High confidence.
Measured expectations.
Lynne Doughtie
KPMG U.S. Chairman and CEO
This year’s U.S. CEO Outlook fnds CEOs ardently
pursuing growth and technology-driven disruption, buoyed
by high confdence in the U.S. economy and their own
growth prospects.
What’s changed since last year The need for disruption has
intensifed further, and technology has emerged as the only
driver of transformation for a majority of U.S. CEOs. These
developments have brought up some “old” issues but with
a decidedly new twist.
Cybersecurity risk this year makes it back to the top of
the list of risks, but it is no longer seen as a matter of
implementing the basic blocking and tackling activities.
CEOs now realize that full preparedness requires longer-
term sustainability of cyber risk mitigation versus point
security projects.
The always important customer experience is this year
viewed through the lens of personalization. It takes on a
new meaning amid the intensive scrutiny of customer data,
as exemplifed by new laws about customer data protection.
Despite these new challenges, U.S. CEOs feel confdent
about their abilities to steer their companies through
transformations, while realizing that they need to proceed
judiciously. You’ll fnd a great deal of data and insights
to draw from in this report, as leading CEOs and KPMG
leaders share their strategic and tactical challenges as well
as solutions.
As always, we sincerely thank the CEOs who took the time
to share their views with us.
Workforce
development:
balancing urgent
needs with long-term vision
U.S. CEOs are almost evenly split about
whether technology will create or eliminate
more jobs. Almost all (99 percent) use
contingent workers. CEOs are focused on
prioritizing the importance of urgently needed
technical skills, but they also must think about
the long-term development of the workforce.
Delivering for
customers:
permission and
presumption
Ninety-three percent of U.S. CEOs believe
technology investments to personalize the
customer experience have delivered on
their promise, and yet almost a quarter
(22 percent) say their companies do not meet
customer expectations for a personalized
experience.
CEOs as leaders
of radical
transformations:
who will succeed
Ninety-one percent of U.S. CEOs believe
they are personally prepared to lead radical
operating model transformation. But many
still have an ambivalent relationship with data
when making critical decisions.
Cybersecurity:
from remediation
to prevention
Sixty-eight percent of CEOs believe that a
cyberattack is a matter of when and not if.
Ninety-two percent feel prepared in terms of
their ability to identify new cyber threats, but
only 41 percent consider themselves very well
prepared.
Economy and
growth: tailwinds
and turnarounds
Eighty-four percent of U.S. CEOs express
confdence about economic conditions and
growth prospects for the U.S. economy, and
98 percent are confdent about the growth
of their companies. Yet their revenue growth
forecasts are moderate.
Technology-driven
disruption: scope,
speed and timing
Eighty-six percent of CEOs consider their
companies to be active disruptors, and
for a vast majority, technology is the only
signifcant disruption their business faces.
For some companies, the change driven by
technology will be nothing short of a full
rethink, while others may need to proceed
more judiciously.
Key findings
12018 U.S. CEO Outlook
Economy and growth:
tailwinds and turnarounds
To stay
competitive,
companies need
to at least match
their competitors
in the use
of advanced
technologies.
–P. Scott Ozanus,
KPMG U.S. Deputy Chairman
and COO
“The economy is now tied for the
second-longest expansion cycle on
record. For the frst time since before
the fnancial crisis, all developed
economies are experiencing growth,
which is an additional tailwind. Finally,
the Fed has projected that it will
continue raising rates at a gradual
pace, meaning the low-interest rate
environment is expected to continue,”
says Constance Hunter, KPMG’s Chief
Economist.
For the restaurant industry, which is
highly dependent on discretionary
income, consumer confdence
approaching 20-year highs indicates
the economy is in a fantastic place,
according to Michael Osanloo, CEO
of P.F. Chang’s: “I am bullish on the
economy overall, but especially so for
the restaurant industry.”
The pharmaceutical sector, on the
other hand, follows its own cycles of
innovation, driven more by science
than by the economy itself. Tarek
Sherif, CEO of Medidata, a provider
of analytics software solutions for
clinical trials, believes that we’re at
the early stages of a huge wave of
innovation in pharma and biotech, with
trends such as personalized medicine,
immunotherapies and biologic drugs.
And yet, despite the bullishness,
the CEO projections for revenue and
headcount growth are much more
measured. Almost half (49 percent)
of companies expect to have revenue
increases of at least 2 percent,
which is below long-term averages
of 3.8 percent since 1990.
How to reconcile this bullishness
with moderate growth prospects
“Disruptive innovation has shifted
expectations of ROI (return on
investment) from linear progression to
wildly varying, based on a technology’s
potential, forcing companies to accept
greater volatility in their growth
projections,” said Carl Carande, Vice
Chair, KPMG Advisory.
Jim Kavanaugh, CEO of World Wide
Technology, advises taking a long-term
view on technology investing: “You
can no longer evaluate technology
investments through only a traditional
lens. When the goal is market
disruption or to create a new business
model or level of engagement,
understand that the return is
more complex and may materialize
over time.”
U.S. CEOs express high confdence about economic
conditions and growth prospects for the U.S. economy,
as well as for their industries and companies. Several
factors are converging to create optimism.
22018 U.S. CEO Outlook。