McKinsey Survey: Improving outlook of global executives revealed
The improving global economic environment is clearly shown in the renewed optimism of some 1,904 executives who are expecting to rake in higher profits in the near term, according to the latest results of the McKinsey survey released this month.
McKinsey said that this only shows that companies all over the world have fairly adjusted and coping to the challenges of the financial environment since the financial meltdown and contagion occurred two years ago.
Company executives surveyed showed that compared with 42 percent recorded a year ago, companies are now not only expecting to break-even but to earn higher now.
McKinsey noted that one important aspect which reveals that companies have adapted to the current financial regulations and belt-tightening measures is their way of assessing risk.
It said that capital-investment decisions and due diligence are now more rigorously done.
McKinsey's survey showed that "57 percent of respondents say their companies have changed the criteria by which they make capital-investment decisions, and nearly 70 percent of those say the change has been more rigorous due diligence and some 59 percent have adopted a more conservative risk profile.
Companies are now more vigilant and take painstaking views on risk management, cost management, or conservation of cash.
Another interesting result that suggests companies are coping, if cautiously, is that 38 percent expect to increase the size of their workforce by the end of this year. This is the highest share expecting to hire since before the crisis.
Respondents from different countries expect hiring to be up; those in high tech, telecommunications, and manufacturing are the likeliest to say their companies will hire more in the coming year. There is however, a 23 percent among those large companies surveyed, which expect continued decreases in workforce size.