Ask a sales manager what ABC means and the response, often with a smile, will be “Always Be Closing.” This concept makes sense for the sales manager but unfortunately, many finance managers are “always closing” too – and they’re not smiling about it. The budgeting, planning and forecasting (BP&F) cycle is too often the most dreaded time of the year. A recent report from Ventana Research revealed that the BP&F process “typically eats up 10 – 15% of the finance team’s time, and it takes 5 – 10 months to complete the full cycle in large organizations.” So how does the finance team get anything else done if we’re talking about a 10-month process?
Few organizations are insulated from the challenges of financial reporting and planning. The process continues to cause pain because there are many moving parts that finance managers and planners need to balance and many individuals who contribute to them. We’ve found that many of the finance team’s concerns boil down to the following 2 issues, both of which can be addressed with a dedicated, comprehensive BP&F tool.
1) You’ve outgrown your current process. For some, planning consists of Excel spreadsheets and a notepad. We recently spoke to one $3 billion company that is still managing their planning this way! In a previous post, we looked at some of the indicators for when you need to move on from your current BP&F process: multiple versions of the same spreadsheets used by different people, time wasted consolidating spreadsheets rather than analyzing data, and limited visibility. These are all signs that it’s time to graduate to a corporate performance management solution or dedicated BP&F software (like arcplan Edge), investing in a tool that is centralized, adaptive, and allows you to deliver the value that your business needs. Inefficient data collection and multiple versions of spreadsheets lengthen the BP&F cycle unnecessarily, reducing the value of the entire process.