Overcome the “current” to focus on “winning the future”
In the face of the untold devastation wrought by the pandemic, it is imperative for businesses to remain customer-centric and nurture a collaborative culture between teams to drive exceptional outcomes.
A crisis brings out the best in organisations and teams, strengthening existing leaders and developing new ones. The article dwells on challenges faced by organisations in the wake of the COVID-19 pandemic, how finance teams can proactively partner with business to drive actions in the short-term and build resilience to sustain performance.
What inspires us is the organisation’s vision, mission and customer centricity that provides a guiding framework to sustain business and emerge successful. Keeping the customer at the centre of everything we do, will help us to focus on our purpose.
“The only constant in life is change”. The onset of the COVID-19 pandemic brought this point home in no uncertain terms in our lives, professional and personal.
The impact on the economy, healthcare and infrastructure are significant across the world leading to a humanitarian and economic crisis. Over the past four to five months, governments and communities have done their best to delay the immediate surge of infection through complete/partial lockdowns enforcing social distancing. Relief packages were announced to tide over the immediate economic hardship.
The challenge remains the high degree of uncertainty about the evolution of the coronavirus pandemic. Though it may be at or near peak in some countries and regions, for some others it is still a wait-and-watch policy as the number of infections continue to multiply at a rapid rate, with testing still limited and infrastructure strained. It is likely to remain a threat until an effective treatment or vaccine is widely available.
Organisations should evaluate options and accelerate actions to protect their customers, suppliers, partners, employees and address stakeholders’ performance expectations.
Proactive measures that would help to tide over the current situation, but more importantly ensure the business remains relevant and poised for future success are: a) attention to cashflow and liquidity; b) business continuity and contingency planning; c) resource allocation/rationalisation; and d) spend management to drive productivity. Communication channels should be strengthened so that the entire ecosystem – internal and external -- is vested in the call for action.
Finance teams will be expected to play a key role in the transformation. The learning opportunity is a significant bonus for personal development.
Over the years, finance teams have focused on becoming business partners, spending more time on value-added and decision support activities. The business disruptions and our role in the transformation will help to assess the progress we have made as business partners. As near- and long-term action areas are drawn out, the key themes and action plan will be around the following:
- Cashflow management and balance sheet focus. Working capital optimisation driven by shortening the cash conversion cycle and expediting receivables, better payment terms from suppliers and managing inventory tightly can lead to the goal. Revisit all capital investment plans with business leaders to drive informed decisions on timing of investments.
- Periodic cashflow projections to help treasury to plan and tap alternate channels/negotiate short-term debt to reduce the pressure on cash.
- Scenario and contingency planning with business teams for all lines of business to assess and manage risk. These should cover alternate revenue sources, new products, rationalisation of discretionary expenses, and cost reduction in areas that are not likely to hamper the come-back plan and dampen the growth trajectory when the COVID situation is under control. Operating across market segments (in countries), multiple countries (in regions) present good opportunities by prudently choosing focus areas and prioritising resourcing based on returns.
- Enhancing decision making through real time information providing Key Performance Indicators (KPIs). KPIs that provide leading indicators should be preferred vs. lagging indicators. These play a key role in benchmarking too.
- Control environment and technology solution to ensure the work from home environment does not expose the organisation to fraud, broken controls, tax and audit risks. Taking stock of existing manual processes and changing these to electronic or digital approvals through automated workflow would provide a secure control environment.
- Structured and focused communication cadence, providing clarity, regular updates, setting realistic expectations. Since teams are generally working remotely ensuring alignment is critical.
Keeping the team motivated and engaged despite the virtual environment is quite important to achieve common goals and keep moving forward.
Relating this back home, the spirit of social responsibility, safety first – caring for the wellbeing of the employee and the customer/patient needs to be taken quite seriously. Organisations need to invest in bringing relevant new products to the market in the shortest possible time.
The organisation and particularly the “customer facing team” inspires and motivates all to reimagine what is possible and put our best foot forward in the face of current adversities.
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)