IBM Survey: CEOs To Focus More On Revenue Growth

An overwhelming number of CEOs around the world are now more focused on growing revenue than slashing costs.

February 24, 2004

2 Min Read
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An overwhelming number of CEOs around the world are now more focused on growing revenue than slashing costs and want to be more flexible to keep up with changing customer needs, according to an IBM Business Consulting Services global survey. Results of the study, released at a New York news conference Monday, also found that six out of 10 CEOs said limited internal skills or leadership are inhibiting their company's ability to change with the market.

"CEOs are genuinely looking to embark on big change," said Eric Pelander, global and Americas leader of strategy and change services at IBM's Business Consulting Services unit.

The IBM survey questioned more than 450 CEOs of midsize to large companies around the globe--mostly in face-to-face interviews--on a variety of issues surrounding their business plans and models. Executives from the Armonk, N.Y.-based computer giant said the survey found 80 percent of CEOs saying their business priorities have shifted from cutting costs to growing revenue.

The survey results also found that two-thirds of CEOs questioned said they expect growth to come from new products they'll develop over the next five years, and that eight out of 10 CEOs said their ability to respond rapidly to changing business environments over the next five years is a high priority.

Also according to the survey, 13 percent of CEOs said their own organizations are "very responsive" to changing business conditions, and less than 10 percent said their companies were responsive to their top three threats. In addition, less than 10 percent of CEOs said they believed their company was successful in implementing "change management," according to the survey.The results that showed CEOs want to be more able to quickly adapt and change their business drew the most pointed response from Irving Wladawsky-Berger, IBM's vice president of technology and strategy. He suggested the survey provided validation for IBM's On-Demand computing strategy.

"When you looked at it from the [research] laboratories, we saw incredible advances," Wladawsky-Berger said. "Microprocessors were getting faster. They were less expensive, and they were getting embedded in everything."

Wladawsky-Berger appeared at Monday's press event with several corporate CEOs and other top executives--executives who backed up the survey's findings as well as IBM's On-Demand strategy.

William Pence, senior vice president and CTO of the recently relaunched Napster online music service, said his company is planning on growing its capacity along with its revenue. Napster has engaged IBM "as we look to scale up" and save cost by leasing additional server capacity when needed, as opposed to buying it and maintaining it itself, Pence said.

IBM's On-Demand strategy, Wladawsky-Berger said, is aimed at providing companies with the capability to change their technology on the fly, or "take the technology, and put it to work." "We see a very, very big opportunity to put their technology to work to solve more and more of their business [priorities]," he said.Article appears courtesy of CRN.

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