Achieving the best-in-class Financial Planning and Analysis (FP&A) necessitates the integration of strategic, operational, and financial planning through a holistic approach known as Extended Planning and Analysis (xP&A). This approach enhances collaboration across departments in an organisation.

The FP&A Trends Maturity Model serves as a valuable resource for FP&A teams seeking this integration. It provides a structured framework for transformation based on insights from senior practitioners, thought leaders, and the International FP&A Board members. On October 9, 2024, finance professionals were brought together at the FP&A Trends webinar to explore how to navigate the business environment with the help of the FP&A Trends Maturity Model on the journey to xP&A.

IMC's Case Study on Strategic Evolution in Financial Planning and Analysis

Paul Nowicki, CFO at IMC, presented a case study on the evolution of FP&A at his company. Founded in 1989 by two traders from the Amsterdam Equities Options Exchange, IMC anticipated the shift from floor trading to electronic trading. Today, it is a global trading firm with over 1,500 employees.

Nowicki shared insights into IMC’s comprehensive FP&A framework, which they have expanded into Business Planning and Analysis (BP&A). The process begins with gathering company-wide data into a centralised platform, identifying key business drivers, and using real-time data to inform strategic decisions. As a trading firm, IMC emphasises the importance of real-time data in reacting to market changes swiftly.

A key aspect of IMC’s planning strategy involves cross-functional collaboration. For instance, Nowicki highlighted how the company integrates FP&A with HR to forecast employee growth, recruitment, hiring plans, and IT, risk, legal, and compliance teams for budgeting and forecasting. This holistic approach ensures that planning is not merely a finance function but a company-wide exercise.

Reflecting on IMC’s maturity in FP&A, Nowicki described the company's evolution over the past 12 years. Initially, they focused on establishing a financial budget and Key Performance Indicators (KPIs) to drive revenue planning. As of today, IMC has advanced to the second-generation BP&A system that incorporates Machine Learning, regression-based KPIs, and automation across various processes, including workforce planning, capital allocation, and cash flow management.

They aim to delve further into the potential of Artificial Intelligence (AI) and Machine Learning to make forecasting more automated. IMC also concentrates on scenario-based planning to better prepare for an uncertain global market environment.

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In conclusion, IMC’s data-driven approach and continuous innovation in planning processes enable it to remain agile and competitive in a fast-moving market. Nowicki’s presentation underscored that technology, data, and collaboration are at the heart of IMC’s financial strategy, driving growth and operational excellence.

Adoption of Extended Planning and Analysis (xP&A)

The first polling question posed to the audience was about adopting a cross-functional extended FP&A (xP&A) strategy. The poll results were quite balanced:

• 35% of respondents indicated they had already moved toward adopting the strategy.
• 33% report they are undergoing the process of updating their structure and tools to move in that direction.
• Another 31% indicated that their organisation may adopt the strategy in coming years.

Paul Nowicki provided feedback, expressing no surprise at the evenly distributed results, and encouraged those in the third group to continue progressing toward adopting a cross-functional xP&A strategy by using available tools and resources.

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The Role of Soft Skills in Enhancing xP&A Maturity: Insights from Lindström's Business Partner Academy

Evgenia Elezova, Head of Finance at Lindström, discussed the critical role of soft skills in the cross-functional Extended Planning and Analysis (xP&A) journey at Lindström. Lindström is a 176-year-old textile rental service company based in Helsinki that operates in 23 countries across Europe and Asia. Known for its commitment to sustainability and the circular economy, the company is currently undergoing a transformation.

She underscored that Lindstrom’s finance function operates through a centralised group structure supporting regional finance and business control teams. These regional teams focus on Business Partnering and value-added analysis, while centralised functions manage core processes such as financial reporting, forecasting, and data analytics. Lindström continues to progress through areas of the FP&A Trends Maturity Model, such as process, data analytics, technology, and Business Partnering. While the company excels in soft skills, it is still developing its technological capabilities as part of an ongoing transformation.

A major focus of Evgenia Elezova’s presentation was the evolving role of business controllers. At Lindström, business controllers are expected to be "finance superheroes" with deep knowledge of business strategy, markets, and processes, alongside technical skills in data management and analytical tools. Soft skills such as communication, storytelling, and influencing are essential, enabling business controllers to transition from data providers to management co-pilots. These skills allow them to respond to changes rapidly and translate analysis into actionable insights.

