According to the fifth KPMG International Global CEO Outlook, a majority of CEOs (84 percent) believe a ‘fail-fast’ culture is required in today’s marketplace, in which lessons from failures are learned quickly, yet only 56 percent say that kind of culture is in place in their organization. They are confident but realistic regarding three-year growth outlook for the global economy and their companies as well. CEOs named climate change the biggest risk to their organization’s growth.
The modern CEO needs to accept and embrace the fact that they have more to do and less time to do it in. 67% of CEOs said the 5- year average tenure means there is more urgency to act with agility. Close to three-quarters —74 percent — said that they had a significant misstep early in their career — such as launching a venture that ultimately proved unsuccessful — but that they were able to learn from their experiences.
Ľuboš Vančo, Chairman of the Partner Board, KPMG on Slovakia said: „The modern CEO needs to accept and embrace the fact that they have more to do and less time to do it in. One of their primary tasks it to create an environment where new ideas can be tested without prejudice and in which willingness to change is recognized as a strength, not a weakness.”
According to the fifth KPMG International Global CEO Outlook, just over half of CEOs are confident they will succeed but are realistic, with 53 percent projecting cautious three-year growth of up to 2 percent (down from 55 percent in 2018). As with 2018, they are also maintaining a positive three-year growth outlook for the global economy, although this has slightly fallen from 67 to 62 percent over the last 12 months. This confidence is also shown by their commitment to hire, with 36 percent of CEOs projecting to add more than six percent to their workforce in the next three years.
CEOs named climate change the biggest risk to their organization’s growth, the first time in five years. Cyber continues to be high on the CEO agenda, despite falling from the second highest risk last year to fourth this year. In 2019, a larger group of CEOs (69 percent vs 55 percent in 2018) say a robust cyber security strategy is critical to driving trust with key stakeholders and most (71 percent) view information security as a key factor in their broader innovation strategy.
For many CEOs, M&A presents the best opportunity to upgrade digital capabilities with pace. A proactive M&A strategy is on the agenda for 84 percent of CEOs who have a moderate or high M&A appetite for the next three years. Driving this appetite is the ability of M&A to transform a business model faster than organic growth.
Artificial intelligence (AI) is on the minds of CEOs, yet only 16 percent have implemented AI and automation programs. A further 31 percent are still at the pilot stage, while 53 percent admit to undertaking a limited AI implementation. Yet 65 percent of CEOs believe the inclusion of AI and automation will create more jobs than it eliminates.
Now in its fifth year, the KPMG CEO Outlook provides an in-depth three-year outlook from thousands of global executives on enterprise and economic growth. The 2019 survey covers 1,300 CEOs in 11 key markets and 11 key industry sectors. A third of the companies surveyed have more than US$10B in annual revenue, with no responses from companies under US$500M. The survey was conducted between 8 January and 20 February 2019. To view additional information about the study please visit www.kpmg.com/CEOoutlook.