Unprecedented events like the COVID-19 pandemic compel businesses to challenge established routines and revisit outdated strategies. The inefficiencies that usually remain hidden behind buffers and manual interventions become impossible to ignore when markets crash and supply chains falter. As Warren Buffett once noted, “Only when the tide goes out do you discover who's been swimming naked.”

In a crisis, the immediate priority isn't transformation—it's survival. Adapting to a post-COVID world comes later. For now, preserving liquidity is critical. With revenues under pressure and access to funding tightening, businesses must turn their attention to the balance sheet and rapidly improve working capital. Organizations that lack a short-term cash forecasting model should implement one without delay to improve visibility, enable proactive decision-making, and activate fast cash-saving measures.

Beyond Survival: Thriving in a New Reality

Those who weather this crisis must prepare for what comes next. As the dust settles, companies face a choice: stick with what was "good enough," or seize this moment to pursue meaningful improvement.

Why strive for better when the status quo seemed sufficient? There are two compelling reasons:

1. The pace of disruption is accelerating—from pandemics to climate events, technological advancements, and demographic shifts, the business environment is becoming increasingly volatile.
2. Standing still is not an option. In a competitive landscape, stagnation equates to decline. The wave of high-profile bankruptcies during the pandemic—including giants like Hertz—proves that no company is too large to fail.

Strategic Focus Areas for Resilience and Growth

1. Treat the Balance Sheet as a Strategic Asset

Management often prioritizes the income statement, but cash flow and balance sheet health are equally critical. Working capital metrics like DSO, DPO, and inventory turns reveal how efficiently a company runs. Lean working capital unlocks liquidity, minimizes dependence on external financing, and strengthens agility—crucial traits in uncertain times.

2. Foster Integrated and Flexible Planning

In a fast-changing environment, the ability to replan quickly across departments is vital. Plans must reflect an end-to-end view of processes to avoid internal misalignment. For example:

- Sales commits to faster delivery and broader availability;

- Inventory is cut to reduce holding costs;

- Procurement negotiates discounts by buying in bulk.

Individually logical, these actions can cancel each other out unless strategically coordinated. Misalignment creates friction, undermines performance, and leads to missed targets. Cross-functional alignment, supported by clear governance and modern planning tools, is essential for sustainable results.

3. Strengthen Relationships Across the Value Chain

Many businesses use their market position to push terms onto suppliers—longer payment cycles, lower prices, and stricter conditions. While seemingly beneficial short-term, this often backfires. Suppliers pass costs back, reduce service levels, or exit the relationship. Switching vendors incurs cost, risk, and disruption.

A better approach is collaborative: leverage strengths to foster mutual gains. Tools like supply chain finance (SCF) can support this by offering liquidity to partners while maintaining working capital efficiency. A resilient value chain thrives on partnership—not pressure.

In Summary

Navigating a crisis requires a dual focus: immediate stabilization and long-term resilience. In the short term, robust cash forecasting and tactical liquidity measures are vital. In the long term, businesses must be ready for future shocks through agile planning, lean operations, and strategic supplier/customer collaboration.