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How to transform from market leader to market maker?

A renewed focus on humans, technology and innovation, and an approach anchored on long-term value, is key to successful transformation.

It would have been hard to believe, on 1 January, that only a few months later, we would be defining this new decade in terms of pre-pandemic, pandemic and post-pandemic.

Pre-pandemic, global capital markets were reaching record highs, commodity markets were stable, and consumers were playing a key role in maintaining economic growth with weekend getaways, retail shopping and eating out. As the pandemic took hold, markets fell, people around the world stayed home, global economies slowed significantly and the IMF forecast global GDP declines greater than the 2008 financial crisis.

Now, as stay-at-home restrictions ease and economies reopen, a new reality is emerging. Nearly two-thirds of consumers surveyed in EY’s Future Consumer Index say they will be spending less on vacations, leisure, clothing and big-ticket items in the immediate future. In the months ahead, 52% expect to change the way they shop and 41% say they will change the products they buy.

These shifting consumer behaviors suggest companies slow to change will have to rapidly and fundamentally transform their businesses to survive. For a select few, such as technology companies, communication software providers, home entertainment, social-media companies and e-tailers, it has been an opportunity to excel with their agility to shift business models and address emerging consumer needs. Whether companies are looking to survive or thrive, transformation is no longer optional — it’s essential.

The imperative to transform pre-dated the pandemic, with nearly three-quarters of C-suite respondents surveyed in February for the EY Global Capital Confidence Barometer saying their company was in the midst of a significant business and technology transformation program. Among their reasons were pressure to meet profitability goals, increasing pressure from shareholders and difficulty attracting and retaining new customers.


of C-suite executives said pre-pandemic their company was in the midst of a significant business and technology transformation program.


Although some companies were pressing pause on their transformation programs, executives were signalling the pandemic would soon serve as a transformation accelerator, particularly around global supply chains, digital transformation, automation and workforce management.

Today, we believe successful companies need to go beyond being market leaders to become market makers. They must look for opportunities to transcend boundaries, generate sustainable growth and consider new measures for long-term value in ways that span customers, employees and society, as well as financials. They must embody a transformative mindset that unlocks human potential, orchestrates engagement, leverages the speed of technology and ignites innovation.

Companies must look for opportunities to go from market leaders to market makers.

Post-pandemic, investors will be looking for purpose and long-term value creation

In the past, value was defined by profit and loss through consistent quarterly earnings and stock valuations, short-term profit goals, market-share growth and stock repurchases. More recently, corporations have been questioning value definition, as well as the overall purpose of a business. They’ve been shifting from being focused purely on shareholders and toward a broader focus on stakeholders.

The Embankment Project for Inclusive Capitalism (EPIC) (pdf) brought leaders from across businesses, including asset creators, asset managers and asset owners together to define how to better measure long-term performance for customers, employees, society and financial stakeholders. Notably, environmental, social and governance (ESG)-focused investors are seeing greater returns even during the pandemic, with the S&P 500 ESG index outperforming the non-ESG index by 3% in the last-twelve months.1

Looking ahead, there is consensus the pandemic will help catalyze the reshaping of businesses and how they are valued. Investors will look not only for companies that have demonstrated resilience and are disruption-ready, but also to those that have aligned their purpose to long-term value creation.

This is the future — a “beyond” that is exponentially hurtling toward now.

In reframing their future, companies should anchor on new transformative drivers

Achieving these objectives requires companies to transform using three new drivers that put humans at center, deploy technology at speed and innovate at scale. Research in EY’s Six habits of digital transformation leaders indicates transformational leaders are 45% more likely to unlock annual revenue growth of more than 10% and are 50% more likely to see EBITDA increase annually by more than 15%.

Six habits of digital transformation leaders:


of transformational leaders are more likely to unlock annual revenue growth of more than 10%.

Six habits of digital transformation leaders


of transformational leaders are more likely to see EBITDA increase annually by more than 15%.

In a recent EY article and in EYQ’s new Megatrends 2020 report, our analysis highlights the importance of taking a future-back approach when embarking upon — or accelerating — a transformation journey. It’s a process that involves looking ahead and envisioning multiple future scenarios, and then creating a multi-horizon strategic map that walks the future back to today.

These future scenarios present the opportunity for organizations to reframe their future to capture new growth and establish new business models that can deliver short-term and long-term value.  Below are four questions every organization should ask itself to spur transformation and reinvention.

1. How do companies create customer intimacy without proximity?

Although consumer responses in the EY Future Consumer Index suggest substantial behavioral shifts, it’s more likely what we’re seeing is the acceleration of a trend at least two decades in the making. Pre-pandemic, many companies weren’t meeting rising customer expectations because they were competing against the small minority of companies who redefined the customer experience and continue to evolve their product or service offerings to personalize, predict and adapt. For those who have fallen behind, the pandemic — and the market shifts it has accelerated — has leveled the playing field.

