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Global CEOs Remain Optimistic Over the Next 3 Years and Look to be the Disruptor

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KPMG International released its 2017 Global CEO Outlook, based on in-depth interviews with nearly 1,300 CEOs of some of the world’s largest companies. This year’s CEO Outlook reveals that 65 percent of CEOs see disruptive forces as an opportunity, not a threat, for their business. CEOs are still broadly confident about the prospects for the global economy, but their optimism is more modest than it was last year, with 65 percent expressing confidence compared with 80 percent last year.

“Disruption has become a fact of life for CEOs and their businesses as they respond to heightened uncertainty,” says John Veihmeyer, Global Chairman of KPMG. “But importantly, most see disruption as an opportunity to transform their business model, develop new products and services, and reshape their business so it is more successful than ever before. In the face of new challenges and uncertainties, CEOs are feeling urgency to ‘disrupt and grow’.”

Highlights of KPMG’s 2017 Global CEO Outlook

KPMG’s 2017 Global CEO Outlook report provides insights of global CEOs’ expectations for business growth, the challenges they face and their strategies to chart organizational success over the next 3 years. Key findings include:

  • In 2017, CEOs are still broadly confident about the prospects for the global economy (65 percent), but their optimism is more modest than it was last year (80 percent).
  • More than six in 10 CEOs (65 percent) see disruption as an opportunity, not a threat, for their business. Three in four (74 percent) say their business is aiming to be the disruptor in its sector.
  • Within their own businesses, more than eight in 10 CEOs (83 percent) describe themselves as confident in their company’s growth prospects for the next 3 years, with around half (47 percent) saying they are very confident.
  • Almost seven in 10 (68 percent) say they are evolving their skills and personal qualities to better lead their business.
  • As they adopt cognitive technologies, businesses are expecting short-term headcount growth. Across 10 key roles, an average of 58 percent of CEOs are expecting a slight or significant growth in numbers.
  • Close to half (45 percent) say their customer insight is hindered by a lack of quality data. More than half (56 percent) are concerned about the data they are basing decisions on.

“CEOs understand that speed to market and innovation are strategic priorities for growth in uncertain conditions,” says Veihmeyer. “At the same time, they are being pragmatic about managing uncertainty – this includes strengthening their business in established markets so they can protect their bottom line while preparing to seize new opportunities.”

A changing geopolitical climate

The annual study by KPMG International of nearly 1,300 CEOs from companies across 11 industries in 10 countries found that many CEOs are focused on geopolitical challenges:

  • 43 percent of CEOs are reassessing their global footprint as a result of the changing pace of globalization and protectionism.
  • 52 percent believe the political landscape has had a greater impact on their organization than they have seen for many years.
  • 31 percent think protectionist policies in their country will rise in the next 3 years.

The evolving risk landscape

One of the most striking changes in this year’s survey is the rise in the number of CEOs who cite reputational and brand risk as a top current concern. This is the third most important risk (out of 16 in total), after not featuring in the top 10 in 2016. CEOs also see reputation and brand risk as having the second biggest potential impact on growth over the next 3 years, which is a change in ranking from seventh out of 10 in 2016.

Cyber security, which CEOs ranked at the top risk in 2016, has this year fallen to position 5 (of 16), in part, reflecting CEO views on the progress their business has made in cyber risk management. Today, four in 10 (42 percent) say they feel adequately prepared for a cyber event – up from 25 percent in 2016.

Technology challenges – a battle for talent

Contrary to popular view, on average, 58 percent of CEOs actually expect cognitive technologies to increase headcount across 10 key types of roles in the immediate future. While 32 percent expect this growth to be slight, there is still a clear expectation that more specialist employees will be needed, at least in the short term. This would suggest that client experience, not cost reduction, is seen by CEOs as a key driver in adopting cognitive technologies. Attracting highly skilled talent – instead of managing technical issues around the technology itself – is seen by CEOs as the top challenge in implementing cognitive technologies.

More generally, CEOs expect headcounts to continue growing, but to grow at a slower pace than expected in 2016. Last year, 73 percent of CEOs expected their number of employees to increase by more than 6 percent in the next 3 years. In 2017, less than half (47 percent) expect this level of growth.

