Fast-track to future-ready

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Our findings show that advancing operations maturity boosts your efficiency and profitability. It's time to determine your direction and get on the fast-track.

We wanted to understand the connection between business operations maturity and performance. So, in 2020, we surveyed more than 1,100 C-suite and VP-level executives across 11 countries and 13 industries.

We identified four levels of operations maturity: stable, efficient, predictive and future-ready (See Figure 1).

Each of the four levels is underpinned by technologies that drive efficiency, insights and increasing capabilities.

Moving up just one level—from predictive to future-ready—yields a profitability increase of 5.8 percentage points and efficiency gains of 18.8%.

Our analysis also included an assessment of what we call transformational value. It characterises the future-ready state.

It explains how future-ready organisations are primed to capture performance gains and deliver excellent customer and employee experiences.

And our experience working with more than 400 leading organisations across 20 countries and 18 industries attests to productivity and efficiency gains up to 50%.


Figure 1. Where transformational value
intersects with intelligent operations

click image to enlarge


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Fast-tracking success

We found that:

  • Increased maturity raises efficiency and profits: Organisations that were one maturity level higher between 2017 and 2020 were, on average, 7.6% more efficient (lower operating expenses per dollar of revenue) and 2.3 percentage points more profitable (earnings before interest, taxes, depreciation, and amortisation as a percentage of revenues).
  • Being future-ready brings even more advantages: On average, future-ready organisations we surveyed show a 2.8x boost in corporate profitability and 1.7x higher efficiency than those at lower levels of maturity.
    Organisations in the stable and efficient levels that reached future-readiness by 2020 gained a 2.1x boost to operational efficiency and a 4.1x boost to profitability, compared to their peers that made more moderate maturity gains.
  • Operations maturity can boost global profits: Our modelling analyses indicate that if all organisations around the world moved from the stable, efficient or predictive levels to become future-ready by 2020, this would equate to US$5.4T in added global profitability.

To measure and predict progress, we looked at where organisations were three years ago, where they are today and where they’re predicted to be in three years. A majority of organisations have made dramatic progress toward next-level maturity over the past three years. But most (93%) have further to go (see Figure 2, middle column).

Most are committed to reaching a higher level of maturity in the next three years (see Figure 2, right side).


Figure 2. Maturity levels of survey respondents:
three years ago, today and three years from now.

Operations maturity chart for future-ready organisations

click image to enlarge


Organisations in high tech and insurance reported higher levels of maturity than others. In three years, we expect many sectors to leap ahead, particularly automotive, insurance and banking.

The largest future-ready organisations (those with revenues more than US$20B) reported greater improvements in operational efficiency. Seventy-three percent said their performance somewhat or significantly improved over the past three years, compared with 62% of those with revenues between US$2B and US$20B.

These businesses were also more likely to report improvements in their talent mix and reskilling efforts, employee engagement and retention and ecosystem partnerships. But we predict that small and medium enterprises will get there soon.

Making the
intelligent choice

Three ways to become future-ready

Surprisingly, we found that only 7% of respondents fall into the future-ready category.

How can others catch up?

The path to becoming future-ready is not necessarily linear. Even stable organizations can accelerate their journeys by moving up more than one maturity level. Adding intelligence to the journey—by applying a strategic approach to advancing the operating model and transforming the business through technology, processes and people—is critical.

Overall, we find there are three things you must know to become future-ready.

Girl in blue

01 Know the ultimate goal

Organizations tend to approach operations improvements too incrementally.

By contrast, those that are future-ready think big and start with the end goal in mind.

They then consider the bold moves it would take to close the gap between their aspirations and their current set-up (something our research shows many don't do).

Among the future-ready organizations in our study, 82% expect to scale leading practices across the enterprise within the next three years. And 86% of them expect business and technology functions to collaborate fully during that period. That's up from the 55% that say they do so today.

By comparison, 28% of efficient organizations expect to realize such levels of collaboration in three years. Just 3% say they are doing so now.

