For decades, organization's finance departments have used FP&A to budget and forecast within a fiscal year, conduct historical reporting, and generate standard reports. While this traditional approach worked well in the past, businesses today face a host of global and local challenges that require their finance groups to take a cross-enterprise approach, incorporating activities from functions that are crucial to moving the business forward, such as sales, marketing, and operational planning, to align with their company’s strategic vision.
This holistic approach is business planning and analysis, or BP&A. The end result? Planning becomes a more dynamic process that focuses on the future in a more effective and efficient manner.
Most financial planning and analysis (FP&A) professionals spend the bulk of their time forecasting for the long term, instead of helping the different functions in the business understand what they need to do in the short term.
Having the right operating model is the key underpinning of FP&A’s ability to deliver the insights sales, marketing, or operational planning need to address any type of event or scenario that will affect the company’s competitive position and strategic vision.
The new reality for business planning and analysis
Disruption is prompting FP&A transformation. Discover 5 focus areas to enable real-time insights across the enterprise.
Five ways to turn your FP&A function into a business planning and analysis partner
Does your finance function have what it takes to agilely respond to disruption?
The BP&A imperative is to provide value and identify paths to take forward, even in the wake of large, unexpected disruptions.
To ensure success, BP&A teams should focus on five key areas.
The new capability you need in your competitive toolkit
Rapid strategic modeling is a sustainable, software-driven capability to leverage internal and external third-party data on demand to obtain timely results, often in the same day. The goal is to enable a focused, business savvy group of FP&A professionals.
FP&A functions are using rapid strategic modeling to enable real-time, on-demand data for answers to critical questions. Explore how to get started on the journey to accurate, fast results.
Rapid strategic modeling
Transition to a continuous forecasting model and end the budget cycle blues
In a business environment characterized by rapid and frequent change, forecasting is the aspect of traditional business planning and analysis about which many business planning professionals are least confident. In the ongoing quest to improve the underlying forecasting process, we believe organizations should move beyond the traditional budget cycle and strive for a more agile and flexible approach.
This entails examining specific business drivers and developing a deeper understanding of the factors most likely to move the forecast in the right direction so the team can react quickly and with conviction. The overarching objective is to get away from the traditionally long and arduous focus on the budget and emphasize a rolling, driver-based forecast that identifies the specific data elements and business drivers that really move the needle.
From budget cycle to continuous forecasting. The road to driver-based planning
BP&A as a value creator
Part of BP&A’s goal is to position finance as the function that can drive business value throughout the entire enterprise. So, BP&A needs to be customer-centric and focused on creating value, driving data-based decisions, and supporting the competitive strategy.
To get disruptor-driven insights, BP&A professionals must have advanced technological capabilities. Technologies and platforms that can enable dynamic planning and analytics across the business include data storage and ingestion, cloud, predictive analytics, digital labor, and data visualization tools.
Leading technologies and platforms
Financial planning skills are no longer enough. The professionals on the BP&A team must have business acumen to contextualize what they’re working on, be skilled in new data analysis technologies, think critically about the type of data the organization should be looking at, and understand the correlation between the data and its impact on the business.
Enhancing and increasing skills