The CFO MonitorEdge Report

CFOs Leverage Third-Party Expertise to Navigate Economic Uncertainty


December 2024 As traditional methods yield diminishing returns, CFOs are embracing advanced technology and third-party partnerships to drive innovation and manage uncertainty.

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    CFOs of middle-market companies have been increasingly confronted by a growing array of uncertainties in 2024, ranging from macroeconomic conditions to specific business challenges. PYMNTS Intelligence finds that CFOs’ chief concerns center around achieving growth and maintaining profitability. Despite a drop in optimism about overcoming these challenges, CFOs appear to feel more hopeful following the 2024 election. Yet, uncertainty remains, making it necessary for CFOs to continue to think strategically as they move into 2025.

    For a recent CFO Certainty Project report, PYMNTS Intelligence surveyed 60 CFOs from middle-market companies generating annual revenues ranging from $100 million to $1 billion to find out how these executives are responding to and managing economic pressures. The findings provide a nuanced outlook on future business uncertainty. They also reveal a shift toward more proactive measures and an increasing reliance on third-party partnerships.

    CFOs Wax More Optimistic

    There is no doubt that economic turbulence has exacerbated CFOs’ sense of uncertainty. Nonetheless, many remain optimistic regarding the level of uncertainty in the next year. In August, 51% of CFOs anticipated improvements in uncertainty over the next year, down from 65% in May. Notably, CFOs in highly uncertain environments remain the most optimistic about the future, with 63% anticipating better conditions.

    Surprisingly, the most significant drop in optimism came from CFOs currently operating under low levels of uncertainty. As of August, just 46% of these CFOs expected conditions to improve. This represents a significant drop from the 63% who said the same in May. This tempered outlook reflects shifting macroeconomic conditions and challenges in predicting business dynamics.

    Meanwhile, CFOs have expressed relief that the U.S. has moved beyond the uncertainty of the 2024 elections and, as a result, forecast an increase in business and market certainty. These are the findings of the most recent StrategicCFO360 CFO Confidence Index, conducted from Nov. 6 to Nov. 9. Among the 119 CFOs participating in the survey, 58% say they expect business conditions to improve over the coming year, up from 49% in Q3 2024.

    Even so, middle-market CFOs are bracing for continued volatility, reevaluating current strategies and exploring innovative approaches to achieve resilience.

    Increasing Proactivity to Mitigate Uncertainty

    CFOs reported a marked increase in taking proactive measures to address uncertainty in August compared to earlier in the year. As of August, respondents reported an average of five strategic actions taken in the prior 30 days. This represents a sharp rise from the three strategic actions reported in May. These efforts reflect the growing pressure to stabilize workflows and operations amid unpredictable macroeconomic conditions.

    In August, 70% of CFOs introduced new processes and workflows. They were about 50% more likely to report having done so than they were in May. CFOs were also significantly more likely to cite hiring people with specific skill sets, at 68%, and training existing personnel, at 50%, compared to May. This reflects CFOs’ commitments to refining internal operations to mitigate uncertainty.

    External solutions also gained prominence, with CFOs reporting increased reliance on third-party solutions or organizations. For example, 55% of CFOs report buying or upgrading software or platforms from third-party solution providers. In addition, 53% cite partnerships with third-party organizations. These shifts — more than double the shares relative to May — suggest that CFOs increasingly recognize the value of leveraging specialized expertise and technologies to navigate uncertainty.

    Driving Growth With Third-Party Partnerships

    Even as CFOs have ramped up their initiatives to mitigate uncertainty, the reported effectiveness of most strategies declined. Training existing personnel and hiring individuals with specific skill sets, while widely adopted, yielded diminishing returns in delivering certainty. Similarly, investments in analytics and collecting data saw varied success rates.

    Not all is doom and gloom, however. Some strategies saw increased reports of their effectiveness. Introducing new processes and workflows, at 92%, along with developing or upgrading internally developed software or platforms, at 100%, top the list of successful strategies.

