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Hackett Key Issues Study Identifies Ways Companies Are Coping With Volatility

March 16, 2012

Has your company spent the last few years adjusting to a “new normal?”

For many firms, the answer to that question is an unequivocal “yes.”

Without a doubt, pressures from the global economy have transformed business practices throughout the enterprise, and recently released key issues research from The Hackett Group confirmed that many large companies are adapting to a new status quo characterized by increased volatility and uncertainty in:

  • demand,
  • cost of raw materials and energy, and
  • availability of talent.

In fact, nearly one in five companies in The Hackett Group’s 2012 study said they expect to see 25 percent or more volatility in these areas over the next two to three years.

How will companies adapt? The research shows that many companies are focusing on:

  • improving the accuracy and timeliness of information to enable improved decision-making,
  • leveraging global standards, resources, and organizational models, and
  • understanding how each region should operate while still gaining the advantages that come from a global process operating platform.

Despite the global unpredictability, this study also confirmed that revenue growth and improved operating margins remains a priority, and that the predominant opportunities for revenue growth lie in emerging markets outside of Europe and North America. In fact, as The Hackett Group points out, the International Monetary Fund now estimates that 61 percent of global GDP growth in 2012 will come from Brazil, Russia, India and China.

Of course, pursuing deals in emerging markets is a double-edged sword. On the one hand, geographic barriers to doing business have been dramatically reduced, making globalization a principal opportunity to most organizations. On the other, these deals are inherently more risky, as well, and many companies face trouble with partnering, direct government interference, problems with financial information and non-compliant business practices.

More details are available in The Hackett Group’s Research Insight, 2012 Key Issues Agenda: The ‘New Normal’ Has Become the ‘Now Normal. (Registration required).

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