as a 1099 contractor; moonlighters, which consists of those who have a full-time job but also do freelance work on the side to supplement income or gain experience; diversified workers, who have numerous incomes from both traditional employers and freelance work; temporary workers, for example construction workers or software developers who only work for a limited amount of time; and freelance business owners, who have one to five employees who also freelance.

As Millennials move up and Gen-Z enters the workforce, traditional staffing is shifting. “Organizations need to broaden how they manage people to leverage the freelance workforce, which is growing exponentially and showing no signs of stopping,” says Dr. Sheehan. Future Workforce Report reports that 90% of hiring managers are open to working with freelancers. Companies that evolve and consider exploring a similar approach will likely benefit as the market continues to change.

 



 

With 5G, networks can move more data, be more responsive, and connect more devices at one time.

 

 



5G Innovation

Picture this: You’ve just boarded a cross-country flight and realize you forgot to download a movie on Netflix for the trip. To do so at this point would take about 15 minutes – far past when the flight attendant told you to put your phone on airplane mode. Guess you’re stuck with in-flight entertainment.

Today, thanks to the wonders of 5G, downloading a two-hour movie would take less than 10 seconds. But the implications of 5G are significantly more diverse (and some would argue important) than fast downloads.

At its foundation, 5G is a cellular network that provides hyper-fast and more stable internet for users. With 5G, networks can move more data, be more responsive, and connect more devices at one time. This allows everything from robots to security cameras, drones, cars, and more to communicate with one another and transfer data quickly. The data, which is shared through a strong and connected Internet of Things (IoT), serves as the primary driver behind autonomous cars and smart cities.

At present, the four major cellular providers (AT&T, Verizon, T-Mobile, and Sprint) have some form of 5G, though the networks are limited to larger cities. In the coming years, they are expected to expand tremendously and at a more affordable price to support new innovation, more efficient business operations, and infrastructures for cities worldwide.

 

Expansion of Voice Command Technology

Close to 50 million adults in the United States own a dedicated smart speaker. That works out to about 1 in 5 adults – just ask Alexa. Thanks to advances in artificial intelligence, machine learning, and IoT, we’re only just beginning to experience the boon of voice command technology. What started in 2011 with the introduction of Apple’s Siri has expanded beyond measure to industries ranging from health care to banking.

Robert Dooley, PH. D. Dean, Gary W. Rollins College of Business at UTC

Robert Dooley, PH. D.
Dean, Gary W. Rollins College of Business at UTC

Today, industry experts predict that almost every application will integrate with voice technology in some way, shape, or form within the next five years. In 2020 alone, research suggests that 50% of all online searches will be completed via voice technology.

When it comes to brands that focus on repeat purchases (think: grocery stores, cosmetic brands), voice technology is the future. In 2020 alone, RBC Capital Markets forecast that voice shopping done through Alexa will generate $5 billion for Amazon.

Beyond the uptick in voice-generated purchasing, we will see major shifts toward individualizing consumer experiences. Already, devices are learning to differentiate between voices. For instance, Google Home can support up to six unique users today and detect different voices. When User 1 asks, “Who is my first appointment with today?” Google Home can identify which specific voice asked the question and respond with an appropriate answer.

In the coming year, this differentiation will also allow for a shift from one-way commands to two-way conversations. As devices become more advanced, they will start to collect more data about you, your likes and dislikes, and they will adjust their communication based on your preferences. Using your profile, purchase history, and more, you will start to receive intuitive product recommendations and upsells. “With more and more connected devices, voice technology will become a primary driver for commerce,” says Dr. Dooley.

 



 

Graph showing projected values of how Advanced technology and software will continue to increase the automation of work in 2020.

 

 



Advancements in Automation

The word ‘automation’ has huge connotations: some positive, some negative. Ultimately though, it represents a world of endless opportunity.

While automation is nothing new (goodbye encyclopedias, hello Google), it continues to become more and more advanced through improvements in technology. A Global Future of Work Survey report from Willis Towers Watson suggests that business leaders expect 17% of work will be automated by 2020. Everything from financial services to HR recruiting and screening is now possible through advanced software bots and algorithms. Companies like Uber and Lyft are testing automated vehicles and food delivery drones today.

Three types of automation where we will see continued advancements throughout 2020 include robotic process automation, which automates high-volume, routine, and less complex tasks (ex: delivery tracking); cognitive automation, which uses pattern recognition or language understanding to automate tasks (ex: online chatbot); and social automation, which involves robots and humans interacting through a combination of sensors, artificial intelligence, and mechanics (ex: driverless cars).

There is understandable concern that automation will eliminate jobs, but its primary purpose is to reduce specific functions that are risky or unnecessary for humans to complete in order to allow humans to focus on enhancing and optimizing their talent. “There will always be the need for the human element that technology just doesn’t provide,” says Dr. Sheehan.

In the past, large-scale innovation through automation has been limited, but with continued advancements in technology, consumers will see significant change in automation in the coming year. “We’ll see more experimentation with automation in 2020,” says Dr. Dooley. “We’re going to see it become more pervasive in all aspects of our lives.”

 



 

To successfully compete, companies are harnessing new technologies to gather, process, and analyze data.

 

 



Increased Focus on Analytics

“Companies that still aren’t investing heavily in analytics by 2020 probably won’t be in business in 2021,” says frequent Forbes contributor and analyst with Futurum Research Daniel Newman. In fact, International Data Group (IDG) found that 47% of chief information officers anticipate that, over the course of the next 12 months, their spending will increase the most in the area of analytics and business intelligence.

In recent years, companies have learned the importance of collecting data on customers, trends, sales, and more. Data is the future. But what sets one business apart from another in the competitive landscape is the ability to process that data in real time and use it to their advantage.

Major companies are seeing the benefit, and it shows. In mid-2019, Salesforce, the No. 1 customer relationship management platform, announced plans to acquire Tableau, the No. 1 self-service analytics platform that allows people of all skill levels to work with and understand data. This technology is transformational and will further set Salesforce apart from its competitors.

It’s expected that similar products and services are on the horizon. “We are quickly getting to the point where data analytics will no longer provide firms an absolute advantage,” says Dr. Dooley. “Firms will need to use and understand data analytics to just remain competitive.”

There will be a steep learning curve, but when data and analytics are used in tandem, companies can identify differentiators. “The challenge I hear a lot of executives and senior managers talk about is, they collect data and have people analyze it, but they don’t know how to translate what that means for their bottom line. That’s essential for driving business decisions, efficiency, and results.” CS

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