Early indicators suggest that the outlook for the economy in 2023, whilst in recession, could be better than was expected at the end of last year, with energy prices, the cost of wholesale foods and inflation all showing more favorable trajectories (this could all change of course, but good news for now). To the extent these trends are sustained, certain parts of the economy could benefit sooner than others, but the road ahead is a long one – not least, as this article highlights, because 40% of CEOs don’t see their current business model as being viable 10 years from now.

Where then, should Boards be focusing their attention this year? Fighting the fire of the moment, shoring up the balance sheet, planning the next technology or embracing innovation and disruption? The answer, often, is that they all need attention and for one key reason – the need to future proof the business, whether against a near term shock or broader systemic changes further down the line. Future proofing (or building resilience) isn’t just confined to the private sector either, it is equally applicable to the public sector and third sector – whether NHS hospitals, local authorities, housing associations or charities.

For CFOs, "future proofing" on a day to day basis could mean a number of things: frequent reforecasting, cost rationalisation, optimising cash management, asset disposals (or strategic acquisitions), recutting capex plans, raising/ refinancing debt or plugging key gaps in resourcing. However, one topic that has regularly come up in the discussions I have had lately is supply chains, an area which is often over looked (this article also references it). It made me wonder, what proportion of organisations really understand their supply chains and the risk of supplier failure somewhere within it? Not only that, but how do they monitor their supplier base, where do the risks sit and what contingency plans do they have should part of it collapse? After all, with many SMEs struggling to raise the finance they desperately need in the current climate and December’s data showing a striking rise in corporate insolvencies, corporate failure in the supply chain could come without warning and with severe consequences.

Fortunately, with enough time and planning there's a lot that can be done to get a better understanding of the issues in the supply chain and building resilience more broadly.