Confident CEOs see the big picture, deal with uncertainty more effectively and – when they work with governments – translate economic growth into societal benefit.
CEO confidence is a leading predictor of global economic performance and, according to PwC’s Annual Global CEO Survey, it’s falling. Writing for Strategy+Business, PwC Network Chairman Bob Moritz examines the impact of CEO confidence on business performance and suggests ways to boost it.
Confident CEOs are better at seeing the big picture and more effective at responding to change – they’re good at generating global growth. But there’s a growing backlash against globalisation and increasing disillusionment with GDP as a measure of societal benefit. Here’s how to build confidence, continue to grow, and benefit society.
WHAT IS A CONFIDENT CEO?
CEOs who are upbeat about the future see beyond the concerns that preoccupy their more despondent counterparts. Rather than focusing on things like economic uncertainty, exchange rate and commodity volatility, and access to affordable capital, they’re able to see what’s coming in the near to medium term: technological change, cyber threats, climate change and environmental damage.
Clear sightedness translates into more effective risk taking, capital deployment, training and investment in employees, and better links to and investment in local societies:
“Confident CEOs report more experience with data, analytics and artificial intelligence… they see the opportunities in driving holistic digital transformation.” Business confidence “enables CEOs to navigate a steadier, more forward looking course… and that will help all of us manage global, societal threats”.
STEPS TOWARDS CONFIDENCE
CEO outlook matters for your business and for society as a whole: employees trust their employers more than any other civil institution, one reason why building bridges with local communities and governments is vital in changing times. Confidence allows you to do that. Here’s how:
1) Challenge your thinking. Just because your firm has always done things a certain way, or has ingrained attitudes, society is changing fast, and you have to keep up. Tackle issues which have social and business relevance, and be prepared to challenge your established norms.
2) Be transparent. To reduce the impact of economic and social uncertainties: “Business and governments need to communicate clearly, early and often, to one another and to the public the intended outcomes of their actions.” When you begin a new enterprise, being open and transparent with the local community “builds a foundation for long-term cooperation and mutual success”.
3) Embrace lifelong learning. Accelerating technological change is of concern to all, but the way you handle it impacts on your future prosperity and the health of society as a whole. Stop worrying about the jobs AI will replace. Start thinking about the new jobs springing from it – and the skills gap this is creating.
Build stronger links to educational establishments and help them shift focus from the current emphasis on STEM subjects to a more holistic educational programme, which also promotes soft skills and a problem-solving mindset. This creates a more flexible labour force that’s both more able to adapt to change and more comfortable with the processes involved.
4) Counter populism and anti globalisation. Emphasise your firm’s ability to benefit society at the grassroots level. Engage with local government to decarbonise for the good of the local environment and global climate. Adopting “carbon prices”, for example, helps reduce emissions and builds trust with the local community.
Your firm’s outlook, direction, and the way it interacts with society really matters for society. Growing your confidence is about growing your firm’s financial performance, but it’s also about your building a commitment to generating social value. Be confident, be clear sighted, and success will follow.