3. How can technology at speed create competitive advantage?
The pandemic highlighted many organizations were overestimating their digital maturity, while underestimating the critical and urgent need for digital transformation. In EY’s Tech Horizons survey, we determined almost every company was already on a journey to digitally transform its business; however, only 4% said transformation was fully embedded and optimized across their operations. Post-pandemic, companies wanting to be digital transformation leaders will need to exhibit six habits: put customers first, accelerate AI to drive growth, promote innovation through ecosystems and partnerships, nurture talent with new incentives and strategies, activate governance plans for emerging technology, and use data and agility to power innovation.
At the same time, with a much larger workforce at home, companies will have to contend with an exponential rise in cybersecurity risks. Even before the pandemic, 59% of executives in EY’s Global Information Security Survey (pdf) said their organization had faced a material or significant incident in the past 12 months. During the pandemic, the media has reported an escalation in incidents as hackers take advantage of organizations focused on addressing the crisis — from hospitals and health care providers, to law firms. Looking beyond, cybersecurity will have to be embedded into every transformation journey — as will privacy protections, for customers and employees.
4. Where does innovation at scale meet the new “S-curve” of growth?
Since World War II, the global economy has been following an extended S-curve of growth — a pattern of growth in which a disruptive concept, technology or market starts with low adoption initially, followed by dramatic growth before slowing again as the model matures. Following the S-curve, global companies used the traditional value drivers of scope, scale and efficiency to measure performance and value. Companies that accelerated out of previous global shifts — US auto manufacturers post-World War II and hypergrowth “unicorn” companies post-financial crisis — have shaped the world we live in today.
Post-pandemic, we expect a new generation of leaders will emerge, operating by the rules of a new non-linear S-curve, where innovation timelines compress and ideation, prototyping, piloting and commercialization happen on parallel tracks. Examples of companies already experimenting with the new S-curve include a household appliance maker developing and commercializing a new ventilator in 30 days, distillers shifting from making spirits to making hand sanitizer, and pharmaceutical companies going directly from COVID-19 vaccine research to human clinical trials. Innovating at scale along this new growth trajectory requires companies reinvent their operations to be data-driven, support hyper personalization, rapidly orchestrate ecosystems of value and address the reshaping of globalization.