Financial Planning & Analysis

With volatile market conditions, slim interest margins and a race to deliver digital products and services, it's time for FP&A digital transformation in the banking and credit union industry. Legacy on-premise budgeting solutions or simple spreadsheets create siloed data, endless folders full of Excel spreadsheets, outdated historical data and pose risks to compliance and data security. As a result, FP&A professionals spend a lot of time chasing after numbers instead of analyzing them, hampering their ability to drive agile planning and timely, strategic decision-making. Between 2010 to 2019, there was very little change in the amount of time spent gathering data and administering the FP&A process (77% vs. 75%) and the amount of time spent providing value-added analysis (23% vs. 25%). In the post-pandemic world where prime rates and even business models can change overnight, banks and credit unions need to decide if they want to survive with the status quo or thrive with quick and accurate decision-making capabilities. For many, the answer will be clear: It's time to invest in an FP&A and extended planning solution for banking and credit unions that will build resilience, agility and executional alignment into financial as well as operational planning processes. This guide will outline best practices for modernizing core FP&A and extended planning processes to help your bank or credit union choose the right solution built for and owned by finance teams in financial services. Best Practice 1: Connect Financial and Operational Data To Eliminate Silos and Create a Complete View of the Business Accurate, timely planning and decision making starts with the right data. Unfortunately, banking data is often stored across a variety of separate systems, including core banking, enterprise resource planning (ERP), general ledger (GL), asset liability management (ALM), funds transfer pricing (FTP), human resource information systems (HRIS) and fixed asset systems. If your bank or credit union has grown through acquisition or completed a recent merger, you may have multiple versions of each system, compounding the challenge. To cut down on time spent gathering and administering data from all these different sources, start by integrating them all into a single source of truth. This single, central data model should contain all the data you need to facilitate your financial planning, analysis and reporting processes in one place—no chasing required. Best Practice 2: Automate Your Workflow Management Processes To Make Time for Analysis and Collaboration FP&A professionals can't afford to be spending their time manually tracking tasks, managing team member progress and verifying the accuracy of their data. Not only are these manual processes tedious and inefficient, they are error-prone and often result in a lot of unnecessary back and forth. To refocus time on high-value activities while keeping workflows on track, automate processes such as emailing out spreadsheets, manually aggregating spreadsheet data and following up with people. When you automate workflow management with an FP&A and extended planning solution, your team can spend more time analyzing and collaborating with increased confidence in the accuracy of their data and plans. Best Practice 3: Incorporate Scenario Planning Into Your Process To Be Agile and Prepared for Change With intense pressure to react to real-time market indicators, FP&A teams are under strain to analyze "what-if" solutions in hours rather than days or months. To quickly adapt to market changes, enable scenario planning within your planning templates and say goodbye to countless and disconnected Excel models. Connected scenario planning capabilities support fast, agile changes to key drivers such as prime rates so that you can see immediate impacts on margins and profitability. To facilitate better what-if and scenario analysis, leverage an FP&A and extended planning solution that supports multiple versions of plans. This way, your bank or credit union will never be caught off guard by a rate adjustment—or a pandemic—ever again. Olympia Federal Savings and Vena With Vena, the community bank cut budget consolidation times by 50%, generated net interest margin forecasts on demand and accelerated monthly financial reporting to 30 minutes. Best Practice 4: Use Pre-Configured Logic and Templates Built for Banking and Credit Unions To Quickly Start Driving Agility and Growth Banking and credit unions have unique planning and regulatory needs—but most planning systems aren't built with banks and credit unions in mind. A one-size-fits-all financial planning system usually only offers basic budgeting modules, even though banking financials are anything but rudimentary. A complete planning platform owned and operated by finance can help you manage key banking indicators, such as interest rate assumptions, calculation logic and run-on/off planning across your portfolio of lending and deposit products. With a complete planning solution pre-configured for banks and credit unions, you can leap ahead of the competition who are struggling to make generic solutions fit complex banking logic. Best Practice 5: Support Your Team With Software Everyone Will Want To Use To Plan With Intention Across the Business Move away from centralized budgeting and get users from across the organization involved in planning to help increase accuracy and accountability. To get everyone engaged, use an FP&A and extended planning solution that connects data, processes and people in a way your team wants to work. If onboarding and change management is too complicated, your team won't trust the solution, or use it, and will resort to using their own offline, disconnected Excel models. Maximize engagement and ROI by selecting an FP&A and extended planning solution that is user-friendly, intuitive and has everything your team needs to get on board. More FP&A and Extended Planning Criteria To Consider for Digital Transformation for Banking and Credit Unions In addition to the five best practices for FP&A and extended planning solutions, here are a few more features and tips to consider to make the right choice. Presentation Power Review dashboards and decision-ready reporting capabilities to ensure you’ll have all the insights needed to make quick and accurate decisions. Onboarding Process Make sure you can get the solution up and running quickly—without a lengthy setup—and that it’s easy for users to adopt. Ability To Scale The right solution should grow with your bank or credit union. Can it support other business processes or will you need multiple-point solutions for complete planning? FP&A Processes for Banks and Credit Unions (Made Easy) See how Vena’s Pre-Configured Solution for Banks and Credit Unions integrates all the templates, data models, source system data and business logic needed to meet your organization's specific business and industry requirements.

