Amidst a macroeconomic stability and a politically effervescent environment, it is evident that one of the unfinished issues is the full participation of Mexican companies in the globalization process. In this context, businessmen are directing their strategic efforts toward the long-term reinforcement and consolidation of their organizations, according to PricewaterhouseCoopers’ survey “Actions for business consolidation and growth”, which was applied to 100 CEOs and top executives of the most important companies in Mexico.
Mexican businessmen are aware of globalization challenges and their implications; however, and in spite of other internal market problems, 83 percent of the participants expect a favorable business environment for 2008.
According to Juan Manuel Ferrón, PricewaterhouseCoopers Mexico business advisory leader, “it is widely acknowledged, implicitly or explicitly, that markets and stockholders demand that companies guarantee their stockholders and partners a business-oriented management, which is important for the market and also for the stockholders”.
Therefore, according to the participants, corporate governance is the most visible framework providing this guarantee. Even for private companies, the board of directors is becoming an important element.
Manuel Alatriste, PricewaterhouseCoopers Mexico industries leader highlighted “the survey clearly identifies some convergence issues, which show a business culture that is adjusting to new conditions, including a new regulatory framework for public companies and the availability and generalization of tools such as Information Technology (IT), process documentation and, of course, the increasing importance of the boards of directors”.
The issues that emerge as the most important for top management are:
1. Focus on the clients and the market as the positioning vector.
2. Organizational growth, for which alliances or mergers and acquisitions are important tools.
3. Attention to and retention of human capital as a differentiation resource in an increasingly complex market.
4. Development and innovation of products and services and continuous review of production processes.
5. The use of basic tools in the companies such as IT and the documentation and efficiency of processes, as well as the subsequent certifications.
6. Risk management is one of the main concerns expressed by the CEOs.
The key findings of the Mexican CEOs survey include:
- Almost 40 percent of the participants consider that the most vulnerable areas are: their reputation and the trust of their stockholders, which are interrelated.
- 83 percent of the CEOs surveyed indicated they were “confident” to “moderately confident” about 2008.
- 66 percent of the participants perceived the same or less risks for the next three years.
- 91 percent of the companies do not apply properly risk control measures.
- The board of directors, as part of corporate governance, is mentioned by 62 percent of the people surveyed as the decision-making body.
- The concept of corporate governance has a positive connotation: it is associated with transparency (76 mentions), stockholders trust (61) and organizational control (44).
- More than 50 percent of family businesses do not survive the first generational transition.
- The lack of systems security is closely linked to business continuity (63 mentions), information loss (60) or the loss of clients (57).
- 90 percent of the participants think the market is the basic reference for making decisions.
- During the last 10 years, 47 percent of the companies in this sample have gone through an assets sale process, spin-off or merger.