CPM: Growing Your Business with Budgeting & Forecasting
Strategy, accuracy and automation are essential features in Corporate Performance Management (CPM) software that can make a world of difference for an organisations budgeting process.
When it involves planning, organisations can ensure strategic alignment, maximum visibility and streamlined processes with the correct solutions.
Organisations can get the best value from modern planning software if it's user-friendly, safeguards against budgeting and forecasting mistakes and permits automatic assignments, workflows and approvals.
In this blog, we are going to explore the routine planning processes and therefore the benefits provided by using CPM software.
CPM and planning software can carry most of the burden of annual budgeting through automating the bottom-up budget method. CPM software can automate data integration, saving employees having to manually load data into Excel. Also, through workflows, budgets will be automatically submitted for approval, including notification to the acceptable users. These features are effective as an organisation grows and more executives get entangled within the budgeting cycle.
The right CPM solution will give additional budget contributors while maintaining control and oversight. Unlike methods that rely on manual input, modern CPM software allows for the simple continuation of a process, even with personnel changes.
Finally, advanced financial reporting and analysis capabilities will help improve overall budgeting accuracy.
The majority of sales planning is completed in Excel spreadsheets for Sales Forecasts and also the combination of CRM and Sales data makes it difficult to supply updated forecasts quickly. Having software which will quickly adapt to changes within the economy and may create multiple budgets and forecasting scenarios will ensure organisations are operating with dependable, accurate sales targets.
In addition to financial processes like budget and sales targets, CPM software can make a major impact on operational planning also. CPM software will allow organisations to include their strategies and goals into planning software, ensuring organisational alignment with immediate insight into the progress of budgeting processes. CPM software is important for growing organisations because it allows you to plan the workforce ahead of time and align it with budgeting goals and sales targets.
Why is forecasting good practice for organisations?
A forecast is sometimes a quicker process and involves fewer employees.
A forecast is entered at the overall ledger account level.
A budget may be a company’s intention for the approaching year, while a forecast is the latest expectation of what is going to happen over the remaining months of the year.
The budget is finalised before the beginning of the year while a forecast is created monthly or quarterly once the year has started and actual data is reviewed.
Many companies create multi-year forecasts while budgets are just for the approaching year.
While the budget is formed 1 to 2 months before the year starts, the bulk is formed up to 14 months prior, as an example, the budget is finalised in November for an organisation based on a calendar fiscal year. Meanwhile, plenty can change within the various aspects of an organisation concerning the economy, industry, products, competitors, employees and leadership. A forecast can more accurately influence decision-making.
Companies can impact their bottom line by forecasting regularly and forecasting monthly can affect decisions around:
Expense reduction and tightening up the authority to spend.
Employee raises, new hires and terminations.
Capital expenditures reductions or increases.
Strategic planning and modifying initiatives.
CPM solutions contain many features and capabilities from dashboards and reports that allow users to gain insight from the past, to planning and forecasting modules that enable them to determine the future. The additional benefits of accuracy, automation and other time and money-saving features will make such an investment very worthwhile.
Check out my previous blog identifying the features and capabilities to take into consideration when selecting a Corporate Performance Management solution.
Start taking advantage of our CPM solutions by contacting an experienced team member today for more information. In the meantime, check out how The Hermitage Medical Clinic transformed financial processes with Solver CPM - Client Success Story