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1、12/06/2023INDEPENDEN T P U B L I C AT I O N BY#0872R AC O N T EU R.NE TINSIGHT.IDEAS.IMPACT.ambitiouspr.co.ukStrategic communicationthat drives success.BUSINESS TRANSFORMATIONWHY MUTABLE IS THE ULTIMATE STRUCTUREWILL GENERATIVE AI AID OUR CREATIVITY?0906GAUGING THE RETURN ON CHANGE PROJECTS14R A C O
2、 N T E U R.N E T0302B U S I N E S S T R A N S F O R M AT I O Nraconteurraconteur.storiesDistributed inhange fatigue among employees is becoming a problem for significant numbers of firms.In extreme cases,it can even end up derailing a transformation.Largescale change projects undeniably remain a str
3、ategic priority for many businesses,but a key threat to their success is that people can only take so much upheaval,particularly since the Covid crisis.Research by Gartner suggests that the tolerance of most employees for further disruption has already been stretched to the limit.The consultancy con
4、ducted two employee surveys,in 2016 and 2022,that asked a similar set of questions.It found that the average respondent had experienced two planned workplace changes in 2016.Such changes included departmental reorganisations and the introduction of new working methods.In 2022,that total shot up to 1
5、0.Nearly threequarters(74%)of respondents to the 2016 survey had expressed a willingness to embrace change.In 2022,that total plunged to 38%.A survey of almost 1,000 US workers by online marketplace vendor Capterra last year produced similar results.It asked them:“How much do you agree or disagree w
6、ith the statement Im overwhelmed by the amount of change that has taken place at my job?”Only 23%said that they disagreed to any extent.Nearly half(48%)of the respondents reported being stressed and tired at work as a result of change fatigue,while 32%felt that it had made them less productive.Of th
7、ose who reported experiencing such fatigue,54%were considering a change of employer.Clearly,such outcomes are the opposite of what most transformation projects are trying to achieve.Whats going wrong and,more crucially,what feasible measures can employers take to combat change fatigue and its pernic
8、ious effects?A 2011 US research report entitled Change Fatigue:development and initial validation of a new measure characterises the condition simply as a“perception that too much change is taking place”.But Karen Jansen,professor in leadership and change at Henley Business School,offers a more spec
9、ific description.“This is about frequent and urgent highintensity changes,granting very little downtime to recover,”she says.“There was so much change during the pandemic.When we came out of the Covid crisis,people were suffering from burnout.That was followed by a lot of geopolitical and economic i
10、nstability.Its been a perfect storm.”Sophie Seex,managing consultant at talent management specialist Talogy,agrees.She says that change fatigue is becoming more problematic because the world has entered“apermacrisis situation.People are already in a highthreat state owing to whats happening external
11、ly,so theyre likely to experience change fatigue more quickly than they might have done in the past.”The syndrome typically manifests itself in two ways among those it affects.The first is the onset of weariness and lethargy.The second is a decline in engagement with work,often resulting in a deteri
12、oration in performance and the withdrawal of discretionary effort.Sufferers will also tend to become more cynical about their employers stated intentions and resistant to further change.“Theres some commonality with burnout in the fact that theyre both about overload,”says Seex,who is also an occupa
13、tional psychologist.“Some of the symptoms might therefore be similar,such as people feeling stressed,withdrawing and going off sick.But the causes are different.”The main difference between the two is that burnout concerns physical and mental exhaustion at a personal level,usually resulting from the
14、 individuals prolonged exposure to excessive stress.Change fatigue,on the other hand,is generated at an organisational level although it can lead to burnout too,as Seex explains.“Our brains love stability.We may struggle if conditions are disruptive and psychologically unpredictable,because that fee
15、ls threatening to us.It takes more energy to do things Cath EverettBUSINESS TRANSFORMATIONHow to prevent an outbreak of change fatigue syndromePeople will grow sick of seemingly endless reorganisations.Employers therefore need to take measures to keep staff as engaged and motivated as possible throu
16、gh the disruptionO R G A N I S AT I O N A L B E H AV I O U RCraconteur-media/business-transformation-Although this publication is funded through advertising and sponsorship,all editorial is without bias and sponsored features are clearly labelled.For an upcoming schedule,partnership inquiries or fee
17、dback,please call+44(0)20 3877 3800 or email Raconteur is a leading publisher of special-interest content and research.Its publications and articles cover a wide range of topics,including business,finance,sustainability,healthcare,lifestyle and technology.Raconteur special reports are published excl
18、usively in The Times and The Sunday Times as well as online at The information contained in this publication has been obtained from sources the Proprietors believe to be correct.However,no legal liability can be accepted for any errors.No part of this publication may be reproduced without the prior
19、consent of the Publisher.Raconteur MediaOliver BalchA British journalist and writer,with 20 years experience of writing about all aspects of the sustainability agenda.MaryLou CostaA writer who specialises in the future of work but also covers topics such assustainability,tech,innovation and startups
20、.Cath EverettA journalist of 30 years standing who specialises in workplace issues,including what it means to be an ethical business.Bernard Marr Raconteurs tech columnist is a worldrenowned futurist,influencer,thought leader and bestselling author.Rich McEachran A freelance journalist covering the
21、intersection of business,technology and sustainability for a range of publications.Mark Walsh A New Yorkbased freelance writer who specialises in covering business,technology andthe media.Daniel ThomasA writer and editor whose work has been published by outlets including TheTelegraph,Newsweek and Fu
22、nd Strategy.ContributorsReports editorIan DeeringEditorSarah VizardSub-editorChristina RyderChief sub-editorNeil ColeCommercial content editorsLaura BithellJoy PersaudDeputy reports editorJames SuttonDesignKellie JerrardHarry Lewis-IrlamColm McDermottSean Wyatt-LivesleySamuele MottaDesign directorTi
23、m WhitlockIllustrationCelina Lucey Sara GelfgrenPartnerships account directorSiri Muang GreenHead of productionJustyna OConnellAssociate commercial editorPhoebe BorwellDelmaine Donston via GettyCHANGING EXPECTATIONS AND CONFLICTING PRIORITIES PLAGUE MANY TRANSFORMATIONSShare of C-suite members citin
24、g the following as barriers to achieving the expected outcomes of a business transformationChanging expectations75%Legacy systems65%Lack of guidance60%Macroeconomic trends59%Blurring between collaboration and competition55%Conflicting priorities72%Shortage of talent62%Change management59%Lack of fin
25、ances56%Lack of commitment55%Deloitte,2022LONDON2023BUSINESSSHOWTHEPublished in association withR A C O N T E U R.N E T0504B U S I N E S S T R A N S F O R M AT I O N differently and deal with whatever may come as a result.Thats when burnout can occur,”she says.Ben Collins,partner at business transfo
26、rmation consultancy Oliver Wight EAME,highlights some other telltale signs that change fatigue may be sweeping an organisation.“A common one is that employees start asking the same questions over and over,as they dont understand why certain changes are taking place and cant buy into them,”he explain
27、s.“Another is that youre ending up with more long,painful projects that go on well past their deadline as people lose commitment and become less productive.”One way to make transformations more sustainable is to ensure that everyone knows why a big change is occurring and whats ultimately in itfor t
28、hem.So says Pat Lynes,founder and CEO of change consultancy Sullivan&Stanley.Successful business leaders work hard to ensure that everyone is pulling in the same direction,from directors to frontline workers,he stresses.“Theyre all aligned with the organisations vision,purpose and intent.Everyone op
29、erates as one team.”Business leaders therefore have a key role to play as“storytellers of change”,Seex says,because how they position a narrative can make the difference between“people wanting to join the party or leave the business”.They would also be wise to encourage people to share their views(a
30、nonymously,if necessary)about the transformation plan,at the very least to understand possible hidden flaws and potential areas of resistance to it from employees.Another way to mitigate the risk of change fatigue is to ensure that all of the companys change projects are considered in the round rath
31、er than treated in individual silos,as is typically the case.They should also be clearly aligned with the overall corporate strategy.“You need to look at change projects holistically and ask:will these move the needle of business performance?”Collins stresses.“If theywill,they should then be evaluat
32、ed centrally to better understand whether the right resources and capabilities are in place to ensure that theyre all successful.”Projects that are deemed unlikely to move the needle should be scrapped so as not to put extra pressure on a changeweary workforce for little chance of meaningful gain.Th
33、ey should also be prioritised,so that employees dont become confused by conflicting requirements.Seex notes that“people are more likely to feel excited and see your inspiring vision if you put more resources in to help,but many organisations ask a lot of them without creating the right conditions.”C
34、reating the right conditions includes ensuring that employees are given the guidance,training and coaching they need.It also entails forming the appropriate psychological foundations to make sure that they have an“open rather than defensive mindset,which is all about fightflight”,she adds.A widely a
35、ccepted model for influencing and collaborating was proposed in 2008 by David Rock,cofounder of the NeuroLeadership Institute.Its known by the acronym Scarf,which stands for five key“domains”that influence peoples behaviour in social situations.These are:status(how valued you feel by the group);cert
36、ainty(your ability to predict what will happen);autonomy(your sense of control over whats happening);relatedness(how comfortable you feel with others);and fairness(your sense that people are interacting equitably).Change can have an impact on any of these five domains,potentially making you feel anx
37、ious or even threatened.gorodenkoff via GettyPhil Wilding was appointed managing partner at Wright Hassall in 2022,just when the law firm established in 1846 had been through some big changes.As well as introducing new methods,it had replaced its practice management system,which was a core piece of
38、IT.Soon after Wilding took over,he added a cultural change programme to the list.To this end,he reorganised the business and took on three new managers.“Even before Covid came along,there was change fatigue here,as wed had a to-do list as long as your arm that kept being added to,”Wilding recalls.To
39、 address the situation,he sat down with his team to define the firms vision and goals.Top of the list was to make Wright Hassall an“exceptional”place to work and improve employee retention.“Whenever we do anything new,we first consider exactly what were trying to achieve with it and how that will co
40、ntribute to our wider objectives,”Wilding says.“This is about everyone working towards the same goals,knowing that they all have a part to play.”To do this effectively requires genuine two-way communication,he stresses.Thatentails both ensuring that everyone understands why a change is needed and li
41、stening to their feedback.Wilding also advocates democratising project delivery.While managers set the framework,their teams now decide how to implement any given initiative.“Treating people like grown-ups is empowering,”he says.“It makes a real difference to engagement.”Unless a temporary break has
