Navigating risk in turbulent times

Uncertainty among CFOs rose more than any other concern during the first quarter even as their optimism in the economy edged up compared with last quarter, the Federal Reserve Banks of Richmond and Atlanta said Wednesday, citing a survey.

Tariffs and trade policy led the list of concerns among CFOs during Q1, followed by labor quality/availability and demand/sales/revenue. While fourth on the list, uncertainty was the only major concern that CFOs mentioned more than during Q4 2025, according to a survey conducted with Duke University’s Fuqua School of Business from Feb. 17 to March 5.

“Most firms expected demand to increase in the next 12 months and reported continued hiring, albeit more for replacement than for new positions,” Sonya Ravindranath Waddell, a Richmond Fed vice president and economist, said in a statement. “Very few firms expected declining demand or a need to lay off workers,” she said.

The Iran war has clouded the business outlook with uncertainty since the first attacks by U.S. and Israeli warplanes on Feb. 28.

The prices of both oil and gas have surged following a seize up in supply chains for energy and other commodities linked to the Middle East.

Financial market volatility has flared this month, with the Cboe Volatility Index, or VIX, hitting the highest level since the announcement of sweeping U.S. tariffs in April 2025.

Also, the yield on the 10-year Treasury note — the benchmark for the cost of corporate and other borrowing — has jumped from 3.97% on Feb. 27 to 4.32% on Wednesday.

“The past several days have marked a notable increase in bond market volatility,” RSM U.S. Chief Economist Joe Brusuelas said in a note Wednesday.

“Investors’ concerns include an unsustainable American fiscal position, rising inflation risk and a growing uncertainty about war,” he said.

“This is part of a wider move across asset markets as the war has moved from one of short-term disruption of energy supplies to longer-term structural damage to the regional production and refining capacity,” Brusuelas said.

The Merrill Lynch Option Volatility Estimate, or MOVE Index, gauging volatility in the U.S. Treasury market has jumped above its 52-week average to levels seen during “past episodes of price instability and policy dysfunction,” he said.

The index is an early warning sign of financial market disruption, he said, adding “sharp increases like those of the past several days are a reflection of increasing uncertainty,” Brusuelas said.

The Federal Reserve on March 18 held the main interest rate steady, noting the uncertain impact on the economy from the Iran war.

Fed Chair Jerome Powell said at a post-meeting news conference that it is too early to predict whether fighting in Iran will lead to a sustained surge in the price of oil, spurring inflation in the U.S., crimping consumer spending and slowing economic growth.

Still, policymakers “continue to contend with inflation notably above the Federal Open Market Committee’s 2% goal,” Fed Governor Michael Barr said Tuesday.

“While I am hopeful that inflation will fall as the effects of tariffs on prices wane later this year, I would like to see evidence that goods and services price inflation is sustainably retreating before considering reducing the policy rate further, provided labor market conditions remain stable,” Barr said.

“Moreover, the conflict in the Middle East raises additional risks,” he said in a speech. “Higher oil prices tend to pass through pretty quickly to gasoline prices, and higher gasoline prices can be particularly painful for low- and moderate-income families.”

U.S. companies have apparently become more cautious. Growth in business activity in March slowed to an 11-month low as the Iran war pushed up prices and restrained new orders, S&P Global said Tuesday.

Service sector activity rose at the weakest pace in nearly a year, and businesses responded to higher input costs and a spike in energy prices by raising average selling prices at the fastest rate since August 2022, S&P Global said.

The steady advancement of new technologies, including artificial intelligence, is accelerating the evolution of the role of the finance chief. With the integration of automated tools into the finance function, CFOs are now acting as the CEO’s “copilot,” rather than simply as number crunchers—but in order to do so effectively as a finance leader, “you have to get your hands around data,” CHG-Meridian CFO Ulrich Bergmann said.

“Data is the key. Without data, you cannot steer,” Bergmann said. As such, a key focus of his is to “not only improve data quality, but to make sure that you have all the, I would say, the data structure and the data governance in place you need in order to steer the business,” he told CFO Dive in an interview.

