6 Ways for CEOs to Leverage Digital Disruption

Automation and digitization are transforming every industry today, leading more CEOs to look at technology as the biggest external force influencing their enterprises. This sea change also calls for business leaders to be increasingly proactive about disrupting their own companies before it’s done for them.

One-third of the top 20 companies in every industry will be “disrupted” over the next three years, according IT consultants IDC. This means their revenues, profits and market position will deteriorate, reported The New York Times. New reports by Gartner and Forrester also insist that the pace of digital innovation—via cloud computing, mobile devices, advanced data analysis and other manifestations—is accelerating and broadening.

“Mainstream companies in every industry are realizing they’ll be disrupted if they don’t get moving now,” Frank Gens, chief analyst for IDC and main author of its report, told the Times.

The percentage of C-suite leaders who expect to contend with competition from outside their industry—most of it fueled by digital transformation—rose to 54% in a recent IBM study, up from 43% just two years ago. They see such disruptions as a primary force that will affect their companies over the next 3-5 years.

“Mainstream companies in every industry are realizing they’ll be disrupted if they don’t get moving now.”

What are CEOs and other C-suite leaders to do? Here are 6 ideas digested from recommendations by IBM and IDC.

  1. Set up strong executive leadership with digital experience who can help with the ramp up, including a chief digital officer, a tech-savvy COO, and/or a market-savvy CIO—to achieve a balance between encouraging rapid, distributed innovation and the growing need for governance and integration of digital initiatives, IDC advised.
  1. Prioritize recruitment of talented developers, preferably with domain knowledge of your marketplace, as a top 3-to-5 strategy in 2016 and beyond, the consulting firm suggested.
  1. Consider establishing a dedicated “digital business” unit to allow the enterprise to quickly reach a critical mass of digital innovation capacity—at least as a short-term strategy, IDC said.
  1. Bring innovation from outside sources into the company, as 54% of C-suite executives surveyed by IBM plan to do. And 705 plan to expand their partner network.
  1. Utilize customer feedback to help identify and explore new trends and technologies, a priority identified by 60% of CEOs who were surveyed by IBM two years ago. But only half of respondents in the latest survey said they’re doing this. Directly engaging customers and proactively applying what they learned to set their business agendas is “still a gap waiting to be closed,” the digital giant said.
  1. Change how your company engages with customers. In the IBM survey, 66% of C-suite executives expected to focus more on customers as individuals, up by 22% from 2013, and 81% planned to drive more digital interaction, a 19% increase from two years ago.

These steps will help CEOs not only stay ahead of disruption, but perhaps lead it, acting as change agents in their own and others’ industries. It’s always best to set the agenda, especially in an area moving as quickly as digital transformation.


  • Get the CEO Briefing

    Sign up today to get weekly access to the latest issues affecting CEOs in every industry
  • upcoming events