Leading through Connections

© 2012 IBM Corporation

IBM Institute for Business ValueIBM Institute for Business Value


IBM Institute for Business Value

Revenue growth is the #1 priority

Responsiveness is key competence

Improving internal capabilities as first step to growth

Revenue growth is the #1 priority

Responsiveness is key competence

Improving internal capabilities as first step to growth

Business model innovation matters

External collaboration

Innovation must be orchestrated from the top

Business model innovation matters

External collaboration

Innovation must be orchestrated from the top

Hungry for change Customers as

opportunity to differentiate

Business model innovation, global business designs

Hungry for change Customers as

opportunity to differentiate

Business model innovation, global business designs

Embody creative leadership

Reinvent customer relationships

Build operating dexterity

Embody creative leadership

Reinvent customer relationships

Build operating dexterity

Empowering employees through values

Engaging customers as individuals

Amplifying innovation with partnerships

Empowering employees through values

Engaging customers as individuals

Amplifying innovation with partnerships

2

2004

Your turn

2006Expanding the

Innovation Horizon

2008The Enterpriseof the Future

2010Capitalizing on

Complexity

2012Leading through

Connections

The Global CEO Study 2012 is the fifth biennial CEO study, building on our insights and findings over the last 8 years

765 interviews765 interviews 1130 interviews1130 interviews 1541 interviews1541 interviews456 interviews456 interviews 1709 interviews1709 interviews



3

Note: The CEO response sample (n=1709) has been weighted based on 2010 Regional GDP of the IMF World Economic Outlook

The study represents organizations in 64 countries across 18 industries

North AmericaWestern EuropeJapan

CommunicationsDistributionFinancial Services

Australia / New ZealandGrowth Markets

IndustrialPublic

Regions Sectors

In this largest known sample, we spoke with over 1700 CEOs –battle-tested leaders with an average tenure of 6 years



Three performance categoriesThree performance categories

4

Particular attention on OutperformersParticular attention on Outperformers

No significant difference between outperformers and underperformers on 82% of tested characteristics

→ Though outperformers and underperformers often say the same, outperformers are superior at doing what they say

→ In this study we focus on common performance factors, while we highlightthe most significant differences between out- and underperformers

No significant difference between outperformers and underperformers on 82% of tested characteristics

→ Though outperformers and underperformers often say the same, outperformers are superior at doing what they say

→ In this study we focus on common performance factors, while we highlightthe most significant differences between out- and underperformers

Peer PerformersAll other performance combinations

OutperformersHigh revenue growth and high profitability

UnderperformersLow revenue growth and low profitability

We compared outperformer and underperformer responses and have highlighted key differences

Note: Relative performance is defined by CEO self-assessment of revenue growth and profitability compared to industry peersSource: QB “How does the revenue growth of your organization compare to your industry peers over the past 3 years?”; QC “How does your

organization’s profitability (or efficiency for public sector) compare to your industry peers over the past 3 years?”



5



6



7

Organizational openness introduces new opportunities to create value through

employee collaboration

Organizational openness introduces new opportunities to create value through

employee collaboration

Customers reveal insights into what, when and how they want to interact

Customers reveal insights into what, when and how they want to interact

Virtually all organizations now partner, creating new avenues for innovation


What we learned from all CEOsWhat we learned from all CEOs What outperformers do differentlyWhat outperformers do differently

Technology has become the most important external force for CEOs and significantly impacts how they build economic value

Outperformers embrace greater openness, and excel at executing

tough change


tough change

Outperformers strongly differentiate through better data access, insight and

translation into actions

Outperformers strongly differentiate through better data access, insight and


Outperformers are more likelyto partner for innovation, disrupt, and

derive revenue from new sources

Outperformers are more likelyto partner for innovation, disrupt, and




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Key Discovery

Source: Q1 “What are the most important external forces that will impact your organization over the next 3 to 5 years?”

External forces that will impact the organization

68%

69%

71%

2004 2006 2008 2010 2012

Technology factorsTechnology factors

People skills

Market factors

Macro-economic factors

Regulatory concerns

Globalization

Socio-economic factors

Environmental issues

Geopolitical factors

For the first time, CEOs identify technology as the most important external force impacting their organizations



9

Source: Q24 “What do you see as the key sources of sustained economic value in your organization?”

