Sitting back at your desk after a month of busy family time or relaxing beach days, business owners and executive teams should start to think about not only the year ahead, but the long-term viability of their businesses.
With rapid changes and multiple existential threats impacting different businesses in different ways, it might be an opportunistic time to ask yourself: do you expect your market and/or customers to be subject to fundamental change? Will your business be viable in ten years’ time if it continues on its current trajectory? Do you have the option of carrying on as you are and hoping for the best, or do you need to make some proactive (and potentially risky) changes to give your business the best chance of continuing into the future?
With pressure from consumers for reinvention intensifying, it’s no surprise that we are seeing businesses adopting new technology. Air New Zealand, aware of its reliance on fossil fuels, is looking at new ways to power their aircraft fleet. They have just purchased their first all-electric aircraft which will operate cargo routes starting in 2026. They also plan to begin replacing their regional domestic fleet with more sustainable aircraft, with goals to use either green hydrogen or battery hybrid systems from 2030.
Other companies are pivoting into new areas to meet changing consumer demands. For example, consider the amount of ‘plant-based alternatives’ available today, with fast food restaurants like Burger King offering an entire range of plant-based meat.
It’s no secret that climate change and sustainability are hot topics at the moment, and while much of the change is driven by Government, the reality is that consumers are forcing these changes with their wallet.
It is becoming more and more common for a business to accept a lower return on climate-friendly investments, showing a willingness to accept a trade-off of financial return for sustainability outcomes.
Electric vehicle sales are rising across the country, and while it might not have been a consideration 20 years ago, consumers now consider whether the products they purchase have been ethically and sustainably produced.
Companies even need to be mindful of sustainability if they want access to capital, with banks, investors and equity funds refusing to invest or adopting a sinking lid approach depending on the industry a company operates in.
The changes happening now are not just something that the big companies need to worry about. Small companies are more likely than their larger company counterparts to feel their company’s viability threatened, and for good reason. The shifts over the coming decades will have flow on effects to all facets of business. Think electric cars – what is a mechanic doing 20 years from now, or a petrol station operator, or the person that leases the land to the petrol station?
By taking the time to reflect, you place yourself in a much better position to not only survive the next few decades but also capitalise.