Are You Prepared for Planning Season?

If your reaction to reading “planning season” in the title was, “Ugh!”, then it’s time to rethink your approach.

We’re in an economy that moves quickly. Advancements in production, logistics, technology, and other areas have translated into faster times to market…for both you and your competitors. Companies can be run from a single laptop, manufacturing is on-demand, and new sales channels continue to pop up in places no one could have expected. Couple that speed with the current market volatility, geopolitical uncertainty, and not-so-promising economic outlooks and it’s going to be difficult for any company to plan effectively.

But one thing clearly makes planning less effective: a long, laborious, error-prone process that takes months to complete and results in a plan that’s stale before you click send on the final report. That can all be eliminated with a Financial Planning and Close Platform, and it’s easier to deploy and get started than you might think. In fact, if you’re starting to think “Ugh!” because planning season is getting close, you still have time to make this year’s planning an easier, less taxing, and more accurate endeavor.

Begin with the End in Mind

The results of your planning efforts drive next year’s investments and focus. It guides hiring decisions, influences market targeting, directs product direction, and so much more. It wouldn’t be hyperbole to say that it’s probably the most important thing finance does all year.

What frequently happens is that the cumbersome nature of building a spreadsheet-based plan severely hampers your ability to alter the plan as new information or new realities occur. As the months go by, it gets harder to roll new information into the plan and harder to alter the plan based on real business results. But things do change, competitors do change course, and markets do shift rapidly. A long, manual, cumbersome planning process makes adding any new information more difficult as each day passes.

Host customers tell us that, before using Host, their annual planning cycle runs 4 to 6 months. They also finished their annual plans around the beginning of February, when Q1 is almost half-way over.

Just think about how much work goes into that as well as how stale the data is by the time it’s complete. Organizations with a Financial Planning and Close Platform can reduce planning time by as much as 50%, plus work with real-time data, easily create and analyze what-if scenarios, automate data collection, and eliminate reliance on spreadsheets and email. The resulting plans are not only more accurate, they’re more useful for an organization and more indicative of the realities in the coming year.

Planning Shouldn’t Be A Drag

Forget about your own reaction to planning for a moment and consider the reaction of the rest of your organization. Do other teams resist the start of planning? Is it difficult to get timely data or even replies to emails? Do teams balk at the amount and cost of manual work required to supply the required information?

Now think about the impact your planning cycle has on finance. There are probably a lot of spreadsheets being emailed around and requiring tedious review and consolidation. Version control becomes an issue. Errors are made, mistakes are missed, and they both compound as you roll up the data into aggregate reports and forecasts.

Finally, consider the results of these months of work. If executives don’t consider the resulting plan as valid, or they just think of it as a marginally useful perspective, then what’s the use? If your months of hard work result in a plan that’s neither accurate nor appreciated, it’s time for a change.

Looking for more best practices for your upcoming planning season? Download our Best Practices in Financial Planning and Analysis white paper.

When the process is suspect, that suspicion trickles down to every team who should be using the plan as their execution roadmap.

Collaboration with budget owners, contributors, and stakeholders is critical to the planning process. A dedicated cloud-based planning platform lets those budget owners contribute easily and efficiently, has built-in workflow processes to manage tasks and deadlines, and keeps comments and communications in context with the data. It also lets teams update and revise plans anytime, from anywhere, even if they’re offline.

Data is the Key to an Accurate Plan

We used the word “stale” above. That’s a challenge for every planning cycle. As the planning cycle drags on, it’s more difficult to change or update any of the data or assumptions. So then you begin the new year with a plan based on data that’s already a quarter or two old. In Q2, you’re already discounting the data that you used because it’s simply obsolete.

A Financial Planning and Close Platform helps to solve that issue by integrating directly to the systems and data required for annual planning. That means instant access to real-time data that’s always current. So when a change is requested or a market shifts, plans can be updated with just a click. Plans then are more credible and the business puts more stock in the validity of those plans. 

Build a Better Plan with Host

Host Analytics gives finance the tools to fully engage and collaborate with budget owners along the entire planning process. It helps save everyone time, and results in better insights for better decisions. 

Interested in learning more? Join our next weekly Cloud Financial Planning & Close Platform Demo, which happens every Thursday at noon Eastern Time, 9:00 AM Pacific Time.

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