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Going beyond core financials

So, you’ve got polished financials statements, you’ve taken your excel process and put it into a new EPM solution to come up forecast.  Now what? It might be time to gather your FP&A team and the executive team and ask some hard questions.  What factors really drive the business?  How do you benchmark success for actuals?  What do you deem a success in budget?  Are those same factors present in your core financial package?  

In today’s business landscape, accurate forecasting is critical for successful decision-making. A driver-based forecast is a method that leverages historical data, enterprise specific ratios, and business operations to predict what the budget should be for a particle segment of the enterprise. 

In addition, modern-day forecasting is becoming more collaborative. By bringing together stakeholders from across the business, including sales, marketing, and finance, businesses can develop more comprehensive forecasts that consider the entire organization. This collaborative approach ensures that forecasts are aligned with the overall business strategy and that everyone is working towards the same goals.

Cloud-based solutions are also transforming the way businesses approach forecasting. With cloud-based forecasting solutions, businesses can access their data from anywhere and collaborate with team members in real-time. This approach also enables businesses to scale their forecasting capabilities up or down as needed, without having to invest in expensive hardware or software. 

As of late, EPM providers have added AI tools to their product offering.  For example, Planful has added Predict, this provides the ability to pre-seed a budget with what the AI engine’s think is a plausable result given historical trends.  This can then be adjusted by budget owners.  Signals another part of Planful’s product offering shows the end user amounts that are outside of the norm.  No more having to check for a fat-fingered number.  

Finally, modern-day forecasting is becoming more integrated with other business processes. Rather than treating forecasting as a standalone activity, businesses are now integrating it with other processes, operational teams and even marketing. This approach ensures that forecasts are aligned with the overall business strategy and that everyone is working towards the same goals.

In conclusion, modern-day forecasting is evolving rapidly, thanks to advances in technology and the availability of data. With a data-driven approach, collaboration, cloud-based solutions, and integration with other business data, businesses can develop more accurate forecasts that are aligned with the overall business strategy. By investing in modern-day forecasting, businesses can manage forecasting process easier with less man hours.

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