As myriad pressures mount for business leaders across Africa and globally, a majority of CEOs are carrying a favourable outlook on the year, and in some cases, the decade, ahead.
Across sub-Saharan Africa, CEOs remain remarkably optimistic about the future, with 61% holding the outlook that their businesses will remain viable for more than 10 ten years – a significant 21% increase from last year.
This finding is part of PwC’s 28th Annual Global CEO Survey – Sub-Saharan Africa report, which takes a closer look at understanding the heightened optimism amid significant economic volatility.
Hannelie Gilmour, PwC South Africa consulting and transformation platform leader, says the seemingly contradictory stance can be interpreted as a fundamental shift in how regional business leaders are approaching their long-term strategy— – hey are doing so by embracing uncertainty as a catalyst for reinvention rather than a barrier to growth.
“This new way of thinking is spurred on by a concept we call Business Model Reinvention,” she says. “In essence, it is a process of fundamentally changing the way a company creates, delivers and captures value. This involves rethinking and redesigning core aspects of the business, such as its value proposition, revenue streams, customer segments and operational processes, to adapt to changing market conditions and emerging opportunities.”
In PwC’s newly launched Business Model Reinvention reports “From threats to disruption” and “From disruption to reinvention” following the 28th Annual Global CEO Survey: Sub-Saharan Africa Perspective, the company provides critical insights on the factors spurring on various reinvention imperatives – from CEOs embracing strategic diversification, which is proving to enhance profitability and create competitive advantages in the global market, to investments which are also on the rise in the region.
Emerging threats reshaping the business landscape
The convergence of key megatrends – climate change, technological disruption, demographic shifts, a fracturing world and social instability—has introduced significant external pressures on businesses.
For 42% of CEOs in the region, inflation remains a major concern, while 30% feel highly or extremely exposed to macroeconomic volatility. Inflation can erode consumer spending power, leading to a reduced demand for products and services, while in a broader business context, this means higher costs for raw materials, labour and other operational expenses, which impacts profit margins and market competitiveness.
Similarly, macroeconomic turbulence creates an unpredictable environment for businesses that can impact everything from consumer confidence to supply chain stability.
Gilmour says: “Macroeconomic volatility and inflation present significant challenges for businesses in Sub-Saharan Africa as the unpredictable nature of these economic factors can disrupt strategic planning and operational stability. Inflation drives up costs, squeezes profit margins and complicates pricing strategies.
“Macroeconomic volatility creates an uncertain environment that affects everything from consumer confidence to supply chain stability.
“To navigate these challenges, businesses must remain agile and resilient, continuously adapting their strategies to mitigate risks and seize opportunities. This requires a deep understanding of market dynamics and the ability to pivot quickly in response to changing conditions, ensuring long-term growth and stability.”
From disruption to reinvention
PwC data reveals that more than 67% of Southern Africa CEOs believe their businesses will be economically viable for more than 10 years. This is particularly significant in South Africa where the formation of the Government of National Unity (GNU) has boosted business sentiment to its highest level in nearly four years.
“The new administration’s focus on tackling key issues in infrastructure, energy security and logistics has played a significant role in restoring this confidence,” Gilmour says.
The convergence of these political transitions and policy reforms across Southern Africa territories has created a compelling environment for business growth, contributing to the broader positive sentiment about Sub-Saharan Africa’s economic trajectory.
While CEOs in the eastern (59%) and western (59%) regions of sub-Saharan Africa are slightly less optimistic than those in the southern region, all remain more optimistic than the global average (55%).
“This optimism is rooted in their strategic focus on transforming their businesses to explore future opportunities and address potential challenges,” Gilmour explains.
At the heart of this transition lies a complex interplay of factors that collectively determine a business’s long-term viability. Through our data, we assess how the region’s CEOs are strengthening several important pillars which inform the future viability of their organisation. They include:
- Profitability as a cornerstone to Business Model Reinvention – Improved profitability is a key factor in this optimism. During the most recent fiscal year, 24% of companies in Sub-Saharan Africa reported profitability slightly better than the industry average, while 17% reported significantly better profitability. This indicates effective cost management and revenue generation strategies, with companies focusing on optimising operations and enhancing financial performance to ensure sustainability.
- Market demand, and sector and international diversification – One of the most notable signs of Business Model Reinvention in Sub-Saharan Africa is that 50% of surveyed companies have expanded into new sectors over the past five years. Kesh Naidu, PwC Africa consulting and risk services clients and markets leader, says: “This bold approach to diversification has seen significant movement into high-potential sectors, with real estate (16%), asset and wealth management (15%) and business services (15%) leading the charge. The power and utilities sector and technology sector have also attracted substantial interest (13% and 12% respectively), reflecting a strategic pivot towards essential services with sustained demand.”
- Building competitive advantage through strategic investment – Companies are backing their reinvention actions with substantial capital commitments. The data shows a robust appetite for investment, with 27% of businesses in the region planning capital expenditure between $1-million and $5-million, in the coming year. More notably, 12% are preparing to invest between $25-million and $50-million, demonstrating serious commitment to building long-term competitive advantages.
- Innovation and scalability – Business leaders in Sub-Saharan Africa are strategically reinventing their businesses to remain sustainable as market trends continue to change. These innovations reflect a broader trend: 44% of businesses are developing new products and services, with 42% targeting new customer bases and 36% exploring alternative market routes. Gilmour says this shows that sub-Saharan Africa CEOs are bolder with their reinvention activities where they are exploring various aspects of reinvention at the same time.
From reinvention to success
Whether today’s business leaders and their people are ready or not, today’s organisations are entering a new era characterised by a whirlwind of technological disruption, climate change, social instability, demographic shifts and a fracturing world.
“The path of Business Model Reinvention in Sub-Saharan Africa is a testament to strategic thinking and adaptive capabilities,” Gilmour says. “What emerges is not a universal template, but a context-specific approach to organisational development that reflects the region’s distinctive market dynamics. In Sub-Saharan Africa, this transformation is characterised by deliberate, bold changes where CEOs should not be seen as abandoning their core operations but strategically expanding them.”
The challenges facing companies in the next decade will range from the substantial to the existential. However, by leaders embracing Business Model Reinvention and the opportunities it affords, it will increase the odds of success. For business leaders both on the continent and globally, this narrative provides a compelling perspective on how thoughtful, measured transformation can unlock new pathways to growth and resilience.