04/19/2017

From Global Power Shift to Power Dispersion

Authors: Dennis Chesley, Global, Asia Pacific and Americas (APA) Risk Consulting Leader and Alexis Crow, Lead, Geopolitical Investing Practice

In a 2016 strategy + business article, we outlined how a new world economic order had taken hold—one defined by complex and continuously shifting economic relationships. Today, we’re seeing that play out as key countries look to concentrate on domestic growth and consumption. A global leadership vacuum has emerged and power isn’t shifting from one economy to another--it is instead dispersing across emerging economies and sectors. Although it’s possible for these different economic systems to coexist harmoniously, the new multipolar global economic order will add friction to multinational business operations.

Corporate leaders are acutely aware of this reality. In PwC’s 20th CEO Survey, uncertain economic growth topped the list of CEO concerns at 83%, with geopolitical uncertainty ranking fourth at 74%. CEOs overwhelmingly see a world marked by regional, rather than global, priorities. This complex environment is hard to read; a single geopolitical event could trigger a need for a complete or partial overhaul in corporate strategy.1-02

How can businesses—particularly those operating across borders—thrive in this uncertainty? To position their organisations to seize opportunities for long-term growth, CEOs should take these three steps: First, focus on market fundamentals and long-term economic objectives; second, build trust and market connectivity at the local level; finally, have a strategy that adapts to future threats and opportunities.

Stick to the basics:  As Melanie Butler, Partner PwC UK and PwC’s Global Crisis Centre Leader, noted on March 20, economic scenarios are challenging long-held assumptions, confounding multiple stakeholders. CEOs must not be moved by short-term headlines. A long-range mindset positions organisations to be nimble and agile, rather than reactive, which opens windows for growth and investment.

Whereas 20 years ago, CEOs saw emerging markets as the best opportunities for expansion, today they see the greatest growth coming from the US (43%), China (33%), Germany (17%), and the UK (15%). It is important, however, for business leaders to identify the key fundamentals that make a geographical market attractive—what have others missed in pricing an opportunity? Is there a resulting window for investment? PwC Global Economy Watch recommends businesses to look at emerging economies as they seek to grow their international footprint—specifically Vietnam, Poland, Colombia and India.

Plan globally, act locally.  Multinational corporate leaders should also critically examine how to keep their business edge as local competition increases. Identify the messages, mediums and allies that can help win over local populations and their unique preferences. More than ever, companies must communicate how they contribute to the region’s economic empowerment – both of individuals and communities. The majority of CEOs in the PwC survey identified collaboration with government as the best way for business to help spread the benefits of globalisation. Indeed, staying close to the changing roles of governments in this new environment will also better position companies to identify and evaluate new windows of opportunity.

Resilience is key.  The most effective way to thrive in an uncertain world is to have a forward-looking, risk-aware strategy. CEOs must embed their strategy into performance goals and day-to-day operations. And, perhaps most importantly, they must foster a resilient organisational culture that can anticipate and adapt to the threats this politically and economically fragmented world may throw at them.

One thing is clear, in this shifting environment, international growth strategies need to be well-designed to anticipate disruption and adapt to changes. CEOs who operate businesses across borders must think proactively about the risks  associated with power dispersion and their impact on strategy and performance. There is a strong sense that crises are inevitable in cross-border business, but adhering to these steps will help multinational organizations find ways to thrive in the new global economic order.

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Dennis Chesley is a Principal in PwC's Advisory practice with more than 25 years of experience serving public and private global entities with a focus on risk consulting. Currently, he is Global Leader of Risk Consulting, Co-Leader of the US Risk Consulting practice, and a member of the U.S. Advisory Leadership Group.

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Alexis-crow

Dr. Alexis Crow leads the Geopolitical Investing practice at PwC, helping leading companies and asset managers to capitalize on dislocations in order to profit and expand around the globe. Prior to joining PwC, Dr Crow taught at the London School of Economics, and worked at Chatham House (The Royal Institute of International Affairs) in London, and G2, a New York-based investment group. 

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04/11/2017

The fourth industrial revolution: it's not all about machines

Author: Bob Moritz , Chairman, PwC International Ltd. Bob Moritz

Truly dramatic transformation is a rare phenomenon. But that’s exactly what we are in the midst of with the current shockwave of technological transformation. The World Economic Forum has termed it nothing less than the fourth industrial revolution.  Advances such as robotics, machine learning, 3D printing, the Internet of Things, and blockchain are changing not just the way industries work but, in many cases, the business models they are based on.

