Permanent challenges for executive will be competition and the battle for talent; change management strategies include flexible tactics.
Posted Oct 4, 2005
Tech company execs around the world think competition from both established companies and new ventures are the biggest challenges facing their businesses, according to a new report. Though the pace of change in the tech industry has moderated, executives say they must remain flexible in their strategies, business models, and cultures, according to the PricewaterhouseCooper (PwC) survey, "Embracing Change in the Technology Industries." The study, the first in a series of six entitled "Technology Executive Connections," surveyed 126 technology executives in 34 countries. About half of the companies had annual revenues greater than $1 billion.
PwC found that technology executives believe convergence to digital services and economic expansion in China, India, and Europe will have the biggest impact on their businesses in the next 10 years. Forty-eight percent of respondents said that competition from well-established companies is the top potential risk, followed by attracting employees and expertise (42 percent), and emergence of new startup companies (31 percent).
"The constant change in products and markets, and the combat for the best talent are abiding challenges for technology companies," says William Cobourn, PwC's global technology leader. "Technology executives say their companies are becoming more adaptable and better able to assess and manage risks and opportunities." To profit from these changes, technology executives say their companies must mange rapidly evolving risks by using flexible strategies, business models, and cultures. Building partnerships and alliances was considered crucial by executives to gain access to new technologies and ideas. These collaborative efforts were rated the second most-valued strategy, trailing only customer interaction. "The technology industry is probably better adapted to change than any other," says Kenny Fraser, global leader of Performance Improvement for Technology.
The survey also found that executives believe the pace of change in the technology industry is slowing. While 82 percent described the changes of the past 10 years as profound, just 71 percent anticipate the same level of change in the next decade. When asked what will have the greatest positive impact on technology companies in the next 10 years, respondents listed convergence to digital services (75 percent) and economic expansion in Europe (64 percent), China (63 percent) and India (62 percent). Negative issues and trends like global terrorism, rising energy prices, and cyber terrorism weighed lightly on technology executive's minds, according to the survey.
When asked which events or trends of the coming decade will be regarded in 100 years as the most important, most executives chose the growth of the Internet, the emergence of China, and rise of information-driven consumer power. Fraser says: "The survey highlighted that executives are still facing new challenges: To drive change that responds to customer needs, to build new partnerships and alliances to meet the risks of increasing complexity, and to find the best people to help them."
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