# Finance Alliance > The Finance Alliance exists to empower Finance Managers > CFOs with the networking, knowledge-sharing, and collaboration opportunities required to excel in their role. Public Ghost content for AI and LLM tooling. This file includes a bounded export of public pages first, then recent public posts. Append `.md` to any post or page URL to get the content in Markdown (for example, `/example-post.md`). ## Pages ### About URL: https://www.financealliance.io/about/ Last updated: 2024-09-05T10:32:28.000Z Finance Alliance launched in 2022 with a mission to connect a global network of finance leaders to enable and empower each other to thrive in their existing roles and beyond. But *who* is the Finance Alliance for? Whether you want to build key skills and finally land a promotion, or you’re a thought-leader with a passion for sharing knowledge - there’s a place for you here with Finance Alliance. We cover everything from Financial Planning and Analysis (FP&A) to budgeting and forecasting, finance metrics, digital finance transformation, and more - including insider tips to help you align the C-Suite for ultimate collaboration. So, whether you’re a CFO, VP of Finance, Finance Director, Finance Manager, or an aspiring CFO, you’ll feel right at home as a valued member of our community. ### What we do We haven’t been around for long, but we don’t let that slow us down. We’ve achieved a lot since we launched (with many more exciting things to come!) - A content library packed with articles, interviews, and insights from the Finance Alliance team and guest contributors. You’ll also uncover interactive virtual and in-person events, presentations, panels, Q&As, networking opportunities, and more. - Our Slack Community continues to evolve every day. Join finance leaders from all walks of life and get your questions answered! - Our membership packages provide the networking, knowledge-sharing, and collaboration opportunities needed to excel in your role. - Our reports delve into the hottest finance topics to uncover trends, raise awareness, and help finance professionals (like you!) keep up with a rapidly evolving industry. ### We’re proudly part of The Alliance umbrella. [The Alliance](https://allianceled.io/) is the world’s most forward-thinking professional development platform for high-growth organizations and individuals worldwide. Through market-leading accredited courses, unrivaled membership plans, industry-shaping reports, thriving communities, and first-class events, it’s redefining the way companies access education and scale. Other brands part of The Alliance ecosystem includes: Product Marketing Alliance, Sales Enablement Collective, Product-Led Alliance, Future of SaaS, AI Accelerator Institute, Customer Success Collective, CMO Alliance, B2B Marketing Alliance, and more. ![The Alliance logo](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/04/image.png) ### Contact URL: https://www.financealliance.io/contact/ Last updated: 2025-11-25T14:03:59.000Z Want to get in touch? Whether you have a question about the Finance Alliance, content ideas, or you just want to say hi - our door is always open! You can reach the entire team in our Slack community, so feel free to reach out whenever you need us. Or, if you’re after something in particular, here are some links to help point you in the right direction: **Sponsor or partner opportunities:** [sponsor@financealliance.io](mailto:sponsor@financealliance.io) **Press enquiries:** [press@financealliance.io](mailto:press@financealliance.io) **Individual contributions:** [contribute@financealliance.io](mailto:contribute@financealliance.io ) **Becoming an ambassador:** [support@pmmalliance.com](mailto:support@pmmalliance.com) **Anything and everything else:** [hello@financealliance.io](mailto:hello@financealliance.io) We look forward to hearing from you! ### Join the Finance Alliance Community URL: https://www.financealliance.io/community/ Last updated: 2026-07-07T08:11:28.000Z Sign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders. Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. So, what are you waiting for? Sign up today! (it’s free) ### Why join? The Finance Alliance Slack community is a supportive, informal, and inspirational space where finance leaders can gather and discuss with like-minded people. From sharing ideas to offering advice to your peers, our Slack community is the ultimate space for finance pros who want to accelerate their careers. There are plenty of reasons why you should join the community, but here are some more: - Share your burning finance questions and get answers from leading CFOs, VPs of Finance, Finance Directors, Finance Managers, and more. Whether you’re looking for leadership advice or you have complex questions around FP&A, digital finance transformation, etc., the stage is all yours! - Get updates on the latest articles, podcast episodes, news, events, courses, and more from Finance Alliance. - Find your next opportunity or discover fresh talent in our #jobs channel. - Build meaningful connections with people who genuinely want to help you excel in your role – what could be better than that? The best part though? It’s 100% free. *Forever*. ### FAQs **Q: Is there a fee to join?** Nope. As we said, it’s completely free. All you need to get started is sign up for a Slack account and fill in our form. That’s it! **Q: Can I promote my company’s products and services?** We’d rather you didn’t. This is a space for top-level finance executives and industry leaders to share knowledge and learn from each other. If it’s relevant and you’re not running a sales pitch, we may make allowances. **Q: Can I invite other people?** Of course! As long as they are finance professionals like you, they’re more than welcome! ### Subscribe to The Monthly Balance newsletter. URL: https://www.financealliance.io/finance-newsletter/ Last updated: 2025-11-12T09:43:18.000Z ### Stay up-to-date with the latest industry news, updates, events, and more – all sent straight to your inbox each month. Keep up with the latest releases on the Finance Alliance blog and podcast and be the first to know about upcoming events, reports, and industry news! Subscribe to The Monthly Balance newsletter below: ### What’s in it **Articles & interviews:** Instant access to our top articles of the month featured on the Finance Alliance blog. **Podcasts:** Listen to the latest interviews with leading finance pros sharing their expert knowledge, insider tips, and insights to help you thrive within your role. **Events:** Be the first to know about our upcoming events, presentations, and more. **Contribute:** Want to write an article for the site? Appear as a guest on a podcast episode? Take part in shaping our industry reports? Subscribe to The Monthly Balance newsletter and find out what opportunities are available. ### Sign me up! 👆 ### Partner with us 🤝 URL: https://www.financealliance.io/partner-with-us/ Last updated: 2026-05-19T08:52:09.000Z ## Partner with us 🤝 Got a product or service that’s a game-changer for CFOs? Are your services top-notch and guaranteed to make the lives of finance pros that much easier? If so, we (and our members) wanna know about it! Keep reading for a selection of our sponsorship options. And don't forget to get your copy of the media guide. 👇 ### Why partner with Finance Alliance? We unite finance pros and empower them to excel in their roles. We’re talking about some of the greatest leaders in the financial industry – all within your reach if you partner with us. Gain direct access to: - A dedicated community of ambitious CFOs, VPs of Finance, and many more. - Expose your brand to our fast-growing community of engaged Slack members. - Networking at one of our virtual or in-person events. - Broaden your horizons and expand your product’s presence globally – North America, Europe, LATAM, MENA, APAC, we’ve got it all covered. **How can we help?** Whether you’re targeting Senior Finance Executives with a seat on the C-Suite, or you’re promoting a dedicated solution to help businesses streamline FP&A processes, spend management, payment processing, etc., we’ve got something for you - whatever your budget. ### 🤝In-Person Conference Series Bringing together hundreds of CFOs and Finance Leaders in a business, conference-style environment, these are the ultimate opportunity to meet your prospects face to face and have in-depth discussions over a cup of coffee or lunch. ### 🖥 Webinars We’ve got you covered: we’ll guarantee that a certain number of finance leaders will sign up for your webinar. ### 🎟 Virtual summits Thousands of CFOs and finance leaders tune into each of our virtual events. Why wouldn’t you be there? ### 🔦 Content spotlight Want to showcase your solution, product, or thought leadership? Our Content spotlight can help increase your exposure. Provide us with your article and we’ll get it published for the eyes of your target audience and more. ### 📝 White paper syndication Similar to our webinars, we don't leave anything to chance: we’ll guarantee that a certain number of finance leaders will download your content. ### 🍽️ Leadership dinners An evening of food, drink, and conversation with a carefully curated group of marketing leaders. Join an upcoming dinner to expand your network or become a partner and host your own dinner experience for new business opportunities. ### Time to get involved Interested? Get in touch with the team via j.grant@pmmalliance.com or s.davis@pmmalliance.com. ### Create & Contribute URL: https://www.financealliance.io/create-contribute/ Last updated: 2026-01-27T10:23:50.000Z Finance Alliance is a growing network of over **70**,**000** finance professionals from over **170** countries. Each year, our website receives tens of thousands of visits from CFOs, VPs of Finance, FP&A Managers, Finance Directors, and analysts from some of the world's leading companies, all looking to learn more about the latest innovations from the ever-changing world of finance. To feed our ever-expanding community of finance professionals, we're always on the lookout for people just like you to share your expertise and help us shape the next generation of finance pros. If you're interested in sharing your insights and experiences with one of the world's largest communities of executive-level finance professionals, then read on to find out how you can contribute to the Finance Alliance platform. ## Get involved ### Write for us ✍️ Each and every month, 1000s of people make their way onto our site. That’s *a lot* of eyes and exposure for your article. So, whether you want to write about the latest finance trends, data visualization, FP&A, or you’ve got something else in mind, we want to hear more. If you’ve got the insights, we’ve got the platform. Here’s how to contribute 👇🏼 **Step 1: Submit your subject** Before you put your fingers on the keyboard, drop us a line and let us know what you want to write about. Some popular topics include: - Financial Planning & Analysis (FP&A) - Technology and Digital Transformation - Finance Business Partnering - Leadership and Talent Management - Finance Management and Strategy - Building a Successful Finance Function - Mergers & Acquisitions - Risk Management, Cash Management, and Liquidity - Cost Optimization and Operational Efficiency - Industry-Specific Trends and Challenges We’re open to hearing any ideas you have. So, if you don’t see your topic of interest on this list, don’t let that stop you from contributing! **Step 2: Follow the rules** We’re a reasonable bunch and we don’t expect too much, but what we do ask for is: - Articles to be no shorter than 800 words - Any pictures included to be royalty-free - A picture to sit with your contributor profile - A short bio (200 characters or less) Also, individual contributions shouldn’t promote your company’s products or services. For that sort of stuff, we have sponsorship opportunities. *See below for these opportunities!* **Step 3: Submit your work** Reach us by email ([content@financealliance.io](mailto:content@financealliance.io)) and remember to include the link/attachment to your article along with your profile pic and bio - if you’re not already set up as a contributor, that is. Already published something awesome elsewhere? Not a problem. With custom canonical links, you can still share it with our audience too. Yawn 💤 time for the boring bits… **Image policy** We include images with every post. Stock photography will be chosen by our team and will be posted with your entry unless you have a particular image you wish to use. By including any photos, screenshots, or images, you consent to allow Finance Alliance to post this image with proper credit to you and/or the creator. **Link policy** Links in your post should be relevant to the story you’re telling and provide context to your audience. When referring to another article or piece of research, please use proper citations or links to the source material. **Syndication policy** We reserve the right to use any and all contributed content, with credit to any authors, in its entirety or portions for promotional purposes, including in social media, other blogs, or newsletters. Finance Alliance may choose to cross-post to Medium, LinkedIn, or other blogging services. ## Speak at an event 📆 Our CFO and FP&A Summits assemble finance leaders from the world's most innovative organizations. We meet in locations around the world with one goal in mind: to discuss how finance strategies can be developed, deployed, and scaled to create extraordinary business value. If you have insights to share, we want to hear them. Apply below to be considered to speak at one of our summits, where you'll have the chance to address fellow technology leaders and make an impact. [Apply here](https://www.financealliance.io/call-for-speakers-finance-alliance/). ### Guest or host a podcast 🎤 Our podcasts have fast become essential listening for 1,000s of finance professionals. We provide thought leaders with a platform to share not only their experiences but also their unique insights and perspectives on the big trends and developments from within the finance space. Want to feature on a podcast? Or maybe you'd like to host your own? Get in touch with us below to let us know at [content@financealliance.io](mailto:content@financealliance.io)! Podcasts you can be a guest in: - [Two Cents: Finance Talk](https://www.financealliance.io/podcast-two-cents-finance-talk/) - Women in Finance: Leading the Way (coming soon) ### Sponsorship opportunities 💪 More and more organizations are rapidly adopting new finance tools, strategies, technologies, and services and applying them across their business, and you could be there to support them on that journey. If you want to market your products and gain exposure to 1,000s of companies looking for solutions to increase product responsiveness and scale-up intelligence, our sponsorship solutions are for you! Become a sponsor: - Events - Articles - Reports - Podcasts - Webinars - Virtual summits See how you can collaborate with us [here](https://www.financealliance.io/partner-with-us/). ### Contribute to a report 📚 Our regular landscape reports put the spotlight on the latest developments in finance. To continue our industry-leading research, we're always keen to hear from practitioners and experts who have something to share. Have a look at the surveys we're currently running to find out how you can help shape the future of finance. **What we need from you:** 1. A headshot 2. A short 200-word bio 3. A quote **Get in touch with us below:** [content@financealliance.io](mailto:content@financealliance.io) **Reports we're working on:** - State of FP&A, 2025 - Finance Salary Survey, 2026 **Be a course beta tester 🎓** Our expert-led courses aren't created in isolation, which is why we need your help. We seek support from CFOs, FP&A professionals, financial analysts, and more to ensure our training programs deliver everything a participant needs to take the next step in their career. Interested to know what you'll get in return for being a beta tester? First and free access to accredited courses - for life. What we need from you first, though? Candid, thorough, and timely feedback. To join our FA beta tester program, or to learn about other ways to work with us, please email the [team](mailto:courses@financealliance.com). #### Affiliate partner 🤝 With a global network of over **70,000** practitioners, our platform offers a unique opportunity for businesses seeking to get their name in front of an engaged network of finance professionals. If you would like to explore partnership opportunities with Finance Alliance, please email: [pedro@pmmalliance.com](mailto:pedro@pmmalliance.com) ### AMA contributor 🙋‍♀️ Ask Me Anything, or AMAs, are great ways of building your brand awareness, trust, and authority. We're looking for experts in FP&A, finance transformation, leading the finance function, and more, from all industries, to provide their knowledge and expertise for AMAs. If you're interested in participating, get in touch with our team at [alison.m@pmmalliance.com](mailto:alison.m@pmmalliance.com). #### Meet-up organizer 🏘 We've got a few [regional meetups](https://community.allianceled.io/c/community-start-here?post%5Flogin%5Fredirect=https%3A%2F%2Fcommunity.allianceled.io%2F) coming up and we can't wait to see you there! The best part? They're ***free.*** And better yet, you can run your own meetups in your city and chat with your local peers. If you're interested in being a meetup organizer, get in touch with us here. [community@financealliance.io](mailto:community@financealliance.io) ## **Why you should get involved** - **1000** members in the community (and counting!) - **70,000+** members on LinkedIn - **10,000** website visitors each month - **10+** partners ## **Join the Finance Alliance Community** Chat with like-minded finance enthusiasts from around the world! From beginners to experts, the community is for everyone. Find the latest content, job ads, events, and more. ### Meet the team URL: https://www.financealliance.io/meet-the-team/ Last updated: 2025-11-26T18:04:36.000Z ### The Finance Alliance team We’re a small team here at Finance Alliance, but don’t hold that against us. We’re dedicated to uniting finance leaders (like you!) and delivering everything you need to excel within your role - in one place. But *who* are we… exactly? Get to know the people behind the scenes. 👇 **Meet the team 👋🏻** Lovely to meet you! Each one of us has a pivotal role in making sure you feel like the valued community member that you are. Interested in getting to know us more? Feel free to add us on LinkedIn with the links below. Richard King | Founder & CEO | [LinkedIn](https://www.linkedin.com/in/richardking001/) Sabrinthia Donnelly | Senior Copywriter, Content Lead & Strategist | [LinkedIn](https://www.linkedin.com/in/sabrinthia-donnelly-a4b143b4/) Aisha Lawlor | Event Producer | [LinkedIn](https://www.linkedin.com/in/aisha-lawlor/) Harry Ratcliffe | Digital Marketing Executive | [LinkedIn](https://www.linkedin.com/in/harry-ratcliffe-92b485183/) Rebecca Boucher | Director of Community & Events Marketing | [LinkedIn ](https://www.linkedin.com/in/rebeccaboucher500/) Any questions? Contact any of us at any time. See you around! ### Images to host URL: https://www.financealliance.io/images-to-host/ Last updated: 2026-06-25T08:31:05.000Z ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/FP-A_Summit_JAN24_Assets_7.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/05/FA_Website_Banners_1.jpg) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/05/FA_Website_Banners_2.jpg) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/05/FA_Website_Banners_3.jpg) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/LOGO-IMAGE.jpg) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/meta-generic-image.jpg) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/Brain-Blog-header-and-meta-image-4.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/Brian-K-Thumbnail-for-podcast.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/FA_State_of_Finance_Transformation_Report_2022_CTA.jpg) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/FA_Finance_Business_Partnering_Playbook_CTA.jpg) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/FA_Salary_Report_2023_CTA_Banner.jpg) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/FA_AI_In_Finance_Playbook_CTA.jpg) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/FA_Tools_of_Choice_2023_CTA_Banner.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/FA_Tools_of_Choice_2023_CTA_Banner-1.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/past-banner-image.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/FA_9_FP-A_Strategies_CTA2--1-.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/FA_Top_10_skills_every_CFO_should_master_CTA--1-.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/1-1.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/2-1.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/3.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/Newsletter_Upsell_Footer_FA.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/FA_Article_Banners_Assets_6.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/FA_Article_Banners_Assets_5.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/FA_Article_Banners_Assets_4.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/FA_Article_Banners_Assets_3.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/FA_Article_Banners_Assets_2.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/FA_Article_Banners_Assets_.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/10/CFO_Summit_London_NOV24_Email_Banner_.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/02/FP-A_Summit_Dubai_MAY25_Linkedin_Banner_2.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/02/FP-A_Summit_Dubai_MAY25_Linkedin_Banner_.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/Ramp-Lockup-RGB-White.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/06/Logo-with-safe-space---Kaleidoscope.png) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/06/Kaleidoscope-Logo.png) ### Register your interest URL: https://www.financealliance.io/signup/ Last updated: 2024-03-06T10:35:31.000Z The Finance Alliance membership plans are coming in 2023, delivering industry-leading insights from global finance experts. All in one place. Want to be the first to know when our membership is live? Register your interest below.👇 ### Welcome, fellow finance enthusiast 👋 URL: https://www.financealliance.io/freemium/ Last updated: 2023-11-09T10:52:06.000Z Sit back, soak up the blogs, start networking in the community, and let us know if you want to start raising your personal brand. _This page is for subscribers only._ ### Two Cents: Finance Talk URL: https://www.financealliance.io/podcast-two-cents-finance-talk/ Last updated: 2025-06-19T12:52:22.000Z _No content available._ ### Privacy Policy URL: https://www.financealliance.io/privacy-policy/ Last updated: 2022-08-01T08:02:30.000Z [Privacy Policy](https://www.iubenda.com/privacy-policy/24731467 "Privacy Policy") ### State of Finance Transformation Report 2022 URL: https://www.financealliance.io/state-of-finance-transformation-report-2022/ Last updated: 2024-07-18T10:46:38.000Z **Download** [**The State of Finance Transformation Report**](https://productmarketingall.typeform.com/to/f5Yjq66a) **2022!** The **role of finance** within organizations is changing. Gone are the days of spending time manually inputting data into spreadsheets (*yawn*). Thanks to new technologies, the most tedious and mundane tasks can be **automated**. Finance can now step up and offer its unique expertise to influence better-informed decisions that help **drive the business forward**. - But how can finance professionals like you leverage **technology** to drive **positive** **change**? - And how can you convince the CEO that it’s time to invest in **finance** **transformation**? ### You’ll discover the answers to all these questions and more inside [The State of Finance Transformation Report 2022](https://productmarketingall.typeform.com/to/f5Yjq66a). ### Key topics discussed in this report include: 💡 Where finance transformation is **now**. 🔑 **Key drivers** of finance transformation. 💰 The positive impact of **automation in finance**. 🤔 **Common challenges** and how to overcome them. ⚒️ How to develop a **culture of change**. 🔮 What a **successful adoption** of finance transformation looks like. ….and so much more. ### A sneak peek of what’s inside: ► **70.4%** of finance professionals said their organization is currently developing a finance **transformation** **strategy**. ► **92.6%** said the main driver of finance transformation is the desire for **more efficient processes**. ► **55.6%** of finance professionals predict that **big data analytics** will be the biggest game changer for finance over the next 12 months. ► More than half (**55.6%**) of respondents said that **FP&A processes** have benefited the most from digitalization. ### Ready to get stuck in? Grab your copy today and discover the real impact of finance transformation on not just organizations, but the everyday life of finance pros like you! 👇 [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/Newsletter_Upsell_Footer_FA.png) ](https://www.financealliance.io/partner-with-us/) ### ### Get involved URL: https://www.financealliance.io/get-involved/ Last updated: 2023-10-24T08:38:01.000Z We’re actively seeking contributors who want to share their unique expertise with our global audience of finance professionals. Whether you want to grab the mic and speak at an upcoming event, appear as a guest on the [Two Cents: Finance Talk](https://www.financealliance.io/podcast-two-cents-finance-talk/) podcast, host a podcast mini-series, or write an article for our blog - we want to hear from you! Interested? Simply complete the form below and we’ll get back to you shortly. ### Membership URL: https://www.financealliance.io/membership/ Last updated: 2023-11-09T10:32:18.000Z The Finance Alliance membership plans are coming in 2023, delivering industry-leading insights from global finance experts. All in one place. Want to be the first to know when our membership plans are live? Register your interest below.👇 ### Virtual event web background URL: https://www.financealliance.io/virtual-event-web-background/ Last updated: 2023-11-27T14:23:20.000Z ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Chief_Financial_Officer_Summit_JAN23_Assets_6.jpg) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Chief_Financial_Officer_Summit_MAY23_Assets_Background_.png) ### Finance Alliance Salary Survey URL: https://www.financealliance.io/finance-alliance-salary-report/ Last updated: 2024-07-16T08:35:09.000Z ### Complete the survey and be part of one of the most inclusive and in-depth salary reports for finance professionals. 💰 Finance roles are in high demand, so it’s important to make sure you’re being paid your **professional** **worth**. Whether you need to recruit and retain top talent or you’re planning your next big career move, our report breaks down **global salary data** for a variety of finance roles. We’ve put a series of questions to our alliance of finance professionals to deduce: - The average **baseline** **salary** by region. - How salaries vary depending on your **role and seniority**. - Whether there is a discrepancy in pay between **genders**. - The most **lucrative** **industries** for finance professionals. …and so much more. ### What’s in it for you? By taking our survey, you’ll contribute to an in-depth report that you can use to: 🌎 Learn how much your peers are earning in **different regions**. 🪜 Verify your **earning** **potential** as you climb the career ladder. 💰 Find out the average salaries for the most **in-demand finance roles**. 💸 Help negotiate your next **salary**, **pay** **raise**, or **promotion** with confidence. 🔮 Gain insights to help you **recruit and** **retain** **top** **talent** for your organization. [Take the survey](https://www.financealliance.io/finance-alliance-salary-report/) ### The definitive guide to FinOps efficiency [eBook] URL: https://www.financealliance.io/the-definitive-guide-to-finops-efficiency-ebook/ Last updated: 2022-12-13T11:29:48.000Z ### Discover how to optimize your processes and develop the right tech stack for your FinOps function. [Download eBook](https://form.typeform.com/to/G9Xeq7th?typeform-medium=embed-snippet) Want to understand how your peers are managing their **financial reporting**? Look no further. Our friends at Sage conducted a study featuring **250+** companies, covering a wide variety of financial process responsibilities and activities to find out just how you can optimize and enhance your **FinOps processes**. [**Our eBook**](https://productmarketingall.typeform.com/to/G9Xeq7th) reveals all the key takeaways, helping you to: 🥅 Understand the **benchmarks** built by your peers ⚙️ Automate **processes** early 🗺 Develop a **roadmap** for your tech stack ## Here's some facts and figures to whet your appetite... - **CAC** **ratio** is only calaculated **50%** of the time. - **75%** of respondents found that using **spreadsheets** was a primary source of performance metrics calculations. - **68%** of companies report **fragmentation of source data** asa top challenge for financial reporting. - **60%** of companies use manual processes to report **budget vs actuals**. [Download eBook](https://form.typeform.com/to/G9Xeq7th?typeform-medium=embed-snippet) ### Finance Business Partnering Playbook URL: https://www.financealliance.io/finance-business-partnering-playbook/ Last updated: 2024-07-18T11:05:13.000Z ### A step-by-step guide that takes you on a journey from number cruncher to a strategic business partner. Finance business partnering is more than just a job title. It’s a unique combination of personality traits, skills, and capabilities that collide to form world-class business leaders and strategy advisors. If you want to break free from feeling siloed in your role, our step-by-step guide features strategic tips and insights delivered by some of the brightest minds in finance. Start your journey to becoming an irreplaceable asset to your organization.👇 ### What’s inside? In this playbook, you’ll find: - Why it’s so important for finance professionals to move into a partnership role - How to get started and demonstrate your value - Overcoming common barriers and getting a seat at the table - Key traits and skills of a finance business partner - Core principles of financial leadership - How to develop a plan to become a finance business partner All of this and more comes to you from some of the most influential people in finance business partnering, such as FP&A Prep’s Christian Wattig, The Finance Business Partner’s Andrew Jepson, and Business Partnering Institute’s Christian Frantz Hansen. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/Newsletter_Upsell_Footer_FA.png) ](https://www.financealliance.io/partner-with-us/) ### Terms and Conditions URL: https://www.financealliance.io/terms-and-conditions/ Last updated: 2023-01-31T12:15:32.000Z [Terms and Conditions](https://www.iubenda.com/terms-and-conditions/24731467 "Terms and Conditions") ## Posts ### The future CFO: Building a strategic finance function for growth URL: https://www.financealliance.io/the-future-cfo-building-a-strategic-finance-function-for-growth/ Last updated: 2026-09-15T14:45:40.000Z Your CEO wants answers faster. Your board wants more accurate forecasts. The business wants finance involved earlier in decisions about **growth, investment, and costs**. But if your team is still spending hours producing reports, chasing follow-ups and managing manual work, **when does finance get time to look forward?** The future CFO builds a finance function that helps the business **decide what happens next.** In this **live session**, Daniel de Sousa, CEO of Rillion, and Andrew DeLeo, CFO at Outpost, discuss how finance leaders are creating the capacity and capabilities to play a more strategic role: **automating manual work and building operating models that turn financial insight into action.** ## **What you’ll take away:** - **Know what the CEO and board need from finance now:** faster answers, better forecasts, stronger decision support and cost control. - **Find capacity without adding headcount.** See where automation can remove repetitive work and give your team more time for the work that actually matters. - **Build finance around decisions:** understand how operating models, ownership and follow-through turn insight into action. - **Make finance more influential.** Learn how to move from reporting performance to shaping business decisions. - **Build the team for what comes next:** identify the roles, skills and ways of working needed for a more strategic finance function. [Save my seat](https://share-eu1.hsforms.com/12EZyM9trR%5FqcW5hjy-%5FWMA2b1vun) ## **Why attend** - **Stop looking backwards all the time** \- Create more capacity for planning, analysis and decision support by reducing the manual work that consumes your team's time. - **Become a more useful partner to the business** \- Learn how finance can have greater influence with the CEO, board and operational leadership, not just provide the numbers. - **Build a function that can keep up** \- Understand the operating model and capabilities finance needs as expectations rise and decisions get made faster. --- ## **Who should attend** For **CFOs, Finance Directors, VPs and Heads of Finance, Controllers and FP&A Leaders** who want to: - Spend less time on manual work and more on strategic priorities - Increase finance's influence across the business - Improve how finance supports forecasting, planning and decisions - Build a modern finance function that can grow with the business ## **Your speakers:** [**Daniel de Sousa**](https://www.linkedin.com/in/danield11/) *CEO, Rillion* Daniel de Sousa is CEO of Rillion with more than 15 years' experience leading and scaling international SaaS companies, including senior leadership roles at Trivec and Visma. He has worked closely with CFOs and executive teams on growth, digital transformation and building modern finance organizations. [**Andrew DeLeo**](https://www.linkedin.com/in/andrew-deleo/) *CFO, Outpost* Andrew DeLeo leads finance, strategy, capital planning, data and investor relations at Outpost as it scales its nationwide terminal network and technology platform. He brings firsthand experience of balancing operational demands with strategic planning and sustainable growth. ## Save your space Reserve Your Seat × ### Omnichannel finance: Navigating the finance frontier of multi-vertical growth URL: https://www.financealliance.io/omnichannel-finance/ Last updated: 2026-09-11T15:00:20.000Z **Note:* This article is adapted from a talk at a recent* [*Finance Alliance event*](https://www.financealliance.io/events/)*, delivered by Federico Reyes, currently Fractional CFO at BonBon. At the time of the session, Federico was CFO at Magnolia Bakery.* --- ## **Growth is the magic word** Every company wants to grow, and the first place most of us look is new sales channels. That's absolutely a powerful lever when it's operating well. But the truth is, it brings a ton of complexity, and [finance](https://www.financealliance.io/) is the function left holding the bag to manage that complexity. Why is it complex? Because every channel comes with different [metrics](https://www.financealliance.io/32-cfo-kpis/), different unit economics, and different cash implications. Managing an omnichannel business really is like managing several different companies within one. Answering questions in that kind of environment can feel messy. Things overlap, and they're not always perfectly identifiable. But here's the reassuring part: the questions you're actually trying to answer stay the same. Where do we grow? How do we grow? How do we manage [performance](https://www.financealliance.io/flexible-budget-performance-report/)? And how do we manage cash at the same time? Getting there just requires a slightly different skill set. I want to share examples from companies I've worked with in high-growth omnichannel environments. I'll say upfront that these examples aren't a template you should lift and drop into your own organization. How you go about this is part philosophical, part practical, and partly just personal preference. I'm always more interested in hearing how other [finance leaders](https://www.financealliance.io/how-cfos-power-business-strategy/) approach it in their own world than in insisting mine is the only way. [Driving innovation: From CFO “no” to strategic growth partnerDiscover how finance teams can drive innovation, not block it. Learn how strategic finance leaders enable growth through risk-balanced decisions, scenario planning, and capital allocation frameworks.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-661a661e-dd81-4256-993d-59fbe9e66934.png)Finance AllianceKevwe Ijatomi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--43ca7e13-ece9-4411-ae8d-104b775d8277.png)](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) ## **Three very different growth stories** The case studies I draw on come from a few companies. The first is Kind Snacks, an amazing brand and a beautiful company. Kind started in the classic CPG world: grocery, mass, convenience, and club. That's how it built its base and how it grew. Like many companies, it eventually asked the natural next question: how do we grow faster? That search led to international expansion, especially the UK and Canada, then a business-to-business push, and, a few years ago, direct-to-consumer and e-commerce, especially Amazon, as additional growth levers. Nuts.com took almost the exact opposite route. It's a pure-play D2C company, fully focused on the US, that expanded into e-commerce, then into business-to-business, and now has visions of CPG. You can actually see Nuts.com products in airports today. So the path was, quite literally, flipped compared to Kind. Then there's the most complex omnichannel company I've ever seen: Magnolia Bakery. That's where I'll draw most of my examples from, partly because it's my most recent experience and partly because the [complexity](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) there is genuinely instructive. Magnolia's core operations include ten retail bakeries in the US, third-party delivery platforms like DoorDash, Uber Eats, and Grubhub, an advanced ordering channel for web orders and in-store pickup, and a catering operation supported by a commissary. Each of those is its own distinct sales channel. About four years ago, we asked the same question Kind and Nuts.com had asked: how do you expand a very strong consumer brand? Our answer was to do it through CPG. That effort has grown to include a direct-to-consumer e-commerce operation, sales on Amazon, a licensing operation at LaGuardia Airport, an international franchising business with forty stores across the Middle East and Southeast Asia, and, more recently, US franchising, which represents a whole new growth lever built on the same discipline and the same thought process: how do we find new avenues for growth? With that backdrop, I want to walk through four areas: planning, where and how to grow; cost allocations, as an introduction to reporting; [cash flow](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/) management; and, finally, the opportunities this model creates for a company willing to do the work. [Enterprise resource planning for the manufacturing industryAre your manufacturing operations looking a little…rusty? The reason for that could be a lack of a suitable enterprise resource planning (ERP) system…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-e02489aa-7133-458b-bf53-85f1928dbbbc.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Enterprise-resource-planning-for-manufacturing-industry-9161f345-bee8-4c06-83b3-ad8756ccab9c.png)](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/) ## **Planning: treat every vertical like its own startup** Let's start with [planning](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/), because there are no workarounds here. When you're looking at a separate vertical or a new channel, it is, quite literally, its own business plan. It's basically a startup. The way we've approached this is to ask: how would we begin this business if it were standing alone? It's almost a startup within a large company, and it requires its own [strategic plan](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/), its own financial plan, and its own understanding of cash implications, all while figuring out how it fits with the existing business. It's a specific carve-out business case, and because these ventures are usually new territory, you need real experts involved. At Magnolia, for example, we recently evaluated US franchising as a growth lever, and it was a space that simply didn't exist for us before. We recognized we weren't experts in that world, so we worked with people who understood the business deeply, to help us understand the right profile and build credible numbers. One thing to watch out for is the impact on central support. It's easy to get excited and say, okay, great, here's the [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/), here's the top line, here's the cost, here's the cash. But it's just as easy to forget the implications for central support functions like HR, IT, and legal. When we were evaluating CPG, for instance, the business case looked great on its own terms, but there was a real implication for finance, specifically, someone needed to handle receivables that didn't exist before. That's not a departmental problem to sort out later; it's a company-wide implication that needs to be part of the plan from day one. There's also a temptation, when you're evaluating high-impact initiatives, to try to be comprehensive and exhaustive. My advice is: don't. We all have limited [resources](https://www.financealliance.io/what-strategy-needs-from-fp-a/) in terms of time and people. At Magnolia, we recognized that direct-to-consumer served an important strategic objective, but it didn't offer the highest potential for profit-pool growth going forward. So we dedicated limited, but still valuable, time to it, and put the lion's share of our effort into US franchising, making sure we built a very robust plan there, because that's genuinely where the growth was. For expert advice like this straight to your inbox, sign up for Pro+ membership. You'll also get access to hundreds of hours of exclusive video content, a complimentary Summit ticket, and so much more. So, what are you waiting for? [Get Pro+ ](https://www.financealliance.io/pro-plus-membership/) Cash is the constraint. Especially in high-growth environments, a lot of these initiatives are in investment mode, which means they're a use of cash in the short to medium term. In practice, that shapes the conversations you have with investors: when you layer these growth initiatives in, what does the whole company look like? Those conversations tend to be iterative, because it's ultimately the investors' decision in terms of capital structure, whether that's debt, additional equity, or lowering distributions. There are options, and that's honestly the exciting part of the conversation with investors, figuring out what the final plan will actually look like. And finally, a sanity check on focus and execution capability. In [high-growth ](https://www.financealliance.io/why-scenario-modelling-matters-more-in-high-growth-markets-like-austin/)environments, it's very easy to try to boil the ocean and chase everything at once, because there genuinely are a lot of things that could go well and could drive growth. But that's not the point. Omnichannel or not, the essence of a strategic plan that's actually achievable is simplicity and focus. At the end of the day, you have to step back and ask, as we run our day-to-day business, does this make sense, and is it something we can focus on for the next three to five years as an organization? That's a hard question, but answering it is ultimately what setting strategy means. [Building flexibility into your financial strategyWilliam Fink shares how today’s CFOs can lead with foresight by building adaptable financial strategies rooted in data, planning, and cross-functional teamwork.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-e11c3597-5da1-4233-bce9-eddb2add49d8.png)Finance AllianceWilliam Fink![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--41--2dba06c3-5b33-446a-b33c-3fc979d62d7a.png)](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/) _This post is for paying subscribers only._ ### Planning for uncertainty: Rethinking the finance playbook URL: https://www.financealliance.io/rethinking-the-finance-playbook/ Last updated: 2026-09-10T15:54:09.000Z Finance leaders are being asked to make confident decisions in an environment where plan assumptions can change quickly. FX movements, cash positioning, and shifting market conditions can all create exposure that traditional planning approaches struggle to capture. Join **Multiplier** for a practical live exploration of how finance leaders can rethink planning when uncertainty is no longer the exception. Hear from **Amritpal Singh, Co-Founder & President of Field Operations and former CFO at Multiplier**, on why single-scenario planning is no longer enough and how finance leaders can build organizations that are resilient to change, not just models that respond to it. ### What you can expect to learn - Why single-scenario planning is no longer enough, and what finance leaders can do instead - How to build a finance organisation that can absorb changing conditions without breaking - How to connect strategic risk with on-the-ground planning and forecasting - What resilient planning looks like when uncertainty is a constant - How smaller finance teams can build resilience without relying on additional headcount ### The challenges we'll address - **FX and market shifts can create financial exposure that is difficult to plan for.** Learn how to identify where exposure comes from and approach it more strategically. - **Rigid plans can quickly become outdated.** Explore how scenario-based thinking can become a standing capability rather than a one-off exercise. - **Strategic risk can remain disconnected from day-to-day planning.** Understand how finance leaders can bring these conversations closer to the teams building and executing the plan. - **Resilience doesn't always mean a bigger finance team.** Discover how smaller teams can prioritise the capabilities that matter most without adding significant headcount. - **Uncertainty is becoming a constant.** Consider what effective finance leadership looks like when assumptions are continuously shifting. ### Meet the speaker **Amritpal Singh, Co-Founder & President of Field Operations, Multiplier** Amritpal Singh is Co-founder and President of Field Operations at Multiplier. From auditing in London to strategic roles, Amrit saw firsthand how outdated processes held back global hiring. That insight led him to co-found Multiplier. What drives him is a deeper purpose — creating access to quality work worldwide and enabling jobs that fuel both personal growth and public good. ### Keeping up with AI: Modernizing AP and AR URL: https://www.financealliance.io/keeping-up-with-ai-modernizing-ap-and-ar/ Last updated: 2026-09-10T15:34:42.000Z An invoice lands in the queue from a vendor in Frankfurt: three currencies, a PO number that doesn't match NetSuite, no clean line to code it against. The AI model that handled the last thousand invoices without issue stalls on this one, and now someone on the team is doing it by hand anyway. That gap between the pilot and production is where most finance AI projects stall. The model isn't usually the problem. The problem is everything around it: ERPs, procurement tools, CRMs, and inboxes that were never built to talk to each other. This **live session** with Celigo breaks down how finance teams are actually running AI in production across AP and AR, from invoice processing to collections, with the governance controls that keep humans in charge of the decisions that matter. ## **What you’ll take away:** - How AI extracts, validates, and codes international invoices automatically, matching PO line items across Coupa, NetSuite, and Zendesk. - A framework for setting human-in-the-loop thresholds, so high-value transactions and edge cases route to controllers instead of running on autopilot. - The answer to how one finance team cut manual expense report reviews by 70% and automated the four request types that make up 35% of AR inbox traffic. ## **Why attend** - Stop losing time to fragmented systems. Learn how to connect ERPs, procurement tools, CRMs, and shared inboxes into workflows you can actually govern. - Get past the stall between AI pilot and production with real deployment examples, not theoretical use cases. - Learn where to draw the line between what AI executes on its own and what a controller needs to review first. ## **Your speakers:** [**Sandeep Gaddam**](https://www.linkedin.com/in/sandeep-kumar-25391925/) *Director, AI Strategy & Development, Celigo* [**Chris Ferraro**](https://www.linkedin.com/in/chris-ferraro-212790b9/) *Senior Product Marketing Manager, Celigo* [**Alyssa Burns**](https://www.linkedin.com/in/alyssa-burns/) *Director, Financial Operations, Celigo* ## Save your space Reserve Your Seat × ### Enterprise resource planning for the manufacturing industry: A CFO guide URL: https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/ Last updated: 2026-09-10T08:12:47.000Z Are your manufacturing operations looking a little…rusty? The reason for that *could* be a lack of a suitable enterprise resource planning (ERP) system. ERP systems provide real-time data and insights, which makes it easier to make informed and strategic decisions *quickly,* something that CFOs in the [manufacturing industry](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/) rely on to ensure the financial health of the business. If you want to learn more about enterprise resource planning for manufacturing, keep reading as we cover how ERP software can help establish visibility and coordination while improving process efficiency across the business. [Building AI products in finance: the intersection of data, product thinking, and AIThe shift from manual work to AI-assisted work only creates value if you are intentional about how you use the space it opens up.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-3aa70135-eaab-4d62-b586-1d805e333f8f.png)Finance AllianceAbhishek Chandna![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--28--1-e1bf29a3-630f-4d8c-93b3-bf267592d0e7.png)](https://www.financealliance.io/building-ai-products-in-finance-the-intersection-of-data-product-thinking-and-ai/) ## **What is enterprise resource planning for the manufacturing industry?** The global ERP market has moved well past its earlier forecasts. Cloud ERP alone was valued at roughly $65.89 billion in 2025 and is projected to [reach $76.17 billion in 2026](https://cobalt-aerosteon-ae9.notion.site/Cloud-ERP-Market-Size-Share-Competitive-Analysis-2026-2034-37df094c68988093ae2fd4b65641d710), en route to $207.59 billion by 2034 (a 13.4% CAGR) while the total ERP market (cloud plus on-premise) is on track to exceed $106 billion in 2026. Manufacturing enterprise resource planning systems are designed to manage and streamline all the different processes involved in manufacturing. Instead of using lots of different systems for things like inventory, planning what to make, checking quality, and handling money, ERP does it *all*. This makes it easy to see what’s going on company-wide. With an ERP system, you can see what’s happening right now, which helps you to make better decisions *faster*. For finance teams in the manufacturing industry, this type of set-up comes with some great [advantages](https://www.financealliance.io/5-advantages-xp-a/). For one thing, it gives you a clear picture of the money coming in and going out of the company. You can see exactly how much things cost to make, how much you're selling them for, and how much profit you're making. So, when it comes to making decisions about spending and saving, you have all the information you need on hand. With everything integrated into one system, you're not wasting time cross-referencing data from different sources. Instead, you can focus on what really matters: ****driving growth and profitability**. ## **Why is enterprise resource planning integration important in manufacturing?** Manufacturing remains the single largest ERP vertical, now representing about [32% of the overall ERP market](https://www.cargoson.com/en/blog/how-big-is-the-erp-market). If you work in manufacturing, you already understand that efficiency is everything. Enterprise resource planning streamlines operations in the manufacturing industry, ensuring that every part of your process is connected and working together seamlessly. Not only that, but it also quickly improves productivity and [resource management](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). As we’ve mentioned, you’ll be working from real-time data and insights, which will help you run finance processes like payroll and [budgeting](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/) smoothly and without any hiccups. [Cloud ERP now accounts for roughly 70% of the total market](https://www.cargoson.com/en/blog/how-big-is-the-erp-market) and is growing at about 14.5% annually, versus just 2% growth for on-premise systems. Manufacturing companies are the top users of ERP software, leading the way in leveraging these systems for efficiency and growth. [How to design FP&A team structure (with examples)One of the hardest questions to answer about FP&A is ‘what is the typical FP&A team structure?’ This question is so hard to answer because there is no one-size-fits-all…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePatrick Dennehy![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/Copy-of-FA_Website_Article_Images_Author_Highlight--2-.png)](https://www.financealliance.io/fp-a-team-structure/) ## **6 signs your manufacturing company needs an ERP** Wondering if it’s time to invest in an ERP system for your manufacturing company? Here are some clear signs that an ERP could be a game-changer for your business. ### **1\. Inefficient processes** If you're constantly struggling with manual processes and endless data entry, it’s a major red flag. Not only is it tedious, but it also leaves room for mistakes. An ERP system automates these tasks, streamlining your operations and freeing up your team to focus on more strategic activities. ### **2\. Data discrepancies** Ever noticed that numbers don’t always match up? Different departments using different information is a common issue in manufacturing companies without an ERP system. As you can imagine, these discrepancies can lead to misinformed decisions and pretty big mistakes. With a manufacturing enterprise resource planning system, all the [data is centralized](https://www.financealliance.io/7-data-management-problems-and-solutions/). Suddenly, everyone’s on the same page with one central source of truth and no more guessing! [Mastering data storytelling: Turning numbers into actionWant to learn how to transform your data into powerful narratives that shape the future of your business?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-74920fcf-e1d6-4610-a9c1-dbbcf69c64ec.png)Finance AllianceSharon Mahoney![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images-Text--2--fce0e619-3064-4ea5-9509-7eb22abf3a55.png)](https://www.financealliance.io/mastering-data-storytelling/) ### **3\. Lack of real-time information** Need information fast but can’t find it anywhere? If you can’t access up-to-date information when you need it, you’re missing out on valuable opportunities and reacting too slowly to problems. ERP systems provide real-time visibility into all aspects of your operations, so you can make smart decisions on the fly. ### **4\. Scalability issues** As your manufacturing business grows, your systems need to grow with it. If you’re finding it hard to scale operations with your current setup, an ERP system can help. It’s designed to support [business growth](https://www.financealliance.io/spotting-strategic-opportunities-and-driving-business-growth/), making it easier to manage increased production volumes, additional inventory, and expanding teams. ### **5\. Poor customer satisfaction** Delays, errors, and mix-ups can kill your reputation. Enterprise resource planning for manufacturing can streamline your operations, [improve accuracy](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/), and ensure timely deliveries, leading to happier customers and a stronger bottom line. ### **6\. You're still asking your ERP questions instead of giving it instructions** A growing signal that your ERP is behind the curve: your team still manually reviews reports and re-keys decisions rather than working from a system that flags exceptions and proposes actions on its own. [CFO vs. Controller: What’s the difference?In this article, we’re going to try to clear up the confusion. We’ll look at how CFOs and Controllers contribute to a company’s financial health, what their day-to-day responsibilities look like, and why both roles are crucial for businesses of all sizes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceElla Harrison![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/CFO-vs-controller-2.png)](https://www.financealliance.io/cfo-vs-controller/) ## **Types of enterprise resource planning (ERP) systems** ERP systems come in all shapes and sizes, each with its own strengths and weaknesses. Below, we break down the main types of enterprise resource planning (ERP) systems to help you decide which one is the best fit for your needs: ### **On-premise** With an on-premise ERP, the software lives on your company’s servers. This gives you complete control over your data and system, but it also means higher upfront costs for hardware and software, plus the need for in-house IT support. ### **Cloud-based** Cloud-based ERP systems are hosted by a vendor and accessed online. They offer flexibility, lower upfront costs, and easy scalability. However, you'll rely on a stable internet connection and give up some control over your data. ### **Hybrid** A hybrid ERP combines the best of both worlds, letting you choose which functions to keep in-house and which to move to the cloud. While it offers flexibility, it can also be more complex and costly to manage. ### **Industry-specific** Tailored for specific industries like manufacturing, these ERPs offer features and workflows designed to meet your industry’s unique challenges. While they can be highly efficient, they might be less flexible for businesses with diverse needs. ### **Open-source** Open-source ERP systems let you access and modify the software’s code. This offers high customization but requires technical expertise and may have limited vendor support. By understanding these different types, you can choose an ERP system that aligns with your manufacturing business’s specific needs, [budget](https://www.financealliance.io/budget-vs-annual-operating-plan/), and goals. ### **Composable/headless** Rather than one monolithic suite, [manufacturers increasingly assemble ERP](https://erp.today/three-trends-changing-manufacturing-erp-in-2026) from a core system plus best-of-breed modules connected via APIs, allowing continuous, incremental upgrades instead of disruptive rip-and-replace projects [Top 20 Q’s from Fractional CFOsHere are the top 20 questions you might have when planning the transition to fractional CFO…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePeter Turner![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/Copy-of-FA_Website_Article_Images_Author_Highlight-2.png)](https://www.financealliance.io/top-20-qs-from-fractional-cfos/) ## **Key components of ERP in manufacturing** With countless moving parts and interconnected processes, manufacturing facilities (and their [finance teams](https://www.financealliance.io/fp-a-team-structure/)) demand efficient management. But how can a successful enterprise resource planning integration benefit a manufacturing company and [finance](https://www.financealliance.io/finance-careers-how-many-jobs-are-available-in-finance/)? Keep reading to find out. **Inventory management:** Keep track of everything from raw materials to finished products. Optimize stock levels, streamline warehouse operations, and say goodbye to stockouts and overstocking. **Production planning:** ERP assists in scheduling production processes, managing resources, and aligning production targets with market demand. **Quality control and compliance:** If you want to make sure your products meet the highest standards, you need to make quality [control and compliance](https://www.financealliance.io/finance-and-compliance/) a top priority. With the right enterprise resource planning strategy, you can [track quality metrics](https://www.financealliance.io/time-to-value-metric/), manage defects, and stay compliant with industry regulations. In 2026, this is increasingly automated: computer-vision quality inspection now runs at line speed on 100% of units in many plants, catching micro-defects at [accuracy rates 12–18%](https://www.groovyweb.co/blog/erp-ai-manufacturing-guide-2026) above manual human inspection. [Transforming from accounting to FP&A business partneringThinking of moving from accounting to FP&A? Discover the five strategies that are going to help you make the transition into the world of FP&A from Global Finance & Strategy leader (and FP&A expert), Dr. Mohamed El Rouby.