So as CEOs, how do you prepare yourself to navigate, play a role in, and succeed in this time? In a new article on Strategy+Business, we’ve outlined 10 principles that can help you do just that. I want to share a few of those with you in the hopes of spurring how you are reimagining the possible for your company, industry, and stakeholders. In doing so, I want to emphasize that while technology is spurring these big changes, it is human insights and human decisions that will the ultimate determinants of success.

First, let’s look at technological acumen.  No matter what industry you’re in, you live in a programmable world, and software will be key to your competitiveness. This is not just a matter of recruiting people with software skills. It has to do with raising the overall technological acumen of people at your company. They need not just the technical training to use digital tools, but insight into the patterns of technology: for example, how to create an operations footprint that can take advantage of the industrial internet, or how to accumulate the type of data that can foster machine learning. Noname

The importance of insight brings me to my second point: designing for customers.  Because the next industrial revolution is driven by large-scale digital technology, it’s easy to overlook the way it could affect human relationships. The new infrastructure is a web of connections among people: producers and consumers, in particular, are much more closely connected than they used to be.

Through smartphones and social media, consumers can connect directly to producers and services. Through sensors and data analytics, producers can be thoroughly attuned to the needs, habits, and long-term interests of consumers. As a designer of the new platforms, or a business leader participating in them, you have an unprecedented opportunity to build a customer-centric enterprise, one that connects with what people genuinely want and need from your company, thus generating commitment that will last a lifetime.

Third on my list is rethink your business model.  We have all become accustomed to disruption. In industry after industry, we see that those who cling to old business models lose ground. This next industrial revolution will accelerate this sequence, especially in manufacturing, by reducing costs and improving efficiency at a broad scale.

If your company is falling into the trap of thinking that it can be profitable following its traditional business model, it risks losing out to more flexible competitors. You are not in the same industry that you were in before; soon, that industry may not even exist. Your path to profitability is different. Your opportunities for raising capital have changed. Your circumstances are probably different from those of any other company, so you need to look freshly at them, without relying on an industry playbook, and rethink your business model accordingly.

Finally, in a world of robotics and automation, don’t fall into the trap of putting machines before people. If people are shut out — of jobs, creative opportunities, income, and customer satisfaction — then embracing technology will backfire. As the next revolution advances, it is imperative to keep working on the understanding of how people are interacting not just with the technology but also with its consequences, such as the issues of transparency, trust, privacy. Business, in particular, will thrive in this new world only if its leaders understand the place of human values. So, set up your enterprise to foster better connections among people, to encourage humane behavior, and to build the capabilities that overcome technological isolation.

You can read the rest of the 10 principles by checking out the Strategy+Business website.

From 2009, Bob led PwC US as its chairman and senior partner. During his tenure, the US firm focused on increasing quality service and enhancing its brand and reputation by developing and retaining key talent and expanding its capabilities across all areas of the business. Bob speaks widely on, and is a champion for, diversity and inclusion in the workforce as well as being an advocate for workplace flexibility. Read more

03/30/2017

Competition in the TMT industry isn’t what it used to be: Key insights from our CEO Survey

Author: Brad Silver, Global TMT Leader
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As software and new technology become the lifeblood for all companies, CEOs are keenly aware of the challenge to sustain prominence in their own fields. Nowhere is this more evident than in the Technology, Media and Telecommunications (TMT) sectors.

Fifty-four percent of TMT CEOs (compared to 27% of the global cross-sector average) in PwC’s 20th Annual Global CEO Survey say that technology has completely reshaped competition in their sector in the past 20 years. Nearly half (47%) say technology has completely reshaped competition in just the past five years (compared to 20% across sectors).

This evolution isn’t slowing down anytime soon and we can see the effects throughout the industry. For instance, Mobile World Congress—the mobile industry’s largest annual event—is no longer all about mobile devices, and companies will need to adapt. As Mike Butcher of TechCrunch pointed out, this year’s event had an increased emphasis on connectivity innovations and the services that will run our connected future.

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Is there a sequel in the works?

The next five years could be pivotal, particularly across the TMT sectors, according to PwC’s CEO Survey. More than four in 10 TMT CEOs surveyed see technology once again completely reshaping competition in their sectors within the next five years. This is approximately double the cross-industry average of CEOs who shared this belief.  

