The current bout of inflation — as portrayed by Federal Reserve policymakers — was supposed to be a brief flare-up that quickly flickered out.

Instead, red-hot price pressures have scorched U.S. companies for nearly 20 months, with no clear date for a cooldown.

Consumer demand surged after a sharp pandemic-induced recession. Lockdowns and a tight labor market stoked wage gains. Prices for oil, grains and other commodities soared after Russia’s invasion of Ukraine.

Among all the causes for the spike in prices, disruptions to supply chains raised the earliest alarm among economists, including those at the Fed.

Some measures, such as one created by the New York Fed, suggest that bottlenecks in the flow of goods have started to clear up. But the gains have yet to show up in inflation data: The Consumer Price Index rose 7.7% in October compared with the same month last year.

“Inflation has largely been due to troubles with supply chains and it’s taken way longer to unfold and resolve than one would have thought,” Itamar Drechsler, a professor of finance at the University of Pennsylvania’s Wharton School, said in an interview.

“In regular times, our supply chain issues would not have been anywhere near as big of a deal,” Drechsler said.

Economists differ about when the Fed will achieve its goal of pushing inflation down to its 2% target, but agree that a smooth movement of goods through supply chains is essential for a steady decline in price pressures.

“As long as we have supply chain issues, it’s going to be hard to bring inflation back down to 2% or 3%,” Drechsler said.

For many CFOs under 50, rapidly rising prices were once a relic from their parents’ past, as quaint and unfamiliar as sideburns and bell bottoms. They may have only heard vague references about how double-digit inflation repeatedly savaged U.S. companies from 1974 until 1981.

High inflation upends CFOs’ strategies for prices, wages, capital allocation and other factors determining profits, while also straining their relations with vendors, customers, employees or shareholders.

CFOs suggest buffering against the worst inflation in nearly 40 years — along with recession risks as the Fed raises borrowing costs to cool the economy — by taking four steps:

1. Conserve cash

Amid persistent price pressures and increasing forecasts of a downturn, “conservation of cash is on the minds of CFOs for sure,” according to Brian Prantil, a supply chain management expert at Insight Sourcing Group.

Like many companies, the software firm CallRail faces price pressures on many fronts, including in negotiations with vendors and in adjusting employee pay and benefits, according to CFO Jim Morgan. The company provides call tracking and marketing analytics software to more than 34,000 small- and medium-size businesses.

“Most finance folks I’m talking to are taking a very conservative and prudent approach going into next year,” Morgan said in an interview. “We have a plan that is generally more conservative than usual.”

CallRail is comparatively well positioned for a downturn because of its longstanding conservative approach to cash, Morgan said.

“We never burned capital,” he said, adding “we don’t have to think about raising capital in 12 or 18 months.”

CallRail currently seeks a balance between attracting talent, identifying targets for mergers and acquisitions and investing in software innovation behind new features and products, Morgan said.

“We talk in terms of ‘what’s the best use of the profits that we create, how are we going to look for opportunities,’” he said.

Similarly, Fetch Rewards, a shopping savings app, also feels an impulse to make the most of its cash, according to CFO Nupur Sadiwala.

“Cash preservation is top of mind,” she said in an interview. “Once you hit the recession environment, funding could get more challenging.”

Fetch Rewards completed a Series D fundraiser for $240 million this year before recession forecasts began to pile up. Still, the prospect of a downturn has sharpened its focus on funding priorities, Sadiwala said.

“This helps give the company a little more discipline” and “makes every investment that much more critical,” she said.

2. Step up cost-cutting collaboration

With inflation high and supply chains clogged, CFOs can often improve cash flow by working closely with their company’s procurement team to realign prices with any increase in input costs, Prantil said.

A CFO can often trim costs by as much as 15% by pushing for a review of the volume or technical specifications of purchases, Prantil said in an interview.

“You should challenge all the things that you’re buying and ask, ‘Why are we buying it? Can we buy something different? Do we have too many of these on the shelf?’” Prantil said.

