Those who embrace disruption succeed

DISRUPTED AUSTRALIA

Regardless of how you view disruption it is widespread and reaching almost every sector in Australia.

Sixty-seven per cent of CFOs confirm disruption is currently taking place in their business and 40 per cent admit they are more focussed on managing disruption today compared with a year ago.

The single biggest disruptor to business, according to their CFOs, is existing local competition (38 per cent), indicating mid-sized companies are most concerned by what's already on their doorsteps.

New market entrants from overseas (18 per cent) are the second most disruptive factor, followed by existing international competition (11 per cent). Surprisingly, only 9 per cent of CFOs cite technology as the most disruptive factor.

With a greater focus on managing disruption, it's perhaps not surprising the research reveals company's risk appetites have also increased year-on-year.

Thirty-eight per cent of CFOs rate their company's risk appetite as high – up 6 per cent compared with 2014. CFO's own risk appetite also has increased.

Yet with greater risk taking, the chance of failure also rises. Almost half (46 per cent) of CFOs admit their business is at risk of failure in the next three to five years.

Yet what's clear from our research is there are companies leading the disruptive charge. The most successful initiatives being undertaken by this group are the recruitment of staff with news skills sets (38 per cent), reaching new customer segments (32 per cent) and overseas expansion (26 per cent).

DISRUPTION CREATES OPPORTUNITY

It's certainly true that today businesses must grapple with disruption at never-before-seen levels of speed and intensity. CFOs must now confront the reality of the age of disruption head on in order for their companies to survive and thrive.

What's clear from the research is those embracing it are enjoying the greatest success. The onus is now on CFOs to learn from others and take advantage of changing times and to look at the market with fresh eyes and consider new opportunities.

My own company, American Express, is certainly witnessing disruption in the payments sector with the rise of contactless and in particular mobile payments. Mobile and digital technology is creating enormous opportunities for us to create deeper and more meaningful connections with customers and the company wants to be at the forefront of this.

For example, earlier this year AMEX announced a partnership with the fitness brand Jawbone in the US which allows our members to make tap-and-pay payments with their wearable fitness devices. In Australia, the company recently formed a partnership with Stone and Chalk, a not-for-profit fintech hub to help accelerate the development of world-leading technology start-ups in the payments space.

For all companies it is imperative a spirit of reinvention is part of their DNA. You have to constantly innovate and challenge the status quo while accepting disruption for what it truly is: an opportunity to exceed customer needs and make your business ready for the future.

Christine Wakefield is Vice President of American Express Global Corporate Payments, Australia & New Zealand