Board: 12 best practices in financial planning and analysis
Most CFOs are not happy with their Financial Planning and Analysis process, believing it
delivers too little value and eats up too many resources. As a result, they often ask:
"What are the best practices in FP&A?"
To date, the answers have been based on conventional wisdom, anecdotes, and popular trends propagated by finance magazines. What’s been lacking is hard data…
until now. The Institute of Management Accountants (IMA) and I developed a survey that more than 700 organizations around the globe participated in. What made this survey different was the approach it took. Previous research focused on a particular methodology, then worked backward to find success stories. The IMA survey instead focused on what the most successful organizations are doing differently from everyone else when it comes to FP&A. These successful organizations consistently meet or exceed their targets, and they consistently meet or beat their competition. Hard to think of a single CEO who wouldn’t crave those results (which, by the way, guarantee their bonus). These most successful organizations tell us that their Financial Planning & Analysis process:
- Drives Shareholder Value (or business value if privately held)
- Drives execution of the strategy
- Provides the mechanisms to ensure the financial and operational goals of the organization ar achieved
- Builds organizational awareness of the strategy and each department’s role in achieving it
- Ensures the optimal allocation of resources
- Ensures coordination of initiatives, projects and programs
Again, what CFO, or CEO for that matter, wouldn’t want that? The question though is how these best managed organizations were able to achieve these results. What’s in their drinking water? This guide lets you in on their secrets, running through the 12 best practice principles for FP&A.
Read the full report above.