No Match Found
Turning optimism into a sustainable plan for the future
While our 2021 CEO Survey finds a generally optimistic outlook, financial services executives are also paying close attention to uncertainty and disruptive forces on the horizon.
This has many looking at ways to boost resilience and growth, with CEOs prioritizing investments in cybersecurity, leadership and talent development and digital transformation.
After a year of disruption, chief executive officers in Canada’s financial services industry are feeling optimistic. Our 24th CEO Survey found they were more optimistic than Canadian CEOs overall and financial services executives worldwide on key questions like their expectations for global economic growth during the next 12 months. A significant portion of Canadian financial services CEOs expect both revenue (79%) and profit (65%) growth during the same time period.
They have good reason for optimism given their strong performance during the past year. But optimism can only go so far, and confidence doesn’t equal a strategy. Financial services CEOs know this, and our survey shows many of them are aware of both challenges and opportunities on the horizon and are looking at ways to boost their resilience and deliver sustainable growth.
of Canadian financial services CEOs believe global economic growth will improve over the next 12 months
The optimistic outlook is leading many Canadian financial services CEOs to explore fresh opportunities to reimagine their operating models and invest for the future. In fact, they were above the national average in plans to invest more in all but one category of investments (supply chain restructuring) explored in our survey this year, with cybersecurity and data privacy, leadership and talent development and digital transformation topping the list of priorities.
Concern about cybersecurity came across very clearly among financial services CEOs who participated in this year’s survey. Almost all (96%) said they were concerned about cyber threats, with 56% expressing extreme concern about the issue.Learn more
As financial services firms adapt to the new world of work, many are taking the opportunity to rethink their organizations from the ground up. High on the list of priorities is talent, with 62% of Canadian financial services CEOs concerned about the availability of key skills.
While financial institutions have been embracing digital transformation for some time, the acceleration of digital interactions has revealed the need to further improve customer journeys and engagement. And with 87% of firms planning to pursue organic growth in the next 12 months, acquiring and deepening relationships with customers will be critical.Learn more
Our survey shows a clear optimism about the global economy by Canadian financial services CEOs and a readiness to invest in key opportunities to drive growth and enhance resilience. But there’s a complex range of factors that are driving their outlook and plans for the future.
Executives are also looking to get ahead of some of the global mega trends reshaping financial services, with many preparing for further challenges and opportunities as the shift to a platform- and ecosystem-based industry continues to create disruption. Financial services CEOs were also broadly more concerned than Canadian respondents overall about key business threats we asked them about this year, like policy uncertainty, taxes and speed of technological change.
What’s behind this when industry executives are otherwise optimistic? One explanation is that we’re in an usual time mixed with change, optimism and uncertainty and financial services CEOs, with their deep insight across Canada’s business and economic landscape, have a window into not only the opportunities ahead but also the potential challenges looming on the horizon.
This more nuanced outlook is leading Canadian financial services executives to look for ways to both tap the new opportunities and build their resilience for the uncertainties ahead, with many focused on pursuing organic growth (87%), operational efficiencies (68%) and launching a new product or service (49%). All of these activities will be critical to financial services firms’ plans to invest for the future.
The focus on cost efficiencies will be important as this will enable new investments by freeing up resources and capacity for CEOs’ top priorities. But while many financial services firms have been focusing on improving their key productivity measures for some time, conventional cost management techniques won’t be as effective in a business environment that has become as complex and uncertain as it is now. Instead, it’s time for a more strategic approach that includes several key elements:
Revisit your strategy: This will help you go down the right path from the start, which will stop you from taking out costs before you’ve decided on the biggest opportunities to win in the market. This includes being deliberate about the customers you want to serve and being clear about your organization’s purpose.
Identify your core differentiating capabilities: This will help you direct resources and investment to what matters most while shifting them away from areas that are no longer a priority.
Connect the dots: Develop a clear, cross-organizational growth and efficiency agenda based on conscious choices for process improvement spanning the back, front and middle office. Now more than ever, it’s important to take an integrated approach to change and transformation with all functions aligned to a common goal.
Reorganize for growth: Automate lower-value tasks where possible to free up your people’s time and energy to support your strategy and sustain the growth you’re targeting.
We can see many of these elements reflected in Canadian financial services CEOs’ responses to our survey and the investment priorities they’ve set out. Investing in cybersecurity supports resilience and secure growth and transformation, while the focus on both leadership and talent and accelerated digitization can help firms find more efficiencies, solve problems in new ways and create unique and engaging customer experiences that meet their needs more seamlessly. By bringing all of these elements together in a strategic and intentional way, they can turn their optimism for 2021 into a sustainable plan for the future.