Mid-market Executives View U.S. as Less Accommodating to Entrepreneurialism
High levels of economic uncertainty are affecting business and shifting opinions among mid-market executives, according to findings in Deloitte’s "Mid-market perspectives: America’s economic engine- why entrepreneurs matter." Specifically, only 59 percent of executives surveyed ranked the United States as the most accommodating country for entrepreneurs - a 32 percent drop from how those same executives said they felt in past years.
Moreover, while 35 percent of mid-market executives claim their own organization has grown more entrepreneurial, 15 percent state their company is less entrepreneurial, despite the clear benefits in terms of greater productivity and profit margins. Among respondents who did not choose the U.S. as the most attractive environment for entrepreneurs, 42 percent selected China, followed by India (26 percent), Brazil (21 percent) and Australia (18 percent) as most accommodating.
In defining “entrepreneurial”, 81 percent of respondents say any company, large or small, can behave in entrepreneurial ways. Mid-market executives say that being creative, unique, different, innovative and taking risks with the acceptance of failure are most important for keeping their companies successful.
Among mid-market executives who indicated their companies had become more entrepreneurial, they cited innovation to create entirely new businesses, enhancing products and services, and discovering and penetrating new markets as primary behaviors driving their organizations.
Mid-market executives citing a decline in entrepreneurialism attributed it to C-suite leaders’ desire to be risk-averse (36 percent) while 17 percent expressed their desire to avoid volatility by sticking to tried and true business practices.
Entrepreneurialism as a Catalyst for Growth
Overall, the survey shows entrepreneurial companies are succeeding at a faster pace in the marketplace.
Compared to all survey respondents, those who identified their companies as more entrepreneurial are more likely to have:
Nearly one-third (30 percent) of mid-market executives were more likely to cite ongoing investment in technology and people as a driver of success.
The Bigger Economic Picture
Companies that have become more entrepreneurial are likely to have increased their workforce by more than 10 percent during the past year, and plan for the same in the year to come. Additionally, this segment of survey respondents expect their revenue to grow by more than 10 percent next year.
Uncertainty, however, has not diminished. In fact, the survey shows consistent increases in the level of uncertainty, particularly in an election year in which fiscal policy, taxes and regulation hang in the balance.
Survey Reveals Shift in Customer Service Preferences
Angel, a provider of cloud-based Customer Experience Management (CEM) solutions, released the findings from a survey of over 650 attendees at the 2012 Dreamforce event in San Francisco. The survey results show an evolution of customer service preferences, with more customers expecting businesses to better anticipate customer needs and provide more personalized and on-demand customer service across any channel and device.
The results demonstrated a significant shift to web and mobile technologies as the preferred ways to connect with customer service. From these results, there is an opportunity for companies to better anticipate the change of customer preferences and begin providing multichannel customer support to quickly resolve problems, improve the customer experience and increase customer satisfaction.
Shift in platforms – While 51 percent of the respondents named landline telephone customer support as the most preferred customer service channel five years ago, 34 percent called out email as their top resource today, followed by landline telephone (19 percent) and mobile devices (16 percent).
Mobile customer support quickly gaining – In the next five years, 24 percent expect mobile devices to be the leading customer service channel while 41 percent confirmed they have downloaded a mobile application to better connect to customer service.
Online self-service tools are critical – Currently, 63 percent turn to the company website as their first channel of choice to resolve an issue before calling customer service.
Customer service is an ongoing experience – 26 percent said they are likely to tell their friends about their experience, 21 percent said they would ask for the same representative next time and 14 percent said they would share their experience online.
Additional survey findings revealed what companies customers spend the most time with as well as how customers would like to interact with customer service:
Banking and retail organizations spend the most time with their customers – these are the leading industries for which customers said they spend the most time on a customer service issue, with 24 percent and 20 percent, respectively.
Convenience is important – 47 percent said they usually connect with customer service from work and 33 percent reach out while at home.
On-demand support expectations are significant – 18 percent said instant messaging is their first channel of choice to resolve an issue, while five percent said they turn to social networks to resolve customer service problems.
Following these results, some key customer care recommendations include:
Provide multichannel support – Customers are turning to multiple channels to resolve their customer service issues, including email, mobile devices, instant message and text messages. Offering cloud-based customer service support for as many channels as possible can ensure issues are immediately resolved.
Anticipate customer needs – With 18 percent of respondents naming mind-reading as the second most preferred way to connect with customer service in five years, there is an opportunity for businesses to leverage analytics to identify past customer trends, better allocate customer service resources and incorporate the features to ensure each customer has a positive experience.
Personalize the experience – Identify how and where the customer base usually interacts with the business throughout the entire lifecycle and provide the support and tools that enable customers to immediately resolve their unique problems as well as quickly connect with the organization.
Research Reveals Major Fault Line Separating the Board Room, Marketing Suite, and Contact Center Threatens Customer Experience
New research reveals critical areas where organizations are falling short in addressing today’s growing expectations and demands for smart customer service. The key conclusion: Greater alignment is needed between the board room, marketing and customer service professionals, and in the metrics applied to measure customer experience activities, for organizations to succeed in today’s always-on multi-channel customer service environment.
The study identified a number of key challenges that threaten organizations ability to provide “smart” customer service. These include:
Companies are using new channels to support customer engagement, but they don’t understand how and why customers are using those channels.
While organizations are today increasingly deploying multi-channel engagement strategies to support consistent customer experiences, survey respondents indicated a lack of understanding of when and why customers choose to use certain channels over others, and overall channel effectiveness in driving customer satisfaction.
