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Indonesian CEOs have very high confidence in company growth, but admit challenges ahead

Indonesia's media release on 2018 CEO Outlook

KPMG’s Global CEO Outlook 2018 reveals that 60 percent of Indonesian Chief Executive Officers (CEOs) are confident about the global economy and 90 percent about their company prospects over the next 3 years.


Related content

  • Growth rate expected to be modest over the next three years
  • Strategic alliances with third parties are getting more important
  • Eight out of ten Indonesian CEOs feel personally prepared to transform their organization
  • Cyber threats are the top risk many CEOs worry about, no matter how well prepared.
ID - 2018 CEO Outlook

The KPMG Global CEO Outlook surveyed 1,300 CEOs this year, collecting their insights into the expectations of corporate leaders on business growth, challenges and strategies for the next three years.

This latest survey reveals that 67 percent of CEOs globally are bullish about the world economy (up 2 percent from 2017), and 90 percent are optimistic about their company’s prospects. Indonesian CEOs included in the survey shared similar views, with 80% very confident and 10% confident about their company’s prospects.

Tempering this optimism is a sense of realism that companies face many global economic uncertainties, and 55 percent of CEOs globally expect under 2 percent top-line growth over the next three years. CEOs in Indonesia are more cautious, with 70 percent anticipating a modest growth level.

Cyber threats return to being the most prominent risk CEOs worry about

In Indonesia, the top risks cited this year stemmed from cyber security and talent risk.

“The discussion about cyber security is very different from a few years ago” said Mr. Irwan Djaja, CEO of KPMG Siddharta Advisory. “The Indonesian CEOs I am talking to recognize that cyber security needs to be part of their agenda, not only an IT matter.”

Thirty percent of Indonesian CEOs believe that becoming a victim of a cyber-attack is not a question of ‘if’ but ‘when’. Seventy percent of Indonesian CEOs stated that they were ‘well’ to ‘very well’ prepared for a future cyber-attack and could contain any cyber-attack on their strategic operations. Eighty percent were confident of identifying a cyber threat. All Indonesian CEOs said that cyber security risk is closely related to their reputation/brand risk

Investing in ecosystems and a digital workforce for growth

Globally and across ASEAN, strategic alliances were the preferred option for driving growth. In line with their global peers, Indonesian CEOs ranked organic growth and strategic alliances as their most important strategies for growth.

In undertaking a number of actions relating to innovation and collaboration to drive growth, half of Indonesian CEOs intend to join industry groups focused on innovation technologies, and the same proportion intend to  engage in corporate venturing.

When looking at the importance of workforce capabilities to support growth, Indonesian CEOs agreed with their ASEAN peers that emerging technology specialists and cyber security specialists are most important.  

Making digital transformation a personal crusade

CEOs are embracing the digital agenda like never before, taking personal ownership for driving digital transformation.

Indonesian CEOs are confident about their personal ability to lead business transformation (80 percent), generally in line with CEOs globally (72 percent). Sixty percent of Indonesian CEOs were also confident that their existing leadership team is adequately equipped. Technology investment has been seen as a strategic, long term investment, rather than a tactical move to solve today’s business challenges.

However, most Indonesian CEOs (80 percent) are struggling to run parallel processes to transform the digital and non-digital aspects of their business. 

Other highlights from the Global CEO Outlook 2018

Among Indonesian CEOs:

  • All Indonesian CEOs see disruption more as an opportunity than a threat.
    Ninety percent are actively engaged in disrupting their sector. None see themselves as struggling to keep pace with the rate of technological innovation.   
  • Indonesian CEOs see less need for change overall
    Nevertheless, 30 percent agree that they need to look beyond purely financial growth to achieve long-term sustainable success.

© 2020 Siddharta Widjaja & Rekan – Registered Public Accountants, an Indonesian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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