Seventy-Nine Percent of Senior Executives Anticipate Increasing
Cost Pressure at Their Organizations in the Next Twelve Months
WASHINGTON--(BUSINESS WIRE)--June 4, 2007--The Corporate Executive
Board Company (NASDAQ: EXBD) today announced the second quarter
results of its Business Barometer survey of business conditions at the
world's largest organizations. The Barometer takes advantage of the
Corporate Executive Board's access to a unique membership of senior
executives by evaluating 28 leading indicators of business performance
across sourcing, manufacturing and distribution functions.
Faced with heightened economic uncertainty, senior executives
maintain a positive growth outlook, but nearly 80 percent anticipate
increasing cost pressure in the next 12 months. While some companies
are in outright cost-cutting mode, executives forecast increased
capital expenditure and staffing levels. Key findings include:
-- Cutting Expenses Rather than Business Investment: While 50
percent of Chief Financial Officers anticipate lower General &
Administrative expenses, more than 60 percent forecast higher
capital expenditure levels. Sixty-three percent of Chief
Information Officers forecast growth in discretionary
IT-related capital expenditures.
-- Cost Pressure Most Acute in Frontline Functions: Anticipated
cost pressure is most acute in customer- and supplier-facing
functions such as Supply Chain, Procurement, and Sales; more
centralized staff functions such as Finance and IT forecast
more moderate increases in cost pressure.
-- Increasingly Competitive Customer and Labor Markets: Nearly 60
percent of Heads of Sales anticipate increased reliance on
discounts or financial incentives in the next 12 months, while
51 percent of Chief Human Resources Officers expect an
increase in unwanted staff turnover.
Corporate Executive Board Senior Director Michael Griffin says,
"The results of the Barometer reflect the desire of senior executives
to build flexibility into business plans and ensure effective
responses to uncertain economic conditions. The forecasted increase in
capital expenditure and staffing levels, viewed in light of expected
reductions in general and administrative expenses, indicates a
cautious posture toward top-line growth."
More than 350 senior executives at the world's largest
organizations in North America, Europe and Australia participated in
the Corporate Executive Board's Business Barometer survey in May 2007.
About the Corporate Executive Board
The Corporate Executive Board Company (NASDAQ: EXBD) is a leading
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of the Fortune 500. These services include best practices research
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CONTACT: Corporate Executive Board
Megan Sowder, 202-777-9029
SOURCE: Corporate Executive Board