The banking landscape is more challenging than ever before, with factors such as increasingly tight margins, escalating customer demands and fierce competition at play. Plus, as interest rates continue to fluctuate, finance leaders are under pressure to lead the charge in searching for new and innovative ways to fund growth. Why Agile Financial Planning Is Critical to Banks and Credit Unions In 2020, 50% of consumers interacted with their bank through mobile apps or websites at least once a week, compared to 32% in 2018. With bank interactions moving online in today's post-pandemic world, the race is on to deliver the right mix of digital banking products—despite the price tag of new development projects. Banks that can’t keep up with customer expectations risk losing market share to newer, nimble players who are unrestrained by the costs of transforming legacy systems. To meet immediate operational needs and set the groundwork to achieve future goals, banks need an accurate view of all their financial data and the ability to quickly shift plans based on profitability, capital demands and market conditions. However, to unlock this agility and gain a competitive advantage, banks will first need to solve four key challenges: Challenge 1: Staying on Top of Actuals and Profitability Changing economic conditions have forced banks to increase interest rates, cutting into profit margins. In 2020 alone, U.S. bank profits fell 36.5% from the prior year. For regional banks with smaller loan portfolios, it can be especially challenging to maintain industry-standard profitability when approximately two-thirds of their revenue comes from interest income. In 2020, U.S. bank profits fell 36.5% from the prior year. To gain an accurate view of profitability, data needs to align across departments, branches and lines of business. But, product-level data is often spread across core banking, enterprise resource planning (ERP), asset liability management (ALM) and other source systems, making product profitability analysis challenging. Between ERP, ALM, general ledger (GL) and human resource information system (HRIS) data, it can be impossible to find the numbers needed to keep everything in check. And when margins are slim, there is little room for error.   Challenge 2: Adapting to Customer Demands While fluctuating interest rates are slashing innovation budgets, customers are driving demand for new digital banking products and experiences. According to a survey by the Boston Consulting Group conducted in 2020, 24% of consumers planned to use bank branches less—or stop visiting them altogether—after the pandemic. 24% of survey respondents plan to use bank branches less or stop visiting them at all after the pandemic. With this in mind, it's clear that banks need to respond with next-generation online banking products and services or risk losing market share. Studies show customers are willing to switch banks for better digital products—31.4% of local and regional bank customers would be at least "somewhat likely" to switch to a bank that offered a better mobile card app. In the race to meet customer expectations, finance teams can’t afford to be spending time on operational tasks like manual data consolidation and reconciliation. Instead, their time should be spent strategically planning and forecasting to make sure they can cover operating costs while funding digital transformation projects. Unfortunately for many banks, siloed legacy systems and ad-hoc integrations slow down innovation. But in today's increasingly competitive environment, seamlessly connected data is needed to transform both the front-end and back-end of consumer digital banking experiences. Olympia Federal Savings and Vena With Vena, the community bank cut budget consolidation times by 50%, generated net interest margin forecasts on demand and accelerated monthly financial reporting to 30 minutes. Challenge 3: Improving Stakeholder Collaboration The impact of fluctuating interest rates on net interest margins and the growing technology costs tied to the development of digital products are adding to the pressure for banks to consolidate through mergers and acquisitions. Regional consolidation can quickly boost a bank’s deposit rate, while cross-country consolidation can help mitigate risks tied to the economic markets in any particular area. With scale and cost savings, consolidated banks can improve profitability. But consolidation has its own complications. Branches scattered across various geographies and grappling with disparate data issues need to be able to analyze numbers in one place while meeting different regional regulatory requirements. In addition to creating one single source of truth across disparate systems, banks also need to create new processes to work together to get the right data to the right stakeholders in the right way—and in a timely manner.   Challenge 4: Adapting to Changing Market Conditions So what happens the next time there’s a crisis? One of the biggest lessons to take away from the turbulent times we've experienced over the past couple of years is that banks need to be primed and ready to manage change. As we've seen, conditions can shift overnight—from interest rates to regulatory requirements and even entire business models. Banks need to be ready to react to preserve everyday business operations and business continuity. According to Accenture research, when firms are agile, they are more than twice as likely than the average organization to achieve top-quartile financial performance (55% versus 25%). Agile firms are more than twice as likely as the average organization to achieve top-quartile financial performance (55% versus 25%). To prepare for change, scenario planning is key. For example, financial teams should be able to make fast, nimble changes to key drivers—like forecasted prime rates—so they can see immediate impacts on margins and profitability. By considering different possibilities for the future, banks can become more resilient and less susceptible to costly business interruptions.   How Banks and Credit Unions Can Achieve Financial Planning Agility With Vena  Vena for Banks and Credit Unions gives your finance team complete planning and analysis capabilities within one platform built to meet the unique challenges of the banking industry. Access Real-Time Insights To Improve Decision-Making Accuracy Set up your finance team to drive timely, data-driven business decisions without all the manual effort. Vena connects your source systems and automates data integrations to help finance teams back up business plans with accurate, real-time data from all relevant sources. Focus on Innovation To Enable Growth Free up your team's time to focus on strategy—not reporting. Vena integrates your GL, Core Banking, ALM and FTP data sources into one source of truth so that finance teams can stop chasing after the details and look ahead at the bigger picture instead. Streamline Workflows To Enhance Collaboration Set up your finance team to drive timely, data-driven business decisions without all the manual effort. Vena connects your source systems and automates data integrations to help finance teams back up business plans with accurate, real-time data from all relevant sources. Become Resilient To Adapt to Changing Market Conditions Create best and worst-case insights using what-if and scenario modeling capabilities. Vena connects your models, so you can plan for any scenario using rolling forecasts, driver-based forecasting and top-down forecasting.   Financial Planning for Banks Made Easy Learn how Vena’s pre-configured solution built for banks and credit unions integrates all the templates, data models, source system data and business logic needed to meet your organization's specific business and industry requirements.

