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Virgin pulse login pwc3/20/2024 When entire industries take this approach, they can create the very situation they were hoping to avoid. When companies hunker down in anticipation of an economic downturn, they conserve cash and scale back spending. Recession fears can create a self-fulfilling prophecy. Add in the respondents who agree, and it jumps to 81%. Thirty-five percent strongly agree that there will be a recession in the next six months. Most executives see an economic downturn coming. As the inflationary period drags on, that is becoming a less viable option however, undercutting companies’ pricing power. ![]() Many companies have already passed along price increases to their customers. CMOs are focused on retention and are increasingly personalizing products and services to make their customers less price sensitive. Among the CFOs in our sample, for instance, 33% tell us they’re spending much more time on inflation today compared to a year ago. The impact of all these factors hits executives differently. More than three quarters (77%) are mostly or completely confident that they can achieve near-term growth goals, and 76% are confident in their ability to free up working capital. Forty-four percent are hiring in specific areas to drive growth, 42% are planning cost cutting not including headcount reductions and 26% are planning to reduce the number of full-time employees. This balancing act also applies to talent.Almost half (47%) say they’re making changes to strategic planning based on current business conditions - more than any other activity. In the next 12 to 18 months, executives are balancing cautionary moves with smart investments to drive targeted growth.Eighty-six percent tell us they’re concerned about the Federal Reserve’s tightening cycle, 82% about wage growth not keeping up with inflation and 81% about declining consumer purchasing power. Business leaders also worry about inflation.Four of five (81%) believe a recession is coming within the next six months. The economy is center stage: 90% of executives are concerned (34% moderately and 56% very) about macroeconomic conditions - more than any other issue. ![]() How well - and quickly - a company can adapt and transform will help determine who can survive and come out on top. ![]() Executives are switching from a mindset of controlling costs to one that is keenly focused on transformation and targeted growth because it’s the only agenda to take a company forward. After nearly three years dealing with a series of crises, from the pandemic to geopolitical issues to the current economic storm clouds, executives are becoming seasoned, and many are confident about their ability to respond. In our third Pulse Survey of 2022, business leaders continue to show optimism despite a backdrop of rapid economic deterioration.
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