00:00I think it's quite hard really to separate tariff risk from geopolitical risk these days,
00:05but talk us through the key findings then from the report.
00:08Yeah, certainly. It really is.
00:10And we've seen that that particular risk on any risk survey has come to the top,
00:15and it is top of everybody's mind.
00:18No, I don't think you can separate tariff risk because it impacts everything.
00:22Even if you're a CEO of a company that only operates in one geography or even one country,
00:27whatever else is going on globally is going to impact you.
00:31It's the area that leaders feel that they've got no control over and often very little influence over.
00:37And so what we are seeing is a need to develop global fluency much, much deeper than it has been in the past.
00:45Leaders really need to develop muscle around geopolitics.
00:48Right. What are the specific manifestations, I guess?
00:52How has that showed up in your practice?
00:54Yeah, so we, hiring, we see executives looking for very specific roles, global or corporate affairs,
01:02really finding ways to get experts to help them tune out the noise.
01:07There's so much daily noise and news, and that's the world you live in.
01:11They have to look to the longer term and keep a steady hand.
01:15Next week's going to be a huge week, but they still have to keep a steady hand,
01:18whatever the tariff news comes out with,
01:20knowing that in weeks or months it will probably change again.
01:24What does CapEx look like?
01:26I mean, if you sort of just peel it back a little bit and look at what the Trump administration is,
01:30or what they're partially trying to achieve here is reshoring or on-shoring a lot of these technologies,
01:35do you actually see those commitments starting to come through,
01:38or CEOs and other executives just still waiting to see what actually comes out in the end?
01:43CapEx isn't moving that fast.
01:48Certainly, I think that's everything that we're seeing and many executives are seeing.
01:53Even before the Trump tariffs, however, we were seeing a lot of trade shifts move.
01:59Historically, of course, Asian economies have been very export-oriented.
02:03That's been the success.
02:04That world has really shifted.
02:06China has diversified incredibly.
02:08We see the Middle East and the GCC countries really looking to move to Asia and look east rather than just to America.
02:17And so from a global GDP perspective, that's really encouraging, that level of diversification.
02:23What does it mean for CEO turnover?
02:25I just want to get a sense of that and why it affects that.
02:29Yeah, so CEO turnover has been a record high in the U.S. and EMEA this year.
02:35However, it has actually dropped in Asia.
02:38And so one of the conversations I've been having this week is, why isn't it happening or isn't it happening yet?
02:44And our team are having a lot of succession conversations.
02:47They're having a lot of leadership development conversations.
02:50And the view is that that is coming.
02:52For family offices, some of the older founders are now really handing over
02:59because it's a different world and a different economic set than they grew up with.
03:03And we do expect to see a lot more turnover in CEOs coming for Asia.
03:07What does it mean for pipeline, too?
03:09Like, what is pipeline looking like?
03:10Is there enough pipeline in the Asia-Pacific?
03:12It's something I don't think we're very much used to just yet.
03:17Not yet.
03:17Not yet.
03:18There's definitely been a historic reliance on Western talent for executives coming.
03:24That is improving, I would say.
03:27And it is no longer the default.
03:29So, for example, looking for executives in Japan, they will look to Hong Kong, they will look to Singapore, they will look to India.
03:36So it's not just the default any longer.
03:39It's growing.
03:39It's getting better.
03:41What does the overall sort of, what are the compensation trends that you see as well?
03:45And you mentioned that sort of that battle for talent.
03:47How is that actually playing out?
03:50Yeah.
03:51Talent always gets paid at the top level.
03:53The very best performers always get paid very, very well.
03:56Beneath that, we're seeing a lot of flattening.
03:59A lot of flattening, a lot of freezes.
04:02Bonuses are not necessarily key coming up with cost of living.
04:05And so that is a stretch for many countries.
04:09What about hiring in tech?
04:11Hiring in tech?
04:11I know that's very, very broad.
04:12Yeah, that's a big topic.
04:14It has really changed.
04:17You know, a few years ago we would talk about digital talent.
04:20We don't really talk about that anymore.
04:21It's too broad of a topic.
04:22It doesn't really mean anything anymore, actually.
04:24It's lots of different things.
