The study from Monitor Deloitte also finds a convergence between technology and strategy and the increased focus on corporate purpose as a strategic mandate.
Eighty-four percent of chief strategy officers surveyed agree that advanced technologies such as intelligent automation, predictive analytics, artificial intelligence and machine learning, as well as virtual, augmented and mixed reality will play an increased role as strategic enablers for their businesses, a new study finds.
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“These technologies will unlock a significant change in human productivity, drive new growth opportunities with a greater level of precision, enable new channels to market, and make new business models viable, according to Deloitte’s third annual Chief Strategy Officer Survey.
However, the study found that nearly half of CSOs surveyed said their company lacks the mature skills required to leverage advanced technologies. Some of the key challenges cited were:
- a missing explicit link between technology strategy and business strategy (42%),
- a lack of alignment on priority use cases and how investments in advanced technology will create business value (34%)
- a lack of vision for how investments in advanced technology will scale beyond localized proofs-of-concept (30%), according to the survey.
Those are three critical roles in which CSOs are extremely well-positioned, Deloitte said.
The convergence of technology and enterprise strategy
CSOs have a strong desire to play more prominent roles in developing their organizations’ advanced technology strategy. Fifty-two percent are involved in defining and executing their companies’ strategy toward advanced technologies (up from 47% in the 2021 survey), and 88% of respondents would like to play an even more central role in this process.
The survey found that CSOs believe they can make the biggest impact on their organizations’ advanced technology strategies in a few key areas: explicitly linking technology and business strategy (84%), estimating and tracking value creation (67%); directing and managing investments (66%), and defining priority use cases (64%).
What CSOs should do
The study advised CSOs to continue adapting their roles with agility in response to the rapidly changing COVID-19 environment. They should incubate for the future, operate more ambidextrously and strike a balance between protecting their core business while investing in long-term growth, according to the Deloitte study.
Additionally, 88% of CSOs said they want to play a more central role in determining their company’s advanced technology strategy, and 73% of CSOs agree that purpose strategy is a priority for the C-suite.
To play a more central role in helping their organizations evolve their advanced technology strategies and bridge the gap, Deloitte advised that they:
- Strengthen their tech fluency
- Build out the “architect” role of linking technology and enterprise strategy
- Embrace the “orchestrator” role of harmonizing technology-driven changes in the business.
CSOs are optimistic about growth
CSOs are generally optimistic about their organizations’ opportunities for growth, and the survey found that 80% of CSOs expect an increase in revenue, profit or both over the next 12 months, according to the study.
Additionally, they are optimistic about how their industries will fare (64%), how their companies will perform (77%), and their own ability to make an impact (81%). With the challenges of the last two years, it’s not surprising that CSOs remain cautious about the external environment, with only 40% of CSOs reporting to be optimistic about the future of the global economy, the study noted.
Over the past 12 months, CSOs have spent time investing in and growing their core businesses. Core offerings represented 66% of total investment in 2021 but are expected to fall to 50% due to an anticipated rise in adjacent and transformational investments in 2022.
The survey also found that CSOs are ready to seed more growth opportunities, and they believe that the share of investment dedicated to new areas of opportunity will grow from 34% today to close to 50% in the future.
Corporate strategy with purpose
Corporate purpose is becoming an integral part of the CSO mandate, and 73% of CSOs agreed that purpose is a priority for the C-suite. Companies are making strides in defining and advancing their purpose strategies and integrating them with the business strategy, according to the survey.
Some 77% of CSOs agree that their organizations have a clearly defined purpose strategy, 77% agree that the primary focus of their purpose strategy is to create value, and 78% agreed that their purpose strategy is well integrated with their core enterprise strategy, the study found.
However, there is room for improvement when it comes to measuring the impact of purpose efforts and communicating the value to stakeholders. Only 20% of CSOs said they strongly believe their companies make it a priority to collect and report on purpose-related data, and only one-third of respondents strongly believe that their companies clearly and consistently articulate their purpose strategy internally and externally, according to the study.
Monitor Deloitte, the strategy practice of Deloitte Consulting, surveyed 230 senior strategy executives from 35 countries globally, representing organizations of different sizes and ownership structures across various industries, the company said.