Today’s uncertain times mean that it is no longer good enough for organizations to have one fixed plan and forecast. Historic data by itself cannot help predict the future, nor can classical planning methods and standard variance analysis provide sufficient information to manage a business. It is time to change and adopt a fact-based mindset towards business decisions.
There has never been greater uncertainty and a faster pace of change than over the past months.
And yet, at a time that requires speed and agility, and in a function that needs these qualities more than others, we cleave to our traditional management accounting methods and adhere to our longstanding processes.
Financial planning and analysis (FP&A) functions are at the forefront of guiding organisation
By Ron Monteiro, Founder at KICT Inc
We all have these horror stories where we have all sacrificed our personal lives during this challenging ‘Budget’ season. I guess they say that what doesn’t kill you makes you stronger. I personally think that there are several ways to make your lives better during this period.
The vast majority of companies still rely on traditional organisational designs characterised by hierarchical structures, and steering with budgets. But these designs are outdated, severely limiting a company's ability to act and respond in today’s fast-changing environments.
How can organisations operate viably in this age of uncertainty?
One of the biggest barriers for organisations to increase agility comes from unaligned top-down and bottom-up planning processes.