A groundbreaking survey designed to benchmark current and emerging trends relative to how companies are leveraging technology and empowering FP&A professionals to unlock the strategic value of FP&A.
The role of the CFO is changing: It’s moving away from compliance and optimization, towards a more strategic; customer facing disruptive role. But how empowered are their FP&A teams to support them in this new world?
The goals of this survey are to identify and analyze current and emerging trends in modern Financial Planning and Analytics.
by Michael Coveney, co-author of "Budgeting, Planning, and Forecasting in Uncertain Times"
A few days ago I was looking through some blogs on LinkedIn when I came across a comment that suggested the purpose of budgeting was to set stretch targets. A number of people seemed to support this idea, although I personally have to disagree for two key reasons.
What is a stretch target?
First of all, what is actually meant by a stretch target. This can differ depending on where you sit. As the budget holder of a sales division, this may mean setting sales targets that are higher than what would normally be expected. For production, this may mean producing more goods for less while marketing may see this as attracting more inquiries than last year....
By Chris Ortega, MBA, Sr. Finance Manager at Emarsys, USA
What ignited this article? I was talking with some upcoming college graduates from a similar background as myself. They were looking to go into corporate finance/financial planning & analysis (FP&A) after graduating from the Kelley School of Business at Indiana University. I shared with them lessons I learned from 10 years in the finance game. Why is this important to you? In discussing with them and seeing their reaction/feedback it was clear others could see value in my perspective.
So, here are my Top 5 lessons learned in the first 10 years of my professional career.
The CEO walks into the CFO’s office and says, “You need to take more ownership of the customer experience and the professional development within and beyond your team.”
Even a few years’ ago many CFOs would have thought, and some still might think, is that the beginning of a joke? CFOs are not known for superior soft skills or effective collaboration beyond the walls of Finance. However, the challenges and opportunities facing companies are ever evolving and complex, and as such the role of the CFO need to evolve in step for a company to deliver innovation and realize sustainable growth.
Framing is how situations are presented to people. How situations are presented affect the decisions that people make. Framing has a role in the work of FP&A practitioners.
FP&A practitioners can work through narrow frames. Narrow frames can appear on income statements through revenues from specific products, executive salaries, and equipment depreciation. Narrow frames can appear on balance sheets through work in process inventory, interest payable, and common stock. Narrow frames provide an opportunity for FP&A practitioners to employ a bottom-up approach to their work. Employing this approach improves the ability to be precise in areas like financial plans.