Digital short termism ‘frustrating’ UK CEOs
Written by Chris Lemmon
The majority of UK chief executives are frustrated by short termism and the pressure from their board to deliver results on multi-year digital transformation projects.
This is according to new research from KPMG, which surveyed 150 chief executives in the UK. It found that 72 per cent feel there are unreasonable expectations for return on investment with regards to digital transformation projects.
Instead, respondents want their boards to take a long-term view of technology investment, with 64 per cent noting that the company would only begin to see a return on investment (ROI) in artificial intelligence (AI) in three to five years after the initial outlay. Similarly, over half of the CEOs agreed on the same ROI time scale for process automation technologies like robotics.
Almost all (95 per cent) of respondents agreed that despite its challenges, disruption is more of an opportunity than a threat, but 86 per cent are overwhelmed by the time needed to make progress.
Lisa Heneghan, partner and digital transformation lead at KPMG UK, said: “Digital transformation is no longer a choice, it’s an essential driver of revenue, profit and growth. Business leaders need to move away from simply fulfilling client needs, in sometimes laborious ways, to using technology achieve results with more depth, efficiency, and decrease the probability of error.
“The reality is that digital transformation isn’t a simple change that can be implemented overnight and deliver results straight away. It requires embracement of innovative breakthrough technologies, investment in digital skills, and retraining the existing workforce.”
CEOs were also uncertain about the long term impact technology would have on the size and shape of the workforce, advising that it would not necessarily result in a smaller workforce in the immediate future. Seven in 10 respondents said in the short term AI would create more jobs, because firms needed new experts to use the technology being introduced into the company.
“While much has been said about the negative impact of AI on the job market, in the short term we expect it to create jobs in some sectors. Companies are hiring in technical experts to oversee the implementation of new systems, before they make wholescale changes to their workforce,” concluded Heneghan.