- A global survey found that Australian CEOs are keener than most for partnership deals as a way to gain growth.
- The KPMG study says 54% are looking at partnering with startups.
- The CEOs are looking at cloud technology providers and data providers.
Australian CEOs are increasingly relying on a network of third parties to achieve growth, according to the latest Global CEO Outlook study from KPMG.
More than half (54%) are looking at partnering with startups and the majority (71%) acknowledge that third-party partnerships are essential for organisational agility compared with only half (53%) of global peers.
Australian CEOs identified a number of other partnership to drive growth over the next three years including working with third-party cloud technology providers (58%), third-party data providers (56%), and collaborating to develop innovative technologies (52%).
“It’s clear that Australian CEOs have recognised that in a market that is rapidly evolving, no single organisation has the agility needed to thrive and that collaboration with others is becoming more critical,” says James Mabbott, Partner and Head of Innovation at KPMG Australia.
“And with one in two looking to work with startups, they have realised that there is a need to embrace different ways of thinking and new business models to accelerate business transformation. Top of mind is technology and data.”
Australian CEOs also identified barriers to working with third parties.
One-quarter (26%) of Australian CEOs cite legacy IT systems that are incompatible with more nimble startups (compared with 15% of global CEOs), while 22% see the main challenge is measuring return on investment from third-party partnerships.
Other barriers include concerns around the sharing and protection of commercially sensitive data (18%) and overly complex procurement systems (14%).
Australian CEOs were also more likely see cultural fit as important to collaboration, with 74% saying they had reconsidered a partnership with a third party that did not fit with their culture compared to just 49% of their international counterparts.
“In an increasingly connected and collaborative future cultural fit will be key and success for large organisation hinges as much on saying no as saying yes to alliance opportunities,” says Mabbott.
“Ensuring that you have the right frameworks to scan, identify and select the right partners is key. And the first thing to look for is a fit with your values and culture. Otherwise you may be selecting the wrong partners, which can come with significant costs, both direct and in terms of missed opportunities.”
The fourth annual KPMG Global CEO Outlook surveyed 1,300 CEOs in almost 50 countries in January/February 2018.
The study also found that most (86%) Australian CEOs are “overwhelmed” by the time needed to deal with disruption and 70% said they were struggling to cope with the pace of technological change compared to just 36% overseas. But most (96%) also saw it as an opportunity.
More than two-thirds (68%) said they were personally prepared to lead their companies through a radical transformation of their operating models in order to maintain competitiveness.
KPMG Australia CEO Gary Wingrove says CEO’s are being measured on their ability to deliver against a transformation agenda.
“Business as usual is no longer good enough, leaders are expected to drive change whilst keeping core operations running effectively,” he says.
“In order to do this, they are increasingly looking to make their organsiations more agile to enable them to drive these changes.
“Whilst many of the CEOs surveyed see the opportunity in making radical transformative change, leaders recognise the difficulty in delivering these changes. Capacity and capability to deliver against this agenda is key to success.”