It’s been one hell of a year.
One where we’ve all needed to be resilient, personally and professionally.
As a company of close-knit team members, our resilience is defined by the care we demonstrate for each other, our families, the organization, and our clients.
Not all entrepreneurial businesses can make those claims, but we’re proud of them every day.
When we rate companies for our clients—and for network members looking to become visible through their ratings—we are facilitating collaboration, stronger business relationships, and a better understanding between business partners. We are—in a sense—actively sponsoring global financial health.
Because, resiliency is an active state. One that requires something of all of us.
Yes, it’s been one hell of a year, and even though it’s easy to enumerate the calamities, pain, and paralyzation throughout the world—progress is measured by movement, not paralysis, and true resilience is both equal parts responsibility and opportunity.
Here are some of our perspectives for the year ahead.
Meaningful Relationships Will Matter More Than Ever
Sherisse Thomas (Director, Human Resources / Director, Diversity & Inclusion)
2020 has been as unpredictable a year as they come.
Which makes putting forth a prediction for 2021 all the more interesting. That said, for businesses throughout the world—of every size and across every industry—this past year has been anything but business as usual; and in many respects, we'll never return to that same business as usual (which is also a good thing, in many ways).
This year especially, we've learned the importance—and absolute necessity—of a resilient and agile workforce. We've come to terms with the fact that employees can be just as productive (& sometimes more productive) working from home, and we find ourselves proactively taking stock of how we're doing as a company, not only company performance-wise and efficiency-wise, but in terms of the employee experience as well.
With this in mind—my prediction for 2021 is that the discourse around diversity, equity and inclusion will continue to build and become as much a part of the conversation around employee experience and our ability to retain talent and attract new talent, as it’s been this past year in terms of innovation and the increasing expectation (internally and externally) to ensure diverse workforces—from Board level, all the way down.
I believe we’ll continue to see that diversity, equity and inclusion will remain at the top of companies’ priority lists; not as a ‘nice to have’ or a ‘box to tick’ but as an opportunity to be better and do better when it comes to diversity and inclusion in our workplaces. Because when it comes to D+I, corporately and societally, there is no "done"—just a commitment to be "better".
Vipin Shri (Senior Manager, Marketing)
In a time when physical solitude has matched the emotional solitude we've collectively been facing as a society—due to technology, the political environment, and the pandemic—I believe that 2021 will be the year that organizations with EQ will begin leading us towards more human-centric approaches to building technology. (Approaches that will balance efficiency with both equity and empathy.)
The past year has provided so many lessons, 2021 will be the quiz we all need to pass.
Marci DiGaetano (Director, Inside Sales)
For all intents and purposes, the success of businesses in the near and medium terms will rely on tried and true tactics that are as old as commerce itself: the power of conversations and the ability to operate together. Risk—of any type (credit, supply chain, cybersecurity, geopolitical et al)—can only be truly managed by finding opportunities in the bad news. Next year will continue to bring bad news to the fore. And you can only find those opportunities by talking to each other.
Danny Lane (UI Designer)
In 2021, I predict that in a new (post-COVID) normal, businesses will be more focused on building stronger relationships with their suppliers through the adoption of technology, which will spark engagement for more collaboration and transparency in their supply chain process.
Supply Chains Will Continue to Be Tested and Strengthened
Adam Mahrez (Senior Associate, Data Analysis)
In 2021, I predict that businesses will slowly begin recovering financially from the pandemic starting with improving liquidity levels and increasing demand. Supply chains will grow stronger by doing so, led by more meaningful and efficiency-seeking collaboration. The driving factor being complete transparency to help mitigate potential risk and further relationships between already financially stable businesses.
Brad Silberberg (Director, Network Sales)
Supply chain disruptions caused by COVID will continue into 2021—until vaccines are distributed to most of the population and herd immunity is achieved. Risk will remain high throughout 2021 and top businesses will become more resilient to supply chain issues and disruptions because of their experiences in 2020. This past year has taught companies to get in front of potential supply chain disruptions, and these learnings will carry through to 2021 and forward.
Steve Lunde (Network Outreach Supervisor)
I predict that enterprise clients will need to spend more time not only assessing supply chain risk, but also taking tangible actions to support their suppliers during this extended time of uncertainty. It is important to help suppliers understand the need for transparency in reporting financial positions to clients, but consequently, clients should take note that the support should be reciprocal.
Zach Guglielmo (Account Executive)
Companies will look to bring in more domestic suppliers; supplier payment data will be inaccurate and out of whack due to flexed terms; and tier-two's will need to be part of your supplier assessments.
