We have come a long way from the early days of the Internet and the world has witnessed a transformation at unprecedented levels. However, the way to the future is not always clear. As winner-takes-all organizations rise, an ecosystem of collaboration is flourishing as well. Organizations are not lying in wait for the ‘next big thing’. They are looking to reinvent and champion change even as they recognize that the status quo is working well.
In this third cross-C-suite Study and the 19th edition in the ongoing series of CxO studies, the IBM Institute for Business Value (IBV) presents its key findings of CxO insights, experiences, and sentiments about the future of the industry and the landscape as it evolves. The C-suite is evenly divided on whether the focus will shift in the future from established market or new ones. They observed that there is a retreat to emphasis on proprietary innovation rather than those sourced externally. Yet, they also note that there is increased space for collaborative innovation.
Through a cluster analysis of the participants of the study, three archetypes or organization emerged as represented in the infograph.
Based on responses to the survey and engagement with clients and academicians, the 19th edition of the IBM Global C-suite Study covers four important topics that stand out today.
Dancing with disruption – Incumbents hit their stride
Executives surveyed do not foresee any immediate impact on their business. Rather than fearing the digital giants, they are most concerned about the industry incumbents. This is in contradiction to the deluge that many had predicted would come with ‘uberization of everything’.Incumbents honed their skills to acquire nascent disruptors, along with their digital skills, and innovator talent. The organization that weathered the storm of disruption have grown stronger and are keen on reinventing themselves.This signals that disruption has emerged as a capability that incumbents have embraced. It is no longer the province of the hungry upstart.
Trust in the journey – The path to personalization
While it seems that while most organizations are chasing after that cherished customer experience, the question that lays before most of them is whether they are running in the right direction.The Reinventors, as design thinkers, are leading the way in bridging this disconnect by valuing customer co-creation. They continuously integrate customer feedback into their planning and design process. They are also effective at detailing customer journey maps to draw rich sources of data to decompose customer journey and uncover root issues and pain points.
Orchestrating the future – Pull of platform business models
The lure of platform business models has spared few. Platform orchestrators, on average, grow revenues faster generate higher profits than other business models, earning valuations as high as eight times revenue. Attracted by this potential, executives surveyed report their enterprise is reallocating some portion of its capital to build platforms. Past and future reallocation could approach an estimated USD 1.2 trillion in the next few years.The Reinventors are currently leading adoption of platform business models, however, the Practitioners are fast catching up.
Innovation in motion – Agility for the enterprise
With great challenges ahead of them, organizations are continuously innovating while maintaining their leadership and current operations. There is a rising call for ‘reflection in action’ – to learn as they execute. CEOs of Reinventor organizationsstood out from others in one respect. Although, they too prized experimentation and empowerment, more of them attributed their current success to learning to think in more agile and flexible ways. In turn, the Reinventors have designed their operations and organizational cultures to embody this flexibility of vision. They make it clear that they value smart experimentation and rapid response to market changes.
Strengthening advantage: Actions to take now
Reinvention never ends. As new opportunities – some of them disruptive – emerge, the organizations that remain open to change can orchestrate advantage.
In broad strokes, these include new trusted bonds with customers, new ventures to scale on platforms, and more nimble teams.
Read the full report to understand the actions organizations must consider to uncover their next advantage by interrogating their environment; committing with frequency; and experimenting deliberately.