INTERNATIONAL BUSINESS REPORT (IBR)

Staying one step ahead: Smart investment key to emerging stronger once uncertainty lifts

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According to the latest data from the International Business Report (IBR), Grant Thornton’s global survey of mid-market companies, business leaders are being cautious about their future investment intentions.

According to the latest data from the International Business Report (IBR), Grant Thornton’s global survey of mid-market companies, business leaders are being cautious about their future investment intentions.

 Across the board, in the second half of 2022 plans to invest were slightly down compared to H1 2022. Investment in staff skills has fallen by 2% to 53%, research and development intentions are down by 4 points to 51% and investment in technology is down by 3% to 57%.

While it's understandable that some businesses are more wary during the current economic and geopolitical uncertainty, the fact that more than half of mid-market businesses are maintaining investment in skills, R&D and tech demonstrates their desire to keep moving forward. Business leaders that maintain focused investment during the current economic headwinds are likely to be better positioned to sustain value and grow once economic uncertainty lifts. 

It rarely makes sense to hold back on investment during an economic slowdown. The bigger risk for businesses is that, when the uncertainty ends, you may be behind your competitors.  Business leaders may also miss out on an opportunity to create (invest in) new revenue streams.''

 ''While it is important to hold on to cash, it is equally important to have a robust investment strategy for an organisation. You need to understand the market in which you operate, understand the cycles of the economy, and know exactly under what circumstances your specific organization can thrive.Oupa Mbokodo, Head of Advisory.

Business leaders who will be best positioned for growth when economic conditions improve will be those that scenario plan and can see past the immediate challenges to the opportunities beyond. Organisations need to be future focused to ensure they remain sustainable over the long term. In this light, innovation can lead to higher productivity and new markets, which then has a positive impact on the wider economy, can improve the social impact of the organisation and can benefit the environment, if done sustainably.