While many organizations have been having a tough time of late, I’m encouraged to learn from our research that there are some industries that are ready for the future and many others are focused on improving their readiness.

When I shared the findings of our Intelligent Operations survey earlier, I talked about how we had classified responses from more than 1,100 C-suite and VP-level executives into one of four levels of operational maturity—stable, efficient, predictive and future-ready. Unsurprisingly, future-ready organizations not only perform better, but also gain the resilience and agility to keep generating overall business value.

How?  Well, 90% of future-ready organizations use cloud infrastructure at scale today. They are data driven, have end-to-end digitized processes, an agile workforce that leverages specialized talent and are artificial intelligence (AI)-, cloud- and blockchain-enabled. These new ways of working help them to continuously improve their operations and find new sources of growth.

The Accenture Technology Vision 2021 found that 77% of executives state that their tech architecture is becoming very critical or critical to the overall success of their organization. And another recent global survey shows us the powerful benefits of being a leader that adopts new technologies—not least the ability to grow five times faster than laggards. But unfortunately, many organizations still have a way to go. Only 7% of the organizations we surveyed are future-ready.

Of course, some industries are beating the odds. Industries like Insurance at 10% and High Tech at 9% are more future-ready than most.  And they have an incentive; High Tech organizations that make the move to being future-ready are realizing 7.3% higher revenues.

I’m pleased to say that all industries are heading upwards, with some indicating that they will be up to six times more future-ready in three years’ time.

I’ve always said, there’s no one-size-fits-all when it comes to operations. By looking more closely at the responses of specific industries, we can see they don’t all behave the same—and they all have areas where they could do better.

Shifting industries

Aside from the universal disruption of the pandemic, every industry has its own challenges. We can see how Banking is being reinvented by client expectations, regulations and new, aggressive competitors.

Insurance has been impacted for some time with events linked to climate change—which is also affecting the Automotive industry, causing it to rethink its business model. Health is being challenged by the need to scale technology. And traditional Retail practices are being upended by changing consumer behaviors toward a more online approach.

Difficult times call for exceptional measures. I believe what could be a positive influence on helping industries to face these challenges is how they prepare for the future by embracing intelligent operations. Communications, Health and Media industries all fell below the average at 4% as having the lowest view of being future-ready today. Three years ago, no insurers would have said their operations were ready for the future.

In all, eight out of 13 industries were below the 7% average for current future-readiness (take a look at Figure 1 for more detail).

Figure 1. 

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Since a combination of climate change and customer expectations is causing such a huge shift in the Automotive sector, it is interesting to note that 48% of respondents in this industry consider that they will be future-ready by 2023. While an industry which has seen less dramatic movement in its traditional business model, Media, has more modest ambitions, being the lowest at 22%.

Know your strengths

To give you a few more insights into our industry analysis, I thought it would be helpful to take a closer look at industries’ ability to scale the eight characteristics of operating model maturity: data, analytics, leading practices, business-technology collaboration, agile workforce, automation, stakeholder experience and AI.

Knowing your own strengths and weaknesses is a good start to better understanding what you need to do to move forward. And although there is work to do in each industry, some are already scaling well (see Figure 2 for more detail).

For instance, Banking is has more work to do to secure an agile workforce and better automate, but 78% of Banking executives say they currently have data in wide use or at scale—that’s 3% more than the average of all industries. Similarly, Insurance has room to grow in innovative areas like AI adoption but 83% of insurers have strong data usage, again ahead of the average.

Figure 2. 

CHARACTERISTIC

ALREADY AT SCALE

MORE WORK TO DO

AGILE WORKFORCE

Communications, Consumer Goods and Services (CG&S), Health

Banking, Industrial Equipment, Media, Retail

AUTOMATION

Communications, CG&S, Health, Industrial Equipment, High Tech

Banking, Media, Oil & Gas, Retail

DATA

Automotive, Banking, High Tech, Insurance

CG&S, Oil & Gas

BUSINESS-TECHNOLOGY COLLABORATION

Retail, High Tech, Life Sciences/Biopharma

 

ANALYTICS

High Tech, Life Sciences/Biopharma

Communications, CG&S, Industrial Equipment

LEADING PRACTICES

Life Sciences/Biopharma

Life Sciences

STAKEHOLDER EXPERIENCE

Travel, Automotive

Communications, Life Sciences/Biopharma

ARTIFICIAL INTELLIGENCE

 

Industrial Equipment, Insurance, Media, Oil & Gas

And there is an incentive to improving those areas where industries fall short. In fact, we found that if all organizations were future-ready by 2020, it would equal US$5.4T in added profitability. And if they climb one position in operational maturity, they can see a projected 17% increase in global profitability.

I’ve seen this for myself. Accenture worked with a global food and beverage company, introducing a human-machine operating engine to standardize hundreds of processes and apply automated analytics solutions to transform HR services. The company not only improved service quality but also boosted the productivity of HR and Finance services by 35%. The thousands of hours that were historically spent on manual tasks can now be dedicated to more strategic activities focused on growth.

We also helped an insurer apply analytics to multiple areas of its debt portfolio to improve its debt collections and close nearly 5,000 claims—valued at US$10.2M.

Finding the sweet spot

As our research showed, there are steps any organization can take to improve future-readiness:

  1. Know the ultimate goal: Think big and go beyond making incremental changes to operations. For instance, High Tech and Life Sciences/Biopharma are currently ahead of cross-industry standards in business-technology collaboration use at full scale and seem likely to maintain that lead over the next three years.
  2. Know the key steps: Automate at scale, augment human talent with technology and commit to data-driven decision making. For instance, our survey found that the percentage of Health organizations at widespread or full-scale automation usage has increased more than 23x over the past three years. While 84% of Insurance organizations say they design their operating model based on data rather than executive experience and intuition. And 73% of Life Sciences/Biopharma organizations have achieved widespread or full-scale data use today—that’s up more than 3x from three years ago.
  3. Know how to leapfrog maturity levels: Build ecosystem relationships with complementary skill sets and technologies on demand. For example, 66% of High Tech organizations and 60% of Automotive organizations have seen their ecosystem partnerships improve over the past three years. Accenture has shown how an ecosystem brings its own rewards—we built a shared services center for an insurance ecosystem that has increased the number of claims repairs sent to in-network suppliers by 40%.

In my experience, fast-tracking the journey to future-ready operations can become a true catalyst for competitive advantage. What’s more, by tackling the characteristics that are their weak spots, industries can elevate business decisions to realize their sweet spots—tangible, sustainable, transformational value and growth.

 

Manish Sharma

Group Chief Executive – Operations

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