Deloitte Global COO Survey

1
Deloitte Global COO Survey
Summary of Key Results
2
Methodology

• What 2003 Global COO Survey
• Who Chief Operating Officers or equivalent
• How Telephone survey 20 minutes in length
• Where North America US (100 interviews),
  Canada (51 interviews)
• Europe UK (50 interviews), Germany (50
  interviews)
• Asia Pacific Australia (55 interviews), Japan
  (55 interviews)
• When May 8th, 2003 through June 19th, 2003
• Amount 602 completed surveys
• Sample The vertical industries surveyed were
  Finance, Retail, Manufacturing,
  Healthcare/Pharma, Energy and Telecom
• Significance Conducted at the 95 confidence
  level

3
Economy In My Country Over The Next 12 MonthsBy
Country

• US COOs are by far the most optimistic on the
  future economy.

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And what do you envision for the economy in your
country over the next 12 months?
Base US100 UK50 AUS55 JAP55 CAN51
GER50
4
Economy In My Country During The Past 12
MonthsBy Country

• COOs in Japan and Germany tend to say the economy
  in their country is worse now than 12 months ago.

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From your perspective, is the economy in your
country today better, the same or in worse shape
than 12 months ago?
Base US100 UK50 AUS55 JAP55 CAN51
GER50
5
External Influences on My BusinessBy Country
(Top 4 Box Those Answering 7, 8, 9 or 10)

• German and Japanese COOs exhibit most concern
  over their national economies
• German COOs are also concerned about developments
  in political environment in my country

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On a scale of 1 to 10, where 1 means I am not
worried at all about this and 10 means I am
extremely worried about this, please tell me how
worried you are about the following
Base US100 UK50 AUS55 JAP55 CAN51
GER50
6
Company Over The Next 12 Months

• Views on company performance over the next 12
  months are consistently positive 62 of COOs
  predict that company performance will improve in
  the next year

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And for the next 12 months, do you think your
company will be in better shape, worse shape or
be about the same?
Base Total602 NA201 EUR201 A-P200
1b181
7
Company Over The Next 12 MonthsBy Industry

• COOs in telecom were most optimistic regarding
  company performance over the next 12 months

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And for the next 12 months, do you think your
company will be in better shape, worse shape or
be about the same?
Base Fin. Srvces.67 Retail121 Manuf.225
Health/Pharma.59 Energy/Utility57 Telecom28
Other45
8
Political Environment In My Country During The
Past 12 MonthsBy Country

• COOs in the US and Australia believe the
  political environment has gotten better over the
  last 12 months
• German and Japanese COOs overwhelmingly believe
  their political situation has gotten worse

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From your perspective, is the political
environment in your country in better, the same
or worse shape than 12 months ago?
Base US100 UK50 AUS55 JAP55 CAN51
GER50
9
Concern About Developments In Other Political
Environments

• Of those COOs concerned about developments in
  other political environments, the U.S. was the
  country with which they were most concerned

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Which one country are you most concerned about
developments in the political environment?
Base Total272
10
Revenue Growth vs. Cost Reduction (Average)By
Country

• COOs currently place revenue growth and cost
  reduction as being equally important
• US COOs place more emphasis currently on revenue
  growth

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Imagine you have 11 points to distribute between
revenue growth and cost reduction. Please
allocate points to both, the more points to the
more important issue for you
Base US100 UK50 AUS55 JAP55 CAN51
GER50
11
Sources Of Cost ReductionTotal

• The two main sources of cost reduction are
  increased internal productivity/efficiency and
  increased supply chain productivity/efficiency
  much higher priority over reducing head count
  or outsourcing

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In terms of cost cutting, where do you see the
greatest sources of cost reduction in the next
two years?
Base Total602
12
Sources Of Revenue GrowthTotal

• Overall, COOs believe that the retention of
  existing customers and better penetration of
  existing customers are particularly key to
  revenue growth
• Mergers acquisitions were listed last in
  priority

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Where do you see the greatest sources of revenue
growth in the next two years?
Base Total602
13
Sources Of Revenue GrowthBy Country

• By country, Japanese and German COOs particularly
  view developing new products as a source of
  revenue growth
• U.S. COOs ranked entry into new geographic
  markets lowest

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Where do you see the greatest sources of revenue
growth in the next two years?
Base US100 UK50 AUS55 JAP55 CAN51
GER50
14
Objectives Of My CompanyTotal (Top 4 Box Those
Answering 7, 8, 9 or 10)

• Nine out of ten COOs say that customer
  loyalty/satisfaction and quality are key
  strategic objectives

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a b c d e f g h
On a scale of 1 to 10, where 1 means is not at
all important and 10 means is very important,
please rate the following objectives for your
company
Base Total602
15
Agree/Disagree Statements Total

• Two-thirds of COOs believe that corporate
  governance has changed for the better in the last
  12 months

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Please tell me whether or not you agree or
disagree with the following statements I read
out
Base Total602
16
Pricing Products/Services Total

• Most COOs think they will be able to price their
  products/services at the same level over the next
  12 months
• Twenty-three percent of COOs believe they will
  raise prices

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In the next 12 months, do you envision that you
will be able to price your products/services
higher, lower or the same as today?
Base Total602
17
Supplier Pricing Total

• While 23 of COOs believe their own companys
  prices will be higher in the next year, 31
  believe their suppliers prices will be higher

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a
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In the next 12 months, do you envision that the
supplier prices that you will pay will be higher,
lower or the same as today?
Base Total602
18
Supplier PricingBy Industry

• Health/Pharma. COOs in particular expect their
  supplier prices to rise over the next 12 months

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In the next 12 months, do you envision that the
supplier prices that you will pay will be higher,
lower or the same as today?
Base Fin. Srvces.67 Retail121 Manuf.225
Health/Pharma.59 Energy/Utility57 Telecom28
Other45
19
Outsourcing Expectations Total

• Almost one-third of COOs expect to outsource more
  over the next 12 months and 84 will continue to
  outsource

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Do you expect to outsource more, less or the same
amount going forward in the next 12 months?
Base Total602
20
Outsourcing ExpectationsBy Country

• Japanese COOs expect to outsource more in the
  next 12 months, by a wide margin.

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Do you expect to outsource more, less or the same
amount going forward in the next 12 months?
Base US100 UK50 AUS55 JAP55 CAN51
GER50
21
Regions/Countries Outsourcing ToTotal

• One-quarter of our COOs said they were currently
  outsourcing to organizations based in the U.S.

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What regions/countries of the world are you
currently outsourcing to?
Base Total532
22
Priorities In The Past YearTotal

• When asked to prioritize a list of eight issues,
  COOs listed managing costs and developing
  corporate strategy as highest priorities

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From the following list I read out, what have
been your top three priorities in the past year?
Base Total602
23
Public Figure Most Like to Emulate

• We asked our COOs which public figure they would
  like to emulate. The following people were
  mentioned
• Bill Clinton John Paul (The Pope)
• Bill Gates Margaret Thatcher
• Benito Juarez David Beckham
• Colin Powell Nelson Mandela
• Donald Rumsfeld Richard Branson
• Gandhi Ronald Reagan
• George W. Bush Winston Churchhill
• Jack Welsh Tony Blair
• Jesus Christ

What public figure would you most like to
emulate?
Base Total602