To support this transformation, Lindström launched the Business Partner Academy (BPA) in May 2023. The BPA aims to develop people’s capabilities at all organisational levels by offering practical, hands-on learning to allow them to become trusted Business Partners. The first cohort includes 26 participants from 13 countries who engage in monthly sessions guided by teams from business operations and Business Intelligence. The program emphasises real-world application as participants work on local business cases and scenarios.

The BPA not only develops technical and strategic skills but also focuses on soft skills. For example, they practise dedicated sessions on areas such as communication and influence. Participants receive personal mentoring, coaching, and 360-degree feedback throughout the two-year program to track their progress.

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Lindström has expanded the BPA into its second year, concentrating on project-based learning where teams of controllers support company strategy. This hands-on experience, paired with continuous learning and mentoring, ensures that Lindström’s business controllers are well-equipped to add value.

Elezova emphasised that creating an enjoyable learning environment is a core principle of the BPA. She concluded the presentation by showcasing photos of the team’s gatherings, reinforcing the importance of having fun while advancing professionally. This comprehensive approach to Business Partnering and skill development underscores the significance of combining technical expertise with soft skills required to succeed in the xP&A journey.

Where Are We on the xP&A Journey?

The second polling question asked participants about their next step in the Extended Planning and Analysis (xP&A) journey.

The results showed that:

• 36% prioritised updating driver-based models
• 23% focused on implementing technology
• 18% emphasised aligning people
• 16% aimed to create an xP&A vision
• for 7%, harmonising data was the main priority

Evgenia Elezova commented that it was encouraging to see many focusing on driver-based models and noted there is no one-fits-all approach, so businesses can either start with people or technology based on their unique journey. She appreciated that many participants have already been progressing in their xP&A development.

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Unlocking the Power of xP&A: A Roadmap to Success

In the final presentation, Justin Croft, Vice President of Solutions Architecture at QueBIT, discussed the critical role of technology in the Extended Planning and Analysis (xP&A) journey. He emphasised that finding a perfect intersection of financial planning, operational planning, and advanced technologies like Artificial Intelligence (AI) and Machine Learning (ML) is essential for organisations seeking to enhance their planning.

Merging Disciplines for Greater Insight

Croft highlighted that many companies often begin their journey from either financial or operational planning. However, the real benefits arise when these disciplines merge, leading to faster insights, improved accuracy, and enhanced collaboration across departments. He presented a roadmap for organisations to follow as they expand their xP&A processes, beginning with soft skills and team alignment to moving toward defining success criteria and conducting discovery sessions to gather requirements.

Blueprint for Implementation Extended Planning and Analysis (xP&A)

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Croft provided a detailed blueprint of Extended Planning and Analysis (xP&A) use cases, categorised by function, to help businesses prioritise them based on their unique needs. He encouraged attendees to adopt this roadmap for successful implementation, which includes evaluating technology options that align with their strategic objectives.

Case Study: Transforming Demand Planning at Arthrex

One noteworthy example discussed was Arthrex, a global medical device manufacturer. By reinventing its demand planning process, Arthrex reduced their planning cycle from 15 days to just one. This transformation enabled more dynamic Scenario Analysis and improved decision-making capabilities.

Evaluating Technology for Extended Planning and Analysis (xP&A)

Croft shared key considerations for evaluating technology solutions within the xP&A landscape. He stressed the importance of data management and scalability, especially as organisations expand beyond finance into operational planning. Flexibility, the incorporation of data science, and user-friendly data visualisation and reporting capabilities are also critical for user adoption.

In conclusion, Croft underscored that organisations embracing xP&A become more responsive, accurate, and profitable. However, he cautioned that there was no one-size-fits-all approach. Each organisation must craft its unique journey, carefully considering what matters most.

Transformative change requires significant planning and commitment, but the long-term benefits can be substantial. He encouraged attendees to explore the information presented and consider how they can advance their own xP&A processes.

Key Takeaways from the Webinar

The panellists collectively emphasised that achieving higher maturity is a gradual journey that necessitates time, clear vision, and involvement of personnel, along with the establishment of effective processes and integration of adaptable technology. They highlighted the importance of developing talent to leverage these technological advancements and underscored the role of the FP&A Trends Maturity Model as a valuable tool for identifying areas of improvement. Furthermore, they encouraged professionals to perceive Extended Planning and Analysis (xP&A) as essential for FP&A teams. They also underscored that Strategic Planning and ongoing development are vital for organisations to navigate their xP&A journeys effectively.

This webinar was proudly sponsored by QueBIT.

To watch the recording, please follow this link.