The document summarizes the key findings of IBM's global CEO study on the enterprise of the future. The study found that to thrive in the future, companies will need to be hungry for change, innovatively meet customer needs, and disrupt existing business models. CEOs said they are struggling to manage rapid change and that globalization is now intrinsic to business success. The majority of CEOs plan to partner, merge or acquire to develop new capabilities and access global resources and markets.
The document summarizes the key findings of IBM's global CEO study on the enterprise of the future. The study found that to thrive in the future, companies will need to be hungry for change, innovatively meet customer needs, and disrupt existing business models. CEOs said they are struggling to manage rapid change and that globalization is now intrinsic to business success. The majority of CEOs plan to partner, merge or acquire to develop new capabilities and access global resources and markets.
The document summarizes the key findings of IBM's global CEO study on the enterprise of the future. The study found that to thrive in the future, companies will need to be hungry for change, innovatively meet customer needs, and disrupt existing business models. CEOs said they are struggling to manage rapid change and that globalization is now intrinsic to business success. The majority of CEOs plan to partner, merge or acquire to develop new capabilities and access global resources and markets.
The document summarizes the key findings of IBM's global CEO study on the enterprise of the future. The study found that to thrive in the future, companies will need to be hungry for change, innovatively meet customer needs, and disrupt existing business models. CEOs said they are struggling to manage rapid change and that globalization is now intrinsic to business success. The majority of CEOs plan to partner, merge or acquire to develop new capabilities and access global resources and markets.
CEO Study Register to download the full report, Global CEO Study: The Enterprise of the Future Download the Executive Summary (240KB) Benchmark your organization
Hungry for change. Wildly imaginative. Disruptive by nature. Totally wired to the people who matter most. To some people, this might sound like your average teenager. In fact, these are the qualities companies will need to thrive in the near future, according to our newest CEO study. Every two years, IBM talks to some 1,000+ CEOs and public sector leaders worldwide. We ask these executives: what are they thinking about? Where are they investing? What do they believe the Enterprise of the Future will look like? We also reviewed the differences between outperforming and underperforming businesses. This is our third global CEO survey. Heres what we found.
Insights Register to download the 2008 Global Human Capital Study Register to download the 2008 Global CFO Study
Leadership Rethinking Innovation: Insights from the worlds leading CEOs The IBM Institute for Business Value delivers leading-edge insights
Resources IBM Strategy and Change Consulting E-mail an IBM Strategy and Change consultant or call 1-800-IBM7080. ext GBS
Stay on top of innovation
More Ideas from IBM Insights and resources for CIOs
Hungry for change
Business Executives
Syndication Subscribe via RSS
Help with subscribing
We have seen more change in the last 10 years than in the previous 90.Ad J. Scheepbouwer, CEO, KPN Telecom Coping with change is nothing new. Whats different is the head-spinning rate of change today and the fact that its coming from so many different quarters. In 2004, CEOs worried about market factors. In 2008, while the market
IDEAS from IBM
05 May 2008
still dominates the agenda, executives now face additional socioeconomic,
geopolitical and environmental challenges including people skills, technology advances and environmental concerns.
And companies are struggling to keep up: There is a gap of 22% between how CEOs rate their ability to manage change successfully versus their expected need for ita gap that has nearly tripled since 2006, when it was only 8%.
IDEAS from IBM
05 May 2008
So how does the Enterprise of the Future manage constant change? The Swiss engineering firm ABB can offer some insights. ABB launched its Step Change Program in 2003. Hundreds of measures were identified and executed on schedule resulting in savings of more than US $900 million. Their change program today has a broad portfolio of initiatives, representation from all parts of the company and an Executive Committee that tracks progress and provides regional accountability. The result? ABBs successful focus on its strengths in power and automation technology and its improved productivity and cost structure were driven largely by its enterprise-wide change program. In 2007, ABBs net income increased to a record US $3.8 billion.
Innovative beyond customer imagination
Developing countries grow gradually at first, then suddenly emerge
as large markets. We must be prepared to respond quickly.Yasuo Inubushi, President, Kobe Steel In India, 400 million consumers will demand new housing in the next 20 years. Thats more real estate than the United States has built since the Second World War, pointed out one real estate CEO. Globalization is producing a new prosperity around the world and two thirds of CEOs are investing to capture this opportunity.
