Optimistic CEOs in the UAE plan to innovate to overcome disruption

12 February 2018 Consultancy-me.com 5 min. read

CEO’s in the United Arab Emirates are wholly united in their optimism for growth over the next three years, and are ready to embrace the expected coming technological disruptions as an opportunity for innovation.

In a survey of the leading CEO’s of the UAE, conducted by Big Four professional services firm KPMG as part of their wider Global CEO Outlook report (and covering representatives of 11 key industries including the banking, insurance, investment, energy, retail, telecom and automotive sectors), the full set of respondents were either confident or very confident that their organisations would experience growth over the next three years.

And this widespread optimism extended beyond their own organisations to the expectation for growth in their specific industries, as well as the country and the Middle East at large – despite a corresponding doubt for the projected shape of the global economy, with barely one half expecting a parallel in economic growth beyond the region. In contrast, over two thirds of their global counterparts are confident in this respect as to at least the twelve-month outlook.

The expressed optimism for growth in the next three years from CEO’s in the UAE was also seemingly in contrast to the counter-expectation from nearly two thirds of the respondents who anticipated major disruption in their sector over the corresponding period. Yet, the same percentage of respondents considered such disruption as an opportunity to innovate and capitalise rather than as a threat to their core business. Top 7 areas likely to see high investmentIn fact, nearly three quarters of the respondents believed that innovation would be critical to future growth and business transformation, while nine out of ten were projecting investment in the area over the short term, including on new products and services and ways of doing business. A full 100% of the UAE respondents referred to greater innovation as a priority for strategic growth – in sharp contrast to just 53% of their surveyed global counterparts.

Notably, 68% of those surveyed intend to invest in new technologies, with 84% looking heavily toward data analytics tools and robotic process automation, followed by cognitive technologies, such as AI and machine learning, and cognitive automation as the areas of greatest interest. A further 60% were expecting to invest in blockchain, which has only recently been introduced to the region. Altogether, over three quarters of the CEO’s believed their companies were keeping current with technological developments – compared to an only 47% positive response globally.Top 3 Investment ObjectivesIn terms of investment objectives, there was also a striking difference between the responses of CEOs in UAE and their international counterparts as a whole. 95% of UAE CEOs cited ‘improving bottom-line growth’ as a primary objective for investment against 70% globally, while 74% compared to 53% indicated the ‘strengthening of organisational resilience.’ The biggest disparity, however, was in respect to ‘improving customer engagement’, with the 95% vs. just 45% globally marking a 40-point difference.

Indeed, ‘customer focus’ was cited by 88% of the UAE CEOs as critical to future growth and business transformation, to place alongside but effectively hand-in-hand with innovation. And while 68% said they were actively disrupting the sector they were operating in, 76% and 72% still stated that staying on top of current trends in the market as to customer preferences, and respectively; their competitors’ ability to take business from their organsisations were among their areas of greatest personal concern.

These concerns can be seen as reflected in the strategies noted by the CEOs in their goal to improve customer relations. The report states; “The biggest challenge to customer relations were centred around keeping up with a fast changing market, in particular; an inability to target growth segments/demographic groups in some markets, mentioned by 32% of CEOs, targeting Millennials who want to interact with their brand in different ways, 24%, and transitioning to digital sales and service models, 16%, came on top of the list of challenges.Strategies to improve customer relationsAltogether, the authors of the report believe that the survey results potentially demonstrate a heightened technological awareness among UAE CEOs compared to their international counterparts. Vijay Malhourta, Senior Partner and CEO for KPMG Lower Gulf, said; “Disruption is a fact of life for UAE CEOs. They – and their businesses – must continuously respond to increasing uncertainty. However, the CEOs we’ve engaged with see opportunity where others may see risk and see possibilities for growth where others see challenges.”

Vikas Papriwal, Head of KPMG Markets, adds; “We all know that organisations are facing technological challenges. However, CEOs in the UAE are optimistic, resilient and flexible in their approaches to finding ways to push ahead and grow their businesses in both traditional and non-traditional ways and this is very encouraging.”

Farhan Syed, a Partner with KPMG Lower Gulf and head of the firm’s Digital Transformation in the region, recently reflected on the unprecedented opportunities that digital labour in the GCC can offer.