Digitization, sustainability and flexibility – the characteristics of future businesses.
On behalf of Vodafone Hungary, the research institue of London School of Economics (LSE) has examined more than 2500 types and sizes of, so called, Fit for the Future (FFTF) companies, in 11 countries regarding their resilience and adaptility among others. Research has shown that the number of FFTF businesses is on the rise globally. These businesses address the challenges of the future, are more competitive, are open to digital solutions, it is important for them to operate sustainably, and are able to satisfy the increasing needs of consumers and changing employee expectations in a timely manner.
In light of the study, the group of Fit for the Future enterprises included companies that meet the six characteristics – e.g., openness to new technologies, positive attitude to changes that are most closely related to confidence in future financial performance and preparedness for the future. Vodafone’s study showed that the majority (94%) of FFTF businesses believed they were well-prepared for the risks facing them, compared to only 58% of respondents overall. Also 82% of FFTF businesses said their business continuity plan worked well. London School of Economics‘s research has found a link between preparedness for the future and business performance. The research conducted by the London School of Economics found a link between companies being FFTF and business performance. Organizations that scored a 10-point increase in their FFTF score were more likely to outperform their competitors by 36%.[1] Ultimately, FFTF businesses are more confident and well-prepared for emerging challenges and are better placed to respond quickly to evolving employee and customer demands.
[1] The LSE’s analysis states that businesses currently reporting average financial performance (compared to their competitors) that increase their fit for the future score by ten points will increase the likelihood of outperforming the competition by 36%. Meanwhile looking at all companies’ Environment, Social and Governance (ESG) measures, organisations increasing their FFTF index by points 10 can expect their ESG commitment to improve by six points; more and more requests for tender include ESG criteria.
Mátyás Dobó, Director of Vodafone Enterprise Business Unit, added:“Research clearly shows that the transformation is huge on both employers’ and employees’ sides and the market is fundamentally changing – however, the vast majority of Fit for the Future enterprises are prepared for new challenges, thus being more likely to outperform their competitors. Albeit digitization is undoubtedly essential to meet the growing need for flexibility and competitiveness. Our task as a technology company is to support domestic businesses with our innovative solutions and our reliable and strong network to enable them to be Fit for the Future.”
Digital transformation
The report also highlighted, that FFTF companies are open to new digital solutions, the majority (89%) have created a clear roadmap, compared to just 60% of businesses in general. This preparation has put FFTF businesses in a better place to accelerate digitally during the pandemic, and 71% have done just that, compared to around half of businesses (55%) in general. Globally, 80% of FFTF businesses are very optimistic about at least one of the future technologies tested[2], compared to 66% of all businesses.
2 Businesses were asked about 5G, Cloud/Edge Computing, Artificial Intelligence/Robotics, Mobile Private Networks (MPN), The Internet of Things, Blockchain, Big Data/Analytics, Virtual and Augmented Reality and social media.
Ambition for sustainability
Despite the many challenges that businesses have faced in the last 18 months, FFTF businesses have remained in tune with the growing consumer demand for brands to take an ethical stance on social issues. That is also pointed out by the fact, that 69% of FFTF businesses believe sustainability has become more important to their organizations during the pandemic. 38% of FFTF businesses view sustainability as “absolutely necessary”, which was almost twice the number of general businesses that held the same belief (21%). This trend looks set to continue, with over half (51%) of FFTF businesses planning to increase their spend on ESG and CSR in the next year.
Evolving employee expectations
It is not just customers whose expectations have risen; employees also expect more from their employers, including more flexibility and remote working. Their expectations have become greater on working with the freedom and autonomy that best suits them, also flexibility regarding the working hours. This is especially true for Gen-Z employees. 57% of businesses find this generation having a greater expectation on flexibility of where they work.
Mátyás Dobó, Director of Vodafone Enterprise Business Unit, added: “It is clear from the research that the transformation is enormous, both on the employer’s side and on the employee side – the market is fundamentally changing. The growing need for flexibility is a challenge for the current operation and corporate culture of companies and digitization is undoubtedly essential for future competitiveness. Our task as a technology company is to support domestic businesses with our innovative solutions and our reliable and strong network to enable them to be Fit for the Future.”
Read the full Fit for the Future Report here.
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