6 Ways CFOs Can Help Their Organization Become More Agile in 2021 & Beyond

2020 threw a drop-off-the-table curveball at everyone, starting with the alarming withdrawal of the UK from the European Union, economic uncertainty, negative oil prices, political anxiety, and the suffocating impact of the pandemic. It’s been nothing short of a whirlwind. Despite the events of 2020, Bridgepoint咨询公司正在展望 过去的一切，并采取措施  继续 帮助我们的客户取得成功.

As a result of last year’s circumstances, we’ve seen companies become incredibly reactive. While this is sometimes necessary, we’d like to discuss the shift of that mentality to a more proactive approach. Historically we’ve seen companies operating from a long-term, strategic, outlook allowing for stable growth; however, this WAS normal in a world where normal is no more. Today, we’re going to take the CFO position and what he or she should be thinking about moving forward. How should CFOs assess the events of 2020 and make sense of them? What should CFOs be focusing on for 2021?

这场危机显然迫使企业重新评估自己的经营方式，并适应这种新规范. We’ve seen some do so more graciously than others, embracing an agile mindset and coming out with their heads above water. In this article, 我们将在 上展开cfo应该关注的关键领域，以及他们如何领导自己的团队 成为更加敏捷的组织.

The 6 key areas for CFOs to assess for 2021 and beyond are:

1. Managing Your Workforce
2. Evaluating Supply Chain and Working Capital Management
3. Real Estate and CAPEX Management
4. Technology
5. Capital Structure
6. Competitive Landscape

Managing Your Workforce

It goes without saying that most businesses have already pivoted to a remote workforce model. While some companies have been fortunate enough to take on a work-from-home approach, others have had to furlough or permanently let go of employees and entire departments. As CFOs progress through 2021, re-evaluating which employees and departments return will be an essential factor to consider. If functions are critical, should you hire back, or can these departments be better serviced by an outsourced provider? While hiring an outsourced provider may command a premium, 它有可能使您的组织专注于其核心竞争力，并变得更加敏捷. More to come on this later when we assess Real Estate and CAPEX management.

Work-from-home policies have had a drastic impact on the way we view modern workforce management. The pandemic has been eye-opening in seeing how teams perform in this environment, with some executing better than others. As you continue forward, 评估组织管理和调动员工推动结果的能力是一个重要的考虑因素. Historically, organizations have found comfort in “seeing” employees in an office, but that could be deceptive. Instead of finding comfort in seeing employees in the office, we recommend emphasizing your team’s weekly results. If you can begin implementing a performance-based culture, this becomes the norm, and employees learn that this is the expectation. As you look forward to 2021, be sure to train or build flexibility into an adaptive workforce that understands expectations. With expectations in place, 您可以与一个准备在不稳定的环境中工作的令人难以置信的多才多艺的团队一起完成您的 目标.

Evaluating Supply Chain and Working Capital Management

Bridgepoint Consulting’s Managing Principal, Michael Johnson, participated in a recent Gartner Report that surveyed nearly 1900 CIOs across 74 countries. The findings? “51% of CIOs reported a decline in the speed of supply, and 18% reported a decline in supplier reliability as a result of the COVID-19 pandemic.” This data is consistent across a variety of industries due to the shifts in supply and demand.

What can we gather from this? Simply put, the pandemic has forced CFOs to re-evaluate their supply chain strategies. Before COVID, companies worked hard to service the customer. Companies knew who their suppliers were and knew who was dependable, enabling them to satisfy customers. They knew who they could depend on and were comfortable with their customer set. In a way, 他们在平衡状态下运作，这使他们能够准确地预测产品的供需, but COVID has completely disrupted this. The pandemic has produced massive waves of supply chain disorder. 许多公司的产品和服务面临严重的投入短缺，同时还要应付对其产品需求的急剧波动. 供应链参与者的不确定性进一步加剧了这种不平衡, including customers and suppliers, will survive.

