In the beginning of the current Coronavirus (COVID-19) pandemic, offices of finance struggled not only to perform the tasks expected of them, but to provide insight that would drive business critical-decisions. As time goes on and companies begin to adapt to the “new normal”, CFOs will continue to be relied upon to not only ensure a company’s survival but position them for the future.
Recently, Jack McCullough, founder and president of the CFO Leadership Council sat down in an interview with CFO Dive to discuss the six ways that CFOs can best position their companies for relaunch and recovery in the coming months.
1. Continue Over-Communicating
“When constituents need the unvarnished truth, they turn to finance chiefs,” says McCullough. “Your employees, investors, customers and suppliers, on a daily basis, [should be] fully informed and excited by your vision for the future.”
In times of uncertainty, there’s no such thing as too much communication. As organizations continue to navigate the environment they currently find themselves in, guiding words from a C-level executive with intimate knowledge of the company’s position is worth its weight in gold. McCullough goes on to explain that COVID-19 creates two crises: a health crisis and a financial crisis. Of those two, CFOs are uniquely positioned in their organizations to solve the second issue.
2. Take Care of Your Team
As we all continue to adjust to the “new normal”, it’s easy to lose sight of the wellbeing of team members. However, during times like this treating your people well matters most.
Unfortunately, the one person who is often overlooked in these endeavors is the CEO. McCullough advises CFOs not to forget their partnership with the CEO. “As much pressure as you’re feeling, he or she is probably feeling more. Check in on the boss and let them know that you have their back.”
3. Develop a liquidity plan
The COVID-19 outbreak has brought to light the importance of cash liquidity. If your company struggles with its short-term cash flow, McCullough recommends identifying where your problem lies by asking exploratory questions. For example, what does your current access to capital look like? Are your bankers willing to be flexible in delaying loan payments? Questions like these can help your organization best position itself for the current environment.
4. Engage in Scenario Planning
Over the past few months, CFOs have been frequently under extreme pressure to make quick business-critical decisions that can guide the organization. To help with this, McCullough stresses the importance of creating a wide range of possible scenarios that the organization could face. From those scenarios, organizations can proactively create a financial plan that will ensure continued success.
5. Show Strength
Assuming that it’s fiscally feasible, times like this are great for making the changes and investments you’ve been hoping to. McCullough explains that while making additions to the office of finance, such as implementing automation or artificial intelligence, can feel like a gamble, “flexing your muscles when others are showing weakness can pay dividends.”
6. Rethink Your Business Model
Once the pandemic ends, every company is going to function differently than before. CFOs must work with leadership to figure out what that change is going to look like and determine what that will mean for the organization as a whole. McCullough uses the average neighborhood barber as an example asking “Are people really going to come in? Will it be the same experience?”
CFOs and overarching C-level executives need to identify what their customers are going to want moving forward and change the company to satisfy the new demands.
The Key to Following These Guidelines
The guidelines above are a great starting point for organizations to overcome and adapt to the impact that COVID-19 has had on their organization. However, in order to follow these guidelines, the office of finance needs access to real-time financial data. As it stands, financial processes are typically conducted through spreadsheet usage and other manual means. This approach is time consuming, leaving little if any time for analysis, and lacks any significant level of visibility. By implementing automation, not only can you achieve a faster process, but you gain the level of visibility necessary to provide the business-critical insights that your organization needs.
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If you would like to learn more about how financial automation can help meet the new demands that the office of finance is currently facing, check out our COVID-19 resource page.
Written by: Caleb Walter