November 13, 2008
Dallas (SMU) — For the second year, SMU Cox School of Business and DCEO magazine have set out to put a finger on the pulse of business leadership in Dallas with its annual SMU Cox CEO Sentiment Survey™. Invitations to participate in the survey were sent to a comprehensive list of DFW-area CEOs and presidents, with 543 respondents completing the survey.
The timing of the survey coincides with the unraveling financial crisis, as data was collected between August 1 and September 15, 2008. Before this year’s surveys were mailed out, Bear Sterns, Fannie Mae and Freddie Mac all were on shaky ground and bailouts were being considered. As the participants completed the surveys, and the last of the submissions were received, the economic landscape grew darker with an over-night demise of Merrill Lynch, Lehman, and AIG. The press labeled the turn of events as the “Worst Crisis since the Depression.” Therefore, this year’s survey provides a peek into the minds of Dallas’ business leadership at a very critical time.
The survey was compiled and conducted by Miguel Quinones, Marilyn and Leo Corrigan Endowed Professor of Management and Organizations at SMU Cox, and Robert Rasberry, Assistant Professor of Management and Organizations. It covered a range of topics: from the state of the economy to the quality of the DFW labor force, from leadership attributes most critical to success to the top competitive challenges CEOs face.
As part of the survey, participants were asked to nominate their choice for “CEO of the Year” – the top CEO/president currently serving in DFW, based on organizational and DFW community impact. Dallas Mayor Tom Leppert was named CEO of the Year.
“As head of this large and complex organization that is the City of Dallas, Mayor Leppert grapples with all the same issues as for-profit CEOs while at the same time working to create a positive environment that continues to attract jobs and talent to our city. I think our respondents recognize his accomplishments and appreciate the work he does for our city.” said Quinones.
Select findings, at a glance, include:
- When asked to report their economic outlook for the DFW region over the next 12 months, 53 percent continue to believe the “can do” strength of the DFW business community will produce economic improvement in 2009, while another 36 percent believe the regional economy will stay the same.
- o Despite this level of optimism about the economic outlook for DFW, these results represent a drop from the 2007 response where 70 percent of survey participants believed the regional economy would improve over the next 12 months.
- o When asked about the contributing factors that make up our positive quality of life, the low cost of living was cited by 60 percent of those surveyed.
- For 47 percent of those surveyed, the current economic climate is their number one concern, along with the fear of inflation and the reality of a devalued dollar.
- Globally, 39 percent expect to see a further decline in the world economy, and 31 percent believe it will be stable. In contrast, 46 percent of last year’s respondents expected the world economy to improve.
COSTS RISE, REVENUE STABLE
- Compared with last year’s optimistic anticipation of increased capital expenditures, higher staffing levels and increased employment pay, the vision for 2009 has grown bleaker. Predictions show a whopping 80 percent of CEOs predicting costs will increase, 55 percent anticipating stagnant profits, and only 40 percent expecting to see an increase in productivity in their organizations of five percent or more.
- Only 46 percent predict growth for capital expenditures, and 49 percent expect increases in staffing.
- Participants were asked to list their top business challenges for 2009, and as expected, the current economic climate was at the top of the list at 33 percent. In second place was the critical need for a qualified and available labor supply (11 percent), and rounding out the list was domestic competition (eight percent), changing customer needs or expectations (eight percent) and inflation (seven percent).
- When asked about their personal challenges faced as CEOs, sustaining competitive advantage came in first at 68 percent, attracting and retaining good employees was second at 51 percent, and developing leaders was the third greatest challenge at 38 percent.
“Last year our respondents accurately predicted the DFW region would weather the upcoming economic storm,” said Rasberry. “This year over half the CEOs once again believe the local economy will improve over the next 12 months. We hope their optimism prevails through these tumultuous times.”
Comprehensive survey results can be viewed at www.coxceosurvey.org <http://www.coxceosurvey.org/> . The results will also be featured in the December issue of DCEO.
About SMU Cox
SMU’s Cox School of Business offers a full range of business education programs, including BBA, full-time MBA, Professional MBA (PMBA), Executive MBA (EMBA), Master of Science in Management (MSM) and Executive Education. The school also offers a number of unique resources and activities for students, ranging from its Business Leadership Center (BLC), Caruth Institute for Entrepreneurship, Maguire Energy Institute and American Airlines Global Leadership Program (AAGLP) to its Associate Board executive mentoring program and an international alumni network with chapters in more than 20 countries. SMU Cox is ranked among the top business schools nationally and internationally by major publications, including BusinessWeek, The Economist, Financial Times, Forbes, The Wall Street Journal and U.S. News & World Report.
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