In this uncertain supply chain, CFOs need to take steps to optimize their working capital, which consists of cash, inventory, AR, and AP. Never has the statement “cash is king” been more relevant. 财务主管需要确保每一分钱不仅能保证公司的生存，还能保证主要供应商和客户的生存. On the supply side, 首席财务官实际上可能希望加快对关键供应商的付款，以确保其持续生存，同时与不太重要的供应商谈判延长付款期限. They may even hold off payments to questionable suppliers until the dust settles. Likewise, on the customer side, CFOs will want to be selective on how they manage AR. 他们可能想要考虑为那些他们预计将度过危机的关键客户提供更优惠的条款，同时可能缩短对更多可疑客户的付款期限，甚至对其他客户转向现金基础. In short, by being strategic about managing working capital, companies can not only ensure their own survival, but they can also help ensure the survival of their key customers and suppliers.

If you’re an organization struggling to manage your inventory effectively, we highly encourage you to connect with us to learn how just-in-time manufacturing practices, risk-based analysis, and other methods can help introduce greater agility into your supply chain processes. Contact David Bizzaro here or Tommy Hannan here.

Real Estate and CAPEX Management

Real estate continues to be a major expense item for most organizations. Yet, the pandemic has presented both unique challenges and interesting opportunities for many, if not all, organizations today. 在家工作政策 已经 迫使 首席财务官和领导层  重新评估 他们计划如何管理他们的劳动力和房地产 需求. In our continuing conversations with organizations, we find that when they’re ready for staff to return to the office, most companies are evaluating a reduced in-office workforce. Many are even considering a return of less than 50% working in the office. It’s an impressive metric, but there is a multitude of reasons for this.

Pre-pandemic, 人们认为公司必须在一个受控的环境中为员工提供一个工作空间. COVID has turned this old norm upside down, 迫使公司重新思考如何让员工在没有传统工作环境的情况下保持生产力. As daunting as a remote workforce may seem, 它为成功的公司提供了一个重新配置资本的机会，使其远离传统的房地产投资(例如房地产投资).g., rent, parking, maintenance, leasehold improvements, etc.)转向其他工具和技术，以在遥远的世界重建一个受控和协作的工作空间.

Food for thought

Successful CFOs aren’t only thinking about how COVID impacts the bottom line, but also how it affects the workforce. 这种重新设想的在家工作环境可以通过提高员工满意度而成为一种竞争优势. From an employee’s perspective, they can now spend less time and money on commuting, have flexible work hours, choose where they want to live and work, and feel an overall greater sense of empowerment in their jobs. 随着员工满意度和其他因素，比如潜在的外包影响着你对房地产的决策, there is plenty to evaluate.

Real estate has a very tangible impact on your organization; however, another area  we recommend CFOs assess is capital expenditures (CAPEX). Given the current market, it’s vital to evaluate and analyze your CAPEX on a more frequent basis rather than annually. While it is a balancing act, it’s essential to work in flexibility by shifting from an annual basis to a quarterly basis. With the current market conditions, a quarterly CAPEX budget will allow you and your organization to pivot as the market changes, thus propelling your organization to a much more agile culture.  Even if COVID has negatively impacted your top and bottom line, by more closely managing your CAPEX, you may be able to achieve your free cash flow targets.

As we move into 2021, we see both real estate and CAPEX as an area of opportunity for CFOs to assess and fine-tune. By introducing more flexibility into your real estate and CAPEX spend, you will be able to manage the peaks and troughs of evermore volatile business cycles.

Defining Technology Your Organization Needs

Prior to COVID, most organizations had a stable long-term IT road map in place. 他们已经确定了他们想要迁移的系统和工具，并明确关注资本支出, OPEX, and associated benefits to these initiatives. With government shutdowns, companies found themselves in survival mode. Initiatives were delayed or canceled in an attempt to preserve cash, other projects were accelerated out of necessity, and new ones were created to adapt to the new normal. 许多公司2020年的IT工作变成了临时修复，以便在远程环境中尽可能地将流程整合在一起.

