Top 10 Predictions for 2023

I first started talking about my top predictions for 2023 over a month ago, in early-November 2022, for an article in The Innovator that you can read below. Even since then, we have seen changes – and my predictions remain flexible to keep pace. Businesses need to do the same in the year ahead as they face an unpredictable market. Read on for some 2023 thought starters and let me know in the comments what you are anticipating for your own sector and business.

Next year is going to be tough. If pundits are right, we may be heading into an economic recession. What’s more, the geopolitical situation remains a wildcard – friction with China, Russia, and Ukraine could have a major impact on the economy and the tech sector. That said, key technologies will continue to ramp up to help countries and businesses adjust and thrive in an uncertain moment in time. As the world continues to go digital at tremendous speed, innovation will continue to evolve exponentially, and we’ll see several tech, business, and leadership trends start to take shape.

My top 10 predictions for 2023 are as follows:

1.????New, game-changing technologies like the metaverse and autonomous driving will develop more slowly than originally predicted. These advances are following the pattern we see time again for new technology trends: First, we get too excited; then the excitement wears off and we become pessimistic and conclude definitely that the technology is not going to come to fruition; and then it ultimately does months or even years later. Metaverse, self-driving cars, and more are still on the horizon – they are just going to take longer than people initially thought.

2.????Cloud and edge computing will become more ubiquitous with implementation of IoT and 5G. Unlike these headline-driving technologies that still have a way to go, IoT and 5G are ready and accessible for businesses. I believe every company is going to become a digital company, and IoT and 5G are only going to drive that further. Further, consumers also benefit through wireless hotspots and sensor capabilities. In the new year and beyond, both businesses and individuals should really look to these technologies to help improve their work and life.

3.????Globalization will be reversed, as supply chain woes and global instability push companies to instead produce and source locally. Globalization had many advantages in the past, including reducing inflation and more competitive pricing and productivity for organizations. Today, the environment has totally changed and there are new benefits for the companies wanting to go local, like having more day-to-day control and avoiding national security concerns. What many haven’t realized is how hard this reversal process is going to be, so it is definitely something to keep an eye on over the next 12 months.

4.????The Great Resignation will become the Great Recommit. This past year, we have seen a lot of workplace trends change in real-time. We started the year talking about the Great Resignation and how companies could not keep talent around. Then, the trend shifted and instead of retainment challenges, we saw U.S. employee productivity fall by the sharpest rate on record going back to 1947, according to data from the Bureau of Labor Statistics. Some have said this further proves the current trend of “quiet quitting”, where employees only do precisely what the job requires and no more or less. My prediction is that 2023 will be the year of the “Great Recommit”. Rather than jumping to a new job every two years, people are going to stay and commit to the companies they work for. They will begin to realize that the grass is not always greener on the other side, and instead look for an employer who can offer consistency and safety.

5.????China loses American tech and begins a decade-long slide from tech leadership which peaked last year. The headlines say it all: Apple recently announced that it had suspended plans to use computer chips from China in future products. The move comes on the heels of the Biden Administration’s restrictions on American participation in China’s semiconductor industry. As a result, many other large U.S. tech companies are also shifting production away from the country, and removing investments and products from its marketplace. Of the major market transitions and tech trends I called in the past, I called the bookends on America’s technology partnership with China very accurately: the time to bet and commit big on China was in 1995, and the time to not invest or bet on an effective win-win with China started in 2017. I continue to strongly encourage my startups to not invest at all in China and to replace China with India in terms of tech partnerships.

6.????Silicon Valley will continue to decline, with several of the five Big Tech firms likely to permanently fall from grace, causing a new generation of players to emerge. Just a short time ago, people thought that it was a given that FAANG stocks –Facebook, Apple, Amazon, Netflix, and Google – would remain dominant players, but it is hard to stay on top for more than two decades. I think we are going to see two (maybe even three) of the “Big Five” fall from grace in the next year. If you look at the numbers, some of them are down 70% or more versus their highs; it is an instant replay of 2000 and 2001, when the top tech companies got hit dramatically after being on top for many years. It was out of that dot-com bubble burst crisis that the current champions emerged, just like the changes that occurred in the 1980s and early 1990s that helped Cisco and other players breakaway. A new generation of tech titans is once again in the cards.

7.????The winning tech companies will move from selling a product to selling business outcomes and solutions. It sounds simple, but this is a new and different approach to the market. It’s moving beyond selling just the technology – you’re also selling how this product will innovate and improve the business overall. If your business outcomes are super strategic and address specific areas of pain like cybersecurity, you will do well.

8.????AI will continue to go mainstream. AI will increasingly be used to improve cybersecurity, derive actionable insights from IoT, automate business processes, and create content. AI will also be pivotal in underpinning the next wave of technological advances, such as personalized healthcare, real-time supply chain management and monitoring, and so much more.

9.????Security concerns caused by geopolitical events, organized crime, and advanced hacking will continue to be top of mind, making cybersecurity more important than ever. The results of PwC’s 2023 Global Digital Trust Insights survey prove this further – a catastrophic cyberattack is the top scenario in 2023 resilience plans, and two-thirds of executives consider cybercrime to be the most significant threat in the coming year.

10.?Startup funding will get tighter, risk-taking will slow, and M&A will increase. There’s money available but securing it will be harder than we’ve seen in recent years where cash was much easier to come by. Investors will make cautious decisions based specifically on profitability and cash flow. VCs are writing down between 10% – 30% of their portfolio value, including deals made this year. It’s a painful process. Multiples will come down – a situation that is likely to last for the next decade – and this is going to lead to opportunities for innovation through acquisitions. Whether it’s small companies acquiring smaller companies, or bigger companies acquiring small companies, I think that’s going to help determine which companies are innovating well and growing.