Somewhere in ancient history, Heraclitus once said that change is the only constant in life. Now, more than ever, this statement holds true. In today’s increasingly complex world, where disruptive technologies and changing customer demands are requiring organizations to adapt to survive, it seems that the only constant is change. The biggest challenge organizations face is to respond quickly and effectively to this change.

Companies today are increasingly focusing on addressing erratic financial performance, by focusing on improving their planning performance. While the business environment has become more complex and both internal and external pressures have increased, the reality is that historical planning processes have failed to improve performance.

Business leaders strive for the right balance between risk, innovation, customer fulfillment and cost management. Increasing importance is placed on the ability to accurately plan and control future financial performance. Robust financial planning, however, is being hampered by several challenges:

  • Unclear vision: An unclear vision is a common cause of stakeholder misalignment. A company’s vision needs to be understood and supported organization-wide for business planning to be effective.
  • Lack of insight: Often, budgets and forecasts lack insight into and access to information that supports and drives financial performance. They are frequently based on inconsistent assumptions or financial targets.
  • Disconnected systems and siloed processes: Traditional planning, budgeting and forecasting suffer from a limited link between the strategic plan and the budgets and forecasts, leading to disconnected systems within the organization. Instead of working towards a common goal, different departments will be focused on their own set of KPIs.
  • Legacy technology: The extensive use of spreadsheets and outdated tools undermine, rather than support the planning process.


We all know that companies that plan well and accurately predict financial performance have substantially higher returns on equity. However, many companies struggle to overcome these deficiencies in financial planning and lack an integrated approach, which is required to deliver results. 

An effective response: Integrated Business Planning

  “I recognize these challenges, but how do we tackle them?”

Businesses can combat these pressures by aligning strategic planning, finance, supply chain, sales, marketing and product development into a unified and flexible operating model. This Integrated Business Planning (IBP) approach is designed to make proactive business tradeoffs while improving decision-making.

IBP enables companies to view their business with a holistic lens, focused on common business plans, actions, and outcomes. By integrating demand and supply planning with intelligent financial forecasts and dynamic scenario planning, the organization will be better placed to achieve its financial targets and outpace its competition. Integrated planning processes harmonize operational processes with supply and customer demand. Previously disconnected and siloed planning processes are tightly integrated to enable cross-functional alignment across the enterprise. 

Additionally, this integrated approach involves meetings and enriched dialogue between strategy, finance, workforce, capital and operational groups, but also provides structure, reporting and accountability behind the process. It translates to continually addressing strategy and design deficiencies as part of the normal business cycle to help produce solid business performance in good times as well as bad.

Figure 1: Integrated Business Planning Framework

Figure 1: Integrated Business Planning Framework

Technology as an enabler

“So, how can I build this in my Excel spreadsheets?”

There is only one short answer to this question: Excel doesn’t cut it anymore. Spreadsheets and legacy technology need to make room for an Enterprise Performance Management (EPM) software platform that enables planning processes to be integrated across every department, creating transparency around both the planning process and business performance. Using such a platform will enhance collaboration across business units and drive accountability over results.

The coming years will be marked by investments made by EPM software vendors in more advanced technologies, leveraging the capabilities of machine learning and artificial intelligence (AI). The focus has already started to shift from operational efficiency to enhanced data and insights, which can deliver a quantum leap in performance. Especially in the field of predictive analytics, we already see successful organizations using this technology to recognize trends and patterns in historical data and build on this to forecast future performance. There is a clear change in mindset here, moving away from asking questions about what happened, towards what will probably happen and what actions should be taken?

Amid the current wave of technology-driven disruption, the finance function needs to establish itself as a critical resource. Not only in its role as a business partner facilitating the planning, budgeting and forecasting, and reporting and analytics cycles, but also as a driver of change.

The benefits of technology-enabled IBP

“This all sounds promising, but what are the advantages I can count on?”

After successfully implementing a technology-enabled business planning approach, companies can expect many benefits from their investments, including:

  1. By setting strategic goals focused on business performance and defining accurate value drivers, strategy, operations and finance are incentivized to collaborate.
  2. Greater planning accuracy and operational performance is achieved by aligning strategic planning, finance, supply chain, sales, marketing, and product development functions while creating ownership and accountability.
  3. Value drivers are refreshed automatically when the actuals are updated and predictive analytics can pre-populate budgets and forecasts based on historical trends and patterns, shortening the planning cycle times.
  4. Driver based IBP provides better insights using strategic scenarios. ‘What if’ simulations are better understood to make decisions, creating agility to market conditions.
  5. Ultimately, better decision-making drives enhanced revenue, reduced operating expenses and improved shareholder value.


The potential benefits of technology-enabled, Integrated Business Planning show opportunities for finance to be a true business partner and driver of change in the cross-departmental decision-making process.

Organizations wishing to explore the capabilities and value of Integrated Business Planning should think big, start small, and build momentum.

Start by assessing the current state of your business planning process using a fact-based approach, then develop a future-state vision, with targets and guiding principles; identify the key gaps and create a roadmap; before starting the execution of your transformation journey.

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