So how are industry CEOs taking action now, amid such a radical and rapid transformation of the competitive landscape? This year’s CEO Survey pointed to three key areas that TMT CEOs are tackling now to ensure success:

Convergence and Collaboration: To stay ahead of customer demand and the pace of technological change, the TMT sectors continue to converge and collaborate in order to deliver seamless experiences. About half of CEOs from these sectors are prioritizing a new strategic alliance or joint venture in the next 12 months, and 36% (compared with 28% of the average) are planning to collaborate with entrepreneurs and startups.

Building a new workforce: CEOs from these sectors lead the pack with their plans to strengthen their innovation and digital capabilities, and more than half plan to strategically increase headcount in in the next 12 months. With 86% of these CEOs attributing pending headcount reduction to automation and technology, it is more important than ever to focus on talent with the right mix of problem solving, collaboration, leadership, and creativity/innovation skills.   

Creating a culture of innovation: To supplement this, 73% of TMT CEOs are implementing digital training in their learning programs (compared to 63% of the average). This effort reflects the crucial importance of establishing a culture of innovation, a shared digital language, and a tech-based skillset throughout a company that enables fast and successful transformation.

As TMT companies increase collaboration efforts, transform their workforce through technology, and nurture an innovative culture, there will be important risks and challenges to consider. The uncertainty of global economic growth, as well as cyberattacks on business information and systems, data privacy breaches, and IT outages and disruptions are top concerns for CEOs in our industry – and the majority are taking action now to prevent related crises.

While adapting to near-term transformation, CEOs from across the TMT industry must also keep in mind the long-term impact to their business—particularly because the next 20 years look like they could be just as dynamic as the past 20.

For an in-depth look at the data from PwC’s 20th CEO Survey, check out sector-specific insights for Technology, Entertainment and Media, and Communications.

Brad leads PwC’s Global Technology, InfoComm, and Entertainment & Media practice, a role in which he oversees PwC’s Technology, Media & Telecommunications (TMT) clients across the PwC network. In this capacity, PwC provides services to over 90% of Fortune Global 500 TMT companies.

 

 

03/22/2017

Is your talent brand fit for the future?

Author: Agnès Hussherr, Global Human Capital Leader Agnes Hussherr

These days, news headlines about the workplace of the future are dominated by advancements in technology, automation and robotics.  There’s no doubt that it’s an exciting time of transformation, opportunity and change for all of us in Human Resources.  Interestingly, at the same time, an organisation’s brand has become more accountable to its people than ever before. 

And with 77% of CEOs seeing the availability of key skills as the biggest threat to their business, it’s easy to see why.  The skills they need most are uniquely human ones; problem solving, creativity, innovation, adaptability and leadership.  These skills are crucial to achieving the balance between technology and talent in the workforce of the future – a balance that will soon be a necessity across all industries.  That’s why 60% of CEOs are rethinking their HR function and a substantial 78% say they have already changed their people strategy to meet this need.

CEO Survey_HC cutIn light of these results, and with so much focus on automation and technology, there are some important questions that organisations need to ask themselves: do your people know and trust that they are your priority?  Are you telling the right story to ensure you’re attracting and keeping the talent you need and building a leadership pipeline?

An organisation’s talent brand has to reflect every aspect of its personality; culture and values – and what it stands for; its purpose.  And in doing so, it must also represent your people; your current workforce, the talent you want to attract and your alumni.  The results of our recent research: Winning the fight for female talent showed that from the outset, female talent want to see themselves reflected in a brand.  Women want to work for a brand that values diversity and has visible female role models that they can relate to.  In fact, the report finds that an inclusive employer brand with a transparent and proactive diversity programme, is now critical to attracting female talent.   

This demonstrates the importance of an authentic, ‘lived’ talent brand.  People must not only trust a brand before they will even consider working for them, they want to see themselves reflected in it.  The age old recruitment phrase ‘a good fit’ now carries much more weight and goes both ways, with top talent asking themselves if an organisation reflects their personality and what they stand for. 

Business leaders in this year’s CEO survey placed human capital second only to innovation as a priority, with digital and technology capabilities coming in third.  Indeed, balancing people and technology in the future workforce is going to be one of the biggest challenges facing businesses across all industries.  CEOs realise that to do this successfully, they’ll need skills that technology alone cannot provide.

