CEOs Support Government and Plan For Growth

CEOs Support Government and Plan For Growth

TEC International, a world organization of CEOs, released a quarterly survey of chief executives who are cautious but determined to make 2003 a better year despite the economy and the turbulent world environment.

According to the Q1 TEC Index, 63 percent of CEOs expect a mild negative impact on their businesses if the United States goes to war with Iraq; 60 percent support war with Iraq even if the United States is not granted full support from the United Nations and its allies.

  • CEOs surveyed are not letting the fear of a potential terrorist attack change their way of life at work or at home, yet nearly 60 percent of CEOs support an increase in government powers of surveillance to augment the nation's homeland security.
  • Nearly 75 percent of CEOs are not planning on taking actions to prepare their company for a potential terrorist attack and have not altered their lifestyle in any way. Of the 28 percent that are taking action, 3 percent will prepare emergency supply and first aid kits, 17 percent are making sure all of their technology and data is secure and 8 percent will initiate an internal crisis action plan.
  • Nearly 60 percent of CEOs surveyed describe the current economic health in the United States as stagnant. Along the same lines, 30 percent of CEOs predict the economy will grow only 1.1-2.0 percent for the full calendar year of 2003.
  • Nearly 50 percent of CEOs report the current state of the economy has led them to reduce operating expenses and modify their business strategy for the next 12 months.

    Brian Beaulieu, chief economist, TEC International, says "...decision makers of the economy are determined to do what is necessary to effectively compete in the global market. Driving down operating costs remains a major objective..."

    Sales revenue predictions for the next 12 months continue to be on a slow rise with 33 percent predicting an increase by less than 10.0 percent. On the whole, 77 percent of CEOs surveyed report sales revenues will increase from 1.0 to more than 20.0 percent in 2003.

    Selected Questions:
    How has the current state of the economy affected your business plans for the next 12 months? Freq.Percent
    Reduced capital expenditures39937%
    Increased capital expenditures12612%
    Reduced operating expenses48645%
    Increased operating expenses12211%
    Modified business strategy55951%
    Delayed new product/service offerings13312%
    No effect17316%
    Do you plan to increase or decrease capital expenditures over the next 12 months?Freq.Percent
    Increase by 1 - 10 percent30429%
    Increase by more than 10 percent12211%
    Decrease by 1 - 10 percent17817%
    Decrease by more than 10 percent959%
    No change36234%
    What are your total sales revenue projections for the next 12 months?Freq.Percent
    Increase by less than 10 percent35433%
    Increase by 10-20 percent29327%
    Increase by more than 20 percent17216%
    Decrease by less than 10 percent868%
    Decrease by 10-20 percent464%
    Decrease by more than 20 percent212%
    No change949%
    What is the most important business strategy that you need to implement in the next 6 months to help your company grow long-term? Freq.Percent
    Reposition company to accelerate growth50646%
    Increase expenditures to accelerate growth14914%
    Decrease expenditures to ensure viability19818%
    Recruit and hire top talent44941%
    Pursue a liquidity event-M&A of IPO545%
    How would war against Iraq impact your business? Freq.Percent
    Not at all455%
    Expect a mild negative impact60763%
    Expect a mild positive impact17718%
    Expect a strong negative impact10010%
    Expect a strong positive impact333%
    In your opinion, which industry will rebound the fastest in 2003? Freq.Percent
    Information Technology33731%
    Professional Services24623%
    Other, please specify525%

    # of respondents: 1090
    # of surveys sent: 4714
    Response rate: 23%
    Margin of Error:
    W/ 95% confidence interval = 3.0%
    W/99% Confidence Interval = 3.9%

    For more information: Jennifer Culter Townsend Inc. for TEC 858.457.4888 Ext. 156

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