Business leaders worldwide feel ill-prepared for what they are sure will become an increasingly complex business environment, according to a new survey from IBM.
And Australian CEOs feel even less prepared to cope with increased complexity than their international peers.
Complexity is being increased by an explosion of data, as well as volume and means of communication in an increasingly connected world, IBM said.
A massive 84% of CEOs from Australia and New Zealand replied they expected the level of complexity to grow significantly over the next five years, but only 39% believe they know how to deal with this increase.
By comparison slightly less than half of global respondents felt adequately prepared for increasing complexity.
The gap between awareness of future business complexity and perceived ability to deal with it is larger in A/NZ than any other part in the world, according to Matt English, an IBM Global Services partner.
“Over the last 10 years, globalisation and the nature of the Australian market has driven Australian CEOs to become more competitive and responsive to changes across various international markets,” he said.
“Post GFC, Australian CEOs recognise that they need to go further, [seeing] the need for greater agility, insight and vision to be more proactive to stay competitive.”
Australian CEOs also differ on the most important quality to have to deal with increased business complexity, with Australians picking integrity, while global CEOs chose creativity.
They are also less likely to prefer quick decisions, with 25% of Australians favouring quick decisions compared to a global average of 33%.
Four in five Australian respondents said complexity was exacerbated by the shift in economic power to developing markets, and 25% said it was made worse by the need to double revenue from new sources in the next five years.
And only 36% said they were focusing on simplifying their products and operations to better manage complexity – a smaller percentage than anywhere else except the US.
Instead, 63% preferred to fight complexity by reducing fixed costs and increasing variable costs, to allow easy scaling up and down.