The pandemic has forced businesses of all types to change their focus. Manufacturers and distributors are no exception. In a recent survey, CFOs and finance executives were asked how COVID-19 changed the way they do business. These finance leaders revealed they are shifting their priorities in 2022 to adjust to changing business needs. While top priorities varied heavily by industry in terms of actual ranking, US finance executives surveyed consistently identified the following 5 critical areas of focus for 2022:
- Increased Investing in eCommerce and Digital Transformation Initiatives
Over half (51%) of total respondents agreed that investing in eCommerce platforms and digital transformation initiatives is top of mind this year. This is especially critical to the US Food and Beverage industry respondents (69%). It makes sense as lockdowns and restricted trade continue to hinder business growth—organizations are opting to take their trading operations into the digital space.
- Controlling Cash Flow and Margins
At 40%, managing working capital (vs. investments), cash flow, and rising inventory costs rank as the second-highest CFO priority for 2022. With logistical pressures currently placed upon supply chains, companies have noted that the costs of inventory management have the potential to rise to unforeseeable levels. Managing cash flow and margins remains a key objective for US finance leaders, based on our survey in 2020, 2021, and now into 2022.
- Increased Business Visibility
In times of crisis, companies require greater real-time visibility of their operations to pivot and manage accordingly. It’s no surprise that 33% of US survey respondents ranked improving visibility a top area of focus as we continue to navigate the business in a sea of uncertainties. Increased business visibility can be achieved with modern software like ERP and a digital strategy, preventing problems such as overruns, bottlenecks, downtime, poor employee or machine performance, and excessive scrap.
- Risk Management
At an overall response rate of 30%, CFO respondents agree that managing governance and risk is a critical focus area for 2022. This is especially important to 44% of Food and Beverage and Industrial Machinery and Equipment manufacturers as rapid changes, unpredictability, and increased regulation and compliance requirements continue to impact businesses on a global scale.
- Reducing Reliance on Spreadsheets
Eliminating manual processes is key to staying competitive, and 22% of finance leaders agree that now is the time to address an over-reliance on spreadsheets. The predominant industry ranking in this area of focus is Furniture and Fittings, at 46%. The risk of running a manufacturing or distribution business with inefficient or misaligned financial information is far too great to ignore, and a 360-degree ERP software solution is a must.
These crucial insights into manufacturing CFOs' financial focus just scratch the surface. For more information, download the manufacturing CFO survey report. It addresses how the pandemic has impacted the manufacturing and distribution industries globally. The report also discusses the critical role of the CFO.
If you are looking to make a change in your financial software this year, contact PositiveVision. We can help you prepare for a healthy future.