42、 been planned into a business transformation initiative,it can be tricky to implement.In the case of compliance projects,for instance,deadlines tend to be fixed and the ramifications of missing them can be severe.This means that pressing pause becomes“near impossible”,says Ben Collins of Oliver Wigh
43、t EAME.But the same is not always true of lower-priority initiatives if a hiatus is deemed necessary to tackle or,ideally,prevent an outbreak of fatigue.In such cases,its possible that deadlines can be pushed back,employees temporarily stood down and freelancers brought in to fill any gaps,if budget
44、s allow.“It depends on the kind of initiative,”Collins says.“But there may be ways to reduce pressure on people and be flexible with resources.You need to consider whether its a firm deadline and ask yourself:Could we redeploy or retrain staff,or build in resilience by,say,giving people time away fr
45、om the project for the first week of each month so they can focus on their day jobs?”To make this approach work,its important to take an overview of all thechanges taking place across the organisation and understand the cadences of the teams affected.“If you can ease down the pressure on them at cer
46、tain times of the month,itll help to build resilience,”Collins says.“These tactics are important,as the relentless nature of it all wont change.That is why planning and building in mitigation factors early on is so vital.”Case study:making change less of a right hassleIs there ever a case for pausin
47、g a project?1074%38%Gartner,2023The number of planned enterprise changes the average employee has experienced in the past 12 monthsof employees expressed their willingness to support organisational change in 2016expressed willingness to support organisational change in 2022But onlyCommercial feature
48、eing data-driven has become a bit of a buzzword,but for many organisations,a data strategy is still in development.Data innovation is often also stifled by budget limitations or by organisations not knowing how to get the most out of the tools and technology available to them.It can therefore be dif
49、ficult for leaders to understand the return on investment for data platforms.They may know theres immense benefit in gleaning insights into their business and customers,but getting to that point and quantifying that value is more challenging.Investment in data isnt slowing down,with data leaders exp
50、ecting to invest 63%more in existing data and AI plat-forms and 69%more in new platforms by 2025,according to the Databricks and MIT CIO Vision 2025 report.So how can they justify the costs and enable the shift to a culture that recognises datas potential for profit?How should organisationsapproach
51、costs?One metric used to understand the overall value of an investment in a service or platform is the total cost of ownership(TCO),a financial estimate Understanding the business value of dataYann Lepant,Europe data and AI delivery lead at Accenture,says one of the biggest issues organisations face
52、 is looking at how to go from data being a by-product of IT to it becom-ing a business asset.“The hard bit we see with a lot of our clients is learning how to build the right strategy on how youre going to exploit data and meas-ure the value,”says Lepant.“With a number of clients,we work with CFOs t
53、o turn that data into some-thing you can put in a balance sheet suddenly,youre building business cases you can actually report on.”At the core of making the most of,and quantifying,the value of data is a robust data strategy.“You need to have the right data strategy,or rather a data and AI strategy,
54、because AI is increasingly at the centre of what operations are trying to scale up,”says Lepant.Harrison notes the contradictory objectives data teams face when they have to justify costs and do more with less,as well as drive the most value from data.“Data needs across the business are growing,and
55、the out-comes data is meant to be driving are increasing.But,all of a sudden,youre meant to do everything just so much cheaper than you are cur-rently.And theres a tension there.”She stresses that cutting corners is not the way to go.Theres no point investing in cheap data thats barely going to make
56、 a difference to busi-ness outcomes.The case for simplification and consolidationAnother challenge for organisations is complexity.Harrison says:“What weve seen over the past 10 years is this explosion of tools and partners.All these elements have ended up creating really complex ecosystems for maki
57、ng data available in the business and then being able to move it around.”She continues:“One of the things that I think is key,and a big shift were going to start to see in the industry,is around consolidation and simplification.”For large,complex organisations,simplification will mean reducing the t
58、ech stack and moving towards more efficient,self-service architectures.Enabling agility with adaptable and scalable tools is also crucial,says Harrison.“You might not be doing data science now and being predic-tive,but you know thats going to come down the line.So how are you creating an environment
59、 that will give you the agility and speed to be able to upskill quickly when those capabilities become relevant to yourbusiness?”Expanding the data ecosystemWhile some organisations are still refining their basic data strategy,others are starting to look to devel-opments on the horizon around data d
60、ecentralisation and emerging tech-nology.As a leader in a highly-regu-lated industry,Wedeniwski sees great potential in data and artificial intel-ligence being used to simplify and automate time-consuming and com-plex work.For example,it could allow architects to stop spending too much time on gover
61、nance issues and focus more on creative and strategic tasks.Wedeniwski believes it is important to move beyond silos,both internally and across the whole business eco-system,to find opportunities for data sharing.However,he notes that there are questions to be answered around data ownership and who
62、is ultimately responsible for how data is being shared and used.Harrison agrees that there can be a mutual benefit in data exchange between partners and customers.This works best in non-competitive relationships.For example,sharing information may be useful in man-ufacturing to manage the uptime of
63、equipment,but less so in retail,where information about consumers is a competitive advantage.Lepant concludes:“I think the next step could be interesting to see,where data is itself the product and is being augmented across the eco-system to be enriched at the end,not just by one party,but as a chai
64、n.”Its all new and exciting territory.And its clear that,despite a gloomy economic outlook,the sheer value of data as a currency makes it a key area to invest in.Its an important time for organisations to get a handle on their data and foster a culture ofinnovation.To find out more,visit of the tota
65、l cost of a product across its whole lifecycle.Sebastian Wedeniwski,chief tech-nology officer at Deutsche Brse since April 2023,suggests that TCO for data platforms should be cat-egorised into three primary areas.The first area is infrastructure costs,including the initial investment,operational cos
66、ts,energy consump-tion and labour costs.The second area is the cost of downtime,which is difficult to measure but includes factors such as reputational damage.The third area is hidden costs related to the efficiency and value of the data.“How much of the data is copied?”he asks.If there is duplicati
67、on and redundancy,“youll have a higher infrastructure cost,higher mainte-nance costs and higher energy con-sumption costs.”Kate Harrison,senior man-ager,business value consulting at Databricks agrees about the impor-tance of expanding the scope of TCO beyond infrastructure costs:“If were taking a po
68、int of view that data is an asset,its maybe a bit more than just the infrastructure costs that are tied to the total cost of owning and using that data.”Beyond costs:measuring the value of dataAt a time when big investments are under scrutiny,how can organisations take control of data costs and focu
69、s on value?You need to have the right data strategy,or rather a data and AI strategy,because AI is increasingly at the centre of what operations are trying to scale upB63%increase expected by data leaders to invest in existing data and AI platforms in 2023Databricks and MIT,2022Seex explains:“People
70、 like a bit of change if theyve chosen it,as they generally enjoy some variety and freshness.But,in an ongoing change situation,leaders must find ways to manage the disruption that can generate by minimising threats using emotional intelligence to create feelings of psychological safety.”That entail
71、s being empathetic,reliable and consistent in your behaviour,offering a point of continuity and“stability in a storm”,she says.Another important consideration for those trying to prevent change fatigue is to manage the amount of effort required across the whole workforce to adapt to an ongoing trans
72、formation.It can help to create what Jansen calls“energy maps”based on aggregated input from employees to understand where any problems might be occurring.These maps can be used to visualise fluctuations in energy at the individual,team or wider organisational level and so pinpoint where and when re
73、covery time needs to be factored in.Energy maps can also be used in conjunction with heat maps,which depict how much change is going on in various parts of the organisation.“Once you can see whats happening in different teams,you can start saying lets build in regular downtime there and there,”Janse
74、n says.Adopting this kind of sustainable approach to risk mitigation is vital,given that another techdriven revolution has started to sweep the business world,Seex warns.“Were facing the biggest potential change we may experience in our lifetime with the emergence of generative AI.This will cause a
75、lot of disruption and anxiety,”she predicts.“With that in mind,the time to get good at managing this is now.”R A C O N T E U R.N E T0706B U S I N E S S T R A N S F O R M AT I O NA seemingly endless stream of layoffs is signalling the emergence of a new kind of lean enterprise one where most people m
76、ust find their place as flexible freelancersdisplay for emergency first responders.F is also working on an innovation challenge with the US National Institutes of Health on human gene editing,where scientists worldwide will compete for$6m in prizes.Fs VP of managed services,Bryndis Henrikson,reports
77、 that shes seeing more and more businesses structured around a small internal team augmented by a rotating cast of freelancers.“This is one of the biggest transformations of the nature of large business in history,fuelled by the advance of generative AI and AIpowered freelancers,”she says.Shib Mathe
78、w,YunoJunos founder and executive chairman,has observed a similar shift in recent years.He reports that the ratio of permanent employees to freelance workers in many companies has changed to such an extent that entire project teams are being led by freelancers.“What we see more often these days is a
79、 core team setting the direction of a project and engaging much more specialised skills in an agile way,”Mathew says.Skellett believes that the next step on the way to mutability will concern how people develop their skills to maximise their freelance earning potential.They may need to expand into n
80、ew fields more a case of lateral skilling than upskilling.He stresses that,once mutability becomes the organisational standard,“its no longer going to be about someone on 40 hours a week being paid at a certain rate.Theyll be able to go off,look at the outcomes they can deliver with their own value
81、proposition and work to a more portfoliobased model.”teams of skilled operators working on a flexible,thirdparty basis.Richard Skellett is the founder of Globalution,a group of consultancies working in fields ranging from IT and research to HR and marketing.The adjective he uses to describe this new
82、 organisational model is“mutable”.Mutable enterprises are ditching the traditional model of headcount as a cost and converting it to an outcomebased asset that comes with a direct return on investment,he says.Skellett and his colleagues have helped many big companies to restructure themselves so tha
