Sources of information and trends
The role of leaders in the Fourth Industrial Revolution, the evolution of women presence in leadership positions and the best practices in third-party governance are some of the highlights for this edition.December 2019 | February 2020
The role of leaders in the 4th Industrial Revolution
Survey points to four key executive profiles that will drive the transformations of their companies in this new era.
Understanding how organizations are preparing and adapting to the changes brought about by Industry 4.0 was the goal of the “Leadership in the 4th Industrial Revolution” global survey. Conducted by Deloitte and Forbes Insight, the study was responded by 2,042 C-level executives from 19 countries, representing companies with revenues of more than R$ 1 billion per year, including 125 Brazilians.
The survey shows that leaders who better understand current challenges in key impact areas (strategy, technology, talent, and society) are making more progress than others and have grouped them into four persona types – or leadership profiles – linked to these areas: data-driven decisive, disruption driver, talent champion and social supers.
According to the study, compared to their global peers, Brazilian executives stand out by demonstrating greater confidence about what skills they think are needed for the future. However, they find it more difficult to attract talent with such skills (54%), while on the global average this percentage is 48%. The survey also indicates that Brazilian organizations need to focus more on issues related to the ethical use of Industry 4.0 technologies and the definition of decision-making processes.
Organizational leaders should also consider, according to the study, the adoption of a holistic view of the Fourth Industrial Revolution and how it will change business. The survey results reveal that Brazil still has a long way to go in order to participate more actively in this revolution. Only 29% of respondents in the country believe that the current education system will prepare individuals to perform in this scenario and 28% indicated that they will extensively train their current employees (globally, this figure rises to 43% on average).
“The Fourth Industrial Revolution is recent. Brazil has advanced in this way, but still in a shy manner, centralized in large corporations. This movement needs to be expanded. The challenges facing Brazil today are immense, especially with regard to people. Therefore, the survey focuses on the leaders to trace the current panorama of Industry 4.0 in the country” says Othon Almeida, Chief Operating Officer (COO) of Deloitte.
Access the “Leadership in the 4th Industrial Revolution” survey edition in its entirety.
Brazilians are willing to pay more for 5G
Deloitte's annual survey indicates that the 5G internet is considered very important to users. About 69% of respondents are willing to pay more for the technology and 45% consider migrating to the network as soon as it becomes available.
The use of mobile phones has been consolidated in the daily lives of users as a technology present in various activities, such as work, shopping and entertainment. The “Global Mobile Consumer Survey 2019” study, produced by Deloitte, points out that the smartphone has established itself as a control hub for other connected devices and highlights the high frequency of its use compared to the desktop and notebook. The survey was conducted in 22 countries and counts with the participation of 40 thousand people from 18 to 55 years old, with 2 thousand respondents from Brazil.
Regarding consumer habits, the survey analyzes that the mobile phone is used both in everyday routines, such as watching TV and movies or moving around the city, as well as in financial and consumption issues. The use of media is prominent and respondents claim to access the phone at least once an hour (95%).
Purchases made by apps have high adherence because they offer low delivery cost and high security. In this context, the shopping done via smartphone represents the confidence of users on the device to access digital payment and e-commerce platforms.
The survey also highlights that there is a high expectation of consumers for the arrival of 5G. Mentioned by two thirds of respondents, 5G internet is considered as very important to users. About 69% of respondents are willing to pay more for the technology, if it is ten times faster than 4G, and 45% consider migrating to the network as soon as it becomes available.
“New technologies have come to provide traditional business models, through digital platforms and ecosystems, with a ‘new order’ in the globalization process. 5G comes in to enable the use of these new technologies that will make business transformations possible. This will be the opportunity for Brazil to be part of the block of the leading countries in the Digital Economy” said Márcia Ogawa, Deloitte’s lead partner for the Technology, Media and Telecommunications industry.
Access the “Global Mobile Consumer Survey 2019” survey in its entirety.
Female presence in leadership positions is growing, but needs a faster pace
Despite initiatives for inclusion and diversity in companies, the rise in the number of women in leadership positions is below expectations. Brazilian companies still have a long way to go in this matter.
Strengthening diversity on boards is still a major challenge for organizations around the world. According to the “Women in the boardroom” survey, produced by Deloitte and with the participation of 8,000 companies from 49 countries, women occupy only 17% of the board seats of organizations around the globe. Anachronistic cultures in the workplace, unconscious biases and lack of support for diversity are some of the factors that still hinder women’s presence in leadership positions.
The report also indicates initiatives from different countries to increase this diversity and shares the latest statistics on the presence of women in decision-making meeting rooms, exploring the efforts of each region and highlighting the political, social and legislative trends behind numbers.
While women occupy about 4% of CEO-equivalent positions worldwide, CFO positions demonstrate the most diversity (13%). However, the survey indicates that organizations should not only focus on C-level functions, but also on management positions, as it is precisely at this stage when women tend to stagnate in their careers – this is where companies should apply investment in initiatives to bring more progress in female leadership.
“It is proven that increasing female participation in the labor market can positively influence global GDP in the coming years. In conclusion to the survey, we highlight a connection between increasing the number of women serving on the board and the desire for a more inclusive type of capitalism”, says Patricia Muricy, Deloitte partner who participates in ALL IN, Deloitte’s global inclusion program, which includes a structured initiative to strengthen women’s internal and external participation in the corporate environment.
Of the countries highlighted in the survey, Brazil is in 38th place in the ranking. For the Brazilian assessment, 131 companies were interviewed and there are 90 women in leadership positions in total, or a rate of about 9%. In the first edition of the report, in 2014, the country had around 6% of female representation. There are projects under discussion in the Government and the UN to increase this percentage. Some companies have internal initiatives to promote diversity, such as Deloitte itself.
