IBM Study Customer activated Enterprise

IBM Study: ASEAN C-suite Leaders Recognise the Role of the Digitally Active Customer in Driving the Business Agenda

 Customers become the “new” business advisors to the C-suite;

90 percent of senior leaders expect extensive collaboration with customers within the next five years

IBM Study Customer activated EnterpriseBangkok – 15 May 2014: IBM (NYSE: IBM): IBM’s Institute for Business Value new study, entitled “The Customer-activated Enterprise,” is based on findings from face-to-face conversations with more than 4,000 CEOs, CMOs, CFOs, CIOs and other C-suite leaders from 70 countries and 20 industries worldwide including 75 CxOs from ASEAN, who represent a wide range of public and private-sector organisations, covering more than 12 industries.

ASEAN CxOs interviewed said that market and technology factors are seen as the two most important external forces impacting the enterprise in the future. Like their global counterparts, they foresee major changes in the next three to five years, expect to open up their enterprises, look to partners to have an equal hand in creating business value, and recognize the new imperative – a shift to social and digital interaction. The Study also found that ASEAN CxOs are far more likely to adopt a more open approach to running their organisations than the rest of the world with 78 percent seeing a bigger partner network. (Globally this percentage is 73 percent.)

Mrs. Parnsiree Amatayakul, Managing Director, IBM Thailand Company Limited, said, “across the globe, CxOs may vary in their views about which external pressures are most significant. However, all agree that technology is one of the top three pressures. Digitisation has given customers far more clout and transformed their expectations. In 2014, we expect the digitally active customer to move to the top of the C-Suite agenda”

“Overall, ASEAN companies now well realise that knowing the customer well and how to serve them better, in a way tailored to their needs and preferences, is the key to enduring and meaningful client relationships. However, many continue to struggle in order to transform their organisations and the mindset of their customer-facing employees fast enough in order to succeed. It is as much a change management and behavior challenge as it is a technology challenge to properly adapt to changing market and customer expectations.”

The Customer Activated Enterprise

The IBM report uncovered a key correlation between the companies that succeed and their levels of external collaboration. Outperforming companies are 54 percent more likely to open themselves up to customer influence and collaborate extensively with customers.

ASEAN CxOs we interviewed recognised that customer-decided needs were key in retaining their loyalty. By better understanding what the customer wants and by creating an end-to-end and consistent experience across all channels, enterprises will be better placed to respond to changing customer needs.

“In the telecommunication industry where every second means a change in technology, the dynamic customer demand drives operators up to the teeth competing for the fastest serving of the next innovation. But while we are up for technological readiness, what sets dtac apart from other brands in the market is our customer centric mindset. Furthermore, we take customer’s feedbacks earnestly and engage them in our product, service, and business process innovation,” said Mr. Jon Eddy Abdullah, Chief Executive Officer, Total Access Communication PLC or dtac “dtac has transformed its Billing systems, its Business Intelligence Systems, its Service Delivery Platforms and its digital customer touchpoints, which all enable the organization’s long-term capability to better serve active digital customers and create sustainable value to our shareholders aligning to our business strategy called Loved by Customers’

CEOs Share Control

46 percent of ASEAN CxOs agree that customers today exert considerable influence on enterprises, and they recognise the need to rebalance priorities to better suit the changing expectations of their customers. Globally, we have found that 54 percent of the CxOs interviewed hold the same view. In ASEAN, however, this does not translate into deeper collaboration with only 36 percent agreeing that they do collaborate with their customers, compared with 46 percent of their global counterparts. Deep collaboration is nonetheless a shared goal with 91 percent of ASEAN CxOs expecting to better engage their customer in three to five years time. They also recognise the need to rebalance priorities even as the expectations of customers change.

Closing the Customer Intimacy Gap

A new era of connectivity, massively available user-generated information and the mandate for open, ongoing communication is demanding new levels of transparency across an organisation. Business leaders recognise that customers are already influencing their organisation, and they are breaking down internal and external barriers to open up new paths of collaboration, innovation and growth.

Recognising the impact that technology continues to have on how enterprises operate and engage with their customers, companies are activating their customers by pioneering new digital-physical innovations. By blending their digital and physical strategies, companies can deliver an integrated approach to meeting the needs of their technology-empowered customers. Our Study found that ASEAN organisations (45 percent compared to 36 percent globally) are slightly further along in terms of developing an integrated digital-physical strategy than the rest of the world. Globally, the biggest challenge for 63 percent of those interviewed, is the lack of a cohesive social media plan when implementing a digital strategy. In ASEAN, the barriers are a little more specific, with legal and security concerns playing a much bigger role in limiting digital initiatives within ASEAN organisations than they do worldwide (54 percent compared to 38 percent globally).

While CxOs drive various initiatives to improve the customer experience, many struggle to be successful with social business. Seventy-nine percent of those interviewed are quick to respond to emerging trends but only 37 percent engage customers via social business. Similar numbers are seen in ASEAN, where enterprises are more focused on delivering consistency as the primary means to create a positive customer experience. Twenty-two percent of ASEAN CxOs (compared to 35 percent globally) recognise that they do not understand their customers well at all today, yet anticipate significant improvements going forward. Like their global counterparts, about four-fifths of them expect they will better understand their customers in three to five years time.

Both CMOs and CIOs overwhelmingly indicate that they intend to make great strides to overhaul and reinvent the way they work with their customers. In 2012, 57 percent of CEOs expected digital channels to become one of their company’s key means of interacting with customers within the next five years. In 2013, 52 percent of CxOs say they are already there. Like their global counterparts, ASEAN CxOs intend to interact digitally with customers to a much greater extent in the future – 52 percent do so today and they expect to reach 88 percent in three to five years.

About the IBM 2013 Global C-Suite Study

IBM conducted its in-person analysis with more than 4,000 C-suite leaders by using a global team of business strategists, consultants, data scientists and statisticians. Also for the first time, IBM Watson — IBM’s groundbreaking, cognitive system — was used to draw additional inferences from the study data.

For more information about the IBM Institute for Business Value (IBV):

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