We just released our 4th annual Global CEO Outlook, a survey of 1,300 CEOs in 11 of the world's largest economies, which gathers timely insights into their strategic priorities over the next three years.
While they are quite optimistic about the economy at large, and their company's own outlook, they're also realistic about their growth plans in terms of revenue and increases to headcount.
I believe that many CEOs are coming to realize that simple, top-line revenue growth is no longer their sole, or most important, measure of success in the digital era. They are focused on how they can achieve better profitability: investing in technology and their people and looking at different business models.
They recognize that the new business models they pursue will take time to bear fruit. They realize that such transformation may increase value for the company and its stakeholders in other, more sustainable ways than purely immediate revenue gains, such as increased loyalty, relevance or societal impact. And, they must focus on achieving good growth, not just growth at all cost. It's a dilemma that comes with investing in digital transformation.
Several decades ago, the banks invested heavily to roll-out automated banking machines without enjoying an instant, corresponding boost in revenues. It took years for customer behaviors to shift on a large scale, ultimately delivering revenue and cost improvements and forever evolving bank service models from branches to those first self-serve channels.
But embracing this patient approach isn't always easy. Today's CEOs are asking themselves questions such as “What are the right levels of investment to successfully transform our business?”, “What exact skills do we require to leverage new technology?” and “How can we measure our progress, or success, if traditional indicators don't present the full picture?”
Are CEOs up to the challenge?
I was excited to see that seven in ten CEOs say they are taking personal responsibility for leading this transformation, and many have informally appointed themselves 'Chief Digital Officer' or 'Chief Data Protector.' They are embracing technology and eagerly moving data further up the decision process, rather than only at back- or mid-office functions. Global CEOs are making digital a personal crusade.
Over half of the CEOs we spoke with now also identify agility as the new currency of business, and many admit that this can only be achieved through third-party partnerships, investing in start-ups or adopting an incubator mentality internally. They understand that the organizational learning gleaned from these exercises is often more important than short-term financial returns. They also recognize that they must succeed faster, and fail faster, for the long-term health of the business.
While the challenges are ever-changing and often times unfamiliar, based on what we've heard in this survey and the conversations I'm having, CEOs are absolutely up for it.