Is It the End of Spreadsheets for FP&A Teams? Part 1
Is It the End of Spreadsheets for FP&A Teams? Part 1
In recent years, the world has undergone dramatic transformation which has underscored the importance of being able to rapidly adapt to uncertainty. The business landscape has also been forced to evolve significantly. FP&A teams are no longer able to get away with “set it and forget it” forecasting and planning and CFOs are under increased pressure to support the demanding needs of the company.
- We need data…accurate data… at our fingertips...at all times
- We have remote teams that require a decentralized budgeting and planning process
- Finance is deeply integrated with multiple business units including Sales, Marketing, and HR
- There are more corporate solutions being used to manage Finance functions (ERP, CRM)
- Spreadsheets simply aren’t agile enough to support the modern FP&A team
The need for a multi-dimensional database rather than just a row and a column set has become more important as businesses keep up with requirements from the Board of Directors, investors, internal teams, and clients/customers. Stakeholders need to be able to make instant changes that will directly impact business performance and to know what levers to pull to see the desired results. No longer will spreadsheets suffice as the single source of truth.
Companies of all sizes now need an Enterprise Performance Management (EPM) solution to stay competitive. The global EPM market size is expected to grow from $6.0 billion in 2022 to $8.3 billion by 2027 at a compound annual growth rate (CAGR) of 7.0% during the forecast period 2022-2026, according to MarketsandMarkets.
Business Priorities Drive Change
There is a growing need for a budgeting, planning, and forecasting tool to help with business strategy. Finance is now a critical part of the business and needs the ability to create “what if” scenarios, get accurate data, and to quickly create P&L statements and other financial statements within seconds as opposed to days.
Long Range Planning is Critical
Being able to have a long-range strategic plan where you can pull in multiple years of history, use that from a predictive standpoint and then make any top line adjustments not only adds strategic value for the FP&A team, but it prepares the company for possible situational changes.
Reduce Spreadsheet Errors
When you’re inputting data into multiple spreadsheets, there is more of a potential for human error, especially when multiple versions of a spreadsheet are being sent around. An EPM solution allows you to manage versions, create “what if” scenarios, and easily update numbers into Microsoft tools such as PowerPoint, Word, and even Excel for easy and accurate Board reporting.
Automate the Process and Save Time
How many people do you have on your team spending time putting data into spreadsheets, refreshing data, creating pivot tables, updating Board decks, and other manual work? Do you have other solutions such as a CRM, ERP, MES (manufacturing execution solution) that you wish were integrated with your budgeting and planning process? An EPM solution easily integrates with leading systems so that you have a continuous flow of data that is easy to access at any point in time.
Add Value to the FP&A Team
No longer does your FP&A team need to be the “data entry” team. Time that was previously used building reports in your ERP and putting them into spreadsheets and trying to pull P&Ls can now be used more strategically. You canshift your FP&A team from just building reports to adding value to the organization.
Using Insights Drives FP&A Agility
Using an EPM, the availability of real-time data helps the FP&A team be more proactive versus reactive. In seconds you can read the data, digest it, and make strategic business decisions. Being able to plan for different scenarios and make assumptions allows the company to be agile and make necessary changes.
The Future of Spreadsheets
Do I think spreadsheets are going to completely disappear from FP&A teams? Read part 2 to find out.
To learn more about how Workday Adaptive Planning can help elevate your FP&A team, check out these resources:
This blog was written by Dan Brooks, senior director of Sales at Kainos, the six-time Global Workday Adaptive Planning Solution partner of the year.