2021 Business Leaders Outlook
Source: J.P. Morgan
Business leaders began 2020 with optimism for continued economic expansion, but growing global complexities were a source of uncertainty. By mid-March, the surging COVID-19 pandemic impacted all sectors of the economy and executives quickly adopted new approaches to maintain business resiliency.
Ten months later, the 2021 Business Leaders Outlook reports that leaders of midsize U.S. businesses are voicing optimism about growth in 2021 even as they plan for continued economic unpredictability. This points to confidence in how they pivoted throughout the year. Executives accelerated technology adoption, launched new e-commerce opportunities, reset supply chains and realized value from digital platforms adapted to remote workforces.
But the road ahead in 2021 is not just about surviving the challenges of the past year. Business leaders adopted a new set of business practices forged in crisis that are likely to change the way they innovate and operate for years to come. Executives also told us they’re thinking about more than just day-to-day operations. They’re focusing more on causes that matter to their communities, employees and other key stakeholders.
Read on to learn how business leaders plan to deal with ongoing challenges and capitalize on new opportunities in 2021.
Most companies are optimistic about their own performance, with more than half operating above 80% of their pre-pandemic capacity and 17% exceeding it.
“Businesses were forced to make new and unexpected pivots last year, including accelerating their adoption of new processes, technology and contingency plans. Companies best positioned for success in 2021 will be those that focus on remaining nimble amid continued volatility and evolving consumer demands.”
—John Simmons, Head of Middle Market Banking & Specialized Industries, Commercial Banking
OUTLOOK OVERVIEW
The sudden and transformative impact of COVID-19 has created a backdrop of uncertainty for the coming year, but it’s also sparked ingenuity, resiliency and, ultimately, optimism across industries.
What leaders see
Nearly 12 months since the first cases of COVID-19 were reported, more than three-quarters of midsize U.S. companies are operating near their pre-pandemic capacity—though nearly two-thirds ranked uncertain economic conditions as their top challenge in 2021. Notably, by late November, business leaders had become considerably more confident than at midyear.
Company performance
Industry performance
Local economy
National economy
Global economy
Expectations for their companies
Business leaders anticipate headwinds in 2021, but have improved their outlook significantly since the spring. Capital expenditure forecasts are restrained from a year ago, but most business leaders expect roughly even revenues/sales and profits.
2021 STRATEGIES
Opportunities abound in 2021 despite slowing economic growth.
What our experts see
The 2021 Business Leaders Outlook survey offers a timely look at top-of-mind issues for companies now and in the year ahead. To help you navigate these fast-changing times, keep these considerations in mind:
- Prepare for some bumps in the road to normalcy
COVID-19 has created a volatile business cycle with sharp downturns and quick but uneven recoveries. As businesses adapt to the new economic landscape, they should have strong contingency plans in place that can be activated quickly.
- Embrace technology
While implementing new digital banking tools and processes may seem time-consuming, many can be implemented quickly and easily, providing benefits that include improved data and insights, future-proofed systems and increased operational efficiency.
- Remain vigilant
As companies support greater remote work capabilities and digital processes, they should develop additional business resiliency strategies to maintain controls, counter rising cyber threats and avoid disruptions to their new work environments.
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