Do you or your organization suffer from a lack of focus during your planning, budgeting, forecasting and reporting exercises?
The other day, while I was watching my five year old son's indoor soccer game I noticed that I was following the action in the wrong game? Why? The reason is simple enough, my son was playing a field over and the spectator stands are only available on one side of the field, which meant that I had to keep my focus on the second field instead of the game being played right in front of me!
I believe that our planning and reporting can suffer the same 'lack of focus'. It can occur for a few reasons, including:
- Spending more time collecting and organizing data than analysing the data
- Budgeting/forecasting at an inappropriate level of detail, effectively drawing our focus from key business drivers that should receive more relative focus and giving equal weight to administrative expenses
- Routinely generating, reviewing and analyzing a standard set of reports, as opposed to interacting with the data and performing 'ad-hoc analysis' on key areas and variances
This is the final blog entry in a 3 part series on combining financial & operational models to link key business drivers to budgets & forecasts. Click here to review part 2 or part 1 respectively.
Combining operational models that link key business drivers with your financial budgets provide the following results:
- Significantly shorter budget/forecast cycles
- Facilitates market environment vs. calendar driven re-forecasting to react to quickly to changes
- Re-aligns financial planning focus
- Facilitates insight between operational tactics and the financial forecast
- Facilitates variance analysis at the operational and key driver level
- Shifts professional resource time from collecting data and maintaining spreadsheets to analysis and decision making
Please browse this autodemo for an overview of Prophix CPM, a solution that can facilitate sophisticated operational modelling.
This is part 2 of a 3 part series on combining financial & operational models to link key business drivers to budgets & forecasts. Click here to review part 1.
So, how should you go about building financial budgets with live linkage to operational models?
- Shed disconnected, error prone and broken-linked spreadsheet models popularly referred to as 'Excel hell'
- Leverage technology to:
- Eliminate manual processes used to 'link' operational data
- Enable variance analysis at both the financial and operational model level
- Leverage manager and professional/analyst resources by having them focus on higher-value work (i.e. rather than compiling data)
Please browse this autodemo for an overview of Prophix CPM, a solution that can facilitate sophisticated operational modelling.
For many smaller organizations with simple budgeting/forecasting needs, Excel works just fine. However, as Dilbert points out below, there are certainly drawbacks to using Excel:
For organizations with more complicating needs, the value of a using a dedicated CPM solution for budgeting/forecasting and financial/management reporting are myriad, including:
- Simplify and better control the budgeting process
- Reduced administration of the budgeting cycle
- Increased collaboration
- Real time version control
- Mitigate speadsheet ‘mis-calculations’ and ‘overrides’
- Better manage security
- Historical tracking/audit of changes
- Integrated financial/management reporting solution to facilitate variance reporting
- Simply reforecasting administration
With Microsoft's recent release of the Forecaster Data Transfer Tool, a 'missing link' in the Microsoft CPM solution has been delivered.
This is excellent news and means that we no longer have to rely on a manual Excel based method to feed Forecaster data into Dynamics GP. Instead, this process can now be automated.
It also allows Management Reporter to report on Forecaster data via Dynamics GP versus directly as can be done in FRx.
Best of all, this tool is free!
For more information, visit the Microsoft Dynamics CPM blog or CustomerSource.
Note: The tool is compliant with GP2010.
