Projections under pressure

But you don’t have a crystal ball, and decisions in today’s environment don't come with complete data or the luxury of time. Perfection is impossible. Instead, the focus needs to shift to forming a clear, defensible view with the information available, supporting the business to make defensible decisions as the situation unfolds.

In this insight, we set out what to prioritise in the immediate aftermath of an unexpected event, key considerations over the following days to weeks, and the longer-term steps CFOs can take to be better prepared for the next one.

The first 24 hours: four non-negotiables

It’s 8am. You have just been briefed on a major event: a key client is in distress, a policy change has landed unexpectedly, or a conflict has erupted.

Your Board wants to know next steps, now. What do you do?

The first 24 hours aren’t about providing a perfect answer; they’re about understanding what happened, what needs to happen next, and agreeing on a clear direction. 

1. Cash is king 

The first question to answer in a crisis will always be the same: what is the immediate and near-term cash impact? 

Prioritise establishing a clear position of what cash is exposed and what receipts or outflows, if any, are at risk. Try to estimate the potential worst-case scenario impact on your cash flows, liquidity, and banking covenants. This will inform the speed of response required and the next steps to take.

2. Manage expectations early

Early conversations with the C-suite, budget holders, board and (if relevant) shareholders will be key to instilling confidence and preventing fragmented responses. Make sure all relevant functional leaders are included and push back early on any assumptions that this is a problem Finance can address in a silo.

Expectations may also need to be managed with customers, suppliers, your bank, or other key stakeholders. While you won’t own every conversation, you will be looked to to articulate the financial impact clearly so that the right response can be shaped.

3. Prioritise pace over perfection

Your Board doesn’t need a ‘perfect number’ right now. They need clarity on the exposure, plausible outcomes, and the immediate decisions or trade-offs required as a result. Speed and clear communication matter more than precision.

As the CFO, you know this. But is it clearly understood by your team? Are expectations clear on timelines and what ‘good enough’ looks like under time pressure?

4. Don’t panic under pressure

Reacting too slowly creates risk – but so does reacting too quickly to information that is unclear, unreliable, or likely to change again within hours.

In some cases, your role might be to push back on the pressure for immediacy until decisions can be grounded in clear signals.

Beyond the initial response: three scenarios

Once the initial panic has subsided, your focus can shift to more detailed analysis to validate – or challenge – your initial instincts, enabling the Board to take well-informed, timely decisions.

Scenario 1: A key customer is impacted overnight

The situation: A major customer suspends payments or shows clear signs of financial distress following disruption in a critical operating region, putting a significant share of your revenue at risk.

This scenario often exposes concentration risk that is well understood conceptually across the business but hasn’t been modelled. Forecasts often assume continuity because customer relationships have historically been stable. 

Start with the worst-case scenario 

Before any forecast revision, pull the precise AR balance, unbilled revenue, and contracted forward orders. The cash position is the immediate concern; the P&L impact should come second. Identify the floor first.

Run the 13-week view assuming no further payments from this client from today. That worst-case floor needs to go to the Board as soon as possible.

Don’t assume recovery

In this context, recovery timelines are often uncertain. Payment delays could turn into non recovery. The customer’s operations may not resume quickly, if at all.  

Focus on three core scenarios – short-term disruption, prolonged disruption and full loss. For each, quantify the impact on cash, profitability, and liquidity headroom.

Questions to ask yourself now:

• Are forecasts built on underlying commercial drivers (contracts, volumes, payment terms), or only on trend-based assumptions?
• Have we stress-tested a ‘no cash inflow’ scenario for key customers over a 13-week horizon? Are contingency actions already defined (cost management, funding, customer diversification), or would they be reactive in a crisis?
• If our largest customer stopped paying today, how quickly would we be able to quantify the full cash exposure?

Scenario 2: A macro event hits your business directly

The situation: A wave of tariffs is introduced in a market you operate in, which will drive an increase in your cost base and put significant pressure on margins.

Early on, your priority will be to update the key drivers:

• cost assumptions linked to affected regions
• tariff exposure across your operations
• any existing mitigation (for example, pricing structures or contractual protections).

You will then need to assess how this will flow through your business. Unlike a single customer loss, where the impact is significant but relatively clear, the knock-on impacts of this shift could be wide-ranging.

You may need to adjust pricing in impacted markets, reassess demand sensitivity, and revisit cost structures or planned investments. 

Assess the immediacy

An announcement has been made, but the policy might not come into effect immediately. Even if it does, the financial impact will likely phase in - existing contracts, pricing agreements, and operational lag can still delay full exposure.

Support the business to distinguish between what the impact is right now and what could build over time.

Bring in the right experts

Finance should be in the room early, but not alone. 

Procurement, legal, commercial, and operational teams will all have critical insight into how tariffs could impact the business in practice and which scenarios need to be tested. You may need the support of an external economic or policy adviser to interpret the impact. 