This blog was first published in 2019 and updated on July 20, 2022. FP&A software powering your plan to grow Drive smarter, more data-driven business decisions with numbers you can trust. 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.   Multiple data sources: Too often, data is siloed, spread across multiple departments and multiple software systems. This can make data reconciliation difficult, and with multiple sources, the integrity of the data itself can be called into question: who has the true, final data set?   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. 1 Financial Planning and Analysis: Tools and Use Cases 2 FP&A Tools: Defining Features 3 FP&A Tools: Differentiators 4 FP&A Tools: Use Cases 5 Financial Planning and Analysis Trends 6 The Future of FP&A: What’s Next? 7 Good News: What this Means for Finance Teams 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. Excel 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. 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. See how the Cardinals saved entire days worth of time and gained a more proactive, strategic outlook for the office of finance. 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. See how a familiar Excel interface led to easier and faster user adoption at Partners in Health. 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. Learn how iPSL made reporting 66% faster, from 6 weeks to 10 days. Financial Planning and Analysis Trends 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. Read how Meats By Linz saw 3 years’ worth of expected e-commerce growth in just 3 months during COVID-19. 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. Are you beyond the 3-minute demo stage? If you’re ready to speak to someone about options for your specific FP&A needs, book a demo today.

You probably know him as “The FP&A Guy.” For nearly 15 years, Paul Barnhurst has been a leader, influencer and educator in the FP&A community. "Talent and labor”—that’s been the CFO’s highest priority this year. In a 2021 Q4 report, 60.7% surveyed CFOs ranked it among their top three concerns heading into 2022. Now we’re halfway through and those priorities probably have changed for some CFOs. While declining stock prices, rising interest rates and supply chain issues have stopped growth for many businesses, for others, it has meant a larger talent pool as great candidates enter the job market. Last month, I wrote about hiring an FP&A “magician” and the seven emerging FP&A roles. I discussed the importance of assessing your business’s objectives, the skills needed to accomplish those objectives and my six-step framework to address your FP&A team’s resource needs. The last step in the framework is developing a hiring plan. In FP&A, we need to ensure our business makes the best decisions on deploying the next dollar—and that our team is aware of this and how to do it. In this blog post, I’ll cover six FP&A interview questions that can help you understand your candidates. These questions can help you determine which candidates to advance in the interview process. (And if you’re a candidate, well, have your answers to these FP&A interview questions ready for your next interview…) 1. What Have You Learned From Your First and Last/Current Jobs? This question helps us understand what’s important to them. By hearing their most memorable learnings and the career accomplishments they’re most proud of, we find out their values and motivators. We can learn a lot about what drives them on a daily basis to success. 2. On a Scale of 1 to 10, How Would You Rate Yourself in Excel? Why? We want to know if they can honestly assess their own skill set. Their answer will, of course, trigger follow-up questions at which we can then “drill down” and learn more about what they can—and like to—do in Excel. This question can also tell us about their creativity and possibly give them an opportunity to show their passion for data analysis and everything spreadsheets. If necessary, give an Excel assessment to ensure they have the Excel skills required to perform the job. 3. How Have You Used Data Analysis Tools To Generate Valuable Insights and Make Informed Decisions? I’ve heard some companies ask candidates about which tools they’ve used. I prefer to ask how they’ve used the tools they’ve been given. Focus on the tools that have been made available to them, because not every candidate has had equal access. This lets us learn about not only their experience, but also their resourcefulness and how they’ve maximized ROI with what they’ve been provided. Level Up Your Financial Modeling Fundamentals Learn from “The FP&A Guy” Paul Barnhurst the five questions you need to ask when you have too much information. 4. How Would You Forecast a New Product/Service You’ve Never Sold? Ask a scenario question. This is only one example of infinite scenario questions you can ask, but always provide an ambiguous scenario. Don’t make it vague, but rather loosely defined. This question helps us understand how they think through ambiguity in finance. No right or wrong answers here, but you can learn so much about their thought process and how they arrive at assumptions and other decisions. 5. How Do You Approach Interactions With Stakeholders Who May Not Have as Much Finance Knowledge as You? We need to see how they communicate. It used to be FP&R—financial planning and reporting. Today, in FP&A, we need to be strategic business partners to the company, so everyone on your team needs to be able to communicate with the business. One of the most important skills lacking today in finance is communication. It’s a “soft, non-technical, essential” skill. Because we need to work cross-departmentally with product, sales, marketing and other functions, they must have the ability to communicate, with respect, and if needed, layperson terminology. This also means storytelling and influencing—they need to help these teams understand FP&A processes at a basic level and your team’s decisions. This question tells us if they can support our team in serving as that strategic business partner and providing real value to the company. 6. How Have You Worked on Improving Your Skill Set in the Last Year? This question gives us insight into their openness to learning. We want to see that they’re motivated to learn, grow and do more. I love teaching and mentoring—it’s why I share and post on LinkedIn to help others in the FP&A community grow—but it’s especially important for your team and company to hire someone who wants to continue growing within the company. Hiring is hard, especially right now, and what’s harder than hiring? Re-hiring. FP&A Interview Questions These are six of my favorite FP&A interview questions. They can tell you about your candidate’s values, motivators, self-awareness, creativity, resourcefulness, thought process and communication skills. Now you can increase the chances that the candidates—at least the ones you advance to the next interview stage—can support your FP&A team in making the best decisions on deploying your company’s next dollar. Modern Finance Skills Watch “The FP&A Guy” Paul Barnhurst’s Excelerate =SUM(it) 2022 session, Contemporary Skills for Strategic Finance Professionals, on Plan To Grow to learn more about the skills needed in today’s FP&A.

