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Executive Outlook 2013 Report

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What’s on the minds of senior business leaders as they
begin 2013? Despite ongoing global economic uncertainty, and increasing competitive pressures, how will organisations approach the key issues of innovation and business viability in the short and medium term?
ExEcutivE OutlOOk SurvEy 2013
Leading for innovation & growth
To answer these questions, we decided to focus our annual survey of CEOs, Directors, Chairpersons and VPs across Asia-Pacific, the Americas and Europe on innovation and business viability. We asked 179 people in senior leadership positions to tell us about their company’s direction over the
year ahead, and how they’re balancing the need to be profitable with the pressures of continuous change on a global scale.

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Executive Outlook 2013 Report

  1. 1. ExecutiveOutlook 2013reportLeading forinnovation& growth
  2. 2. introductionThe findings of our annual C-suite culture was their key focus for the on implementing new technology it seems that after four-plus yearssurvey are in. This year, we spoke year. And, that for many, the main and creating new products. of global economic turmoil, manywith 179 executives in a broad barriers to innovation and agility leaders are again recognising thatrange of industries across the globe. are those that are embedded within While this initially surprised us, it their employees’ attitudes areWe asked them about their views their organisational culture. also reminded us of the critical critical to business success. Pam Berklichon innovation and how they plan nature of talent in an uncertainto sustain growth amid ongoing In fact, C-suite executives appear economic environment. We know We are pleased to share theeconomic uncertainty. to be just as focused on the that competitiveness is not just thoughts and insights of these cultural aspects of organisational about great products and efficient business leaders in more detailWhat they told us was that company innovation and change as they are processes—it’s about people. And throughout this report. 2
  3. 3. / Job titles of survey participants 46% VP, Director 38% CEO, MD, Chairman 16% EVP, SVPaboutthe survey / Company size 6% 15% 5,000–10,000 More than employees 18% 10,000 250-999 employees employeesWe conducted our annual Executive Responses were received fromSurvey in January 2013, canvassing 179 executives in a wide range ofthe views and opinions of senior industries, including:leaders across the world on the • energy and utilitiestopic of: Leading for innovation • oil and gas 23%and sustaining growth. • healthcare 1,000–4,999 • bio-technology employeesWe commissioned an on-line • banking/financial servicessurvey over a two-month period • propertyfrom 15 November 2012, which • IT and communication 38%targeted C-suite and senior • manufacturing Less than 250 employeesmanagement executives only. • retail and FMCGAll responses were confidentialand have been aggregated. 3
  4. 4. Expect growth this yearwhat 88%they said believe their competitive position is unchallenged 11% forecast Have a proactive significant approach to growth innovation 34% 42% feel accountability for growth is too narrow 22% 4
  5. 5. most expect to grow this year 1% Significant decline Despite the challenging business environment of 2012, Significant decline 4% Marginal decline 34% SignificantExpected revenue/business growth / growth and the ongoing uncertainty on global markets, 88% of Marginal decline business leaders have change 7% No a positive outlook for the growth 1% Significant decline S of their business in 2013. 4% Marginal decline No change 33% Significant growth M Marginal growth While most executives (55%) are expecting only marginal 7% No change 88 % N growth this year, one-third (33%) is looking forward to Significant growth ‘significant’ growth within their organisation. Just seven 55% Marginal growth M per cent of business leaders are expecting no change for positive S their organisation on this front, and a mere one per cent is 55% Marginal growth anticipating a major decline. Leaders in Asia-Pacific have higher expectations for business performance this year than those in the Americas and Europe, which is to be expected given the ongoing debate over debt / Outlook by Geographical Region issues and constrained government spending in those regions. 4% 6% 3% 7% 5% 17% 22% 56% 55% Significant decline 44% 34% Marginal decline 36% No change 11% Marginal growth Significant growthAmericas/EMEA APAC ALL Americas/EMEA APAC 5
