5 business investments for the future

The last year has been a revealing one. Many businesses, struggling with the sputter and stall nature of the global economy, have started to realise the unsympathetic truth. This isn’t a recessionary valley between two growth peaks. It is a plateau. A new normal.

Look around you and the evidence is in plain sight. Yet, for all the pain, we do see a few smiles. For every bucketful of firms who are consolidating or losing ground, there are a handful who are winning. Some businesses are even booming.

Even in Singapore, which habitually winces at every bump on the global economic highway, we see pockets of excellence and high growth in every sector.

Closer analysis reveals why. The losers are looking backwards; and hoping for a return to times when their business and capital investment models were viable. They spend precious hours trying to predict a V, U, W or L shaped recovery.

The winners on the other hand, have cut their losses and gone back to basics. They are prudent, willing to eschew the status quo, and don’t blame Europe or China for their problems. They realise that every problem is actually an invitation to change, and to learn.

If this is indeed a new normal - and we won’t see too many governments, organisations and individuals return to the profligate ways of the past - what does the playbook for the future look like? What business investments will generate the best returns on this new hard economic plateau?

I have five suggestions. In the future, winning businesses will invest in –

1. Knowledge - It is our pace of learning that drives our pace of change. Investments in increasing our understanding are powerful enablers of ideas, innovation and creative solutions to new problems. But learning must be a daily activity and embedded in the job. Forget the old fashioned training program. Invest instead in increasing learning on the job, staff rotations, peer dialogue and in providing unique experiences.

2. Customer intelligence - Customers today are more aware and better informed than ever. And a globalised world means businesses are no longer protected by domestic boundaries. You now compete both on quality and price with the best in the world.

How should you respond? By letting customers drive your change. Listen carefully to them. Involve their ideas and feedback in product development. And don’t waste money educating them. Invest your money learning from them.

3. Relationships - Invest in your alliances. The mantra of today’s economic world is “we win together, and we lose alone”. Find your allies, cooperate to increase your reach and reduce your cost. Outsource and reduce overheads. A lean and collaborative business that plays to its strengths has a better chance of navigating the future, when compared to a siloed, lumbering megalith. In this new world, collaboration trumps complexity any day.

4. Experimentation - For 30 years authors and consulting firms have tried to convince us that success can be copied. By adopting a GE process, we can become the next GE. Sounds incredulous, but it’s true. We have spent billions of dollars and millions of hours trying to be someone else. The age of best practices is dead. The age of experimentation is upon us.

Now invest the same money and time in trying to be your best self. Invest in developing your own methods, products and strategy. Remember, inquisitiveness is still a virtue, but copy less and experiment more.

5. The Employment Contract – Arguably the most important of the five. Today, data tells us that the contract between employee and employer is at its weakest point in recent history.

In good years, voluntary employee attrition goes through the roof, and in bad years, layoffs do the same. Trust is eroding, and eroding fast. This needs our focus and investment – and just throwing more money at talent isn’t the answer. If they don’t enjoy coming to work, more money may make their body turn up, but their mind will still be in bed.

Invest instead in helping employees achieve their goals. Both professional and personal. Invest in their ideas, and they will turn up to see them through. And train your managers to manage a changing employee. In specific, a more assertive, empowered and purposeful professional.

Innovate the workplace, encourage flexible working and champion diversity. Realise that if only half your headcount is engaged, the other half on your payroll are actually benefiting your competition.