Dig deep into Vistage’s Q2 2023 CEO Confidence Index Report with guest Joe Galvin, Chief Research Officer at Vistage Worldwide. Informed decision-making is crucial to the success of any business, so before you solidify your 2024-2025 strategy, get insights from Vistage’s trusted CEOs and executives and learn some best practices for embracing all the new world of work has to offer.
GUEST AT A GLANCE
Joe Galvin, Chief Research Officer at Vistage Worldwide, provides CEOs with credible, data-driven thought leadership. Vistage, a trusted resource for research and expert perspectives, offers impactful business insights tailored to small and mid-sized businesses.
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THE LATEST PROGNOSIS
Over the past two decades, Vistage, a community of small and mid-sized business CEOs and key executives, has been regularly surveyed on their thoughts about the economy, providing a breakdown of the latest insights into the minds of business leaders. According to guest Joe Galvin, when combined with traditional economic analysis, this sentiment data becomes a crucial tool for strategic planning, offering a clear direction for the next three to four quarters.
So, what’s the prognosis from this most recent report? According to the Q2 Vistage CEO Confidence Index Survey, buckle up for a steady ride in the coming quarters. Galvin predicts that we’ll settle into a holding pattern until late 2024, with early signs hinting at a rise. However, there’s light at the end of the tunnel. We can set our sights on 2025 to be the year of return to growth.
PODCAST EPISODE HIGHLIGHTS
Our New Reality
“I think when you’re confident in your business, confident in your marketplace, you hire people. Following the trauma of the pandemic years, when we saw just incredible swings from bottom to top and back to bottom, we’ve fallen into what I define as a ‘new reality.’ It’s not a new normal. It’s not the next normal. This is a completely new reality. […] You’ve got these new dynamics driving the economy and, quite frankly, a little bit of post-traumatic stress from the pandemic years, and it creates an environment where there’s a fair degree of uncertainty.”
Reverse Musical Chairs
“If people have jobs, they’re spending. And if they’re confident that if they lose their jobs, they can find another job quickly, they’ll continue to spend. But it comes back to that old Ronald Reagan joke, right? A recession’s when your neighbor loses his job, a depression’s when you lose yours. Well, right now, except for a little bit of the strikes, no one’s really losing their job. And if they do, there’s still excess capacity that they can find a job very quickly. […] Now it’s like a game of reverse musical chairs, right? In 2008, you’d take away a chair and you’d eliminate people. Now, we add chairs, but we don’t add people. It creates tremendous opportunity for the workforce.”
The Rise of AI
“As we came into Q2, there was no question that [AI] was top of mind for everyone. You know, if we go back and we look back to when ChatGPT was released in November, all of a sudden you get to the first year and that’s all everybody wants to talk about. So there was a tremendous amount of energy and a tremendous amount of curiosity in our community. So we asked a series of questions to get their insights in terms of how they’re using it, what they’re doing. […] And it’s clear that right now there is much greater energy behind individual utilization than there is behind an organization’s ability to leverage AI.”
Getting It Out in the Open
“Well, you bring up an interesting point because there’s a data point — it’s not ours, but I saw they said 88% of workers either are using or have tried [AI tools] in some sense. 69% are afraid to tell their boss about it. So what does that say? That means that people are using this — whether or not they’re acknowledging it or not is another thing. And to your point, yeah, there’s a fair amount of uncertainty and fear, if you will, about what this is and where it’s going to go. I mean, we’re a long way from Skynet and the Terminator and all that stuff, but at the same time, it’s real and it’s active.”
Leading the AI Charge
“AI is not going to replace people. It’s going to augment people. Automation replaces people. […] I think the trepidation has to be put aside and recognize that not only is it a boost for the productivity of your people, it also becomes a powerful retention tool. Because one of the things we know about the millennials, and now the pesky Gen Z generation, is they don’t want to work with old technology. Nobody wants to spend time on an SQL forms-based 2001-type thing. They want to learn. They want to be on Salesforce. They want to be on workplace apps. They want to be using AI. And if you’re not providing that — again, in this environment where people can change jobs more quickly and eat more easily than ever before — if you’re not providing that, it becomes a risk to your workforce and will impact your retention rate.”
Looking Toward 2024
“The overall sentiment is consistent with a soft landing. […] If you’ve been in housing, if you’re in commercial construction and industries connected to that, you’re probably feeling some pain. Those are clearly already in a recession. There are other aspects — technology, professional services, obviously, the healthcare industry — those are all thriving. So I think the sentiment is one of cautious-ism, if that’s actually a word. […] The media has been predicting a recession for the last two years. And all we’ve seen is it’s pretty stable, solid growth. And I think we’ll continue to see that. Obviously, there are some factors coming into play that will make 2024 I think a soft, flat, maybe a slightly down year, but I’m also an optimist by nature. I think too, we’ll see a real pivot toward growth as we move into ‘25, ‘26 and ‘27.”
Making Better Decisions
“When you combine what CEOs are thinking and feeling with the hard data that comes from economists, you now have got this really composite view of where we are, both in terms of what actual CEOs think and what the hard data says in projection, and that gives you a platform to make better decisions. We think that CEOs are in the business of making decisions, and the better information you have, the better decisions you’ll make, the better you’ll position your business to grow — because we count on CEOs to make great decisions that are going to benefit their companies, the people that work for them, and the communities that those people work in.”
LEARN MORE
Check out more of Joe Galvin’s content by connecting with him on LinkedIn, or get an in-depth view of the Q2 2023 CEO Confidence Index Report here.