Midlands business leaders are aware that they must look far
beyond the domestic UK and traditional markets to safeguard their
prospects and futures, says PwC.
The 14th annual PwC Global CEO Survey shows that business
leaders across the UK are focusing on developing markets and
looking to innovation and the development of new products and
services for future growth.
Mark Smith, regional chairman at PwC in the Midlands, said:
"Midlands business leaders recognise that they need to be braver
and specific in their focus on new markets if they want to compete
in the global environment. Many of the UK's traditional
export markets are currently underperforming and, compared to their
counterparts in other countries, UK CEOs see less opportunity for
growth at home. The fact that our exports to the whole BRIC group
of countries are roughly the same as those to Ireland is not a
sustainable equation."
UK CEOs' confidence levels for their businesses over the next 12
months are slightly higher than last year, though markedly lower
than the global average. Only 15% of UK CEOs believe the domestic
market presents their companies with high-growth potential relative
to other markets. In contrast, the major regions polled outside
Europe tend to have more faith in their home turf with around half
thinking their domestic markets offers high potential for growth.
Some 83% of CEOs in India, for example, see their domestic market
offering high growth potential and an even greater number of CEOs
based in Brazil think the same.
Mark Smith, regional chairman at PwC in the Midlands, said:
"Business leaders in the region remain concerned with financial
stability and the tax regime but recognise that even if these
issues are resolved, it will not be enough for UK plc to retain its
position and profile. Even in this challenging economic climate,
Germany and the US are still seen as quality global suppliers,
particularly to rapidly developing economies. The UK needs to make
sure it is on that list."
Some 20% of UK CEOs identified new geographic markets as the
main opportunity to grow their business over the next 12 months, up
from 14% the previous year. There is also a marked new commitment
to developing new products and services and they believe that the
innovation needed to make this happen will come from inside the UK,
through external partnerships with suppliers, for example.
UK CEOs show themselves to be more concerned with increasing tax
burdens than most other major European countries and believe
ensuring the stability of the financial system and affordability of
capital should be key priorities for government, though they feel
their ability to influence this is limited. On the positive
side, they feel they have a more prominent role to play when it
comes to developing a UK workforce with the right skills to meet
the challenges of the future.
Almost half of UK CEOs worry that talent with the right
technical skills tends to lack flexibility and creativity. Perhaps
in recognition of this, almost 60% of UK CEOs intend to increase
their use of non-financial rewards and 58% are planning to deploy
more staff on international assignments over the next 12 months,
presumably to build international experience and breed the skills
needed to work successfully across different markets and cultures.
Elsewhere in the talent field, 39% of UK CEOs plan to change their
people strategies to attract and retain more women and 25% say they
will make changes to recruit and retain older workers.
Nine out of ten UK CEOs say they introduced a cost reduction
programme last year, a higher proportion than the average across
the rest of Western Europe or other region. In addition, more UK
CEOs reduced headcount than was expected in 2010 and fewer
completed the cross-border M&A deals they had planned. Over 80%
of UK CEOs said they had significantly changed their strategies due
to economic forecasts and uncertainty over the last two years.