34% of CEOs say an average competitor will be out of business within three years if it doesn’t change its business model
84 % of executives say executing at the pace needed to win in the market is a challenge
Only 41 % of executives say there is strong consensus about how they’ll change the company’s business model
Between May 15 and May 22, 2024:
PwC surveyed 673 US executives, including CFOs and finance leaders (13%),
tax leaders (12%),
risk management leaders, including CROs, CAEs and CISOs (12%),
CIOs, CTOs and technology leaders (12%),
CHROs and human capital leaders (12%),
COOs and operations leaders (12%),
corporate board directors (8%),
CMOs and marketing leaders (12%) and CEOs (7%).
This is the first time PwC’ included CEOs.
Respondents were from public and private companies in six sectors: industrial products (28%),
consumer markets (21%),
financial services (15%),
technology, media and telecom (20),
health industries (4%),
energy and utilities (8%),
and other (4%).
The Pulse Survey is conducted on a periodic basis to track the changing sentiment and priorities of business executives.
Executive summary
In the current business environment, US companies need to transform — repeatedly and holistically — or risk falling behind. In PwC’s latest Pulse Survey, business executives understand what’s at stake, and they believe they have what they need to reinvent.
But the data also signal some red flags. Business executives broadly agree on their company’s future vision, but they also believe there’s significant misalignment about how to get there and even how long it will take. This gap in alignment can be a critical factor in your company’s survival or failure.
Meanwhile, almost all companies must deal with a riskier business environment and roadblocks to reinvention. Still, many recognize the need to change how they create, deliver and capture value, and their leaders are looking ahead to fully reinventing their business models.
Here are some of our key findings.
- CEOs emphasize the need to reinvent. More than a third (34%) of CEOs say that the average competitor in their industry will be out of business within three years if it doesn’t change its business model.
- Confidence is high in talent and capabilities. Most of the executives (76%) tell us that they have the right talent mix to support the company’s future vision, and the same percentage say they have the capabilities to execute business model changes at scale. But 84% also say that executing at the pace needed to win in the market is a challenge.
- And there’s a gap in executive alignment. Nearly six in 10 (59%) of executives say there’s strong consensus about the company’s future vision, but only 41% say the same about how to get there.
- Many companies have initiated the reinvention process. Roughly 75% of companies have started or completed measures to reach new customers directly, to make their products “smart” and to build collaborative networks to share value, among other reinvention efforts.
- Executives are prioritizing investment over cost cutting. To enhance performance, they’re investing in new technologies (51%) — and generative AI (GenAI) specifically (51%) — as opposed to cutting costs (30%).
- The overall business risk landscape appears to be intensifying. The most serious risks to executives are familiar — cyber attacks, an uncertain macroeconomic environment and the US regulatory environment – and they’re all up from August 2023. Executives cite the cost of adopting new technology as the top challenge, with 42% saying it’s a significant challenge.
58% of CFOs say they’re spending more time on tech investment and implementation compared to a year ago
Innovative CFOs are restructuring to create value that goes beyond transformation. Using open sightlines to spur growth, finance leaders still need to drive fundamentals that support the bottom line. With widespread disruption from economic challenges, geopolitical unrest and rapidly evolving technology, CFOs are working harder than ever.
As practical strategists with an enterprise-wide view, CFOs must reconcile funding new ways to do business with finance basics: 44% say increasing the use of tech to reduce costs is very important to fund in the next 12 months, and nearly half (46%) are prioritizing tech implementation to improve capabilities.
Find out what else CFOs are focusing on in our CFO report launching June 18.
Click here to read the full report.
