A_vision_for_growth_EN_Final

A vision for growth
Business outlook survey
Romania 2013

A Vision for Growth 2013Page 2
What is “A vision for growth”?
“A vision for growth” explores perceptions of top executives from major companies operating in
Romania regarding the business outlook for 2013.
This Ernst & Young report is based on a survey of 105 C-suite level executives from companies in various
sectors, who provided a perspective on how the domestic business environment is perceived at the beginning
of 2013.
5 main
findings
1 25% of respondents foresee a significant growth (+10-30%) of their company’s turnover in 2013,
while 51% expect a growth rate of +5-10%.
37% of the respondents expect the profit growth rate of their company to range
between 5 to 10%, and 31% between 10 to 30%, although early forecasts present 2013
as difficult year.
Only 2% of respondents say the salary increase in their company is expected
to exceed 10%, while 55% expect it to range between 5 to 10%. However, 42% say the
salary increase will be 0%.
75% of respondents say their company’s strategy to increase sales consists of
introducing new products/services for existing clients, while only 33% say they will enter
new geographic markets for existing products/services.
Most companies are willing to innovate, but they want to do so utilizing internal resources
(63%). There is a tight call among new business opportunity, customer satisfaction, and
operational efficiency, when it comes to areas of innovation utilization.
2
3
4
5

A vision for growth
Business outlook survey
Romania 2013
Although 2013 appears to be a
challenging year in many respects,
many companies say they expect
to grow.
Bogdan Ion, Country
Managing Partner

Please indicate the main three elements
that you use to define success. (multiple answers)
Question 1
Usually, companies measure their success by a combination of financial results, market share
and brand awareness, but customer satisfaction appears to be very high in their criteria list.
Total Respondents: 99
(Skipped this question: 6)
38%
64%
77%
93%
Brand awareness
Market share
Customer satisfaction
Financial results
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

How much do you expect your turnover to grow in 2013?
(one answer)
Question 2
25% of respondents foresee a significant growth (+10-30%) of their company’s turnover in
2013, while 51% expect a growth rate of +5-10%.
0%
3%
4%
17%
51%
13%
12%
-20 to -30%
-10 to -20%
-5 to -10%
0%
+5 to 10%
+10 to 20%
+20 to 30%
0% 10% 20% 30% 40% 50% 60%

How much do you expect your profit to grow in 2013?
(one answer)
Question 3
37% of the respondents expect the profit growth rate of their company to range between
5 to 10%, and 31% between 10 to 30%, although early forecasts present 2013 as difficult year.
3%
0%
6%
23%
37%
22%
9%
-20 to -30%
-10 to -20%
-5 to -10%
0%
+5 to 10%
+10 to 20%
+20 to 30%
0% 5% 10% 15% 20% 25% 30% 35% 40%

As the chart shows, 56% of respondents expect no increase in the employees number in 2013,
but 21% foresee a slight increase of 5-10%, mainly due to expected increased activity.
How much do you expect your number of employees
to grow in 2013?(one answer)
Question 4
0%
4%
14%
56%
21%
2%
3%
-20 to -30%
-10 to -20%
-5 to -10%
0%
+5 to 10%
+10 to 20%
+20 to 30%
0% 10% 20% 30% 40% 50% 60%

Only 2% of respondents say the salary increase in their company is expected to exceed 10%, while
55% expect it to range between 5 to 10%. However, 42% say the salary increase will be 0%.
How much do you expect the salary level in your
company to grow in 2013? (one answer)
Question 5
0%
1%
0%
42%
55%
2%
0%
-20 to -30%
-10 to -20%
-5 to -10%
0%
+5 to 10%
+10 to 20%
+20 to 30%
0% 10% 20% 30% 40% 50% 60%

Confidence in industry growth is rather low, even though most respondents expect their own
revenues to grow (see page 5 and 10).
How confident do you feel regarding the growth
of your industry for the next 12 months?(one answer)
Question 6
16%
44%
35%
4%
Not at all confident
Slightly confident
Somewhat confident
Very confident
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

The difference between confidence in industry growth and company growth forecast is quite
remarkable, which could show that companies place an important trust in their strategy.
How confident do you feel regarding the growth
of your company for the next 12 months?(one answer)
Question 7
3%
31%
40%
25%
Not at all confident
Slightly confident
Somewhat confident
Very confident
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

