Leading CFOs and finance managers are constantly looking for opportunities to evolve their financial planning initiatives. Unfortunately, the problem that most finance professionals run into is that traditional practices involve manual data processes which can be restrictive, time-consuming, and prone to error. While this was previously a major roadblock within the finance industry, FP&A software is now serving as integral technology that is revolutionizing how finance teams conduct their forecasts.
Before a finance team can choose FPA software, they must first know which characteristics to look for in an integrative platform. If you are on the market for a financial planning tool that can help with all of your financial forecasting needs, this article is here to help.
Below we will be taking a deep dive into the world of FP&A software so you can choose the best technology for your specific needs. To help you get started, let's take a closer look at FP&A and its impact on an organization.
What is FP&A?
Don’t have an FP&A team yet? Financial Planning and Analysis (FP&A) is the process of forecasting business performance to support crucial decision-making for company executives and senior management. Another way to look at FP&A is the practice of gathering, transforming, and analyzing data to illustrate the current and future state of an organization. While most people may assume that FPA managers and accountants perform the same job, those that specialize in FP&A are more forward-looking and assist with strategic planning. By following a tactical FP&A plan, companies can create more robust forecasting and models for the future.
The set backs of traditional FP&A processes
While finance teams can follow an FP&A process without the help of a financial planning tool, these manual tasks tend to be laborious and restrictive. Traditionally, finance teams had to spend days pulling, compiling, and cleaning data from their HRIS, BI, ERP, and other data systems to conduct their monthly forecasts. Instead of spending time on critical tasks such as forecasting and analysis, finance teams had their hands tied behind their backs, nose deep in excel sheets manually calculating data. It was obvious that finance teams needed to revamp their FP&A practices, but the pivotal question still remained: How can the FP&A process be improved?
That’s when financial planning software came into the picture. FP&A technology is used to streamline the entire financial planning process from start to finish. While not all FP&A platforms are created equal, an advanced solution can pull financial data from several different sources, create monthly forecasts, and serve as a central hub for all senior management within an organization.
Convinced that your finance team needs FP&A software? We thought so! If you are looking to modernize your entire FP&A approach, the first thing you need to do is to choose an intuitive software that can handle all of your forecasting needs. By incorporating automation software into your operations and following the latest FP&A trends, your team will be able to streamline all its FP&A processes. Below are a few crucial FP&A features to consider when selecting your financial planning platform.
FP&A features & technology considerations
An agile FP&A solution empowers finance teams to make better decisions and create more accurate forecasts. When using the right software, teams can effortlessly upgrade their entire financial planning and reporting processes.
With so many different FP&A tools and excel plugins on the market, it can be difficult to know which one is right for you. If you are currently browsing the market for a tool to improve your current FP&A process, keep these considerations top of mind.
Some platforms require a lengthy integration process that can take months to complete. The last thing your team needs is more delays. Don’t waste valuable time with onboarding when you can choose a solution that will have your financial data consolidated and integrated in no time. When comparing the different software options available, go with a solution that allows you to get up and running so you can start creating financial reports right from the start.
What’s one of the most crucial aspects of financial planning and analysis? Two words: financial automation. Automation is what allows teams to streamline and consolidate all their metrics in a single platform. Do not underestimate the impact an automation tool can have on your finance team. An intuitive software should be able to seamlessly pull useful metrics for all budgeting and financial modeling. When searching for the best FP&A software, choose a solution that supports full automation so you can spend more time analyzing and conducting strategic planning. While there are a number of excel automation tools to help speed up manual tasks, make sure the product also offers other useful forecasting features as well.
Financial forecasting allows teams to evaluate both current and future conditions within an industry to assist in decision-making and goal-setting among senior management. Choose an FP&A solution that allows you to alter your monthly, quarterly, and yearly forecasts as needed to adapt to unexpected roadblocks. Aside from budgeting and forecasting, FP&A technology should be able to support people planning, scenario planning, manage cash flow operations, and account for what-if situations. Using FP&A technology that can pivot forecasting at a moment’s notice is essential for accurate forecasts and business planning.
Planning & reporting
Prepare reports with ease when using an intuitive platform that compiles, organizes, and computes data with just a click of a button. With the right FP&A software, you can view your financials in a single platform and provide full transparency to key stakeholders.
In traditional reporting practices, the finance team has to reach out to marketing, sales, and other departments to access data across an organization. The problem here is that this communication is spread across emails, Slack, and several other platforms. This disjointed communication and collaboration results in even further delays for the finance team. If you want to align all departments of an organization on critical financials, you need to go with a platform that offers seamless collaboration. Choose software with built-in comments and/or chat capabilities to discuss reporting or analysis findings. With integrated communication features, your finance team will be able to discuss specific metrics, ask immediate questions, and resolve any issues right from a single platform.
Give your stakeholders a modern upgrade with contextual multimedia in the form of charts & graphs, embedded decks, pictures, videos, spreadsheets, and more. The right tool will provide you with valuable context alongside your data to support better analysis and decision-making.
How does an FP&A software streamline financial planning?
Let’s face it, manually cleaning and extracting data is tedious, prone to human error, and labor-intensive. As one of the most fundamental teams of an organization, the finance department has to evolve its strategy in order to handle the financial complexities of its company. The teams who do not adapt to new FP&A practices are simply throwing away valuable time and underutilizing their analytics.
How to take your FP&A processes to new heights with Abacum
If you are looking to evolve your FP&A practices to support decision-making and financial planning, Abacum is the perfect solution for you. Our integrative FP&A software helps streamline the entire financial planning and forecasting process from A to Z. Unlike other financial planning tools, Abacum works with you and is able to evolve as your team grows. With built-in collaboration features and seamless integration of data platforms, Abacum serves as a scalable financial hub for the entire organization.
To see how our software can help elevate your financial planning, request a demo with one of our FP&A professionals today.