David Poole, CEO
So, how’s the new decade going so far? Not as planned, I don’t imagine – but that is sort of the point. Without wanting to immediately mention a certain pandemic, one of the messages I want to hammer home is that things rarely ever go according to plan – and a good business strategy is one that accounts for that inevitability. A famously wry phrase comes to mind: “the best-laid plans of mice and men often go awry.”
Pandemic aside, Brexit is still up in the air, a potential recession is dawning, climate crises loom, and in the financial industry, regulatory shifts such as IR35 and the transition away from LIBOR threaten to wreak havoc on contracts and risk management. The difficult act of leading and scaling a successful business over the coming decade means staying one step ahead, not only of the competition, but of the next major catastrophe too.
Business leaders may be forgiven this time around for being unprepared. The same cannot be said, however, for a second wave of the pandemic. Or for the effects of climate crises on supply chains, or for shifts in outsourcing patterns, consumer demands and workforce requirements. These are all elements that should now be factoring into executives’ long-term visions.
The key is to build the capacity to adapt swiftly. Resilience must replace raw efficiency as the modus operandi of modern businesses. Much like the economy itself, companies can no longer keep pouring all profits into further growth, and cannot continue to work with zero-margin-for-error supply chains. Contingency planning is essential. When the roadmap drastically changes, how resilient and adaptable is your business? How do you transition from short-term survival tactics to the long-term future-proofing of your organisation?
Overcoming ‘analysis paralysis’
Evidence suggests that the majority of executives are not sufficiently championing innovation. 65 percent of the senior executives surveyed by McKinsey were only “somewhat,” “a little,” or “not at all” confident about the decisions they made in this area. Another Deloitte survey reveals that less than half of executives are confident in their own ability to lead their organisation in the digital economy.
The businesses they are leading share this lack of confidence: a report from MIT Sloan found that less than 10% of respondents believe their organizations have leaders with the right skills to thrive in the digital economy.
Corporate leadership must be redefined to lay the foundation for a future-ready working culture. Executives need to set an example, because studies show that when they do, sustained innovation follows. McKinsey’s sample of 600 managers and professionals suggested that the top two motivators of behavior to promote innovation are strong leaders who encourage it and top executives who drive it.
Faced with a plethora of different technologies and possible strategic paths, however, executives could be forgiven for feeling paralysed by choice. Intelligent automation, Robotic Process Automation (RPA), Natural Language Processing (NLP), Machine Learning (ML), and Optical Character Recognition (OCR) are just some of those on offer, and each comes with a slew of media hype. Do senior decision-makers understand these technologies and the opportunities and risks that they present?
At Emergence, our mission is to help business leaders gain the clarity they need, to build strategies that reconcile short-term gains with long-term ambitions, and to build the resilience required to stay adaptable to challenges presented along the way.
Embracing technology should be a huge part of any business’ plans. This doesn’t mean welcoming new tools hurriedly, uncritically and with open arms; it means diagnosing your pain points and defining a technological vision that will benefit your company and its stakeholders in profound ways. To quote IMD innovation professor Bill Fischer, true innovation comes from mindset, not hardware.
