As a result of COVID-19, CEOs in India have identified ‘lack of skills and capabilities in IT’ as one of the most significant challenges to growth, and are examining their wider societal contributions and company purpose. In the first study of its kind to measure how CEOs priorities and concerns have changed during the global pandemic, KPMG conducted two surveys, one at the onset of the pandemic in January and another in August 2020.
- One-third of the CEOs in India have confidence in the country’s economic growth
- 62 percent of CEOs altered their own compensation, as part of the broader objective of cost optimisation and cost management to sail through the pandemic
- Supply Chain Risk and Digital Disruption top the list of concerns
- CEOs in India witnessed accelerated progress in digital transformation during the pandemic and are likely to prioritise investments in new technologies to become future-ready.
The KPMG in India 2020 India CEO Outlook: COVID-19 Special Edition report finds that the agenda of leaders has radically shifted since the beginning of the year, as existing trends like cost optimisation strategies, rethinking of supply chain strategy, enhancing ESG programs and aligning with the new work realties have accelerated.
Overall, three key themes emerged from this year’s survey, which we refer to as ‘Propelled by purpose’, ‘Realignment of strategies’ and ‘Accelerated digital transformation’.
Commenting on the findings Arun M. Kumar, Chairman and CEO, KPMG in India said “The significant shift in CEOs priorities that we have witnessed over the last six months reflect the agility with which CEOs had to deal with the challenges of the pandemic. Looking forward, similar to their global counterparts, CEOs in India are less confident about global and domestic economic growth than they were at the onset of the year. Their earnings outlook is clearly challenged.”
Kumar added “The crisis is redefining the standards for corporate leadership. Societal impact is high on the agenda; Environmental, Social & Corporate Governance (ESG) has come into focus. In the context of the pandemic, CEOs in India have recognised the importance of accelerated transition to digital business models. They believe that digital technologies are imperative to maintain customer trust and keep remote workforces connected. Consequently, they are prioritizing investments in new technologies to pave the way for a more sustainable and resilient future.”
Vikram Hosangady, Partner and Head, Clients and Markets, KPMG in India said “Whilst we are still some time away from normalcy, there are some permanent changes to the way businesses will function going forward. The pandemic is another instance of how the new normal is a VUCA world and companies need to be nimble and innovate constantly to succeed. If anything, COVID-19 has only acted as a catalyst to accelerate digital transformation with companies today spending more than what they originally planned for on digitisation in spite of uncertainty in earnings.”
“Companies will resort to Zero-based budgeting on all discretionary spends for the next two- three years and question the very need for some of these spends. This is likely to make them leaner, meaner and significantly more profitable when growth returns. The importance of liquidity and the need to be moderately leveraged is also a key learning from this pandemic, something that companies should look at etching in their business plans for the future.” added Hosangady.
