The days of a scheduled, reactive approach to financial planning are long gone. Business outcomes and solvency rely heavily on a business’ ability to shift with the times, especially in a pandemic. Today’s environment requires an agile and proactive approach to financial planning.
Static planning processes may seem comfy and familiar, but they don’t allow for dynamic planning. Oftentimes, companies don’t think twice about the systems they’re using for financial planning because they don’t feel they have the bandwidth to take a step back and assess their strategic approach. As a result, they miss the opportunity to dynamically forecast, test various business scenarios, and automate time-consuming financial processes.
A key component of achieving business agility is the ability to leverage modern technology to automate labor-intensive processes. When you recover this, you can then focus more on the overall strategy that will drive company growth.
And with that, here are our top financial planning tasks to automate to save valuable time and resources:
1. Reports
Reports are often created at the end of the planning cycle and provide insight into the overall well-being of your business. Common reports include progress towards quotas, current spending, and other metrics key to manage your teams. The problem with manual reporting is that employees need to spend countless hours creating a report that is only helpful in the very near future and if a sudden shift causes the need for new reports, leaders are stuck waiting for financial teams to update those reports.
These problems can be mitigated by using a financial planning tool like Workday Adaptive Planning. It can create an automated reporting workflow that enables leaders to access, generate, and understand reports on their own. When creating these automated reports, be sure to include “budget vs. actuals” reporting to analyze real-time progress and identify discrepancies that could signal problems or opportunities.
These automated reports greatly reduce planning times and empower leaders to make decisions instead of waiting for updated information. They can also be created on demand instead of only at the end of the planning cycles allowing for a clearer picture of current operations within your business.
2. Modeling
As previously mentioned, the days of a scheduled, reactive approach to financial planning are long gone. Instead, business leaders need to be proactive in their decision-making. One way of doing this is through the use of models. Without models, a leader’s ability to predict the future becomes greatly hindered especially when trying to account for key changes in the market.
Leverage modeling automations to easily build and analyze models and test what-if scenarios. You should be able to model your business in the same way you view it. This applies to financial modeling around your fiscal calendar, academic calendar, funding schedules, revenue recognition schedules, or other business milestones. With a financial planning solution that can cross-functionally automate data processes and forecast outcomes, you and your team can understand the impact of each decision you make across business units.
Modeling automations allow for greater business insight in a number of different ways. Most importantly, what-if scenarios are modeled instantly while showing the overall impact of the change on your business. Using automations to improve models adds another layer of accuracy as historical data is now supplemented by current data.
3. Rolling forecasts
Rolling forecasts are a necessity when trying to plan for the future. Instead of relying on a single prediction, rolling forecasts constantly update their prediction to increase accuracy. Without the use of rolling forecasts, businesses are stuck with the same static plan that they created at the beginning of the year, even though the business environment is changing.
Leveraging real-time data makes life much easier for decision-makers. Whereas budgets capture thousands of line items, rolling forecasts reflect specific business drivers such as risk, profit, and working capital to help businesses prepare for critical shifts in these figures. Use an integrated financial planning tool to help accurately update these forecasts through the use of current and historical data.
With the creation of rolling forecasts, business leaders can adjust company goals and strategies according to the business trends. Decision makers are also able to easily identify problem areas as their forecasts reflect the current trends of the business.
4. Data integration
Without data integration, none of the previous automations would be possible. Instead, businesses without data integration lack a single source of truth where they are able to quickly identify company information. Without this, teams may spend more time compiling data than making actual calculations and decisions.
Automate data flow between your CRM, HCM, ERP systems, or any transactional system your business depends on to ensure your team is working from the same, shared data model. Automated data integration proves to be an enormous time-saver for finance teams and minimizes the risk of error from manual data transfer.
With data integrations, planning cycles are greatly reduced thanks to the consolidation of data. Furthermore, data integration helps the scalability of your business as a single source if truth is maintained as your business grows larger. All of these benefits ultimately result in clearer insight into your business.
5. Board Reporting
Often times teams spend weeks consolidating data, performing analysis, and calculating models to provide key insights during board meetings. These reports identify potential problems within your balance sheet, current assets and spending, and other big-picture information valuable to decision-makers and shareholders alike. Especially for publicly traded companies, these reports directly determine company value as well as provide insights into business health. Although extremely valuable, these reports take time away from regular business operations.
In order to solve this problem, leverage a tool that integrates directly with Excel and PowerPoint in order to update existing reports and slides at the click of a button. This allows for clear comparisons with past and current data as the calculations are identical to updated data. This also allows for greater confidence in these reports as they stay on a single source of truth as opposed to being passed around before meetings.
Start Automating with QBIX
The main goal of automation is to save time. Although it may seem like a daunting task to begin on your own, your business will be much better off once you have done so. Schedule a time with the QBIX team to learn more and get started with an integrated solution. With QBIX you are able to gain valuable business insight while aided by industry experts.