Faced with the challenge of transforming of transforming FP&A from a back-office function into the driving strategic force, interpreting the strategical innovation and applying it to your business can seem like a challenge, but Director of Financial Planning and Analysis at Intertek, Olga Corbett, believes she has the answers.
But, how do you harvest the right data for FP&A applications? What qualities do competent FP&A professionals need? And, what problems has the process’s implementation thrown up? With all these questions and more on the tip of our tongue, we caught up with Olga to discover the insider view on the trends and challenges of implementing FP&A facing so many CFOs.
Olga Corbett: In my mind, the first challenge to address is that unlike many other disciplines such as accounting, engineering, sales or customer service – the FP&A role in my experience is not as clearly defined and varies from traditional accounting to advanced data analytics and business consulting. The scope and sophistication of the FP&A role certainly is a function of the size and complexity of a business. How a most relevant and effective FP&A model is recognized and implemented, is in my mind directly related to a CFO or finance leader’s own experience, their ability and commitment to define the role of the FP&A group within their organization, as well as a willingness to go against a long-standing structure or territorial claims on certain aspects of the role.
FP&A demands organizational time and resources and returns a negative ROI, which I think is putting smaller companies off implementation. And, this is probably relevant for larger companies as well. It is still more traditional to view finance as rather technical accounting, AP/AR, or taxes. This again is about the recognition of what FP&A can deliver incrementally besides duplicating traditional accounting functions. To get our business partners to adopt and recognize what we incrementally produce is no less than demonstrating that we equally or sometimes more deeply understand and can impact the business, customer/supplier dynamics, technology and any other factors driving the business. With the continued advances of data analytics and deep learning, I believe FP&A is perfectly positioned to become a liaison between business operations and technical data science to help make sense of short-term and long-term aspects of business management. Budgeting, forecasting or long- range plan process must transform to take advantage of the incredible data environment today. The growing problem of having too much data, too many metrics sometimes conflicting with each other, understanding how to leverage this wealth of information intelligently is where FP&A can clearly demonstrate its role for the business partners and data scientists.
To continue reading Olga Corbett's insider view on the FP&A sector, download our free ebook: CFO Guide to FP&A Trends in 2019