Ready for the year ahead?

Financial planning and analysis has taken a front seat in organisational importance, expanding its area of influence with cross-departmental implications. Accurate, frequent and integrated business planning has become critical as geopolitical tensions, worldwide inflation and supply chain disruption continue to reshape the global economy. Keeping track of these variables can be mindboggling at best, making the accountant’s job even more crucial than ever. A lot of challenges have unfolded in the last twelve months, bringing both challenges and opportunities for better business performance. These are the top seven trends in financial planning and analysis.

1.Adaptability is the new stability

Nothing has taught us how to pivot better than the last three years. In times of great uncertainty, technology will support organisations to quickly adapt to change through its ability to provide easy access to real-time insights. Organisations that have quickly adopted technological solutions and have accelerated digitalisation initiatives are well positioned to take advantage of the time and cost savings these endeavours bring.

While uncertainty is growing, organisations can adapt to these changes in multiple ways through more frequent forecasts; closer collaboration between the business and financial planning and analysis teams; the ability to model multiple scenarios; and integrating external data sources. In short, adaptability will be the new stability in 2023.

2. Integrated business planning will give rise to more meaningful collaboration

Integrated business planning is the next generation of decisive planning, with technology-driven cross-functional collaboration at its core. The benefit of integrated planning is its ability to align departments, while improving compliance and controls around the planning process.

Integrated planning links financial targets to operational drivers − the activities that each department actually carries out on a day to day basis. Users compare the actual activities with those planned, and drill down below the KPIs to understand why this is happening. Combining performance monitoring with integrated planning means you can rapidly take action. Planning is not rigid. You need self-service modelling to be able to customise planning rules and respond to growth and change.

Financial planning and analysis is evolving beyond finance to integrate information from across the entire organisation and streamline collaboration between people and technology.

Organisations that adopt an integrated approach can create a unified plan activated by all the data that matters in finance, sales, marketing and HR.

3.Simplified planning enables a culture of decisiveness and confidence

To lead resilient organisations, decision makers must be confident in their plan so they can act with accuracy and precision. The ability to make decisions with confidence and speed is a goal that many leaders strive to achieve. However, confidence comes not simply from having data, but from a meaningful understanding of what that data means for teams and organisations. No matter how much data you have, simplified planning will be key to achieving decisiveness.

4.Artificial intelligence is everywhere in the office of finance

We are utterly immersed in AI, and it is already impacting our lives in powerful and exciting ways. A recent study by the Business Application Research Centre (BARC) revealed that in the span of just two years, the percentage of organisations relying on predictive planning technology has increased elevenfold to 44% (see bit.ly/3IEs4G2). From a technical perspective, AI is stable, mature and ready to support the office of finance. From a strategic perspective, it is helping CFOs to provide the sophisticated insights that business leaders and investors are demanding.

The reality for many organisations is a finance operation that concentrates on traditional practices with costly manual processes still in place. Automation is critical to addressing many key finance pain points, particularly if operations are serious about leveraging approaches such as AI to help power their digital business initiatives. That’s why accountants in particular need to drive their own automation agenda, not just across their core planning, budgeting and forecasting activities but also across their endto-end financial planning and analysis activities, including their complex consolidation processes.

5.Technology is a talent magnet

According to a study by Future Forum, embracing digital tools is a key component in building connections with employees (see bit. ly/3GSkRjt). People who work at companies they consider technology innovators continue to show higher employee experience scores in all categories, including 1.5x higher scores on productivity, 2x higher scores on a sense of belonging, and 2.5x higher scores on overall satisfaction. Emerging finance professionals want to have the best tools available to them so they are positioned for success. Providing the right solutions to do that will increase the likelihood of employee engagement for everyone.

6.Financial planning and analysis professionals sstrengthen their roles as business partners

For an organisation to be resilient, it must have adaptable planning capabilities. As a result, financial planning and analysis professionals will play a strategic role in maintaining these capabilities throughout the enterprise. These turbulent times require solutions that enable adaptable planning not only in in finance, but across other organisational functions such as sales, operations, HR and supply chain. Moving from siloed to integrated business planning allows teams to work smarter and collaborate better and more decisively.

According to Gartner, finance leaders cite managing financial information as their key task, with managing business performance a close second (see gtnr.it/3W3qFMt). However, CFOs particularly see a growing need to extend their financial planning and analysis capabilities out across the enterprise, so that budgeting, planning and forecasting activities can include key corporate functions such as sales, supply chain, HR and IT to enable a truly integrated reporting approach. Adopting this broader, more integrated approach means that both finance and business leaders can trust their figures to support real-time decision making.

7.Geopolitics will continue toexert its influence over inputs and planning

Global organisations need to consider geopolitics, especially given the impact the war in Ukraine continues to have on the global economy. In this environment, countries can take several different approaches to how they will respond and engage on the world stage, and this can impact organisations depending on where they are based and where they conduct business activity. Finance professionals can partner with the broader business to determine which geopolitical scenarios could impact their organisation’s business activities, customers, revenue, office locations, employees, etc. and build these scenarios into their planning process.

Summary

Organisations that are positioned with superior planning capabilities will be able to adapt quickly to the changing business environment, thereby simplifying the overall planning process. Organisations that embrace proper digital solutions will not only have happier employees, but a better chance at business success in 2023.