CHICAGO (Oct. 28, 2019) Global accounting network Crowe launches The Art of Smart 2019.
Produced annually, The Art of Smart is the most comprehensive study of corporate decision-making in the world. It examines the traits of quality decisions in the context of corporate success by exploring Crowe’s four strategic indicators of good decision-making – growth, diversity, boldness and innovation – in order to provide insight to CEOs and business leaders on how to make better decisions for their businesses.
The report features the world’s only decision-making index that analyses companies from across the globe, interrogating sector- and region-specific data, to benchmark them in relation to the quality of their business decisions.
“Crowe is committed to enhancing value for the benefit of our clients, our people and the societies in which we live and work. Part of that commitment is helping people to make smart decisions that bring lasting value,” said Crowe Global CEO David Mellor. “The Art of Smart is a pioneering research resource which seeks to inform the discussion around strong and effective decision-making. More than any other factor, it remains the key component to determining successful companies and predicting future business success.”
Diversity driving smart decisions and explosive performance
Companies that scored highest in diversity in The Art of Smart also achieved explosive business growth – 3,680% on average over five years. These companies are shown to have harnessed diversity as a driver of performance by fostering inclusive cultures that provide an array of different viewpoints on which to base well-founded strategic and operational decisions.
The report also shows that European corporate board diversity is the highest in the world (34% female representation, compared to 23% in North America, 17% in Asia-Pacific and 5% in the Middle East) and that women tend to be more prominent in younger, bolder companies and in industries that are expanding quickly, such as biotech and metals and mining.
Risk motivates bold decisions and innovation
The Art of Smart also reveals that risk is a motivation for bold decisions and innovation. The report’s findings suggest that bolder companies are often operating in more challenging business conditions, and the more challenging a situation, the bolder the company.
Innovative companies tend to be more prevalent in sectors where growth is sluggish, and, contrary to popular belief, younger companies do not necessarily innovate more. Successful companies operating in slow-growing industries had a higher number of recognizable innovations.
In general, organizations in the Asia-Pacific region had the highest average boldness and innovation scores – 50% of the boldest companies are based there, as are 64% of the most innovative – a trend driven principally by China and other emerging economies in the region, as they seek to aggressively increase their market share.
Biotech setting the standard for smart decision-making
Biotech is a standout sector in The Art of Smart data. It is not only the most prominent sub-sector in Crowe’s entire index, it also dominates the growth rankings. Fifty-five percent of the top 20 companies ranked by overall growth (across all industries) were from U.S. healthcare – and of those, 73% were in biotech.
The report discovered that biotech’s decision-making success has been driven by its focus on identifying unmet needs or developing next-generation processes. Its use of diverse teams to tackle problems in parallel, addressing them from multiple perspectives at once, also unlocks innovation. Although more expensive in the short-term, this allows products to be brought to market faster, returning profit to shareholders as quickly as possible.
Furthermore, biotech is a leader in the successful deployment of tech tools to support and facilitate its work, opening up greater possibilities for the development of new medicines and other biotech applications.
“The Art of Smart report confirms that smart decision-making leads to lasting value,” said Crowe LLP CEO Jim Powers. “Crowe sees innovation, diversity and boldness as key factors in the growth of the global economy, and we look forward to continuing to use those indicators to support our clients, people and communities.”
For further data, analysis and smart-decision case studies, please visit: www.crowe.com/artofsmart
About The Art of Smart
The Art of Smart explores the many different facets of decision-making, providing insight to business leaders on how to make better decisions for their businesses. It evaluates corporate decision-making on four strategic indicators; Growth, Diversity, Boldness, and Innovation.
Company data for The Art of Smart 2019 was extracted from global recognition sources including the Forbes Global 2000, Fortune, and Fast Company, having met the following criteria: specifically, active in the Healthcare, Real Estate and Manufacturing sectors; operating internationally; and, publicly listed for at least five years. A full methodology can be found at www.crowe.com/methodology.
About Crowe Global
For over 100 years, Crowe has been making smart decisions for multinational clients working across borders. Ranked the eighth largest accounting network in the world and the sixth largest accounting network in Asia, Crowe has over 200 independent accounting and advisory firms in 130 countries. It is also one of only seven global firms in Gartner’s “magic quadrant” for risk consulting services. The network has a total global workforce of 36,540 professionals and global revenues of US$4.3 billion.