“When you are operating on the edge of uncertainty, there are no answers.”
Hal Gregersen, executive director at the MIT Leadership Center, is clear about what a rapidly changing environment means for CEOs. Proliferation of technology and evolving customer expectations are throwing up new challenges and creating new norms. And the only way business leaders can successfully navigate a Business 4.0 world is by asking the difficult questions.
Without constant examination, CEOs risk becoming isolated – failing to respond to the evolving demands of their customers and instead continuing to tread the same familiar path they always have.
Creating businesses that constantly innovate to stay ahead of the disruption curve is the challenge for today’s CEOs. In a world where the lines between corporations and their partners are becoming increasingly blurred, great CEOs draw on the expertise and diversity in their ecosystems.
This was the topic of discussion during the Building Companies That Disrupt Themselves panel at TCS Summit 2019 North America in San Antonio, Texas. Moderated by Gregersen, executive panelists included Chandra, Chairman of Tata Sons, Hans Vestberg, CEO and Chairman, Verizon Communications, Stuart Parker, CEO, USAA, and Jon Roberts, COO, CVS Health.
Building the right culture
“More listening, less talking,” is how Chandra believes CEOs can leverage the expertise within their businesses. Leaders need to be open to feedback from all sources and willing to consider opinions from the full range of people they interact with.
He also explained the role of CEOs as drivers of culture and behavior in their businesses – both of which are crucial to success.
He believes there are four components to a company. Culture is the foremost, with behavior – as driven and exhibited by the CEO – also crucial. Metrics are key to monitoring and informing. And all three come together to influence the final pillar, which is perception.
Hans Vestberg also underlined the importance of culture, “You need leaders in philosophies….You need the right culture. The best strategy ever will be no good if you don’t have the right cultures and behaviors.”
What’s the purpose?
The companies that will find the most success in the Business 4.0 world are those with a clearly defined purpose. A business needs to be considered through the lens of its customers.
This means understanding what their offerings are and what makes them different. And this can sometimes lead to moving away from areas that aren’t their core focus, working instead with expert partners to provide the best for customers.
USAA provides a good example of this. The banking and financial services group chose to move away from creating its own investment products, instead to partnering with more specific providers, so it could concentrate on its broader core mission of taking care of military families.
“Truly understanding your mission and your purpose really brings the pulleys together,” Stuart Parker explained. “If you know what your mission is, it really helps you make your decisions.”
Being purpose-driven can also have a wider impact on the way businesses work Jonathan Roberts believes.
“Our biggest challenge is getting people to think with an enterprise mindset – ‘how can I do what’s best for the company, even when it might not be what’s best for my division?” he said.
How do you lead a company through a transformation journey? @hansvestberg, Chairman & CEO of @Verizon Communications, tells business leaders at #TCSsummit the key is to gain buy-in from stakeholders, remember the greatness and embrace change. @VerizonNews pic.twitter.com/l3nAgOVoWX
— Tata Consultancy Services – North America (@tcs_na) September 9, 2019
Driving innovation and taking risks
As digital transformation gathers pace, there is an increasing burden on companies to innovate to stay ahead of the curve. And tapping into your ecosystem is crucial for this innovation. It is not just the big changes that count – the smaller incremental changes all add up.
But, Chandra cautioned, “You cannot achieve innovation by just creating a department of innovation…it needs to be in the DNA of the company.”
Being uncomfortable and willing to embrace risks can ultimately lead companies to offer customers more value. As USAA’s Parker told summit attendees, “progress over perfection and a willingness to fail and have awkward conversations has helped us create a more agile business.”