AGILE PLANNING AND THE CHINESE CURSE

Accountagility Planning

“May you live in interesting times” is purported to be a traditional Chinese curse, but it certainly applies to the period we are living in. There is certainly no shortage of business volatility, both politically and commercially. Conflicting signals from the markets we operate in can be difficult to respond to in a co-ordinated and planned way.

Post-Brexit scenario planning

There can be few conflicts within the UK that match up to Brexit. On the morning after the Brexit result, Friday 24th June 2016, all financial services entities with a UK presence were faced with a new and unpredictable world.

Agile planning empowers these businesses to create and refine new scenarios that model foreign exchange rate fluctuations and other business impacts, in hours, rather than days or weeks. Clearly, these changing times will cause swings in demand for goods and services, both at micro and macro levels. Modelling and testing key demand drivers will expose risks and highlight new profitable pursuits, so that Finance can channel resources and investment towards maximum return.

Tactical vs Strategic Demands

How can the modern Finance function provide the much needed direction and strategic input into the business under such conditions? Well, for starters, their planning processes need to be agile and highly automated, a nirvana that is often talked about but which can be difficult to achieve in reality.

Especially given ever-increasing tactical demands on the Finance function, higher data volumes and the constant resource constraints, how can CFOs deliver both these short term deliverables alongside longer range strategic needs?

Technology, people and process

The answer within the Planning function falls within Technology, People and Processes. Technology is the enabler which provides the opportunity and tools to solve these challenges. Quick turnarounds require agile tooling that can rapidly adapt to new business requirements and conditions.

Your chosen planning environment must support rapid foreign exchange exposure analysis, multiple scenario creation and comparison, and should ideally have all the business logic in one place. Finally, our research shows that where your plan spans multiple geographies, different rules or logic might be needed to support the various regulatory requirements. This can be an important source of process challenges if it is not well catered for.

Of importance is that staff are empowered to own and change the planning business logic themselves – in our experience where this is not the case, the planning team performance and responsiveness is significantly impaired. The machinery, therefore, needs to interface well against the different planning users and target audiences.

Lastly, and the area that is most neglected is Process. Automation is an experience, so our processes must continue to reduce manual interventions, not to create new ones. This implies a feedback loop where new adjustments and interventions are formalised into the central planning business logic at the first available opportunity. Finance can no longer rely on “ad-hoc”, manual workings to get them through a planning season.

Given an automated and accurate plan, technology provides the platform for the CFO and their team to analyse results, formulate initiatives, and challenge the plan with different scenarios. At this point Finance become a true strategic partner to the business, a challenging but crucial role to any modern business.

If you have been following our Brexometer updates, which summarise the UK’s economic and political status into a single monthly score out of ten, you will have witnessed these “interesting times” unfolding dramatically.

The speed and magnitude of change is remorseless. The support of agile planning technology is becoming a vital defence against the quintessential Chinese curse.