There’s no better time for CFOs to take a step back and reflect on the lessons of the past year.
The first lesson: cash is always king. Throughout 2007, we reported on how companies boosted their cash flow and carefully put stockpiles to work. This discipline paid off for many, especially when it came to mergers and acquisitions, the subject of “Crisis, What Crisis?,” our annual dealmaking review.
Despite tighter credit conditions, we found that it’s not all doom and gloom, particularly for non-financial-services companies that are profitable and cash-rich. Many of these firms spent the first half of the year, before the summer’s credit crunch, resisting pressure to join the private-equity fuelled M&A frenzy or launch massive share buyback programmes. As they now reap the rewards, the wisdom of not following the crowd looks wiser than ever — that’s another important lesson.
Our cover story, “The Right Role,” deals with this second lesson, but on a personal level. Over the summer and autumn, we shadowed four finance professionals — two senior executives and two up-and-comers — searching for new jobs. What’s striking is the clear-headed determination of each to find a new job that meets a stringent set of personal criteria. It wasn’t always easy — amid all the interviews, sending out of CVs and networking, there were many moments of doubt and pressure to settle for traditional, but potentially less fulfilling, roles. But, as we report, their persistence paid off.
For CFOs making New Year resolutions, it’d be wise to heed the varied lessons for finance in 2007. Both you and your company will be glad that you did.