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-e35d77f9-74a4-4f73-b334-e0382d5ee621.png)Finance AllianceMohamed El Rouby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--30--8e5d058c-2a77-4ac6-9b8a-0a11b928366a.png)](https://www.financealliance.io/transforming-from-accounting-to-fp-a-business-partnering/) **Financial management:** ERP systems bring all your [financial data](https://www.financealliance.io/data-cleaning-techniques/) into one place. Now you can track costs better, [manage cash flow](https://www.financealliance.io/best-practices-for-optimizing-cash-flow-forecasting/) more efficiently, and make informed decisions to boost your bottom line. **Supply chain management:** Enterprise resource planning [supply chain management](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) is a powerful combination that optimizes the flow of goods and services from raw materials to end customers. It also helps to improve supplier relationships, optimize transportation, and ensure timely deliveries. **Human resources:** ERP integrates HR functions, helping manage employee data, payroll, and [recruitment](https://www.financealliance.io/recruitment-in-finance-4-hiring-hacks/). **Customer relationship management (CRM)**: Build stronger customer relationships. Track interactions, improve customer satisfaction, and drive sales growth. **Equipment performance tracking**: Monitor the health and performance of your machinery to optimize maintenance and reduce downtime. **Purchasing:** Streamline the procurement process, find the best suppliers, and [negotiate better deals](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/). Automated [three-way matching and exception handling](https://aglowiditsolutions.com/blog/manufacturing-erp-trends/) in procurement is now one of the highest-ROI AI use cases in ERP, removing manual touchpoints from high-volume invoice processing. **Artificial intelligence:** There’s a reason almost everyone (and their nans) are talking about [artificial intelligence](https://www.financealliance.io/ai-in-finance-ebook-download/) (AI). It’s incredibly powerful and when you blend it with your ERP system in manufacturing, you can use it to optimize production, predict demand, and improve decision-making. **Connect to the cloud:** Access your ERP system anytime, anywhere, and enjoy the benefits of cloud-based scalability and flexibility. [How I’m thinking about AI after 27 years in financeAfter 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-16619496-2d70-44d0-a070-c012a3821eb0.png)Finance AllianceGeeta Malhotra![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--75e0981c-9dd2-4a55-8d5e-4734d3e6d75d.png)](https://www.financealliance.io/ai-in-finance-business-strategy/) ## **The 2026 shift: agentic AI in manufacturing ERP** Before, "AI in ERP" mostly meant dashboards and predictive alerts that a person still had to act on. In 2026, the story has moved from copilots that answer questions to agents that take action. Deloitte projects agentic AI adoption in manufacturing will roughly quadruple in 2026, from about [6% to 24% of manufacturers](https://www.dataiku.com/blog/manufacturing-ai-trends-2026). Major [ERP vendors have shipped on this](https://www.dataiku.com/blog/manufacturing-ai-trends-2026). Oracle's Agentic Finance initiative now runs autonomous agents inside Oracle Cloud ERP that process multi-channel invoices and flag compliance risks with minimal human intervention, and Infor's Agentic Orchestrator embeds industry-specific agents across manufacturing, supply chain, and finance workflows. In practice, this means: - A planning agent can detect a [late inbound shipment](https://erp.today/erp-technology-developments-impacting-manufacturing-jobs-in-2026), renegotiate a delivery window with the supplier, and reshuffle tomorrow's production schedule overnight, with a plant manager reviewing the outcome rather than initiating it. - Finance directors [increasingly supervise agents rather than run transactions themselves](https://erp.today/erp-technology-developments-impacting-manufacturing-jobs-in-2026), focusing on validating policies, thresholds, and exceptions. - The most reliable [AI wins so far are narrow and data-rich](https://erp.today/erp-technology-developments-impacting-manufacturing-jobs-in-2026): quality-inspection anomaly detection, procurement exception handling, and dynamic inventory reorder points; not open-ended "AI will run your factory" claims. For finance leaders, the practical takeaway hasn't changed in spirit, but it has sharpened. The ROI now comes less from having dashboards and more from deciding which decisions you're comfortable letting a supervised agent make on its own. Also, from building the governance (audit trails, approval thresholds, human sign-off) to do that safely. [What strategy needs from FP&A and why it’s still missingStrategy today is deeply embedded in commercial execution, and compensation increasingly reflects that rather than the quality of a deck.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-5034694d-e704-49d3-a0dd-ca7728b05a2d.png)Finance AllianceNoufal Basheer![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--37--6080019c-23b6-46bd-9c9f-232410372de1.png)](https://www.financealliance.io/what-strategy-needs-from-fp-a/) ## **Challenges and opportunities** Like most things in life, enterprise resource planning for the manufacturing industry isn’t without its hurdles. But not to worry, we’re going to get into the common challenges and provide useful steps to help you overcome them. Some of the most common challenges include: - **Integration issues:** Combining old systems with a new ERP can be complex and disruptive. - **Data migration:** Moving data accurately and efficiently into the new system is crucial. - **Employee resistance:** Overcoming resistance to change and new technology is essential for success. - **Cost:** The initial investment in ERP software, hardware, and training can be significant. In fact, most implementations end up costing [three to four times more](https://www3.technologyevaluation.com/research/article/erp-software-facts-stats-and-lessons-learned.html) than initially budgeted. Alright, now that we’re aware of the potential problems that can occur during the enterprise resource planning integration process, it’s time to look at the solutions: - **Detailed planning:** A well-structured plan outlines goals, timelines, and responsibilities. - **Employee training:** Invest in comprehensive training to build user confidence and adoption. - **Data quality:** Ensure data accuracy and consistency before migration. - **Ongoing support:** Provide continuous support to address issues and maximize system benefits. ### **Why this matters for finance** Finance professionals play a critical role in ERP implementation success. By understanding the challenges and strategies, you can: - **Manage costs:** Effective planning and training can help control expenses and maximize ROI. - **Improve efficiency:** Accurate data and smooth operations lead to cost savings and better resource allocation. - **Support decision-making:** Reliable data and insights empower informed financial decisions. By navigating these challenges and implementing effective strategies, finance teams can contribute significantly to a successful ERP deployment and unlock its full potential for the business. [Building flexibility into your financial strategyWilliam Fink shares how today’s CFOs can lead with foresight by building adaptable financial strategies rooted in data, planning, and cross-functional teamwork.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-e74f2bf3-d772-49ac-80dd-9328c6bff9c3.png)Finance AllianceWilliam Fink![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--41--3be2bab2-cfda-4059-b960-b3c70c16a8a9.png)](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/) ## **Bottom line: is this still relevant in 2026?** Yes. The core argument (centralize data, get real-time visibility, unify finance and operations) is more true today than when this was written, and manufacturing remains ERP's biggest vertical. The parts that needed updating were the market-size figures and the absence of any mention of agentic AI, which is the defining ERP trend of 2026. ### The State of Financial Modelling & Planning 2026 URL: https://www.financealliance.io/the-state-of-financial-modelling-planning-2026-report/ Last updated: 2026-09-11T14:15:25.000Z ## **How 170 finance leaders are rethinking their approach** Financial modelling is being pushed to its limits. [Kaleidoscope](https://kaleidoscope.com/solutions/use-cases/financial-planning-analysis) asked the industry and found out why this is happening... and how AI is changing the picture. See how **170 finance leaders** are rethinking financial modelling with AI in **The State of Financial Modelling & Planning 2026** (and find the approach that fits your business). [Download the report](https://share-eu1.hsforms.com/1GdMXUt88TSKZZtwMmHEuiA2b1vun) ## **A quick preview** [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/09/Screenshot-2026-09-07-at-12.46.28.png)](https://share-eu1.hsforms.com/1GdMXUt88TSKZZtwMmHEuiA2b1vun) ## **What you'll learn** **Where the real time drain is hiding** Finance teams told Kaleidoscope where modelling time actually goes, and it's not where you'd guess. **The hidden cost of spreadsheets** Spreadsheets are still king, but they're quietly costing finance teams. Find out where the friction is. **What reliable AI modelling actually requires** The infrastructure traits AI needs to model your business reliably, not just get the job done faster. **Who wants change most** Can you guess who desires a step-change in modelling the most? [Get your report](https://share-eu1.hsforms.com/1GdMXUt88TSKZZtwMmHEuiA2b1vun) ## **What's inside?** - **Compare AI modelling approaches side by side.** See which one actually fits your business before you commit to one. - **Score your own modelling infrastructure.** Find out whether it can handle growth, or breaks under change. - **Get a concrete framework for choosing the right AI approach.** Apply it directly to your own business. - **Benchmark your time against 170 finance professionals.** Assess how much modelling processes are really costing you, and see how you compare. - **Know what to check before trusting AI with financial data.** Close the gaps most teams miss before they become a problem. [Grab your free report](https://share-eu1.hsforms.com/1GdMXUt88TSKZZtwMmHEuiA2b1vun) ### FP&A at the inflection point: Why the job hasn't changed, even if everything else has URL: https://www.financealliance.io/fp-a-at-the-inflection-point/ Last updated: 2026-08-28T15:00:03.000Z The role of [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) has not changed. We have had a lot of tools over the years, and we have a lot of tools today, but the job itself, the work of [financial planning and analysis](https://www.financealliance.io/top-10-fp-a-skills-to-master/), is fundamentally the same as it has always been. We hold the keys to all the data. I like to ask a room a simple question when I get the chance: who believes their data comes only from [accounting](https://www.financealliance.io/month-end-close-checklist/)? It is always interesting to see the hands go up, because the truth is your data is coming from operations, it is coming from sales, it is coming from every function inside the company, and somehow it all consolidates into FP&A. At the CFO level, we are looking to that function for the information, the [insights](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/), and the decisions that get derived from the data you have your hands on. But the data does not live only in the systems. I ask people whether they get their data only from their computer screen, or whether they also get it from the people around them, the teams they interact with every day. Maybe it is a water cooler conversation, a bathroom conversation, a hallway conversation. Maybe you are out for drinks, or you are on a golf course. Wherever your data comes from inside the company, you also have influences on you from outside the company. That is the world FP&A operates in, and it is the world I want to walk through, because I think it helps to look backward before we go forward, especially now that [AI is coming at all of us](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/) from every direction, every single day. [How I’m thinking about AI after 27 years in financeAfter 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-bdcc69c8-4cf1-4970-baaf-291e8b4427e4.png)Finance AllianceGeeta Malhotra![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--f3859377-ff11-4d9c-9bf6-032f0ab368bc.png)](https://www.financealliance.io/ai-in-finance-business-strategy/) ## **Where we started, and how we got here** I like to ask who in the room remembers green ledger paper and handwriting journal entries. Then I ask who remembers keying into a black screen with green font on a DOS system. Then I ask who was the guinea pig who had to migrate that into a Windows-based system. I am dating myself here, but I remember when Hyperion came out, in the late nineties, and it felt like a [reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) system unlike anything we had seen before, with little pluses and minuses running up and down the screen, and the ability to set your own security permissions. I did a baby bell reintegration when I was at Andersen. We were working out of San Jose, and then back in Texas, in San Antonio, and it was the most massive reporting effort I had ever seen, twenty-seven segments, with everyone in the company permissioned correctly to see the data relevant to them, from the top level all the way down to the person out in the field. From there we moved into a new challenge: we needed all our data in one place, one central source of truth. How often do we still hear that phrase today? That need gave rise to the [ERP system](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/), and everybody had to have one. I think most of us would agree those are some of the clunkiest pieces of software in our tech stack, but they solved a key problem. They kept every transaction from the company in one place, feeding the financials, with separate schedules coming off of them. You may or may not still keep your inventory in that system. You may or may not still run [project management](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) out of it. You almost certainly do not run your sales system through it. A whole wave of bolt-on tools arrived after that ERP era. And from there we moved on to dashboards. I do not think there is anyone left who does not have a dashboard today, although I have been in rooms, within the last twelve months, where a [CFO](https://www.financealliance.io/your-first-90-days-as-cfo/) has told me they have not even made it to dashboards yet. We are all over the map, different companies, different sizes, different industries, all carrying our own tech stack, all talking about how to get started with AI and what it is going to do for us. [The £7.5 million lesson: What real FP&A influence looks likeHow do you close the FP&A influence gap? You clarify, challenge, and connect so that finance moves from being reactive to being influential.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-b98d3163-6a2a-4d53-92da-6dc5b4b053a3.png)Finance AllianceAlexander Roche![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--19--c909816c-42e1-478d-9ce9-346ef0a9272e.png)](https://www.financealliance.io/what-real-fp-a-influence-looks-like/) ## **What the numbers are telling us** I like to bring stats into these conversations, even though they can be all over the place. The FP&A Trends Survey found that 60% of CFOs believe AI will be among the most transformative technologies for finance, yet only 11% are actually using it today, and 35% remain stuck in pilot. When I ask a room who is experimenting with AI versus who is acting on real use cases, versus who has it built into their core, routine workflows, versus who is actually measuring the return on investment, the answers tend to thin out quickly at each step. Very few companies have moved all the way through to active measurement, comparing a real baseline to where they stand today. When I ask what the biggest concern is around [AI adoption](https://www.financealliance.io/when-should-you-actually-trust-ai-in-a-finance-decision/), risk, [data governance](https://www.financealliance.io/7-data-management-problems-and-solutions/), and controls used to top the list on their own. Now they are tied with something else: the accuracy and reliability of the underlying data itself. That was a bit of a surprise to me. For the last couple of years, the biggest holdup I heard from CFOs across the country was fear of leaks and the need for airtight security. That is shifting now that people are actually running use cases and discovering they have to stop mid-process to go check whether the data came out correctly. Teams move quickly, then have to backtrack. And here is the thing: FP&A already understands how that data flows. We know the sourcing, we know who keyed it in, who approved it, why something landed on our desk unapproved. For expert advice like this straight to your inbox, sign up for Pro+ membership. You'll also get access to hundreds of hours of exclusive video content, a complimentary Summit ticket, and so much more. So, what are you waiting for? [Get Pro+ ](https://www.financealliance.io/pro-plus-membership/) Our AI tools are not going to cure bad workflows. They are not going to cure faulty data. They will hand that faulty data back to us, and the insights that come from it, inaccurately, only faster. They will highlight and accentuate where the problems already exist, but they will not fix the workflows or the data underneath them. Too many AI implementations are not returning value in a way we can communicate to our CEOs, and I think that comes down to treating AI as a technology project rather than what it actually is: a [transformation](https://www.financealliance.io/driving-digital-transformation-in-finance/) project involving the entire organization. _This post is for paying subscribers only._ ### Planning for the unexpected: Building flexibility into your financial strategy URL: https://www.financealliance.io/building-flexibility-into-your-financial-strategy/ Last updated: 2026-08-20T10:05:49.000Z **Disclaimer:* This article is based on William Fink's talk at one of our* [*CFO Summits*](https://www.financealliance.io/events/)*, when he was still Executive Vice President and Head of Middle Market Banking at TD Bank (which he refers to in the article). He is now the Executive Vice President, Chief Lending Officer & Head of Commercial Banking at Provident Bank.* --- When we talk about planning for the unexpected, it’s tempting to jump straight into models, metrics, and tools. But before we go there, I want to start with something more fundamental: perspective. In my role at TD Bank, leading U.S. Strategic Partnerships, I’ve had the opportunity to work with a wide range of businesses from small enterprises with $500,000 in revenue to major corporations north of $5 billion. I’ve seen strategy from the inside: through the lens of credit management, risk oversight, and the front lines of mergers, [acquisitions](https://www.financealliance.io/acquisition-financing/), and growth. What I’ve learned is this: no two businesses face the same risks, but *all* of them must deal with uncertainty. That’s why flexibility isn’t just a nice-to-have in financial strategy. It’s a necessity. Whether you're navigating market volatility, [supply chain](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) shocks, or the next big thing you *didn't see coming*, the ability to adapt is what separates resilience from reaction. This isn’t about having all the answers. It’s about asking the right questions and building the frameworks, [teams](https://www.financealliance.io/how-fp-a-teams-build-budgets-and-how-you-can-nail-this-in-interviews/), and tools that allow you to respond when the unpredictable becomes reality. Let’s dive into how you can do that. --- **Topics covered:** - [Scenario planning and risk management](https://www.financealliance.io/p/d03177cd-5787-44c3-a9cf-67ff30d5ffd7/?member%5Fstatus=paid#scenario-planning-and-risk-management) - [The role of AI in scenario planning](https://www.financealliance.io/p/d03177cd-5787-44c3-a9cf-67ff30d5ffd7/?member%5Fstatus=paid#the-role-of-ai-in-scenario-planning) - [Building collaborative teams for financial flexibility](https://www.financealliance.io/p/d03177cd-5787-44c3-a9cf-67ff30d5ffd7/?member%5Fstatus=paid#building-collaborative-teams-for-financial-flexibility) - [Preparing for unpredictable events](https://www.financealliance.io/p/d03177cd-5787-44c3-a9cf-67ff30d5ffd7/?member%5Fstatus=paid#preparing-for-unpredictable-events) - [The importance of contingency planning](https://www.financealliance.io/p/d03177cd-5787-44c3-a9cf-67ff30d5ffd7/?member%5Fstatus=paid#the-importance-of-contingency-planning) - [Stress testing and risk management](https://www.financealliance.io/p/d03177cd-5787-44c3-a9cf-67ff30d5ffd7/?member%5Fstatus=paid#stress-testing-and-risk-management:-pressure-testing-your-assumptions) - [Adapting to future unpredictability](https://www.financealliance.io/p/d03177cd-5787-44c3-a9cf-67ff30d5ffd7/?member%5Fstatus=paid#adapting-to-future-unpredictability:-turning-lessons-into-habits) - [Scenario planning and business continuity](https://www.financealliance.io/p/d03177cd-5787-44c3-a9cf-67ff30d5ffd7/?member%5Fstatus=paid#scenario-planning-and-business-continuity) - [Identifying growth opportunities amidst risks](https://www.financealliance.io/p/d03177cd-5787-44c3-a9cf-67ff30d5ffd7/?member%5Fstatus=paid#identifying-growth-opportunities-amidst-risks) - [Differentiation without excess risk](https://www.financealliance.io/p/d03177cd-5787-44c3-a9cf-67ff30d5ffd7/?member%5Fstatus=paid#differentiation-%3Cem%3Ewithout%3C/em%3E-excess-risk) --- ## **Scenario planning and risk management** When it comes to [managing uncertainty](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/), there are two levers every CFO should have a firm grasp on: scenario planning and risk identification. And if I’m being honest, I could talk about this all day because it’s at the heart of the work I’ve done throughout my career. Let’s start with [scenario planning](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/). Too often, it’s treated as a bolt-on or an isolated exercise, when in reality, it’s a core part of strategic planning. The best-run companies I’ve worked with (and I’ve seen thousands) have one thing in common: strong internal controls supported by dynamic, forward-looking strategic planning processes. And scenario planning sits right in the middle of that. Over the past five years, [contingency planning](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) has become more prominent, and understandably so. Natural disasters, pandemics, supply chain breakdowns, geopolitical tensions... they’ve all made it clear: being reactive isn’t enough. [Lessons on building robust planning, budgeting, and forecasting processesEvery element (foundation, philosophy, rituals, and artefacts) should serve the needs of stakeholders, particularly shareholders.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-51eaf48e-4e3e-4056-8ccc-5e5e211b5417.png)Finance AllianceNoufal Basheer![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-1be3c138-aa30-4961-b627-50e0f374b2d9.jpg)](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/) Historically, contingency planning was focused mainly on recovery and how we bounce back. But today, it has to start with *anticipation*. That’s where scenario planning comes in. And not just for the negative. Think back to the surges in demand for things like Pokémon cards, Cabbage Patch Kids, or even the Pet Rock. Entire supply chains got caught flat-footed. That’s positive disruption, and it's still a missed opportunity if you’re not ready for it. So how do you build good [scenario planning](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/)? It doesn’t mean creating a hundred “what if” models. That’s not efficient. Instead, **focus on three to five well-defined, realistic scenarios**. Start by clarifying your objectives, understanding your key needs, and identifying where the biggest risks lie. Challenge your assumptions continuously. *That’s* what gives the process its power. Depending on your business, you might use advanced modeling tools like Monte Carlo simulations or Oracle Crystal Ball. For high-risk industries like aerospace, nuclear, or defense, etc., you may run out six, even eight standard deviations. But not every business needs that level of rigor. The sophistication of your scenario planning should match the risk you’re managing. That leads us directly into risk. The classic categories still hold true: strategic, operational, financial, legal, [compliance](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/), people, macroeconomic, and reputational. What’s changed is how frequently and how deeply they intersect. Once you identify the types of risk, assess both the *likelihood* and the *impact*. Some risks are high-frequency but low-impact, you plan for those differently than a “black swan” event. In fact, I’d even add a fourth tier of risk above high: *catastrophic*. These are the ones that could end the business. Rare? Yes. But if you're not at least planning around them, you're leaving the door wide open. Now, I’ll share something a bit controversial. Years ago, at Stanford’s risk management program, I heard Dr. Ron Howard (who coined the term “decision analysis”) say something I’ve never forgotten. He said, "*There’s no such thing as a black swan event*." His argument? It’s not that the event is unprecedented, it’s that we failed to anticipate it. COVID-19 wasn’t the first pandemic. The financial crisis wasn’t the first market collapse. We just didn’t frame our planning well enough. You may agree or disagree with that view, and that’s okay. But it brings us back to the same conclusion: scenario planning is about preparing for what’s plausible, even if it’s uncomfortable. It’s about building financial strategies that hold up not just in expected environments, but in the ones we’d rather not think about. [How FP&A Teams Build Budgets?Asif Masani breaks down budgets step-by-step, not just so you understand it, but so you can confidently explain it in your next FP&A interview.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-164.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--66-.png)](https://www.financealliance.io/how-fp-a-teams-build-budgets-and-how-you-can-nail-this-in-interviews/) ## **The role of AI in scenario planning** Let’s talk about tools, specifically AI and machine learning, and how they fit into scenario planning and [risk management](https://www.financealliance.io/ai-in-risk-management-how-banks-can-mitigate-fraud-and-financial-crimes/). Because there’s no question: the tools we have today are more powerful, more sophisticated, and more accessible than ever before. But we’re still just scratching the surface of what they can do. Even before the explosion of AI, we had [machine learning](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/) and it’s been around for a couple of decades. Yet, many organizations haven’t fully leveraged its capabilities. So as much as the buzz around AI is valid, the bigger question is: *what are we doing with the tools we already have?* It starts with understanding what you’re solving for. You can’t let technology drive the strategy. The strategy has to guide the tech. That means clearly defining your objectives, understanding what risks you’re trying to monitor or anticipate, and then identifying the *right* data to support those goals. Because here’s the truth: data for data’s sake is useless. You can be overwhelmed with so much raw information that you lose sight of what really matters. The old phrase comes to mind - you can’t see the forest for the trees. What you want is not just *data*, but *information* \- refined, structured, and relevant. Information that supports decision-making. Whether that’s a go/no-go on an investment, a shift in [working capital strategy](https://www.financealliance.io/the-best-working-capital-strategies-for-fp-a/), or a tactical move to scale up inventory in response to demand. Data should be a driver, not a distraction. And yes, AI can significantly enhance your ability to identify, quantify, and respond to risk. Whether it's flagging changes in customer payment behavior, [monitoring](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) macroeconomic shifts, or detecting patterns in operational performance, AI tools are quickly becoming essential. But they are only as effective as the data you feed them and the clarity of the decisions you want them to support. [Data management](https://www.financealliance.io/7-data-management-problems-and-solutions/), then, becomes just as critical as the analytical models themselves. If you're not investing in clean, accessible, well-governed data structures, even the best tools won't help you move faster or smarter. ****Bottom line:** AI and machine learning are transforming how we plan for uncertainty. But the goal hasn’t changed: better decisions, made faster and with more confidence. The tools are there to serve that purpose. Not the other way around. ## **Building collaborative teams for financial flexibility** One of the most common questions I get (and it’s as old as business itself) is how do you actually get teams to work together across the organization? Especially when you’re trying to build financial flexibility in the face of real risk. Let me tell you, it’s not magic. It’s structure. And most of all, it’s *culture*. At TD, I worked across both the commercial and investment banking sides of the business. That intersection only functions when people collaborate. And true [collaboration](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) doesn’t happen without alignment: alignment of purpose, incentives, and leadership. It starts at the top. *Always*. If the senior leadership team isn’t explicitly setting the tone that working cross-functionally is *expected*, *valued*, and *measured,* it won’t happen consistently. A middle manager deciding that collaboration is important won’t carry enough weight across silos. There will be skepticism. People won’t fully buy in. Culture has to be modeled and reinforced from the top down. At our bank, we’ve taken deliberate steps to operationalize this. Every year, I have specific goals tied to [cross-organizational](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/) engagement. And those goals don’t just live in my performance review, they cascade all the way down. Whether you're in an executive suite or an entry-level position in the commercial bank, you know what we’re collectively aiming to accomplish. You’re part of the effort. When I led [credit management](https://www.financealliance.io/earnings-credit-rate-ecr/), I made this even more explicit. For all 600 of my team members and 14 direct reports, I published clear, prioritized goals for the year. Cross-functional coordination was one of them, and we tracked it. That level of clarity eliminates guesswork. Without that kind of intentional structure, what you get is inconsistency. You’ll see pockets of collaboration and pockets of dysfunction. People will interpret the company’s values and priorities differently and often in ways that align with their personal incentives. And that’s the final piece. Incentives matter. If you don’t align your incentive structures with collaborative behavior, you’ll always have friction. People are smart. They figure out what benefits them. So, if you’re serious about financial flexibility, don’t just focus on tools and strategy. Focus on the *teams* who have to carry it out and build the systems that make it not just possible, but expected. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-bc42448a-13a2-42c3-bc65-86d3c34dbdbb.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-03cd9229-3974-4c0b-b99e-da7108f33505.png)](https://www.financealliance.io/financial-charts-and-graphs/) ## **Preparing for unpredictable events** If you’re a CFO today, the real question isn’t *whether* unpredictable events will impact your business, it’s *when*, and *how deeply*. So, the first step in preparing for the unexpected is accepting that uncertainty isn’t an exception. It’s part of the structure of any organization. Take the American Red Cross as an example. Unpredictability is their entire operating environment. Disasters aren't hypothetical, they’re constant, and global. While your business may not live at that level of volatility, the principle is the same: disruption is baked into the system. Of course, not every unexpected event is catastrophic. Some are small and harmless. For example, your regular mail carrier takes a vacation that you didn’t see it coming, but the impact is negligible. The key is to understand where any given disruption sits on the risk scale. As you move up that scale toward events with real operational or financial impact, your [planning](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/) process becomes critical. You need to ask yourself: *Is our strategy robust enough to handle sudden shifts? Do we revisit it regularly? Are we thinking beyond the next quarter?* It’s not about predicting every single event. That’s impossible. But your job, especially in a [finance leadership](https://www.financealliance.io/top-finance-events/) role, is to make sure the *structure* of your planning process allows your organization to react effectively, safeguard assets, and keep serving your customers, even when the rules of the game change overnight. This is where flexibility becomes a form of discipline. You don’t get there by accident. It’s built, maintained, and constantly tested. [Top 5 communication mistakes to avoid for finance & FP&AThere is no right or wrong way to communicate, but there are clear differentiations between a concise, effective, and impactful communicator versus one that is wordy, robotic, and inconsistent.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-520e8aa6-db94-4e3a-afe3-c7fbfe63198d.png)Finance AllianceRicky Koo![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--40--39fbe5bd-cb64-4bf7-89e5-b5085ab9eeec.png)](https://www.financealliance.io/top-5-communication-mistakes-to-avoid-in-finance-and-fp-a/) ## **The importance of contingency planning** Here’s the reality: most companies have *something* they call a contingency plan. The question is, *is it real*, and *is it current*? I’ll never forget where I was on Friday, March 19, 2020\. The pandemic was rapidly unfolding, and by noon that day, I was responsible for shifting 600 employees to remote work, immediately. We had contingency plans in place. But let’s be honest: most of them were built around weather events and things like power outages, storms, and maybe a building issue, etc. Nothing that resembled a global health crisis requiring total remote capacity overnight. And here’s where our contingency planning was truly tested: did we have enough VPN access for 600 people? No, we didn’t. But because we had at least thought through elements of the scenario, we had multiple vendors identified and on standby. None of them could scale up alone. But together, they bridged the gap until we built the internal infrastructure ourselves over the following weeks. That’s what real contingency planning looks like. It’s not just having a document, it’s having a dynamic, evolving plan that you *test*, *refine*, and *stress regularly*. And, just as importantly, it must be built into your broader [strategic planning](https://www.financealliance.io/how-to-use-a-driver-based-forecast-to-drive-strategic-initiatives/) process. If it’s not part of how you run the business, it will fail when you need it most. [Crisis Management Plan vs Business Continuity PlanBelieve it or not, a crisis management plan is not the same as a business continuity plan. The two are similar in many ways, sure, but they have key differences that set them apart.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-166.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Stock--1-.png)](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) ## **Stress testing and risk management: Pressure-testing your assumptions** In [banking](https://www.financealliance.io/the-rise-of-banking-as-a-service-transforming-the-financial-landscape/), we don’t have the luxury of hoping our plans work. We go through rigorous, mandatory stress tests - the Dodd-Frank Act Stress Test (DFAST), and the Comprehensive Capital Analysis and Review (CCAR) led by the OCC. These aren’t paper exercises. They simulate real-world scenarios: economic downturns, spikes in loan defaults, the sudden loss of key personnel, cyber events, and more. Then they ask one critical question: *How will your organization respond?* These stress tests are updated and evaluated every year. And not every bank passes. We’ve been fortunate to perform well, but that’s because we treat it seriously and not just for [compliance](https://www.financealliance.io/finance-and-compliance/) reasons. The process forces us to think deeply about risk, contingency, and recovery. If you’re a CFO, this mindset matters. Whether you’re in banking, healthcare, manufacturing, or tech, the principles hold. The question isn’t *if* the stress will come. It’s *how ready are you when it does*? Your contingency planning needs to go beyond recovery. It should be baked into the very DNA of your strategic planning. Because when the moment comes, whether it’s a pandemic, a cyberattack, or a sudden market shift, you won’t have time to build a plan. You’ll need to execute one. ## **Adapting to future unpredictability: Turning lessons into habits** One of the most important questions I’ve been asked since the early days of the pandemic is: *What are you doing differently now that you’ve been through something so disruptive?* The truth is, we’ve made some significant shifts in not just our tools, but in our habits. Because unpredictable events, by definition, won’t show up in your planning calendar. What *can* change is how ready you are to respond. At TD, we’ve built a deeply layered risk identification process that starts at the grassroots level and moves upward through the organization. We call it RCSA (Risk and Control Self-Assessment) and it’s something we’ve refined over the last ten years. It catalogs all types of risk: customer, competition, operational, compliance, and more. But in the wake of COVID-19, one area we’ve doubled down on is *process* risk, particularly around technology. Before March 2020, many of us, myself included, took the reliability of our systems for granted. You log into your laptop, your apps connect, and everything just works. But what if it doesn’t? What if there’s a data breach or a widespread system outage? What happens if your technology (the lifeblood of how we work) simply stops? We’ve expanded our planning to answer those questions. And it’s not just limited to technology. We've started to look more closely at *geographic concentration risk*. As a bank with major hubs in Boston, New York, Philadelphia, Washington D.C., and now Charlotte and parts of Florida, we’ve had to think about what happens if one or more of those cities becomes inoperable. We run those scenarios. We stress test our response plans. We ask hard questions: How do we serve customers if a major utility goes down? What happens if a hub city is offline for 48 hours? The goal isn’t to predict every detail of the next crisis. It’s to build the muscle to respond when the unexpected inevitably shows up. The pandemic, as devastating as it was, served as a wake-up call not just for what *did* happen, but for all the things we weren’t yet asking ourselves. Now, we’re asking more and planning smarter. [How to predict revenue in FP&A using machine learningBy analyzing historical sales data, marketing efforts, economic indicators, and even customer sentiment, machine-learning models can identify patterns and trends that are difficult for humans to see.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-3b9306bc-71c0-4d71-85bc-c78b70fb2bc6.png)Finance AllianceGabriela Gutierrez![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--8--833ca525-9281-4ad4-96e3-e4016f4e5501.png)](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/) ## **Scenario planning and business continuity** At this stage, scenario planning isn’t just about how many scenarios you’ve modeled, but the *depth and breadth* of those scenarios. We’ve taken our approach far beyond what we did a decade ago. Now we ask: What does this mean for our customers? What impact could it have on employee operations, credit delinquencies, supply chains, or [liquidity](https://www.financealliance.io/12-liquidity-management-tips-video/)? Business continuity can no longer be an afterthought or a checkbox exercise. It has to be tightly woven into your scenario planning. The plans need to evolve as your business does, as your technology stack changes, as new risks emerge. We’re constantly reworking our approach, and frankly, we’ll never be done. And that’s the point, scenario planning isn’t static. It’s an evolving discipline that keeps pace with your environment. [How CFOs are powering business strategyThis blog explores how today’s CFOs are stepping beyond traditional finance roles to become strategic partners - driving growth, shaping business decisions, and turning financial insight into organizational impact.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-167.png)Finance AllianceNick Rumball![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--52--2.png)](https://www.financealliance.io/how-cfos-power-business-strategy/) ## **Identifying growth opportunities amidst risks** One comment that really stuck with me in this discussion was the idea that risk planning often focuses so heavily on *loss prevention* that we forget about the cost of *missed opportunity*. It’s a great point, and one that’s especially relevant for CFOs. [Risk management](https://www.financealliance.io/the-cfo-role-in-cyber-risk-management/) shouldn’t just be about downside protection. It should also help surface upside potential. In my time leading risk management at TD, I spent a lot of time thinking through this. Any good board will ask, “How are we protected against loss?” But the proactive boards and the truly forward-looking leadership teams will also ask: *What have we missed? And what did it cost us?* That’s where decision [analysis](https://www.financealliance.io/closing-the-gap-between-analysis-and-executive-action/) comes into play. Let’s take lending as a simple example: We know the loans we made. But what about the loans we *didn’t* make? If we loosened or adjusted our underwriting criteria in a certain direction, what’s the tradeoff? How much additional credit risk might we be taking on, and what additional revenue might that generate? You can model that. You can quantify it. You can track where the opportunity zones are, and where the risk thresholds start to get uncomfortable. That’s real, actionable insight. And it’s where finance can step out of the role of “guardrail” and into the role of strategic growth enabler. [What strategy needs from FP&A and why it’s still missingStrategy today is deeply embedded in commercial execution, and compensation increasingly reflects that rather than the quality of a deck.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-bea8a1b3-f3d7-462d-9eae-316a36f0d5e1.png)Finance AllianceNoufal Basheer![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--37--3dea6e73-c9cc-4bbd-a3cb-8fae406a2bf5.png)](https://www.financealliance.io/what-strategy-needs-from-fp-a/) ## **Differentiation *without* excess risk** Most companies can serve a mainstream need; that’s table stakes. But the best companies, the ones that lead in their industries, go a step further. They figure out how to identify *opportunities their competitors haven’t seen,* and they do it without taking on excessive risk. That’s the difference-maker. Can you find that edge in the market where your business can move faster, respond smarter, or deliver more value, without compromising your risk profile? This kind of strategic differentiation starts with analysis, yes. But it also starts with experience. You need to challenge assumptions, run probability models, and ask *what if*; not just to avoid downside, but to uncover potential. It’s about framing the problem, not solving it on instinct alone. ## **Conclusion: Building resilience through foresight** Planning for the unexpected isn’t about having all the answers, it’s about building the processes, teams, and mindset to respond when the questions change. Whether you're facing a global crisis or a once-in-a-generation opportunity, the principles stay the same: plan thoroughly, manage risk intentionally, collaborate across your organization, and always leave room for adaptation. Flexibility isn’t a soft skill. In today’s world, it’s a financial imperative, and it’s the edge that will define tomorrow’s market leaders. --- **By joining our** [**Slack community**](https://www.financealliance.io/community/)**, you get access to a network of CFOs and other finance leaders like yourself, as well as the opportunity to ask and answer questions and see what your peers are up to.** [Join the Finance Alliance Slack CommunitySign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today! Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-8a675540-f8d9-468c-8e6a-7d8c5f50f644.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Meta_Images_Slack-Community-1-6c832291-6ef6-45d9-8c07-18fae6f96c11.jpg)](https://www.financealliance.io/community/) ### Top 5 communication mistakes to avoid for finance & FP&A professionals URL: https://www.financealliance.io/top-5-communication-mistakes-to-avoid-in-finance-and-fp-a/ Last updated: 2026-08-20T08:17:13.000Z ## **1\. Letting your nerves lead you** There are very few people who actually don't feel any nerves before public speaking. If someone says they aren't nervous at all before presenting a [forecast](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) to the leadership team or walking into a board review, it's very likely they're lying (or trying to convince themselves to feel less nervous by saying that). One of the common mistakes I see [finance professionals](https://www.financealliance.io/why-most-finance-professionals-feel-underpaid/) making is when they let nerves take over. It's reasonable and okay to feel nervous, but don't let them lead you. Don't let your nerves make you decide to change a slide in your [budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) presentation last minute. Don't let your nerves cause you to speed through your [variance analysis](https://www.financealliance.io/the-variance-analysis-cycle/) to "get it over with." Don't let your nerves sell yourself short and make your voice sound too soft and lacking in confidence when you're delivering a recommendation to the CFO. I still remember the first time I presented a [forecast](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) change to our CFO. I was the expert in that part of the business. I had rehearsed it so many times in my head that by the time I joined the meeting, my nerves had already rewritten my delivery for me. Shortly after I started speaking, I saw him glance at his watch. This threw me off and I began to speak twice as fast as normal because I didn't want to "waste his time." In that moment, I convinced myself that the room wouldn't have the patience for it. The reality: Nobody in that room was thinking about my nerves. They were thinking about the numbers. They were thinking about what needs to change in the [forecast](https://www.financealliance.io/how-to-forecast-inventories/). They were eager to hear why. That gap between what I imagined they were judging and what they actually cared about is exactly why this mistake is so common (and so avoidable). At the end of the day, one simple reminder that I like to think of whenever I feel nervousness creep up is: "They're just people." Repeat this in your mind, no matter who you are meeting with or who you are speaking to. I don't care if it's the CEO of the company, the head of investor relations, or a VP with 40 years of experience in corporate finance. They're. Just. People. [How to turn forecasting & budgeting mistakes into successesExplore key lessons in implementation processes and corporate strategy, and how you can use them to achieve real, tangible results in your FP&A function.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-f382a76a-2ffc-4f03-a1c4-4cbd76ba6023.png)Finance AllianceJames Manning![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--9--5f32bc1b-6c38-4f0a-b696-5b94782eed1f.png)](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) ## **2\. Lack of clear outcome** There is one easy test I encourage all of my clients and workshop participants to use with every single conversation (and yes, I do mean every single [conversation](https://www.financealliance.io/rethinking-the-finops-tech-stack/), big or small). That test is to ask: "What do I want them to think, feel, or do differently?" In any interaction (whether it's a quarterly business review, a budget request meeting, or a casual check-in with your [business partner](https://www.financealliance.io/transforming-from-accounting-to-fp-a-business-partnering/)) there has to be an identifiable outcome. Outcomes give purpose. Purpose gives reason for time. Without purpose, people will feel as though you're wasting their time. Or, worse, that you don't know what you're talking about. Earlier in my career, I sat in on a QBR where my manager at the time talked our VP through every line of a variance analysis in exact chronological order. That's the way I'd built the model, but it wasn't the way they actually needed to hear it. It didn't land. About 5 minutes in, I watched the VP start looking at his phone. I immediately was uncomfortable and surprised. Now in hindsight, I understand what happened there. Sure, it was a bit rude, but it was also honest feedback and [data](https://www.financealliance.io/mastering-data-storytelling/). The VP had no idea what my manager wanted him to *do* with the information we were sharing, so his brain simply opted out. He didn't understand the purpose. He was likely thinking "this could've been an email." That was the moment I started asking myself the "think, feel, or do" question before every single conversation, not just the big ones. And it's the single biggest shift that changed how people responded to me in a room. **So keep this in mind the next time you're preparing for any interactions. Think of your audience. Then identify what it is that you want them to think, feel, or do differently.** Do you want them to think about a risk or opportunity with a different perspective? Do you want them to feel confident about the forecast, concerned about a trend, or motivated to act on a cost savings initiative? Or do you want them to approve a decision, [reallocate resources](https://www.financealliance.io/operationalizing-productivity-in-a-1b-construction-vertical/), or change course on a plan? The more clear you are with your outcome, the more purpose your entire presentation or conversation will have. And that is the key ingredient to establishing respect, [trust](https://www.financealliance.io/ai-you-can-defend-resolving-the-speed-trust-tradeoff-in-finance/), and commitment from the audience, especially when your audience is a room full of executives who have little time and high expectations. [When insight stalls: Closing the gap between analysis and executive actionCaroline shares a practical diagnostic for where decision cycles stall, and the operating moves high-performing CFO organizations use to restore speed without sacrificing rigor.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-e4df0e51-0aea-4b34-bb7a-c548f6765cad.png)Finance AllianceCaroline McAuliffe![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--32--9a63baca-665f-4e93-8ca0-35347884f5bb.png)](https://www.financealliance.io/closing-the-gap-between-analysis-and-executive-action/) ## **3\. Ignoring yourself** Do you often use a filler word because you're afraid of pauses? Do you tend to blink a lot when you start talking fast through a dense financial model? Do you constantly have a furrowed look in your eyebrows when someone challenges your assumptions? These are all easy questions to answer if you raise your self-awareness as a speaker or communicator. It's too easy nowadays to NOT get this right. You can record yourself on your phone. Record yourself on Zoom. Record yourself on Teams. Whatever mode of [technology](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/) you're comfortable with, there shouldn't be an excuse as to why you're not self-aware of where you fall on the spectrum of bad to great communication. Watching yourself speak is the single best way to pick up on cues and habits that you otherwise may not have noticed. People are rarely going to give you the honest feedback that you very much need to improve your [communication skills](https://www.financealliance.io/stakeholder-communication-plan/). Your business partners aren't going to tell you that your budget walkthrough was confusing. They don't want to risk making you feel bad or having to deal with the consequences of you responding poorly to their feedback. They aren't going to tell you that you used "um" 10 times within 5 minutes while presenting your long-range plan. They're not going to tell you that your body language gives off a snobby vibe or the way you stand makes you look timid. I'll admit this one is uncomfortable to talk about because I lived it multiple times throughout my [career](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) (and still do). I once rewatched a recording of myself, a Finance Business Partner at the time, speaking to a leadership team about their Q3 forecast during COVID. I counted the number of times I said "um," "so," or "right" and was mortified. I had no idea I did it that frequently. Nobody had ever told me; not because they didn't notice, but because it's simply not something colleagues typically bring up with each other. That recording taught me more about my communication habits in fifteen minutes than years of assuming I was fine ever did. When you record yourself and watch it (as painful and cringy as you feel about it), I can almost guarantee that you will pick up on at least one behavior that you would really benefit from refining or changing. The first step is self-awareness, and there is no better way to gain self-awareness than to witness yourself in action from a third party, objective point of view. ## **4\. Too much detail** That saying "less is more" is not just with fashion. It goes with PowerPoint presentations. It goes with 1-on-1s with your manager. And it especially goes for finance professionals because we are [wired for detail](https://www.financealliance.io/top-10-fp-a-skills-to-master/). We live in spreadsheets, models, and reconciliations all day. So when it's time to communicate, we default to what we know: the [data](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/), the granularity, the backup. And that's when people go on and on about something which leaves the other party wondering "why are they telling me this?" During my process of becoming a professional certified coach, I had to have hundreds of hours of professional training, role playing, and research spent on deciphering how people behave and how to navigate conversations with clients that may be leading to nowhere. I loved it, because it reminded me of my Psychology roots at UCLA. One of the biggest skills is to be able to take in a large amount of information (we call this the "story," when people spend a lot of time going through details in explaining or describing a situation) then distilling it down and filtering it down ultimately to the root of the issue. But not everybody is a professional trained coach. They aren't trained to listen intently and they aren't equipped with the right tools and abilities to listen for what's not being said. I think about this every time I remember a specific budget walkthrough with my business partner and his [leadership](https://www.financealliance.io/transitioning-to-fractional-financial-leadership-how-to-lead-in-2-4-days/) team. I was a Senior Manager at the time and my business partner was a C-staff member leading a global team of over 2,000 people. I brought every backup tab "just in case" someone asked. Someone did ask, but not about the backup. They asked, "So what do you actually want us to do here?" I hadn't even gotten to that part yet. I was still three tabs deep into showing the "what." I didn't even touch the "why" or the "how". That's the moment I built my own "need to know vs. nice to know" filter in my communication, and I use it before every single deliverable I send out now, whether it's a one-pager or a board deck. Remember that as a communicator, it's your duty to include what's absolutely necessary and leave out the details as a "nice to have" if someone wants those details. A very effective way of doing this is chunking out your message in two areas: **1) Need to know vs. 2) Nice to know.