Mid-Market CFOs are Evolving to a New Potential in 2021

Blog post

The global pandemic forced all businesses, regardless of industry, to rapidly respond and adapt to unprecedented circumstances. From reevaluating business and financial strategies to transitioning employees to a new working environment, companies drastically changed the way they operated.

“Unprecedented was the buzzword in 2020 for good reason. Many middle-market companies persevered through levels of transformation and disruption in one year akin to what some companies experience in a full lifecycle. But rather than hunker down and endure, middle-market leaders endeavor to move forward to refresh strategy and enhance agility. While we’re not out of the woods, the middle market is poised to pivot to new levels of potential.” –Wayne Berson, CEO of BDO

In order to remain stable in an unstable landscape, middle-market businesses pivoted by seeking and implementing new opportunities and technologies. BDO’s 2021 Middle Market CFO Outlook Survey found that even in the midst of a pandemic, organizations shifted their perspectives and accelerated towards recovery. A majority of the survey respondents stated that they expect an economic recovery in 2021, with an increase in both profits and revenues.

CFOs’ Main Priorities for 2021

As mid-market companies quickly acclimated to an unexpected environment, they gained insight on which strategies were deemed necessary and which strategies had to be overhauled. C-Suite executives prioritized technology spending, reorganization, and real estate reevaluation.


With a majority of the mid-market workforce adapting to digital or contactless environments, a prioritization of technology and IT spending was key for business continuity and survival. Finance teams should continue to collaborate with IT and invest in cloud-based automation software to further implement financial automation and analytics initiatives. In the BDO Outlook Survey, 59% of respondents specified that they will increase IT spending in 2021, and 27% mentioned that both technology and infrastructure are top business priorities.

Middle Market CFOs Evolving to a New Potential in 2021 | Technology

In addition to transitioning to a digital workspace, mid-market companies also found that focusing on data-driven analytics and decision making is important in planning for the future. By implementing analytics, F&A teams can pull real-time data from high-level financial close metrics and better optimize the close process.


Many businesses are continuing to have to make hard decisions for the future of the organization. BDO noted that “restructuring or reorganization is a critical strategy for companies who cannot recover under current conditions.” In the Middle Market Survey, 37% will seek a reorganization strategy this year.

Middle Market CFOs Evolving to a New Potential in 2021 | Reorganization

As companies restructure their organization, they may notice that they need to increase efficiency and productivity within their existing employees to further benefit the business. Implementing forward-looking strategies, such as financial automation and data analytics not only pinpoints the current bottlenecks but can also highlight any changes that need to be made to reduce the number of FTEs needed to complete the close.

Real Estate Reevaluation

In an effort to ensure safety for employees, many mid-market companies have enforced remote work since the start of the pandemic in 2020. As a result, “32% will reevaluate their real estate footprint.” To effectively maximize productivity for all employees as they adjust to new working conditions, “companies need to align real estate strategy to enterprise goals.”

Pivoting for Growth

While there are definitely many challenges that lie ahead for businesses, BDO mentioned that “companies across the middle-market are anticipating more opportunities to evolve and serve changing customer needs.” Businesses are accelerating the implementation of long-term strategic initiatives, with “nearly half of CFOs saying one silver lining of the pandemic was faster decision making in their organization.”

Middle Market CFOs Evolving to a New Potential in 2021 | Pivoting for Growth

Despite the uncertain business environment, “many middle-market CFOs plan to proceed with deals to aid in growing their business and scaling.” As many as 24% are planning for mergers and acquisitions, while 20% of private organizations are pursuing an initial public offering (IPO).

As companies plan to scale their businesses, it’s crucial that they place a huge emphasis on control and business continuity, especially when navigating the close virtually. Implementing cloud-based automation and task management software not only enhances communication but also outlines tasks that need to be completed when onboarding new personnel.

Redefining Work Culture

The definition of the traditional work environment has changed drastically, but the push to virtual (or hybrid) work has prompted organizations to invest in their company culture. BDO states that as many as 42% are prioritizing diversity and inclusion as a workforce strategy.” Organizations are “ramping up efforts to build a more diverse workforce, including enhancing their recruiting, training, and leadership development programs.” Not only does this push for more diversity and equity and improve employee morale, but it also contributes to a corporate culture that promotes creativity and innovation within the organization.

Risks and Challenges

While the pandemic has presented many opportunities in the face of adversity, mid-market businesses are still concerned with the longevity of this prolonged downturn. A heightened focus on security, resilience, supply chain, and financial reporting still remain key challenges within mid-market companies.

Middle Market CFOs Evolving to a New Potential in 2021 | Risks and Challenges

Up to “17% of CFOs said managing disclosures and risk factors would be their top issue.” BDO also emphasizes that “complying with the reporting requirements from government assistance programs will also be a key challenge, with a majority of middle-market companies securing assistance and thus needing to ensure they have the proper documentation, recording and reporting to stand up to potential audit and avoid penalties or repayment, where possible.” To effectively mitigate risk and prepare for the future, “54% will increase spending in finance and accounting departments this year.”

As financial reporting becomes an even bigger issue, staying ahead of the compliance curve is crucial. Automating financial processes enables organizations to reduce risk and stay up to date with regulatory requirements. Centralizing data and analyzing it also allows organizations to obtain an accurate financial picture and plan for the future.

“The middle-market has been a model of flexibility, and when it comes to risk and reporting requirements, consistent diligence is the prized approach. Stakeholders will have increased scrutiny as the long-term impacts of the crisis continue to play out, and companies will need to rely on a transparent and accurate financial picture to help them realize their new potential and plan with more precision.” ­– Bill Eisig, National Managing Partner of Assurance

The pandemic has highlighted an abundance of challenges for mid-market companies, but it has also empowered many organizations to build resilience, adapt to unforeseen circumstances, and shape the future for the better. This year is seen as a period of recovery and revitalization; discover how 2021 will change the way finance and accounting teams complete their financial close processes.

2021 Finance Trends that Will Impact Your Close Process | Adra by Trintech

Written by: Alex Clem