CEOs say their priorities and concerns have changed significantly in the wake of the coronavirus outbreak, according to the KPMG 2020 U.S. CEO Outlook, an annual survey that focuses this year on how leaders and their organizations are managing in the new reality.
The result indicate that the pandemic has rapidly accelerated change in two critical areas – the development of the future workforce and the digital transformation of organizations.
Talent and new ways of working take a seat front and center
Even in the midst of a pandemic, CEOs are also not taking their eye off the future of work. In fact, COVID-19 has effectively forced many organizations to experiment radically with how work is done. For many organizations, for example, virtual working kicked in literally overnight and has taken up permanent residence for many. With the pandemic transforming the world of work, 76 percent say they will continue to build on their current use of digital collaboration and communication tools, and 73 percent believe that remote working has widened their available talent pool. Furthermore, 78 percent of CEOs said the need for remote working has prompted their organizations to make significant changes to their policies to nurture their culture.
As they look to accelerate digital innovation, CEOs are also acutely aware of the people who have to deliver – their employees. Many employees are grappling with significant anxiety – or even fear – about today’s situation and what the future holds and have also had to embrace very different ways of working. While ‘talent risk’ was the threat that CEOs was ranked behind 11 other risks at the beginning of the year, it has now risen to be the number one threat to long-term growth, with CEOs recognizing the need to keep their people feeling safe but also connected, engaged and productive. At the same time, 72% say the ability to hire from a remote workforce has widened the potential talent pool.
Digital transformation of organizations
The majority of U.S. CEOs say the pandemic has rapidly accelerated their organizations’ digital transformation efforts. “The benefits will be permanent,” says Carl Carande, Vice Chair – Advisory, KPMG U.S. “There will be no going back.”
In terms of the impact of the pandemic, 66 percent of CEOs say that progress in the creation of a new workforce model – with human workers augmented by automation and artificial intelligence – has accelerated by a matter of months or years as a result.
At the beginning of the year, 67% of U.S. CEOs expressed concerns about migrating all of their business to the cloud. By forcing the embrace of digital technologies, the pandemic has largely erased previous hesitation. A large majority of CEOs say the pandemic has accelerated the creation of a seamless customer experience (75%) and new business models and revenue streams (70%).
Accelerated demand for digital technology solutions has been a boon for many companies, though many cited talent-related challenges: 31% said the top challenge was difficulty making quick technology related decisions, while 17% cited a lack of skills and capabilities in the IT organization.
The exponential digital acceleration to enable the remote workforce is likely further exacerbating talent risk by causing even greater shortages of digital and change management professionals. To respond, organization need to design learning programs around digital education and offer continuous training for employees to prepare for the new workforce model that lies ahead.
CEOs recognize that recovery from the pandemic does not mean a return to ‘normal’. Instead, there is an opportunity to define a new future, and three actions areas will be critical: sustainability, digital and trust. For all of those to take hold, employees are increasingly going to expect to know what’s happening at their companies and be in regular communication their CEO.