For 2021, we see CFOs needing to focus on three IT areas:

1. Re-prioritize IT initiatives in the new business environment. Enough time has passed to allow the dust to settle. IT isn’t going away and is worth the investment in the long run.
2. 评估一些用于远程操作的临时技术，并确定保留哪些技术, of those, which need to be made more secure or enhanced.
3. Build a new architecture to allow the organization to grow and scale in the new environment.

Before COVID, IT was a very siloed cost center delivering systems to support the business. Now more than ever, 作为包含劳动力的战略的一部分，信息技术需要处于前沿和中心位置, supply chain, and working capital, enabling it to become a competitive advantage. As CFOs are freeing up capital from physical assets such as real estate, 他们需要将这些资源转移到在远程环境中增强其业务流程的技术上.

Capital Structure

The stresses of the pandemic have forced CFOs to re-evaluate their funding strategies. At the onset of this crisis, each organization had its unique capital structure; however, evaluating this structure and its potential should be ongoing. 在应对大流行挑战方面取得成功的公司是那些尽早、经常与贷款人沟通的公司. By communicating to their creditors that they had a well-thought-out liquidity strategy, companies could reassure lenders, putting them at ease.

There have been several different strategies companies have taken on in 2020, from PPP loans to those deferring payroll taxes for up to 2 years as a result of the CARES Act. Each situation is unique, but we’re optimistic, particularly for small businesses, as SBA loans are up 4% YoY, according to the Denver Business Journal. Moving forward, 对于执行团队来说，探索灵活的资本结构以在动荡的商业周期中保持敏捷性是很重要的.

Competitive Landscape Implications

Now, nearly a year into our pandemic reality, there has been a clear line drawn in the sand between winners and losers. With continued restrictions, certain industries will face an uphill battle entering 2021, but this also creates an opportunity for new and disruptive competitors to enter the landscape. As CFOs work to adapt to our previously mentioned areas of focus, it’s important to not forget about your competitive landscape. With so many changes, from a customer and business standpoint, how should CFOs take advantage of this, and where do they start? There are a few things to consider:

Acquiring Market Share

• As some competitors fall by the wayside, companies should evaluate if there is an opportunity to acquire market share that was left behind. In theory, the answer to this should be yes; there is room to gain market share. 确定这个机会是什么，以及你的公司如何在这个领域取得进步.

Acquisition Strategy

• If there are competitors that have been considerably weakened by the crisis, should CFOs consider an acquisition strategy to absorb key businesses? If this is the case, 我们建议咨询并购顾问，以帮助权衡这种方法的利弊. While it may seem appealing to quickly absorb the competition at great prices, there are many complexities and preparations to review before committing to this strategy.

Exit or Sell Assessment

• On the flip side of the conversation, 有些公司在疫情期间取得了相当大的成功，它们可能会考虑成为收购目标. In recent discussions with private equity firms, 我们了解到，健康的公司能够获得比危机前更高的市盈率. If it makes sense, it may be time to assess an exit strategy and take advantage of higher selling prices.

Assessing your competition and your existing position should be an ongoing effort, but with so much change so quickly, we recommend taking additional measures to stay informed. Now that we have entered 2021, we recommend CFOs build more relationships with private equity firms and investment banks. Private equity firms and investment banks often have more profound insights into your market. 这些关系将帮助你掌握市场信息，并利用可能出现的机会.

Summary

Almost everyone entered 2020 following a course they had chartered in late 2019, completely unaware of the looming storm. When the immensity of the pandemic hit early last year, everyone was forced to batten down the hatches and enter survival mode. By the summer, it became apparent which ships had weathered the storm, which were bailing water, and which were resting at the bottom of the COVID sea. Regardless of their current state, almost all were diverted and were forced to assess their seaworthiness and charter a new course. Now that the storm has started to subside, 首席财务官应该花一些时间来评估其组织的六个关键领域，以使其更具可操作性. By introducing greater agility into Workforce, Real Estate/CapEx, Supply Chain/Working Capital, Technology, Capital Structure and Competitive Landscape Implications, companies will be better equipped to navigate the new virtual world in 2021 and beyond.