So every organisation needs to ask itself: does my talent brand tell a story that will attract and retain people with the right skills to succeed – now and in the future?  Because technology is still only part of the story – a story which stars people.

As Global Human Capital Leader, Agnès drives the people strategy for the PwC Network including the workforce of the future, development, performance and talent initiatives. Based in Paris, Agnès also sits on the PwC France leadership team, as Human Capital & Culture Managing Partner.  As an Assurance partner in Banking & Capital Markets, she retains responsibility for several key clients. Read more

03/20/2017

Is ‘crisis-ready’ the new normal in a volatile world?

Author: Melanie Butler, PwC’s Global Crisis Centre LeaderMelanie-butler.jpg.pwcimage.200.252

I struggle to remember a time when the world seemed quite as unpredictable as it does today. The rise of populism, a seemingly resurgent Cold War, the ongoing refugee crisis and many other geopolitical and economic scenarios have challenged long-held assumptions and confounded politicians, pollsters, economists and media commentators alike. Brave is the pundit who states that they know what will happen next.

Today’s CEOs are painfully aware that their organisations may have to fend off calamity as a result of events that they could neither anticipate nor control. Indeed, it seems that managing crisis is becoming a new normal for businesses. When we surveyed CEOs on the topic of crisis recently, nearly two-thirds (65%) said they had experienced at least one crisis[1] in the past three years. And the future looks equally hazardous. More than 30% predict they will face more than one crisis in the next three years, compared with just 16% who think they will face fewer.

Crisis management appears to fall squarely within the remit of the CEO. An overwhelming 91% of CEOs we spoke to told us they were in charge when a crisis hits. I commend them for their strong leadership, yet they have practical concerns about crisis management. Our survey found that 65% of CEOs feel most vulnerable about their ability to gather information quickly and accurately in a crisis while 55% worry about communicating with external stakeholders and employees. To add to the pressure, over half (57%) admit that their business continuity plan is out of date.

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Of course, saving the company from disaster is not the job of the CEO alone. Effective crisis management is a team effort. It involves preparing the right strategy, governance structures, teams and plans so that, in the event of a crisis, the response can be implement, adapted and scaled appropriately. It also involves empowering the right people to make decisions so that the company keeps the trust of customers, employees and other stakeholders during a period of serious uncertainty. If decision-making is paralysed by the fear of making the wrong call, the CEO could end up isolated, undermined and exposed.

To be good at crisis management, companies need to be prepared - and prepared to work at it. Yet often they struggle to devote sufficient time and resources to creating plans based on ‘what if’ scenarios. There are signs this could be changing, however. Nearly a third (30%) of the CEOs we spoke to have proactively started crisis planning, with another quarter planning to do so over the next year.

There is no such thing as a ‘typical’ crisis. They are all different. But companies that are well prepared can often see their top-line improve after a crisis.  Thirty-nine per cent of CEOs said that a well-managed crisis response actually contributes to revenue growth, no doubt reflecting the customers’ confidence that the company acted responsibly and in-line with its corporate values. Those companies that are well-prepared to face unforeseen events tend to share some common characteristics. They are proactive about identifying, monitoring and mitigating both existing and emerging risks. They make sure that they have the right in-house capabilities to manage a crisis and they plug any gaps before disaster happens. They have a crisis toolkit of processes, resources and technologies and they organise crisis drills to ensure that key personnel are battle-tested. They are clear about who is responsible for what in a crisis and they empower the appropriate individuals to take decisions. Finally, they have a leadership team that is continuously striving to improve the organisation’s crisis capabilities, particularly in the wake of an actual crisis. Wise CEOs know that a good time to prepare for the next crisis is just after the last one has taken place. 

Melanie Butler leads PwC’s Global Crisis Centre “GCC”, which acts as a trusted guide to clients as they prepare for, respond to and recover from the crises they face.  She has worked with and alongside governments and organisations to help them confront crises with confidence and to resolve the critical problems they encounter - and leverages the expertise of our crisis teams across the network so that organisations can reassure their own clients, communities and stakeholders that they’re able to manage crisis situations effectively. Read more

[1] For the purposes of this research we define a ‘crisis’ as when one or more triggers or stress events significantly impacts or threatens the continuity of ‘business as usual’.

