Money Follows Value. It Also Follows Values.
September 15, 2023
Americans dramatically changed their spending habits in 2020. In response to COVID-19, both consumers and businesses alike made on-the-fly money moves that are likely to have long-term influence on the way budgets are set and managed in the future.
Only some of that influence will be related to dollars and cents; a lot more of it will come from a fundamental awakening (or reawakening) of certain values.
Among the many surprises encountered over the past year is the number of entrepreneurs willing to hang out their shingle. Now. During one of the most economically, socially and culturally tumultuous periods in history.
To the risk averse, this may seem like a poorly calculated move. But to an entrepreneur with an eagle eye for opportunity, now feels like exactly the right time to launch a new venture. These visionaries appear to be in good company. There were nearly 1.6 million new business applications filed in Q3 2020. That’s an 80-percent increase over the 860,000 filed in Q3 2019.
Of those new and young businesses consulting with Bank Iowa, many of them are placing a high priority on efficiency and effectiveness. Although one could argue business owners have always placed a high value on these capabilities, it can be argued back that business owners have never been quite this zealous about achieving them. Industrialists are more willing now than ever before to assign lines in the budget to the pursuit of efficiency and effectiveness.
They say, money follows value. But, it also follows values. As the economic, social and cultural impact of the pandemic comes into clearer view, expect to see changes in the way people allocate their money in alignment with newly discovered or rediscovered values.
For instance, a small business with under 10 employees now considers direct deposit payroll a must. Why? Because making sure employees are paid on time, every time, no matter what Black Swan event threatens to disrupt payday, is a sure way (not to mention, an efficient way) to cultivate an effective workforce. Happy employees means a better experience for customers. Money follows values.
It can be seen in the consumer space, as well. Expenses that may have seemed over-the-top or unnecessary pre-COVID are becoming much more palatable… if they make life more efficient or personal pursuits more effective.
Efficiency and effectiveness can be achieved in all kinds of ways. Iowans seem to have a strong, innate sense that neither can be achieved without empathy, compassion and meaningful support for the people who will bring them about.
Observations around the rising values of efficiency and effectiveness are merely anecdotal for now. This very well may be the precipice of values-centric budgeting like it’s not been seen before.