Growth drives CEO agenda as channel prepares to capitalise

Growth drives CEO agenda as channel prepares to capitalise

Business leaders shift focus to change and upgrade internal organisational structures

Growth tops the list of CEO business priorities in 2018 and 2019, opening the door for the channel to capitalise on increased demand for digitalisation.

According to Gartner research findings, as simple growth becomes harder to achieve, executives are shifting focus to change and upgrade internal organisational structures, driven by a deeper understanding of digital business.

“Although growth remains the CEO's biggest priority, there was a significant fall in simple mentions of it this year, from 58 per cent in 2017 to just 40 per cent in 2018,” Gartner vice president, Mark Raskino, observed.

“This does not mean CEOs are less focused on growth, instead it shows that they are shifting perspective on how to obtain it.

“The 'corporate' category, which includes actions such as new strategy, corporate partnerships and mergers and acquisitions, has risen significantly to become the second-biggest priority.”

Of note to the channel, Raskino said IT remains a high priority coming in at the third position, with surveyed CEOs mentioning digital transformation, in particular.

Meanwhile, workforce has risen rapidly this year to become the fourth-biggest priority, up from seventh in 2017.

“The number of CEOs mentioning workforce in their top three priorities rose from 16 per cent to 28 per cent,” Raskino explained.

“When asked about the most significant internal constraints to growth, employee and talent issues were at the top. CEOs said a lack of talent and workforce capability is the biggest inhibitor of digital business progress.”

Gartner ResearchCredit: Gartner
Gartner Research

Despite a leaning towards embracing new and emerging technologies, CEOs recognise that culture change is a key aspect of digital transformation.

Findings - published in the 2018 Gartner CIO Survey - show that CIOs agreed culture was a “high-priority” concern within an organisation, but only 37 per cent of CEOs believe a “significant or deep culture change” is needed by 2020.

However, when companies that have a digital initiative underway are compared with those that don't, the proportion in need of culture change rose to 42 per cent.

“These survey results show that if a company has a digital initiative, then the recognised need for culture change is higher,” Raskino said.

“The most important types of cultural change that CEOs intend to make include making the culture more proactive, collaborative, innovative, empowered and customer-centric. They also highly rate a move to a more digital and tech-centric culture.”

Digital business

For resellers, integrators and managed service providers operating services and solutions, alongside consultants and specialist players offering guidance and advice, digital business matters to CEOs.

Survey respondents were asked whether they have a management initiative or transformation program to make their business more digital - the majority (62 per cent) said they did.

Of those organisations, 54 per cent said that their digital business objective is transformational, while 46 per cent said the objective of the initiative is optimisation.

In the background, CEOs' use of the word "digital" has been steadily rising.

“When asked to describe their top five business priorities, the number of respondents mentioning the word digital at least once has risen from 2.1 per cent in the 2012 survey to 13.4 per cent in 2018,” Raskino added.

“This positive attitude toward digital business is backed up by CEOs' continuing intent to invest in IT. Sixty-one per cent of respondents intend to increase spending on IT in 2018, while 32 per cent plan to make no changes to spending and only seven per cent foresee spending cuts.”

In addition, Raskino said the percentage of respondents who think their company is an innovation pioneer has reached a high of 41 per cent (up from 27 per cent in 2013), with fast followers not far behind at 37 per cent.

“CIOs should leverage this bullish sentiment by encouraging their business leaders into making "no way back" commitments to digital business change,” Raskino added.

“However, superficial digital change can be a dangerous form of self-deceit. The CEO's commitment must be grounded in deep fundamentals, such as genuine customer value, a real business model concept and disciplined economics.”

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