What’s on the minds of senior business leaders as they begin 2013? Despite ongoing global economic uncertainty, and increasing competitive pressures, how will organisations approach the key issues of innovation and business viability in the short and medium term? ExEcutivE OutlOOk SurvEy 2013 Leading for innovation & growth To answer these questions, we decided to focus our annual survey of CEOs, Directors, Chairpersons and VPs across Asia-Pacific, the Americas and Europe on innovation and business viability. We asked 179 people in senior leadership positions to tell us about their company’s direction over the year ahead, and how they’re balancing the need to be profitable with the pressures of continuous change on a global scale.

1. Executive
Outlook 2013
report
Leading for
innovation
& growth

2. introduction
The findings of our annual C-suite culture was their key focus for the on implementing new technology it seems that after four-plus years
survey are in. This year, we spoke year. And, that for many, the main and creating new products. of global economic turmoil, many
with 179 executives in a broad barriers to innovation and agility leaders are again recognising that
range of industries across the globe. are those that are embedded within While this initially surprised us, it their employees’ attitudes are
We asked them about their views their organisational culture. also reminded us of the critical critical to business success. Pam Berklich
on innovation and how they plan nature of talent in an uncertain
to sustain growth amid ongoing In fact, C-suite executives appear economic environment. We know We are pleased to share the
economic uncertainty. to be just as focused on the that competitiveness is not just thoughts and insights of these
cultural aspects of organisational about great products and efficient business leaders in more detail
What they told us was that company innovation and change as they are processes—it’s about people. And throughout this report.
2

3. / Job titles of survey participants
46%
VP, Director
38%
CEO, MD,
Chairman
16%
EVP, SVP
about
the survey
/ Company size
6%
15% 5,000–10,000
More than employees 18%
10,000 250-999
employees employees
We conducted our annual Executive Responses were received from
Survey in January 2013, canvassing 179 executives in a wide range of
the views and opinions of senior industries, including:
leaders across the world on the • energy and utilities
topic of: Leading for innovation • oil and gas
23%
and sustaining growth. • healthcare 1,000–4,999
• bio-technology employees
We commissioned an on-line • banking/financial services
survey over a two-month period • property
from 15 November 2012, which • IT and communication 38%
targeted C-suite and senior • manufacturing Less than
250 employees
management executives only. • retail and FMCG
All responses were confidential
and have been aggregated.
3

4. Expect growth
this year
what 88%
they said
believe their competitive
position is unchallenged
11%
forecast Have a proactive
significant approach to
growth innovation
34% 42%
feel accountability
for growth is
too narrow
22% 4

5. most expect
to grow
this year
1% Significant decline
Despite the challenging business environment of 2012, Significant decline
4% Marginal decline 34% SignificantExpected revenue/business growth
/ growth
and the ongoing uncertainty on global markets, 88% of
Marginal decline
business leaders have change
7% No a positive outlook for the growth 1% Significant decline
S
of their business in 2013. 4% Marginal decline No change 33% Significant growth
M
Marginal growth
While most executives (55%) are expecting only marginal 7% No change
88 % N
growth this year, one-third (33%) is looking forward to Significant growth
‘significant’ growth within their organisation. Just seven 55% Marginal growth M
per cent of business leaders are expecting no change for positive
S
their organisation on this front, and a mere one per cent is
55% Marginal growth
anticipating a major decline.
Leaders in Asia-Pacific have higher expectations for business
performance this year than those in the Americas and Europe,
which is to be expected given the ongoing debate over debt / Outlook by Geographical Region
issues and constrained government spending in those regions.
4% 6% 3%
7% 5%
17%
22% 56%
55%
Significant decline
44%
34% Marginal decline
36% No change
11% Marginal growth
Significant growth
Americas/EMEA APAC ALL Americas/EMEA APAC
5

6. sustaining
growth
As you would expect, for many businesses (37%) profit-
/ Challenges for business longevity
generating and core-business activities are given priority over
longer-term investments to promote expansion and growth. 11% 37%
No challenges identified Profit-generating activities take priority
However, it appears that more than one in five business
leaders (22%) would like to see a greater focus on these 13%
‘growth’ initiatives, but believe this is stymied by a lack of Lack of understanding of
threats to sustainability
accountability for competitiveness further down the line in
their organisational hierarchies.
17% 22%
In fact, the majority of barriers to improving long-term business Organisation looks to quick fixes only Lack of individual accountablity/
prospects (52%) appear to be imbedded in the culture of the seen as the job of top management only
organisation: lack of accountability (22%); too great a focus on
short-term quick-fixes (17%); lack of knowledge required to
contribute to solutions (13%).
Businesses of all sizes seemed to be equally affected by these
cultural barriers to improving competitiveness. Whether from
large or small organisations, the same proportion of leaders
reported the concern that employees did not take individual
accountability for competitive longevity and instead saw this as
a job for top management only.
Just one in ten business leaders (11%) believes that their
competitive position is so strong that no challenges to it can
be seen on the horizon.
6