“In 2017, Deloitte Brazil has committed itself to follow the Women’s Empowerment Principles, UN Women primer, through a committee devoted to the issue of gender equity. Training programs, mentoring, networking, implementation of maternity and paternity programs, flexible working and other actions are part of our initiatives. We believe that all companies must remain committed to diversity and encourage society to create positive attitudes toward women’s career development”, said Angela Castro, Deloitte partner and leader of the Gender Parity Program.
Access the “Women in the boardroom” survey in its entirety.
Human capital focused on learning and “social enterprise”
Reinventing the ability to learn and developing the so-called “social enterprise” were key findings in this study, which is the largest in the world focused on HR and business leaders in general.
To reinvent their ability to learn. This is the challenge that 86% of respondents to the Deloitte’s “Global Trends in Human Capital 2019” survey stated that they needed to overcome before the unstoppable evolution of Artificial Intelligence (AI), cognitive technologies and automation. More than 10,000 Human Resources (HR) and business leaders in general from 119 countries (194 of which are Brazilians) participated in this edition of the study, which highlights 10 trends of immediate concern to this audience.
The main concern identified both in Brazil (96%) and globally (86%) was learning. Globally, employee experience and leadership come in second and third place, respectively – their positions reversed when we talk about Brazil. Overall, however, the study points out that less than 50% of companies are prepared to deal with these three main trends.
In a scenario of digital transformation, 84% of respondents say they need to rethink their workforce experience in order to improve productivity. Regarding the need to adapting to changes, 80% of participants agree that diversification is a way to go.
The survey also reinforces the concept of “social enterprise” – that is, the organization whose mission combines revenue growth and profitability with the need to respecting and supporting its community and stakeholders, including actively listening, investing and managing trends that are shaping the world today.
For Deloitte’s Human Capital Management Consulting lead partner Roberta Yoshida, “leading a social enterprise means recognizing the value of generating profits and returns, while at the same time emphasizing satisfaction of employees, customers and the communities in which it operates. ”
Access the study “Global Trends in Human Capital 2019” in its entirety.
Third-party governance requires more attention and investments
Relationship with suppliers and partners is a cornerstone of good corporate practices, but there is still a long way to go for companies to better address the risks involved in this area.
The fourth edition of Deloitte’s “All Together Now – Third Party Governance and Risk Management” global survey had the participation of 1,055 respondents from 19 countries – including Brazil – from November 2018 to January 2019. It was divided into six themes: economic and operating environment; investments; leadership; operating model; technology and subcontractor; and affiliate risk.
According to the survey, although 83% of organizations report having had a third party incident in the last three years, only 1% of them say they address all important third-party risk management issues and another 20% believe they address most of the necessary elements.
Surveyed companies recognize little investment in third-party risk management. Fewer than three out of ten respondents believe their capital expenditure is the optimal (or above-optimal) amount, number that is repeated in relation to investments in third-party governance professionals and other operating costs.
The study also points out that many organizations admit little internal engagement and coordination, but want to improve. Two out of three place the improvement of these items as a priority action in third-party risk management. Leaders are also looking for innovation, whether by adopting emerging technologies or more sustainable operating models.
Camila Araújo, Deloitte’s Risk Advisory partner, says “a well-defined and developed third-party risk management is critical to the overall success of the organization. Senior leadership can play a crucial role in creating responsible third-party governance prepared to mitigate risks, increase compliance and avoid reputation damages and regulatory errors.”
Access the “All Together Now – Third-Party Governance and Risk Management” survey in its entirety.
Innovation accelerates SMEs’ growth
Survey from Deloitte and Exame confirms that investing in new products and services remains an important pillar for the expansion of small and medium-sized enterprises.
Companies that focus their efforts on innovative projects to develop new solutions and opportunities, as well as gain efficiency, experience stronger growth. This is one of the highlights of the 14th edition of Deloitte’s “The Fastest Growing SMEs in Brazil” survey, conducted in partnership with Exame magazine, which identifies the 100 small and medium-sized enterprises – in the range of R$ 10 million to R$ 800 million in revenue – that grew most in the period from 2016 to 2018.
The survey had the participation of 248 companies operating in the country, of which 100 were featured in the highest growth ranking, with a minimum annual expansion rate of 16.33% and a median annual growth rate of 31.90%. Of the sample of the 100 fastest-growing SMEs, 56% said they consider designing new products and services as one of the most effective forms of progressing in the ranking. Sales force effectiveness (55%) and expansion into new geographic markets (50%) are the items that appear next, among the most cited.
With high expectations for an innovative future, the ranked companies understand that the expansion of technological infrastructure is a significant factor for business improvement – 78% of respondents reported constantly investing in technology and disruptive solutions, while 75% foster an open culture on the topic, seeking new solutions to problems encountered within the corporate structure.
The study also highlighted that 50% of surveyed organizations consider improving customer experience and customer satisfaction as a true competitive differentiator – and this issue was critical for participants to overcome the challenges of the business environment over the past three years. Investing in talents is another important point for the surveyed companies – 75% of respondents said investing in salaries, benefits and people training is a priority for the next three years.
“This data reinforces the importance of innovation and the expansion of new SME solutions. Our commitment to these companies, which are increasingly relevant to the Brazilian business environment, is to show the way for sustainable growth in order to increase their competitiveness and contribute to the economic and social development of the country”, says Ronaldo Fragoso, leader of the Deloitte Center for Regulatory Excellence and Corporate Governance.
Access “The Fastest Growing SMEs in Brazil” survey in its entirety.
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