Maybe it is the nerd in all of us, but one of the topics I witness financial planning and analysis (FP&A) professionals discussing with the most passion is whether their positions should be called FP&A – or would a better descriptor of their jobs be BP&A (business planning and analysis)? I can honestly say I’ve seen the discussion of this issue get quite heated (though still polite and civil). At roundtables that I have hosted, whether in New York, New Delhi, or New Zealand, this debate usually comes up.
But the point is that the name is a lot less important than the work that we do in intelligent finance organizations. FP&A is not a universal term in the way that accounting, marketing, sales, operations, human resources, or treasury are. If people tell me they work in sales, I can draw a picture in my mind of what they do. This is not often the case with FP&A. Most people usually have no idea what we do, and the majority of people who think they do know what FP&A is usually assume that it has something to do with personal wealth management.
Let’s look at some numbers and see if they provide us with any insights. According to research by Kalish Consulting, 13.7 million people worldwide are involved in “business planning and analysis” versus only 7.2 million people involved in “financial planning and analysis.” Point for BP&A.
The result is reversed when we compare people using the acronyms “FP&A” versus people involved in “BP&A.” About 133,000 people identify with FP&A, while only about 3,000 people identify with BP&A. Point for FP&A. Just to bring in an additional data point, about 461,000 people identify with “financial controller” versus only 263,000 people who identify with “business controller.”
I would argue that using the acronyms FP&A and BP&A are better descriptors due to the broadness of terms “financial” and “business.” But just because the number is larger doesn’t mean the more common or familiar term is the better, more accurate term.
The main argument I have seen for using BP&A versus FP&A is based on how we view the state and purpose of FP&A. Those arguing for BP&A tend to view FP&A as glorified accountants and report generators. When I review the research, however, I don’t see FP&A versus BP&A; I see bad FP&A versus good FP&A.
When one looks at three components of our job: focus, planning, and analysis, I don’t see FP&A versus BP&A; I see where one resides on the FP&A maturity curve. How do you close this gap between where you are and where you aspire to be? By integrating business processes, technology, and people to propel you from one end of the spectrum to the other. The goal is to refocus data and analysis towards customer and product dimensions, as follows.
In closing, I fall on the side of FP&A versus BP&A. We are by definition finance professionals. Where we bring value to our business partners is by leveraging our financial acumen and forward thinking to help organizations run their businesses better.
We will be hosting a number of events all over the world, where we will be discussing and diving deeper into these critical issues and topics.
In addition to our Global FP&A Roundtable series, we hope to see you at Financials2018 EMEA in Prague, October 16–18 and at the Financial Excellence Forum in New York City.
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.