Let’s admit it. “FP&A” is cool now. It’s a hot topic. Its value is being seen in the more data-centric culture and environment that we exist in. This isn’t a bad thing. It’s great. Large corporations are pouring resources into developing their FP&A departments. 

Can you envision an FP&A department when you close your eyes? When I imagine FP&A, I dream of a team of professionals located in the campus of a large organization. They are working together with many large computer screens. The team is filled with finance professionals that know excel very well. They have some budgeting and forecasting software they use and they even know how to code a good amount. They are strong technicians in their craft and are led by a seasoned finance professional. They partner with other departments. Yet, they still dedicate themselves to FP&A work. 

But, for small businesses, this can be far from what FP&A looks like. To elaborate on why FP&A looks so different in a small business environment, allow me to share some more personal examples with you. My examples stem from my own company and our sister company that has a colleague of mine in a Director of FP&A role. 

In my role, FP&A work makes up about 15% of my annual time per year. My other time involves managing accounting, supply chain operations, and our software apps. Our FP&A department is a fraction of a person in our firm. To be frank, FP&A is important in our organization, but it has to completed efficiently. Also, I don’t have a single analyst reporting to me. I have pure accountants that focus on posting transactions, rather than analyzing and forecasting. Even though we are undertaking automation projects to free up time, what I am seeking to say is that there aren’t a lot of resources available to FP&A.

My counterpart in our sister company is the Director of FP&A for her firm. She spends over 25% of her time managing accounting software fixes and upgrades. At least another 25% she spends on process implementations and the training and development of employees. In summary, FP&A in a small sized business tends to live in a single individual and serves as a just fraction of that person’s duties. 

FP&A in a small sized business is different than in a large, corporate firm. While one can argue that we all face a lack of time and resources, there often is no dedicated FP&A function in a smaller enterprise. FP&A team members in a smaller firm are wearing many more hats than FP&A. Again, we don’t have too many people that report to us (if any) that are analysts. 

But, FP&A is a critical function in any business. Without it, you can’t make knowledgeable pricing decisions that allow for successful margins over costs. You can’t forecast future cash flows to determine if you will meet your banker’s covenants. You can’t run a scenario analysis of different investment options. The list goes on.  

So, how does FP&A be successful in a small business environment with a complete lack of time and resources? The top 3 key steps are below:

1. Focus on immediately building a KPI scorecard with your leadership team. A KPI scorecard doesn’t sound like a very FP&A type of task to you? I argue that it is though and allow me to explain. By building a company KPI scorecard, you will work with key stakeholders to define the key metrics that drive the business. You need their insight to define these metrics.  By engaging in the task of scorecard development, you learn immense amounts about the key business drivers.
   
   Armed with this info as an FP&A professional, you can build better, stronger financial models and forecasts. Thus, you should focus on building a KPI scorecard and review it weekly with the company stakeholders. Your forecasts will be more accurate through a better understanding of the business. You will also spend less time trying to make assumptions on the business drivers. You are delivering value to your stakeholders by building the scorecard to offer them the metrics they need. You do this and it helps you better understand the business to build models. Two birds and one stone. 
    
2. Delegate your analysis and excel tasks to independent contractors or virtual assistants. Agility is key here. Hire these people when you need them. The internet is full of resources that allow you to do this. Again, I don’t have a direct report that only does analysis work. I have only pure accountants reporting to me. I hire virtual assistants and excel experts as independent contractors on an as-needed basis to help me do data analysis. Again, in a small business environment, we are expected to be a jack of all trades. So, you don't develop expertise levels quite as easy.  
   
   I don’t have the time to develop a complex Excel macro that I know will help me a lot with some of my continuous data analysis. Instead, I hire someone on Fiverr or Upwork to develop it for me. I then focus on obtaining insights from the analysis, rather than spending my time on data clean-up. I have hired a person on Fiverr for $80 that built a macro for a report my team distributes on a monthly basis. It would have taken me $1000+ of my time to develop that same macro since I’m not an expert in macro development. In summary, delegate and consider using virtual assistants and experts on task platforms. 
    
3. Be a part of your company’s close process. In a small business, a couple of people perform all closing tasks, and sometimes it might be only one person. If you are not that person or on that team, be sure you sit with these people to understand as much of the different transactions taking place that you can. You will then know how to forecast the effect of such transactions with your knowledge. The great part about being in the mix of the close process of a small business is that you get to see and understand every transaction. 

The above-mentioned ideas are tasks that need upfront time and investment from any FP&A professional. For example, delegation to a virtual assistant requires the development of a detailed SOP up front. Once you have put this work forward though, your time is freed up to focus on obtaining insights from your company’s data, rather than cleaning it. What I have mentioned applies to FP&A professionals in any size firm, but these ideas allow a small business FP&A to be extremely effective.