Actions business leaders are taking to grow in 2020

Global business leaders are potentially facing an execution challenge in order to ensure future success in the coming decade. According to a new study, a majority of business leaders are looking to downsize costs and make their organisations more efficient in anticipation of looming crises in 2020.

Growth has been sluggish across a number of the world’s global economies in recent years. With several nations having apparently flirted with recession in 2019, the new year has dawned with a series of make-or-break challenges on the economic horizon. Trade wars between the US and China, Brexit and the outbreak of the Coronavirus all pose serious questions to the interconnected global market. Now, a new study from HLB, an international audit and advisory network with offices in more than 150 countries, has highlighted how businesses plan to contend with the mounting challenges of 2020.

Between September and November 2019, HLB collected 368 survey responses from business leaders across 55 countries and a range of industry backgrounds. One key finding was that while respondents had a broadly upbeat view about their individual prospects – 87% have confidence in their ability to grow their businesses in the next 12 months – they are significantly less optimistic about the global economy, with only 16% stating they think growth rates will increase in 2020.

While undoubtedly this is partially because, in a world of disconnected statistics, nobody ever seems to think that the worst could happen to them, companies are also putting plans in place to adapt to the headwinds they expect to be most harmful in their field. According to almost a quarter of CFOs and a majority of CEOs, this means their organisation is currently prioritising the improvement of operational efficiency – tightening their belts in order to prepare for leaner times ahead.

At the same time, 55% of CEOs also said their firms were focusing on building organic growth – perhaps in the knowledge that in an inflated M&A marketplace, fuelling growth by purchasing new firms is set to become an unsustainable risk for all but the largest entities. In order to do this, 52% of CEOs said their organisations were looking to launch new products or services, securing new customers in the process, while yet again CFOs emphasised cost cutting – with 49% of respondents prioritising reduction excercises.

Commenting on the findings, HLB CEO Marco Donzelli said, “In times of profound continued uncertainty, it comes as no surprise that business leaders are cautious about what is ahead. This new decade will see further accelerated change in terms of technology, business models and growth markets. But it will be those leaders that innovate and adapt quickly that will reap the most rewards.”