An era of seismic changes—with new middle-class consumers and fast-globalizing competitors from emerging markets as well as innovative business models arising from the development of the new technologies— presents CEOs with a golden opportunity to galvanize their companies, according to Hans-Paul Bürkner, president and CEO of The Boston Consulting Group (BCG).
But, if leaders are to capitalize on these trends and guide their companies through the economic gloom to a better future, they will need to take some “bold bets” and “intelligently aggressive” action, he added.
“The challenges confronting CEOs are large, and getting larger,” he says. “There are many new middle-class consumers in the emerging markets who have continuously changing needs, there are new competitors from the emerging markets with different ways of doing business, and there are new business models created by disruptive technologies. Never before have corporate leaders faced such a convergence of major transformative events. This truly is an era of seismic change—and it presents today’s managers with a once-in-a-generation test of leadership.”
“To pass this test, CEOs must take decisive action. They should not hunker down and try to preserve the status quo. Yes, there are risks—but the opportunities are greater. So they should be making some bold bets: entering new markets, acquiring struggling competitors, investing in marketing and new products and services, making the most of digital technology, creating new business models, and building adaptive organizations.”
Addressing developed markets specifically, Bürkner said that today’s senior managers in the U.S. and Europe cannot afford to stand still—otherwise, they risk leading their companies into terminal decline.
“Companies from China, India, and other emerging markets are rightly charging ahead. So to compete, you need to make more changes more frequently than the previous generation of corporate leaders has. If you don’t take these steps, your company could lose advantage, market position, and even its right to exist.”
Bürkner’s prescription for corporate success chimes with the recommendations of some senior business leaders featured in Leading Transformation, a major new BCG study on the challenge of orchestrating organisational change.
The study found that executives regarded the challenge of transformation as a mission rather than simply a job and found ways to:
* Deliver ambitious goals in 1-3 years by building on a bedrock of bold moves
* Fund the organisation’s transformation by freeing up cash and resources and/or unleashing the necessary political capital
* Build the right team with a shared mindset and commitment—since even the best-laid plans will fail if people are not on board
MORE ARTICLES ON MANAGEMENT