In the post-pandemic era, companies setting a new benchmark will create customer intimacy through hyper-personalization, predicting what customers want and adapting products or services based on their specific environment without a single face-to-face. EY survey results in Six habits of digital transformation leaders suggest leaders who are laser-focused on their customers do a better job at meeting customer demands and meeting profitability goals.

But that requires trust. While customers are increasingly signalling they are willing to provide more data, they need faith in the organization — or government — they are giving it to. Nearly three-quarters of UK consumers and two-thirds of US consumers in a global ESOMAR and HERE Technologies study indicate a willingness to share personal data, provided companies are transparent about their data collection practices.

2. Where does employee centricity meet the future of work?

One of the lessons companies have learned from the pandemic crisis is how central employees are to every dimension of the enterprise. They activate the assets, tools and technologies, and serve and delight customers.

Our experience suggests companies that keep employees at the center of their resiliency efforts, purpose and decision-making will accelerate their recovery. It also helps them to find opportunities as they consider what lies beyond the pandemic. For many companies, it’s time to reimagine the digital workforce experience — nearly two-thirds of executives polled in a recent EY webcast on the future of work said they expect a physical return to work with a longer-term transformation ahead. In the physical work environment, a new world awaits as organizations consider real-estate decisions in the context of employee safety and wellbeing. For companies struggling with either too much or too little capacity in their talent pools, future opportunities may include talent sharing across the organization’s broader ecosystem. Emerging technologies can play a key role in filling the skills gap companies were experiencing even before the pandemic, from gamification to on-demand learning.

Our experience suggests companies that keep employees at the center of their resiliency efforts, purpose and decision-making will accelerate their recovery.

3. How can technology at speed create competitive advantage?

The pandemic highlighted many organizations were overestimating their digital maturity, while underestimating the critical and urgent need for digital transformation. In EY’s Tech Horizons survey, we determined almost every company was already on a journey to digitally transform its business; however, only 4% said transformation was fully embedded and optimized across their operations. Post-pandemic, companies wanting to be digital transformation leaders will need to exhibit six habits: put customers first, accelerate AI to drive growth, promote innovation through ecosystems and partnerships, nurture talent with new incentives and strategies, activate governance plans for emerging technology, and use data and agility to power innovation.

At the same time, with a much larger workforce at home, companies will have to contend with an exponential rise in cybersecurity risks. Even before the pandemic, 59% of executives in EY’s Global Information Security Survey (pdf) said their organization had faced a material or significant incident in the past 12 months. During the pandemic, the media has reported an escalation in incidents as hackers take advantage of organizations focused on addressing the crisis — from hospitals and health care providers, to law firms. Looking beyond, cybersecurity will have to be embedded into every transformation journey — as will privacy protections, for customers and employees.

4. Where does innovation at scale meet the new “S-curve” of growth?

Since World War II, the global economy has been following an extended S-curve of growth — a pattern of growth in which a disruptive concept, technology or market starts with low adoption initially, followed by dramatic growth before slowing again as the model matures. Following the S-curve, global companies used the traditional value drivers of scope, scale and efficiency to measure performance and value. Companies that accelerated out of previous global shifts — US auto manufacturers post-World War II and hypergrowth “unicorn” companies post-financial crisis — have shaped the world we live in today.

Post-pandemic, we expect a new generation of leaders will emerge, operating by the rules of a new non-linear S-curve, where innovation timelines compress and ideation, prototyping, piloting and commercialization happen on parallel tracks. Examples of companies already experimenting with the new S-curve include a household appliance maker developing and commercializing a new ventilator in 30 days, distillers shifting from making spirits to making hand sanitizer, and pharmaceutical companies going directly from COVID-19 vaccine research to human clinical trials. Innovating at scale along this new growth trajectory requires companies reinvent their operations to be data-driven, support hyper personalization, rapidly orchestrate ecosystems of value and address the reshaping of globalization.

To innovate at scale, companies will have to reinvent their operations to be data-driven, support hyper personalization, rapidly orchestrate ecosystems of value and address the reshaping of globalization.

For transformative leaders, the pandemic will serve as the great accelerator to long-term value creation

If there is anything this pandemic has taught us, it’s how important humans are to businesses and the economy. Without humans, everything comes to a grinding halt. It’s why long-term value performance increasingly needs to be predicated beyond the financials to incorporate the human factors — customers, employees, society.

Companies effectively anchoring their transformation approach to long-term value and propelling it with the three transformative drivers – humans, technology and innovation – have an opportunity to accelerate growth in a post-pandemic world, regardless of which shape it takes. Those failing to embrace the need to rapidly transform will likely accelerate into obscurity.

By Amy Brachio, Dan Higgens and Michael Bertolino - EY

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