Accenture: make the most of tech investments
MAKING the most of tech investments is a key issue for CEOs as every business, whatever the industry, is increasingly turning to technology-based innovation to find the competitive edge.
And the Your Legacy Or Your Legend? report from professional services company Accenture aims to help CEOs get the most out of new technologies as their research, based on the largest survey of enterprise systems to date, shows most are not getting full value from their tech investments.
Having surveyed 8,300 companies, the report shows just 10 per cent were Leaders whose businesses grow revenue at more than two times the rate of the Laggards, those in the bottom 25 per cent of the study group.
Written by Accenture’s Chief Technology And Innovation Officer Paul Daugherty, Group Chief Executive Accenture Technology Services Bhaskar Ghosh, and James Wilson, Managing Director, IT And Business Research, the authors believe most companies are making sub-optimal decisions about how to direct their tech investments.
With C-level executives having to move quickly, they allow business unit, product or geography heads to make decisions affecting their areas which results in highly customised systems operating in isolated pockets of the organisation, gradually becoming ever more difficult to update and modify each system.
The systems are unable to work together at a time when the nature of technology is increasingly dependent on platforms, ecosystems and large varieties of connected data to fuel AI systems, so it means information that might spark enterprise innovation isn’t shared.
The report states: “If they stay this course, CEOs run a real risk of failing. They need to get on a path to Future Systems. It’s a radically different approach – and an innovation and value multiplier.”
According to Accenture, Future Systems are:
- Boundaryless – they blur the boundaries between the IT stack (data, infrastructure, and applications), humans and machines, and organisational and industry silos.
- Adaptable – providing scalability and strategic agility by seamlessly adapting to busines and technology changes, and have flexible, living architectures and new ways to protect and nurture data.
- Radically Human – they empower humans to interact with machines such as through natural conversations and simple touches, and they adapt to humans, not the other way around.
Setting out to determine what an optimal tech investment path should look like, the authors engaged with C-level executives – half were in IT roles – at more than 8,300 companies across 20 industries in 20 countries, including 885 CEOs, to identify those that were getting the most from their investments and those that weren’t.
They collected data on the companies’ adoption of certain technologies, those technologies’ penetration (the extent to which they were in use through the company), and the culture changes (for example, changes in mindset around experimentation and collaboration) that the companies made as they adopted those technologies.
They found Middlers (the middle 20 per cent) grow revenue at more than 1.5 per cent of Laggards (the bottom 25 per cent), but Leaders (the top 10 per cent), grow more than 50 per cent faster than Middlers, and more than twice the rate of Laggards.
In 2018, Laggards left 15 per cent of their annual revenue on the table which will increase to 23 per cent by 2023 in both Leaders and Laggards continue their current trajectories.
The report introduces PATHS, the five key decision points CEOs reach when investing in technology where Leaders make the right choice in each area to establish effective innovation models and build Future Systems, and get the maximum value out of their efforts.
- Progress – How extensively/broadly should we apply new technology to evolve business processes across the enterprise?
- Adaptation – How do we adapt our current IT investments to changing business needs?
- Timing Of Tech Adoption – How do we properly sequence and map our adoption of new technologies?
- Human+machine workforce – How do we activate and enable the workforce to use and be augmented by technology?
- Strategy – How can we intentionally manage the intersection of business strategy and technology strategy?
Leaders pursue the action that will create a building block, allowing the organisation to share and scale innovations repeatedly across business units and processes, while Laggards most often choose easy fixes that create siloed systems, or even fail to decide at all, and Middlers tend to mix and match.
Accenture has three essential steps to getting started with Future Systems and put your company on the PATHS to innovation, ready to face decisions at every juncture:
- Assess your company’s current position – Identify technology investments specific to processes, geographies and functions. Measure diminishing returns and opportunity costs.
- Reconsider your sunk tech investments – Work with your IT leads to see which can be consolidated or applied across other parts of the business to drive efficiencies and improve returns. Also align around a set of KPIs to track progress.
- Design a new Future Systems strategy – Using the PATHS framework, base it on enterprise-wide needs so it can adapt to the changing nature of employee, partner and customer habits.
Accenture’s Future Systems Diagnostic, based on 1.6 million data points from more than 8,300 companies and driven by econometric and decision tree models, can recommend a custom plan for guiding companies in their evolution for future systems, and the full Your Legacy Or Your Legend? Report can be downloaded at https://www.accenture.com/us-en/insights/future-systems/enterprise-innovation-model
5 minutes with... Janthana Kaenprakhamroy, CEO, Tapoly
Founder and CEO of award-winning insurtech firm Tapoly, Janthana Kaenprakhamroy heads up Europe’s first on-demand insurance platform for the gig economy, winning industry awards, innovating in the digital insurance space, and leading with inclusivity.
Here, Business Chief talks to Janthana about her leadership style and skills.
What do you do, in a nutshell?
I’m founder and CEO of Tapoly, a digital MGA providing a full stack of commercial lines insurance specifically for SMEs and freelancers, as well as a SaaS solution to connect insurers with their distribution partners. We build bespoke, end-to-end platforms encompassing the whole customer journey, but can also integrate our APIs within existing systems. We were proud to win Insurance Provider of the Year at the British Small Business Awards 2018 and receive silver in the Insurtech category at the Efma & Accenture Innovation in Insurance Awards 2019.
How would you describe your leadership style?
I try to be as inclusive a leader as possible. I’m committed to creating space for everyone to shine. Many of the roles at Tapoly are performed by women and I speak at industry events to encourage more people to get involved in insurance/insurtech. Similarly, I always try to maintain a growth mindset. I think it’s important to retain values to support learning and development, like reliability, working hard and punctuality.
What’s the best leadership advice you’ve received?
Build your network and seek advice. As a leader, you need smart people around you to help you grow your business. It’s not about personally being the best, but being able to find resources and get help where needed.
How do you see leadership changing in a COVID world?
I think the pandemic has proven the importance of inclusive leadership so that everyone feels supported and valued. It’s also shown the importance of being flexible as a leader. We’ve had to remain adaptable to continue delivering high levels of customer service. This flexibility has also been important when supporting employees as everyone has had individual pressures to deal with during this time. Leaders should continue to embed this flexibility within their organisations moving forward.
They say ‘from every crisis comes opportunity’, what opportunities do you see?
The past year has been challenging, but it has also proven the importance of digital transformation in insurance. When working from home was required, it was much harder for insurers to adjust who had not embedded technology within their operating processes because they did not have data stored in the cloud and it caused communication delays with concerned customers at a time when this communication should have been a priority, which ultimately impacts the level of customer satisfaction. This demonstrates the importance of what we are trying to achieve at Tapoly in driving digitalisation in insurance and making communication between insurers and distribution partners seamless.
What advice would you give to your younger self just starting out in the industry?
Start sooner, don’t be afraid to take (calculated) risks and make sure you raise enough money to get you through the initial seed stage.