Questions to ask yourself now:

• Could you quantify the impact of a sudden increase in input costs on margins and cash within hours, without needing to make significant changes to your model?
• Do you have a clear map of the stakeholders you might need to convene in a crisis, and confidence they can be brought together quickly to respond?
• Are your cost drivers explicitly modelled, so you can isolate and adjust them at speed when conditions change?

Scenario 3: An internal decision under external pressure

The situation: Market pressure leads your board to consider a discounting strategy to protect volume. There’s significant pressure to make the decision quickly to avoid losing market share that may be difficult to recover.

Start with the trade-off, not just the upside

Discounting may protect or boost volume, but it will immediately compress margins. Quantify both sides:

• the uplift required in volume to offset the price reduction
• the impact on contribution margin and cash
• the sensitivity if volumes don’t respond as expected

If the volume response needed to break even is higher than assumed, that needs to be made clear upfront.

Model behaviour, not just pricing

The risk isn’t just the short-term financial implications of the discount; it’s how customers and competitors could respond long term. Temporary pricing changes could reset expectations, trigger competitive reactions, or shift your positioning in the market.

Plan for multiple scenarios:

• limited uptake (margin loss plus no volume recovery)
• short-term uplift followed by drop-off
• sustained pricing pressure across the market.

Questions to ask yourself now:

• Are you confident that Finance is involved early enough to shape urgent internal decisions, not just asked to validate them?
• Are the key assumptions underpinning internal decisions always visible and transparent – and do you feel they receive sufficient challenge?

Building a long-term decision-making engine

The strongest CFOs do not wait for a shock to find out whether their forecasts can support fast, effective decision-making. They build the capability in advance: clear drivers, relevant KPIs, accountable assumption owners, rapid scenario testing, robust challenge, and a team that can translate outputs into action.

There are five core questions to reflect on now so you can make no-regrets decisions under pressure later.

1. Do you understand the drivers behind your revenue, cost and cash assumptions?

Your forecast model should reflect the true commercial mechanics of your business – not just where revenue comes from, but how it is priced, delivered, and collected, and what external factors those assumptions depend on.

If you understand what really drives costs, you’ll be in a far stronger position to respond at speed when conditions change overnight. For example, a spike in oil prices will probably increase distribution costs. With a driver-based model, you will be able to almost immediately assess that impact and understand how long you could absorb it.

If those drivers are not explicitly modelled now, your team will be forced to build that understanding under pressure later.

2. Have you built your response before you need it?

The worst time to figure out what to do in a crisis is once one has already hit.

That means having clear governance and crisis response plans documented in advance – with defined roles for who to convene, who updates the model, and who communicates with the Board or shareholders.

It also means putting the right tools in place in advance to enable more flexible scenario planning.  If those are ready ahead of time, you can test assumptions quickly and meaningfully when a crisis hits, supporting more focused and impactful early-stage discussions with the board and your leadership team.

3. Will your KPIs tell you early enough if strategy is at risk?

Many businesses have KPIs that track performance, but in a shock event the more important question is whether those KPIs are clearly aligned to the organisation’s strategic objectives – and whether they will show quickly enough when those objectives are at risk.

If your strategy is focused on growth, for example, you need to understand what type of growth matters most: revenue, margin, customer numbers, cash generation, geographic expansion, or something else. When external conditions shift, those KPIs should help you identify which part of the strategy is under pressure and where management action is needed first.

We often see KPIs that are too broad, too backward-looking, or not clearly linked to the assumptions in the forecast. The result is that while a business may be able to model a range of scenarios, it may still struggle to explain what they mean for strategic delivery. In a crisis, KPIs should act as an early warning system that help the CFO move quickly from “what has changed?” to “what does this mean for the business?” and “what do we need to do now?”

4. Do you know who owns the assumptions you will need under pressure?

Even the most sophisticated model won’t help without the right inputs, and those inputs don’t sit solely with Finance.

Forecasting should be a deliberate, rigorous and collaborative process, where assumptions are challenged in detail and there is a clear understanding of how everything connects. This requires continuous dialogue with functional leaders, not just periodic data collection.

Where relationships across the C-suite aren’t strong enough, forecasting inevitably becomes reactive and backward-looking. Where they are strong, risks surface earlier, assumptions stay current, and the forecast reflects reality far more closely – resulting in fewer unexpected surprises.

5. Can your team turn forecast outputs into clear decisions?

Yes, you need people in your team who can update models and run scenarios. However, infinite technical talent alone doesn’t equal better insight. Forecasting too often stops at the “what”: the numbers, the variances, the outputs. The value comes from translating those outputs into insight, and then into clear recommended actions.

As the CFO, you probably offer the latter two yourself. But you shouldn’t be the only one who can interpret, challenge, and advise the business when a crisis hits; that ability needs to be built in across your finance function.

Without that shift, even the most advanced forecasting engine risks becoming a theoretical exercise, rather than a driver of better, faster decision-making across the business.