Bringing data front and center

Establishing a data culture — or, in other words, creating a business-wide standard for data’s governance and structure — at CHG is “definitely a big, big challenge” Bergmann said. While the company is global, operating in over 32 countries, it’s also a family-oriented business and tends to approach its goals in an entrepreneurial style — where data processes and quality can come in third or fourth place on a priority list, he said.

Bergmann joined the Germany-based business, which helps clients develop, finance and manage their technology assets, in March 2019 as its chief representative, and took the top finance seat in March 2020, according to his LinkedIn profile. Prior to CHG-Meridian, he held a number of roles during a decades-long career at Big Four firm KPMG  — where CHG was a former client — including head of global captive finance for KPMG Deutschland.  

Shining a spotlight on data can be critical in today’s era when company leaders are steadily seeking better insights, quicker—often leaning on the CFO to provide them. As the CEO’s copilot, Bergmann and his finance team tap tools which enable rolling, rather than static forecasts: using Microsoft’s Fabric tool to bring in different data points to examine how profit has developed over the past decade, for example, with the tool then providing a “best case, real case, worst case scenario,” he said.

In tapping such tools, keeping focus on the governance aspect is crucial. It’s important that “in every country, you have data scientists, you have data experts who really look for the data quality,” Bergmann said. “You also understand the data models behind the different areas. And since we are a global company, you need, basically, at least 32 experts.”

Fostering a successful transformation

Putting a focus on data is also essential to successfully executing on long-term projects or initiatives, such as bringing new solutions into the business. CHG is currently in the process of rolling out a new ERP system across its global business, for example, a project which began three years ago.

After getting buy-in across its global entities and choosing a partner — CHG landed on SAP — the company moved into the design phase,, then into the build phase around eight months ago, and is now entering what Bergmann terms as the “marriage” phase, “where you connect the dots now between what is being designed and what is stored in our current legacy systems,” he said. The business plans to move to the rollout phase in the next nine months, which will likely span another three years.

While data is key, it’s important not to forget the human element: finding the right talent that can help to shepherd through such projects, or that have the skills to analyze and put that data to use, is another critical factor, Bergmann stressed. In assessing talent, Bergmann searches both for quality leaders, and quality managers.

Leaders are those who are open to change, “who also can transport clear messages to the team, provide stability and also trust and reliability to your team members, and so in other words, you get the buy in to the task,” he said.

Managers, meanwhile, focus on honing the individual strengths of their team members, improving processes and workflows, or in other words, ensuring that tasks can be properly executed and the tools put to successful use. Whether it’s an ERP transformation, AI or ML related, “you need to bring the two sides together in order to make the transformation and the change successful,” Bergmann said.

Sponsored content

By Avalara

Enterprise CFOs are operating in a risk environment that is evolving faster than most finance systems can keep up. Macroeconomic volatility, shifting tax policy and rapid AI adoption are converging. Even well-run organizations can face exposure through indirect tax compliance.

In many finance organizations, tax is still managed through legacy systems, manual workarounds and spreadsheets. This approach no longer aligns with how modern enterprises operate across distributed entities, omnichannel revenue streams and cross-border supply chains. For CFOs responsible for governance and earnings quality, this gap is a growing source of structural risk.

Avalara® helps address this challenge with a unified, automation- and AI-enabled platform. It embeds tax and regulatory logic into ERP, ecommerce and billing systems so compliance can run continuously at transaction scale rather than in periodic cycles.

When “good enough” compliance becomes risk

Three patterns often emerge in large, multientity organizations:

• Fragmented systems: Inconsistent tax logic across entities makes it difficult to demonstrate control or explain variances.
• Manual work at scale: Finance teams spend time reconciling returns and managing certificates instead of focusing on strategy.
• Opaque costs: Compliance costs are spread across systems, vendors and internal processes, limiting visibility.

