Pandemic lessons for the next global crisis

Here are lessons from the coronavirus pandemic, compiled in a toolkit, for whatever challenges may lie ahead.
Pandemic lessons for the next global crisis

The coronavirus pandemic accelerated business trends that were emerging before efforts to contain the virus shocked economies worldwide.

Remote working will be more common. Multinational companies are considering regionalising and localising their supply chains. The digital economy will play a bigger role, and along with it the flow of data. Automation is expected to increase.

Many companies that have thrived during the crisis are likely to continue to benefit. But regardless of how much or how little a business struggled, the decisions made, experiments launched, and lessons learned during the early days of the crisis are valuable assets to carry into 2021. These ideas can improve resilience and ensure business continuity once the pandemic is over.

From cash management to data analytics to strategic pivots, the pandemic has given the finance function a chance to demonstrate its value as a business partner, as Stephan Burow, ACMA, CGMA, put it. Burow is vice-president of finance at Gousto, a UK company that delivers ingredient and recipe kits for making meals to customers' homes. When people started cooking more at home and customer demand soared, outstripping the company's ability to fulfil orders, Burow used data analytics to help with daily forecasting. As a result, Gousto prioritised filling orders of existing customers over acquiring new customers, kept the supply chain flexible by changing recipes, and managed the risks the business was facing.

Gousto's lesson was just one of many that management accountants and finance professionals from around the world have shared in FM magazine since the pandemic began. Here is a compilation of more tips, tactics, and strategies in three categories — business strategy, cash management, and risk management.

Developing a strategy out of the crisis

Financial planning methods are evolving quickly as companies seek to recover from the coronavirus pandemic and grasp emerging opportunities. These three methods can help with strategic decisions.

Scenario planning

Crises require real-time planning methods, rapid simulation, and modelling techniques to adjust to evolving events:

  • Adjust planning parameters, such as how often management should meet and how far out forecasts should look, to account for rapidly changing conditions.
  • Assess what technology is needed to collect and analyse more business intelligence data more rapidly and efficiently. Determine whether it makes sense to partner with organisations that can help aggregate and analyse data on a global level or across industries. Such partners may be software companies, public-private efforts such as the UK Royal Society's Rapid Assistance in Modelling the Pandemic (RAMP) initiative, or corporate data-sharing alliances.
  • Identify business drivers that are representative of the crisis. Determine how the crisis is affecting revenue, cash, and customers' online and offline spending behaviour and whether the crisis is disrupting the supply chain from source to customer.
  • Model rapid changes to external factors (infections and deaths, unemployment, public health regulations and rules, government stimulus, industry-specific impact) and track them to spot trends in different markets.
  • Create evidence-based playbooks based on the scenarios. Plans in the playbook should address extreme highs and lows and include mitigation strategies, such as delaying purchases, managing expenses, and shifting inventory geographically.

Forecasting and budgeting

A crisis may require a business to throw out its budget and pivot at short notice:

  • Take a look at the business's cash flow forecast and cash reserves.
  • Run scenarios from the prepared playbook and figure out the most likely effects on the business.
  • Revise performance targets as data becomes available and ensure they have a meaningful time horizon under the circumstances. Use industry peers as yardsticks.
  • Update forecasts as often as needed and look ahead as far as possible to enable decisions. If conditions are volatile, replacing forecasts with a few high-level scenarios is an option.
  • Allocate resources as late as possible and base decisions on the latest dynamic cash forecasts.
  • Monitor actual developments through trend reporting, control charts, or other reporting methods to better understand what has been and might be happening.

Staying on track

Board leadership can protect employees, ensure the financials are strong enough to ride out the crisis, and advise management to look for potential business opportunities.

  • Pressure-test management's assumptions about the financial, strategic, and operational implications of the crisis.
  • Ensure effective crisis management reporting. Board members should know what information they can expect to receive from management and how frequently. To help the board understand what's going on, management should report on key indicators that represent operational impact, risk mitigation, and business recovery.
  • Evaluate management's communication strategy with employees and external stakeholders to prevent damaging communication failures during the crisis.
  • Advise management to develop post-crisis recovery plans that could call for structural changes.

Getting a handle on cash

Survival and recovery depend on generating cash. Finance can add clarity and steer the business through the crisis with these tactics:


To manage the risk to liquidity, a business will need rolling cash forecasts. Management may carry them out under multiple scenarios to understand the potential range of outcomes and assess the broader potential range of the company's cash position. Any aspect of the business with enough impact to "move the cash needle" should be forecast in enough detail to allow for monitoring and action.

Several key areas have a significant impact on cash flow and warrant particular attention, including payments from customers, payments to suppliers, and payroll.


