[SPONSORED] Perspectives from PwC: We Are Living in Extraordinary Times
June 24, 2015
For the first time in five years in PwCs Annual Global CEO Survey, more business leaders rate the U.S. as their most important market for overseas growth ahead of all others, including Chinas.
As the U.S. recovery gains traction, it is gaining more adherents. Challenges remain, yet key measures of U.S. economic health are improving. Business hopes are building that the American consumer market will start firing on more than one piston in 2015. PwC projects U.S. GDP growth of 3.2% this year.
Yet even as U.S. economic indicators recalibrate to a more normal setting, it is likely the business environment will not. If there has been one constant throughout the shifts in risk/rewards over the past five years for U.S. CEOs, its been this: With every upgrade and new Internet hookup, devices got smarter, customers got smarter, employees got smarter.
Businesses resigned to dealing with the effects of extreme transparency on pricing models at a time of constrained U.S. spending may find a new set of challenges as the U.S. market gains the global leadership spot.
CEOs everywhere are forging ahead in an environment they believe is more volatile and unpredictable. Across a number of areas, more CEOs are worried about threats to business growth in 2015 than they were three years ago.
Yet 61% of CEOs globally and this is even more so for U.S .CEOs (67%) believe there are more growth opportunities today for their companies than three years ago. Whats more, 46% of U.S. CEOs are very confident of achieving revenue growth this year, a five-year Survey high. Whats changed?
U.S. CEOs intend on making their companies smarter
CEOs are innovating and accelerating the impact of technology for their customers. CEOs say they are seeing real payoffs from these investments. They expect to take risks to operate within diverse and fluid networks.
Yet as CEOs spiral up to better performance with a new set of technology capabilities, tensions are surfacing inside the organizations that are acute and are not going to get better. Activist investors and competitors are pressuring businesses to find new ways to extract value now. Half of U.S. CEOs (50%) believe a significant competitor is emerging or could emerge from technology sector versus 32% of CEOs globally.
Much within their own portfolios is under review hard assets as well as capabilities. Over half of U.S. CEOs (54%) say they expect to complete a domestic acquisition this year, up from 39% a year ago. This year, 23% plan to divest a majority stake or exit a business, up from 15% a year ago.
But its not all about buying (or selling) assets. U.S. CEOs are widening their use of alliances to secure new technology and speed up innovation. They are significantly more willing than peers globally to consider partnering with competitors or customers. Traditional industry boundaries are blurring, and CEOs expect cross-industry competition to accelerate. Over a fifth (24%) say their business entered or considered entering the tech sector within the past three years.
Businesses are recruiting for a wider range of skills and looking for the right fit in more places. They want to better reflect the increasingly global and dynamic customer sets of their organizations as well as meet growing technology demands within their organizations. Over half (59%) expect to expand headcount this year.
Kevin Baldwin is PwCs Pacific Northwest Market Managing Partner. To learn more about our CEO Survey and strategies
or other perspectives on business and how PwC may be able to help, contact Kevin at firstname.lastname@example.org