Originally appeared on Accounting Today, January 28, 2021
To succeed in today’s disrupted business environment, finance teams need to consider all of their untapped sources of value. Thriving in highly changeable market conditions means finding new ways of operating.
When uncertainty reigns, flexibility and responsiveness are vital. That makes maximizing working capital a top priority. Businesses need to ensure they have as much cash on hand as possible to fund day-to-day business operations like buying raw materials and services, meeting payroll — even paying the electricity bill.
But improving liquidity isn’t as easy as it sounds. Sustaining consistent cash flow to offset expenses and support strategic investments is vital for healthy operations. Even in regular times, however, common organizational challenges can get in the way.