Key sources of sustained economic value

Human capital

Customer relationships

Products / services innovation

Brand(s)

Business model innovation

Technology

Partnership networks

Data access / data-driven insights

R&D, intellectual property

Price / revenue innovation

Assets (physical, infrastructure)

Corporate social responsibility

Access to raw materials

71%71%

Key Discovery

Internally, CEOs focus on how technology facilitates primary sources of sustained economic value

66%66%

52%52%

43%43%

33%33%

30%30%

28%28%

25%25%

22%22%

19%19%

15%15%

13%13%

8%8%



10

Source: QE “To what extent has your organization integrated business and technology to innovate?”

Integrating business and technology for innovation

41%

Outperformers

Underperformers

69%69%

6868%more

Outperforming organizations are especially focused on combining technology with the business to drive innovation and growth

Outperformance drivers



11

CEOs create more economic value by cultivating new connections within and across three domains



12

Organizational openness introduces new opportunities to create value

through collaboration

Organizational openness introduces new opportunities to create value

through collaboration

How will CEOs create more economic value by empowering employees through values?

To re-balance control with openness, CEOs are focused on values,

collaboration and mission

To re-balance control with openness, CEOs are focused on values,

collaboration and mission


tough change


tough change



13

Source: Q4 “To what extent will the following competing influences impact your organization?”; CEO average is 33% on control, 23% balanced, and 44% on openness

Organizational impact from competing influences

35%

17%

Operational controlTight operational and financial control to ensure compliance, avoid waste, and enforce standards, norms and behaviors

Organizational opennessOpening of organizations internally and externally and empowerment of individuals to facilitate innovation, collaboration, and creativity

Balance between openness and control

Key Discovery

The challenge CEOs face is how to balance operational control with organizational openness to capture benefits from collaboration

48%37%

30%33%

Outperformers

Underperformers



CFOs report that pressure remains high to control costs and increase efficiency

14

Source: IBM Institute for Business Value, The Global CFO Study 2010. Question asked: “In the next 3 years, how will the following conditions change in your industry / sector?”

Pressure to reduce cost base

Need for faster decision making

Demand for external transparency

Product / service demand growth

Ability to attract and retain talent

Access to short-term liquidity / long-term capital

78%78%

74%74%

69%69%

61%61%

56%56%

40%40%

Operational control provides value to organizations, including cost reduction, operating margin and security



15

Changing the organization

Partnering/collaborating with other organizations

Internal collaboration

Decision-making processes

C-suite composition, skills and responsibilities

Management and/or organization structure

Governance models

Values of your organization

Supervisory board composition

53%53%

52%52%

43%43%

41%41%

40%40%

31%31%

18%18%

However, CEOs plan dramatic improvements in internal and external collaboration, requiring organizational openness

Source: Q19 “To what extent will you sustain or make changes to the following aspects of your organization over the next 3 to 5 years?”

15%15%



16

Source: Q18 “What are the most important organizational attributes to engage employees?”

Organizational attributes to engage employees

Ethics and values

Collaborative environment

Purpose and mission

Ability to innovate

Industry leadership

Stability of the organization

Work-life balance

Personal autonomy

Financial rewards

Work flexibility

Cultural diversity

Customizable compensation

Comprehensive mentoring

65%65%

Key Discovery

To re-balance control with openness, CEOs are focused on values, collaboration and mission

63%63%

58%58%

51%51%

40%40%

37%37%

35%35%

31%31%

31%31%

24%24%

21%21%

18%18%

18%18%



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Source: Q17 “What are key personal characteristics that help employees to be more successful in a connected economy?”

Personal characteristics for employee success

Creative

Flexible

Collaborative

Communicative

Opportunity seeking

Analytical / quantitative

Technology-savvy

Globally-oriented

Assertive

Disruptive

75%75%

67%67%

61%61%

61%61%

54%54%

50%50%

41%41%

41%41%

25%25%

16%16%

Key Discovery

In this new environment, key success factors for employees include: collaboration, communication, creativity and flexibility



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Ability to manage change


40%

69%69%

7373%more

Outperformers

Underperformers

Outperformers excel at executing tough change

Source: Q3 “How successful has your organization been at managing change in the past?”; average ability to manage change is 54%



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So, how do you empower employees through openness?