Using the detailed forecast, finance leaders can then look at each category of spend and prioritise based on what provides the business with the greatest level of resilience. 

Key targets for cash flow optimisation include:

  • Credit control: Check for overdue invoices and get commitments to pay; prioritise customers that pay more quickly; and harmonise credit terms so they are the same for each customer across the company's different business units.
  • Inventory: Consider consignment stock agreements to hold supplies as stock and pay for them when sold; expedite orders that have not been shipped; unpack inventory and get it on the shelf; and sell merchandise that has been stocked for a long time, at a loss if need be.
  • Manage creditors: Plan to pay large invoices; communicate regularly with key creditors; and expedite ageing, unpaid invoices to avoid debt build-up.


Internal and external communication strategies must be drawn up that focus on stakeholders affected by the cash plan. Suppliers and creditors need as much lead time as possible if the intention is to break normal payment terms. Similarly, dialogue should be opened early with those customers identified as critical for receipts.

Transparency and honesty will go a long way to safeguarding business relationships post-crisis.

Look ahead

Identify points when cash will run low, and devise specific plans to cover them. Operating actions such as reduction of inventory, early receipts from customers, and slower payments should be planned at a detailed level, then recorded and tracked as part of the forecast. Thereafter, financing will be required to cover any existing holes.

Risk management lessons

A crisis like the coronavirus pandemic amps up risk management, forcing executives and employees to adapt to remote work, learn new technologies, and find new ways to serve clients and customers. Businesses worldwide have to quickly figure out how to manage the risks, probe the unknowns, and gain a better sense of what may lie ahead.

Technology such as data analytics is useful to assess risks and map out scenarios. Finance leaders' appreciation of agility heightens as supply and distribution chains are upended, cash flow and working capital are affected, and the health of entire workforces is endangered. And where planning, management, communication, and leadership fall into place, new business opportunities emerge from the crisis. (See the sidebar, "Leadership Counts in a Crisis," for more advice.)

Lessons learned suggest that as a crisis unfolds, these risk management areas are critical and merit particular attention:

Employee safety

Keeping employees healthy is a top priority. Companies have multiple options available in a pandemic, including allowing employees to permanently work from home where possible, reconfiguring workplaces and staggering shifts to assure social distancing, cleaning and disinfecting workstations, and taking temperatures and evaluating contact-tracing and location-tracking tools.

If employees are mandated to return to workplaces, they should be given clear reasons as to why, and management should consider offering hazard pay and benefits in recognition of their commitment to return to work.

Fraud prevention

The upheaval and uncertainty during a crisis are usually invitations for fraudsters looking to catch individuals and businesses unawares. In the pandemic, scores of office employees suddenly working remotely present a major fraud risk that scammers could try to exploit.

Finance professionals are prime targets for phishing scams by criminals hoping to defraud companies with a large remote workforce.

To prevent attacks, cybersecurity experts recommend finance professionals become aware of phishing scams typically targeting them. The fraudulent emails sent by scammers often have the appearance of coming from the company CFO, human resources, or not-for-profit organisations generating statistics, and have malware embedded.

Also, employees should use computers with updated software and access company applications with multifactor authentication.

Supply chain disruption

Just-in-time inventories, lean supply chains, and, in general, a business continuity plan that relies on insurance as a bailout represent major risks to surviving a crisis.

Caught unprepared by supply chain disruptions, a business is left with few options. Finance and risk leaders must quickly adjust purchasing and production based on the company's risk appetite.

To better prepare for the next time around, experts suggest businesses audit all tiers of their supply chain to look for weak links, diversify their supplier bases by building relationships in different parts of the world with suppliers that can provide goods of a similar standard, and include backup suppliers in their business continuity plans.

The best business continuity plans are comprehensive, written down, tested, and periodically updated, and include scenarios where operations are severely disrupted by external events.

Mitigation of financial shortfalls

Businesses have several options to rebuild revenue streams when sales drop off rapidly in a crisis. They can adjust pricing and offer different payment terms, shift from in-person to online sales, target new customers, offer new products, enter new markets, and seek support in mergers and acquisitions, joint ventures, or alliances.

Businesses around the world successfully mitigated the pandemic's impacts. Here are a few examples of pandemic pivots:

  • The owners of The Local Grill, a steakhouse in Johannesburg, South Africa, covered payroll and operating costs by filling orders for meat and frozen foods and selling vouchers for future dinners while the restaurant was closed.
  • Cinelab London, a UK film laboratory and post-production company, emphasised archival and preservation work when the pandemic shut down movie shoots across the world.
  • BrewDog, a UK brewer and distiller operating 102 bars worldwide, made use of parts of its operations to produce hand sanitiser and distributed it free to healthcare services, charities, and other frontline workers.
  • Sharent, a Singapore startup that began in the customer-to-customer business segment, where individuals can rent or share underutilised assets such as a high-end baby carriage or an evening gown, switched segments. Within weeks, the startup generated a new source of revenue by helping a thermal disinfection machine manufacturer rent its machines to businesses in Singapore.

