In every race, the winners tend to share commonalities. Right now, the companies growing faster than their peers have done so with a winning combination of investment in technology and talent. Those falling behind tended to bet their revenues on improving legacy systems. This is just a sample of the insights that have emerged from KMPG’s report on Harnessing Disruption for Growth.
The study aggregated answers from hundreds of international execs at companies with valuations ranging from $500 million to $100 billion. Analysts have parsed the data, culling the most valuable information on how global markets and market winners operate today.
The core message is that those who have posted strong growth numbers despite massive market changes are those who have prioritized talent with sales education and experience with emerging technologies. The companies have pursued a three-fold strategy of retraining employees, deploying technology for better agility and solidifying company culture that has resulted in a decisive competitive advantage.
Market Leaders Vs. Trailers
The report detailed how a slightly different approach to disruption can have vastly different outcomes with revenue and market share. Market leaders tend to define industry specific disruptors as opportunities, while trailers listed the same factors as challenges. This is a good example of an age-old maxim brought to life. Listed disruptors include:
- Accelerated growth of the digital enterprise
- Instantaneous and ubiquitous access to data
- Global business complexity for their industry
- Regulatory and legislative complexity
- Disruptions to the global supply chain
- Unexpected deflation, inflation, and uneven or slowing growth
The report cited Tesla as a company that took “Disruption to the global supply chain”‘ as an opportunity instead of a challenge. Tesla used its new supply chain as a springboard for differentiation and customer engagement. Similarly, Northwest Regional Banks used “Regulatory and legislative complexity” to redefine the role of banks in local communities, offering yoga classes and displaying the works of local artists.
Figure 1: KPMG visual comparing the differences of the fastest growing firms versus the slowest growing firms. As shown, the fastest growing firms spend more on technology and talent.
Top Three Priorities
Although all companies surveyed did reveal how decision-making becomes harder as the speed of business increases, market leaders found an edge. They prioritized three changes that simplified decision-making:
1. Incorporate greater use of emerging technology
2. Develop and acquire experts; build in-house capabilities
3. Apply greater use of data and analytics
Companies that made only slight improvements to older decision-making methods were at a critical disadvantage. More extensive use of emerging tech depends on having talent in place that knows how to use it in the right way. This is why many market leaders have invested heavily in sales training involving the latest tech. In fact, mentoring programs have turned into a two-way street, with younger employees mentoring senior execs on technology, and the execs reciprocating in advice based on industry experience.
Five Questions for Growth
Here are five questions posed by the report to help businesses align their top priorities and adopt the strategies of high growth companies:
1. Have you mapped out and addressed your unique buyer’s journey?
2. Are the pathways to profitable customer growth in place and in motion?
3. Do you have the technology in place to know what motivates your customers?
4. Are your employees empowered with social selling training to promote profitable customer behavior?
5. Are you observing how industry disruptors can lead your company to differentiation?
Even though three out of four execs see disruption as a constant that will only increase in the future, only 17 percent of them felt ready to handle it. Where does your company stand?