Confront cultural reality Build values employees will live out Recalibrate controls

Confront cultural reality Build values employees will live out Recalibrate controls

Create unconventional teams Concentrate on experiential learning Empower high-value employee networks

Create unconventional teams Concentrate on experiential learning Empower high-value employee networks

Pursue social collaboration technologies Devise incentives that foster collaboration Re-imagine employee “suggestion box”

Pursue social collaboration technologies Devise incentives that foster collaboration Re-imagine employee “suggestion box”

1. Replace rulebooks with shared beliefs

1. Replace rulebooks with shared beliefs

2. Build future-proof employees

2. Build future-proof employees

3. Provide the means to collaborate at scale

3. Provide the means to collaborate at scale



CEO cannot manage openness through process alone. In an open environment, employees must instinctively know how to handle unexpected situations – choices and actions are best guided by shared beliefs and values

Confront cultural realityTake a hard look at your corporate character – not the reputation you intend to project, but what is actually revealed through the decisions and actions of employees and leaders

Build values employees will live outAllow the organization to collectively compose its core values – to develop a shared belief system, employees must help create it

Recalibrate controlsKey is determining which rules to keep and refine – seek to eliminate those that can be “controlled” through values

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Purpose Build and align common values

to promote performance with integrity

Create ambassadors among employees

Activities Articulated core beliefs and

expected behaviors

Enabled employee dialog across intranet

Promoted social polling and twitter-like platform

Replace rulebooks with shared beliefs

Industrial products business, Europe



Organizations need employees who are equipped to adapt – those who are collaborative, communicative, creative and flexible

Create unconventional teamsIntentionally mix specialties and expertise so that employees rub shoulders with diverse types of people who think differently and have different backgrounds

Concentrate on experiential learningBroaden the range of situations and experiences that employees are exposed to in their normal work – incorporate external influences, like customers and partners, wherever possible

Empower high-value employee networksEncourage employees to develop a diverse and extensive network of contacts – don’t underestimate the value of their social networks as both potential collaborators and prospective customers

21

Purpose Identify and leverage synergies

across lines of business

Expand value created from innovation

Activities Formed cross line-of-business

knowledge community

Engaged external partners to help identify synergies

Initiated training to promote collaboration and innovation

Build future-proof employees

Consumer products business, Europe



As organizations globalize and the boundaries between functions blur, organizations need more extensive, sophisticated methods of collaborating

Pursue social collaboration technologiesEnsure employees can quickly find needed expertise and can engage the collective intelligence of the organization – capture experts’ knowledge in searchable repositories

Devise incentives that foster collaborationBe sure employees are clear on how collaboration benefits them individually – intrinsic motivators are visibility and reputation, competitive spirit and shared goals

Re-imagine the employee “suggestion box” Use social media technologies to pursue good ideas – through open dialog, collective construction of solutions and feedback on results

22

Purpose Promote sustained growth

through empowerment, responsibility and trust

Build skills and become part of local communities

Activities Introduced social media including

comment spaces, blogs and an idea network

Integrated enhanced podcasts with two-way interactions

Pursued community out-reach

Provide the means to collaborate at scale

Consumer products business, USA



For over 150 years, Bausch + Lomb is an eye-health pioneer, active in over 100 countries.

Recently B+L initiated a major cultural transformation to reinvigorate and refocus its innovative spirit:

Social and mobile technologies facilitate communication and sharing of best practices among employees:

In 2011, revenues hit an all-time company high, quadrupling the average annual growth rate.

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Case Study: Bausch + Lomb – One team focused on one mission

Providing direction through a clearly defined vision, mission and strategy Introducing “High Performance Behaviors” Inverting the classic management pyramid through an increased focus on

front-line managers

Let people communicate at work like they do at home, through internal social platforms

Get information to and from the field as quickly as possible, through early adoption of handheld tablets for customer-facing employees



24

Customers share insights into what they value individually, and when and how

they want to interact

Customers share insights into what they value individually, and when and how

they want to interact

How will CEOs create more economic value by engaging customers as individuals?