Customer service and the contact center are still not viewed as having strategic importance.
The survey also shed light on the fact that customer service and contact center functions lack adequate board representation, with almost 1 in 10 stating that the board is out of touch with contact center and customer service issues.
Marketing and customer service investment decisions remain siloed, at the expense of the customer experience.
The research also highlights conflicting views about the relationship between marketing and customer service. While many would argue the marketing function is well positioned to assist in orchestrating customer experience for the entire organization, a significant disconnect between marketing and customer service investment is revealed in the study findings.
In response to the research, KANA offered the following recommendations to help rectify the shortcomings and organizational misalignments identified in the study:
Bring the insights from the contact center and the voice of the customer initiatives into the board room, ideally with C-level representation from customer service
Embed a rotation in customer service into senior executive training and personal development plans, and involve operational managers in critical stages of investment planning
Partner with industry suppliers to create seamlessly integrated systems to enable complex business processes to be transformed into effective customer experiences, simplifying for both agent and customer
Understand how to accurately gauge customer satisfaction and measurement in as much as it is a true predictor of future behavior
Evaluate what technology investments will reap customer experience rewards, particularly when the current climate calls for a rational approach
Manage contacts so that the correct proportion and type gets automated or is facilitated by a human
Worldwide Enterprise IT Spending is Forecast to Grow 2.5 Percent in 2013
Worldwide enterprise IT spending is forecast to total $2.679 trillion in 2013, a 2.5 percent increase of projected 2012 spending of $2.603 trillion, according to Gartner, Inc. Banking, communications, media and services (CMS) and manufacturing are expected to offer the largest volume of growth opportunities through 2016.
The manufacturing and natural resources sector will lead the vertical markets with total spending expected to reach $478 billion in 2013, up 2.3 percent from $467 billion in 2012. Manufacturers typically plan and manage a significant portion of their IT costs in expectation of changes in their sales. In addition, manufacturers worldwide have been steadily reducing their IT purchases as a percentage of their sales since the recession of 2008. The manufacturing industry's IT buying center has adopted tighter IT cost controls amid a myriad of mixed market signals. However, IT spending rates are expected will bottom out in 2013 and will be resilient over the long run, as business confidence is restored and the value proposition of a nexus of new technology forces — social, mobile, big data and cloud — is increasingly championed by senior leaders.
The banking and securities sector will have strong growth in 2013 and is expected to reach $460 billion in 2013, up 3.5 percent from $445 billion in 2012. Banking and securities is an IT-intensive industry, spending approximately three times as much on IT as a percentage of revenue than the average of all industries. This trend is expected to continue due to a significant amount of IT required to run activities such as lending, payments, trading and risk management.
The CMS sector is forecast to grow 3 percent in 2013 to $426 billion, up from $414 billion in 2012. Firms in the CMS sectors will typically spend approximately 5 percent of their revenue on IT on average over a five-year period, well above the median for all industries.
In the short term, transportation and insurance will also be high-growth sectors with both reaching more than 4 percent growth in 2013. IT spending in the transportation sector is expected to total $126 billion in 2013, up from $121 billion in 2012. IT spending in insurance will reach $187 billion in 2013, up from $179 billion in 2012.
In 2012, government IT spending is forecast to decline 2 percent and the decline is expected to continue through 2013. In 2013, government IT spending is forecast to total $445 billion, down from $447 billion in 2012.
Large industry market operating under fiscal pressure, such as government, can also provide market opportunities as IT departments must strive to modernize and increase service levels without increasing resources. The need for greater efficiency and productivity gains in industries operating under severe fiscal constraints can also create opportunities for disruptive IT innovation and for the displacement of incumbent IT market leaders.
The changing shape of IT is causing CIOs to question the role of IT in the organization and the part they will play in it, according to Gartner, Inc. As businesses confront global economic uncertainty, changing market dynamics and cultural discontinuities created by technological innovation, their different parts require different ways of interacting with IT.
Gartner has identified four dominant futures for IT in the organization. They are not mutually exclusive and may exist in combination:
IT as a Global Service Provider
In this scenario, the IT organization is an expanded and integrated shared-service unit that runs like a business, delivering IT services and enterprise business processes. It is virtually or fully centralized, focuses on business areas and business value, adopts a marketing perspective, capitalizes on its internal position and delivers competitive services.
IT as the Engine Room
In this scenario, IT capabilities are delivered rapidly at market-competitive prices. The IT organization succeeds by monitoring technology and market developments, and building expertise in IT asset optimization, sourcing and vendor management, and IT financial management. It delivers ongoing cost improvements, looks for new ways to deliver the same IT capabilities for less, and is highly responsive to changing business needs.
IT "is" the Business
In this scenario, information is the business's explicit product or at least is inseparable from its product. The business is structured around information flow (not process or function) and the IT organization innovates within the value chain, rather than just enabling the supporting services found in every business.
In this scenario, business leaders and individual contributors use information and technology aggressively to break through traditional business perimeters and drive ambitious collaboration. The focus is on information, rather than technology. Highly mature businesses embrace this divergent model for its collaborative and innovative potential. While traditionalists may see anarchy in this type of approach, others see liberated creativity. For this reason, this model works in non-traditional situations such as dynamic businesses, startups and R&D/entrepreneurial/community ventures.
Gartner said that these new CIOs will play an important role in identifying the required future of the IT organization, and that they must ensure senior IT stakeholders are involved from the outset, so that their support is guaranteed. These CIOs will then be able to identify how their role will change and start planning a personal road map.