Despite an optimistic start to the year, the UK now faces yet more economic headwinds as global uncertainty continues. Whether it’s the conflict in Iran, rising protectionism or supply chain shocks – events this year have undeniably impeded UK growth.
In response this week, the Bank of England held interest rates at 3.75%. and the Chancellor delivered her Mais Lecture championing new avenues to for the UK to pursue economic growth – especially through tech and AI.
While these announcements may have intended to signal calm and optimism, they were unfortunately drowned out by the sound of war drums and frantic energy markets.
As service-led business leaders we have to face into the realities in front of us. And while doing so, we should remain resilient in our values, and our ambitions. A huge part of our economy relates to services, which offers something of a buffer to the energy crisis, but we are also far from self-sufficient when it comes to energy production and higher gas, oil and electric prices feed into inflation across almost every business.
Agile and sound judgment, not bureaucratic red tape
Turbulent periods tend to mean we focus harder on our priorities, but they can also encourage us to be flexible and think creatively.
In the FT this week, Richard Moriarty, the chief executive of the Financial Reporting Council, captured the idea that boards need to feel free to think for themselves and should use the flexibility in the UK corporate governance code to make the brave, informed judgement calls that times like this require.
At The Institute, we work closely and collaboratively with regulators and we are encouraged to see more regulatory frameworks that prioritising outcomes over minimum requirements, so that both customers and businesses stand to win in a way that enables innovation and progress.
In 2026, boards will need to exercise sound judgment on several pressing issues, ranging from how to meet evolving customer preferences, how and where to deploy AI (effectively and ethically), how to manage climate change risk, and how to bring your people on this journey with you. All these areas require a delicate balance of agility and consistency. And these are all areas we have recently, or will soon, address in our Breakthrough Research pieces.
Our customers are our lifeblood
While the external environment may be full of distractions, as service leaders we should spend our effort on what we can control.
As Steve Heapy, CEO of Jet2 & Jet2holidays, outlined so vividly at our Annual Conference last week, those organisations which deliver in difficult times, and who demonstrate a clear understanding of who their customers are, will be best placed to establish that vital brand loyalty that leads to a long-term return-on-investment.
Steer the ship with confidence, and your customers will follow
The decisions we make today will shape the future of the UK economy.
While the economic landscape is undoubtably turbulent, the role of service leaders is clearer than ever. Sound judgement, investing in our people, staying focused on customer needs, will together help us navigate this period in a manner that retains customer trust and loyalty, and positions our businesses for further success.
Related Posts
