New methods to shorten your FP&A budget cycle
At the heart of every FP&A team is the budget process.
But budgeting standards are changing, and the traditional method of setting the stage for budgeting, planning, forecasting, and risk management no longer complements the digital age of real-time data.
This mismatch is challenging—finance professionals are still required to deliver data that is flexible, while simultaneously maintaining the stability of a traditional budget.
Companies greatly benefit from improving FP&A capabilities to handle ever-increasing amounts of data—or Big Data—which can improve the execution of operating plans and ultimately help to make better business decisions. Being able to collect data alone does not ensure its success. It's the interpretation and perspective from various departments that make the biggest difference to help forge a company's future—especially for FP&A teams.
It's time to put the "A" back into "FP&A."
This article from CFO.com highlights the struggles finance teams and C-level executives face when it comes to harmonizing data with FP&A. One issue is that teams are "too buried in basic financial management duties to work on boosting their FP&A capabilities." In other words, the time employees need to dedicate to improving the execution of operating plans isn't attainable in the current state of FP&A, despite the long-term savings it could produce.
We've seen similar problems, and that's why we've teamed up with the AFP to assist FP&A teams of all sizes—providing the strategies they should adopt to ensure long-term success.
The AFP guide How to Shorten the Budget Cycle examines the difficulties faced by organizations with fast-moving data against a traditional budgeting processes. It discusses how to implement new methods and best practices, including real-world examples from successful teams.
Here's a quick preview:
- Be flexible. External factors are influencing and changing an organization's budget daily. Finance teams need to be ready to react to change and gather the necessary data quickly.
- Align the budget with organizational strategy. Budgets are established top-down. Increase efficiency, and make sure the budget and allocations are in tune with the direction of the company.
- Adopt new technologies. Traditional, manual, and error-prone processes hinder success. Upgrading to a solution to support a dynamic, forward-looking process is critical.
Get the guide without an AFP membership or subscription right here.