To connect individually, CEOs plan a step change in social media interaction

and continuing face-to-face engagement

To connect individually, CEOs plan a step change in social media interaction

and continuing face-to-face engagement

Outperformers strongly differentiate by better data access, insight, and translation into actions

Outperformers strongly differentiate by better data access, insight, and translation into actions



Customers will share information if they perceive a benefit

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Source: IBV Retail 2012 Winning Over the Empowered Consumer Study P04 “What is your willingness to provide information for each of the following items if [pipe primary retailer] provided something relevant to you in exchange?”

Media usage (e.g. media channels)

Demographic (e.g. age, ethnicity)

Identification (name, address)

Lifestyle (# of cars, home ownership)

Location based

Medical

Completely disagreeNeutralCompletely willing

What is your willingness to provide information in exchange for something relevant to you (non-monetary)?

Customers share insights into what they value individually, and when and how they want to interact

Financial



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Drawing insight from information – Areas of improvement

Source: Q23 “In which areas do you plan to improve your ability to draw meaningful and executable insights from available information?”

Customers

Operations

Sales

Markets and competitors

Human resources

Supply chain

Risk management

Financials

73%73%

50%50%

49%49%

44%44%

43%43%

40%40%

38%38%

32%32%

CEOs identify customer insights as the most critical investment area



27

Change required to meet customer expectations (3 to 5 years)

Source: Q9 “To what extent will your organization change to meet customer expectations compared to your industry peers over the next 3 to 5 years?”

Improve understanding of individual customer needs

Improve response time to market needs

Harmonize customer experiences across channels

Include customers / citizens across product / service life cycle

Increase transparency and corporate accountability

Increase social and environmental responsibility

72%72%

72%72%

CEOs want to understand individual customers better and respond faster

55%55%

48%48%

47%47%

44%44%

Key Discovery



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Source: Q8 “What are the three most important mechanisms your organization will use with customers over the next 3 to 5 years?”*Face-to-face / sales force / institutional representatives

80%

67%

40%

31%

39%

15%

22%22%

41%38%

16%

57%

47%

55%

Face-to-face* Callcenters

Traditionalmedia

Advisory groups

Channelpartners

WebsitesSocialmedia

Mechanisms to engage customers

Key Discovery

Today

In 3 to 5 years

To connect individually, CEOs plan a step-change from traditional to social media, while continuing face-to-face engagement



29

Source: Q22 “How good is your organization at driving value from data? [Today]”

Outperformers strongly differentiate their organizations in three key areas


26%

54%54%

108108%more

Access to data

Outperformers

Underperformers

31%

57%57%

8484%more

Translate insight into action

26%

54%54%

108108%more

Draw insights from data

Outperformers are twice as good at deriving value from data – key to engaging customers as individuals



1. Let “big data” reveal the customer you never knew

1. Let “big data” reveal the customer you never knew

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2. Listen lavishly, respond with focus

2. Listen lavishly, respond with focus

3. Be where your customersexpect you to be

3. Be where your customersexpect you to be

So, how do you win the race to gather andconvert data into customer insight and action?

Look outside to complete the view Connect pieces into profiles Empower staff with predictive analysis

Look outside to complete the view Connect pieces into profiles Empower staff with predictive analysis

Listen at an individual level Capture what employees see and hear Respond with relevance and speed

Listen at an individual level Capture what employees see and hear Respond with relevance and speed

Leverage the fact that mobile “changes everything”

Blend the physical and digital worlds Offer value that stands out

Leverage the fact that mobile “changes everything”

Blend the physical and digital worlds Offer value that stands out



Today’s analytics provide opportunities to explore big data, detect patterns and reveal new insights – knowing how to effectively access, analyze and use data is crucial to understanding and engaging individual customers

Look outside to complete the viewIncorporate external sources, especially social media and complementary data sets from partners – blend internal and external views to discover unexpected insights

Connect pieces into profilesUse analytics to distill what’s valuable from an abundance of data – assemble vital pieces into holistic profiles of individual human beings

Empower staff with predictive analyticsEmbed insights where front-line decisions are made – ensure data-driven decision making is part of everyday processes

