A recent Gartner survey also finds on-premise technology spending is being deferred and credit lines are being drawn down as a precaution.
Seventy-four percent of CFOs and finance leaders said they will move at least 5% of their previously on-site workforce to permanently remote positions post-COVID 19, according to a Gartner survey at the end of March. The survey of 317 executives found that this measure may help organizations control costs.
"This data is an example of the lasting impact the current coronavirus crisis will have on the way companies do business," said Alexander Bant, practice vice president, research for the Gartner Finance Practice, in a statement.
"CFOs, already under pressure to tightly manage costs, clearly sense an opportunity to realize the cost benefits of a remote workforce," Bant said. "In fact, nearly a quarter of respondents said they would move at least 20% of their on-site employees to permanent remote positions."
SEE: Coronavirus to cause deep cuts in IT spending this year, according to IDC (TechRepublic)
With 81% of CFOs previously telling Gartner that they planned to exceed their contractual obligations to hourly workers, remote work is one example of "creative cost savings" measures senior finance leaders are planning to avoid more severe cuts and minimize the downside impact to operations, the firm said.
Adjusting to more flexible work schedules and providing company-issued work from home equipment are other steps CFOs previously reported to Gartner that they were taking to support employees. These actions by finance leaders help minimize disruptions workers might be facing as a result of the crisis, the firm said.
"Most CFOs recognize that technology and society has evolved to make remote work more viable for a wider variety of positions than ever before," Bant said. "Within the finance function itself, 90% of CFOs previously reported to us that they expect minimal disruptions to their accounting close process, with almost all activities able to be executed off-site."
As organizations continue to grapple with the business disruptions from COVID-19, permanent remote work could complement other cost-cutting measures that CFOs have already taken or plan to take, Gartner said.
Other actions CFOs are taking
In Gartner's most recent survey, 20% of respondents indicated they have deferred on-premise technology spending, with an additional 12% planning to do so. An additional 13% of respondents noted they had already made cost reductions in real estate expenses, with another 9% planning to take actions in this area in the coming months, the survey found.
This week, in a follow-up on CFO actions in response to COVID-19, Gartner said cash flow concerns continue to grow. A majority (65%) of CFOs reported they are drawing down credit lines before they need it, as a precaution. Gartner also found that other actions CFOs are taking include proactively and transparently approaching banks to discuss risks of covenant default.
"One CFO was pleasantly surprised that the bank's response was, 'If you give us a heads-up early, we're happy to give you a waiver,'" the firm said.
CFOs are also requesting data from banks on the progression of macroeconomic conditions where the pandemic is further along, according to Gartner. "CFOs are using this information to identify leading indicators (e.g., customer default rates) they should track, and to estimate impacts on customers to inform liquidity planning," the firm said.
CFOs are also scheduling one-on-one meetings with board members who have different backgrounds "to cover blind spots and ensure the CFO is not missing anything critical," Gartner said.
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