Private Companies Underprepared for Cyberattacks
For the first time in five years, CEOs of private companies are more confident of revenue growth in the next 12 months than their public counterparts, according to PwC. They are also more confident about recruiting a larger number people in the year ahead. At the same time, while private companies are more at risk of cyber threats, they seem less prepared to protect themselves against attacks.
These are the main findings from the report Undaunted, but underprepared, part of PwC’s 20th Global Survey of 1,379 CEOs which focuses specifically on the threats and opportunities facing the 781 private company CEOs who participated. 86% are confident about their company's revenue prospects over the next 12 months, up 5% from 81% in 2016. In fact, it's the first time in five years that private company CEO confidence has been higher than that of public company. A further 55% expect to be recruiting more people in the next year, compared to 48% of those heading publicly listed companies.
In contrast, only 30% of private company CEOs believe global growth will increase in the next year, up slightly from 28% in 2015, but down from 37% in 2014, and 43% in 2013. Some 57% of private company CEOs also think it’s getting harder to balance competing in an open global marketplace with trends toward more closed national policies, and this fear is even higher among family-run businesses (66%).
As the private company view of the 20th CEO Survey shows, many of the business issues have remained constant over the last two decades. Talent and overregulation retain top spots on the typical private company CEO’s list of concerns, just as innovation tops the list of strategic priorities. The difference now is the speed and scale of change. In PwC’s view, that means private companies urgently need to focus on three key areas: technology, trust and talent.
Every organisation will be transformed by technology. New technologies are not just changing what companies sell, but also how and where they sell it, how they run their operations, and how they find, manage and communicate with staff. PwC’s Survey shows 29% of private company CEOs believe that technology has already completely reshaped competition in their industry, higher than publicly listed companies (25%). And as many as 74% of private companies expect their markets to be transformed by technology over the next five years. While 74% of public companies are worried about accelerating technological change, and 65% about cyber threats, private companies, by contrast, register 68% and 59%, respectively.
All CEO respondents agree that the biggest threat to stakeholder trust in their business is the risk of breaches in data privacy and ethics, and this is also the number one concern among private company CEOs, scoring 55%. The score for family firms is much lower, at 45%. This year, 60% of private company respondents told PwC they are rethinking their HR function, and 77% have changed their people strategy at least to some extent to reflect the skills and employment structures they need for the future.