More than half of chief executive officers (CEO) of Philippines-based companies believe that their businesses will not be economically viable in the next 10 years, unless they reinvent themselves.
This is according to the 27th Annual Global CEO Survey of professional services firm PricewaterhouseCoopers (PwC) conducted from October to November last year, which showed that 54 percent of the CEOs of Philippines-based firms see the urgent need for reinvention if their companies are to survive.
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“Confidence is fragile among Philippines-based CEOs as megatrends, including technological disruption and climate transition, converge,” PwC said in a statement, commenting on the findings of the study.
The report spans 105 countries and territories, and gathered the insights of a total of 4,702 CEOs, 35 of whom are from Philippines-based companies.
Despite this outlook, the company said that almost all, or 97 percent, of the CEOs in local firms noted that they have taken steps in the past five years to change how they create, deliver and capture value.
It added that 86 percent have also taken at least one action that had a large or very large impact on their company’s business model.
The same report said that, on average, these businesses see three major barriers to reinvention.
The lack of workforce skills was the most cited one, with 71 percent of respondents mentioning it as one of the barriers.
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The other two, the lack of technological capabilities in their respective companies and competing operational priorities, were cited by 69 percent and 65 percent, respectively.
“As the pressure to adapt rises, more CEOs will prioritize big moves to support business model reinvention. Although this is necessary, it’s rarely sufficient,” said PwC.
“To win, leaders must consider a broader range of initiatives, and apply them in combination. Investing in service partnerships to close operating-model capability gaps and keeping pace with technology advancements allow the company to focus on what it does best,” the company added.
Outlook in next 12 months
Despite the concern over long-term business viability, the PwC report said that the proportion of local business leaders who believe global economic growth will improve over the next 12 months has grown to 57 percent, far exceeding the Asia-Pacific average of 40 percent.
Additionally, these business leaders also listed seven major pressures and challenges in their outlook in the next 12 months, with 40 percent citing geopolitical conflict as the top concern.
Meanwhile, inflation was cited by 37 percent, macroeconomic volatility by 29 percent, cyber risks by 29 percent, health risks by 23 percent, climate change by 14 percent and social inequality by 3 percent.