NEUBRAINER, the official blog of Neubrain

It is a common mistake to assume that automation alone will bring necessary budget process improvements to an organization. Automating an inefficient or unintelligent bud­get process just makes the same process faster, not better.

The reality is traditional practices that govern budgeting, planning, forecasting, reporting and  risk management are becoming obsolete in the context of a fast paced digital marketplace and a volatile and uncertain global economy. Long established budget practices provide a false sense of security and fail to cope with the speed and volatility of today’s markets.

Additionally, the traditional budgeting process is widely de­cried, both by FP&A personnel—who must reconcile the requests from business managers with the targets handed down from the C-suite—and the business line managers they support—who view the budget process as a bureau­cratic exercise, a distraction from their job, a drag on their time, and a purely finance-driven process.

As you consider a new budget system, remember this is the optimal time to evaluate the strategies that can help your organization develop a more agile and intelligent budget process, use this process as decision making tool rather than a negotiation, and positively change your orga­nization’s perception of budgeting.

The following are a few strategies and best practices to consider:

PIE CHART
- HOLIDAY EDITION -

Enterprise Performance Management (EPM) is an umbrella term used to describe the methodologies, metrics, processes, and systems that help enterprise companies monitor and manage their business’s performance.

Executives seeking deeper insights into business trends and potentially ambiguous opportunities utilize Performance Management. Sub-components of EPM include: Enterprise Planning, Performance Monitoring & Measurement, and Enterprise-Wide Reporting. 

Benefits definitely outweigh the challenges in deploying an EPM capability. These benefits include:

• Enterprise-wide visibility
• Strategic “red-zone” monitoring
• Improved resource planning and allocation
• Agile decision-making
• Predictions for future performance
• Delivery of a broad spectrum of critical business data (Note: this data is generated through monitoring, analyzing, and controlling organizational performance.)

Failing to properly manage or dedicate your company to continuous improvement of your performance management capability can lead to undesirable outcomes. Organizations must be aware of common ways that performance management initiatives can be undermined, causing business performance to stall or decline, instead of thrive.

Here are 10 ways you could be undermining performance management and suggestions on ways to avoid these pitfalls:

While most modern budgeting software solutions can eliminate the basic spreadsheet challenges associated with data capture and simple aggregation, they typically do not take the next step: enabling the organization to use its data to improve budget decisions and the linkages between budgets and outcomes.

Data visualization tools, like software dashboards, are becoming more popular and necessary to deal with exponential data growth. According to the industry research; however, dashboards have often failed or at best they delivered only a fraction of the insight that is needed to monitor the business. Why?