Tuck Faculty Forecast Business Trends for the Year Ahead

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Adam Kleinbaum

Professor of Leadership and Organizations
Area of expertise: Social networks
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PREDICTIONS:

1. AI will revolutionize people analytics, providing leaders with unprecedented insights into the informal networks within their organizations. By analyzing vast amounts of data from communication patterns, collaboration tools, and social interactions, AI can identify key influencers, bridge gaps in communication, and highlight emerging leaders. This advanced analytics capability will enable effective leaders to be architects of their organizations, designing more effective structures, optimizing team dynamics, and fostering a culture that enables the execution of strategy.
2. The debate over remote work will finally subside, as companies will realize that rigid return-to-office mandates risk losing top talent. The flexibility of hybrid work has proven essential for employee satisfaction and retention. Successful organizations will strategically determine when and between whom in-person collaboration is most beneficial, focusing on tasks requiring creativity, complex problem-solving, and team-building and balancing the needs of today with the needs of tomorrow. By thoughtfully balancing remote and on-site work, these companies will foster a productive and engaged workforce, leveraging the strengths of both environments. Embracing hybrid models will become a hallmark of forward-thinking businesses, leading to greater innovation, agility, employee loyalty, and ultimately, better performance.
3. After spending many millions of Steve Cohen’s dollars, the New York Mets will make a run for Major League Baseball’s World Series. Let’s Go Mets!

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Mark DesJardine

Associate Professor of Business Administration; Harvey H. Bundy III T’68 Faculty Fellow
Area of expertise: Corporate governance and shareholder activism
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PREDICTIONS:

1. Higher Rates of Board Turnover: As activist investors continue to learn to operate under the recently updated universal proxy card (UPC) rules, they will achieve greater success in obtaining one or two board seats on companies. This will cause more “short slate” wins for activists, rather than clearing entire board slates or securing no board representation at all. In turn, companies will be more proactive in forecasting the voting support their directors are likely to receive in shareholder elections and refreshing their boards before activists do.
2. Strategic Shift in Environmental, Social, and Governance (ESG) Issues: Activist investors will intensify their emphasis on ESG factors, but rather than advocate for companies to adopt these practices like they have done in prior years, they will use ESG as a leverage point against companies. With the blowback ESG will continue to experience in the U.S., activists will criticize companies that have focused too narrowly on ESG as being “distracted” from more core strategic and operational matters. 
3. Increased Management Buyouts (MBOs) as a Defense Mechanism: Companies will increasingly pursue MBOs to counter activist pressures and maintain control. 
4. Shift Toward Operational Demands and the Bottom Line: With fluctuating M&A activity and economic uncertainty, activists will focus more on operational and bottom-line improvements in their criticisms against companies, rather than on top line growth. More companies that let their spending go unchecked will get called out by activist investors.

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Sonya Mishra

Assistant Professor of Business Administration
Area of expertise: Gender inequality
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PREDICTION:

In the coming year, I expect organizations to adapt their diversity, equity, and inclusion (DEI) strategies to navigate our shifting political and cultural climate. Many will likely rebrand their DEI strategies as part of broader HR strategies—such as talent management or leadership development—rather than abandoning them altogether. This allows companies to pursue inclusion goals while sidestepping polarizing debates.

Although recent headlines have been highlighting the companies that have rolled back their DEI strategies, it’s also worth remembering that media narratives can distort perceptions. Yes, some companies are scaling back, but others are holding steady or even doubling down. In fact, a recent Nature study shows diversity and inclusion have more public support than most Americans realize. In other words, the national conversation around DEI may shift, but the employees, consumers, and investors who care about these values aren’t going anywhere, and smart businesses know DEI is a competitive edge.

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Scott D. Anthony D’96

Clinical Professor of Business Administration
Area of expertise: Innovation
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PREDICTIONS:

There will be a clear and growing schism between AI leaders and laggards. Accenture estimates that only 20 percent of companies have the systems in place to really benefit from AI, and I suspect that number is an overestimation. And that’s not even the hard part! One estimate is that for every dollar organizations spend on technology, they should expect to spend seven dollars on training and related activities. As my friend and co-author of Eat, Sleep, Innovate Paul Cobban preaches, “nothing changes unless people’s behavior changes.” I expect to see more big moves like the Omnicom-IPG merger in sectors such as accounting, advertising, consulting, and legal services that promise to be radically reconfigured by AI. 
 
More broadly, I suspect that there will be increasing premium on organizations that demonstrate the ability to adapt to change. It is very likely that the most critical events of 2025 are ones that no one sees coming at first (and then are viewed as inevitable and obvious after the fact—such is the nature of change). Organizations that expect the unexpected, develop sensing networks to allow them to spot and interpret weak signals of change and show the ability to react at pace will be best positioned to navigate through the fog of today’s never-ending uncertainty. That paradoxically requires an even deeper connection to purpose and mission that serve as ballast through turbulent waters. We need wise, decisive leaders like never before!