Low cost does not seem to be the main strength of the respondents’ competition in the local
market, competitors’ brand becoming more important in 2013.
Please describe the main strength of your competitors
in the local market, Romania. (one answer)
Question 8
39%
31%
14% 14%
2%0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Strong brand
awareness (trust)
Low cost Partnerships Distribution channels R&D

Where would you position your sales strategy between
the two following dimensions: relational and transactional?
(one answer)
Question 9
Relational companies build long-lasting relations with their customers, while transactional ones focus
only on transactions. 68% of the respondents to our survey say their company has a 100% relational
sales strategy, aspect which should be considered when reading the next 2 slides.
68%
24%
6%
2%
100% Relational
50% Relational
50% Transactional
100% Transactional

To what extent do you expect your customers' demands
to change in the next 12 months? (one answer)
Question 10
While 2% of respondents expect their customers’ demand to change dramatically,
66% foresee only a slight change.
66%
32%
2%
Somewhat change
Stay the same
Change dramatically

What impact will the change in customers' demand have
on your company in the next 12 months? (one answer for each option)
Question 11
Even though the previous chart showed that companies do not expect substantial changes in customers’
demand, the highest impact (if any) could occur on innovation strategy, brand positioning, marketing and
operations.
Total number of responses: 576
18%
21%
33%
49%
36%
24%
64%
60%
47%
46%
54%
53%
19%
19%
20%
5%
10%
24%
0% 20% 40% 60% 80% 100% 120%
Operations
Marketing
Brand positioning
CSR (Corporate Social Responsibility)
Organizational structure
Innovation strategy
No impact
Moderate impact
High impact

Most companies are willing to innovate, but they expect to do so utilizing internal resources (63%).
How do you plan to use innovation in your company
in the next 12 months? (one answer)
Question 12
63%
20%
7%
7%
3%
We will rely on in-house innovation for our activity
We will rely on others' innovation for our activity
We will not use innovation
We will partner with research and educational organizations
Other
0% 10% 20% 30% 40% 50% 60% 70%

How does your company plan to use innovation
to support the overall growth strategy? (one answer)
Question 13
There is a tight call among new business opportunity, customer satisfaction, and operational
efficiency, when it comes to areas of innovation utilization.
33%
24%
20%
15%
5%
3%
0%
5%
10%
15%
20%
25%
30%
35%
Innovation will be
focused on new
business
opportunity
Innovation will
focus on satisfying
customers'
changing demands
Innovation will be
focused on
operational
efficiency
Innovation is our
main competitive
advantage
Innovation will not
affect our overall
growth
Other

The high dependency on labor force’s skills indicates that companies are fully aware of the
direct link between employees’ competency level and company’s performance.
How would you rate the dependency of your company's
success on the skills of the labor force? (one answer)
Question 14
1%
23%
60%
16%
Low dependency
Medium dependency
High dependency
Extremely high dependency

83%
12%
5%
Dependent on education level
and key skills
Dependent on employee
retention
Highly influenced by salary
costs
Which of the following factors best describe the impact
of your labor force on company's success? (one answer)
Question 15
No less than 83% of the respondents say that education and skill of labor force play the most
important role in their company’s success.

What do you consider to be the most important
attributes for the leadership of your organization?
(multiple answers)
Question 16
Industry expertise, good risk/caution balance and embodiment of the organization’s values and
culture (tone at the top) appear to be the most important attributes of the successful leader.
59%
54% 53%
44% 41% 38%
33% 31%
0%
10%
20%
30%
40%
50%
60%
70%
Industry
expertise
Strikes the right
balance between
risk taking and
caution
Articulates and
embodies the
value and culture
of the
organization
Engages
effectively with
multiple
stakeholders
Decisiveness Can lead in a
regional
business
environment
Can command
the respect of
colleagues and
reports
Has a strong
graps of
financials

Over 95% of companies agreed that legal, tax and regulatory environment plays
a moderate to high role in their growth.
To what extent does the legal, tax and regulatory
environment play a role in the growth of your company?
(one answer for each option)
Question 17
(Total number of responses: 289)
4%
5%
4%
46%
49%
49%
49%
45%
46%
0% 20% 40% 60% 80% 100% 120%
Tax
Legal
Regulatory
No role
Moderate role
Very important role

