In today’s fast-evolving world, the question is no longer if disruption will impact your business, but when.
According to a survey released in January 2024 by PwC, 45% of CEOs worldwide expressed concerns that their companies might not survive the next decade without significant reinvention, particularly in the face of climate disruption and advancements in AI. This concern is global and for any industry and company size, reflecting the pressures of adapting to rapid digital advancements and unprecedented climate threats.
“The ability to embrace change and take advantage of it will determine the winners and losers of the 21st century,” stated René Rohrbeck, Professor of Foresight, Innovation and Transformation Chair Director of EDHEC Business School. In his 2023 Global Future FITness Study and earlier research, Rohrbeck found that companies with high ‘Future FITness’ outperform their rivals with +33% in profitability, +200% higher market capitalization growth, and 44% to make it to the group of best outperformers in their industry cluster.
Therefore, although the realities driving the CEOs’ anxieties are complex, the message is simple: surviving and thriving in the next decade requires a fundamental shift. This environment requires proactive leadership that views transformation as a continuous journey, rather than a one-time project.
Two key challenges
Companies must adapt to many challenges, specifically to a dual challenge of climate risk and technological disruption.
1. Environmental pressures
Climate change has moved beyond corporate social responsibility and into operational strategy. Consumers, regulators and stakeholders increasingly demand that businesses adopt sustainable practices as a standard expectation. In a September 2024 study, Bain & Company reports that 60% of consumers have heightened their concerns about climate change over the past two years. In addition, over a third of B2B customers are willing to switch suppliers if sustainability needs aren’t met and nearly 60% say they’ll be willing to do so three years from now. Businesses are thus being called upon to demonstrate responsible practices as an ethical imperative and as a competitive necessity.
2. Digital disruption
Meanwhile, technology’s accelerating pace presents a two-sided challenge. Digital transformation, especially in areas like artificial intelligence, is both an enabler of growth and a potential threat to companies that lag in adoption. Successfully integrating digital tools can enhance agility, efficiency and customer experience; neglecting these advances, however, risks making a company obsolete in increasingly tech-savvy markets.
