COVID-19 Guidance from CFOs Who Did It Right

  • 10/12/2020
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Many small to mid-sized companies have struggled during the pandemic. However, some successful CFOs have made smart moves to support stability and growth.

Key insights

  • CFOs who maintained adequate cash reserves or had access to cash wisely positioned their companies to deal with the immediate shortage.
  • Successful leaders found ways to increase revenue and decrease operating costs.
  • Once their company was stabilized, these CFOs began strategic planning with key stakeholders.

As COVID-19 spread in the United States, many small to mid-market companies were able to weather the storm — or even grow — during the crisis. Successful companies focused on liquidity, then stabilization, and finally positioning to adjust to the new normal. The chief financial officers (CFOs) of these companies played a key role in their success and proved that strong leadership is critical.

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We’ve worked with companies of all shapes and sizes during the pandemic and have seen what many CFOs did right during the crisis.


Cash, as they say, is king. During COVID-19, many companies had to close temporarily, while others experienced a major slowdown in revenue-producing activities or a disruption in their supply chain. For many small to mid-market companies, that caused liquidity problems and financial stress.

CFOs who maintained adequate cash reserves or had access to cash (such as a line of credit) wisely positioned their companies to deal with the immediate cash shortage. Many CFOs were proactive with lenders and accountants, and showed a willingness to ask for assistance and educate themselves. These CFOs were able to make quick decisions and take early advantage of loans, grants, working capital resources, and federal legislation such as the Paycheck Protection Program (PPP) and the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Also, many lenders provided debt covenant relief to alleviate further burden. Financial modeling and projections based on different scenarios gave CFOs the ability to keep business owners, governance (board of directors), and management — basically, all the key stakeholders — informed on certain outcomes. To cure the liquidity problems and the resulting financial stress, some CFOs also tightened up on cash collections and sought short-term relief on accounts payable and debt obligations.


Once their company’s cash position was secured, smart CFOs next focused on stabilizing their business: they found ways to increase revenue and decrease operating costs. Companies that added extra support to profitable revenue streams and spent less time on unprofitable revenue streams maintained or increased revenue during the crisis.

Many companies were forced to lower operating costs, such as rent and payroll. However, they also performed a balancing act to position the company for growth once the economy recovers. CFOs who spent time performing financial planning and analysis, and who communicated well with stakeholders, were able to stabilize their business. This stabilization period provided CFOs with a good opportunity to clean up a company’s balance sheet, which included:

  • Re-evaluating investment portfolios
  • Performing a goodwill impairment analysis
  • Refinancing debt
  • Reducing inventory

Position for the new normal

At the end of the stabilization phase, companies focused on ways to position themselves for the new normal. Many CFOs began strategic planning with all stakeholders.

The strategic planning efforts varied by company based on industry, geography, and company size. However, using a team approach was often most effective. A company can grow a number of ways in the new normal, but a few ways in particular include:

  • Appropriate resource allocation
  • Wise expenditures decisions
  • Maintaining the ability to adapt quickly
  • Willingness to think outside of the box

Strong CFO leadership

For a small to mid-market company to survive and grow during the COVID-19 crisis, it must have strong financial leadership. Whether it’s a qualified internal CFO or an external outsourced CFO, he or she must be a good communicator, someone who has the ability to inform all stakeholders of the knowns and unknowns — especially during the toughest of times.

How we can help

As the impact of COVID-19 continues to unfold, we are here to help your company handle its financial needs, which includes providing outsourced CFO services and real-time scenario modeling. That way, your organization can make better decisions in challenging times.

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