These challenges are not just operational inefficiencies. They contribute to audit exposure, restatement risk and margin pressure. They can also slow initiatives like ERP modernization, M&A integration and market expansion.

The business case for modern tax infrastructure

To quantify the impact of automation, Avalara commissioned Forrester Consulting to conduct a Total Economic Impact™ (TEI) study on tax compliance automation.

Based on a composite organization using Avalara solutions, the study found:

• 153% ROI, with a net present value of $465,000 over three years
• Payback in under six months
• Up to 85% efficiency gains in audit preparation
• Nearly 1,000 hours saved annually across returns and exemption workflows

These results reflect the modeled organization in the study and are not a guarantee of future outcomes; results may vary.

Beyond quantified benefits, Forrester identified improvements in governance, reduced reputational risk and the ability to shift finance resources to higher-value work.

Aligning tax automation with CFO priorities

Tax automation supports three core areas CFOs prioritize:

Risk reduction

Cloud-based platforms centralize tax rules and reporting across jurisdictions. This helps reduce the likelihood of errors, missed filings, and audit exposure. Real-time tax content and automated filing workflows support stronger governance and more consistent compliance.

Productivity and operating leverage

Automation reduces manual processes like returns preparation and certificate management. This enables finance teams to focus on planning, forecasting and business partnership activities instead of repetitive compliance tasks.

Cost discipline and faster time to value

In the TEI study, reduced third-party spend, lower internal effort and fewer penalties contributed to strong ROI and rapid payback. For finance leaders balancing competing investments, faster time to value can strengthen the business case for automation.

Expanding your view of compliance risk

For organizations assessing broader compliance exposure, additional resources can help:

• Avalara tax changes 2026: Covers evolving tax policies, tariffs and digital taxation trends.
• Avalara for enterprise: Highlights global coverage, ERP integrations and architecture for complex organizations.

Avalara supports compliance across more than 190 countries and helps organizations manage regulatory change without fragmenting their infrastructure.

From operational burden to strategic capability

Modern risk management depends on infrastructure decisions: how data flows, where processes run and which activities still rely on manual effort. Indirect tax compliance is one area where legacy approaches can quietly accumulate risk until an audit or policy change exposes gaps.

For CFOs, the question is no longer whether to modernize tax compliance. It is whether the organization can continue managing a growing source of risk without the visibility, control and efficiency that automation can provide.

The Forrester TEI study offers one independently validated perspective on that shift, measured in cost savings, time reclaimed and reduced uncertainty.

The Trump administration on Friday released a cybersecurity strategy that commits the U.S. to disrupting malicious cyber threat actors, protecting critical infrastructure, harnessing the power of AI and reducing regulations on businesses.

The seven-page Cyber Strategy for America offers no details about how the government will implement the six pillars of President Donald Trump’s ambitious cybersecurity agenda. But it is suffused with rhetoric that echoes Trump’s “America First” messaging, boasting about U.S. military operations against Iran and Venezuela and threatening to wreak havoc on nations that attack the U.S. in cyberspace.

“Unlike other Administrations,” the document says, “the Trump Administration will not tinker at the edges and apply partial measures and ambiguous strategies that neglect the growing number and severity of cyber threats.”

Instead, according to the strategy, the U.S. will embrace “unprecedented coordination across government and the private sector to invest in the best technologies and continue world-class innovation, and to make the most of America’s cyber capabilities for both offensive and defensive missions.”

Deterring foreign hackers

With nation-state actors and cybercriminals increasingly disrupting U.S. companies’ operations and threatening vital infrastructure, the strategy says the U.S. must find a way to impose costs on adversaries that discourage them from targeting American networks.

The Trump administration plans to “unleash the private sector by creating incentives to identify and disrupt adversary networks and scale our national capabilities,” according to the strategy. The document calls for new efforts to stop intrusions before they compromise important systems and “erode [attackers’] capacity and capabilities.”

