Canadian CEOs are less optimistic about the global economy and their growth prospects than last year. When CEOs lose confidence, it’s time to move ahead carefully and evolve business models and ways of working that no longer serve their organizations.
Last year, Canadian CEOs were overly optimistic outliers, citing record levels of confidence in the global economy and growth within their own organizations. Faced with a challenging operating environment, their confidence has dropped significantly this year, putting them more in line with global sentiment. While confidence in the year ahead hasn’t shifted drastically over last year, the long-term outlook is on shakier ground: only 40% are very confident about revenue growth over the next three years, down from 58% in 2018.
This year presents Canadian CEOs with an opportunity to differentiate themselves from the competition as they transform their businesses and engage with consumers in new ways.
The Canadian economy entered 2018 on a high, with unemployment near a 40-year low and the country posting 3% GDP growth the year before. But entering 2019, Canadian CEOs are extremely concerned about more issues than last year, and the pressing threats are less existential (e.g. terrorism) and more related to business (e.g. protectionism, trade and skills). Canada’s economic fate has often been tied to global economic whims, and the road to a renegotiated North American Free Trade Agreement and US trade disputes have perhaps proven Canadian business shouldn’t expect smooth sailing in the years ahead.
When asked to identify the most attractive foreign markets for investment, Canadian CEOs are looking farther afield and expressing more uncertainty. Fewer Canadian CEOs see the United States as the most important market for growth, and likewise, American business leaders say they’re less likely to feel the same about Canada. In fact, with the exception of Mexico, Canadian interest in any market outside Canada has remained flat or declined.
Old ways of working no longer fit new market realities. As concerns around trade loom, Canadian CEOs are looking inward for revenue growth. They see operational efficiencies and organic growth as their biggest opportunities in the year ahead. In a low-growth environment, CEOs who focus on customer needs and creating unique and seamless experiences will come out on top.
Those who do that will deliver customer experiences that grow their business and brand. What’s more, those who enable their operations through technology will reach new heights of customer understanding and operational efficiency. Thriving means constantly adapting. It’s important to remember that companies that aren’t fully dedicated to transforming can quickly fall behind.
Is your growth strategy in line with your current operating environment and changing consumer trends?
Entering 2019, Canadian CEOs are experiencing an economic reality check. As concerns around geopolitical uncertainty and trade loom, they’re increasingly looking inward for organic growth and efficiencies.