Amid today’s extremely volatile business environment are the reverberations of a pandemic, a supply chain crisis fueled by that pandemic (which has been exacerbated by the war in Ukraine) and rising interest rates and inflation. Oh, and then there’s also the Great Resignation. This volatility has triggered constant change and increasing complexity in the marketplace, forcing FP&A teams to move away from “planning as we know it”—a.k.a. the traditional budgeting and planning cycle—to a new planning paradigm fit for the “next normal.” This likely comes as no surprise to you—traditional annual budgeting is too time-consuming and not timely enough in today’s business environment. Across data gathering, KPI creation, forecasting performance for the next quarter, year, three years or five along with constant revisions, it can take months to finalize the budget—which, these days, is likely to be out of date after month one, let alone month 12. All in, it’s a daunting task that takes away from the finance function’s ability to focus on value-adding activities—such as interpreting data to support agile, business-wide decision making. Agility, flexibility and a strategic mindset that accounts for the operational environment are vital in order to plan and thrive. In Planning [as we know it] is Dead, the latest e-book from the Business Partnering Institute (BPI) which explores a new planning paradigm for the next normal, the authors—Anders Liu-Lindberg (CMO and COO), Michael Lykke Bülow (Founder and Managing Partner) and Benita Ulrichs Nilsson (Partner and CFO)—wanted to better understand the current state of how companies are managing planning in this volatile business environment. They spoke to Vena VP of FP&A Tom Seegmiller to learn more about how organizations should approach planning in this time of heightened uncertainty and rapid change. "Planning is constantly evolving at this point in time," said Tom. "It is in a state of flux. Since the pandemic hit, you have two different camps: Companies that have chosen to evolve, adapt and understand that the environment they are operating in is different, and those that have failed to make the changes." Tom’s ultimate watchword for planning in the next normal? Adaptability. In this blog post, we’ll share five of Tom’s tips on how you can adapt your planning process to help your business navigate today’s volatile business environment: 1. Get Granular With Driver-Based Planning Driver-based planning allows you to achieve planning agility with greater granularity, working with budget owners, breaking down key business drivers and accounting for how changes to those drivers will impact financial and operational performance. “The more people are in there and reviewing results, the better they understand those drivers, those metrics and the levers that you can pull within the business to change outcomes. They're better informed to plan for the future,” said Tom. While it doesn’t guarantee your success when used alone, and can be counterintuitive and time consuming (it’s not easy to establish because it requires a deep understanding of your drivers), driver-based planning is valuable for your scenario analysis and agile responsiveness, both of which traditional budgeting lacks. You can still benchmark your performance, but now you can adjust for any changes in activities and resources. 2. Plan for Potential Outcomes With Scenario Analysis "Those that have continued to adapt … are probably doing scenario planning," said Tom. If you’re doing driver-based forecasting, scenario analysis allows you to be better prepared for changes in your key activities and resources. One benefit of preparing what-if scenarios—whether it’s just best case, base case, worst case, or more scenarios than the best practice minimum of three—is that, as you’re forecasting these scenarios, you’re also exploring possible responses to possible positive or negative events. From effective risk management to more proactive financial and operational planning, scenario analysis allows you to see how different internal and external inputs might cause business key performance metrics to change so you can help your stakeholders make proactive planning decisions that account for a range of possibilities. 3. Seize Extraordinary Opportunities With Rolling Forecasts Rolling forecasts came to be as a way to address the issue of timeliness inherent with traditional budgeting and have gained popularity over the past several years. They’re effective for responding quickly and seizing opportunities and incorporating them into your planning amid market changes. "When you're updating your rolling forecast and you see the triggers or levers or milestones that you had laid out in your scenario forecast, you already know which general direction you're going to head in. You've vetted it with your executive team, you've stress tested your ranges and the what-if scenarios, making it easy to adapt,” Tom said. They aren’t perfect, though—you can run the risk of rolling forecasts becoming an endless budgeting cycle which can also inhibit the finance function’s ability to focus on value creation. When implemented effectively, how often should you update your rolling forecast? “ ... Probably quarterly updates, being realistic," said Tom. "You don't want to have knee jerk reactions every day or week. But you do want to monitor over a relatively short period of time and then adapt for one of two things: either risks that are prevailing in your business that you want to mitigate against, or extraordinary opportunities in the market that you weren’t aware of when you planned. That annual budget that you set at the beginning of the year becomes dated and stale. And there's so many elements and factors that people sometimes can't predict what's going