We’ve all heard the old saying “many hands make light work,” and while it applies to chores around the house, it’s even more practical in today’s business world.
Every day, managers make important financial commitments on behalf of their companies. Some of these commitments may be nominal but others have a true material financial impact. But before any of those commitments can be made, managers must first plan.
It falls on the shoulders of Finance to prepare a budget and plan that accurately represent the organization’s forward moving business activities. For organizations still living in legacy FP&A environments, budget requests tend to come in the form of multiple emails, Excel spreadsheets and PowerPoint presentations. Sometimes they even arrive on paper.
The tyranny of input templates
This is a rotten set-up for Finance, but those making requests aren’t really to blame. The real problem arises from the input templates used in legacy FP&A applications. If you’ve used a premise-based financial planning platform, you’re likely familiar with the tyranny of input templates, which are needed to enter essential planning data such as currencies, entities, departments and accounts into an FP&A system. Often poorly designed and user-hostile, input templates were not designed to be accessible to people outside of Finance. So people outside of Finance don’t use them.
Too many degrees of separation
What, then, are we left with? Overworked Finance professionals who frantically scramble to collect all budget and plan requests, then summarize them, and finally submit them on behalf of the requesting manager. All of this work must be done under tight deadlines, which leaves no room for error or omission – a problem for error-prone legacy FP&A systems.
Clearly, there are just too many degrees of separation from the manager making the commitments and the finance team consolidating the request. You can picture this broken model as a giant funnel. At the top it’s wide open and anyone can make a deposit, and at the bottom are summarized and formatted budget requests. But in the middle is Finance doing all the work.
Solutions for the many, not for the few
Modern, cloud-based FP&A solutions offer a way to rescue Finance from the middle of that funnel. And boy, do most organizations need it. According to recent research from The Hackett Group, the average company spends four months budgeting with legacy technology (Excel spreadsheets or premise-based FP&A solutions). In contrast, consider that companies implementing rolling forecasts with modern BPM platforms accelerate their budgeting process by five to 25 days each year, according to the American Productivity & Quality Center.
Suddenly, your budget request funnel looks very different. On the intake end is each manager’s desk, mobile phone or tablet. Requests are made directly, easily and quickly – with little to no intervention required from Finance. And remember the dreaded input template? The latest applications have re-engineered it with today’s users in mind – it’s visual, in the cloud and works on any device, so no matter where users are, they can contribute. It also provides step-by-step navigation so it’s easy to follow along, uses natural language so managers across the company can participate without being steeped in the intricacies of accounting or metadata, and incorporates intuitive panels to help users identify what tools they need to get the job done.
This technology and approach to collaborative financial planning exists today – and is available for users globally. If your organization is looking to apply “many hands to make light work,” consider a new approach to business performance management to bring your entire organization into the budgeting and planning process. And you too can reap the benefits of accurate, timely financial plans that add up what every company wants: fewer surprises, greater savings and more profits.