    Partnering with third-party organizations also stands out. Not only did these collaborations increase in adoption frequency, but their success rate in alleviating uncertainty also improved. These trends highlight the integral role collaborations have in CFO playbooks.

    While diversification of tactics remains critical, over-reliance on traditional measures has led to diminishing returns. This signals a growing need for high-impact collaborations and advanced technological adoption to help middle-market CFOs mitigate uncertainty.

    An Insider on How CFOs Can Navigate Uncertainty

    Dean Leavitt

    In today’s rapidly evolving landscape, CFOs who fail to embrace automation and process improvement do so at their own peril.”

    Dean M. Leavitt
    Founder & CEO

     

    In an increasingly volatile economic and geopolitical environment, CFOs are focused on leveraging technology and third-party partnerships to mitigate uncertainty. Following the 2024 presidential election, the possibility of new, business-friendly policies offers a degree of optimism, yet broader uncertainties persist.

    “The election answered one key question, but uncertainty remains,” notes Dean M. Leavitt, founder and CEO of Boost Payment Solutions. “Post-election, there’s potential for business-friendly policies, such as streamlined regulations or a focus on domestic energy production, which could create a more predictable environment. However, significant geopolitical and macroeconomic dynamics — such as proposed tariffs, fluctuating oil prices, interest rates, supply chain disruptions and ongoing global conflicts — will persist.”

    Leavitt stresses the need for proactive, multifaceted planning to mitigate uncertainty in this volatile environment. “Hope is not a strategy,” he says. CFOs “need plan A, plan B, but also plan C.” He underscores the importance of assembling skilled advisory teams to leverage diverse perspectives. These teams can enable CFOs to anticipate risks and identify opportunities. He also highlights the critical nature of timely decision-making, warning that “waiting too long to act can magnify challenges.”

    Leavitt also points to automation and process improvement as a vital strategy for managing uncertainty. “In today’s rapidly evolving landscape, CFOs who fail to embrace automation do so at their own peril,” he warns. By adopting end-to-end digitization in B2B payments, for instance, organizations can enhance efficiency, reduce manual efforts and strengthen security. Such innovations, he adds, “not only reduce uncertainty but also position businesses for sustainable growth in an increasingly complex world.”

    And finally, Leavitt underscores the need for agility in today’s business climate. “Ultimately, the ability to adapt quickly, think strategically and execute decisively is what enables CFOs to weather uncertainty effectively and seize opportunities that may present themselves,” he says.

    Read More

    For more insights, dig into PYMNTS Intelligence’s studies and Trackers®. Continue reading to discover why CFOs want virtual cards in their toolkits, how CFOs envision the role of GenAI in finance and how CFOs fight uncertainty using instant payments.

    About

    Boost Payment Solutions is the global leader in B2B payments with a technology platform that is purpose-built to meet the complex demands of today's commercial trading partners. Our proprietary technology solutions bridge the needs of buyers and suppliers around the world, eliminating friction and delivering process efficiency, payment security, data insights and revenue optimization. Boost was founded in 2009 and operates in 180+ countries.

    PYMNTS INTELLIGENCE

    PYMNTS Intelligence is a leading global data and analytics platform that uses proprietary data and methods to provide actionable insights on what’s now and what’s next in payments, commerce and the digital economy. Its team of data scientists include leading economists, econometricians, survey experts, financial analysts and marketing scientists with deep experience in the application of data to the issues that define the future of the digital transformation of the global economy. This multilingual team has conducted original data collection and analysis in more than three dozen global markets for some of the world’s leading publicly traded and privately held firms.

    The PYMNTS Intelligence team that produced this report:
    Managing Director: Aitor Ortiz
    SVP, Data Products: Yvonni Markaki, PhD
    Senior Writer: Margot Suydam
    Senior Content Editor: Alexandra Redmond
    Content Editor: Matthew Koslowski


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