83、t they become more outcomefocused.A fully mutable enterprise,he says,has entered a“permanent state of reinvention”,which represents the ultimate business transformation.“We tend to look at transformation as the digital piece that is enabling business to be conducted differently,but whats missing her
84、eis a resource transformation,”explains Skellett,who adds that a new tech architecture lacking the resource architecture to match “becomes a big problem.Looking at the transformation programmes that are running at the moment,we have a wonderful opportunity to make this the final transformation and t
85、o have organisationally,as nother month in British business and the redundancies keep coming.Among the latest in the line of layoffs are BTs and Vodafones plans to shed more than 60,000 jobs collectively over the next few years,representing headcount reductions of about 42%and 12%respectively.This d
86、oes not look like a temporary cyclical slump from which the market will eventually recover.The key factors behind this drastic downsizing trend automation and the need to simplify operations point to the emergence of a new kind of organisation.So what will this company of the future look like?Growth
87、 numbers recorded by freelance hiring platforms and predictions from futurists suggest that it will take the form of a small core of leaders and managers engaging and overseeing MaryLou Costa39%51%49%Upwork,2022of the US workforce was composed of freelance workers in 2022of those freelancers were wo
88、rking in the knowledge economywere educated to at least degree levelwell as individually,an operating model that enables this permanent state of reinvention.”He believes that mutability is a universal model that will eventually apply to all organisations across all functions once two distinct workfo
89、rces AI and human have established their roles.“Everything will be affected,”Skellett predicts.“Were already seeing the formation of organisations where there are few people in the business because theyre so automated.The investment community expects to see the emergence of businesses that can achie
90、ve 90%profit margins with very little human interaction.”He stresses that the human workforce wont necessarily lose out in this situation.People will need to alter their own operating models as the idea of pursuing a port folio career becomes more realistic.One benefit of this,Skellett suggests,is t
91、hat firms may be able to free up more funding for projects that they previously considered nice to do but inessential enough to leave on the ideas page.As a result,many people may get the chance to do more rewarding work.Platforms specialising in hiring freelance workers for instance,Catalant,F and
92、YunoJuno have reported a surge in demand as employers seek a more agile way to staff their projects and people seek to operate more on their own terms,with compensation to match.Catalant has more than 80,000 independent consultants on its books.In 2021,it saw a 42%yearonyear growth in the number of
93、businesses using its marketplace of freelancers,thousands of whom had been staffers at big consultancies such as McKinsey and Bain.Many of them work regularly on projects for bluechip companies,with several earning more than$500,000(400,000)a year,according to Catalant.Between July and September las
94、t year,296,000 freelance jobs were posted on F,which saw a particular growth in demand for people skilled in app development on the Android mobile operating system.As long ago as 2015,the platform started working with the US government and Nasa to find people for complex projects in fields such as e
95、lectrical engineering and data science.The most recent of these developed an augmentedreality Why mutable enterprises may prove most suitableWe have a wonderful opportunity to make this the final business transformationO R G A N I S AT I O N A L S T R U C T U R EACommercial featureMulti-brands must
96、flex their tech muscles to surviveThose daring to embrace change in their mindset and their tech stack will stand the test of timeany of the worlds most prof-itable companies are mul-ti-brands:that is to say,busi-nesses with a portfolio of products with different brand names,all owned and managed by
97、 the same company.As a rule,these multi-brands have worked their way to the top with money and muscle,their significant adver-tising spend having guaranteed the acquisition of customers.But times have changed.Big tech has shown that a different path is possible and potentially more powerful.In this
98、new economy,experience is everything.However,experience can only be cul-tivated,not bought.To survive and stay relevant then,multi-brand businesses should take their cue from big tech and embrace the power of technology to unlock experiences.Its a change which will urgently require a shift in both m
99、indsets and tech stacks.A unique set of challenges Part of the problem,of course,is that multi-brands are uniquely decentral-ised.Revenue,decision-making power and go-to-market strategy often sit away from the corporate core.For brands with a portfolio of hun-dreds or thousands of different prod-uct
100、s,isolated decisions around techni-cal strategy and tech stacks can result in an intricate web of siloed architec-tures.This creates little opportunity to maximise investment or find synergy between brands with feature/func-tional similarity.So,to break free of existing silos and the inflexible orga
101、nisational struc-tures preventing growth,multi-brand businesses must move away from the digital transformation mindset and commit to becoming a fully digital enterprise instead.They must then select the technologies that will pro-vide scalability and consistency of experiences,without compromising o
102、n differentiation or innovation.According to Joacim Jeppesen,chief growth officer at Valtech,all brands will have to become digital enterprises to deliver on customer demands and seal their long-term futures.He warns that failure to do so will“spell the end of those businesses unwilling or unable to
103、 evolve”.“Some of the worlds most modern,resilient and adaptable businesses,regardless of size or industry,are dig-ital enterprises,”he explains,adding that this is not simply down to the technology.“It goes much deeper than that,into the very heart and cul-ture of the organisation.Its about the bus
104、iness being laser-focused and obsessed with customer experience and working as one to continuously drive towards excellence.”The era of the digital enterpriseExperience sits right at the heart of a digital enterprise.Brands can no longer afford to simply transact with audi-ences.Instead,they should
105、be striving for relationships.Creating this connection and long-term loyalty requires a business to unchain itself from traditional silos and embrace a more flexible,nimble approach to technology.That approach,Jeppesen advocates,is“composable”.Such composable architectures(also known as composable c
106、ommerce)are a relatively new concept,challenging the traditional off the shelf,one-size-fits-all technology model.These architectures enable a unified digital experience through a modular approach to technology.Think of it like childrens building blocks,each rep-resenting different tech components.T
107、he business can stack these together in a bespoke and unique way,tailored to the requirements of the wider organisation and its individual brands.By easily adding or replacing com-ponents without disrupting the entire technology stack,multi-brand com-panies can quickly adapt to changing needs,market
108、 trends and brand-spe-cific requirements,helping them get closer to customers.This approach also reduces duplica-tion of effort and resources,making it faster and simpler to expand oper-ations,add new brands or enter new markets.Suddenly,coordinating mar-keting,sales,operations and other functions a
109、cross multiple brands seems effortless rather than a headache.The benefits of composable commerce“When you build your own tech stack as a multi-brand,youre forced to consider key elements of your business as a whole,”says Casper Rasmussen,group senior vice-president for technology at Valtech.“Youre
110、rallying your brand port-folio to co-exist in one digital ecosystem;one in which your brands will benefit wherever there are points of commonal-ity.This value-led approach enables you to maximise the greater good opportu-nity hidden within the organisation.”The benefits of a composable approach to f
111、uture-proofing customer experi-ences are clear.For one thing,com-posable tech can drive an organisation towards a multi-channel,multi-brand,multi-market,multi-currency and mul-ti-region future all while accounting for autonomy and innovation.Global multi-brand organisations are already taking the le
112、ap towards becoming digital enterprises,guided by composable principles.For the last 30 years,Valtech has helped brands including LOreal,P&G,and Dolby to become digital enterprises.With more than 6,000 employees across five con-tinents,it combines strategy,experi-ence design,data,software engineer-i
113、ng,and marketing to enable change at scale.And confectionary giant Mars is a great example of its recent work in the composable commerce space.Together with commercetools,Valtech has enabled Mars to embark on a journey which has resulted in the worlds most comprehensive example of composable commerc
114、e for mul-ti-brand enterprises going direct-to-consumer(D2C).All of Mars brands are now able to grow under one unified digital system,with the necessary flexibility for an omnichannel world.Mars can now provide better,more engaging and differentiated customer experiences across its brands and channe
115、ls,while still being able to adapt and innovate whenever needed.“With the right focus and investment,the future of composable is promis-ing.At Mars,it has helped us assemble niche capabilities to transform cus-tomer experiences.So,for a snacking business like M&MS,its now much easier to build and la
116、unch new expe-riences across multiple digital touch-points,without having to completely reinvent the tech wheel,”says Will Beery,vice-president and global CIO at Mars Wrigley.According to the MACH Alliance,many businesses are already spend-ing up to 50%of their budget on tech-nology upgrades.Composa
117、ble tech can ensure they avoid getting stuck in these cycles.Shubham Mehrish,vice-president for digital and plat-forms at Mars,says that as it attempts a company-wide digital transforma-tion,composable is perfect for deliv-ering“bite-sized capabilities that can be flexed or reconfigured depending on
118、 the needs of the wider business or individual brand”.He adds:“While we initiated it with a D2C mindset,this approach can be applied to any business model look-ing to get closer to the consumer faster.This model should also inspire other organisations to accelerate their own journeys to great experi
119、ences through composable.”Finally,Jeppesen believes that to survive in todays modern commerce environment,multi-brand busi-nesses must challenge the status quo.Composable methods enable“supe-rior customer experiences fit for the standards of today,while leaving room for the expectations and develop-
120、ments of tomorrow”,he argues.“Its a game of leapfrog or be leap-frogged,”he says.“Those organisations that dare to change,evolve and take calculated risks are the ones that stand to gain.”For more information please visit With the right focus and investment,the future of composable is promising.At M
121、ars,it has helped us assemble niche capabilities to transform customer experiencesMR A C O N T E U R.N E T0908B U S I N E S S T R A N S F O R M AT I O Nhe critics of AI have been warning that the emergence of generative tech such as ChatGPT,Bard and DallE 2 could usher in an era of declining human c
122、reativity.AIgenerated art and literature can hardly be described as inspiring,moving,thoughtprovoking or even very entertaining the hallmarks of great art.It is mostly bland,formulaic and,somewhat inevitably,robotic.But were still very much in the early days.One school of thought holds that,as the t
123、echnology evolves and better learns to understand the creative process,it will become able to produce increasingly sophisticated work.If AI eventually were to create images as aweinspiring as those of Michelangelo or poetry as moving as that of Wordsworth,where would that leave us?Would we have any
