The Executive Centre’s Asia-Pacific Business Outlook Survey
Organisational agility is a core differentiator in today’s rapidly changing business environment. Organisations should be agile enough to anticipate fundamental marketplace shifts and reshape their business priorities in response to the market movements. Thus, it is always of vital importance for companies to gauge market views of the overall business climate on the local, regional and global level before they devise and execute their business expansion plans.
Top Destinations Favourable for Business Expansion
According to The Executive Centre’s survey of more than 800 companies in Asia Pacific, on the global level, similar to previous findings, about half of the respondents expected the global economy to remain roughly the same.
But the level of confidence in the economic outlook for the Asia Pacific region as a whole dropped significantly, registering only 64 per cent of respondents confident or very confident in the region’s prospects.
The level of confidence in the outlook for China market also dropped, registering only 56 per cent of respondents confident or very confident in China’s prospects for the coming year..
Nevertheless, China is still ranked the top destination favourable for business expansion, given the Chinese government’s reaffirmation of its commitment to sustainable growth going forward, despite the slowing pace of economic growth.
Singapore climbed to second place, up from third last year, followed by India which also jumped one spot to third. The US joined the Top 5 list as 4th for the first time since 2013 due to its economic upswing, whilst Australia and Japan tied for 5th with Hong Kong close behind.
Challenges and Opportunities
Similar to previous findings, the top two main challenges that most respondents perceived are intense market competition and pressures on prices (24.9 per cent vs 26 per cent last year) for everything from raw materials, commodities to services, as well as uncertain market demand (21.1 per cent vs 18 per cent last year). To tackle the challenges, businesses should place more focuses on business management practices, such as lean operations, product innovation, service quality improvement, and customer retention.
Despite these concerns, 73 per cent of the respondents were optimistic or very optimistic of their business outlook. About 83 per cent of the respondents expected a revenue growth and 79 per cent expected an increase in profitability in the coming year, whilst forming joint ventures, strategic alliances and M&A are their primary approaches for achieving new growth.
However, businesses seem to take a more cautious approach to the investment in human capital. Only 67 per cent of the respondents expected an increase in company’s headcount, falling from 76 per cent registered last year. A majority of respondents indicated that their top priorities would be 1) improving customer relationship 2) generating top-line growth and 3) improving product quality. Ostensibly, 81 per cent of respondents are planning to stay in serviced offices as an integral part of their business strategy to keep their overheads in check as well as enable them to achieve a better cash flow and greater flexibility to react to opportunities as they arise.
Organisational Agility is Key
In today’s global marketplace, with new business opportunities and market conditions continually evolving, there is also increased uncertainty. Achieving agility is a key organisational driver for organisations keen on reducing time to market, fostering innovation and tackling complexity.
Reflective of the organisations interviewed in the survey, it is apparent that a number of businesses are entirely aware of the need to effectively and efficiently change business models, business processes, and technologies to seek internal efficiencies, improve customer service and new product offerings, and secure competitive advantage.
And the continued demand for serviced offices as unveiled in the survey findings represents the growing need of companies for ever-greater agility and speed to respond to the rapidly changing business environment.