The research was conducted with participation of 163 global Energy CEOs from Australia, China, India, Italy, Germany, Japan, France, Spain, UK and US.
Energy CEO’s survey responses reflect the uniquely challenging times presentedby today’s markets for energy players across the value chain. While capital markets insist on dividends and growth, the recent severe downturn in oil prices, coupled with elevated global economy and demand pressures and escalating regulatory requirements, affect all energy segments and present CEOs no easy path.
Thus, Energy CEOs reflect dual priorities to both develop new growth strategies, aswell as reduce cost structures and increase cash flow from operations. Consistentwith these priorities, the top challenges they indicate include the needs to strengthenprocesses and achieve operational excellence, while responding to ongoing regulatoryand market changes in order to ensure financial growth.
Given these tumultuous times, it is not surprisingly that a majority of chief executives inenergy are focusing their time on leading their companies in rethinking their strategies and business models. Asset and business portfolios are being evaluated rigorously to assess fit, including current profitability, upside potential, and having the competitive advantages and position necessary to drive current and future margins. The imperative to drive competitive advantage is leading companies to consider the cost and value impact of their products and services on customers, and whether their business model propositions to customers offer a strong enough solution. The use of alliances and M&A is escalating to create more compelling solutions as well as capture cost reductions through synergies.
Looking ahead, CEOs are seeking to balance risk with the need for new business models to drive growth, recognizing that challenging times require new approaches .And they anticipate thereafter shifting their focus from setting new strategies toensuring their execution.