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Webinar Video: Best Practices in Budgeting & Planning

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Corporate Budgeting & Planning WebinarAdvances in technology are creating opportunities to realize the benefits of creating better alignment of budgeting and forecasting efforts with strategic initiatives and operating in a dynamic financial planning environment. What does it mean for a company to move from a static to a dynamic planning and forecasting environment? How are companies leveraging technology and redefining processes to offer the right data at the right time to the right people within their organizations? This webinar focuses on best practices being utilized by companies on the forefront of budgeting and planning, and includes a case study of how one company has reaped the benefits of transforming from a static to a dynamic forecasting and planning process.

This Corporate Budgeting & Planning Webinar video is from the Proformative webinar "Best Practices in Budgeting & Planning" held on October 25, 2012. The webinar features presentations from Jeff Gelderman, Director, Solution Consultants, Host Analytics and Monica Ross, Director of Strategic Projects, Parsons.


Corporate Budgeting & Planning Webinar


"We have a few learning objectives for today's event. The bottom line, just very quickly without reading these bullets, we want you to learn about current emerging technology and techniques in planning, budgeting, and forecasting so that you can bring some ideas back to your company and hopefully improve your budgeting and forecasting processes there.

That's really what we want you to get out of today's event. Go back a smarter and hopefully learn a couple of ironclad ideas that perhaps you can implement to make this process more productive and less painful at your company.

Kicking us off today, it's my pleasure to introduce Jeff Gelderman. Jeff is a Director of Solution Consultants at Host Analytics. Jeff brings 13 years of experience in the corporate performance management software space to Host Analytics. Serving in a number of different capacities, he's been a subject matter expert, managed partner platforms, and performed account management for FRX Software, Hyperion Solutions, Microsoft and, of course, Host Analytics.

Prior to beginning his career in CPM software, Jeff leveraged his CPA whilst working in public accounting and in finance for a global manufacturing company. Jeff, thanks so much for joining us today. It's our pleasure to have you and why don't you go ahead and lead us off?

Jeff:  Thanks very much, John, and thank you everyone for attending today. Just to elaborate a little on what John mentioned in terms of my background. I did start in public accounting, then ended up in a financial analyst/controller role in corporate finance for a global manufacturer based in Atlanta, Georgia where I live. Now, the world that I operated in at that point was an interesting one.  We had some significant tools at our disposal. We had SAP as an ERP system, multiple tools for things like consolidations, reporting, budgeting, analysis, etc.

What I found was that I operated in a world of Excel because I was having challenges leveraging some of the tools that were out there for me. Unfortunately, it's what led me out of the world of finance. I made it, as you see the graphic in front of you, probably only to the hunched over monkey role of evolution there that you see. I share this picture with you because my role at Host Analytics is a unique one.

In what I do in the software world over my career, I get the opportunity and I think it's a unique opportunity to talk to hundreds of companies in a year, certainly thousands over my career doing this. I get to talk with CFOs, VPs of SP&A, corporate controllers and the like and hear about what's going on in their world, and oftentimes getting to work with many of them to solve some of those problems.

This graphic you see in front of you is a pretty common theme from all those conversations. Everyone wants to move to the right here. More get out of that bean counter role, get out of the true accountant, "Let me add the numbers up," scorekeeper kind of role, and evolve into somebody who's actively participating in driving that business forward.

We'll talk a bit today about what I've seen over my career of things that can help in that regard as it relates to the budgeting, planning, forecasting pieces of that equation. One of the very, very common themes that exists, companies large and small all over the world, are spreadsheets. Everybody uses spreadsheets.

There's often a question of, "Why would I change? What's the advantage of it? So what? I can go from six months to four months for my plan." Or, "I can go from six weeks to four weeks to create that plan," whatever your case might be. I would suggest to you as we talk about this and as Monica talks about her personal experiences, you think about a couple of things. There are many out there that might drive you to make some changes, but those kinds of changes are going to help impact a lot of things that we'll talk about next.

A couple of key things to think about A) people and retention. When I moved into the world of finance, I didn't sign up to be a spreadsheet jockey. It's not what I learned about and had stars in my eyes in undergrad and grad school when I was sitting in accounting classes. It was a very different picture in my head that didn't really end up playing out in reality.

