Share with your CFO
American companies are sitting on a record $1.94 trillion working capital opportunity, according to The Hackett Group’s 2025 North American survey of the largest 1,000 nonfinancial public companies. That figure, up from $1.73 trillion in 2024, represents cash trapped in receivables, inventory, and process inefficiencies. Revenue grew 6% across the group, but the gains split sharply: semiconductors up 32%, computer hardware up 21%, while homebuilding and telecom each fell 4%. Tariff-driven inventory stockpiling pushed days inventory outstanding to 56 days, and the broader shift from just-in-time to just-in-case supply chain logic is locking up more cash than at any point on record.
What this means for your business
The $1.94 trillion number sounds abstract until you ask what’s holding it hostage. For product-heavy companies, the answer is inventory accumulated defensively against tariff uncertainty, and that’s not going away as long as trade policy stays unpredictable. Service and media businesses improved their cash conversion cycles by leaning on payables optimization, extending the time they take to pay suppliers. If your company sits in a physical goods category, you’re almost certainly on the wrong side of that divergence, and the gap between the two cohorts widened materially in 2025.
Hackett’s researchers, who sell advisory services into the finance operations market they’re measuring, point to agentic AI automating invoice-to-pay workflows as a meaningful lever on days payable outstanding. The incentive to frame AI optimistically is real, but the underlying claim isn’t wrong. Automating accounts payable and receivable matching is one of the few AI use cases in finance ops where the ROI is direct, measurable, and doesn’t require a multi-year transformation program. A 2.9-day improvement in DPO compounding across a company with $10 billion in annual purchases is worth hundreds of millions in freed cash. That math works with or without the AI hype wrapped around it.
The falsification condition for the AI-in-finance-ops story is simple: if days payable outstanding stops improving or reverses in the 2026 survey despite wider agentic deployments, the automation gains aren’t landing where vendors claim. Watch that single metric. It’s the one number that would force a genuine reassessment of whether AI in the finance function is delivering or merely being purchased.
Concept deep-dive: Cash Conversion Cycle
The cash conversion cycle measures how many days pass between a company spending money to make a product and collecting cash from selling it. Think of it as the time your money is “out of the building.” It combines how long inventory sits unsold, how long customers take to pay, and how long you take to pay your own suppliers. A shorter cycle means faster access to cash. At 38.4 days for the largest U.S. companies, even a one-day reduction across that group frees billions in liquidity.
Based on reporting from US firms face record $1.94T ‘liquidity challenge,’ Hackett says, originally published 2026-08-05 09:08:00.
