Executive Outlook, new insights

This week, Executive Outlook explores what’s keeping local business leaders awake at night and how we’ve pivoted into these unusual times, matched against broader data.  We hope these highlights are helpful, and would love to hear your views.

One of the most striking trends from our research is the nature of challenges across different sectors. It’s hard to pin this down. For example, property, retail and professional services are beneficiaries of record low interest rates and phenomenal interstate migration.  For importers and manufacturers battling global supply shortages and an explosion in raw material costs, it’s a very different story.  Our findings bring home the story of a multi-tier economy.

We identified cybersecurity as the No. 1 threat facing companies. Cyber attacks and COVID fuelled scams have skyrocketed.

“It takes just one person to click on an infected email link, and there goes your data”.

It’s now a battle to distinguish malicious phishing emails from genuine ones. They’re so sophisticated, even spam filters and Trend Micro are not immune.

“Our last line of defence is the human brain – make a judgement call. If you don’t know ask the experts”!

ACSC statistics show Cybercrime and ransomware reports are up 13% and 15% respectively, on last financial year. Attacks on essential services and online commerce have spiked. Security experts call it “a race against the attackers”.

To subscribe to alerts and best practice, go to www.cyber.gov.au.

Two in three business leaders cited hiring difficulties, and unrealistic salary expectations are a hot topic. (Of course, there’s no inflation, if you believe in the tooth fairy).

Dealing with new regulations showed up multiple times in our interviews.  It falls back on leaders to develop new systems to fulfil these obligations. There’s an opportunity cost.  Compliance underpins safety and protects stakeholders – we all get that. The issue is the goalposts keep moving, and it takes a toll on our leaders. This one’s never far from controversy.

“This takes time and resources, and diverts our attention away from growth strategies”.

 It appears that it’s not just local businesses experiencing this.  

HR Daily reports show “Organisations are falling into a “vortex” of risk mitigation, with intensifyng pressure on decision-makers hindering productivity” (15/9/2021).

The local housing market faces a shortage of stock (both sales and rentals).  The prevailing uncertainty pushed potential sellers to sit tight, and use surplus cash to renovate instead, driving prices through the roof. (This is just starting to turn around, with more auctions and listings coming back to meet demand).

Everyone’s talking about the massive growth in infrastructure and housing in SEQ. The deals are on the table, but  builders are hard placed to guarantee contract pricing or availability of materials, due to global supply shortages (made worse by the destruction of interstate supplies in recent bushfires).

Master Builders’ Association Qld. deputy CEO Paul Bidwell said “The cost of timber, frames and trusses increased some 75% since the start of the year”.

“Timeframes for new homes have been pushed back month after month. When prices are locked in, builders have to absorb price hikes. Provision clauses are now being written into contracts”.

It’s a similar story for importers and exporters, faced with a perfect storm of freight hikes, industrial disputes, delays and container shortages.

 “Global shortages have delayed production, and accelerated costs (turnaround can take months)”.

“A 40 foot container pre-covid cost $500 in shipping freight. Our last one cost $13,500 (in just 18 months). That’s if you’re lucky enough to find a space on a ship.”

Some manufacturers are caught up in the trade spat with China, compromising supply relationships. National Farmer’s Federation say freight costs for farming exporters spiked 6 fold in the last 18 months.

 “There’s no end in the short term, even as ports open. Backlogs will take 6-12 months to catch up”.

“The worry is hyperinflation, and what flows on from that – risk default of loans, cut to the bone”.

It’s inevitable that these costs are passed on to homeowners and consumers.

Local business leaders exposed to these elements are pivoting into niche high margin products and only taking on profitable work”.

Trade has bounced back for community events and local cafés, but skills shortages are biting.

Are you a barista who can work under pressure with people skills? Please apply”.

Occupancy rates in the City took a hit from interstate lockdowns, with flow-on effects on corporate travel and tourism.

“Every time we have a snap lockdown, we can lose a significant amount of revenue overnight”.

Have you reshaped your business?

75% of business leaders have pivoted in response to COVID havoc. It’s been a steep learning curve, calling on truckloads of agility and resilience to bring our visions to life.

“We’ve learnt to be less reliant on core business, and more focussed on growing new opportunities”.

“We’re adapted to “solution selling” ways to interact with clients”.  

“We educate our clients on shifting market dynamics, to achieve desired outcomes”.

“Train everyone as rainmakers, to engage with our clients”.

“Rework the skills and technology needed to address rapid change”.

“We’ve embraced digital marketing, educational webinars and virtual product launches”.

Next week we bring you the latest from Executive Outlook on remote work.

Compiled by Jan Gadsden, Founder of Top Office Group Pty Ltd.