BOSTON—The fundamental drivers of superior performance and sustainable competitive advantage are changing. Growth opportunities are moving to new markets, including those created by technology disruption, and are expanding in areas related to generative artificial intelligence (AI), the energy transition and low-emission technology as well as in gene therapy, the metaverse, and quantum computing.
Many incumbents struggle to justify investments in these disruptive new opportunities or find themselves tied up in wasteful IT spending programs; some 70% of CEOs say that their company does not prioritize its investments well in executing digital transformation programs. Since they lack the capabilities required to access the new markets and gain advantage with AI and other technologies, their futures look bleak. However, a few companies are built for the future, generating shareholder returns almost three times greater than those of the S&P 1200, with two-thirds of the value created coming from revenue growth. New insights published today by Boston Consulting Group (BCG), titled “Build for the Future: The New Blueprint for Corporate Performance,” highlight the common set of six attributes these winning organizations share, regardless of sector, that enable them to exhibit superior performance, be more resilient to shocks and disruptions, and exploit innovation faster for value-creating growth.
The Six Attributes of Companies Built for the Future
Six attributes enable built-for-the-future companies to move into new high-growth markets that are beyond the reach of less capable players:
“A small number of companies have built winning capabilities and broken away from the pack,” said Amanda Luther, a managing director and partner at BCG and a coauthor of the article. “They have avoided the trap of overfunded, underdelivered IT projects. Instead, they have made smart investments in people, processes, and culture, underpinned by strategic technology builds that have delivered outsized value.”
BCG surveyed 725 C-suite members to understand how their companies are building (or have built) more than 50 different capabilities in five areas that previous research has shown are fundamental to success: senior management commitment, strategy and approach, governance, people, and technology.
The authors then analyzed which of these capabilities contribute most to an organization’s future readiness. BCG can link future readiness to financial and nonfinancial metrics that investors and other shareholders value, such as shareholder returns, growth in earnings before interest and taxes, customer satisfaction, and talent attraction. The authors scored each surveyed company on its position along the journey toward becoming future built and identified four groups of companies on the basis of their progress: stagnating, emerging, scaling, and future built.
Four Types of Companies and Where They Are on the Journey to Being Built for the Future
The more advanced companies (scalers and future-built firms) are opening big chasms with the stagnating and emerging companies in critical capabilities that cement advantage. For example:
BCG’s empirically derived insights offer a practical playbook that guides companies to both improve near-term performance and build the necessary capabilities for sustained advantage.
“Companies need to decide on the business outcomes they seek and the specific use cases they need to build,” said Romain de Laubier, a managing director and partner at BCG and a coauthor of the article. “They also need to determine the minimum viable foundations of technology and data that will enable them to scale solutions. Advanced companies are doing this and incorporating a continuous improvement agenda with new initiatives that leverage the progress they have already made.”
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