An epoch is in the making as, over the next decade, every area of our life and work will be embedded with technology advancements. This pace of change will be far greater than what humankind witnessed during the industrial revolution, as the adoption of new technologies will occur at an exponential pace in every walk of life.
I am advocating for CEOs to take charge of their company’s technology agenda for growth and success. I have spoken to six boards of listed companies in the last 12 months and several CEOs. I believe that CEOs and boards do not have a choice in the matter as technology enablement has become mission-critical to every company. From the perspective of the CEO and the board, they do not necessarily need to become technology experts. All they need is to have a clear understanding of how technology advancements can help their business by redefining business models, operational processes and most importantly – customer experience and engagement.
Companies in almost all industries including retail, banking, media, education, entertainment, communications, IT services, recruiting, transportation and healthcare are seriously impacted by the innovative use of new technologies. New technology-enabled companies are seriously disrupting traditional companies by leveraging technology advancements to create new businesses. Some examples are Amazon, Netflix, Airbnb, Apple, Google, Zappos, Skype, Alibaba, Facebook and Freelancer. As these new companies emerge, we have seen iconic companies disappear, such as Nokia, Borders, Blockbusters, Life Magazine, Woolworths Group, Kodak.
I believe that many of these new entrants to traditional industries have built a significant market share very quickly by:
- creating better and more enjoyable customer experiences and engagement models supported by technologies;
- delivering at a significantly lower cost than the established traditional player;
- having terms and conditions such as “return if you don’t like, no questions asked”;
- offering better products or services to clients compared to traditional players; and
- providing outstanding ROI for shareholders and investors.
It is not surprising that some of these businesses have generated more than $1 billion in revenue in a relatively short time, and they are continuing to grow. The new technology advancements include cloud, social media, data analytics, mobility, the internet of things and gamification. These advancements are forcing large companies to think differently about data, security and new business models to serve clients.
I believe that what prevents many CEOs and boards driving growth agenda by using new technology advancements, is a lack of knowledge and understanding. Recent studies such as the one conducted by Grant Thorton have identified that most boards worldwide fail when it comes to diversity and technology. Some of the recent surveys of company boards such as the PwC’s 2015 Annual Corporate Directors Survey indicate that majority of boards believe that technology is mission-critical and crucial to the survival of a business. Surveys, such as the Watermark Board Diversity Survey 2015 highlighted a deficiency in suitably skilled executives at the board and CEO level to leverage technology advancements for business growth. While almost 55% of board-level executives have accounting and legal backgrounds, only 3% come with technology experience or relevant skills. Based on surveys undertaken and reports published, it is evident that companies do not have sufficient skills at the board, CEO and senior executive level in technology.
For those CEOs seeking growth leveraging through technology advancements, I urge them to:
- improve their understanding of disruptive technology trends in their own industry and related industries;
- increase board and senior executive level awareness, particularly in relation to strategic benefits and risks;
- adopt an agile and lean approach to technology-enabled innovation;
- prioritise technology enabled business growth and transformation as a major corporate initiative sponsored by the board;
- reduce leadership talent obsolescence; and
- become bold and increase their appetite for failures/risk taking
- make CIO or the relevant technology leader a member of the senior executive team
- seek sufficient external and independent advice to avoid missing out on opportunities
- lead by example in adopting new innovations and technological advancements
It is important for all CEOs to understand the role of technology in business transformation and growth if they want to succeed in the new digital age. Successful use of latest technological advancements will positively impact corporate strategy, policies, operations, competitive landscape, revenue opportunities employee collaboration and customer experience.