After Lockdown – CFOs Leading Companies out of the Crisis

Organisations are now starting to emerge from the crisis management situation that has become the norm in recent months.

They are now starting to look at what it means to navigate the crisis that has been created by the global pandemic, with the intention of coming out the other side in as good a position as possible.

Government support will soon be coming to an end and companies will need to address what their survival and growth strategies are. Top CFOs are already thinking creatively about how to tackle the challenge.

The role of the CFO

The role of CFO is pivotal in helping the business navigate through the current crisis and plan the way forward. Right now, top CFOs are focussing on three specific areas: stabilising the organisation, preparing for the new normal, and building resilience to emerge from the crisis.

They need to do this having regard to the seriousness of the global economic shock that COVID-19 has precipitated. It’s likely that there will be a global GDP contraction of 5.2 per cent in 2020. In this climate, there is no doubt that the challenges will be considerable.

Stabilising the organisation

Right now, top CFOs will ensure stability in the organisation by:

• Managing stakeholders.
• Protecting cash reserves.
• Developing scenarios and planning for them.

Preparing for the new normal  

Now that the lockdown has been relaxed, and businesses are re-opening, the best CFOs will be looking forward to how the business will operate in the “new normal”. This may include:

• Increasing productivity levels.
• Considering M&A moves.
• Looking at what capital requirements are must-have and which are expendable.
• Concentrating on accelerated FP&A to enable critical boardroom decisions to be made.

Building resilience to emerge from the crisis

Of course, it’s not just about planning for the new normal. Top CFOs are now ensuring that businesses are resilient enough to emerge from the crisis in a condition to survive and recover.

This is going to mean different things in different situations as not all organisations have been affected in the same way. Each CFO has his or her own individual challenges ahead of them. However, there are certain areas where efforts are likely to be the focus.

• Planning ahead. Companies need to have a two-day, two-month, two-quarter, and two-year view, so that they understand where they are in any potential scenario.
• Considering M&A actions. It’s difficult to say what the situation around M&A activity will be, in the wake of the COVID-19 crisis. However, experts have predicted some outcomes similar to those of the last financial crisis. At that time, companies that were highly active in terms of M&A often out-performed others.
• Expanding digital abilities. There is no doubt that the COVID-19 crisis has shown just how important digitisation is. This is certainly an area that top CFOs, and the boardroom, will be concentrating on.

It’s clear that CFOs will be hugely important to how well companies emerge from the global pandemic and financial crisis.

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