Financial Intelligence

How to Improve the Budgeting and Planning Process to Reshape Future Growth

Accurate forecasting and analysis are important components of managing a business. In the era of COVID-19, it has taken on even greater importance as changing conditions create uncertainty across almost every industry.

In the past year, we have seen an increased focus on financial intelligence as a critical organizational competency. At insightsoftware, we define financial intelligence (FI) as a higher order of thinking that defines how best-in-class finance teams operate.  It’s data analysis instead of just collection and reporting. It’s insight that creates and enables value, not just reporting on business performance. It’s a culture of empowerment, proactivity, and expertise.

The ability to bring together data from many different systems and to make sense of that information in a way that creates value for the organization is at the heart of the FI paradigm. Whereas business intelligence is tactical, FI is strategic.

What does that mean for the budgeting and planning process? During periods of high volatility, speed and accuracy are paramount. Managers need access to a comprehensive picture of what’s happening in real time. As conditions change, new questions emerge. Agility is key.

COVID has created new challenges, but the disruptions brought about by the coronavirus pandemic have exposed existing weaknesses and served as a catalyst for change. FI demands that companies forecast frequently, deliver information rapidly, maintain high standards for accuracy, and foster greater agility.

Let’s look at each of those characteristics in turn.

Frequency: Eliminate Bottlenecks

In a changing business environment, leaders must have a clear view of what is happening both within and outside the organization. When the coronavirus prompted widespread shutdowns, for example, most business leaders saw a need to shift from monthly or quarterly cash flow projections to a more frequent cadence. For many, a rolling weekly projection became the norm.

Likewise, sales projections in a volatile business climate present a significant challenge and call for finance leaders to create and update forecasts on a more frequent basis.

Many organizations still rely on tedious manual processes every time they run a new forecast. There are many reasons for this, starting with the fact that most software systems don’t do a very good job of presenting information in a way that is useful for forecasting and analysis. As a result, financial analysts often go through a complicated process of exporting, copying, pasting, and reformatting information that comes out of their ERP system.

To make matters even more difficult, many budgets and forecasts rely on combining data from multiple software systems. Sales forecasts, for example, should consider sales pipeline information in addition to historical revenue trends from ERP. The standard budgeting and planning tools that come with those software packages are poorly suited to that kind of combined view of the business.

The bottleneck caused by working with inefficient technology makes it difficult, if not impossible, to forecast on a frequent schedule.

Whitepaper: How to Select Budgeting Software

Download Now

Speed: Seek the Right Level of Detail

This copy/paste problem isn’t only a waste of valuable staff time, though; it also creates an unnecessary time lag between the moment an event happens in the business and the time that it shows up on management’s radar screen. In a changing environment, a lot can happen during that delay.

As demand spiked for certain items following the initial onset of the pandemic, leaders who had clear and timely visibility to shifts in demand were better able to respond to changing circumstances. Large swings in demand have a cascading effect. A sudden 30 percent increase (or decrease) in sales volume impacts cash and receivables, human resources, capacity management, supply chain, and production. As managers scrambled to cope, delayed access to information led to missed opportunities.

Companies seeking to remove bottlenecks and increase speed need robust planning tools that can draw on data from many different systems in real time and enable business leaders to model multiple scenarios to understand the best course of action to take as change unfolds. The standard planning tools that come with ERP, CRM, and other software packages simply aren’t built for that.

Accuracy: Have a Single Source of Truth

C-suite executives often complain that they receive many versions of the truth from different people within their organizations. When the VP of Sales asserts that revenue is on track for the quarter and the CFO contradicts that claim, the result is usually a debate about which number is true. That can be frustrating for everyone involved.

Financial Intelligence

Effective budgeting and planning processes require collaboration across many different departments and a supporting toolset that provides a view to that all-important single version of the truth. Once again, this points to the need for planning software capable of pulling information from multiple systems throughout the organization, in real time.

Agility: Adapt Quickly

Above all, recent events have convinced business leaders of the paramount importance of agility. As the unexpected events of the past year unfolded, we heard about numerous companies that successfully pivoted in response to changing conditions.

Manufacturers reconfigured production lines to make personal protective equipment. Food and beverage companies shifted away from bulk packaging for restaurants and institutions, producing higher volumes of packaged foods for consumers instead. Supply chain managers sought out new sources for products and raw materials, often struggling to maintain on-time deliveries amid all the disruption.

Financial Intelligence

Many of these situations call for new types of analysis. Finance and accounting teams were called upon to answer new questions that had never been asked before. To meet those kinds of challenges effectively, finance and accounting teams need flexible, self-service tools that empower them to extract, manipulate, and analyze information in new ways.

Succeeding in the New Normal

In today’s world, FI is a strategic imperative. Frequency, speed, accuracy, and agility are all essential ingredients of surviving and thriving amid the new normal. Business intelligence views the business through the rearview mirror. FI is focused on the road ahead.

For nearly three decades, insightsoftware has been helping business leaders transform their organizations by unleashing the power of FI. If you would like to learn more about how you can improve budgeting and planning in your business, contact us today for a free demo


insightsoftware -

Global provider of enterprise software solutions for the Office of the CFO to connect to & make sense of data in real time, driving financial intelligence across the organization.