Ever wish there was a survey that describes in detail what CEO’s in this country are thinking and planning? Such a survey could provide valuable data about where the economy is going and what issues dominate the thinking of management at the highest level. Well, there is!
Every quarter, we are honored to be the sole broadcast home of the CEO Confidence Index, painstakingly prepared by Vistage International and delivered by Vistage Chair, Jeff Oak on the Executive Alliance Thought Leadership Team’s radio program, Radio Jobline. Created in 2003, the Vistage CEO Confidence Index has grown to be the largest and most comprehensive report of the opinions and projections from CEOs of small to mid-sized businesses in the country. A trusted barometer for the economic outlook of our nations’ small business leaders, the CEO Confidence Index is a leading indicator of the U.S. Industrial Production Index 9 months in advance. Here are the takeaways from the 2023 third quarter report delivered masterfully on last week’s Radio Jobline by Jeff Oak.
- As far as the economic outlook, 44% of CEOs see a soft-landing and 51% of CEOs are in the recession camp.
- Profitless prosperity- CEO’s see growth in top line revenue but not growth in profitability due to increased costs including higher wages.
- Only 42% of CEOs expect rising profits next year.
- Expansion has stalled as CEOs are currently focused on cost management.
- Only 35% of CEOs are increasing fixed investments.
- Only 13% of CEO’s expect the economy to improve in the year ahead.
- Only 55% of CEO’s expect increased revenue.
- 48% of CEO’s plan to expand their workforce next year down from 54% in Q1.
Obviously, these are downward trends and not the numbers we would like to see. Companies are in cost containment mode far more than they are in expansion mode. Based on the 3Q 2023 CEO Confidence Index here are some tips for small to mid-size companies from Vistage International.
- Know your customers and your market. Are they focused on price? Other benefits? Growth could depend on your product mix and the true identity of your customers.
- Protect profit- This will help soften recessionary pressures.
- Resist cutbacks, build a backlog and invest in technology.
- People are going to get more and more expensive. If you can, invest in things that reduce reliance on people.
- Strategy is King- When the pandemic hit, strategic plans went out the window.
- A clear, post-pandemic strategy providing crystal clear direction is more important than ever.
- Unfortunately, the new reality is a slow economy and companies must be in alignment at all levels and with all departments. Every layer of management should participate in the planning process for the next several quarters. Companies should also improve employee engagement so that your staff is “buying in” to your new strategy.
- Use metrics to track progress- there is little room for instinct to drive your strategic plan in a slow economy.
Huge thanks and appreciation to Vistage International for producing the CEO Confidence Index and for providing suggestions on how to combat the slowing economy. Shout out to Jeff Oak, the Vistage Chair, based on Long Island, that presents the CEO Confidence Index on Radio Jobline every quarter.
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