124、need(or motivation)toexpress ourselves creatively?AI can be thought of as a way to hasten work that the artist would be able to do unaided ifthey had enough timeNaysayers argue that the advance of artificial intelligence could lead to a decline in human creativity,but really the tech offers a wealth
125、 of options for enhancing our outputNow anyone who simply has a good idea can have AI flesh it out and bring it to life.Even if they dont want to put out something created by AI as their finished product,it can help with getting to the prototyping,firstdraft or pencil sketch stage,which may previous
126、ly have been impossible.Moreover,even when a computer does generate the finished output,its the human input that differentiates a simple picture,sound or piece of text from a work of art.Tools such as Stable Diffusion and DallE 2 can create technically proficient images a picture of a horse that is
127、recognisably a horse,say,and ChatGPT can write a story about a horse.But a human creator is still required to give it meaning and artistic value.Is the image supposed to simply show us what a horse looks like,or is it meant to convey equine beauty and power,as in the work of George Stubbs or Alfred
128、Munnings?Is a piece of writing simply meant to educate us on the qualities of a horse,or tell us an exciting adventure story such as Black Beauty?The human makes such decisions and,in doing so,defines the artistic creation.It therefore seems clear to me that AIs role is not to replace human creativi
129、ty but to aid it,by handling the mundane and/or technical elements of creativity,it can free the artist to focus on the elements that they excel at and love doing.Another factor is that,just like other tools,AI can be thought of as a way to hasten work that the artist would be able to do unaided if
130、they had enough time.This allows humans to explore a wider range of creative ideas and opportunities in a shorter period.Theres no reason to believe that Shakespeare would have been any less creative if hed had AI to help him,but he might have written hundreds of plays rather than a mere 39.AI can a
131、lso be used as a hammer to smash through creative blocks,a torch to ignite the creative spark or a shovel to unearth buried sources of inspiration.Of course,any exploration of the ways that AI will affect humanity must account for some ethical considerations.It might lead artists to unknowingly infr
132、inge copyright,as the sources of information that are included in its output are not always clear.There is also the question of attribution.At what point does the artist assign authorship to the AI?Is the initial spark enough to claim that the finished work is aproduct of the creators artistry?Or sh
133、ould a portion of the credit(and royalties)go to the creator of the AI or the source of the information on which it was trained?And how can we ensure that access to the democratising impact of AI is available to everyone and not the preserve of a privileged,techliterate social elite?That could lead
134、to further inequality and growing societal divisions.Answers to these problems are likely to emerge as AIs impact on the world becomes clear over the coming years.But,overall,my belief is that human creatives will find it an increasingly useful ally.Bernard Marrthe ability to think in a structured w
135、ay to plan and deliver a work of art,time management,attention todetail,quality control and even commercial acumen.After all,many artistic endeavours of the past 100 years may never have come to fruition if someone hadnt seen the potential to make money and stumped up the cash to make them happen.Th
136、ink how many great artists over the centuries might simply never have had their chance to shine because they lacked these everyday skills.Now that these can be automated or delegated to our robot friends,it could cease to be an obstacle for many.Additionally,AI can process huge amounts of data,drawi
137、ng together knowledge from thousands of sources and making it quick and easy to access.This means that human artists have more information from which to take inspiration,leading to new ideas that they simply may not have had without this collaborative partnership.The flipside of this is just as intr
138、iguing.Humans who lack the mechanical skills of creativity the ability to paint well or write the code for the video game that so far exists only in their head might also find themselves unfettered.Artificial artistry:the case for embracing AIIts a depressing thought,but it certainly isnt one I subs
139、cribe to.Rather,I believe that AI will amplify and augment our creative abilities in all sorts of amazing ways.Heres why.There is magic in human creativity.What I mean by that statement is that human creativity transcends the mundane.What is it that makes a great artist a writer,poet,painter,sculpto
140、r,musician or even a film director or video game designer?We cant know for sure,but the best answer is“everything that makes them human”.Its the interplay of talent,creative spark and drive(the burning need to express themselves creatively)of the artists values,beliefs and even political leanings an
141、d of many other qualities that machines cant yet emulate.But it also requires many more mundane qualities that are much easier to automate.These include O P I N I O NTCommercial featureHow leaders orchestrate harmonious transformationWhere disruption goes,transformation follows.But how do businesses
142、 set up conditions for success that make change less of a challenge?n an economy character-ised by high volatility,organ-isations are under immense pressure to transform at an ever-in-creasing pace.The speed at which businesses need to adapt to change is acutely accelerated where sustainabil-ity pro
143、jects,operational risk manage-ment and digitalisation are concerned.Most industries are cognisant that they need to hasten the upskilling and reskill-ing of their leaders to be better equipped to manage their business transforma-tion,ensuring their organisations remain competitive and successful.Seb
144、astien Planche,EMEA director at dss+,a global leader in providing operations management consulting services,points to“new leadership skills provision”and“time to auton-omy acceleration”the time needed to upskill and reskill leaders to become fully impactful to deliver results as the key areas where
145、businesses are piv-oting in response to economic instabil-ity and geopolitical machinations.Theres a problem,though:the prec-edent for responding to sustainability performance trends,global operational risks or emerging digital technologies on this scale hasnt been established yet.“Take sustainabili
146、ty,for example,”says Planche.“Most organisations have ini-tiated their journey to achieve net zero emissions,and some are more effec-tive than others.Nevertheless,its not something you can find the benchmark for and say,Lets replicate what they did.The benchmark hasnt been set.”Even with clear goals
147、,decision-mak-ers often feel ill-equipped to pilot those transformations,especially if they dont have the in-house skills to respond rapidly to uncertainty at pace.“This is especially noticeable within our recent projects on digital literacy and data-driven decision-making,”says Planche.“Companies a
148、re strug-gling to train leaders from the top to the frontline.They arent always com-fortable with digital technologies such as artificial intelligence,machine learning,and data analytics.”He adds:“These tools are now essential for most industries.A leaders ability to analyse data,inter-pret insights
149、,make informed deci-sions to drive sustainability transitions and manage their operational risks is also critical.”Businesses may be tempted to hire for these skills in the market.However,not underpinning this with a coher-ent learning and development strategy for upskilling middle management and ab
150、ove with the capabilities to manage transformations effectively means this is often just a short-term fix,even if they can find the talent with the right skills.“Too often,companies concen-trate on immediate challenges such as addressing difficult-to-fill positions,dealing with an ageing workforce,a
151、nd mitigating the loss of technical exper-tise,rather than focusing enough on accelerating the new leadership skill development,”Planche explains.However,traditional learning and development models might not be fit for purpose given the pace required to keep up.Planche cites the energy industry as a
152、n example.New engineers are typically expected to reach auton-omy in a leadership position within four years,40%faster than was required in 2020.For business-critical concerns such as health and safety,the time-frames are even shorter.“With serious injuries and fatali-ties,companies dont have the lu
153、xury of waiting several years to have lead-ers who can autonomously transform the culture and performance of their teams,”says Planche.“Our experience shows that a 24-week upskilling and reskilling programme enables you to stop the bleeding,reverse the trend of declining safety performance,and reach
154、 the necessary autonomy for sus-tainable results.”Planche says 75%of autono-mous managers are the critical mass required to impact cultural and busi-ness transformation.He emphasises the importance of these leaders possessing the nec-essary qualities and capabilities to initiate and lead successful
155、change initiatives effectively.This con-cept acknowledges that successful transformation relies on strong lead-ership and underscores the need for a substantial majority of leaders capa-ble of driving the desired changes.Creating change also relies on lead-ership from the top of the organ-isation.Pl
156、anche recalls a project that dss+worked on alongside a French train infrastructure opera-tor,addressing several high-potential safety incidents during their first year of operations.After assessing the companys safety culture,staff received support to bol-ster risk management capabilities and increa
157、se awareness and mitiga-tion skills.Senior leadership engaged in specialised coaching to increase buy-in across the organisation.This demonstration of a culture where all parts of the organisation are engaging in transformation is a crucial part of the process,says Planche.Successful operational tra
158、nsforma-tion at scale requires a strategy that effectively addresses all dimensions of a business.This can be particularly difficult in multinational organisations,with managers that often have differ-ent solutions and cultural expectations across their locations.To achieve this,dss+recommends busin
159、esses focus on specific areas of the organisation individually to stream-line and accelerate the transformation process.Each project is labelled as an area of transformation or an AoT.“AoT refers to the identification and focus on specific business segments that require change to achieve the broader
160、 transformation objectives,”Planche explains.“An AoT can be a par-ticular business process,a technology,a team,or even an entire department or production site.”Identifying the processes to trans-form urgently can be led by regula-tion;if a business is failing on health and safety provisions,thats th
161、e place to start.Beyond that,organisations should prioritise areas for transfor-mation that align with their immediate strategic goals and can deliver the most value for the company.From there,companies can formu-late a tailored strategy for each AoT,allowing them to manage the transfor-mation on a
162、more granular level and making it easier to monitor progress and adjust strategy as needed.Once successful transformation is achieved within that area,the next step is to scale it up to create a roadmap that can be adjusted and applied across the organisation.Scaling also involves evaluating the org
163、anisations readiness for change.Companies must assess whether they have the necessary resources,capabilities,and culture to support a broader transformation.For example,to benchmark a com-panys safety culture maturity level,dss+uses its proprietary Bradley Curve to understand the gap between where t
164、he company is now and to define further steps towards corpo-rate transformation.By these standards,companies that dont have the necessary commitment to keep their people safe record more incidents and suffer worse business performance as a result.“If you look at how organisations are driving busines
