Economic confidence has returned to pre-pandemic levels and CEOs are seizing the opportunity by prioritizing new digital technologies and revenue streams to transform their businesses.
People and digital, together
Having steered their organizations through the rapid switch to remote first communications at the onset of pandemic, enabling employees, customers, suppliers and partners to stay connected, CEOs are expected to maintain the pace of this digital transformation. But it’s also important to align on what “digital transformation” means. While increased use of modern technology is at its core, digital transformation comes down to improving the experience and efficiencies of people. And not just any people, but their people - their employees.
When thinking about their growth and transformation objectives, CEOs have placed a stronger focus on buying new technology instead of developing their employees’ skills over the last 18 months. But this gap is narrowing according to our recent KPMG CEO Outlook, with many CEOs recognizing that developing talent is vital for growth.
- 60 percent of CEOs say they’re “placing more capital investment in buying new technology” (67 percent in Jan/ Feb 2020)
- 40 percent of CEOs say they’re “placing more capital investment in developing our workforce’s skills and capabilities” (33 percent in Jan/ Feb 2020)
The faster, the better
After leaning heavily on digital methods to conduct day-to-day tasks over the last 18 months, business, customers, employees and stakeholders all have higher expectations for technology coming out of the pandemic— and that’s not going to change any time soon. They expect instant responsiveness and a consistent, seamless digital experience, so CEOs are aware of the demand to build up and scale their organizations’ digital capabilities.
- 78 percent of CEOs say “we need to be quicker to shift investment to digital opportunities and divest businesses that face digital obsolescence”
- 75 percent of CEOs have an aggressive digital investment strategy, intended to secure first-mover or fast-follower status
- 67 percent of CEOs are looking to get on the front foot when it comes to disruption and innovation, indicating they will increase investment in disruption detection and innovation processes.
What’s the best way to determine the right speed and scope of digital transformation post-pandemic? Do it fast. The faster the better. The days of projects lasting 2 years won’t cut it anymore.
Many of the CEOs I’m speaking with have shifted to a cloud-first mindset, because it offers rapid scale and faster implementation. That echoes the views of our survey respondents, with half (50 percent) saying that they intend to partner with a third-party cloud technology partner in the next 3 years in pursuit of their growth objectives.
The pandemic has changed the digital race for many businesses. Here are three tips on how you can join in:
1. Advance the digitization and connectivity of all functional areas across your business: This was the top operational priority named by CEOs in order to achieve their growth objectives over the next 3 years. I couldn’t agree more.
2. Make resilience part of your business DNA: In the wake of COVID-19, businesses have doubled down on their investments and reliance on technology. While this drives greater agility and efficiency, it has also increased the related risks. For example, cyber threats and hacking are increasing in number and severity — and this risk will not be going away anytime soon.
3. Be proactive: Rather than waiting to be disrupted by competitors, CEOs told us that they are actively disrupting the sector in which they operate. This went from 61 to 72 percent in the last 18 months.
High-performing organizations are those that can flex their technology and people ‘muscles’ as needed. The result is a highly skilled, digitally enabled workforce which operates with speed and agility. They’re the ones who will get to the podium before others can see the finish line on the horizon.