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South African CEOs: A golden window of opportunity to disrupt

In the 21st century world of business, the only constant thing is change. According to the KPMG 2017 Global CEO Outlook, CEO’s are recognising the opportunities that come with the Fourth Industrial Revolution and are excited to make the most of it[1]. South African CEO’s acknowledge this too.

However, they are yet to put their knowledge into practice: while the rest of the world is projecting greater investment in innovation, including new products, services, customer experience and ways of doing business, local captains of industry largely predict no new investment in these areas in the foreseeable future[2]. This could speak to the climate of economic uncertainty they find themselves in. Globally, CEO’s have reported a loss of confidence in global economic growth, and many have taken a neutral, “wait and see” attitude toward economic change[3].

Regardless, many less developed Sub-Saharan economies have innovated a lot more than their current level of development would predict, and have proven that positive change is possible despite a negative economic outlook[4].

So is playing it safe worth it in the long run? As consumers demand more transparency and become more digitally savvy and critical, the ability to understand what customers value and how brands are perceived in the market is indispensable[5].

The effectiveness of any technological development depends on how companies use it to influence their customers’ decision making. By harnessing insights from nudging, CEO’s can capture the human element in the digital revolution. In other words by designing a superior process with a powerful interface that captures human intuition and brute force machine power you get a winning combination. Then you don’t only get intelligence, you get useful intelligence.

This is what our future consumers will demand and they will be unwilling to settle for a brand which can’t evolve with those demands[6]. By applying behavioural principles to innovation, firms can get inside a consumer’s mind and improve the quality of their products and find better ways to engage with customers. This will boost competitiveness in a changing environment, securing a unique brand and identity.

When one looks at the pace of change, opposing revolutionary trends in technology guarantees failure and could lead to alienation in an increasingly digitalised market. South African CEO’s are aware of the rapid pace of technological change and its impact on their business, and now is the time to put that knowledge to use. If our leaders don’t take up the challenge and revolutionise they may lose out on a window of opportunity. An opportunity which can leapfrog their company into the digital era…and everyone knows this.[7]

For more information:

lulluLullu Krugel
Chief Economist
KPMG in South Africa
T: +27 (0) 82 712 4049
E: lullu.krugel@kpmg.co.za
View all posts by Lullu Krugel

 

 

[1] KPMG Global CEO Outlook; p95,133

[2] KPMG Global CEO Outlook; p24

[3] Disrupt and Grow, KPMG 2017 Global CEO Outlook; p11

[4] Innovation Feeding the World, Global Innovation Index 2017; p26

[5] Disrupt and Grow, KPMG 2017 Global CEO Outlook; p25

[6] Disrupt and Grow, KPMH 2017 Global CEO Outlook; p29

[7] Disrupt and Grow, KPMG 2017 Global CEO Outlook; p10

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About Lullu Krugel

Lullu Krugel is employed as a Chief Economist at KPMG's Johannesburg office. Over the past nine years that she has been employed at KPMG, she has acted as an advisor and project manager for a range of private and public sector clients wanting to invest in South Africa, but also in the rest of the African continent. Her specific areas for focus are economic and socio-economic impact assessments of major capital and infrastructure projects, feasibility studies and market assessments, cost benefit analysis, commercial due diligence analysis, pricing, policy analysis and modelling and econometric modelling. Lullu is a frequent presenter at local and international conferences and a regular commentator in the media, where she shares her insights about opportunities on the African continent. She was also part of KPMGs team for the BRICS summit and the KPMG National Development Plan team. For the latter project, she played a key role in the working group that prepared the business response for the South African National Development Plan on behalf of KPMG and KPMG clients, in particular with regards to job creation and economic growth. Her sector focuses include agriculture, infrastructure, healthcare and manufacturing. Lullu holds a Masters degree in economics from the Potchefstroom Campus of the Northwest University, where she was also an economics lecturer.

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