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Transformation through transactions: How innovative investment strategies are helping CEOs embrace disruption

Transformation through transactions

CEOs have powerful tools when they face today’s business environment: deals, partnerships and divestitures give one agility without the upheaval.

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CEOs need grit to face the toughest headwinds of today's business environment: disruption from new market entrants, new products and new customer expectations - all enabled by continually developing technologies. According to a new KPMG report, CEOs have a powerful tool at their disposal: investment strategies.

Transformation through transaction: How innovative investment strategies are helping CEOs to embrace disruption explores the issues specific to investment strategies uncovered in a survey of 1,200 CEOs.

The report confirms that companies can minimize disruption and hedge their bets on what future business models will look like by investing in strategic partnerships and corporate venturing. In addition, divestments will become a more significant part of the transformation agenda and these will require the same strategic insights as the acquisition process.

Key findings from the report include:

  • 3 out of 10 CEOs surveyed say they are pursuing partnerships/joint ventures as a way to expand their businesses through growth and innovation in a shifting business landscape.
  • Corporates are becoming increasingly involved in early stage investment, which are becoming increasingly important sources of capital and talent as well as exposure to relevant technologies.
  • Divestments are no longer a result of underperformance. Looking ahead, it will become more commonplace to divest only certain parts of a business, which will be taken as a sign of a board that is managing a successful portfolio.

Referencing these and other survey insights, the report finds increased use of data analytics and establishing a clear vision will enable companies to make the right strategic investments early to more effectively address future sources of disruption.

© 2018 KPMG Advisory, a Belgian civil CVBA/SCRL and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. All rights reserved.

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