When we look at the results of this year’s CEO Outlook survey, it’s no surprise to see digital investment coming through front and centre as a boardroom priority. Nearly three-quarters of UK CEOs say they have an aggressive digital investment strategy designed to secure first-mover or fast-follower status.
Looking into the detail, five points stand out for me:
58 percent of CEOs are prioritising investing in technology over developing their workforce’s skills (42 percent).
This doesn’t surprise me, even if the gap is narrowing (in 2020 it was 65 percent vs 35 percent). Over the past 18 months, digital transformation has accelerated hugely. Organisations have needed to fix foundational things like moving to the cloud, implementing base security requirements and integrating collaboration tools.
But to do this properly, and really enable the workforce to be effective, more of these tools and technologies are needed than many businesses initially realised. New software, new hardware and more sophisticated collaboration platforms may all be needed. So, the job is not done yet and significant investment is still required.
Half of CEOs say investing in digital training and skills will be a key success factor in a hybrid world.
Digital narrowly ‘wins out’ over people in terms of driving growth, but of course it’s only a qualified victory. It’s people who use the technology and unleash the benefits for the organisation. That makes training and upskilling essential. New approaches are needed here – moving away from formal training sessions to an approach of continuous learning and development.
At KPMG, we have a concept of ‘digital ninjas’ – digital natives (including all of our graduates) who help colleagues use new technology tools and skills in their everyday work. The results are fantastic and energising. A new breed of digital talent is helping everyone become digitally enabled. So, in a very real way, people are the key to making technology work for a business.
Three-quarters of CEOs intend to increase investment in disruption detection and innovation processes to achieve growth.
You’re investing in digital, and you’re upskilling and supporting your people – but how do you keep at the forefront of innovation when business models get disrupted so quickly? It’s a critical question that’s preoccupying CEOs. There’s a realisation that you have to be constantly looking around the corner, horizon-scanning for what’s coming next. Many are grappling with how to actually go about it. We’re certainly seeing enormous demand to run innovation challenge sessions with clients through KPMG Ignition.
There are lots of components needed for successful innovation – but a really critical element is diversity of thinking. This means reaching out beyond your own business – you can’t innovate just by thinking from within. You need to access the wider ecosystem. That means working with tech businesses, start-ups, and other organisations. Almost three-fifths of CEOs are joining industry consortia and nearly half are collaborating or partnering with start-ups or third-party data providers.
You’ve got to look outside your own sector too. Sectors are converging after all – you can learn from anyone.
Four-fifths of CEOs recognise that protecting their partner ecosystem and supply chain is as important as building their own cyber defences.
It’s great to talk about all the positives and possibilities of digital transformation – but cyber security has to be an absolute priority too. In fact, it’s probably number one or two on the priority list of any CEO I talk to. And it goes much wider than the perimeter walls of your own business.
The realisation has really grown through the pandemic that it’s simply essential to protect against supply chain risks. You need resilience right across the value chain. Organisations have to be able to identify threats early and respond to them rapidly. They also need to model the what-ifs and how they would keep running operationally in various scenarios.