A survey of the 125 chief executive officers (CEOs) across the country has found that CEOs now recognise that agility is the new currency in the current business environment.
The fast pace of digital disruption, the constantly changing macroeconomic environment and the reducing average tenure of an organisation’s top leadership make agility imperative. They realise that if they fail to adapt, their business could become irrelevant. The survey, conducted by KPMG in India, also draws insights from the firm’s Global CEO Outlook Report, and has interesting pointers to how those in the corner rooms in Indian companies are thinking. The 2019 report is the fifth such edition of the survey.
According to the survey, as many as 79% of the CEOs surveyed were bullish about the growth prospects of the Indian economy, compared to 69% in 2018. They are also increasingly bullish about the growth prospects of their own companies, with 94% being positive as opposed to 91% last year. An interesting finding in this year’s survey is also that the CEOs are now keen to expand their businesses in mature regions like North America and Europe, in contrast to the previous year, where the focus was more on expanding in emerging markets. The survey finds 54% of CEOs keen to expand in mature markets this year. “This in part, is due to the opportunities emerging from the territorial politics that we are witnessing across the world as well as developed nations such as the United Kingdom opening its trade doors for India,” the report says.
CEOs are also concerned about three key factors relating to the “return to territorialism”, with 38% concerned about the U.S.-China trade war, another 38% concerned about Brexit and the remaining 24% concerned about the rise of political parties with protectionist policies.
A heartening takeaway from the report is that Indian CEOs are actively disrupting their own sectors, rather than being disrupted. While only 31% undertook such disruptions last year, this year the percentage has more than doubled to 66%. In addition, an overwhelming 81% of the CEOs agree that their growth will be determined by the ability to anticipate and navigate the global shift to a low-carbon, clean technology economy. Innovation is also on top of the minds of Indian CEOs, with as many as 70% of the CEOs believing that they need to improve their innovation processes and execution over the next three years. This percentage was at a much lower 50% last year. As many as 65% of the CEOs surveyed also agreed that the average five years tenure also increases the need for them to act with agility.
67% of the CEOs agree that agility is the new currency of business; 33% are likely to undertake acquisitions to transform their business model.
Importantly, in order to strengthen their resilience, a hefty 85% of the Indian CEOs surveyed are actively transforming their leadership team towards that end. 77% are working to ensure a strong connection between the front-, middle- and back offices in a way that their predecessors did not. To enhance digital capabilities, CEOs in India are also becoming increasingly savvy with migrating their data to the cloud. Only 47% of Indian CEOs are concerned about migrating all their data to the cloud, as opposed to 61% CEOs globally, the report finds. It also sees a sharp jump in the number of CEOs expecting a significant return on returns on investment (RoI) from artificial intelligence systems over the next few years. The figure of such CEOs this year has risen to 57% from just 38% in 2018.
To keep pace with the rapidly changing business environment, one in every two CEOs also say they intend to upskill their current workforce with new digital capabilities. A healthy 69% of the CEOs surveyed said they were well prepared for a future cyber attack, as opposed to just 36% in 2018.
Of the 125 CEOs surveyed, 14% were from the manufacturing sector, 10% from banking, another 10% from the energy sector, and 8% each from asset management and consumer and retail.