Resilient Growth: 3 Leadership Strategies for CFOs in Uncertain Times

When chief financial officers (CFOs) find themselves steering their businesses through an uncertain economy – one driven by conditions like inflation, increased interest rates, or signs of risk in the banking system – their ability to manage and drive growth can be put to the test.

During these turbulent periods, executives must often make difficult decisions that can require them to dig deep into organizational processes and make adaptations to shepherd their businesses safely through stormy weather. For example, nearly four in 10 CFOs (36%) say their financial planning and analysis teams are altering forecasts at least weekly to respond to ever-changing market conditions.

Agility – the ability to renew, respond, and adapt in a rapidly changing environment – is at the forefront of successful leadership strategies. CFOs willing to embrace change and be proactive can be better equipped to foster team engagement and propel revenue growth. 

These three strategies may help CFOs develop organizational agility, stability, and growth, both now and in the future.

Step 1: Embrace the Possibilities of Technology

The need to perform and encourage growth during challenging periods can add urgency to digitizing processes and workflows. Executives who run large enterprises seem to understand that this transformation is a critical objective.

A 2023 PwC survey of 600 CFOs identifies embedding new technologies as the most important strategic priority, even over strategies like outsourcing, acquisitions, and reorganizing operational models; 59% of these leaders planned to invest in new technologies in the next 12 to 18 months, and more than half of finance leaders (59%) pointed to cost reduction as the driving force behind their technology investments.

In an era marked by a historically tight labor market and escalating costs, large companies often place greater responsibility on their financial leaders to drive revenue increases and productivity enhancements.

To respond, CFOs may want to seek out efficiency opportunities like these to stay current.

Cloud-based performance analytics: Spreadsheets with web-based automated finance platforms can track KPIs and provide real-time performance dashboards to help speed up manual processing. This aggregated information may also make key data stories emerge faster and more clearly. 

AR/AP Automation: Affordable automated expense management may help financial teams strategically manage cash flow and provide advanced finance metrics for better analysis and decision-making. According to American Express Lens' 2023 Global & Large Decision Maker Survey, 44% of decision makers reported AR/AP automation isas a priority. Within the United States alone, this number increased to 50%.

Robotic Process Automation (RPA): Software that automates tasks, such as data entry and file transferring, may help CFOs tackle delays, improve error-prone processes, and provide visibility into processes. 

Ultimately, CFOs who can analyze operational bottlenecks and create automation roadmaps may free up entire departments to do higher-value work, which could contribute to smarter decision-making, greater efficiency, and improved employee satisfaction.

Step 2: Stay Flexible

The conditions under which companies do business are constantly changing. A 2023 Bain & Company article says that preparation for shifting “what-if” circumstances can be key in allowing CFOs to remain flexible.

Scenario planning and risk management help identify options for proactive responses, robust alternative plans, stress-tested financial models, and analyses of potential outcomes under different conditions.

In a 2024 CFO Report from FTI Consulting and CFO Dive, nearly every finance leader surveyed (90%) spent more time in 2023 on scenario planning around forecasting than they did in 2022.

Scenario-based financial models might assess the potential impact of disruptive events, such as natural disasters, supply chain interferences, or regulatory changes. If any of these simulations become reality, CFOs can lead confidently with strong contingency plans instead of being caught off guard.

In a 2023 Deloitte survey, only 12% of CFOs report being "very satisfied" with their companies' decision-making to plan for a downturn/recession. For a recovery/rebound, only 14% are "very satisfied." This indicates financial leaders of large enterprises may need to prioritize scenario planning to respond to challenges and opportunities as they arise.

Step 3: Make Strategic Investments

In a challenging market, CFOs may sometimes feel like they’re walking a tightrope as they search for a balance between cutting costs and establishing growth initiatives. The key to making strategic investments is to balance potential benefits with associated risks.

For example, payment and spend management company Fleetcor Technologies sets strategic priorities and goals using a four-pronged process that cultivates expected results: evaluate, diagnose, report, and allocate.

To get investments right, CFOs can consider partnering with chief information officers (CIOs) and chief transformation officers (CTOs) to evaluate risks and controls, align priorities, and make investments that align with market changes.

For many CFOs, strategic investments in technology and workforce development are critical. According to a 2023 report from advisory firm Grant Thornton, over half of CFOs surveyed planned to increase their enterprises' IT and digital transformation spending in the next 12 months. Additionally, 58% said attracting and retaining talent is a priority.

The Takeaway

Ultimately, embracing technology, making strategic investments, and fostering flexibility can position CFOs – and their companies – for sustained growth. Though leading through instability can be a challenge, committing to agility may help leaders pivot, adapt new mindsets, and confidently step into the future empowered with the right strategies, tools, and partnerships to succeed.