Choosing the Best Extended Financial Planning and Analysis Solution

Adopting extended financial planning and analysis (xFP&A) software is a popular solution for the often-burdensome task of monitoring business performance metrics, reporting out, and taking actionable steps. However, not all xFP&A solutions are created equal. 

Budgeting, planning, and forecasting is a historically arduous and time-consuming set of tasks. Cloud-based applications and dedicated software programs have made these processes far less labor intensive, although it can be unnecessarily difficult time-consuming to share data across the smattering of disconnected apps and spreadsheets required to complete each function. 

“The majority of organizations are stuck with a multitude of tools to manage their planning, reporting, and analysis,” said Nils Rasmussen, CEO of Solver, who has led the organization for almost 30 years. “The result is many versions of the truth.” By consolidating data from multiple sources, leaders can work from a single source of truth.

According to the Corporate Finance Institute, xP&A—a variation on xFP&A—is fueled by data from across the company that helps the business align with operational goals and improve financial planning. xFP&A drives better and more agile business outcomes by aligning inputs from the organization and the macroenvironment into a single process or solution.

Benefits of xFP&A

xFP&A software is a one-stop suite that provides CFOs, financial departments, and stakeholders greater visibility into their company performance, leading to better management and control of operations, revenue, capital investment, and expenses.

Avoiding dated reports is key. In fact, Oracle reports that real-time analytics lets companies detect operational or market blips at the moment and accurately anticipate the next events, allowing them to design smarter, more personalized products and services, and even automate processes to make the business more efficient and less expensive to run. 

Not all xFP&A solutions are as comprehensive, flexible, or helpful as your business might need. There are several factors you should consider as you evaluate different xFP&A solutions to assess the best fit.

5 Key Factors for Considering in a xFP&A Solution

1. Scalability and flexibility - A system’s ability to handle increased loads and adapt to changing requirements without significant performance degradation or major modifications.
2. Integration capabilities - A system’s capacity to seamlessly connect and interact with other systems, applications, or services. 
3. Cost and ROI - Evaluating the total expenses associated with implementing a solution (cost), and the financial benefits gained from it over time (ROI).
4. User-friendliness - Is the solution an intuitive system or application users can easily learn and operate effectively?
5. Support and training - Vendor or provider assistance and the educational resources for users to effectively use a system.

Before shopping for an xFP&A solution, understand what your business is already spending across all departments for budgeting and reporting. If possible, estimate the cost of employee time spent switching between software solutions, integrating them into your systems, manually re-entering data, chasing down missing information, and of course, employee implementation.

5 Tips to Kickstart the Search for the Right xFP&A Solution

1. Share details with xFP&A software vendors.
2. Ask for a demo tailored to your business.
3. Ensure you can set relevant targets.
4. Seek feedback from internal stakeholders.
5. Make sure your business can use it. 

An xFP&A solution can streamline this process by providing financial officers and business leaders with greater bandwidth to see the bigger picture. It sets their company up for future success through more effective management and control of operations, revenue, capital investment, and expenses.

Your organization deserves to streamline your budgeting and finance planning & analysis. The process can be much more agile than you can accomplish with a traditional FP&A. 

For further details on how to select the best extended financial planning and analysis solution, download the Solver whitepaper.