DURBAN – Chief executives of private businesses are less optimistic than they were a year ago about the strength of the global economy, and their own organisation’s ability to grow revenues. This is according to research of over 800 private business owners as part of PwC’s 22nd Annual Global CEO Survey.
Only 33% of private business leaders are very confident about growing revenue in the coming 12 months, compared with 38% of executives in publicly traded companies. Although 43% of private business chief executives expect the global economy to improve over the next 12 months, as many as 30% expect it to decline, compared with only 6% in the previous year’s survey.
According to the survey results, only 32% of private businesses are likely to pursue a merger or acquisition compared to 43% of public company respondents. Consequently, private businesses are more likely to look inward for organic growth – achieved through operational efficiencies and new products or services – rather than enter new markets.
Two interrelated themes of this year’s CEO Survey point to steps that private businesses should take in order to put themselves in an advantageous position over the coming years.
1. The right talent can make a difference: The talent crunch is an overarching concern in this year’s survey. Almost two-thirds of private business leaders are finding it more difficult to hire workers, with more than one-third “extremely concerned” about the availability of key skills. This shortage impacts innovation, customer experience, as well as the company’s bottom line.
2. Technology can reshape your business: Technology tools, such as Artificial Intelligence (AI) and data analytics, and tech-related threats, such as cyber-attacks and IP theft, are rapidly changing. Although private businesses enjoy a degree of flexibility that can support innovation, this is one area where publicly traded companies have the edge over their counterparts.
Private businesses need to be cognisant of tools that are developing and may be coming online – and be ready to spend on them at the right time.