Two years ago, a new phenomenon was dominating the minds of CxOs the world over. One executive from the US transportation industry described it succinctly as: “The ‘Uber syndrome’ — where a competitor with a completely different business model enters your industry and flattens you.” Many other business leaders professed the same fear — that new rivals from outside their industry could easily turn their companies into roadkill.
Today, the sentiment is moving in the opposite direction. Despite traditional industry boundaries continuing to erode in the face of digital disruption, CxOs are saying that future competition is more likely to come from within their own industry.
Business trends change constantly, and executives need to remain well-informed, well-prepared and extremely agile. That’s why the IBM Institute for Business Value (IBV) created the Global C-suite Study program. We’ll publish the full set of results from our latest research in early 2018. But we don’t want executives to wait a year for information that could be vitally important to business today. Throughout 2017 we will release interesting — and sometimes unexpected — insights through monthly blog posts and more detailed quarterly reports.
CxOs’ shifting perspective on competition was the first major change that emerged as we compared new data to 2015 findings. Then, CxOs said they were prioritizing the development of new markets and territories instead of trying to grow existing ones. And they were looking to external partners for sources of innovation rather than their own internal capabilities.
By contrast, it seems that today’s CxOs are starting to get a grip on the threat of industry convergence. According to early data, which includes input from about 1,880 executives globally, CxOs are moving away from knee-jerk reactions. They are turning toward more methodical, considered approaches. They are carefully defining their go-to-market strategies while reassessing with whom they go to market. Instead of focusing on new, unproven markets in the search for growth, they’re looking to find a more even balance.
In what might be an encouraging sign for research and development investment, executives say they expect more innovation to come from within their businesses in the near future. It’s unclear whether this shift in CxOs’ mindsets is driven by internal financial and operational constraints, or reflects external factors such as increasing geopolitical uncertainty, the elimination of free-trade agreements or a tightening in the regulatory environment.
Why did executives reverse their opinions so quickly? Was the threat from digital invaders overblown, or was it just a matter of time before industry incumbents began to reassert themselves? We’ll continue to explore business leaders’ response to change in our future monthly insights and reports. Stay tuned!
This blog is the first in a series of monthly insights that highlight preliminary findings and emerging trends from our 19th Global C-suite Study. The study is based on interviews with more than 10,000 CxOs.