165、s transformation,they are moving away from silos to a more interdependent approach addressing key issues across sustainability,oper-ational risk management and digital,or risk the change fatigue if the prior-ities are not clear,”Planche concludes.“Managing operational risk allows you to integrate yo
166、ur transformations and to focus the efforts in the priority areas to effectively address talent shortages and make the biggest impact on the resilience of the business.”For more information,visit Companies dont have the luxury of waiting several years to have leaders who can autonomously transform t
167、he culture and performance of their teamsIR A C O N T E U R.N E T1110B U S I N E S S T R A N S F O R M AT I O NMany companies say that offering customers a smooth,convenient digital experience is a high priority.Despite this,only 39%of senior executives believe that their firms online CX capabilitie
168、s are meeting or exceeding users expectations.How can they improve their performance in this area?CATERING TO THE DIGITAL CUSTOMERHOW IMPORTANT ARE EMERGING TECHNOLOGIES TO DIGITAL CX?Share of senior executives giving the following responses when asked to rate the impact of selected tech trends on t
169、he customer experience provided by their firmsMOST CONSUMERS CONSIDER A GOOD DIGITAL EXPERIENCE TO BE IMPORTANT Importance of good digital CX according to consumersWHY FIRMS ARE PRIORITISING THE CUSTOMER EXPERIENCEShare of business decision-makers citing the following aims when asked why their firms
170、 had given a high priority to digital CXWHERE INVESTMENTS IN DIGITAL CX ARE BEING FOCUSEDShare of business decision-makers giving the following responses when asked to cite their firms priority areas for digital CX investmentSignificant impactLimited impactStill learningNot applicableUse of virtual/
171、augmented reality in the customer journeyCreating experiences in the metaverseMarketing in the metaverseUse of NFTs in marketing and customer experienceSEVERAL APPROACHES TO DIGITALISATION ARE APPLICABLEShare of senior executives giving the following descriptions of their firms approaches to CXDECIS
172、ION-MAKERS RECOGNISE THE NEED TO IMPROVE DIGITAL CXShare of senior executives giving the following evaluations of their firms digital CX capabilitiesWe use numerous technologies/vendors with no unifying platformWe use a cloud-based platform in concert with other management platformsWe use a platform
173、 that we developed internallyWe exclusively use a cloud-based management platformOur digital CX sometimes fails to meet our customers needsOur digital CX meets our customers needsOur digital CX is exceptional and can surprise and delight our customersDont know/not applicable14%10%23%19%36%39%27%32%3
174、6%32%22%10%20%19%9%52%40%35%19%3%3%Extremely importantSomewhat importantNeither important nor unimportantSomewhat unimportantNot at all importantGrow customer base and/or revenueImprove customer success/retention metricsStrengthen brand valueReduce costs of customer serviceIts part of a broader digi
175、tal transformation strategyStaying ahead of/keeping up with competitorsFix basic problems that really need fixingIts a top-down mandateIts not a priority for usOrganisational culture and/or structureCustomer journey analysis and optimisationAnalytics,insights and dashboardingDigital asset management
176、Digital experience platformsAI/machine learning capabilitiesSkills and trainingTargeting and/or personalisationMobile apps or mobile touchpointsInvestment in the internal digital environmentSocial listening and engagementCustomer service centres58%39%33%27%50%30%16%24%21%54%35%21%25%34%30%8%24%21%3%
177、23%20%Adobe,2023Adobe,2023Adobe,2023Verint,2022CMSWire,2023CMSWire,202350%12%16%22%42%7%19%32%R A C O N T E U R.N E T1312B U S I N E S S T R A N S F O R M AT I O Neter Bakker has encountered many raised eyebrows in boardrooms over the years and more than his fair share of derisive putdowns.Such is l
178、ife for the brave few who,like him,work to convince business leaders ofthe importance of sustainability.Fortunately,hes a resilient sort.And it helps that he has sat on the other side of the table,first as finance chief and then as CEO of logistics giant TNT.Over the decade that hes served as presid
179、ent and CEO of the World Business Council for Sustainable Development(WBCSD),Bakker has seen an improvement in the private sectors grasp of the strategic importance of environmental,social and corporate governance(ESG)issues.“Before,many business leaders were saying:I dont know why I need to listen
180、to this guy,”he says.“Now,you see them sitting up and thinking:Shit,I didnt realise that things were this urgent.”Whats behind this general improvement in attitude?And how can the council(a notforprofit body counting nearly 200 global companies as members)help them to start the transformation demand
181、ed by the ESG challenges facing their firms?First,key global events have helped the WBCSDs cause in recent years.Before the United Nations landmark Paris accord in 2015,the questions of whether the world was warming up and,if so,whether anthropogenic CO2 emissions were the main cause,were still bein
182、g debated.Since then,the climate scientists findings have been widely accepted.Moreover,the stark ramifications of global warming for business have become far clearer.Bakker cites the case of German chemicals company BASF,which was forced to pause production in the summer of 2018 after a drought low
183、ered water levels in the Rhine so drastically that supply barges were prevented from reaching its riverside manufacturing facilities.The temporary stoppage cost the firm anestimated 250m(214m).“You cant pick up a newspaper these days and avoid reading about climate change or weather impacts,”he says
184、.“These topics are very much on the minds of everyone now including boards.”Bakker is not shy of playing the environmental doomsday card when faced with scepticism.Fail to slow global biodiversity loss,he warns,and the world will soon face“massive systemic risks”including famine owing to crop failur
185、es,military conflict owing to water scarcity and mass migration owing to desertification.He adds that social inequality represents a key threat to big business in particular:if the gap between rich and poor is left to widen even further,we can expect societal cohesion to weaken and conflict to flare
186、 up.“Large multinationals will be the first to get bricks through their windows,because theyll be seen as the face of whats no longer a fair system,”Bakker says.While some boards may rationalise such scenarios away,with some arguing that technological advances will solve most problems,the threat pos
187、ed by market disruptors is harder to dismiss,according to Bakker.He recalls attending a board meeting for a large automotive company five years ago.For every mention of Mercedes in the discussion,there were eight references to Tesla “and that was back when the electric car firm was a relative minnow
188、”.The flipside of disruption,of course,is opportunity.Smart boards are generally quick to see the commercial potential of being first to the market with greener,fairer products and services,Bakker notes.“If youre the first to get it right,youll have the kind of growth opportunity that you simply nev
189、er would have had within your incumbent model,”he says.On the few occasions that his audiences remain unconvinced these days,Bakker takes a more direct route.Like it or not,he tells them,ESG issues arent going away and neither is regulatory scrutiny.The need to comply with reporting requirements oft
190、en proves the clincher to his argument.Six years ago,the G20backed Financial Stability Board published a report stating that large companies might need to disclose their climaterelated risks.Today,that might is fast becoming a will.The common first response of many boards is to ask how much taking t
191、he appropriate action will cost their companies.Bakker will reply that it will be“much less than the cost of inaction”.Once an audience has accepted his arguments,Bakker will deftly change his persona from preacher to adviser.His first move then is to warn against dealing with ESG issues in a piecem
192、eal way.To this end,he advises boards to make an integrated assessment of all their ESG risks as an initial step.As he points out:“Once you have a handle on these,you can start trying to design solutions.If you address one in isolation,youll find that you have many other interdependent risks still a
193、round.Only a holistic view makes sense.”There is no single transformation blueprint that will work for every organisation.Each company has a unique combination of risks and opportunities to address.That said,some basic tenets of futureproofing apply to all enterprises.The WBCSD set these out in its
194、2021 report Vision 2050:time to transform.A crucial first step is forming a clear idea of what a truly sustainable version of your business and/or industry might look like in the longer term.The next is planning how to achieve that.Here,the council suggests“transformation pathways”for 10 key sectors
195、,from energy and transport to healthcare and financial services.In each case,boards are encouraged to look beyond their own four walls and ask themselves two core questions.The first is:what factors are preventing the system in which they operate from being more sustainable?The second is:what levers
196、 can their businesses pull to help transform that system?Take the construction industry,for instance.All too often,the built environment reduces biodiversity,emits a lot of greenhouse gas and harms peoples health.The solutions include planning with regeneration in mind,prioritising peoples health an
197、d wellbeing needs at the design stage and making full use of recycled materials and energyefficient tech.Bakker cites Nestl as an effective exponent of visualisation and planning.The Swiss food giant recently published a detailed account of how it will reshape its operations and product portfolio to
198、 prepare for the realities of a lowcarbon economy.“Nestles climate transition plan not only details precisely how the company is going to decarbonise;it also spells out how people can hold the firm accountable,”he says.Board members themselves should adopt a new way of thinking,Bakker adds.He sugges
199、ts that they start working to the“three Rs”:reinvention(get ready to ditch business as usual for a more sustainable,inclusive alternative);regeneration(actively consider how to help the planet and its inhabitants to thrive);and resilience(train yourself to better anticipate and embrace change).He wo
200、uld also urge senior leadership teams to spread the word and encourage other stakeholders in their businesses to join the ESG effort.Sustainability is too broad and business transformation is too complex to leave to the few to deal with,however able and willing they may be.That may well mean retrain
201、ing employees,reorientating supplier relations and rethinking communications with consumers.Business leaders must clearly“embody the desire to transform”,Bakker argues.“But all functions in the organisation need to be educated on what this transformation means for them.This cannot simply be left to
202、the sustainability team.”Or to the board,for that matter.Oliver BalchLarge multinationals will be thefirst to get bricks through their windows,because they willbe seen as the face of whatsno longer a fair systemPThe World Business Council for Sustainable Development is working to hasten the systemic
203、 changes required for a carbon-neutral future.Itspresident,Peter Bakker,explains how he wins sceptical boards overOnly a holistic view makes senseI N T E R V I E WInternational Federation of Accountants,202267%of S&P 100 companies spread ESG oversight over two or more committees54%of FTSE 100 compan
204、ies have some kind of ESG committee at board levelIf youre the first to get it right,youll have the kind of growth opportunity that you simply never would have had within your incumbent modelCommercial featureveryone needs to play their part in reducing carbon emissions if the world is to have any c
205、hance of meeting IPCC tar-gets.That said,it is businesses,not individuals,that have the most control over the planets sustainability efforts.Just 100 companies have been respon-sible for around 70%of all global emis-sions since 1988,and regulatory pres-sures to adopt greener processes are only likel
