Top 6 Focus Areas for Strategic FP&A Teams

It doesn’t matter the size of your FP&A team, or how high you’d rate your strategic finance abilities. As a finance leader, you need practical ways to improve. If your overall goal is to “become a more strategic finance team,” here are six main areas where FP&A teams get real traction when they shift their focus and take the next step.

1. Organize your data for strategic financial planning

You need a clear snapshot of the present to accurately forecast the future. It sounds basic, but finance teams of all sizes still struggle with data visibility and accuracy.

Duplicate data entries, missing information, and inconsistent formats will hurt your analysis and yield unhelpful reports. You need a baseline of clean, accessible data before moving on to the next steps of deeper analysis and visualization. If this is a challenge for your finance team, you can support your CIO to refine a data strategy to provide the flow of ‘clean’ data you need. 

To level up, find your next step to improve business data: 

• Integrate ERP, HRIS, (and eventually CRM) data into an FP&A software solution to ensure that your team has real-time access to all important business data – no more .csv and spreadsheet headaches. 
• Choose a tool with analytics features to spot trends or anomalies in your data. 
• If you already have these capabilities, explore advanced analytics tools like AI-powered predictive modeling and data visualization to prepare for future scenarios. 

With real-time, well-organized data integrated into an FP&A platform, your CTO or Head of Product can directly access reports and monitor their department’s spending against the plan. This gives your strategic finance team more time and energy to shape business decisions instead of cleaning up data or building forecasts with inaccurate numbers.

Learn More: What is Master Data Management? (And Why is it So Hard for FP&A?)

2. Champion collaboration as a strategic finance business partner

“50% of CFOs see C-suite collaboration and establishing finance as a business partner across the enterprise as a top priority.” (PwC)

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If only that number were 100%! At any size and stage, business partnership is a key way to increase the strategic value of your finance function. Try these ideas: 

• Support your finance team to implement stakeholder engagement plans to guide their communication and interactions with each business leader based on their level of investment and priorities. 
• Offer professional development opportunities to your analysts. Help them step out of their comfort zones and leverage every stakeholder interaction to learn more about the business to improve budgeting, forecasting, and resource allocation.

Introduce workflows for collaborative budgeting to get more efficient in your process. Make it easy and secure for budget owners to proactively participate in planning, all while Finance remains in complete control of the process.

3. Focus on risk management

Your FP&A team needs to balance business growth with financial sustainability in every decision. Look to your risk management practices for small ways to add big strategic value in uncertain economic times. 

• Be sure your FP&A tool supports scenario planning so you’re prepared with options and your response, no matter how quickly the economic forecast changes. 
• Get more acquainted with operational drivers for your business, across every department. Take these insights and find practical ways to increase cash flow, like optimizing, exploring new revenue models, and cutting indirect costs. 

Choose security-first FP&A software with industry-compliant controls, encryption, and customizable access levels.

4. Increase financial reporting frequency

A lengthy analysis and reporting cycle will slow down strategic decisions in your organization. All FP&A teams can benefit from faster times to analyze data and report to stakeholders. To grow as a strategic finance team, find ways to increase your reporting and forecasting speed. 

• Identify and measure your KPIs for financial performance and create live dashboards for stakeholders to monitor in real time. 
• Find the ideal rhythm of reporting and forecasting for your business. Automations within an FP&A tool can generate budget variance reports and create your month-end reporting package in minutes, not weeks. 
• Be sure your reports are readable and tell the compelling story behind the numbers. 

5. Build business agility

A stronger strategic finance team will position the business for long-term success. When time is of the essence, the ability to produce a new forecast or provide historical data can enable or hinder strategic action. Achieving simple scenario planning should be a top priority for your finance team. Many teams are working with a time-consuming or non-existent process of scenario planning, often driven by a reliance on spreadsheet modeling (see image below). Planning for any outcome and comparing versions without breaking your financial models is an essential component of business agility.

• If delays have been a struggle for your finance team, get laser-focused on producing your annual budget on time. 
• Empower stakeholders with self-service access to the financial plans. They can check their spending against the plan and make wiser decisions with finance as the facilitator, not a bottleneck.
• Search for ways to automate your FP&A processes as much as possible. Monthly reporting packages, headcount reconciliation, BvA analysis are all examples of reporting that can be automated. You’ll have more time to respond to market forces or make changes to your plan at a moment’s notice.

6. Integrate modern FP&A software

Finance teams at any stage need a defined technology plan to meet the demands of strategic finance. This starts with a needs assessment and understanding of your current tech stack to see how FP&A software would fit. Spreadsheets are still a go-to for most FP&A teams, but you should take a close look at the sophisticated cloud solutions that offer the flexibility of spreadsheets without the common frustrations. 3rd gen FP&A software options are user-friendly with a driver-based approach to planning, no expensive consultants needed. 

For example, the right FP&A software can make a big difference to your workforce planning process – a huge portion of business expenses. Organizational success depends on getting it right. Technology improves the process with automations to help you reconcile new hires and terminated employees, add a planned position, or backfill positions in a few clicks. You can leverage detailed assumptions in your workforce plan for comp, benefit expense, employment tax, and more in an easy, plain-language interface. 

Learn more: The Top 5 Workforce Planning Tools for Strategic Finance 

When you find the ideal FP&A tool for your requirements, strategic value will skyrocket. You’ll have the data at your fingertips, modeling and forecasting in a fraction of the time, better stakeholder reports, and more time to get to know your business.

Small steps from basics to business impact 

As a finance leader, you have the responsibility and the opportunity to build a more strategic financial planning process. These practical steps to grow in data, collaboration, risk management, reporting, agility, and technology will add up to a substantial shift in how your finance team influences business strategy.  

Looking for more practical advice to improve your finance team and have greater business impact? Dig into the CFO’s Guide to Scaling Strategic Finance for a framework to assess your process and find your next steps.