 

 

03/16/2017

Turning confidence into performance: The private company findings from the 20th CEO Survey

Author: Stephanie Hyde, Global Entrepreneurial and Private Business Leader Stephanie Hyde

It’s the 20th time PwC has run its annual survey of the world’s leading CEOs, and as usual, there are some important and thought-provoking results. Taking a deep dive into the private company CEO views emerging from the Survey highlights a number of areas that private businesses need to focus on if they are to deliver on their ambitions for growth amidst a turbulent and uncertain market environment. The pace of technological change continues to quicken, it’s increasingly difficult to find people with the ‘right skills’, and the gaining and keeping of public trust for corporations is becoming a more important concern. Exploring the data in more detail, and seeing how different markets and sectors are thinking, provides a good baseline on which you can evaluate where you are in your business compared to where you want to be.

What are private company CEOs thinking, as we look ahead to 2017, and beyond? What stands out most is their self-confidence. CEOs in general are relatively gloomy about the immediate prospects for the global economy, but they’re all positive about their own prospects, and none more so than private companies. We see that 86% of these CEOs expect revenue growth over the next 12 months, up 5% from 2016 – a significant jump. In fact, it's the first time in five years that private company CEO confidence has been higher than that of public company CEOs. Likewise 92% of private CEOs expect growth in the next three years. So how well-founded is this optimism, and what challenges might they face in turning confidence into performance?

PwC_Rep_USA_SF_JFB_0171It’s not easy to find definite answers to the first of those questions. The data suggests that private businesses are more cautious than public ones when it comes to strategies for growth, or perhaps lack the skills or resources to fully exploit the possible options. Fewer private companies plan to accelerate growth through outsourcing, acquisitions or new collaborations with SMEs or entrepreneurs, though the number planning new M&A activity is on par. By contrast, when it comes to the challenges they face, the picture is much clearer. Finding and retaining people with the right skills remains a bigger issue for private companies, and especially for family firms and other companies that can’t offer shares or options to attract the best. But the real message for this sector is technology – both the risk it represents and the opportunities it opens up.

The survey results suggest that private company CEOs are markedly less concerned about cyber threats than their public company peers. This is a concern, given that there is growing evidence that hackers are now targeting smaller and private businesses, because they are likely to have less secure systems – and less money to spend on updating them. I think this particular finding really stands out for me as a red flag for the sector. Private companies have to take this issue more seriously, and do so with real urgency. And the flipside of the digital question is almost as worrying, though for different reasons. Nearly three-quarters of private companies expect their markets to be transformed by technology over the next five years, but it’s far less clear how many of those CEOs are acting on this expectation and actively seeking to transform their own business so it can to survive and thrive in that new environment. Our own experience of working with the sector suggests that private companies in general are lagging public ones in this area. With so many new pay-per-use and cloud-based apps now available, there really is nothing standing in the way of even very small companies taking full advantage of  the possibilities of digital. Indeed, they can often do so more nimbly and cost-effectively than many of their larger competitors, who are often encumbered with legacy IT infrastructure.

Taking a step back, I think that many of the findings in this year’s CEO Survey echo those we found in the 2016 Family Business Survey. That study looked at the issue of the ‘missing middle’ in family firms – in other words, the need to bridge the gap between running the businesses day to day, and thinking in generations. Private companies in general need to develop robust strategies for the medium term, covering issues like talent management, innovation, and the use of new technology. This is where a strong board can be invaluable. I’ve seen that many successful private companies have been able to take advantage of quicker decision-making to be more agile in the market. Experienced and objective non-execs can provide not only valuable know-how, but rigorous oversight, ensuring the necessary strategic plans are not only developed, but appropriately challenged, efficiently implemented, and regularly monitored. That, in the end, is what will help turn confidence today into performance tomorrow.

Stephanie sits on the PwC Global Leadership Team as Entrepreneurial and Private Business Leader and is also a member of the PwC UK Executive Board, as Head of Regions. The Global Entrepreneurial and Private Business segment works with over 100,000 businesses, and contributes over 20% of PwC’s global revenues. Starting with the firm in 1995, Stephanie became a partner in 2006 and joined the Executive Board in 2011. She has worked in a diverse range of industries from energy and defence to pharmaceuticals and manufacturing. Read more

03/13/2017

Inside the mind of the investor: how CEOs can improve engagement

Author: Richard Sexton, Vice Chairman, Global Assurance at PwC RS pic

I’m pleased to announce that this year’s Global Investor Survey has now been released. Following the success of last year’s survey, we again set out to gauge sentiment among investment professionals and compare it with the views of chief executive officers (CEOs). We asked both groups for their views on growth prospects, threats facing companies today and the challenges and opportunities presented by technological innovation to see where companies and the investment community could find common ground.

