The biggest challenges expected to impact business leaders this year

With a new year comes new challenges. Keeping up with the latest trends can be beneficial to remaining on top of any issues that may arise.

This was discussed in KPMG’s Keeping us up at night 2024 report. Respondents listed the top 10 challenges expected to impact their organisation as:

1. Protecting and dealing with cyber risks (43 per cent)
2. Talent acquisition, retention and re/upskilling to meet a more digitised future (42 per cent)
3. Dealing with evolving regulatory processes, reporting changes and impacts (41 per cent)
4. Cost controls in an inflationary environment (38 per cent)
5. Digital transformation and optimisation and extracting organisational value from it (38 per cent)
6. New technologies (AI, machine learning, blockchain and distributed ledger technology, quantum computing) and the use cases and ethics that arise when implementing (27 per cent)
7. Identifying and growing future market segments and/or innovation opportunities for growth (25 per cent)
8. Balancing short-term versus long-term value creation in your organisation (25 per cent)
9. Designing and implementing an ESG strategy that will deliver benefits in short and long term (22 per cent)
10. Declining consumer confidence as a result of cost of living and interest rate pressures (20 per cent)

It’s no surprise that cyber security ranked as a top concern, especially after the high-profile breaches that have rocked many organisations over the last few years.

“The nearly daily examples of cyber threats show that cyber security should be at the heart of business and used as a foundation to build digital trust among customers, suppliers and staff,” said consulting partner Natasha Passley.

Tech is an overarching theme throughout many of the rising challenges. This is expected to continue as digitisation prospers, highlighting just how crucial it is for businesses to keep up to date and hire skilled workers.

KPMG commented: “In the people area, hiring staff that are already digitally savvy and able to take the business forward in an increasingly computerised world is critical.”

Coinciding the challenges expected to affect organisations, the report also listed the wider social issues that could impact the business environment. The top 10, as listed by respondents, are:

1. Geopolitical disruptions and shifting levels of regional/global tension and cooperation (50 per cent)
2. Embracing the economic opportunities that climate change, energy transition and the move towards net zero presents (46 per cent)
3. Preparing for a future skills gap – technology, data scientists, health workforce shortfall (46 per cent)
4. Social impact of new and disruptive technologies such as AI, autonomous vehicles, internet of things, biotechnology, and a different physical world (46 per cent)
5. Meeting the challenges of housing availability and affordability (33 per cent)
6. Social licence to operate/reputation (33 per cent)
7. Meeting the challenge of an ageing population (32 per cent)
8. Tax reform and policy settings to increase productivity and inward investment (31 per cent)
9. Dealing with future income and wealth inequality through shifts in intergenerational equity – the balance of financial burden on younger versus older generations (30 per cent)
10. Inflation, rising interest rates and other economic impacts (30 per cent)

“Geopolitical disruptions and regional tensions are viewed by our business leaders as much more than the risk of conflict and escalating military actions. Trade tensions, the weakening of Pax Americana, and the bifurcation of geopolitical alliances on an east-west basis have also impacted perspectives of the Australian business community,” explained KPMG.