What Do CEOs Outside of Medtech Think?

It’s always good to know the thoughts and opinions of leaders outside of our industry, especially during a period of turbulence like we have seen during the pandemic over the past two years. There is much good news in The GLG CEO Survey 2022 report where 471 CEOs share their confidence in their own companies and in the global economy. COVID-19 pushed public health to the forefront of everyone’s priorities, especially those who lead our corporations—large and small. GLG is in the business of providing high-level experts from around the world to tell us about how their companies have survived (or not) and what they expect will happen in the next five years. The GLG survey identifies one segment of winners as those organizations that thrive with knowledge-based employees that can work from home independently with well-defined expectations.¹

Optimistic Outlook for 2022
CEOs reported their 2020 and 2021 corporate results and then forecasted their 2022 results by indicating whether or not they were confident, neutral, or had low confidence in their projections (Table 1). Optimism prevailed for 2022, with CEOs reporting strategies such as cost cutting non customer-facing services and employees, streamlining operations, and technology in the buying process to reduce the need to reach out to customer service.

CEOs respect the impact of COVID and spoke of the need for employee retention strategies, strengthening global systems, recruiting a strong bench, and fortifying the supply chain. This was illustrated when GLG asked them their levels of concern with multiple factors, and public health ranked the highest for 2022 (Table 2). Other factors were global competition, climate change, geopolitical uncertainty, and—extremely important for the medical device industry—legislative restrictions.


Employees working from home has not been an easy step for many organizations, and one CEO reported extensive investment in IT infrastructure and cybersecurity to be able to safely implement collaboration tools. As many employees will agree, the challenge related to employee engagement and the development of relationships with customers is an ongoing challenge, especially in medtech.

Internal Investments
CEOs were asked, “In comparison to 2021, how will your organization change its internal investments in 2022?” Responses were aligned with their positive growth expectations for 2022 (Table 3). Most of the CEOs surveyed realigned their internal investments to sales (70 percent) and marketing (66 percent). This represented a shift away from R&D and Innovation (59 percent), which ranked at the top in 2021. Aligned with those shifts was an expectation that employee headcount would increase in 2022 with 49 percent reporting they would slightly increase and 16 percent reporting a large increase. This increase will come at a higher-than-usual cost. In the McKinsey report The CEO agenda in 2022: Harnessing the potential of growth jolts, the authors noted a previously unseen level of employees who have or plan to quit.2 In the U.S., deliberate attrition increased by almost 800,000 since 2020, while forced attrition decreased by almost 400,000 over the same time period. The end result is business organizations need to discover methods to develop talent and improve efficiency at the same time.


Top business priorities for CEOs were digital and technological capabilities (60 percent), customer experience (59 percent), innovation (58 percent), human capital (58 percent), supply chain and logistics (40 percent), cybersecurity and big data (26 percent), and adaptation to uncertain external environments (24 percent). Supply chain concerns are on the front page of many news media sources, but for the CEOs in this study, it came in under 50 percent. When queried, however, 92 percent of the CEOs in this study indicated supply chain issues will continue to have some impact on their businesses and in the global economy well into 2022.

As noted in the McKinsey report, moving forward, executive trailblazers may want to consider a scenario of confidence about growth after COVID-19—and create that scenario as part of their business planning process.

With all the belt-tightening forced by COVID-19, and new best practices developed, could a strong recovery result? What can we do, as medtech leaders, to capitalize on this growth potential? In the 25th annual PwC Global CEO Survey Reimagining the outcomes that matter, they remind us that the IMF forecasts global GDP to increase 4.9 percent in 2022.3 This is a reduction from the healthy 5.9 percent growth forecasted in 2021, but it is still impressive considering the impact of the past two years. The PwC CEO survey (n=4,446) represents global leaders from 89 countries—a reassuring demonstration of confidence about global financial strength.

The PwC consultants who wrote the survey noted, post survey, major global events occurred, such as the surge of the Omicron variant and the COP26 climate change conference in Scotland—both of which could have a negative impact on global economic resilience. But, in the global arena, there is always going to be something with seismic consequence and those factors must be added to the equations CEOs keep running in their heads.

With the exception of CEOs of companies with revenues exceeding $10 billion for which it was the highest risk, climate change was low on the list of CEO concerns in the PwC survey. Other key findings were worries over the ability to maintain talent and concerns cybersecurity could constrain innovation and sales.

The Medi-Vantage Perspective
One CEO client told me she thought the work-from-home model was a good one, but she was worried it was not sustainable. In an industry like medical devices that depends on relationships with surgeons, hospital administrators, nurses, and patients, gaining the insights we need to develop products can be challenging. Voice of the customer has reemerged as a powerful tool to augment those relationships and gain the insights we need to continue developing innovative new products for our medical device customers. 

References

1. bit.ly/mpo220301
2. mck.co/3v363tU
3. pwc.to/3h7ivk6

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Maria Shepherd has more than 20 years of leadership experience in medical device/life-science marketing in small startups and top-tier companies. After her industry career, including her role as vice president of marketing for Oridion Medical, where she boosted the company valuation prior to its acquisition by Medtronic, and director of marketing for Philips Medical, she founded Medi-Vantage. Medi-Vantage provides marketing and business strategy and innovation research for the medical device industry. The firm quantitatively and qualitatively sizes and segments opportunities, evaluates new technologies, provides marketing services, and assesses prospective acquisitions. Shepherd speaks regularly at medtech conferences and can be reached at [email protected]. Visit her website at www.medi-vantage.com.