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The Top 4 Biggest Threats To Businesses Today

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In the world of business, every generation has unique challenges. Technology is responsible for most of the change as new products and systems disrupt the status quo. In years gone companies had to adjust to the creation of the printing press just like they got used to the radio, television, the computer, the internet. Then there are the political and economic highs and lows to contend with, the recessions or bust to boom trading times.

At any given time, it is essential to understand the SWOT (strengths, weaknesses, opportunities and threats to the company and industry so smart choices are made along the way. For example, a business will hold off investing in additional hires or investments if the timing is off. Plus there may be an opportunity to release a new service or product due to increasing demand prompted by economic or political conditions.

Here are the top four biggest threats to businesses today:

1 – Technology

The impact of new technologies can be a gamechanger or require minor adjustments. For example ‘going digital’ or taking your business online will please many customers but not those adverse to change. These people are typically in the ‘laggards’ group of the technology adoption curve and they are the last to change to newer technologies.

Many industries struggle directly or indirectly with the speed of technological change, and sometimes they can be replaced by startups providing a product or service which is far superior. For example, Uber and ride-sharing, has disrupted the taxi industry, and some may say it’s forced may taxi firms to go out of business.

One of the biggest dangers a business faces is in believing that they are invincible to these forces and one area which is also as worrying today as it was yesterday is cybercrime. No website is safe or protected entirely from hackers and they are using innovative ways to get to your systems including AI assisted ransomware.

On a positive note, technology has bought companies closer to their customers. Software and apps have increase efficiencies within the business and opened up the global economy insofar as the clothes are likely to have been made in more than one country.
Technology can provide opportunities, as well as threats.

2 – Globalization

Each business is now competing in every market in the world. This, again, is a product of technology but has also become a point for concern in and of itself. It is easier than ever to send work overseas, find products from other parts of the world, and communicate with potential partners in other countries. This all creates new challenges for businesses.

Due to international laws, a company may be limited in what they can do about some of these challenges, but that only means they need to be more creative in how they combat them. For example, if your company’s product or service can be outsourced overseas at a much lower cost, you need to think about another way to make yourself more appealing at a higher price point. This is a challenge in a cost obsessed environment, but not impossible.

3 – The Shifting Face of Labor

This is also influenced by the development of technology but is much more a matter of people. Job seekers are becoming more and more able to find work they can perform from the comfort of their own home. Not only that, but the most youthful members of the labor force spent their entire lives in a world of massive connectivity.

If a company does not adjust to the needs and demands of the new labor market, they can expect potential employees will seek work elsewhere.

4 – The Speed of Change

We touched on this topic earlier, and now we’re in the 5th industrial revolution changes are happening faster and on a much larger scale than they have ever occurred before. This means that a business could make a shift in strategy today that is the right decision, but in a short time, they may need to shift away from that strategy.

The level of flexibility that companies need is something relatively new. While it is essential to display a level of consistency so that consumers know what to expect, if a company allows that consistency to turn into stubborn continuity, there will be a price to pay.

Staying Vigilant

These are only a few of the challenges that businesses face in the world today. There are, of course, many others just as there are new ones right around the corner. In today’s fast-paced, globally-connected world, business executives need to be as vigilant as ever if they hope to be prepared to handle these challenges.

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