Customer demands and the rise in technology are quickly forcing businesses to change the way they operate, new research shows.
A study by audit, tax and advisory firm KPMG LLP discovered that increasing and more sophisticated customer demands, such as wanting more mobile options and improved access to customer service, are forcing companies to adopt new business models and deploy advanced technologies to help improve productivity.
Specifically, 33 percent of the businesses surveyed said customer demands represented the most common trigger for transforming their business model, while 30 percent said technology was the impetus for changing their business model.
Stephen Hasty, a KPMG partner and U.S. innovation leader for advisory, said that with the changing customer dynamic, business leaders want the most strategic technologies to better manage the back office and the broader workforce in order to boost the bottom line.
"Technology that is geared to help drive performance in support of a customer-centric focus is taking center stage," Hasty said. "In fact, more and more company leaders see that emerging IT advancements can drive business improvements to help them grow their business and maintain a competitive posture in the market, even amid rising costs for raw materials and narrowing margins for products."
Those surveyed pointed to a number of new and emerging technologies that they believe are critical to the success of the strategic initiatives they planned for the next 18 months, including data, analytics and business process management tools; mobile and core system modernization; digital media; and the cloud.
Stephen Chase, KPMG's service line leader for technology, said transformation entails aligning and servicing the customer, optimizing the supply chain, and managing risk and tax issues, as well as having a better view of the financials and an improved strategic oversight of the workforce.
"Recent economic events underscored for many executives that transparency and agility have become increasingly important for businesses to predict and anticipate customer, competitive and market changes," Chase said. "Put simply, companies need to continually transform their organization's business model, using new and emerging technologies to help manage performance and cut costs."
The research found that more than 60 percent of the companies that are getting ready for, are undergoing or have completed transformations have a formal process for prioritizing business transformation initiatives.
"Undertaking broad changes to a business operating model — covering everything from the financial, risk and tax transformation to human capital management, acquisitions and target markets — can create an operation that is innovative, agile, responsive to change, and focused on customers to get ahead of competitors and the marketplace," Hasty said. "Technology opens up the possibilities — and pitfalls — of cloud environments, social media interaction, data and analytics, and wide-scale mobility, creating entirely new industries and enterprises at the same time that they redefine how existing businesses operate and influence consumer choices."
The study was based on surveys of more than 900 U.S.-based multinational companies and asset management firms. The results are part of a larger KPMG report on transformation planned for a fall release.
Originally published on BusinessNewsDaily.