When it comes to planning and budgeting methodologies, integrated business planning (IBP) is the nirvana that many organizations aspire to. At a time when corporate agility and a deep insight into business performance are paramount, its attraction is that it weaves together all the disparate strands of strategic, operational, and financial planning that are typically managed today in a plethora of stand-alone spreadsheets and siloed applications into a single system.While organizations can incrementally work towards full integrated business planning by first introducing driver-based models for all forms of planning and budgeting, then linking them together, achieving fully-functional IBP can still prove difficult. The main issue is that until recently there were no solutions that allowed companies to follow an evolutionary path and grow into IBP. The only alternative was for companies to set out on an expensive, enterprise-wide implementation on the scale of a full ERP replacement. Understandably, most organizations parked the idea and made do with other tools. Today all that has changed. Platforms such as Anaplan provide functionality for all aspects of financially-orientated enterprise performance management (EPM) along with sales and operations planning (S&OP) and all other facets of enterprise planning. This allows finance professionals to collaborate with their colleagues in other lines of business and steadily work towards the common goal of integrated business planning, and deliver transformational benefits in terms of agility and insight, which are sought after capabilities in today's uncertain world.
Essential functionality in integrated business planning softwareThat is not to say that implementing integrated business planning is now a walk in the park. It still involves manipulating and managing a huge amount of highly variable data – everything from pack sizes, through individual employees to organizational structures. It is not just big data, it is rapidly changing data too, so models need to be constantly replenished to stay aligned with changing inventory levels. The assumptions that underpin the business rules that connect strategic, operational and financial plans are constantly changing too. They also need to be easy to flex so that users can analyze the outcomes of different scenarios before committing to a particular course of action.If finance and operations are going to share a single planning and forecasting platform to deliver integrated business planning, then it needs to meet these exacting requirements by providing these three critical elements of functionality:
- User-Friendly Modeling: Embedded modeling logic that users can manage themselves is essential. That way with a few clicks, no coding and no dependence on IT, users can adjust business rules, update drivers, and refresh dimensions and hierarchies.
- Process A Lot Of Data: The ability to process large volumes of data across multiple dimensions is also key. Data is growing by the second, across the world but also within individual businesses. The ideal system can grow with you, handling millions or billions of pieces of data, without you having to rip and replace when your company grows as big as you want to be
- Immediate Ripple Effect: Beyond just data roll-up, you want real-time calculation so changes instantly ripple through all connected plans to reveal the impact right across the enterprise – all the way to the profit and loss account and cash flow forecast.
Keyword: Integrated Business Planning