Issue Tipping point 2: from cost efficiency to value creation

Summary

The second tipping point Deloitte identifies is a move from cost efficiency to value creation. Persistent cost pressure, shifting consumer and worker behaviour and geopolitical change have pushed many organisations toward efficiency above all else. Deloitte argues that this model is now tipping and that the emphasis should turn to value, through functions redesigned for their purpose, investment in innovation and growth driven by adaptability rather than cost cutting alone. Demographic change and shrinking workforces are also making human capacity scarce. That raises the importance of investing where people add value that machines cannot replace. The winners, Deloitte suggests, will be those that reinvest efficiency gains into new sources of value and better worker performance, not those that automate fastest.