** Need to know should only have 2–3 sentences or bullet points. Imagine an elevator door closing in on you as you're delivering your forecast summary to the CFO. What are the 2–3 things this audience NEEDS to know before the elevator doors are closing? That's what you start with. Leave the rest (the bridge walks, the line-item details, the backup tabs) as optional details. [Communication plan with stakeholders: a five-step guideMaster stakeholder communication in five clear steps. You can use this guide to craft clear, consistent communication that keeps everyone aligned and engaged.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-fc9f3de2-ede6-402e-9d00-f0ae4520503a.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/5-step-stakeholder-communication-plan-06714727-b50c-4c10-b6e3-b28d48495997.png)](https://www.financealliance.io/stakeholder-communication-plan/) ## **5\. Using AI (or yourself) to script everything** This is a very common one that brings people comfort when they script out what they are going to say. Or they ask Claude and ChatGPT for a perfectly written script and [start memorizing it like they're studying for an exam](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/). I see this often with finance professionals preparing for big presentations: annual planning reviews, investor updates, stakeholder readouts. While scripting can help with getting all of your ideas and thoughts down, the major drawback is that it can easily get you into a mindset of having to say the "right" things and pressure you to feel as though you have to memorize every single word and sentence. It strips you of your individuality and quiets your true voice. What this can look like is when you're speaking (whether on stage or presenting during a meeting) if you happen to forget or "go blank" with what you were going to say, it can make you feel even more flustered when you can't find the exact words you had rehearsed. You start sweating. Your heart races. Your face turns bright red. English is my second language. Being an immigrant from Hong Kong, Cantonese is my first and native language, so there are times I may stumble on a specific word or two, especially when I'm speaking fast. Because of this insecurity, I used to script out my presentations word for word. I'd even write out the transitions. Then, during one quarter-end review when I was a [Financial Analyst](https://www.financealliance.io/fp-a-salary-and-career-path-guide/), a stakeholder asked a question that wasn't in my script, and I froze. Not because I didn't know the answer, but because my brain was still trying to find my way back to the exact sentence I had memorized. That was the last time I fully scripted anything. Now I brain-dump everything I might want to say, circle the 2–3 points that actually matter, and let the rest come out naturally. Ironically, that's when people started telling me I sounded more confident and not less prepared. Now, even if I find myself mispronouncing a particular word or going blank during a presentation, I no longer get embarrassed by it. I no longer need to search for that perfectly memorized line or script. Sometimes stumbling, mispronouncing, or blanking mid-thought just makes us more human. And that's okay. Here's what I encourage people to do: if you have a lot of data or information you want to share, do a "**brain dump**". Type out everything you might want to cover. Bullet points are great for this. Then, instead of using that as the main part of your presentation, pick and choose the top 2–3 "need to know" items and bring those to the center of your presentation. Leave the rest in your notes. When you script everything you're about to say, it can also leave you sounding (and feeling) a bit robotic and rigid. It doesn't give space for your [personality](https://www.financealliance.io/10-cfo-personality-traits/) or uniqueness to come through, and it will often leave your audience feeling bored or even frustrated; and in finance, a disengaged audience means your insights don't land and your recommendations don't get acted on. If any or all of the above 5 mistakes resonate with you, I encourage you to practice refining that in your communication. There is no right or wrong way to communicate, but there are clear differentiations between a concise, effective, and impactful communicator versus one that is wordy, robotic, and inconsistent. Try incorporating ONE small change or refinement in your communication style at a time. No need to get overwhelmed with trying to become an expert in all of the above. Over time, as you make these small but powerful shifts in your delivery and preparation, you will find that your audience is much more engaged and resonate with your message. Have some fun with it and practice finding your unique voice! ### **About the author** Ricky Koo is the Head of GTM & Technology/Engineering Financial Planning & Analysis at Autodesk, a Fortune 500 global technology company, and one of the rare finance executives who will tell you his psychology degree did more for his career than his CPA license. After 20+ years across JPMorgan Chase, Deloitte, Visa, Oracle, and Autodesk, he frequently draws from those experiences which helped shape everything he now teaches. He is also an ICF PCC-credentialed executive coach and UC Berkeley Extension instructor who sits in an unusual space: the technical rigor of a seasoned finance leader and the psychological fluency to understand why the most skilled professionals often go unrecognized. --- [**Become an Insider member**](https://www.financealliance.io/insider-membership-plan/) **(at no cost) to get access to exclusive content and insights from top finance leaders.** [Free Finance Alliance Membership - Become an InsiderJoin 1,000s other finance professionals and test drive your Finance Alliance membership without spending a dime.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-72b8f072-17d7-4023-9327-6de3105566a1.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Membership_Meta_Images_3-3e2584df-70dd-430d-9a85-6625a780ea40.png)](https://www.financealliance.io/insider-membership-plan/) ### AI you can defend: Resolving the speed-trust tradeoff in finance URL: https://www.financealliance.io/ai-you-can-defend-resolving-the-speed-trust-tradeoff-in-finance/ Last updated: 2026-08-14T15:11:57.000Z **This article is based on Junaid's brilliant talk at our FP&A Summit San Jose when he worked at Shadowfax AI.** --- Before starting Shadowfax AI, I spent about six years at Alteryx and, before that, roughly a decade in management consulting at Monitor Deloitte, advising executive leaders, including CFOs, on profitable [growth strategies](https://www.financealliance.io/guide-to-company-growth/). That mix of enterprise software and advisory work is why I keep coming back to one question: why has finance been so [slow to put AI to work](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/) on its real analytical core? This isn't a pitch for our platform, but an argument for how finance leaders should think about AI, why the current front-runner philosophy for adopting it is wrong for most organizations, and what a more pragmatic path looks like: **balancing AI's** [**productivity**](https://www.financealliance.io/operationalizing-productivity-in-a-1b-construction-vertical/) **gains against the precision, rigor, and defensibility our profession demands.** ## **A new dividing line** Historically, the dividing line in enterprise productivity has been pre- versus post-industrial revolution, which unfolded over roughly a century starting in the 1760s, driving the mechanization and mass production behind our modern standard of living. Today, a new dividing line is emerging: pre- versus post-LLM. We're no longer talking about mechanical automation but cognitive automation, and given that Western GDP is collectively more than 80% services, that has profound implications for society. [How I’m thinking about AI after 27 years in financeAfter 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-6fa3f759-9b77-4981-bdbc-2ad94b1b2500.png)Finance AllianceGeeta Malhotra![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--cfc6b799-7fe4-4fa5-a7d5-593d9aeaf094.png)](https://www.financealliance.io/ai-in-finance-business-strategy/) ## **The scale of investment, and the gap in results** This has driven staggering investment: what started as roughly eighty billion dollars in the year after ChatGPT launched is now projected by IDC to reach six hundred seventy billion dollars by 2027, an eightfold increase, excluding hardware spending, which is roughly similar in size. Yet the return has been hard to pin down. Deloitte reports that business cases initially projected to pay back in seven to twelve months are now being readjusted to four- or five-year paybacks, and BCG found that only about 5% of organizations reported achieving value at scale, while 60% reported no gains whatsoever. We're early in this, but it looks like a lot of organizations are kicking the accountability can down the road. ## **What's actually happening inside finance** Two surveys stand out. Bain Capital Ventures found that 71% of CFOs had not adopted AI in any meaningful capacity, and LEK found that 89% were not actively using it in production. That tracks, to a point: [finance](https://www.financealliance.io/) has unique constraints, from regulatory scrutiny to audit trails, and it runs on deterministic outputs. Being directionally accurate might pass in marketing, but it doesn't fly in finance. The metric I find more telling is what's happening among practitioners themselves. A study from the Association for Finance Professionals found that one in five finance professionals use AI regularly, and three in five have tried it sporadically, but only 9% reported using it for actual analytic work: [variance analysis](https://www.financealliance.io/the-variance-analysis-cycle/), [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), reconciliations, the tasks that eat up the most time. That's the number that matters, because if productivity gains are coming, that's where they have to come from. Contrast that with software engineering, an adjacent function with similar characteristics. For expert advice like this straight to your inbox, sign up for Pro+ membership. You'll also get access to hundreds of hours of exclusive video content, a complimentary Summit ticket, and so much more. So, what are you waiting for? [Get Pro+ ](https://www.financealliance.io/pro-plus-membership/) The largest survey, from Stack Overflow, found that 70% of engineering teams are already using AI-first workflows, with 88% planning to within the year, and among elite Bay Area software companies, that number approaches 100%, with self-reported productivity gains of two to ten times. My own co-founder, a principal engineer with decades at some of the biggest names in the Valley, reports being ten times more productive using these [tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/). ## **Why the gap comes down to trust** Why such a large gap between two functions with similar underlying characteristics? When you ask [FP&A professionals](https://www.financealliance.io/fast-tracking-your-fp-a-career/) why they aren't using AI, the single biggest theme is trust. Having talked to hundreds of them, the explanations sound like this: our work has fuzzy rules, scattered data, and layers of stacked assumptions. It's reasonable, but nearly all of those arguments apply to software engineering too, where codebases are arguably more fragmented, tribal knowledge is worse, and specs are often vague. So that explains part of the gap, but not all of it. There's something deeper, which I call the verifiability problem. In domains where LLMs have had a transformative impact, marketing, copywriting, legal drafting, even software engineering, it's relatively easy to judge output just by inspecting it: you ask for something, look at what comes back, and know almost instantly whether it's good. Finance analytics doesn't work that way, because these problems get solved by writing code, and LLMs aren't naturally suited to a thirty-year-old [spreadsheet](https://www.financealliance.io/claude-in-excel-for-finance/) paradigm with its own built-in limitations. [Mastering data storytelling: Turning numbers into actionWant to learn how to transform your data into powerful narratives that shape the future of your business?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-d2a2dbd4-e970-4b38-b4dd-6fb1194b4d4f.png)Finance AllianceSharon Mahoney![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images-Text--2--a427c269-e66a-4749-a270-7a1a225fda4c.png)](https://www.financealliance.io/mastering-data-storytelling/) Real-world work requires cleaning data, joining it across sources, and stacking assumptions well beyond a simple lookup, so hand a real problem to an LLM and you typically get back hundreds of lines of Python. It's one thing for code to run and another for it to be correct, and unless you have real coding expertise, you often can't tell the difference. Ask the same real-world question twice, an hour apart, and you'll often get slightly different answers, not because the [model is wrong](https://www.financealliance.io/the-hidden-danger-of-look-ahead-bias-in-financial-llms/), but because the assumptions stacked across a dozen steps were made probabilistically and never surfaced. Unless those assumptions are made deterministic upfront, your outputs won't be either, and that's why nobody will stake their reputation on it. ## **Two philosophies, and why I don't buy the first one** Everyone wants to move faster and do less manual work. The reluctance isn't about the outcome; it's the skepticism. And what nobody will compromise on, alongside accuracy, is transparency, speed, and efficiency. The prevailing consensus among some of the loudest voices in this space is a capital-T Transformation approach, sometimes called the ServiceNow-Palantir model: transform your systems of record and operating systems, rebuild the organization from the inside out, and reskill everyone as coders. It's top-down, expensive, high-friction, and full of points of failure. It might work for the very largest organizations, and it will make consultants a great deal of money through multi-year engagements, but top-down edicts are notoriously hard to make stick. The board can pressure the C-suite, and the C-suite can pressure middle management, but the person with hands on the keyboard is the one who ultimately decides whether to use the tool. Grand mandates to reinvent an entire organization rarely help the practitioners actually doing the work. [Secure-by-design FP&A: How finance automation can speed planning and shrink riskSecure-by-design FP&A is not a constraint on ambition, but what makes ambitious automation sustainable.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-6cded816-4eb6-4e44-9f1c-bd364bc1d43d.png)Finance AllianceAmal Mammadov![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--21--55579756-4014-4b52-ab0f-097be3b63461.png)](https://www.financealliance.io/secure-by-design-fp-a-automating-planning-without-expanding-the-fraud-surface/) ## **A more pragmatic framework: TVCD** I'd propose a more pragmatic, higher-ROI framework built around **four pillars**: transparency, value stream–based prioritization, core context, and decentralized execution. My co-founders and I built our entire platform around these four ideas, but the philosophy behind them matters independent of any specific product. ### **1\. Transparency** Transparency is the foundational pillar, because it's the raw ingredient that produces trust. If transactions are the flow metric for a company, trust is the balance sheet metric, the accrual you build over time, and the more experience you gain, the more you realize that almost everything in life, not just business, is rate-limited by the speed of trust. You can't mandate trust. Anyone with kids knows that ordering them to tell the truth doesn't work; you earn it through rigor, accuracy, and verifiability. Finance people trust, but they verify. So for AI to work in finance, it cannot be a black box, and this has to remain a human-in-the-loop process, not a fully autonomous one. A finance professional empowered by AI is like a human with a vehicle instead of a horse: fundamentally more capable, essentially wearing an Ironman suit. But this isn't a predator drone operating on its own. It's closer to a fighter jet's avionics, extraordinarily powerful, but still piloted by a [human](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/). When evaluating any AI tool, the real question is whether trust and verifiability were designed in from the start, or bolted on afterward as an afterthought. [How AI is transforming financial modeling & sales forecasting in enterprise techThis article explores how AI is transforming financial modeling and sales forecasting (two pillars of enterprise strategy) and helping finance teams shift from reactive to proactive operations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-4a3f02c6-ad49-419e-a9e5-89ad330c399d.png)Finance AllianceSupreeth Meka![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--56--c1e0b0c7-6079-41b7-b2a5-57a7b1296dca.png)](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) ### **2\. Value stream focus** The second pillar is value stream focus. Whenever there's a technology frenzy like this one, especially with prominent voices insisting that wholesale operating-model transformation is required, you get a lot of scattered, noisy experimentation. Experimentation itself isn't bad; the problem is too many disconnected efforts running in random directions without a guiding framework, because that's when you're not actually making progress, just generating noise. Instead, harness that energy using a value stream lens. In my experience across companies ranging from roughly a hundred million to two billion dollars in revenue, most [FP&A functions](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) boil down to the same six core value streams, each containing its own set of core activities. Just as a business creates value through three basic levers, revenue growth, cost reduction, and capital efficiency, AI in finance creates value through three parallel levers. The first is data automation: faster, automated movement from source to output without cutting IT out of the process, so the line of business is empowered rather than working around the system. The second is diagnostic deep-dive automation: getting rid of the detective work that turns a routine variance spike into a multi-day investigation, by mapping the driver tree behind it so the "why" surfaces immediately. The third is predictive modeling: building the scenario models everyone is constantly asked for, faster and with a defensible range of outcomes, rather than reconstructing inputs, outputs, and logic from scratch every time. Take your value streams and activities, build an honest baseline, and overlay these three levers on top. The opportunity tends to become clear within minutes. [How generative AI is transforming financeFinancial advisors could use AI to generate initial investment recommendations while focusing their expertise on understanding client needs and providing personalized guidance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-9c7b1dc3-9693-4a61-adea-1c1ebc428a95.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--9--227a63c2-eecc-4ace-be97-f35c802cbb4b.png)](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) ### **Core context** The third pillar is core context, and it's the antidote to a common excuse: that this work requires exhaustive ontologies, clean master data, and formal documentation before you can even begin. Some organizations genuinely do have sophisticated documentation and taxonomies already, and if that's you, great. But it isn't a prerequisite, because AI thrives on unstructured information. Email threads, open-ended documents, [Slack conversations](https://www.financealliance.io/community/), canonical spreadsheets, even what's sitting in someone's head that they can just dictate into a phone, all of that counts as usable business context. You do need a minimum viable knowledge base to get accurate, good outputs from AI, but the lift required to assemble it is a days- or weeks-long effort, not an ERP implementation, and the mental model a lot of people apply to this needs to be rethought completely. AI can't read your mind, but it's remarkably good at taking randomly structured thoughts and making sense of them. ### **Decentralized execution** The fourth and final pillar is decentralized execution. As experienced operators know, top-down edicts rarely work; mandate an ambiguous initiative from the top of the organization and watch it stall somewhere in middle management. If you genuinely believe in a human-in-the-loop model, you have to empower your people, especially your best performers, to exercise real agency. Give them the degrees of freedom to take chances, and give them clear outer bounds to operate within. Yes, coordinate the effort centrally. Yes, give people input on priorities. But within secure, well-governed environments, let your strongest people actually take the shots, rather than having executives design projects in an off-site with no ground-level business context. When you see something work, let it be decentralized and let the team scale it themselves, and do what the best software companies do: celebrate the win and scale it. That bottom-up model, not top-down mandates, is exactly what drove software engineering's adoption curve, and it's a far more effective and higher-likelihood path than trying to force adoption on the knowledge workers who are actually on the front lines running the business. [Communicating financials to execs: A 5-step approachYou can do a very impressive analysis and still contribute nothing meaningful to decision-making. In my mind, insight is simple: it’s information that decision-makers don’t currently know, and that helps them make better decisions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-8406e61f-569b-45f7-8872-09c41684a7cd.png)Finance AllianceAnders Liu-Lindberg![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--18--229a169a-0c6c-4e55-ac34-29642959f86d.png)](https://www.financealliance.io/how-to-communicate-financials-to-executives/) ## **Where this leaves us** We're at a seminal moment, and an anxious one for finance professionals. There's real uncertainty about careers, and teams are being asked to do more with less while holding the same rigor and quality standards. Trust remains the number one barrier keeping teams from experimenting with this technology on the work that actually matters. As finance leaders, you have a choice. You can embrace capital-T transformation and eventually watch the energy run out until everyone quietly returns to business as usual. Or you can take agency, prioritize AI tools that are transparent, verifiable, and reasonably governed, and focus your team's efforts on the value streams baselined against the levers that matter. Don't let great become the enemy of good; get the essentials right, and let your best people lead. Finance professionals often rate-limit their ability to harness AI by what's possible inside a spreadsheet tool built in the 1980s. That's a legitimate choice, but what's possible today goes well beyond forcing everything through a spreadsheet. In my view, this was never a smarter-model problem. It's an architecture and user experience problem, worth understanding before deciding what's right for your organization. --- **As a Pro+ member, don't forget to use your free pass on** [**one of our upcoming in-person events**](https://www.financealliance.io/events/)**.** ### 10 tips to eliminate forecast bias URL: https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/ Last updated: 2026-08-10T09:59:32.000Z No matter how sophisticated our models get, forecast bias has a sneaky way of slipping into our [financial plans](https://www.financealliance.io/10-big-picture-financial-planning-steps/). It's just part of being human, but when our numbers consistently miss the mark, the impact can be *huge* (according to [Institute of Business Forecasting research](https://demand-planning.com/2025/11/02/the-case-for-demand-planning-period/), a 15% improvement in forecast accuracy delivers a pre-tax profitability improvement of 3% or higher). Things like missed targets and misaligned [budgets](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) are just some examples of what can go wrong. So, if you want to stop forecast bias from creeping in, here are 10 practical ways to put an end to it. [Top-Down vs. Bottom-Up Forecasting | Finance AllianceTop-down vs bottom-up forecasting: Which method should you use to create accurate sales forecasts? Find out in this article.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-253edb6e-f254-4f74-ba5e-e3bb323aaf53.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images-Text--1--dacee73a-0062-4565-bc89-a7d95fad68eb.png)](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) ## **What is forecast bias?** Before we get into the tips, here's a quick refresher. Forecast bias is the tendency of a forecast to consistently overestimate or underestimate actual outcomes. It's not being wrong every now and then. It's being wrong in a predictable direction. There are two main types: - **Positive bias:** your forecast is consistently higher than actual results. - **Negative bias:** your forecast is consistently lower than actual results. In practical terms, positive bias means you **over-forecast**. Negative bias means you **under-forecast**. Both create problems. Over-forecasting can lead to overspending, overhiring, or excess inventory. Under-forecasting can leave you understaffed, understocked, or unprepared for demand. ### **Forecast bias formula** Use this formula: > **Forecast bias = (Forecast - Actual) / Actual × 100** For example, if you forecast $110,000 in revenue and actual revenue is $100,000, your forecast bias is **+10%**. That means you over-forecast by 10%. If that pattern repeats, the issue isn't random forecast error. It's systemic bias. ### **Forecast bias vs forecast accuracy** Forecast bias and forecast accuracy are related, but they're not the same thing. **Forecast accuracy** measures how close your forecast is to actual results. **Forecast bias** measures whether you tend to miss high or low. You need both to understand not just how wrong the forecast was, but *how* it keeps going wrong. ### **Common causes of forecast bias** Before you can reduce forecast bias, it helps to understand what's usually driving it. In most companies, bias comes from a small set of repeating patterns, often systemic bias baked into how teams plan and communicate. - **Optimism bias:** Teams assume outcomes will improve faster or more easily than the data supports. - **Sandbagging bias:** Forecasts are set artificially low so targets are easier to beat. - **Anchoring bias:** People rely too heavily on an existing number, like last year's plan or the initial budget. - **Recency bias:** The latest result shapes the next forecast more than the full trend warrants. - **Confirmation bias:** Teams often struggle to [balance data with personal knowledge](https://www.customersuccesscollective.com/how-to-balance-data-with-personal-knowledge-for-customer-success/), favoring data that supports their existing view and discounting anything that challenges it. When you can identify the source of the bias, choosing the right fix becomes a lot more straightforward. [When AI models cheat: The danger of look-ahead bias in financial LLMsThe next time someone shows you an AI model with incredible historical trading returns, remember to ask the critical question: is it predicting, or is it remembering?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-52911ede-00c6-4f84-8174-79c16dbd754c.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--7--f77b4b08-75f3-4bac-b917-c62312a52427.png)](https://www.financealliance.io/the-hidden-danger-of-look-ahead-bias-in-financial-llms/) ## **10 tips to remove forecast bias** Forecasting is hard enough without our own brains getting in the way. But that's exactly what forecast bias does. It quietly distorts our predictions based on hopes, fears, incentives, and past experiences. But you can take steps to eliminate biased forecasts from your financial planning process. Here are 10 tips to help you do just that: ### **1\. Separate your forecasts from your targets** One of the fastest ways to introduce forecast bias is to confuse what you hope will happen (your target) with what you think will happen (your forecast). As you can imagine, this can lead to overly optimistic (or pessimistic) numbers that don't reflect reality, which can set you up for future issues. When leadership pressures teams to "hit the target" in forecasts, the data can get a lot more flexible. Unfortunately, this flexibility doesn't always mean accuracy, which results in financial plans built on shaky foundations. One of the best ways to reduce forecast bias is to make sure they're objective. Yes, your targets can be ambitious, but they need to be realistic. ****Pro move:** Tie forecast accuracy (not just target achievement) into team KPIs to shift mindsets. ### **2\. Use historical data as your anchor** When you rely on historical data, you give yourself (and your forecast) an unbiased starting point and help [prevent poor customer data hygiene](https://www.customersuccesscollective.com/bad-customer-data-hygiene/). Unlike relying on your own thoughts and opinions, historical data shows exactly what happened. By anchoring your forecasts to this past reality, you ground your expectations, making it easier to spot predictable patterns (like seasonality) and reality-check overly optimistic or pessimistic thinking. So, before making any forward-looking assumptions, run a full historical trend [analysis](https://www.financealliance.io/the-variance-analysis-cycle/) and *then* look for patterns (margin shifts, growth rates, etc.). [How to create a revenue plan that doesn’t fall apart by Q3This blog will walk you through the main components of a revenue plan, what good revenue planning involves, when to start and how to put together a plan that gets results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-119.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--3.png)](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) ### **3\. Implement rolling forecasts** Static forecasts often grow stale while [rolling forecasts](https://www.financealliance.io/rolling-forecast-best-practices/) help prevent bias because they transform forecasting into a continuous process, not a fixed annual event. Here are a few more reasons why rolling forecasts are an effective way to reduce forecast bias: - They reduces building pressure to hit arbitrary year-end targets, which can lead to end-of-period manipulation. - [Rolling forecasts](https://www.financealliance.io/rolling-forecast-best-practices/) ensures that regular reality checks against actual results are being carried out, helping to spotlight any existing biases. - They make it easier to incorporate new information rather than relying on outdated assumptions. ### **4\. Incentivize accuracy, not just performance** Why do forecasts often miss the mark? Well, it often boils down to what we *reward*. If we solely focus on rewarding teams for hitting targets (regardless of how realistic their initial predictions were), we inadvertently encourage bias. To foster more accurate and reliable forecasts, consider a dual approach to incentives: - Track and value both outcome achievement AND forecast precision. - Recognize and celebrate teams that demonstrate [forecasting accuracy](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/). - Implement [clear customer success metrics](https://www.customersuccesscollective.com/customer-success-metrics/) for forecast accuracy. - Consider linking a portion of performance-based rewards to forecast accuracy. By [shifting the incentive structure](https://www.customersuccesscollective.com/the-rise-of-sales-first-cultures/) to value both performance and accuracy, you can create a culture that prioritizes transparency, realism, and credibility in your forecasting process. ### **5\. Leverage predictive analytics and AI** At our recent CFO Summit in Austin, David Chavez, CFO and SVP at CVS Health, posed a question to the room: > "So AI isn't valuable because it's there. It's valuable because of how intelligent can be in how you're operating within your organization. Its value actually is because it compresses the time between what happened and what do you do about it and how are you making decisions on a near real time basis. > "If I offered you right now a 10% improvement in forecast accuracy, would you take it? Yes or no?" The answer was, inevitably, yes, to which he added: > "Okay. What if I told you that the real value wasn't in accuracy but it was actually in getting the answer sooner? \[...\] The objective is not necessarily having a prettier forecast, but improving decision quality." Human intuition has a place, but machines are great at spotting patterns we can't see. So, if you're still relying purely on [Excel](https://www.financealliance.io/chatgpt-for-excel/) and gut feelings, you're inviting forecast bias. To help reduce bias forecasting, you could try using tools that apply predictive analytics to historical and external data (market trends, customer behavior, and supply chain signals, etc.). You could also use AI to benchmark human-driven forecasts against machine predictions to uncover hidden biases. A peer-reviewed academic paper found that a machine-learning-based forecasting methodology [reduces mean absolute average forecast errors by approximately 7%](https://www.cfo.com/news/ai-enabled-methodology-improves-earnings-forecast-accuracy-by-7-Oliver-Binz/808889/) compared with the commonly used "random walk" forecasting method. AI doesn’t just spit out numbers, it can help you build a smarter forecast bias formula by highlighting systemic errors. ### **6\. Run multiple scenario analyses** Thinking through different possibilities ("what ifs") stops you from just sticking to one guess, which might be too hopeful or the opposite. Running multiple [scenario analyses](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/) encourages you to consider a range of potential outcomes beyond a single, potentially biased "most likely" scenario. As a result, it gives you a broader perspective and reduces the impact of any single optimistic or pessimistic viewpoint. By modeling different possibilities, you acknowledge uncertainty and avoid anchoring your forecast to a single, potentially flawed assumption. > "It's also critical that the finance team is used to running scenarios and this is where FP&A teams can actually shine: where they should be able to run scenario analysis for every decision or even a potential idea that the management team has. What the short and long term implications are. > "There is a lot of focus in my business on capital allocation. And at the end of the day, every company has limited money. You can put it either towards short-term goals or you can put it towards long-term goals. And balancing that is tricky, but it's essential. > "And I found that having our FP&A teams constantly constantly running the scenarios and then communicating that with the board and the management team \[e.g., you could put this money towards marketing and that may lead to certain leads in the next six months versus you could put that money towards product innovation and that could lead to product growth in the next two years\] is pretty important." – **Sana Deshmoka, VP of Strategic Finance at Yext** [Scenario planning: Navigate uncertainty with confidenceLearn about the key benefits of scenario planning and how it can be integrated into strategic and financial planning cycles.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-fc7c611e-a67b-4153-9dde-68ba5ff0050c.png)Finance AllianceCesar Gomez Nieto![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--1-e4989f81-3add-411c-bbf7-658e0e6a12d3.png)](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/) **Quick fire tips:** - Always model at least three outcomes: best case, base case, worst case. - Stress test your base assumptions: What if growth slows by 10%? What if input costs spike 20%? > Scenario modeling = less emotional attachment to one perfect, likely-biased view of the future. ### **7\. Encourage cross-functional input** Finance doesn't always have perfect visibility into what's happening on in every department. Sales, marketing, operations, etc., they all hold real insights that can help de-bias your forecast assumptions. Of course, you need to be mindful of anchoring bias from these groups too. Like everyone else, they have their own incentives, which is why you should encourage open discussion, not blind acceptance. Remember that the goal is to leverage the knowledge of each team, [drive company-wide alignment](https://www.customersuccesscollective.com/connecting-the-dots-how-cs-ops-drives-company-wide-alignment/), and still maintain objectivity. To help encourage more input from other departments, you could try building a collaborative forecasting session where key players check assumptions. Or you could ask different teams what they're seeing before you lock forecasts. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-121.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-1.png)](https://www.financealliance.io/financial-charts-and-graphs/) ### **8\. Conduct post-forecast bias audits** A post-forecast bias audit is a review of past forecasts compared to actual results. The goal with an audit like this is to identify any systematic overestimations or underestimations, revealing potential biases in the forecasting process. A bias audit is a really useful, but often overlooked, way to find consistent problems in how we forecast. The best time to do one is right after each forecasting period ends. That's when you should compare what you predicted with what actually happened. ****Pro tip:** Chart your bias over time by product, region, or business unit to find chronic issues. ### **9\. Introduce a challenger forecast** Sometimes the best way to fight bias is to actively court disagreement. That's what a challenger forecast does. Instead of just relying on the initial forecast (often the "baseline" or "official" forecast), a challenger forecast involves creating an alternative prediction, often built with different assumptions, data sources, or methodologies. This deliberately introduces a contrasting viewpoint, forcing a deeper examination of the original forecast's underlying logic and potential blind spots. Helpful tips: - Designate an individual or team (maybe FP&A or an external consultant) to build an independent forecast without seeing the first version. - Compare results and investigate why they differ. ### **10\. Train teams on cognitive bias awareness** Most people aren't even aware of how their brains trick them during forecasting. One of the best ways to reduce forecast bias is with proper training that helps bring subconscious biases into the light where they can be managed. Tips: - Run workshops on common biases (like anchoring, optimism, and recency bias) and provide practical strategies for recognizing and mitigating them, especially when working with [teams that have mixed data literacy](https://www.customersuccesscollective.com/mixed-data-literacy/). - Develop easy-to-use checklists or "bias busters" for planners, offering simple questions to consider when setting forecast numbers to challenge their assumptions. Encourage your team to ask questions like: *"Am I adjusting this number based on evidence - or just instinct?"* *"What's the worst-case version of this assumption?"* *"What does the data actually say?"* Over time, bias forecasting becomes something your entire team knows to watch out for, not just the finance nerds (no judgment). ## **Is it *really* possible to reduce forecasting bias?** You can’t 100% eliminate forecast bias, but you can absolutely control it. Every tip you layer into your process makes your forecasts stronger, sharper, and more credible. **🎯 Challenge for you:** Pick three tips from this list and implement them in your next forecast cycle. Track the difference. In a few quarters, you won’t just have better numbers, you'll have a more trustworthy, respected finance function. --- ### **Subscribe to The Monthly Balance newsletter** Stay up-to-date with the latest industry news, updates, events, and more, all sent straight to your inbox each month. Keep up with the latest releases on the Finance Alliance blog and be the first to know about upcoming events, reports, and industry news! [Subscribe to the newsletter ](https://www.financealliance.io/finance-newsletter/) ### What strategy needs from FP&A and why it's still missing URL: https://www.financealliance.io/what-strategy-needs-from-fp-a/ Last updated: 2026-07-28T09:21:21.000Z Over fourteen years in this profession, I've spent eight years in [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) and six in strategy, so I've sat on both sides of the table. I started at Boston Consulting Group in Mumbai, pivoted into FP&A, and led the function at Algani Industries, a large conglomerate in Kuwait. A year in treasury followed, then four more years back at BCG in New York and Dubai. About two years ago I moved to PepsiCo, where I now lead [global strategy](https://www.financealliance.io/how-cfos-power-business-strategy/) and transformation for away from home, the channel outside traditional retail: restaurants, movie theaters, hotel catering, airports, and entertainment venues. When I was in FP&A, I always wanted more from strategy. Now that I'm in strategy, I want more from FP&A. What follows is how much has changed in the relationship between the two functions, especially since COVID, and where I think they still owe each other more than they're giving. [The £7.5 million lesson: What real FP&A influence looks likeHow do you close the FP&A influence gap? You clarify, challenge, and connect so that finance moves from being reactive to being influential.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-86799c97-0a6e-4faf-b426-ec63773852a1.png)Finance AllianceAlexander Roche![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--19--5473cf67-bc89-4181-973b-ada5957c544d.png)](https://www.financealliance.io/what-real-fp-a-influence-looks-like/) ## **The world moved faster than the models did** The pace of business has changed. Technology has made things faster, shareholder expectations have shifted, and the market itself has been a bit wonky, as anyone working with publicly listed companies will understand. The traditional discounted cash flow model isn't capturing value the way it used to, traditional CAPM doesn't really work for valuing equity anymore, and a company like SpaceX shows returns that traditional finance theory wouldn't predict. Pressure testing assumptions and sizing the prize for a strategy project are hygiene factors at this point. What matters more is how the old handoff between strategy and finance used to work: strategy designs a plan, FP&A validates it afterward, sizes the [P&L](https://www.financealliance.io/tariff-impact-beyond-headlines-to-the-p-l-reality-for-emerging-businesses/), and once approved, moves it into execution with KPIs monitored quarterly. That model is breaking down on two fronts. [Driver-based forecasting for FP&A to align strategy with realityIf you haven’t tried driver-based forecasting for FP&A, this is your chance to really align your strategy with reality.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-313c2721-90b7-4c76-9a99-824cfa2b7ff5.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--73--baa867e2-8663-4716-84ab-d6550f392e11.png)](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/) ## **Strategy refreshes are happening far more often** The first is that strategy refreshes are happening much more frequently. When I started at BCG in 2010, the norm was a five-year strategy with a refresh roughly every two years, and you knew the cadence well enough to time the pitch for the next one. Even hundred and two hundred billion dollar organizations, typically slow to pivot, are now running three-year strategies instead of ten-year ones. In areas where AI is influencing the business, like marketing and customer experience, refreshes happen almost every year because the underlying technology moves so quickly. Six months ago, conversations about AI and CX centered on omnichannel integration. Then [generative AI](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) moved into agentic AI, well suited to that same work. In just the last couple of weeks, the conversation has shifted again, to voice-based agents replacing humans in contact centers. I was recently on a vendor call where fifteen minutes in, someone joined to tell us we'd been talking to an agent the entire time, and none of us had noticed. That's how fast everything is moving now. If there's one overarching theme to what strategy needs from finance today, it's speed and agility, whether that shows up in how KPIs are defined, how they're measured, or how resources get allocated. [Building AI products in finance: the intersection of data, product thinking, and AIThe shift from manual work to AI-assisted work only creates value if you are intentional about how you use the space it opens up.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-cd3c3826-0fdc-4ac4-82f0-f92d51d7955a.png)Finance AllianceAbhishek Chandna![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--28--1-d503e201-6976-49ad-922a-c2498cc10bbe.png)](https://www.financealliance.io/building-ai-products-in-finance-the-intersection-of-data-product-thinking-and-ai/) ## **Two things that need to change** Strategy teams frequently complain that FP&A's indicators aren't timely enough to be useful, and it's a fair complaint. It isn't because finance is trying to make strategy's life difficult. The market is changing so fast that by the time data comes in, it's often too late to act on it. ### **Earlier FP&A involvement** The traditional sequence uses historical data, sizes the prize, runs ROI assessments, and only then brings in [FP&A](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) to validate. That sequence isn't reliable anymore, because historic data is a poor predictor of what's coming. We once ran a category growth strategy worth billions of dollars and sent it to FP&A, who told us the margin assumption was off by thousands of basis points, because geopolitical shifts and tariffs had moved the numbers. Six months of work went down the drain because we hadn't brought FP&A in early enough, and I put some of that blame on strategy. We should be the ones ensuring FP&A is involved early, so assumptions get pressure tested before too much time is sunk. ### **Dynamic resource allocation** The second issue sits inside the annual budgeting cycle. Most finance teams start with an annual budget, then reforecast quarterly against variance. Equinor, the Norwegian national oil company, is a well-known exception, largely because its majority shareholder, the Norwegian government, gives it flexibility to treat project financing as a separate [capital allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) process outside the annual budget. Most organizations are still working in an older mode: this is the budget, now pivot around that baseline. I think quarterly reforecasting isn't enough anymore, and rebudgeting needs to become the norm. At PepsiCo, we realized that hunting for new AI agent use cases was more effective than farming existing ones for certain segments, which meant pivoting headcount out of frontline roles. That [reduces OpEx but creates a CapEx outflow](https://www.financealliance.io/capex-vs-opex/) in the early years, and getting that reallocation past a CFO mid-cycle is genuinely difficult, since it means changing the plan while still working against the budget. [Lessons on building robust planning, budgeting, and forecasting processesEvery element (foundation, philosophy, rituals, and artefacts) should serve the needs of stakeholders, particularly shareholders.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-00a57264-b1be-43bd-b816-3d4e7e2fa74e.png)Finance AllianceNoufal Basheer![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-d7d0dcec-6b5a-4bb3-b47c-ee1bd54736eb.jpg)](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/) ## **Why this keeps falling on FP&A's shoulders** This is fundamentally a process and design issue, and having been in FP&A myself, I sympathize with colleagues still there. FP&A is often trapped in a reporting treadmill: closing out the fourth quarter, moving straight into budgeting, then monthly reporting through the first quarter, followed by reforecasting. That cycle leaves little bandwidth for anything else, and it isn't a capacity problem solved by adding headcount, since the constraint is the narrow window in which things need to get done, and done right. On top of that, FP&A is often asked to validate decisions too late. A mentor of mine, Robert Edmond, former CFO of Unilever, used to describe strategy as Einstein and finance as Newton: strategy pushes the boundaries of what's possible, finance keeps you grounded in what's realistic. Strategy thinks in an ambiguous eighty-twenty world, focused on the handful of things that drive most of the impact, while FP&A speaks the language of precision, margin down to the last decimal point. There's a middle ground where some precision can be sacrificed for directional accuracy, since strategy cares more about winning share directionally, and quickly, than whether a number is exactly ten percent or twelve. FP&A's training favors precision over quick judgment, and that's where the two functions need a shared language. [Navigating uncertainty: Why agile FP&A is your competitive edgeMaster change with agile FP&A. Turn uncertainty into opportunity through flexible forecasting, data-driven decisions, and smarter collaboration.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-2ed11448-86e2-40f6-8f2b-e2602f05947b.png)Finance AllianceImane Haouassia![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--33--1bdba4bf-f7db-4efd-b7e1-9a7b8992a727.png)](https://www.financealliance.io/navigating-uncertainty-why-agile-fp-a-is-your-competitive-edge/) ## **Where common ground already exists** FP&A has a real opportunity to automate reporting and lean more on AI for insight generation. A consulting client I worked with years ago, one of the largest technology service providers in the world, asked us to diagnose their finance function. We found they could have automated roughly eighty percent of their own [reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) metrics, despite building exactly this kind of automation for clients, and simply hadn't done it, for no reason beyond inertia. AWS does this well, with integrated dashboards that talk to each other quickly, close to a gold standard in the industry. AI-enabled insight tools have also improved enormously in the last year. Models that felt unusable twelve months ago are now genuinely good at drawing on different data sources and surfacing trends. My caveat is that AI should be used for hypothesis generation, not solution generation. It's excellent at generating a hypothesis, but a human with real understanding of the business still needs to validate it. ## **Moving from a budgeting mindset to an investment mindset** Finance also needs to move away from a pure budgeting mindset toward a portfolio one, the way pharmaceutical companies manage a pipeline of drug candidates. That approach gives real perspective on what counts as sunk cost, and where capital should shift once market dynamics or ROI assumptions change. Not every [KPI](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) needs to be financial either. A friend of mine worked on a market entry project where the team measured dollar share every quarter, so by the time the quarter closed, it was already too late to know whether capital had gone toward the wrong things. A better proxy, tracked through third-party data on customers won versus competitors, would have shown direction much sooner. That kind of metric is hard for finance to embrace since it isn't a balance sheet figure, but these shifts are becoming essential as the pace of change accelerates. ## **Shared responsibility going forward** This is a shift both functions need to make, not just FP&A. Finance can move toward directional thinking, trading some accuracy for faster feedback and quicker resource pivots. Strategy, in turn, needs to bring FP&A in earlier and validate ambition before ideas reach an executive committee, rather than treating finance as the team that bursts the bubble later. I'm increasingly seeing companies put the CFO directly at the head of the strategy organization, as I understand Hershey has done. Where that isn't the structure, the alternative is a dedicated node within FP&A, close to fully staffed, for strategy projects specifically. That's the model I've built toward in my own organization. I'd also push back on the idea that strategy still lives in the clouds while FP&A lives in day-to-day operations. That may have been fair ten years ago, when a strategy team could hand over a ten-year, billion-dollar ambition on a slide deck and call the job done. That era is over. Strategy today is deeply embedded in commercial execution, and compensation increasingly reflects that rather than the quality of a deck. FP&A has shifted the same way, moving from pure reporting toward a genuine decision-making partner, particularly on projects like market entry or growth transformation, where it carries far more ownership than it did a decade ago. That shift, more than any single tool, is what will determine whether the two functions finally speak the same language. --- **This article is based on Noufal's brilliant talk at our FP&A Summit Austin. Check out our** [**upcoming events**](https://www.financealliance.io/events/) **and come learn from top finance leaders.** ### The fully automated month-end close URL: https://www.financealliance.io/inside-quizlets-agentic-close/ Last updated: 2026-08-27T12:13:13.000Z Every finance team has been pitched AI for the close. Most haven't adopted it, and the reason is the same each time: the AI drafts, then stops. It can't reach every system, so the manual work stays where it was and the business case falls apart. Quizlet's team got past that. Their close runs on "AI staff accountants": agents that log into NetSuite and the systems around it and operate them the way a person would. No integration work. The agents reconcile, post, and leave a full audit trail behind every action. Join **Quizlet's VP Controller, Eveline Kartawidjaya**, and **Zalos CEO, Will Fairbairn**, for a live walkthrough of an actual month-end: the agents doing the work, and what changed for Eveline's team. ## What you'll walk away with - See how an AI agent operates finance systems the same way a human accountant does, without an integration project behind it - Understand what enterprise-grade auditability looks like when an agent, not a person, made the entry - Learn why agent-driven processes can carry tighter controls than the manual ones they replace - Watch high-volume revenue and bank reconciliations run end to end - Take away a realistic view of what to automate first, from a controller who has already done it ## Meet the speakers [**Eveline Kartawidjaya**](https://www.linkedin.com/in/eveline-kartawidjaya-1274815/)**, VP Controller, Quizlet** Eveline owns accounting operations and the month-end close at Quizlet. Before that she was VP Finance Controller at Madison Reed, where she built and ran the controllership function through the company's growth. Her career has been spent leading close, reconciliation, and controls for large, high-growth technology businesses. [**Will Fairbairn**](https://www.linkedin.com/in/willfairbairn/)**, Co-founder and CEO, Zalos** Will co-founded Zalos, which builds AI agents for CFOs working across fragmented finance systems. Zalos agents log into the ERP and surrounding finance tools and operate them like a human accountant would. Before Zalos he was on the leadership team at Agicap, a treasury management unicorn, and prior to that a Senior Engagement Manager at McKinsey, where he worked with CFOs across technology companies. ### AI handles the output, finance owns the story: Unlocking creativity in data storytelling URL: https://www.financealliance.io/unlocking-creativity-in-data-storytelling/ Last updated: 2026-07-24T15:00:01.000Z A few months ago, [I spoke about building AI products in finance](https://www.financealliance.io/building-ai-products-in-finance-the-intersection-of-data-product-thinking-and-ai/), walking through how teams can move from manual work to more automated, [AI-powered](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) workflows. To make that shift concrete, I introduced a hypothetical character, Jane, and traced her path from drowning in manual work to something I called Jane 2.0: a version of herself equipped with real AI products and a more automated way of working. That earlier conversation solved one problem but it also created a new one. Once Jane had the time back, her manager asked the obvious next question: now that you've built a good strategy around AI products, reusable not just for you but for the broader organization, how do you intend to spend the extra time you have? That question is the real subject of this piece. AI is going to keep automating and improving the mundane parts of finance work. The interesting question is what we do with the time it returns to us, and I'd argue the answer is [storytelling](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/). What follows is a look at what I call the sameness problem, why finance needs to move from producing reports to owning a narrative, a simple framework for making that shift, a few real scenarios that illustrate it, and where Jane's evolution goes next, from 2.0 to what I'm calling Jane 3.0. [Rethinking finance teams for the age of AIWhen AI is implemented thoughtfully, finance can become one of the most strategically valuable functions inside the organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-f5d2a755-bf30-4f3e-808e-36ffba090e1d.png)Finance AllianceKate Motonaga![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--30--5867beec-ff70-4b8c-afd7-40f8b73760fc.png)](https://www.financealliance.io/rethinking-finance-teams-for-the-age-of-ai/) ## **Where Jane started** Not long ago, Jane was the star of her team and drowning in manual work. She spent hours stitching together datasets from multiple sources, relying on her own manual thinking because the systems around her weren't built to help. She was building reports from scratch, running scattered AI pilots, and functioning as a data plumber rather than the strategic partner she was capable of being. The fix was an operating model shift: building actual AI products so Jane could move into the strategist role she was meant to occupy. She made that leap. But the moment she had time back, the conversation shifted from how she works to what she's actually contributing. That's the gap this piece is trying to close. [How generative AI is transforming financeFinancial advisors could use AI to generate initial investment recommendations while focusing their expertise on understanding client needs and providing personalized guidance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-a2899a32-b223-4097-b803-c92b951d899f.