Globally, as well as in India, organisations are operating in complex and dynamic economic environments. Evolving regulations, highly demanding customers with a variety of needs, slowdown in traditional markets, advances in technology and rise of non-traditional competitors are some of the key issues CXOs have to deal with simultaneously. Therefore, it comes as little surprise that organisations are seeking solutions to manage such complexities and effectively navigate various operational/internal struggles that they face on their growth path. Today, transformation is key to organisational success.
Not surprisingly KPMG’s India CEO Outlook 2017 survey stated that 54% CEOs are ‘more than likely’ to transform their organisations into a significantly different entity.
The underlying objective of business transformation is to build a strong foundation for growth. It is a seamless combination of defining a clear and aligned strategy, building a scalable organisation, processes, systems, governance, and relentless execution of new foundations across one’s business. This not just enhances the likelihood of future success, but also in the near term allows an organisation to perform better, generate higher profits, deliver on goals and achieve an increased bottom line.
The need for transformation is crucial as there are multiple players in the market competing for customer attention and loyalty, and they take up the biggest pie of the profit. Increasing consumer touchpoints and evolving customer engagement channels mean that strategies of the past may not work in the present. Corporate leaders have no choice but to adapt, reinvent and transform, if they are to achieve business success. To make it happen, the CEO survey highlights specific areas where investments are being made to achieve such transformation.
– 82% CEOs are willing to invest in physical and digital infrastructure;
– 69% CEOs are willing to invest in regulatory compliance;
– 63% CEOs plan to invest in emerging technologies.
As many as 57% CEOs view customer-focused transformation as a key growth component. Other aspects of business transformation include innovation, M&A and competitive reactions-led change. Considering that organisations are looking to get closer to their customers, increase productivity and strengthen organisational resilience, investments in these areas will continue over next three years.
Organisations must also make judicious investments in new products and services along with digital infrastructure, if they are to attain the objective of transforming their operating model. Digitising operations will not only ensure daily business is conducted efficiently, but also ensure that data is stored and leveraged in a systematic manner. For example, NBFCs are harnessing the power of digital platforms to offer loans to the new-age tech-perceptive loan-seeker at the click of a button.
This has resulted in organisations looking at innovation going beyond traditional product/service, moving towards more inventive ways of doing business. For example, advanced analytics is bringing in greater effectiveness and efficiency to most business functions—be it sales and marketing or supply chain management. Technology enablement will be crucial in connecting and integrating all business functions, giving rise to a truly connected enterprise. India Inc will witness this kind of disruption in the coming years, and needs to gear up.
Organisations must also look towards upskilling existing employees and sync design strategies in alignment with transformation drivers. In fact, a good 73% CEOs plan on making big investments in talent acquisition over the next three years.
If organisations are to stay ahead of the curve, they must look at growing inorganically, building collaborative partnerships, joint ventures and M&As. Lastly, the long-term success of an organisation hinges on its ability to stay on top of trends and having a ‘customer-first’ mindset, both of which should come as second nature to them.