Shoes

02 Know the key steps

Some steps between one level of maturity and the next just can’t be skipped. Here are three that Accenture recognizes as crucial:

Step 1: Automate at scale

By 2023, nearly five times as many company executives expect their operating models to run end-to-end digitized processes compared to today.

Among organizations with future-ready operations, 38% are scaling AI, with 63% planning to have scaled AI in three years.

In stark contrast, just 1% of efficient organizations are currently scaling AI. Less than 20% expect to have scaled AI in three years.

Step 2: Augment human talent with technology

By fostering a human+machine workforce where technology helps people (not the other way around), organizations can allocate work to realize efficiencies. People will then be freed up for more creative and critical thinking—the best way to identify new sources of value.

More than one-third (34%) of future-ready organizations have already adopted an agile workforce strategy at scale. They can tap into ecosystem partners to mobilize people with special skills as needed.

In three years, that figure is expected to rise to 71%. But only 2% of organizations at the efficient level have adopted agile workforce strategies at scale. Just 28% expect to reach this goal in three years.

Step 3: Commit to data-driven decision making—using better, more diverse data

Experience and intuition are vital. However, as business complexities have multiplied, so too has the need for comprehensive, high-quality data to inform decision making. By using diverse data (structured and unstructured, internal and external, value chain vs. siloed) and elevating data quality, executives will be able to combine the best of both in a continuous feedback loop.

More than half (52%) of the organizations with future-ready operations are already using analytics at scale. Just 2% of efficient organizations say the same.

In the past, it would have taken organizations at least three years to advance even a single operations maturity level.

But now, moving ahead is much easier, thanks to the cloud and how it enhances data and analytics. Future-ready organizations reveal an impressive degree of maturity (90%) when it comes to using cloud infrastructure at scale for their existing processes today. And more than 78% are already planning to explore new areas for scaling cloud and maximizing value in the next three years. With today's cloud services, organizations can pay as they go when it comes to hardware and software, ramping their capacity use up or down as necessary.

Floor

03 Know how to leapfrog maturity levels

Future-readiness brings organizations a competitive edge and agility. But efficiency and profitability in the short term are not enough.

Being future-ready requires a flexible operating model—an optimized combination of multidisciplinary teams and technologies on demand that work across a broad ecosystem of partners. The goal: Deliver exceptional business outcomes at scale, from anywhere, anytime.

Ecosystem partnerships bring complementary skill sets and more diverse data. Together, they foster continuous evolution instead of one-time, project-focused improvements, and offer access to advanced technologies such as AI and blockchain.

Critically, partnerships also spark innovation.

Partnership models, anchored by a shared vision and mutually beneficial commercial terms, help deliver transformational value and experiences.

Future-ready organizations are clearly focused on the end rewards. More than three-quarters (77%) expect to further their stakeholder experience/ecosystem partnership strategies at scale within three years (up from 31% today). In contrast, 22% of the efficient organizations expect to scale in three years, up from 3% today.

Financial Times Agenda: How digital businesses are poised to win the recovery
Opinion and analysis by Manish Sharma, group chief executive Accenture Operations

Take the lead with the most advanced
human+machine intelligence powering
every decision

The journey to becoming future-ready by applying intelligent operations isn’t straightforward. Nor is it the same for everyone.

Now is the time to make your move to intelligent operations.

Here’s how:

  • Think big and go beyond incremental change
  • Enhance intuition with the highest-quality, diverse data
  • Scale automation and analytics, AI and integrated solutions with leading practices
  • Foster a human+machine, specialised workforce
  • Put a cloud infrastructure at the heart
  • Build complementary third-party and ecosystem relationships

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Full Report

Accenture reveals that the relationship between intelligent operations and business value creation is key to becoming a future-ready organisation.

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Infographic

Future-readiness brings organisations a competitive edge and agility but only a few are reaping those rewards today.

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Authors

Manish Sharma
Group Chief Executive, Accenture Operations

Kaushal Mody
Growth and Strategy Lead, Accenture Operations