While CEOs are focusing on evolving their businesses, they are also evolving their own role – 70 percent of CEOs say they are now more open to new influences and collaborations than at any other point in their career.

A focus on trust

In light of operating within an increasingly transparent business environment, three quarters of CEOs (74 percent) say their organization is placing greater importance on trust, values and culture in order to sustain its long-term future. CEOs are seeing this trend continue for the immediate future: 65 percent agreed that levels of trust in business will stay the same or decline in the next 3 years.

More than seven in 10 (72 percent) correlate being a more empathetic organization with higher earnings. Companies today are increasingly realizing that building trust is consistent with their business objectives.

To view additional information about the study, please visit their website. You can also follow the conversation @KPMG on Twitter using the hashtag: #CEOoutlook.

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CCCI GMM and Annual Election

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The Cebu Chamber of Commerce and Industry will hold its General Membership Meeting and Annual Election on February 23 at 11:00 am at the Ballroom B & C, Summit Galleria Hotel, Cebu City.

This event is in partnership with UnionPay International (UPI), a global payment network with a wide range of world-class payment products and services. UPI is committed to providing access to value and secure payment solutions that are tailored to the needs of the local market, to enable choice and ease of payment for consumers and businesses alike.

With over 7 billion UnionPay cards issued in 48 countries and regions, over 51 million merchants and 2.57 million ATMs accepting UnionPay cards in 168 countries and regions, UnionPay serves the world’s largest cardholder base and is one of the fastest growing payment networks in the world.

Bannering the theme “Land & Air Transport Updates for Cebu”, this month’s GMM will be graced by the presence of Department of Public Works and Highways Regional Director Ador Canlas and GMR Megawide Chief Executive Advisor Andrew Harrison as esteemed speakers of the event.

For this year’s CCCI Annual Board of Trustees Election, there are eleven (11) positions to be filled. In the service sector, there are four (4) open positions; three (3) for industry; two (2) for trade; one (1) for sectoral and one (1) for the ICT.

All CCCI members are enjoined to actively participate in this coming General Membership Meeting and Annual Election. CCCI members are further encouraged to cast their votes by submitting their filled out and signed ballots on or before 12NN of February 23.

For more inquiries, one may call CCCI at 232 1421 local no. 111 and look for CCCI Membership Development Division Head Joy Lorena Amador.

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CCCI, DOST holds Training on Industrial Calibration on March

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With an aim to leverage the capabalities not just of its members but also the business community in Cebu, CCCI holds a training program dubbed as Training on Industrial Calibration on March 7 to 9 at Department of Science and Technology (DOST) Regional Office 7, Sudlon, Lahug, Cebu City.

In partnership with DOST, the training program aims to introduce its participants the Laws on Metrology in the Philippines and the method on the calibration of the common measuring instruments for mas, temperature, pressure and length.

It further seeks to equip the participants with better understanding of calibration system and the advantages in their production systems.

Registration fee costs Php 6, 000 for CCCI Members while Php 6,500 for Non-CCCI Members, which includes training/ seminar kits, certificate of attendance and meals. Interested participants are required to bring their own laptop for the exercises.

For further inquiries, one may call CCCI at 232-1421 to 24 local no. 109 and look for Ms. Jessa Mae L. Abapo of CCCI’s Business Development and Management Services Divison.

Join CCCI’s two-day HACCP Training!

CCCI is set to conduct a two-day Hazard Analysis and Critical Control Point (HACCP) Training on March 14-15, from 8:30 AM to 5:00 PM, at Department of Science and Technology (DOST) Regional Office 7 located in Sudlon, Lahug, Cebu City.

This training intends to provide businesses in the food industry sector the necessary knowledge and skills on the fundamentals of HACCP.

HACCP is a systematic preventive approach to food safety and pharmaceutical safety that addresses physical, chemical, and biological hazards as a means of prevention rather than finished product inspection. HACCP is also used in the food industry to identify potential food safety hazards, so the key actions, known as Critical Control Points (CCPs) can be taken to reduce or eliminate the potential risks of the identified hazards.

