Cash flow optimization is critically important, especially during periods of Continuing Resolution (CR) authority. The objective is to manage the limited funding authority available within the constraints imposed by the CR. Effective cash flow optimization involves several strategies and practices:
- Managing disbursement timing
Coordinate with Suppliers and Service Providers: Partial funding and precisely timing payments can help reserve funding authority for urgent requirements.
Regular Review: Monitor inventory levels against forecasts to avoid excess or shortage. - Monitoring and Forecasting Cash Flow
Cash Flow Forecasting: Regularly update
forecasts to anticipate funding authority needs, identify potential shortfalls, and plan for future actions needed to support operations. - Real-time Monitoring: Continuously monitor financial data to provide real-time insights into cash positions and support effective decision-making.
- Making Use of Technology
Automated Systems: Lots of data is good, but good data is better. Data warehousing systems offer immense data access, but failure to recognize and understand data correlations, contradictions, and compromises creates substantial risk. Automated
systems that use business intelligence can rapidly navigate the morass ‘big data’ frequently creates. - Cost Control and Reduction
Regular Expense Review: Regularly reviewing expenses to identify areas where costs can be reduced or postponed without impacting operations.
Cash flow optimization is a critical ongoing process for any organization. It requires regular review and adjustment based on the current economic environment, market conditions, and the organization’s specific needs.
ITI has used commanding process knowledge and advanced automation to help the ANG mitigate cash flow risk inherent in the CR process and maximize annual obligation rates to support mission accomplishment. Smart automation tools and smart people enable a level of situational awareness and confidence that allows the ANG to maximize every dollar.