Midlands-based CEOs have a positive outlook but they also need
to be bold and avoid 'sticking to markets they know' at the expense
of pursuing opportunities further afield, says PwC.
Analysis from PwC's annual global CEO survey shows that 79% of
UK CEOs are upbeat about revenue growth in the coming year,
compared with 64% of CEOs in the Eurozone countries surveyed. This
could be an encouraging sign that the UK is faring better, in
confidence terms, and almost half (46%) said they are 'very
confident' of growth in the next three years.
However overall, UK business leaders say the outlook for global
economic conditions remains challenging, with 89% of UK CEOs
believing it will not improve, or decline further in 2012. Further
cost reductions are anticipated, as UK CEOs focus on reinforcing
and building share in existing markets rather than expanding into
new ones. Nationally, the survey found that less than a quarter of
CEOs (22%) are looking for growth from new products or services,
and only 18% from new geographic markets.
Mark Smith, senior partner at PwC in the Midlands, said:
"Some business leaders in the region may be guilty of sticking
with what they know, believing that their best chance for growth in
the next 12 months will come from increasing their share in
existing markets, rather than going for growth.
"Growth opportunities still exist, particularly in faster
growing emerging market economies and where new technology is
opening up possibilities. The challenge now is to ensure that the
experience of slower growth in traditional markets and the
uncertainty created by more volatility does not prevent them taking
advantage of these areas of new opportunity.
The majority (53%) of CEOs nationally plan to increase global
headcount in the next 12 months, while 21% say they expect to cut
their global workforce. It is encouraging to see that 85% of CEOs
say they have access to the talent needed to deliver their
company's strategy over three years.
The major concerns on the minds of UK CEOs include uncertain and
volatile economic growth (86%), the Government's response to the
fiscal deficit (74%), lack of stability in capital markets (72%)
and over regulation (60%).
Nationally, CEOs say that the majority of their key business
outside the domestic market is in Western Europe, with 45% engaged
in North America, 28% involved in the Middle East and 8% in Africa.
An interesting development this year is that although China is
still perceived as an important territory for growth, this is at a
lower level than in last year's survey, with just 26% of CEOs
saying that they see the most important growth opportunities in
China compared with 42% in 2011. Interest in Brazil has also
dropped off from 15% to 5% in the 12 months, with interest in India
at 12%.