What are the best answers that the CEO has to give to face the digital revolution in his company?

NY, 06/10/2019.- The PWC Consultant has published its “22nd Annual Global CEO Survey”. An already traditional study that helps to understand the context and the ways of acting of each CEO in each multinational. A reading to look at the macro and micro figures. Its main conclusions are this year.

When it comes to global economic growth, quite a lot, as it turns out. PwC has been surveyingthe world’s chief executives since before the turn of the century — 1997, to be exact — so this year, we decided to take a look back, as well as forward, to analyse the predictive power of CEOs. We found that CEO survey responses over the past decade reveal a strong correlation between chief executives’ expectations for their own organisations’ revenue growth and actual global GDP growth the following year. In other words, CEOs’ revenue confidence can be considered a leading indicator of the direction of the global economy. 

So what are CEOs saying about the year ahead? PwC’s 22nd Annual Global CEO Survey of 1,378 chief executives in more than 90 territories explores that question and many others regarding the global business climate in 2019. Conducted in September and October of 2018, this year’s survey drills down on CEO insights in top-of-mind areas such as: Growth, Data and Analytics, and Artificial Intelligence. 

Reality check 

Last year saw a record jump in optimism regarding global growth prospects in
2018, and this exuberance translated across regions. This year, by contrast,
saw a record jump in pessimism, with nearly 30% of CEOs projecting a decline
in global economic growth, up from a mere 5% last year. CEOs also reported a noteworthy dip in confidence in their own organisations’ revenue prospects over the short (12-month) and medium (three-year) term. If CEOs’ confidence continues to be a leading indicator, global economic growth will slow down in 2019. 

Look inside-out for growth 

Across the survey rang a general theme of hunkering down as CEOs adapt to the strong nationalist and populist sentiment sweeping the globe. The threats they consider most pressing are less existential (e.g. terrorism, climate change) and more related to the ease of doing business in the markets where they operate (e.g. over- regulation, policy uncertainty, availability of key skills, trade conflicts). When asked to identify the most attractive foreign markets for investment, CEOs are narrowing their choices and expressing more uncertainty. 

Mind the information and skills gaps 

In addition to the fault lines developing geopolitically, CEOs are working to bridge the gaps in their own capabilities. Organisations are struggling to translate a deluge of data into better decision making. There is a shortage of skilled talent to clean, integrate, and extract value from big data and move beyond baby steps toward artificial intelligence (AI). One of the more striking findings in this year’s survey was the fact that — despite billions of dollars of investment1 and priority positioning on the C-suite agenda — the gap between the information CEOs need and what they get has not closed in the past ten years. 

There are no quick fixes when it comes

To closing the skills gap that many chief executives are concerned about this year. Globally, CEOs see ‘significant retraining and upskilling’ as the best answer, and that will take time and money.

North America’s CEOs balance this response with ‘establishing a strong pipeline direct from education’, with 31% selecting both responses. More than a quarter of Middle East chief executives see ‘hiring from outside their industry’ as a potential solution, as do one in five CEOs in Western Europe. 

What is clear is that governments and businesses need to work together5 to help their people adjust to the disruptive impact of new technologies through both channels. A culture of adaptability and lifelong learning will be crucial to spreading the benefits of AI and related technologies6 widely through society. 

This is particularly true in those markets in which the population is aging and people have to work longer to sustain themselves in retirement. 

Improved STEM (science, technology, engineering, math) skills will be important in allowing people to perform the new roles and tasks that will arise out of AI and robotics, but soft skills like creativity and empathy will also be important in making people adaptable and employable throughout their working lives. Creative solutions will address the bottom of the educational pyramid — repurposing trade and technical schools to equip young people for success. As organisations build a better workforce strategy for the future, they will need to rebalance their workforce composition, convert traditional jobs into more flexible roles, and appropriately price the tasks that people perform. 

PwC’s Workforce of the future study7 charts a path to a working environment that not only upskills workers for technological change but provides a sense of purpose and a great people experience. 

Yet, nearly a quarter of CEOs have no plans to pursue AI ‘at the moment’. A further 35% ‘have plans in the next three years’. And another 33% have only dipped a toe into AI for ‘limited uses’. On a global basis, fewer than one in ten CEOs have implemented 

AI ‘on a wide scale’ (see Exhibit 16). Not surprisingly, we see the highest adoption rates in regions that are further along the digitisation curve — Asia-Pacific, North America, and Western Europe. 

The skills gap is one factor stalling progress with AI, yet it’s not only a matter of hiring or developing AI specialists and data scientists. It is equally important to cultivate a workforce ready to use AI- based systems, and to foster customers and citizens who can recognise and practice good data management and self- protection. 

Additionally, organisations will need to focus on building a smaller cadre of AI-savvy citizen developers, a line of business specialists who can apply AIto their domains and develop solutionsin partnership with AI experts. To build these and other AI capabilities, PwC has identified six AI priorities for 2019.9 

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