The document could presage an increased role for U.S. Cyber Command, the military unit that protects Defense Department networks and penetrates foreign infrastructure for espionage and disruption missions. “Our warriors in cyberspace are working everyday to ensure that anyone who would seek to harm America will pay the steepest and most terrible price,” the strategy says.

The section on countering adversaries addresses both government-backed operatives and criminal groups. “Cybercrime and intellectual property theft are some of the greatest threats to global economies,” the document says. “We will uproot criminal infrastructure and deny financial exit and safe haven.” 

As part of that effort, Trump on Friday signed an executive order focused on crippling transnational criminal organizations engaged in cybercrime.

“We will work together to create real risk for adversaries who seek to harm us,” the new strategy says, “and impose consequences on those who do act against us.”

Securing critical infrastructure

The strategy touches briefly on the importance of hardening the defenses protecting power grids, hospitals, water systems and other critical infrastructure. The Trump administration is promising to “identify, prioritize, and harden” this infrastructure, an initiative that could resemble the Cybersecurity and Infrastructure Security Agency’s “National Critical Functions” initiative during the Biden administration.

The Trump administration has dramatically downsized CISA and left its remaining workforce demoralized and rudderless, raising questions about how effectively the agency can spearhead the new strategy’s infrastructure protection pillar.

Trump has also called on states to assume more of the burden for defending the infrastructure on their soil, much to the frustration of local leaders who say they can’t afford to do that work. The new strategy appears to take a conciliatory approach to the burden-sharing issue, declaring that the federal government “will galvanize the role of state, local, Tribal, and territorial authorities as a complement to—not a substitute for—our national cybersecurity efforts.”

Easing regulations on businesses

The business community’s biggest cybersecurity-related request of the Trump administration has been to reduce regulations, and the strategy promises that the government will do just that.

“Cyber defense should not be reduced to a costly checklist that delays preparedness, action, and response,” the document says. “We will streamline cyber regulations to reduce compliance burdens, address liability, and better align regulators and industry globally.”

The Biden administration implemented new cybersecurity regulations for several critical infrastructure sectors and began enacting a congressionally required incident-reporting rule covering all sectors. But the Trump administration has delayed that rule to seek more industry feedback, and federal leaders now say they want to avoid overly burdening security professionals in the middle of incident response.

“We will remove burdensome, ineffective regulations so that our industry partners innovate quickly in emerging technologies,” the new strategy says. “Partners in the private sector must be able to respond and recover quickly to ensure continuity of the American economy.”

Leading on AI, other critical technologies

The Trump administration has described AI as one of the most important technological developments in modern history and stressed the importance of the U.S. dominating the AI market, especially amid competition with China. The strategy discusses AI’s economic and national security benefits and says the government will work with the private sector and foreign partners to nurture the success of U.S. vendors.

The government also plans to increase its use of AI for network defense, according to the document. “We will swiftly implement AI-enabled cyber tools to detect, divert, and deceive threat actors,” the strategy says, vowing to “rapidly adopt and promote agentic AI” as well.

Other new technologies receive brief mentions in the strategy, including post-quantum encryption algorithms, which the government is encouraging businesses to prepare to adopt.

“We will build secure technologies and supply chains that protect user privacy from design to deployment, including supporting the security of cryptocurrencies and blockchain technologies,” the strategy promises. “We will promote the adoption of post-quantum cryptography and secure quantum computing.”

The document also hints at the Trump administration’s intention to fight against international standards for AI that seek to limit harms such as bias and disinformation. “We will engage internationally through diplomacy, commerce, and operations to ensure norms and standards reflect our values,” the strategy says.

Promises on workforce, federal networks

The strategy also addresses two other cybersecurity issues that often receive less attention: expanding the pool of American workers qualified for cybersecurity jobs and improving the federal government’s ability to keep hackers out of its own networks.

“We need a pipeline that develops and shares talent,” the strategy says in a brief section on workforce development. “We will eliminate roadblocks that prevent industry, academia, government, and the military from aligning incentives and building a highly skilled cyber workforce.”

