PwC’s 20th CEO Survey

by AM admin on February 1, 2017

By Byron Carlock, PwC US Real Estate Practice Leader –

There’s an old song with the lyrics, “You’ve got to accentuate the positive / Eliminate the negative / Latch on to the affirmative / Don’t mess with Mister In-Between” that I’ve been humming lately after reading our 20th CEO Survey.

I was struck by the sense of optimism, hedged by a keen sensitivity to uncertainty, which seemed to underpin the CEO’s responses. Against concerns around globalization, socioeconomic and political unrest, and the backdrop of the fourth industrial revolution, the world looks very different from even a few years ago—but the respondents generally see a lot of opportunity, though work still needs to be done.

Since I’m still humming, I’ll segment some of the key messages along those lines below:

  • Accentuating the positive. Despite their concerns (regulatory, economic uncertainty and lack of key skills, among others) CEOs are more optimistic than last year. They’re not just confident that their revenues will grow in the year ahead; they’re expecting it to happen globally, too. 29% of CEOs surveyed (and we checked with almost 1,400 of them) think global economic growth will improve and 38% are very confident about revenue growth—compared to 27% and 35% last year, respectively. This isn’t restricted to just emerging markets. In a bit of good news for the US and UK, political changes seemed to have no impact so far on CEOs’ appetites to invest in those countries. And, interestingly enough, the US tops the list of countries as the main target for growth in 2017, with China coming in second.

 

  • Eliminating the negative. While nearly two thirds of CEOs agree that globalization has benefited connectivity, trade and capital mobility, almost half (44%) said that it has not helped at all in closing the gap between rich and poor—and the same numbers agree that it will be more difficult to compete and succeed in a ‘closed’ world. Additionally, 58% think it’s becoming harder to compete on the world stage as a result of more closed national policies. CEOs, though, are also keen to collaborate with governments to fix the systems that support global trade and ensure a fairer distribution of the benefits to be gained from keeping the doors to globalization open—suggesting that they are focused on improving the communities and cities where their people live and work.  This may begin by adding to the payroll(s), as 52% of CEOs plan to increase headcount over the next 12 months

 

  • Latching on to the affirmative. While talent is a top concern—77% of CEOs are concerned about skills which has been critical as they continue to operate during a time of the fourth industrial revolution—they have isolated skill sets like innovation (23%) and digital capabilities (15%) as the top areas they want to strengthen in order to capitalize on new opportunities. Purpose and trust are becoming even more important, as 93% of CEOs agree that it is more important to have a strong corporate purpose in today’s digital world.

 

As for “Mister In-Between,” we’ll see what he delivers as 2017 continues to unfold.

I’d love to hear what you think.

 

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