Uncertainty has become the new normal. Supply-chain shifts, higher financing costs, and client payment delays are testing even the most resilient finance teams.
For CFOs, strong revenue isn’t enough, liquidity discipline is what keeps companies alive when volatility strikes.
A 2025 EY survey found that 64 % of CFOs list liquidity management among their top three priorities, and only 28 % achieve cash-flow forecasts within 10 % of accuracy over a twelve-month horizon.
JPMorgan’s 2025 Middle-Market Outlook shows that 63 % of firms plan to expand credit lines this year to guard against cash-flow shocks.
“Cash flow discipline isn’t defensive — it’s the engine that funds growth,” says Brian, CFO Worx CEO.
“When visibility is weak, growth turns into risk. When liquidity is managed proactively, opportunity opens up.”
Why Liquidity Discipline Matters Now
Higher interest rates and project volatility are forcing CFOs- especially in IT services, construction, and contracting- to rethink working-capital habits.
Thin margins mean one delayed invoice or mis-timed purchase can erase profitability.
Liquidity control ensures you have time to react, not just numbers to explain.
Build a Real-Time View of Cash
Many finance teams still rely on monthly or quarterly snapshots. In today’s environment, that’s too slow.
Modern CFOs are shifting to rolling 13-week cash-flow forecasts that capture near-term risks and opportunities.
Best practices include:
- Daily cash dashboards integrating bank feeds and project billing.
- Automated variance alerts when inflows or outflows deviate from plan.
- Linking cash forecasts to operational data– backlog, headcount, and material costs.
Research from the Construction Financial Management Association shows companies with integrated finance-operations data achieve 20 – 25 % faster month-end closes and fewer compliance issues.
“When systems and cash forecasts speak the same language, you stop chasing numbers and start steering liquidity,” Brian notes.
Tighten Working-Capital Levers
Liquidity gains often come from fundamentals, not financing.
CFOs can unlock cash trapped in operations by:
- Optimizing receivables. Shorten invoice cycles with milestone billing, digital payment links, and proactive collection triggers.
- Rationalizing payables. Negotiate vendor terms strategically- extend where possible, but protect key relationships.
- Managing inventory and WIP. For project-based businesses, align procurement with confirmed schedules to avoid idle stock.
- Implementing a cash-conversion KPI. Track days sales outstanding (DSO), days payables outstanding (DPO), and days inventory outstanding (DIO) together to monitor liquidity efficiency.
McKinsey research shows that companies reducing their cash-conversion cycle by 5 days free up 3 – 5 % of revenue in working capital– funds that can be reinvested in growth.
Stress-Test Scenarios Before They Happen
Scenario planning separates proactive finance teams from reactive ones.
Run best-, base-, and worst-case cash scenarios that include delayed collections, project overruns, or rate changes.
Use these models to guide hiring, capital expenditures, and debt levels.
According to BDO’s 2025 CFO Outlook, 42 % of mid-market CFOs now run monthly scenario analyses compared to 27 % two years ago– evidence that liquidity forecasting is becoming a strategic function, not just an accounting task.
Leverage Smart Financing – Without Overleveraging
Debt markets are shifting again as rates stabilize.
CFOs should cultivate relationships with multiple lenders, monitor covenant headroom, and maintain audit-ready financials even when not seeking funding.
“The best time to raise credit is before you need it,” Brian explains.
“Credibility with lenders comes from transparency and discipline — not urgency.”
Use short-term lines for working-capital smoothing and long-term instruments for asset growth. Always align financing structure with cash-flow predictability, not headline rates.
Turn Cash Discipline into Culture
Liquidity management isn’t only a finance function, it’s an organizational habit.
When project managers, procurement leads, and executives understand cash-flow impact, decision-making improves.
Create simple reporting dashboards visible to all budget owners, celebrate improved DSO metrics, and tie cash-conversion KPIs to performance bonuses.
A culture of liquidity awareness builds agility across the business.
The CFO Worx Perspective
At CFO Worx, we see high-performing mid-market firms treating cash-flow discipline as a growth strategy. They forecast weekly, reconcile daily, and communicate relentlessly- turning uncertainty into control.
“Liquidity gives you options,” Brian says.
“And options are what separate companies that endure from those that react.”
Need to strengthen your cash-flow visibility or working-capital control?
CFO Worx provides CFO, accounting, and bookkeeping services that bring clarity, forecasting precision, and liquidity strategy to growth-stage firms.
Content Disclaimer: The information shared in CFO Worx Insights is for general informational purposes only and should not be considered professional, legal, accounting, or tax advice. Each company’s situation is unique, and readers should consult qualified advisors before making business or financial decisions.