A PricewaterhouseCoopers news release said increasing health care and pension costs was chosen by 34% of respondents. An overwhelming majority (82%) of CEO’s surveyed complained about how hard it is to keep key employees in the corporate fold.
According to the news release, other key potential business roadblocks on the horizon chosen by respondents included:
- developing new products and services – 52%,
- expansion to new markets – 36%,
- increased competition – 30%,
- increased regulation – 22%,
- managing succession – 20%, and
- positioning the business to monetize its assets – 17%.
When it comes to the issue of their own succession, most CEOs polled said they expect to be acquired by another company. They place relatively low priority on planning for this significant event, or their own successor – a situation that is even more true for family-owned firms. For these companies, only 47% of CEOs have an estate plan that addresses the disposition of the business, and only 22% have revised it within the last two to five years, PricewaterhouseCoopers found.
“These CEOs are focused first and foremost on the pressing needs of the moment, rather than what may be perceived as distant endgame issues having to do with positioning the business for a sale, or who will eventually succeed them,” said PricewaterhouseCoopers Private Company Services partner Alfred Peguero, in the news release. “For family-owned businesses that have been involved in transition planning, serious problems can occur if the transition has not been carefully planned and communicated to family members.”
CEOs expecting to eventually sell to another company are from companies that are comparatively faster growers – targeting a revenue increase of 21.5% over the next 12 months, or 34% faster than companies with all other exit strategies. Those considering an IPO as a possible exit plan expect much faster company growth (35.9%) compared to those anticipating sale/transition to family members (16.4%).
The poll was developed and compiled with assistance from the opinion and economic research firm of BSI Global Research for PricewaterhouseCoopers. For more information about Barometer surveys, go to: www.barometersurveys.com .
« Organizational Change is Increasingly Disruptive