No longer on autopilot: Lessons for CFOs from COVID-19 – McKinsey & Company – Feld Center | Questrom School of Business

Written by Ankur Agrawal, Chris Bradley and Robert Uhlaner

The CFO must ensure that the financial-management approaches and tools being used to guide their companies through the pandemic stick in the next normal.

We’re now months past the first reports of global infections and deaths from the novel coronavirus, and CFOs and finance teams have done the hard work of leading their organizations through the immediate crisis—for instance, helping to ensure the safety and protection of employees, suppliers, and other key stakeholders; collaborating across functions; assessing liquidity and conserving cash; and reaching out early and often to investors to reset performance expectations.

To borrow a flight analogy, they’ve steered the plane through an extended wave of turbulence—but there is every indication that many more dips and dives lie ahead. There is no apparent return to business or finance as usual. Market conditions are changing, and so must companies’ traditional day-to-day planning and budgeting activities—and quickly.

The CFO must regain control of and reimagine financial plans and processes that, many would argue, have been on autopilot in the lead-up to the COVID-19 crisis. A hands-on approach is needed not just to steady business operations in the near term but also to create conditions for the company’s value-creation efforts in the next normal—and to act on key scenarios and strategies generated by the plan-ahead team.