Redefining Boundaries & Prospering in the Age of Disruption

CFO/HR Webinar: Redefining Boundaries & Prospering in the Age of DisruptionDECEMBER 15, 2016 VIRTUAL EVENT

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CFO San Francisco Wednesday, February 8, 2017

Human Capital San Francisco Wednesday, March 22, 2017

CFO Atlanta Thursday, April 6, 2017

CFO Los Angeles Tuesday, May 9, 2017

Human Capital Chicago Wednesday, May 10, 2017

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CFO/HR Webinar: Redefining Boundaries & Prospering in the Age of Disruption

Eric Lesser | Research DirectorCarl Nordman | Research Director

For this study we surveyed

business leaders…

Chief Executive Officers (CEOs)Chief Financial Officers (CFOs)Chief Human Resources Officers (CHROs)Chief Information Officers (CIOs)Chief Marketing Officers (CMOs)Chief Operating Officers (COOs)

818 643601

1,805723657

©2015 IBM Corporation8

©2015 IBM Corporation May 1, 20239

“The ‘Uber syndrome’ – where a competitor with a completely different business model enters your industry and flattens you.”CIO, Transportation, United States



CxOs expect industry convergence to have the biggest impact on their business

Total CEO CFO CHRO CIO CMO COO

70%

60%

50%

40%

30%

20%

10%

0%

Industry convergence

The “anywhere” workplace

Rising cyber risk

The redistribution of consumer purchasing power

The sustainability imperative

Alternative finance and financing mechanisms

The sharing economy

Top trends to impact business (in 3 to 5 years)


29%

CxOs are terrified of outsiders making a land grab

More competition expected from other industries

+26%

2013

no change

39%

54%

43%

2015

More competition expected from within the same industry

“We used to look at the Four Seasons as a competitor. Now we look at disruptors like Airbnb.”

CMO, Travel, United Arab Emirates

Business landscape change (in 3 to 5 years)


CEOs again selected technology as the most important external force that will affect their enterprise

External forces impacting the enterprise (in 3 to 5 years)2006 2008 2010 2012 20152004

Technology factors

Market factors

Regulatory concerns

Macro-economic factors

Socio-economic factors

Globalization

People skills

Geopolitical factors

Environmental issues

2013


The technologies that CxOs expect to revolutionize business tomorrow are already in play today

Cloud computing and services

Mobile solutions

Internet of Things (IoT)

Cognitive computing

Advanced manufacturing technologies

New energy sources and solutions

Bioengineering

Man-machine hybrids

63%

61%

57%

37%

28%

23%

12%

10%

Technologies revolutionizing business (in 3 to 5 years)


Most CxOs believe technology will cause them to reassess the way they run their business

Parts of the business most impacted by the next wave

Product/serviceportfolio

Operating model

Partnerships Deliverychannels

Revenue model

Customer types or segments

73%

68%

61% 60%57%

52%


Industry convergence and technology will directly affect how companies seek out and manage talent

New skill requirements will force companies to reconsider their recruiting plans and brand image(e.g., GE TV advertisements with “Owen”, a new application developer explaining his job to friends and family)

Capture new fish in new ponds

Create an inviting landscape for new species to thrive

Watch out for game hunters looking to poach in yourterritory

Companies will need to design employee experiences that attract and retain individuals with unique talents and expertise (e.g., data scientists, content curators)

Competitors from previously unrecognized areas are looking to poach existing talent (e.g., Uber hiring robotics researchers from Carnegie-Mellon University)


These changes will provide the impetus to transform the overall HR function…

Rapidly changing technologies and businesses will require HR organizations to quickly identify needed key skills and capabilities and build ongoing learning opportunities

Shift towards continual workforce planning and skills development

Develop tools and processes that treat employees as consumers

Focus on building collaboration and diversity of thought

As technology infiltrates all aspects of the business, employees will expect the same level of technology capabilities and experiences in their dealings with the HR function

Organizations will be constantly bringing in individuals with different skills, backgrounds and viewpoints, requiring those individuals to feel comfortable and to work together effectively


…as well as require leadership capabilities that help employees adapt to a rapidly changing world

Leadership understands the impact of changing technologies on the workforce

Leadership balances the need to deliver business results with the ability to lead through change

The enterprise is prepared to manage a more complex workforce

“We need a chessboard of new executive capabilities.”

