Company presidents and CEOs often come from marketing or engineering backgrounds and don't understand much about finance. When faced with cash flow problems it isn't unusual for them to demand across the board cuts in working capital assets while stretching payables, all to conserve cash. If working capital management was reasonably efficient beforehand such an order can be a disaster. Explain why.

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The Answer of Company presidents and CEOs often come from marketing or engineering backgrounds and don't understand much about finance. When faced with cash flow problems it isn't unusual for them to demand across the board cuts in working capital assets while stretching payables, all to conserve cash. If working capital management was reasonably efficient beforehand such an order can be a disaster. Explain why.

Company Presidents and CEOs Often Come from Marketing or Engineering