to happen in the next hour. So why would you think you're going to be right over the course of the next year?" 4. Drive Cohesion With Collaborative Planning “When you think about the ecosystem of teams that work together—data analytics teams, CPM functions, FP&A teams—I would bring them all under one roof,” Tom said. Their roles are fundamentally connected, and with greater cohesion, they can work together to better inform your planning. Involving your business leaders and budget owners will not only improve planning efficiency, it will also increase the value your planning process provides. Planning more collaboratively can generate deeper insights than if your teams were to forecast without the involvement of, for example, someone who oversees drivers. “You've gotten more cohesion amongst these processes,” said Tom. “You're thinking about both the upstream and downstream effects of data, you've probably got more consistent leveraging of technology, generating efficiency out of the process, and you've thought about it together collectively as one team, enhancing the insights.” 5. Break Down Long-Term Planning Into Smaller Steps “ ... Start out with, ‘Where is the organization going to be in five years?’” said Tom. “I try to think about our process evolution to get to where we would need to be in five years. As you shift out a year, you're still asking the same question, ‘Where should we be in five years?’ This is a constant evolution.” Breaking down your long-term planning into smaller steps can make it more manageable. While five-year forecasts belong in the old paradigm of planning, they can support your goal of planning adaptability and agility. “You're not necessarily going to notice the progress on a daily basis. But if you reflect back, a quarter later, or six months, a year later, you're going to see the sum of all of the little steps added up to something meaningful on your journey towards planning excellence. But of course, after five years the organization will have evolved. It's going to keep growing and scaling and morphing into something new. What you're targeting is planning excellence at the time, and being ready for that next state of evolution of the company.” A New Paradigm for Planning in Uncertainty In Planning [as we know it] is Dead, the authors explore a new paradigm for planning fit for the volatile realities we now face—one that harnesses Tom’s approaches to enable an agile, iterative, business-wide planning process that focuses on the whole business and its strategic needs. This new planning paradigm puts finance at the heart of strategy, leveraging three planning pillars—reporting on performance, real-time strategic tracking of key assumptions and predictive analytics—to create the most accurate view possible of the future. And this new paradigm features full engagement and understanding from key organizational decision makers and ensures that planning is a value-added activity in and of itself that enables businesses to react to new opportunities or changes in today’s volatile business environment. The e-book looks at: The history of planning The drivers of traditional planning behavior Traditional budgets versus rolling forecasts and agile planning techniques A new planning paradigm that delivers business-critical decision support The impacts of technology on FP&A The next normal is here and planning as we know is no longer enough. As BPI noted in the e-book, the only constant now for finance and business partnering is change, and from these challenges comes opportunity. And what’s that opportunity? A finance-led planning transformation that powers agility and proactivity amid continuous market uncertainty. To learn more about the new planning paradigm and to read the entirety of BPI’s conversation with Tom, download Planning [as we know it] is Dead for free. E-book Planning [as we know it] is Dead The next normal in financial planning and analysis is here. While the only constant in finance now is change, business partnering remains at its core. Learn how to plan for the new paradigm in FP&A now. Download the Free e-Book

You probably know him as “The FP&A Guy.” For nearly 15 years, Paul Barnhurst has been a leader, influencer and educator in the FP&A community. Visualizations tell your audience a story for better or worse. No matter how great your analysis may be, your audience will remember mostly the graphics and story you use to present your analysis. A poorly crafted story with weak visuals will destroy your credibility, and possibly even worse, mislead your audience. A well-crafted story with strong visuals goes a long way toward positively influencing your audience. In this blog post, you’ll learn five tips on how not to mislead your audience. I’ll take you through common mistakes in data visualization to ensure your next presentation will not only tell a story, but also help your business leaders make informed, data-driven decisions. 1. Keep Visuals Simple and Easy To Understand Source: LivingQlik I stared at this visual for several minutes and I’m still not sure I understand what it’s trying to tell us. Talk about cognitive overload. I thought 3-D graphs were hard to follow, but this 4-D graph hurts my brain every time I look at it. Keep your graphs simple and never use 3- or 4-D graphs. They’re hard for your audience to process. 2. Choose Color Wisely Source: KCRA This graph has a lot going wrong for it, from the color, to the labels, to the misleading message. We could spend this entire blog post discussing all the poor choices that led to this graph, but let’s focus on the color selection. When I shared this on LinkedIn, one of my followers commented, “The worst is the color. It looks like the more shootings the better 🤨.” The color choice for this graph makes no sense. Color should only be used to help drive a point home—not simply because you can use color. Next time you decide to get creative with your color, ask yourself, “Will it benefit my audience?” If the answer is “no,” stick with gray. Level Up Your Financial Modeling Fundamentals Learn from “The FP&A Guy” Paul Barnhurst the five questions you need to ask when you have too much information. 3. Don’t Invert Axes Source: Buzzfeed News With inverted axes, it suggests that the more an event happens, the less it looks like it’s happening. It’s confusing. The inverted axes of this graph leads the audience to believe that enacting the Florida “Stand Your Ground” law has resulted in fewer shootings, when in fact, that’s not true. When working with your axes, start from zero. Don’t use them to tell the story you want the data to tell, but instead, tell the actual story. 