IDEAS from IBM
05 May 2008
These newand existing consumersare more demanding and
knowledgeable than ever. With the billion-user Internet, customers can broadcast their opinions about a product. They can link up with like-minded consumer groups and sway public opinion, not to mention company behavior. Three quarters of CEOs view these newly empowered consumers with enthusiasm. Here is a chance to get customer input and develop products that differentiate their company and justify premium pricing. This can be much quicker and more effective than developing products in a vacuum, only to find they missed the mark and the market. Several years ago, Nintendo, the maker of console games, needed to regain its leadership position, find new ways to delight gamers and reach new audiences. To do that, it went straight to the sourcegamers themselves. Through a community of experienced gamers, Nintendo gained valuable insights into marketing needs and preferences. This has influenced everything from actual game offeringslike an online library of nostalgic games that appeal to older gamersto new product design such as the intuitive controls of the new Wii system. The collaboration seems to have paid off: Nintendo is once again ahead of the competition with 44% market share.
IDEAS from IBM
05 May 2008
Globally integrated
A few years ago, we were a national company; now were a global
company. Our integrated supply chain must adapt to meet demand in 50 countries. Were going to have to bring people in from the outside.Jim Guyette, President and CEO, Rolls-Royce North America Two years ago globalization meant paring off a function and moving it abroad: a factory in China, a call center in India. The key driver was cost. Today, CEOs see globalization as intrinsic to their business, the means of accessing the best resources wherever they are. It is the gateway to new markets. To fully realize their globalization strategies, 57% of CEOs will make fundamental changes to their organizations capability and skill mix. What will they do? Of those interviewed, 85% plan on partnering; 66% will use mergers and acquisitions. One such company is Hong Kong-based Li & Fung. They used acquisitionsmore than 20 in less than 10 yearsto grow market share in their target geographic markets. With a network of 10,000 suppliers and staff in 40 different countries, Li & Fung can source from virtually anywhere in the world. Cotton can be purchased from America, knit and dyed in Pakistan and sewn into garments in Cambodia. When Li & Fung acquires a company, it typically preserves the front-end customer interface, which is often the reason for the acquisition, but merges the back end with its own operation within 100 days of deal close.
IDEAS from IBM
05 May 2008
Disruptive by nature
For us, enterprise model innovation is primarily about having
the right business model to enter other markets and secure new capabilities.Andrew Brandler, CEO, CLP Holdings Limited A common theme emerged from our interviews: virtually all CEOs are changing their business models. Two thirds are implementing extensive innovations. Why now? Because its possible. The Internet is allowing them to enter niche markets and reshape their processes, delivery channels and ways of partnering. Companies are innovating in three ways: Rethinking their enterprise business model: which processes are kept in house or spun out to partners? Changing their pricing models, such as Gillette which switched its primary revenue from razors to blades Reshaping the way their industry conducts business, such as the way Apple ipod turned the music business upside down U.S. pharmaceutical maker Eli Lilly turned to business model innovation to meet an ongoing industry challenge: bring new medicines to market faster. Its newest model is based on pioneering risk-sharing relationships, such as its 2007 agreement with Nicholas Piramal India Limited (NPIL). NPIL will develop one of Lillys molecules at its own expense, from preclinical work to early clinical trials. If NPIL is successful and the compound reaches the second stage of human testing, Lilly can reacquire it in exchange for milestone payments and royalties.
IDEAS from IBM
05 May 2008
Genuine, not just generous
Our company is investing extensively in corporate social
responsibility. We need to be a reference in this domain. As the leader of the luxury industry, we have to stay ahead.Yves Carcelle, chairman and CEO, Louis Vuitton The next generation of socially minded customers, workers and investors is watching every move a company makes. CEOs recognize this and corporate social responsibility (CSR) is climbing higher on the agenda. Its critical to attracting talent, breaking into new markets and protecting the brand. As a result, 25% of companies will increase their investment in this key area, generally focused on developing new green products. One challenge will be how to make CSR a more holistic aspect of company processes.
SEND US YOUR FEEDBACK:
Were interested in hearing what you think about this article. Do you have a question, comment, suggestion or story idea to pass along? Please e-mail Ideas from IBM.
IBM Corporation New Orchard Road, Armonk, New York 10504, USA
Changeship - Workbook: Building and scaling next generation businesses in the digital polypol: Purpose driven - Customer dedicated - Sustainability enabled
Stream Theory: An Employee-Centered Hybrid Management System for Achieving a Cultural Shift through Prioritizing Problems, Illustrating Solutions, and Enabling Engagement
Changeship - Workbook: Building and scaling next generation businesses in the digital polypol: Purpose driven - Customer dedicated - Sustainability enabled
Stream Theory: An Employee-Centered Hybrid Management System for Achieving a Cultural Shift through Prioritizing Problems, Illustrating Solutions, and Enabling Engagement
