Agile or irrelevant?
The findings behind CEO Outlook 2019.
The findings behind CEO Outlook 2019.
Seamus Hand, Managing Partner of KPMG in Ireland, gave his thoughts to The Irish Times on KPMG research that provides insights into Irish chief executives attitudes to innovation and embedding a culture of ‘fail-fast” in their organisations.
Irish CEOS are more successful than their global counterparts at embedding a culture of innovation in their organisations. This is one of the key findings of the Irish edition of the 2019 KPMG Global CEO Outlook. The report surveyed 1,300 CEOs in many of the world’s most dynamic organisations, including from Ireland, to discuss how they are confronting long-held market orthodoxies and assumptions that govern decision-making.
The survey found that Irish CEOs have also embraced a fail fast culture in their organisations. Over four fifths (82 percent) of the Irish CEOs surveyed want their employees to feel empowered to innovate and try new things without worrying about negative consequences - a figure similar to their global peers (84 per cent).
However, Irish CEOs were markedly more successful in actually achieving this goal with over three quarters (75 per cent) claiming to have done so while only just over half of global CEOs (56 percent) feel they have similar attitudes in place.
Trying new things and being tolerant of failure is only useful if it’s aligned with the objectives of the business.
“Business leaders are encouraging their teams to try new things and experiment where success isn’t guaranteed and Irish CEOs appear to be successful in embedding the ethos that lessons from failure are valuable in supporting the innovation process”, says KPMG managing partner Seamus Hand.
“This is indicative of the entrepreneurial culture we have in this country now”, he adds. “That’s due to a lot of things but one of them is the nature and diversity of the talent we have here in the Irish economy.”
But there has to be an overall goal in sight. “Trying new things and being tolerant of failure is only useful if it’s aligned with the objectives of the business. If the business isn’t making profits these things don’t matter. It’s about asking how things can be done differently to help the organisation succeed. What you learn from failure and what you do next with that learning is important.”
Saying that such a culture is required is one thing, actually embedding it is quite another. “Every organisation is different”, says Hand. “But a lot of the things people said in the survey resonated with me and the leadership team in KPMG. When trying to embed a culture like this it has to percolate up from the bottom. You have to empower people to challenge the status quo. It’s about using the best resource most of us have, our people, to come up with the ideas and putting in place processes to gather those ideas, evaluate them, and implement them.”
Traditional hierarchical structures and departmental divides may not lend themselves to such a culture, but this doesn’t mean organisations should sweep away tried and trusted approaches. “These historic structures are fundamental to the success to date of many organisations”, Hand notes. “It’s not about tearing things down and building from the ground up all over again. There are different ways of looking at it. It might be possible to do it outside and have external incubators to test and trial the ideas. In other cases, it may be possible to make changes which are less fundamental.”
Leadership is also important. “One of the points that came through the research was in relation to the new type of leadership that companies need. It is changing from traditional siloed roles to much broader ones where a key requirement is greater collaboration.”
The need to be agile was also highlighted. “Agility is primarily the ability to react quickly to changes in customer needs”, Hand explains. “There are many ways for organisations to do this. Cyber is an example. Companies often see this as just something they need to have in place to protect their business, but it can be used as a platform to grow the business as well. Having good cybersecurity systems in place enhances a business’s reputation and helps build trust with customers. It also offers a platform to add more technology solutions to meet the needs of customers.”
Resilience is also important. “It’s almost counter-intuitive but it is not resilience in terms of bouncing back from set-backs or getting through a downturn”, says Hand. “It is about succeeding in times of change and how organisations respond to change.”
Finally, internal disruption is becoming increasingly important. “Successful companies have to constantly challenge themselves and look at ways to disrupt their own businesses”, says Hand. “That’s what their new smaller competitors will do to them, so they have to do it to themselves if they want to remain successful.”
This article originally appeared in The Irish Times and is reproduced here with their kind permission.