Unsurprisingly, their responses showed a variety of perspectives – but what areas stood out most?

Key areas of concern and opportunity

I think the two main areas that I found interesting this year were the generally upbeat view of investment professionals about global economic growth prospects, and the increasing influence of technology as a disruptor and enabler.

Although both groups cited geopolitical uncertainty as one of the top five threats to company growth prospects (investors naming it the top threat and CEOs naming it the fourth), investors also remained relatively positive about global growth prospects. Nearly half of the 554 investors surveyed (45%) expect global economic growth prospects to improve over the next 12 months, over double the number of last year and more optimistic than CEOs.

Another area investors have strong views is the effect technology has had on competition in the industries they follow. There are very few who think it’s had no effect at all, and whilst recognising the speed of technological change is slowing, almost one in five (19%) still think technology will completely reshape competition within 5 years.

An area where CEO and investor views roughly aligned though was around automation, and the possibility of it reducing headcount. 85% of investors expect automation to reduce company headcount, compared with 80% of CEOs who are expecting their company headcount to decline. So companies may wish to think about how they can invest in developing their employees’ skills now to prepare them for changes to their traditional roles as technologies such as AI, robotics and automation become more prevalent.

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Areas of improvement for companies

This year’s research identified a number of areas in which companies can improve their communications with investment professionals and other stakeholders, including their approaches to supporting innovation, the need for a strong corporate purpose and values, and steps being taken to prevent cyber-attacks and data breaches.

At the end of every section of this year’s survey we’ve included a number of questions for companies to ask themselves. We hope these questions, along with the findings of this year’s survey, will help improve the quality of engagement, and hopefully understanding, between companies and the investment community.

I would like to take this opportunity to thank all the individuals who took the time to answer our surveys and speak to our researchers in person. Without hearing their opinions we would be unable to share these insights.

If you would like more information on this year’s survey, please contact Hilary Eastman here.

Richard Sexton is Vice Chairman; Global Assurance, an appointment he took up on 1 July 2013. In this role, he focuses on further building the PwC network’s global assurance practice with particular emphasis of quality and regulatory matters, trust in the profession, and broader financial markets. Read Richard's full biography.

03/10/2017

Globalisation and business – the challenge of reclaiming trust in society

Author: Colm Kelly, Global Tax and Legal Services leader Colm_kelly

Well managed market economies have served as the basis for social progress - but what do increasing concerns about trust tell us about the future of business in society?

The opening of new markets, the availability of diversified sources of products to consumers, and capital for investment and the sharing of knowledge and talent have all helped businesses expand and accelerate social progress around the world.

Millions have been lifted out of poverty: the share of the global population living in extreme poverty has fallen from 40% just 30 years ago to below 10% today. 

Yet, the assumption that business is good for the system as a whole is now being challenged. 

PwC’s recent CEO survey reveals the large gap between how CEOs and the public view the impact of globalisation: only 38% of the public believed globalisation has had a largely positive impact on improving the movement of capital, people, goods and information, compared to 60% of CEOs.  Both CEOs and the public are voicing concerns about the increasing loss of trust in business. People’s legitimate worries over their prospects are fueling populist movements and political dynamics. This trust breakdown poses a potent risk to political, economic and social systems the world over. PwC_Globalisation 

What’s eating away at public confidence in business occurs on two levels: personal and societal. Personal, in that people lose trust in companies as a result of breaches of data privacy and ethics (84%) or IT outages and disruptions (71%). Societal, because the public have higher expectations of a business, and its social role and responsibility – irrespective of whether they are its customer.

The impact on CEOs has also been significant. In 2003 70% of the CEOs surveyed thought corporate misdeeds posed little or no threat to growth. Today 59% of CEOs worry about the lack of trust in business as a threat to growth. 85% believe it’s important to run their business in a way that accounts for wider stakeholder expectations. 

The 2017 Edelman Trust Barometer report supports these findings, illustrating that ongoing globalisation and technological change are further weakening people’s trust in global institutions. People believe governments, business, media and NGOs have failed to protect them from the negative impacts of the globalisation trends. The report concludes that the trust collapse has now evolved into a systemic threat. 

