Addresses top negative and positive trends expected in the market over the coming one to two years.
KPMG released via a webcast the results of its 4Q18 Global Insights Pulse survey. These Pulse surveys are quarterly reviews of global business and market trends in the areas of intelligent automation, service delivery and operating models, and advanced technologies. Key focus areas include global business services (GBS), cloud, and the use of intelligent automation technologies. The learnings are gleaned from KPMG member firms’ consultants globally, who are working closely with end-user organizations that are actively exploring or undertaking these initiatives, along with surveys of end-user organization executives globally. The fourth-quarter Pulse survey annually focuses on top trends and predictions for the coming one to two years. This first blog of a series will address top negative and positive trends expected in the market over the coming one to two years.
Results from these annual “top trends” Pulse surveys consistently correlates between perceived negative and positive trends. It is also key to remember that whether a trend is negative or positive is often in the eye of the beholder. For example, trade protectionism, deglobalization, and economic populism is the second-ranked top negative trend this year but if a firm is insulated from lower-cost foreign competition, for example, U.S. steel firms as a result of Trump administration tariffs, it is a positive trend.
Similarly, the pervasive cited negative trend of talent shortages and talent management challenges, the top cited negative trend over the past three years, correlates with the top cited positive trend (see Figure 2) of positive impact of intelligent automation/digital labor. If talent and skills shortages increase due to changing demographics, antiquated employee skill sets, and weak education systems, the emphasis on replacing human with digital labor will only grow faster than it would if its main driver was to just cut costs. Additionally, while there is great angst in the market over the potential for large-scale job elimination due to process automation, this is at least partially offset by the fact many jobs and roles would remain unfilled due to skilled labor shortages.
Figure 1 – from Pulse webcast
Figure 2 –from Pulse webcast
So while there are many headwinds facing most, but not all, organizations in 2019 and beyond (e.g., protectionism and nationalism, excessive/burdensome regulation, political gridlock, Brexit [for a segment of the market]), they are often offset by positive trends (e.g., maturation of/greater access to innovative technologies, improving consumer/customer demand, expanding emerging market opportunities for selling goods/services, improving/rebounding global economic conditions) that gain momentum as more organizations address the challenges they face with more focus.
Organizations must identify and prioritize the key challenges, or negative trends, most likely to impact their operations and strategic initiatives in 2019 and beyond. Equally important is to understand how emerging, or increasing in importance, positive trends can both help to address these challenges and afford the opportunity to accelerate strategic initiatives to springboard against the competition. While in some cases a negative trend or challenge is just that, negative, in others it is an impetus to accelerate efforts to capitalize on positive trends and opportunities in the market.
Visit KPMG’s Advice Worth Keeping podcast site and series to hear more on top trends and predictions for 2019 and beyond from various KPMG executives and subject matter professionals.