“There’s a lot of opportunities when you just look at what you’re already buying in a different way,” he said.

A critical review of outsourced services can yield similar savings, Prantil said. For example, many companies that allow staff to work from home have cut costs by reducing janitorial work to less than five days per week.

“CFOs tend to see procurement staff as identifying suppliers rather than optimizing suppliers,” Prantil said. “They should look to their procurement professionals as strategic partners.”

At CallRail, C-suite executives promote collaboration by urging employees at every level to “mind the business,” Morgan said, citing a longstanding company slogan. “We double down as business partners,” he said.

“In an ideal world I want everyone to be thinking like the finance team,” Morgan said. “It allows the right framework to be everywhere without finance and accounting having to be in on every decision.”

CallRail underscores in employee meetings that “we’re all business owners,” he said, adding that the company backs up the principle with an equity sharing program.

“We get a lot more leverage out of promoting that idea than just having a couple of people trying to say, ‘Look, you’re spending too much or we need to cut back in these areas.’”

A unified mindset is especially important as CallRail adjusts to the turbulence from inflation, Morgan said, noting that most employees have never encountered rapidly rising prices.

At monday.com, top executives emphasize to staff during monthly meetings that, in the face of high inflation, employees need to discard some long-held assumptions about the market and broader economy, CFO Eliran Glazer said. The company provides project management software.

“We explain inflation and say, ‘Guys, this is a completely different environment throughout the world,’” Glazer said in an interview from company headquarters in Tel Aviv.

“People don’t even know what ‘inflation’ means!” he said. “So definitely — education, education, education.”

3. Be nimble

CFOs saw first-hand the value of agility in 2020 when the sudden onset of COVID-19 forced lockdowns, spurred a “dash for cash” by companies across a range of industries and plunged the U.S. economy into its sharpest recession ever.

“CFOs learned over the past few years that flexibility is key, and that uncertainty demands flexibility and an even keel through choppy waters,” Morgan said.

CallRail has heavily invested in the technology for near real-time tracking on customer use of its platform, Morgan said.

“It used to be overnight data was OK,” he said. “Now, in the world of analytics, if we can get fresh data in a few hours, we can probably keep the rest of the organization happy.”

Agility is essential for monday.com as it hedges against turbulence in currency markets, Glazer said. The company generates 30% of its revenue in the U.K., Australia, eurozone and other regions outside the U.S.

Adapting to the strong dollar poses a challenge and opportunity, he said. The U.S. Dollar Index — which tracks movement of the greenback compared with a basket of six major currencies — has surged more than 12% this year.

Currency volatility poses a potential revenue setback as high as 3% for monday.com, Glazer said. “A foreign exchange loss is not a business expense or an operational expense, so you don’t want it to lead your P&L numbers on a regular basis.”

While posing challenges, market turbulence and efforts by the Fed to curb inflation have opened up opportunities for monday.com as well, Glazer said.

For example, yields on U.S. debt have increased as the Fed raised the federal funds rate this year from near zero to a range of 3.75% to 4%. Seeking a low-risk return, Glazer invested some of monday.com’s $830 million in available cash in U.S. bonds.

4. Don’t panic

By setting realistic expectations, a CFO can help employees deal with inflation-induced stress vented by shareholders, vendors and other stakeholders, the financial executives said. Along with inflation, risks such as the war in Ukraine and slowing growth in China cloud the outlook.

“As the CFO, you have to be in the front seat — you have to lead and be proactive rather than be worried,” Glazer said.

As headwinds shift, monday.com regularly updates its range of projected scenarios for coming months and adjusts its planning, Glazer said.

Every month he leads his 50-member team in a review of factors, such as cash flow, currency volatility and revenue and expenses. He is wary of making hasty decisions about reducing payroll or cutting spending on innovation or marketing.

Glazer expects that inflation during the next three years will probably not fall below 5% but cautions against a narrow focus on price pressures. “Don’t let inflation dictate how you look at your numbers.”