People in retention can really suffer because of having to live that world of the spreadsheet jockey that I was. It's what drove me out of the profession unfortunately. One of the great stories that I've experienced or heard recently was a customer of ours that I had the opportunity to chat with who had automated their process, and I was speaking to their VP of SP&A earlier in the year. I said, "Well, how's it going?" I hadn't talked to her since she implemented the tool, and she said, "You know what? This was the first Thanksgiving I've had that I was actually able to see my family and go out and shop."

She didn't talk about budgeting. She didn't talk about technology. She didn't talk of anything related to finance. It was a very personal impact for her because their budget books were due to the board the first week of December. Historically, she was working entirely through the Thanksgiving weekend. That change for her, it certainly made her life a little better and made her work life a whole lot better. There's an absolute cost there.

Then, the other thing I would suggest you consider is, are there are projects out there that you'd like to do, but you haven't been able to, or maybe projects that someone's asking you to do that you haven't been able to get to? If I could have in my prior life helped somebody understand the costs to repair one of the elements that my business unit was responsible for, I wouldn't have just been a business partner as you see in the far right of this picture. I would've been a hero.

For this conversation, what we'll do is focus in on nine things that I've heard over and over and over, with all the companies I've had the opportunity to talk with that have led them to better budgeting and planning. Ultimately really, what that gets back to is better decision making. We'll build these up from the ground up, not necessarily in order, but some of them are a bit foundational.

The very first one, as you can see there, is systemizing the budgeting process. Ultimately, manual just does not cut it. It takes way too long, way too much opportunity for error. Personal story along those lines, my sister-in-law recently was going to build some shelves for her closet. Rather than going and buying some shelves or some other means to that end, she actually had some pieces of wood that she manually cut with a handsaw for these boards, for the shelf.

Editor's Note: Proformative offers a vast library of recorded webinars, not to mention an ongoing series of live webinars. Our video library includes; Customer Stratification Webinar, Spreadsheets vs ERP Webinar, Financial Close Best Practices Webinar, Host Analytics Webinar and Successful Resume Writing Webinar for your enjoyment.

The fact that my brother-in-law wasn't helping her was beside the point, but it was like a badge of honor for her once she started that she knew it was going to take her three hours to cut these boards. As she began, it was kind of this thing where she just felt like she had to do it. She had to finish it. She had to see it through. If she'd used a table saw that would've taken her five minutes.

There's really no reason to spend three hours cutting boards these days for something like that. Either use some automation or go buy some automation. Have someone already cut those boards for you. Kind of an out in left field example, but kind of to me speaks to this manual approach to things.

Maybe a bit more relevant example, I saw a study out of the Department of Defense recently, where they were looking at the error rate in recording data. What they did is they looked at using bar coding versus manually recording data through data entry. In bar coding the error rate was one in every 3 million records. I like those odds.

In a manual environment where people were physically keying or punching these things in, the error rate was one in 300. That's a factor of 10,000 in terms of the improvement moving from a manual to an automated world. As I start thinking about pushing my numbers out to Wall Street or making decisions about where I'm investing my money, I'd much rather have that one in 3 million odds of messing up than the one in 300 odds of messing up.

Now, as it relates to systemizing the budgeting process, it's interesting as I talk to various companies of all sizes, shapes, industries, etc., specific plans from company to company are different. Company A that does one thing is going to have some things in their plan that are very different from Company B that is in the exact same industry and same size.

However, regardless of those little nuances, the process of planning really is fairly consistent from company to company to company across industries. There are just little nuances, terminology and different models that you might use to accomplish different things is my take on things based on all the conversations and companies I've dealt with.

My point here is that there are systems that have been specifically designed for the business planning process, so if you are going to go out and automate this process, don't reinvent the wheel. Use one of those systems. There are many of them out there that are purely focused on budgeting, planning, reporting, consolidation, etc. Leverage the work that's already been done, don't reinvent that wheel.

Ultimately, what we're talking about here when we systemize this, is getting out of the minutia. I didn't go and get two degrees, sit through the CPA exam to become that Excel gymnast that I became. I could have done that with some online help and Microsoft Excel a whole lot quicker, a whole lot cheaper for sure. When I start to add that automation, many, many things all of a sudden start to domino in terms of the positive effects there. Getting out of the minutia being that first one that tips over in terms of those dominoes.

Let's keep moving on here, let's talk about the second element, which would be the concept of rolling forecasts so I think my..."

End partial; Corporate Budgeting & Planning Webinar

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