Customers before cost-cutting, say global CEOs.

As companies expand across the globe, finding new customers and markets, not just cost cutting, is now their primary goal, according to Pricewaterhouse-Coopers' 9th Annual Global CEO Survey.

Nearly two-thirds of the 1,410 CEOs surveyed and 66% of Canadian respondents are confident that globalization will have a positive impact on their business over the next three years. Canadian CEOs cite regulation, trade barriers and protectionism as the primary impediments to globalization (83%)--more than 20% above the global average. Other challenges cited by Canadian CEOs include overregulation (71%), political instability (52%), terrorism (50%), followed by social issues (43%), currency policies (40%) and loss of intellectual capital (40%).

"Cutting costs is no longer the sole purpose for globalization. In the new phase of global expansion, companies are focused on finding and serving new customers in growing markets around the world," said Robert Scott, leader of the PwC Canada IT advisory practice and co-author of a recent study on offshore outsourcing, A Fine Balance: The Buying and Selling of Canada. "The economies of Brazil, Russia, India, and, of course, China (BRIC countries) were once seen primarily as sources of low-cost production. However, they now present substantial growth opportunities for both multinational and locally-based companies, and at the same time are producing a new crop of serious global competitors."

Overall, 71% of all respondents say their company plans to do business in at least one of the BRIC countries over the next three years. Among Canadian CEOs, 56% view China as the most significant market opportunity, followed by India (48%), Brazil (45%) and Russia (26%). Canadian CEOs also see China (42%) and India (28%) as the greatest competitive threats to other markets. CEOs in the BRIC countries saw competitive advantage in the quality and productivity of their workforces as well as in their political and institutional stability and proximity to large consumer markets.

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