When times are hard, it is easier for corporates to reduce expenditure than to find ways of boosting revenues.
However, cost management is about more than just cutting spending – it requires a holistic approach. Saving in one area might free up funds to invest in projects or technologies that could deliver long-term competitive advantages or generate greater efficiencies.
According to Deloitte’s Q1 2026 North American CFO Signals survey, cost management is currently the number one internal concern for finance leaders amid shrinking profit margins and expectations of higher inflation.
One of the main areas targeted for savings is recruitment, with most corporates expecting little or no increase in headcount over the next 12 months – a view shared by Gary Vecchiarelli, CFO at Nevada-based CleanSpark, who reckons hiring will remain flat in 2026.
“I think many companies will remain selective with recruitment,” he says. “The focus is increasingly on productivity and leveraging technology, including AI, to drive growth rather than expanding headcount at the same pace as in prior cycles.”
The CFOs surveyed by Deloitte appear more interested in diverting capital than in reflexively reducing it. When asked to indicate how current cost management considerations are changing their organisation’s allocation of capital, more than half (52%) cite redirecting operating expense investments, while 46% say their organisations are redirecting capital expenditure investments due to cost management considerations.
Issuing stock is seen as a more attractive option for raising capital than borrowing where equity financing is available in sufficient quantity.
“The attractiveness of equity versus debt depends heavily on a company’s capital structure, growth profile and market valuation,” observes Vecchiarelli. “For well-positioned companies, equity markets remain accessible although investors are placing a greater premium on growth prospects, profitability, cash flow generation and capital allocation discipline. Additionally, liquidity of a company’s stock can open up various options to raising equity.”
Encouragingly, the vast majority of CFOs believe that, excluding the CEO and board of directors, finance has the greatest responsibility for overseeing cost management at their organisations.
When asked which levers have proven to be most effective in controlling costs – excluding workforce reductions – automation or technology upgrades was the most popular choice, followed by increased productivity efforts and investments.
As for their organisation’s biggest internal challenges to managing costs, many hint at more organisational and cultural factors. Almost four in ten cite misalignment between corporate strategy and their approach to cost cutting, while one-third refer to an absence of a cost management culture.
Unsurprisingly, supply chain disruption is the most worrying external factor for corporate CFOs. Many companies have been forced to change the way they source materials due to disruptions caused by attacks on merchant vessels in the Red Sea and the closure of the Strait of Hormuz.
“The lesson from recent years is that resilience matters as much as cost,” says Vecchiarelli. “We have diversified suppliers, strengthened inventory planning and built greater flexibility into procurement strategies to reduce concentration risk.”
