A CFO's Guide to uncovering greater value in planning and forecasting through the role of finance

As a CFO, financial planning and analysis are essential to the success of your organization. But how can you ensure that the finance function is providing maximum value in the planning and forecasting process? Here we’ll explore strategies and best practices for expanding the finance function’s role in an organization’s planning and forecasting process.

The role of the finance function

The roles of CFO and Director of Finance are evolving to become more trusted strategic business partners rather than pure operational functions. Advances in technology have enabled finance teams to become more pivotal in key operational strategies, helping them collaborate with key decision-makers by providing deeper insights so informed decisions can be made. This means that the Office of the CFO is shifting from providing financial information to helping shape the company’s future through financial planning and analysis (FP&A). Finance teams can create more value for their organizations by getting more involved in forecasting and planning. To do this, they must engage in more than just crunching the data. They must look beyond the numbers to identify the potential broader impact on the business from any potential recommendations they may give. For example, they should be able to assess the impact of an acquisition on both the short-term budget and the long-term strategy. With these insights, the CFO can provide guidance to help shape the organization's direction.

Click to read FP&A product brochure - blog - FG 

Adding value to the planning and forecasting process

By transitioning from static siloed finance-focused planning to enterprise-wide planning and reporting, the Office of the CFO and leaders of FP&A can bring tremendous value. Modern technology like FP&A systems provide the tools to allow forecasting and planning from all areas of an organization, enabling better decision-making and providing insights that weren't available before and were potentially difficult to uncover – especially if relying on multiple Excel spreadsheets. The office of the CFO can now lead the way in leveraging modern technologies to increase the value of planning and forecasting.

The benefits of expanding the finance function's role

By expanding the role of finance in planning and forecasting, finance teams can create more accurate and timely reports, quickly drill into detail when needed, access data faster, and have more time for presentation and analysis. Incorporating the finance function more deeply into the organization's planning and forecasting processes can create more synergy between departments and improve the quality of decisions being made. The finance function can provide invaluable insight into an organization’s financial performance and offer decision-makers in other functions the necessary data and tools to make smart decisions.

By increasing collaboration between teams, the finance function can become a more integral part of the planning process, allowing departments to come together to develop more accurate forecasts and get more out of the planning process. Working together can also create more transparency and accountability between teams, enabling them to share data, resources, ideas, and goals. The result is improved accuracy, faster data access, and increased unity and alignment throughout the organization. This increased collaboration can also free up time for finance teams to dive into greater analysis, identify new trends and opportunities, and provide recommendations and insights for strategic decision-making.

Financial data can also be used for data storytelling, allowing teams to uncover hidden insights and create powerful visuals for better decision support. In this way, the finance function can be a key driver of success for the organization, ensuring better decision-making, greater efficiency, and overall success.

How to expand the finance function's role

One way to expand the value of the finance function’s role is through scenario planning. This involves forecasting potential cost savings and the impact that it could have on the business in various possible scenarios. Expanding business partnerships and cross-functional collaboration is critical to success. Retaining employees with the right skill sets and experience to support the organization’s business objectives is essential, so alignment with Human Capital Management (HCM) and people planning is vital to ensuring long-term success.

All of these will help the finance function become more proactive and better able to support decision-making within the organization. Leveraging technology can further enhance value creation through the finance function. Automation can be used to reduce manual workload and automate mundane tasks, freeing up time for higher-value activities such as providing data analysis or strategic insight. Analytics are also important tools for businesses to gain a deeper understanding of their operations. Incorporating data analytics into financial operations can provide valuable insights into operational performance, helping uncover new opportunities for improvement and cost-saving measures.

The technology

Technology such as FP&A and HCM solutions can help expand the value of the finance function in an organization’s planning and forecasting process. Such software, when used correctly, can streamline processes, automate calculations, and provide more granular insights into financial performance. This helps decision-makers more accurately forecast upcoming business activity and inform strategic decisions. Additionally, these solutions offer integrated planning and budgeting capabilities that can be linked with existing systems like enterprise resource planning (ERP) or customer relationship management (CRM). This helps the finance team leverage real-time information, ensuring that budgets and plans are based on actual data rather than assumptions. By leveraging these technologies, organizations can better analyze their financial performance over time and gain a more accurate picture of their overall performance. In turn, they are better able to develop plans and budgets that are rooted in fact rather than guesswork.

How Unit4 can help your finance team expand value in planning and forecasting

Unit4 solutions for FP&A help finance leaders plan smarter with more accurate budgeting and robust forecasting tools. They can access the digital capabilities and insights they need to gain a clearer view of the organization’s financial health and drive greater collaboration with other teams and explore the benefits of integrated ERP and FP&A here.

Guide your business with intelligent decision-support financial planning and analysis tools that fully align teams and enhance visibility to support decision-making while ensuring all areas of the business understand their contribution to the organization's success. Check out this page and this FP&A eBook, which will take you through the details.

You can check out Unit4’s People Experience suite here - designed for service-based organizations like yours. This comprehensive solution gives you the tools you need to become the strategic CFO of tomorrow, no matter how your role evolves or grows.