Section 1: CEO Challenges and Issues
The first section addresses several general issues raised by CEOs during the qualitative stage of the research in 2006 and which were validated by the results of the previous three CEO surveys. In the first question, respondents are asked to rate the importance of 12 business issues on a seven point scale ranging from "not important" to "very important." Summary results are presented in Figure 1.
Most issues with the exception of "customer loyalty and retention," received importance ratings that are statistically equal to ratings received in 2009 as well as all past years of the survey. This indicates that even in times of major economic change CEOs maintain a relatively consistent structure of priorities.
Trends of responses to these issues can be seen in Figure 2a and Figure 2b. The trend lines are spread over two graphs for readability. Other trend graphics further in this report are split over two graphs for a similar reason.
"Corporate reputation" and "customer loyalty and retention" remain on top of this list. "Customer loyalty and retention" moved down in importance from 2009.
At the other end of the importance continuum are the two global issues. Once again, the lower rankings for these items do not indicate a general disinterest in global issues. Rather, the underlying distribution for each is bimodal, meaning that large numbers of executives think these issues are of great importance while large numbers also think these issues are unimportant.
The remaining items are spread across the top half of the scale, and have about the same ratings they had in 2009. "Being able to adapt quickly to change" has become significantly more important since 2007.
The second question of this section asked how likely it is that an organization will engage in one or more of several possible activities during the next 18 months. Summary results appear in Figure 3.
There were some changes to this question and significant changes in responses. "Relocating outside Indiana" was changed to "expanding outside Indiana" and received the highest rating next to a new question about "green development." "Adding jobs" moved up by more than 0.5 statistically significant rating points since 2009 indicating that some CEOs are planning to hire again, a difference from prior years. Central Indiana companies are more likely to add jobs as are companies with less than $5 million in revenue and those between $10 million and $50 million in revenue. "Outsourcing," "mergers, acquisitions, and alliances," "new sources of financing," and "succession planning" have all moved up significantly from 2009. "Adding jobs" and "reducing jobs" had their worst ratings in 2009. More hiring and fewer layoffs are indicated for 2010.
Trends of responses to these questions can be seen in Figure 4a and Figure 4b.
Most items seem to be moving in an optimistic direction from 2009, especially "adding jobs" and "reducing jobs" although these two items are significantly different than 2007.
The third question of this section asks about "how challenging" several issues are to executives and/or their organizations. Summary results appear in Figure 5.
"Having enough time" is once again perceived to be the most challenging of seven issues from our respondents' perspectives.
"Keeping up with technology" is higher than it was in 2009 by 0.21 rating points although it is significantly less challenging than it was in 2007.
The other items show no statistically significant difference from 2009.
Trends in responses to these challenges can be seen in Figure 6a and Figure 6b.
"Human resources" fell in 2009 and has only slightly recovered. "Rising shareholder expectations" and "global business issues" both fell slightly in 2010. "Global Business Issues" was not asked in 2007.
We asked an open-ended question in the survey (Q4) to determine whether there are important issues on the minds of respondents which are not reflected in the first three questions. One hundred forty-five respondents answered this question. Most comments were concerns about
- government regulation and taxes;
- reduced revenues; and
- health insurance costs.
Given the magnitude of the economic downturn, respondents were asked several questions related to their opinions about the economic downturn and their organization’s response to it. Results appear in Figure 7.
As a follow-up question (Q6), respondents were asked to elaborate on what specific activities, if any, their organizations are taking "in response to current economic conditions." A total of 238 (56 percent) responded to this question, which is a relatively high percentage for an open-ended question. Most comments mentioned
- cost reduction and budget control
- terminations not layoffs and
- more emphasis on sales.
