Australian CEOs are finding it hard to plan for the future amongst the uncertainty of the current economic and political environment.
This is according to a joint research project by Pronto Software and The CEO Institute.
The survey was completed in January 2017 by more than 185 CEOs from various industries, including retail, imports and manufacturing.
This research follows similar research undertaken in 2015 and 2016.
A comprehensive analysis of the 2017 survey showed five top concerns for CEOs, which are resulting from both industry and economic pressures:
Current economic and political environment
Largely shared by almost one-third of respondents, 28% of CEOs are finding it hard to plan for the future amongst the uncertainty of the current economic and political environment.
Unfathomable just a year ago, Britain’s vote to leave the EU and the election of the 45th President of the United States took even the most knowledgeable analysts by surprise.
One respondent stated, “Donald Trump is creating havoc. Between him and Brexit, it’s hard to know where anything stands anymore.”
Mastering disruptive technology
Another major concern for one-fifth of the group (21%) is their organisations’ ability to keep up with technological advances.
This issue may have been demoted from the top spot it held in the 2016 survey, but the topic remains an important – and somewhat polarising – preoccupation for CEOs. Interestingly, almost half (48%) of CEOs know that technology will make or break their organisations’ ability to grow in the future, but they are unsure about which technology will do so.
Adapting to change
Managing change is an important concern for 12% of CEOs.
Change calls for the transformation of operational processes and adaptation of organisational strategies. It is a direct result of the uncertain environment and technological disruption that are destabilising corporate assumptions and expectations.
CEOs also frame the need for change management as a condition for survival: “In order to stay relevant, we need to expand,” says one CEO. “Whether it’s in Asia or the Middle East, this expansion requires that our staff, infrastructure and processes are able to handle the extra push.”
Handling growth
Since the start of 2017, the Australian economy appears to be gaining confidence, but business leaders remain cautious.
For 11% of respondents, a key concern for the rest of the year will be to “find growth in a low growth economic environment”, as one CEO puts it.
How do CEOs plan to sustain growth and revenues despite the seemingly unfavourable global conditions?
One approach is to innovate in as many ways as possible: “If we want to keep growing the business, we have to develop new products and find new markets and consumers to sell them to,” says one CEO. “Developing niche products for niche markets will buy us some time while things stabilise,” adds another.
Managing and retaining staff
In 2015, hiring and retaining staff was the leading concern of CEOs and in 2016 they placed it second.
Today, it is only an issue for 11 per cent, putting it on equal footing with the need to sustain growth and revenues.
This change does not necessarily indicate that finding skilled talent is no longer an issue, but it does show how leaders’ priorities have shifted.
“It’s not so much about finding competent people anymore,” says one CEO. “It’s more about finding competent people who have the right skill and specialty we need at a specific moment in time.”
These themes above also ranked highly in the 2015 and 2016 survey results.
The key difference is that this year, economic and political uncertainties have taken centre stage.