CFO Leadership: The 2023 Balancing Act Moves into High Gear

Six months can make a difference in expected results during volatile times, especially when the velocity of change compounds the degree of difficulty as it has to date. So, The CFO Alliance reached out to emerging and mid-market CFOs with a Mid-2023 CFO Checkpoint Survey that would spot-check what may have changed since the findings of the 2023 Global Mid-Market CFO Sentiment Study (download here) were published at year-start. The study’s objective was to discover how enterprises were coping with the external and internal forces experienced in the first half and how they might be affecting their growth goals and forward planning.

The Early View on 2023

At the start of 2023, CFOs had internalized the instability associated with inflation, the cost of capital increases, talent voids, and the looming threat of recession. On the plus side of the ledger, were the benefits expected to flow through from their prior years’ efforts to reduce supply chain costs, manage inventories, and drive ROI accountability sufficient to allow growth investments in marketing, sales, technology enablement, and workforce development. Summarily, they were more bullish than their counterparts in larger enterprises about meeting their full-year revenue and gross margin targets (80% confidence level).

What Has Changed and What Has Held Steady?

For CFOs to balance cost containment with growth investing is nothing new historically or for however “normal” may be defined today. This was clearly evident in the mid-term findings.

• CFOs planned ahead for inflation; 87% were neutral or better on inflation.
• Revenues were trending less than expected for roughly 50% of the enterprises in the first-half and Finance has taken the reigns to counter-balance potential full-year shortfalls with cost containment measures that are maintaining margins and yielding a positive outlook on achieving their EBITA plans.
• With 28% of Finance teams operating at least “a person down” and 44% anticipate workloads to increase, Finance is sharing the pain and expecting it to worsen at a time when the 2024 planning process will overlay the drive to optimize rest-of-year results.
• 2024 planning will take on a constraint-based mindset that internalizes the higher cost of capital, potential hiring freezes, and the re-rationalization of marketing spend and selling strategy to ensure the top line improves.

The bottom line is that CFOs are proving to be vigilant and agile with real-time pivots to optimize headwinds and further threats of shortfalls FIND OUT MORE by downloading The CFO Alliance Mid-2023 CFO Checkpoint Report (here).

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LEAD – LEARN – CONNECT – GROW are the four pillars of value creation underpinning the purpose of The CFO Alliance. We understand the CFO role like no other and continuously innovate to ensure high business value for our Member community. For 12 years running we have facilitated the most trusted and constructive conversations among peers globally. To enable the success of Members’ businesses and personal career growth, we support them with access to hyper-relevant benchmarking data, proven methodologies, meaningful insights, SMEs, and structured learning and personal development opportunities. CONTACT US (Greg.wood@thecfoalliance.com) for a no-obligation discussion.