Changing a habit is always difficult. Humans are afraid of change, by nature. But moving to 21st century technology is something that is inevitable in today’s fast paced business-planning environment. If you are working on business planning technologies that have been designed in the 20th century – be it on a daily basis as a functional administrator or once a year as a data contributor – you should be aware that the upgrades and functional enhancements of your software will be extremely limited in the future. These solutions have reached their plateau and are now too complex to evolve.
Using myriad incompatible and aging planning tools outside of your control -typically in the hands of IT- is a problem of the past. Why not take advantage of the cloud instead of relying on spreadsheets on top of your rigid corporate business planning system?
Now, you can improve the quality and relevance of your plans, just by making a few key resolutions for 2015. Just consider these key points when looking at the alternatives to renew your legacy planning and budgeting on-premise software.
Resolution 1: Get everyone on board
Time spent to fill in budget templates is becoming a low value added task. Many fields could be pre-filled with suggested driver based calculations or trends based on historical data. A large portion of the manual data entry is actually a re-entry. For example, new hires training budgets should be automatically evaluated against new hire recruitment plans and average or historical training costs.
Additionally, your budget templates should be adaptable. Every page or form should only show to the user the data that is relevant to his work. Setting up and adopting a new system can be a challenging task. There are constraints that require proper change management. The end users might think: a new system? Again? In order to earn their commitment, the new system has to make their job easier than before. Ideally, it will simplify their tasks by presenting them only the relevant data and the fields to complete. And it should work natively on any mobile device, especially for the workflow tasks like submission/validation. This should all be done easily, with minimal and efficient security settings, and with one single report that customizes itself based on the profile of the connected user.
Resolution 2: Tell the story behind the numbers
Numbers by themselves do not intrinsically make sense, and can be interpreted in an infinite number of ways. To tell the story of your budget and of your plan, you need to explain not only the how many and the when, but also the why, the how, and the who. Explanatory text is essential. Commenting on your inputs is essential to justify your numbers or resource requests. But comments are not the only texts needed in a budget system. You need clear titles in your input forms and reports. Use day-to-day language, not just a financial language. Allow the users to input their data in the format that is the most natural to them.
Resolution 3: Keep it simple
With simple sets of instructions, users can more easily navigate the system and draw their attention to what requires their action. Let the users add commentary at any level of your business dimensions, especially on aggregated levels, to explain the high level directions. You might even consider making these comments mandatory in order to move a step ahead in the workflow process. Anticipating the most common questions and issues will allow you to accelerate the process, avoid ambiguous e-mail chains, and cut down the number of iterations.
Resolution 4: Visualize it!
Reporting dashboards and visual indicators also play a critical role in the ease of use of a new system: color-coding according to threshold values helps to underline the significant variances or to get an instant view of the workflow status. Think win-win: if you require contributors to enter data and to justify their plans, offer them useful information in exchange. Help them to improve their daily activity by providing them ad-hoc reports and dashboards, all in one single system.
Resolution 5: Never forget that time is of the essence
Dates are everywhere when you are dealing with plans and budgets. Date management at the day level should be a native and powerful feature of your budgeting system. By definition, a plan is subject to change. The goal of the planning exercise is to predict the future revenues and needed resources, especially when it comes to asset management, recruitment, capacity planning, and return on investment.
Dates have a crucial impact on accounting and also on all the budgets and plans in your organization. You should not be dealing only with quarters or months. Accurate dates are important when you are working on short or mid-term plans. For example new hires’ start dates, employee leave dates, promotional operations dates, sales territory validity dates that have a crucial impact on sales operations and bonus payments, acquisition dates, investment dates, etc. There are multiple consequences in various functional domains, including accurate depreciation calculation and efficient workforce planning; the list could go on and on.
Resolution 6: Facilitate better data collection and consolidation
Last but not least, all consolidations should be entirely automated. If you’re still wondering how you’re going to consolidate the budgets from all the entities, including intercompany eliminations, you might have missed an important step. A budgeting and planning system must not cast doubt on this point. Aggregating budgets and plans, whether they come from legacy source systems or remote contributors, should not require more than a single mouse click. No heavy spreadsheet manipulation, no nighttime batch calculations, no data redundancy, and no loss of details. You should make sure this is covered in your new system because the time and amount of work to aggregate, correlate, and distribute data in these cases will not be negligible if you don’t have a system that handles this without any effort and any preparatory work other than setting up your dimensions, roll-ups, and business rules in a natural language.
What to do next
Keep these 6 resolutions in mind and make sure you choose a solution that will reduce the workload of functional administrators and contributors instead of placing a burden on them. Look at changing your habits. Evaluate your alternatives before running out of time because of your legacy planning system that requires more IT skills than business knowledge.