31

Purpose Gain deeper insight into agency

performance and customer value drivers

Build “analytical culture” across business units

Activities Identify high-value and high-

potential customers and maximize their lifetime value through customer profiling, micro-segmentation, and analysis

Improve understanding of market potential and competitive forces to help make better decisions

Let “big data” reveal the customer you never knew

Insurance business, USA



In exchange for more insight, customers want organizations to interact selectively and responsibly – offering what they want, when and where they want it

Listen at an individual levelLook beyond aggregate customer information based on market segmentation – use sources that allow you to hear directly from individual customers

Capture what employees see and hearEstablish easy ways to channel clues employees observe in their customer interactions – incorporate these insights into your analysis

Respond with relevance and speedStudy each customer touch point and find ways to respond more selectively and create deeper connections that build loyalty and advocacy

32

Purpose Increase customer satisfaction

Improve process, workflow effectiveness and time to market

Activities Introduced social network

analysis to help identify key opinion leaders, tailor offerings and understand behavior and decision making

Established real-time analytics to assess new product penetration and success

Listen lavishly, respond with focus

Universal bank, USA



Mobility is elevating customer expectations: organizations have a tremendous opportunity to create value out of immediacy – to be ready with relevant services and information in the context of the moment

Leverage the fact that mobile “changes everything”Take advantage of location-based services and new forms of e-commerce

Blend the physical and digital worldsExploit augmented reality to make mobile part of integrated, multichannel customer experiences

Offer value that stands outInteract in ways that are attention-grabbing, meaningful and tailored to the individual

33

Purpose Leverage customer insights

obtained from past online interactions to formulate personalized, timely experiences

Activities Used mobile capabilities to

enhance online and in-store customer personalization and overall engagement

Improved customer loyalty by anticipating needs and establishing consistent high- quality customer service

Be where your customers expect you to be

Retail business, USA



Since 1957, Magazine Luiza has connected with customers in Brazil on a human level, to fulfill dreams and provide a happy and memorable experience.

Magazine Luiza provides an online store and more: In their stores, shoppers sit with associates who guide them on Internet

shopping trips Local stores act as social hubs and offer community services, like

cooking classes or computer training The online site contains a virtual salesperson “Lu”, interacting with

customers

In response to today’s customer individualization, Magazine Você (“Your Store”), allows anyone to create personalized storefronts and share them via Facebook or Orkut: Store “owners” earn a commission when selling products Conversion rates are running higher than the retailer’s online store

Already, more than 20,000 social stores have sprung up. Magazine Luiza expects to touch 1 million customers within one year of launch.

34

Case Study: Magazine Luiza – Maintaining a human touch in an online world



35

Commitment to external partnering has grown significantly

Commitment to external partnering has grown significantly

How will CEOs create more economic value by innovating differently with partners?



Outperformers are more likelyto partner for innovation, disrupt,

and derive revenue from new sources

Outperformers are more likelyto partner for innovation, disrupt,

and derive revenue from new sources



36

Source: Q16g “What will your operating strategy be in 3 to 5 years, compared to today?” [Partner extensively / Do everything in-house]

Historical comparison of external partnering

Key Discovery

55%55%

2012

2008

69%69%

Over the past few years, partnering has become increasingly prevalent – more than two-thirds of CEOs intend to do so

2525%more



CMOs increase use of external partnerships in the areas of sales, analytics, and IT skills

CMOs increase use of external partnerships in the areas of sales, analytics, and IT skills

For CIOs, increased partnering is associatedwith a desire to refine the mix of capabilities

For CIOs, increased partnering is associatedwith a desire to refine the mix of capabilities

37

Sales contact/lead management

Customer and data analytics

Direct/relationship marketing

IT skills

Source: 2011 CIO Study Q7 “To benefit from global integration will your organization do the following?”; 2011 CMO Study Q16 “What do you do within marketing and what resources will you tap into, to manage marketing?”

