18 May 2011 | Angeline Albert
CFOs aim to spend the same in the next 12 months as they did during the
past year as they continue to look for efficiencies.
A survey of 665 senior finance executives worldwide found spending in
categories such as marketing, IT, professional services, raw materials,
transport and logistics, business travel and advertising would continue at the
same level as last year.
According to a report, A Taleof Two Recoveries, CFOs on managing for growth produced by CFO Research Services and American Express, only a
fifth of UK finance directors will increase spending on production inputs this
year. With commodity prices expected to rise during the same period, it
suggested spending would be cautious. “Finance executives are reluctant to
relinquish the efficiency efforts that served them well through the recent
downturn,” it said.
The biggest spending cuts this year, according to 33 per cent of
respondents, will be in travel for staff meetings and internal events.
George Montague, vice-president of finance and strategy at UK-based medical
equipment producer Medtronic told researchers
he is already bringing more scrutiny to bear on travel expenses. This is not
only because volume has increased, but also because fuel prices are likely to
push airfares up. His approach is “to increase the awareness through information.
We’re also looking at our travel policy and seeing if it makes sense to make
some modifications to it.”
Useful tactics could include limiting travel for internal meetings or
reducing the number of travellers who attend a particular event. “It’s a matter
of ensuring that our travel is cost-effective,” Montague said, rather than
simply cutting back.
"Finance executives are maintaining discipline and carefully
weighing each investment. Companies are looking closely at the justification
for spending, laying the foundation for more sustainable expansion," said
Janey Whiteside senior vice-president at American Express.
The survey was conducted in April and is the fourth annual study of
global business spending.