4. Don’t Overwhelm Audiences With Numbers Source: PolicyViz Like overusing color in the earlier graph, this one overuses numerical labels. They failed to understand that, just because you can put a number somewhere, doesn’t mean you should. Graphs are designed to tell a story visually, so tell the story with the fewest numbers possible—without sacrificing storytelling accuracy. In this graph, both the X and Y axes share the same scale and every data point is labeled. I would’ve labeled both axes with a meaningful description that helps the audience understand what the numbers represent. Put numbers along the axes only when they help visually tell the story, not because the underlying data merely has numbers associated with it. 5. Provide Enough Context for Decision Makers To Make a Decision Source: Statistics How To This graph lacks context. We see that the number of people receiving some form of federal welfare is increasing, but we can’t see if that number is increasing relative to the overall population. We’re not told either if the amount paid per person is increasing. This graph simply needs more information. How do you lead your business leaders toward informed, data-driven decisions? Data Visualization Helps Your Business Leaders Make Informed, Data-Driven Decisions After looking at those five poorly designed graphs, it’s clear that these common mistakes in data visualization can quickly destroy your credibility and your hours of hard work. Your presentation of the data often is as, if not more, important than the data itself. Remember: Your visuals tell your audience a story for better or worse, and your audience will remember mostly the graphics and story, not the data. Look at the visuals you’ve been designing lately and ask yourself, “Will this help my business leaders make an informed, data-driven decision?” If the answer is “no,” then your visual isn’t a well-crafted story and won’t positively influence your audience. Eliminate that graph or continue working on it—until it helps your business leaders make an informed, data-driven decision. Elevate Your Data Visualization Skills Watch Purna Duggirala a.k.a. Chandoo’s Data Visualization in Excel workshop from Excelerate =SUM(it) 2022 on Plan To Grow to help you make data-driven decisions.

You probably know him as “The FP&A Guy.” For nearly 15 years, Paul Barnhurst has been a leader, influencer and educator in the FP&A community. It was 2019. At Solera, I’d just been promoted to FP&A Director for the first time in my career and I was trying to figure out how to make the biggest impact in my new role. My biggest challenge was data—we had multiple billing systems and struggled with reporting customer revenue for our top customers in one unified view. My first hire was a contractor who specialized in working with data. He had no finance experience. This was one of the best decisions I’d ever made. He was our FP&A team’s first-ever dedicated data person, and our CFO quickly realized the value of having someone who could make magic with our data. It was like having an FP&A magician on the team. He immediately found ways to clean and normalize our data so we could automate processes such as sales commissions and monthly revenue reporting while we waited for new systems. After a few months, we hired him full time. And over the next year, he became my go-to resource. When he left a year later, our data was in a much better state to support the business. To replace him, I hired someone with a stronger background in forecasting and planning. When the most important thing the business needed was data insights, I hired a data person. And when the data was in good shape and the business needed support for its individual units so I could focus on the general manager’s needs, I hired a planning person. This taught me the importance of assessing: The key business’s objectives The key skills needed to accomplish these objectives While data is important, we shouldn’t focus only on hiring data analysts, data scientists and data architects (you’ll understand later why I’m highlighting these three FP&A roles). At the end of the day, as FP&A professionals and leaders, our goal isn’t to manage the data explosion. It’s to ensure the business makes the best decisions possible on deploying the next dollar of capital to generate the greatest return for the business. In this blog post, you’ll learn: The most needed FP&A roles Why FP&A teams spend so much time gathering and processing data How to address FP&A team resource needs FP&A Roles A recent FP&A Trends report identified five emerging roles we’re seeing today in FP&A that teams must have to succeed in planning and forecasting to fulfill the demands of the business. While none are “magician” like my hire, these roles are: Analyst Architect Influencer Data Scientist Storyteller During the panel discussion Contemporary Skills for Strategic Finance Professionals at Excelerate =SUM(it) 2022, I was asked which FP&A role I played. I said I’m none of the five and that there were two more I noticed emerging: “Interpreter,” and my role—the “Connector.” The audience was then polled on which role was most needed for their team. The top three answers were: Analyst (34%) Data Scientist (19%) Architect (14%) Level Up Your Financial Modeling Fundamentals Learn from “The FP&A Guy” Paul Barnhurst the five questions you need to ask when you have too much information. Given the data explosion we’ve seen over the last two decades, is it any surprise that the most needed roles are ones that work with data daily? A 2020 survey conducted by the Association for Financial Professionals found that FP&A teams spend 49% of their time collecting and validating data. The main reasons FP&A teams spend so much time gathering and processing data are: Lack of access to source systems Inaccurate or error-prone data Systems that do not speak to each other Underskilled team members No master data, multiple versions of the truth As teams struggle to find ways to more efficiently manage the amount of data they need to collect and validate, they continue to look for people with strong data skills. How To Address FP&A Team Resource Needs in 6 Steps This framework will help you understand which key skills your FP&A team needs to best meet the business's needs. Identify the key business objectives you need to accomplish in the next 6–18 months. Identify the key skills and resources needed to accomplish