A frustrating phrase has crept into daily language in recent years: ‘it is what it is’. While there are givens in life, each time leaders and managers default to this rather than what ‘it’ could or must be, there is a missed opportunity to demonstrate leadership and strengthen their business.
Business leadership is more important than ever. South Australia’s economic challenges are well-documented, with our state’s economic indicators lagging in performance across national key metrics.
To ensure that SA is a great place to work, and not just to live, strengthening and developing globally competitive businesses is paramount. Although the state’s major economic sectors have different challenges and opportunities, there are some common themes from successful business leaders and the strategies they are pursuing. Research by the PwC Chair in Digital Economy at Queensland University of Technology (QUT) identifies four key factors:
1. Revealing a deeper value proposition to customers — It’s not just about what businesses do and make; it is invariably the collective value of people, how services are provided to customers, the quality of supply chain, and a track record of delivery which create value and help solve customers’ problems. The research at QUT identified the number one characteristic of high-growth firms as their ability to articulate their unique value and adopt tailored marketing strategies, and yet some businesses and boards remain in a product/service paradigm. This underscores the fact that grasping the value proposition of our businesses is key to telling the state’s collective ‘story’, growing markets, and competing on a broader value proposition in new markets.
2. Encouraging workplace culture and agile management — The same research identified these qualities as integral to success, through building a culture of co-creation, idea sharing and teamwork. While the success and growth of these businesses almost always inflicted intense pressure on people, leadership typically set expectations on management to plan for the pressures of growth.
3. Defining a markets and growth strategy — Whether it is a national or international markets approach, there is a necessary strategic and markets discipline to taking businesses’ value proposition to new customers and markets, and success varies. Identifying, qualifying and targeting customers, developing a proposition to take to market, and having the flexibility to work with new partners under different commercial models and/or under foreign regulatory and tax environments are capabilities that many businesses must develop over time. The ability of boards and leaders to enable these market-oriented strategies is essential, but first there needs to be a pragmatic assessment of whether and how these strategies can be successful, appetite for risk, and whether ‘it’s worth it’.
4. Embracing the challenges and opportunities of digital — Businesses’ digital strategies and innovation culture can work together across the spectrum of customer, growth, cyber security risks to cost management objectives. Businesses are pursuing digital initiatives and investments to remain relevant to customers, as well as to neutralise the threats of disruption. In PwC’s most recent CEO survey, the investments seen to generate greatest return were data and analytics (67 per cent), social media (63 per cent), and CRM systems (53 per cent).
We see the pace of change continuing to increase, new technology solutions coming to market, and changing economics for technology and systems investment. Market trends underscore the fact that digital must be ‘front and centre’ for management and strategy, as well as the need for business leaders to watch the evolving technology landscape closely and to understand what it means for them. While these issues speak to some of the common aspects of what businesses are doing, there remain the intangibles of organisational culture that still make or break many businesses’ efforts.
There is no shortage of viewpoints on whether it’s a case of ‘culture versus strategy’, an alignment of the two, or something else altogether. Whatever the case, there are great opportunities for our business leaders to relegate the language of ‘it is what it is’ to other topics and lift the conversation to what we must do to grow and strengthen businesses in our state.
Brad Gay, Senior Manager, PwC