**Scott Anthony’s new book—Epic Disruptions: 11 Innovations that Shaped the Modern World—will be published by Harvard Business Review Press in September 2025.**

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Prasad Vana

Associate Professor of Business Administration
Area of expertise: Marketing and machine learning
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PREDICTION:

We’re at a stage of AI development where it will be cheaper to use certain models, and such applications will find more widespread adoption. This will especially be the case in some expected and some rather unexpected areas. For example, as expected, smaller AI models with limited but useful capabilities will appear in devices with limited computing capacity such as smart appliances. On the unexpected side, AI may find itself more widely used in emerging economies where labor is cheap and human resources (rather than technology) are more widely used for mundane tasks. On the innovative side of the technology, more focus will be placed on multimodal AI. It will become more commonplace for these models to take in as input a combination of text, audio, images, and video and generate such multimodal content back as output.

AI’s use will proliferate for both good and bad in such markets where no regulation exists yet for their use. Neutral organizations must take special care and watch for its use in mass propaganda and surveillance. It will be harder to parse fact from fiction with more accurate sounding generative content. Markets with stronger regulations, such as the E.U., will continue to employ stricter regulations on training data and use cases, bringing to the fore more tensions between government and technology firms.  

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Lauren Xiaoyuan Lu

Professor of Business Administration
Area of expertise: Health care management, retail operations, supply chain management
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PREDICTION:

In 2025, the deployment of generative AI and agentic AI in customer service operations will continue to transform the way businesses interact with their customers. These technologies will enhance customer experiences through faster, more accurate responses while significantly reducing operating costs. However, firms must guard against complacency and address three critical considerations to maximize the benefits of AI integration:

1. As more tasks become automated, companies must find ways to engage human agents meaningfully, ensuring they retain the skills needed to handle complex or nuanced customer interactions. 
2. The design of hybrid roles combining AI’s efficiency with human empathy and judgment will be key. Such roles should empower employees to better serve customer needs and further improve customer experiences, especially in situations requiring creativity or personalized solutions.
3. Firms must prioritize retaining and developing top talent to sustain innovation in customer service and prevent stagnation in AI performance.

By striking the right balance between automation and human expertise, organizations can position themselves to thrive in the rapidly evolving landscape of AI-powered customer service.

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Paul Argenti

Professor of Corporate Communications
Area of expertise: Corporate communication
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PREDICTIONS:

1. We have seen lots of companies cozying up to the Trump administration, especially in the tech sphere. We also know that younger employees want their companies to speak out on key social issues. How are these companies going to balance those two things: A shift to the right to catch the wind blowing in that direction versus the needs of young, idealistic employees who see business as the answer to society’s problems? It’s going to be a rough ride.
2. It is going to get increasingly difficult for people to wean themselves off AI/ChatGPT and try to become creative to solve most communication problems. Yes, it is amazing what AI can do for your writing, research, and even to help with your thinking, but it cannot replace the innovative nature of humans and their ability to confront ambiguity with entrepreneurial ideas. So, proceed with caution and avoid overreliance on these tools.
3. We see so many companies backing off positions related to DEI; how will that affect their trust and transparency? Is that who they were all along? Organizations will need to work harder to prove their authenticity and integrity by providing evidence-based communications and being transparent about their practices. And these must be in line with their strategy.
4. Companies are going to be increasingly challenged on their interest in getting everyone back to the workplace. In the end, I’m not sure how you create a coherent culture without consistent face time, but employees like the freedom of working from home and managing their own schedules. Is there a way to negotiate this for everyone? One way would be to trust employees to get their jobs done how and when they want to do them. That would include the importance of some face to face, but not a maniacal or tyrannical approach to when and where that will all happen.

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Dean Alderucci

Visiting Professor
Area of expertise: Corporate AI strategy, machine learning and natural language processing, innovation strategy, technology law and policy
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PREDICTIONS:

In 2025 many firms will realize they have to rethink their AI strategy. Specifically, as many firms confront the looming performance ceilings of their existing AI approach, they will search for new strategic directions.

Today many firms have already undertaken the first steps in AI adoption. They have become accustomed to using chatbots and other Generative AI tools for numerous productive purposes, including both small pilot projects and AI systems deployed at scale. These experiences have made firms comfortable with basic AI capabilities and honed their AI skills. More experienced firms have also begun the transition to the next level of AI: autonomous agents. 

However, many firms will relatively quickly exhaust the low hanging fruit from off-the-shelf AI products. The easy productivity gains from available AI systems are, in some cases, quite valuable. However, these products will be used by firms and their competitors, affording no clear competitive advantage. More importantly, firms will not find third party AI tools that perfectly match many of the specialized tasks that drive firm value. No off-the-shelf AI tool will perfectly align with the specific ways that a firm in a given industry identifies potential customers, manages its operations, strengthens its brand, or drives customer loyalty. 

This gap between general-purpose AI capabilities and a firm’s unique needs will lead to suboptimal results. This gap will be particularly evident in tasks demanding highly specialized knowledge, nuanced reasoning, or deep domain expertise.

Increasingly, firms will recognize the need to move beyond relying exclusively on the tools of external AI providers. They will proactively invest in tailoring AI solutions to their specific operational, organizational, and industry contexts. If executed well, this early adoption of customized AI will ultimately confer a significant competitive advantage.