the key business objectives. Assess your team's current skills against missing required skills. Review assessment with leadership and address if other teams in the business can provide missing required skills and resources (e.g. Can they provide a data scientist on a part-time basis?). Develop a training plan to address your team’s key skill gaps. If necessary, develop a hiring plan to add resources to address your team’s key skill gaps. Every FP&A department needs to have the ability to work with data, but we also need to tell the story—with the business insights generated from that data—to influence the business. The next time you’re hiring someone for your FP&A team, analyze your objectives, your resources and the key skill gaps most needed before making your decision. In the end, we need to ensure the business makes the best decision possible on deploying that next dollar to generate the greatest ROI. Grow Your Strategic Finance Skills Watch “The FP&A Guy” Paul Barnhurst’s Excelerate =SUM(it) 2022 session, Contemporary Skills for Strategic Finance Professionals, on Plan To Grow to learn more about the emerging FP&A roles.

You probably know him as “The FP&A Guy.” For nearly 15 years, Paul Barnhurst has been a leader, influencer and educator in the FP&A community. In 2021, it was estimated that we created 2.5 quintillion bytes of data every day. That’s 2,500,000,000,000,000,000 bytes of information daily. It was also estimated that this volume will double every two years going forward. Is it any wonder, then, that during my Introduction to Financial Modeling session at Excelerate =SUM(it) 2022, when we polled the audience on which pain points they experienced with their financial models, the top answer at 37% was “too much information.” Learning how to look through data and decide what to include in your model is a financial modeling fundamental skill every finance professional needs to have. In this blog post, I’ll take you through five questions you need to ask yourself, when building and designing a financial model, to decide what information to include—and what to exclude: 1. What’s the Main Question I’m Trying To Answer? When preparing to build a model or conduct an analysis, the first question we must ask is: “What is the main question I’m trying to answer?” Many times, the question we’re trying to answer is either known or given to us when we’re asked to build a model. However, if we’re unsure, we should go back to our stakeholders and ask them: “What are you trying to accomplish with a model? Why do you need it?” We should keep asking questions until we clearly understand the question that our stakeholders need answered. This is an iterative process that requires us to drill down and continue asking questions until we get to the root cause of the problem that needs to be answered. It’s similar to the method we’ll use to determine what drivers we should include in our model. 2. What Are the Key Pieces of Information or Main Drivers I Need To Get That Answer? Once we’ve determined the question we’re trying to answer, we need to ask: “What are the key pieces of information or main drivers I need to get that answer?” When building a model, we’ll have a few drivers that are critical to your model. These drivers, if not included, will materially impact the final outcome. Determining which drivers are most important requires applying a structured framework to the problem. 3. What Are the Main Inputs or Activities That Will Drive the Outcome? One framework we can use is the root cause analysis. It requires us to ask: “What are the main inputs or activities that will drive the outcome?” For example, let's say we’re building a model to forecast call center expenses. We could start by performing a root cause analysis for the call center model to determine what drives our call center expenses. Notice the tree diagram I’ve built to map out the main drivers needed for our call center model. This visual analysis can help us better understand the different line items that make up your model.   To build our model for “Headcount” and “Facilities,” we can use the lowest level of each section as the driver-based assumptions. In this example, we have seven drivers (five for Headcount and two for Facilities): After reviewing these seven lowest level, driver-based assumptions, we could break each down further. For example, we could get more complex by breaking down “Payroll Taxes” into “Social Security,” “Unemployment” and “Medicare” or “Utilities/Maintenance” into “Telephone” and “Electricity.” 4. Will the Increased Complexity of Adding More Drivers Improve the Accuracy of the Model Enough To Justify the Increased Complexity? Before deciding whether to segment our drivers further, we must ask: “Will the increased complexity of adding more drivers improve the accuracy of the model enough to justify the increased complexity?” If adding the new level only provides a small incremental improvement in accuracy, but requires a lot of additional effort, then it’s probably not worth it. However, if the new level of granularity materially impacts the model outcome, then let’s include the lower level in the model. Learning how far to drill down—and when to stop—takes practice and varies by project. Let’s look at one more example. This time, we’re forecasting revenue for a business that sells only one product. For this simple “Revenue” model, we have two drivers: Volume and Price. For simple models, this may be all we need to get the answer to our main question. However, in some cases, it may require us going down a level and further breaking down “Price” and “Volume”—for example—by different sales channels. 5. Have I Captured the Material Drivers? As we analyze, we should stop at every level and ask: “Have I captured the material drivers?” If yes, we move on to gathering the necessary data to support your assumptions for each driver. If not, we keep drilling down. Financial Modeling Fundamentals Using a structured framework—and performing a root cause analysis—will help you reduce the time you spend sifting through data to determine what to include in and exclude from your model. It’s a financial modeling fundamental skill every finance professional must have. When you have too much information, start by asking “What is the main question I’m trying to answer?” and finish by capturing all the material drivers. Level Up Your Financial Modeling Fundamentals Watch “The FP&A Guy” Paul Barnhurst’s Excelerate =SUM(it) 2022 session, Introduction to Financial Modeling, on Plan To Grow.