  6. 6. sustaininggrowthAs you would expect, for many businesses (37%) profit- / Challenges for business longevitygenerating and core-business activities are given priority overlonger-term investments to promote expansion and growth. 11% 37% No challenges identified Profit-generating activities take priorityHowever, it appears that more than one in five businessleaders (22%) would like to see a greater focus on these 13%‘growth’ initiatives, but believe this is stymied by a lack of Lack of understanding of threats to sustainabilityaccountability for competitiveness further down the line intheir organisational hierarchies. 17% 22%In fact, the majority of barriers to improving long-term business Organisation looks to quick fixes only Lack of individual accountablity/prospects (52%) appear to be imbedded in the culture of the seen as the job of top management onlyorganisation: lack of accountability (22%); too great a focus onshort-term quick-fixes (17%); lack of knowledge required tocontribute to solutions (13%).Businesses of all sizes seemed to be equally affected by thesecultural barriers to improving competitiveness. Whether fromlarge or small organisations, the same proportion of leadersreported the concern that employees did not take individualaccountability for competitive longevity and instead saw this asa job for top management only.Just one in ten business leaders (11%) believes that theircompetitive position is so strong that no challenges to it canbe seen on the horizon. 6
  7. 7. focus areasto strengthencompetitivenessLeaders appear to be acutely aware of the need to fully engage / sustainability factors that require integrationeach and every employee in the task of maintaining andimproving business competitiveness over the long term. With Organisation and employee 65%two-thirds of leaders (65%) nominating this as a key focus area, Product innovation 53%it seems that 2013 will see a greater focus on individual trainingand stronger communication of business-critical issues. Goals and policy 51% Technology 48%In fact, leaders are just as focused on the cultural aspects of Education 27%organisational innovation as they are on implementing newtechnology and rolling out new products. It seems that the Environment 26%race to remain competitive is seen not only as a product orprocess issue, but as a human issue—and leaders know theiremployees’ attitudes are critical to success.Many leaders (53%) do nominate ‘product innovation’ as a keyfocus area that will strengthen their business prospects over thelonger term, while the implementation of new technology is aseen as a critical issue for 48% of leaders. However, winning inthe marketplace will also be dependent upon the alignment ofindividual goals with those of the entire organisation, and thisis likely to create new pressures and opportunities for staff withresponsibilities for HR, communications, change managementand team leadership going forward. 7
  8. 8. promotinginnovationMany leaders (42%) say they take a proactive approach / How the organisation approaches innovationto innovation and have measureable goals and resources 1% Not sureallocated to their initiatives. However, one-fifth (20%) sayscore business activities remain their only focus, while 37% 20%see incremental change as the way forward. We remain focused on our core business activities onlyThe overall approach to innovation appears to be heavily 42%influenced by the geographical reach of the organisation, We have measurable goals and allocate resources forand by whether or not it is operating in the private sector. innovation over the long term 37%Global firms and multi-nationals are more likely to take a Our focus on incremental innovationplanned, proactive approach to innovation, while localfirms and those in the public or not-for-profit sectors wereless likely to do so. Public sector organisations and not-for-profits remain firmly focused on core business activities only, / approaches to innovation by company typewith just one in five actively planning for—and allocatingresources to—innovation. 1% 3% 6% 12% 20% 20% 17% 47% 37% 37% 34% 50% Not sure We remain focused on our 27% core business activities only 51% Our focus on incremental innovation 42% 46% 30% Have measurable goals & allocate 20% resources to protect long term initiatives towards innovation ALL Non-profit/ Global firm Multi-national Local Government/ conglomerate GLCs 8
