CFO Planning During the COVID-19 Pandemic: 5 Ideas for Strategic Success in a Time of Crisis
March 29, 2020
By Pritpal Kalsi
Cities across the world are silent. Streets, hotel rooms, airports and restaurants are empty. Most commercial activity, the essential routine of daily life, has been paused for an indeterminate amount of time. From the seat of the CFO, the view of the national, and global, economic climate is unprecedented.
These are times when chief financial officers are going to need to flex their leadership skills. All of us, but especially those steering their companies’ finances, have been living in a technology-driven world for so long we’ve been able to manage people and processes from remote locations.
It’s ironic that our current state of social distancing has sharply focused our need, as leaders, to re-emphasize the importance of human connection and collaboration. This is a time when emotional intelligence is key, and should be driving strategy at every level, including the CFO’s office.
Create a Response Team
Silos are getting bridged, and communication is more critical than ever. Most organizations probably don’t have a crisis response team, but there is most likely a need for one today. Leaders need to decide what it looks like, who needs to be on it, and how communication needs to be handled. In addition to determining new channels for information and communication, leaders need to consider the ‘who’ as much as the ‘what’ — and address the human, emotional impact of the situation companywide.
An organization’s greatest vulnerability during a crisis is uncertainty. Along with everyone else, I can’t tell what tomorrow or next week is going to resemble. But every organization has a purpose. No matter what that purpose is, make it central to your operations during this time. What we do will change daily, or even hourly, but why we do it shouldn’t change. Point to this purpose through all operations. There will be long days filled with strategic challenges, alternative strategies, cost increases and unbudgeted, unplanned changes. Even one aspect of the changes the CFO will manage daily through this crisis would, under normal circumstances, take months to manage. A company’s purpose is the anchor in this environment that will keep certainty intact throughout the changes.
Identify Top Drivers
The CFO must have a clear understanding of the company’s top 10 drivers. From an opportunity and a risk standpoint, these are the data points you’ll need to revisit multiple times during the day. While you’re managing from the ground, these drivers will help you clearly understand what’s happening, so you can then execute your processes and methodologies, even if these are changing much more frequently than they ever have. Separate, block and tackle these drivers.
Take It One Day at a Time …
To make data-driven decisions, the CFO must now switch to a daily model. The data may be constantly changing, but it’s data, nonetheless. If there are systems in place that allow the collection of timely information in a central repository, now is the time to do so. Organizations need systems with this level of visibility. This is the time for blocking and tackling on the ground, in real time.
… But Keep the Future in Your Peripheral Vision
The climate in which your organization operates will change dramatically by the time we reach the other side of this crisis. Realistically, the pandemic will change human behavior going forward for a very long time if not permanently. Consumer habits will change, and business leaders will have to innovate and transform their operations accordingly. In fact, events like this, while stressful, are probably already creating a fair amount of internal innovation in action and helping your organization to get stronger and healthier in the process.
When the immediate crisis has passed, pandemic response teams have real potential to analyze the information that was gathered during the crisis and look ahead to potential growth opportunities for the future. Even now, before society emerges from this chaos, CFOs and their teams should be looking at how to position their organizations to be poised for success when the environment changes.
Because, although it may not seem possible now, this too shall pass.
About Pritpal Kalsi
Pritpal Kalsi, the next Chief Executive Officer of SC&H Group, will succeed SC&H Group co-founder Ron Causey as CEO on January 1, 2021. He currently leads SC&H Group’s Business Performance Management (BPM) practice, where he has focused on innovation and building motivated and efficient teams that work together to meet and exceed project goals while providing the highest level of service. As CEO, Kalsi will continue to oversee the BPM practice, the firm’s largest service line.