Transform or get left behind. The business agenda for a new era.
In this fast paced, digital and data driven era, firms are adjusting to the challenges of disruption and are increasingly looking to different sectors for fresh perspectives. Change is everywhere and companies need leaders who can think outside the box and respond to a variety of looming threats and, as yet, barely imagined opportunities.
Rapid Change and Talent Challenges
The geopolitical backdrop of Brexit, and Trump’s govern-by-Tweet approach to administration, only serve to exacerbate the current headaches of business leaders. Even companies supposedly ahead of the game worry about future regulation or how to keep a large Millennial workforce happy.
Businesses are changing at a more rapid pace since the early 20th century but the signs for Ireland are good. The diverse mix of sectors means the country is a hotbed for transformational talent. Backgrounds are varied and span disciplines such as technology, operations, strategy, finance, and engineering. The Irish diaspora also provides a rich seam of senior professionals with best practice knowledge and experience from across the globe.
There have already been well publicized initiatives, such as Bank of Ireland’s €500m investment in a new IT platform and Vodafone’s €120m programme to bring various customer platforms together. Other significant programmes are happening under the radar to ensure businesses will go the way of Microsoft instead of Blackberry.
The CEO of a major US utility, quoted in a recent Q&A, said, “I like to think of the utility business as really being a technology company that happens to deliver electricity and gas.” Other forward-thinking CEO’s across other sectors have expressed similar sentiments. Whilst digital disruption hogs the headlines, business transformation can be driven by many issues such as regulatory pressure, strategic cost reduction, customer pressure or business process improvement. It can be both evolutionary and revolutionary, with General Electric’s repositioning as a digital industrial company a good example of the latter. Whatever the end goal, firms are waking up to the fact that they cannot rely solely on their internal talent pool or poaching staff from the immediate competition. Instead, their leaders should be drawn from varied backgrounds, industries and markets, who can bring fresh insight to new challenges.
Banks, for example, are in change-or-die mode, with disruptors of varying descriptions promising a simplified product and seamless customer experience. Whilst the Irish market is yet to be affected, the UK banking market is rife with ‘challengers’, such as Starling Bank, who offer a stripped down, online service. Regulation, in the form on the GDPR and PSD2, is only increasing the fears of banking executives that a technology firm will enter the market with a true game-changer. In response, banks are partnering with fintechs and making senior hires from a range of sectors in order to future-proof their business models.
New Tech Customer Engagement
Utility and transport companies have traditionally scored low in terms of customer experience, with many trying to catch up in terms of how they use digital to interact with customers. However, smart technology and the Internet of Things provides companies with enormous potential in terms of digitizing across the whole value-chain. A report by Willis states how “the explosion of data and intelligence resulting from this connectivity could drive more efficient operations and more accurate decision-making.”
The Amazon Factor
The challenges for sectors such as FMCG, Retail and Manufacturing are often more geared towards supply chain, systems & processes and finance transformation. However, as more customers (both B2B and B2C) demand seamless and curated online journeys, the pressure is on to embark on large scale transformation before disruptors such as Amazon, who recently made a self-financing acquisition in the US food industry, begin to circle.
Whilst Brexit will affect all sectors, the food and financial services industry are expected to see the most change. Food companies stand to lose a significant export market so need to explore other avenues or even new business models. For many financial services firms passporting products to the EU from a London base, the uncertainty around hard or soft Brexit means they will have to explore numerous possibilities and be nimble enough to adapt quickly when the future becomes clearer.
What is for sure is that the winners will emerge from companies whose visionary leaders see transformation as a continuous opportunity rather than a headache. Engaging staff to stay on the journey is a different matter…