Technology, Pharma and Fashion
Future Readiness Indicator 2023
Technology, Pharma and Fashion
IMD Future Readiness Indicator 2023: Innovation and resilience drive the leading companies in Technology, Pharma and Fashion
- Microsoft claims the top spot in technology, followed by rising NVIDIA
- Pﬁzer leads the pharmaceutical sector, in which Eli Lilly and Novo Nordisk made big leaps
- Nike retains the top position in a fashion industry marked by supply chain disruption; luxury players stay strong amid economic uncertainties
In a time outlined by groundbreaking technological advancement and soaring geopolitical tension, companies are constantly rediscovering what it means to be future-ready. The 2023 year-end edition of IMD’s Future Readiness Indicator for the fashion, pharmaceutical, and technology sectors, released today, showcases major innovations and adaptations that businesses have been going through to stay ahead of the curve.
“Our objective is to track this tapestry of change, woven by leaders in their respective fields, to make sense of what’s around and ahead of us in 2024. The idea of the Future Readiness Indicator is to offer key insights into what others can learn from these leaders’ examples,” says Howard Yu, LEGO® Professor of Management and Innovation and Director of IMD’s Center for Future Readiness, which produces the indicator.
Technology: smarter AI, simpler software
Two big trends stand out in the tech world: companies are using smarter AI and demanding software that is easier and all-in-one. Such trends are what Microsoft successfully capitalizes on—being a major investor of OpenAI and a leader in the field of aggregating functionalities under one single software as a service, for example, Microsoft 365.
Once known mostly for graphics chips, NVIDIA can also attribute its steady rise—now moving from third to second—to its total capture of AI applications, from drug discovery to self-driving cars. Meta rounds out the top three, with Alphabet having dropped two positions down to fourth, and Amazon descending from sixth to 10th.
Learn more about the 2023 indicator for the tech industry, including the complete ranking and a detailed breakdown of each of the 40 companies studied
Pharma: research, distribution, and new technologies
Robust investment in research and the ability to navigate the complex logistical and legal maze of global distribution are two of the traits that stand out for indicator leaders Pfizer and AstraZeneca. This has also been a landmark year for obesity treatments, which underpin the ascension of Eli Lilly (from seventh to third) and Novo Nordisk (13th to seventh).
In the face of such fast and acute changes to the world, top-ranking companies are investing in technologies beyond conventional medical research – such as the Augmented Drug Design (ADD) project by AstraZeneca – and in the next generation of distribution networks.
“Pfizer’s cold chain service and AstraZeneca’s end-to-end digital supply chain initiatives are particularly notable. Eli Lilly also shows promise with its investments in blockchain and digital twins for better traceability, logistics, and inventory management,” says Howard Yu.
Learn more about the 2023 indicator for the pharmaceutical industry, including the complete ranking and a detailed breakdown of each of the 25 companies studied.
Fashion: adapting to a fragmented world
Mounting inflation and an array of geopolitical hurdles have seriously affected consumer spending and the operational costs for the fashion sector, which in general faced slower growth in 2023.
It was under this context that Nike outshone the rest of the field, with a notable increase in direct sales resulting in revenue for the third fiscal quarter reaching $12.4bn, surpassing projections of
$11.48bn and representing a 14% increase from the previous year. Hermès and Kering have risen in the ranks, while LVMH and Richemont have sustained their strong performance as beacons of digital transformation in the luxury industry.
“All things considered, supply chain disruptions are driving the need for new manufacturing models, including nearshoring and digital enhancements. Brands are also exploring new channels like the metaverse, utilizing rental channels and off-price retailers. That’s why future-ready companies are realigning their structures to focus on sustainability and digital acceleration. These are the trendsetters who move forward in the lead into 2024,” explains Yu.
Learn more about the 2023 indicator for the fashion industry, including the complete ranking and a detailed breakdown of each of the 29 companies studied
The Future Readiness Indicator and its methodology
Since 2021, the Future Readiness Indicator has been measuring the preparedness of leading companies across six industries: automotive, consumer packaged goods, fashion, finance, pharmaceutical, and technology.
The ranking is based on seven equally weighted factors – (1) financial fundamentals, (2) investors’ expectations of future growth, (3) business diversity, (4) employee diversity/ESG, (5) research and development, (6) early results of innovation efforts, and (7) cash and debt – that comprise 36 variables. The balance composite score is based on hard data, including financial reports, investors’ calls, LinkedIn profiles of the management team, CrunchBase, Factiva, and other publicly available reporting.
- Learn more about the Future Readiness Indicator’s research methodology.