Business leaders faced an all-time-high rate of change in 2023 and now expect it to accelerate further in 2024, according to Accenture’s Pulse of Change: 2024 Index, released today ahead of the World Economic Forum Annual Meeting in Davos.
The new annual Index ranks six factors of change affecting businesses—Technology, Talent, Economic, Geopolitical, Climate and Consumer & Social—using a range of key business indicators, such as labour productivity and IT spending. It then compares this data to a survey of 3,400 C-suite leaders on how they view the impact of each factor on their organisations, as well as their preparedness to respond.
The Index indicator analysis reveals that technology disruption increased the most in 2023, rising to No. 1 from No. 6 in 2022, catapulted by advances in generative AI. In the survey, C-suite executives also ranked technology as the No. 1 cause of change.
According to the indicator analysis, Talent was the No. 2 cause of business change (including issues such as skills shortages and lack of employee engagement); yet in the survey, C-suite leaders ranked Talent at No. 4. However, 42% of C-suite leaders say skills shortage is one of the top three challenges that would hold back their organisations’ ability to respond to change, underscoring the importance for businesses of making their talent strategy a priority—especially as they work to tap the potential of new technologies.
The Index indicator analysis found that overall, across all six factors, the rate of change has risen sharply since 2019—183% over the past four years and 33% in the past year alone.
“The level of change has dramatically increased over the last few years, and it requires a structural change in how businesses operate — incremental changes in ways of working and performance are no longer sufficient to compete,” said Peter Burns, Chief Executive Officer Accenture ANZ.
“The most significant source of change and disruption—technology—is also the key to this structural change. We believe that the companies that will succeed in the next decade are those that embrace a strategy of continuously reinventing every part of their business using technology, data and AI, including harnessing the power of generative AI, and ensuring their people are at the centre of their transformations.”
The C-suite survey reveals that rapid pace of change holds continued potential for wide-ranging impact on leaders in the year ahead:
A striking 88% of leaders anticipate an even faster rate of change in 2024.
Technology disruption seen as opportunity, with caution about responsible use
Sixty-one percent of C-suite leaders expect the pace of technology disruption to accelerate even further in 2024, and 76% see generative AI as more of an opportunity than a threat and more beneficial to revenue growth than cost reduction.
However, nearly half (47%) say they are not fully prepared for the accelerating rate of technology change, and 72% are now approaching investments with more caution because of societal concerns about the responsible use of AI.