Planning is everything, but for many financial executives, planning involves an extremely complex process of predicting metrics and budget impacts of sprawling projects with many moving parts. For the practical-minded finance executive, this leads to an ongoing search for better planning tools delivering faster, more informative reporting solutions that can help them be more efficient in setting, and monitoring KPIs and as a result making more effective business decisions.
CFOs in many industries are looking for the right technological solutions to breathe life into their budgets and plans. Current planning, budgeting, and forecasting processes are just too difficult to complete within a reasonable amount of time without disrupting business operations. In addition, enterprises are finding it difficult to get accurate results due to market volatility using their current technology. The following are real-world examples and survey results covering how financial planning solutions are helping enterprises do more in five significant areas.
1. Adapt to market conditions
VELUX is a Danish window maker that needed to adapt to the changing designs, technologies, and lifestyles of modern homes and businesses. They found that their yearly budget planning process was not fast enough to accurately provide the insights that they needed to react to the market in a timely manner. They moved from yearly to a repeated monthly business planning by using the power in in-memory computing. They now have a clearer vision of what kinds of windows the market wants, the lifespan of what they produce, and economic impacts across the organization.
2. Identify growth opportunities
Forecasting should do more than just helping enterprises avoid surprises. Good forecasting can also identify a window of opportunity before it slams shut. Intuitive modeling makes it possible to analyze a variety of complex what-if scenarios at once. Companies that embrace new planning technology gain the ability to identify opportunities and react in the most profitable way. That is what happened at Hunt Consolidated, Inc. (HCI) when they recognized a growing need for centralized, top-down planning to manage the business as a whole. Using in-memory computing as a platform, HCI was able to run wide-open queries involving hundreds of millions of record objects, rendering what-if scenarios in seconds. This opened up a world of original solutions and opportunities for them.
3. Allocate resources
Aberdeen’s 2014 Excellence in Financial Management Survey revealed that the top three priorities for finance leaders were:
- Conducting assessments of financial processes
- Automation of core functions
- Promoting collaboration across all finance roles
All three play a part in discovering the optimum pathway for allocating finance resources. Allocation and replenishment assessments allow financiers to identify cost centers that need to be reduced. In addition, these assessments make sure the supply chain is optimized so the products and services customers need are available when they want them.
4. Execute organizational strategies
CFOs are searching for self-service technology that allows them to visualize data in ways that are most convenient for them instead of relying on IT. According to Aberdeen’s report, “The Next Generation of Cloud FP&A,” 87 percent of business users in the cloud either have self-service options or would like to get them in the very near future. They need the ability to execute organizational strategies with detailed forecasts using embedded analytics and scenario projections without waiting for help from IT.
5. Increase profitability
Many finance executives say they need better solutions to face what’s coming next. In Aberdeen’s “The Next Generation of Cloud FP&A,” 37 percent of finance leaders say that their current forecasting and budgeting processes are too long and are resource intensive. Their companies are now searching for a cloud solution that helps them reduce operational costs and boost profitability. Cloud-based financial planning and analysis tools are better able to run queries on thousands of variables simultaneously and respond dynamically to real-time data.
The finance solution
Finance leaders are searching for the right solutions to deliver better speed and computing power so they can produce results in these five areas. In our next blog, we’ll take a step further by looking at specific technological innovations that deliver results. Another great resource for CFOs is available now at the finance solution content hub, where there is a rich library of researches and insights into the most relevant topics in the world of finance.
Want more on how simplification can boost your bottom line? See The Time For Simplification Is Now: Why It’s Important And How You Can Get Started Today.