Executives who prefer to prioritize long-term value over short-term orientation must take the responsibility of reorienting their companies toward long-term values. For that, it is most important to understand what management actions relieve successful long-term companies from their difficulties, and what efforts CEOs bring in to facilitate and support long-term management. Mckinsey surveyed more than 500 executives to identify the links between management behaviors and long-term business arrangements and they concluded that:
Research shows that behavior concentrated on short-term benefits has increased in recent years. A survey conducted for the executives shows they continuously get pressurized by the shareholders and directors to fulfill their targets at the cost of procedures developed for the long term. According to the managers, their CEOs would turn capital and other resources away from strategic initiatives to meet short-term financial goals. Executives may continue to focus on short-term orientation because long-term management can be challenging due to:
To achieve a winning position, companies can fill this gap by:
Long-term forecasting includes a time frame of six months to five years that gives CEOs an overview of a company’s financial demands and the future availability of investible excess. Even in major corporations, treasury teams are normally small and overloaded. By automating a time-consuming portion of their daily routine, they can devote more time to strategic work that adds value to the company.
AI-enabled cash forecasting helps CEOs with long-term planning by:
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