FP&A software – swapping spreadsheets for SaaS

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• FP&A software lets businesses plan for future growth.
• While spreadsheets have their place – and their time – FP&A software allows you to extract more value from your data.
• Generative AI is making its presence felt in FP&A software, bringing new capabilities.

If you are buried in spreadsheets, and the thought of running another quarterly forecast in Excel is making you wince, it could be time to consider financial planning and analysis (FP&A) software. It’s the 21st century, after all.

There’s plenty to celebrate about spreadsheets. Tools such as VisiCalc and Lotus 1-2-3 brought accounting entries made on large sheets of paper into the digital age. Electronic spreadsheets were one of the reasons why many businesses invested in personal computers and opened the door to ‘what if’ scenario planning.

But a lot has happened between then and now, including the growth of FP&A software – dedicated tools that overcome the issues that firms face when trying to chart future growth using Excel or Google Sheets.

Spreadsheet problems

It doesn’t take long to discover the pitfalls of using spreadsheets for business planning. “Excel is not a process-based tool,” Nelson Petracek – chief technology and product officer of Board International, a global provider of intelligent planning solutions – told TechHQ. “At a certain point, firms look for something better.”

A big disadvantage of using software such as Excel or Google Sheets is that information can quickly become siloed and teams can become isolated in their thinking. Multiple spreadsheets can be in use at the same time, and that creates another problem.

If you’ve ever asked a colleague whether they have the most recent version of a spreadsheet, you’ll be aware of the perils of trying to manage version control manually. On top of that, companies put themselves at risk if sensitive business information is left unprotected.

General spreadsheet applications are not necessarily built with security front and center, and the business risks of using spreadsheets include unauthorized access, suffering a data breach, or losing data if standalone files are deleted by mistake and not backed up.

Last week, a portion of our @BlumbergCapital team met to strategize around fintech.

The most interesting subsectors we identified were:

– insurtech
– fp&a software
– b2b lending
– crypto
– regtech

What’s missing?

— Greg (@gregbrainard) January 30, 2023

It’s no accident that growth in FP&A software has coincided with companies generating more information than ever before. And solutions help not just in remedying the shortcomings of spreadsheets, but also combine other tools for visualization and data management into a single holistic platform.

Difference between business intelligence and FP&A software

Unlike business intelligence solutions – which answer questions such as “What can this data tell me?” – FP&A tools are designed fundamentally to help organizations address planning challenges.

“Companies are trying to expand and want to know what product goes where to meet demand,” said Petracek, referring to an everyday use case for Board’s intelligent planning solution.

Depending on their operating sector, firms may want to map that growth to e-commerce targets and run different scenarios to optimize pricing. Systems can incorporate various influencing factors, such as calendar events, weather forecasts, and many other business-relevant data sources.

List of FP&A software providers –

• Abacum
• Board
• Cube
• Finmark
• Kepion
• Planful
• Pry
• Syntellis
• Telemetry
• Vena
• Workday Adaptive Planning

To get started with FP&A software, users will typically focus on an initial use case, and go through an onboarding process with their provider. Petracek noted that there are often two types of response as users see the solution spring to life.

At the executive level, business leaders appreciate the amount of visibility that FP&A software gives them. Board’s solution includes a ‘Digital Boardroom’ with a built-in briefing book that includes geo, sales, EBITA overviews, and country details.

Annual or quarterly reports can be created within the platform as well as exported as so-called ‘live reporting books’ in MS Word and PowerPoint. What’s more, because those assets are integrated into the intelligent planning solution, charts and in-text references update in tandem with any changes or updates made within the main platform.

Having a single source of truth avoids any confusion between old and new data and means that users can make decisions based on a complete real-time view of business performance.

For staff who’ve been grappling to manually update spreadsheets and paste that information into reports, document automation is a huge time-saver and allows them to perform more value-added tasks.

Plus, as in almost every other enterprise software application available today, the benefits of generative AI and large language models hasn’t escaped business planning tools. The feature lets users have a conversation with their data and quiz the information using natural language, rather than having to learn any specialist commands.

It’s possible to assign access right down to the level of individual cells within the platform, and security around the system – in terms of who can do what – is fully controlled by the customer.

“The cloud environments are completely separate,” said Petracek. “Each customer has their own box.”

Board’s secret sauce includes a proprietary memory technology that it dubs Hybrid Bitwise Memory Pattern (HBMP), which – according to the firm – enables ten times faster query execution.

As you would expect, Petracek was reluctant to go into too much detail, but he did reveal that the FP&A software can slice and dice data in different ways so that calculations are available in an instant. Also, the HBMP technology allows Board to scale its solution to match growing data demands.

In terms of deployments, finance teams are often some of the first experience what the software can do. However, as word spreads, organizations will scale up their activity and apply FP&A software across multiple domains – such as manufacturing and other business areas, to address different scenarios.

Having FP&A software is a boost in terms of making it easier for different business units to collaborate. And there are regulatory wins too, as firms can demonstrate that they are on top of their business information and have data to support their claims.

From a usability perspective, web-native FP&A software can be viewed on any device, from a laptop to a smartphone. “People want to consume information in different ways,” Petracek pointed out.

Today, there are thousands of companies that have made the leap from using spreadsheets to dedicated business planning tools. In the case of Board, customers include some very big names such as Coca-Cola, Puma, L’Oréal, KPMG, GSK, BASF, Toyota, KUKA, and Siemens.

Most recently, Euronext – a pan-European stock exchange group with around 1,900 listed issuers and EURO 62 trillion in market capitalization as of Q3 2023 – has chosen to use Board to optimize its financial planning, forecasting, and budgeting.

It speaks to the capability of FP&A software to deliver insights for use cases where spreadsheets would not only struggle, but perhaps fail completely.