2023 Outlook for the Business Market
– Taking Care of Business

The good news coming out of 2022 was an easing of the pandemic, which allowed businesses to operate less virtually, and to bring more workers back to an in-person environment. While this was welcome for some, others now prefer being home-based, and to manage both, we now have the hybrid work model. There is no blueprint for this model, and during 2023, businesses of all sizes will be learning as they go. That presents a challenge on many levels, and to compound matters, businesses are now faced with a weak economy that could persist beyond 2023. With rising costs and higher interest rates, managing the hybrid model will be even more difficult, especially for businesses that are struggling just to survive. While SMBs will be constrained by limited financial resources, enterprises have their own issues, not just for managing a highly decentralized workforce, but in many cases, the cost of carrying a lot of empty office space.

To frame the analysis, I will now outline three challenges facing SMBs in 2023, along with steps they can take to address them.

Challenge 1 – Keep costs under control

As a matter of course, all businesses need to do this, but it’s even more difficult in the current climate. Everything is more expensive now, and there are only so many price increases you can pass on to your customers. Where possible, you can switch to cheaper suppliers and partners, but you must always be mindful not to compromise too much on quality.

One approach would be to use credit – if you can get it – to absorb higher operating costs, but with the recent spikes in interest, that’s an expensive way to keep operations going. Interest rates aren’t likely to fall soon, making this a risky strategy, especially if banks tighten their lending practices.

Since all businesses face similar conditions, you won’t be alone, but some will manage their costs better than others, so to get through 2023, you’ll need to be more creative, and look at every aspect of your operations. One such area would be your spend on communications technology. Until recently, telephony was likely your biggest expense for communications, often built around a capitalized investment in a phone system such as a PBX.

While PBX technology was very good for its intended purpose, telephony has evolved in many ways, and innovation has given rise to alternatives that will be especially attractive in today’s economy. Not only are these alternatives less costly, but the voice quality and reliability are on par with legacy technology, and the capabilities are significantly enhanced.

For a variety of reasons, many businesses remain tied to their legacy phone systems, and with today’s alternatives, that position is getting harder to defend. Even if the system is fully paid for, the ongoing maintenance is expensive, and vendors are no longer supporting them. In terms of keeping costs down, there are two factors to consider here.

First, VoIP-based telephony is software-based, and doesn’t require another capitalized investment. Aside from eliminating that spend, the service itself costs less than PSTN-based service. Secondly, these services are cloud-based, and this deployment model has emerged as a more cost-effective way to manage your spend on network infrastructure. Not only that, but cloud-based communications is the best way to support hybrid work, as it ensures that workers have the same capabilities whether at home or in the office.

Challenge 2 – Stay competitive

Cost control is vital for survival in this economy, but SMBs must also do whatever they can to stay competitive. Globalization has made every sector more competitive, both for SMBs and large enterprises. Modern communications technology is a key enabler of global competition, and no business can afford to take their customers for granted. Information and conversations move too quickly over the Internet, and customers can always find another company to buy from if you fall short in their eyes.

This reality is even more of a factor in 2023, as customers face the same challenge as businesses. With rising costs leading to higher prices, consumers will be more willing to buy from a cheaper competitor, and even be willing to accept lower quality along the way. For most businesses, there’s only so much you can do to lower prices or improve the quality.

There are, however, other ways to be competitive, and this is another area where communications technology provides great value. One way is to maintain a culture of professionalism, where customers see a well-run organization that values its customers. This is where advanced features from a VoIP telephony system can help, such as showing the name of your business on caller ID, or having smart self-service options for easy navigation.

Internally, VoIP telephony plays another role by making it easier for employees to communicate with each other as well as to collaborate to address customer needs. The key difference from legacy telephony is how VoIP natively integrates with other communications channels and applications, such as email, chat, mobility, directory, calendars, etc. All of this can be managed in a singular interface, making your operations more streamlined and efficient. The net result is to be more agile, allowing you to be more responsive to customer needs, and that’s a great way to build a competitive edge.

Challenge 3 – Keep a strong team

With this post being focused on business operations, top management must also consider their most important asset – the team. Keeping employees happy and building strong teams makes for a culture that sustains a business through good times and bad. Investing in the right technology is critical, as employees can only perform as well as their tools will allow.

On one level, this means being able communicate internally to get things done, as a noted above, VoIP brings far greater capabilities for this than legacy telephony. Many businesses still operate on a siloed basis, where various applications are standalone, such as the PBX, which runs on a dedicated voice network that doesn’t integrate with anything else.

Today’s workers are more tech-savvy, where multichannel communication is the norm, and for them, that legacy model becomes a drag on productivity. The easier it is for employees to work across channels and applications, the stronger your teams will be, and the better your operations will run.

On another level, you must also consider why agility is so important. In the Internet age, the speed of business has never been faster, and it will only accelerate. Not only must your operations move fast enough to keep your competitors at bay, but also to support customers who want everything in the moment, not sometime later.

Your teams need to keep pace, and that’s difficult to do when everything is in separate silos. They need seamless communications and efficient processes to get things done and to keep customers happy. Technology is just one factor to make teams strong, but with today’s cloud-based offerings, it’s one that you can effectively address, both for keeping costs under control, and properly supporting your employees.

Looking to upgrade your business phone system? We offer solutions to help you manage operational issues while keeping your customers happy and loyal in a weak economy. Schedule time now with an Ooma specialist!

Jon Arnold

Jon Arnold is an independent analyst providing thought leadership and go-to-market counsel with a focus on the business-level impact of communications technologies on digital transformation. Core areas of technology expertise include unified communications, cloud platforms (UCaaS/CPaaS/CCaaS), AI, automatic speech recognition (ASR), contact centers, customer experience, and VoIP.