Planning comes around every year... (Part 2/3): What you can expect from specialist planning solutions

While the first post in this blog series highlighted the typical problems that exist today in the area of planning, this post looks at how professional software solutions can efficiently support planning.

The use of specialist, supporting software solutions is a decisive factor in the sustainable success of efficient planning, budgeting and forecasting. They offer extensive functionality for the preparation, execution and follow-up of planning processes.

In contrast to Excel, specialist software solutions are based on a uniform database for actual and plan data as well as a consistent data model, which is filled with data from (operational) source systems via defined data integration processes. As a single point of truth, the central storage of all data creates a single, common data basis for planning and other business intelligence applications (e.g., reporting, analysis and consolidation). Based on this, a planning model that flexibly integrates all sub-plans should be developed. Its range can extend from strategic planning to operational sub-plans (e.g., sales, production, HR) to financial results planning. Flexible planning horizons offer the possibility to represent strategic, medium to long-term planning, as well as its transfer to annual budgeting. When updating plan data during the year (forecasting), it is necessary to compare it with the actual values realized. On this basis, forecasts of probable future developments can be made. For the modeling of company-specific planning models, specialist software solutions such as Unit4 FP&A offer a high degree of flexibility so that individual requirements can also be implemented.

Software functions have to efficiently support both top-down and bottom-up planning activities. Top-down approaches are often used for strategic planning as well as for financial results planning. Bottom-up approaches are used in geographically distributed environments, where it is usually a question of collecting plan data from different parts of the company with a large number of planners involved (e.g., sales or cost planning). Helpful functions for top-down planning include parameter and structure simulations with scenario comparisons, analyses and data distribution ("splashing"). Bottom-up planning, on the other hand, is supported by functions for process control including status monitoring (workflow) and convenient entry options for plan data using various clients (web, Excel, etc.) including data entry validation.

Since planning requirements can change quickly, departments often strive to increase flexibility in handling data and independence from central IT (self-service). For this reason, software tools must be easy to use and user-friendly, with little training required to achieve quick results. Furthermore, in order to be open to future requirements, a solution should offer flexible opportunities for adaptation, growth and development.

In the next post in this series, you can read about the benefits companies achieve by using specialist planning tools, especially in comparison to Excel-based planning.