What CEOs learned from the crisis
PwC’s «CEO Panel Survey» captures the sentiment and outlook of almost 700 CEOs on how the impact of the pandemic might filter through to the long term. The study was conducted in June and July 2020 as an extension of «PwC’s Annual Global CEO Survey», and it illustrates which initiatives companies should consider to meet their customers’ changing needs and the new requirements of their workforce.
The surveyed CEOs represent small and large firms, private and public companies, and a diverse cross- section of industries, countries and regions worldwide. While companies have taken many short-term steps to fight the consequences of the economic and social lockdown measures, they have identified three enduring key issues to address: their companies’ digital infrastructure, the digitisation of products and services, and flexible and safe working models.
After having brought large parts of the economy and countless businesses to a standstill, the pandemic quickly forced companies to review their business models and processes and to test new revenue opportunities. The most immediate challenges executives faced was the inability to conduct business in person or onsite. On the one hand, they had to make sure that employees could work remotely; on the other hand, they needed to enable customer access to products or services without physical interactions. And some of these fundamental changes are here to stay.
24 percent of the surveyed CEOs say that the digitisation of core business operations and/or processes is the top priority going forward; for 61 percent, digitisation ranks among the top three issues. Setting up a company’s digital infrastructure or enhancing its digital capabilities encompasses not only technological but also cultural factors, and must be supported from the top. After COVID-19, business models will also be more digital as remote collaboration becomes the new normal.
«Executives face the additional challenges of not only adhering to existing laws, but also anticipating where legislation in the often-unchartered territory will go.»
Automation and remote collaboration are here to stay
The digitisation of internal processes, of course, has a direct impact on a company’s level of automation, supply chain security, service delivery and employee interaction both among themselves and with customers. In the wake of the pandemic, remote collaboration and automation have gained significant momentum; 78 percent and 76 percent of CEOs believe this shift to remote collaboration and automation, respectively, will be permanent. This begs the question of whether the profiles of executives will continue to change even faster as leaders with digital experience and know-how in all functions are required to drive digital infrastructure. Furthermore, what enables companies to maximise efficiency and realise the full potential of their digital and automation investments along end-to-end processes?
Companies whose senior leadership is actively involved in digital initiatives are more successful in their transformation projects .
Due to a highly developed home market and pressure from high domestic costs, Switzerland has fared quite well in terms of digital transformation. In order to compete globally, Swiss companies needed to put a clear focus on efficiency long before the pandemic – which enabled them to react quickly. Nevertheless, digitisation will further speed up, especially in terms of remote collaboration. Besides the need for more flexible work models, it will be important for Swiss companies to install efficient recruiting processes and professional hiring practices. More than half of the study participants (54 percent) think the trend away from traditional employment and towards the gig economy, where organisations hire independent workers for short-term projects, will last.
The shift to more flexible ways of working has clear benefits – but also practical implications for how companies approach issues like healthcare and employee development. Providing workers with both flexibility and job security remains a challenge.
New world. New skills.
Everyone should be able to live, learn, work and participate in the digital world
And what about the consumers?
The outbreak of COVID-19, and its consequent measures such as the lockdown and social distancing, has deeply affected consumers’ buying habits and spending patterns. Customers have become more appreciative of digital solutions, as they were not able to consume physical products and on-site services during the pandemic, thereby creating a market-side pull for new virtual products and services.
Against this background, companies must do more than just collect and evaluate customer data. Actions should follow, a pleasing customer experience must be created – and to truly satisfy and retain the customer, this experience should be personalised. Data protection and building trusting relationships are paramount. Executives face the additional challenges of not only adhering to existing laws, but also anticipating where legislation in the often-unchartered territory will go.
In Switzerland, the health industry and financial service providers in particular stated a need to further virtualise their product offering – and these crucial domestic industries may lead the way. The Swiss health industry had a head start with pre-existing telemedicine and digital patient services already in place before the pandemic. However, the public’s acceptance of and demand for such digital medical services has surged in recent months, forcing service providers to adapt and optimise their offerings and interaction points. This trend is not restricted to Switzerland: CEOs of health companies worldwide are most likely to prioritise increasingly virtual business models, followed by TMT (technology, media, telecommunications) and financial services executives. Swiss banks need to close the digital gap between themselves and competitors abroad by offering better digital products, despite advantages such as their tradition and high level of confidentiality.
Last but not least, the pandemic has thrust supply chain security and management into the spotlight. 58 percent of CEOs say ensuring supply chain safety is a key application of digitisation; two in five CEOs stated that there will be a permanent shift towards onshoring and insourcing, and the same share expects an enduring trend increase in nationalism. But irrespective of the different views on globalisation, in reality, companies’ supply chains rely directly or indirectly on a global ecosystem of suppliers. So, shifting supply chains is not an easy task, even if it is the desired outcome.
PwC’s “Global Consumer Insights Survey 2020
For more insights on consumer behavior read «Reinventing the consumer purchase journey»
What you should know about the future
The pandemic has changed the business environment and customers’ needs and expectations – and some of these shifts are here to stay:
- 76 percent of the surveyed CEOs believe the trend to automation will be permanent
- 24 percent say that the digitisation of core business operations and/or processes is the top priority going forward
- 78 percent of the study participants believe the shift to remote collaboration will continue
- 54 percent think the trend away from traditional employment and towards the gig economy will last
- two in five CEOs stated that there will be a permanent shift towards onshoring and insourcing
- TMT, healthcare and financial services are the sectors that prioritise digital business models most
- increasing companies’ digital maturity and building unique customer experiences and trusting relationships are key
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