Peter Fasolo, CHRO, Johnson & Johnson, United States

Leadership capabilities addressing disruptive change63%

62%

46%


Two groups of CFO respondents stand out

Finance Efficiency Enterprise-wide information standards Standard financial chart of accounts Common finance data definitions and

data governance Standard/common finance processes

Business Insight Operational planning and forecasting

capability Finance talent development Common planning platform

Value Integrators:19% of respondents were deemed Value Integrators for being most effective on 7 factors. They outperform on enterprise revenue growth and profitability.

*Performance Accelerators:4% of respondents (subset of Value Integrators by definition) exceled with more advanced analytics.

More Advanced Analytics Profitability and economic analysis Pricing Demand planning and forecasting Product and services development Mergers and acquisitions

Other finance teams

81%

*Value Integrators

19%

4%of total sample


The stand outs grow faster and are more profitable

85%

55%

Revenue growth

85%

54%

Profitability

more55%

more57%

Enterprise performance

Other finance teamsPerformance Accelerators


77%

58%

More focus on new markets +33%

Top CFOs are more likely to take the long view…Performance Accelerators are 61% more likely to be engaged in enterprise strategy…

…and 33% more likely to be focusing on new markets

Areas of effectiveness in organization

Business landscape change (in 3 to 5 years)

Performance Accelerators are enabled by far more effective traditional performance analysis capabilities

Areas of effectiveness in organization


80%

41%

100%

62%

more61%

Provide input into enterprise strategy

100%

54%

Measure/monitor business performance

Optimize planning, budgeting and forecasting

Integrate financial planning with strategic and operational planning

95%

56%

100%

68%

more47%

more85%

more70%


… and are more prepared for the “next wave”…

Performance Accelerators are more actively involved in exploring the potential of the next wave

Performance Accelerators leverage analytics better to identify the “next wave”, whether emerging opportunities or risks

Parts of business most impacted by the next wave Areas where predictive analytics applied


95%

66%

Products/services portfolio

Customer types or segments 50%

83%

+66%

+44%100%

66%

Risk managementRevenue forecastingFinancial planning

100 %

61%

95 %

46%

more107%

more52%

more64%


…because they “Integrate, analyze and adapt.”

They leverage a COE to support analytics, integrate information across the enterprise and invest in talent…

and rely more heavily on analytics to drive organic and acquisitive growth

Areas of effectiveness in organization Areas where predictive analytics applied


88%

25%

Pricing and promotionoptimization

Mergers and acquisitionsIdentification of new products/services

93%

32%

89%

32%

more178%

more252%

more191%

80%

41%

100%

54%

more85%

Develop talent in the finance organization

89%

19%

more368%

Implemented a Center of Excellence for analytics

77%

42%

more83%

Drive integration of informationacross the enterprise


We invite you to continue the conversation

ibm.com/csuitestudy


Redefining Boundaries

Insights from IBM’s Global C-suite Study

MODERATOR

Eric Lesser, IBM

PANELISTS

Roger Blanken, International Flavors & Fragrances John Hugo, Workday JoAnne Kruse, American Express Global Business TravelCarl Nordman, IBM John Sigmon, AARP

"Redefining Boundaries & Prospering in the Age of Disruption"


Audience Q&A will begin shortly. Please submit your questions.


Redefining Boundaries & Prospering in the Age of Disruption

Technology

Transcript of Redefining Boundaries & Prospering in the Age of Disruption