Fine-tuning for greater performance
As executives fine-tune their firms to perform better, operational agility remains central to surviving — and flourishing — in a volatile world economy.
Part of this fine-tuning focuses on bolstering productivity, where many companies think there is room for improvement. In mature markets, where companies face the most acute pressures over pricing and profitability, executives cite this as their second-biggest opportunity, ahead of growth in new markets.
Productivity is also a high priority in rapid-growth markets, ranked fourth overall.
A high priority for business is the need to make sure that decisions reached at the top level are actually implemented on the ground.
Improving the execution of strategy fell to fifth place in this year’s rankings, from the top slot in 2011. Mature market respondents still consider this well ahead of their peers in rapid-growth markets, putting it in fifth place as compared with last time.
IT investment, a crucial element of strategy implementation and overall performance, is seen as the sixth-greatest opportunity, and among the top five within mature markets.
A perennial challenge for those seeking to expand and innovate, the risk of managing talent and skills shortages fell to fifth overall, down from third.
Global optimization and the relocation of key function make the top 10 opportunities list for the first time. For multinational organizations trying to balance the desire for cost competitiveness in key markets, as well as growth in new markets, rethinking the cost and location of operations from a global perspective can deliver a range of opportunities.
What it all means for businesses
Operational agility can be achieved by those managers who can drive a net increase in productivity, either within process, tools and training or through supply chain flexibility. The most important lesson for companies is not to wait the downturn out. Instead they must be proactive in identifying the opportunities available to them, whether in IT, talent or relocation and optimization. Their success will depend on how innovative they are prepared to be.
To mitigate the risks and enable opportunities companies could: