How CFOs can outsmart the unpredictable economic landscape in 2025
Businesses across the UK will be encouraged by the prospect of faster economic growth in 2025. However, this optimism is tempered by several pressing challenges, including persistent inflation, geopolitical instability, and market volatility. These factors make financial forecasting a high-stakes endeavour, with chief financial officers (CFOs) and finance leaders under immense pressure to make strategic decisions that balance risk and reward.
Moreover, the margin for error is slimmer than ever. According to Pleo’s Finance and Business Synergy Report, while business ambitions are on the rise, investment levels are not. Over a third of businesses have faced budget cuts, and only 22% have seen an increase in their financial resources. For organisations seeking to accelerate growth in 2025, the key will be equipping their finance teams with the tools to identify stable opportunities amid economic uncertainty.
Managing uncertainty as a catalyst for growth
A lack of visibility into financial operations can lead to poor spending choices and ill-advised cost reductions. Alarmingly, 47% of UK businesses regret making drastic budget cuts in the past year, many of which hindered rather than helped their growth prospects.
To counteract this trend, finance teams must refine their ability to predict and manage uncertainties. While a time machine remains elusive, businesses can achieve greater foresight by fostering interdepartmental synergy, streamlining processes, and leveraging technological advancements to improve financial visibility.
Here are three key strategies CFOs can employ to navigate the unpredictable economic landscape of 2025:
1. Leverage data for smarter decision-making
Analysing historical data enables businesses to forecast future financial trends with greater accuracy. However, to maximise its impact, data should not be hoarded but treated as an accessible resource for decision-making across departments.
For instance, budgeting remains a perennial challenge, fraught with the risks of over- or under-allocation. By utilising historical financial data, circumstantial trends, and predictive analytics, finance teams can mitigate these risks and enhance budget precision.
Artificial intelligence (AI) is playing a transformative role in this domain, but its effectiveness depends on human expertise. Finance professionals must refine their AI skills, particularly in prompt engineering, to extract meaningful insights from vast datasets. Just as clear communication leads to better human interactions, well-structured AI prompts can yield valuable financial intelligence, streamlining processes and improving decision-making accuracy.
2. Foster cross-departmental collaboration
Effective collaboration is integral to financial stability and strategic growth. A staggering 60% of UK businesses cite poor communication, lack of departmental understanding, and weak internal collaboration as primary drivers of poor spending decisions. Recognising this, 67% of organisations have made improving in-house collaboration a key priority for 2025.
Some leaders may perceive collaboration as less tangible or impactful than data analytics or financial modelling. However, the two are not mutually exclusive. In fact, transparent communication and collaboration enhance financial clarity, enabling more informed decision-making. With 76% of UK businesses acknowledging that stronger internal cooperation can improve financial performance, breaking down silos is no longer optional—it is essential.
3. Modernise the treasury function
While CFOs cannot predict the future, they can shape the trajectory of their financial operations. A well-optimised treasury function is a powerful tool for maintaining financial stability and minimising uncertainty. Yet, many businesses fail to harness its full potential.
Currently, treasury operations are often burdened with time-consuming manual processes, leading to inefficiencies and heightened risk exposure. Even organisations that believe their treasury functions are optimally managed should conduct periodic audits to ensure readiness for the challenges ahead.
Tasks such as cash flow analysis, subscription management, and cross-entity financial oversight consume hours of manual labour each week. Automating these processes not only reduces errors but also frees up valuable time for finance teams to focus on strategic initiatives, such as identifying investment opportunities and improving cash management. As the finance sector undergoes a long-overdue digital transformation, ensuring that treasury operations keep pace with technological advancements is paramount.
Creating stability in an uncertain world
While the future remains unpredictable, CFOs and finance leaders can take proactive steps to mitigate uncertainty and drive business growth. By prioritising data-driven decision-making, enhancing collaboration, and modernising treasury functions, they can create a framework that balances risk with opportunity.
The businesses that thrive in 2025 will be those that embrace synergy, technology, and strategic foresight. In an economic landscape where certainty is scarce, finance leaders who can effectively manage uncertainty will be best positioned for success.
