Malcolm Brock

Managing Director

These are the national and global outcomes of many deeper issues that face organisations as they navigate the repercussions of a global pandemic and a major war in Europe. Just a small selection of recent press headlines paints a rather grim picture of the outlook:

FT: Banks warn of grim prospects for pound as economy slows

Bloomberg/Aljazeera: German inflation hit another all-time high in May

CNN: Global economy faces ‘its biggest test’ since WWII

I won’t go on. I am sure you already get the picture!

This is at the global and national economic level. Organisations see these trends in terms of more micro-economic factors which affect their business both today and into the medium term. Labour shortages, wage increase pressure, supply chain shortages, materials cost increases, soft markets for goods and services and right now the big one is spiralling energy costs. With all this going on financial planning and analysis can really become a nightmare as organisations try to work out what is the best thing to do to keep them on a sound financial footing. Oh, and of course it all just changed at the point it was being finalised!

For many this situation is made worse by the processes and technology they use to manage their financial plans. Yes, there are some organisations out there who still struggle on with spreadsheets and there are also many who are using inflexible legacy systems that make the job much harder and less effective than it needs to be. Modern Cloud based financial planning and analysis solutions can really help to get to grips with the realities of today. Take a look at what one of our clients, Anchor – a not-for-profit housing and care provider, has achieved by moving to cloud based solutions.

This brings me to where I started – driver-based financial planning and analysis. Why is this so important? As organisations grapple with constantly changing micro economic factors they need to quickly understand their impact and make the necessary changes. This process starts with financial planning which needs to be done accurately and quickly. It must be so much easier when many of these micro economic factors are set up in the plan as drivers that help generate the overall numbers. Adjust a few drivers and you have a new plan! I know it is not as simple as that, but I am sure you get the idea. Wading around in rows of financial numbers making changes is sure to take time and lead to mistakes being made that go undetected.

Setting up a financial planning and analysis solution in this way takes skill and experience, both technical and financial, but from experience I can tell you it pays dividends in the future. Often integration with existing systems to acquire the information needed for these drivers in the financial planning and analysis process is key to this. Here Cloud solutions really come into their own as they provide extensive and comprehensive integration technology to achieve simple and timely integration processes.

So, what drives your business? I am sure you can tell me the key factors but are these imbedded into your financial planning and analysis? Why not make contact via linkedIn or the contact page on our website to discuss how driver-based planning could help you to achieve your organisational goals.

Until next time.

Malcolm