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NEWS IN ENGLISH | CEOs believe in their own growth prospects
CEOs believe in their own growth prospects
2015-04-07 12:36:00
PwC
![]() What do CEOs expect from the global and Hungarian economies? Which countries are targeted for growth? "CEOs are less confident about the growth potential of the global and Hungarian economies, but remain optimistic about their own revenue prospects. Similarly to global results, optimism about the global economy has also dropped in Hungary; while last year 64% of CEOs were confident about growth prospects, their percentage dropped to 46% this year. On the other hand, this year 82% of CEOs said they were confident or very confident about their own revenue prospects. Accordingly, last year's finding, i.e. that Hungarian CEO's have found their way, seems to be substantiated" - says Nick Kós, PwC Hungary's Country Managing Partner, reflecting on the latest results. Regarding targets for growth, it is evident both globally and in Hungary that the focus has shifted from emerging markets to mature markets; for the first time after five years, global CEOs have ranked the US ahead of China, while among Hungarian CEOs, Germany's ranking as the most important target for market growth has increased by 5 percentage points to 30%. In this respect, Hungarian CEOs ranked Romania second and Poland third, followed by Austria, Slovakia and Russia. What factors might threaten growth? While cautiously optimistic about their own growth prospects, Hungarian CEOs continue to be strongly concerned about overregulation (76%) and government measures aimed at reducing the budget deficit (83%). Concerns over cyber threats and the availability of qualified personnel have increased sharply, while corruption and the resulting distrust also pose difficulties for CEOs. "In addition to rapid and unpredictable changes in the regulatory environment, the lack of qualified professionals was one of the central topics in our discussions with CEOs. Hungarian CEOs feel that it is becoming a real challenge to find skilled and adaptable candidates for certain positions. We need to realise that traditional recruitment and retention strategies, which used to be effective a few years ago, are no longer competitive. It is worth considering whether the type of workforce needed is the same as before or companies should broaden their recruitment base to include those with different or more current skills" - stresses Márta Szűcs, Partner at PwC Hungary's Assurance Service Line. CEOs expect the government to implement significant measures to mitigate threats. Compared to last year, the percentage of those expecting the government to create a competitive and efficient tax system has doubled; this year, 72% of the respondents think this should be a government priority; this is higher than the global rate (67%). In Hungary, last year 45%, while this year 68% of the respondents said they expect the government to create a skilled and adaptable workforce, exceeding the global rate of 60%. The third most important expectation in Hungary is creating a business environment that facilitates innovation; as compared to a global rate of 30%, 63% of Hungarian CEOs expect this from the government. How will competition change? According to the CEOs interviewed, changes in the regulatory environment have the greatest influence on the competitive position of their companies. 66% of global and 59% of Hungarian CEOs said that the regulatory environment of their industry had the biggest potential to create an unexpected situation for their companies. According to Hungarian CEOs, rapid changes may also arise due to customer behaviour (51%) and the arrival of new competitors (29%). Hungarian CEOs are increasingly concerned about external competitors; 51% expect new competitors to arrive from other industries. 28% of CEOs plan to enter or have already entered a new industry. Most CEOs expect new competitors to arrive from the technology, utilities, telecommunications and media sectors, while target industries include energy, finance, technology and pharmaceuticals. How is technology incorporated into a company's strategy? Responses given by Hungarian CEOs indicate that digital technologies mainly serve a security function for them; cybersecurity was mentioned by 76% as the most important. Only after these were mobile technologies for customer engagement (60%), socially enabled business processes (47%) and cloud computing (41%) mentioned. Respondents said that digital technologies were mainly used at their companies in the areas of operational efficiency (66%), internal/external collaboration (63%) and data and data analysis (63%). With whom should CEOs cooperate to increase competitiveness? According to CEOs, building new partnerships may be the most important tool for ensuring continued growth and retaining market position. Globally, most CEOs strengthen cooperation with suppliers, customers and trade organisations. On the other hand, Hungarian CEOs indicated customers (59%), business networks and organizations (58%) and suppliers (57%) as the primary targets for cooperation. Hungarian CEOs said they were motivated by the following factors in building partnerships: reaching customers, access to new technologies, reinforcing abilities to innovate, reinforcing brand or company reputation and access to talent. What should CEOs be like in the new competitive environment? "Since Hungarian CEOs expect major changes in the next five years in industry regulation, customer behaviour and the number of competitors, most think that the primary trait of an ideal CEO is adaptability. In their view, to be able to properly lead their companies, adaptability, flexibility and being prepared for rapid changes are required at both personal and organisational levels" - summarises Nick Kós. ![]() ![]()
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