KPMG’s Global CEO Outlook Report illustrates the principle that nothing in business or technology follows a straight line or a constant trajectory. And that seems especially true when the macro environment throws challenges.
Executives who participated say that although they remain committed to “digital transformation,” they also expect to pause or reduce effort over the near term as they expect a recession to hit that will pressure their firms financially.
When leaders expect revenues to fall, attention always turns to the cost side of the business model. And even if leaders say they expect “digital transformation” (ignore the hype, just call it applied technology) to help on both revenue and cost sides of the business, the long-term goal will bend under the pressure of short-term financial stress.
At this point, it would be a rare executive indeed--in the connectivity, software, applications or computing businesses--who is not preparing now for a recession in 2023. There could be a bright side.
Periods of financial excess always lead to sloppy operations, thinking and execution. It can be argued that a decades-long period of zero cost of capital has led to some business decisions that will prove unwise as real costs of capital rise, and as a recession wrings weaker providers out of the market.
Leader focus is about to shift to execution and fundamentals. Been there, done that.
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