We cannot turn back globalisation. Neither can countries operate in isolation. Too many factors including technology, international business, climate change, immigration and a host of others have implications beyond the borders of any one country.  So how do we retain and re-balance the positive progress of a globalised world with delivering for people in their local communities? ​How can we measure success beyond GDP and make sure that economies can better serve a dual goal - to deliver both financial and societal outcomes for citizens?

We know that we need to realign business, economic and societal outcomes but how should we evolve society’s current systems to build the kind of future we really want? 

The debate has started, but it will require a louder voice from business – working with policy makers and the public -- to contribute to the conversation to help address these critical challenges.

Colm Kelly is the Global Tax and Legal Services leader for the PwC network. Prior to his current role, Colm was Vice Chairman, Operations for the PwC network. Colm was previously a member of the PwC Global Tax Leadership Team with responsibility for Global Tax Strategy and Markets. He was also a member of the European Tax Leadership team for several years. Read more

03/08/2017

Five strategies for finding — and keeping — female talent

Authors: Bob Moritz and Sharmila Karve

Today is International Women’s Day, a day to celebrate the many social, economic, cultural and political achievements of women. But how do we keep the momentum going beyond today, and bring about real change in the way women work, are hired and progress in their careers?

A new report explores just that question. Winning the Fight for Talent examines gender-inclusive recruitment around the world. From rapid technological advances to demographic shifts, megatrends around the world are driving a greater urgency into reassessing existing recruitment practices. Organizations need to be more innovative, they need to be stronger magnets for the right leaders, and they need to build brands and cultures that are inclusive and engage with consumers and stakeholders.

With so many demands on performance, the key to success is embedded in talent — and when you aren’t considering half the population, you are missing an immense pool of creative minds. This is the reason why 78% of large organizations are actively searching for more women, especially in senior roles. While this bodes well for global gender parity, there is much progress still to be made.

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We’ve uncovered five strategies that leaders can use to position themselves to find — and keep — female talent:

1. Focus on career progression. Women today expect more from their careers than any previous generation. Among the women we surveyed, female millennials (born 1980–1995) and women just starting out in their careers said career advancement was the most attractive trait in an employer. The least attractive was lack of opportunities. Most experienced female professionals who had recently changed employers cited that as the top reason they left their jobs. Companies that establish formal career progression plans will have better luck at attracting employees and keeping them motivated and committed.

2. Revisit people policies. All companies could benefit from taking a hard look at their policies and assessing which ones meet the needs of female employees. These could include leadership opportunities, professional development, global mobility, flexibility and career progression. Proactive organizations will make sure programmes are updated and new ones put into place. There are many of them: 28% of employers have already adopted a formal returner programme, and a further 25% are currently exploring this opportunity.

Among professional women on career breaks, 76% want to return to work — yet three-fifths of highly skilled and qualified women who return to work end up in lower-skilled (and, as a result, lower-paid) jobs. Career returner programmes are one way of eliminating this bias against a candidate’s career gap, as is an employer’s ability to recognize the skills, experience and potential of women who have taken time away from work.

3. Mindset matters. A lot. Globally, 30% of women said that employers do too little to treat women equally in the workplace. In a survey of professional women, more than one in five women reported personal experience of gender discrimination when applying or interviewing for a job. There are three popular diversity recruitment practices that can help organizations: 1) Ensure that interviewers, including interview panels, are diverse, 2) Train recruitment professionals to focus on more inclusive strategies, and 3) Review role descriptions to ensure use of inclusive language.

Additionally, the global study suggested that there is a significant disconnect between the views of women and employers on the barriers to hiring more women. Of the top five barriers identified by employers, four explicitly point to external factors, such as the lack of a sufficient candidate pool and the industry sector being viewed as unattractive by women. In contrast, of the top five barriers identified by women, four explicitly point to internal systemic challenges, such as the impact of gender stereotypes on the recruitment process and concerns over the cost and consequences of maternity leave. Organizations around the world should keep an eye on internal (e.g. diverse decision-making groups) and external (clear articulation of values) to bridge this gap.

4. Diversity should be baked in and shared. The good news is that 76% of employers have incorporated diversity and inclusion in their employer brands. Among companies with more than 10,000 employees, 88% report having done so. But talking about diversity is no longer enough. Demonstrable progress — such as an inclusive workplace culture and high levels of collaboration, feedback and care — is increasingly important to women when deciding where to work. Over half of the women (56%) who took part in our global study said they looked to see if an organization had made progress in that department when deciding whether to work there. And 61% of them reported looking at the diversity of an employer’s leadership team as well.

