Heuristics are rules of thumb.  Psychologist Gerd Gigerenzer believes heuristics are a necessary part of an individual’s decision making process.  Heuristics can be used in FP&A as a way to make decisions about how organizations earn revenues and incur expenses. Here is a heuristic that I use to make decisions about how organizations earn revenues:

The dusk of Management Taylorism is the dawn for the strategic CxO. Constant cooperation, communication and deep business process knowledge are the answer to digitalization, data lakes and disruptive threats. The opportunity for Finance is to extend resource allocation and financial planning towards becoming the trusted strategic advisor beyond the mere financials. How can FP&A support this achievement? 

A purpose of FP&A is to help people acquire insight into how organizations function.  People acquire insight from a variety of sources; they can acquire insight by reading reports, talking to people, or walking through facilities.  A reason people choose a certain source to acquire insight is accessibility and as a result FP&A practitioners should make their insight accessible. 

The concept of ‘Beyond Budgeting’ has been around for nearly twenty years now. Although it has helped transform many businesses and has become part of mainstream management thinking in some parts of the world, I talk to many business people who have still not heard of Beyond Budgeting.