A huge number of CEOs from around the world think their companies are in trouble – and they appear ready to do something about it.
Nearly 2,000 CEOs polled recently by accounting and consulting firms PwC says that his company will not be “economically viable” within the next decade without changing its current path. This is almost 40% of the total number of CEOs surveyed across 105 countries for PwC’s annual Global CEO Survey.
They are worried for many reasons. More than half of the CEOs surveyed cited changes in consumer demand, regulatory changes and labor shortages as challenges to their profitability over the next 10 years.
Forty-nine percent are worried about their profits being cut from technologies like artificial intelligence, 43% said supply chain disruptions will continue to be a threat, and nearly a third are worried about competitors from outside industries entering their territory.
The PwC report cited “climate change, technological disruption, demographic shifts, a fracturing world and social instability” as additional “megatrends” that could reshape businesses in the coming years.
US CEOs were most optimistic about their long-term business models, while business leaders from Japan and China were the least optimistic. And despite the concerns, the majority of company leaders surveyed — 60% — are not planning any layoffs for at least the next 12 months.
However, the report’s prescription for a concerned CEO may not be a particularly good fit for some workers.
In the report, the authors recommend that company leaders start making bold choices about the long-term direction of their company. He pointed to Dutch multinational Philips, which reinvented itself as a health technology company in 2010 after focusing on lighting products since 1891.
Philips split into two companies to make that change, spinning off its lighting division in an initial public offering in 2016. The move worked — pulling the company out of a significant rut at the time. (Its stock recently plunged following a major device recall.)
CEOs surveyed said they want to make bold decisions like these but are not prioritizing them at the moment.
A majority said that in their ideal world they would spend 57% of their work time figuring out how to meet future demands. Instead, managing the current performance of their companies takes up much of their time, he said.
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