As business technologists, it is interesting around this time of the year to reflect on the year just passed, and to consider what might be in store for the year ahead in terms of data and analytics.
While there are no guarantees, it can be beneficial to understand current trends and to factor those into your operational plans for 2024.
That said, the fundamentals of business are not specifically about data or technology – businesses exist to provide value to customers and shareholders, while operating efficiently (i.e. profitably, in most cases).
Whether you are a large enterprise, franchisee, or small business owner, everyone will always benefit from a deeper understanding of their business, and better-informed decision making.
Although trade and economic conditions in Australia are tough right now it is important to recognise that customers will always gravitate towards superior products, exceptional services, and genuine value – regardless of the industry, channel, geography, or commercial environment.
The criteria for success, therefore, depends heavily on quality of execution – from a data perspective, both well-informed and rigorously managed.
Likewise, the core value proposition for franchisees remains (among many things) the access to proven business models, operational support, and access to resources – all of which provide a powerful route to market and risk reduction for operators.
Franchising at its core is about providing information (i.e. data) to franchisees, both operational and insightful, in ways that are easy to leverage.
Data and tech factors for 2024
Looking ahead then, several critical data and technology factors/influences come into play for franchisees in 2024, including:
While high-profile data breaches are making headlines, the proliferation of data across franchise networks presents an ongoing risk, demanding strong, multi-party governance and security programs.
Modern, cloud-based, data platforms simply these processes however the volume and sophistication of attacks will also increase. With superior analytics the business value of data continues to increase and must be protected accordingly.
Certainly nothing new, but effective use of data is a cornerstone of business (and franchisee) success. Regardless of whether it is overall customer experience or point of sale (in-store or online), marketing, supply chain, and even recruitment, the need for an integrated view of the business is critical.
Beyond that, with increasing economic pressure, the need to optimise and streamline the franchise model becomes critical.
If one is a multi-outlet franchisee, or the franchisor itself, modern financial management demands a cohesive and unified view of performance across the portfolio. Managing data across different stores (even within the same franchise), and through different operators, has always created challenges.
Again, economic pressure, along with the availability of next-generation data management tools, means there is no excuse for lack of transparency across the board. The very nature of the franchise model means that insights and optimisations need to be scalable (and relevant) across the entire
Artificial intelligence (AI)
The biggest and most visible impact on data and technology in 2024 will undoubtedly come from AI. Even though the underlying technologies have been around for a long time, the astonishing rise of consumer-grade AI, most notably in the form of tools like ChatGPT, cannot be ignored or its impact underestimated.
Given its speed and volatility, the full ramifications of AI are unlikely to be understood for the next few years. That said, the accessibility and productivity benefits of the technology today will drive tangible benefits to all parties in areas ranging from marketing, through store operations, to finance.
The follow-on lesson from this AI onslaught will be a renewed dependency on data quality and business relevance.
Perhaps a little out of left field, the rise of public interest in sustainability, along with increasing obligations around environmental, social, and governance (ESG) reporting means that data will be used in
new ways. In the short term this may well result in a compliance headache. However the broader implications are the creation of new insights on operations and cost of a franchise, as well as new dimensions for customer engagement.
In all likelihood, ESG reporting will become part of the standard support provided by franchisors, in order to support efficiency and administrative overhead.
In conclusion, it is clear that in the face of a tighter economic environment, the main trends in data and tech will be around efficiency, while simultaneously reducing risk and costs. This situation is as it should be, although accelerated somewhat by commercial necessity.
There is however one, very disruptive, outlier in AI. The immediate impact, coupled with its obvious potential, means that AI will be the technology to watch in coming years. For now, the best bet is to get your data and operations in order so that both franchisees and franchisors can reap the coming benefits as quickly as possible.