Ongoing geopolitical developments and the rapid advancement of technology are reshaping global business, and these trends are upending industry norms and introducing transformative changes that impact business leaders, operational models and workplaces, particularly in China, according to a recent survey.

Over 44% of Chinese executives express concerns that their companies are not adapting fast enough to keep pace with disruption – 12 percentage points above the global average, finds consulting firm AlixPartners’ Annual Disruption Index survey, which canvassed over 3,200 CEOs and other senior executives across 10 industries and 11 countries ( 20% of whom were based in China ) to uncover the disruptive forces that impact their businesses.

In China, which scored the highest in the disruptive index among all countries for the fifth consecutive year, inflation ( 38% ), interest rate hikes ( 36% ) and geopolitical conflicts ( 36% ), according to Chinese executives, are said to be the greatest threats to businesses in 2025.

Prioritizing digital investment, AI

The technology revolution is a double-edged sword; while leaders strive to exploit its full potential, they, the survey notes, also advocate exercising caution considering the inherent risks involved.

Notably, 60% of Chinese executives, according to the survey, are considering investing more resources in digital tools and technologies. Artificial intelligence ( AI ), the internet of things, and business or robotic process automation are said to be the top three areas for investment.

This is in line with global trends where 80% of business executives show positive sentiment towards the impact of AI on their business, 61% of whom are focusing on using AI to drive revenue growth and 39% focusing on cost reduction. And 72% of CEOs also envision their company implementing humanoid robots at scale within the next five years.

However, the advancement and deployment of technologies also present new risks and concerns for businesses. Notably, 46% of executives globally view data privacy and cybersecurity as the largest threats – 20 percentage points higher than the year prior.

Regarding using AI tools in the workplace, Chinese executives are worried about the lack of accuracy and reliability ( 35% ), lack of transparency ( 35% ), and legal and regulatory compliance ( 33% ).

“The huge potential of AI in driving revenue growth and cost reduction has put it front of mind for business leaders across the industrial spectrum,” says Shiv Shivaraman, AlixPartners’ Asia region leader at AlixPartners. “Businesses in China are doubling down on AI in the race for efficiency.

“It’s no coincidence that 45% of executives globally see operations and digital transformation to be the two largest areas of change – where AI is gaining wide application. That being said, over 80% of AI initiatives fail due to misaligned goals, poor execution and cultural barriers.

“To put capital to work efficiently in AI initiatives, a clear strategy and the right tools to metabolize the data flow and power growth across the business will be required.”

Adjusting to tariffs, geopolitics

Global geopolitical tensions are at the forefront of business leaders’ concerns, with China-US relations and rising tariffs at the heart of the discussion, the survey states, directly influencing companies’ supply chain and growth strategy. Notably, 45% of respondents globally expect supply chain issues to be worse 12 months from now, up 14 percentage points from last year.

In China, 36% of executives see geopolitical conflict as one of the greatest threats for their businesses. As a result, 61% of the executives are shifting their manufacturing and supplier footprints – 15 percentage points above the global average, while 76% of executives in China also think they will need to adjust their pricing strategy to be able to respond to supply/demand volatility.

This shows, the survey points out, a continuation of the changing supply-chain dynamics exacerbated by trade policy development in the US. About a quarter of executives globally have changed their mind since the US election and believe that the rising concerns over US-China relations will cause adjustments to manufacturing and supplier footprints ( +27% ) and changes to growth strategy ( +23% ).

On a positive note, the trend of Chinese companies accelerating their overseas expansion continues, the survey shares, with nearly 60% planning to significantly increase investments outside China in the next 12 months.

However, cost or complexity of new investments remains the top concern ( 27% ) among Chinese executives, with the rest being challenges related to supply chain, inflation, tariffs, talents and operating environment – all of which may hinder successful expansion.

Meanwhile, 65% of Chinese executives indicate that foreign ownership regulations are prompting them to change their business strategy or restricting their future plans.

Growth, profitability leaders

In the survey, 7% of the companies were identified as growth and profitability leaders, that is, those that are growing both their top and bottom lines faster than the rest of their industry.

Among this group of respondents, 87% are putting more money into digital tools and technologies in 2025 than the previous year ( compared with 58% of other respondents ), listing cybersecurity, AI and smart-connected devices as the three most important technologies for near-term investment.

A whopping 91% expect to make transformative or material acquisitions in the coming year, compared with 53% of all other respondents. And 65% expect to make significant business model changes in the next year, compared with 38% of the rest of the pack.

“Executives need to put contingency plans in place and adopt a risk-balanced solution in the face of an ever-changing macro environment,” adds Ignatius Tong, AlixPartners’ managing director and co-leader of Greater China. “Challenges remain persistent as seen with Caixin China General Manufacturing Purchasing Managers’ Index, which has hovered around 50 due to factory overcapacity, stagnant consumer sentiment and increasing challenges in global trade policies.

“That being said, companies in China are in a unique position to drive many of the disruptions worldwide while navigating some of the most difficult circumstances. As such, the quality and speed of responses to uncertainty, volatility and changes are what determine which companies will ultimately come out of the storm even stronger and well positioned for future growth.”