Companies recognize the need to evolve their business models to sustain profitable growth amid ongoing disruption. However, most companies have a long way to go in developing key capabilities like sensing demand, tuning supply chains, innovating for customers, and gaining insights to translate into action. The biggest barriers preventing business transformation include a talent shortage, inconsistent governance, inflexible operating models, and an overemphasis on cost cutting and quarterly results rather than a long term view.

1. How companies want
to evolve
How companies see
their business
Focus on
funding growth
In search of balance:
Which Consumer Products
companies can sustain profitable
growth amid ongoing disruption?
The biggest barriers to
business transformation
Make-or-break capabilities:
most companies have a long way to go
Decentralize
decisions
Enlist partners and
expand outsourcing
Emphasize flexibility
over efficiency
Few companies are confident that they can:
Movebeyondconventional
salesforecastingtosense
andshape demand
Tune supply chains to
meet go-to-market
objectives
Innovate to meet
changing consumer
wants and needs
Work with customers to
gain a real-time,
end-to-end view of
the value chain
Secure talent to
translate insight
into action
Accurately map the
portfolio revenue impact
of individual SKUs
Understand the
true profitability of
promotional spending
Identifyandrevise
processes thatdon’t
fuelvaluecreation
Take a
long-term view
Talent
shortage
Inconsistent
governance
and controls
Inflexible operating
models
Ineffective
innovation
Capital
constraints
Early 2016, EY interviewed 212 senior executives from Consumer Products globally.
Visit ey.com/balance to find out more
Companies say that
traditional value-creation
tactics are losing
their potency...
Meanwhile they see
margins getting
squeezed...
...and can no longer
reliably sustain
profitable growth.
...which they say increases
the pressure to change
operating models...
...even though they admit
many previous attempts
have failed.
Most companies
recognize the need for
bolder measures...
...but nearly half
feel hamstrung by their
cost cutting focus...
...and most say they
over-emphasize
quarterly results.
75% 75%
75%
74% 49% 58%
68% 46%
13%
22% 22% 14% 12%
22% 20% 10%