@Risk

Accenture recently polled 1,000 chief financial officers (CFOs) and chief marketing officers (CMOs) and found that most are “holding the reins tightly” when it comes to price competitiveness and increasing costs.

The vast majority (85 percent) of those who participated in the study said they do anticipate growth. But they also reported that continued economic uncertainty is forcing a more disciplined approach, one that focuses on cost management and the prudent use of cash.

For example:

• Nearly 90 percent of survey participants said price competitiveness is a primary strategic issue and that they expect to continue to maintain or cut costs and build cash positions further.

• Nearly three out of four CMOs surveyed (71 percent) said pricing is now among their companies’ top three strategic priorities. More than two thirds (71 percent) of the combined group of CMOs and CFOs believe they will have to maintain pricing, or even drop prices, given the current economic environment.

• Virtually all are eyeing additional cost-cutting. Continued pricing pressure, combined with persistent uneasiness among executives about the prospects sustainable global economic growth led 99 percent of survey participants to indicate that their companies would be pursuing some additional level of cost-cutting.

• 70 percent of respondents indicated that their companies have optimal-to-excess cash positions relative to current business demands, and nearly 90 percent have teams in place (some permanent, some temporary) focused on continuing to improve working capital productivity.  Roughly one third of the CFO participants indicated the need to continue generating cash to allow for opportunistic investments, increased R&D and/or future operational necessities.

Coupled with this disciplined approach to cost management, the study found that the CFOs and CMOs polled expect major impacts to their growth to result from improved product value, innovation and promotion across their businesses. (more…)

Are CFOs waving a cautionary flag?

As I see it, companies remain focused on growth. But, a new Q2 study from Deloitte indicates that CFOs are still concerned about economic recovery while becoming increasingly worried about both external and internal factors that threaten their progress.

The CFO Signals survey found that:
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Optimism among chief financial officers in the US has increased, rising to its highest level since early 2007, according to the most recent Duke University/CFO Magazine Global Business Outlook Survey.

The quarterly survey, which concluded March 3, found that most of the 854 CFO polled expect robust growth in earnings (18 percent) and capital spending (12 percent), while overall employment moves forward, as well, albeit more slowly.

Here are a few additional key findings from the research: (more…)

Analysts continue to debate how long it will take for the global economy to return to “business as usual” status. But, a survey by Capgemini Consulting found that most CPOs and senior supply chain leaders are feeling rather optimistic –about both an economic rebound and procurement’s future function.

Well more than half (65 percent) of those polled in the Global Chief Procurement Officer Survey 2010 said that the economy is showing clear signs of recovery.  In addition, 60 percent confirmed that the procurement function has emerged from the global economic downturn as a winner, with an improved image within their organization.

Despite this optimism, however, significant questions remain. Is procurement’s “improved image” solely dependent on procurement’s ability to focus on cost reduction? Shouldn’t procurement also be contributing to value and innovation?

The survey found that cost reduction continues to be a major focus area with savings targets increasing as they did in 2009. In fact, more than 40 percent of those polled said they have savings targets at nearly 10 percent for 2010.

But – and here’s where there’s a disconnect –the report also reveals that the vast majority (80 percent) of survey participants reported that top management expects them to improve the overall value contribution of procurement.

Obviously, procurement needs to refine its role as a contributor to long-term business value. The cost-cutting that helped organizations weather the recession must mature into a more robust approach that integrates the supply chain into the overall business strategy.

From the report: (more…)

Today’s CFO wears many hats.

According to new research from Accenture, most senior finance executives now have an expanded scope of responsibilities, with finance overseeing programs in other departments across the enterprise.

The departments where senior finance executives most frequently said they also now manage projects include: information technology (43 percent), strategy and business development (41 percent), and human resources (39 percent). They also mentioned having program responsibilities in risk and customer service (37 percent each), procurement (35 percent), marketing and sales (33 percent), research and development (30 percent), and supply chain management (25 percent).

Accenture’s survey of more than 1,000 senior finance executives across Asia, Europe and North and South America also found that increased operational flexibility is an emerging priority. More than three-fourths (79 percent) of those polled want more flexibility in their operations to more readily respond to ongoing market changes. More than half (58 percent) said this increased flexibility would be needed across their operations for the next six to 18 months. 22 percent of the executives said they would require greater flexibility in their finance operations for a longer period of time — 18 months or more.  Fewer than one out of four (22 percent) said greater flexibility would be necessary for less than six months.

In addition, 78 percent said flexibility is needed in their planning and forecasting, rather than the traditional annual process. More than half also said they needed greater flexibility in their cost management (61 percent), transaction processing (60 percent), cash management (58 percent), performance reporting (58 percent), capital expenditure management (56 percent) and asset management (54 percent).

The new research also found that:
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