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FP&A Analytics

Utilizing Technology in FP&A

By Karl Kern, Founder/President, Kern Analytics LLC

This article  addresses technology in FP&A.
In his book "THE INNOVATORS" Walter Isaacson describes two ways of utilizing technology.  One way is artificial intelligence, machines thinking on their own.  Another way is augmented intelligence, people using machines to help organize information.  Both ways are seen as improvements in our ability to make better decisions.  The ability to make better decisions is an important part of FP&A. 
I see artificial intelligence in FP&A.  

FP&A: the Evolution of Driver-Based Planning

By Larysa Melnychuk and  Hans Gobin 

Driver-based planning (DBP) is an essential part of the financial planning and analysis (FP&A) armoury, enabling organisations – ranging from the smallest non-profit to a multinational – to become quicker, more dynamic and agile in their planning and in responding to internal and external changes in the business environment.
DBP was the focus on the London FP&A Board of senior practitioners’ most recent meeting, sponsored by Michael Page and Metapraxis, which was held on the eve of the landmark UK referendum on its continued membership of the European Union (EU). Given that the result early on June 24 confounded many expectations, the benefits of DBP may have been evident to many companies forced to reassess both their short-term and longer-term business plans.

This article outlines the main conclusions and recommendations on DBP that were generated by the London FP&A Board.

Data Driven Planning: The 7 Key FP&A Models

by Michael Coveney, co-author of "Budgeting, Planning, and Forecasting in Uncertain Times"

In this article, I want to make the case for data driven planning to describe the 7 key FP&A models that every organisation needs to plan, resource and monitor business performance.

From a planning and review perspective, there are 7 key things that management needs to know about its business processes, each of which can be assessed in a range of analytical models:

  • How efficient and effective are the organisation’s business processes? (Operational Activity Model)
  • What trends are ‘hidden’ in the detail? (Detailed History Model)
  • What long-range targets should be set given where the market is heading? (Target Setting Model)
  • Where is the organisation heading if it continues with its current business model? (Detailed Forecast Model)
  • What could be done differently to better meet long-range targets and how much would it cost? (Strategy Improvement Model)
  • What choices/risks do management face and what would be the impact on corporate goals? (Scenario / Optimization Model)
  • How much funding is required to implement the plan and where will it come from? (Cash / Funding Model)

The models that answer each of these questions have different content, structures and are used by different people at different times.  However none can be omitted or ignored, and all need to operate as a single, data-driven management system.

Financial planning and analysis: a blueprint for analytical transformation

by Graham Buck, GTnews
This article was published first on gtnews.com

Two-and-a-half years since its formation, the London Financial Planning and Analysis (FP&A) Board is setting itself ambitious goals.

The Board has acquired two official sponsors; Michael Page, the specialist recruitment firm, which now provides its central London office as the venue for Board meetings; and Metapraxis, the consultancy, analytics for financial professionals and software provider.

For its 10th meeting, held in mid-March, Board members embarked on developing a generic blueprint for FP&A analytical transformation and an advanced FP&A analytics maturity model.

What are the basic ingredients of advanced FP&A analytics? Getting the discussion underway the Board’s founder and managing director, Larysa Melnychuk, suggested that it should be proactive, forward-looking, agile, available in real-time, multidimensional and integrated – although these elements are no more than the basic essentials.

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