Corporate leaders in India are a worried lot.
Thanks to an escalating US-China trade war, Brexit, and other protectionist policies, just 53% of Indian CEOs are confident about the growth prospects of the global economy this year, compared with 89% in 2018.
The leaders also see growing territorialism and climate change as the top risks to their businesses from overseas.
These findings are part of KPMG India’s fifth annual CEO Outlook report published yesterday (July 10). The audit firm’s survey covered 125 CEOs across industries and sheds light on the strategies being devised at corner offices.
To ringfence their organisations from external threats, most CEOs recognise the need to be agile. Nearly 67% of CEOs identified agility as the “new currency,” saying if they don’t adapt, their businesses will become irrelevant.
Business leaders must respond quickly to factors impacting the long-term growth of their companies, said the report. “Today, CEOs need to be comfortable disrupting their business models by forging new strategic partnerships, considering alternative M&A strategies and increasing the skills of their workforce,” said Arun M Kumar, chairman and CEO, KPMG India.
Pursuing innovation
Macroeconomic threats apart, fast-paced technological disruptions and changing customer preferences will keep CEOs in India on their toes, KPMG India said.
Most leaders are, therefore, open to acquiring new skills. Around 70% of CEOs, as against 50% last year, believe they need to improve their internal innovation processes and execution over the next three years.
Additionally, four in five Indian CEOs want their employees to feel empowered to innovate, without bothering about the consequences.
However, what’s worrying is that most leaders are yet to introduce an innovation-led culture within their companies. Only 46% of leaders believe their organisations have a culture in which “fast-failing,” unsuccessful innovations are not perceived negatively.
Besides encouraging innovation, in order to cope with the new disruptive business landscape, leaders also have to be on top of technology trends to help grow their businesses.
Embracing technology
An Indian CEO’s top priority is to focus on enhancing digital capabilities by deploying new-age technology and upgrading the technical skills of its workforce.
“Technology continues to be a strategic priority for CEOs in India—as they still lag behind CEOs globally in the implementation of leading-edge technologies,” said Kumar of KPMG. However what’s encouraging is that “Indian leaders are increasingly becoming much more confident with their approach and preparedness to embrace their technology,” he noted.
Going forward, about 92% of CEOs in India expect a significant return on investment from their firm’s overall digital transformation programme, within the next three years.
Building cyber resilience is another priority area within digital, according to the report. This year, 71% of CEOs said protecting customers’ data is a critical task, up from 46% in 2018.