On the topic of securing government networks, the Trump administration vowed to “accelerate the modernization, defensibility, and resilience of federal information systems,” including by adopting post-quantum cryptography, implementing zero-trust architecture and moving more information systems to cloud platforms. In addition, the document says, “AI-powered cybersecurity solutions” will help the government “defend federal networks and deter intrusions at scale.”

CFOs and chief information security officers are significantly misaligned when it comes to cybersecurity investment goals and priorities, a survey by cybersecurity firm Expel found.

The breakdown revolves around metric and decision-making mismatches, according to the report released this month. Security leaders typically make decisions based on industry best practices, compliance requirements and ease of integration, while finance chiefs zero in on areas such as cost avoidance and risk reduction.

“Rather than doubling down on metrics that their counterparts don’t value or can’t understand, CISOs and CFOs can both benefit from educating their counterparts,” the report said. “By bridging the knowledge gap, finance and security leaders work toward better alignment, clearer communication, and more strategic cybersecurity investments.”

The findings come as escalating threats are heightening pressure on organizations to make strategic cybersecurity investments, Expel said.

Cyberattacks are expected to surge this year as criminals continue exploring ways to capitalize on advancements in artificial intelligence.

“Now, new AI-driven threat vectors stand to increase the scope, frequency and cost of data breaches,” global information services firm Experian said in its 2026 data breach forecast report.

As cyber threats become more sophisticated and the financial impact of breaches rises, CFOs are taking a more proactive role in cybersecurity strategy and investment decisions, Jack McCullough, president and founder of the CFO Leadership Council, said in a recent blog post. 

“This extends beyond just approving budgets — it involves understanding the business continuity implications and ensuring the organization is adequately protected,” he said. “Success depends on collaborating with CISOs and IT leaders to translate technical risks into business language for boards and investors, maintaining transparency about vulnerabilities and incident response capabilities, and being agile in responding to emerging threats.”

Security and finance leaders report excellent collaboration, with 74% and 68%, respectively, saying they work together early and often, according to Expel’s report. Yet the research exposed disconnects.

Security leaders said they encounter obstacles including limited understanding of cybersecurity risk when trying to obtain funding from finance. Finance leaders, meanwhile, indicated they want specific, measurable data before approving cybersecurity investments, with 40% saying that quantified risk reduction would make it easier to justify a spending hike.

More than four in 10 finance executives said better translation of technical risk into financial terms would help improve collaboration between the two teams.

To get on the same page, the teams have to learn to speak the same language, according to Expel.

“This may require security leaders to translate metrics into measurements that resonate with finance leaders,” the report said. “For example, ‘ease of integration’ might turn into a time- or cost-based metric while ‘meeting compliance requirements’ might translate into avoiding fines.”

The report was based on a survey of 136 cybersecurity leaders and 164 finance executives, Expel said.

Between the continued evolution of technologies like artificial intelligence, macroeconomic uncertainty, and new regulatory developments, CFOs consolidating their strategies for 2026 are looking forward to a year that promises to be as full of challenges and complexity as ever.

To keep pace, finance chiefs need to ensure they have a full and accurate picture of all of the risks that could potentially impact their organizations — and more importantly, they need to be able to work in tandem with their risk teams to turn that view of risk into an effective plan of action, Tina Yeh, chief accounting officer for AuditBoard, a provider of audit, risk and compliance management software.

“When you're working with your finance teams and CFOs, it's, how do you translate that to the impact on overall margins and the bottom line at the end of the day?” Yeh told CFO Dive in an interview regarding risk management strategies. “Where are the trade offs?”

New tools, new blind spots

One of the challenges Yeh has observed over her career is the “difficulty in translating risk assessments into actionable conversations and how to invest resources into that,” she said.

Yeh “grew up in audit,” she said of her career path, beginning as an assurance associate during a five-year span at Big Four firm PricewaterhouseCoopers.

