Accenture: China's “rotation champions” outperforming peers

China's "rotation champions" are outperforming their peers in all industries, according to Accenture (Image erhui1979 / iStockPhoto)

An elite 7% of Chinese companies have become “rotation champions”, generating more than half of their revenues from new businesses started in the last three years, according to new research from Accenture.

The China Digital Transformation Index report published by the professional services company finds that Rotation Champions invest heavily in scaling up new tech-enabled businesses while driving continuous transformation of the legacy business.

These rotation champions outperform their industry peers by generating around 5.5 times greater growth rate than their industry peers, with an average compound annual growth rate of 14.3% over three years. They also secured a sales margin of 12.7%, compared to 5.2% for their less agile peers.

Rotation champions are spread across all eight industry sectors covered in the research, but the automotive and consumer electronics sector are ahead of the pack, followed by the logistics and the retail industries. The metal, chemicals, pharmaceutical and fast moving consumer goods sectors are meanwhile behind the curve.

But most companies are far behind the rotation champions in terms of building digital capabilities, Accenture said.

The report found that to become a rotation champion, companies must focus on five priorities as they build their digital capabilities, including establishing top-down ownership to ensure senior executives are tasked with driving the digital transformation agenda.

Companies should also become aggressively customer centric by becoming a “hyper relevant brand” capable of addressing customers' changing needs. Another priority should be leveraging ecosystems by taking advantage of carefully managed partnerships.

Accenture also recommends that companies leverage cloud solutions, data infrastructure and AI to become “data propelled”. Finally, companies should seek to transform their workforce to build a specialized, agile organization.

“The Rotation Champions are well ahead of the rest, signifying that there’s a gap when it comes to how companies are investing in digital capabilities,” Accenture Greater China chairman Wei Zhu said.

“To close the gap, companies should invest in and deploy digital technologies at scale and at speed, and they must seek to create an agile organization with an innovation culture that will allow them to monetize new ideas.”

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