COVID-19 The Black Swan
The response to the coronavirus (COVID-19) pandemic is evolving quickly, and at this time, we don't know how long the crisis will last. In the initial few weeks, our clients have concentrated on protecting employees, maintaining their supply chain, getting to grips with their cash flow, and rightly so. But as events continue to unfold, it is now more important than ever to have the financial systems and analytics capabilities needed to better predict and be ready for a rapidly changing landscape.
There's no doubt that the weeks and months ahead are going to be challenging and the priority now for business leaders is ensuring their company can ride out the impact. It is also time to look forward and be prepared for the New Normal. Finance teams around the world are already asking themselves if a spreadsheet-based process for planning, forecasting and modeling is the fast, agile and robust platform needed in the future.
Strategic Advantage is Designed
There will be a strategic advantage to businesses who can predict and allocate resources more effectively and with greater speed in the future. At the core of this advantage will be the critical role of the finance function and FP&A teams. To be ready to deliver this strategic advantage, FP&A teams will benefit from a strategic vision that realigns business processes and technology to provide capabilities that are:
- Agile -- nimble, dynamic, flexible
- Fast -- quick to change, high-performance
- Richer -- deeper data sets, more scenarios
- Smarter -- predictive, augmented modeling
Qubix has been helping clients to adopt our Extreme Finance Playbook for several years with proven success. The strategy roadmap details 15+ specific interventions finance leaders can implement to shape a world-class FP&A capability.
Extreme Finance FP&A Playbook Highlights
Organizational changes to define and maximize the FP&A role:
- Emphasize the role of FP&A as a business-change enabler and a team to enable future business performance.
- Report directly to the CFO or a key business leader, but not another finance function.
- Hire or teach strong analytical skills, including those needed for statistical analysis.
Focus on technology and critical systems skills:
- FP&A leaders combine data and smarter finance tools to deploy predictive and prescriptive analytics.
- Create a systems strategy focused on increased automation, self-service analytics and intelligent processes.
- Apply new best-practices like rolling forecasts, scenario planning, and predictive analytics. This shows that planning is moving from an annual event to a continuous process.
Become partners to the business, which includes:
- Understand the front-line challenges of business operations by spending time with them.
- Develop the core soft skills needed to create trust and partnerships across the business.
In the New Normal technology will widen the gap between those who survive from those who go on to thrive. Finance leader can play a critical role in ensuring the organization thrives. Our call to action for CFOs and finance leaders is to explore the specific "Extreme Finance" transformation initiatives we have recommended.
We have created a revised version of our recommendation roadmap to set out a plan for how FP&A teams can prepare for the New Normal with a focus on how process and technology is now the most critical strategic priority to be ready for what is next.
Download the paper here: Qubix Extreme Finance Playbook for the New Normal
Listen to Podcast with David Dickerson of Diversey: Finance Leadership Series - Managing finance in Unpredictable times.