Happy new year! What a year 2022 has been. It was nice to meet family and see friends last year after the restrictions of the years before. However, 2022 went for you time for a new year, a new start and new predictions! But first, let’s look back and see how I did in my predictions from last year here. 3 out of 3, that’s my first 100% in 5 years of prediction writing.
We saw the rise of intelligence systems with CHATGPT and DALL·E 2. My Linkedin post is here We saw a push for remote relationships across every industry, from vets and Drs to car sales. Experience as a service and integration into an ecosystem slowed as VCs focused on ROI rather than growth at any cost; we will see more focus on these three this year.
So moving on to my 2023 predictions, I am sure some of you have a new year’s resolution to be healthier. The same will be valid for organisations given the reduced funding moving through the system; organisations must optimise to ensure a healthy organisation, reduce operational costs and wasteful activities, maximise scale and pioneer through innovations and focus. There is a lot loaded in one sentence, so as MC hammer would say, let’s break it down:
- Growth
The theme of limited funding will continue this year. Last year organisation focused on reducing operating costs, reducing workforce and customer retention. This year’s focus will be now on profitable growth with the stay team. There is much debate about Product Led Growth (PLG) Loops and traditional AARRR Funnels. For me, it depends. It’s not one or the other but one feeding the other.
PLG is a great way to create competitive moats for organisations and forces the detangling of organisational complexity, which is an excellent thing for a healthy organisation. Growth loops have INPUT, ACTION, and OUTPUT. The AARRR funnel focus on acquisition, activation, retention, referral, and revenue. If executed correctly, a growth loop can be the flywheel of user acquisition and retention, fueling growth. Utilising loops helps across the piece with leaky buckets, cost and market retention! There are a few loops to think about: sales, word of mouth, viral, user-generated content Etc. and which works best for the organisation. Word of caution there is no silver bullet, and it’s not about removing your funnels but about allowing your funnels to feed the growth model and adjusting the leavers over time.
2) Accelerated Decay – The need for business model transformation
Dealing with an economic crisis is part of doing business; with the challenging backdrop of market conditions, most organisations will only be able to throw a small amount of money at a problem to gloss over leaky business models. The net result will be an accelerated decay of unhealthy organisations.
Organisations that realise they need to boost their immune system and increase their resilience will focus on their business model transformation. They will need to be prepared for uncertainty, have at least 18 months cash reserve runway, have a positive cash flow, identify areas of decay that require changing and execute on business model and technology innovation in parallel. They will pioneer new forms of engagements with opportunities unlocked through Business to Business (B2B) ecosystems, adaptive AI with tangible value, platform engineering, and partnerships, and uncover new forms of virtual opportunities in the metaverse.
Business model transformation is complex and requires several leavers, including profitability, efficiency and growth. In addition, it involves process changes, the composition of teams and innovation in product offerings. Whatever business model transformation organisations do to maximise stakeholder value, they must also improve environmental and social ecosystems.
3) B2B – The big unlock
Unlocking the potential of B2B will be key this year, with cloud computing low code, no code and a service platforms engineering. This year will be the time for B2B to become sexy. Organisations should design features with B2B in mind, even if the first consumer is their channel. Developing a capability that can be used across all channels and 3rd parties will put organisations in a good place for the future. This will enable the B2B ecosystem. Lego bricks of capabilities where recipients in a B2B concept may want to use the capabilities in different contexts delivering service and solution innovation.
2023 will be an eventful year. Organisations will need to grow by acquiring market share, innovating in technology and business models and exploiting the competition to their advantage. I trust you are having a brilliant start to the year, and I look forward to our interactions in 2023
Best,
Bhavesh
Digital Craftsman
Delightfully Dyslexic, so please forgive the typos!
