Finance professionals need powerful tools that will aid their ambitions and help fulfill their corporate goals and keep them ahead in the game. This tool is data. The processes to convert their data into insights are becoming time-consuming, labored, and expensive and unless they have access to absolute and accurate data on a timely basis across the company, teams will have to conduct mundane and reactive budgeting instead of evaluating future risks and opportunities for the company. IFP facilitates collaborations and gives finance professionals access to data to help in the decision making process. It becomes possible to identify the ways to deliver the maximum amount of impact across the company and result in a more profitable, efficient company.
The Challenge that Integrated Financial Planning AddressesIntegrated Financial Planning (IFP) combines data and planning processes in the company across all departments, units and locations. This becomes possible once unifying technologies such as Corporate Performance Management software is leveraged to harness all processes and data complexities. IFP is more relevant for CFOs when compared to rudimentary planning because it isn't limited to budgeting. IFP makes it possible to conduct long-term financial, operational, and strategic planning for finance professionals along with enabling planning and budgeting at a much higher level. This way, CFOs can build a more detailed image of the impact of their decisions and can also evaluate short and long term activities better.
How to Adopt Integrated Financial PlanningIFP does not need a long-range implementation program for adoption because IFP enabling technology can easily and quickly demonstrate a lot of benefits for CFOs through the following:
- The focus should be on financial planning or budgeting which is generally aimed at the general ledger level of detail, which includes monthly forecasting, rolling forecasts and more
- CFOs should also focus on revenue-related processes and data so that they can come up with more accurate plans. These should include billings forecasts and actual revenue recognition.
- IFPs should also direct their focus on their production, product cost, its profitability, and more. This is mainly applicable in manufacturing.
- IFPs help CFOs in making more accurate predictions for their future budgeting
- It helps with risk assessment for companies as well
- It enables financial professionals to create data driven analytics which help in making better informed decisions with regard to the company