PricewaterhouseCoopers charts eight imperatives for driving competitive advantage
by AccountingWEB on
Businesses face eight strategic imperatives that will play determining factors in their short- and long-term success following the economic crisis, according to a new report from PricewaterhouseCoopers LLP (PwC).
The report, “10 Minutes on Competitive Advantage," distills information and insights from PwC's Global CEO Survey and its U.S.-focused report, as well as interviews with thousands of PwC clients. The report provides key data points, a model that enables companies to map their strategy versus peers on critical business issues, and recommendations to help develop a clear action plan for smart, strategic growth, according to the company.
- Sustain cost-reduction measures in order to improve margins with a smaller, more productive workforce, and use newly freed resources for investments in the company's future.
- Align risk to performance and create individual accountability measures by integrating risk at a business unit level and creating more personal accountability and reward structures.
- Prepare for major regulatory changes through a cross section of issues–international tax frameworks, infrastructure development, health care costs, and environmental policies.
- Enhance trust in your business through voluntary disclosures or independent verifications in areas such as supply chain integrity, measurement of carbon emissions, and data integrity to satisfy discerning stakeholders who now demand greater levels of transparency when making decisions about where to invest.
- Make technology a strategic asset and competitive differentiator by increasing your investment in technology infrastructure and applications.
- Leverage innovation to underscore differentiation, especially around hot-button global issues such as sustainability and climatechange.
- Move forward with deferred transactions and deals to help grow, protect value,and capture benefits of scale, productivity, and efficiency.
- Invest in leadership, talent development, and deployment of your employees, starting with the C-Suite.
Using the Competitive Leadership Model within the report, business leaders can understand how their business compares to industry peers and other leading companies. This framework allows for both a macro view of large, strategic issues that can determine competitive advantage, as well as a more micro view of the drivers necessary to help achieve sustainable success. Findings can then be used as a roadmap for an actionable, and potentially transformational, plan of how to expand market share.
"Executives must renew their focus on the most important issues to accelerate growth – both top and bottom line," said Bob Moritz, U.S. chairman and senior partner, PricewaterhouseCoopers. "We believe that organizations that better engage key stakeholders while also making strategic IT, innovation, M&A, and people investments will unleash potential growth that will create long-term competitive advantages."
These strategies have become particularly important as U.S. CEOs continue to respond to the significant shifts underpinning America's economic recovery, according to the firm. When asked about threats to business growth as their companies emerge from the recession, CEOs express the greatest concern about the prospect of overregulation, followed by shifts in consumer behaviors.
These concerns weigh more heavily in the U.S. than elsewhere: 71 percent of U.S. CEOs are either somewhat or extremely concerned about overregulation compared to 60 percent of global CEOs; 62 percent of U.S. CEOs worry about changing consumer behaviors compared to 48 percent of global CEOs.
Meanwhile, concerns involving talent shortages have temporarily receded in the U.S., with CEOs focusing on organizational redesign and employee engagement and morale programs.