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 four CEO surveys. In the first question, respondents are asked to rate the importance of 11 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 “being able to adapt quickly to change,” received importance ratings that are statistically equal to ratings received in 2010 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 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.
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. Not surprisingly, small companies feel “growing the business internationally” is not important. “Keeping pace with global competition” is not statistically significant between small and large companies.
The remaining items are spread across the top half of the scale, and have about the same ratings they had in 2010.
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.
“Reducing jobs” moved down more than 0.5 statistically significant rating points since 2010 indicating that some CEOs are planning to reduce layoffs. Companies with less than $10 million in revenue are most likely to curtail reducing jobs in the next 18 months. “Adding jobs” and “reducing jobs” had their worst ratings in 2009. More hiring and fewer layoffs are indicated for 2011.
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 2010, especially “adding jobs” and “reducing jobs.”
Fewer businesses will pursue “outsourcing” in 2011.
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.
The items show no statistically significant difference from 2010.
Trends in responses to these challenges can be seen in Figure 6a and Figure 6b.
“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. Two hundred forty-four respondents answered this question. Most comments were concerns about:
- government regulation and taxes;
- a need to maintain reign on costs; and
- uncertainty about 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 seen in Figure 7, “my organization is dipping into its cash reserves to deal with the current economic situation” reduced in concern to CEOs by more than 0.5 rating points. However, CEOs did not agree as strongly with “in 2011 money will be more available than in 2010” as they did to the similar question on the 2010 survey.
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 411 (54 percent) responded to this question, which is a relatively high percentage for an open-ended question. Most comments mentioned:
- switching to Health Savings Accounts or other responses to health care legislation;
- cutting employees and overhead; and
- assigning more responsibilities to fewer people.
