Published: 09 April 2020
Analyst(s): Corporate Strategy Research Team
Here’s a roll-up of pandemic-related executive sentiment and insights from thousands of functional leaders across the C-suite.
Fast word on tactics and concerns from thousands participating in our conference calls and polls.
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Business leaders see the sustained global pandemic intensifying impacts on sales revenues, employees and core operations (see Figure 1).
Major cash flow decisions are now being taken at the C-suite level by the CFO or COO. They want more visibility into areas of concern so that they can predict potential liquidity issues and take preemptive action to increase cash flow.
Among the steps CFOs are taking to improve visibility for decision-making are...
Setting cash flow triggers for actions agreed upon with the executive team and approved by the board
Centralizing the company’s receivables infrastructure
Requiring alerts directly to the CFO when a receivable isn’t paid by term
Forecasting cash flow more frequently (weekly or even daily) with more top-down analysis
Updating management on payments, inventory and receivables on at least a weekly basis.
The most common actions taken by firms negatively impacted by COVID-19 are: drawing down available credit (53%), slowing vendor payments (47%) and accessing government stimulus funds (45%). For a more detailed breakdown, see Figure 2 below:
CFOs are forecasting whether liquidity could affect critical payments like employee salaries...
12% expect liquidity to become an issue for critical payments within the next 60 days
44% don’t think it will be an issue for at least 180 days
26% don’t anticipate liquidity becoming an issue at all
Chief Sales Officers (CSOs) are shifting capacity to healthier business segments and guiding their teams to prioritize existing accounts over new business:
Urging sellers to reinforce customer relationships by being empathetic and sensitive, while avoiding overt promotional messages.
Providing conversation playbooks to sellers to highlight work done together with key customers over the past year.
Embracing virtual sales and investing in digital marketing; a quarter of CSOs now say they are considering a permanent shift to virtual selling.
Focusing more on one-on-one interactions and creating personalized content for customers.
Adjusting annual compensation plans to a quarterly basis while guaranteeing minimum compensation for sales employees, ranging from 75% to 95% of their targets.
Assigning some sales personnel to offer customer care when customer support centers are experiencing additional demand.
Managing expenses so the sales force is ready to mobilize when pent-up market demand is released.
Infrastructure and operations (I&O) leaders are encountering far less resistance than they were pre-crisis to boosting IT capabilities that support remote work and strengthen security.
Among the steps I&O leaders are taking are...
Expanding the use of collaboration tools, including document sharing systems and video conferencing, combined with ramped up VPN capacity
Investing in secure technology for priority third parties with lagging IT capacity
Experimenting or fully investing in technology to monitor and manage issues with the ‘last mile’ to home internet providers
Rolling out secure web-based telecom to switch call center operations to home-based work
Providing high performance VPN capabilities for priority activities
Working with legal and compliance to solve challenges like verifying a customer’s identity or introducing new e-signing technologies
Legal, compliance and privacy leaders must balance the needs of a safe workplace with the employees’ right to privacy. Some new workplace safety measures they are collaborating on with HR:
Requiring supervisory approval for any employee returning to, or remaining in the workspace.
Requesting personal travel history, which may be done through an online travel survey sent to all employees.
Administering temperature checks in private by a healthcare professional, and privately sending home at-risk employees to protect employee privacy.
51% of legal and privacy teams are reinforcing privacy expectations in the context of remote work. Almost a third of their organizations are improving employee monitoring through partnership with IT, and almost a quarter are conducting regular temperature checks (see Figure 3).
Assurance functions face new budgetary constraints just as they must evaluate a transformed risk landscape. Eighty-two percent of auditors say they have already or will begin remote auditing in response to the COVID-19 crisis by the end of 2020.
Some credit their resilience to investments indata analytics prior to the crisis. They are also adopting a more flexible approach.
Kenny Zheng, global internal audit senior manager at Mars has turned one audit into a consultation when a regional office was severely constrained. In Italy, he wanted to “help them ensure controls didn’t fall apart as they went through the situation.”
Paul Hamaker, global audit manager at Heineken says he’s preparing for the time when auditors can return to the field now by “prioritizing the scoping and risk preparation. Later in the year, when we’re able to travel on-site, we’ll focus on execution.”
The impacts of COVID-19 need a cross-functional response. Access all of our research to help your partners in assurance, supply chain, HR, IT and others act quickly and confidently. You’ll find tips, toolkits and other planning advice.
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