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--9--d1f8dc2d-a902-4808-b96e-20baf4f7742d.png)](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) ## **The sameness problem** The new risk in this AI era isn't a bad output. Models keep improving, and the pace of that improvement means most teams can now produce a polished deck, clean commentary, and structured analysis without much friction. Efficiency has genuinely improved, hours of work condensed into minutes. But the real question isn't whether the output is good. It's whether it's impactful, or simply forgettable. That's the sameness problem. I ran into this myself recently, when I was asked to share some insights and the response I got back was, essentially, that this kind of output had already been seen multiple times. That response captures the shift well. The differentiator is no longer how well you can curate an output. It's what story you're trying to tell with it. AI raises the floor for everyone; judgment becomes the ceiling. The teams that win are the ones who frame the question differently, challenge the [narrative](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/), and drive the decision. AI is very good at standardizing output. The risk is letting it standardize thinking as well. [How I’m thinking about AI after 27 years in financeAfter 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-b4509dc8-fc6a-44c1-a049-6c02afe3189d.png)Finance AllianceGeeta Malhotra![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--028e1364-4c19-4dcd-9881-a5d590636bee.png)](https://www.financealliance.io/ai-in-finance-business-strategy/) ## **Four shifts finance needs to make** Report creator, variance describer, output polisher, data summarizer: these labels have described finance and [FP&A roles](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) for a long time, and they need to give way to something different. AI should absolutely keep automating the underlying work behind each of these, but the role itself has to shift. Report creator becomes story owner. Explaining why the numbers moved is no longer the job on its own; translating that movement into real [business impact](https://www.financealliance.io/why-most-finance-professionals-feel-underpaid/) and building the narrative around it is. Variance describer becomes insight framer. Describing what changed matters less than framing what that change means for a decision that has to get made. Output polisher becomes outcome shaper. Good commentary is table stakes. Shaping the outcome a team is trying to drive, and figuring out what narrative gets there, is the actual work. Data summarizer becomes decision driver. Presenting what the data shows isn't enough on its own; the job is driving the decision that the data points toward. Getting good data and curating clean reports used to be the real constraints in this job. AI has largely closed that gap. What remains as the genuine differentiator is the story built on top of it. _This post is for paying subscribers only._ ### Why ‘black box’ AI is failing FP&A and what to use instead URL: https://www.financealliance.io/why-black-box-ai-is-failing-fp-a-and-what-to-use-instead/ Last updated: 2026-07-28T09:14:13.000Z Over the past decade, we’ve watched [artificial intelligence](https://www.financealliance.io/ai-in-fp-a/) seep into every corner of our professional lives. But something feels different now. The buzz isn’t just about potential anymore, it’s about impact. When ChatGPT reached 100 million users in just two months, it was a wake-up call that we’re in a new era of [productivity](https://www.financealliance.io/operationalizing-productivity-in-a-1b-construction-vertical/) and innovation. At the intersection of finance and technology, a transformation is underway, and [financial planning and analysis](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) (FP&A) professionals are uniquely positioned to lead it. I want to share what I’ve learned about how we can leverage AI in financial forecasting, so in this article, I’ll cover: - [Understanding AI and it’s role in FP&A](https://www.financealliance.io/p/81a99c50-22f3-4182-b0ec-22582845ba19/?member%5Fstatus=paid#%3Cstrong%3Eunderstanding-the-role-of-ai-in-fp&a%3C/strong%3E) - [How AI is impacting FP&A](https://www.financealliance.io/p/81a99c50-22f3-4182-b0ec-22582845ba19/?member%5Fstatus=paid#%3Cstrong%3Ehow-ai-works-in-fp&a%3C/strong%3E) - [AI algorithms to use](https://www.financealliance.io/p/81a99c50-22f3-4182-b0ec-22582845ba19/?member%5Fstatus=paid#%3Cstrong%3Eai-algorithms-you-can-use%3C/strong%3E) - [Practical AI: From data to forecast](https://www.financealliance.io/p/81a99c50-22f3-4182-b0ec-22582845ba19/?member%5Fstatus=paid#%3Cstrong%3Epractical-ai:-from-data-to-forecast%3C/strong%3E) - [Explainable AI ](https://www.financealliance.io/p/81a99c50-22f3-4182-b0ec-22582845ba19/?member%5Fstatus=paid#%3Cstrong%3Ethe-shift-toward-explainable-ai%3C/strong%3E)(moving away from 'black box' AI) - [AI tools for forecasting](https://www.financealliance.io/p/81a99c50-22f3-4182-b0ec-22582845ba19/?member%5Fstatus=paid#%3Cstrong%3Eai-tools-for-forecasting%3C/strong%3E) - [How to prepare for AI and ML in FP&A ](https://www.financealliance.io/p/81a99c50-22f3-4182-b0ec-22582845ba19/?member%5Fstatus=paid#%3Cstrong%3Ehow-to-prepare-for-ai-and-ml-in-fp&a%3C/strong%3E) ## **Understanding the role of AI in FP&A** ![the age of AI](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/05/Screenshot-2025-05-29-at-09.20.21.png) Let’s take a step back. What exactly is [artificial intelligence](https://www.financealliance.io/ai-in-finance-business-strategy/)? At its core, AI is the science of creating machines that can perform tasks that normally require human intelligence. In finance, AI is used in three main ways: - Data-driven decision making - Automation and efficiency - Predictive analytics ![what is AI?](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/05/Screenshot-2025-05-29-at-09.20.46.png) In FP&A specifically, AI offers a wide range of [opportunities](https://www.financealliance.io/fp-a-exit-opportunities/). I like to categorize its use into three pillars: - Simplifying complexity - Generating new knowledge - Saving time Let’s unpack these a bit more. ![When to use AI in FP&A](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/05/Screenshot-2025-05-29-at-09.21.04.png) ### **1\. Simplifying complexity** AI tools like ChatGPT, [Microsoft Copilot](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/), and Google Bard/Gemini have made it easier than ever to demystify financial concepts. Imagine asking a chatbot to explain IFRS 10 to your marketing manager, and getting an answer that makes sense. AI-powered reporting is another major benefit. It consolidates your financials and provides real-time [reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) capabilities. You can even build your customized version of GPT, embedded with your company’s internal policies so that it becomes an expert in your context. ### **2\. Generating new knowledge** This is where [financial forecasting](https://www.financealliance.io/how-ai-forecasting-drives-smarter-financial-planning/) comes into play. AI allows us to go beyond basic reporting into predictive and prescriptive analytics. It not only tells us what might happen (predictive) but also what we should do about it (prescriptive). AI can help identify patterns, uncover hidden trends, and generate insights. Beyond forecasting, AI can be used for clustering, predictive [insights](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/), and scenario planning. ### **3\. Saving time** AI can automate tedious tasks like file merging and data consolidation, freeing up FP&A teams to focus on strategic initiatives. I often tell my clients: "Let the bots crunch the numbers, so you can focus on the business." [FP&A: The key to unlocking a company’s financial potentialIn this article, we’ll explore the importance of FP&A and how it can be used to drive business growth and success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-133.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--6--2-1.png)](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) ## **How AI works in FP&A** To grasp AI's potential in [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), it's important to understand the four stages of data analytics: ### **Descriptive analytics: What happened?** Descriptive Analytics focuses on summarizing and interpreting historical data. It answers questions about what occurred in the past, such as sales trends customer behavior, patterns, and [financial performance](https://www.financealliance.io/why-cfos-need-to-be-people-managers/) over time. ### **Diagnostic analytics: Why did it happen?** Diagnostic Analytics digs deeper into data to understand the causes behind observed events. It shares insights on the reasons for past performance or trends, such as why sales dropped in a particular quarter or why a marketing campaign was successful. ### **Predictive analytics: What could happen?** Predictive Analytics uses statistical models and forecast techniques to make educated guesses about future events. It reveals what might happen next based on patterns and trends identified in historical data, such as predicting future sales growth or market trends. ### **Prescriptive analytics: How can we make it happen?** Prescriptive Analytics goes beyond predicting future outcomes by suggesting actions and strategies to benefit from these predictions. It answers questions about the best course of action, such as what strategies should be implemented to increase market share or how to optimize resource allocation for maximum efficiency. Forecasting falls into the predictive analytics bucket, but its real power is unlocked when combined with prescriptive insights. [The £7.5 million lesson: What real FP&A influence looks likeHow do you close the FP&A influence gap? You clarify, challenge, and connect so that finance moves from being reactive to being influential.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-06abfd2f-57ff-4c40-a743-0cf3d2116d05.png)Finance AllianceAlexander Roche![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--19--314a13ba-1653-4a45-85f9-3a9bcbeed237.png)](https://www.financealliance.io/what-real-fp-a-influence-looks-like/) ## **AI algorithms you can use** Various algorithms can support financial [forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/). Here’s a quick rundown: - Intuitive Forecasting (Human judgment) - Run Rate Analysis (Using historical trends to project future performance) - Linear/Logarithmic Regression (Modeling relationships between variables) - Time Series Models (ARIMA, SARIMA) - Machine Learning Models (Random Forest, Neural Networks) - Prophet (Developed by Meta for seasonal time-series forecasting) I personally find Prophet to be highly effective for datasets with strong seasonality patterns. ## **Practical AI: From data to forecast** There are three main stages in financial forecasting where AI plays a role. The first is [data collection](https://www.financealliance.io/data-cleaning-techniques/) and consolidation. [FP&A teams](https://www.financealliance.io/fp-a-team-structure/) spend a massive chunk of time gathering data from different departments. AI and automation tools can reduce this effort by up to 60%. Imagine pressing a button and having all your data consolidated and cleaned in minutes. With data ready, the next step is building forecasts. Using AI models, you can generate more accurate predictions. Better yet, AI allows you to test different assumptions and scenarios quickly. Finally, forecast optimization is where explainable AI becomes crucial. Rather than being a black box, explainable AI allows users to see why a forecast is what it is. You can understand the key drivers and make informed decisions. ## **The shift toward explainable AI** ![explainable AI](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/05/Screenshot-2025-05-29-at-10.30.02.png) One of the biggest barriers to adopting AI in FP&A is trust. Traditional AI models often operate like black boxes: you feed in data and get an answer, but you don't know how the system arrived at that answer. Explainable AI, or "glass box" AI, changes the game. It offers transparency by providing the reasons *behind* its predictions. This makes it easier for FP&A professionals and stakeholders to understand, evaluate, and trust model recommendations. So, what does that look like? ![Improving forecasts with AI](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/05/Screenshot-2025-05-29-at-10.30.49.png) Well, with the black box approach, we begin with traditional data and the model will start learning from that training data. The key output will be a decision or recommendation. Now the problem with this is that the only output is that learned function and that decision without actually explaining the drivers or the root causes of that forecast. It's very similar to if you need to create a [sales forecast](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/). You just say that the number of sales that you are going to sell the next year is going to be one million units and then you stop there. You don't say anything else. With that, the actual humans consuming those models will have a lot of questions. Like, why did AI do that? Why not something else? How should we interpret those results? And even more importantly, how do we trust that model? With the second example, we have a different approach: the Glassbox AI approach. We still have the training data, but then we have this explainable AI and machine learning algorithm. With that, the key output is not just the decision or recommendation, but also an explainable model. So something for the actual human to understand why the sales forecast was one million, why not two million, or why not 500,000. With this approach, the [humans](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) in FP&A can actually interpret and improve that forecast. Most importantly, they can trust that forecast. Glass-box AI enables: - Transparency - Auditability - Trust in model outputs ## **AI tools for forecasting** I get asked all the time, "Which [tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/) should I be using?" Here’s a quick guide to some of the most useful ones for financial forecasting: - **Microsoft Copilot Pro:** Integrated with Excel, Power BI, and Fabric. You can generate reports, analyze trends, and ask financial questions using natural language. - **Azure:** Offers robust cloud-based AI capabilities for scalable models. - **Power BI:** Leverage Copilot in Power BI for dynamic, interactive dashboards. - **Excel + Python:** With Python integration in Excel (rolling out now), you can run models like Prophet or ARIMA directly in your spreadsheets. - **Google Colab:** Great for building and running Python-based models in a browser-based environment. I often teach a four-step process for using ChatGPT for forecasting: ![Prompt steps](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/05/Screenshot-2025-05-29-at-10.53.29-1.png) ## **How to prepare for AI and ML in FP&A** To stay competitive, finance teams need to prepare. Here are five steps I recommend: ### **1\. Data quality and integration** Data is the lifeblood of AI and ML. Organizations must ensure data quality, consistency, and integration across various sources. This includes cleaning and structuring data to make it machine-readable. ### **2\. Talent acquisition and training** Hiring data scientists, analysts, and AI/ML experts is essential. Training existing FP&A teams in AI and ML techniques can also bridge the skills gap and empower them to leverage these technologies effectively. ### **3\. Selecting the right tools** Choosing the right AI and ML tools and platforms that align with FP&A goals is crucial. Options range from predictive analytics software to AI-driven financial planning platforms. ### **4\. Change management** The integration of AI and ML will bring organizational change. It’s important to communicate the benefits and challenges to all stakeholders and facilitate a smooth transition. ### **5\. Continuous learning** AI and ML are ever-evolving fields. Continuous learning and staying updated on the latest advancements are essential to maximize their potential in FP&A. ## **Attend one of our finance summits to learn more about AI in finance** Join our global summit series in a city near you to discover how to unleash the full strategic potential of your finance function. Get in a room with industry leaders as they share best practices and common challenges to help you build the skills you need to increase accuracy and predictability, integrate AI effectively, and foster a high-performing team. [Find an event near you](https://events.financealliance.io/) ### Where AI fails and how to protect your bottom line URL: https://www.financealliance.io/where-ai-fails-on-benefits-spend-and-how-to-protect-your-bottom-line/ Last updated: 2026-08-25T07:53:23.000Z Most finance and HR leaders know they're overspending on benefits. What they can't do is prove where, or by how much. Somewhere in your claims data is an employee whose primary care doctor keeps sending them to the most expensive specialists in network, not necessarily the best ones. Nobody chose that on purpose, and nobody's watching for it. In this live demo, we'll trace one employee's care back to the doctor making the referral calls, see where that doctor sends people, and determine whether it's a good deal. Then we'll show how that exact referral pattern adds up across every employee that doctor treats. Live Q&A space is limited to ensure we can take attendee questions. --- ## What we'll cover live - **Trace the referral trail:** see how one employee's care traces directly back to the doctor making the referral calls. - **Compare real destinations:** view cost and quality side by side across actual referral destinations, not high-level averages. - **See the real savings:** steering members toward providers priced near the average, instead of renegotiating rates, saved 30% to 46% on a given service in the New Jersey data we've reviewed. - **Answer your plan questions:** bring your toughest question about your plan. We'll answer it live against real, de-identified data. --- ## Sound familiar? - *"We know we're overspending. We just can't prove where."* **Carrier and TPA reports show what you spent, not why, or whether the referral pattern behind it was any good.** - *"Our claims data is too messy for the tools we already have, including the AI."* **Generic AI stalls on raw plan data like this. We built ours to handle it.** - *"I've asked my broker a specific question about our plan and gotten nothing useful back."* **Brokers can only answer what the data lets them see. Prepared right, it answers a lot more.** - *"We're not sure we're meeting our fiduciary duty here."* **Under ERISA, "we didn't know" isn't a legal defense. This session gives you somewhere to start.** **Can't make it live?** Register anyway to get OnDemand access to the full recording and data breakdown delivered to your inbox. --- ## Meet the speakers **Justin Magnan |** *President & Co-Founder, Andovia* Justin has spent nearly two decades helping self-insured employers turn healthcare data into a financial advantage. He works directly with CFOs and benefits leaders, translating raw claims data into the cost and risk intelligence needed to make better decisions before renewal, not after. [**David Magnan**](https://www.linkedin.com/in/david-magnan-81b9356b/) *| Technology Executive & Business Leader* David is a technology executive with over 50 years of leadership experience across sales, marketing, customer service, software R&D, and large-scale operations. --- ## Reserve your seat See what happens when you stop looking at claims as high-level totals and start following the money. ***Live Q&A space is limited to ensure we can take attendee questions.*** Reserve Your Seat × ### The variance analysis cycle: Steps, formulas & tips URL: https://www.financealliance.io/the-variance-analysis-cycle/ Last updated: 2026-07-16T10:37:05.000Z ## **What is the variance analysis cycle?** The variance analysis cycle is a structured process of comparing actual results against planned figures to understand why [financial performance](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/) didn't match expectations. Imagine you built a budget for materials, labor, and overhead, then costs started climbing halfway through the period. The variance analysis cycle helps you pinpoint what changed. Maybe supplier prices increased. Maybe productivity slipped. Maybe an unexpected event affected operations. By working through the cycle, you can: - **Spot performance issues early:** Identify whether a variance comes from pricing, volume, efficiency, or external factors. - **Make better decisions:** Use the insight to improve [budget allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) and sharpen your [forecasting and planning processes](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/). - **Improve future performance:** Apply what you learn to strengthen your planning process over time. ## **What are the steps in the variance analysis cycle?** The variance analysis cycle is a framework for understanding *why* your financial results might differ from what you originally planned. Here are the key steps to follow: ![The Variance Analysis Cycle ](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/variance-analysis-cycle-image.png) **The Variance Analysis Cycle (simplified)* ### **1\. Prepare performance report** Document everything in a clear [performance report](https://www.financealliance.io/flexible-budget-performance-report/). This includes: - Any variances you found - Why you think they happened - What steps you took to address them - The results of those actions By doing this, you'll create a baseline for **identifying and quantifying** any variances. Your performance report serves as valuable documentation and helps guide future decision-making. ### **2\. Analyze variances** Once the performance report is prepared, the differences between the actual results and budgeted values are calculated. This analysis helps [identify potential areas of concern and efficiency](https://www.financealliance.io/business-process-optimization/). ### **3\. Raise important questions** Next, compare your budget or forecasts to your actual results. Where do you see differences? Don't just note the numbers, start asking questions: - *Why are our expenses higher than we thought?* - *Did something cause our sales to fall short?* - *Are there unexpected factors dragging down our profits?* [Cost-benefit analysis: 5 steps to turn data into smarter choicesIf you want to learn more about what cost-benefit analysis is and how to do it, keep reading as we dive into five key steps to streamline your financial evaluations and drive smarter decisions. 🧠![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-0118779f-0f62-4c11-88a5-b31572ad9d85.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--6--5fc26091-d9ab-4d59-a032-4405388b59dc.png)](https://www.financealliance.io/cost-benefit-analysis/) ### **4\. Identify the causes** Once you have a list of questions, it's time to dig deeper and identify the root causes of the variances. This involves gathering data, [analyzing trends](https://www.financealliance.io/cfo-trends-2024/), and conducting various 'investigations'.🕵🏼‍♂️ You might need to: - **Review historical data** to identify patterns and trends. - **Consult with operational teams** to understand specific challenges and inefficiencies. - **Analyze market data** to identify external factors influencing performance. ### **5\. Take corrective actions** Based on your findings, it's crucial to take action to address the identified variances. Possible actions resulting from the variance analysis cycle may involve: - **Implementing** **corrective measures** to improve efficiency, [reduce costs](https://www.financealliance.io/5-cost-reduction-strategies/), or boost sales. - **Reallocating resources** to capitalize on opportunities or [mitigate risks](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/). - **Revising budgets** and forecasts to reflect new realities and insights. ### **6\. Conduct operations for the next period** By the time you've reached this step, you've got enough knowledge to tackle the next period's operations with a more informed approach. Think about applying what you learned to help set more achievable targets, allocate resources better, and implement proactive measures to prevent future variances. Remember, the variance analysis cycle is about continuous improvement. By asking the right questions, finding the root causes of differences, and taking appropriate action, you can make your [financial planning](https://www.financealliance.io/the-financial-planning-analysis-chasm/) and performance better over time. Remember, the variance analysis cycle is about continuous improvement. By asking the right questions, finding the root causes of differences, and taking appropriate action, you can make your [financial planning](https://www.financealliance.io/the-financial-planning-analysis-chasm/) and performance better over time. ## **The formula *behind* the analysis** The variance analysis cycle relies on a specific formula to quantify the difference between budgeted and actual results. Let's break down the formula itself, how to use it in [Excel](https://www.financealliance.io/chatgpt-for-excel/), and explore specific variations… ### **What is the formula for variance analysis?** The core formula for variance analysis calculates the **difference** between the **budgeted** (or **planned**) value (B) and the **actual** value (A): > **Variance = Actual (A) - Budgeted (B)** This straightforward formula provides a basic understanding of how much your results deviated from your expectations. However, for a deeper analysis, we need to consider different types of variances, leading to more specific formulas. ### **What is the formula for variance analysis in Excel?** Excel offers various built-in functions to calculate variances depending on what you're analyzing and whether you're dealing with the entire population or a sample: **Population variance:** Use the VAR.P (range) function, where "range" refers to the cells containing your data. **Sample variance:** Use the VAR.S (range) function. **Price variance:** This calculates the difference between the actual price paid (AP) and the budgeted price (BP) multiplied by the actual quantity (Q): > **Price Variance = (AP - BP) \* Q** **Quantity variance:** This calculates the difference between the actual quantity (Q) and the budgeted quantity (BQ) multiplied by the budgeted price (BP): > **Quantity Variance = (Q - BQ) \* BP** [When insight stalls: Closing the gap between analysis and executive actionCaroline shares a practical diagnostic for where decision cycles stall, and the operating moves high-performing CFO organizations use to restore speed without sacrificing rigor.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-11be9167-28de-411c-907a-252c017cecbe.png)Finance AllianceCaroline McAuliffe![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--32--de487abf-2e53-4bfb-ae15-9e3e77dee92e.png)](https://www.financealliance.io/closing-the-gap-between-analysis-and-executive-action/) ## **Variance analysis by time period** Variance analysis becomes more useful when you choose the right comparison period. Different time frames highlight different types of performance changes. ### **Month-over-month (MoM)** Month-over-month analysis compares one month to the previous month. It helps you catch short-term shifts like seasonality, sudden cost increases, or the early impact of a pricing or staffing change. ### **Quarter-over-quarter (QoQ)** Quarter-over-quarter analysis smooths out monthly noise and gives you a clearer view of sustained trends. It's especially useful for [leadership reporting and broader performance reviews](https://www.financealliance.io/financial-leadership-in-changing-times-2/). ### **Year-to-date (YTD) vs forecast** A YTD comparison shows how cumulative actual results stack up against your forecast so far. This helps you assess whether you're on track to hit annual goals or need to revise expectations. ### **Actual vs rolling forecast** [Rolling forecasts update as new information](https://www.financealliance.io/rolling-forecast-best-practices/) becomes available. Comparing actuals to a rolling forecast gives you a more realistic benchmark than relying only on a static annual plan. ## **Types of variance analysis** The variance analysis cycle dives deeper by focusing on specific areas within your budget. This lets you pinpoint the root causes of variances much better. Below, we'll explore three common types of variance analysis: material, labor, and overhead variances. ### **1\. Material variance analysis** This focuses on understanding the difference between the actual cost of materials used (ACM) and the budgeted cost of materials (BCM) for the actual quantity (Q) used: > **Material Variance = (ACM - BCM) \* Q** This variance can be further broken down into **price variance** (difference between actual and budgeted price per unit) and **quantity variance** (difference between actual and budgeted quantity used). ### **2\. Labor variance analysis** This examines the difference between the actual cost of labor (ACL) and the budgeted cost of labor (BCL) for the actual hours worked (AH): > **Labor Variance = (ACL - BCL) \* AH** Like material variance, this can be further analyzed as **labor rate variance** (*difference between actual and budgeted hourly wage*) and **labor efficiency variance** (*difference between actual and budgeted hours worked for a given output*). ### **3\. Overhead variance analysis** This analyzes the difference between the actual overhead cost (AOC) and the budgeted overhead cost (BOC): > **Overhead Variance = (AOC - BOC)** Overhead costs are indirect and often fixed within a specific time period. Therefore, this variance can be further categorized as **fixed overhead spending variance** (difference between actual and budgeted fixed overhead cost) and **variable overhead spending variance** (difference between actual and budgeted variable overhead cost per unit of activity). [Navigating uncertainty: Why agile FP&A is your competitive edgeMaster change with agile FP&A. Turn uncertainty into opportunity through flexible forecasting, data-driven decisions, and smarter collaboration.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-020a7d4d-7924-4cf2-842f-7aa6add3d535.png)Finance AllianceImane Haouassia![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--33--0d28501a-e95f-45d3-9546-74bda370c082.png)](https://www.financealliance.io/navigating-uncertainty-why-agile-fp-a-is-your-competitive-edge/) ## **How to calculate spending variance** **Spending variance** refers to the difference between the actual amount you spent and the amount you budgeted to spend. To calculate spending variance, you can use this formula: > **Spending Variance = Actual Spending - Budgeted Spending** Let's say you planned to spend $500 on marketing for the month. However, due to unforeseen circumstances, your actual spending reached $620\. Plugging these values into the formula, we get: > **Spending Variance = $620 (Actual) - $500 (Budgeted) = $120** In this case, the positive variance of $120 indicates that you overshot your budget by $120\. This could be a cause for concern, prompting you to investigate further and take corrective actions. Remember, variances can be favorable or unfavorable depending on the situation and your goals. By calculating and understanding spending variances, you gain valuable insights into your spending patterns and can [make informed decisions to optimize](https://www.financealliance.io/cost-benefit-analysis/) your financial health. Clarification of standard cost variance and budget variance analysis: it's important to note that standard cost variance analysis and budget variance analysis are sometimes used interchangeably, but they can have subtle differences. ### **What is budget variance analysis?** [Budget variance](https://www.financealliance.io/budget-vs-actual-variance-analysis/) analysis compares **actual results** to the **original budget**. It's a broader approach that doesn't necessarily consider standard costs and can be used for various expense categories, including materials, labor, and overheads. ### **What is the standard cost variance analysis?** Standard cost variance analysis compares **actual results** to **predefined standard costs**. Standard costs are predetermined estimates of what a cost should be under normal operating conditions. This approach allows for a more detailed understanding of cost variances beyond simply comparing actuals to the budget. ## **Is variance positive or negative?** Variance itself isn't inherently positive or negative. It's simply the **difference** between what you expected (budgeted) and what actually happened. It's like the gap between your planned destination and the actual road you end up taking. However, the context of the variance matters more: If the **actual cost** comes in **under budget** (positive variance), that's a good thing. But, if the **actual cost** is \*\*\*higher\* than expected\*\* (negative variance), that means you went over budget. This might not be ideal, but it helps you understand where you might need to adjust your spending in the future. So, while the variance itself doesn't have a positive or negative sign, understanding the "why" behind the variance helps you determine if it's an opportunity to celebrate or a cause for further [analysis](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/) and potential adjustments. ### **Can variance be zero?** Yes, a variance *can* be zero! This occurs when the actual results perfectly match the budgeted or planned figures. In simpler terms, it means everything went *exactly* according to plan, with no surprises (either positive or negative) in terms of costs, revenues, or other [financial metrics](https://www.financealliance.io/infographic-financial-performance-metrics/). [6 zero-based budgeting myths debunkedA zero-based budget (ZBB) is a budgeting method where you allocate every dollar earned to a specific category or expense. You start with a blank slate - zero - each time you budget, rather than tweaking your past budget.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-cfb5a8fe-4b51-449b-ba3e-cf005a19a9bb.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--30--af255729-f738-40ef-a8c9-e686a7b3ce78.png)](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/) ## **What causes an unfavorable variance?** An unfavorable variance happens when actual results fall short of expectations. That usually means costs were higher than planned, revenue was lower than expected, or both at the same time. The next step is to identify the root cause. In most cases, unfavorable variances come from a small set of common drivers: - **Market fluctuations:** Input prices, customer demand, or currency conditions changed unexpectedly. - **Operational inefficiencies:** [Delays, waste, rework, or poor resource allocation](https://www.financealliance.io/17-finance-business-processes/) increased costs or reduced output. - **Pricing pressure:** You had to discount more than planned or couldn't raise prices as expected. - **External events:** Regulatory changes, supply chain disruptions, or other outside shocks affected performance. - **Human error:** Mistakes in forecasting, budgeting, data entry, or execution created a gap between plan and reality. Not every unfavorable variance signals a deeper problem, but each one should be investigated in context. A small overspend in one area may be manageable, while a recurring pattern can point to a broader planning or operational issue. ### **Are unfavorable variances always bad?** While unfavorable variances are generally unwelcome surprises, they're not always a bad thing. Think of them as valuable wake-up calls, prompting deeper analysis of inefficiencies and corrective actions that ultimately lead to improved performance and future [cost-saving opportunities](https://www.financealliance.io/5-cost-reduction-strategies/). The key is to view them as stepping stones toward ongoing [financial optimization](https://www.financealliance.io/optimizing-your-financial-strategy-to-account-for-downturns-and-esg-factors/). ### **How to tell if variance is favorable or unfavorable** Imagine you budgeted to spend $100 on office supplies for the month, but only ended up spending $83\. This **favorable variance** means you spent $17 less than expected, saving some precious cash. However, the *opposite* scenario can also occur. If you budgeted $100 but ended up spending $123, you have an **unfavorable variance**. You overshot your budget by $23, a potential cause for concern. Here's how you can tell if the variance is favorable or unfavorable: - **Favorable variance:** Actual results are **better** than the budget (e.g., spending *less* than expected). - **Unfavorable variance:** Actual results are **worse** than the budget (e.g., spending *more* than expected). ## **How to write a variance analysis report** Variance analysis reports are important for understanding why your financial results might differ from your plans. But how do you write a report that's clear, informative, and engaging? [What is a compliance report: A guide on compliance reportingA clear, no-fluff guide to compliance reporting for finance teams who do it all.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-b6047a73-4f5a-4e56-8d8c-6c7ffb5a8692.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/compliance-report-blog-meta-2-ab264b59-e876-4852-97f3-db72f9043939.png)](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) Here are some tips to help you write a variance analysis report: ### **Structure:** **1\. Start with a strong introduction:** Briefly introduce the report, stating the period analyzed and the key variances investigated. **2\. Findings (show, don't just tell):** Present the identified variances in a clear and concise format, like [tables or charts](https://www.financealliance.io/financial-charts-and-graphs/). Include explanations for each significant variance, using clear and non-technical language. **3\. Analysis:** Dig deeper into the "why" behind the variances. Explain the root causes, using data, examples, or insights from discussions with relevant teams. **4\. Action plan:** Based on your analysis, propose specific actions to address the variances. This might involve cost-saving measures, pricing adjustments, or process improvements. Be clear about who is responsible for implementing each action item. **5\. Wrap it up:** Summarize your key findings and reiterate the impact of the variances on the organization's financial performance. Briefly mention any recommendations for future planning or process improvement. ### **Key components:** - **Clarity is king:** Use simple language, avoid technical terms, and [explain any necessary jargon](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/). - **Visual appeal:** Use charts, graphs, or tables to present complex data efficiently and visually. - **Actionable insights:** Don't just present the problems; provide concrete solutions and recommendations. - **Keep it concise:** Aim for a focused report, avoiding unnecessary details or fluff. By following these tips, you can create a powerful variance analysis report that informs and empowers your colleagues to make data-driven decisions. --- ## **FAQs: The variance analysis cycle** ### **What is the variance analysis cycle?** The variance analysis cycle is a continuous process of comparing actual results to planned figures, analyzing the differences (variances), identifying root causes, and taking corrective actions to improve future performance. ### **How are variances investigated and resolved?** To investigate and resolve variances, you'd gather relevant data, analyze trends, consult with stakeholders from different departments to gain insights, identify the underlying reasons behind the variances, and develop and implement corrective actions like cost-saving measures, pricing adjustments, or process improvements. ### **What is the root cause of variance analysis?** The root cause of variance analysis isn't about finding blame, but rather about understanding why actual results differ from planned figures. This knowledge helps prevent similar issues and improve financial planning and decision-making. ### **What is unfavorable variance?** Unfavorable variance occurs when the actual results fall short of expectations compared to the planned figures, such as experiencing higher costs, lower sales, or lower efficiency levels. ### **Why do we need a variance analysis?** Variance analysis helps us understand why financial results differ from plans, identify areas for improvement within the organization, and make informed decisions about future plans, resource allocation, and adjustments to strategies. ### **What are the disadvantages of variance analysis?** While time-consuming and requiring skilled personnel to interpret data and take effective actions, variance analysis is crucial because it helps us understand and address the root causes of discrepancies, ultimately leading to better financial performance. ### **Why do variances occur?** Variances can stem from various factors, both internal (operational inefficiencies) and external (market fluctuations), and even human error. ### **How can variances be corrected?** Correcting variances depends on the identified root cause, but might involve implementing cost-cutting measures, adjusting pricing strategies, improving internal processes, or revising future plans and budgets. ## **Ready to master FP&A?** Variance analysis is just one piece of the FP&A puzzle. If you're serious about sharpening your forecasting, budgeting, and financial storytelling skills, **FP&A Certified: Core** is built for you. Learn how to build accurate forecasts, turn complex data into strategic insights, and step into the role of a true business partner, all backed by industry experts from companies like Adobe, Philips, and Kyruus Health. 👉 [**Accelerate your career with FP&A Certified: Core**](https://certified.thealliance.io/course/fpa-certified-core) and gain the tools, templates, and know-how to drive real business impact. [Finance Alliance Pro+ membershipBe one of the first to join Finance Alliance’s membership where you can access world-class finance resources and the all-in-one platform for networking and career advancement.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-aa0b1a3b-0f9d-485f-8299-10218810df73.png)Finance AllianceDev Team![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Membership_Meta_Images_-1-ca069a7c-edbe-4022-afe4-5e9d2d2d9c89.png)](https://www.financealliance.io/pro-plus-membership/) ### How today's finance leaders build IPO-ready organizations URL: https://www.financealliance.io/building-ipo-ready-organizations/ Last updated: 2026-08-27T09:37:16.000Z Considerations for today's finance leaders as they build IPO-ready organizations Initial Public Offering (IPO) readiness can take years to build: disciplined planning, trusted data, and strong governance, done long before anyone calls a banker. Some finance teams don't find gaps until it's too late to close them. Join **Pigment** and **Deloitte & Touche LLP** for lessons from serving companies that went through the IPO journey, and considerations related to benchmarking a company’s readiness. ### What you can expect to learn: - How to benchmark your finance organization's IPO readiness against current leading practices - Identify potential gaps that can delay IPO readiness, and considerations related to potential activities to address identified gaps timely - Improve resilience through connected planning and scenario-based decision making - Strategies from Deloitte’s research and Pigment's research that can help as your finance team prepares for what's next - Lessons from finance leaders who have taken their organizations through the IPO process ### The challenges we'll advised on - **Capital markets can be selective and unpredictable.** Discipline and a credible story matter, consistent with growth. - **Readiness can take longer than some organizations expect.** Governance and controls readiness can require lead times ranging from 18 to 24 months. - **Manual, fragmented data can slow forecasting and reporting** when precision matters significantly. - **Macro volatility can demand faster, more confident decision making.** - **Some teams may not know where the gaps are.** This session can help as you identify and prioritize them. ### Meet the speakers [**Jay Peir**](https://www.linkedin.com/in/jay-peir-84b19143/)**, Head of Strategy and Interim CFO, Pigment** Jay leads finance, revenue operations, strategy, and pricing at Pigment. Before that, he ran the strategic planning process at a high-growth software company, connecting product strategy, go-to-market, and the financial plan, then guided a $15.7B acquisition of the business and led the integration that followed. Over a 10+ year career spanning FP&A, investor relations, treasury, and accounting, Jay has led two IPOs and raised more than $2B in capital through IPOs, follow-on offerings, convertible debt, and debt financing. [**Will Braeutigam**](https://www.linkedin.com/in/will-braeutigam/)**, US Capital Markets Transactions and Accounting Advisory Services Leader, Deloitte** Will serves as the US Capital Markets Transactions Leader and the Accounting & Reporting Offering Leader. His team has advised some of the largest companies on accounting and reporting matters and has served hundreds of companies completing capital markets transactions, helping clients navigate strategic objectives in a dynamic regulatory environment. He brings deep experience at the intersection of capital markets, accounting, and transactions, with a perspective shaped by advising clients through moments of significant change. --- *This presentation contains general information only and Deloitte is not, by means of this presentation, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This presentation is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte shall not be responsible for any loss sustained by any person who relies on this presentation.* *The services described herein are illustrative in nature and are intended to demonstrate our experience and capabilities in these areas; however, due to independence restrictions that may apply to audit clients (including affiliates) of Deloitte & Touche LLP, we may be unable to provide certain services based on individual facts and circumstances.* **About Deloitte:* As used in this document, “Deloitte” means Deloitte & Touche LLP, a subsidiary of Deloitte LLP. Please see* [*www.deloitte.com/about*](https://www.deloitte.com/about) *for a detailed description of our legal structure. Certain services may not be available to attest clients under the rules and regulations of public accounting.* ### 6 zero-based budgeting myths debunked URL: https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/ Last updated: 2026-07-08T08:13:55.000Z ## **What is a zero-based budget and why is it important?** A zero-based budget (ZBB) is a [budgeting method](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) where every dollar is assigned to a specific expense or category, starting from zero each cycle. No line item rolls over automatically. Every cost has to earn its place. Peter Pyhrr, an accountant at Texas Instruments, developed the approach in the 1970s. His idea was simple: instead of tweaking last year's numbers, [question every expense from scratch](https://www.financealliance.io/cost-benefit-analysis/). Why does that matter? Because it turns budgeting from a passive review into a proactive strategy. Unlike incremental budgeting, which uses the prior year as a baseline, zero-based [budgeting](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) asks a harder question: does this expense still deserve funding? ## **How zero-based budgeting works** The process sounds intimidating, but it's straightforward once you break it down. 1. **Reset to zero base.** No carryover, no assumptions from last cycle. 2. **Review every function and cost driver.** What does each team, project, or line item actually do for the business? 3. **Justify each expense.** Managers make the case for every dollar, tying it to a strategic goal. 4. **Allocate based on value.** Fund the activities with the strongest ROI. Cut or reduce the rest. 5. **Monitor and adjust.** ZBB isn't a one-and-done exercise. Track performance through the budgeting cycle and [refine as priorities shift](https://www.financealliance.io/rolling-forecast-best-practices/). The heavier the lift upfront, the sharper the resource allocation on the other side. [Multiple on Invested Capital (MOIC): Definition & guideIn this article, we’re zeroing in on MOIC to uncover what it is, its role in private equity, and more importantly, how you can use it to sharpen your investment evaluation skills.r![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-ec4aa18b-ea9a-4a4e-b4f1-8b905bd2d933.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--11--56ae3e73-fd3f-4a6b-84a0-a61bd4a5564f.png)](https://www.financealliance.io/multiple-on-invested-capital-moic/) ## **Zero-based budgeting vs. traditional budgeting** Traditional (or incremental) budgeting starts with last year's numbers and layers on a small increase, usually 2% to 5%. It's fast, familiar, and assumes past spending is still relevant. Zero-based budgeting doesn't make that assumption. You reset to zero, then rebuild the budget line by line based on what the business actually needs right now. The difference in mindset: - **Traditional budgeting** asks, "how much more do we need?" - **Zero-based budgeting** asks, "do we need this at all?" That shift is what makes ZBB [useful in fast-changing markets](https://www.financealliance.io/navigating-uncertainty-why-agile-fp-a-is-your-competitive-edge/), where last year's priorities may already be stale. ## **Advantages of zero-based budgeting** On paper, ZBB sounds ideal. Every dollar is scrutinized, every cost is justified, and spending lines up with what the business actually needs. Here's where it delivers. **1\. Aligns spending with current strategic objectives.** Dollars flow to what matters now, not what mattered three years ago. **2\. Cuts budget bloat.** With every expense reviewed from scratch, [teams stop funding activities out of habit](https://www.financealliance.io/5-steps-collaborative-budgeting-process/). According to Deloitte, 58% of companies using ZBB are more successful at meeting cost targets. **3\. Improves resource allocation.** Funds shift toward high-impact activities and away from redundant ones. **4\. Builds a cost-conscious culture.** When managers have to justify every line item, [mindful spending becomes the default](https://www.financealliance.io/financial-accountability/). **5\. Increases flexibility.** ZBB isn't tied to historical spending, so it [adapts quickly to changing markets](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/) or new priorities. ## **Disadvantages of zero-based budgeting** It isn't all upside. Here's what you need to weigh before rolling it out. 1. **Time-intensive upfront.** Justifying every line item takes serious effort, far more than a traditional [budgeting](https://www.financealliance.io/3-key-pain-points-in-budgeting/) cycle. 2. **Tough cultural shift.** Teams used to incremental budgets often resist. Expect friction. 3. **Short-term bias.** A constant focus on cost cuts can distract from long-term strategic bets. 4. **Morale risk.** If ZBB looks like a cover for slashing budgets, employees disengage. 5. **Can be gamed.** Savvy managers can inflate justifications to protect their turf. Used well, ZBB is a powerful tool. Used carelessly, it becomes a spreadsheet exercise that costs more than it saves. [The £7.5 million lesson: What real FP&A influence looks likeHow do you close the FP&A influence gap? You clarify, challenge, and connect so that finance moves from being reactive to being influential.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-89c6bc41-1cae-456b-89ab-9951873aa4c0.png)Finance AllianceAlexander Roche![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--19--7a963044-6f53-4faf-9bf9-24d5359937ad.png)](https://www.financealliance.io/what-real-fp-a-influence-looks-like/) ## **6 zero-based budgeting myths debunked** Now, let's dive into some of those pesky myths about zero-based budgeting (ZBB) and set the record straight, shall we? ### **Myth #1: Zero-based budgeting is only for companies in 'damage-control mode'** Many thriving industry leaders across sectors, including Amazon, actively use zero-based budgeting NOT as a last-ditch turnaround tool, but rather as an annual reset to align spending with evolving strategy in times of rapid [growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) and change. By thoroughly reviewing all expenditures through a ZBB lens, successful companies can find bloat, enable innovation investments, and tie spending directly back to current strategic priorities. ### **Myth #2: It’s too time-intensive and complex to implement successfully** No doubt, zero-based budgeting requires heavy lifting upfront. However, today's software, [analytics](https://www.financealliance.io/from-transactions-to-insights-the-role-of-cloud-powered-analytics-in-redefining-e-commerce-finance/), and targeting make smart and efficient analysis possible across all spending. The initial investment required to implement ZBB pays exponential dividends down the road in boosted clarity, visibility, and savings year-over-year. Is it painless? No. But is it worth it? Absolutely. [CapEx vs Opex | Key differences, examples & why it mattersMaster the difference between CapEx and OpEx to optimize budgeting and drive growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-224ed5c6-9c47-4e6b-8c18-3a1d97dca048.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/capex-vs-opex-c1c6f726-5904-418b-89c5-ea270ee54237.png)](https://www.financealliance.io/capex-vs-opex/) ### **Myth #3: It's all about cost reduction** When executed strategically, zero-based budgeting is not just about arbitrary cutting for cutting’s sake. At its core, ZBB provides a framework for aligning each dollar of spending very intentionally with business priorities and growth drivers. For some companies, that alignment means shifting funding from antiquated programs to innovative initiatives that keep them competitive. For others, it means doubling down on key growth areas, even increasing spending where needed. Overall, ZBB gives leadership a bird’s eye view to optimize human and financial resources. ### **Myth #4: Zero-based budgeting stifles risk-taking and innovation** Think of ZBB as a reality check for your innovative ideas. It doesn't discourage risks; it quantifies them. With increased visibility into cost implications, companies can anchor their boldest ideas in financial reality instead of best guesses. ZBB enables smart risks grounded in numbers, not just aspirations. [Artefacts are not reporting tools. They’re decision architecture.The planning process does not fail because the calendar is wrong or the model is weak. More often, it fails because the artefacts do not convert information into action.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-9024b494-1b66-4a0b-8705-d37f42bdd28b.png)Finance AllianceNoufal Basheer![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--31--61582fc5-62f9-4809-82f3-726569204a97.png)](https://www.financealliance.io/artefacts-are-not-reporting-tools/) ### **Myth #5: It's inapplicable to certain industries or sectors** Zero-based budgeting is extraordinarily versatile, adapting to apply value levers across any industry, sector, or nuanced financial landscape. Manufacturing, healthcare, financial services, tech startups, you name it. Unlike a one-size-fits-all approach, ZBB can customize to suit ANY company’s financial environment, keeping accountability while remaining flexible to business needs. ### **Myth #6: It’s short-sighted and ignores the long view** While ZBB operates on annual budget cycles for relevance, the insights gained in the annual process inform longer-term strategy. Leadership teams can connect the dots looking back at 3-5 years of zero-based budget cycles to identify trends, make [forecasts](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/), and cement steady stepping-stone decisions toward bolder five to 10-year visions. n essence, ZBB provides a regular reality check to power big dreams. ## FAQs: Zero-based budgeting #### ****Q. What is zero-based budgeting (ZBB)?** Zero-based budgeting is a financial planning method where every expense must be justified for each new period, starting from a "zero base." It's about building your budget from scratch, regardless of previous budgets, ensuring that every dollar is allocated based on current needs and goals. #### ****Q. How does zero-based budgeting differ from traditional budgeting?