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There are many ways that predictive analytics, in the form of business forecasting, can provide a competitive advantage but a key potential benefit of improved forecasting is collaboration.
Forecasting can help to improve business and financial processes and results. Vast amounts of data are used for corporate forecasting, which leads to a stronger collaboration between finance and business. Since forecasting fosters efficiency for operational people, it creates a competitive edge. In turn, people can share information that improves the accuracy of forecasting. This stream of information reaches the financial department, which can then be used as input for better forecasting, leading to a virtuous circle.
This means that collaboration is both a requirement for improved forecasting, and the result of it. When data is shared through collaboration, forecasting improves. Once forecasting improves, performance improves as well. This fuels the appetite of all actors involved to engage in further collaboration, to improve performance even further. However, “capitalizing on the benefits of that collaboration… requires a degree of communication between data professionals and business leaders.”
But what is the key to improving collaboration? Setting up more and longer meetings is probably not the solution in this regard. There are six solution capabilities that facilitate collaboration and involve more people in the planning and forecasting process. The combination of these capabilities leads to collaboration being embedded into actual work.
- High participation
Collaboration is fostered by high participation. If different people from across departments and geographical areas all buy in, this leads to enhanced collaboration. And this ultimately leads to insights to improve forecasting.
- Streamlined workflow and approval
If information can be entered easily and workflows can be monitored easily, the solution is streamlined and collaboration is facilitated. ‘Traffic lights’ are an example in which icons can identify plans that haven’t started yet, plans in progress or ready for review. This streamlines the process for reviewers and allows them to collaborate with participants to optimize the plans.
- Bridging the terminology gap between business and finance
The jargon of finance and functional areas are vastly different. A user wants to enter data in a certain terminology that they use every day and the forecasters needs this data translated into financial terminology. A possible bridge is a predefined formula that translates information into financial data.
- Interface options
Like it or not, spreadsheets, even with all their limitations as planning tools, are very popular for most business users. Therefore, the interface should resemble a spreadsheet interface in order for people to buy in to the system.
- Version control and audit trail
A built-in audit trail provides a record of changes from all people that have worked in the system. This gives a quick insight into who made which changes and for what reason. This built-in audit trail helps satisfy compliance requirements.
Communication should be relevant, in order to make collaboration effective. Administrators can set viewing options in such a way that business units and even individuals see tailored forecasts of only what they need to see. This efficient view, leads to effective cooperation.
Together we improve
What these six solution capabilities show us, is that the easier the solution, the more rapidly people will adopt it. And the more rapidly people adopt it, the more collaboration is fostered. Consequently, your forecasting is improved, which through the virtuous circle will improve collaboration. These are only six examples of collaboration solution capabilities, but there are many more to be applied.
To learn more about the value of collaboration in the context of advanced analytics, read “Forecasting as a Competitive Advantage: Optimizing Business Planning With Advanced Analytics.”
And to learn about a planning solution that makes forecasting and collaboration easier and more efficient, download the IBM Planning Analytics data sheet.