New Zealand CEO Survey 2017

Interview with Mark Averill

Chief Executive Officer PwC New Zealand

"...we shouldn’t underestimate how hard transformation is for established organisations who have always operated in a pre-digital world."

As CEO of PwC New Zealand, Mark leads a team of more than 120 partners and over 1,300 staff, who are focused on building trust and helping New Zealand businesses solve their most important problems.

Mark’s eye is firmly on the changing business landscape. He’s focused on bringing what’s happening globally to the fore in New Zealand and making these developments relevant for New Zealanders and our economy. With significant people leadership experience, Mark grows and develops leaders who are relevant for the future – creating leaders who catch the wave of change first and connect New Zealand to the world stage.

In our conversation with Mark, we discuss how he sees technology changing the way we work, and how digital trends are impacting the way we build and maintain trust in organisations.

PwC: What do you think has been the most significant change you’ve seen through businesses over the last 20 years?

Mark: I think it’s very hard to look beyond technology and how it’s influenced the way we operate.

Technology means that the world has become a far smaller place and we are all working in an increasingly global environment. In New Zealand in particular, it’s far easier for us to participate on the global stage.

Technology has also had a massive impact on the speed we’re all expected to operate at. From our perspective at PwC, our clients expect us to be instantly available and have the ability to access both people and information globally. It is transforming the way we work.

PwC: Is there a threat there as well that companies are facing new market entrants that might not have bothered with New Zealand before?

Mark: I think inevitably yes; but I think it is still a net positive. While it allows us to participate on a global scale – which is a big opportunity – you might have a little more competition. However the net positive is very much the outbound opportunity for New Zealand companies.

In particular, I think the people who have positioned themselves well for the future have probably got an ability to outperform both global growth rates and domestic growth rates.

PwC: We’re seeing New Zealand organisations become more collaborative with other firms, how do you see that playing in to their growth plans?

Mark: There is an increasing appetite for people to partner with other companies to work together. You’ve got to be willing to work with other people and other companies if they have the complementary skills your organisation needs.

That may also mean working alongside your competitors, if they have those complementary skills to help your business. It’s something we’re seeing locally, from our big banks working together on cyber security to the apple industry collaborating on locally developed apple varieties. We’re seeing it more and more and that is where the world will keep moving to in the future.

PwC: So what do you see as the threats or opportunities that businesses are facing going forward?

Mark: I think the answer is we are facing many more threats, more than we have in the past. A lot of them stem out from more uncertain economic and political times, coupled with the impacts of technology and the different way that people need to operate.

I think that every CEO has a natural desire to project growth in their own business. However the environment is going to provide challenges on people to execute those growth plans. The opportunities are there, but they come with plenty of new risks.

I also think there is an evolving social aspect as well. Looking at it from a NZ perspective, we are facing a skills shortage and that’s linked to housing affordability in Auckland. Those are things that have always been around but are becoming more pronounced.

New Zealand is also a changing country. We’re increasingly becoming an Asian country – thanks to our proximity to Asia and the degree of immigration we’ve seen in recent decades. That’s a big change, but it’s also a huge opportunity.

PwC: Speaking of threats, cyber security is a major challenge for a lot of companies. Do you see that concern in the conversations you have with other business leaders?

Mark: Yes I think so. Cyber security is one of those waves of change that has come from new technology. Cyber security’s been a big wave of change, but it’s not the only one that companies have to be ready for.

PwC: You mentioned how technology is making us all more accessible at work – we’ve also seen flexible working become more popular thanks to technology. How do you see that relationship between people and technology playing out?

Mark: It’s inevitable that tech is changing the lives of employees and, again, I do see that as a net positive because it’s unlocked things like flexible working. It has made us more contactable and increased the expectation that people will respond quickly to emails, for example. But those negative implications are outweighed by the positive.

Another benefit of technology has been to younger generations of employees. Young people, who are able to embrace technology and can identify opportunities using critical thinking, are able to stand out much earlier in their careers. That confidence that many young people have around technology is certainly giving them an advantage in the workplace and gives them a seat at the table, because they can show that they are making a difference.

PwC: And how do you see automation playing in to this?

Mark: There are many aspects of what we’ve done at PwC In the past that have been changed – or challenged – by the introduction of technology. That has certainly included automation, particularly automation of tasks, rather than entire roles.

At PwC, it’s our goal to keep providing insights and have relationships with our clients so that we can help them solve important problems. Now, you can’t automate that because it’s something bespoke. You can automate tasks to a level but in order to add value you do need to provide an insight which is relevant to the situation and that needs to be an individual perspective. Everything can’t be bored down to automation when you are looking to advise people.

Automation is also a positive opportunity for staff, particularly junior staff, because it means that junior staff aren’t having to perform low-skill, repetitive tasks that could be automated. That gives them an opportunity to move faster into more insightful and value-adding work early in their careers.

PwC: How do you see technology affecting the role of the CEO? Because being a leader also seems to involve a lot more time spent in the digital space?

Mark: Absolutely. Again it’s about getting fit for the future. Digital is part of the everyday expectation that we now have of CEOs. Being relevant for the future means you need to embrace social media and embrace working in a digital way.

However I also think that we shouldn’t underestimate how hard transformation is for established organisations who have always operated in a pre-digital world.

PwC: Obviously technology is having a huge impact, how do you think that’s affecting how businesses gain and keep trust? Do you think it is more difficult for companies as they automate more and more of their operations?

Mark: First of all I would say that trust is absolutely critical. When you look at it from a PwC perspective, you come back to what we stand for: we want to build trust in society and we want to help solve important problems. So it is absolutely critical that PwC is seen as trusted.

We are still in a transition period where there are the older generation who take far longer to get comfortable with digital, making internet banking payments online etc. compared to the younger generation where they’ve probably never paid with anything else. I can see this from my parents’ generation, internet banking and all that sort of stuff where we think nothing of it.

The reality is that there are also some massive risks around new technology that will affect how we are perceived. So it’s critical we have trust because without trust digital transformation is going to slow down and not be successful.

PwC: There’s also a people element to that trust, isn’t there?

Mark: Absolutely. Flexible working is a great example of that trust you have to have in your staff. We need to trust our staff that working at home means genuinely working at home and not another day at the beach. Being flexible means trusting that the outputs don’t change, regardless of how staff are working or where they are working from.

PwC: Speaking of people, how do you see diversity affecting New Zealand companies?

Mark: For me diversity of thought is all about ensuring we remain relevant for the future. Part of that is gender, but diversity of thought is much more than just gender. The level of Asian and Pacific Island engagement in New Zealand is definitely going to change – I think by 2038 more than 50 per cent of the country will be of either Asian or Pacific Island descent. Companies also have to think about bringing in different ages – the younger generation who embrace technology have to be involved. It’s that mix that will lead to true diversity of thought.

PwC: Can we talk about cost efficiencies, how do you think you balance cutting costs with investing in keeping employees, shareholders and the community happy?

Mark: I think that there’s always a balance you have to strike there. So while you might create some cost efficiencies through automation for example, the key is to balance that with investing more in your people – to develop different skills or get involved in more specialist tasks, particularly at an early stage in their career.

PwC: So looking forward to the next 12 months to three years, what do you think will change, and what will stay the same?

Mark: The piece that will change is around how we provide services, thanks to technology and the way our people work, we’re going to see a lot of change in that space. However, the importance of relationships and the need to provide insights that are seen to be adding value – that’s what will remain the same.

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