2009 Indiana CEO Survey

Robert Mackoy – Panel Member at the July 9 CEO Breakfast and Discussion
Associate Professor of Marketing, Butler University

There have been several common questions about the CEO Survey that have come from attendees of the panel discussion that I would like to address in this blog post.

1.  Was information learned about the impact the recession had on minority-owned firms and how much does this impact the overall economic stability of Indiana?

The CEO survey does not include questions about business ownership, so I am unable to answer this question specifically.  However, the survey does include a question about the ethnicity of the CEO respondent and I am able to examine results based on this variable.  Of course, there are ethnic minority CEOs of publically held companies and of non-minority-owned firms, and there may be non-minority CEOs of minority-owned firms, so the following does not directly address your question.

With the above caveat, it appears that there are only a few significant differences between the responses of minority and non-minority CEOs.  For example, minority CEOs on average rated the importance of “sustained and steady topline growth” and “corporate reputation” more highly than did non-minority CEOs.  They also were more likely to note they are planning to “add jobs” within the next 18 months.  On the other hand, they were less likely to rate the overall business environment of Indiana as an advantage relative to the business environments of neighboring states.

Specifically with regard to the current economic situation, minority CEOs were slightly more likely to agree that “major public works infrastructure projects will help to shorten the economic crisis.”  They were also slightly more likely to report dipping into cash reserves to help deal with the current economic situation.  Other than these two items, there are no differences in the mean responses of minority and non-minority CEOs.

This year’s survey also included an open-ended question which asked what, if any, specific activities “your organization is taking in response to current economic conditions.”  Because the question was completely open-ended, responses to it probably best capture how individual firms react to the recession.  On this question, there were no differences between how minority and non-minority CEOs responded.  Both were equally likely to use cost-cutting and revenue-generating measures and both were equally likely to use any specific measure.

Thus, in summary, it appears that there are many more similarities than differences in CEO perceptions of -- and reactions to -- current economic conditions.

2.  The CEO survey has been administered in Indiana for three years in a row.  Have the same people responded to the survey each of the three years, or are there different people in the sample each year?

This is an important question because we have seen generally consistent responses (across the three years) to “big picture” issues such as CEO priorities, strategic plans, perceptions of Indiana’s economy, etc.  If we are simply hearing from the same individuals year after year, this consistency may be less surprising than if we are hearing from different individuals at different points in time.

The simple answer is that “we don’t know exactly.”  The survey respondents are always anonymous to us, so there is no way we can track respondents over time.  We guarantee anonymity so that respondents are more likely to be completely candid in their responses.

Our sample frame, that is the listing of individuals we invite to complete the survey, grows each year.  Many of the same individuals are invited to participate annually, so there is likely to be some overlap each year.  On the other hand, the total number of respondents has grown from 210 in 2007 to 225 in 2008 to 360 in 2009, so we know that we are capturing the thoughts and opinions of at least some new respondents each year.

Finally, one should note that the survey has an exceptional response rate of over 21 percent.  In addition, our respondents mirror the profile of all Indiana firms in terms of industry classification and firm size (both revenue and number of employees), though firms based in central Indiana are slightly over-represented.  Thus, we believe that the thoughts and opinions captured in the CEO survey are generally representative of the thoughts and opinions of Indiana CEOs as a whole.