7%7%

12%12%

13%13%

23%23%

Partnering extensively with other organizations

65%65%

Significantly change mix of capabilities, knowledge and assets

66%66%

Today In 3 to 5 years

CIOs and CMOs have diverse motivations for external collaboration

14%14%

23%23%

23%23%

37%37%



38

External partnering for innovation

Source: QD “To what extent does your organization collaborate and partner (externally) to innovate?”; CEO average score is 53%

Outperformers

Underperformers


46%

59%59%

2828%more

Outperformers partner substantially more often for innovation



Source: Q13 “What key initiatives will you implement over the next 3 to 5 years?”; Q11 “What approximate percentage of your revenue comes from new sources, including new products and services, markets or industries?”

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Outperformers

Underperformers


18%

35%35%

9494%more

Creating entirelynew industries

19%

26%26%

3737%more31%

46%46%

4848%more

Moving intodifferent industries

Industry model innovation Revenue from new sources

Outperformers pursue more disruptive types of innovation and derive more revenue from new sources



40

1. Fundamentally change how you partner

1. Fundamentally change how you partner

3. Break collaboration boundaries3. Break collaboration boundaries

2. Make partnerships personal2. Make partnerships personal

So, how can organizations partner moreeffectively to meet the innovation challenge?

Achieve differentiation through social innovation

Expand scope of partnerships Tackle the shared governance challenge

Achieve differentiation through social innovation

Expand scope of partnerships Tackle the shared governance challenge

Broaden responsibility for managing partnerships

Foster relationships at each level across partnering organizations

“Partners” can be a community of people

Broaden responsibility for managing partnerships

Foster relationships at each level across partnering organizations

“Partners” can be a community of people

Explore unconventional partnerships Think like a disruptor Innovate together as a system

Explore unconventional partnerships Think like a disruptor Innovate together as a system



The pressure and costs to innovate mount, and boundaries between organizations are becoming more porous interactions span more functions and are more continuous, with control and governance increasingly being shared

Achieve differentiation through social innovationExtend communication and collaboration tools so that peers can interact within and across organizations – integrate data resources to reveal unexpected, mutually beneficial insights

Expand scope of partnershipsEvaluate ways to extend and connect existing partnerships on innovation, to include ideation, R&D, and also sales, marketing or HR

Tackle the shared governance challengeEstablish ways to share key aspects of control – such as prioritization, decision making and funding – that are traditionally dominated by one partner

41

Purpose Form relationships with leading

social media organizations to promote innovation in customer engagement

Activities Partnered with Twitter to create

location-specific discounts for customers when they tweet their location

Created "Small Business Saturday“ by offering a $ credit to customers who spend at participating small businesses

Fundamentally change how you partner

Payments and travel business, USA



Technology now presents opportunities for much deeper connections with partners – opportunities for innovation – both spontaneous and orchestrated – are rising in step with interconnectedness

Broaden responsibility for managing partnershipsEmbed relationship management capabilities within the organization – use centralized alliance management functions to supply specialized skills

Foster relationships at each level across partnering organizationsProvide avenues to develop personal connections among peers at every level

Consider the possibility of “partners” being a community of peopleDon’t limit your view to organizations – your most valuable “partnership” might be a group of individuals

42

Purpose

Activities Created strategic distribution

partnerships focused on product planning and promotions

Employees gather customer insights which are routed to partner organizations to inform future product development

Enhance strategic partnerships by engaging employees across sales channels

Make partnerships personal

Retail business, China



To address rising complexity, organizations need to look beyond traditional partners and conventional views on innovation for new inspiration and necessary capabilities

Explore unconventional partnershipsStudy nontraditional alliances emerging in other industries and look for parallel applications in your own – integrate capabilities not commonly found in your own industry

Think like a disruptor Stretch thinking beyond business as usual, even when business as usual is working – question norms, introduce new stimulation from outside

Innovate together as a system Approach untenable issues or grand challenges by partnering across the entire system – with competitors, governments, non-governmental organizations and more

43

Purpose Innovate processes to reduce the

number of components used in car manufacturing

Improve speed and flexibility of production

Activities Formed collaborative

partnerships with suppliers to promote innovation

Reduced procurement costs and improved component design

Break collaboration boundaries

Automotive business, Japan



44

Shell has a long history of partnering for innovation, since 1907.

