Innovation is regarded as the Holy Grail for today’s service providers. But being able to turn good ideas into value for end users in a fast-moving industry is tough. Even tougher when you have a complex operational and systems environment – built over years to support millions of customers and multiple lines of business – and you find yourself competing with agile new entrants with much simpler business propositions. Combine all of this with ongoing regulatory changes, and consolidating mega players threatening to take a bite out of your market share, and the challenges facing the leadership team become starkly defined.
Most especially, CEOs are in the spotlight to successfully steer their organisations through significant transformation to stay ahead of the competition and profitably grow the business. If these are the challenges CEOs face today, what can they expect in 2020? More specifically, what leadership styles, qualities, skills and approaches will successful CEOs need to possess to take their companies into the next decade?
These were the questions that a new global study – commissioned by Amdocs with strategy consultancy Telesperience – sought to answer. In-depth interviews with CEOs, C-suite and other senior management executives at the world’s top-tier service providers, including some of the largest in Europe, provided insights that uncovered views and forecasts for how CEOs will be running their organisations in 2020.
Fast-forward to 2020 and what makes CEOs in Europe perform well today will not be the recipe for future needs
Management styles are changing
The typical CEO has worked in different countries, and even regions, and has held at least three different roles at their current company. But professional diversity may not be enough to be effective in 2020. The survey found that in Europe, 100 percent of the respondents who expressed an opinion believe current CEO management styles need to change for them to remain successful five years from now.
Fast-forward to 2020 and what makes CEOs in Europe perform well today will not be the recipe for future needs. The local industry believes collaborative styles will be needed to allow service providers to scale into the future. This means moving away from today’s favoured styles of visionary and pacesetting – in which the CEO is expected to know where the company is going and lead it there by example – to coaching and affiliative styles, which value the contribution of teamwork to end goals.
The majority of the executives who took part in the survey (64 percent) also believe CEOs of European service providers should be driven in 2020 by a passion for innovation, and would provide the most value to the organisation through ideas and strategy (first) and innovation (second), ahead of financial governance (third), good corporate governance (seventh) and good operational management (ninth).
The changing face of C-suites
In Europe it’s not just the CEO leadership style that will change. New areas of focus and lines of business are already opening new C-level opportunities. Respondents cited that today the most commonly added roles hold responsibility for commercial activities (first) and customer experience, digital and people (tied second). Executives predicted that in 2020, the most commonly added role will still be for customer experience (first), followed by big data (second), digital (third) and cloud (fourth).
Today’s C-suite team is likely to be the breeding ground for future CEOs. So it’s interesting that 64 percent of senior executives in Europe believe that the CEO in 2020 will most likely come from a CFO background, implying that the former is expected to drive innovation while keeping the numbers right.
Innovate while minimising expense and risk barriers
The top barriers to Europe’s CEO success by 2020 will be “no clear strategy” (first) and “lack of resources” (second), ahead of lack of ideas (third), and with competition a distant ninth. Reinforcing the need to overcome the challenge of executing on innovative ideas, executives in Europe believe that by 2020, the most important innovation skill the future CEO will have is the ability to create organisational structures that support innovation and change.
So it’s unsurprising that the region’s senior executives plan to invest in outsourcing strategies to supplement internal resources in support of innovation investment imperatives. In 2020, CEOs in Europe are most likely to invest in:
- customer experience – first place; and
- cloud services and networks – tied second place.
To drive change it is believed that a blended approach of both outsourcing and insourcing will be required. For example, more than half are expected to outsource at least some support for cloud services (82 percent) and digital services (64 percent).
2020 is very much in the near future and this study suggests that the current generation of senior executives are already pondering their needs for continued industry leadership. Expecting to be challenged in 2020 with turning good ideas into concrete results quickly, service providers in Europe believe CEOs will require a variety of skills and a collaborative approach to innovation and business. They will need to plan to turn to external expertise and resources, such as professional services and outsourcing vendors, as a way to break innovation bottlenecks.
Delivering The New World of Customer Experience in a consolidating market
In what has been termed ‘The New World of Customer Experience’, customers expect to be inspired and excited by a constant drum of new services, delivered in an intelligent manner through personalisation and contextualisation, and shaped by a dynamic quality of experience (QoE) regardless of device or network. And all this needs to be accomplished in a manner that accelerates business value for the service provider, speeding up time-to-market, optimising business processes and reducing costs. As players continue to consolidate, innovation is increasingly challenged by back-end system complexity, impacting service providers’ ability to deliver on customer expectations.
Professional and managed services vendors that offer innovative IT and business services which deliver business value, drive immediate operational improvements without lengthy software integration, together with global best practices and a worldwide 24/7 support model, can help these large companies move as fast as they need – while ensuring an efficient cost structure. This type of partnership enables service providers to gain advantages from best practices accumulated from projects around the world, enabling them to achieve the desired results faster with less risk. With a joint commitment to reach business objectives, service providers can rely on such partnerships to ensure business growth.