Understanding, using, and succeeding at integrated business planning
Get the information and tools needed to not only adopt, but excel at using integrated business planning within your organization.
A business’s ability to thrive in a volatile climate is the ability to create, execute, and modify plans in response to market conditions and disruption. That’s what separates thriving businesses from the average ones in today’s turbulent environment.
To thrive, it’s imperative to operationalize integrated business planning (IBP), a holistic process serving every major function of a business. In this blog, we’ll explain what IBP is and how companies can use it to improve return and reduce margin.
What is Integrated Business Planning (IBP)?
Connecting all planning capabilities throughout the entire business is the core concept of IBP. For instance, IBP can connect strategic plans with sales’, operations’, and finance’s plans as well as aligning plans with suppliers and customers. Then, IBP enables balancing resources and funding with the business’s financial goals. Considering how many stakeholders are involved in IBP, there are lots of moving parts and it can be difficult to implement this style of planning.
Why use integrated business planning?
Beyond the benefit of better outcomes, there are several contributing factors that influence better performance across the business. Companies using IBP well can expect:
- Better visibility. IBP allows companies to funnel supply chain projections, financial projects, and strategic plans into one strategy.
- Greater alignment. With visibility into all lines of business, decision-makers can agree on one plan and understand where they fit into it, driving IBP project focus.
- More accountability. Similar to visibility, accountability is a natural consequence of each department understanding the plan and their role. Those who are hitting or missing targets are easily and quickly identifiable for faster optimization.
- Better decisions. The structure of an IBP approach makes it simpler for companies to focus on making more informed decisions, and reducing decision latency. This translates into greater contributions towards profitability and efficiency goals.
- Delivered results. IBP leaders consistently deliver top-line, bottom-line and customer service improvements.
Ways to succeed at integrated business planning
As with any transformative and new process, IBP requires executive buy-in and a clear vision. The first step is to find an executive sponsor to help align stakeholders, provide change management guidance, and ultimately become the executive champion for IBP.
There are several basic principles of IBP crucial to its success. Without these, any IBP strategy will face an uphill climb to success or worse, simply fail. These attributes are:
- Effective governance. Having a clear hierarchy of decisions, understood policies and procedures, and performance incentives creates motivation to adopt and succeed at IBP. Everyone works as a unit with the same expectations and goals.
- Clear mission. Without a defined goal, IBP cannot deliver. A specific goal sets the path for IBP and outlines what outcomes to expect.
- Alignment. IBP processes are required to be cross-functional. With lots of cooks in the kitchen, things can burn quickly. Ensuring data, processes and reporting periods are aligned as well as having the information aligned to the mission is a critical requirement. It’s also helpful to align to an overall roadmap, conquering one project at a time with the end goal in mind.
- Right talent. With people well-versed in the competencies required for IBP, like planning for supply chain, finance, and strategy, it’ll be easier to implement across every facet of the business.
- Insightful analytics. Real-time analytics like those offered by Anaplan can help with resilience and flexibility, thanks to the ability to model “what-if” scenarios, analyze data quickly, and use insights from all departments to make the right decisions when it matters.
- Powerful technology. Compiling all of this information is a daunting task, and spreadsheets just can’t do the job. An agile, cloud-based connected planning platform like Anaplan is critical to providing a central platform for IBP collaboration.
With the right foundation and tools, businesses can reap the benefits of IBP, the next level of business planning. Companies using IBP will stay ahead of the competitive curve and be better positioned to react to change, opportunities, and risks together for a greater overall return.