Businesses may be growing tired of hearing about uncertainty in recent months (if not years), but some of them, at least, have been adapting to a world in which instability is becoming an increasingly stable feature. This is the impression created by two recent C-suite surveys, which reveal an interesting divergence between the attitudes of large enterprises, on the one hand, and mid-market companies, on the other.
The first study, published in April by Deloitte, indicates that confidence among the CFOs of FTSE 100 and FTSE 250 corporations fell from an already low -13% in Q4 2025 to an even lower -57% in Q1 2026. By contrast, a Forvis Mazars survey of executives at mid-market UK companies found that confidence is at a less pessimistic 40%, while 91% are optimistic about their organisations’ prospects for growth over the coming year. This is despite instability provoked by the war in Iran, including its inflationary impacts on energy prices and financing.
While larger British enterprises have, according to Deloitte, reacted to this by seeking to reduce costs and boost cash holdings, mid-market firms have taken a more positive approach, with 67% of UK executives telling Forvis Mazars that their organisations are boosting investment across multiple areas. This indicates that, rather than pursue simple cost-cutting, many mid-sized companies are adopting an enterprise cost optimisation model, investing in new capital and new tech in order to drive productivity growth.
Mid-market companies report positive ROI for AI
Forvis Mazar’s previous quarterly report found that 60% of British companies have been investing specifically in AI in recent months. This may help account for their greater optimism, which so far appears to be paying dividends, given that the latest update finds that 90% of companies internationally are reporting positive returns on their AI investments.
In fact, 39% of mid-market enterprises are reporting a gain of between 6% and 10%, 14% report gains between 11% and 20%, and 5% are saying that their ROI on AI is 20% or higher. Meanwhile, 59% of these businesses confirm that their positive returns on AI come in the form of productivity gains, with other contributors including boosting customer satisfaction and also employee satisfaction. If accurate, these figures underline why an exclusive focus on cost-cutting may not always be the best option for preserving margins during periods of macroeconomic stress and uncertainty.
SMEs maintain investment plans despite uncertainty
Of course, the temptation during crises may be simply to batten down the hatches and focus on damage limitation. For example, in Deloitte UK’s April report, its then-chief economist Ian Stewart said that the war in the Middle East had dragged British CFO confidence down to levels not experienced since the Covid-19 pandemic.
Accordingly, the two concerns most-cited by CFOs were energy costs (61%) and inflation (61%), something which may partly explain why so many big-name companies have been pruning their staff numbers in recent months. Yet research published by workforce platform Orgvue in November 2025 suggests that rationalising headcounts can be a false economy, and not only because FTSE 100 companies paid £5bn in severance payments in 2024.
Indeed, Orgvue’s research found that the FTSE 100 firms that boosted employee numbers in the same year enjoyed two times the revenue growth of companies “doing more with less.” And almost needless to say, doing more with less can be difficult when sticky wage growth and energy inflation make the ‘less’ part of the equation a challenge in its own right.
Despite the current preference for cutting costs, Ian Stewart’s recently appointed successor as chief economist, Debapratim De, tells Raconteur that capital expenditure can and often does co-exist as a resilience strategy with cash conservation. He says, “investing in resilience programmes, such as in cybersecurity or supply-chain optimisation, can help firms navigate future risks better.”
De explains that mid-market businesses generally tend to prioritise cash holdings during difficult periods, since they’re more exposed to credit risk than larger enterprises. However, such sensitivity doesn’t necessarily result in a halt to all investment. He explains, “The British Chambers of Commerce quarterly economic survey shows that around a fifth of UK SMEs have expanded investment over the last twelve months — a period marked by elevated uncertainty — and more than 50% have maintained their investment plans.”
Investment in capital boosts resilience
For some commentators, companies are maintaining investment plans not simply because such plans are a desirable addition to day-to-day operations, but because they can be essential to survival and adaptation during difficult periods.
“Mid-market resilience today isn’t built by simply holding cash, it’s built by how deliberately firms reshape their operating models and deploy capital for innovation,” says Asam Malik, Executive Board Member and Technology Partner of Forvis Mazars in the UK. “What we’re seeing is a clear shift away from treating investment as optional, and towards using it as a tool to build adaptability into the business.”
Again, the benefits of investment and adaptation are reflected in the available data. Most notably, international PwC studies have revealed that firms integrating AI into their products and customer experiences have been posting profit margins that are almost four percentage points higher than firms that have been standing still. Such effects are something recognised by Malik, who tells Raconteur, “The leaders who are building real resilience are those balancing ambition with flexibility, and speed with control — particularly as AI becomes both a source of productivity and a business disruptor which can transform returns and growth.”
Adopt to adapt
So while the natural temptation during the current period of geopolitical and macroeconomic turbulence may be to enter full-on defensive mode, the evidence indicates that, where possible, companies should seriously consider updating their infrastructure. This becomes all the more imperative in view of how numerous other companies are already doing just that, creating a situation where laggards risk being left behind.
As Malik concludes, “Organisations should be investing now to prepare for what’s next, but in the right ways, to optimise the opportunities that come from AI and other emerging technologies, but cash conservation will inevitably be needed if adoption is not considered or implemented appropriately — leaving you open to risks that come with investing in large-scale transformation.”
Businesses may be growing tired of hearing about uncertainty in recent months (if not years), but some of them, at least, have been adapting to a world in which instability is becoming an increasingly stable feature. This is the impression created by two recent C-suite surveys, which reveal an interesting divergence between the attitudes of large enterprises, on the one hand, and mid-market companies, on the other.
The first study, published in April by Deloitte, indicates that confidence among the CFOs of FTSE 100 and FTSE 250 corporations fell from an already low -13% in Q4 2025 to an even lower -57% in Q1 2026. By contrast, a Forvis Mazars survey of executives at mid-market UK companies found that confidence is at a less pessimistic 40%, while 91% are optimistic about their organisations’ prospects for growth over the coming year. This is despite instability provoked by the war in Iran, including its inflationary impacts on energy prices and financing.
While larger British enterprises have, according to Deloitte, reacted to this by seeking to reduce costs and boost cash holdings, mid-market firms have taken a more positive approach, with 67% of UK executives telling Forvis Mazars that their organisations are boosting investment across multiple areas. This indicates that, rather than pursue simple cost-cutting, many mid-sized companies are adopting an enterprise cost optimisation model, investing in new capital and new tech in order to drive productivity growth.
