Many habits and processes adopted during the pandemic, such as increased online shopping and remote work, have become standard in the business services industry. Additionally, the industry weathered new challenges with labor shortages and is now bracing itself for a possible recession in the near future. Here are five trends we saw in 2022.
1. An increase in labor costs
The Bureau of Labor and Statistics reported that compensation costs for civilian workers — private industry workers and state and local government workers — increased a seasonally adjusted 1.2% in the third quarter of 2022, largely due to increased retention and worker shortages. In 2023, business services firms should look for ways to reduce other previously fixed costs, utilize automation, and digitize manual processes. By using remote online notarization (RON) instead of traditional manual notarization processes, business services companies can save between $97 and $103 on each internal transaction.
2. Digital transformation as a top priority
The Hackett Group reported that 61% of business services companies listed enterprise digital transformation as their top priority in 2022, up from 53% in 2021. The most adopted technologies include robotic process automation (RPA), digital workforce enablement, business process management (BPM), and cloud-based service management tools — all with a greater than 75% adoption rate. The report also found that 78% of GBS applications are expected to be cloud-based in two-to-three years, from 33% in 2022. As more business services firms reach digital maturity, organizations that have not started or are still in the early phases of their digital transformation are likely to lose customers and employees.
3. Remote and hybrid work is here to stay
As the reopening of offices accelerated in 2022, many employees continued with flexible working arrangements.
The Hackett Group found that 85% of business services professionals work remotely or within hybrid home-and-office models. That number is expected to lower slightly in the near future, with 30% working primarily from home and 50% working hybrid. Firms that do not offer flexible options may lose top employees and recruits to other companies with remote or hybrid work models.
4. Demand for digital payment and ordering options
According to Gartner, 83% of B2B buyers prefer ordering or paying online, making it essential for business services firms should look to incorporate digital ordering and payment options whenever possible. As consumers increasingly use digital tools for daily tasks in their personal lives, they are expecting similar provisions in the business environment.
5. A higher focus on data privacy
B2B customers are increasingly focused on how companies use their personal data. Gartner found that 86% of B2B customers expect businesses to explain how their personal data is used. Additionally, customers expect their data to remain private and secure, and to be used solely for its intended and expressed purpose. By understanding these concerns, business services firms can take the extra step of discussing data privacy processes to keep customers informed.
Improving the customer experience
The companies that business services firms serve have experienced dramatic changes in the past few years. These shifts presented firms with new challenges, including how they operate and where their employees work. By considering these changes in the context of their business models, firms can design customer experiences and processes that improve satisfaction and productivity.