Budgeting is an essential function within FP&A (Financial Planning and Analysis) teams, but let’s face it: the annual process can be a source of headaches and frustration. From wrangling spreadsheets to dealing with changing priorities to appeasing difficult participants, budgeting often presents unique challenges. In this blog post, we will take a lighthearted look at some common budgeting headaches faced by FP&A teams and explore creative solutions to overcome them. So, sit back, relax, and join us on this whimsical journey through the budgeting maze!
The Spreadsheets That Never End: Ah, the endless rows and columns of spreadsheets—multiplying with each passing day and additional functional or department tab! Tangled formulas, data entry errors, and hidden cells are enough to make anyone go cross-eyed. And those instructions – were they even written in English?! And how many versions ago?? Solution: Embrace budgeting software or specialized tools that offer streamlined interfaces and automate calculations, saving your eyesight and sanity!
The Maze of Mysteries of Missing Data: Are they really mysteries, or are they simply miseries? You’re ready to analyze the budget, only to discover missing or incomplete data that throws your entire process off track. The missing actuals from last October forward…. aren’t we in January?!? And local to reporting – are the conversion rates up to date? Why does the direct expense seem wildly off…? It’s like searching for a needle in a haystack. Solution: Implement a data collection system that provides clear guidelines, reminders, and automated notifications to ensure timely submission of all necessary information.
The Shifting Sands of Priorities: You finally finish the budget, and then, surprise! New priorities emerge, an acquisition is announced, an organizational realignment is proposed, and – presto! – the budget becomes obsolete overnight. You feel the final budget slipped through your hands, along with several valuable weekends you’ll never get back. It is a never-ending game of catch-up. Solution: Embrace an agile budgeting approach that allows for regular updates and flexible adjustments to accommodate changing business needs, so you can roll with the punches.
The Time Warp Conundrum: You spend hours crunching numbers or chasing down an errant driver, only to realize you have been sucked into a time warp, and it is already dark outside. Budgeting has its own space-time continuum that always seems distinctly separate from the one in which you booked a presentation the following day… Solution: Set strict time limits for budgeting tasks and establish a prioritization framework to focus on critical aspects first, ensuring you escape the time warp with minimal disruption.
The Rogue Director: We all know this person. The “leader” who refuses to follow the process, dreams up a plan based on outlandish assumptions, and angles to present it directly to the president without a proper vetting from Finance. Nothing like teamwork… Solution: Set up your framework in a cloud-based modeling platform – with a nice workflow dashboard your president can review!
The Approval Odyssey: You’ve navigated the spreadsheets and data mysteries, but now you are embarking on the perilous journey of gaining budget approvals. It’s a clandestine tug-of-war! Multiple rounds of revisions and endless approval chains can make you feel like you are trapped, lost in a never-ending maze! Solution: Foster clear communication channels, consolidate feedback efficiently, and establish well-defined approval workflows to keep the process moving smoothly.
The Balancing Act: Balancing budget constraints with the ambitious goals of various departments can be like walking a tightrope without a safety net. It requires diplomacy, negotiation skills, and a touch of magic. Solution: Foster open dialogue and collaboration with department heads, align goals and expectations early on, and seek win-win solutions that strike a balance between financial prudence and business needs.
The Phantom Expenses: Unforeseen expenses pop up out of nowhere, wreaking havoc on carefully crafted budgets. It is as if they materialize from another dimension (or more likely a disorganized department head). Solution: Implement contingency plans and budget reserves to accommodate unexpected expenses. Regularly review historical data and analyze trends to identify potential hidden costs and mitigate their impact.
The Reporting Marathon: After all the budgeting hoopla, there is the marathon of generating reports for stakeholders. Endless formatting, analysis, and data visualization can make your fingers ache and your mind spin. Solution: Embrace reporting tools that offer customizable templates, automated data visualization, and user-friendly interfaces to simplify the report creation process and impress stakeholders Conclusion: FP&A teams are the real heroes here, of course!! This is where you can really shine (with the right tools and proper support). While budgeting headaches are part of the FP&A journey, they do not have to drive you to the brink of madness, or into extended disability. By adopting creative solutions, leveraging technology, fostering collaboration, and maintaining a sense of humor, you will win the budgeting marathon!
With its thirty plus years of experience, Akili has worked with FP&A teams to ensure they stay ahead of the curve and remain competitive – despite the obstacles! As an implementation partner for Anaplan and Kinaxis, we will ensure a successful adoption and deployment of the cloud-based planning and modeling platform as fast as six to eight weeks and catapult you in the direction of your dreams. Book a demo today!
