Unifying Financial Communications
The ability to communicate and collaborate across departments and throughout business divisions is in many ways inherent to the process of financial planning, budgeting, and forecasting. Indeed, collaboration is perhaps more important to finance than any other function of a business (except for possibly sales).
Quite simply, members of finance teams and executive leadership can’t be expected to have direct insight into all the daily happenings and details, across every department and business division that can impact financial planning and budgeting. A lack of or inefficient communications, in turn, can leave key stakeholders and pertinent information out of the planning process, therefore impacting accuracy and accountability.
It’s largely why the business software and technology used by financial departments often includes collaborative capabilities such as workflows, dashboards, enterprise resource planning, and centralized portals. Even so, in today’s corporate environment, where employees are mobilized, desktops are virtual, devices and applications often are introduced by users and business needs change at the pace of technology, the financial forecasting and budgeting process also requires advanced internal and external communications capabilities. Without them, employees are unable to effectively connect and collaborate. According to surveys of North American businesses by Aberdeen Group, top performing companies are significantly more likely to enable collaboration during the financial planning process from the top-down and bottom-up, as well as across departments, argues Nick Castellina, research director for Aberdeen.
Consider, for example, the top pressures associated with the financial planning, budgeting, and forecasting process. Respondents cited a long and resource-intensive process (32%), market volatility and the need to dynamically account for change (31%), and poor communications and coordination across departments (28%) – all among the top four pressures. Unified communications tools that efficiently manage messaging and presence, support ad-hoc conferencing and recording, and seamlessly integrate across desktop and mobile devices directly address these and other challenges.
So it’s not surprising to find out that the businesses who consistently delivered financial reports on time and with the most accurate cost and revenue forecasting are nearly twice as likely as other firms in the Aberdeen survey to have established enterprise-wide collaboration. And since stakeholders that have input or impact on financial planning also can sit outside of an organization (such as suppliers that control delivery dates, resellers that determine sales, or customers that affect revenue), best-in-class companies are three times as likely as all others to communicate information with outside partners, and are 2.4 times more likely to employ emerging social collaboration technologies.
In turn, collaborative companies, compared to those that do not facilitate collaboration, see a significantly higher percentage of reports delivered to managers in the time required, a steeper decrease in time-to-decision over prior years, higher improvement in the accuracy of forecasting to actual cost and revenue, and a higher increase in productivity, show Aberdeen’s figures.
Perhaps best of all, organizations that collaborate in the financial planning, budgeting and forecasting process experienced revenue growth over the past 24 months equal to twice that of non-collaborative organizations.