Cyberspace, skills conundrum top threats for CEOs

Cyber threats and availability of key skills appear in the top half of CEO concerns in the PwC 2020 Global CEO Survey.

The survey, which comprises input from 1 581 CEOs from 83 countries across the world, including SA, was launched this week at the World Economic Forum annual meeting in Davos, Switzerland.

During a media briefing this morning, officials from the local office of the professional services and advisory firm unpacked the survey results, which identified the 2020 top 15 threats to business growth prospects.

Some of the other threats are: over-regulation, trade conflicts, uncertain economic growth, policy uncertainty, speed of technological change, protectionism and populism, to name a few.

It’s no secret that SA’s pool of talent with critical skills lacks profoundly, with the country often drawing criticism for not doing enough to increase skills development and equip citizens with the necessary skills to thrive in a digital society.

The PwC survey shows this is becoming a growing concern for South African CEOs, with 42% of them, compared to 32% globally, saying they are extremely concerned about the availability of key skills.

Dion Shango, CEO of PwC Africa, said the availability of key skills is a key area that has the potential to undermine the growth prospects of any company. “We see it becoming more challenging to retain people with rare skills and sought-after skills.”

Although upskilling and retraining are highlighted as the best way to close the skills gap, the CEOs reveal they are not making much headway in that area.

The survey shows only 18% of CEOs globally and 6% of South African CEOs have made significant progress in establishing an upskilling programme, a sentiment echoed by workers.

“The fourth industrial revolution has ushered in new business models and new ways of working that require critical new technical, digital and soft skills. Those skills are in very short supply,” noted Shango.

In a separate survey by PwC, 77% of 22 000 workers around the world say they would like to learn new skills or retrain, but only 33% feel they have been given the opportunity to develop digital skills outside their normal duties.

Shirley Machaba, CEO of PwC South Africa, added: “Workers need to be convinced that companies are engaging in upskilling efforts to improve their employability, not just to improve the bottom line.”

According to the survey, most CEOs – 83% globally and 75% in SA – said the increasing complexity of cyber threats is shaping their businesses.

Furthermore, there is growing public concern over data privacy, with 61% of the CEOs globally and 48% locally noting it as a concern.

Machaba explained: “It is becoming increasingly clear that many societies will no longer tolerate self-regulation. CEOs will increasingly need to collaborate with a diverse range of governments to shape appropriate solutions that deploy technology and leverage data in a safe way – one that protects consumers and respects their values while fostering innovation.”

The survey also shows that 78% of CEOs globally, compared to 71% South African CEOs, believe governments will introduce new legislation to regulate the content on both the Internet and social media to break up dominant tech companies.

In addition, 51% of global CEOs and 50% in SA predict governments will increasingly compel the private sector to financially compensate individuals for the personal data they collect.

With SA facing a slowing economy and major companies currently planning job cuts, the survey shows local CEOs are pessimistic about the rate of global economic growth, with 44% believing it will decline over the next 12 months.

Overall, pessimism in the global economy is at all-time high at 53%, the highest level of pessimism since PwC started asking that question in 2012, it says.

“No matter where CEOs look, or from where they are looking, the path is fraught with uncertainty,” stated Shango. “Pessimism among South African CEOs has deepened this year, characterised by a lack of business confidence and a decline in business activity overall. The current state of the economy and socio-political uncertainty is dampening business expectations.

“Despite the current uncertainty, there are still opportunities for South African CEOs to pursue. Faced with uncertainty, business leaders need to act decisively and quickly. Instead of looking inward, they should broaden their field of vision and strive to create a broader range of options to pursue.

“Some of these opportunities include the upskilling, development and training of their people. CEOs also need to look at how they can structure and further enhance their operational efficiencies.

“Making decisions in a way that is more resilient will enable organisations to thrive in the full spectrum of uncertain outcomes.”