Business leaders in global poll say competition, technology, AI, and regulation are more critical challenges than COVID-19 and less than half of executives are highly confident in their ability to withstand disruptive forces
Despite the universal impact of COVID-19, global business leaders cited numerous disruptions to their business that are deemed more impactful than the pandemic. That’s according to a report released today by AlixPartners, the global consulting firm. The 2021 AlixPartners Disruption Index surveyed global CEOs and executive leaders to examine attitudes toward the forces that reshape business. Business leaders say that new and evolving competition, technology-impacted processes, and regulation are more disruptive to their companies than COVID-19.
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Simon Freakley, CEO, AlixPartners (Photo: Business Wire)
The report shows that executives are planning for new waves of disruption in a post-pandemic world. From internal workplace policies to big picture business strategies, executives are preparing for permanent changes in their emphasis on employee health, leadership training, and areas of investment.
"It’s clear from the data that despite its acute effect, executives see COVID-19 as being overall less impactful than longer term business challenges such as automation or environmental concerns. Given the tremendous effects we are witnessing globally as a result of the pandemic, this underscores just how severe and dynamic the forces of disruption are in today’s business climate. Disruption is quite clearly the new economic driver," said Simon Freakley, CEO of AlixPartners.
Finding clarity in the chaos: leadership during disruption
85% of global executives say that disruption is the primary strategic challenge confronting business and society, yet only 37% have high confidence in their ability to withstand it. In fact, 51% of C-suite executives are worried about losing their job due to the levels of disruption facing their industry. Despite this challenging context, nearly 4 in 10 executives saw their organization as in a better place compared with a year ago.
"2020 was a high-pressure and high-stakes year for business, but the best performing executives were vigilant about disruption and, by being aware of it and actively addressing it, they have propelled their businesses forward," said Freakley. "Successful executives are finding the opportunity in chaos and complexity; they think about the impact of disruption to fuel a proactive response which not just mitigates but also harnesses today’s many disruptive forces."
If successful executives are those who address disruption as opportunities for their business, then cultivating this approach across their organization becomes a critical leadership task. 52% of all global executives think that a talent gap makes their organization vulnerable to disruption, which rises to 59% in the C-suite. Rather than investing in new technology, which is the top strategy cited by 53% of executives to withstand disruption, a more urgent priority for many is closing the talent gap as they face disruption.
Freakley adds, "Attracting top talent has long been front of mind for business leaders. A highly disrupted business environment brings a new focus to this issue as meeting the challenge of disruption requires a change of not just skillset but also a change of mindset. The most successful organizations in the face of continued disruption will be built upon best-in-class digital tools and techniques married to agility of thought, speed to action, and a relentless focus on execution."
Additional findings from the survey include:
Executives who consistently think about the impact of disruption – on their business, their employees, or their personal job security – view their companies as better off now than they were a year ago. 39% of global executives surveyed say their organization is better off now than one year ago; nearly 40% of the "better off" executives view disruption as an opportunity, while almost the same percentage of the executives who said they were "worse off" view it as a threat.
65% of global executives say they are highly impacted by two or more disruptive forces and to respond to disruption, organizations are taking an average of three to four actions. The most regularly cited response is investing in new technology – 53% of global executives are doing this.
Executives in China (50%) and the U.S. (48%) are among the most confident across markets in their organizations’ ability to withstand disruptive forces (by comparison 37% globally are highly confident). Italy (31%) and Japan (24%) are markets with the fewest executives saying they are highly confident in withstanding disruption. Nearly 1 in 3 (31%) of executives in the UK and Japan view disruption as a threat to their organization rather than an opportunity (vs. 23% globally).
37% of executives globally across industries are highly confident in their ability to withstand disruption. Despite this tumultuous year, Aerospace & Defense executives are the most confident in their organizations’ ability to withstand disruptive forces (45% highly confident), while Automotive executives are the least confident (29% highly confident).
Please click here to read AlixPartners’ full 2021 Disruption Index.
About the report
The 2021 AlixPartners Disruption Index is the global consulting firm’s survey of business leaders’ attitudes towards the forces that reshape business. The survey sampled 3,149 executives across the U.S., Canada, UK, France, Germany, Italy, Switzerland, China and Japan between November 16, 2020 and January 4, 2021. The executives span Aerospace & Defense, Automotive, Consumer Products, Financial Services, Media & Entertainment, Retail, Technology, Telecom & Cable industries. All surveyed were ages 25-65, director level or above and at a company with revenue of over $50 million. For more information, visit disruption.alixpartners.com.
AlixPartners is a results-driven global consulting firm that specializes in helping businesses successfully address their most complex and critical challenges. Our clients include companies, corporate boards, law firms, investment banks, private equity firms, and others. Founded in 1981, AlixPartners is headquartered in New York and has offices in more than 20 cities around the world. For more information, visit www.alixpartners.com.
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