What is the CEO’s role in facing threats and opportunities of digital transformation? The rapid change in business models and technologies has to be based on a culture of innovation shared throughout the organization and the organizations’ ecosystem. CEOs should be the engine of this transformation.
Digital Transformation and the CEO’s role
The Cap Gemini Research / Business International study “Changing the game. The role of the CEO in the era of digital disruption” has investigated how and how much Italian CEOs drive the cultural change needed for innovation.
CEOs have been classified into 1) Leader, 2) Sponsor and 3) Neutral based on their view about the cultural change related to digital disruption.
- Leader. 44% of the CEOs interviewed directly guide the cultural transformation
- Sponsor. 32% of the CEOs, while maintaining their commitment, delegates the transformation to Senior Management
- Neutral. 24% of the interviewees believe that the culture of their organization is already adequate, so they don’t take any further initiative
CEO’s role and revenues from innovation
How do organizations perform when the CEO does not consider it a necessity to activate / guide cultural change initiatives aimed at supporting innovation? Not very well.
Only 21% of organizations with the CEO who do not support (Neutral) cultural change in digital transformation, manage to generate significant revenues (over 20% of the total) from innovation
CEOs in Neutral category believe that the organization naturally evolves towards an innovation culture consistent with the changes in technologies, econoy and society. But a low rate of innovation revenues and cash flows shows how the organizations led by these CEOs lag behind in the digital transformation, with the risk of constantly falling behind their competitors.
CEOs, organizations and cultural change in the age of digital disruption
Quali sono le azioni che i CEO attivano per il cambiamento culturale a supporto dell’innovazione? Le principali aree di attenzione sono le seguenti:
- Role modeling and more traditional approaches such as face to face meetings are used by the majority of CEOs (58% and 53% respectively
- The removal of barriers between information silos, the Agile Approach and the use of dedicated and cross-functional Teams can greatly increase company performance, but require different experience and management methods to reach their potential.
- The development of Agile and growth-oriented mindsets in individuals and teams is fundamental
- When company boards are more involved in daily operations or in compliance with regulations and legislative constraints, issues relating to innovation are dealt with informally and often without receiving the right attention.
- Constant monitoring of competitors but also of Tech Giant such as Google, Facebook, Amazon, Netflix, Microsoft, Apple as source of inspiration and potential future competitors