A survey by KPMG Nigeria has revealed that a significant number of chief executive officers (CEOs) in Nigeria (76 per cent), anticipate that the Nigerian economy will continue on a positive growth trajectory over the next few years.
The executives were even more excited about growth for their industries and companies with all CEOs surveyed expressing increased confidence about their own corporate growth over the next three years.
On the other hand, 84 percent were confident about the growth prospects in the industry they play in.
However, a significant number of CEOs expected moderate corporate growth, just as 88 per cent of the chief executives anticipated topline revenue growth of less than two per cent over the next three years with the same percentage expecting an increase of less than five percent in their headcount in the same time period.
According to the survey findings, organic growth, outsourcing and strategic alliances were identified as key strategies growth for Nigerian CEOs over the next three years.
“Three in five Nigerian CEOs say organic growth is one of their top two strategies for growth while 28 percent rank it first. Twenty eight per cent also agree that outsourcing is key for their growth, but 52 per cent believe strategic alliances with third parties is the second most important strategy overall.
“More than half of Nigerian CEOs (56 percent) intend to set up accelerator programs for start-ups within the next three years to help pursue their growth objectives.
“All Nigerian CEOs in the study believe that technological disruption is more of an opportunity than a threat, and they all agree it is the only significant disruption facing their businesses.
“But many of them state that they are struggling to run parallel processes to transform the digital and non-digital aspects of their businesses,” the report revealed.
In addition, it showed that 88 per cent of Nigerian CEOs believed their digital and technology investments was strategic and long-term, but 64 per cent of them expected to see significant return on such investments in 12 months.
Similarly, 60 per cent of CEOs believed that they were meeting or exceeding their customers’ expectations.
But it appeared there was a struggle to meet the needs of customers of the future as 44 per cent of CEOs admitted they had to reposition their brand to meet the needs of millennials.
Commenting on the report, KPMG Nigeria’s Head of Tax, Regulatory & People Service, Wole Obayomi said, “2017 was a year of recovery for the Nigerian economy as growth started to kick-in from the second quarter of the year.
“The recovery was largely driven by steady rise in oil price, stability of oil production and forex market reform by the Central Bank of Nigeria (CBN) through the importers and exporters (I&E) window.
“If the trend in average oil price increase continues, coupled with stability in the FX market and full implementation of the Government’s Economic Recovery and Growth Plan (ERGP), we expect the economy to attain full recovery and start accelerating.”
Furthermore, Obayomi said, “Every industry is impacted by the dynamic changes in the economy and in my interactions with clients, it is increasingly clear that the prospects for the company is directly linked to the health of their industry.”
On her part, KPMG in Nigeria’s Head of Advisory, Bisi Lamikanra said, “During the recent recession, many companies focused on squeezing a lot of costs out of their businesses.
“They have had to rely on internal efficiency strategies (including outsourcing) and harnessing innovative practices to keep their customers and drive volumes up, while keeping product prices from going through the roof.
“This experience has given companies the confidence to continue to grow their businesses from within.”