The majority of technology CEOs surveyed globally (54 percent) believe that a “return to territorialism” is the greatest risk to their growth, according to a new report by KPMG, the audit, tax, and advisory services organization.
The survey was based on interviews with 104 tech CEOs. And while it didn’t spell the idea out specifically, it is clearly a reference to the trade wars initiated by U.S. President Donald Trump.
Only 3 percent of CEOs say their top-line revenue growth will be more than 5 percent over the next three years, while 49 percent say it will be between 2 percent and 5 percent, and 48 percent say it will be less than 2 percent.
Over the next three years, 42 percent of CEOs say they will expand their company’s headcount by between 6 percent and 10 percent, and 43 percent say they will expand less than 5 percent.
“The rise of nationalism and affiliated global economic tensions are among factors bringing caution to revenue growth expectations. Still, nearly nine out of 10 tech CEOs remain confident in the growth prospects for their company,” said Tim Zanni, tech leader at KPMG, in a statement. “Tech CEOs are focused on profitability and investing in technology and their people, as well as considering new business models.”
On technology for social good, 35 percent say they are struggling to link their growth strategy with a societal purpose for their company.
“There’s a growing expectation for tech leaders to link their strategies with technology for social good. It’s important that CEOs communicate a clear and consistent strategy about their organizations’ vision and beliefs and how their strategy is impacting their customers, employees, and society at large,” said Zanni.
On customer data and the importance of cybersecurity for growth and trust, 59 percent say protecting customers’ data is one of their most important responsibilities in enabling their company to grow its customer base. Forty-nine percent say a strong cyber strategy is critical to engendering trust among key stakeholders. And 45 percent say cybersecurity risk is the greatest threat to the growth of their business (second on the list behind territorialism).
“With the pervasiveness of technology and data, securing that data and protecting customer privacy are foundational to maintaining customer trust, market leadership, and regulatory compliance,” said KPMG tech cyber leader Vijay Jajoo, in a statement. “Companies are regularly reviewing their cybersecurity at the highest levels because the risk evolves as quickly as the technology.”
When it comes to AI, in terms of jobs and the biggest benefits over the next three years, 60 percent expect AI to produce a net increase in jobs in their company, and 42 percent say improvements to customer experience will be the biggest benefit AI provides their company.
“More companies are harnessing the powers of AI to augment human decisions. These technologies will allow their employees to focus on higher-value activities, serve customers more effectively, and develop better products and services,” said KPMG intelligent automation leader Cliff Justice.
Tech CEOs also rated their company’s performance in terms of delivering personalized experiences to customers: 24 percent say they are exceeding expectations, 53 percent said they were meeting expectations, and 22 percent feel they are coming in below expectations.
On the biggest challenges in serving millennials, 53 percent cite attracting millennials’ attention among competing online content, while 44 percent note pressure to respond to millennials’ expectations for services on demand. Adapting their sales and distribution model is challenging for 43 percent, and 42 percent point to challenges repositioning their brand. Meanwhile, forty percent say understanding how millennials’ needs differ from those of older customers is a significant challenge.
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