FREEDOM AND SAFETY
A survey of 3,000 chief executives lifts the lid on corporate priorities after coronavirus.
Getting rid of distractions, discarding outmoded traditions and exploiting unique advantages are the new areas of focus, IBM says in its 2021 CEO Study.
“The COVID-19 pandemic challenged many leaders to focus on what’s essential, like their people,” says Mark Foster, senior vice president at IBM Services
The study – which identifies five key factors that set outperforming CEOs apart – looks at three essential areas: priorities, advantages and lessons.
Agility – being able to respond quickly and pivot without losing momentum – is a top priority for leaders “to an unprecedented degree,” IBM says. More than half (56%) of CEOs emphasize the need to “aggressively pursue” operational agility and flexibility over the next two to three years.
Technology is expected to have the biggest business impact over the next few years. CEOs are looking most to the Internet of Things – the world of connected devices – cloud computing and artificial intelligence to deliver results.
Half of the CEOs in the study cited regulation as a priority. “This unquestionably reflects a rising assertiveness by governments around privacy, data, trade and – amplified by COVID-19 – health,” IBM says.
Five key areas set outperformers apart from underperformers:
1. Leadership – outperformers consistently show “decisive strategic leadership”, with 85% citing leadership as critical to business performance.
2. Technology – the CEOs of outperforming firms are most focused on emerging technologies and the risks and opportunities they bring.
3. Employees – the remote workplace created by COVID is among the most cited areas of future focus by outperformers, with 50% of CEOs identifying it as a key challenge. This is double the rate of underperformers.
4. Open innovation – 63% of outperformers identify partnerships as key to getting ahead with innovation, compared to only 32% of underperformers.
5. Cybersecurity – 26% more outperformers than underperformers cite cyber risk as one of their greatest challenges in the next few years.
By drilling down into its data, IBM found three core areas of focus among CEOs.
1. Customers – 48% of respondents cited customers, clients and citizens as their most important business priorities. This includes creating positive customer experiences and focusing on ethics and integrity.
“They know that trying to exploit or take advantage of customers or partners is a short-term, loser’s game,” IBM says.
2. Products – for 30% of the 3,000 CEOs, products and services are the priority, with a focus on innovation.
3. Operations – the other 20% of CEOs in the study prioritize operations, with a focus on efficiency, distribution, pricing structure and transparency.
“In the context of COVID-19, this is the group hit hardest during 2020,” IBM says. “Among even the outperformers in this cohort, 60% report expected revenue declines for the year, a figure twice the size of outperformers in the customer- and product-focused groups.”
In its Global Risks Report 2021, the World Economic Forum examined the risks and consequences of widening inequalities and societal fragmentation.
“Job losses, a widening digital divide, disrupted social interactions, and abrupt shifts in markets could lead to dire consequences and lost opportunities for large parts of the global population,” the report warns.
While the Forum’s COVID-19 Risks Outlook, published last year, tapped into the views of nearly 350 senior risk professionals on the most likely challenges ahead.
Two-thirds of respondents identified a prolonged global recession as a top concern for business.