Executives can focus on strengthening the cash culture across their organizations, changing underlying systems and mindsets, and implementing no-regrets moves to embed cash excellence into ongoing operations. Now, several months into the crisis, executives have a rare window of opportunity to build the current focus on cash into long-term cash excellence. In extraordinary times, extra cash can prevent a company from going bankrupt. ![]() One silver lining to the crisis is that it revealed the critical importance of cash excellence-a set of best practices that enable prudent cash and liquidity management. Governments responded by setting up large stimulus programs that included measures to improve companies’ liquidity and cash flows-for example, postponing the collection of government-related fees. As the economic fallout from the pandemic hit their balance sheets, many companies quickly took drastic measures to preserve cash, such as significant cuts on capital expenditure, dividend cuts, reductions in external spending, and temporary plant closures. Some industries were hit harder by the pandemic than others: aerospace, travel, oil and gas, and retail experienced a sharp drop in demand for their services and products, as well as restrictions on their operations. The liquidity crisis triggered by the sharp disruption in economic activities prompted organizations to rush toward cash and liquidity to keep operations going. When the COVID-19 crisis began to affect companies worldwide, the preliminary response of CEOs and CFOs was all about survival: freeing up cash and resources to keep the lights on and the doors open.
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