Chief executive officers in the Association of Southeast Asian Nations (ASEAN) perceive disruptive forces as an opportunity, not a threat, for their business to grow and improve, according to the results of a survey by a global audit firm.
KPMG’s “2017 Global CEO Outlook” finds that ASEAN CEOs, like the rest of the world’s business leaders, view disruption as something that can exert a positive impact on their company operations.
Based on the survey, which interviewed nearly 1,300 CEOs of some of the world’s largest companies, 92% of ASEAN chief executives believe disruption can have a positive effect, while 83% say their business is aiming to be the disruptor in their sector.
These percentages are higher than global figures. Worldwide, 65% of CEOs opine that disruption can have a good effect, while three in four say their business seeks to become the disruptor.
“Disruption has become a fact of life for CEOs and their businesses as they respond to heightened uncertainty,” said John Veihmeyer, global chairman of KPMG.
“But importantly, most see disruption as an opportunity to transform their business model, develop new products and services, and reshape their business so it is even more successful than ever before. In the face of new challenges and uncertainties, CEOs are feeling urgency to ‘disrupt and grow.’”
Operational risk is the highest concern for CEOs overall, said the report. This is followed by risks of emerging technology, reputational or brand risks, and strategic risks.
Cyber security, which CEOs ranked as the top risk in 2016, has this year fallen to position 5 (of 16), with 42% saying they feel adequately prepared for a cyber event—up from 25% in 2016. CEOs clearly believe they are making progress in their management of cyber disruptions.
However, Datuk Johan Idris, managing partner of KPMG in Malaysia, pointed out that this perception was recorded before the WannaCry ransomware outbreak in May 2017.
“In actual fact, ransomware attacks are nothing new and this latest incident reinforces the need for business leaders to remain vigilant and avoid complacency when it comes to governance in cyber space,” said Datuk Johan.
Amid heightened economic uncertainty, 65% of the world’s CEOs remain confident about the global outlook for the next three years, though this is a drop from 80% in 2016.
Globally, the majority of CEOs (69%) also remain confident in their own industry’s growth prospects. In addition, a significant number of CEOs (83%) are positive about their own businesses’ prospects over the next three years.
About three-quarters of CEOs (74%) say their organization is placing greater emphasis on trust, values, and culture in order to sustain its long-term future. This is matched by 72% of CEOs who correlate being a more empathetic organization with higher earnings.
KPMG’s survey further found that over the next three years, the proportion that is increasing investment in recruitment rises to 75%. This suggests that businesses are increasingly looking to hire more specialized talent in the years ahead—such as cognitive technology experts or those with greater insight into geopolitical issues.
This intention is aligned with the number of CEOs in ASEAN who expect to invest in Blockchain and data analytic tools (92%), cognitive technologies including artificial intelligence and machine learning (83%), and internet of things (79%) over the next three years.
“Greater digital investments offer companies more opportunities to secure competitive advantage. It is positive news that CEOs are still committed to invest in their people and make them important assets in the company as one way to manoeuvre around the current period of economic and geopolitical uncertainty,” noted Datuk Johan.
Photo: Eupol Afghanistan
