Model Partners: FP&A Helps the Business Plan Through Modeling

# FP&A

# Technology

In tough times, FP&A is transitioning to a forward-looking stance to support smart business choices.

Inflation, anemic growth, market volatility and belt-tightening are top of mind for FP&A leaders. In a recent survey of NeuGroup for Heads of FP&A , members revealed they are putting great emphasis on collaborating with the business.

Specifically, they are using modeling and scenario planning to help operational leadership make informed decisions on how to plan for a difficult environment by reducing costs and/or grabbing potential growth opportunities. As the chart below shows, 94% of respondents have either adopted these practices or plan to in the next 12-18 months.

Time to look forward. The combination of these data points tells an important story about the critical role FP&A plays in helping companies withstand economic instability while improving results through better decision support.

Scenario planning and modeling enables meaningful conversations with business partners seeking to eke out savings and make savvy investments in continued growth.

To this end, 75% of those surveyed plan to adopt advanced analytics solutions, and half are looking to implement machine learning tools.

With the help of these new technologies, FP&A teams will be able to offer better advice to their business partners. That trend is reflected in members’ plans to embrace a more forward-looking approach to planning and forecasting.

Sixty-seven percent of respondents expect to adopt predictive analytics this year; the same number also intends to transition to rolling forecasting.

The bottom line: The business challenges ahead are elevating the role of FP&A as a strategic advisor to the business. So this is an opportunity for FP&A teams to build credibility by producing actionable, forward-looking insight and leveraging new technologies to improve modeling and analytics.