How CFOs Can Push Past Fear to Resilience and Resurgence
As COVID-19 took keep of the world economic system, most CFOs went straight into disaster administration manner. The focus was vigilant monitoring of cash balances and running multiple scenario strategies to assure sufficient liquidity in the shorter phrase. Now, a number of months into the pandemic and ensuing economic uncertainty, it is time to start shifting our concentration earlier fear and reactive cash-conservation tactics to resilience and, inevitably, to resurgence.
Right here are seven measures to help you and your firm make the changeover.
Maintain your gross margins.
- Although it can be tempting to minimize price ranges to obtain volume, protecting your gross margins will be critical for the extended-phrase potential customers of your company.
- Keep tight pricing controls and sacrifice volume for margin where by it makes perception. Company volume will return margins may perhaps not if you minimize them early.
- Use analytics to greater recognize margin/volume/products drivers. Are you seeing a dip in margin dollars and small business? How can you explain to the culprits? Using analytics to recognize drivers in margin because of to region mix, product mix, cost, and a subset of just about every of those people enables you to drill into the regions of the most concentration. You can’t deal with the issue if you can’t determine it.
Embrace zero-based spending plan alternatives.
- When was the previous time you actually did a zero-based spending plan in observe? As travel expenditures have now gone to zero, we have a distinctive chance to redefine how we technique company travel.
- Maximize acceptance ranges on company travel so C-level executives are determining what is deemed “essential travel.” Place month to month check-ins in spot with just about every section head to keep an eye on, explore, and determine what the upcoming of small business travel will glance like for just about every functionality.
Consider the recent small business landscape as an opportunity to modernize your technology stack, invest in strategic internet marketing strategies, train up your product sales workforce, or all 3.
Find ways to reinvest savings into superior-affect regions of the small business.
- Whilst it can be tempting to take all personal savings to the bottom line, check out to discover strategic investments that will help accelerate your rebound. Take the recent small business landscape as an opportunity to modernize your technology stack, invest in strategic internet marketing strategies, train up your product sales workforce, or all 3. The added benefits to the extended-term will far outweigh today’s bottom line.
Have interaction all customers of the firm.
- To find strategies to save money, strengthen processes, and otherwise maximize the rebound throughout a physically fractured time, Enlist the assistance of those people closest to your small business: your employees.
- Develop an internal “call to action” taskforce with cross-organization representatives to determine artistic new ways to maximize efficiencies across the firm.
Consider methods from disruption and morph them into best methods.
- Odds are, the weekly income forecast process you set into spot has turned out to be pretty helpful, has not it? Consider the best of the new processes you have inserted, optimize them, and then operationalize them.
- Go on your weekly collections, accounts receivable getting older, and income forecast review so you can spot developments before and respond forward of upcoming income troubles.
Assess your workplace footprint really don’t run straight to a pure cellular workforce if you can assistance it.
- As the initial move to a full perform from house team has started off to dress in, you may see productivity start out to dip. Generally, we will be a extra distant workforce than ever before, but there are measures you can take to really encourage collaboration and innovation although we all continue being distant staff.
- Work with your IT team to ensure the appropriate know-how resources are in spot and that you aren’t spending extra on software licensing than you actually use. All the “try our cost-free software” provides that flooded our inboxes when distant perform first released could arrive back again to haunt you at the time the “free” expires.
Advance your digital transformation plans.
- Whilst it may perhaps look counter-intuitive, the time to make development on your electronic transformation strategies is now. (See COVID-19 is Accelerating the Want for Digital Transformation.)
- For the sake of getting work completed, and completed very well, cloud technology can provide numerous extra alternatives than traditional, on-premises techniques that now number of men and women can accessibility. Communication is effortless and instantaneous. Work is extra secure and, if you’re paying interest to the data your cloud techniques can present, your selections are more rapidly and actuality-based.
We go on to run in unsure periods — no 1 appreciates how extended this world health and fitness disaster will go on or to what extent it will affect our economic system. But the time for unexpected emergency, knee-jerk reactions has passed. Strategic moves these kinds of as those people described previously mentioned will assistance present the raise a small business needs both now and in the upcoming.
Dayton Kellenberger is CFO for Vendavo, a provider of B2B pricing and commercial excellence solutions.