New business models

New business models
New business models
How US CEOs are reshaping business models

 
Michael Roth,
Chairman and CEO, Interpublic Group
US CEOs are on a hunt to uncover untapped value in their businesses and industries. They are ready to make big changes.
New business models are the output of innovation

The central challenge for US CEOs today is the increased likelihood that an emerging rival is no longer a well-understood competitor. That changes everything, signaling above all that the economics of the business are evolving.

The answer is to innovate. More than a third of US CEOs say new products and services now offer the main opportunity for growth for their companies in 2014. The app economy, the e-Bay economy, the sharing economy have broadened the view of just where and how all companies create value.

 
William Nuti,
Chairman and CEO, NCR Corporation
CEOs in four largest economies bank on innovation for growth in 2014
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Michelle Wilkes
Financial Services Strategy Leader
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Rob Shelton
Global Innovation Strategy Leader
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José E. (Joe) Almeida,
Chairman and CEO, Covidien
Effective use of technology is going to be a crucial factor

CEOs are seeking to spur greater innovation and differentiation as business models evolve. Applying digital technology in the life insurance markets, for example, is leading towards more flexible assisted and self-directed models for buying policies. And making better use of the insights that the ensuing data can provide will support new rounds of innovations and market reach.

Mainstream US enterprises are scratching the surface on marketing and customer insight tools and where to take mobility technologies next. Next up: ubiquitous sensors and embedded computing look to herald another wave of new products and services.

CEO perspectives


John Haley,
Chairman and CEO of Towers Watson
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“Among competitors, I worry mostly about organizations we’ve never heard of, that come in with new technology, a new way of doing things and a disruptive approach. Those are the things that cause me to lose sleep at night.”


John Haley,
Chairman and CEO of Towers Watson
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“Healthcare, particularly the changes that are coming in the US, is going to have a major effect, not just on the economy, but on our healthcare consulting business too, in particular, our exchanges. It’s the single largest business opportunity that I’ve seen in my lifetime.”


Daniel B. Hurwitz,
CEO of DDR
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“The thing we have prioritized more now than ever is making sure that we’re not just doing deals with retailers… We used to just talk about space. Now we’re getting a deep-dive look under the hood to understand where merchandise is going, where store planning is going, where design is going, and how we can adjust for the future.”


Michael I. Roth,
Chairman and CEO, Interpublic Group
Watch the video

“We just have to be ahead of our competition in new technology, in servicing and providing an integrated offering for clients that enables them to reach the consumer in ways they want to be reached. It’s not the 30-second TV spot anymore. It’s mobile, it’s tablets, it’s all the different ways the consumer communicates now in the marketplace.”


Dinos Iordanou,
Chairman and CEO of insurer Arch Capital Group Limited
Watch the video

“All these technological breakthroughs allow us to have not only the ability to assimilate information faster and analyze it faster, but also to have access to that information and distribute this knowledge-based product called “insurance” to the customer. That’s the new innovation, in my view, and companies who don’t spend time and resources will be left behind.”

“Among competitors, I worry mostly about organizations we’ve never heard of, that come in with new technology, a new way of doing things and a disruptive approach. Those are the things that cause me to lose sleep at night.”
John Haley, chairman and CEO of Towers Watson

“Healthcare, particularly the changes that are coming in the US, is going to have a major effect, not just on the economy, but on our healthcare consulting business too, in particular, our exchanges. It’s the single largest business opportunity that I’ve seen in my lifetime.”
John Haley, chairman and CEO of Towers Watson

“The thing we have prioritized more now than ever is making sure that we’re not just doing deals with retailers… We used to just talk about space. Now we’re getting a deep-dive look under the hood to understand where merchandise is going, where store planning is going, where design is going, and how we can adjust for the future.”
Daniel B. Hurwitz, CEO of DDR

“We just have to be ahead of our competition in new technology, in servicing and providing an integrated offering for clients that enables them to reach the consumer in ways they want to be reached. It’s not the 30-second TV spot anymore. It’s mobile, it’s tablets, it’s all the different ways the consumer communicates now in the marketplace.”
Michael I. Roth, chairman and CEO, Interpublic Group

“All these technological breakthroughs allow us to have not only the ability to assimilate information faster and analyze it faster, but also to have access to that information and distribute this knowledge-based product called “insurance” to the customer. That’s the new innovation, in my view, and companies who don’t spend time and resources will be left behind.”
Dinos Iordanou, chairman and CEO of insurer Arch Capital Group Limited

New approaches to innovation and R&D

To accelerate innovation internally, some are funding innovation incubators to foster rapid prototyping of new ideas. The recent recovery in corporate venture capital—typically small equity investments in start-ups—underscores the innovation commitment to widen access to new technologies. Others are looking to join up with emerging market innovators who are developing low-cost products that can find their way into global markets.

 
David Thodey,
CEO, Telstra (Australia)
Business implications
  • Re-think how you participate in your industry, not just with the end customer but with suppliers and other participants, too. Potential partners can crop up from different places.

  • Support new technologies and keep the end game on digital integration. Social, mobile, analytics, and cloud technologies are underpinning the creation of new business models. Customer-facing technologies will compete with internal IT projects, and thus risks increase that applications created by third parties and championed by marketing, sales, or other functional leaders will drive a wedge with the IT organization as well as create data assets that exist in silos. This can blunt the impact that a truly digitally integrated enterprise provides.
Connect with our leaders
Michelle Wilkes
Financial Services Strategy Leader
Tel: +1 (267) 330 6005
Rob Shelton
Global Innovation Strategy Leader
Tel: +1 (408) 817-4251