The challenge of rapidly changing customer behavior

Last Updated Nov 5, 2015 11:41 AM EST

Pity the poor CEO or top executive at a major corporation these days. Consumer demographics and technologies are changing so quickly that some huge companies now find themselves under demands, deadlines and pressures comparable to those facing armies on a war-time footing.

In fact, a new survey by PwC finds changing customer behaviors are "set to disrupt businesses in all industries over the next five years." And many of those companies expect to find themselves flat-footed when it comes to successfully delivering what their consumers value.

The PwC Global Operations Survey asked nearly 1,300 "decision-makers" across a wide spectrum of countries and industries to express their thoughts on how they currently lead operations at their organizations.

More than 60 percent of the operations execs surveyed said they expect evolving customer behavior to become a "disruptive factor" over the next several years.

At the same time, only 25 percent said they were "extremely confident" that their operations were designed to provide their consumers value and a "distinctive experience," while nearly two-thirds said understanding what their customers value is a challenge for their own company operations.

Brad Householder, principal and supply-chain leader at PwC, said companies used to have enough "slack in the system" that they could adapt to these market changes without running into issues such as cost, working capital and other essential financial elements.

But with millennials (ages 18 to 24) moving into the marketplace as both consumers and decision-makers, as well as revolutionary technologies such as social media, many companies now have to turn on a dime if they want to successfully accommodate their customers.

"Any large corporation is kind of an organism," Householder told CBS Moneywatch. "To change and mobilize and move the company from one direction to another is a very difficult challenge that used to take years, if not on the order of a decade. Now those sorts of changes happen on the order of months to a year."

One of the biggest factors, he said, is consumers are now more informed, more data-driven and much less loyal than in the past. Householder added that companies that are unable to adapt to rapid change are at risk of falling behind.

A lot of executives, however, appear aware of the possible existential threats their companies face.

More than half of those polled in the PwC survey said they were looking beyond improving their existing operations protocols, to break away from the traditional "functional silo" system to where the front and back offices -- as well the marketing and manufacturing departments -- become more synchronized via an overall corporate strategy.

And two-thirds of survey respondents said more "cross-functional collaboration" in their organizations would have the greatest impact on helping them reach their strategic goals.

Householder said some of these changes are already underway in sectors seeing fast-changing trends and consumer demands, such as technology. But he noted that even some of the more "historically slower-moving industries" such as chemicals are also adapting to a faster and more competitive landscape.

"The environment is changing," he said. "The historical way of driving business with a very functional mindset is not going to satisfy that dynamic environment."