  9. 9. barriers toinnovationAccording to senior leaders, the main barriers to innovation / biggest hurdle to the implementation of innovationappear to be those embedded within organisational cultures. 2%While one-in-five leaders (20%) see legislative requirements as No time for innovationa major barrier to innovation, three-in-ten (31%) say it is mainly 3% Contracting issueshampered by employees’ resistance to change, and a further 31%15% feel that their organisation has a culture of risk aversion. 14% Resistance to change Lack of funding/sponsorshipA lack of structure and process regarding funding, 15%executive sponsorship and the requirements or business Lack of implementation/ performance criteria or business casecase for innovation initiatives does appear to be an issue 15% 20%for a significant proportion of businesses, yet the key issue Risk aversion culture Stiff legal requirementsis undoubtedly cultural readiness for change across alllayers of organisations. 9
  10. 10. revenue outlookand approachto innovationOf course, time will tell whether or not leaders’ revenue / revenue outlook 2013 by different segments toward innovationpredictions turn out to be accurate. However, it’s interesting 4% 3% 6% 9%to note that those leading organisations with a structured, 7% 4% 5% 8%proactive approach to innovation are far more positiveabout their 2013 revenue outlook than those who focus only 43%on core business activities, or who take an incremental 55% 59% 68%approach to innovation.Here, the difference is quite stark—45% of those with a Significant decline Marginal declineproactive approach are expecting significant growth in their 34% 45% 27% 23% No changerevenue this year, compared to just 23% of those who are Marginal growthfocusing their efforts entirely on core business activities. Significant growth ALL Protecting long term Focus on Focused on business innovation incremental core business initiatives innovation activities only100 80 60 40 10
  11. 11. conclusionWhile most leaders are expecting some growth for their Yet, the biggest challenge for leaders seeking sustainedbusiness in the year ahead, those located in the Asia- growth appears to be cultural readiness to changePacific region expressed more optimism than others. within organisational walls. Even after accounting forGiven economic factors outside organisations’ control, the different regulatory requirements and industrythis result is hardly surprising. Likewise, larger global dynamics that undoubtedly shape an organisation’sfirms and multi-nationals were more confident about approach to innovation, leaders are clearly saying thattheir outlook than local organisations—perhaps due employee populations are resistant to change.to their ability to leverage multi-country markets and Cultural change seems to be the focus of leadersspread risk more favourably. across the world as they look for new ways forward inWhat stands out from the research is that those an uncertain and increasingly competitive globalorganisations with the greatest positivity going into market. While many see that processes and products2013 are those with a proactive approach to innovation. need to adapt to meet demand, leaders see their ownThey see significant opportunities to innovate product people as both the key, and a potential barrier, tolines and to ensure processes are more efficient. achieving this. 11
  12. 12. About Accessaccess executive search is your strategic partner when it comes to the identification and address of C-Levelleaders in the German speaking region of Germany, Switzerland and Austria. With 20 years of market experience,our solutions are based on long-lasting, trustful relationships. We deliver high quality service to both clientsand candidates and do our best to meet your individual needs every day. Having a deep understanding ofthe different industries, our experts find the candidates you need and provide you with excellent talent, whocontributes to your business. Visit www.access.deAbout BTI ConsultantsSpecializing in global and regional C-level and senior executive searches, BTI Consultants leverages on the abilityto align ourselves with the changing face of leadership, our deep network of proven consultants extends ourreach across specific industry sectors and disciplines. We operate on the premise that every leader we place hasthe ability to make a positive impact to the business they enter, the people they interact with, and the communityat large. BTI Consultants is the specialist consulting practice of Kelly Outsourcing & Consulting Group.Visit www.bticonsultants.comAbout KellyOCGKellyOCG is the Outsourcing and Consulting Group of Fortune 500 workforce solutions provider, Kelly Services,Inc. KellyOCG is a global leader in innovative talent management solutions in the areas of Recruitment ProcessOutsourcing (RPO), Business Process Outsourcing (BPO), Contingent Workforce Outsourcing (CWO), includingIndependent Contractor Solutions, Human Resources Consulting, Career Transition and OrganizationalEffectiveness, and Executive Search. Further information about KellyOCG may be found at kellyocg.com. exit

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