Amidst changing business models and unstable market conditions, global companies are adopting disruptive digital technologies to transform their financial planning & analysis (FP&A) functions. To leverage the true potential of FP&A, Chief Financial Officers (CFOs) require multifaceted, long-term plans that provide them with actionable data-driven insights, that support everything from business decisions to new growth strategies.

Even though FP&A teams spend more time on their work processes (than they probably did a decade ago), they still find themselves lagging behind. The rising frequency and intensity of economic volatility – in the form of supply chain disruptions, unpredictable market demand, labor shortages, and more recently, the COVID-19 pandemic – complicate the management of quarterly, semi-annual, and annual reporting cycles. Such trends make it more challenging to address real-time financial planning issues.

In addition, FP&A professionals must handle ever-increasing loads of data that need significant consolidation and reconciliation before it becomes useful for budgets, forecasting, and growth plans.

Use of legacy systems in small organizations: Resistance to change

In most surveys regarding the use of technology in FP&A, senior financial leaders unanimously agree that investing in new technologies is critical because they are strong enablers of value generation.

On the other hand, the actual work models present a different picture. For example, 58% of large and midsize companies still utilize spreadsheets to manage their budgeting processes, even though 41% of Excel users state that spreadsheets are not equipped to handle their data volumes. In managing financial data, businesses without a centralized platform spend 20% of their total planning and analysis time on data collection, and 30% on validating this information. Such numbers imply that legacy systems do bring significant overheads in terms of time, costs, and effort. Relying on spreadsheets also results in data and planning siloes, delayed transmission of critical information, and poor collaboration – these, in turn, affect strategic corporate decisions.

While almost everyone in finance and accounting teams – from CFOs to entry-level executives – acknowledges the benefits of rebooting FP&A with digital transformation, it is primarily the fear of technology taking over people that delays or impedes the actual adoption of new processes. Professionals with relatively lower job grades or salary bands consider companies like Uber that took over the commuting business leaving traditional cab drivers with fewer customers. They feel that digitization will make their jobs redundant.

Combining technology with the talent to improve FP&A operations

As companies adopt new technologies to improve product quality, marketing, customer experience, and other areas of business, they cannot afford to stay behind in their FP&A domain. They also need innovative methodologies to manage high-volume heterogeneous data, pandemic issues, and uncertain economic and geopolitical environments. The idea must be to use these challenges as a catalyst to improve their work processes and make FP&A more valuable for business strategy development. This is where both disruptive technologies and human skills help

Organizations capitalizing upon cloud computing, automation, big data analytics, artificial intelligence (AI), and machine learning (ML), predictive forecasting, and scenario modeling can use these technologies to obtain real-time insights related to profits, risks, performance, and enhanced shareholder value.

Such tools and systems enable them to shift gears smoothly, anticipate, and incorporate trends that matter, tailor strategic plans to new realities, and put working capital and cash flows at the center of their continuity plan. They allow users to take a reactive rather than proactive stance. 

For example, migrating data from siloed ERP systems and spreadsheets to the cloud improves data accessibility, standardization, and management. This is important because misaligned information on key performance indicators (KPIs) leads to flawed reporting for stakeholders. Data standardization also mitigates compliance risks.

In terms of robotic process automation, by automating their key data collection and validation processes, organizations can maximize team effectiveness by giving more time to focus on analysis-oriented instead of repetitive data entry tasks. Technology-driven FP&A solutions also enable FP&A analysts to perform what-if scenario analysis to uncover deep insights.

FP&A teams can also integrate AI, ML, and visualization technologies to build an advanced analytics platform that empowers them to share relevant information with CFOs and make connected, data-driven decisions. Analytics begins with data and using predictive modeling, statistics, and visualization turns the same data into insights.


It is evident that decisions involving finance rely on data and not intuition. And data travels from ‘sources’ to ‘uses’ via a process of collection, filtration, processing, and interpretation. Here, technology and human expertise play a key role. 

What FP&A professionals need to understand is: 

Disruptive Technology + Human > Technology alone  

Financial digital transformation helps FP&A professionals to combine facts and figures and drive them coherently to business leaders who in turn can leverage them to make the next move in the industry.  

What are your thoughts on the idea? 

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