Today, the need for business leaders and policy makers to fundamentally rethink the way they plan, invest and operate their business in the future is underlined in a new survey of 699 global CEOs released by PwC. According to the survey, majority of CEOs believe that COVID-19 pandemic driven shifts towards remote collaboration (78%), automation (76%) and fewer people working from offices (61%), are here to stay. Overall, 61% percent of the CEOs say that their business model will be more digital in the future - a change which has been majorly accelerated by the pandemic.
Current responses show digital infrastructure, flexible working and employee well-being will be the top of their boardroom agendas as they reconfigure business operations to secure growth in the next 12 months and beyond. Fifty-eight percent of CEOs say ensuring supply chain safety will also remain a focus, driving technology investments to enable tracking of products from production to delivery, and to ensure their suppliers and partners are resilient during crises.
"Business leaders need to simultaneously keep their company running today and fundamentally rethink their strategy for tomorrow, so they come out of the pandemic ready to reconfigure their business to thrive in a very different world. And they need to do that, thinking not just about the COVID-19 acceleration of change in society and the rising expectations of their broader stakeholders, but also the other issues that are going to fundamentally reshape the future of business - from climate change to populism," says Bob Moritz, Global Chairman, PricewaterhouseCoopers International Limited.
In a challenge to decades of increased globalisation, almost two in five (39%) of CEOs believe there will be a permanent shift towards onshoring and insourcing, and a similar share expect an enduring increase in nationalism.
Business leaders need to simultaneously keep their company running today and fundamentally rethink their strategy for tomorrow, so they come out of the pandemic ready to reconfigure their business to thrive in a very different world.
Kristin Rivera, Global Leader, Forensics & Crisis, PwC US, comments, "The COVID-19 pandemic has reminded CEOs of the importance of building resilience into their operating model. Firms that were able to quickly adopt digital working practices or switch their supply chains were better able to withstand the shock. CEOs now need to simultaneously contend with the unfolding pandemic and to rethink how they operate in the future. Not every innovation developed in a crisis is right for the long term, but there is much to learn."
CEOs are naturally cautious on their own revenue growth prospects in the year ahead (45% somewhat confident: 15% very confident). 65% are predicting a decline in global growth. Concern about the global economy is highest in Africa, Central & Eastern Europe, Asia and Latin America.
Business leaders also believe the pandemic increased the importance of responding to a wider range of stakeholder issues, particularly employees. Employee support measures included health and safety (92%), well-being (61%) and financial support (24%). Forty-two percent made contributions to community organisations and almost a third (32%) of business leaders reduced their own pay. Those CEOs who maximised retention (36%) and protected employee health and safety (92%) believe it will have a positive impact on their organisation's long-term reputation.
Bhushan Sethi, Joint Global Leader, People and Organisation, PwC US, says, "The accelerated shift to flexible working has been valuable for many companies. Whatever new models emerge, it's clear that employee-oriented policies that invest in safety, protection and well-being could become the new differentiator for recruitment, retention and company reputation."
The changes driven by COVID-19 add significantly to an already full agenda for CEOs. Climate change remains an influential trend for consumers and businesses alike. When asked if the shift to climate change mitigation would endure, the majority of business leaders (47%) said it would. Business leaders believe short term increases in disposables (including sanitizers, masks) and decreases in the use of the sharing economy would only be temporary.
While the majority of CEOs (61%) believe that there will be lower workplace density than before, they remain divided about what role cities will play in the future - 34% believe the shift towards de-urbanisation will continue; 38% believing it is temporary.
Business leaders are not expecting extended government support and with the majority (57%) believing state intervention to be a temporary feature, despite the potential for governments to use the support to influence COVID-19 recovery and policies impacting business. Less than one in three (30%) of the CEOs believe that government support will be sustained, despite a gloomy outlook for global and organisational growth prospects in the next 12 months. One in five respondents comment that they declined government backed support for their business during the pandemic.
Bob Moritz comments: "Some CEOs may feel like they've passed a critical test. What's critical now is that they use the important knowledge they've gained about their organisations effectively for business and society. The most enduring shift in this pandemic is the reality that it can no longer be a choice between the long and the short term. We need to address both."