From PwC, she joined workforce software provider Cornerstone on Demand, where she held a number of roles including associate director, accounting, according to her LinkedIn profile. She joined the Cerritos, Calif.-based AuditBoard eight years ago and has served as its CAO since September.

The ability to move from risk assessment into action has only grown more critical as the amount of risks that need to be assessed continues to swell. For example, introducing AI into one’s organizational processes has the potential to free up more time and resources for employees to focus on more strategic work — but the technology also comes with “new blind spots,” especially for finance functions and teams who “really don't yet have clear oversight of how AI is being used,” she said.

AI has continued to be top of mind for leadership over the past year, with finance and accounting teams mulling the best possible usage of the tool at the same time as they seek to guard against its associated risks, from siloed or unstructured data and cybersecurity troubles to the costs and challenges associated with upskilling or retraining employees on how to use it properly.

Identifying a clear strategy to utilize AI will be essential moving forward. CFOs who “think ahead and work with their risk teams on strong AI governance will be the ones that are ahead of the curve, on top of keeping compliant,” Yeh said.

To identify and open up those “blind spots,” both finance and risk leaders need to become more forward-looking in their risk management strategies, making a strong relationship between those two teams essential.

Last month, AuditBoard launched a scenario planning module aimed at addressing some of these challenges, according to a Nov. 18 press release. The module can act as a “facilitation of conversation between the risk teams and the CFOs to be able to get on the same page and speak the same language,” Yeh said.

The tool could be tapped to help organizations assess how ready they are for supply chain disruptions, for example, examining factors from potential material shortages, geopolitical events and cyberattacks to help define a risk scenario and its possible fallout, she said.

Driving the compliance to strategy shift

AuditBoard’s scenario planning module helps CFOs “gain clear visibility into the range of possibilities,” but much more critically, into their financial impact — facilitating “a much more robust conversation between risk leaders and finance,” she said.

That’s key for effective risk management, especially as the rate of change appears to be accelerating alongside the number of risks organizations need to track. The frequency of so-called “black swan” events is accelerating to the point where it’s becoming difficult to differentiate between typical challenges faced by companies, finance chiefs from companies including Hasbro and FedEx said during a panel at MIT Sloan’s CFO Summit in November.

Unlikely events are now becoming simply baked into potential strategies, ready to go when needed, Yeh said. As leaders confront more changes, more frequently, how they think about and respond to risk inside their organizations is also changing.

“We're continuing to see the evolution of risk management from being compliance driven to being a strategic tool for organizations, especially as change accelerates,” Yeh said.

Yooz CFO John Gronen has decided against offering employees instant paycheck access next year, with the decision coming after he explored the potential new benefit and determined there was not sufficient interest to move forward.

The Dallas, Texas-based accounts payable software company’s finance chief told CFO Dive in July that he was weighing the advantages, costs, and potential unintended consequences of offering the new benefit, also known as earned wage access. At the time, Gronen acknowledged personal reservations that EWA tools could lower budgeting support that he believes traditional monthly or semi-monthly paychecks provide. 

“We decided to hold off for the next year on the EWA issue. No one was that excited about it here since most are reasonably well compensated,” Gronen said in a recent emailed response to questions. “We may revisit for 2027 if things have changed in the market or if there is more demand from our current staff.” ​​​

A growing number of states have begun passing laws friendly to EWA service providers since 2023, although the industry has also sparked controversy because of fees associated with some services, CFO Dive sister publication Payments Dive reported.  

Since the early 2010s, EWA companies have served employees directly or partnered with employers to give workers access to a portion of wages they’ve earned before payday, with the benefit gaining popularity in high-turnover industries like retail and hospitality for hourly workers, according to a June 2023 report from the Harvard Kennedy School. 

The offering’s advantages include liquidity “with minimal hassle,” while drawbacks include fees that can be similar to payday lending products and “the potential for overuse leading to a cycle of dependency that leaves workers worse off than when they started,” the report states. Advances can come with an average annual percentage rate of about 100%, but that’s below many payday loans which can be pegged to a rate of over 400%, The New York Times reported last year.

