4 Practical Ways to Streamline Your Company's FP&A Workflows

4 Practical Ways to Streamline Your Company's FP&A Workflows

Brian Kalish 28/01/2022
4 Practical Ways to Streamline Your Company's FP&A Workflows

Financial Planning and Analysis (FP&A) is often a tedious and complex process.

Without the right tools and workflows, you’d be hard-pressed to run an accurate, efficient, and effective FP&A program.

Emerging trends such as scenario planning, the new normal for financial planning analysis, can make it challenging for your company to keep up with the times and gain an edge over your competitors. Fortunately, there are practical ways to make your company’s FP&A workflows as seamless and efficient as possible — and that’s what we’ll cover in this guide. 

1. Leverage Driver-Based Planning 

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Seamless driver-based planning and analysis help ensure your finance and management teams don’t run the risk of flying blind.  

It can help eliminate uncertainty and streamline your FP&A workflows by allowing you to gain early warning signs for better decision-making. It also helps ensure you have the tools, such as the best FP&A software, necessary to react quickly when your business conditions change.  

Essentially, driver-based planning allows you to get those “aha!” moments. For instance, setting up a driver-based plan for your business allows your finance team to monitor your key results actively. This includes relationships among your operational results, people, and finances. 

A driver-based plan’s modeling and forecasting calculations are linked to a more granular level, such as default credit card rates, interest rates, or promotions based on existing information in your company. This allows you to automatically generate greater granularity of information via assumptions-based rules, such as historical actuals or trends. 

You can also modify this (including for “what-if” analyses when necessary). As such, driver-based planning is useful for scenarios such as allowing your FP&A to efficiently determine why your company is missing projections you committed to. 

2. Eliminate Duplicate Efforts

Each of your company departments generally develops its own analytics. However, if you don’t centralize or find a way to integrate everything seamlessly, these various analytics and information can lead to duplicative, conflicting, and incompatible reports and data.  

This can slow down your FP&A workflows and add to your finance and management team’s workload.  

The solution? Eliminate potential duplicate efforts by defining each of your department’s expertise and contributions to the analytic mix. Doing so helps reduce the analytic burden on your finance teams. For instance, you can cut through the noise by working with your business unit proactively.  

You can design joint analysis areas that combine each team’s strengths into a unified report that all units can use and endorse. A good example is allowing your marketing team to take the lead on measuring customer attitudes while your finance department handles running Return on Investment (ROI) figures.

This can reduce duplication in your FP&A workflows and analytics processes. It also helps avoid frustrating your teams and allows for better collaboration and efficiency

3. Redefine Finance Roles in your Company

Centralizing your analytics allows you to leverage scarce talents, improve your operations’ overall efficiency, and use data science to gain a deeper level of insight. 

However, centralizing analytics (and the analytic portion of decision support) comes with potential risks. This includes a loss of business savviness and influence for Chief Financial Officers (CFOs).  

To help counter these risks, you can leverage a hub and spoke model. In this model, your data scientist acts as the hub that performs deep analysis and works with analytics and IT teams.

Your qualitative financial analysts serve as the spokes that take the analyses and recommend them to your business units. This can lead to well-defined finance roles that contribute to seamless workflows. Also, the result is an analytics distribution model that saves your data scientists’ time while providing business-specific viewpoints via your FP&A analysts serving as interpreters. 

4. Invest in your Finance Team

Planning and forecasting can significantly improve your FP&A workflow’s efficiency, but these are only a part of the equation. If you want to supercharge your workflows and drive better results with a bigger focus on insight generation, you’ll need to invest in FP&A talent. 

Put your money on FP&A team members that have a combination of technical savvy, strong communication skills, and intellectual curiosity. 

For instance, having an FP&A staff with excellent interpersonal skills gives you a team member who can take on a more strategic advisory role to your CFO and build trust-based relationships with other business leaders.   

It’s also critical to have team members with advanced technologies and analytics skills to: 

  • Simplify and streamline your complex data analyses
  • Quickly identify trends and consider potential business implications over multiple timeframes and dimensions
  • Do all the above while effectively running your FP&A processes efficiently 

Consider these tips to hone your FP&A staff’s skills and expertise and ensure agile working styles across your teams. 

  • Ensure your finance team establishes a receptive buy-in and greater partnership from your senior management.

    Then, develop an organizational structure that allows forecast analysts and CFOs to have enough proximity to your business. Building this strong link and acceptance can help you enhance communication and decision-making. It can also lead to better efficiency and further drive profitability. 
  • Create rotational programs and provide interim projects outside your finance unit.

    This allows your FP&A team members to generate experience and develop new skills within your business. The stronger relationships and connections this approach nurtures can help your FP&A managers and analysts be more comfortable communicating with other teams. This includes your sales, operations, IT, and marketing teams. Establishing this business proximity for your teams can also help foster trust and improve communication across your departments. 
  • Structure your FP&A for sustainability.

    This can improve your operations’ efficiency, help your company attract talent across various roles, and offer upward career mobility for your talented employees. Also, consider adopting an enterprise-wide model that can incorporate employees in various parts of your business while operating with common responsibilities and roles. Include career mobility to allow your talent to evolve across functions. 

The more developed your finance team members’ talents and the bigger their buy-in, the better they can work to improve and streamline your FP&A workflows.  

Speed Up your FP&A Workflows to Gain Better Results

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Invest in FP&A practical methods, best practices, and modern technology to improve your workflows and overall operations’ efficiency. 

Doing so can also help your FP&A teams navigate rapid shifts in your business seamlessly, develop models to predict possible outcomes, and manage change at your company’s speed to ensure success. 

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Brian Kalish

Finance Expert

Brian is Founder and Principal at Kalish Consulting. He is Former Executive Director – Global FP&A Practice at AFP. He has over 20 years of experience in Finance, FP&A, Treasury and Investor Relations. He previously held a number of treasury and finance positions with the FHLB, Washington Mutual/JP Morgan, NRUCFC, Fifth Third and Fannie Mae. He has spoken all over the world to audiences both large and small hosting FP&A Roundtable meetings in North America, Europe, Asia and soon South America. Brian attended Georgia Tech, in Atlanta, GA for his undergraduate studies in Business and the Pamplin College of Business at Virginia Tech for his graduate work. In 2014, Brian was awarded the Global Certified Corporate FP&A Professional designation.

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