Leadership counts in a crisis

Leaders who convey a sense of caring and empathy can prevent conflicts and reassure employees in a crisis. That helps finance teams stay connected, cohesive, and productive. Good leaders should consider the following:

  • Be a role model. Set up a personal self-care plan with scheduled breaks and peak attention hours. Model emotional vulnerability to create a workplace where people feel comfortable sharing in virtual town hall or check-in meetings. Schedule tasks ahead of deadlines.
  • Learn to read the virtual room. Ask your colleagues how they are feeling, and pay attention to body language.
  • Accept that everybody makes mistakes. When you stumble, acknowledge the gaffe, explain your intent, and ask for suggestions.
  • Watch out for uncharacteristic behaviour and check in with colleagues you haven't seen in a while. Make sure you don't forget anybody.
  • Schedule online coaching sessions to support colleagues. Listen attentively, don't interrupt, respond without judgement, and ask what they need.
  • Be aware that you might not have all the answers.

'What we mean by cash war room is an infrastructure which allows you to rapidly get organised around key cash events, key cash KPIs, key cash metrics. And more important than having the metrics and the data is creating a cash culture within the organisation. Organising executives around the need for cash, a cash mindset, and that we need to really look at each and every action we are taking with that framework. And then finally, creating a bit of a central team which is looking and managing all of the cash-related items, whether it is receivables, payables, purchase orders outstanding, what are the incoming sales.'

Ankur Agrawal, McKinsey partner, healthcare and strategy and corporate finance practices

"How CFOs Can Create a COVID-19 Crisis War Room", FM magazine podcast episode, 20 April 2020

'Managing cash is a fundamental activity for any business, and there is no magic wand. What is needed is continuous monitoring and measurement of the areas where companies know problems arise, for example, payment delays from particular customers, slow-moving higher-value stock, or certain suppliers that generate the majority of payment queries. There's nearly always a Pareto effect whereby a minority cause most problems and another minority are the most valuable. So, it is important to understand the story behind the numbers, as some relationships are valuable to the business and some are not.'

Mark Gault, ACMA, CGMA, UK-based business architect at Gault & Co. Ltd.

"Crisis Basics: Managing Cash", FM magazine, 17 June 2020

'The business continuity plan needs to cover several types of risks, both internal and external. Examples of external risks are hurricanes, fires, floods, pandemics, while examples of internal risks can be internal fraud or supply chain issues. What is really important here is that the plan should be generic enough to cater for all these types of scenarios, but specific enough to be able to instruct on specific actions that need to be taken based on the type of impact that these scenarios have on the company.'

Cecilia Locati, FCMA, CGMA, vice-president for risk, internal audit, and compliance at RHI Magnesita, a global supplier of high-grade refractory products based in Austria

"The Traits of a Strong Business Continuity Plan", FM magazine podcast episode, 10 June 2020

'What a scenario plan does is before the crisis hits, it allows you to think through if it did, what would the likely things happen that we're seeing today, and, therefore, what plays could the organisation run in terms of having cash reserves, in terms of shifting to other approaches, in thinking about what happens if restaurants shut down or clubs shut down. How would you shift your business? What would you do? What could you do with your employees and so forth? Those sets of playbooks are what a good scenario plan would have in place.'

Steve Player, CPA, CGMA, owner of US consulting firm The Player Group

"Steering Your Budget Amid Coronavirus Uncertainty", FM magazine podcast episode, 23 March 2020

'The first thing I would suggest is invest in the rapid development of emotional intelligence, in self and team and organisation. And I'm not just talking about going out and getting a course on emotional intelligence. I'm talking about emphasising that skill within your organisation and really helping people integrate these three legs of the stool that make up the human being. So, our cognitive superpower, our physical bodies, which include both our capacity to do as well as feel, and then our emotions, right? We need to have all three of those systems running at the same level of operating software.'

Gretchen Pisano, the CEO and co-founder of pLink Leadership management consultancy

"6 New Business Realities in the Pandemic Era", Journal of Accountancy podcast episode, 13 August 2020


Many management accountants and finance professionals from around the world have shared their knowledge in FM magazine since the pandemic began. Those whose tips, tactics, and strategies are set out here include:

Developing a strategy out of the crisis

Janneke Abels, vice-president of group planning for energy company Shell.

