When things get tough, finance officers always hit the cash card hard. Build the war chest, ride out the storm, and keep a stash of chips in the top right drawer. The pandemic proved one thing...notwithstanding the bull market leading into the health crisis, having fat on your balance sheet is not to be admired. Many firms cut costs quickly to preserve cash at the start of the pandemic.
Imagine if the balance sheet was tighter? It takes quarters to improve the working capital cycle. Doing more on this front in good times is far better than taking tough painful actions in a down period. Now more than ever, it is better to automate, goal seek, and drive working capital improvement in the best of times...not when you have to take emergency actions.