Collaboration is focused on energy innovations, working with partners to diversify the fuel supply and reduce its environmental impact: Production of sustainable, low-carbon biofuels Developing of next-generation biofuels from waste products, and hydrogen fuel-cell

technology Reducing emissions of traditional fuels used in transportation, such as natural gas

To address energy and environmental challenges, Shell is working with experts to explore relations between energy, water and food systems to gain a deeper understanding of long-term risks and opportunities: Sustainable urban design Reduce water use for electricity generation Alternative transport fuels and heating

Case Study: Royal Dutch Shell – Partnering to power the future



45



46

Source: Q25 “What are the five most important characteristics that a CEO needs to be successful over the next 3 to 5 years?”

CEO characteristics for success

Customer obsession

Inspirational leadership

Leadership teaming

Global mindset

Competitive instinct

Boldness

Transparent

Risk tolerant

Disruptive creativity

61%61%

Financial skills

Technology savviness

Diversity-driven

Environmentally / socially devoted

Key Discovery

In this period of rapid and disruptive change, CEOs lead while learning, outlining three traits critical to their personal success

60%60%

58%58%

48%48%

38%38%

35%35%

34%34%

33%33%

33%33%

24%24%

23%23%

20%20%

16%16%



47

CEOs will lead bold change by providing inspirational leadership to their people, customers and collaborators

Source: Q25 “What are the five most important characteristics that a CEO needs to be successful over the next 3 to 5 years?”



48

Source: Quotes from all questions

CustomersCustomers

InspirationInspiration LeadershipLeadership

TeamingTeaming

We analyzed over 10,000 quotes to uncover the deeper thoughts of CEOs that relate to their key personal aspirations



49

Empowering employees through values Organizational openness introduces new opportunities to create value through

employee collaboration To re-balance control with openness, CEOs are focused on values,

collaboration and mission Outperformers embrace greater openness, and excel at executing tough

change

Empowering employees through values Organizational openness introduces new opportunities to create value through

employee collaboration To re-balance control with openness, CEOs are focused on values,

collaboration and mission Outperformers embrace greater openness, and excel at executing tough

change

Engaging customers as individuals Customers share insights into what they value individually, and when and how

they want to interact To connect individually, CEOs plan a step change in social media interaction

and continuing face-to-face engagement Outperformers strongly differentiate by better data access, insight, and


Engaging customers as individuals Customers share insights into what they value individually, and when and how

they want to interact To connect individually, CEOs plan a step change in social media interaction

and continuing face-to-face engagement Outperformers strongly differentiate by better data access, insight, and


Summary

How CEOs drive new economic value through connections

Amplifying innovation with partnerships Commitment to external partnering has grown significantly Virtually all organizations now partner, creating new avenues for innovation Outperformers are more likely to partner for innovation, disrupt, and


Amplifying innovation with partnerships Commitment to external partnering has grown significantly Virtually all organizations now partner, creating new avenues for innovation Outperformers are more likely to partner for innovation, disrupt, and




To continue the conversation...

For more information about this study and to get the full version of this report, see www.ibm.com/ceostudy2012

Access interactive content and listen to CEOs in their own words by downloading the IBM IBV app for Android or iPad

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51



52

Empowering employees through values 73% more successful in managing change 30% more emphasis on organizational openness almost 3 more years in leading position (time-in-role)

Empowering employees through values 73% more successful in managing change 30% more emphasis on organizational openness almost 3 more years in leading position (time-in-role)

Engaging customers as individuals 108% better at access to data 108% better at drawing insights from data 84% better at translating insights into action

Engaging customers as individuals 108% better at access to data 108% better at drawing insights from data 84% better at translating insights into action

Amplifying innovation with partnerships 68% more likely to integrate business and technology for innovation 48% more are moving into different industries 37% more likely to derive revenue from new sources

Amplifying innovation with partnerships 68% more likely to integrate business and technology for innovation 48% more are moving into different industries 37% more likely to derive revenue from new sources

Summary

What makes outperformers different?



Social networks and mobility

Globalization

53

Data explosion

Demographic shifts

Backup

Within today’s volatile and uncertain environment, four major trends are apparent

Leading through Connections

Documents

bausch lomb

outperformance driversibm institute

key discoveryibm institute

social media interaction

business valuecase study

organizational openness introduces

big data reveal

partnerships amplifying innovation