Digital transformation is the name of the game in 2020, according to a survey of nearly 200 C-suite executives by KPMG Australia. The third annual Keeping us up at night: The big issues facing business leaders report found that the concerns of business leaders are rapidly changing, with digital transformation top concern followed by the unstable global political and economic environment.
Innovation and disruption is also a key focus, as well as sustainability, climate change, public trust, domestic political paralysis, and workforce upskilling.
“It’s not surprising that digital transformation remains the top issue, and in many ways pervades the survey, given its close linkage to the fourth-placed innovation and disruption,” KPMG Australia chief executive, Gary Wingrove, said. “This indicates that Australian CEOs are acutely aware of the need to reimagine their organisation of the digital era, while harnessing new technologies such as blockchain and artificial intelligence.
According to the report, many business leaders believe over-regulation is inhibiting innovation, and that regulation tends to be introduced quickly and with little consultation with business.
Global issues a key concern
With many large-scale political events occurring around the world, c-suite executives are more concerned with how this new global environment will affect their business, with some believing the greater volatility will act as a barrier to expansion. Additionally, a decrease in multilateralism, a perceived lack of global leadership, and a shift away from economic logic toward political logic worry many leaders.
“There is a fear that the world will experience a schism on technology such that one is forced to align with one or other of the major superpowers,” KPMG economics and tax centre partner Grant Wardell-Johnson.
“Some Australian businesses and universities now fear it may be difficult collaborating with both the United States and China. A few years ago there was focus on the cross-pollination of ideas in technology, but this may now be curtailed.”
A growing concern for business leaders is climate change, growing from 14th place last year to equal fifth in 2019, with respondents believing the issue is a victim of political paralysis and wish to see clearer direction from both government and the business community more widely.
Wingrove said he expects to see the issue continue its upward momentum on CEO agendas in the coming years.
“There is a clear obligation on businesses to acknowledge, understand and plan to mitigate the risks associated with climate change as a practical problem,” Wingrove said. “There are now deemed foreseeable and material. Those in sectors not used to thinking about the natural environment as a critical factor need to change their mindset.”
The top 10 big issues facing business leaders in 2020:
2. Global political and economic environment
3. Regulation and regulatory environment
4. Innovation and disruption
5. Sustainability and climate change
5. Public trust
5. Leadership capability, accountability, stability
8. Customer and citizen centricity
9. Political paralysis and effective government planning and response
10. Workforce upskilling and transformation