January 22, 2018
Attracting and retaining talent is the biggest concern for CEOs going into 2018, but they’re feeling generally more optimistic about the global economy, claims a new report by The Conference Board, the C-Suite Challenge 2018 . A mood amongst senior managers to create organisational cultures that are inclusive, engaged, high-performance, customer-focused, and resilient is prevalent throughout the responses to this year’s survey. The desire for a “culture of innovation” ranks as the number-one innovation strategy in every region (Asia is the one exception, where it is third), every industry, every size company, and among CEOs and C-Suite executives alike. The impact of the New Digital Economy is clearly being felt in the daily processes and practices of organisations, and through the emergence of new competitors from every part of the globe. In Europe’s the c-suite remains worried about the impact of – which is unchanged from last year when it was the 8th biggest concern.
Main issues for 2018
The results of the survey of over 1,000 business leaders about the top challenges facing their organisations in 2018, and their strategies for meeting those challenges also asked business leaders about their “hot-button issues” – issues that will require a special focus this year (SEE TABLE). Some of the key findings include:
Fear of a global recession has plummeted. For 2017, CEOs globally ranked it as their number-one concern; for 2018, they moved it down to their 19th. However, CFOs are more concerned than CEOs about a global recession. They ranked it as their seventh top concern.
The top concern of CEOs is attracting and retaining talent. This is also true for the rest of the C-Suite, including CHROs and CFOs.
The second top concern of CEOs is creating new business models because of disruptive technologies. This is also true for the rest of the C-Suite, including CHROs and CFOs. (While the C-Suite is aligned in their first and second top concerns, they differ in their prioritisation of other hot-button issues.)
Concern about income inequality has risen sharply. For 2017, CEOs globally ranked it 18th; for 2018, it is their seventh biggest concern. It is of special concern in China, where it ranks third.
Anxiety about global trade has increased. For 2017, CEOs globally ranked threats to global trade systems as their 15th biggest concern; for 2018, it is their 8th.
Europe’s CEOs remain concerned about Brexit. For 2017, CEOs in Europe ranked the effects of Brexit as their 8th biggest concern; it ranks the same for 2018, an indication that Brexit remains on their collective radar. Overall, however, Brexit ranks a relative low 26th on the global list.
Business leaders also detailed strategies they are employing to improve performance in six areas: Human Capital, Innovation, Operational Excellence, Customer Relationships/Corporate Brand and Reputation, Regulation and Risk, and Sustainability. Some of the key findings pertaining to Innovation and Human Capital include:
Culture reigns supreme. To improve innovation performance in 2018, both CEOs and CHROs ranked as the most important strategy, Create a culture of innovation that encourages cooperation across functions and business units and promotes risk taking.
Less than half of CEOs (48 percent) see their organisation as a technology leader in their industries. Moreover, less than 10 percent of CEOs globally say they are “extremely satisfied” with their organisation’s ability to innovate, and they continue to struggle with how to measure innovation.
Braced for a new world of work. Fewer than half (41 percent) of CHROs think their workforces in the next three to five years will be comprised predominantly of traditional, full-time employees.
A culture of safe, ongoing communication. For human capital strategies in 2018, CEOs ranked as most important, Communicate effectively from all levels (up, down, and across); communicate consistently and transparently. Also, in this area CEOs ranked as 4th, Encourage an open, safe, and transparent speak-up culture.