Mood of the Boardroom: CEOs are investing in people

Despite the rapid digitalisation of the economy, it is evident that people -- whether it is staff or customers -- are still at the forefront of executives' minds. Photo / Getty Images

Staff and customers are still at the forefront of executives' minds

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When surveying business leaders from across almost every industry, priorities vary. But the common thread in each executive's list of their top three business priorities for the next 12 months is the importance of personnel.

For some, that means "culture change to improve performance". For others, "attracting, and investing in, talent". And for many, it is simply a matter of retaining the staff they already have.

The "people priority" is reflected in broader business conditions in other parts of the Mood of the Boardroom survey, with 60 CEOs sharing their broader investment intentions on the back of what 54 per cent of respondents say is an improved corporate outlook.

Among 19 domestic factors considered to have an impact on business confidence, skills and labour shortages ranked fourth. When CEOs were asked which of three issues were most likely to keep them up at night, "sourcing and retaining skilled staff" was selected by almost 50 per cent.

Despite the rapid digitalisation of the economy, it is evident that people -- whether it is staff or customers -- are still at the forefront of executives' minds.

A legal firm boss said, "We are a services business: we have no material investments other than in our people."

Information technology vendors can expect a busy year with about one in five CEOs listing IT in their investment intentions.

Hawkins Group CEO Geoff Hunt says his investment plans include staff development, recruitment and IT systems.

The leader of a real estate business says his company will invest in information technology to cover areas where legislation affects the business, including anti-money laundering systems. A leader of a power company expects to spend money on "smarter systems".

"Radically change the customer experience through embracing digital," was the clear priority for one food and beverage CEO.

Spark NZ managing director Simon Moutter says he is investing in anticipation of growing demand for services. He says Spark will "continue to invest to meet rising demand for data and digital services".

Chorus, which operates in telecommunications at the wholesale level, says it will invest in increased capacity but, as chief executive Mark Ratcliffe points out, his company's capital expenditure is committed by the UFB contract with the Government over the medium term.

When CEOs were asked which of three issues were most likely to keep them up at night, "sourcing and retaining skilled staff" was selected by almost 50 per cent.

Geoff Hunt

Some export-led industries underline the confidence.

Port of Tauranga chief executive Mark Cairns plans large-scale investment. He says: "We are at the conclusion of a $350 million capital expansion programme to make Port of Tauranga big ship-capable. The New Zealand Shippers Council estimates this will unlock more than $300 million in benefits to exporters and importers every year.

"The first 9500 TEU (20-foot equivalent container) ship is scheduled to make its sole Australasian call into Tauranga early next month, offering exporters an express direct route into North Asia."

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