How to leverage three value drivers for successful transformation

Putting humans at the center

Companies that generate exponential value know how to put people — both customers and employees — at their center. This means building the business in a customer-centric way, while creating engaging experiences for employees. As leaders advance their strategies, they must view every decision, technological implementation and product or service innovation through human lenses.

In a post-pandemic world, business leaders are expected to focus on transforming the human dimensions of the enterprise, such as talent, leadership, organizational structure, culture and purpose. The critical role of human factors in catalyzing transformation underlies the objectives of upskilling or reskilling, better collaboration, agile decisions and transformative mindsets. According to the EY CEO Imperative Study 2021 — a survey of 305 chief executives of Forbes Global 2000 companies — 80% of CEOs believe putting humans (employees, customers and other stakeholders) at the center of decision-making will be a core value driver. Sixty-eight percent have at least one people-related transformation priority, while 15% have two or more people priorities.

Companies also need to consider how they can offer compelling value propositions to delight their customers. Personalized experiences have become a major driver of consumption, requiring a different and innovative approach to customer engagement.

As companies adopt new technologies and drive innovations, the board should challenge the management on whether it has carefully considered the human impact to mitigate risks and create trusted relationships with customers, employees and ecosystem partners. A consistent human-centric approach will help motivate employees and attract customers, giving the company a competitive edge and ultimately leading to a stronger market position.

Leveraging technology at speed 

Technological acceleration remains one of the most significant drivers of transformation and rides on the digital momentum arising from the pandemic. Sixty-eight percent of respondents in the EY study expect to make significant investments in data and technology over the next year, while 63% said accelerating technology and digital innovation is having the greatest impact on their company. With new technologies emerging and maturing more quickly, companies that can use them as instruments of creativity will likely perform better.

In their zeal to adopt new technologies, however, companies must not lose sight of building trust with stakeholders. The board should assess if the company carefully considers the human impact of every technology before large-scale deployment, given the growing public awareness of security, privacy and ethical risks.

To successfully leverage technology at speed, the board should guide the management in the upskilling and reskilling of employees as well as establishment of a transformative mindset across the entire organization. It is also important to question if the management has implemented forward-looking risk management practices and strong cybersecurity capabilities to fully realize the value of technology to improve the human experience.

Driving innovation at scale

The pandemic is forcing companies to reimagine every aspect of their business. While all companies need to protect their core business, they also need to get into the habit of continuous innovation. Thirty-eight percent of respondents in the EY study expect to implement change in their innovation processes over the next three years. The board and management can take a “future-back” approach and ask whether the company will be relevant in 5, 10 or 15 years as well as how it might expand its competitive advantage through bold risk-taking. They can then explore potential scenarios to shape the company’s innovation agenda.

Companies should also look externally to enrich their innovation potential. Collaboration with ecosystem partners can help generate ideas that appeal to customers, employees and markets. Ecosystem partnerships can also allow them to leverage data, cutting-edge smart technologies and cloud infrastructure to scale up innovation more rapidly. The board should challenge the management to consider whether the existing business strategy can be accelerated through partnerships and alliances as well as the investments needed to do so.

Perhaps most critical in driving innovation is keeping human talent front and center. As business leaders implement changes in their innovation processes, achieving objectives — such as faster idea generation and trialing or reorienting the organization toward greater risk-taking — requires empowering employees to take measured risks. 

Boards should consider the following questions: 

• Does the management drive a human-centered mindset in innovation processes, technology adoption and deployment as well as every aspect of the organization’s culture? 
• What are the existing channels to get direct feedback from customers, employees and ecosystem partners to inform decision-making?
• How is the organization obtaining, managing and using data in ways that gain the trust of customers, employees, ecosystems and regulators?
• Does the organization have a capital strategy to invest in digital and platform initiatives for the next few years?
• Does the organization have a leadership action plan and an enterprise transformation plan to address key strategic, operational and cultural gaps?

This article was authored by Juang-Wei Mok, former EY Asean Consulting Markets Leader.