From Bob Cratchit’s Basement To Modern Finance Office With Dynamic Planning And Analysis

Pras Chatterjee

“Once upon a time, it was Bob Cratchit slaving away in a small basement doing books manually,” commented Jeff Hattendorf, COO and cofounder of Macrospect, referring to the famous character from Charles Dickens’ A Christmas Carol. “That evolved to systems that pull the numbers together and let us see what happened last month. But the systems we have today enable the CFO to see what happens every single day nearly in real time.”

That was one of many optimistic observations on the Feb. 8, 2017, “Coffee Break with Game Changers Radio” episode presented by SAP and produced and moderated by Bonnie D. Graham (follow on Twitter: @SAPRadio #SAPRadio). Joining Jeff to discuss the “Finance Manager’s Guide to the Future: Dynamic Planning and Analysis” were thought leaders Rob Ried, senior manager at Deloitte Consulting LLP, and Floyd Conrad, global senior director, Analytics Center of Excellence at SAP. Click to listen to the full episode.

Technology finally delivering on its promise for finance

All three panelists agreed that technology has finally come of age for the finance function. They had no qualms about asserting technology’s role in helping CFOs become true strategic business partners and key players in achieving corporate success.

Jeff observed that technology is enabling finance to see beyond traditional, historical data limits so it can now “make course corrections daily.” He also pinpointed the advantages of working with a previously unavailable, wide cross-section of data and using a range of analytics to begin to understand what really drives the business.

Floyd added that technology is now “truly good-to-go” for finance. He noted that in the past, “We’ve said things like ‘real time,’ but we meant ‘near real time.’ We said, ‘single version of the truth.’ Well, kind of, sort of. Today, this isn’t marketing jargon. This is something CFOs really need to look at now.”

But there is urgency to adopting the new technology. Rob had a warning for CFOs: “Failure to capitalize on technology will put you in an unenviable and uncompetitive position.”

Spreadsheets: Future friend or foe?

Panelists looked through different lenses at the future role of Excel spreadsheets. Floyd was the most emphatic about the need to move away from Excel, calling it “yesterday’s toy for finance” and pointing to the need for tools that provide better analysis of the information.

Jeff and Rob took a more middle-of-the-road position, emphasizing the still-current and widespread use and acceptance of Excel. Jeff pointed out, “Excel is the English language of finance and accounting. It’s the way finance and accountants look at numbers. They can do a lot of things with Excel. But it’s not enough by itself today.”

Time to abandon the rear-view-mirror perspective

It should come as no surprise that CFOs are traditionally averse to the unknown. Accuracy and certainty are ingrained in their professional DNA. But according to the panelists, staying stuck in “reporting mode” is a risk to both the finance function and the organization as a whole.

Rob encouraged CFOs to start asking the next-level questions that get them to a greater degree of accuracy in predicting what the next quarter, and the quarter after that, will look like. “If you have a truly integrated, dynamic planning system in place,” added Floyd, “you can be much more accurate, which CFOs like. The information will be incredible, and you can actually go look at what you should do in the future.”

Along the same theme, Jeff gently chided complacent CFOs who believe they are well-served by the organizations in place today. He commented that CFOs who fail to recognize and embrace opportunities provided by new systems and technologies will be less likely than their tech-enabled counterparts to spot imminent threats.

Crystal ball predictions: Who will be 2020’s successful CFO?

There was consensus, with slightly different takes, that the successful CFO of the future will be the one who welcomes and adopts technological innovation.

Jeff predicted the “plan, do, study, and act” model would be espoused by savvy CFOs to enable technology and improve processes.

Floyd anticipated an increase in the number of finance organizations that will be doing dynamic planning and analysis, noting that obsolescence could well be the price of not getting on board. “We could be talking about who didn’t – and maybe who’s still around and who’s not.”

Rob offered this profile: “By 2020, successful CFOs will be thinking in terms of future and predictive: marketing new products, cross-promoting with different organizations.” He cautioned that CFOs coming later to the game will be “working hard to catch up.”

Listen to the SAP Radio show “Finance Manager’s Guide to the Future: Dynamic Planning and Analysis” on demand.

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Pras Chatterjee

About Pras Chatterjee

Pras Chatterjee is a senior director of Product Marketing for Enterprise Performance Management at SAP, specializing in planning solutions. Prior to joining Product Marketing, Pras was a practice manager for SAP Business Analytics Services in North America as a leader in the EPM practice. He has also served as a solution architect for SAP Business Planning and Consolidation version for the Microsoft platform and SAP NetWeaver, focusing on planning and consolidations around the globe. Pras is a Chartered Professional Accountant and has worked with various software firms in the EPM space, and has had a career in finance with various Fortune 500 organizations.