The CFO’s Guide to Planning and Analysis

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If we’ve learned anything over the last few years, it’s that business planning and projections require a very adaptable mindset. While most companies didn’t experience the dramatic drop-off in revenue that hotels, entertainment venues, and airlines faced in 2020, we all had to reassess our assumptions to manage a once-in-a-century disruption—and the changes and disruptions haven’t ended yet.

Some orgs developed procedures to keep cash flows up and satisfy changing customer demand, all while managing work-from-home teams that used data and analysis to optimize business. And those were the lucky ones.

It’s one thing to assess the data to figure out how to survive during an emergency, and sometimes it’s essential. But making ongoing, dynamic data collection and analysis a part of your business strategy from the jump? Now that’s planning for the unplannable.

Ready to adopt some best practices for continuous financial planning and analysis? Let’s dig in.

Think strategically and act nimbly

Strategic plans used to be the singular North Star for business planning: Senior management and directors would agree on long-term growth and profit milestones, plus how to measure progress along the way. But in today’s unpredictable market, new opportunities crop up a whole lot faster than they used to.

When those new opportunities arise, operations teams (with funds in hand) need to be able to move at a continuous, efficient pace, while still putting KPIs in place to make sure they make efficient progress toward goals.

Hack your timeline with automation

So, how do teams adapt to a changed world? First of all, the finance team is central to continuous planning—and successful planning requires the finance team to measure outcomes and find funds to support new initiatives.

There are two ways to get there: by adding staff, or by automating time-consuming processes.

Automation is often sold as a cost-saving measure. However, from a planning and analytical point of view, the timeliness and accuracy automatioin delivers are more significant selling points, not to mention its ability to eliminate costly human errors caused by overtime, stress, and WFH challenges. (Cat walking across your keyboard, anyone?)

Zoom out with external data

Automating core accounting functions gets finance closer to a continuous close. Plus, when software performs boring but necessary rote work, your talented team can focus on everything else. Include sales and demand forecasts, work in progress, supply-chain analysis, and inventory management, and voilà—you have the foundation for solid planning models in finance and operations.

That’s a strong baseline, but you’ve also got to consider a wide range of external data sources. Accurate forecasts can provide these insights into what could impact business down the line.

The customer is always relevant

Speaking of insights, there’s no substitute for interacting with your customers to inform continuous planning efforts. Bring finance leaders and sales peers together on the reg to make customer conversations a priority.

Quarterly business reviews can also be a helpful time to address challenges and make sure you’re checking in with customers to avoid surprises. As an external touchpoint, launch a survey to get insight into customer attitudes and make sure that communication (among all departments involved) is a two-way street.

Boost scenario planning with analytics tools

Excel enthusiasts, this might hurt a little: It’s time to move away from spreadsheets for regular assessments of plans and models. Sure, spreadsheets can be helpful for short-term organizational tasks, but when it comes to big-picture ideating, choose cloud-based, accessible analytics tools that pair well with remote and hybrid teams.

As you integrate those analytics tools, get ready to see a little magic happen. Seemingly unrelated parts of the business will benefit from this new visibility into strategic and financial plans, and everyone will contribute to making those plans more accurate. Teamwork making the dream work? Check.

Adopt the right tech

As you move toward companywide and continuous planning, make sure your platform does the following:

1. Syncs data. When every system across the business has access to the same data at the same time, true collaboration and faster, more strategic decisions follow.
2. Supports predictive processes. Machine-learning based processes such as what-if scenario planning put data science at the heart of forecasting and let the user add context when necessary.
3. Maximizes flexibility. Speedier modeling of operations and financial use cases means faster leads and nimbler decisions.
4. Supports a modular approach. Allow planning to grow with business requirements.
5. Operates intuitively. Shoot for an engaging interface that makes it easy to input budgets and forecast numbers.

The bottom line

In recent years, figuring out how to constantly manage changing business conditions has been necessary for survival. Today, that rigor—with better tools and processes—is the key to growth.

Companywide planning and analysis require buy-in from every team, but it also brings people, processes, and technology together so that everyone can understand changing opportunities and challenges. The payoff? An edge over the competition and a more united, engaged org.