CFO Strategic Partners recently conducted a brief survey to determine how local CEOs and business leaders are currently responding to COVID-19 and the related economic challenges. We are pleased to have received a significant number of responses and to now share this information.
Overall, 97% of respondents believe their organization will experience a reduction in performance in FYE 2020 when compared to their original budget or prior year, while 3% believe they may actually do better in 2020. Of those who believe they will experience less:
The majority of respondents have either made changes to wages, staff or hours, or are currently creating a plan to do so. With regards to employees, 30% have already reduced wages or decreased their workforce and 40% have not done so yet, but have started to evaluate their team for potential changes. Approximately 23% are waiting to see what the next 30 days brings and 7% do not plan to make any labor or wage reductions.
Remote Work & Business Culture:
While most respondents have made changes to allow their team to work from home “WFH”, our survey reveals that they are also looking forward to the time when their employees are able to return to the office. As of April 1, 2020, 15% have employees working primarily from their company’s office and 50% strongly dislike remote-based working arrangements, but are tolerating it right now given the current circumstances. On the other hand, 30% find that having employees work remotely has not been a significant disruption and 5% are actually enjoying it so much that they are rethinking whether or not a physical office is necessary.
Vital Accounting Functions:
Close to 62% of respondents reported that their accounting departments have been able to weather the current environment with minimal disruption thanks to investments previously made in technology and development of efficient processes. Another 31% are currently working on a plan to do so efficiently. Only 5% are unable to perform basic accounting tasks such as prepare invoices, write/sign checks, and obtain financial reports needed to make decisions.
Cash Flow Strategies:
At 85%, the majority of respondents have started implementing cash flow management strategies including:
Most respondents selected more than one of the above and only 15% are not considering any strategies for cash flow relief at this point.
While 4% of respondents are not worried at all, the majority (75%) are realistic about the current economic uncertainty but believe that with proper planning and execution, this economic situation will be weathered without significant long-term impact. Approximately 21% are extremely scared or concerned about the future.
The overall results of this survey show that although the majority of respondents believe they will experience a reduction in their bottom line results at the end of 2020, many have not yet implemented any changes but are in the process of creating a plan in the event it becomes necessary. Of significant importance, 3/4 of all respondents feel they are maintaining a realistic outlook about the uncertainty of the current situation, but remain positive about their ability to bounce back when things return to normal. It is also interesting to note that those who previously made investments in technology and establishing efficient processes are experiencing the least amount of disruption to their day-to-day accounting functions.
CFO Strategic Partners understands how the current circumstances have potentially shined a light on accounting deficiencies in your company. Whether you need short-term or long-term help, our 20 years of experience makes us a valuable resource for small and medium-sized companies that need to develop a dynamic financial strategy to assist in surviving the current economic crises and thriving in the future. Visit us at http://www.cfosp.com, email us at firstname.lastname@example.org, or call us at 407-426-8288 to learn more.
NOTE: Given the current evolving economic climate, CFOSP is publishing more frequent communications on this topic based on what our clients are experiencing and our firm’s expertise. Stay tuned for updates or click here for more content on this topic.Tags: business culture, Cash Flow, cash flow strategies, cfo strategic partners, cfosp, coronavirus, covid-19, economic uncertainy, remote work, vital accounting functions, working from home