Moreover, the system is used at all stages of food production and handling processes including packaging, distribution, among others.

Registration fee costs Php 5,000 for CCCI Members while Php 6,000 for Non-CCCI Members, which includes training kits, Certificate of Attendance and meals.

For further inquiries, one may call CCCI at 232-1421 to 24 local no. 109 and look for Ms. Jessa Mae L. Abapo of CCCI’s Business Development and Management Services Division.

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South Star Drug Now Accepts GCash in Metro Manila Outlets

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South Star Drug, one of the biggest drugstore chains in the Philippines, becomes the first drugstore in Metro Manila that allows customers to purchase medicines and other items using GCash scan to pay mode of payment.

The medicine retailer has over 450 stores nationwide and still growing.  The use of GCash in South Star Drug’s Metro Manila outlets is being piloted in six branches – two in Pasig (C. Raymundo cor. F. Legaspi, Dr. Sixto Ave.), two in Makati (Herrera, Guadalupe Unimec), one in Pasay (Balabag Merville), and one in Las Pinas (Philamlife).  By end of the year, all South Star Drug outlets are expected to accept GCash scan to pay.

GCash is being operated by Mynt which is owned by Globe Telecom, Ant Financial and Ayala Corp. “Mynt’s partnership with South Star Drug is part of our company’s efforts to make payments more convenient, safer and easier.  This brings us another step closer to our goal of making the Philippines a cashless country,” says Anthony Thomas, Chief Executive Officer of Mynt.

Christine Tueres, General Manager of South Star Drug said:  “South Star is always working to improve customer experience and find ways of doing things better – that includes giving our customers more payment options. With GCash QR code feature, even without cash or credit card, our customers can make a purchase in any of our stores with just a few taps on their smart phones”.

Using GCash is easy.  A customer with an iPhone or an Android smartphone only needs to download or update to the latest version of the GCash App, register for an account, and fund  their GCash wallet at any of over 12,000 GCash Partner Outlets nationwide. This includes Robinsons Business Centers. Once done, the customer just has to tap on Scan QR, point a phone’s camera at the partner’s QR code, and key in the amount to be paid.

 

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Manila Water to expand in Thailand

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Ayala-led Manila Water Company Inc. is venturing into the water industry of Thailand as part of its ongoing expansion in Southeast Asia.

In a disclosure to the Philippine Stock Exchange, Manila Water said it signed Monday a share purchase agreement with Electricity Generating Public Company Limited (EGCO) to acquire its 18.72-percent equity in Thailand-based Eastern Water Resources Development and Management Public Company Limited.

The company intends to finance the transaction through internally generated funds and bank debt.

It said the closing of the acquisition is still subject to the “fulfillment of certain conditions precedent.”

“We recognize the opportunities this new market presents for us, and we are eager to share the technical expertise and service quality which Manila Water has developed over the last 20 years. From the conglomerate perspective, Ayala sees this development as a strategic entry point into Thailand. With Manila Water leading the way, we hope to leverage our various capabilities to enlarge our footprint in the country,” said Ayala President and Chief Operating Officer and Manila Water Board Chairman Fernando Zobel de Ayala.

East Water’s operations are strategically located along the Eastern Economic Corridor which is targeted to be a leading economic zone in the Southeast Asian region.

East Water, a publicly listed company whose shares are traded in the Stock Exchange of Thailand, is engaged in the provision of raw and tap water supply services in the eastern region of Thailand and home to a number of heavy industries, including automotive, electronics and petrochemicals.

“Our entry into the Thailand water space aligns squarely with our internationalization strategy, with focus in Southeast Asia. East Water presents great potential, as its future growth will mainly come from the Eastern Economic Corridor (EEC), the Thai government’s initiative to further develop the country’s eastern seaboard into a leading economic zone in ASEAN,” said Manila Water President and Chief Executive Officer Ferdz dela Cruz.

Manila Water’s entry into Thailand comes after its foray into bulk water and concession projects in Vietnam.

It has also completed pilot projects in Bandung, Indonesia for a non-revenue water reduction program; and in Yangon, Myanmar for leakage reduction.

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