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Modern FP&A: Tools and Trends

July 20, 2022 Evan Webster  
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This blog was first published in 2019 and updated on July 20, 2022.

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Financial planning and analysis, or FP&A, is one of the most important resources at the disposal of any senior manager. Well-run modern FP&A will give decision makers instant access to an overview of risks and opportunities for the organization, as well as analysis at the most granular level of individual departments.

Knowing the actuals and future trends of the organization gives management the closest thing to a crystal ball for guiding their firm. With the rise of advanced analytic techniques and higher demands for data, senior managers and FP&A professionals are feeling the heat to deliver insights that provide useful information – and direct action. Unfortunately, several barriers stand in the way, including:


Knowing the actuals and future trends of the organization gives management the closest thing to a crystal ball for guiding their firm. With the rise of advanced analytic techniques and higher demands for data, senior managers and FP&A professionals are feeling the heat to deliver insights that provide useful information – and direct action. Unfortunately, several barriers stand in the way, including:

  • Manual processes: Spreadsheets have long required people to take data the “final mile,” relying on manual data entry or copy-paste exercises. Unfortunately, people are prone to error. Entering data in the incorrect field or cutting instead of copying data – small mistakes can lead to bad numbers, causing senior managers to make decisions based on bad information. Plus, fixing these errors is costly and time-intensive, taking away from time that could be better spent elsewhere.
  • Data is difficult to visualize and share across departments: Legacy systems make it difficult for finance professionals to share data with stakeholders, and don’t offer solutions to create clear, easy-to-read visualizations.
  • Rigid or incomplete software: Many FP&A tools currently have a very strict framework that require IT assistance or technical expertise to make changes. And while some modern software might have advanced functionality, it often only covers a small fraction of the needs of finance departments. This can lead to shadow spreadsheet systems, additional software that operates behind the scenes to complete tasks that lie outside of the main “solution’s” capabilities.

  • A lack of consistency: FP&A processes should remain consistent from day to day. This helps to ensure more accurate analysis and forecasting. Furthermore, consistent processes make it easier for people outside the financing department to share data, such as department heads.

While FP&A processes are tried and true, many of the constituent parts are trapped in the past. Fortunately, modern FP&A software has taken giant leaps forward to solve these problems.

Financial Planning and Analysis: Tools and Use Cases

Modern financial planning is an art and a science. FP&A professionals gather information, build data models and transform information into clear reports that drive strategy and business decisions.

In reality, FP&A teams can find themselves limited by the tools at their disposal. Rigid software, incomplete data and inaccurate reports can slow down the process and impede a company’s growth. It’s frustrating, sure – but more importantly, it keeps finance professionals from doing the analysis that’s necessary to drive organizational change.


The go-to tool for finance departments around the world is Microsoft Excel. It makes sense. It’s easy to use and easy to learn. It’s invaluable for analyzing multiple data sets and performing powerful calculations, and it allows for ad hoc analysis without the need for a degree in computer science.

Revenue Dashboard from Vena product.

Of course, Excel is not without its limitations. Version control can be difficult to manage, particularly with large data sets or numbers that change quickly. And Excel has difficulty with source system integration, process management and clear audit trails.

Modern FP&A software solutions aim to tackle a number of these pain points. By offering cloud-based FP&A platforms, the best solutions are able to drastically increase functionality, collaboration and data integrity.

A major differentiator? Some softwares try to imitate Excel, while others are built to integrate with it. There is a major difference between integration and imitation. With imitation, you might be working in an Excel-like environment, but it’s not the real thing. At best a light or limited-functionality version of reliable, familiar application, imitation software can be prone to version control, data integrity and a host of other issues associated with a “shadow system” of standalone spreadsheets.

If you’re using software that integrates with Excel, however, you know that you’re using something reliable. Rather than attempts at imitation, it’s far better and easier to rely on the power, flexibility and familiarity of Excel to help you transform your financial analysis and planning process into a true powerhouse.

FP&A Tools: Defining Features

A number of key trends have totally changed the landscape of FP&A. These trends have become so important that they’ve already been adopted by most FP&A tools. At this point, you might call them “table stakes,” since they’re required to “play the game.”


House All Your Data in a Centralized Multidimensional Database

Data integrity is imperative to trust the data you’re looking at. With centralized and controlled data, you’ll have a single source of truth for the entire organization, and a more efficient, trusted and respected finance team. Using a multidimensional database means you’ll be able to slice and dice your data across by any dimension to get a complete picture of your company performance.

Conduct Effective Collaboration and Workflow Automation

Collaboration is better when everyone has access to centrally stored and trusted data. Workflow automation allows finance professionals to spend less time collecting or verifying data, and more time doing value-added analysis. And when everything’s complete, you can send reports automatically to different stakeholder groups for analysis and review.

Integrate Financial and Non-Financial Data

Having access to financial data is key but add in non-financial data, and all of a sudden FP&A professionals can build powerful new models that incorporate more information for better analysis, forecasts and, ultimately, decisions.

