Understanding the Growing Concern in Business

In the face of rapid technological advancements, evolving market dynamics, and increasing global competition, the longevity of businesses is becoming a pressing concern. A recent survey by global consulting firm PwC highlights a significant worry among chief executive officers (CEOs) in the Philippines: the viability of their businesses over the next decade without implementing substantial changes to their business models.

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Key Findings from the PwC Survey

The 27th Annual Global CEO Survey by PwC, which covered 4,702 CEOs from 105 countries, reveals some compelling insights into the sentiments and strategies of Philippine-based business leaders:

• 54% of CEOs in the Philippines are concerned about their business’s long-term viability.
• 97% have made changes to how they create, deliver, and capture value in the past five years.
• 86% have taken significant actions impacting their business models.

These statistics underscore a clear recognition among CEOs of the urgent need for transformation to ensure future success.

Challenges in Reinvention

Despite proactive measures, several challenges impede the reinvention of business models:

1. Lack of Workforce Skills: 71% of CEOs cite this as a major hurdle.
2. Technological Capabilities: 69% face difficulties due to inadequate technology within their companies.
3. Competing Operational Priorities: 75% struggle to balance immediate operational needs with long-term strategic changes.

These challenges highlight the complexity of navigating transformation while maintaining current business operations.

Business Optimism Amidst Uncertainty

Interestingly, despite concerns about their businesses’ sustainability, there is a sense of optimism about the broader economic landscape:

• 57% of CEOs in the Philippines believe global economic growth will improve in the next 12 months, which is notably higher than the Asia-Pacific average of 40%.
• The United States and China are viewed as critical markets for growth.

The Role of Generative AI in Business Transformation

Generative artificial intelligence (GenAI) is seen as a significant driver of future business success:

• 60% of CEOs expect GenAI to impact the workforce within three years.
• 57% believe GenAI will positively affect revenue and profitability, compared to 49% across the Asia-Pacific region.

This optimism towards GenAI reflects a broader trend of leveraging advanced technologies to drive innovation and efficiency.

The Imperative of Workforce Upskilling

With the anticipated benefits of GenAI comes the need for a skilled workforce:

• 80% of CEOs acknowledge the necessity of workforce upskilling to harness the full potential of GenAI.

This recognition points to the critical importance of investing in employee development to remain competitive in a tech-driven world.

📢Related: ChatGPT: A Life-saver for Small-Time Businesses

Addressing Climate Change

The survey also sheds light on the steps CEOs are taking towards climate action:

• 75% have initiated or completed efforts to improve energy efficiency.
• 74% have made strides in developing climate-friendly products, services, or technologies.
• 68% have progressed in protecting their physical assets and workforce from climate risks.

However, significant barriers remain, such as regulatory complexity and the lack of sector-specific climate-friendly technologies, cited by 54% of CEOs.

Embracing Continuous Business Reinvention

Roderick Danao, PwC Philippines chairman and senior partner, emphasizes the growing impetus for transformation: “The impetus to reinvent is intensifying. Many of our country’s business leaders are now working on accelerating the transformation of their business models, investing in technology and their workforce, and managing the risks and opportunities related to climate change.”

The path forward for CEOs involves embracing continuous reinvention, leveraging technological advancements, and upskilling their workforce to thrive amidst disruption and transform aspirations into realities.

In this era of rapid change, the ability to adapt and innovate will determine the long-term survival and success of businesses in the Philippines and beyond.