You’re a director or manager of finance. You know how much work you have on your plate. You also know what’s coming down the pipeline. And for those reasons, you can’t shake the feeling that financial workflow automation could be the answer to many of your challenges.  Here are just a handful of the many benefits of workflow automation: Reduced labor costs Increased efficiency of task management Improved communication between team members throughout the company Increased scalability of workflows Improved accountability You get the point. There’s no shortage of benefits. Financial workflow automation has the power to turn your company upside down—in a good way, of course. While you may have automated some financial tasks to date, there’s a good chance you’ve come up short in other areas. Let’s review four financial workflows you haven’t thought to automate, but should, as soon as possible. Budget Approvals Think about how much time you spend on budget approvals. This process spans every department, from sales to marketing to customer service. Every day, week and/or month, you receive expense requests from every nook and cranny of your company. Without timely budget approvals, some departments may suffer. The problem with this is that the budget approval process is traditionally lengthy and complicated. And not because the process is difficult to understand. It’s a result of how many people have their hands on the process.  Outlining the budget approval process sounds like a simple solution, but all that does is add more steps and stress. By automating the budget approval process, you can: Define steps that every person and department must take to obtain approval Pull all pertinent information into one central location Keep records of budget approval requests, decisions and contributions made by all parties Finally, you can add parameters as to the types of requests that you automate. For example, budget requests of $5K or less go through one process while those that are more than $5K require manual verification and approval. Expense Reimbursement Just the same as budget approvals, expense reimbursements have a way of piling up. And if you wait too long to process them, you’ll also have an angry group of employees who are wondering when they’ll get their money back. With a traditional approach, employees will submit reimbursement forms via email or maybe even in person. Both of these are inefficient as you’re not collecting forms in a central location. Expense reimbursement automation can be as simple as the following: Activate the reimbursement process with a single trigger, such as the submission of the required form(s) Automatically send requests to predetermined personnel for approval, based on conditions such as department and reimbursement amount Set notifications to keep the employee informed as to where their request stands The key to a successful expense reimbursement system is to collect the necessary forms in the same manner, every time. And that’s exactly what happens when you create an automated system. Invoice Management Does your company purchase products or services from vendors? If so, an automated invoice management system can eliminate headaches, save you time and ensure that your vendors get paid in full and on time. For many companies, invoice management means receiving invoices from vendors—typically via email or mail—passing them off to the accounts payable department and paying them one at a time. Automated invoice management is the new way of doing things. Here’s how it works: Request that vendors submit invoices in a specified manner, such as email Activate the workflow with a trigger, such as receiving an invoice via email from a vendor Automatically send requests to the proper individuals or departments for approval Alert the vendor as to the stage of the process, such as “invoice received” and “processing” Automatically update invoice status, such as unpaid, processing or paid Invoice management requires automation. Even if you only receive a handful of invoices each month, automating the process will benefit both you and your vendors. Fixed Asset Purchases Fixed asset purchases are difficult to track as these vary by cost, the requesting party and the number of people required for approval. For example, depending on the department or amount, there may be a specific person who needs to sign off on the approval. Traditionally, fixed asset purchases worked like this: A department or employee files an initial request All involved parties communicate on matters such as the need to purchase the asset, the vendor and ways to save money, among other details Final approval (or denial) is given Now, let’s think about what happens if you automate the asset purchase workflow: Requesting parties are given a central location for submitting purchase proposals All applicable and required information is collected from the requestor before it reaches the review stage Approval is streamlined since all information is collected upfront With this approach, there’s no back and forth communication. Instead, the requester shares the information needed to make the decision and it’s immediately routed to the person staffed with reviewing it. You can add as many variables as you want, such as requiring special approval for purchases over a specific dollar amount. Summary Financial workflow automation is every bit as powerful as it sounds. The more tasks you automate, the easier it is to take advantage of benefits such as reduced costs, time savings and enhanced communication. Are you ready to get started?  Automate Your Financial Workflows Learn how workflow automation can take your operation to the next level from an experienced workflow automation expert.