Rethinking the Budget Process

Increasing Time for Management Review

January 29, 2021

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Proactive Decision Making

Latest Budget Tech has three core advantages. It enables broad departmental or holistic collaborations to drive higher quality data submissions. It ensures data integrity exists at all times, whether spreadsheets are used or not. It ensures that your systems work for you and not vice versa. The end result is that processes are auditable, repeatable and transparent, as well as timely for proactive decision making.

 

Confidence vs Time

The common challenge today is that budget activity is incremental to your already full workloads and the core issue is to spend more time on those detailed budget management reviews, so that quality detailed budgets with strong supporting information can be submitted punctually with much more confidence. Today a lot of time is consumed and wasted on the underlying processes associated with data transformation within a system, as well as spreadsheet cell management, meaning that information lags reality.

 

Totting Up the Effort

Loss of time associated with the process is also being replicated within each operational entity, so the impact re hours spent is being multiplied many times over.

 

Driving Efficiency

Turning that time allocation effort on its head, means that resources can be freed in multiple places, both within and across operational entities, resulting in a positive cascading resource impact for your business.

 

Eliminating Lost Time

Budgetary processes for transactional flows, controls and management activities tend to require extensive data transformation and combinations across applications, and is the core reason why speed is lagging and slow regarding execution. Solving this removes underlying friction to produce actionable, contextual and timely reporting flow outcomes.

 

Granular Process Definition

Regardless of budgeting approach, ie zero based, top down or bottom up etc, think of budgeting solutions of this type being packaged not at an application level, but at a process level on an end to end basis, and always with full data integrity. In other words from data collection through all required ultra-granular transformations, to ranked reporting @anytime @anywhere within a process, plus potential to undertake deep simulations. Different data types are supported ie footfall, ESG data etc.

 

Segment Reviews

Consequently, aggregating or consolidating segments by currency or vertical activity becomes easier to perform on an auditable and repeatable basis. Timely execution also provides deeper forward and backward visibility, and can be combined with the enrichment of transaction metadata. Simulation can find optimum product mix for cash generation etc.

 

Less Complexity & More Sophistication

Levels of complexity can be added when needed, as opposed to being there at the start. Process owner(s) has overall granular control including compliance. The process user has a simplified experience that also facilitates collecting the right level of information.

 

Achieving Full or Partial Automation

Typically, corporates want to iterate and improve budget processes. Therefore, at the beginning it is normal for deployments to be less automated with more of your specific checks and balances being in place, but as confidence is built or engineered into the solution from Day 1, both full and partial automations, even with an eyeball review for quick checks from experienced staff, are possible.

 

Timely Visibility

Repeatable, auditable compliant transactional flows for actuals and budgets are the key to saving time. As processes are ultra-granular they are agile, flexible and extensible, and enable the end to end flows to be completed quickly to keep all on track. Examples:-

 

  • Rolling budgets and forecasts backwards and forwards. Ability to auto rank entity or regional variances with specific actionable, contextual outcomes eg transactions over $XXX dollars and representing 50% of the total variance etc
  • Corrective actions to stakeholders for fast or slow moving stocks
  • Segment analysis (customers, products etc) in consolidated statements by toggled currency, FX reconciliations etc
  • CAPEX schedules that capture supplemental information ie ESG characteristics, insurance details etc
  • Allocation transparency can show the source of data, plus calculation detail making it easier for source data traceability thru the various iterations etc.
  • Supporting processes can ensure within budget execution

 

Pushing Towards Continual Budgeting

Continuous business planning and predictive forecasting provides timely visibility, as well as transparency, for corrective actions. Today’s technologies bring simplicity and sophistication with or without spreadsheets to achieve this goal iteratively during these challenging times to facilitate the consistent aligning of budgets with strategy.

 

FlexSystem is a business software vendor to 1 in 10 Forbes Global 2000 (May 2020) and 1 in 5 Global Fortune 500 (August 2020), operating at the intersection of new process and payment technologies to provide you with iterative opportunities for value creation with or without AI at both gross and net margin levels.

 

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