Providing Visibility & Agility: The Key Components of Success in Planning, Budgeting, and Forecastingby Nick Castellina
In my previous post, I discussed the role of spreadsheets in financial planning, budgeting, and forecasting. My key conclusion was that organizations need more substantial technology to facilitate these processes through automation. What I did not discuss was how these technologies provide greater visibility into the data that is essential for successful decision-making as well as the importance of utilizing this data to create forecasts that constantly reflect current business conditions. Today I would like to discuss these themes, but let’s first take a step back to why they are important.
Aberdeen’s 2013 Financial Planning, Budgeting, and Forecasting survey illustrated the top pressures hindering planning processes (Figure 1).
Figure 1: Pressures in Planning, Budgeting, and Forecasting
Source: Aberdeen Group, January 2013
Highlighting the importance of agility, organizations are pressured with volatile markets that make it extremely difficult to forecast effectively. This is compounded by the fact that 25% of organizations reported that their current budgeting process is too long and resource intensive. So organizations are spending all this time and effort, and by the time the planning process is complete, the output is already based on old data.
The business intelligence tools of yesterday were slow, expensive, difficult to use, and required long implementation times. Well…let’s be honest – many of today’s BI tools are still this way. I find it amazing what some organizations will put up with when it comes to BI. Best-in-class organizations, however, are going after agile BI like never before. Agile BI enables “flexibility by accelerating the time it takes to deliver value with BI projects,” according to TDWI. That’s the formal definition, but what does agile BI look like in practice?
The concept of agile BI has made users more demanding in what they expect out of a BI solution. They want information in their hands faster so they can make decisions in a timely manner – that is, they want to make decisions based on today’s data, not data that’s 3 weeks old. They want simple, intuitive self-service BI tools that allow them to manipulate and analyze data themselves, without having to wait for IT. And they want BI that’s implemented quickly so they see faster time-to-value.
So agile BI is about timely information, self-service analysis, and rapid implementation. But it’s also the key to increasing BI adoption at your organization. Let’s explore why.