We’re often told that agility is essential in today’s volatile business environment. But agility alone doesn’t guarantee success, because a quick, agile move in the wrong direction could steer a company straight into the ditch. Agility has to be guided by accurate information. That’s the message from the Aberdeen Group in a new Knowledge Brief, which is accompanied by a short analytics assessment.
In Accuracy Drives Agility in Financial Planning and Analysis, Aberdeen examines the difficulties that organizations face in achieving accuracy in their planning, budgeting, and forecasting. And they outline the solutions and best practices that leading firms are using to improve their accuracy.
The Knowledge Brief is based on the results of a recent survey of finance professionals. That survey found that finance teams who use modern enterprise performance management (EPM) solutions in conjunction with business intelligence (BI) were measurably more agile than their peers. These finance teams, identified as “Leaders” by Aberdeen, realized significant advantages in key metrics including:
- Operating margins
EPM and BI deliver accuracy
The brief explains that “The adoption of an EPM solution in conjunction with BI analytics significantly enhances organization-wide agile capabilities.” Why? Because EPM and BI together provide “an accurate view of performance data that enhances an employee’s ability to derive actionable insight and make better informed decisions.” They added that “companies that adopt both EPM and BI analytic solutions in tandem see marked improvement in their agile capabilities (those capabilities that enable quick and proactive responses to both external and internal changes).”
Here’s a particularly relevant graph from the report:
To gain the accuracy that drives that agility, Aberdeen recommends that organizations look for EPM and BI solutions that:
- Provide centralized visibility
- Empower employees to explore data
- Increase decision speed
Ease of use is critical
In addition, the brief said, “It is of paramount importance that EPM and BI solutions be easy to use, so that users do not have to constantly rely on IT to access and visualize the data.” In fact, when survey respondents were asked to identify the top criteria for selecting a solution, they “overwhelmingly indicated that a solution must have the right functionality and must be easy to use and support.”
Ease of use is critical, because no solution can deliver accuracy or agility if people don’t want to use it.
To learn more about the solutions and best practices that leading firms are adopting to achieve more accuracy and agility in their financial planning and analysis, read the Aberdeen Knowledge Brief. Then take the 7-question Aberdeen Group assessment, “Are you making the most of your planning analytics?” to gauge your own organization’s maturity in analytics for planning.
(Header image of acrobats in Shanghai by Qing Ju, used under a Creative Commons license.)