DALLAS, Dec. 3, 2019 /PRNewswire-PRWeb/ -- Based on a November market survey of enterprise executives, Everest Group predicts that uncertainty will rule supreme in 2020, despite current positive market conditions and better-than-expected enterprise performance in 2019.
With 2020 fast approaching, Everest Group polled 130 senior enterprise stakeholders from Global 1000 companies on their thoughts about growth prospects, investment priorities and challenges they expect for the new year.
The good news from the study: Senior enterprise stakeholders ended 2019 with a slightly more optimistic sentiment about their 2019 performance as compared to their original expectations for the year. Forty-three percent of respondents indicated they had a slightly better than expected (32%) or fantastic (11%) year.
The bad news: Despite positive market conditions that should be creating certainty and high optimism for 2020 — such as historically high stock market, low unemployment, and low interest rates ― market UNcertainty continues to create a drag on industry optimism. In fact, Everest Group reports that organizations are bracing for slower growth in 2020.
Only 45% of enterprise executives surveyed this year are optimistic about growth in 2020, as compared to 57% who expected growth in 2019. Twenty-eight percent of enterprise executives interviewed this year expect flat performance or even a decline in 2020, an increase from 22% who held a negative outlook for 2019.
Whereas enterprise executives projected 2019 revenue growth of 7.6% and headcount growth of 5.1%, executives today project lower growth rates for 2020: 5.4% revenue growth and 3.9% headcount growth.
Based on responses to questions about investment priorities and challenges anticipated for next year, Everest Group predicts that 2020 will be the year when three major trends gain momentum:
1. Customer experience is king. Forty-five percent (45%) of respondents selected customer experience as the top investment priority and the most critical change that must be made in their business model. This remains true even in an economic downturn. When asked to identify top investment priorities for 2020 should the economy strengthen versus if the economy weakened, senior enterprise executives typically had two very different lists, except for their top priority—customer experience—which remained the same for both scenarios.
2. Enterprises do digital and data, or die. Enterprises either learn to do tech or fall too far behind to survive. Rapid technology advances are a key lever to improving customer experiences. To that end, analytics, cloud solutions and automation (RPA) rank highest (in that order) among the capabilities enterprises most seek to develop.
3. The contingent workforce becomes a powerful force for change. A shortage of next-generation skills remains a huge challenge for enterprises. Organizations must treat the contingent workforce not as an inconvenient fringe element in their businesses but as a strategic asset. The contingent workforce is a key part of the labor pool in many organizations, especially for groups like IT. In fact, Everest Group research indicates that 36% of enterprises classify more than 16% of their workforce as contingent workers, a workforce segment that is increasing in size and scope.
"Despite the uncertainty facing enterprises in 2020, the opportunity to win remains, and the stakes to capitalize on the right investments are higher than ever," said Michel Janssen, chief research guru for Everest Group. "For example, we know that digital transformation is a key investment priority, and rightly so. However, even the best companies are still unable to take advantage of the dizzying array of new digital technologies – and the gap grows for the rest. We'll see the same dichotomy play out in the areas of customer experience and contingent workforce as well. Those who invest and successfully execute will be few, and the rest will lag behind. Should the uncertainty and slow growth that enterprise executives predict truly bear out in 2020, the gap between leaders and followers will be all the more pronounced."
***WEBINAR: Thursday, December 5, 9 am CST. ***
The results of this research will be presented by Janssen and Eric Simonson, managing partner at Everest Group, during a complimentary webinar on Thursday, December 5, at 9 am CST. The webinar — "2020 Enterprise Key Issues in Global Sourcing: Setting Course When Uncertainty Rules Supreme" — will cover:
- Common sentiments expressed by enterprise executives during Everest Group's recent market survey on enterprise key issues
- Leading implications for enterprises engaged with service providers and key value propositions to consider for both insourcing and outsourcing
- Potential enterprise adjustments around service provider portfolio consolidation, deal size, and value realization
Register here: 2020 Enterprise Key Issues in Global Sourcing: Setting Course When Uncertainty Rules Supreme.
About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. We are trusted advisors to senior executives of leading enterprises, providers, and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empowers clients to improve organizational efficiency, effectiveness, agility and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at http://www.everestgrp.com.
SOURCE Everest Group
Share this article