206、y to increase.One way of improving a corporate carbon footprint is through digital transformation.As Johan Hanekom,principal for sustainability and inno-vation at Amazon Web Services(AWS),says:“Moving to the cloud can help companies curb their environmental impact by reducing energy consump-tion,pro
207、moting renewable energy,reducing travel by enabling remote work and promoting paperless operations.”By and large,those changes are great for the green economy:they mean fewer trees being cut down,fewer cars on the road and more efficient work practices.However,going green isnt black and white,and bu
208、sinesses have to modernise in a responsible way.A digital transformation isnt enough.Businesses need to aspire for a sus-tainable digital transformation.Part of a successful sustainable digi-tal transformation lies in taking respon-sibility for current and future emis-sions.This is something that re
209、quires a joint effort between organisations and suppliers.For example,Amazon Web Services(AWS)takes responsibility for the sustainability of its infrastructure,How to ensure cloud and net zero ambitions alignIf approached correctly,cloud operations can support organisations towards their sustainabil
210、ity goalswhile also providing organisations with tools to help them take responsibility for their own sustainability efforts.AWS offers a carbon footprint tracker which helps customers evaluate emis-sion trends as their use of the cloud evolves.Businesses can use this to test the impact of their dig
211、ital assets,such as assessing unruly data sets and needlessly large files.Armed with this knowledge,they can take positive steps to optimise resources within the cloud and only use the computing capac-ity they really need.The tracker also estimates the carbon emissions busi-nesses have avoided by us
212、ing cloud services rather than an on-premise data centre.And how are the cloud provid-ers ensuring they meet their end of the bargain?AWS“has taken steps to reduce its environmental impact.It has already reached 85%renewable energy across its businesses,and is implementing energy-efficient tech-nolo
213、gies and reducing waste,”says Hanekom.Multiple studies by 451 Research show that AWSs infrastructure is 3.6 times more energy efficient than the median of US enterprise data centres surveyed and up to five times more energy efficient than the average in Europe.Research by the same com-pany also foun
214、d that AWS can lower customers workload carbon foot-prints by nearly 80%compared to sur-veyed enterprise data centres.“AWS has also committed to achiev-ing 100%renewable energy usage for its global infrastructure by 2025 five years ahead of its original com-mitment and being water positive by 2030,”
215、says Hanekom.Some of those sustainable steps include novel data centre designs,new cooling tech-niques and advanced modelling meth-ods.With access to cutting-edge tech-nology,including custom-built servers and innovative chip design,large pro-viders such as AWS can help organisa-tions of all sizes b
216、ecome far more effi-cient than they could on their own.Many aspects of cloud technology are set to become even more sustainable in the coming years.Progress will come in the form of greater energy efficiency in data centres,resource optimisa-tion within the cloud and the advent of green computing an
217、d green coding initiatives to implement more efficient computing processes.But underlying and motivating all these technical choices,there also has to be a deeper,more substantial shift in mindset.Service providers must“design around first principles for the circular economy for all the compo-nents
218、used in cloud technology,”says Hanekom.That way a sustainable digital transformation can become the norm,not just a nice-to-have.To find out more,visit A C O N T E U R.N E T1514B U S I N E S S T R A N S F O R M AT I O NCommercial featuren its 2022 report on the issue of the value-added tax(VAT)gap,t
219、he European Commission found that EU member states were short an estimated 93bn in VAT revenues in 2020.A shade under the joint GDP of Latvia and Lithuania,the sum is as staggering as it is concerning.With this figure overhead,govern-ments across the continent have been quick to address the tax gap,
220、recognis-ing the tangible difference reducing it could make to the 451 million people living in the EU.One way of doing this is by introduc-ing standardised e-invoicing,says Alex Baulf,senior director of e-invoicing at Avalara.“Tightening up on e-invoic-ing ensures that tax authorities can see every
221、 transaction,”he explains.“Over 60 nations have now mandated e-invoicing.France,Poland and Spain are the latest countries in the EU to announce their plans to bring in man-datory B2B e-invoicing regulations next year.”Latin American countries such as Brazil and Argentina started this revolution a de
222、cade ago by The e-invoicing revolution is comingGovernments are getting serious about closing the VAT gap.Should businesses be prepared for a revolution in e-invoicing?introducing tax data collection at the point of billing,according to research published by Avalara.“The pace and quantity of new man
223、-dates are unprecedented and are causing a huge headache for multina-tional businesses,”says Baulf.“Tax and finance functions now need to look at e-invoicing and live reporting of trans-actional data strategically.This is no longer a local compliance issue its a critical global business issue.”Digit
224、ising invoices brings greater vis-ibility,transparency,accountability and governance to tax collection.But thats just half of it.“The problem is that while tax authorities all over the world might see the inherent value in e-invoicing and tax digitalisation,com-pliance is never uniform,”says Baulf.H
225、e continues:“Different tax author-ities have different requirements,for-mats,models and platforms,which companies must be able to navigate seamlessly and accurately,or risk fall-ing foul of individual tax authorities.”But e-invoicing the sending of digi-tal documents with structured data,is not just
226、 about tax compliance.Indeed,it becomes a business-critical issue;how businesses exchange invoices between their trading partners.If a business is unable to issue or receive an e-invoice meeting the local require-ments,it is unable to get paid and ulti-mately do business in that country.Baulf argues
227、 that organisations now need to take a strategic look at e-in-voicing to meet international standards,investing in a single global e-invoicing solution that can standardise processes at scale.One such solution is Avalaras cloud-based global invoice and tax compliance platform,which helps com-panies
228、comply with e-invoicing regula-tions in more than 60 countries.“We designed our scalable e-invoic-ing solution with a single application programming interface(API)to con-nect businesses to a multitude of dif-ferent e-invoicing systems,platforms and networks.This seamless accessi-bility enables them
229、to meet local regu-latory standards and the requirements of tax authorities,including those that require digital signatures and QR codes quickly,effectively and efficiently.”If migrating to e-invoicing checks so many boxes,it begs the question:should companies with global reach be digitising their p
230、rocurement processes regardless of regulation?“Absolutely,”says Baulf.“From a regu-latory perspective,it makes sense.But theres also a business case for imple-menting an industry-leading e-invoic-ing platform.It streamlines processes,cuts costs and provides businesses with more granular data,giving
231、pro-curement departments greater visibility over spending.”He explains:“Reducing the tax gap is one thing,but businesses should be harnessing the wider benefits that digitalisation and increased auto-mation bring.”This increasingly common realisation,shared by many forward-thinking busi-nesses,tax a
232、uthorities and countries,is quickly leading to a sweeping shift in the way invoices are processed and VAT is reported.“E-invoicing is now the clear direction of travel for tax authorities.If a country does not have e-invoicing today,it will tomorrow,”Baulf concludes.So,while regulators establish a m
233、eans for uni-versal adoption,organisations should be primed for change.For more information please visit the tax gap is one thing,but businesses should be harnessing the wider benefits that digitalisation and increased automation bringIaving had to issue a string of profit warnings between 2012 and
234、2020,education company Pearson has been busily reinventing itself in recent years,with some success.The purveyor of university textbooks has converted itself into a digitalfirst business.In a trading update in March 2021,less than half a year into the turnaround,CEO Andy Bird noted:“We no longer buy
235、 CDs;we listen to Spotify.We no longer buy DVDs;we watch Netflix.How we learn is also changing,driven by technology and new consumer habits.”Under the leadership of the former Disney executive,who joined in October 2020,Pearson has started to see digital sales growth and The costofdoingbusiness cris
236、is is likely to have made firms even more wary of committing to bigticket,longterm investments of any kind.It would be understandable for a struggling company to put transformation plans on the back burner while it focuses on cost control perhaps even by cutting its IT budget to ensure its shortterm
237、 survival.Paul Edwards is chief of technology evolution at transformation consultancy AND Digital.He argues that,while it“can be hard to predict the commercial benefits”of a transformation,“business leaders need to move away from a costcentred mentality and start looking at it as a value stream enab
238、ler.”Edwards believes that prioritising a transformation is likely to pay off in the medium to long term.He points to the potential gains to be made when a business is optimised to receive feedback faster,learn faster and see results faster.“This step change allows businesses to tap new revenue stre
239、ams that they may not have been aware of previously.It opens doors and creates possibilities,”Edwards says.Clare Hickie,EMEA technology chief at softwareasaservice firm Workday,agrees.Her view is that any shortterm pain experienced ina transformation project should be outweighed by lasting gains ach
240、ieved through improvements in resilience,agility and decisionmaking.“The capacity for scenario planning and whatif analysis,for instance,can offer business leaders a strategic playbook for handling future disruption,”Hickie suggests.“This will then equip them with a dataled plan amid the uncertainty
241、.”Edwards stresses that firms must first understand that a digital transformation is not simply about adopting new technology if they are to stand any chance of maximising the return on investment over the medium to long term.“This act will be meaningless if the business hasnt set itself up in away
242、that makes the best use of that technology,”he says.Take the uptake of generative AI,for example.While it may be a powerful technology,it will prove far less effective in the hands of an organisation that has yet to jettison oldfashioned structures and attitudes,such as the silo mentality.Edwards co
243、mpares that situation to“sitting in a traffic jam in a Ferrari,thinking that your vehicle of choice will get you to your destination faster”.In a hierarchical structure,each employee has a clearly defined role,but there can often be a lack ofcommunication through all the levels.As a business grows,t
244、he hierarchy can deepen,exacerbating the communication problem.A particularly vertical structure makes it hard for leaders to rally support among the rank and file for a transformation.Successful project management also requires fast decisions to be made.All this demands a flatter structure,which ca
245、n open lines of communication and ensure that all staff are aware of all the goals of the exercise.The right structure should foster a culture and ways of working that encourage learning and innovation.This should in turn ensure that the business extracts the maximum possible bang for its technologi
246、cal buck,Edwards argues.“Only when a business is structured in a way that empowers teams with the right people,skills and tools will you see profound changes that drive true value,”he says.Part of setting the right structure in place entails establishing a selfperpetuating positive feedback loop.Thi
