The impact of coronavirus on the finance function - one year on

11 May 2021

Last year, we considered the challenges faced by internal finance functions in supporting their organisations during the early stages of the pandemic. We identified the need not only to reactivate the function, helping to steer the business through the worst of the lockdown, but also to reimagine how finance teams might operate differently in a future, post-pandemic world. 

A year on

Nearly a year on, the picture is one of cautious optimism. Working capital is still at a premium and key business sectors such as hospitality, leisure and travel are not yet out of the woods. However, the trend seems to be about finance teams upskilling themselves, future-proofing their roles while organisational structures become flatter and more flexible with greater autonomy for individuals.

Rather than outsourcing, surveys have identified a desire to upskill into much needed areas of expertise. Outsourcing appears to be either relieving the pressure on short-staffed teams or managing the day to day transaction processing and regular management reporting using reliable processes and readily accessible cloud-based platforms. 

Outsourcing providers have responded to the need for flexibility to accommodate the peaks and troughs, with agility and collaboration replacing the traditional metric-driven, formulaic models of governance. 

As for the challenges of far-shore working, the industry is putting its house in order with a focus on futuristic workforce strategies, acceleration of robotic technologies and by transforming into innovation hubs.

This division of labour between internal and external finance teams seems logical. Armed with business-critical knowledge, the internal finance team is best placed to manage corporate risk, produce detailed cash forecasts on shorter reporting cycles, stress test product, partnership and business strategies, generate more sophisticated rolling forecasts and provide business planning and recovery support through streamlined budgeting processes.

From an organisational perspective, many finance team members are ready to embrace hybrid working. Shifts in organisational working patterns may also have wider ramifications for finance teams. A McKinsey survey pointed to the reduction in large-scale meetings in favour of smaller working groups or 'councils' to accelerate the speed of decision making. Shared services are increasingly favouring distributed ownership models, while devolved management and flatter, more autonomous team structures are likely to become the new normal. 

Rigid adherence to standardised financial practices may be replaced by more agile working patterns that can respond to future disruptive events. 

Investment in new technology is not yet high on the agenda for finance teams. It may be considered too risky, with on-going concerns about the governance issues of artificial intelligence taking technology down a slower path. However, investment in cloud-based systems is expected to grow by 47 per cent with the long-term trend suggesting that Finance IT will be largely cloud-native by 2025. The long-term prize of a future-proofed finance function is undoubtedly still a worthy goal, with 43 per cent of 'transformed' finance functions reporting no pandemic disruption at all. 

While the reimagined world of technology may not yet be fully in place for the finance team, a survey of 1,000 UK CFOs highlighted the adoption of smaller, technology solutions with cash management and forecasting software topping the list. Perhaps this is the result of finance team members looking not only to upskill in business-critical areas, but also seeking the best tools to help them in that process?

Change is coming

Change is ahead for finance teams emerging from the pandemic. Many finance-centric activities that proved critical during lockdown are becoming mainstream, requiring finance teams to upskill themselves and find relevant technology to gain greater insight. With internal resource at a premium, it may increasingly fall to agile and flexible third-party providers to bridge the gap. 

For more information on how outsourcing your finance function can help your business, please contact

Ian Sadler Ian Sadler