By Linda Ban and Shanker Ramamurthy
The most successful C-suites have a diverse representation of skills, bringing together unique backgrounds, qualifications and experiences – ideally suited for a connected world.
Within a C-suite, there are many different relationship and collaboration models between CxO members, and there are also a many perceptions about the role they each play in setting the strategy for an organization. While CEOs are concerned that other C-suite members aren’t focused enough on the long term strategy three to five years out, other CxO members fear their leaders are too stuck in the weeds with operational concerns. With a clear disconnect in the boardroom, it’s time for members of the C-suite to start working together to prepare for what’s next: an interconnected economy.
Digital technologies have already wrought profound economic changes. A producer-led economy has been superseded by an economy centered on the individual, in which the consumer has a far bigger say. Customers demand individualized, seamless experiences, and they’re looking for even more.
Today’s individual-centered economy will give way to an everyone-to-everyone (and every thing) economy, as analytics, cloud, social and mobile technologies make entirely new operating models possible. In the E2E economy of the future, customers, companies and vast ecosystems that include partners, and even competitors, will work together to create value. They will co-fund, co-design, co-produce, co-market and co-distribute new offerings.
As the world becomes more interconnected, successful C-suites stand out for their ability to fully embrace collaboration, without getting too friendly and losing their ability to be objective. Challenges exist, however, in how everyone works together.
Where’s the Customer?
As the E2E economy gives customers even more clout than they have today, many organizations are not prepared for these changes. According to “Exploring the Inner Circle: Insights from the Global C-Suite Study,” recently completed by the IBM Institute of Business Value (IBV), only 41 percent of CEOs say they understand their customers very well, and more than a third expressed doubt that their C-suite is keeping up with the way the marketplace is rapidly evolving.
During face to face interviews conducted with top executives from around the world, one CEO of a U.S. retailer confided “it’s difficult keeping everyone at a high level and making sure they don’t get bogged down in the details,” while a CEO from a South African bank said, “we spend too much time focusing on the problems of today rather than the problems of tomorrow.”
Moving from the here and now to charting a course for the future requires a concerted effort by the entire C-suite.
Setting the Strategy for the Future
While CEOs involve their C-suite colleagues in formulating business strategy, they tend to turn most frequently to the CFO for finanical issues and the CMO when it comes to identifying and targeting the customer. Depending upon the topic, other CxOs may be involved to a degree, but the C-suites that encourage involvement from those with diverse experiences tend to have more outperformers. C-suites that promote purposeful partnerships collaborate more with customers, partners and employees, and see collaboration as the primary vehicle to drive innovation and create competitive advantage for their organization. This, in turn, allows them to convert that deep understanding of all of their constituents into better financial performance.
In the new interconnected world, no one can do it alone. Success requires a deep understanding of the marketplace and the organization, as well as a strong willingness to collaborate both internally and externally. Without these key skills, organizations will not be ready to take their place in the interconnected economy of the future.
For more insight into various collaboration styles and performance factors please read the full study at www.ibm.com/csuitestudy.