247、s will inform the transformation constantly and push it in the direction it needs to go.The FTI Consulting survey found that those leaders whod reported successful digital transformations were more than twice as likely as those who hadnt to cite the use of feedback as a success factor.Whats more,whi
248、le the cost of adopting systems such as machine learning may seem excessive to struggling firms,such automation promises to deliver efficiency savings by streamlining functions.Moreover,the insights that could be gleaned from this tech could cut the cost of implementing digital solutions further dow
249、n the line.For any business thinking about deferring its digital transformation because of the high upfront costs and the relatively long payback period,Hickie offers these words of warning:“The world is evolving rapidly and the cost of not transforming can be far greater,potentially leading to miss
250、ed opportunities and decreased competitiveness.”Rich McEachranOnly when a business is structured in a way that empowers teams with the rightpeople,skills and tools will you see profound changesMcKinsey,2019in the full knowledge that patience will be required.Anyone who imagines that a transformation
251、 will be an overnight success is likely to be in for a big disappointment.The degree to which CEOs are willing to start digital transformations and persevere with them can be influenced by the large amount of capital expenditure these typically require and the knowledge that theyll have to wait to s
252、ee a financial return on that investment.When FTI Consulting surveyed 600 business leaders in the UK,France and Germany at the beginning of 2023,it found that only a quarter of the 31%who had reported completing a transformation deemed it a complete success.But they were expecting their businesses t
253、o grow organically by an average of 27%over the year,compared with the 18%mean growth rate forecast by those who had yet to complete atransformation.Some leaders may be finding the upfront costs and complexities of implementing a digital strategy too daunting to contemplate,given that there are no g
254、uarantees that a transformation successful or otherwise will deliver growth quickly.Thats the view of Jon Priestley,MD of FTI Consultings strategic communications business.“A digital transformation can feel incredibly complex,”he says.“Do you start with the tech required,the finance you need or the
255、people to execute it?Business leaders are under pressure on several fronts,so it can be all too easy to focus on more immediate challenges and put a transformation to one side.”Struggling businesses might understandably be wary of committing precious cash to a transformation.But its likely that the
256、benefits will outweigh the initial expense,uncertainty and disruption eventuallyThe point of slow returnsI N V E S T M E N Timproved margins.A key factor in the FTSE 100 companys recovery has been its ability to persuade key stakeholders to back its rejuvenation plan.It was telling that the same tra
257、ding update featured a contribution from Amazon CEO Andy Jassy,who at the time was in charge of AWS,Pearsons cloud partner.“There are a lot of companies who talk about transformation,but not all of them succeed.Fortunately for us,Pearson really gets it,”he said,adding that the company had“made a ton
258、 of progress”.Pearson serves as an exemplar of what can be achieved when theres a shared vision and full commitment to the process of realising it HStigur Mar Karlsson/Heimsmyndir via GettyWHAT TO EXPECT FROM A DIGITAL TRANSFORMATION IN THE FIRST YEARAverage share of transformation value achieved by
259、 top-quartile companies over the first year of a transformation28%57%66%74%The first three monthsSix monthsNine monthsOne yearR A C O N T E U R.N E T1716B U S I N E S S T R A N S F O R M AT I O Nhe startling advance of generative AI,embodied by tools such as ChatGPT and Midjourney,has created tremor
260、s that are being felt well beyond the hitech sector.The technologys farreaching implications are forcing firms across the board to consider how they and their sectors will be affected,for better or for worse.Big business certainly isnt immune to the impact of this transformational tech.Indeed,senior
261、 executives from numerous bluechip companies have discussed theeffects of AI in recent weeks,in forums ranging from earnings calls to industry conferences.Heres a look at how a small but diverse selection of FTSE 100 constituents are approaching the leap forward in generative AI,based on recent publ
262、ic comments by their senior executives.1 BT Group Speculation about the impact of AI on jobs became more concrete in May when BT announced plans to eliminate 40,000 to 55,000 roles by 2030 in its automation drive.The giant telcos workforce could shrink by more than 40%as a result.Most of the downsiz
263、ing will happen as the construction of BTs fullfibre broadband and 5G infrastructure tapers off and the company stops running double networks such as 3G and 4G,requiring less labourintensive maintenance.But other job cuts will result from the digitisation of operations and the automation of customer
264、service processes.This will push consumers towards web and appbased tools rather than call centres.BT already uses a support chatbot.CEO Philip Jansen highlighted the importance of AI to the groups automation plans during its fullyear earnings call on 18 May.He said:“We will be a beneficiary of AI,u
265、nequivocally,because were a volume business with some 30 million customers.We have lots of people and One analyst on the call suggested that the increased use of AI in creative campaigns,while making these more profitable through efficiency savings,might also reduce the fees that WPP could justify c
266、harging its clients for the content produced.Read rejected this notion,saying:“I dont think AI is going to make people suddenly more creative or shorten that process.”3 PearsonThe digital learning specialist has revealed its focus on AI perhaps more than any other FTSE 100 member lately.Given the po
267、tential threat to its business model posed by popular free tools such as ChatGPT,thats hardly surprising.On 1 May,US rival Chegg reported a 5%decline in subscribers and suspended its fullyear guidance,citing the impact of ChatGPT.The next day,Pearsons stock price fell by 15%,even though the company
268、had reported a quarterly revenue gain of 6%only a week earlier,surpassing its own expectations.Stressing that 80%of its profits come from outside the higher education sector,Pearson was quick to distance itself from Cheggs situation.To further reassure shareholders,it announced a generative AI strat
269、egy update on 9 May,revealing plans for harnessing the technology to enhance its services.Those plans include the addition of AIgenerated tests and quizzes to its Pearson+subscription service and the use of LLMs to construct predictive algorithms providing career recommendations.During the conferenc
270、e call,CEO Andy Bird said that generative AI was“a significant positive opportunity for Pearson”rather than a threat.But he added that the company had been taking legal action to prevent its intellectual property from being used by third parties to train AI models.“We take great efforts and will con
271、tinue to take great efforts to protect our IP,”he said.“I think what has really changed over the past six months is the application of AI into the creative process of the production of language,video imagery and so on,”he said.“Thats really allowed us the opportunity to use it much more creatively.”
272、That includes a recent campaign by its Wunderman Thompson agency on behalf of the Iran Democracy Council,a group of female lawyers and activists of Iranian descent.This used OpenAIs foundational model GPT4 to create a digital book imagining a brighter future foroppressed women in Iran.Over recent we
273、eks,FTSE 100 firms have shared revealing insights about what breakthroughs in generative AI mean for their businesses.Heres what some have had to sayFive go on an adventure in generative AIMark Walshlots of activity.AI can help us to do that more efficiently.”Jansen also hinted that further advances
274、 in generative AI and large language models(LLMs)would prompt more innovation.“Weve got a few ideas,but it is very early days,”he said,adding that their development needed to be“treated with great care”.2 WPPThe multinational advertising and PR group made its intentions clear back in August 2021 whe
275、n it acquired Londonbased AI specialist Satalia,naming the firms CEO,Daniel Hulme,as its first chief AI officer.That move looks especially prescient given the surge of interest in generative AI in recent months.During WPPs firstquarter earnings call in April,CEO Mark Read noted that the company had
276、been using AI for years,mainly in its media segment for targeting audiences and optimising campaigns.What has really changed overthe past six months is the application of AI into thecreative processNext Move Strategy Consulting,2023THE BUSINESS OF ARTIFICIAL INTELLIGENCE IS BOOMINGActual and forecas
277、t value of the global AI market from 2021 to 2030($bn)A R T I F I C I A L I N T E L L I G E N C ETAnnasmithphoto via GettyImages4 Unilever Since the Covid crisis,Unilever has been no stranger to snarlups in the supply chain.When necessary,the consumer goods giant has been using AI to help it source
278、alternative ingredients without affecting the end product.But thats only one of about 300 uses of AI across the business,whose brands include Ben&Jerrys,Hellmanns and Vaseline.Alessandro Ventura,Unilevers CIO and vicepresident of analytics and business services in North America,spoke about an AI too
279、l called Alex in a recent interview with CIO.com.This system manages incoming emails,efficiently filtering out spam and phishing bait from genuine consumer correspondence.It will then suggest responses for employees to send.Ventura revealed that another AI application,Homer,uses the GPT API and can
280、generate online product listings that capture the right tone for each brand.Last year,the company even used AI to develop a limitededition deodorant,the Lynx AI Body Spray.The tech helped it to analyse 6,000 ingredients and 3.5 million scent combinations.While that particular product might seem like
281、 a marketing gimmick,Unilevers aptitude for discovering useful AI applications appears to be paying off.The company reported a 10.5%yearonyear gain in under lying sales in Q1 2023.5 Compass Group Even companies that dont appear at first sight to be directly affected by AI have got it on their radars
282、 and for good reason.Take Compass Group,the worlds largest food service provider.It earns a large proportion of its revenue from managing corporate cafeterias through its business and industry(B&I)division.According to a Morningstar analyst report in May,the Covid lockdowns and the rise of remote wo
283、rking have actually strengthened Compass Groups position in its market because some smaller rivals have been forced out of business.But,if the adoption of generative AI by its clients reaches such an extent that it slashes the number of people who need feeding on their premises,that would be a real
284、blow to the firm.When asked about the longterm indirect impact of generative AI on the B&I division during the companys most recent earnings call,CEO Dominic Blakemore indicated that the business was diversified enough to mitigate the risk.He added that Compass Group was still working out how best t
285、o approach AI.“Were in considerations and conversations with a number of partners to understand how it can improve our processes,”Blakemore said.“It may create opportunities for roles within the tech sector.It may diminish roles in others.”202222025202920232027202620302004006008001,0001,2
286、001,4001,6001,800Commercial featureusiness continuity and disas-ter recovery have long been an important focus across a whole range of industries.However,amid evolving customer expectations and shifting economic conditions,severe and complex threats continue to emerge rapidly,requiring a more proact
287、ive,agile and effective approach to crisis response.Financial services regulators are driv-ing change too,with their increased stringency intended to avert systemic disruption.Institutions must therefore meet enhanced demands in relation to ensuring key service stability,monitor-ing interdependencie
