Business Outlook 2014: Business Executives Show Tempered Optimism

Technology is transforming the way many businesses work, and the recent PricewaterhouseCooper’s 17th Annual Global CEO Survey indicates that for many industries, change can be hard and oftentimes painful.

The report commented that “to pilot their organisations through times of enormous change, CEOs will have to become hybrid leaders, comfortable straddling two worlds to draw on the best of the old while operating at the frontiers of the new.”

Bruce Hassall, CEO of PwC New Zealand, said that “together these trends will create many opportunities for innovation and growth, but they will also raise new challenges for traditional business models.  If your organisation’s core DNA does not have the ability to change, evolve and adapt, you are going to be in real trouble in a world that is changing at such an unprecedented pace.”

But coming into 2014, many businesses are generally optimistic about the outlook for the year.  Dennis Nally, chairman of PricewaterhouseCoopers International, said that “CEOs have begun to regain confidence.  They’ve successfully guided their companies through recession and now more CEOs feel positive about their ability to increase their revenues and prospects for the global economy…  CEOs also acknowledge that generating sustained growth in the post-crisis economy remains a challenge, especially as they deal with changing conditions like slowing growth in the emerging markets…  For the future, CEOs tell us that they expect three major global trends — rapid technological advances, demographic changes and shifts in economic power — will have a major impact on the future of their businesses. Finding ways of turning these global trends to their advantage will be the key to future success”

The PwC report compares and contrasts the attitudes and outlooks of CEOs of global companies from across a variety of industries.

In the insurance world, for example, the report found the 74 percent of executives think that their businesses will be transformed by changes in technology over the next 12 months.  But this trend is also worrisome for these leaders as more than 60 percent of them feel that technological change could threaten their businesses.

In manufacturing, 68 percent of executives worry about rising labor costs in high growth markets.

Similarly, transportation executives worry about a lack of skilled labor, like airline pilots and truck drivers.  They also have concerns over economic growth and infrastructure improvements because of wide-spread budget deficits.