23 January 2014 | Will Green
Only a third of chief executive officers believe their procurement departments are well prepared for “transformative change”, according to research.
The 2014 PwC Global CEO Survey found 33 per cent of CEOs thought their procurement and sourcing departments were ready for the changes necessary to capitalise on global trends, compared to 56 per cent who felt their finance departments were. Only R&D departments were less ready than procurement in the eyes of bosses, with 28 per cent of CEOs believing they were well prepared.
At the same time, just 6 per cent of CEOs thought supply chain would be the “next big thing” to impact business and society over the next 10 years, with technology and the role of government taking the top spots.
However, 64 per cent of bosses planned to implement a cost reduction initiative in the following 12 months, a quarter of bosses planned to outsource a business process or function, and 14 per cent were planning to “insource” a previously outsourced process.
The survey uncovered three key trends facing firms over the next five years, with technological advances in first place followed by demographic changes and shifts in global economic power.
Dennis Nally, chairman of PwC, said: “Quite simply, everything is now in flux – from where and how people live and work, to the wider social and political contexts in which companies interact with their stakeholders. These developments will create many new opportunities for innovation and growth. But to seize these opportunities, companies must be ready to radically reassess how they function.”
The poll, which involved 1,344 interviews across 68 countries, also revealed 44 per cent of bosses thought the economy would improve over the next 12 months, with just 7 per cent thinking it would deteriorate, compared to 28 per cent who believed it would deteriorate in the 2013 survey.