288、s(including in the supply chain),improving reporting and response capabilities,and proactively remediating vulnerabilities.Increasingly,other industries are vol-untarily addressing the same issues,drawing data in from across their organisations and fully mapping the end-to-end customer journey as a
289、form of best practice.“The impact of financial regula-tions is being seen across the board,with organisations prioritising resil-ience-driven investments as a matter of competitive advantage,”notes Kate Needham-Bennett,Fusion Risk Managements senior director for resil-ience innovation.“Organisations
290、 are beginning to understand the impact of intolerable harm to their customers and the broader markets when their services are disrupted.”Across all industries,organisations must mitigate risks,ranging from energy outages to cyberattacks,supplier dis-ruption,geopolitical fallouts and inac-curate dat
291、a all of which can have severe consequences.For instance,in financial markets,simple errors can leave customers facing irreparable losses,while interruptions to organisa-tions providing critical infrastructure can have extreme societal effects.So,faced with multiplying risks but limited resources,or
292、ganisations will need to sharpen their approach to resilience.“They need to first focus on a distillation of their most impor-tant services and the scenarios that could cause the worst impacts,”explains Steve Richardson,Fusion Risk Managements chief resilience inno-vation officer.“The response must
293、be built right into the design of their operations and models,with clear allocation of who will be responsible for resilience and who will govern the associated processes.”For heavily regulated organisations with mature resilience programmes,Why operational resilience starts with better dataAs servi
294、ce disruptions start producing long-term damage,the stakes around operational resilience are rising.Firms should take several critical steps to protect their operational capabilitiesorchestrating the totality of simultane-ous changes and reducing duplicated effort is essential.“They need to reg-ular
295、ly have all the right people at the executive table and ensure that oper-ational resilience is discussed holisti-cally alongside financial resilience.By doing so,they can more consistently make the right,unified decisions,”Richardson explains.At the heart of all resilience deci-sions should be excel
296、lent data collec-tion and rapid insight actionability.“Organisations should evaluate if they are asking the right questions and if the data that is being collected answers these questions,”explains Needham-Bennett.“It is critical that they con-tinually pull in real-time,relevant data while empowerin
297、g their staff to proac-tively investigate and remediate mat-ters quickly.”Given the need to accomplish this quickly,organisations must adopt a tough stance internally,acting as their own auditor.This means asking ques-tions such as when their resilience systems were last tested,how long services wou
298、ld really take to recover,and what the knock-on impacts might be of severe disruption,Needham-Bennett notes.To meet these challenges,global organisations are turning to special-ist firms like Fusion Risk Management,which can provide them with sustain-able,connected,real-time insights from across the
299、ir operations.This is crucial in gaining a holistic overview of the business,its functions,its fric-tion points and its vulnerabilities.The resulting insights allow organisations to have clarity over current and potential risks,while also guiding any immediate responses,as well as longer-term steps
300、that deepen their resilience.Financial services firms managing their resilience in this way are moving away from siloed business conti-nuity documents towards a holis-tic,real-time,data-driven approach with specified resilience workflows.Meanwhile,retailers and manufac-turing distributors with geogr
301、aphi-cally dispersed operations have been among those implementing Fusion Risk Managements platform,to provide centralised risk assessments and to shape rapid targeted responses.As organisations increasingly recog-nise the intolerable harms that could be caused by disruptions to their critical servi
302、ces,integrated opera-tional resilience technology will be ever more essential to their ability to understand and mitigate impacts,preserving their agility and bolstering sustainable growth.To find out about operational resilience in practice,visit BResilience must be built right into the design of o
303、rganisations operations and models,with clear allocation of responsibilitiesR A C O N T E U R.N E T1918B U S I N E S S T R A N S F O R M AT I O N60 years of leading transformati on in risk management and insurance Airmic Ltd,Marlow House,1a Lloyds Avenue,London EC3N 3AA?Take a free membership test d
304、riveand see what we have to off er.ransformations are risky at the best of times,but they have become a whole lot harder since the Covid crisis.Firms overhauling tired legacy systems still have to splash out on the latest technology;manage the costly and complex process of implementing it;ensure tha
305、t business continuity is maintained;and get the whole org anisation to embrace the new way of doing things.Now have to do this against a particularly unstable and unpredictable economic backdrop,where weak demand and rising operating costs are squeezing profits.Managing all the associated risks can
306、feel like“building a plane while its in flight”,according to Sabrina Feng,group head of technology,cyber and resilience risk at the London Stock Exchange Group.But she adds that,while the associated risks may appear daunting tosome organisations,they need to consider the risks of either not transfor
307、ming or approaching the task in a disorderly way.“Without a structured and considered programme,change can be haphazard,with the potential to No transformation is without its pitfalls,butits crucial to remember that these are far outweighed by the dangers of inertiaRisk-aware,not risk-aversecreate m
308、ore issues for the organisation,”Feng says.Some business leaders face a challenge in convincing the risk management function in their organisations that the benefits of transformation will surely outweigh the risks.But in tough times,how can that be done,and how can companies give themselves the bes
309、t chance of making the project asuccess?Connie Chan,a senior managing director in the business transformation practice at FTI Consulting,says that firms undertaking a transformation project need a“completely different way of managing risk”.They also need to review how they plan,budget and operate,es
310、pecially if they are global businesses with highly complex supply chains.Chan believes that firms should adopt a“crisis,semirestructuring mindset”.Her advice is to take a rigorous,data driven approach to transformation;establish tighter business controls;refocus sales and marketing activities;optimi
311、se cost categories;and manage the supply chain aggressively.“Managing a transformation effort in these times is challenging,as the business needs a comprehensive approach and an ability to coursecorrect swiftly as and when circumstances change,”she says.“Businesses need a more handson and proactive
312、approach,with frequent monitoring of financial and operational performance.”The first big challenge of any business transformation is to secure support for the plan from across the business,which can be more difficult when economic conditions are tough.Jon Lucas is a cofounder and director at Hyve M
313、anaged Hosting,which helps organisations to migrate legacy tech into the cloud and build and deploy new systems.He thinks it is crucial to ensure that everyone in the business understands all the desired benefits of the transformation.If that doesnt happen,there is a greater likelihood that corners
314、will be cut and core operations harmed as a result of budget constraints and inadequate infrastructure.Various departments also need to be on the same page to ensure that the transformation doesnt become siloed,which often leads to system integration failures.“Its important to showcase and communica
315、te the transformations value to the entire business,”Lucas says.“For example,benefits such asthe centralisation of processes,the sharing of resources and the utilisation of data analytics can allshow how it can provide a competitive edge.”Senior leaders have a vital role in selling the concept to th
316、e wider company and should lead from the front.So says Philip SonghurstThonet,senior director of risk management consultancy Control Risks.Transformation is founded on cultural change,he stresses,and convincing people to break old habits and develop new ways of working is key.“Setting the tone from
317、the top and linking objectives to clear outcomes will support the case for change.”Companies also need to invest in appropriate governance and processes before the start of any transformation,SonghurstThonet advises.Such projects are usually complex,fastpaced and uncertain,meaning that any midstream
318、 change of scope can cause time and cost overruns.As such,its vital to devote time beforehand to understanding cost estimates,their assumptions and uncertainties.A transformation will nearly always disrupt businessasusual tasks,leading to a reduction in overall organisational performance.For instanc
319、e,if a large retailer starts a project to modernise payment handling,it could lead to a temporary loss of revenue and severe reputational damage if it encounters serious glitches during the move to a new platform.Similarly,banks could find that customers cannot access their finances if there is unpl
320、anned disruption during the implementation of a core banking platform.Control Risks advises its clients to take a“stagegated”approach,so that the risks and rewards of the transformation are continually assessed and challenged throughout the project.SonghurstThonet also thinks that,while leaders shou
321、ld be“communicating broadly”and keeping the wider company up to date on the project,formal engagement should be limited to a smaller group,allowing the organisation to focus on core business.Dynatrace is one of a crop of companies helping organisations to mitigate the risks of digital transformation
322、 by harnessing artificial intelligence and automation tech.Greg Adams,regional VP of its business in the UK and Ireland,advises companies to put an“observability strategy”at the front and centre of their planning.“This enables the teams delivering a business transformation to monitor and manage the
323、customer experience before,during and after the transition to new systems and processes,”he explains.WalkMe helps businesses to see how well their new tech is being used and ensure that employees are getting the most value from it.This can overcome any obstacles to adoption,says its digital transfor
324、mation officer,Vivek Behl.The firm also helps clients to target their technology investments and ensure that staff have a consistent experience across all applications.While there are many tools and strategies to aid a smoother transformation,no project will ever be riskfree.That said,Feng believes
325、that firms can greatly mitigate against unforeseen threats if they ensure that people are“riskaware”and are using all the right data to inform their decisions.“Every transformation is different.If done right,they will drive efficiency,make the firm more profitable and enable better risk management,”
326、she says.“The role of the risk function is to enable riskaware decisions and enable safe growth.This is not about avoiding all risks.”Setting the tone from the topand linking objectives to clear outcomes will support thecase for changeDaniel ThomasR I S K M A N A G E M E N THarvard Business Review,2
327、022MITIGATING OPERATIONAL DISRUPTION IS THE TOP PRIORITYShare of managers and executives citing the following KPIs when asked how their companies measure the effectiveness of business transformations T52%37%21%38%29%17%46%29%20%38%22%16%batuhan toker via iStock Operational efficiencyGrowth/revenue g
328、enerationProfitabilityCustomer retention/loyaltyEmployee satisfactionMarket position versus competitorsCultural changeNew product/service introductionSpeed to marketCustomer lifetime valueOperating expenses versus capital expensesIT maintenance versus new product expenditure20B U S I N E S S T R A N
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