‘Chief Strategy Officers’ – or CSOs as we normally say – have long been the Swiss army knife in many organisations: well positioned to solve ambiguous problems by taking on a variety of responsibilities, and with a line of sight into many different functions. For the fourth iteration of Deloitte’s international CSO survey, we have surveyed respondents from 20 countries, coupled with a large number of in-depth interviews.
I think this kind of research is important and interesting. It sheds light on how the strategy function and the CSO role have evolved over time – and the proactive steps organisations are taking to keep pace with the shifting market.
So what are we seeing in 2023? Well, first of all, the strategy function and the CSO role are constantly modernising and evolving. Many CSOs play a key role in guiding organisations towards growth and profitability and in building resiliency. As organisations continue to adapt and re-configure for success, we are experiencing structural and fundamental changes in their strategy functions as well. Overall, they are becoming more formalised, larger in headcount size, more agile and more dynamic.
We are also seeing CSOs increasingly working beyond their organisations. As companies race to meet customer needs with the most convenient and holistic solutions, many CSOs are taking a business ecosystem mindset toward value creation and capability expansion, thus removing the constraints of traditional market boundaries and opening up new opportunities for growth.
Big difference between thriving and struggling organisations
According to the survey, there are clear differences between top-quartile and below-industry-average organisations in where CSOs focus their time and how they operate.
CSOs in top-quartile organisations are generally allowed to focus their efforts on bolder bets and tougher challenges. Given their position at the intersection of strategy and execution, CSOs possess a holistic view of the business that is crucial to the process of adopting advanced technology and infusing it into the business model. CSOs at top-quartile organisations generally also have the bandwidth to incorporate green and socially responsible practices into their organisation’s strategy. Many are already working purposefully and innovatively with the ESG agenda as a source of long-term competitive advantage.
In contrast to this, CSOs in below-industry-average organisations are typically turning their focus inward to find new avenues of growth while also “getting their house in order.” This includes looking for ways to increase efficiency and improve margins, but also reinventing the current business and operating models in cases where the company suffers from industry disruption, internal complexity or market slowdown.
Combining strategy and execution
My personal take on all this is that whether you are in a thriving or a struggling organisation, today’s strategies must be much more closely aligned to execution than before – and that close collaboration between the CSO and COO is needed to make this happen.
Looking at our 2023 survey, I am pleased to see that compared to just a few years ago, many CSOs have now moved away from a solely centralised strategy model to a more holistic model, operating BOTH at the enterprise level and at the business unit and functional level. This approach, which has seen a 15 percentage-point increase in prevalence from 2021 to 2023, enables CSOs to better balance their role at the intersection of strategy and execution – and to drive business success through co-creation and collaboration.
What it also means is that, with increasing volatility and uncertainties, more and more organisations are transitioning away from 5- and 10-year plans to dynamic strategic planning where strategy development is continuously translated into execution. In my view, this is a great trends, because the connectivity reduces execution risks and the tendency for strategies to remain academic versus tangible and executable. It also allows CSOs to maintain a strong network across the organisation, including the COO area, to keep a better pulse on the inner workings of the organisation and achieve greater buy-in at all levels.
New challenges ahead
In conclusion, I think it is fantastic that more and more CSOs get pulled in to support, lead or shape a wide range of strategic and operational topics. In many companies, CSOs and their strategy teams have proven crucial to resilience and success. Their cross-functional mindset and natural inclination to growth enable them to tackle today’s unpredictable environment and tomorrow’s challenges.
In the coming 12 months, I am sure Danish and Nordic CSOs will take on many new challenges: Social impact and sustainability, improved customer experience, tech modernisation and next-gen tech, talent retention, enterprise resilience, cost reduction, new business incubation and operating model transformation – just to name a few examples.
And as they do so, they are transforming and evolving the strategy function to best operate in this ever-changing landscape, becoming more nimble, interconnected and innovative. Many CSOs have an influential seat at the table today, but to hold onto that position, they must continuously evolve their role – adapting at the same pace as, or a step ahead of, the rapidly changing world in which they operate, which I am sure they will.
As a part of the Strategy & Operations practice Tore has worked with analysis, development and implementation of operational strategies. Tore has deep experience with aligning business models to changing market demands through optimisation of business processes and aligning systems, organisation and governance accordingly. He has industry experience from manufacturing, transportation, consumer products and energy. His main focus is on on the operational core processes but he also covers administrative support processes. As a program manager Tore has been leading transformation projects for international clients heading multiple parallel projects and reporting directly to executive committee members. His responsibilities cover everything from initiating assessments, identifying opportunities for improvement to building business cases and following up by designing solutions and driving teams through implementation.