Ari Goldstein (Account Executive)
Given the fresh impact of COVID-related supply chain disruptions, businesses will take a more proactive approach to supplier and vendor risk.
More businesses will build out dedicated cross-functional teams focused on predicting and avoiding exposure within their supply chains. These roles will be filled by internal members as well as graduates from programs specialized in building out strong processes to reduce risk.
Global Trade Will Remain in Flux
Douglas Cameron (President & Co-Head of Product)
COVID has permanently shocked sophisticated manufacturing and awoken them to the importance of better risk management. This will not fade away.
Meanwhile, China's hold over its populace is tenuous; its behavior towards its neighbors and its trade partners is the primary way that the government shows power/progress to its people. Unfortunately, they have over-stepped this and as a result, sophisticated manufacturing will have leverage over its Chinese suppliers to continue to embrace transparency.
I also predict that global counterparties are going to want to find ways to demonstrate their strengths in order to maintain and secure new business.
Tim Wilks (Account Director)
Given the fractures in global trade due to the geopolitical climate (US politics, US-China-EU friction, etc.) and the Covid-19 pandemic, we’re going to be hearing a lot about “supply chains” in 2021. The global COVID vaccine supply (cold) chain will be critical in 2021. We all see more danger and risk around these chains and those involved in managing that risk will do well in the coming year.
Brad Saegesser (Senior Solutions Specialist)
I predict that Commercial & Industrial loan activity at FDIC insured commercial banks will increase to above pre-pandemic levels, ending the year with more than $2.4 trillion in outstanding balances. Not counting pre-pandemic line utilization in Q1 2020 and PPP loans in Q2 2020, C&I lending peaked in mid-2019 at around $2.2 trillion.
We will see $200 billion in new C&I loan originations in 2021.
Kyle Barnett (Finance Analyst)
Even with the success of vaccines, I anticipate that the economic impacts of this pandemic will remain for many months to come—and by this time next year, defaults and bankruptcies will be rampant.
For those companies that weren't so unlucky, a vast majority will have merely 'weathered the storm' of COVID and have barely made it through without falling into this category. These companies will need to put major emphasis on re-strategizing their corporate goals in order to return to profitability or even just to limit a going concern. (They should already be doing this as it is a very real risk even for those who haven't suffered major losses of yet.)
As a result, it becomes more critical than ever that they understand where their suppliers, customers, or third parties (with which they share a mutual reliance) stand in terms of their financial health. It's more important, now than ever, to have key financial insights into your entire company's supply chain and third-party network in order to ensure your current survival and future recovery.
Dylan Dao (Senior Associate, Analytics)
I predict that US Oil and Gas companies will continue to experience financial stress during the first half of the year and the overall Financial Health of the industry will continue to deteriorate. However, by the end of the year, the industry should be on a better path to recovery as the US economy continues to recover from the pandemic.
Brian Smith (Client Success Manager)
I expect 2021 to start off as a continuation of 2020. The country will still be in the grips of a pandemic for the first half of the year. Consumer demand and GDP will underperform during the first six months of the year. This should keep CPI and PPI in relatively low narrow bands. I expect CPI to end 2021 at 2.0% - 2.25 and PPI at 2.1% - 2.3%.
The second half of 2021 will see strong growth due to pent-up consumer demand. I see the S&P 500 breaking 4,000 to close at 4,150. GDP will end strong with a 3.8% for the full year. Oil will slowly increase as economies restart and oil will be at $75 at the close of 2021. I expect the yield on the 10-year note to slowly rise to 1.35% at year’s end.
Pete Tantillo (Chief Financial Officer & Chief Operating Officer)
Industry-wise, we will continue to see retailers that haven’t adopted a more robust e-commerce strategy continue to suffer, as they have too much invested in bricks and mortar; vaccines won’t get fully rolled out until well into Q3, thus dampening the hospitality and aviation sectors.
From a corporate view, we will likely see more companies continuing to allow flexibility in their work force in 2021. So expect this trend to continue to depress the office and business travel markets for the full year of 2021, with some rebound (but not to prior levels) in 2022.
There will also be more of a push for diversity and inclusion, as an example, Nasdaq has requested changes that will require a company to have a diverse board makeup in order to be listed on their exchange.
