Here’s a roll-up of pandemic-related executive sentiment and insights from thousands of functional leaders across the C-suite.
Fast word on tactics and concerns from thousands participating in our conference calls and polls.
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Executives involved in cost management will continue to shore up cash during this prolonged crisis — but are also now setting the stage for strategic moves aimed at the hoped-for recovery.
The most cited business priorities for CEOs over the next two years are growth (55%) and technology (45%), according to a third quarter survey. Yet, for the rest of this year, most CEOs want CFOs to focus on cost management and reduction. This near-term cost discipline can help free up funds to support digital acceleration, the No. 1 priority for board directors (as reported in 2Q20).
Cash flow and preservation is also a prime concern for the remainder of this year:
Among this group of 110 leaders across industries, 43% expect revenue to return to 2019 levels sometime next year. One-third of them don’t expect a return to relative normalcy until 2022.
Sixty-five percent of executives involved in enterprisewide cost management surveyed in 3Q20 say their organization has set up a cost management taskforce in response to the pandemic. Three quarters of these teams include the CFO on the taskforce, who is also most likely to be chosen to lead it. Other regular participants are the CEO (56%), the COO (50%), the CHRO (44%) and the chief sales officer (35%).
Marketing was the function asked to reduce cost or cut budget most frequently this year (90%). This was followed by sales and HR (78%), and then customer service and operational roles (69%). While a significant proportion of leaders from all functions cited facing cuts, those least likely to be impacted included IT (60%), finance (62%) and supply chain (64%).
These same executives involved in cost management reported that savings were most commonly found by cuts to travel and expenses (81%), external consultants or labor support (65%), freezing hiring (64%) and facilities or equipment (60%).
They were less likely to either replace permanent employees with contingent workers(15%) or replace full-time with part time employees (14%).
Over the next six months, they are introducing a more strategic approach to cost management that focuses on efficiency and changing customer needs, including:
Reducing or reengineering internal processes (28%)
Reducing or reengineering customer service offerings (24%)
Reducing or reengineering product offerings (23%)
Over 1,800 CIOs and senior IT Leaders across industries were asked in July and August about how their company has fared in the wake of COVID-19. Forty-five percent said that it had reduced sales volume for the entire enterprise, 26% reported boosted sales, and 29% said they remained the same. Responses varied by industry:
Leaders in the automotive and transportation industries most often reported that the pandemic reduced their ability to fund new initiatives. Those most likely to increase funding were in consumer goods manufacturing, retail, banking and high tech:
Leaders across industries are more confident in their ability to invest in new business initiatives next year, even those that report being hit hard by the crisis.
CIO Research Group
Compiled by Daniel Ryntjes
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