Gronen told CFO Dive in an interview over the summer that if he offered EWA, he believed the company should bear the cost. But he acknowledged he faced a kind of moral dilemma when considering it. 

“As a CFO, you want to make sure you’re doing the right thing for employees and kind of helping them not get into trouble,” Gronen sad. “There are a lot of benefits but the downsides scare me because some people get $1,000 or $100 today and they go spend it immediately and then when they get to the first of the month they no longer have money to pay the rent.”   

Gronen also said he proceeded to review the option over his own reservations because he believes benefits and employee satisfaction lead to higher retention rates. 

Finance chiefs are increasingly tasked with balancing risks and benefits tied to layoffs as they make difficult cost-cutting decisions in response to rising expenses from myriad pressures — including tariffs and digital spending. 

U.S. layoffs this year through July rose to 806,383 — a 75% increase year-over-year, marking the highest January-to-July tally since 2020, when pandemic shutdowns pushed up pink slips beyond 1.8 million, Newsweek reported, citing statistics from Challenger, Gray & Christmas and impacts from government downsizing, corporate restructuring and the growing effects of artificial intelligence.

“Facing lower economic growth forecasts, an elevated cost of capital and policy uncertainty, CFOs are turning to cost optimization programs to defend margins,” Gartner, a consulting firm, said in a recent report.

“However, CFOs face a difficult trade-off. They must ensure the margin-preserving cost optimization programs don’t inadvertently cut too deep into the human capacity and capabilities required to drive growth during the next cycle,” Gartner said. 

While layoffs are on the rise, they aren’t always productive, according to the report, written by Vaughan Archer, a senior director and analyst in Gartner’s finance practice. Common mistakes include avoiding conflict by spreading cost-savings goals evenly across functions, determining who will be laid off by adhering to inflexible rules like first-in-first-out, or failing to anticipate costs resulting from layoffs, such as the need for contractor hiring or overtime pay to complete essential with less staff. Such unanticipated problems result in “unsustainable cost creep.”

Vaughan’s report outlines some practical steps finance chiefs can take to help their firms make smarter decisions on workforce cost challenges and, if needed, layoffs: 

1. Help your firm exhaust non-personnel cost-cutting options. Payroll typically accounts for a big chunk of functional and operational spending: for example, it accounts for 74.6% of the average finance function budget, according to the report. But CFOs should give their firms a range of other cost-savings measures that don’t affect headcount or require restructuring charges before moving on to layoffs, Gartner said.
2. Forget across-the-board staff reductions. CFOs must keep in mind the strategic importance of functions or teams to the broader corporate strategy when making headcount cuts. “Not all personnel expenses are created equal, and by treating them as such, CFOs risk penalizing the more efficient parts of the organization and eroding important sources of value,” Gartner said. 
3. Give budget-holders tools and data to make layoff decisions. Some managers use backward-looking measures when developing a list of potential employees to be cut. Instead, employees should be segmented "according to how they align with the future business strategy and their direct impact on revenue or performance.” Also, CFOs need to give management information that will enable them to quantify salary and non-salary cost reductions associated with a layoff, as well as the upfront costs that include severance, prorated bonuses, and other expenses associated with certain cuts, Gartner said.  
4. Stick with cost-cutting: And set up tracking systems to ensure the company does. CFOs must guard against gains in cost reduction initiatives being eroded via new expenses such as overtime and aggressive rehiring. “Tasking FP&A, for example, with maintaining a rolling list of departments and roles where cuts have been implemented in the last two years will help monitor cost reemergence,” Gartner said. 
5.  Communicate to retain critical talent. CFOs must work with senior human resources leadership to clearly communicate the financial rationale of the layoffs and cost-cuts. “Communications must address two critical phases: preparing management for employee layoffs and ensuring retained employees — especially top performers — remain consistently engaged, focused and motivated post-layoff,” Gartner said.