Manage Governance and Control

You need the capability to track every change from every user by way of a reliable audit trail. You also need to be able to revert back to previous versions as necessary. Especially for public companies and those in regulated industries, it’s critical to have visibility into the status of each process, along with access to the most current and accurate data. Strong data governance rules help companies maintain order and organization of their data, ensuring the highest possible level of data integrity.

Create Insightful Reports

Trusted, reliable data will get you 90% of the way there, but that data needs to be conveyed in an easy-to-understand format. Having a tool that allows you to build insightful, intuitive and beautiful reports for management is key to succeeding in a modern business climate.

FP&A Tools: Differentiators

While the above are must-haves in order for an FP&A software provider to get their foot in the door, the following features set the best FP&A tools above the rest:

Powerful Modeling and Data Discovery

A strong FP&A tool will allow you to produce more powerful, useful models. By having access to data that used to be siloed in different departments, FP&A professionals can now find inefficiencies that were previously hidden, helping stakeholders find new methods for strategic growth.

Self-Serve Reporting 

Modern FP&A tools allow senior managers to have access to data at their fingertips through illustrative, self-serve and powerful dashboards tailored to their individual needs.

Data Integration

Strong processes set themselves apart by integrating all data, both financial and non-financial, into a single, central repository. Allowing this data to be accessed and analyzed for interpretation in a familiar environment, like Excel, is a best practice that will truly set your organization apart – and it’s a feature that only some FP&A tools provide.

Intuitive, True Excel Interface

With all the version control, data integration and workflow automation features available, even the most powerful FP&A software is only as valuable as it is adopted – both inside finance and across the organization. Adoption is crucial to FP&A software success, and the fastest way to get there is using Excel as an end-user interface. Excel is already everywhere in business, often imitated but never duplicated by “Excel-like” vendors. Full-featured Excel alone is essential for FP&A software success.


FP&A Tools: Use Cases

Full-spectrum FP&A tools are like a Swiss Army knife, serving many functions and roles, including:

  • Financial close management: Routine accounting processes – today part of the full spectrum of FP&A – can be automated, removing the need for manual data entry. Not only does this improve the likelihood that everything will balance out at the end of a reporting period; it reduces the time it takes to close the books, giving FP&A professionals more time to generate the stories and recommendations that push their company forward.
  • Budgeting and forecasting: FP&A professionals can work across business lines to create forward-looking data models, allowing stakeholders to make strategic decisions.
  • Integrated planning: Firms are shifting their budgeting processes, enabling them to work in tandem with one another, no longer siloed off on their own. This can include changing from static budgets to rolling forecasting as well.
  • Financial and management reporting: FP&A software can be used to create management reports outlining shifts in business that could occur through a sudden change in demographics.
  • Regulatory reporting: FP&A software should house data – and provide transparent process visibility – for regulatory reporting, and maintain a history of all the reports that have been used in the system.
  • Agile planning: FP&A software and agile planning go hand in hand, helping you plan with agility, plan with confidence and prepare your business for an uncertain future.

CFOs want to grow their organization. With the evolution of finance tools, FP&A has become an integral part of that process. These are the key FP&A trends driving that growth.

Scenario Planning

The next few years are going to test the best CFOs. With the possibilities of stagnant or tightening interest rates and global instability, financial markets are poised for volatility unseen in over a decade.

The best way to stay ahead in the face of uncertainty is to prepare through scenario planning.


Scenario planning is the process of examining and evaluating possible events that may occur in the future. It involves considering how a number of feasible events may change the value of a business or its cash flow.

With flexible models and good scenario planning, FP&A teams can ensure their organizations are able to respond quickly to changing conditions—from the global stage to the local market.

Data Available Across the Organization

Data moves the world—and in today’s business climate, a company’s success is inextricably tied to data. The integrity of that data is paramount, but it’s no longer good enough just to have quality data. Data must be adopted across the organization—owned by finance in a central, single-source database.

This is advantageous for a few key reasons. By maintaining all data in a single repository, it ensures that the entire organization is working with the same numbers – a standardized story about how the company’s doing. Since the data is housed it in a single place, it can be updated in real time, allowing for on-the-fly adjustments and shared reports that update automatically.


This trend has become a must-have feature for any firm interested in maintaining a competitive edge. In addition to having a centralized database and version control, an audit trail will help with creating and analyzing reports, saving even more time down the road while ensuring data quality.

By consolidating data from across the company, finance can get greater insight into the inner workings of the business, with top-down views of the whole firm that provide visibility into:

  • Which products or services to promote (most profitable) or retire (least profitable)
  • Which features to add/remove/promote on your product roadmap
  • Identifying the next markets/regions for expansion
  • Shifting resources and spend to improve sales and marketing performance

Consumerization of B2B Software

Let’s face it – a lot of enterprise software isn’t what you’d typically call “user friendly.” At the same time, today’s users have come to expect business software that works intuitively and doesn’t need a user’s manual to operate, like the experience they get with today’s leading mobile apps. And some companies are starting to take notice: a new software sector has emerged recently, called B2BC – or business to business consumer software.

