Adapting to Challenges in the Current Business Environment

As a business’s financial leader, the CFO is responsible for influencing operational decision-making and steering their companies to success, regardless of an ever-changing business environment. That responsibility is now more complex than ever due to the global business disruption caused by the COVID-19 pandemic.

CFOs today must navigate the multiple operational and financial challenges that affect: the workforce, operations, and supply chain; finance and liquidity; regulatory compliance; and strategy and brand management. They must also work to plan for and position their companies for fast recovery and build financial resources to take advantage of opportunities as they emerge.

What Challenges Do Organizations Face?

The global economic downturn and continuing uncertainty revolving around the pandemic have placed extraordinary pressure on business leaders. Challenges in the U.S. business environment include:

  • Initiating and managing new ways of working -- from reconfiguring worksites and establishing practical remote working scenarios to accelerating the use of automation and AI. 
  • Changing product and service offerings, as well as pricing strategies, to fast-track recovery and increase revenue. 
  • Finding ways to contain costs and reduce operating budgets. 
  • Enhancing financial resources to sustain the business and ensure capital is available to take advantage of opportunities as they emerge.

Economic Concerns

Even before 2020, CFOs faced elevated concerns regarding growth, cash flow predictability and regulatory changes. They struggled with how those changes affected their organization’s ability to do business. As many companies now look to recover after the pandemic, protecting cash flow and achieving growth are still top-of-mind for many CFOs.

Our report: Risky Business: The CFO Perspective on Trade Challenges details how CFOs plan to pivot their risk strategies due to COVID-19 and why. In the report, you can learn about the challenges facing managers in today’s business environment, including:

  • What short- and long-term initiatives are now the main focus of CFOs 
  • How CFOs plan to change their risk strategies 
  • What types of macroeconomic factors are causes for concern

Cash Flow and Payment Challenges 

A chief responsibility for CFOs is to make sure their companies’ cash flows are stable and robust enough to ensure business operations. Securing and controlling liquidity has become more challenging in the U.S. business environment in the face of the pandemic. According to the results from our second annual Risky Business survey, CFOs report that payment defaults are on the rise – 61% report that nonpayment increased over the same period last year. This is troubling data because accounts receivable are often used as a form of collateral financing. Also, payment defaults can indicate a supplier or client is more vulnerable to bankruptcy. Closely managing third-party risk assessment is becoming a more frequent responsibility of CFOs. 

In the Risky Business report, gain insight into the cash flow and payment challenges facing CFOs in the U.S. business environment, including: 

  • Top practices CFOs use to mitigate nonpayment
  • The percentage of CFOs who report unrealized revenue due to risk posture
  • An economist’s predictions about insolvencies 

Political Risks & Impacts 

Equally concerning for CFOs is the political climate heading into the American election. According to our Risky Business poll, economic policy, trade policy and immigration are key concerns for 60% of CFOs. CFOs are also concerned about administration tariffs and their implications on their supply chains. Tariffs can raise the cost of doing business within supply chains, with unavoidable impact on cash flow.

Learn How CFOs are Adapting to the Current Business Environment

How are CFOs changing their risk strategies to meet the challenges facing their businesses today? Our report: Risky Business: The CFO Perspective on Trade Challenges gives an inside look at our survey results that indicate how CFOs are using specific strategies to trade on safe, reliable, and open terms that enhance their cash flow and support their growth. Our e-book also provides insight into current tools for risk management that can help organizations expand sales and explore new markets.

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