** Traditional budgeting often starts with the previous year's budget and makes adjustments based on new goals or changes. In contrast, ZBB starts from zero and requires justification for every item, making no assumptions based on past spending. #### ****Q. What are the main benefits of zero-based budgeting?** The primary benefits include increased cost control, enhanced alignment with strategic goals, improved efficiency, and fostering a culture of accountability and mindful spending. #### ****Q. Are there any industries where zero-based budgeting is particularly effective?** ZBB can be adapted to any industry. However, it's particularly effective in industries with fluctuating revenues, high fixed costs, or those undergoing rapid change, as it allows for flexible and responsive financial planning. #### ****Q. What is the core characteristic that defines a zero-based budget?** The defining characteristic of a zero-based budget is its requirement to justify every expense, regardless of whether it was part of the previous period's budget. This approach demands a detailed review and analysis of all expenses, ensuring that each cost contributes to the company's strategic objectives. #### ****Q. What is zero-based budgeting cost control?** Zero-based budgeting Cost Control refers to the practice of using the zero-based budgeting approach specifically for controlling and optimizing expenses. It involves scrutinizing each cost line, questioning the necessity and efficiency of each expense, and cutting or reallocating funds to ensure optimal use of resources. This focused approach to budgeting helps organizations control costs more effectively by aligning spending with strategic objectives and current operational needs. ### ### ### FP&A Summit Austin 2026 URL: https://www.financealliance.io/fp-a-summit-austin-2026/ Last updated: 2026-07-07T12:01:40.000Z Catch up on all sessions from FP&A Summit Austin 2026, including sessions from PepsiCo, Indeed, Google and more. _This post is for paying subscribers only._ ### Beyond the back office: How controllers can build visibility to accelerate career progression URL: https://www.financealliance.io/how-controllers-can-build-visibility-for-career-progression/ Last updated: 2026-07-03T15:00:20.000Z For much of my career, I believed that being the most [technically accurate person](https://www.financealliance.io/top-10-fp-a-skills-to-master/) in the room would naturally lead to greater influence. I thought that if I mastered every accounting standard, closed the books flawlessly, and made sure every number was accurate, opportunities would eventually follow. Technical excellence was the benchmark I measured myself against because, like many controllers, that's exactly what I had been trained and [rewarded](https://www.financealliance.io/why-most-finance-professionals-feel-underpaid/) to do. Over time, though, I realized something that completely changed how I thought about my career. Being technically excellent doesn't automatically earn you a seat at the table where the biggest business decisions are made. That realization wasn't discouraging. It was empowering. It forced me to rethink what it really means to create value as a finance leader and, more importantly, [what separates controllers](https://www.financealliance.io/cfo-vs-controller/) who remain in the back office from those who become strategic partners to the business. Looking back, I wish someone had challenged my assumptions much earlier. I wish someone had told me that precision and rigor are essential, but they are only the starting point. The real opportunity begins when you learn how to translate financial expertise into business influence. ## **My path wasn't planned** If there's one thing I've learned throughout my career, it's that very few successful careers follow a perfectly designed roadmap. Mine certainly didn't. I began my career at Deloitte in India, auditing U.S. and Netherlands-based asset management clients. The work was demanding, highly technical, and incredibly disciplined. It gave me a strong [accounting](https://www.financealliance.io/month-end-close-checklist/) foundation that I continue to rely on today. But I knew I wanted to broaden my perspective. That desire led me to move to San Francisco to pursue a Master's in Finance, essentially pressing reset on my career. After graduating with a 4.0 GPA and earning Dean's List recognition throughout the program, I relocated once again, this time to New York, where I began working in startup environments. That decision completely changed the trajectory of my career. At one of those early startups, the [CFO](https://www.financealliance.io/top-10-cfo-skills/) unexpectedly resigned. I wasn't hired to replace him permanently. I was simply asked to hold everything together until the company found someone else. Was I nervous? Absolutely. Did I feel completely prepared? Not at all. But I also recognized that I was probably the most qualified person available to step into the role, even if I didn't yet believe it myself. Those few months taught me more about strategic finance than the previous several years combined. Suddenly I wasn't just focused on whether the numbers were correct. I had to understand how those numbers influenced decisions, priorities, and conversations happening across the company. [Communication plan with stakeholders: a five-step guideMaster stakeholder communication in five clear steps. You can use this guide to craft clear, consistent communication that keeps everyone aligned and engaged.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-7f7fc895-687f-4c39-a479-9541f659cf88.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/5-step-stakeholder-communication-plan-d531e31e-a069-44df-b917-02319b698bb5.png)](https://www.financealliance.io/stakeholder-communication-plan/) That experience fundamentally changed how I viewed [finance leadership](https://www.financealliance.io/financial-leadership-in-changing-times-2/). From there I joined Beacon Platform, where I led multinational close processes and external audits across the United States, the United Kingdom, and Japan while helping build the [financial infrastructure](https://www.financealliance.io/operationalizing-productivity-in-a-1b-construction-vertical/) that growing companies need. Later I joined AlphaPoint as Head of Accounting, entering an industry where there wasn't an established playbook for many of the accounting challenges we faced. Crypto accounting in 2021 required us to navigate new territory almost every day. We were figuring out accounting treatments while the broader industry was still working through the same questions. It was uncomfortable, uncertain, and incredibly [challenging](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/), but it also became one of the most formative experiences of my career. Eventually I was promoted to Vice President of Finance and Accounting, reporting directly to the CEO. Today my responsibilities extend well beyond accounting into fundraising discussions, [strategic planning](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/), [budgeting](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), treasury management, and crypto treasury. None of those opportunities appeared because I became more technically accurate. They appeared because I learned how to make my expertise visible. [How to transform financial data into compelling storiesFP&A professionals have to understand the business deeply. We’re not just reporting results or explaining variances. We are taking on part of the decision-making burden.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-3c2e46bf-20a3-49cb-9249-524d9859f722.png)Finance AllianceLewis Danby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--5--3c8d71c8-bccd-4616-ac03-bead4ee0b519.png)](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) ## **Why so many controllers remain invisible** Controllers are often the people who understand the financial reality of a business better than anyone else. - We see every dollar entering and leaving the organization. - We understand how transactions connect across departments. - We know where the operational weaknesses exist because we encounter them every month during the close. Yet despite having access to this unique perspective, many controllers are excluded from [strategic](https://www.financealliance.io/how-cfos-power-business-strategy/) conversations. I've spent a lot of time thinking about why. In my experience, there are three common traps that prevent talented finance professionals from moving beyond the back office. **The first is the identity trap.** Many of us define ourselves by our technical accuracy. We become known as the person who always gets the numbers right. While that reputation is valuable, it can also become limiting. When someone asks for a strategic opinion rather than a technical answer, we hesitate because strategy isn't where we've traditionally been rewarded. **The second is the bandwidth trap.** Anyone who has worked in accounting knows the close cycle never really ends. As soon as one month finishes, preparation begins for the next. Between reconciliations, audits, variance analysis, and [reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/), there often isn't enough time left to think strategically. **The third is the access trap, and I believe this is the most important one.** Many people assume someone will eventually invite them into strategic conversations because of the quality of their work. That invitation rarely comes. The people influencing decisions are often the people who intentionally placed themselves in those conversations. Waiting for permission can become one of the biggest obstacles to career progression. [The £7.5 million lesson: What real FP&A influence looks likeHow do you close the FP&A influence gap? You clarify, challenge, and connect so that finance moves from being reactive to being influential.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-f023fa5f-351b-405a-a3e8-4e0257fccdbc.png)Finance AllianceAlexander Roche![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--19--6d5aeca3-7037-4709-ba12-fce80ca38839.png)](https://www.financealliance.io/what-real-fp-a-influence-looks-like/) _This post is for paying subscribers only._ ### How great CFOs master the unkown, with Diya Sagar [Video] URL: https://www.financealliance.io/podcast/how-great-cfos-master-the-unkown-with-diya-sagar-video/ Last updated: 2026-06-29T09:00:46.000Z _No content available._ ### The IPO readiness mistake CFOs make, with Joy Mbanugo [Video] URL: https://www.financealliance.io/podcast/the-ipo-readiness-mistake-cfos-make-with-joy-mbanugo-video/ Last updated: 2026-06-26T11:48:16.000Z _No content available._ ### Navigating uncertainty: Why agile FP&A is your competitive edge URL: https://www.financealliance.io/navigating-uncertainty-why-agile-fp-a-is-your-competitive-edge/ Last updated: 2026-06-22T08:52:04.000Z Planning for the unexpected has always been close to my heart, perhaps because, in the world of finance, uncertainty is the only certainty we have. Over the years, I’ve seen how rigid planning can leave even the most established organizations vulnerable when market conditions shift. That’s why I’m passionate about a different approach; one that embraces change rather than fears it. Agile [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) (Financial Planning & Analysis) has become a game-changer for me and the teams I’ve worked with. Originally born in the world of software development, agile principles have now made their way into finance, offering a more flexible, [collaborative](https://www.financealliance.io/chief-revenue-officer-vs-chief-financial-officer/), and adaptive way to plan for the future. This isn’t about throwing structure out the window. It’s about [building a framework](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/) that evolves in real time, helping organizations make faster, smarter decisions when the unexpected happens. In this article, I’ll share what agile FP&A really means, how it differs from traditional approaches, and the key methodologies that make it work. I’ll also explore a real-world case study from [Adobe](https://www.financealliance.io/adobes-strategy-for-customer-journey-based-financial-planning/), which successfully transformed its financial planning processes, and I’ll outline practical strategies for putting agile FP&A into action in your own organization. [The £7.5 million lesson: What real FP&A influence looks likeHow do you close the FP&A influence gap? You clarify, challenge, and connect so that finance moves from being reactive to being influential.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-df1726f7-bcc0-4042-a385-1581f41a1656.png)Finance AllianceAlexander Roche![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--19--c4f68870-5201-4c8d-9f2e-cf98ea973435.png)](https://www.financealliance.io/what-real-fp-a-influence-looks-like/) ## **Exploring agile methodologies** Before diving into the specifics of how to implement [agile FP&A](https://www.financealliance.io/unleashing-the-power-of-agile-methodologies-for-fp-a/), I want to start by clarifying what it really is. The term itself can sound like a buzzword, but the principles behind it are very practical. ### **What is agile FP&A?** Agile FP&A, short for Financial Planning & Analysis, is an approach to budgeting and forecasting that applies agile principles and values to the finance function. While agile began in software development, it has proven incredibly valuable in other areas, including finance. At its core, agile emphasizes collaboration, transparency, iteration, and adaptability. Unlike traditional FP&A, which often runs on a rigid, annual cycle with infrequent updates, agile FP&A operates in shorter, more dynamic cycles. This allows [teams](https://www.financealliance.io/fp-a-team-structure/) to adjust quickly to changes in the market, business conditions, or internal priorities. [Stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) are involved more frequently, and decision-making becomes a shared, ongoing process rather than a once-a-year event. ### **How agile differs from traditional FP&A** Traditional FP&A can be reactive, siloed, and slow-moving, producing static budgets that quickly become outdated. Agile FP&A shifts the mindset toward being proactive and dynamic. It breaks down large [budgeting](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) processes into smaller, iterative steps, and it fosters ongoing conversations between finance and the rest of the organization. This approach helps align financial decisions with real-time realities. [Top 20 FP&A skills (10 hard skills & 10 soft skills)Here are the top 20 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-6193f218-9c74-4464-8919-3441e7f2580c.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--2--603facf6-5def-4e6b-bcb7-8e96ea4f230f.png)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) ## **The core methodologies of agile FP&A** ### **1\. Focus on business value** In agile FP&A, every decision ties back to business value. Financial planning is directly aligned with strategic goals and organizational priorities. Instead of creating budgets in isolation, the [FP&A team](https://www.financealliance.io/the-5-pillars-to-build-your-next-gen-fp-a/) works closely with other departments to ensure every projection supports the company’s larger objectives. This keeps the function relevant and deeply connected to the decision-making process. ### **2\. Foster collaboration** Collaboration isn’t optional, it’s foundational. Agile FP&A depends on regular communication across departments, whether through agile boards, daily stand-ups, or [cross-functional](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) planning sessions. Finance shouldn’t work in a silo; we should be engaging with sales, marketing, operations, and other teams to ensure our reflect the full business picture. ### **3\. Commit to continuous improvement** Agile thrives on iteration. For FP&A, that means continuously refining [forecasts](https://www.financealliance.io/how-ai-forecasting-drives-smarter-financial-planning/), budgets, and processes based on feedback and performance. This might involve experimenting with new models, testing assumptions, and making small, frequent adjustments rather than waiting for an annual review. ### **4\. Embrace flexibility and adaptability** The business environment can change overnight. Agile FP&A teams are prepared to pivot quickly, whether that means re-allocating resources, rethinking priorities, or adopting new tools. This adaptability ensures financial planning stays relevant in the face of uncertainty. ### **5\. Use rolling forecasts** Instead of locking into a single 12-month budget, agile FP&A uses rolling [forecasts](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/), updating projections every three to six months (or more frequently if needed). This approach keeps forecasts current and responsive to market conditions, allowing for faster decision-making and better risk management. ### **6\. Make data-driven decisions** Data is the backbone of agile FP&A. By leveraging real-time [analytics](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/), we can identify trends, uncover hidden patterns, and produce forecasts that are both timely and accurate. This not only improves decision-making but also builds trust in the [finance function’s insights](https://www.financealliance.io/building-an-fp-a-function-strategies-for-effective-team-and-organizational-structure/). [Driving innovation: From CFO “no” to strategic growth partnerDiscover how finance teams can drive innovation, not block it. Learn how strategic finance leaders enable growth through risk-balanced decisions, scenario planning, and capital allocation frameworks.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-180.png)Finance AllianceKevwe Ijatomi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--2.png)](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) ## **Case study: Adobe’s transformation** I believe the best way to move from theory to practice is through a real-world example. One of my favorite cases to share is Adobe’s transformation because it perfectly illustrates how agile FP&A can help a company reinvent itself and thrive in the face of major change. ## **The challenge** Adobe is a multinational software company, best known for its creative tools like Photoshop, Illustrator, and the now-retired Adobe Flash. For years, its business model revolved around selling perpetual software licenses, which is a model that produced big revenue spikes when new versions launched, but left long gaps in between. As technology evolved and customer expectations shifted, Adobe faced a daunting challenge: - **Transitioning its revenue model** from one-time license sales to a subscription-based service through Adobe Creative Cloud. - **Integrating data systems** to support this new model. - **Scaling agile processes** to stay responsive in a rapidly changing software market. Shifting to a subscription model wasn’t just a pricing change, it required a complete overhaul of how the company planned, forecasted, and analyzed its [financial performance](https://www.financealliance.io/why-cfos-need-to-be-people-managers/). [FP&A career path and salary guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-efec4af0-8417-4b94-8f24-7d8497fdc400.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--10--1c1b46eb-ce83-42a5-aa1d-063c89f034bd.png)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) ## **The agile FP&A approach** To navigate this transition successfully, Adobe embraced agile FP&A principles: **1\. Subscription model planning** – Moving to subscriptions required entirely new revenue forecasting methods and resource allocation models. Instead of predicting large, irregular spikes, Adobe now had to plan for [consistent, recurring revenue streams](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/). **2\. Data-driven decision-making** – Adobe invested heavily in data analytics to gain real-time insights into customer behavior. This data became the backbone of their financial planning, enabling more accurate [forecasts](https://www.financealliance.io/how-to-forecast-inventories/) and quicker responses to market signals. **3\. Iterative planning cycles** – Rather than sticking to rigid annual plans, Adobe adopted shorter, iterative cycles that allowed them to adjust forecasts, budgets, and investment strategies in real time based on subscription performance. ## **The results** ### **1\. Predictable, recurring revenue** The shift from one-time purchases to recurring subscriptions smoothed out Adobe’s revenue streams. Instead of depending on large but unpredictable launch cycles, the company could now count on steady monthly income. This made long-term planning easier, improved capital allocation, and reduced the uncertainty inherent in the old model. ### **2\. Enhanced customer insights** With real-time analytics, Adobe gained a deeper understanding of how customers used its products. They could quickly identify popular features, spot areas needing improvement, and act on feedback faster. This responsiveness not only boosted customer satisfaction but also increased loyalty and retention. ### **3\. Faster market response** Shorter planning cycles meant Adobe could bring new products and features to market more quickly. They could refine offerings almost in real time, staying at the cutting edge of the industry and seizing market opportunities without waiting for the next annual planning round. ### **4\. Stronger cross-functional collaboration** The transformation required close coordination between finance, product development, marketing, sales, and operations. Agile FP&A encouraged these teams to work together, bringing diverse perspectives into the planning process and ensuring alignment across the organization. [How I’m thinking about AI after 27 years in financeAfter 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-6445b506-24a9-467f-b335-8fb4b211971a.png)Finance AllianceGeeta Malhotra![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--9239ffae-3f37-4abb-8854-d6a977004ac6.png)](https://www.financealliance.io/ai-in-finance-business-strategy/) ## **Why this matters** Adobe’s adoption of agile FP&A was critical to its successful shift to a subscription-based model. By combining predictable revenue with data-driven insights, faster decision-making, and cross-functional teamwork, Adobe not only maintained its market leadership but also positioned itself for [sustained growth](https://www.financealliance.io/guide-to-company-growth/). Their story is a powerful example of how a company can reinvent itself through agile methodologies and a customer-centric approach, turning uncertainty into a competitive advantage. ## **Strategies for implementing agile FP&A** Moving from theory to practice requires a clear roadmap. Over the years, I’ve learned that successful agile FP&A implementation isn’t about adopting a few new [tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/) or updating a forecasting schedule; it’s about creating the right foundation, building the right frameworks, and embedding agility into the way your team works every day. Here are the strategies I’ve found most effective. [Liquidity in DeFi: Market makers, AMMs, & the hybrid futureWhere decentralized freedom and market-maker efficiency create the next era of liquidity.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-181.png)Finance AllianceAlexander Vorobev![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--70-.png)](https://www.financealliance.io/liquidity-in-defi-market-makers-amms-and-the-hybrid-future/) ### **1\. Establish agile foundations** Before anything else, agility needs to be embraced at the leadership level. Without strong sponsorship from the top, it’s hard to make the cultural and process changes necessary for agile FP&A to thrive. - **Leadership buy-in** – Leaders must understand not just the mechanics of agile, but also the value it brings faster decision-making, greater adaptability, and stronger cross-functional alignment. - **Training and development** – Equip both the FP&A team and relevant stakeholders with a solid understanding of agile principles. This training fosters flexibility, responsiveness, and collaboration. - **Change management** – Moving from traditional FP&A to agile requires careful transition planning. Communicate the benefits clearly, set expectations for new workflows, and prepare the organization for a more dynamic way of working. ### **2\. Build the agile FP&A framework** With the foundation in place, you can develop the frameworks that make agility possible. - **Rolling forecasts** – Replace or complement the annual budget with rolling forecasts updated monthly or quarterly. This ensures plans reflect the latest market conditions and business performance. - **Scenario planning & stress testing** – Develop multiple [financial models](https://www.financealliance.io/12-financial-modeling-best-practices-to-avoid-frustrations/) to prepare for different possible futures - best case, worst case, and everything in between. This allows you to respond quickly when circumstances change. - **Technology integration** – Invest in FP&A software that supports real-time data analysis, collaborative planning, and scenario modeling. AI and machine learning can further enhance forecasting accuracy, provided the tools are user-friendly and integrate smoothly with existing systems. [Rethinking finance teams for the age of AIWhen AI is implemented thoughtfully, finance can become one of the most strategically valuable functions inside the organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-f19151fb-8d69-4fd1-a53a-a59974ea430f.png)Finance AllianceKate Motonaga![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--30--d38cb000-1476-4449-bf63-772c019ca486.png)](https://www.financealliance.io/rethinking-finance-teams-for-the-age-of-ai/) ### **3\. Operate agile FP&A in practice** Agility isn’t just a planning process, it’s a way of working across the organization. - **Cross-functional teams** – Include finance, sales, operations, marketing, and other departments in the planning process. This ensures alignment and eliminates silos that slow decision-making. - **Decentralized decision-making** – Empower managers with the information and authority to make timely financial decisions without unnecessary delays. - **Continuous improvement** – After each planning cycle, hold retrospectives to review what worked, what didn’t, and how processes can be improved. This keeps the system evolving and prevents stagnation. ### **4\. Define performance metrics** To sustain agility, you need to measure it. Identify metrics that reflect agile goals, such as: - Speed of response to market changes. - [Forecast accuracy](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) over time. - Effectiveness of scenario planning. These KPIs help track progress, validate the value of agile FP&A, and highlight where further refinements are needed. --- *This article is based on a presentation given by Imane Haouassia at our virtual FP&A Summit. There are many more* [*upcoming events*](https://www.financealliance.io/events/) *you can join to learn from the best.* ### The £7.5 million lesson: What real FP&A influence looks like URL: https://www.financealliance.io/what-real-fp-a-influence-looks-like/ Last updated: 2026-06-19T09:14:39.000Z When I talk about the “[FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) influence gap,” I’m referring to the gap between the level of influence some [FP&A teams](https://www.financealliance.io/fp-a-team-structure/) currently have and the level of influence they should have in order to deliver the greatest possible benefit to their organizations. It’s a gap I’ve seen firsthand. And if we’re honest, it’s one that exists in many businesses. Let me ground this in a couple of statistics. A survey conducted last year by FP&A Trends found that only 37% of FP&A teams see themselves as well established [business partners](https://www.financealliance.io/transforming-from-accounting-to-fp-a-business-partnering/). That’s barely over a third. Even more striking, 35% of CFOs (arguably the most commercially involved finance leaders in a business) say they are barely involved in commercial decision-making. If [CFOs](https://www.financealliance.io/how-cfos-power-business-strategy/) feel removed from commercial decisions, what does that say about the rest of finance? That, to me, signals a clear disconnect. A clear influence gap. I’m the Deputy Group Deputy Head of FP&A at Peel Ports Group. We operate nine ports across the U.K., generate around £800 million in revenue, and employ roughly 2,500 people. If I had to summarize our business in the simplest possible way, it would be this: we take things off ships and we put things on ships. That’s what we do. Over the past year and a half, we’ve been on a journey to close the FP&A influence gap within our own organization. It hasn’t been theoretical. It’s been practical, sometimes uncomfortable, and ultimately [transformative](https://www.financealliance.io/how-generative-ai-is-transforming-finance/). What I want to share is what that journey looked like and the principles that helped us change our impact. [How to turn forecasting & budgeting mistakes into successesExplore key lessons in implementation processes and corporate strategy, and how you can use them to achieve real, tangible results in your FP&A function.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-379.png)Finance AllianceJames Manning![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--9--2.png)](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) ## **When finance wasn’t in the room** Let me take you back to December 2023. We were in the middle of a large transaction involving a long-term lease arrangement with a customer in the steel industry. I’ve changed a few details for confidentiality reasons (it was an [M&A-related](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) deal) but what I can say is that it was significant. Over the lifetime of the agreement, it was worth tens of millions of pounds, potentially approaching £100 million. There was a flurry of activity. Our Chief Operating Officer, who was championing the deal, was in active discussions with the customer. There were internal meetings to determine how the arrangement would work operationally and commercially. Legal was involved, drafting contracts and reviewing terms. The whole process built toward a deadline: March 31, 2024, our financial year-end. At 11:45 p.m. on March 31, the deal was signed. It was done. Now here’s the key question: when did finance get involved? Not in December, when the idea was being shaped. Not in March, when negotiations intensified. Not even on March 31, as final terms were agreed. Finance got involved on April 1, 2024\. The day after the deal was signed. After the next 50 years of that part of our business had effectively been set. We were simply not part of the process. That’s not to say the deal was done recklessly. We have capable, commercially minded people. But the decisions were based largely on experience and judgment, on a sense that the deal “felt about right.” At that scale, that’s not good enough. Where were the financial checks? Where was the analysis of long-term impact? Did anyone fully understand the total financial consequences? If we’re honest, no, not in a structured, robust way. At around the same time, in January 2024, we had appointed a new [CFO](https://www.financealliance.io/top-10-cfo-skills/). When he saw that a major deal had been completed without finance involvement, it didn’t sit right with him. Nor, I suspect, would it sit right with most of you reading this. On one side, we had a finance function with analytical capability and commercial understanding. On the other, major commercial decisions were being made without that input. Something had to change. The decision was made to establish a dedicated FP&A team. We already had financial [accounting](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/) and management accounting teams, but this new function would focus on forward-looking analysis and commercial engagement, particularly involvement in significant deals. One of our explicit objectives was to ensure [FP&A](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) had a seat at the table. [How finance is evolving from reporting to innovationIs your finance team seen as a roadblock? Discover how to evolve finance from a cost center to a strategic driver of innovation and growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-380.png)Finance AllianceSiqi Chen![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--9.png)](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) ## **A second chance and a different approach** By summer 2024, we had our first real opportunity. Coincidentally, it involved the same customer. This time, however, the proposal was even more strategic. The customer was looking to expand from being a relatively small presence at one of our ports to becoming a major, strategic partner across multiple sites. Again, we were talking about tens of millions of pounds over the lifetime of the arrangement. The key difference? We were involved from the beginning. We met with the Chief Operating Officer, who was again sponsoring the deal. We spoke with the divisional director and [finance director](https://www.financealliance.io/what-does-a-finance-director-do/) to understand the local impact. We engaged operational teams to grasp what would change on the ground. We reviewed management accounts to understand historical [performance](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) and what we might be giving up. We also looked outward (at market trends and external research) to test whether our assumptions about [growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) and demand aligned with reality. This wasn’t just box-ticking. It was deliberate. What we were doing, fundamentally, was building understanding. That brings me to the first of three principles I believe are essential for closing the FP&A influence gap: clarify. [The best working capital strategies for FP&AUncover the best working capital strategies for FP&A in this blog, which reveals how working capital management acts as a key cash driver.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-381.png)Finance AllianceLiudmila Gudina![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--42--2.png)](https://www.financealliance.io/the-best-working-capital-strategies-for-fp-a/) ## **Clarify: build a deep and independent understanding** If you don’t truly understand what you’re working on, you have no chance of influencing it. Clarifying means developing a broad, deep, and (crucially) independent understanding of the issue at hand. You need to know your organization’s strategy, market position, and commercial drivers. It’s not enough to understand the numbers; you need to understand what the business is trying to win at. What does [success](https://www.financealliance.io/fast-tracking-your-fp-a-career/) look like? What is it trying to be better at than competitors? You need to talk widely. Formal meetings are important, but informal conversations matter just as much. A chat in a hallway can reveal as much insight as a boardroom discussion. Different individuals bring different information and different biases. You also need to combine internal and external perspectives. Organizations can become insular. We might believe we are outperforming the market, but external data may tell a different story. Without that external lens, you risk reinforcing internal assumptions rather than challenging them. And wherever possible, you need to see the business in action. If you’re based at head office, get to site. In manufacturing, visit the production line. In [retail](https://www.financealliance.io/how-to-forecast-inventories/), walk the store floor. In tech, sit with developers. Understanding how things really get done (beyond the formal process charts) is invaluable. Power and influence in an organization don’t always sit where the org chart suggests they do. Clarify first. Without that foundation, everything else is fragile. ## **Challenge: add value through constructive tension** After weeks of meetings and analysis, we built our initial financial model for the deal. We went back to the COO with our findings. Our conclusion was blunt: on a net basis, the deal would lose us £15 million over its lifetime. What started as a planned 15-minute update became a 90-minute grilling. Had we considered certain revenue streams? Yes, but associated costs offset them. Had we factored in operational efficiencies? Yes, but they weren’t sufficient to bridge the gap. It was a robust, at times uncomfortable, back-and-forth. At that moment, it could have gone either way. We could have been sidelined again. Or we could lean into the discomfort and stay engaged. We chose the latter. From that discussion, both sides gained new insight. The COO left with food for thought, areas where the deal might be reshaped. We left with additional information that improved our model. That experience reinforced the second principle: challenge. Challenging isn’t about being obstructive. It’s about raising constructive tension. It means questioning assumptions, highlighting risks, and bringing an independent financial perspective. It also means translating insight into action. Saying “we’ll lose £15 million” isn’t enough. You must explain why and identify levers that could change the outcome. The classic framework applies: what, so what, now what? You also need to be selective. If you challenge everything, you dilute your impact. Credibility matters. When you do challenge, it must be backed by evidence and grounded in genuine value-add. [Lessons on building robust planning, budgeting, and forecasting processesEvery element (foundation, philosophy, rituals, and artefacts) should serve the needs of stakeholders, particularly shareholders.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-382.png)Finance AllianceNoufal Basheer![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight.jpg)](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/) ## **Connect: make influence land** We refined our model, incorporating new information and testing multiple scenarios. When we met the COO again, we made a deliberate shift in how we communicated. We minimized financial jargon. Instead of focusing on [EBITDA](https://www.financealliance.io/ebitda-calculator-guide/) and net present value, we talked about operational metrics: vessel volumes, throughput, and capacity. We explained the story behind the numbers, including both pros and cons. This time, the message landed. Our updated analysis showed that the deal was worth more than initially thought, both to us and to the customer. That insight gave the COO a concrete, data-backed position to return to the negotiating table. That brings me to the third principle: connect. You can understand the business. You can challenge assumptions. But if you can’t connect with decision-makers, your impact is limited. Connecting means establishing [trust](https://www.financealliance.io/fp-a-business-partner/) and credibility. It means being seen as a business partner, not just “the finance person.” It requires early and consistent engagement, strong cross-functional relationships, and the ability to translate numbers into narrative. Without connection, challenge feels like obstruction. With connection, challenge feels like [collaboration](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/). ## **From analysis to outcome** On the final day of negotiations, the COO informed us that he had secured an additional £7.5 million in value from the deal directly supported by the analysis we provided. Purely on the initial math, that would still leave a £7.5 million shortfall against our original £15 million loss projection. But the revised structure, combined with strategic considerations that are harder to quantify, shifted the balance in our favor. The important point is this: finance was at the table. Finance influenced the outcome. That £7.5 million wasn’t an abstract number. It was the result of cutting through complexity and articulating value clearly and credibly. Since then, [FP&A](https://www.financealliance.io/fast-tracking-your-fp-a-career/) has remained embedded in major commercial discussions. We’re currently involved in three significant deals. We’re busy and we’re influential. ## **Making models withstand scrutiny** I was asked how we ensured our model was robust enough to withstand challenge. There’s no magic formula. It comes down to time and rigor. You have to live with the model. Stress-test it. Ask yourself repeatedly: what could break here? What assumptions are fragile? Where could this be wrong? You won’t catch everything. In our case, the only real issues raised were based on information we genuinely hadn’t had access to beforehand. But deliberate testing and critical thinking are essential. Influence collapses if your analysis doesn’t stand up to scrutiny. ## **Influencing beyond the C-suite** Another question I’m often asked is whether influencing senior leaders is easier than influencing frontline managers. In my experience, the approach is similar. When working with managers closer to day-to-day operations, data becomes even more powerful. Those individuals are busy running operations; discharging vessels, coordinating logistics, managing teams. They often don’t have the time or tools to step back and analyze trends. When you come prepared with thoughtful analysis and a clear perspective, you can add real value. You bring a lens they may not otherwise have. [Top 15 must-have Chief Financial Officer skillsThe modern CFO wears many hats and must master a variety of CFO skills. But what skills does the CFO of the future need to stay on top of their game? Keep reading as we uncover some of the most important Chief Financial Officer skills…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-383.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--2--4.png)](https://www.financealliance.io/top-10-cfo-skills/) ## **Closing the gap** So how do you close the [FP&A](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/) influence gap? You clarify. You build deep, independent understanding. You challenge. You raise constructive tension and add perspective. You connect. You ensure your insight is trusted, understood, and acted upon. When those three elements work together, finance moves from being reactive to being influential. From reporting what happened to shaping what happens next. For us at Peel Ports Group, that shift has been tangible. We’ve moved from hearing about deals after they’re signed to actively shaping them before they are. And in my view, that’s where FP&A truly belongs. --- **This article is based on Alexander Roche's brilliant talk at our FP&A Summit London. Check out our** [**events calendar**](https://www.financealliance.io/events/) **to see what's coming up (we have both virtual and in-person events you can choose from).** ### When insight stalls: Closing the gap between analysis and executive action URL: https://www.financealliance.io/closing-the-gap-between-analysis-and-executive-action/ Last updated: 2026-06-12T15:00:49.000Z When I speak with [finance leaders](https://www.financealliance.io/how-cfos-power-business-strategy/), I often start with a simple question: Is the speed of decision-making in your company adequate? The answer is usually visible before anyone says a word. A few hesitant hands might go up, but most people remain still. The reaction is remarkably consistent across organizations, industries, and company sizes. It reveals a challenge that many of us recognize but struggle to solve. Despite having more information, [better analytics](https://www.financealliance.io/mastering-data-storytelling/), and increasingly sophisticated tools, organizations are not necessarily making decisions any faster. Over the last twenty years, I have watched the finance function evolve dramatically. We have moved far beyond the days when [finance teams](https://www.financealliance.io/how-to-optimize-finance-teams/) were primarily focused on reporting results after the fact. Today, finance is expected to provide [strategic insight](https://www.financealliance.io/how-cfos-power-business-strategy/), partner closely with the business, and help shape the future direction of the organization. We often talk about finance earning a seat at the table. In many organizations, that has happened. Finance teams have access to more data than ever before. We have stronger analytical capabilities, [better visualization tools](https://www.financealliance.io/financial-charts-and-graphs/), and increasingly sophisticated [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) models. Yet something isn't working. Better data is not automatically translating into better or faster decisions. In many cases, the opposite is happening. Organizations are producing more analysis, generating more [scenarios](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/), and introducing more perspectives into discussions, only to find themselves trapped in endless cycles of debate and review. The result is what I think of as a breakdown between [insight](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/) and action. [Chief Revenue Officer vs Chief Financial Officer comparisonThe CFO oversees accounting, cash flow, and financial planning, while the CRO is laser-focused on driving sales and boosting revenue. But that’s just scratching the surface.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-d8fef612-7bb2-47d2-970f-b3c29cdfd02b.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles-2-60c1ae2d-1fb6-468f-815a-70a4d0b7aac7.png)](https://www.financealliance.io/chief-revenue-officer-vs-chief-financial-officer/) ## **The growing problem of decision debt** One of the concepts I often discuss is what I call "decision debt." Organizations spend enormous amounts of time creating analyses, evaluating scenarios, and examining options from every possible angle. While thoughtful analysis is important, there comes a point where additional information stops creating clarity and starts creating delay. The longer we postpone a decision, the greater the cost becomes. If a project launch is delayed because [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) continue requesting more analysis, there is a [cost](https://www.financealliance.io/cost-benefit-analysis/). If an underperforming initiative continues because no one is willing to make the call to stop it, there is a cost. If leaders spend weeks revisiting the same questions instead of moving forward, there is a cost. Time is money. Every week spent circling around a decision rather than making it translates into real financial consequences. [Resources](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) remain tied up. Investments remain uncertain. Opportunities are missed. Over time, those delays accumulate into decision debt. As I have observed this pattern across multiple organizations throughout my career, I have become convinced that the problem is rarely about the quality of the people involved. It is rarely about a lack of [data](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/). [How I’m thinking about AI after 27 years in financeAfter 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-d2ca7344-e1ae-4be2-a276-5abe305912a6.png)Finance AllianceGeeta Malhotra![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--7164b491-1408-4c1b-a9e6-9e0e011d05b3.png)](https://www.financealliance.io/ai-in-finance-business-strategy/) More often, it comes down to how organizations are structured to make decisions in the first place. What matters is whether a company has created what I think of as a decision operating system. The question is not simply whether you have smart people or good analytics. The question is whether your governance structures, forums, incentives, and operating rhythms are designed to enable decisions rather than delay them. ## **Three common breakdown points** When I examine organizations struggling with slow decision-making, I consistently see three recurring issues. For expert advice like this straight to your inbox every month, sign up for Pro+ membership. You'll also get access to hundreds of hours of exclusive video content, a complimentary Summit ticket, and so much more. So, what are you waiting for? [Get Pro+ ](https://www.financealliance.io/pro-plus-membership/) **The first is misaligned incentives.** Most organizations are structured around divisions, business units, functions, or teams. Every group has its own goals, scorecards, and measures of success. On paper, that seems reasonable. In practice, it often creates friction. Consider a situation where procurement is measured on reducing vendor spend. The procurement team identifies opportunities to consolidate software vendors and eliminate redundant [tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/). From their perspective, the initiative makes perfect sense. Then they approach their technology partners. The technology organization may be measured primarily on speed of delivery. Their priority is maintaining continuity and avoiding disruptions. As a result, they may resist changing tools even if consolidation would create [financial benefits](https://www.financealliance.io/cost-benefit-analysis/). Both groups are acting rationally based on their incentives. The problem is that they are not working toward the same objective. This dynamic plays out repeatedly across organizations. Marketing, [technology](https://www.financealliance.io/rethinking-finance-teams-for-the-age-of-ai/), operations, finance, and business teams can all find themselves pursuing goals that unintentionally conflict with one another. When that happens, decisions stall because nobody is aligned around a common outcome. _This post is for paying subscribers only._ ### Chief Revenue Officer vs Chief Financial Officer URL: https://www.financealliance.io/chief-revenue-officer-vs-chief-financial-officer/ Last updated: 2026-06-11T08:31:55.000Z They're two of the most important [C-suite](https://www.financealliance.io/winning-over-the-c-suite-managing-change-resistance/) positions in any company. The Chief Financial Officer (CFO) and Chief Revenue Officer (CRO) work to keep the business financially stable and profitable. Though their titles sound similar, the CFO and CRO have very distinct responsibilities. The [CFO](https://www.financealliance.io/top-10-cfo-skills/) oversees accounting, cash flow, and [financial planning](https://www.financealliance.io/10-big-picture-financial-planning-steps/), while the CRO is laser-focused on driving sales and boosting revenue. But that's just scratching the surface. Dig a little deeper and you'll uncover the key differences between these two chief roles: differences that highlight why the Chief Revenue Officer vs Chief Financial Officer dynamic is so crucial for companies (and their success). So, what exactly are these key differences? Read on as we discuss how both roles differ, their main responsibilities, and how they can work together to drive [growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) and profitability. [What does a finance director do? | Career guideIn this career guide, we take you through all the major pillars of this role from key responsibilities to skills, qualifications, salary, and more.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-1824a7c8-55b7-4880-a498-c47dff1182bc.png)Finance AllianceChristopher Reed![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--13--2-75ad6c94-5a1c-4bfe-a551-6bd706c5673b.png)](https://www.financealliance.io/what-does-a-finance-director-do/) # **Chief Revenue Officer vs Chief Financial Officer** ## **What is a Chief Financial Officer (CFO)?** A [CFO](https://www.financealliance.io/tag/cfo/), or Chief Financial Officer, is the financial leader of a company and a key member of the C-Suite. They manage the company's finances, [create budgets](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), oversee [financial reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/), and make strategic decisions to ensure the organization's fiscal well-being. Essentially, they're in charge of the financial direction and health of the company. ### **What is the responsibility of a CFO in a company?** A CFO is responsible for: - Overseeing all accounting and financial reporting - Managing cash flow and tracking expenses - Preparing budgets and financial forecasts - [Assessing and mitigating financial risks](https://www.financealliance.io/financial-crime-risk-management-fcrm/) - Securing financing and managing capital - [Overseeing audit processes and tax compliance](https://www.financealliance.io/finance-and-compliance/) - Creating financial models and analyses - Providing strategic guidance on finances ### **Who is higher than the Chief Financial Officer?** The only role that outranks the Chief Financial Officer is the Chief Executive Officer. The CFO is as high up the corporate ladder as you can get, aside from being the top boss. So, the CFO holds major power and influence in any organization. [Rethinking finance teams for the age of AIWhen AI is implemented thoughtfully, finance can become one of the most strategically valuable functions inside the organization. Here’s how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-2e808562-dfac-4053-b55a-01e21b201662.png)Finance AllianceKate Motonaga![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--30--76c24b86-d8cd-4c34-8f04-b30ed20775a1.png)](https://www.financealliance.io/rethinking-finance-teams-for-the-age-of-ai/) ### **What position is right below a CFO?** Right below the CFO you'll usually find the [VP of Finance, Head of Finance, or Corporate Controller](https://www.financealliance.io/cfo-vs-controller/). They usually oversee the day-to-day management of the [finance team](https://www.financealliance.io/fp-a-team-structure/) and records. The Controller handles more of the nuts and bolts while the visionary CFO keeps their eyes on the [strategic financial big picture](https://www.financealliance.io/10-big-picture-financial-planning-steps/). ### **Is the CFO responsible for revenue?** While the CFO oversees the finances, they aren't directly responsible for bringing in revenue. That crucial job belongs to the Chief Revenue Officer. The CFO manages the money while the CRO's job is to maximize sales and income. So the CFO ensures profits are optimized while the CRO makes sure revenue is growing steadily. ## **What is a Chief Revenue Officer (CRO)?** As we mentioned, the [Chief Revenue Officer](https://www.revenueoperationsalliance.com/chief-revenue-officer-revenue-growth-from-the-c-suite/) (CRO) is a key executive who oversees and leads strategies related to generating revenue for a company. They typically manage sales, marketing, and customer-related functions to drive growth and maximize revenue streams. The CRO's role is to align these departments, identify new business opportunities, and create a cohesive approach to boost the company's overall revenue and [profitability](https://www.financealliance.io/profit-planning/). [Top-Down vs. Bottom-Up Forecasting | Finance AllianceTop-down vs bottom-up forecasting: Which method should you use to create accurate sales forecasts? Find out in this article.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-18538272-9b57-4815-a8b5-33930d437816.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images-Text--1--62ea7cd6-b9fc-439b-a031-a0c9cff09a5c.png)](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) ### **CRO responsibilities** The CRO is all about driving revenue and sales. Their primary focus is boosting top-line growth. Some core Chief Revenue Officer responsibilities include: - Developing the company's go-to-market and sales strategies - [Setting targets for revenue growth](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) - Leading and managing the sales organization - Overseeing customer acquisition efforts - Identifying new revenue opportunities - Aligning sales initiatives across departments - Crafting incentive programs to motivate the sales team - Providing visibility into sales pipelines and [forecasts](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) ### **Who reports to a Chief Revenue Officer?** The Chief Revenue Officer has a whole team of revenue roles reporting to them. Typically, the sales department, including all the sales VPs, [directors](https://www.financealliance.io/what-does-a-finance-director-do/), and managers, reports directly to the CRO. This allows the CRO to drive strategy and sales execution across the entire sales org. The CRO also often has marketing under their purview since marketing plays a key role in supporting sales pipelines and [lead generation](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/). In some cases, Customer Success may also report to the CRO. The CRO is responsible for the full revenue lifecycle, from bringing in new business to retaining and growing existing accounts. Having all these critical revenue-focused teams under one leader allows the CRO to power a unified revenue-generation machine. [Why scenario modelling matters more in high-growth markets like AustinConversations around financial agility, capital efficiency, workforce planning, and scenario strategy are becoming increasingly important among CFOs and FP&A leaders operating in high-growth markets.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-85fdfd26-a3b8-4be9-ba2b-3be9a32b47e6.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--28--1be95a68-ee29-4c90-bf11-9ab6230e1308.png)](https://www.financealliance.io/why-scenario-modelling-matters-more-in-high-growth-markets-like-austin/) ## **Common ground (CFO vs CRO)** While their roles may sound distinct, the CFO and CRO do *share* some essential territory. Both are deeply committed to the company's bottom line. Their success is measured by the firm's financial well-being, be it through managing expenses, increasing [profits](https://www.financealliance.io/profit-planning/), or scaling revenue streams. Both roles also require a deep understanding of the business landscape, an [ability to forecast trends](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/), and a knack for strategy implementation. Their mutual goal? Ensuring the company thrives in both the short *and* long run. While the CRO and CFO have their unique territories, they're two sides of the same coin. Both are indispensable in steering the company towards financial success and stability. ## **Is CFO higher than CRO?