David A. J. Axson, US strategist, consultant, and author.

Mark Birkin, co-director of Leeds Institute for Data Analytics in the UK.

Bjarte Bogsnes, heads the implementation of Beyond Budgeting at Equinor, Norway.

Chris Ortega, director of finance, Americas at Emarsys.

Steve Player, CPA, CGMA, owner of US consulting firm The Player Group.

Getting a handle on cash

John "Jack" Alexander, CPA, experienced CFO and operating executive turned adviser, author, and lecturer based in the US.

Mark Gault, ACMA, CGMA, a UK-based business architect at Gault & Co. Ltd.

Andy Gifford, ACCA, partner at Falcor BC, a UK accounting and business coaching practice.

Senaka Kakiriwaragodage, FCMA, CGMA, acting CEO at NBD Capital Holdings Limited, an investment bank in Sri Lanka.

Risk management lessons

Nadim Ahmad, UK restructuring and turnaround expert.

Heidi Allan, HR consultant in the UK.

Joe Anichebe, UK finance director at Northgate Vehicle Hire.

Will Barkway, people and culture specialist and a partner at PwC in the UK.

Lyndy van den Barselaar, FCMA, CGMA, managing director at ManpowerGroup South Africa.

Mark Beasley, CPA, KPMG professor of accounting and director of the Enterprise Risk Management Initiative at North Carolina State University in the US.

David Biggs, ACMA, CGMA, the CFO at Farewill, a wills, cremation, and probate company in the UK.

Tim Burghout, ACMA, CGMA, head of business development and PMO at retail wholesaler Metro China.

Melanie Butler, partner at PwC UK.

Sherrod DeGrippo, senior director of threat research and detection at cybersecurity firm Proofpoint in the US.

Alex Etchells, co-owner of Blackstrap Craft Distillery in KwaZulu-Natal, South Africa.

Aidan Goddard, FCMA, CGMA, vice-general manager and CFO of Kärcher Investment China.

Julia Graham, deputy CEO and technical director of Airmic, the UK-based association for professionals who are leading organisations' risk management or insurance.

Alyn Hockey, vice-president of product management at the UK cybersecurity firm Clearswift.

Gaurav Jain, FCMA, CGMA, the CFO at the Indian branch of French insurance company AXA.

Ivan Yong Wei Kit, angel investor in Hong Kong.

Koray Köse, supply chain expert with the global research and advisory firm Gartner.

Cecilia Locati, FCMA, CGMA, vice-president of risk, internal audit, and compliance at RHI Magnesita, Austria.

Rajnish Magan, FCMA, CGMA, the CFO at Beumer India.

John Mahtani, ACMA, CGMA, Cinelab London's co-founder and chief commercial officer.

John Manners-Bell, chief executive of UK-based market research company Transport Intelligence.

Llewy Mateza, owner of The Local Grill, a steakhouse in Johannesburg, South Africa.

Matt Miller, FCMA, CGMA, the CFO at the UK's National Nuclear Laboratory.

Ian Pettifor, FCMA, CGMA, group CFO of insurance technology firm Azur Underwriting in the UK.

Ben Press, ACMA, CGMA, retail finance manager at BrewDog, a UK-based brewer and distiller.

Rajesh Ray, ACMA, CGMA, the CFO and head of finance at ZeOmega India.

Amrish Shah, FCMA, CGMA, former head of financial planning and analysis at media production business Endemol Shine Group in the Netherlands.

Mary Stojcevski, the CFO and executive director of Dicker Data, an IT distributor in Australia.

Stephen Sutcliffe, director of finance and accounting for the Shared Business Services unit of the UK's National Health Service.

Tom Teixeira, head of the risk advisory practice at Arthur D. Little, an international management consultancy based in Brussels.

Joanne Watmore, ACMA, CGMA, financial controller at Equilibrium Financial Planning in the UK.

Leadership counts in a crisis

Ted Delgado, CPA, CGMA, director of financial planning and analysis at Hershey's Amplify Snack Brands.

Paul Leroue, a leadership coach and principal at US-based accounting firm Wipfli.

Loretta Outhwaite, FCMA, CGMA, wellbeing coach and deputy director of finance at the National Health Service, Isle of Wight.

Sarah Rice, chief people officer at Skynamo, a South African technology company.

Mike Sapperstein, CPA, CGMA, manager at Rosen, Sapperstein & Friedlander LLC in the US.

Lindsay Stevenson, CPA, CGMA, vice-president of finance at 1st Financial Bank USA.

Sabine Vollmer is an FM magazine senior editor. To comment on this article or to suggest an idea for another article, contact her at