68% expect generative AI will significantly change the way their company creates, delivers and captures value in the next three years.
The past few years have been filled with uncertainty—significant economic shifts, geopolitical conflicts and a rapidly evolving technology and intelligence landscape. Not all businesses have navigated this environment with equal success, but the leaders who have been successful have one thing in common. They are focusing on what they can control to create value and safeguard what matters most: trust, their people and business performance.
MANAGING RISK IN A DYNAMIC ENVIRONMENT
Reinvention can take management teams into new territories ripe with opportunity. The other side of that opportunity is risk. It is critical that leaders identify, plan and safeguard their business from the risks that can make them most vulnerable.
Cybersecurity continues to be a top concern, and with business strategically integrating and leveraging AI more, 77% agree GenAI is likely to heighten cybersecurity concerns. Competition from new and existing competitors and the need to upskill the workforce are other risks for CEOs to consider and create proactive strategies around. The fallout of not managing these risks could impact trust, operations and other areas of the business.
Transparency around GenAI is a key component of risk management, and it’s worth its own focal point. It’s clear that executives believe GenAI will be a catalyst for business transformation. GenAI has the potential to revolutionize industries and build entirely new markets and opportunities. Sixty-eigt in the next three years, GenAI will significantly change the way their company creates, delivers and captures value.
The success of GenAI in part hinges on trust: Do your internal and external stakeholders trust your GenAI strategies and the inputs and outputs of your GenAI systems? Leaders should encourage teams to focus on three things: 1) strengthening an AI narrative inclusive of what the future of work means for the business and workforce, 2) empowering your people, and 3) prioritizing governance, risk strategies, and responsible-use policies into design. Business leaders should be consistent in their AI messaging to investors, employees and other stakeholders, emphasizing the need for transparency and clear communication. Getting these three things right is critical to creating lasting value.
EXPANDING MARGINS TO FUEL REINVENTION
Competition is tough today, no way around it. Businesses are improving intelligence, scaling and growing fueled by analytics and GenAI. Businesses are just smarter today than they have ever been. However, to keep the momentum going, they need capital to put back into the business so they can go deeper on analytics, data and GenAI. This can be tricky in today’s landscape which puts heightened pressure on businesses to improve profitability—meaning CEOs focused on reinvention are also hyperfocused on margins as one hand feeds the other.
GenAI is partly responsible for increased competition. Sixty-five percent of US CEOs in the Global CEO Survey say that in the next three years, GenAI will increase competitive intensity in their industry, and one way it can do so is through helping businesses improve margins through efficiency. Those who have not experienced these efficiencies and may have lagged in their transformation journeys, are now facing a non-competitive cost structure which is likely hurting their margins. This is the year to catch-up and go bold with your business agenda.
DRIVING REVENUE GROWTH
In spite of everything that’s new, revenue growth is still critically important. Today, revenue growth is about scale and increasing revenue streams—thinking about your portfolio and business model in new ways to expand opportunities for top-line growth. Revenue growth should be a key pillar in everyone’s reinvention strategy. According to our 2023 Trust Survey, 52% of CEOs say their number one goal over the next three years is generating new revenue streams, which may mean leaders will help create an increasingly bullish market this year.
Executives will likely look to dealmaking to shape their business’ future. Leaders who take decisive action may gain an advantage over their competitors – critical to winning in today’s landscape.
This year we can anticipate a higher level of scrutiny around deals with higher expectations for how the acquisition will generate value. Adding scale without thoroughly analyzing and dealing with the transformation realities will make it much harder for deals to go through. Leaders should be clear and precise on value creation in any new deal.
It will take focus, but honing in on risk, transparency, margins and new opportunities to grow revenue can help companies advance their long-term reinvention strategy, competitiveness and value creation for stakeholders. And if the past decade has taught us anything, it’s proven that leadership teams can lead, inspire and transform in an uncertain world.
Courtesy : https://www.fastcompany.com/91047616/genai-and-cybersecurity-top-ceo-concerns-in-new-pwc-survey