Which of the following best describes your company primary
strategy for financing its investments in the past year?
(one answer)
Question 18
When it comes to financing investments, in 2012 companies used mostly bank loans (47%),
followed by share capital increase (12%).
47%
18%
4%
31%
Our company used bank loans to finance its investments
Our company attracted share capital increase to finance its
investments
Our company used venture capital to finance its investments
Other (intercompany loans, own resources, reinvested profit)
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Which of the following best describes your company's
preferred strategy for financing its investments in
the following 12 months? (one answer)
Question 19
In 2013 as well, the main companies’ strategy for financing investments
appears to be through bank loans (46%).
45%
20%
8%
27%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Bank loans Share capital increase Venture capital Other (intercompany loans, own
resources, reinvested profit)

Which of the following best describe the reaction of your
company to the business environment in the past year?
(one answer)
Question 20
In 2012, businesses reacted to the pressures coming from the business environment by reducing
costs (30%) or increasing productivity (28%), substantially more than by talent acquisition (4%) or
M&As (1%).
30%
28%
16%
13%
5%
4%
2%
1%
Cost reduction
Productivity increase
New products
Restructure of the organization
Other
Talent acquisition
Reduce capital investment
Merger and acquisitions
0% 5% 10% 15% 20% 25% 30% 35%

Which of the following actions will your company take
to increase sales? (one answer)
Question 21
75% of respondents say their company’s strategy to increase sales consists of introducing new
products/services for existing clients, while only 33% say they will enter new geographic
markets for existing products/services.
75%
33%
31%
26%
20%
18%
8%
5%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Introducing new products and/or services for existing client
and to attract new clients
Enter new geographic markets for existing
products/services
Opening new distribution channels/reorganizing distribution
to use multiple channels
Increase investment in marketing and sales
Adapting existing product/service for new geographic
markets
Cutting prices
Increase prices
Merging with and/or acquiring competitors to increase
market share

In case of stagnation/decline in your current markets what will
be the step/s your company will pursue in the next 12 months?
(all that apply)
Question 22
Most companies (76%) say that they will continue to stay on the market if it declines. A high
percentage of companies (46%) though, are willing to transform the market through innovative
approaches in case such a decline occurs.
76%
46%
15%
7%
2%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Stay on the market until is stable again in order to secure
it and increase the trust level
Transform the market trought innovative approaches
Grow on the market through Mergers and Acquisitions
Seek external funding to secure our position on the market
Leave the market and seek new ones

Demographics
The results of this survey reflect the
responses received to our
questionnaire in the period between
21 Jan. and 5 Feb. 2013, from 105
top executives of major companies
operating in Romania.

Demographics
Romanian company (yes/no) Business type
No, 57%
Yes, 43%
67%
29%
4%
Bussiness to Bussiness
Bussiness to Consumers
Bussiness to Government
0% 20% 40% 60% 80%

Demographics
Industry sector Company revenue level
24%
12%
10%
9%
8%
7%
7%
4%
4%
2%
13%
Industry/Manufacturing
Pharmaceuticals/Healthcare
Power/Energy/Mining
Services
Retail & Wholesale trade
Construction/Real estate
Food & Beverages/Agriculture
Telecom/Media
Tourism
Chemicals
Other
0% 5% 10% 15% 20% 25% 30%
7%
14%
38%
12%
29%
Less than 1 M EUR
1-10 M EUR
10-50 M EUR
50-100 M EUR
100 M EUR +
0% 10% 20% 30% 40%

Demographics
Entity type Job title of respondent
67%
22%
10%
1%
Privately owned
Publicly listed
Private Equity Portofolio
Company
Government/State-owned
enterprise
0% 20% 40% 60% 80%
34%
32%
8%
7%
5%
4%
4%
3%
3%
CFO/Treasurer/Controller
CEO/President/Managing
director
Manager
Board member
SVP/VP/Director
Head of business unit
Head of department
Other C-level executive
Other
0% 10% 20% 30% 40%

Thank you!

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