7. focus areas
to strengthen
competitiveness
Leaders appear to be acutely aware of the need to fully engage
/ sustainability factors that require integration
each and every employee in the task of maintaining and
improving business competitiveness over the long term. With
Organisation and employee 65%
two-thirds of leaders (65%) nominating this as a key focus area,
Product innovation 53%
it seems that 2013 will see a greater focus on individual training
and stronger communication of business-critical issues. Goals and policy 51%
Technology 48%
In fact, leaders are just as focused on the cultural aspects of
Education 27%
organisational innovation as they are on implementing new
technology and rolling out new products. It seems that the Environment 26%
race to remain competitive is seen not only as a product or
process issue, but as a human issue—and leaders know their
employees’ attitudes are critical to success.
Many leaders (53%) do nominate ‘product innovation’ as a key
focus area that will strengthen their business prospects over the
longer term, while the implementation of new technology is a
seen as a critical issue for 48% of leaders. However, winning in
the marketplace will also be dependent upon the alignment of
individual goals with those of the entire organisation, and this
is likely to create new pressures and opportunities for staff with
responsibilities for HR, communications, change management
and team leadership going forward.
7

8. promoting
innovation
Many leaders (42%) say they take a proactive approach / How the organisation approaches innovation
to innovation and have measureable goals and resources
1% Not sure
allocated to their initiatives. However, one-fifth (20%) says
core business activities remain their only focus, while 37%
20%
see incremental change as the way forward. We remain focused on our
core business activities only
The overall approach to innovation appears to be heavily
42%
influenced by the geographical reach of the organisation, We have measurable goals
and allocate resources for
and by whether or not it is operating in the private sector. innovation over the long term
37%
Global firms and multi-nationals are more likely to take a Our focus on incremental innovation
planned, proactive approach to innovation, while local
firms and those in the public or not-for-profit sectors were
less likely to do so. Public sector organisations and not-for-
profits remain firmly focused on core business activities only,
/ approaches to innovation by company type
with just one in five actively planning for—and allocating
resources to—innovation. 1% 3%
6% 12%
20% 20% 17%
47% 37%
37% 34%
50% Not sure
We remain focused on our
27% core business activities only
51% Our focus on incremental innovation
42% 46%
30% Have measurable goals & allocate
20% resources to protect long term
initiatives towards innovation
ALL Non-profit/ Global firm Multi-national Local
Government/ conglomerate
GLCs
8

9. barriers to
innovation
According to senior leaders, the main barriers to innovation
/ biggest hurdle to the implementation of innovation
appear to be those embedded within organisational cultures.
2%
While one-in-five leaders (20%) see legislative requirements as No time for innovation
a major barrier to innovation, three-in-ten (31%) say it is mainly 3%
Contracting issues
hampered by employees’ resistance to change, and a further 31%
15% feel that their organisation has a culture of risk aversion. 14% Resistance to change
Lack of funding/sponsorship
A lack of structure and process regarding funding,
15%
executive sponsorship and the requirements or business Lack of implementation/
performance criteria or business case
case for innovation initiatives does appear to be an issue
15% 20%
for a significant proportion of businesses, yet the key issue Risk aversion culture Stiff legal requirements
is undoubtedly cultural readiness for change across all
layers of organisations.
9

10. revenue outlook
and approach
to innovation
Of course, time will tell whether or not leaders’ revenue / revenue outlook 2013 by different segments toward innovation
predictions turn out to be accurate. However, it’s interesting
4% 3%
6% 9%
to note that those leading organisations with a structured, 7% 4%
5% 8%
proactive approach to innovation are far more positive
about their 2013 revenue outlook than those who focus only
43%
on core business activities, or who take an incremental 55%
59% 68%
approach to innovation.
Here, the difference is quite stark—45% of those with a Significant decline
Marginal decline
proactive approach are expecting significant growth in their
34% 45% 27% 23% No change
revenue this year, compared to just 23% of those who are Marginal growth
focusing their efforts entirely on core business activities. Significant growth
ALL Protecting long term Focus on Focused on
business innovation incremental core business
initiatives innovation activities only
100
80
60
40 10

11. conclusion
While most leaders are expecting some growth for their Yet, the biggest challenge for leaders seeking sustained
business in the year ahead, those located in the Asia- growth appears to be cultural readiness to change
Pacific region expressed more optimism than others. within organisational walls. Even after accounting for
Given economic factors outside organisations’ control, the different regulatory requirements and industry
this result is hardly surprising. Likewise, larger global dynamics that undoubtedly shape an organisation’s
firms and multi-nationals were more confident about approach to innovation, leaders are clearly saying that
their outlook than local organisations—perhaps due employee populations are resistant to change.
to their ability to leverage multi-country markets and
Cultural change seems to be the focus of leaders
spread risk more favourably.
across the world as they look for new ways forward in
What stands out from the research is that those an uncertain and increasingly competitive global
organisations with the greatest positivity going into market. While many see that processes and products
2013 are those with a proactive approach to innovation. need to adapt to meet demand, leaders see their own
They see significant opportunities to innovate product people as both the key, and a potential barrier, to
lines and to ensure processes are more efficient. achieving this.
11

12. About Access
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Visit www.bticonsultants.com
About KellyOCG
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Inc. KellyOCG is a global leader in innovative talent management solutions in the areas of Recruitment Process
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