The Finance lifecycle is a complicated one, and CFOs are often in search of ways to simplify the process while maintaining, or even improving accuracy.
In a recent webinar, "Unlocking the Secrets to Finance Transformation," panelists sat down to discuss ways in which enterprise performance management (EPM) software can be utilized to improve upon the finance cycle, the goal being to streamline and shorten every phase within the cycle.
EPM Software Can Drive Efficiency and Accountability
Enterprise performance management (EPM) software can be used to automate key financial processes, guiding users through the financial lifecycle of modeling, planning, closing, reporting, and analyzing. With the use of EPM software, organizations can improve efficiency, ensure a higher level of accountability throughout the organization, and gain actionable insights into their finances which inform smarter financial decisions.
What's New with EPM?
The basics of EPM haven't changed over the last decade, but the environment in which organizations operate has changed significantly. Global competition has increased, new regulatory requirements have been introduced, products have shorter lifecycles than ever before, and big data has exploded throughout the business world. With these massive changes in business operations, businesses need new methods of managing finances that can keep pace with their rapidly changing environments.
The Top Priorities in EPM
With the rapidly fluctuating nature of businesses and the higher demands on organizations, it's no wonder that many are seeking changes in their financial processes. According to recent survey data presented in the webinar, 55 percent of organizations view planning and budgeting as their primary EPM priority, with 48 percent saying reporting and disclosure is their top priority. More than half of the organizations report that they are still relying on Excel to conquer their EPM requirements. The research found that inefficiencies were rampant throughout the budgeting process, with about one-quarter of respondents saying their budget cycle takes longer than 4 months.
The Biggest Challenges in Budgeting and Planning
Budgeting and planning inevitably presents challenges to businesses, some of which serve as greater obstacles than others. According to panelist Janet Golla, the Vice President of Planning and Analysis at Capitol Petroleum Group, the biggest difficulty her company faces is oil market fluctuations, which are often unpredictable. Trying to understand where the market is going, but having no influence on it, is exasperating and makes it incredibly difficult to accurately plan and forecast. She says that while it's possible to gain a general sense of where the market is going, major events like Hurricane Katrina could disrupt the entire financial plan.
Best Practices for Increasing the Efficiency of Annual Budgeting
With so many companies still struggling with budget cycles that exceed 4 months, honing in on optimizing efficiency is essential. Panelist Brad Tingey, the Corporate Controller of Golden State Foods, says that his team has found standardization to be key in improving efficiency, and it can also help to mitigate challenges like employee turnover. He also said it's critical to implement a budgeting project plan which holds employees to a specific timeline for completion, so everything is accomplished within an allotted timeframe.
How Can Cloud-Based EPM Applications Streamline Budgeting and Planning?
A cloud-based EPM platform can significantly improve the efficiency of budgeting. Tingey remarked how the cloud can promote a single version of the truth by enabling his team to compile all data in one place. With his company consisting of numerous operations worldwide, having that common place to consolidate data was essential. For Golla, her team has noticed that the cloud has greatly enhanced reporting efficiency. She no longer has to gather countless spreadsheets from multiple sources, as data is quickly consolidated in the cloud, thus streamlining the reporting process.
Enterprise performance management hasn't changed that much over the years, but the environments of businesses are changing rapidly. In order for businesses of today's world to keep up with increasing demand, competition, and fluctuating market trends, they need a reliable and consistent approach to planning and reporting. A cloud-based EPM platform provides the solution, enabling businesses to consolidate data and greatly streamline key financial processes.
To learn more, watch the complete webinar, Unlocking the Secrets to Finance Transformation.