The Leadership Advantage in Cash Flow
Discover how effective working capital management can boost your company’s financial health, operational efficiency, and competitive edge.
A robust working capital management strategy is crucial for maintaining a company’s financial health and operational efficiency. Effective management of working capital is the difference between financial resilience and vulnerability. A strong strategy distinguishes companies that can navigate market uncertainties, seize growth opportunities, and boost stakeholder confidence from those that struggle with liquidity issues and missed opportunities.
Analysts frequently reference working capital metrics because they provide critical insights into a company's operational efficiency, liquidity, and overall financial health. Over the past five years, as net working capital days have increased, discussions around working capital during earnings calls have also risen. This trend highlights the growing importance of working capital management for financial stability and shareholder value.
Key Considerations:
- Transparency and Accountability: Improve working capital management by aligning teams such as sales and procurement with the organization’s cash flow and liquidity objectives.
- Establishing Metrics: Linking rewards to working capital-related KPIs can help align team efforts toward improving financial health.
- Enterprise Cash Management: Proactively establish a dedicated leader to bridge gaps between teams and optimize working capital.
Learn how you can transform the public narrative from concern to confidence by optimizing your working capital management practices.
Dive into our thinking:
Sign-up to receive Performance Improvement insights
Stay ahead with insights and actionable strategies designed to elevate your business performance across your organization.
Meet our team
How can KPMG help you realize value?
KPMG's goal is to help you through your transformation or crisis so you can focus on delivering on your business objectives. Find out how KPMG firms use our global expertise, a multidisciplinary approach and wide-ranging experience to support your organization.
