U.S. Chief Executive Officers (CEOs) are highly confident about their business prospects over the next 3 years and will focus on investing in new technologies in order to remain competitive and grow, according to a study released today by KPMG LLP, the U.S. audit, tax, and advisory firm.
The KPMG U.S. CEO Outlook 2017 report features results from an in-depth survey of 400 U.S. CEOs. Key findings include:
- 54% are “highly confident” in U.S. economic growth in next 3 years, up from 23% a year ago.
- Confidence in growth of the global economy over the next 3 years rose to 82%, up from 74% last year.
- The vast majority (92%) see the U.S. as the top market for new growth—a significant change from last year when 44% viewed India as the top market.
“CEOs see this time as one of opportunity and investment and are locking into what needs to be accomplished to distinguish their companies,” said Lynne Doughtie, Chairman and CEO, KPMG LLP—in a press release. “They understand that in today’s fast-changing, ultra-competitive environment digitizing their business and investing in new technologies is critical and will result in a need for new talent.”
Top Priorities and Investments
The surveyed CEOs said improving speed-to-market, digitizing the business, becoming more data-driven, and building public trust are their top four strategic priorities. In the next 3 years, they expect significant investment in cyber security, digital infrastructure, regulatory/compliance, and emerging technology. Top technology-specific investments identified over the next 3 years include data and analytics, cognitive technologies, and the Internet of Things.
Hiring New Talent
Implementing new technology will require the right talent and CEOs in the KPMG study acknowledge that they do not yet have the digital and emerging technology capabilities to succeed. Fifty-seven percent admit that their organizations do not have the sensory capabilities and innovative processes to respond to rapid disruption. Almost half, 49%, are concerned about the integrity of the data on which they base decisions.
Ninety-one percent of CEOs expect to increase headcount over the next 3 years with 32% expecting increases of more than 6%. One-third said they will significantly increase headcount in middle and senior management, research and development, and Human Resources to deal with emerging cognitive technology.
Disruption as an Engine for Growth
Sixty percent of the CEOs see technological disruption as more of an opportunity than a threat and 72% said that rather than waiting to be disrupted by competitors, their organizations are actively disrupting the sector in which they operate. Last year, two-thirds of CEOs were concerned their organizations were not disrupting business models in their industry.
Reputation and Trust
Taking into account the increasingly transparent business environment in which they operate, CEOs ranked reputational and brand risk the fourth most concerning risk (out of 16 total)—a meaningful shift after not ranking in the top 10 in 2016.
Eighty-one percent of CEOs said their organization is placing greater importance on trust, values, and culture in order to sustain its long-term future.
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