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CFO – Financial Planning & Decision Support

The coronavirus is causing businesses to reassess their business models. CFO’s need to quickly discern the appropriate steps for guiding their respective organizations through sudden downturns in economic activity.

Below is a progressive plan that outlines a few considerations:Image title

Within each area lies a fundamental challenge for all CFO’s…  What is the best approach to balance Cash Flow & Liquidity during sudden shifts in business activity?

It is quite possible the US Economy might experience waves or seasons of COVID-19 outbreak.  The Spanish Flu of 1918, as an example, came in 3 seperate waves; Spring 1918 - Fall 1918 - Spring 1919.  These waves may effect various regions differently.  You may want to consider to potential impacts to Sales Channels, where and from whom are your Procuring Raw Materials, where the production facilities, etc.  

In addition, federal, state and local governments have set a new precedent(s) on policy decision(s) during pandemics by instituting lockdown which can drastically impact your financials if your business is within the subject region.

Therefore, it is prudent to build an operating model and a financial plan that mitigates financial risk during pandemic seasons of unknown durations and severity.  

Thus, CFO’s should stress the Financial Models and Test Scenarios using a robust Financial Planning & Analysis process.  These practices should supply Management with useful insights & potential outcomes covering and range of alternatives.

The Leadership Team at Elite CFO has experience navigating companies through downturns and economic uncertainty using an array of Digital Tools and Financial Disciplines. 

We've found that Management Teams who are able to forecast the economics of key decisions and potential outcomes tend to have more confidence in the decision-making process. 

More confidence leads to better management and more effective use of company resources.

Stephen Perkins