5. Last but not least, lead by example. Of all the women we surveyed, 67% said they considered positive role models when deciding to accept a position with an employer, rising to 76% for women at the start of their careers. Leaders have a vital role to play, by creating the right tone at the top, inspiring other women and helping them to reach their full potential. A diversified leadership team is important, as is an inclusive workplace culture that brings everyone to the table. This means that conversations about inclusion should be carried out by men as well as women, and all senior employees should be strongly encouraged to mentor and build trusting relationships with people who don’t look like them. This is a key goal of the United Nation’s HeForShe movement, which aims to mobilize one billion men and boys in support of global gender equality.

This story originally appeared on the WEF Global Agenda blog.

Find out more about PwC’s role as a HeForShe Corporate Impact Championhere. And in this video, PwC Global Chairman Bob Moritz shares what being a HeForShe Impact Champion means to him.

Follow @sharmilaakarve and @bob_moritz to keep in touch and share your thoughts.

 

Bob Moritz

From 2009, Bob led PwC US as its chairman and senior partner. During his tenure, the US firm focused on increasing quality service and enhancing its brand and reputation by developing and retaining key talent and expanding its capabilities across all areas of the business. Bob speaks widely on, and is a champion for, diversity and inclusion in the workforce as well as being an advocate for workplace flexibility. Read more

 

 

Sharmila-karve.jpg.pwcimage.200.252Sharmila  Karve is D&I Global Leader at PwC. Based in Mumbai, India, Sharmila joined the firm in 1985 as an Articled Student and qualified in 1988 and was promoted to Assistant Manager immediately thereafter. She was married during the course of her Articleship period which was quite unusual. She worked with the firm until May 1991 when she left to raise her daughter. Read more

03/01/2017

Software greasing the wheels for Technology, Media and Telecom transformation

Author: Brad Silver, Global TICE Leader Brad silver

Technology, Media, and Telecommunications: just thinking of these industries brings to mind legendary innovators, scrappy startups, emerging technology, and creativity in the pursuit of the solutions of the future.

But we’re not alone anymore…

Software is fueling the development of technology and services-based business models for all industries, and hastening the breakdown of industry walls. Convergence within the Technology, Media, and Telecommunications (TMT) industry is being met with the rapid escalation of technology acquisitions by non-TMT companies. Investments by non-tech companies

As our own Barry Jaruzelski said recently in the Wall Street Journal, software is “becoming the oxygen” for all established companies – regardless of whether their roots are in brick and mortar retail, century-old consumer product brands, manufacturing, or mobile apps.   

So, how can TMT companies succeed amid convergence, increasing competition, and the threat of commoditization? We have identified four guiding principles that can provide a blueprint for successful transformation from a products company to a “software and services” company.

  • Optimise your current position: Think about where your company currently lives in the value chain, and assess whether to expand, transforming your connection with the customer and path to market, or connect, structuring the company to be open and connected with “megahubs” – ecosystem platform drivers.
  • Mobilise and monetise models: IT and business operating models must unite to create a single digital operating model. This also requires adapting service models for business through monetisation of core data, value-added services, cost savings through scale, as well as moving fixed assets to consumption-based models.
  • Focus on customer outcomes: Rather than thinking narrowly about products, or even service offerings – focus instead on how to link core capabilities with the outcomes that customers are looking for.
  • Build a technology “lingua franca” (and an understanding of risk): Establishing a common language around digitisation, and a shared culture of innovation, will help facilitate the seamless collaboration necessary for moving at the speed of technology. Importantly, as companies embrace emerging technologies, they should account for the associated risks and costs. While future success won’t be possible without becoming open, connected, and networked, it is crucial that CEOs assess the cyber and data-privacy threats that can emerge from such a structure, and that the right service partners and protections are in place.

While we can’t see the future, we can prepare for it. Our latest article on this topic, “Software greases the wheels” provides additional insights on how to take decisive action now to prepare for the continued evolution of our industry – and the breakdown of industry walls.

Brad leads PwC’s Global Technology, InfoComm, and Entertainment & Media practice, a role in which he oversees PwC’s Technology, Media & Telecommunications (TMT) clients across the PwC network. In this capacity, PwC provides services to over 90% of Fortune Global 500 TMT companies.