** In the traditional corporate hierarchy, the Chief Executive Officer (CEO) is at the top, followed by other C-suite executives. Both the Chief Financial Officer (CFO) and Chief Revenue Officer (CRO) are part of this executive team, but their positions can vary in terms of reporting [structure](https://www.financealliance.io/how-to-optimize-finance-teams/) depending on the organization. However, in some companies, the CFO is considered higher in the hierarchy than the CRO. But generally speaking, the CFO and CRO are peers: neither role outranks the other. They both sit at the highest level of the organization as C-suite executives. The ideal relationship between the CFO and CRO is a partnership of equals. They collaborate closely together to drive profitable growth. [CapEx vs Opex | Key differences, examples & why it mattersMaster the difference between CapEx and OpEx to optimize budgeting and drive growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-2faa025a-c776-4c62-b333-7bf9e08f0ee9.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/capex-vs-opex-327b235a-28dc-4c6e-931b-d132c4f139be.png)](https://www.financealliance.io/capex-vs-opex/) ## **Key differences between a Chief Revenue Officer vs CFO** While the CFO and CRO have complementary aims, there are key differences between the roles: ### **Background and evolution of the roles** The CRO role emerged more recently, gaining traction in the 1990s as global competition heated up. ### **Priorities** As outlined earlier, CFOs focus on the company's profits, while CROs drive revenue. A CFO's core aim is to maximize income, [minimize costs](https://www.financealliance.io/5-cost-reduction-strategies/), and ensure financial discipline across the organization. CFOs keep a close eye on cash flow, balance sheet strength, liquidity, and return on investment. They provide financial guidance, [modeling](https://www.financealliance.io/10-best-financial-modeling-tools/), and analysis to inform strategic decisions across the business. On the other hand, CROs drive revenue by concentrating directly on sales growth and customer acquisition. Their priority is boosting the top line, whether through pricing, product development, marketing, sales operations, or market expansion. CROs bring deep sales strategy expertise and lead the charge in profitably scaling revenue. They focus on managing the sales organization, improving sales productivity, and identifying new monetization opportunities. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-122f525b-3488-4c5f-ba7f-756257bfdcec.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-1f32c116-ea8f-473d-b341-8d0302c5f2f4.png)](https://www.financealliance.io/financial-charts-and-graphs/) ### **CFO vs CRO skills** CFOs excel at [numerical analysis, modeling, forecasting and risk assessment](https://www.financealliance.io/top-10-cfo-skills/). CROs thrive at salesmanship, relationship building, persuasion and market strategy. They both bring very different, but important, capabilities to the table: **CFO skills** - Financial modeling and analysis - Data interpretation - Accounting expertise - Budgeting and [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) - Risk assessment - Process optimization - Strategic financial planning - Audit oversight - Tax strategy - Capital [allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) - Compliance management **CRO skills** - Sales management - Marketing and messaging - Persuasion and influence - Customer insights - Pricing strategy - Sales operations - Sales training and coaching - Compensation design - Pipeline management - Channel optimization Find out more about key [CRO skills](https://www.revenueoperationsalliance.com/exploring-the-revenue-operations-career-path/) here. [Fast-track your FP&A career with tips, success stories, and networking strategiesFP&A is not always a clearly signposted career path, and for many people, myself included, it’s something you only really understand once you’re already in the world of work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-a0541627-6607-4c86-88a4-5d5ac3d316e8.png)Finance AllianceJon Yuregir![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--15--4f0939e5-e421-4c67-b15e-54bd15986ced.png)](https://www.financealliance.io/fast-tracking-your-fp-a-career/) ### **Key metrics** CFOs focus on metrics related to money and overall profitability like [cash flow](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/), working capital, gross profit margin, current ratios and so on. CROs drill down on metrics that impact revenue. These include sales growth, customer acquisition, churn rate and pipeline trends. ## **What is the relationship between CRO vs CFO?** The relationship between the CFO and CRO is collaborative and interdependent. While their primary responsibilities may differ, their efforts often intersect, especially in areas where financial decisions and risk management align. [The CFO’s role in creating long-term value through M&AFor M&A, you need rigorous valuation models, thoughtful capital planning, thorough due diligence, and strong operational execution. But you also need empathy, communication, flexibility, and patience.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-991513fd-5061-4125-8093-22bb18cd6db1.png)Finance AllianceChristopher Toumajian![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--29--348e0ec4-0140-487f-b534-4adc53190f0b.png)](https://www.financealliance.io/maximizing-roi-in-mergers-and-acquisitions/) ### **Friction points between CFOs and CROS** Both roles aim for profitable growth, but there can be natural friction between the cautious, risk-averse CFO and opportunistic CRO. CFOs must ensure financial discipline and often play "bad cop" by posing challenging questions about the sales team's assumptions and projections. CROs can get frustrated by conservative financial hurdles imposed by the CFO. The CFO and CRO should function as partners, *not* adversaries. When aligned, they balance prudent financial management with an appetite for top-line growth. **Some sources of tension between these roles include:** - CROs pushing for expensive sales initiatives that the CFO deems too risky - CFOs rejecting lead generation campaigns based on low ROI projections - Disagreements over [sales forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) and pipeline assumptions - CROs incentivizing revenue growth in ways that sacrifice margins **Tips to resolve issues:** - Establish joint KPIs to unite their focus - Improve forecasting by collaboratively questioning assumptions - Develop revenue goals that balance growth, profitability and risk - Maintain open communication and transparency between teams ### **Can a CFO also be a CRO?** In small companies, it's possible for the CFO to also handle CRO duties, at least temporarily. But in larger firms, the extensive responsibilities of both roles make this difficult to sustain. The CFO risks getting spread too thin and being ineffective in one or both roles. Specialized CRO expertise in sales strategy and execution often becomes essential as companies scale. [Securing the CFO seat of tomorrow: The moves that define future-ready finance leaders todayWhy I believe finance leaders need to rethink the role now Before I get into the bigger ideas, it helps to understand the context I come from, because it has shaped the way I think about finance leadership. I’m the CFO at Hitachi Vantara, a storage company and a![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-bf7dfaa8-546a-49d1-ad01-0ccf61020574.png)Finance AllianceTony Gonnella![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--25--678c637d-4121-4a80-b40c-d613e4cf07a4.png)](https://www.financealliance.io/securing-the-cfo-seat-of-tomorrow-the-moves-that-define-future-ready-finance-leaders-today/) ## **Does a company need both a CFO and CRO?** Most large companies have both roles, while small firms might only initially need a CFO. Here are signs it may be time to add a dedicated CRO: - Revenue growth is stagnating - Profit margins are shrinking - The sales team lacks cohesion and strategy - There are gaps in sales training and effectiveness - Sales forecasting is unreliable - Marketing and sales lack alignment The CFO vs CRO dilemma comes down to money versus sales. The CFO manages cash flow while the CRO boosts the top line. Both contribute immense strategic value, making these two roles indispensably important in any growth-oriented company. --- ### FAQs: CFO vs CRO What is the meaning of CRO? CRO is an abbreviation that most commonly stands for Chief Revenue Officer. The Chief Revenue Officer is an executive role focused on driving sales growth and boosting revenue for a company. However, CRO can occasionally also stand for Chief Risk Officer. The Chief Risk Officer oversees risk management strategy and policies for an organization. They identify and mitigate key business risks. What is another name for a Chief Revenue Officer? Another common name for a Chief Revenue Officer is Chief Sales Officer. Who is responsible for revenue in a company? The Chief Revenue Officer (CRO) is responsible for revenue in a company. The CRO leads sales and revenue growth strategies. What is a CFO responsible for? A CFO is responsible for overseeing accounting, cash flow, budgeting, financial reporting and planning, financial analysis, and risk management. The CFO manages the financial operations. What's the best CFO-CRO reporting structure? Most companies have the CFO and CRO report directly to the CEO. This enables direct communication at the executive level. But some organizations have the CFO report to the CEO and the CRO report to the CFO. There are pros and cons to each structure. Can the CFO and CRO ever be the same person? Yes, but it's extremely rare for one executive to effectively handle both the CFO and CRO role. The breadth of responsibilities usually demands two specialized leaders. ### Artefacts are not reporting tools. They're decision architecture. URL: https://www.financealliance.io/artefacts-are-not-reporting-tools/ Last updated: 2026-06-03T09:13:43.000Z ***A follow-up to*** [***my piece on the F-PRA framework***](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/) ***for robust planning, budgeting, and forecasting.*** In my earlier article on building robust Planning, Budgeting, and Forecasting (PBF) processes, I introduced the F-PRA framework: Foundation, Philosophy, Rituals, and Artefacts. The first three elements tend to attract the most attention. Leaders debate governance structures, [planning](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/) philosophy, process calendars, and system architecture. Artefacts, by contrast, are treated as an afterthought. They are seen as the visible outputs of the process: the dashboard, the board deck, the [forecast](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) template, the variance report, the monthly business review pack. That view is understandable, but it fundamentally misreads what artefacts actually do. Artefacts are not merely the outputs of a planning process. They are the mechanism through which an organization interprets performance, surfaces [risk](https://www.financealliance.io/risks-of-mergers-and-acquisitions/), allocates attention, and makes decisions. In that sense, they are not [reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) tools. They are decision architecture. And they deserve to be treated as a core FP&A capability. [FP&A career path and salary guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-24db5e46-a775-47b8-b098-995efeedeade.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--10--629fb1a8-9577-48e5-8776-a04906b1d1d5.png)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) ## **The real problem: Most artefacts are designed for information transfer** Most finance artefacts are built around a single objective: [communicate](https://www.financealliance.io/stakeholder-communication-plan/) information. - What happened? - How did actuals compare to plan? - Which [metrics](https://www.financealliance.io/32-cfo-kpis/) are above or below target? - Where are the risks and opportunities? These are important questions. But they are only the starting point. The deeper purpose of an artefact is not to transfer information. It is to shape judgment. That distinction matters enormously. - **Information transfer** asks: *What should the audience know?* - **Decision architecture** asks: *What should the audience do differently after seeing this?* Many artefacts fail because they answer the first question and ignore the second. They are accurate, comprehensive, and professionally produced, but they do not help leaders make better decisions. Executive teams leave planning meetings with a strong understanding of the numbers but without a clear decision, intervention, or change in direction. The artefact informed them. It did not move them. ## **A framework for better artefact design: Four layers** A practical way to improve artefact design is to think across four layers. Most organizations overbuild the first and significantly underbuild the other three. ### **Layer 1: Signal — What deserves attention?** The first job of an artefact is to direct attention. This sounds simple. It is where most artefacts fail. Dashboards become crowded with [KPIs](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) because every function, region, or business unit wants its metric represented. The result is not transparency. It is signal dilution. When everything is visible, nothing is prominent. I worked with a consumer goods company that had built an impressive integrated reporting platform covering over eighty metrics across its commercial divisions. In practice, every monthly business review opened with a twenty-minute walkthrough of numbers that no one disputed, leaving almost no time for the two or three items that required an actual decision. **The artefact was technically complete. It was operationally useless.** [How finance is evolving from reporting to innovationIs your finance team seen as a roadblock? Discover how to evolve finance from a cost center to a strategic driver of innovation and growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-45927a5b-dfd4-45d9-a906-30c62b57f809.png)Finance AllianceSiqi Chen![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--80298870-8ceb-4fd6-8095-b420cf7c6f3f.png)](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) Good artefacts are intentionally selective. They distinguish between: - **What needs to be monitored** (operational dashboards) - **What needs to be discussed** (functional reviews) - **What needs to be decided** (senior leadership forums) The design question is not *“Can we show this metric?”* It is *“Will showing this metric improve the decision?”* ### **Layer 2: Interpretation — What does the signal mean?** Once attention is focused, the next layer is interpretation. This is where [FP&A](https://www.financealliance.io/secure-by-design-fp-a-automating-planning-without-expanding-the-fraud-surface/) can create significant value, and where it most often falls short. A number by itself rarely tells leaders what to do. Good interpretation should answer three questions: 1. What changed? 2. Why did it change? 3. *Why does it matter now?* That third question is almost always missing. ****For example:** **“Gross margin declined 120 basis points due to unfavorable mix and input cost pressure”* is useful but incomplete. A more decision-oriented interpretation would say: **“Gross margin declined 120 basis points, primarily driven by mix shift in our fastest-growing channel. If this trend continues, the full-year margin target is unlikely without pricing action, portfolio intervention, or cost offsets.”* The second version does not just explain the number. It frames the management issue. This is where FP&A moves from [reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) performance to interpreting business reality. ### **Layer 3: Decision — What choice is required?** This is the most important layer and the most underdeveloped. Many artefacts present data, explain drivers, and summarize risks, but leave the actual choice unstated. Meetings become open-ended discussions. Leaders ask questions, teams provide explanations, and everyone leaves with a vague sense that the topic was covered. But coverage is not the same as [decision-making](https://www.financealliance.io/7-reasons-why-fp-a-professionals-miss-the-bus/). Every artefact used in a decision forum should make the decision requirement explicit. Specifically: - What decision is needed? - Who needs to make it? - What options are available? - What are the trade-offs between those options? - What happens if no decision is made? A forecast artefact should not merely indicate the business is trending below plan. It should clarify whether leadership needs to revise guidance, reallocate [investment](https://www.financealliance.io/multiple-on-invested-capital-moic/), reduce discretionary spend, adjust pricing, or accept the variance. A capital allocation artefact should not merely rank projects by return. It should clarify which projects should be funded, deferred, redesigned, or stopped. **If the artefact does not make the decision clear, the meeting probably will not either.** [How to transform financial data into compelling storiesFP&A professionals have to understand the business deeply. We’re not just reporting results or explaining variances. We are taking on part of the decision-making burden.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-951a0f68-893a-4c97-932e-260d61354a0c.png)Finance AllianceLewis Danby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--5--ee3b28d5-3187-4b21-8479-b1f25af435d6.png)](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) ### **Layer 4: Accountability — Who owns the outcome?** The final layer is where artefacts become management mechanisms. Many planning processes suffer from what I think of as “distributed ambiguity.” Everyone is involved, but ownership is unclear. Sales owns the volume assumptions. Finance owns the model. Operations owns capacity. But when the forecast misses, no one clearly owns the gap. Strong artefacts reduce this ambiguity by [embedding accountability](https://www.financealliance.io/when-should-you-actually-trust-ai-in-a-finance-decision/) directly into the design: - Who owns each major assumption? - Who is accountable for each intervention or action? - Which risks are being monitored, mitigated, or escalated, and by whom? This is particularly important in rolling forecast processes. Without clear ownership, the forecast becomes a finance-owned consolidation exercise rather than a business-owned view of expected performance. [How to forecast inventories as an FP&A pro so that you balance working capital and growthForecasting tells you expected demand. But you must plan for uncertainty. Use safety stock to guard against demand spikes and supplier delays.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-33b6b55b-fb44-44a8-969c-c8f507f8fb80.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Asaf-Masani---Forecasting-inventories-as-an-FP-A-pro-97fd04e8-76db-4aa7-99f7-52f6396f4dca.png)](https://www.financealliance.io/how-to-forecast-inventories/) ## **The standardization tension: Grammar vs. sentences** One of the hardest questions in artefact design is how much to standardize. Standardization improves comparability, reduces cognitive load, speeds up reviews, and supports governance discipline. But over-standardization forces different businesses into the same template regardless of their economics, suppresses nuance, and encourages teams to fit reality into the format rather than surface what actually matters. **Standardize:** - Core metric definitions - Decision rights and escalation thresholds - Forecast submission requirements - Risk and opportunity classification logic **Allow flexibility in:** - Business narrative and context - Market-specific risks and strategic choices - Supporting analysis depth and format In other words: ***standardize the grammar, not every sentence.** One European financial institution I worked with enforced near-total artefact standardization across business units. Reviews were faster, governance was cleaner, and escalation paths were unambiguous. The trade-off was that nuance occasionally got lost. For that organization, with its governance structure and risk profile, that was an acceptable trade. Most organizations would benefit from a more balanced approach. ## **Designing for uncertainty, not false precision** A common artefact failure that deserves its own mention is false precision. PBF processes routinely produce exact numbers in situations where underlying reality is highly uncertain. A forecast that shows revenue of $4.82 billion and [EBITDA](https://www.financealliance.io/ebitda-calculator-guide/) of $897 million looks rigorous. In a volatile environment, it may simply be misleading. Better artefacts make uncertainty explicit by using: - **Ranges** rather than point estimates wherever appropriate - **Scenario framing** tied to specific business conditions or external triggers - **Sensitivity tables** showing which assumptions most affect the outcome - **Explicit conditions** for what would need to be true for the forecast to hold This changes the quality of the discussion. Instead of asking “Is the forecast right?” leaders can ask “What conditions would cause this forecast to break?” and “What actions preserve our options across scenarios?” That is a more useful conversation, and it reflects what forecasting is actually for. [How I’m thinking about AI after 27 years in financeAfter 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-a8e2f97c-4220-49d9-9101-d24ad5cdef78.png)Finance AllianceGeeta Malhotra![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--745d083a-fe5e-48d7-b475-770e501cb213.png)](https://www.financealliance.io/ai-in-finance-business-strategy/) ## **A practical checklist before any senior forum** Before an artefact goes into a senior leadership discussion, [FP&A leaders](https://www.financealliance.io/fp-a-team-structure/) should be able to answer yes to each of the following: - Does it make the critical signal obvious? - *Does it explain why that signal matters now?* - Does it identify the decision required and by whom? - Does it clarify the options and trade-offs? - Does it assign clear ownership of assumptions and actions? - Does it reflect uncertainty honestly rather than implying false precision? - Does it reduce rather than increase cognitive burden? - Does it encourage the right behaviors in the people who use it? If the answer to any of these is unclear, the artefact is not ready. And more often than not, the issue is not the underlying data. It is the design. ## **Artefacts shape how organizations think** The planning process does not fail because the calendar is wrong or the model is weak. More often, it fails because the artefacts do not convert information into action. *A strong artefact should not merely answer: What happened?* It should help the organization answer: - What matters? - What does it mean? - What should we do? - Who owns it? - When will we know if it worked? When artefacts are designed with that intent, they stop being passive reports. They become the operating system for better decisions. And that, ultimately, is what FP&A is there to enable. ***This is part of an ongoing series on building robust PBF processes. Feedback, challenges, and real-world examples are always welcome.*** ### The AI-first finance team: How to build finance tools without engineering [OnDemand] URL: https://www.financealliance.io/how-to-build-finance-tools-without-engineering/ Last updated: 2026-07-22T18:14:29.000Z For decades the finance team's choice was binary: buy off-the-shelf software, or wait six months for engineering to build something custom. **AI collapsed that choice.** Finance and accounting teams are now shipping their own tools in days, not quarters - and the question has shifted from *"what should we buy?"* to *"what should we build?"* In this session, hosted in partnership with Ramp, three operators leading the shift walk through exactly what they've built, how they built it, and the framework they use to decide what to vibe-code versus what to leave to a vendor. --- ### **What you'll walk away with** - A practical build-vs-buy framework for 2026 - where building yourself wins, and where SOC compliance, audit trails, and vendor intelligence mean buying is still the right call - Three real, deployed examples of AI-built finance tools (hoteling, procurement intake, close management) with the prompts and scripts to recreate them - A working understanding of "vibe coding" - what it is, what it isn't, and why finance is one of the best functions to apply it in - How the finance and accounting roles are reshaping around AI fluency, and the new archetypes (Finance AI Lead, Strategic Accounting Ops) emerging at AI-native companies - Templates and scripts you can adopt into your own stack the same day --- ### **The problems we're solving** ***"Month-end close is a 20-day exercise in chasing visibility we should already have."*** When spend, contracts, and approvals live in separate tools, you find out what happened weeks after it happened. You'll see the lightweight tooling that closes the gap without an ERP migration. ***"We're a lean team being asked to scale without adding headcount."*** The old playbook said hire. The new playbook says build. You'll see what to automate first and what's not worth your time. ***"Contract review is eating my week, but Legal is six months out."*** AI contract review isn't a future state, it's a working tool already running inside Ramp. You'll see the prompts and the workflow. --- ### Meet the speakers [**Brock Beyer**](https://www.linkedin.com/in/brockbeyer/) **\-** *Controller, Jump* Brock is the Controller at Jump, the AI operating system for financial advisors, and a CPA who went from zero coding experience to building deployed finance tools in three months. As Jump's first accounting hire, he's taken an AI-first approach to scaling the back office through vibe-coded apps for hoteling, procurement, and close management. [**Stephen Hedlund**](https://www.linkedin.com/in/stephenwhedlund/) **\-** *Head of Finance, Rillet* Stephen leads finance and marketing at Rillet, the AI-native ERP rebuilding financial infrastructure for the modern era. He's deep in Claude Code, building custom tools like a 13-week cash forecast in about an hour, and is currently leading a multi-city AI coding roadshow for finance professionals. [**Dave Wieseneck**](https://www.linkedin.com/in/davidwieseneck/) **\-** *Expert in Residence, Ramp* Dave sits at the intersection of finance and product at Ramp, building and prototyping what modern AI-powered finance operations look like. He's a frequent host of Ramp's live sessions and recently vibe-coded internal tools including an AI contract reviewer and a Slack-native image generator. **In partnership with:** [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/06/Ramp_Business_Corporation_Logo.svg.png)](https://ramp.com/) ### AI-Powered Finance Summit 2026 URL: https://www.financealliance.io/ai-powered-finance-summit-2026/ Last updated: 2026-06-01T15:24:57.000Z Catch up on all sessions from AI-Powered Finance Summit 2026, feautring sessions from Adobe, Meta, Visa, and more. _This post is for paying subscribers only._ ### From AI curiosity to finance capability: Building a function that scales with intelligence URL: https://www.financealliance.io/rethinking-finance-teams-for-the-age-of-ai/ Last updated: 2026-06-19T08:56:03.000Z When people [talk about AI](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/), I hear a lot about [tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/). I hear about the latest platforms, the newest agents, the next implementation, the newest feature inside an ERP system, or the promise that one more product is going to transform everything overnight. What I don't hear enough about is capability. I don't hear enough about where people actually are in this process, whether [teams](https://www.financealliance.io/how-to-optimize-finance-teams/) are prepared to use these systems effectively, or how organizations move from curiosity about AI to meaningful operational transformation. That gap matters. If I were standing in front of a room of [finance leaders](https://www.financealliance.io/how-cfos-power-business-strategy/) and asked how many genuinely feel their finance organizations are ready to implement AI effectively into workflows, very few hands would go up. That hesitation is real, and it reflects what many of us are seeing inside our own organizations. According to research from the AICPA, 88% of CFOs believe AI will be transformational. Yet only 29% believe their teams are ready. That difference between belief and readiness is where the real work lives. I have spent my career leading transformation across industries, from aerospace to service organizations and digital publishing. Today, I work in a mission-driven organization that provides digital services for media and publishing. Across all of those experiences, one thing has remained true: technology alone does not create transformation. [People do](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/). AI is no different. [How generative AI is transforming financeFinancial advisors could use AI to generate initial investment recommendations while focusing their expertise on understanding client needs and providing personalized guidance.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--9--1f754b9c4dfb3f7dc1e0464e561b90aef965f7cbf16aaf497aedd4d421ab4df4.png)](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) ## **The problem is not access to tools** Most organizations already have AI entering their systems in some form. If I talk to our chief digital officer, he will point out that AI has existed in products like Outlook for years. Traditional AI absolutely has. But [generative AI](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) changed the conversation, and now we are moving into AI agents and increasingly sophisticated systems that evolve at extraordinary speed. The reality is that the major vendors are already embedding these capabilities into finance products. NetSuite is introducing agents. Salesforce is introducing agents. SAP is introducing agents. Nearly every major provider is integrating AI functionality directly into the systems finance organizations already use. That means the issue is no longer whether the tools exist. The issue is whether teams know how to use them intentionally and consistently. What concerns me most is inconsistency. If different people use the same tools differently, you can end up with different outputs from the exact same data. You can have three people reach three different conclusions because they approached the system in different ways or interpreted the information differently. That's not transformation. That's [operational risk](https://www.financealliance.io/risks-of-mergers-and-acquisitions/). When organizations skip over capability-building and go straight to implementation, they create environments where outputs become unreliable, trust erodes, and ROI suffers. And that's one of the biggest reasons so many AI initiatives struggle to demonstrate value. [How I’m thinking about AI after 27 years in financeAfter 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceGeeta Malhotra![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--ecb8675b7fb6e5981652837ac075f1c0a32ddb3f560c23a73ca783f84bedfb9e.png)](https://www.financealliance.io/ai-in-finance-business-strategy/) ## **Why training matters more than most leaders realize** One of the things I find frustrating in conversations about AI is how casually training is often treated. Someone will spend an hour discussing technology [strategy](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/), implementation timelines, vendor partnerships, and automation opportunities, and then training becomes a single sentence at the end of the [presentation](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/). “Oh, and make sure you train your teams.” That's nowhere near enough. Some organizations attempt experimental training where people casually explore tools on their own. That approach works reasonably well for early adopters because those individuals are [naturally curious and motivated](https://www.financealliance.io/how-to-become-a-fractional-cfo/). But it does not create consistency across an organization. You cannot build an effective finance function on inconsistent usage patterns. Training is what creates trust. Training builds the shared understanding that allows teams to [interpret data consistently](https://www.financealliance.io/mastering-data-storytelling/), apply judgment appropriately, and understand where human oversight is still essential. Vendors can help with this. Companies like Microsoft and NetSuite provide training around their products. There are external providers as well, although I have personally found much of the external training market underwhelming. Too often, the training feels more like marketing than capability-building. Organizations can also attempt to create training internally, but that only works when there is enough expertise and structure to support it. Even then, training alone is not enough. Training builds skills, but it does not automatically embed AI into the daily work people perform. That requires something deeper. [How finance certifications can boost your earning power in 2026Organizations increasingly expect finance teams to be proactive partners in shaping strategy, not just reactive record-keepers.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--4--6975f3a329572c9b96f3d80374865067894eca866183b36cefd48e1d865b9966.png)](https://www.financealliance.io/finance-certifications-can-boost-your-earning-power/) _This post is for paying subscribers only._ ### How I’m thinking about AI in business strategy after 27 years in finance URL: https://www.financealliance.io/ai-in-finance-business-strategy/ Last updated: 2026-05-26T07:48:46.000Z After nearly three decades in [finance](https://www.financealliance.io/17-finance-business-processes/) and [accounting](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/), I found myself back in the classroom; not because I needed another degree, but because I needed a new lens. Recently, I completed my master’s degree in AI Strategy at Oxford, alongside a postgraduate certification in Sustainability from Cambridge. After 27 years spent building finance and accounting capability centers across India, Guatemala, Mexico, Poland, and beyond, I realized that the world I’d helped shape was changing faster than our traditional playbooks could keep up. [Artificial intelligence](https://www.financealliance.io/ai-in-fp-a/) isn’t just another technology wave. It’s a paradigm shift in how we define and deliver value. My world has always revolved around numbers; revenue, margin, and cash. But AI has made me rethink what drives those numbers in the first place. And the conclusion I’ve reached is simple but profound: AI is not the thing to chase. Value is. [How FinTech is being empowered with AI & analyticsIn this article, we’ll explore some of the most compelling AI and ML strategies in finance with use cases to show how they work in real-life scenarios.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-232.png)Finance AllianceAmit Kurhekar![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--1--2.png)](https://www.financealliance.io/fintech-and-ai/) ## **The confusion around AI is real, and that’s okay** When I speak to professionals (from CFOs to students to people I meet on the street) the reactions to AI couldn’t be more different. Some say, “It’s the next electricity!” Others whisper, “It’s too risky; I’ll stay away.” That confusion is understandable. We’ve lived through hype cycles before. I remember when RPA (Robotic Process Automation) was supposed to change the game. It helped, but it didn’t revolutionize the business. So, it’s natural to ask whether AI will be any different. The questions I hear most often are the same ones I had myself at first: - Is AI truly transformative, or is it another overhyped buzzword? - Should I be concerned about losing control? - How will I explain AI-driven decisions to my auditors? - What value will it create for me and my organization? - And how do I even begin? The truth is, these are exactly the right questions to ask. They signal healthy skepticism, the kind we need before embarking on any strategic transformation. ## **Why I chase value, not AI** For me, AI only matters when it creates value. I’m not interested in chasing technology for technology’s sake. As finance professionals, our North Star has always been value creation, and that always comes down to revenue, margins, and cash. Take accounts payable, for example. It may not sound glamorous, but it’s central to every organization. I still remember an Avon CEO running after me in the corridor to ask why suppliers in the UK hadn’t been paid. That moment stayed with me; it was a reminder that finance operations touch everything. When I look at AI in AP, the question isn’t, “Where can I use AI?” but “What value am I trying to unlock?” If a company is struggling with working capital, I think about how AI can optimize payment timing. If the problem is margin compression, maybe AI can help identify discount opportunities faster. If the concern is risk, perhaps AI can catch duplicate or fraudulent payments before auditors do. At Avon, for example, millions of dollars were lost in a bribery case detected through the AP process. It showed me that controls, and the technology that supports them, are not optional. They’re central to trust and sustainability. So yes, I use AI. But I don’t chase AI. I chase value, and I let value determine how and where AI fits in. ## **The three components of AI: data, computing, and people** When I think about AI, I think in three parts: [data](https://www.financealliance.io/using-chatgpt-for-data-cleaning/), computing, and people. **Data** comes first. AI is a massive data guzzler, and without quality data, you’re simply building castles in the air. I’ve seen too many companies jump straight to algorithms without fixing their data foundation: issues like accuracy, labeling, [privacy](https://www.financealliance.io/finance-and-compliance/), and accessibility. Before you go chasing the shiny promise of AI, you have to roll up your sleeves and clean your data. That’s where I always start. **Computing**, on the other hand, is becoming cheaper by the day. With open-source platforms and the abundance of [cloud computing](https://www.financealliance.io/from-transactions-to-insights-the-role-of-cloud-powered-analytics-in-redefining-e-commerce-finance/), this is not where finance leaders need to focus their time. Which brings me to **people**, the most important component of all. Every transformation, from automation to digital, has ultimately been about people. AI is no different. If my team isn’t equipped, if they don’t understand their new roles in an [AI-driven](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) environment, then the transformation will fail, no matter how good the technology is. The concept of “human in the loop” is more than a buzzword. It means new responsibilities, new skills, and new ways of working. [Reskilling](https://www.financealliance.io/top-10-cfo-skills/) isn’t optional; it’s critical. And it starts with leadership. If I don’t understand what AI is enabling in my function, how can I expect my team to? ## **Thinking in years, not months** AI is a [long-term transformation journey](https://www.financealliance.io/driving-digital-transformation-in-finance/). Just like any major change program, it unfolds over years, not quarters. That’s why I tell every finance leader: if you’re clear on the value you’re chasing, your narrative, your KPIs, your team alignment, and your executive buy-in will follow naturally. But if you start by chasing the technology, you’ll lose your way. Like any significant transformation, AI requires clarity of purpose, structured change management, and sustained commitment from the [C-suite](https://www.financealliance.io/chief-investment-officer-vs-chief-financial-officer/). It’s not an app you install, it’s a culture you build. ## **The ethical reality of AI** No conversation about AI is complete without discussing ethics. One of the most striking lessons I’ve learned came from revisiting Microsoft’s Tay chatbot experiment in 2018. Ten years of development and investment gone in twenty-four hours. Tay was released on [social media](https://www.tiktok.com/@financealliance), learned from public interactions, and within a day became racist and sexist. Microsoft had to pull it down immediately. Then there was the U.S. justice system’s algorithm designed to predict repeat offenders. It ended up discriminating against people of color. Amazon’s hiring AI, trained on years of male-dominated hiring data, automatically rejected women’s CVs. These are not anomalies, they’re warnings. AI reflects the data we feed it. If that data is biased, the results will be too. I recently had a fascinating conversation with a financial controller friend who uses ChatGPT every morning. He treats it like his [assistant](https://www.financealliance.io/copilot-vs-claude-for-excel-which-ai-assistant-wins-for-formula-building/), but one day he caught it fabricating risk information about Nestlé’s financial statements. When he confronted it, ChatGPT admitted it was making assumptions based on global warming and supply chain risks. His response was brilliant: he trained it to stick only to facts. That mindset of accountable experimentation is exactly what we need. You can’t say “the algorithm did it.” Someone must own the outcome. That’s what responsible AI leadership means to me: curiosity balanced with accountability. [How AI is transforming financial modeling & sales forecasting in enterprise techThis article explores how AI is transforming financial modeling and sales forecasting (two pillars of enterprise strategy) and helping finance teams shift from reactive to proactive operations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-234.png)Finance AllianceSupreeth Meka![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--56--2.png)](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) ## **What’s really happening inside finance organizations** When I look across industries, I see vastly different levels of AI maturity. At one end of the spectrum are large [global financial services firms](https://www.financealliance.io/fp-a-salary-and-career-path-guide/), some with more than $50 billion in annual revenue, saying, “AI isn’t new, and it’s not our priority. We already have Copilot.” Many have yet to run substantial pilots or build cohesive strategies. At the other end are organizations where the CEO is personally leading the AI agenda. One [investment bank](https://www.financealliance.io/ai-in-risk-management-how-banks-can-mitigate-fraud-and-financial-crimes/) I spoke with recently hosted a company-wide AI summit for senior leaders. They’ve made it a strategic priority, with a formal AI roadmap launching this year. Their focus areas are crystal clear: - [Data and analytics](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/), not just transactions. - ESG reporting, where most of the data exists outside their direct control. - Automation of repetitive finance tasks, like daily P&L and journal accruals. And then there are smaller companies (service firms or private organizations) experimenting at the edges. One CFO pushed to implement ChatGPT for vendor help desk support simply because of FOMO. Another firm, with less than $1.5 billion in revenue, admitted they were too busy with day-to-day operations to even start. This contrast reveals a simple truth: companies that chase systemic value through AI see results; those that chase point solutions rarely do. ## **Data, privacy, and the need for control** Another critical concern that keeps surfacing is data privacy. In one discussion, a company’s CEO was using a meeting transcription tool to automatically summarize two-hour conversations. It seemed like a dream until the data team raised alarms about where the recordings were being stored. I completely agreed with their caution. You need to know where your data is going, who has access to it, and how it might be used. That awareness is not paranoia, it’s good governance. AI doesn’t erase the need for internal controls; it magnifies it. Our classic finance instincts (verification, validation, reconciliation) still apply, just in new ways. When I think about the AI lifecycle, I see the greatest effort and risk management required at the data entry point where information first enters the system. Once poor data gets in, reversing the effects is costly and painful. Data integrity isn’t a back-office task anymore; it’s a strategic imperative. ## **People first: reskilling as the real transformation** Having spent years building global capability centers, I’ve learned that technology doesn’t transform organizations, **people do**. Every major finance transformation I’ve led or witnessed succeeded because of teams who embraced change. The same is true for AI. If my people don’t understand what happens after AI is deployed, they won’t play the ball. That’s why I focus heavily on **reskilling and** [**knowledge programs**](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters). Roles change, responsibilities shift, and expectations evolve. Finance teams must learn not only to interpret AI-driven insights but to question and guide them responsibly. I’ve watched BPOs like Genpact deploy AI-driven knowledge engines to upskill tens of thousands of employees. That’s what scaling looks like: [embedding AI into human capability, not replacing it](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/). ## **How I see AI being implemented in practice** AI deployment, in my experience, works best when co-created between internal teams and partners who understand both [technology](https://www.financealliance.io/why-black-box-ai-is-failing-fp-a-and-what-to-use-instead/) and domain. In BPO environments, I’ve seen companies start with infosearch and chatbot applications, because they leverage structured data that’s already well-governed. These quick wins build momentum and trust. From there, they expand into more complex analytics, [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), and scenario modeling. When it comes to choosing between building your own AI or using [AI-enabled finance tools](https://www.financealliance.io/10-best-financial-modeling-tools/), my advice is simple: start with what’s proven. If an existing F&A tool already has AI built in (and its ethical and privacy frameworks are established) use that as your sandbox. You’ll get early wins without unnecessary risk. Later, when your organization matures, you can consider building custom solutions from the ground up. Experimentation is good. Recklessness isn’t. ## **How finance leaders can approach AI strategically** For finance leaders wondering where to begin, I’d recommend three steps that have worked for me: ### **1\. Understand your organization’s strategy** If your CEO or board isn’t yet focused on AI, don’t go rogue. Start with change management: educate, align, and build awareness. [Transformation](https://www.financealliance.io/key-trends-shaping-the-future-of-finance/) without leadership buy-in is wasted effort. ### **2\. Define the enterprise value clearly** Be explicit about what you’re chasing: working capital efficiency, margin expansion, risk mitigation, or something else. When value is clear, priorities follow. ### **3\. Secure funding and ensure process maturity** AI thrives on structure. If your core processes are inconsistent, fix those first. Then layer in AI where it can amplify outcomes. It’s never about deploying AI for the sake of novelty. It’s about connecting technology to the organization’s [strategy](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/) and maturity level. ## **The long view: AI as a transformation journey** I often remind my teams and peers that AI is not an endgame, it’s an evolution. Some BPOs are already projecting **15–25% productivity gains** from generative AI over the next two to three years. That’s impressive, but it’s only the beginning. Real transformation happens when AI becomes invisible, when it’s woven seamlessly into [decision-making](https://www.financealliance.io/mckinsey-7s-model/), when data flows freely, and when humans and machines collaborate without friction. For me, after 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash. The tools have evolved, but the mission remains the same. --- *This article is based on Geeta Malhotra's brilliant talk from our CFO Summit.* ### Navigating the trifecta: Growth, sustainability & compliance URL: https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/ Last updated: 2026-05-26T08:13:34.000Z In finance, it’s easy to get caught up in numbers alone, but what really drives [sustainable](https://www.financealliance.io/7-benefits-of-esg-investing/) growth is the discipline behind how we make decisions and the way we adapt to change. Over the past few years, our business has expanded rapidly across Europe, adding channels, scaling streaming platforms, and building new partnerships, yet every move we’ve made has been anchored by a simple principle: if it isn’t profitable in year one, we don’t do it. That mindset has shaped how we negotiate, how we innovate, and how we use technology. Automation has already transformed the way we operate, freeing people from manual processes so they can focus on analysis and [strategy](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/). And now, with artificial intelligence racing ahead faster than regulation can keep up, [finance](https://www.financealliance.io/) has an even bigger role to play, not just in approving the numbers behind an idea, but in ensuring the business understands the risks, the ethics, and the opportunities of what comes next. In this article, I want to share the lessons we’ve learned on balancing growth with financial discipline, how [automation and AI](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) are reshaping the finance function, and why upskilling our people is the key to staying relevant in an unpredictable world. [Driving innovation: From CFO “no” to strategic growth partnerDiscover how finance teams can drive innovation, not block it. Learn how strategic finance leaders enable growth through risk-balanced decisions, scenario planning, and capital allocation frameworks.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-05f65a71b59a3fd705bedfbc0cff100d007fe074490e4f16822e844cb2310c8f.png)Finance AllianceKevwe Ijatomi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--0bce575228d2eac33500abc032d66b87bdbce6f5b2480bad2ba4b262c2f6dad0.png)](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) ## **Growth in Europe: A finance-driven approach** Our European business has been almost three decades in the making. What started in 1995 with a single TV channel in the UK has grown into a portfolio of seven channels reaching diverse audiences - from the South Asian diaspora to German, English, and Nordic viewers. Alongside this, we’ve built our own streaming platform, ensuring we’re present across every distribution model: free-to-air, paid channels, and apps. By the mid-2000s, we had already reached all Asian households in our footprint. Expansion from there meant rethinking our approach. The key was localization - dubbing and subtitling our content into local languages so we could reach wider mainstream audiences. That decision has been pivotal in establishing us as the largest South Asian broadcaster and content aggregator in Europe, now reaching 40–45 million households. From a financial perspective, our strategy has been simple but firm: no project moves forward unless it shows profitability in year one. In an industry saturated with content (Netflix, Amazon Prime, and countless others) that discipline is essential. Our programming and marketing teams must demonstrate clear returns before any launch. That rigor has driven nearly 80% top-line growth in just the last three to four years. Equally important has been the way we manage partnerships. With platforms like Samsung, LG, Sky, Virgin, and Vodafone, our approach has always been transparent and grounded in fair margins. If our cost is $100, we ask for $122 (not $300) because the target is a 22% gross margin. That honesty has consistently secured favorable deals and strengthened long-term relationships. It’s a reminder that finance isn’t just about numbers on a spreadsheet; it’s about building [trust](https://www.financealliance.io/when-should-you-actually-trust-ai-in-a-finance-decision/) that creates value for both sides. ## **The impact of artificial intelligence** The last three years have seen an explosion of artificial intelligence products from the world’s largest tech companies like Google, Meta, Microsoft, and others. Some have worked, many have not, but the sheer speed of development is overwhelming. ChatGPT was released in late 2022, and by 2024, the pace of change is still faster than most of us can realistically absorb. From my perspective, that speed is both exciting and unsettling. The challenge isn’t [whether AI will reshape our industries](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/) because it already is, but whether humans and businesses can adapt quickly enough to keep up. That uncertainty is what makes it feel, at times, a little scary. Rather than waiting for clarity, we’ve focused on applying AI tools where they can create real impact in media and entertainment. With 150 TV channels worldwide, a streaming platform in 190 countries, and hundreds of millions of active users, the opportunities are vast. But so are the responsibilities. Operating in regulated markets like the UK and Europe means we must ensure [compliance](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/), whether it’s avoiding inappropriate advertising before 9 p.m. or managing content standards. AI and automation play an important role in helping us meet those obligations. [Guide to building stronger cross-functional relationshipsWant to know how finance can build stronger cross-functional relationships? Read this blog to learn more.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-196.png)Finance AllianceKavin Soni![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--75-.png)](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/) ## **Automation in broadcasting** In fact, our automation journey started long before AI became a buzzword. Between 2011 and 2014, we rebuilt our systems so that compliance checks and back-office processes could run seamlessly without manual intervention. Today, from the moment a sales contract is signed to the point an invoice is issued, everything is automated. I often say that AI is just automation with a new name. You tell the system what to do, and it does it. What matters is the value it creates. For us, [automation](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) has reduced errors, accelerated turnaround times, and freed finance teams to focus on analysis instead of administration. Crucially, there were no job losses. Instead, our people upgraded and upskilled themselves to work with the new systems. That shift has been one of our biggest successes, not only in making operations more efficient but in proving that technology and people can grow together. ## **Innovations in streaming services** Our streaming platform has become a testbed for applying AI in ways that directly enhance user experience. One project we’re working on is a chatbot integrated into the app. Imagine asking, *“What time is Britain’s Got Talent airing?”* and getting an instant, accurate response. That’s the type of user-friendly capability we’re building. Unlike broadcast TV, where platforms like Sky or Virgin control the interface, our streaming apps give us the freedom to innovate. And importantly, finance is deeply involved in every step of this process. No idea moves forward just because it sounds exciting; it must be backed by clear financial projections. We ask: - How many users will engage with the feature? - What’s the revenue potential? - How can sales teams monetize it effectively? Every innovation is vetted through this lens, ensuring that new features deliver both a better user experience and measurable business value. [How finance is evolving from reporting to innovationIs your finance team seen as a roadblock? Discover how to evolve finance from a cost center to a strategic driver of innovation and growth.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSiqi Chen![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--58ad4c46c79907ed3933db9face44dc796c475f14c80e2828040854e6a4cb42b.png)](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) ## **Trends in AI adoption** AI adoption is advancing at different speeds across industries. Computing companies lead the way, while service industries lag behind; and the reasons are obvious. In tech, faster development is a competitive necessity, while service businesses are still grappling with how to apply these tools effectively. Key trends worth noting: - **Rapid uptake in computing**: Developers use AI to accelerate coding, with humans overseeing quality rather than writing every line themselves. - **Slower progress in services**: Adoption is constrained by regulatory, ethical, and practical challenges. - **Massive investment ahead**: AI spending is projected to hit around $100 billion globally in the next three to four years, with potential to grow even higher. - **Opportunity for enablers**: Service and consulting companies (especially those developing tailored AI tools) are poised to capture significant value as demand scales. For finance leaders, the message is clear: AI investment isn’t slowing down. The real question is how to position your business to take advantage of these shifts, while balancing [risk](https://www.financealliance.io/risks-of-mergers-and-acquisitions/), regulation, and return on investment. ## **AI as automation** When I look at artificial intelligence, I see it first and foremost as automation. Invoices, reports, reconciliations - these are already being handled by systems. AI is simply the next step in asking a system to do what we once did manually. At its core, it’s not magic; it’s automation with greater speed, scale, and adaptability. What excites me is the potential to bring that same immediacy we experience in our personal lives into finance. When a breaking news alert flashes on your phone, you don’t wait until the evening to catch up, you see it instantly. Why shouldn’t business performance updates work the same way? Imagine a notification that says, *“Breaking news: sales target achieved,”* or *“Cash flow alert: variance detected.”