Planning Isn’t Just for Finance: It Takes a Village to Be Successful

Internally and externally, the finance function is under a microscope. Finance is no longer just counting beans – it’s a strategic business partner across the organization.

Disparate data and siloed departments – internal factors – coupled with inflationary pressures, recessionary headwinds, and market competition – external factors – are forcing C-suite executives to grasp new solutions.

Finance leaders must make decisions more quickly than ever, and they need the support of the rest of the business to accomplish it.

Enterprise Planning Delivers Value

Functional and business heads are all involved in building and supporting the company’s strategy. But then Finance builds the plan alone … does this really make sense?

Imagine a world where these stakeholders owned their portion of company strategy end to end, including all of the metrics and leading indicators that they intend to drive. They interact with the planning process and related systems to commit to those metrics and understand where they fit in the bigger picture.

This is Enterprise Planning and Performance Management in action. 

If done right, enterprise planning is the future engine for well-rounded and connected data insights, decision-making, and financial health. It’s a timely remedy for the CFO specifically and the rest of the business generally. Additionally, the entire C-suite benefits from this visibility into the financial results.

Implementing an enterprise-planning model requires:

• An enterprise-wide vision where Finance is positioned to drive strategy and value across the enterprise.
• Clearly defined KPIs and metrics that direct business strategy and support decision-making.
• A Connected Financial Systems Architecture, providing maximum efficiency, data flows, and real-time information that is clearly understood across the enterprise.
• The ability to model multiple scenarios and adapt to changing market conditions.
• Engagement at a new level from both the business and functional leaders.

It’s time to change.

4 Areas to Prioritize for Enterprise Planning

1. Be Agile to Market Conditions

Enterprise planning doesn’t just mean creating an annual budget and updating a forecast with the latest actuals each month. Rather, it requires a continuous approach that enables stakeholders to react, pivot, and re-plan effectively. Companies can achieve greater agility by:

• Ensuring all planning activities align to the company’s vision and strategy (e.g., budget based on a 3-5 year strategic plan, and updating the strategic plan on a monthly/quarterly basis using real-time results).
• Enabling a driver-based rolling forecast, using predictive planning capabilities to highlight past/future trends.
• Being future-focused by quickly creating new scenarios and versions to highlight best/worst case and what-if analysis. This allows teams to adjust for the “cone of uncertainty.”
• Proactively re-assessing against ever-changing market conditions.

2. Clearly Defined Roles and Responsibilities

Enterprise planning lives and breathes on process. It requires:

• Clear executive sponsorship: Driving the tone from the top helps create a shared experience for all users.
• Proper alignment of roles and responsibilities among stakeholders helps eliminate duplicate efforts. Everyone should understand how they can add value to the planning process.
• Understanding the required skills that each business function needs to perform their tasks in the future, and upskilling users of technology/automation to shift process duties away from Finance to relevant parties (e.g., HR responsible for headcount/roster planning and management).
• Streamlined FP&A processes that spread duties across an organization’s business functions, reducing the time burden placed on Finance and freeing them up to allocate more time to focus on value-added activities, such as advanced/predictive analytics, strategic long-term planning, and continuous process improvement.

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3. Integrated Finance Architecture

Enterprise planning must be supported by a fully integrated systems architecture. The integrated architecture supports the process by ensuring reliable data and common data entry points combine to provide a common, linked output across all business functions.

Below are integral ways to leverage and benefit from greater connectivity:

• Integrate & Automate: Internal workflows and systems within and across multiple functions are often disconnected, manual, and painful in nature. Automating workflows within the system(s) – e.g., purchase orders/requisitions, metadata updates – can alleviate this pain. Streamlined integration leads to stakeholder benefits such as:
  • Operational or department leaders developing sales forecasts to establish reasonable estimates for future reporting periods.
  • Human Resources communicating with Finance to understand hiring required to meet forecast expectations.
  • Ability to create top-down and bottom-up planning scenarios leveraging seamless data integration across multiple systems.
  • Building seamless integrations between data lakes/warehouses to the planning tool.
• Team with IT to create a competitive advantage: Most organizations view IT primarily as a support function; however, IT should be viewed as a strategic partner to create a competitive advantage for the enterprise by:
  • Investing in cloud-based, leading EPM tools that have predictive analytics, AI, and machine learning capabilities.
  • Helping engineer data for commonality across the enterprise.
  • Providing data scientist experience to help Finance bridge between Financial and Operational Data.

In total, key functional stakeholders can leverage tech capabilities to plan, while an EPM tool gives users the ability to drive insights from automated reporting. It’s important to note that processes and technology must be connected to achieve a fully integrated finance architecture.

4. Strong Enterprise Master Data That’s Governed and Controlled

Companies with successful planning and reporting capabilities also have strong finance master data governance. They have clearly defined metrics, KPIs, and data definitions across the organization, and those views of master data are aligned across Finance, Operations, IT, and HR. They also have the following traits:

• Dimensions are unified across all data sources, definitions are clearly understood, and mappings are automated and controlled for cleansing/refinement, such as mapping vendor detail to monthly invoices.
• Data is flexible and extendible, yet controlled, providing multiple views (e.g., product, customer) across the organization.
• Master data is governed centrally, and downstream systems are updated near real-time, resulting in stronger monitoring of performance and more efficient compilation of reports and analysis.

To be successful as an organization, everyone must strive toward creating a competitive advantage. By structuring a process in which connected data from each department is delivered on a timely basis, C-suite executives can develop strategic plans and see into the future by leveraging readily available predictive insights.

For expert support designing an optimized finance structure with reduced manual overhead, contact CrossCountry Consulting.