The Genie is Out of The (Corporate Life) Bottle
Maren Costello (Regional Head, People & Culture)
I predict that businesses around the world remain on course for digital transformation. All organizations will accelerate their use of digital technologies, transforming existing business processes to drive customer engagement, employee productivity, and business resiliency. Internally, organizations will fast-track transformation programs to future-proof their businesses, invest heavily in digitalizing employee experience and therewith transforming the relationship between employers and employees.
Vanesa Divkovic (Managing Director, Client Success)
As global businesses evolve in a post-COVID world, my prediction is for a lot of consolidation, restructuring and M&A activity. My instinct is telling me that the stronger companies that have survived through COVID are well-placed to take advantage of struggling businesses, thus I see a lot of opportunistic acquisitions of distressed assets.
Separately, in terms of the risk distributions across our FHR® universe, the average FHR® will begin to shift downwards as we see more companies account for COVID impacts in their financial statements. We have seen many companies expense the government PPP loans which means they take a hit on operating profits, and also record the PPP loan as debt. Both have a negative impact to the FHR®, albeit (and in reality) these loans will likely be forgive—so perhaps unduly heightening some companies as high risk. It's something to look out for or at least talk about in terms of the changing FHR® landscape as companies report on COVID in financials.
Janet Ou (Client Success Manager)
All essential workers will have been vaccinated; businesses will be better prepared to mitigate their supply chain risk in the face of the ongoing pandemic; and offices will open-up in second half of the year.
Gerard Keating (Engineering Manager)
I predict that the office workplace will change forever and this will have big repercussions for cities, countries and society. Goldman Sachs are looking at moving offices out of New York to Florida, Hewlett-Packard Enterprise moving to Houston and Palantir to Denver, among others. Google and Facebook, and the rest of the FAANG group, have all made statements about allowing their workers to continue to work from home. This will have profound effects on city planning and state and government policies. If you can work from anywhere, then you can live anywhere—so places will have to entice people to move there.
Nitin Walia (Chief Client Officer)
The shift to more flexible workplaces is here to stay.
While most businesses will maintain robust physical offices to support collaboration and culture, the pandemic has demonstrated how resilient and effective professionals can be while working remotely, and sometimes with unusual hours.
There will be countless knock-on effects from this: for one, IT and information security groups will be busier than ever, as they look to deploy new technology to ensure that remote work does not compromise security. This may also accelerate a shift away from traditionally expensive cities like New York and San Francisco to more affordable locations elsewhere in the world.
Indeed, consider recent reports that Goldman is considering shifting its storied GSAM unit to Florida.
Bonus (Information Security)
Nate Masterson (Associate Director, IT)
I believe there will be a shift in the mindset of business leaders to more broadly accept permanent WFH as an option for all employees. I think that the efficacy and effectiveness of information security controls while remote, which is one of the largest concerns with WFH, will greatly increase as the demand for robust solutions continues to increase. I think this has been a slowly (growing) trend that the events of 2020 have catapulted into the limelight, and now we're seeing how bright employees can shine while working from home.
Maxwell Gordon (Graphic & Web Design Manager)
If you were a kid in the 80s and 90s—2021 will be a year of nostalgia in the world of graphic design. In 2020, designers brought back retro-style illustrations and patterns, serif fonts, and early web aesthetics (brutalism). 2021 will continue to explore those themes and push them into a modern context (with typography being a main focus). Since this has been a year unlike any other, we might as well revisit the best designs from simpler times.
Eric Evans (Managing Director, Business Development)
Companies that have complex supply chains with a high number of suppliers will lean-in by leveraging supplier networks like Ariba, Coupa, Jaggaer, Trust Your Supplier, GEP, and Beroe to enable supplier onboarding and monitoring—more efficient and easier.
Kevin Burt (Account Executive)
It is my belief that we will continue to see increased levels of interest in API integrations throughout 2021. Virtually every company we speak with, both clients and prospects, have migrated away from homegrown systems and work with various third-party GRC providers.
As the importance of risk management stays elevated throughout 2021, there will be a desire to have more data across various risk categories. It will be important for companies to look to bring it all together into a common place, resulting in increased levels of efficiency in understanding and interpreting a 360-degree view of risk.
All opinions expressed by our contributors are their own, personal opinions and don't necessarily reflect the views of RapidRatings as a company. All content is provided "as is" and "as available" without any guarantees as to the accuracy of the content. All content is owned by RapidRatings and therefore cannot be copied, distributed, or re-purposed without prior consent. If the content contains any forward-looking statements, actual developments of results could differ materially from those projected and content should not be taken as a substitute for a financial adviser or investor's independent assessment or advice.