With so many businesses facing the uncertainty of what may come in the future amidst COVID-19, CFOs are faced with a tremendous challenge to help their organizations respond effectively and be on the right path to recovery.
According to a PwC CFO Survey, 42% of CFOs are most worried about the financial impact of COVID-19, including on liquidity and capital resources. But amidst the fear many organizations have around the massive losses that they are experiencing because of the current crisis, greater effort should be focused by CFOs and other top-level executives on creating the right recovery plan to help move them forward.
In this article, we’ll look into the key steps CFOs can take to help their business better respond to the crisis.
Outline a Clear Structure For Their Organization’s Transformation
A study by McKinsey shows that most advisory boards spend more than two-thirds of their time on housekeeping tasks such as financial reporting, compliance, environment, health and safety issues, and other regulatory issues. But only 20 percent is spent on strategy.
Now that we’re faced with more volatile markets and constantly changing economies, CFOs need to stand their ground and play a defining role in the board to push them to explore new ways to create sustainable value to their organizations.
The board should take full responsibility for leading the organization’s strategy, and the CFO plays a central part in supporting these discussions and ensuring they are push through. The CFO can help the C-suite come together with the right data to back their ideas so they can come up with a comprehensive plan that they can endorse to the CEO.
The CFO can support board ideas and give it the structure it needs to define and measure success. Amidst the disruption faced by businesses because of COVID-19, this is more crucial in dealing with challenges early on before they can potentially bring major disruption to the business and impact revenue.
Prepare A Solid Recovery Plan for the Future
McKinsey notes that nearly one in five (19%) CFOs are worried about cybersecurity risks, more than three times the figure reported in April, highlighting a fear for not being able to plan ahead for the future.
Guided by data and figures from financial planning and analysis, CFOs should influence their organizations to think more long-term. This could mean reviewing the organization’s current strategy and identifying risks as well as opportunities early on. If there’s a way for organizations to become better prepared for the future, CFOs must advise boards to not only focus on the short-term but to have a more encompassing outlook on the future to come by keeping a close eye on both local and global markets and having a top-level understanding of how worldwide economies dramatically impact businesses and communities closer to home.
Today’s CFOs must not be afraid to raise early warning signs, even if it means going against the board. Independent-minded CFOs are better positioned to present clarity, foresight, and common sense to balance out optimistic ideas presented to the board that may not present an accurate picture of all sides. Rather than be afraid to go against the grain, CFOs must remember to bring balance and give everyone in the board a realistic picture of what is going well versus what is not working so that the CEO can make more informed business decisions.
Help Their Organizations Embrace Change
A great CFO is always looking for new ways to improve current processes and exploring how to help their organizations achieve greater value. The COVID-19 pandemic should teach CFOs to always be open to change, whether it be introducing new software, adopting more stringent cybersecurity measures, or embracing digital transformation fully to keep up with today’s demands.
With so many businesses in the losing end with the impact of COVID-19, today’s CFOs must always be on the lookout for new initiatives that can help the organization achieve quick wins in problematic areas or find new ways to save on costs.
More importantly, it is crucial for CFOs to note that how they handle the COVID-19 crisis, including the initiatives they’ve taken on to better adapt to the current environment can influence the future of the organization and should not be taken lightly.
CFOs who are looking for a comprehensive financial planning and analysis software that offers scenario-based planning, Performance Canvas Financials is better placed than others to give you everything your organization needs to respond proactively to the current crisis.
Get in touch with the Performance Canvas team today.