* That’s what we’re building - an internal app that pushes real-time updates to decision makers. Today, it shows up in our dashboards; soon, it will live on our mobiles. For CFOs and [finance teams](https://www.financealliance.io/how-fp-a-teams-build-budgets-and-how-you-can-nail-this-in-interviews/), this could be a genuine game changer. [Driver-based forecasting for FP&A to align strategy with realityIf you haven’t tried driver-based forecasting for FP&A, this is your chance to really align your strategy with reality.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-197.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--73--1.png)](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/) ## **Center of excellence for innovation** To take this further, we created a center of excellence in Bangalore - what we like to call our “center of innovation.” Its purpose is simple: bring together data and people across all departments, not just finance, and turn complexity into clarity. In media and entertainment, no two days are alike. A program that succeeds today may fail tomorrow, and business priorities can shift overnight. The center of excellence helps us stay ahead of that unpredictability by building [tools](https://www.financealliance.io/10-best-financial-modeling-tools/), processes, and modules that streamline workflows and accelerate decision making. It’s not only delivering value to the business as a whole but also equipping finance with the agility to respond faster, with better information, in a constantly changing environment. ## **Challenges in content prediction** Content performance is one of the most unpredictable aspects of our business. You can spend millions on a new show or film and still have no guarantee it will resonate with audiences. Everyone expected the latest *Lord of the Rings* series to be a blockbuster, yet it underperformed on Amazon Prime. On the other hand, some programs (like *Game of Thrones)* become cultural phenomena almost overnight. For finance teams, this unpredictability creates real challenges. A million-dollar episode that attracts only 10,000 viewers and half a million in revenue is a loss we must absorb. To manage this, we’ve built systems that continuously gather and analyze [performance data](https://www.financealliance.io/why-cfos-need-to-be-people-managers/), feeding it back into our planning and [forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/). It doesn’t eliminate the uncertainty, but it helps us quantify risk and make faster, better-informed decisions. [Why scenario modelling matters more in high-growth markets like AustinConversations around financial agility, capital efficiency, workforce planning, and scenario strategy are becoming increasingly important among CFOs and FP&A leaders operating in high-growth markets.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--28--2007b033b38f94418a01bfe6c6171309b73d9cdbde798dc192f8c66758eea9e8.png)](https://www.financealliance.io/why-scenario-modelling-matters-more-in-high-growth-markets-like-austin/) ## **Sales process improvements** On the sales side, we’re working to remove inefficiencies that slow down negotiations. In the past, a salesperson might be in the middle of a multimillion-dollar deal but still need to call a manager for discount approvals. With hundreds of clients, this created delays and uncertainty. We’re now developing [AI-driven](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) modules that benchmark deals and enable instant decision-making in the field. The idea is simple: - Salespeople get automated guidance on what level of discount is acceptable. - Approvals happen in real time, with notifications sent to managers and [finance teams](https://www.financealliance.io/how-to-optimize-finance-teams/). - The system tracks balances and revenue targets so we know immediately what needs to be covered elsewhere. This approach saves time for both our teams and our clients. Deals can be closed face-to-face without delays, reinforcing trust and demonstrating professionalism. While the system is still under development, I’m convinced this is the future of sales - a combination of human relationships supported by real-time data and finance oversight. ## **Global AI leadership perspectives** Looking at AI adoption globally, my personal view is that China will lead in implementation, followed closely by the United States. The sheer scale of companies, people, and processes in China gives them an advantage in speed and scale. India, meanwhile, will play a pivotal role as the engine room for software development and system integration. Companies like TCS and Infosys are already supporting global industries, from healthcare to media, and their expertise will ensure India remains central to building digital and AI-driven solutions for businesses worldwide. [When should you actually trust AI in a finance decision?The frame of “trust AI or don’t trust AI” is too simple. The better frame is: is this output ready to be acted on? That requires you to ask hard questions.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--26--74e02ca24a76482194616196c5a4855ad57ec7879989649660d73557992d4a39.png)](https://www.financealliance.io/when-should-you-actually-trust-ai-in-a-finance-decision/) ## **Waiting for accounting standards to catch up** One of the most interesting questions around AI isn’t technological, it’s regulatory. In finance, we can only move as fast as accounting standards allow. Whether it’s IFRS or GAAP, regulators will need time to decide how AI-driven processes should be treated. And because those standards apply across industries, from media to manufacturing, the response will take a broad, macro view. The question isn’t whether AI can consolidate accounts or generate regulatory reports, it already can. The real question is whether regulators will accept filings created by AI systems without human intervention. Should there always be a human in the loop? How will internal controls, ethics, and accountability be defined in an AI-driven environment? These are the areas where clarity is still missing. For now, we continue to rely on in-house systems to consolidate and report, even though AI could technically handle the entire process. We simply don’t have the regulatory green light. And until that comes, businesses everywhere will face the same wait. Strategically, partnerships like Nvidia’s with Reliance Media highlight how fast AI ecosystems are developing in India and globally. India, with its strength in software and systems implementation, will undoubtedly play a central role in shaping how these capabilities are built and deployed. But when it comes to financial reporting, no amount of innovation can bypass the need for clear, consistent, and fair standards that apply equally across industries. [What is a compliance report: A guide on compliance reportingA clear, no-fluff guide to compliance reporting for finance teams who do it all.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/compliance-report-blog-meta-2-50d77ef9f28509f9a94d062de69f2c53eefc93322d8ba0e2a2c92dac6fbdb7c6.png)](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) ## **Ethics in AI regulation** When regulators and accounting bodies eventually move to formalize the use of AI in finance, they won’t do it lightly. Any AI-based system or requirement will need to be thoroughly tested before a green light is given. The [tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/) already exist and companies are using them every day, but from an accounting standards perspective, the framework isn’t there yet. The challenge lies in defining how AI-driven processes fit within established principles of control, accuracy, and accountability. Some of the key questions regulators will have to address include: - **Human oversight**: Will filings produced by AI require a human sign-off, or can they stand alone? - **Internal controls**: How do we ensure checks and balances remain effective when entries are automated? - **Consistency**: Should automated transactions be treated the same way as AI-generated ones? - **Configuration risks**: If errors arise from system settings, who is accountable - the software, the business, or the individual? These are not trivial issues. For example, we already consolidate accounts through our in-house systems. Tomorrow, that same process could be managed by AI, but whether regulators will accept it without human intervention remains uncertain. Ultimately, AI doesn’t remove the need for governance; it just shifts the focus to new areas of risk and responsibility. For [finance leaders](https://www.financealliance.io/financial-leadership-in-changing-times-2/), the ethical dimension (ensuring fairness, transparency, and accountability) will be just as important as the technical capability. ## **Understanding AI hype in finance** There’s a lot of noise around artificial intelligence, but in many ways, it has been with us for years. Systems like SAP already generate reports, forecasts, and cash flows - functions that are, by definition, forms of AI. The question is not whether [AI exists in finance](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/), but which parts of it are genuinely transformative and which are simply hype. For finance leaders, the key questions are: is AI actually driving the business, and is it adding measurable value? If not, it may be a distraction rather than a solution. The same applies when evaluating new tools. Legacy systems like SAP are proven and secure, while many newer SME platforms are agile and innovative but raise questions around data protection and long-term reliability. These uncertainties must be weighed carefully before adopting any AI-driven solution. [What we’ll lose if we let AI take over finance (a cautionary tale)AI can crunch numbers, but it can’t build trust. Here’s what we risk losing if we forget the human side of FP&A.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceJay Dyer![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--6--57eebe1ae874fd560f62893647973920411698a8430b436048cc1c5c3acad746.png)](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/) ## **The need for upskilling in finance** Regardless of how the technology evolves, one thing is certain: finance teams cannot stand still. As automation takes over more transactional processes, the role of finance professionals will shift. Clerks and managers who once focused on ledgers and entries will need to move up the value chain. That means stronger analytical skills, greater business orientation, and the confidence to ask commercial questions, not just process invoices. Upskilling is no longer optional, it’s the only way to stay relevant. As leaders, we have a responsibility to support that journey, ensuring our people grow alongside the systems rather than being displaced by them. [Why human skills are the future of financeAs AI transforms finance, it’s not just about tech, it’s about people. Discover why emotional intelligence, curiosity, and leadership are the real future skills that will set you apart.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceDaniele Martins![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--61--a8939d1ab74c56b55a8de6b6b482f5a508a640f5ffdfdd776df8161b0767cb32.png)](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) ## **Beyond automation: Skills for a complex world** AI-driven software can project cash flows and estimate sales, but it cannot account for geopolitical shocks. Elections, wars, or sanctions can reshape forecasts overnight. We experienced this firsthand in Russia, where we reached 22 million households, only to shut down operations entirely when sanctions took effect. No algorithm could have predicted that. This is why finance professionals must go beyond processing numbers. They need to understand global events, recognize the business risks they create, and factor those into forecasts. There is no room for complacency. At the same time, automation has already eliminated much of the traditional accounting workload. We haven’t hired clerks for years because invoicing and ledgers are fully automated. Instead, we’ve focused on [upskilling](https://www.financealliance.io/top-10-fp-a-skills-to-master/) our teams so they can contribute where it matters: cash flow forecasting, customer service, and commercial insight. When a partner like Sky makes a payment, the job isn’t just to record it, it’s to ask the next question: *What opportunities lie ahead? Are there new products or collaborations we should prepare for?* That mindset shift is what keeps finance relevant in a world where systems handle the transactions, but people still drive the business forward. ## **Enhancing business knowledge in finance** For me, the true value of finance professionals lies in how much they contribute to the business itself. The moment a finance person brings revenue into the company by strengthening customer relationships, identifying opportunities, or supporting new products, their value increases exponentially. It’s not just about protecting the bottom line anymore; it’s about helping to grow the top line as well. Upskilling is essential. People want to earn more, and in today’s economy, the only way forward is to expand their capabilities. Finance teams must understand not just ledgers and compliance but also the commercial levers of the business. That’s how they remain indispensable. [Guide to building stronger cross-functional relationshipsWant to know how finance can build stronger cross-functional relationships? Read this blog to learn more.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceKavin Soni![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--75--6e43e6b731d6c5fa3561383a648d5edd2a3a3200eed4b50e2085414d13da473d.png)](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/) ## **The future of finance careers** We’ve been open and honest with our teams: automation is here to stay. But rather than reducing opportunities, it shifts them. Those who stay static risk becoming irrelevant in a year or two. Those who adapt will thrive. Our own European operations are proof. In the early 2000s, we had around 150 people. Today, we run the same business with just six, yet our profitability is at the same level as when we had a monopoly in the market. The difference lies in how we embraced automation, streamlined operations, and redeployed talent into higher-value work. [Finance Alliance - Events CalendarFrom in-person summits and meet-ups to virtual events and webinars, there’s a finance event for everyone. Our events calendar has it all.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Meta_Images_Text-1-739e6e85cb0e08dfe1cf56f9f499e487f9a2200ced78a7e65922b189e6a74cd8.jpg)](https://www.financealliance.io/events/) ### Where AI actually fits in finance (and where it doesn't) URL: https://www.financealliance.io/where-ai-actually-fits-in-finance-and-where-it-doesnt/ Last updated: 2026-07-02T12:13:01.000Z The vendor pitches keep coming. The pilot ideas are stacking up. And somewhere between the board asking about your AI strategy and your IT team's backlog, the real question keeps getting pushed aside... *Which workflows in your finance function are genuine candidates for AI, and which ones look like they should be?* Asaf Gover has worked with finance teams at public companies and Fortune 500s on hundreds of AI use cases. The finance leaders who get this right aren't the ones with the biggest budgets. They're the ones who know how to read a workflow and tell whether AI belongs there. This live session is built around that skill. --- ## What you'll walk away with - Why some finance AI projects ship, and others die quietly, and the specific patterns that separate them - The difference between a workflow that's genuinely ready for AI and one that will cost you six months and deliver nothing - The workflows that fool even experienced finance teams, real deployment examples, and what actually happened - A way to sit across from any AI vendor, any internal build team, or any agent pitch and know exactly what questions to ask - How finance leaders are using what they already know about their function to drive AI decisions, whether they own the project or sit alongside the team that does --- ## Sound familiar? ***"We ran an AI pilot. It went nowhere. Nobody can tell me why."*** We'll walk through the patterns that separate AI-suited finance work from work that just looks like a fit on the surface. ***"We've got ten vendors telling us their tool is the fix. We have no idea what the problem actually is."*** We'll give you a working diagnostic you can apply to any tool, vendor, or build decision. ***"Every AI conversation in our org ends with 'let's loop in IT.' Finance never gets a seat at the table."*** We'll show how finance leaders are stepping into AI decisions as essential partners, not just stakeholders waiting to be consulted. ***"Our AI project has been 'in progress' for eight months. I've stopped telling the board when it'll ship."*** We'll cover the patterns behind finance AI projects that actually ship, and what the ones that stall have in common. **If any of these sound like your last all-hands, your last vendor call, or your last conversation with the board, this session is for you.** --- ## Meet the speakers [**Asaf Gover**](https://www.linkedin.com/in/asafgover/?skipRedirect=true), *Co-founder and CEO, Apprentice* Asaf founded Apprentice to change how finance and accounting teams work with AI. Before that, he was VP of Product at Taboola (Nasdaq: TBLA), building systems where data capability had to meet the trust and rigor financial environments demand. Today, he helps finance teams at public companies and Fortune 500s build secure, enterprise-grade automations without writing a line of code. [**Rocky Brody**](https://www.linkedin.com/in/rockybrody/), *GTM, Apprentice* Rocky leads go-to-market at Apprentice. She has spent over two decades in B2B SaaS, working directly with finance and accounting leaders on how new technology fits into day-to-day work. Her focus is on helping organizations build reliable agents on workflows specific to their business. [**Join future events**](https://www.financealliance.io/events/) ### CFO Summit New York 2026 URL: https://www.financealliance.io/cfo-summit-new-york-202/ Last updated: 2026-05-19T09:56:22.000Z Catch up on all sessions from CFO Summit New York 2026, including sessions from Hallmark Media, Synergy Pet Group, and more. _This post is for paying subscribers only._ ### Why scenario modelling matters more in high-growth markets like Austin URL: https://www.financealliance.io/why-scenario-modelling-matters-more-in-high-growth-markets-like-austin/ Last updated: 2026-05-22T07:53:47.000Z For finance leaders, volatility is no longer an occasional disruption. It is the operating environment. That reality becomes even sharper in high-growth markets like Austin, where expansion cycles move faster, talent markets tighten quickly, and access to capital can shift dramatically within a quarter. In these environments, scenario modelling is not simply a [forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) exercise. It becomes a core leadership discipline that shapes hiring plans, [capital allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), pricing strategy, and board-level decision-making. [Austin](https://www.financealliance.io/why-austin-has-become-a-hub-for-finance-and-tech/) offers a particularly revealing example of why this matters. The city continues to attract venture capital, corporate relocations, and startup activity at a pace that outperforms many U.S. metros. At the same time, finance leaders across the region are dealing with a more complicated operating environment than the headlines suggest. [Growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) remains strong, but predictability has weakened. That combination changes the role of finance. The CFOs and FP&A leaders succeeding in Austin today are not the ones building the most polished annual budgets. They are the ones building organizations that can respond quickly when assumptions change. [Sensitivity analysis vs scenario analysis | Finance AllianceTrying to decide when to use sensitivity analysis vs scenario analysis? Both techniques are valuable for analyzing the potential effects of uncertainty in financial models. But when does sensitivity analysis make sense, and when is scenario analysis the better choice?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-491.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--22-.png)](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/) ## **High-growth markets amplify both upside and risk** High-growth economies create momentum. They also create fragility. In slower-growth markets, [finance teams](https://www.financealliance.io/how-to-optimize-finance-teams/) often have the benefit of relatively stable hiring demand, moderate wage inflation, and longer planning cycles. [Revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) assumptions may still move, but the pace of change tends to be manageable. Austin operates differently, with [Big Tech jobs growing 44%](https://www.mindmeldpr.com/post/tech-hub-spotlight-austin) between 2018 and 2023 alone. The region continues to attract startup investment across fintech, enterprise software, [healthcare](https://www.financealliance.io/when-healthcare-costs-rise-can-you-explain-why/), and infrastructure technology, as well as climate tech – in fact, last year, there were “over 1,400 companies creating more than 28,000 job openings.” For [finance leaders](https://www.financealliance.io/financial-leadership-in-changing-times-2/), rapid growth sounds positive in theory. In practice, it creates constant pressure on assumptions. Revenue growth may accelerate faster than expected, forcing companies to hire aggressively. Then funding conditions tighten, customer demand softens, or capital costs rise, and leadership teams suddenly need to preserve runway without damaging long-term growth potential. The problem is not volatility itself. The problem is the speed at which volatility compounds in growth markets. In Austin, labor markets can tighten within months. Compensation expectations can reset quickly. Commercial real estate decisions become harder to reverse. Expansion strategies that looked disciplined six months earlier can suddenly appear overextended. Finance leaders cannot rely on static operating plans in that kind of environment. Scenario modelling becomes the mechanism that allows organizations to prepare for multiple realities simultaneously. [Crisis management plan vs business continuity planBelieve it or not, a crisis management plan is not the same as a business continuity plan. The two are similar in many ways, sure, but they have key differences that set them apart.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-492.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--27-.png)](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) ## **Capital efficiency has become a permanent operating pressure** High-growth markets often encourage aggressive expansion behavior. Cheap capital reinforces it. But the last several years changed the conversation inside boardrooms. Finance leaders are now expected to balance growth ambitions with disciplined capital efficiency, even in expansion markets. That expectation has fundamentally altered how organizations approach planning. Austin illustrates this shift clearly. The region continues to attract substantial venture activity, [including several large funding rounds in 2025](https://news.crunchbase.com/venture/all-time-high-funding-to-austin-startups-2025-ai-robotics-manufacturing/). Yet investors have simultaneously become [more selective](https://www.pillsburylaw.com/en/news-and-insights/vc-caution-grows-austin-despite-q1-funding-surge.html), particularly around early-stage funding and profitability expectations. That tension creates a new operating reality for finance executives. Growth is still rewarded. Uncontrolled burn is not. As a result, scenario modelling is increasingly tied directly to capital allocation decisions. [CFOs](https://www.financealliance.io/how-cfos-power-business-strategy/) are being asked to evaluate not only how quickly the business can grow, but how resilient that growth remains under different macroeconomic conditions. This changes the way finance teams think about planning horizons. Historically, many companies built annual operating plans around a single baseline forecast. Today, sophisticated finance organizations are managing layered planning frameworks that account for downside, expected, and accelerated-growth scenarios simultaneously. [10 tips to eliminate forecast biasNo matter how sophisticated our models get, forecast bias has a sneaky way of slipping into our financial plans. If you want to stop forecast bias from creeping in, here are 10 practical ways to put an end to it.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-493.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--5--4.png)](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) That matters particularly in Austin because many companies in the region operate in sectors highly sensitive to capital market conditions. Startup ecosystems can experience rapid swings in [investor](https://www.financealliance.io/investor-relations-as-a-strategic-driver-of-corporate-value/) sentiment. Customer purchasing cycles may tighten unexpectedly. Expansion assumptions tied to venture-backed growth can unravel faster than leadership teams anticipate. **Scenario modelling allows finance leaders to create structured responses before pressure emerges.** For example, finance teams can pre-model what cost reductions would look like under slower growth conditions rather than scrambling during a downturn. They can evaluate which investments remain essential under constrained [cash flow](https://www.financealliance.io/cash-flow-drivers-in-a-business/) scenarios. They can determine how long current runway assumptions remain viable under multiple revenue outcomes. Those exercises are no longer theoretical. Boards increasingly expect them. [Lessons on building robust planning, budgeting, and forecasting processesEvery element (foundation, philosophy, rituals, and artefacts) should serve the needs of stakeholders, particularly shareholders.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-494.png)Finance AllianceNoufal Basheer![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-2.jpg)](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/) ## **Scenario modelling is becoming a leadership function, not a finance exercise** One of the most important shifts happening inside modern finance organizations is that scenario planning is no longer confined to [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/). It has become a leadership tool. In high-growth markets like Austin, finance teams often sit at the center of conversations about expansion timing, pricing strategy, hiring pace, operational capacity, and investor [communication](https://www.financealliance.io/stakeholder-communication-plan/). That means CFOs are increasingly expected to provide forward-looking strategic guidance rather than historical [reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/). The organizations responding best to volatility are usually the ones where finance has visibility across the entire operating model. That visibility matters because market disruptions rarely happen in isolation. A change in hiring costs affects margin assumptions. Margin pressure influences pricing strategy. Pricing decisions affect customer acquisition. Customer acquisition impacts fundraising timing and cash runway. Scenario modelling creates connective tissue between those decisions. It also improves organizational speed. When finance leaders have already pressure-tested assumptions across multiple operating environments, companies can respond faster when conditions change. [Leadership](https://www.financealliance.io/transitioning-to-fractional-financial-leadership-how-to-lead-in-2-4-days/) discussions become more grounded because teams are evaluating predefined frameworks instead of reacting emotionally to new information. That matters significantly in Austin’s business environment, where competitive dynamics often reward speed. [Driver-based forecasting for FP&A to align strategy with realityIf you haven’t tried driver-based forecasting for FP&A, this is your chance to really align your strategy with reality.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-495.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--73--3.png)](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/) ## **Why this conversation resonates differently in Austin** There is a tendency to discuss high-growth cities in broad branding terms. Austin is often framed through population growth, relocation trends, or startup momentum. Those narratives miss the operational reality finance leaders actually face. For CFOs, Austin is not simply a fast-growing market. It is a market where planning assumptions expire faster. That changes the emotional weight of financial [decision-making](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/). A hiring plan approved in January may need revision by June. A funding environment that appeared supportive six months ago may suddenly demand profitability discipline. Customer demand can accelerate rapidly, but so can labor costs and competitive pressure. Finance leaders operating in this environment do not have the luxury of relying on static assumptions. **That is why scenario modelling matters differently here.** In many slower-growth markets, [forecasting](https://www.financealliance.io/how-to-forecast-inventories/) is primarily about improving precision. In Austin, forecasting is increasingly about improving adaptability. Those are not the same thing. The finance organizations creating competitive advantage today are not necessarily the ones with perfect predictions. They are the ones building systems that allow leadership teams to pivot intelligently when predictions inevitably change. That distinction is becoming central to modern [CFO leadership](https://www.financealliance.io/top-10-cfo-skills/). [Why Austin has become a hub for finance and techIf Austin shows anything clearly, it is how quickly finance can move from being a support function to the engine behind decision-making.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-496.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--24--1.png)](https://www.financealliance.io/why-austin-has-become-a-hub-for-finance-and-tech/) ## **Finance leaders are redefining planning in growth markets** The next phase of finance leadership will likely belong to organizations that can combine strategic agility with operational discipline. Austin offers an early view into what that future looks like. The city’s mix of startup activity, venture investment, talent competition, and corporate expansion creates conditions that force finance teams to evolve faster. Traditional [annual planning](https://www.financealliance.io/budget-vs-annual-operating-plan/) models are increasingly insufficient for managing that level of complexity. As a result, scenario modelling is moving closer to the center of executive leadership conversations. Not because it is fashionable, but because volatility has become structural. Finance leaders now need frameworks that allow them to manage uncertainty without slowing decision-making. They need planning systems that support both aggressive growth and downside resilience. Most importantly, they need the ability to help organizations move confidently even when market conditions remain unclear. ## **FP&A Summit – Austin** That challenge is particularly relevant in Austin right now. Which is why conversations around financial agility, capital efficiency, workforce planning, and scenario strategy are becoming increasingly important among [CFOs](https://events.financealliance.io/location/cfoaustin) and [FP&A leaders](https://events.financealliance.io/location/austin) operating in high-growth markets. Those themes are expected to feature prominently at our upcoming [Austin summit](https://events.financealliance.io/location/austin), where finance executives will discuss the realities of leading through volatility in one of the country’s fastest-moving business ecosystems. [****This is your chance**](https://events.financealliance.io/location/austin) to take a step back from daily pressures and learn how other finance leaders (from companies like Google, Uber, Indeed, Walmart, and SciPlay) are tackling similar challenges. Not just in theory, but with practical insights on scaling teams, managing capital, and keeping up with a fast-moving business. [Get your ticket now ](https://events.financealliance.io/location/austin) ### Controller Summit New York | May 2026 URL: https://www.financealliance.io/controller-summit-new-york-may-2026/ Last updated: 2026-05-13T10:50:47.000Z Catch up on all sessions from our CFO and Controller Summits New York, with talks from companies like Dscout, Hallmark, Reddit and more. _This post is for paying subscribers only._ ### Crisis management plan vs business continuity plan URL: https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/ Last updated: 2026-05-12T13:50:28.000Z Believe it or not, a crisis management plan (CMP) is not the same as a business continuity plan (BCP). The two are similar in many ways, sure, but they have key differences that set them apart. When disaster strikes and steers the business off course, it can lead to chaos, and in extreme cases, send the business into bankruptcy. For finance teams, this means [safeguarding liquidity and managing cash flow](https://www.financealliance.io/12-proven-strategies-for-managing-liquidity/), and ensuring the business can weather the storm. The good news is that you can help the business avoid such a catastrophic fate by creating and implementing both a business continuity plan and a robust crisis management plan. And, even *better*, you can build them in such a way that they work effectively together to help prepare the business and guide it through any crisis. So, if you want to know the main differences between a crisis management plan vs business continuity plan, keep reading! ## **What is a crisis?** Before we can compare the differences between a crisis management plan vs a business continuity plan, let's define what we mean by 'crisis.' A crisis in the context of business is an event that disrupts the business's facilities such as [data](https://www.financealliance.io/mastering-data-storytelling/), personnel, IT systems, etc. This can then cause production to cease, which stops the business from running as it should. The impact of a major crisis on a business can have a knock-on effect and negatively impact areas including production schedules, the business's reputation, customer advocacy, [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/), and so on. Here are some examples of potential crises that could impact a business: - Accidental disasters (power cuts, fires, gas leaks, etc.) - Natural disasters (storms, hurricanes, floods, etc.) - Technological disasters (corrupt software, faulty hardware, harmful cyber-attacks, etc.) - Vandalism or theft - Fuel shortages - Loss of a staff member or a staff member being ill and unable to work - Disease or widespread infection (COVID-19 is a prime example of this) - Terrorist attack (local or abroad) - Human error - War - Privacy policy issues - Supply chain issues - An industry strike - Data protection issues - Collapse of infrastructure - Abandonment in leadership The reality is, businesses face a *wide* range of potential threats, both predictable and unforeseen. Recognizing the variety of these potential disruptions underscores the critical need for proactive [planning](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/). Without proper crisis management and business continuity strategies in place, companies are left [vulnerable to significant, and potentially irreversible, damage](https://www.financealliance.io/steering-through-storms-a-cfos-guide-to-economic-resilience/). [Profit planning: Why most fail & 7 steps to succeedThe hard truth is that most businesses aren’t profit planning properly or nearly enough. Many are stuck in their old ways using outdated strategies, overlooking critical factors, or worse, flying by the seat of their pants with no real plan at all.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-77.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/profit-planning-1.png)](https://www.financealliance.io/profit-planning/) ## **What is a crisis management plan?** A crisis management plan (CMP) is a response plan to a crisis that would negatively impact the business's ability to operate or damage its reputation or [profitability](https://www.financealliance.io/profit-planning/). Businesses must be prepared to face different crises appropriately and crisis management plans act as guides to help [navigate critical situations](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/) and avoid further catastrophes. The plan should include a set of steps to help the business handle the crisis. So, just how important is a crisis management plan? One data point I keep coming back to: a FEMA statistic widely cited in disaster recovery coverage suggests [**40% of businesses never reopen**](https://www.accesscorp.com/press-coverage/study-40-percent-businesses-fail-reopen-disaster/) **after a disaster**. That's why your crisis management plan needs to be specific about decision rights, [communications](https://www.financealliance.io/stakeholder-communication-plan/), and cash actions before the first urgent call comes in. To give your business [the best possible chance of survival](https://www.financealliance.io/how-to-prepare-for-a-financial-crisis/), you need a well-thought-out crisis management plan with specific steps to handle such an event. ## **What is a business continuity plan?** A business continuity plan (BCP) outlines how a business will continue to operate should an unplanned occurrence take place. It's a comprehensive document that acts as a [prevention and recovery system for potential threats](https://www.financealliance.io/cfo-cybersecurity/) or disruptions such as cyber-attacks or natural disasters. The best BCPs are those that have been tested numerous times to make sure there are no gaps or weaknesses. And, if some weaknesses are identified during the testing process, those must be corrected. This is to ensure personnel and assets are fully protected in the event of a crisis. The main goal of a BCP is to provide the business with thorough strategies and information required to maintain operations throughout and following a disaster. [The best working capital strategies for FP&AUncover the best working capital strategies for FP&A in this blog, which reveals how working capital management acts as a key cash driver.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-78.png)Finance AllianceLiudmila Gudina![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--42-.png)](https://www.financealliance.io/the-best-working-capital-strategies-for-fp-a/) ## **Crisis management plan vs business continuity plan: Key differences** So where do these two plans actually diverge? On the surface, they both deal with disruption. Dig a little deeper and you'll see they solve different problems at different points in time. Here's a side-by-side breakdown: ![Crisis management plan vs business continuity plan: Key differences](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/05/Crisis-management-vs-business-continuity-plans.png) Think of the CMP as what you reach for the moment something goes wrong. The BCP is what keeps the lights on while you're dealing with it. A quick example. When COVID-19 hit, companies activated crisis management plans to communicate with staff, close offices, and address investor concerns. Their business continuity plans handled the longer tail, including remote work infrastructure, [supply chain rerouting, and cash flow protection](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/). Two plans, one disruption. For finance teams, the distinction matters. Your CMP determines who signs off on emergency spending and how you communicate with lenders. Your BCP [protects payroll, close cycles, and reporting obligations](https://www.financealliance.io/how-to-streamline-financial-consolidation-and-planning/) when the worst happens. ## **How crisis management and business continuity plans work together** Treating your CMP and BCP as separate documents is a mistake. They're two halves of the same operational resilience strategy. Here's how they connect: - **Handoff**: The crisis management plan activates first to stabilize the situation. Once immediate decisions are made, business continuity takes over to keep critical operations moving. - **Shared leadership**: Your crisis response team and business continuity owners need to know each other. The same people often wear both hats. - **Common communication protocols**: Stakeholder messaging, media statements, and internal updates should flow through one agreed channel, not two competing ones. - **Disaster recovery sits inside the BCP**: If your systems go down, your disaster recovery plan handles the technical rebuild while business continuity keeps the business functioning through workarounds. Test them together. [Run tabletop exercises and simulations](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) that stress both plans at once. You'll find the seams, the handoff gaps, and the assumptions that don't hold up when business continuity and crisis management collide in real time. That's the whole point of practicing before the real thing arrives. [When should you actually trust AI in a finance decision?The frame of “trust AI or don’t trust AI” is too simple. The better frame is: is this output ready to be acted on? That requires you to ask hard questions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-489.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--26-.png)](https://www.financealliance.io/when-should-you-actually-trust-ai-in-a-finance-decision/) ## **Top tips to create a crisis management plan you can trust** This plan is about the first crucial hours and days of a disruption. It's your playbook when decisions need to happen fast. A useful framework to anchor your thinking is the 5 Ps of crisis management: prevent, prepare, practice, [perform](https://www.financealliance.io/flexible-budget-performance-report/), post-crisis. Here's how to build a crisis management plan that holds up under pressure: 1. **Identify potential crises.** Map every plausible disruption, from cyberattacks and natural disasters to supply chain failure and leadership loss. Rank them by likelihood and impact. 2. **Establish a crisis response team.** Who's in charge? Who handles internal communication? Who talks to the media? Define roles clearly and name backups for each. 3. **Develop communication protocols.** Agree on how you'll communicate internally and externally. Pre-write holding statements for the scenarios you've identified. 4. **Create actionable checklists.** Step-by-step instructions for each type of crisis keep people moving when the pressure's on. Keep them short and readable. 5. **Run tabletop exercises.** Simulations and drills are where plans get stress-tested. Run them at least annually, and invite executives to participate, not just observe. For finance teams specifically, access to cash is paramount. Build a **crisis budget**, identify readily available funds, and model scenarios that hit cash flow. Set trigger points that tell you when to act. [What does a finance director do? | Career guideIn this career guide, we take you through all the major pillars of this role from key responsibilities to skills, qualifications, salary, and more.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-490.png)Finance AllianceChristopher Reed![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--13--2-3.png)](https://www.financealliance.io/what-does-a-finance-director-do/) ## **Tips to create a business continuity plan** This plan is about keeping the lights on and ensuring your business can continue operating, even if in a limited capacity. 1. **Business impact analysis.** Don't just ask "what's essential?" Map out the entire flow of key processes. Identify dependencies between departments, systems, and data. 2. **Recovery strategies.** How will you recover critical systems and data? Do you have backups? Can you work remotely? Develop detailed procedures for restoring systems and data and make sure you have alternative communication methods if your primary systems are down. 3. **Alternative workspaces.** Do you have a backup location if your office is unusable? Identify specific locations, whether they're remote work setups, co-working spaces, or pre-arranged backup offices. 4. **Supplier and vendor contingencies.** What happens if your key [suppliers](https://www.financealliance.io/why-supply-chains-determine-post-merger-success/) are disrupted? Have backup suppliers ready. 5. **Regular testing and updates.** Business continuity plans are living documents. Review and update them regularly. --- **Develop financial models that project the impact of different scenarios on revenue, expenses, and profitability. This will help you prioritize recovery efforts.** Building resilient finance functions takes more than a single plan; it takes continuous learning, the right frameworks, and a network of peers who've been there. [Accelerate your career](https://www.financealliance.io/pro-plus-membership/) with Finance Alliance Pro+ Membership and unlock [FP&A certifications](https://certified.thealliance.io/course/fpa-certified-core), pre-built financial models, templates, soft skills workshops, a mentor program, and exclusive access to a community of finance leaders shaping the future of the function. --- ## **Frequently asked questions** #### ****What are the 5 Ps of crisis management?** The 5 Ps of crisis management are prevent, prepare, practice, perform, and post-crisis. This framework helps you identify risks early, define roles and action plans, rehearse through simulations, execute during the real event, and then review and refine afterward to strengthen your response for next time. #### ****What are the 4 pillars of crisis management?** The four pillars of crisis management are preparedness, response, recovery, and mitigation. Preparedness covers planning and training, response is the immediate action during a crisis, recovery restores normal operations, and mitigation reduces the risk of the same crisis happening again. #### ****What are the 4 pillars of business continuity?** The four pillars of business continuity are assessment, preparedness, response, and recovery. Assessment means identifying hazards and evaluating risks to your critical functions, then layering prevention and recovery measures on top to keep your business running when disruption hits. #### ****What are the 5 Cs of crisis management?** The 5 Cs of crisis management are commitment, clarity, communication, collaboration, and care. They're the leadership behaviors that separate organizations that come out stronger from those that don't, focusing on how you lead people through uncertainty rather than just following procedures. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_3.png) ](https://www.financealliance.io/insider-membership-plan/) ### Maximizing ROI in M&A: A CFO’s guide to value creation and synergy capture URL: https://www.financealliance.io/maximizing-roi-in-mergers-and-acquisitions/ Last updated: 2026-05-07T08:34:33.000Z Mergers and acquisitions are often discussed in terms of numbers. People talk about valuations, [EBITDA](https://www.financealliance.io/ebitda-calculator-guide/) multiples, growth assumptions, synergies, and returns on investment. Those [metrics](https://www.financealliance.io/32-cfo-kpis/) absolutely matter, and as a CFO, I spend a great deal of time focused on them. But after working through more than forty acquisitions over the last seven years, I can say with confidence that [successful M&A](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) is about far more than financial engineering. At EP Wealth Advisors, acquisitions have been a major part of our growth story. We have grown to nearly $29 billion in assets under management, more than 500 employees, and close to fifty offices across the country. We are now one of the top twelve registered investment advisers in the United States, operating in an industry that remains highly fragmented, with more than fifteen thousand RIAs nationwide. Our [growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) has accelerated significantly over the past several years. We have been growing at a compound annual growth rate of nearly forty percent, effectively doubling the size of the firm every two years. That growth has been driven largely through [acquisitions](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/), although we prefer to call them partnerships because, frankly, nobody likes to feel acquired. [Acquisition financing: how it works and funding optionsDone right, acquisition financing fuels growth. Done poorly, it can sink the whole ship. The sweet spot is structuring a deal that makes strategic sense and positions your now-bigger company for continued success into the future.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceChristopher Reed![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/FA_Website_Article_Images_Doodles--14-.png)](https://www.financealliance.io/acquisition-financing/) The story of EP Wealth Advisors itself reflects the kind of long-term thinking that matters in business. The firm was founded by two childhood friends from San Diego who both ended up in wealth management. Their first client was one of the cofounder’s grandmothers, who entrusted them with $800 to manage. That was the largest amount she felt comfortable [investing](https://www.financealliance.io/7-benefits-of-esg-investing/) at the time. Today, the firm has grown into a multibillion-dollar business serving clients across the country. In our industry, we operate under the fee-only registered investment adviser model. Unlike broker-dealers that generate commissions from transactions, our fees are based on the portfolios we manage for our clients. Most of our clients are individuals with investable assets ranging from one to ten million dollars, and we provide a broad suite of services including [financial planning](https://www.financealliance.io/10-big-picture-financial-planning-steps/), estate planning, retirement planning, and portfolio management. Because our industry is so fragmented, M&A activity has become a significant driver of growth. But growth alone is not enough. Acquisitions only create value when they are executed thoughtfully, integrated effectively, and supported consistently after the deal closes. Over time, I’ve come to think about the CFO’s role in M&A as a lifecycle that extends well beyond the initial transaction. It starts with valuation and underwriting, moves through due diligence and integration planning, and ultimately depends on what happens after the close. In many ways, the post-close phase is where the real work begins. ## **Understanding the CFO’s role in M&A** People often assume the CFO’s role in acquisitions is primarily financial oversight. That is certainly part of it. Valuation, capital planning, deal structure, [forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/), and risk management are all core responsibilities. But one thing I’ve learned repeatedly is that creativity and flexibility are just as important as technical financial expertise. Every acquisition is different, even when two deals appear nearly identical on the surface. The structure that works for one seller may not work for another. The timing of payments, the balance between cash and equity consideration, and the long-term expectations of both parties can vary dramatically. In many cases, the [CFO](https://www.financealliance.io/top-10-cfo-skills/) becomes a translator between strategy and execution. You are helping determine not only whether a deal makes financial sense, but also whether the business can realistically absorb and integrate the acquired firm. That means balancing growth ambitions with operational realities. When I think about the lifecycle of an acquisition, I break it into four broad stages. The first is valuation and underwriting. The second is due diligence. The third is integration planning. The fourth is post-close optimization. Each stage presents its own challenges, and weaknesses at any point in the process can create problems later. [Are you prepared to navigate the intricacies of an M&A?David Yates, CFO at Gresham, takes you on a journey through the intricacies of an M&A so you can unlock the best returns for your organization.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceDavid Yates![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/Copy-of-FA_Website_Article_Images_Author_Highlight--48-.png)](https://www.financealliance.io/are-you-prepared-to-navigate-the-intricacies-of-an-m-a/) ## **Valuation is more than choosing a multiple** One of the first questions in any acquisition is determining how to value the business. The answer depends heavily on the industry and the structure of the transaction. In wealth management, we primarily use multiples of [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) or EBITDA. Those are the most common valuation metrics in our space. I always joke a little when I see EBITDA figures because there is often a difference between the EBITDA that has been polished to look attractive and the actual free cash flow realities of the business. Part of the CFO’s job is separating optimism from reality. In our case, all of our acquisitions are asset purchases, which simplifies certain aspects of the process compared to equity transactions. But regardless of structure, valuation is only the starting point. The more important question is what the business is likely to become over time. That is where underwriting and [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) come into play. A discounted cash flow model, for example, forces you to think beyond current performance and evaluate how the business may perform in the future. What are the growth assumptions? Are they realistic? What external factors could impact performance? In our industry, market conditions play a major role in outcomes. Interest rates matter. Equity markets matter. Client asset flows matter. You also need to think carefully about synergies. When people hear the word “synergy,” they often immediately think about cost-cutting or headcount reductions. Those can certainly be part of the equation, but I think that definition is too narrow. Some of the most valuable synergies we’ve realized have come from the people and expertise we acquired. Firms bring institutional knowledge, industry perspective, and intellectual capital that can strengthen the broader organization. If you focus only on eliminating costs, you risk missing the real value of the acquisition. [Investor relations as a strategic driver of corporate valueIn this article, we explore how IR officers and finance professionals can achieve that goal in a more efficient manner.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceDerrick Bonyuet, PhD, CFA, CFP, CPA![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/Copy-of-FA_Website_Article_Images_Author_Highlight--65-.png)](https://www.financealliance.io/investor-relations-as-a-strategic-driver-of-corporate-value/) ## **Capital planning requires flexibility** Once valuation and underwriting are complete, the conversation shifts toward capital planning and deal structure. This is where flexibility becomes essential. When we negotiate transactions, one of the key questions is the mix of consideration. How much cash are we offering? How much equity? Are there holdbacks? Earn-outs? Deferred payments? The answers have major implications for liquidity planning and cash flow forecasting. Some deals may involve payouts over one or two years. Others may stretch much longer. Even transactions that appear structurally similar can require entirely different approaches depending on the priorities of the seller. I cannot overstate how important adaptability is during this stage. Rigid deal structures often fail because they ignore the human side of the negotiation. Sellers may care deeply about the future of their employees, the continuity of client relationships, or their own long-term involvement in the business. A successful transaction requires understanding those motivations and structuring the deal accordingly. [What is a Fractional CFO? Definition, cost & how to hire oneMany CFOs have left full-time positions to regain control of their careers and their time. But how did they do it? That’s what you’ll find out in this blog post as we uncover how to become a fractional CFO.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/Copy-of-FA_Website_Article_Images_Doodles--3-.png)](https://www.financealliance.io/how-to-become-a-fractional-cfo/) ## **Due diligence goes far beyond the financials** Once you move past the letter of intent, the due diligence process begins. Financial due diligence is obviously critical. You are reviewing historical financial statements, evaluating key performance indicators, analyzing profitability, and validating revenue streams. At EP Wealth Advisors, we perform what we describe as a “quality of earnings light” review. We spend time tracing cash flows to ensure the revenue we believe we are acquiring is actually there. You also need to evaluate liabilities carefully. Even in an asset transaction where liabilities are technically excluded, there may still be obligations that become part of the operational reality after the close. Office leases, vendor agreements, technology contracts, and long-term commitments can all influence the economics of the deal. But financial diligence is only one piece of the puzzle. Operational diligence and cultural diligence often end up consuming even more time. Technology integration, for example, can become incredibly complicated. At EP Wealth Advisors, we operate under a fully integrated model. Some firms in our industry function more like aggregators, acquiring businesses while allowing them to continue operating independently. That is not our approach. When we acquire firms, they become part of one integrated organization with a unified technology stack and operating model. That means we have to think carefully about the timing and complexity of technology transitions. Most importantly, every decision has to remain client-centric. Clients did not ask for their advisory firm to be acquired. They simply expect the same level of service they have always received. If the acquisition creates disruption or confusion for clients, the integration has already started to fail. That is why maintaining a seamless client experience becomes one of the most important operational priorities. [Why Austin has become a hub for finance and techIf Austin shows anything clearly, it is how quickly finance can move from being a support function to the engine behind decision-making.