Step-by-step guide to a successful implementation
Have you ever thought about how to move from Excel (or another datasheet) to a more modern and data-driven system? It might seem like a complicated process, but it’s actually quite simple. In this step by step guide to a successful implementation I list the most common reasons why companies don’t invest in a system, despite all the advantages. I will also highlight what companies might benefit from working with a system, common reasons to why companies don’t invest in a system and what to avoid when implementing a new planning solution.
Leaving Excel for a more modern system has never been easier
In our annual study, The State of Corporate Financial Planning 2022, it was shown that roughly a third of companies have invested in a budgeting and forecasting system. Most of the other companies still work with Excel models (or other data sheets) to administrate and handle their financial forecasting processes. This is something that often leads to several limitations. The study shows that companies who have invested in a system and work driver-based with their financial budget- and forecast processes experience a higher level of engagement and ownership in the organisation. These organisations also experience a better quality of their forecasts.
With this many obvious advantages – how come all companies are not investing in a modern system for budget and forecast?
Today we have close to 150 customers, and during the past couple of years, we have met and had discussions with more than 1000 middle-sized to large companies. From this experience we have seen that the 3 most common reasons to this question are:
1. The investment decision is perceived to be a lot bigger than it needs to be
Companies often assume they need a large IT project to implement a new financial planning system. This might have been true in the past, but with modern, cloud-based SaaS solutions, most companies that we meet can get started with a new solution in less than two months.
2. Organisations try to solve everything at the same time
Instead of trying to solve the most critical processes and problems, many companies tend to try to solve all problems at once. This is rarely a successful strategy, as it makes the implementation both slower and more expensive than necessary. A solution of this kind is also rarely appreciated by the rest of the organisation since the solution often is hard to get an overview of and therefore hard to understand.
3. There's too much to be done, and you don't have "time" to prioritise forward looking activities
The following classical image can conclude this way of thinking. So much of the time is put on budget and forecast work that there is not any time to challenge and develop the processes - and there is especially no time to systemise and automate these processes.
The companies that try to develop their processes and methods continuously are also the companies that perceive that they get the most value from their financial forecasting work. These companies don’t consider the financial planning a task that just needs to be done, and thus continuously work to automate big parts of the work, to enable more value adding and frequent work. This optimisation makes it possible to always have a qualitative and updated financial forecast that can be a more strategic decision-making tool.
So, how do you transfer your processes into a data-driven system?
If we focus on a data-driven system for financial planning, the answer can, of course, depend on your company. However, there are multiple common denominators:
1. Identify your primary goal
What is your goal? Do you want to reduce the time put into financial planning? Do you want to limit the headache and overtime necessary to administrate and put together a budget? Do you want to increase the frequency and quickly create new forecasts? Do you want to increase engagement and ownership in the business? Or is it a combination of all these factors? A clear goal is essential both to be able to identify the right supplier, but also to create the best chances for a successful project.
2. Focus on the problem
Try to focus on the real problem. Don’t let everyone leave their wish list; don’t hire external help to complete a pre-study. This will quickly become an expensive and utopic product that is hard to translate into reality. You're the ones who know your business the best. You have the best conditions to succeed if you do the necessary job. If you have identified the goal and taken ownership of the problem, you will quickly be able to search for a necessary selection of well-established systems.
3. Don't try to solve every issue at once
Financial management is not static; therefore, it will never be completed. The world and the conditions are changing more rapidly, and it’s consequently vital that you have the option to get started as soon as possible. After that, you can optimise the process and the system after how the world is changing. The modern cloud solutions can be changed on your own or for a small fee, which means that you’re getting a solution that can evolve together with you.
4. Reserve the time needed and start the work
To invest in a system that’s customised for your processes and your logic demands you to reserve time, but it’s not like in past times. Instead of continuing to use a push-and-pull method on a defect excel process, it’s much less painful to rip off the band-aid quickly. Setting aside a couple of hours a week for one or two months to start using your customised solution is often enough. If you put aside the needed time today, you’ll optimise and systemise your process and thus reduce the administrative time spent in the future. At the same time, and perhaps most importantly, you also optimise the value of your financial planning.
What’s in it for you?
What your company have to gain by investing in a system depends on your goals. For most companies investing in a modern system for data-driven work, the implementation will lead to the following:
- Reduced headache and overtime at the company
- Better conditions for working driver-based, which leads to better quality of the work
- The revenue, costs, P&L, and cash flow processes become more transparent within the business.
- An increased engagement and ownership over the company’s financial goals and forecasts
- Better conditions to work more frequently with the forecasts and therefore create a situation where you continuously have an overview of the financial forecast
- Moved focus from creating a forecast to driving discussion and change, optimising the business.
Many companies want to work data-driven, but far from all succeed. This is often because they are stuck in old patterns and make problems more extensive than they need. Most middle-sized companies can get started with working more effectively and data-driven with their financial planning in two months or less. Everything you need is to begin the process. And the earlier you begin, the more time you’ll get in the future.
Do you wish to talk to one of our experienced planning specialists and learn more about how to get a successful implementation going from Excel to a more data-driven system? Book a meeting or send me an email, and I’ll invite you to a discussion.