To be successful, organizations must be able to provide faster, more predictive analytics and be able to pivot “on the fly.”
This means that highly complex business environments need better financial planning and analysis (FP&A) solutions rather than static, traditional planning and budgeting tools.
Old school tactics and tools (think Excel spreadsheets) rely on manual inputs across multiple departments. The result is that finance team members waste too much time entering data, correcting errors, and compiling information.
Not only does this hamstring the planning, budgeting, and forecasting processes, it also prevents finance teams from making critical business decisions in real-time.
Instead, organizations should rely on an agile operational procedure that automates processes, efficiently provides information to outside auditors and stakeholders, and quickly performs a value-added deep analysis.
If an organization’s current process means that one or more people must spend the better part of a day simply gathering data, then the CFO has lost the ability to make quick and accurate decisions.
CFOs should ask themselves, “What is the true cost of not having the information I need when I need it? What issues — and which opportunities — am I missing?”
Agile Is Key to Business Growth
The role of the finance function is to deliver timely analysis and insights to help business leaders make strategic decisions, forecast their organization’s future performance, and recommend action backed up by data to prepare for and respond to change.
Enterprises that thrive in a constantly changing environment do so by being agile, which enables them to rapidly adapt to change.
A CFO who wants to help the business executives navigate through these tumultuous times needs to run an agile finance function so they can respond to threats and opportunities in real time. Rather than a centralized finance team, cross-functional teams should work with business unit leaders and other stakeholders to stay abreast of spending, and monitor the financial performance and strategic needs of the organization.
An agile finance function is critical to creating an agile organization, thereby improving the overall performance of the organization. In fact, companies with agile finance functions increase revenues 3.2 times faster than organizations without them, according to the TCS CFO 2020 Study.
Agile finance teams can have a major impact on their organizations by focusing on results rather than process, as well as by helping leaders make the best decisions for the business.
Therefore, CFOs must deploy an intelligent finance operating model that uses data, applied intelligence, digital technologies, as well as human talent to provide the speed necessary to help their organizations succeed.
To enable informed decision making, agile CFOs must bring together data from across their organizations to present a thorough, easy-to-comprehend view of the business’s performance. These agile CFOs understand how to communicate change and how that change will affect stakeholders today and in the future.
Agile Helps CFOs React to Change
Agile finance business planning allows CFOs to help their companies react to change quickly and intelligently: finance teams are able to identify major performance trends, analyze the impact of these changes on their organizations’ bottom lines, and quickly adjust their plans to deal with these changes.
Agile CFOs understand that change is inevitable, so they might as well prepare for it by implementing modern processes that let them adapt accordingly. In addition, agile CFOs also understand that sooner or later their plans will need revision; however, as requirements change, having the right processes in place will allow them to pivot early.
In terms of their finance planning processes, agile CFOs must be proactive, considering leading indicators to get an idea of the changes that may be coming and what those changes might mean for their organizations. To do so, every week they model various scenarios in real-time using known variables and forecasting.
Agile finance teams give C-suite executives the necessary data to make long-term, sound business decisions, and provide them the necessary insights to pivot quickly and effectively.
To be more strategic, CFOs and their finance teams must adopt an agile operational methodology if they want their companies to prosper.
An agile cloud-based FP&A tool enables CFOs to make better decisions and develop more accurate forecasts. The right software lets CFOs and their finance teams easily enhance their financial planning and reporting processes.
Agile FP&A software consolidates data sources into one source of truth, and provides dynamic reporting and analysis to offer insights into finances, profitability, and more.
To be more strategic, CFOs and their finance teams need agile cloud-based FP&A software that streamlines everyday financial reporting, forecasting, planning, and analysis. A scalable, agile FP&A tool grows with the needs of their organization and affords CFOs a complete picture of the business in real-time. CFOs can draw insights from the data to make fact-based decisions, boost their organizations’ profitability, and react to change on the fly.