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/FA_Website_Article_Images_Doodles--24-.png)](https://www.financealliance.io/why-austin-has-become-a-hub-for-finance-and-tech/) ## **Culture determines whether acquisitions succeed** In my experience, culture and people are often the biggest determinants of success in M&A. The acquisitions that have performed best for us are consistently the ones where the people joining the organization remained engaged and committed after the close. You can see the difference in the numbers almost immediately. When engagement is high, integration tends to move smoothly, [collaboration](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) increases, and growth opportunities emerge naturally. When engagement is low, problems surface quickly. One reason this matters so much is that many firms we acquire are entrepreneurial businesses built over decades. Some are only three- or four-person organizations. Others may have fifty or sixty employees. For founders and senior leaders, selling the company is not just a financial transaction. It is emotional. Many of these individuals have spent twenty or thirty years building their firms. Their identities are deeply connected to the business. That is why empathy matters. Acquisitions may happen frequently for large organizations, but for many sellers, this may be the only acquisition they experience in [their entire career](https://www.financealliance.io/fp-a-salary-and-career-path-guide/). Clear communication becomes essential. People need clarity around reporting structures, roles, responsibilities, and expectations. A CFO from a three-person firm is obviously not going to become the CFO of a five-hundred-person organization, so what is the right role for that person going forward? Those conversations need to happen early. Training is also critical, especially when technology platforms are changing. Teams need repeated and consistent support to ensure they are comfortable with new systems before they are expected to operate independently. I’m also a strong believer in creating a single point of contact during integration. Large organizations can feel overwhelming. People may not know who to contact for technology issues, operational questions, or process guidance. Having one dedicated resource who can help navigate the organization reduces frustration and improves the overall experience. ## **Why integration planning matters so much** One of the biggest mistakes companies make is treating due diligence as the finish line. In reality, due diligence is only valuable if you have a clear integration strategy for acting on what you learned. At EP Wealth Advisors, we have a dedicated partnership integration team responsible for managing the process from due diligence through onboarding. That team develops timelines, identifies objectives, coordinates departments, and ensures accountability across the organization. The integration plan needs to answer practical questions. How long will integration take? Can it realistically happen in a month, or will it require six months? What are the priorities? Who owns each responsibility? In wealth management, integration can be particularly complex because client consent is required for account transitions. That process alone can take considerable time. Another challenge is internal alignment. Departments involved in integration still have their normal day-to-day responsibilities. Operations teams, client service teams, and [portfolio](https://www.financealliance.io/client-portfolio-fractional-cfo/) management teams all have existing workloads. If integration work is viewed as secondary or optional, progress slows dramatically. That is why organizational buy-in is so important. Everyone involved has to understand the strategic significance of the acquisition and their role in making it successful. [Why supply chains determine post-merger successMergers aren’t tested in boardrooms, but in factories, planning systems, supplier networks and distribution centers, long after the deal announcement.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceMasha Chandrasekaran![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/Copy-of-FA_Website_Article_Images_Author_Highlight--26-.png)](https://www.financealliance.io/why-supply-chains-determine-post-merger-success/) ## **The real work begins after the close** One of my least favorite phrases is “post-merger optimization” because it sounds overly corporate and abstract. But the concept itself is critically important. Once the deal closes, the organization has to prove the acquisition thesis was correct. That starts with measurement. Can you track the acquired firm’s performance effectively? Do you have access to the right data? Are the assumptions from the original forecast actually materializing? You also need to evaluate whether planned synergies are occurring on schedule. If the acquisition was expected to generate cost savings or operational efficiencies, when are those benefits supposed to appear? Our board often asks a simple but important question after an acquisition closes: “So what?” In other words, what happens next? That question forces accountability. We go back to the original growth assumptions, discuss the forecast, and evaluate whether execution is aligning with expectations. One of the most valuable things we do during this phase is maintain constant communication with newly acquired firms. We gather feedback continuously. Sometimes the feedback leads to new ideas and operational improvements. Sometimes it reveals frustrations or complaints. Both are valuable. If you plan to pursue acquisitions consistently, your integration process needs to evolve continuously as well. Support also matters enormously during this phase. One mistake I see frequently in the industry is the assumption that once the acquisition closes, the acquired team should immediately perform at full capacity inside the new organization. That expectation is unrealistic. People need support, guidance, and time to adapt. Successful integration is not something that happens automatically on day one. [How to transform financial data into compelling storiesFP&A professionals have to understand the business deeply. We’re not just reporting results or explaining variances. We are taking on part of the decision-making burden.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceLewis Danby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/12/FA_Website_Article_Images_Doodles--5-.png)](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) ## **What happens when things go wrong** No matter how thorough your due diligence process is, not every acquisition will unfold exactly as planned. Growth assumptions may prove too optimistic. Market conditions may change. Integration challenges may emerge unexpectedly. When that happens, the first thing I do is go back to the original assumptions. Were the forecasts unrealistic? Did we miss something during diligence? Was the process itself flawed? Sometimes the issue is simply that expectations were disconnected from reality. For example, some acquisitions in our industry are succession deals involving founders who plan to retire within the next twelve to twenty-four months. In those situations, we intentionally maintain lower growth expectations because the business may naturally stabilize rather than expand aggressively. If a transaction was modeled with aggressive growth assumptions that never materialize, the problem may begin with the forecast itself. But regardless of the cause, the solution usually starts with people. We have open conversations about what is working and what is not. At EP Wealth Advisors, we have a learning and development department dedicated to helping advisers build the skills necessary for success. You cannot always control outcomes, but you can ensure the organization is properly resourced to respond to challenges. The key is addressing problems directly rather than hoping they resolve themselves. [Why most mergers fail: Lessons from weather patterns and M&A due diligenceUnlike weather forecasting, where being wrong just means carrying an umbrella, being wrong about an acquisition can destroy both companies.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceBill Guerrero![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/11/FA_Website_Article_Images-Text.png)](https://www.financealliance.io/why-most-mergers-fail/) ## **Communication can make or break an acquisition** One of the most important lessons I’ve learned through acquisitions is that communication failures create many of the worst integration outcomes. Employees need transparency. When people are left in the dark and suddenly informed that their company has been acquired, uncertainty spreads quickly. That uncertainty often leads to disengagement, distrust, and turnover. By contrast, the best integrations are usually the ones where employees are brought into the process thoughtfully and early. That includes honest conversations about organizational changes, future roles, and potential synergies. Headcount reductions, when necessary, should never come as a surprise. In many cases, sellers already understand that synergies are part of the transaction and that those efficiencies may influence the purchase price. But communication around those changes has to be handled carefully and respectfully. If an integration reaches the point where management is rushing for the exits and employees feel abandoned, something has likely gone very wrong in the process. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/finance-charts.png)](https://www.financealliance.io/financial-charts-and-graphs/) ## **Building infrastructure for repeatable M&A success** As acquisition activity scales, process discipline becomes increasingly important. One common frustration in due diligence is inefficiency. Sellers often end up answering the same questions repeatedly for different teams inside the acquiring organization. That creates frustration and wastes time. At EP Wealth Advisors, we addressed this by creating a dedicated partnership integration team that guides firms from the letter of intent through closing. The team centralizes communication and coordinates information requests so the process remains organized and focused. We also use project management tools like Monday.com to track responsibilities across departments and ensure accountability throughout the integration process. The goal is not to create unnecessary administrative work. In fact, one of the worst things an acquirer can do is ask for information that is not actually needed. I’ve seen diligence request lists that are miles long when only a small fraction of the information is truly relevant. Effective infrastructure should simplify the process, not complicate it. ## **M&A success is ultimately about balance** At its core, M&A is about balancing financial discipline with human understanding. You need rigorous valuation models, thoughtful capital planning, thorough due diligence, and strong operational execution. But you also need empathy, [communication](https://www.financealliance.io/stakeholder-communication-plan/), flexibility, and patience. The most successful acquisitions are not necessarily the ones with the most aggressive forecasts or the biggest synergies on paper. They are the ones where strategy, people, operations, and execution align over time. For CFOs, that means bringing more than financial oversight to the table. It means acting as a strategic partner throughout the entire lifecycle of the transaction. It means understanding that value creation does not stop when the deal closes. In many ways, that is when the real work finally begins. ### Building AI products in finance: the intersection of data, product thinking, and AI URL: https://www.financealliance.io/building-ai-products-in-finance-the-intersection-of-data-product-thinking-and-ai/ Last updated: 2026-04-24T14:00:54.000Z I want you to picture an image of a [bot assisting a human](https://www.financealliance.io/when-should-you-actually-trust-ai-in-a-finance-decision/) with operational work. That is the north star I am chasing. The whole idea of “human in the loop”, where an AI bot works in [collaboration](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) with a human to achieve a great outcome. And if we get this absolutely right, maybe we can spend our evenings sipping a Chardonnay and thinking about more strategic work, rather than spending our time downloading data from [ERP systems](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/), stitching together manual spreadsheets, and then coming up with recommendations. Because that is what happens today. Believe it or not, a lot of us are stuck in what I call the manual chaos, spending hours and hours trying to get a good insight by stitching data together. That is what I want to avoid. The question I am trying to answer is: **how do you build AI products in finance that actually compound in value over time?** [Why human skills are the future of financeAs AI transforms finance, it’s not just about tech, it’s about people. Discover why emotional intelligence, curiosity, and leadership are the real future skills that will set you apart.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceDaniele Martins![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/Copy-of-FA_Website_Article_Images_Author_Highlight--61-.png)](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) ## **The problem: meet Jane** Before I talk about the problem, I want you to meet a hypothetical character: Jane. Jane is a director of FP&A, extremely strategic, one of the [highest performers](https://www.financealliance.io/how-to-nurture-high-performance-finance-team/) in her company and team. When the stakes are really high, when new decisions have to be made, people go to Jane. That is what we all want to be. But Jane is stuck in a manual chaos. Her manager Amanda asks, "Why is there a difference between your [forecast](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) and the actuals?" Jane is going to spend all her energy doing the manual climb, get good insight commentary, and share it back. The output is great. The process is broken. Daniel Kahneman, the author of Thinking Fast and Slow, introduced us to two different kinds of thinking. System 1 is fast, reactive thinking, a little more error-prone by nature. System 2 is slower, more logical, more thought-through. Jane's situation can be perfectly described as a System 1 trap. Not because she wants to operate that way, but because her system forces her to. She is spending all her time [compiling data to get good insights](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/), so that by the time she arrives at the insight, she does not have much time left and ends up relying on System 1 thinking to get a result. That is not what we hired a director for. We primarily hired a director to provide good strategic insights, which are mainly System 2 thinking. That is the critical point, and I will keep coming back to the System 1 versus System 2 concept throughout. There is also a black box risk here. Jane is an incredibly astute person, but that intelligence lives in her head. If she decides to leave the company, that knowledge goes away. She will have [documentation](https://www.financealliance.io/3-pillars-of-finance-transformation/), sure, but how many of us honestly read the documentation, right? There is a lot of knowledge that disappears with a person. And if Jane, without having thought through the manual chaos carefully, now puts an AI model on top of it, she is not solving the problem, she is only scaling the manual chaos faster. We have all heard the analogy: garbage in, garbage out. So to summarize: the problem, in my mind, is less about not having the perfect tool. It is more about having an operating model gap that prevents Jane from successfully using her System 2 thinking. The gap between where she is forced to operate (System 1) and where she should be (System 2) is what I call the ROI gap. It is the talent tax we are paying when we do not leverage Jane's capabilities to their fullest. [How generative AI is transforming financeFinancial advisors could use AI to generate initial investment recommendations while focusing their expertise on understanding client needs and providing personalized guidance.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/02/FA_Website_Article_Images_Doodles--9-.png)](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) _This post is for paying subscribers only._ ### When should you actually trust AI in a finance decision? URL: https://www.financealliance.io/when-should-you-actually-trust-ai-in-a-finance-decision/ Last updated: 2026-04-23T13:19:24.000Z There's a version of this conversation that's been happening in boardrooms, finance team offsites, and panel sessions for the past two years. Someone mentions AI. Half the room leans in. The other half crosses their arms. And then somebody asks the question that nobody has a clean answer to yet: *when is* [*AI-generated*](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) *analysis actually good enough to act on?* That's not a question about the technology. It's a question about judgment. And if you're a [finance leader](https://www.financealliance.io/what-does-a-finance-director-do/), it's probably one of the most consequential calls you're being asked to make right now, often without a framework to guide you. We're past the era of debating whether AI belongs in finance. [Finance professionals who use AI regularly report](https://tipalti.com/press/ai-in-finance-trust-gap-report/) improved quality of work (98%), enhanced decision-making (97%), and cost savings (96%). The benefits aren't theoretical. The ROI is real. But the hard question isn't whether AI *can* help; it's whether the output in front of you, right now, is good enough to move money on. That line between "useful analysis" and "decision-grade insight" is where the real debate lives. [![CTA Image](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/04/Screenshot-2026-04-23-at-14.11.38.png)](https://virtual.financealliance.io/location/aifinance/) [Join our summit](https://virtual.financealliance.io/location/aifinance/) to hear how finance teams are embedding AI in FP&A, forecasting, planning and control workflows: where it saves time, where it improves decisions, and where human judgment still matters most. Tune in live and access every session recording OnDemand. [Get your free ticket ](https://virtual.financealliance.io/location/aifinance/) ## **The trust gap nobody talks about openly** Here's something worth sitting with. While [78% of Americans now use AI-enabled tools](https://stories.td.com/us/en/article/nearly-80-of-americans-use-ai-tools-but-most-still-want-humans-making-financial-decisions-td-survey-finds) in their daily lives, only 18% say they would trust AI to make financial recommendations on its own. That's a staggering gap. And it holds across the industry in ways that matter even more at the institutional level. Last year, only 10% of consumers said they used AI to help manage their personal finances. In 2026, 55% reported doing so. The adoption curve is steep. But the trust curve is lagging well behind, and for good reason. Adoption tells you that people find AI useful for *doing things*. The trust gap tells you they haven't yet handed over the final call. For finance teams, this distinction is everything. You can use AI to surface patterns in a dataset, to stress-test a forecast, to flag anomalies in your accounts receivable. All of that is enormously valuable. But when the analysis lands on your desk and someone has to sign off on a capital allocation decision, a credit approval, or a scenario recommendation heading to the board, that's when the real question kicks in. Is this output decision-grade, or is it still just directional? A report reveals that finance teams see AI's value clearly but face a persistent trust gap; and that closing it [depends on governance, training, transparency, and better data quality](https://tipalti.com/press/ai-in-finance-trust-gap-report/). Those aren't soft concerns. They're the actual infrastructure of trustworthy AI output. [What we’ll lose if we let AI take over finance (a cautionary tale)AI can crunch numbers, but it can’t build trust. Here’s what we risk losing if we forget the human side of FP&A.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceJay Dyer![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/Copy-of-FA_Website_Article_Images_Author_Highlight--6-.png)](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/) ## **What "decision-grade" actually means in practice** The phrase "decision-grade" doesn't have an industry standard definition yet, and that's part of the problem. But if you talk to finance leaders long enough, a working definition starts to emerge. AI analysis is decision-grade when you can defend every step of it. When the assumptions are visible. When the data lineage is clean. When a regulator, a board member, or a skeptical CFO could pick it apart and you'd have a clear answer for every challenge. That's a high bar. And a lot of AI output (even impressively accurate AI output) doesn't meet it. Wolters Kluwer's guidance on AI in finance makes a point that sticks: “If an organization cannot explain a decision output, [it cannot be used](https://www.wolterskluwer.com/en/expert-insights/embracing-the-2026-ai-frontier-in-subprime-finance).” The bar isn't just accuracy, it's traceability. Finance teams need to show how a conclusion was reached, not just what it was. This isn't only a compliance concern, though regulation is a big part of it. It's about intellectual honesty. When you put your name on a recommendation, you're accountable for the reasoning underneath it, not just the figure at the end. The pattern is consistent across every credible source on this topic: AI in finance only scales where it earns trust. And earning trust means being able to show your working. The complexity that makes AI so powerful (its ability to process thousands of variables simultaneously) is often the exact same thing that makes it difficult to interrogate. A model that detects fraud in milliseconds is impressive. But if nobody can articulate why it raised the flag, the institution is exposed the moment that decision gets challenged. [The CFA Institute's work on explainable AI](https://rpc.cfainstitute.org/research/reports/2025/explainable-ai-in-finance) makes the stakes clear: transparency in finance isn't a nice-to-have governance feature, it's load-bearing infrastructure. Without it, highly accurate models remain unusable in any situation where the accountability is real and the stakes are high. You can have a model that's right 94% of the time, but if you can't explain the 6% it gets wrong (or show why it was right in the first place) it has no place in a decision that will be scrutinized. [How AI is transforming financial modeling & sales forecasting in enterprise techThis article explores how AI is transforming financial modeling and sales forecasting (two pillars of enterprise strategy) and helping finance teams shift from reactive to proactive operations.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSupreeth Meka![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/05/Copy-of-FA_Website_Article_Images_Author_Highlight--56-.png)](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) ## **Where AI earns your trust (and where it doesn't)** Not all finance decisions are created equal. The judgment call about when to trust AI isn't binary, but deeply contextual. Some areas are genuinely well-suited to AI-driven analysis. Others require [human expertise](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) in ways that current models simply can't replicate. AI performs well and earns higher trust in areas where it's processing structured, historical data at scale. [Fraud detection](https://www.financealliance.io/ai-in-risk-management-how-banks-can-mitigate-fraud-and-financial-crimes/) is the clearest example. AI is genuinely excellent at scanning transaction data for anomalies, building creditworthiness profiles from multiple data streams, and spotting cash flow irregularities that a human analyst might miss entirely buried in a spreadsheet. In these domains, AI isn't making the call, it's doing the legwork that makes a better call possible. The human still decides what to do with the finding, and that distinction matters. [More than half of finance professionals regularly use](https://tipalti.com/press/ai-in-finance-trust-gap-report/) AI for financial analysis (63%), reporting (62%), forecasting (58%), and fraud detection (57%). These are exactly the places where AI adds the most value: structured inputs, historical baselines, repeatable logic. The model's assumptions are checkable. The output is testable. Where trust gets shakier is in forward-looking, high-stakes, and politically charged decisions. [M&A strategy](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/). Board-level scenario planning. Credit decisions that are going to be scrutinized for fairness. This is where the sophistication of the model becomes a liability rather than an asset, because the more complex the algorithm, the harder it is to catch the biases baked into the training data. Models have produced discriminatory credit outcomes without any protected characteristic being explicitly included, simply because the patterns in historical data reflected historic inequities. That's a risk no finance leader should quietly accept. [AI in FP&A: What you need to knowAI in FP&A won’t make you or your role obsolete. But it will help automate routine tasks and give you more time for strategic initiatives.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/Copy-of-FA_Website_Article_Images_Doodles.png)](https://www.financealliance.io/ai-in-fp-a/) ## **Human judgment isn't the problem, it's the point** One of the more frustrating framings in the AI-in-finance conversation is the implicit suggestion that human oversight is just a temporary awkwardness we'll eventually engineer our way out of. That once the models get good enough, we won't need the human in the loop. AI doesn't eliminate the need for judgment, it raises the stakes for it. When AI is surfacing more analysis, faster, with higher apparent confidence, the human's job isn't to rubber-stamp the output. It's to bring the contextual knowledge, the ethical awareness, and the organizational accountability that the model simply doesn't have. The judgment call becomes *more* important, not less. [IMD's research on the evolving CFO role](https://www.imd.org/ibyimd/artificial-intelligence/ai-and-the-cfo-financial-leadership-in-the-ai-era/) makes a similar point: the skills that matter now aren't just technical. Finance leaders need to be able to read a model's output critically, communicate what it actually means to non-finance stakeholders, and build teams that combine domain expertise with enough AI fluency to know when to push back. That's a different kind of talent development than finance functions have traditionally invested in, and the teams that get it right are pulling ahead. The division of labor that's emerging in [high-performing finance teams](https://www.financealliance.io/how-to-optimize-finance-teams/) reflects this clearly. AI handles the volume work: pulling data, reconciling accounts, flagging outliers, processing invoices. The human takes the handoff at the point where judgment is required: interpreting what the anomaly means, deciding which scenario to act on, [communicating to the board](https://www.financealliance.io/how-to-communicate-financials-to-executives/) what the numbers actually imply for strategy. That's not a transitional arrangement while AI catches up. That's the sustainable design. [How generative AI is transforming financeFinancial advisors could use AI to generate initial investment recommendations while focusing their expertise on understanding client needs and providing personalized guidance.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/02/FA_Website_Article_Images_Doodles--9-.png)](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) ## **What good governance actually looks like** If you're trying to build a framework for when to trust AI in finance decisions, governance is the scaffolding that makes it operational. Without it, you're making trust calls on a case-by-case basis, which is exhausting and inconsistent. [Organizations are moving beyond experimentation](https://www.mckinsey.com/capabilities/tech-and-ai/our-insights/tech-forward/state-of-ai-trust-in-2026-shifting-to-the-agentic-era) toward scaled deployment, but persistent gaps remain in strategy, governance, and risk management. The maturity model matters here. Organizations that have done the governance work (defined accountability, established data quality standards, built review processes for model outputs) are the ones that can actually trust AI at scale. Everyone else is flying on intuition. [Finance professionals are calling for](https://tipalti.com/press/ai-in-finance-trust-gap-report/) stronger governance frameworks (52%), clearer accountability for AI decisions (47%), improved data lineage and quality controls (45%), and broader role-specific training (43%). These aren't abstract wishes, but the preconditions for trusting AI output at a level where it can actually influence decisions. Without clear [accountability](https://www.financealliance.io/financial-accountability/), you don't have trustworthy analysis. You have plausible-sounding output with no one responsible for its accuracy. A practical governance approach has a few key elements: - First, you need to know who owns the AI output. Someone has to be accountable for validating the model's assumptions, checking the data inputs, and signing off that this analysis is fit for the decision it's being used to support. - Second, you need a consistent review process, not just for exceptional cases, but as standard practice. - Third, you need [documentation](https://www.financealliance.io/3-pillars-of-finance-transformation/). If you can't explain what the model did and why you trusted it, you don't have decision-grade analysis. You have a black box with a recommendation attached. [Why Austin has become a hub for finance and techIf Austin shows anything clearly, it is how quickly finance can move from being a support function to the engine behind decision-making.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--24-.png)](https://www.financealliance.io/why-austin-has-become-a-hub-for-finance-and-tech/) ## **Hear it straight from the people making these calls** If this question, “when does AI-generated analysis become decision-grade?” is one you're actively wrestling with, you're not alone. And there's a session coming up that tackles it head-on. At the[ **AI-Powered Finance Summit**](https://virtual.financealliance.io/location/aifinance/) on **May 20, 2026**, Abhishek Chandna, Director of Finance Strategy at Visa, is presenting a session called **"AI handles the output, finance owns the story: Unlocking creativity in data storytelling."** It sits right at the intersection of everything this article has been building toward: the gap between what AI produces and what a finance leader can actually act on, and the human skill of bridging that gap with clarity and accountability. The summit brings together finance leaders from Amazon, Meta, Google, Adobe, Unilever, and more, across many sessions covering everything from FP&A transformation to governance at scale. Attendance is free, sessions are recorded, and you can earn up to 8 CPD credits by attending. So, if you're a finance leader trying to figure out where to actually place your trust in AI (and how to build the judgment and storytelling skills to make that trust defensible) this is exactly the room to be in. [Secure your free pass here →](https://virtual.financealliance.io/location/aifinance/) ### Most finance leaders can't fully account for their software costs. Can you? URL: https://www.financealliance.io/how-cfos-can-optimize-their-tech-stack-to-increase-exit-valuations/ Last updated: 2026-07-02T12:17:24.000Z **Most finance leaders don't lose a deal because of one bad decision. They lose value at the table because of software costs nobody ever properly reviewed.** Licenses that should have been cancelled. Renewals that went through without a second look. Spend that happened outside any formal process. None of it feels urgent until someone else is looking at it during due diligence. Will Harman spent 11 years at Apax Partners finding exactly this in businesses like yours. In this session, he and a panel of CFOs who've been through it and came out ahead will show you what to fix and how to fix it before it becomes someone else's leverage. --- ## Who you'll hear from Will Harman and a panel of CFOs who've been through carve-outs, acquisitions, and exits, and came out ahead, will share what they wish they'd known earlier. What investors are now explicitly looking for in operational due diligence. And what the finance leaders who came out ahead had in common. **If a transaction is on your horizon or should be, this is the conversation to have before you're sitting across the table from someone who's already found the problem.** --- --- ## What you'll walk away with - How to get a clean picture of your software costs from inside your existing setup, so you know exactly what you're carrying before anyone else looks at it - The specific points in a carve-out, acquisition, and exit where unreviewed software costs come off your valuation, and what to have fixed before you get there - How to get your vendor contracts and licenses into a shape that holds up under due diligence, based on what CFOs who've already been through it actually did - Exactly what investors look for when they go through your software costs, so you know where you stand before anyone starts asking - The single thing to fix in your software costs first if you want to protect your valuation, based on what finance leaders who came out ahead actually did --- ## Sound familiar? ***"Software gets bought across the business, and I find out when the invoice arrives."*** Ungoverned purchasing is how costs build up without anyone signing them off. We'll show you what procurement control looks like at high-growth businesses and how to put it in place without slowing things down. ***"We're probably paying for software nobody's using, but I don't know where to look."*** Unused licenses, duplicate tools, and uncancelled subscriptions are sitting in most businesses right now. This session gives you a clear process to find them and cut what the business has no real use for. ***"We're heading toward a transaction, and I'm not confident our contracts are in good shape."*** This session is built for that situation. You'll hear directly from someone who spent 11 years on the other side of that table, looking at exactly what you're worried about. ***"I don't have a clean picture of what we're spending on software."*** In normal operations, that's manageable. When a transaction arrives, it hands the other side something to use against you. This session shows you what a defensible cost base looks like and how quickly you can build one. **"We've just acquired a business, and inheriting their tech stack is a mess."** Duplicate tools, shadow IT, and non-compliant vendors. Acquisition integration is where software costs compound fastest. We'll cover how CFOs are cutting through it quickly and where the savings show up first. --- ## Meet the speakers [**Will Harman**](https://www.linkedin.com/in/will-harman-a20ab41/)*CEO, Trusted Value Creation · former Principal and Global Margin Expansion Lead, Apax Partners* \- Will spent 11 years at Apax Partners as Principal and Global Margin Expansion Lead, sitting on the other side of the table during due diligence and executing value creation plans during ownership. He now runs Trusted Value Creation, helping finance leaders fix the problems that show up before and during a transaction. [**Sudeepa Ghosh**](https://www.linkedin.com/in/sudeepagm/)*Global Business Finance Head (SG&A), Thoughtworks* \- Sudeepa is a global finance leader with more than 20 years of experience leading world-class FP&A and controllership functions for complex, global enterprises. Sudeepa specializes in the intersection of finance and technology, partnering closely with corporate leadership to architect large-scale G&A transformations. Her initiatives rigorously focus on ROI optimization, sustainable scalability, and driving measurable EBITDA improvement. [**Dan Boni**](https://www.linkedin.com/in/daniel-boni-7aab8613a/)*Procurement Director (Client Engagement), Vertice* \- Dan is a commercial and procurement leader, leading part of the Procurement team at Vertice and helping customers optimize their tech spend faster, more effectively, and more securely. ### What is a Fractional CFO? Definition, cost & how to hire one URL: https://www.financealliance.io/how-to-become-a-fractional-cfo/ Last updated: 2026-04-17T10:33:33.000Z As a Chief Financial Officer (CFO), you’ve undoubtedly worked tirelessly to achieve your success. But have you ever wondered what it would feel like to have complete control over your own schedule and [work-life balance](https://www.financealliance.io/finance-talent/)? By [becoming a fractional CFO](https://www.financealliance.io/transitioning-to-fractional-financial-leadership-how-to-lead-in-2-4-days/), you can use your expertise to help multiple companies grow while also having the time and energy to enjoy your own life. In fact, many CFOs have left full-time positions to regain control of their [careers](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) *and* their time. But how did they do it? That’s what you’ll find out in this blog post as we uncover how to become a fractional CFO. ## **What is a fractional CFO?** A [fractional CFO](https://www.financealliance.io/guide-to-company-growth/), also known as a part-time CFO or interim CFO, is a Chief Financial Officer who works for various companies on a part-time or by-project basis. This flexible way of working allows startups and [small businesses](https://www.financealliance.io/17-finance-business-processes/) to access the same level of financial expertise and strategic guidance as a full-time CFO *without* the overhead costs associated with hiring a full-time employee. Fractional CFOs help businesses with everything from [financial reporting](https://www.financealliance.io/financial-charts-and-graphs/) to [budgeting](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/) can and strategic planning. For the most part, they work on a contract or consulting basis with a services and/or retainer agreement in place. ## **What does a fractional CFO do?** Fractional CFO services involve a variety of responsibilities, such as: - Funding and negotiations - [Budget and resource allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) - Optimizing financial operations, strategies, and internal processes - Supporting [senior management](https://www.financealliance.io/why-cfos-need-to-be-people-managers/) with [data-driven](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) decisions - Overseeing regulatory procedures and changes - Managing [cash flow](https://www.financealliance.io/3-cash-flow-forecasting-challenges/) - Raising capital - Forecasting finances - Support during an [acquisition or merger](https://www.financealliance.io/podcast/how-to-survive-a-post-merger-integration/) - Routine bookkeeping and accounting [Top 20 Q’s from Fractional CFOsHere are the top 20 questions you might have when planning the transition to fractional CFO…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-36.png)Finance AlliancePeter Turner![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-2.png)](https://www.financealliance.io/top-20-qs-from-fractional-cfos/) ## **How an outsourced CFO works alongside your team** One of the most common questions from business owners is, “How will an outsourced CFO actually fit in with my current accounting team or [bookkeeper](https://www.financealliance.io/finance-careers-how-many-jobs-are-available-in-finance/)?” It’s a fair concern. Nobody wants confusion, duplicated work, or turf wars. Here’s how integration usually plays out in the real world. Think of your bookkeeper or accounting team as the foundation: they handle daily transactions, payroll, invoicing, and make sure the numbers are accurate and up-to-date. The outsourced CFO builds on that foundation, [using the data](https://www.financealliance.io/mastering-data-storytelling/) your team provides to drive higher-level analysis, strategic planning, and decision-making. In practice, this means the CFO sets the agenda for financial reporting, cash flow [forecasting](https://www.financealliance.io/14-dos-and-donts-financial-forecast/), and [budgeting](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/), while the accounting staff handle the nuts and bolts. For example, your bookkeeper might close the books each month, and the CFO reviews those numbers to identify [trends](https://www.financealliance.io/9-upcoming-trends-that-ransforming-fp-a/), flag risks, or prepare materials for investors and the board. [Communication is key](https://www.financealliance.io/how-wayfair-made-me-rethink-everything-i-knew-about-finance/): regular check-ins, clear reporting lines, and defined responsibilities keep everyone rowing in the same direction. Worried about overlap? A good outsourced CFO will clarify roles from day one. They’ll often introduce new processes or [tools](https://www.financealliance.io/10-best-financial-modeling-tools/), but always in partnership with your team, not as a replacement. In fact, many bookkeepers and [controllers](https://www.financealliance.io/cfo-vs-controller/) find their work becomes more impactful with a CFO’s strategic guidance. The result is a more cohesive, empowered finance function that supports your business goals without stepping on anyone’s toes. [Top CFO interview questions and answers you should knowIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--25-.png)](https://www.financealliance.io/cfo-interview-questions-and-answers/) ## **Is a fractional CFO the same as a full-time CFO?** Although the two share similarities, a fractional CFO and a [full-time CFO](https://www.financealliance.io/how-to-prepare-for-a-financial-crisis/) are notquite the same. They have similar [skills and responsibilities](https://www.financealliance.io/top-10-fp-a-skills-to-master/), but with a few key differences: ### **1\. Time commitment** A CFO typically works on a full-time basis, while a [fractional CFO](https://www.financealliance.io/making-the-move-stepping-into-fractional-success-2/) can be hired for a more flexible arrangement. This could involve working part-time or only for the duration of a specific project. ### **2\. Scope of responsibility** CFOs are tasked with overseeing all the financial activities of a company, which includes everything from [financial planning](https://www.financealliance.io/11-must-read-fp-a-books/) and forecasting to compliance and risk management. However, a fractional CFO may have a more focused role, providing support for specific financial areas, such as reporting, [analysis](https://www.financealliance.io/cost-benefit-analysis/), or strategic planning. ### **3\. Company size** CFOs typically work for larger companies that have more complex [financial operations](https://www.financealliance.io/operational-finance/), while fractional CFOs often work with smaller or mid-sized companies. This is because smaller companies and startups may not have the [resources](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) to hire a full-time CFO, but still need the expertise of a financial executive to help manage their [operations](https://www.financealliance.io/17-finance-business-processes/) and growth. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/04/Fractional-CFO-vs.-full-time-CFO.png) **Company cost (fractional)**: The average fractional engagement in 2026 runs $3,000–$12,000/month. Typical saving of 50–80% vs full-time with no [benefits](https://www.financealliance.io/cost-benefit-analysis/), payroll taxes, or equity dilution. **Company cost (full-time)**: A full-time CFO commands $250K–$400K in base salary, rising to $350K–$600K fully-burdened with bonus, benefits, payroll taxes, and equity. **Ideal company stage (full-time)**: The revenue threshold for justifying a full-time hire has edged upward. Full-time CFOs are best suited for companies exceeding $20M in annual revenue, or those managing complex structures such as multiple divisions, subsidiaries, or heavy regulatory oversight. The CFO role in 2026 looks very different from five years ago, with today's financial leaders integrating data analytics, automation, and AI forecasting into day-to-day decision-making. This explains why fractional CFO rates have risen even as the model remains far cheaper than a full-time hire. ## **Fractional CFO vs. outsourced controller** It’s easy to see why business owners and founders sometimes mix up the roles of a fractional CFO and an outsourced [controller](https://www.financealliance.io/cfo-vs-controller/). Both are external finance experts, but their focus, impact, and the value they bring to your business are quite distinct. Let’s break it down. A fractional CFO is your strategic partner. They’re thinking big picture: long-term [financial planning](https://www.financealliance.io/10-big-picture-financial-planning-steps/), fundraising, scenario modeling, and helping you chart the course for [sustainable growth](https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/). They’ll work with you on capital structure, investor relations, and even [M&A strategy](https://www.financealliance.io/risks-of-mergers-and-acquisitions/). If you’re asking questions like, “How do we scale profitably?” or “What’s our cash runway if we launch a new product?”, that’s where a fractional CFO shines. An **outsourced controller**, on the other hand, is all about the numbers behind the scenes. Think of them as the guardians of your financial data: managing the monthly close, ensuring compliance, maintaining internal controls, and delivering accurate, timely [financial statements](https://www.financealliance.io/financial-charts-and-graphs/). They’re essential for keeping your books clean and audit-ready, but they’re typically not driving strategic change or advising on high-level financial decisions. Here’s a quick side-by-side: - Fractional CFO: Strategic planning, forecasting, capital raising, board reporting, scenario analysis, [M&A support](https://www.financealliance.io/m-a-best-practices/). - Outsourced controller: Month-end close, GAAP compliance, process documentation, audit prep, [financial reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/), internal controls. **So, when should you hire each?** If you’re facing rapid growth, fundraising, or need high-level [financial leadership](https://www.financealliance.io/top-10-cfo-skills/), a fractional CFO is the way to go. If your main concern is accurate reporting, compliance, and process improvement, an outsourced controller is your best bet. Sometimes, companies need both. Controllers to keep the financial engine running and CFOs to steer the ship. The key is understanding what your business needs right now, and building your [finance team](https://www.financealliance.io/fp-a-team-structure/) accordingly. ## **When does a company need a fractional CFO?** If you're considering becoming a fractional CFO, it's important to know when a company might need your services. ![](https://media.tenor.com/DFR8rpSRYOQAAAAC/the-time-has-come-michael-scott.gif) A company’s financial needs change as it scales. In the early stages of [growth](https://www.financealliance.io/guide-to-company-growth/), a company might start building a finance team by first hiring a bookkeeper for basic accounting duties. Next on the priority list is usually a controller, who’ll perform [financial planning](https://www.financealliance.io/10-big-picture-financial-planning-steps/) activities. When companies have scaled enough that the complexity of finance requires more expertise, they’ll often consider hiring a fractional CFO. There are a few tell-tale signs when a company is ready for a fractional CFO, including: - **Growth:** Companies experiencing rapid [growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) may need a fractional CFO to help manage their finances and strategize for the future. As the company grows, [financial planning and analysis](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) become more complex and time-consuming, and a fractional CFO can help keep everything on track. - **Special projects:** Some companies want help with a specific project or initiative. For example, if a company is looking to raise capital or acquire another business, a fractional CFO can provide expertise and guidance throughout the process. - **Cost savings:** A fractional CFO can provide the same level of [expertise](https://www.financealliance.io/top-10-fp-a-skills-to-master/) and guidance as a full-time CFO but at a lower cost. - **Interim needs**: If a company's full-time CFO leaves or is on leave, a fractional CFO can fill the gap until a permanent replacement is found. - **Scalability:** A fractional CFO can easily adjust their level of involvement based on the company's needs and resources. ## **Interim or long-term outsourced CFO?** You might be wondering: should you bring in an interim CFO, or is a long-term outsourced CFO service a better fit? The answer depends on your company’s current stage and the [challenges](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/) you’re facing. An interim CFO typically steps in during a period of transition or crisis. Maybe your CFO just left unexpectedly, you’re [in the middle of a merger](https://www.financealliance.io/m-a-best-practices/), or you need someone to steady the ship while you search for a permanent hire. Interim CFOs are experts at jumping into the unknown, quickly assessing the situation, and providing stability. Their focus is short-term: they fill the [leadership](https://www.financealliance.io/cfo-leadership-pillars/) gap, maintain continuity, and often help with urgent priorities like audits, restructurings, or investor communications. Once the dust settles or a permanent CFO is found, their role wraps up. A long-term outsourced CFO, on the other hand, is all about building a relationship and driving sustained value. These professionals become embedded in your leadership team, guiding strategic planning, [forecasting](https://www.financealliance.io/14-dos-and-donts-financial-forecast/), and growth initiatives over months or even years. They’re ideal for companies that need ongoing financial expertise but don’t require (or can’t yet afford) a full-time CFO. If you’re scaling, entering new markets, or want to professionalize your finance function for the long haul, this model delivers continuity and deep institutional knowledge. So, how do you decide? If you’re facing a sudden leadership gap or a one-off event, an interim CFO is your go-to. If you want to invest in strategic [finance leadership](https://www.financealliance.io/financial-leadership-in-changing-times-2/) for the long-term, an outsourced CFO is the better choice. Take a moment to assess your business timeline, goals, and pain points, then choose the model that aligns with where you are and where you want to go. ## **Red flags when hiring a fractional CFO** The fractional CFO market has grown fast, and so has the number of bookkeepers, controllers, and accounting generalists rebranding themselves as fractional CFOs. The label "fractional CFO" is broad. Some are true strategic finance operators. Others are expensive scorekeepers with fancy spreadsheets. Here's how to tell them apart before you sign a contract. ### **Their proposal is full of backwards-looking deliverables** Bookkeepers and controllers tell you what happened. A real fractional CFO tells you what's going to happen and what to do about it. Be alert to too much focus on historical reporting with little [future planning](https://www.financealliance.io/key-trends-shaping-the-future-of-finance/). If a proposal is heavy on monthly closes, reconciliations, and compliance work but light on forecasting, scenario modelling, and strategic planning, you're likely looking at a controller dressed up as a CFO. ### **They can't point to specific results** An experienced fractional CFO should be able to clearly demonstrate the specific impact they’ve had on revenue growth, financial runway, or company valuation for their previous clients. If their responses are unclear or non-specific, it’s a warning sign. Ask directly: what did you do for your last three clients and what measurably changed? A strategic CFO should be able to answer in concrete terms: funding closed, cash runway extended, margins improved. If you get generalities, keep looking. [Data storytelling for FP&AWhat do Barack Obama, Oprah Winfrey, and Nikki Glaser have in common? They all excel in storytelling...and you can do (yes, even as a finance professional!). Here’s how…![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceMathew Reynders![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/01/Copy-of-FA_Website_Article_Images_Author_Highlight--37-.png)](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/) ### **They quote an hourly rate without asking about your scope** Skilled fractional CFOs base their fees on the value they bring to your project. If a candidate provides an hourly rate without first assessing your business’s needs, objectives, and complexity, it reveals their approach to the role. Additionally, unusually low rates can be telling. True strategic CFO services command higher fees than those of [accountants](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/) or bookkeepers. ### **They don't ask about your cap table or equity structure early** A competent fractional CFO will prioritize understanding your [equity](https://www.financealliance.io/acquisition-financing/) setup, capital structure, and investor dynamics before committing to an engagement. If these topics aren’t among their initial inquiries, they may not be approaching the role with a CFO mindset. Remember, while controllers focus on financial records, CFOs are responsible for aligning your financial strategy with [stakeholder](https://www.financealliance.io/stakeholder-communication-plan/) interests. ### **They talk more than they listen** Be cautious if a fractional CFO dominates the conversation rather than engaging in a dialogue. Effective CFOs prioritize understanding your business before offering models or advice. They should actively listen, [pose insightful questions](https://www.financealliance.io/cfo-interview-questions-and-answers/), and build trust through every interaction. A candidate who presents a pre-packaged solution without first grasping your unique situation is likely offering a generic service, not a tailored strategic partnership. ### **They can’t define what success looks like in 60 days** If a fractional CFO cannot clearly outline how you’ll measure success after two months days, you risk entering an undefined advisory arrangement rather than a results-driven engagement. Professional execution requires clarity: the specific change, the responsible party, the deadline, and the criteria for completion. So, always ask this question during interviews: "How will we know this is working in 60 days?" A strategic CFO will provide a concrete response. ### **They have no relevant industry experience** While a generalist may be able to oversee routine financial tasks, strategic CFO work requires deep industry knowledge. For instance, a manufacturing company expanding into new markets needs a CFO who understands [supply chain](https://www.financealliance.io/why-supply-chains-determine-post-merger-success/) financing, [inventory](https://www.financealliance.io/how-to-forecast-inventories/) turnover ratios, and cost optimization strategies specific to production environments. Hiring a CFO without relevant experience can result in misaligned priorities and missed opportunities. During interviews, ask candidates to explain the critical financial [metrics](https://www.financealliance.io/cost-benefit-analysis/) that drive decision-making in your industry; if their responses lack specificity, it’s a sign they may not be the right fit. [Month-end close checklist: Steps, process & best practicesWhether you’re a seasoned finance pro or just starting, we’re here to guide you through the process. We’ve got some handy checklists, nifty tips, and a few tricks up our sleeve to transform your month-end close from a frantic scramble into a streamlined process.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/FA_Website_Article_Images_Doodles--19-.png)](https://www.financealliance.io/month-end-close-checklist/) ## **How to find and vet a fractional CFO** Knowing you need a fractional CFO is one thing. Finding the right one without wasting weeks on the wrong candidate is another. Here's a practical step-by-step process to source, evaluate, and onboard a fractional CFO who will genuinely move the needle for your business. ### **Step 1: Define what you need before you start searching** Before you speak to a single candidate, get specific about the outcomes you want. - Are you preparing for a fundraising round? - Trying to get visibility over cash flow? - Building investor-grade reporting from the ground up? The sharper your brief, the faster you'll identify the right person, and the less likely you are to end up paying strategic CFO rates for work a good controller could handle. Also decide whether you want an individual consultant or a firm. Firms typically bring a supporting layer of controllers and analysts beneath the CFO, which can speed up delivery in the early months. An independent CFO may offer deeper personal involvement, but comes with a single point of failure if they're pulled elsewhere. ### **Step 2: Use the right sourcing channels** Where you look largely determines who you find. **Founder referrals** are the warmest and most reliable starting point. Ask founders in your network who are one or two stages ahead of you. After all, they've already worked through the same problem and can give you an honest account of what it was actually like to work with a specific person. Your VC or investor network can be equally valuable; many funds maintain informal lists of fractional CFOs they trust with portfolio companies. **Specialist CFO firms and networks.** Firms like CFO Hub, