A new report from Accenture shows that while 91% of companies in India finally have a clear picture of the challenges they face today, only a handful are completely confident in their current abilities to foresee and respond to future disruption. Business Futures 2021 aims to help leaders make sense of a new reality by identifying the Signals of business change that are reshaping organizations globally and will be critically important for leaders to understand in order to drive success today and beyond.
“To stay competitive and resilient in the new context created by the pandemic, organizations need high levels of agility and responsiveness. They must seize the many opportunities presented by the compressed transformation journey that they are already on,” said Piyush N. Singh, India Market Unit lead, Accenture.
“Using data and analytics, leaders can spot, respond to and target potential risks ahead and explore new growth avenues. Another opportunity for reinvention and growth is embracing decentralized decision-making to become more of an edge organization – with empowered, multidisciplinary teams that are centered on customer outcomes,” said Singh.
Longstanding trends like the increased importance of experiences, greater adoption of cloud, and changes in buying patterns have all been interrupted, accelerated, or reversed due to the pandemic. At the same time, new supply chains and business models were set up in days not months, and the promise of new scientific breakthroughs was emphatically realized in months, not years.
When coupled with profound, structural changes following more than a year of turbulence, a business environment ripe for reinvention emerged, with a strong desire to look deeper into the future and to better map the trajectory and impact of change.
Starting with an expansive list of 400 crowd-sourced trends, Accenture teamed with external advisors, academics, and researchers to narrow down the list to 25 Signals of business change. Theses Signals were shown to mature and have their greatest impact on organizations within the next three years, six Signals stood out as being essential to the future success of organizations, presenting opportunities and incentives for leaders to embrace change and find new ways to grow, starting today:
1) Learning From the Future – See change before it happens
As organizations fundamentally rethink ways of doing business that deliver growth, focusing on historical data to inform the future has been challenged. To make decisions faster, many organizations are now capturing new data sets and using analytics and artificial intelligence to spot, respond to and target changing market and consumption shifts. The report finds that 78% of organizations in India have increased their use of both internal and external sources of real-time data over the past 12 months, yet only 43% reported that people across their organization consistently use real-time data in their day-to-day work. Moreover, only 37% of businesses in India said they have a C-suite member accountable for these efforts, and fewer than half (45%) have sufficient skills within their workforce to support this capability.
2) Pushed to the Edge – Decentralize decision-making
The global crisis has made markets much more fragmented, and distinct regions are emerging with their own governance systems, economic models, and cultural norms. At the same time, consumer behaviors are changing fast, with new competitors catering to evolving needs. Businesses are responding by pushing decision-making authority to people at the edges of their organizations, creating a networked structure of teams that can act with speed and agility. When businesses empower their “edges” to make most day-to-day operational decisions, they free up their headquarters to focus on key strategic decisions. The report found that 97% of organizations in India are willing and able to operate more like a broad federation of enterprises to respond to increasingly fragmented business environments, and 67% say their business model will change over the next year.
3) Sustainable Purpose – Move from purpose-focused to purpose-run
Organizations recognize the need to have a purpose that benefits all their stakeholders, but a growing gap between intentions and results emerged. The purpose paradox demonstrates the challenges faced in building sustainability into the fabric of their operations and delivering on commitments made for the benefit of all their stakeholders. The report found that 32% of executives in India say that they are not personally committed to delivering value for all stakeholders, and nearly half (48%) of organizations in India report that one of the biggest barriers is balancing their commercial interests. However, there are signs that the tide has begun to turn toward safeguarding sustainability ambitions alongside profits, with only 24% of leaders in India saying they would consider cutting investments in environmental, social and governance (ESG) initiatives to avoid missing earnings guidance.
4) Supply Unbounded – Break physical limits of fulfillment
The global pandemic stretched supply chains like never before as organizations took drastic steps to keep goods moving. To meet growing expectations for fast, flexible, cost-effective, responsible and sustainable order fulfillment, organizations are breaking the physical limits of their supply chains and moving production to the point of demand. The report found that the majority (93%) of organizations in India have increased or plan to increase the use of micro-fulfillment centers; a similar number (94%) of organizations have or plan to create regional supply chains. Here, too, the alignment on value for all stakeholders shows its prominence, with 82% of organizations in India saying that their customers’ expectations around sustainability significantly increased in the last 12 months.
5) Real Virtualities – Redefine reality and place
As virtual environments come of age, the physical and virtual worlds are blurring and redefining our sense of reality and place while also creating new ways for people to live, work, consume and socialize. Emerging from a year of limited physical interaction, businesses are doubling down on virtual, with 87% of organizations in India investing in technologies to create virtual environments and, among those, 93% are planning to invest further. While current virtual-reality (VR) technology mostly engages our senses of vision and hearing, over time it will become increasingly realistic, engaging all senses, and creating a greater connection to the physical.
6) The New Scientific Method – Become a scientific company
The pandemic shone a spotlight on scientific innovation, putting it at the top of the business agenda. While during the past decade, every company became a digital company, in the coming decade, every company will need to become a scientific company – and apply science to tackle the world’s fundamental challenges. Working at the convergence of the new frontiers of science will bring radical possibilities, but only if organizations can enhance their approaches to innovation. The report found that 85% of organizations in India agree that adopting a scientific approach to innovation will position them for future success, and 86% said that investing in sciences outside their traditional industry boundaries will be critical to their organization’s success.