1.
LEADING IN THE NEW: MIDDLE EASTNovember 2018

2.
Advanced technologies’
performance relative to cost is
improving exponentially.
Unsurprisingly, this trend
presents huge value opportunities
The declining cost of advanced technologies
Logarithmic cost index, 2002 = 100
Sources: Accenture Research estimates based on data from: IHS Markit; NY Times; WEF.
100.0
.10
10.10
20.10
30.10
40.10
50.10
60.10
70.10
80.10
90.10
2002 2007 2012 2017
10.0
1.0
0.5
Electric vehicle battery pack ($US/kWh)
Genome sequencing cost ($US/genome)
Cloud storage costs ($US/GB per month)
Global bandwidth costs (US$/1000 MBps)
Global PV module prices ($US/W)
Commercial/military drone minimum prices ($US/unit)
3d printing machines ($US/machine)
EXPONENTIAL TECHNOLOGY INNOVATIONS ARE CREATING ABUNDANT
VALUE OPPORTUNITIES

3.
TrappedValue = % of Economic
Opportunity that is not converted
into Economic Reality, yet
BUT TOO MANY COMPANIES ARE FAILING TO CONVERT THE
OPPORTUNITY INTO VALUE - WE CALL THIS TRAPPED VALUE
Middle Eastern
businesses are finding
themselves being
trapped in the present,
the future or both –
63% are omni-trapped
*
Sources: Accenture Research analysis, S&P Capital IQ
To measure trapped value we analyzed the growth of current operations (Current value) and investor expectations (future value) of 200 of the largest companies by revenue across 18 industries. Time
period of analysis: 2012 to 2017.
Current vs Future Value Consistency
CV and FV Consistency %, 2012-2017, Bubble size represents Average Enterprise Value

4.
+
$442
billion
in Enterprise
Value at risk of
being disrupted
=45% 44%
42% of organizations said they feel unsure or dissatisfied
that their company’s innovation efforts will position them well to
overcome future disruption.The same share concede that their
companies are not prepared for disruption
of companies are highly
susceptible to future disruption
of companies are
experiencing disruption
Sources: Accenture Research analysis, S&P Capital IQ, Pitchbook, World
Economics, OECD, IDC, Variouspublic and governemt sources
Our disruptability framework measures an industry’s current level of disruption by examining two components: the presence and penetration of disruptor companies and the financial performance of
incumbents. To gauge susceptibility, we measure three components: incumbents’ operational efficiency, commitment to innovation, and defenses against attack. To measure these variables, we built
a bottom-up index using data from 200 companies across 18 industries in the UAE and Saudi Arabia. Time period of analysis: 2012 to 2017.
For survey data: n = 150 C-suite executives across 11 industries
~60% of respondents said they expect their
industry to be significantly disrupted in the next three
years
AS INNOVATIVE COMPANIES UNLOCK MORE TRAPPED VALUE, THE
GREATER THE DISRUPTION LEAVING MANY VULNERABLE

5.
Leading companies that
unlock trapped value
BUILD INNOVATION
PROCESSES and ADOPT
PRACTICES that lead to
organizational change.
Our INNOVATION
MATURITY INDEX
measures this
TRAPPED VALUE IS WHY INNOVATION MATTERS IN THE AGE
OF DISRUPTION

6.
56 55
73
Overall
Country
Others Innovation
Champions
Innovation Maturity Index Scores (out of 100)
74
58
Innovation
Champions
Others
Innovate By Design
73
54
Innovation
Champions
Others
Innovation Practices
—6 percent of the sample—
The overall country score on the Innovation Maturity Index was 56 out of 100. But a small group of innovation champions—6 percent
of the sample—averaged 73 points
Sources: Accenture Research analysis based on Leading in the New: Innovation Maturity survey questionnniare
THERE IS A SHARP DIVIDE BETWEEN THOSE ON THE WINNING SIDE OF
INNOVATION AND THOSE BEING DISRUPTED BY IT

7.
MANAGING DISRUPTION LIKE
AN INNOVATION CHAMPION

8.
59
53
58
55 54 52 51
80
69
76 76
71 71
76
Asset
Smart
Technology
Propelled
Data
Driven
Hyper
Relevant
Inclusive Talent
Rich
Network
Powered
21
16
18 21
17 19
25
Others Innovation Champions
72
89
Innovation
Champions
Others
17
58
60
Innovation
Champions
Others
2
49
72
Others
Innovation
Champions
23
Sources: Accenture Research analysis based on Leading in the New: Innovation Maturity survey questionnniare
Innovate By Design Innovation Practices
WHAT SETS LEADERS APART IS THAT THEY UNLOCK TRAPPED VALUE BY
MAKING INNOVATION PART OF THE COMPANY’S DNA

9.
The digital age calls for a new approach to organizational
change that enables companies to
make a Wise Pivot to their new businesses
1. TRANSFORMTHE CORE BUSINESS...
to drive up investment capacity.
2. GROWTHE CORE BUSINESS...
to sustain the fuel for growth.
3. SCALE NEW BUSINESS...
to identify and scale new growth areas at pace.
AWise Pivot also requires the right INVESTMENT STRATEGY to
ensure that the timing, scale, and direction of investments are
calibrated adequately.
Sources: Accenture 2018
CHAMPIONS MANAGE DISRUPTION CONFIDENTLY BY EXECUTING A
WISE “PIVOT” STRATEGY TO THE NEW

10.
The level of current and
future disruption
determines which
strategic action
companies need to
prioritize, today
THE EMPHASIS OF CHANGE ACTIVITIES DURING THE PIVOT DEPENDS
ON THE SEVERITY OF DISRUPTION COMPANIES FACE
Industry Exposure to Disruption

11.
Build sufficient
investment
capacity for change
Enable the organization by
developing a strong
innovation capability
Seek and create
synergies between the
old and the new
55
73
68
81
66
79
Leading companies build innovation processes
and adopt winning practices that lead to
organizational change.
Rotation progress hinges on having investment capacity: 90% of
innovation champions say they have the right level of investment
capacity required to transform the core (vs. 48% of others), grow
the core (vs. 37% of others) and scale new business (vs. 9% of
others)
Innovation champions are focused on tapping into the
potential to cross-sell between the new and legacy
businesses.
90% Innovation champions consider the potential to
leverage new business in order to reshape the culture of the
legacy business (vs. 51% of others).
PRECONDITIONS ROTATION SCORE
Innovation
Champions
Others
Innovation
Champions
Others
Innovation
Champions
Others
Sources: Accenture 2018
1
2
3
TO PREPARE FOR THE WISE PIVOT JOURNEY, CHAMPIONS CREATE
THREE PRECONDITIONS TO REINVENT THEIR ORGANIZATIONS

12.
END