Executives from the Emirates participated in a global survey on future-proofing, where 40% of companies said a reluctance to abandon business models is an obstacle for innovation
A new report from SAP Insights, the global technology’s research division, has revealed a formula for business resiliency, which includes access to data, innovation, optimizing processes and preparing the workforce for change. The insights were captured from a survey of more than 4,200 business leaders at medium and large organizations in 13 countries around the world, including the UAE.
A concerning finding is that most global business leaders interviewed do not believe their companies excel at many of the nine capabilities deemed necessary for resilience in the face of disruption. While 30% do not judge themselves as ‘highly effective’ at any of the capabilities, the remaining 70% give themselves this top rating in only three or fewer of capabilities.
It is notable, however, that the UAE scores were higher than the global average on all nine resilience capabilities. In the UAE, the capability on which executives most often rated themselves as highly effective was having the financial capacity in cash or other access to capital to withstand an unexpected market event, selected by 36.4% of respondents – higher than the overall global score of 30.2%. This was closely followed by having processes to prepare employees to adapt to new or different roles, with 34.3% deeming themselves highly effective at this, whereas globally it was 28.9%.
Commenting on the results, Marwan Zeineddine, Interim Managing Director, SAP UAE, said: “It is positive to see that UAE companies feel better prepared than many of their global counterparts to deal with business disruptions, although a few improvements could greatly increase this confidence. Enhancing access to meaningful business data is a clear example. This is confirmed by the fact that respondents who rated their capability for dealing with current and future challenges as high, also reported having better access to data for decision-making, and vice versa. This is why SAP is so focused on incorporating data analytics and AI capabilities into our portfolio of business technology solutions to support agile and effective leadership.”
In addition to current resilience, the report also found a similar global lack of confidence in businesses’ ability to predict and prepare for problems that might affect them in the future. Almost one-third (32%) of respondents said they are not extremely satisfied (the top rating) with their company’s performance in any of 12 capabilities needed for future resilience. Similar to the current resilience findings, 65% said they are extremely satisfied with only three or fewer areas, and no respondents chose all 12.
Once again UAE companies were more confident in their future resilience across all 12 capabilities, and the highest confidence was reported on the ability to monitor and analyze all aspects of the business, with 31.7% extremely satisfied, compared to 21.7% globally. The next highest rated capability was flexibility of business processes, for which 31% of UAE respondents were extremely satisfied, compared to only 22% in the global results.
Innovation, HR and growth
In addition to finding a positive correlation between data access and resilience, the report highlights innovation as a second key factor, although this is not without its challenges. Findings show 40% of global respondents – and 43.6% of UAE respondents – reported “difficulty letting go of current business models” as their main barrier to innovation.
Another key to improving resilience identified is optimizing processes, which requires employees to be trained to deal with necessary changes. According to the study, respondents who said they are very effective at preparing employees to adapt to new or different roles are also more ambitious about making the process changes that improve resiliency.
Commenting on the significance of the SAP Insights report, Zeineddine points out that resilience is a key factor in growth and profit. “The survey confirmed that businesses that rate themselves highly in future resilience are more likely to predict they will increase revenue by 6% or more. Conversely, companies that are less satisfied with their capabilities are more likely to expect their revenue will stagnate or decline. The survey shows, therefore, that thinking ahead is an integral component of business success in the UAE and other major global business hubs.”