Forget scattered pilot projects and marginal process improvements. Amid constant disruption, execution at scale is a strong predictor of success. Companies should consider rethinking their organizational structures and focus on a smaller number of big, bold moves, rather than many incremental adjustments.
This insight is a central finding from a new body of KPMG research that explores how organizations can build the capabilities needed to perform through ongoing uncertainty. At the center is the KPMG Adaptability Index, a data-driven framework that points to balanced efforts across an organization’s culture, strategy, and broader ecosystem of partnerships, alongside efforts to build structural readiness as the most effective approach to building adaptability. Complementing the Index, the KPMG quarterly Adaptability Pulse Surveys assess how organizations are responding to pressure, including the degree of proactivity behind those actions and the results they deliver.
Executive summary
To achieve strategic adaptability, leaders need to invest in tools and processes that allow them to make fast, confident decisions under conditions of uncertainty.
The KPMG Adaptability Pulse Survey of 1,120 executives reveals a counterintuitive truth: the actions that organizations take in response to disruption may matter less than how effectively they are executed. The watchwords are scale and focus.
Fewer focused actions, delivered with clear purpose and decisive leadership, are likely to outperform fragmented, reactive approaches. KPMG research shows that it is not the number of strategic options pursued, but the thoroughness with which they are executed, that determines effectiveness.2 Instead of spreading efforts thinly across many smaller initiatives, organizations can achieve better outcomes by adopting strategies centered on bold, proactive transformation.
Execution scale is a strong and consistent predictor of effectiveness across disruption responses.2 Organizations that implement changes at enterprise-wide scale report higher effectiveness. Eighty-three percent say they fully or mostly achieve intended outcomes, compared to 28 percent among those pursuing incremental approaches.2
KPMG Point of View
Strategic adaptability requires leaders to simultaneously manage near-term pressures while positioning for long term shifts and re-evaluating strategic priorities. In the face of disruption, leading organizations should commit to fewer, bolder moves and execute them at enterprise scale with discipline, leadership clarity, and aligned operating models. Drawing on insights from the KPMG Adaptability Pulse Survey, we believe that companies who act with clarity and conviction are best positioned to thrive amid uncertainty.
Percent of intended outcomes fully/mostly achieved
Across every disruption response assessed, more than a quarter of executives rate their organization’s responses as not or only partially achieving their goals.2
Our research indicates a preference for incremental adaptation over full-scale reinvention.2 Improving speed and agility ranks lowest among organizations’ responses to disruption. Strategy changes also rank on the lower end, likely due to legacy systems and structures. For greater success, companies can shift toward more flexible, dynamic structures encompassing a focus on innovation, customer experience, and strategic partnerships to enable swift pivots.
Historic responses are likely no longer adequate. Scenario planning, for example, is ranked as the least effective approach, despite being used widely for years.2 Nearly half of executives say that scenario planning leaves them with wholly or partially unfulfilled objectives.2 To ensure scenario planning delivers tangible results, organizations must proactively revisit and adapt their strategies in step with shifts across their operating environment, transforming planning from a static exercise into a dynamic tool for action.
46%
Conducting scenario planning or rapid-response processes
45%
Adopting new data or decision-support tools
42%
Changing performance metrics or KPIs
40%
Shifting decision-making authority closer to the front line
Key insight: Scenario planning is still viable, but must be continually re-evaluated, updated, and activated as the broader ecosystem evolves.
KPMG research on adaptability indicates that implementing discipline and focus is a key to building stronger strategic adaptability. Here are some actions that can help you get there.
Optionality often leads to fragmentation. Excelling amid disruption requires commitment to a few bold actions executed at scale—a shift the research reveals is a strong predictor of success.2 Consider strategic responses the organization can rally around. Clearly communicate a top-down vision and a narrow agenda of priorities. When everyone understands and works toward a shared purpose, momentum builds quickly. Commit to scale and rapidly ramp up initiatives with the potential for success.
Strategic procrastination is a danger in a disruptive environment. While organizations are cautiously making small, incremental changes, competitors are making the bold, scalable moves that are likely to capture the market. Leaders shift from analysis to action and have the courage to build and test their own disruptive models.
Rob Fisher
Advisory, Vice Chair, KPMG US
Effective execution begins with leadership clarity. Don’t ask, “Which action should we take?” but “Can we execute this action well enough to make a real impact?” Execution at scale in response to disruption is a strong predictor of success. Divided leadership, lack of ownership, or half-hearted commitment are more likely to lead to failure. When responsibility is shared by more than one individual, or the work is done part-time alongside the day job, it sends the signal that this doesn’t truly matter. Lastly, if an initiative is likely to be suspended if business performance weakens, it probably wasn’t truly strategic.
Whatever direction an organization chooses, disciplined execution is a critical factor. This commitment doesn't emerge from planning; it emerges from codified organizational practices that ensure follow-through. When a major initiative kicks off, people may attempt to attach their pet projects, risking dragging it down. Define the scope tightly and put gating processes in place, so any additions can be rigorously assessed. Establish clear KPIs for tracking initiatives. In addition to hard metrics, pulse surveys can provide insight into employee understanding and buy-in.
When structures and systems are misaligned, meeting the growing demand for adaptability is challenging. Yet, our research suggests that many organizations respond to disruption within existing operating and strategic frames, rather than fundamentally reevaluating how they are organized or where they compete.2 Specifically, only 30 percent of executives say they strongly agree their organizations have structures and processes designed for rapid reconfiguration.1
This gap suggests that organizations may be better equipped to respond to disruption by establishing strong organizational discipline and clear decision-making channels that can enable swift, decisive action. At the same time, those that do attempt to overhaul management systems and existing structures in the core business may face organizational friction that slows down vital strategic initiatives.
Organizations may find more success by pursuing relatively radical initiatives within parallel structures. Spin-out businesses are more likely to work at speed and deliver agility and innovation at scale. Through a two-track approach, organizations can raise the likelihood of being able to act with speed and avoid bottlenecks, while spin-out teams may find they have the space to reimagine the business for the future, with fewer of the constraints associated with the existing model.
Executing boldly at enterprise scale requires a foundation comprising a scalable data infrastructure, embedded security-by-design, and compliance frameworks that enable rather than inhibit change. Particularly in regulated industries, organizations that can execute at scale have already established the governance, risk management, and operational discipline to support rapid and robust deployment.
While strategic acquisitions can drive growth, they can also create internal complexities within critical functions like procurement.
By completing massive, transformative acquisitions—most notably its merger with DuPont’s Nutrition & Biosciences business and the acquisition of Frutarom—IFF vastly expanded its portfolio, but also significantly complicated its procurement processes.
Read moreIn the face of compounding disruption, building adaptability is becoming an urgent priority. Organizational focus and scale are among the most critical factors for success. As you seek to thrive in these uncertain times, ask yourself: How adaptable is your organization? How will your execution model perform versus the competition? Are your disruption strategies delivering? And, critically, do you have the data infrastructure, security foundation, and operational discipline to execute boldly without introducing unnecessary risk?
At KPMG, our experienced teams understand the pressures your organization is facing, whether it’s supply chain volatility, rapid technological shifts, or the need for strategic adaptability in challenging times. We help you rethink your approach to disruption, anticipate emerging challenges, and execute change at scale—empowering you to make confident decisions that drive sustainable growth. Let’s start a conversation about how your business can thrive amid uncertainty.
