Democratisation of the planning process through Integrated Business Planning

Democratisation of the planning process through Integrated Business Planning

The democratisation of IT is not new. Giving users the tools to solve their own issues has been an ongoing trend for over a decade since the advent of Web 2.0. While there are many examples of how this has reached various areas across the enterprise, one area where this has yet to catch on is the enterprise planning process.

Enterprise planning is unlike business intelligence which already has many tools that allow access all the way down to rank and file employees. Planning is a complex combination of assumptions, calculations, and models across many dimensions. With most planning systems to date, handling these complexities has been beyond the average business user without the help of IT—meaning it was far from being democratised for use by the masses.

How does the democratisation of planning help businesses today? With the right platform in a secure environment, planning models can be built by the business individuals who best understand the goal they are trying to achieve, the growth they are trying to drive, or the costs they need to contain.. By empowering users and decision makers across the organisation, they will be able to glean real-time insights and companies will become more nimble and responsive to changes in the market.

How do you democratise enterprise planning? One way is to provide a collaborative environment across the business for planning—linking the traditional silos across Finance, HR, Sales and Operations Planning (S&OP) processes—or what we call Integrated Business Planning (IBP).

Is Integrated Business Planning a myth?

Integrated Business Planning is an overused phrase in the industry, but what I find really fascinating is that despite all the industry talk about IBP over the last several years, I haven’t personally seen any organisation that has been successful in achieving holistic planning across Finance, HR, and S&OP with the help of automated enterprise software.

It may have been the intent of most companies to implement IBP but unfortunately, existing technology has been unable to facilitate this. So, companies resort to using Excel to connect the different pieces together . I have spoken to customers who have implemented an S&OP process but the company continues to operate in silos because the people responsible for supply and demand do not talk to their commercial and finance counterparts.

How do companies achieve truly integrated planning?

Most companies know the benefits of IBP but are unsure or unable to get there. Here are some common requirements to achieving truly “integrated business planning:”

  1. Approach IBP as a process and a technology

The reality is that IBP is truly both. As an organisation, you must have an IBP process defined which provides a birds-eye view to management about how the company would execute strategic plans across different lines of business. IBP technology needs to enable the strategic deployment of this process across products, demand, supply, Finance, and IT.

  1. Collaborate through people, processes and technology

While the senior leadership of the company understands why the IBP process is important, existing technology has often failed to provide a solution which can implement that process across the different departments and provide an easy way to collaborate. Collaboration is a must for IBP success – both through the process, the people and the technology.

  1. Choose technology that is agile and business user friendly

IBP technology has to be agile so that key stakeholders in the process can simulate different scenarios fairly quickly and see the impact of a particular strategic decision across different lines of business. Historically, there is one set of technology for S&OP, another for annual operating plans and budgets, one for managing projects and profitability, and one for workforce planning, etc. While you could technically connect all these different systems, there is a lack of agility to perform dynamic simulations across all lines of business. Companies are in need of a technology which can provide business-level simulation across the entire company without the help of IT.

  1. Everyone must make decisions based on the same set of numbers

It is usually difficult to reconcile numbers when there are different systems. If there were only one place where one could do IBP across S&OP, Finance, HR, IT functions, there would only be one number to look at. It is not about replacing existing S&OP systems or annual budgeting systems but about providing an assessment of how the business is performing and what tweaks one has to make to steer the business in the right direction. This is what CEOs are looking for but there is currently a huge latency in this process despite investments of millions of dollars in enterprise software.

  1. Business user self-service planning is a must

Too often, business users do not have the capability to operate without the intervention of the IT department. Given how pervasive self-service business intelligence software is, business users expect the same level of independence and flexibility when participating in the planning process. Unfortunately, none of the existing technology has effectively provided self-service access to the planning process. This is what business users across the lines of business are calling for–the self-service capability to operate within the constraints of the IBP process that the company has defined.

A solution to all this is a planning cloud that enables business users across organisations to build their own models to test and operationalise their plans, manage complex multi-dimensional models, collaborate across functions and regions all in real-time. That’s where Anaplan comes in. Anaplan provides an agile platform that can help businesses realise their vision of integrated business planning across all key lines of business. This means one could connect an annual operating plan to a S&OP plan while providing closed-loop feedback to finance and manpower plans. This would be an actual strategic deployment of IBP that enables the democratisation of the planning process.

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