A widely followed measure of CEO confidence levels turned somewhat concerning in Q4. The implications for ongoing or planned supply chain management transformation initiatives is one for being very definitive in goal-setting and timing.
The Conference Board Measure of CEO Confidence©, a widely followed indicator of broad CEO confidence levels reflected a more concerning perspective in the latest Q4 polling. The headline reflected confidence levels declining to the lowest levels in six years.
The survey involving upwards of 800 CEO’s across the globe reflects top of mind CEO concerns, and the latest Q4-2018 survey quarter included concerns related to the possibilities of global recession. Other concerns were noted as apprehension about growth prospects for the U.S., while sentiment regarding China and Europe reportedly grew more pessimistic.
According to reporting by The Wall Street Journal regarding the survey, this latest data is a dramatic reversal from sentiment levels a year ago when a recession risk was sanguine.
From our Supply Chain Matters lens, the headline has important context for plans related to supply chain digital transformation or other transformational initiatives that have multi-year roadmaps.
As was noted in our fifth of 2019 Predictions for Industry and Global Supply Chains, advanced investment initiatives need to be guided by short and longer-term line of business alignment needs. In the context of the C-Suite now being more cautious relative the growing number of uncertainties for global markets, senior supply chain executives will need to insure not only the existence of broad vision but have very definitive planning related to interim milestones and their monetary and customer benefits. While innovation-at-scale remains a competitive mandate for many industries and individual businesses, hands-on executive leadership at the highest levels will now likely be reflected in a more cautious lens.
That is not to reflect a derailing of broad vision and tactical initiative milestones but rather an interim focus on the most obvious opportunities for return on investment in either financial or customer service dimensions. Expected results need to be very definitive and measurable for each tactical initiative, addressing obvious line-of-business opportunities for added business, service-levels or compelling productivity and cost savings. Visionary CEO’s who understand the strategic value of supply chain management transformation will likely not be swayed but will likely seek measurable phases of transformation.
Obviously the signposts point to an environment where wholesale rip and replace of business processes and enabling technology will likely not be tolerated. Instead, addressing specific business pain points with augmenting technology that has a reasonable cost and can be quickly implemented will have support if the benefits are definitive and the risk is very manageable.
Industry supply chain management teams should take note of these C-Suite indicators in planning and executing initiatives in the coming months. The notions should not be to stop the majority of improvement efforts but rather be selective, clear and definitive on what can and should be undertaken for transformation in the coming year.
© Copyright 2019, The Ferrari Consulting and Research Group and the Supply Chain Matters® blog. All rights reserved.