04:26So we talk about AI engineering talent.
04:29That is the most sought after technology talent at the moment and demand far outstripped supply.
04:34And so actually other types of talent, for example, the classic CTO role or chief digital officer role, doesn't really exist anymore.
04:44We're seeing those roles get spread out into different areas, get pushed into retail, get pushed into different parts of the business.
04:53So it's really become more fragmented, actually, in terms of tech hiring.
04:58We still see India as really a powerhouse in terms of future tech talent.
05:03And particularly impressive is how they're investing in AI.
05:07It is interesting to see how countries, mostly kind of the BRIC countries, are investing in AI more heavily than, for example, the Europeans.
05:16So I think as we look forward, there's a real opportunity for BRIC countries, emerging economies to step up.
05:22I think as well, though, and I think about sort of some of the roles that these more emerging economies do.
05:28It's things like call centers, for instance, or support staff that is going to be really easily replaced by AI.
05:34What are you seeing on that front in terms of planned?
05:37I mean, essentially, it is planned headcount reductions.
05:40We've already seen them, for instance, from Salesforce or Microsoft.
05:42Who else is going to be following?
05:44Yes.
05:45Actually, we are continuing to see global centers grow in India and the Philippines.
05:52Which I'm a little surprised at.
05:54It's been there for a long time, but they're continuing to grow.
05:57And it's both a cost play and a productivity play.
06:01So, yes, some of those specific types of work can be replaced by AI.
06:06However, they get reoriented in something else.
06:11So workforces, in some cases, are being laid off.
06:14In some cases, they're just getting more and more productive.
06:17I also just came into my mind, of course, Middle East is a region that's investing so heavily in AI.
06:23And also, I think it's very interesting to watch the developments between Asia and the Middle East.
06:28But what is that relationship looking like?
06:31Yeah, it's getting stronger and stronger.
06:33I think, you know, the GTC countries have invested heavily into both kind of knowledge worker talent as well as broader workforce talent.
06:44They've got a very, very young workforce, actually, which I think will be as transformative as AI.
06:48They've got millennials and Gen Z will be the majority in a year or so.
06:53And this is going to be a very different workplace, particularly for the Middle East.
06:57So it's going to be really interesting to see.
07:00And, of course, they've got great ambitions to diversify and be part of the global economy.
07:05And, you know, so the other noise in the Middle East is very distracting and certainly unwelcome.
07:11We were just anecdotally having this conversation with a couple of people this week.
07:16And it seems like the younger generation don't have to worry about leveling up an AI because it's really part of what they do and what they study.
07:23It's really the middle manager to the upper management that sort of have to catch up.
07:27And I wonder, from your perspective, what are the baseline sort of AI proficiency skills that employers or you think executives should be forcing themselves to learn and just get their heads around?
07:41Yeah, I'm of the generation that only kind of opened a computer when I was finishing my degree when I was sending a resume off.
07:47And so we definitely have a completely different muscle when it comes to this than the Gen Zs and Gen Alphas coming through.
07:54The key trait that we find whenever we look for recruiting and executives is curiosity and whether it is for ability to adopt new tech, ability to go into new markets.
08:10If people have curiosity, they will learn and it doesn't matter how old they are.
08:14And so when we've studied this across multiple generations, it doesn't matter actually how old you are.
08:22You can be in your 50s or 60s or 70s.
08:24And if you have curiosity and learning agility and interest in learning, you will pick it up.
08:30So when it comes to understanding people and moving your workforce, it's the traits as much as the technical training.
08:38You're looking for people who are curious and interested to learn.
08:41Put the training in front of them and they'll go for it.
08:43OK, final question for you, I guess, risking oversimplifying, using you guys as a proxy for the global economy.
08:49Do you get a sense that hiring is going to pick up generally or is it the opposite?
08:54I do think hiring is going to pick up in select countries, not universally.
08:58I think the U.S. is going to be uncertain for a while.
09:02I think we're seeing countries like Malaysia really, really pick up.
09:05We're seeing India pick up.
09:07We're seeing Japan pick up.
09:08Australia actually is also looking good with a lot of investment in real estate.
09:12So it's very different depending on what your economy is looking at.
Be the first to comment