B2BC has been driven by the growing acknowledgement that business software should be easy to use, as well as a shift toward mobile platforms. No longer are CFOs or finance professionals tied to bulky desktops; users have come to expect the ability to work remotely with the same level of functionality as if they were sitting at a desk in the office.

When it comes to FP&A tools, poor usability will lead to poor user adoption, or the emergence of shadow systems, with users choosing to “export to Excel” for comfort. All of a sudden, data is decentralized once again, with disparate offline files being used across the organization—the exact thing you were hoping to avoid!

Advanced Analytics

To provide the best experience, modern FP&A software allows finance professionals be able to work ad hoc analysis into their standard models. Modern FP&A software also allows finance teams to:

  • Design reports
  • Explore data
  • Share data
  • Gain new insights
  • Make changes based on data and insights
  • Keep it all in Excel

Flexible and Dynamic Planning

FP&A is moving away from static budgets and shifting to flexible and dynamic planning. One of the clearest examples of this is the growing adoption of rolling forecasts in place of static, annual budgets.

The annual budgeting process, once the gold standard in FP&A, is time- and effort-intensive. And often, by the the time the budget is finalized, the data behind it are already out-of-date and irrelevant. Static budgets are often part of managers’ compensation plans, but this allows them to game the system by setting easily achievable goals and hampering growth.

Dynamic, rolling forecasts are constantly analyzed, then reforecasted every period based on actual data from the previous period. As a result, every reforecast is more accurate than the previous one.


The ultimate goal of this shift – to a 5-quarter rolling forecast, the most common example – is to replace entirely the painful and time-consuming annual budget process. Companies who have changed their budgeting process to a rolling forecast have seen not only increased forecasting accuracy but higher revenue growth as a result.

To incentivize the shift from a static budget to rolling forecast, many of these companies are also beginning to tie budget managers’ compensation directly to the accuracy of their forecasts. Doing so discourages end-of-year spending sprees, overestimating costs to come in under budget and other ways to game the budgeting process; it’s also shows business managers how their contributions match up directly with the company’s strategic goals.

With the right FP&A software, dynamic forecasts can link directly to different departments' software systems and continuously capture data in order to recognize important trends. From here, forward-thinking finance teams can create scenario and “what-if” models to determine the impact of shifting resources and spend allocations, or changing market conditions (such as currency and interest rate movements, new competitive threats or opportunities) on overall business performance.

If completed early, dynamic forecasts can prepare organizations for the most volatile economic storms—from a change in interest rates to a major stock market correction.

One-Tool Solution

There is a strong market and a desire by teams worldwide to help make business processes move better, faster, more efficiently. But most of today’s FP&A tools only cover one of these trends or solve one problem.

Rather than picking a tool that handles one aspect of FP&A – or a number of tools to handle multiple functions – it’s almost always better to choose a single, platform solution that covers the full spectrum of FP&A.

In addition to budgeting, planning and forecasting, look for a tool that also includes management dashboards and reporting, regulatory reporting, workforce planning and the financial close process. Choose a single tool that encompasses all your needs and helps future-proof your FP&A processes for years to come. Doing so provides benefits such as:

  • Ease of use across your company.
  • One system that houses all your data. 
  • A less intensive learning curve.

The Future of FP&A: What’s Next?

Automation, artificial intelligence and cloud solutions are key drivers in the future of FP&A. Tools that promote automated processes will continue to allow FP&A teams to spend less time on repetitive, manually-intensive work and more time helping organizations make strategic decisions.

The use of machine learning in advanced analytics, while still in its embryonic stages, has exponentially greater potential as the amount of available data grows. This could drastically increase the levels of detail or amount of data used by FP&A teams to produce reports and insights, while keeping calculation times near or faster than current speeds.

Machine learning and AI are strong forward-looking tools that will play key roles in FP&A in the future because of their ability to reduce bias, as well as their ability to reduce unknown factors affecting the success of key drivers or points of impact.

Voice functionality may also play a role in making day-to-day FP&A operations easier. Imagine asking: ”Hey Alexa, what are our outstanding receivables right now?” or asking a question to a dedicated Slackbot – rather than running an SQL query.

Connecting to data is becoming easier, and its integration more seamless. In fact, tools like Boomi, Microsoft Flow, Zapier and more are already making it easier to connect FP&A software with everything from email and Slack to JIRA and Salesforce.

Got three minutes? Check out our product demo video and see how Vena can drive faster, smarter, more data-driven strategic decisions.

Good News: What this Means for Finance Teams

All of this is great news for finance professionals. With more efficient processes, FP&A professionals spend less time developing models, and more time analyzing and interpreting the information at their disposal. The shift to full-spectrum FP&A is creating an elevated, strategy-focused role for everyone in finance, all the way up to the CFO.

In-depth management reports on a more frequent basis allow organizations to become more agile and aligned from the bottom up. A holistic plan based on company-wide data allows for greater cooperation between business units and among employees. All of these factors lead to better performance and more successful companies in general—and that’s the true goal of modern FP&A.

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