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Required, now more than ever: the fortitude for perpetual reinvention

Perpetual reinvention

Two decades after the Internet became a platform for transformation, we’re still wondering how it all might turn out.

The signals aren’t always clear.

Today, winner-take-all organizations are on the rise, but collaborative ecosystems are flourishing as well. Even in industries where competitive concentration is increasing, innovation hasn’t – as would be expected – flatlined.

Which way to the future?

The organizations that are prospering aren’t lying in wait to time the next inflection point – the moment when a new technology, business model or means of production really takes off. Remaking the enterprise, they recognize, isn’t a matter of timing but of continuity.

What’s required, now more than ever, is the fortitude for perpetual reinvention. It’s a matter of seeking and championing change even when the status quo happens to be working quite well.

Economists and strategists are debating both the causes and consequences of markets that are growing less competitive. Some attribute the consolidation of power into the hands of a few to digital technologies; others point to structural factors.

C-suite executives may be just as uncertain about the changes happening around them. Certainly, their expectations about how the business landscape will change in the next few years are mixed.

The C-suite is evenly divided on whether the focus in the future will shift from established markets to new ones. After years of predicting a move to open innovation – sourced externally – a growing number of C-suite executives are now predicting a retreat to proprietary innovation. And yet, a significant number also cite new capabilities – and intentions – for collaborative innovation.

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In two areas, however, C-suite executives stand in close agreement: how they will change their value propositions and scale their value chains. Two-thirds, 68 percent of global and 65 percent of Greater China C-suite executives, expect organizations to emphasize customer experience over products. And 63 percent of global and 59 percent of Greater China executives believe that most organizations will continue to expand their networks of business partners.

In the 14 years IBM has surveyed C-suite executives, we’ve asked them which external forces will impact them most in the next two to three years. This year, market factors, which includes things like increased competition and changing customer preferences, returned to the top position, while technology slipped to second place. People skills rose sharply to third place, recognition perhaps of the rise in value of intangible assets like talent and ideas
To better understand the forces at play, we applied cluster analysis to identify distinct segments of organizations among the more than 12,500 participants in this study. Three archetypes emerged, which we’ve named the Reinventors, the Practitioners and the Aspirationals. The organizations clustered in these archetypes are at different stages of Digital Reinvention™ and are eyeing the opportunities ahead from that vantage point.

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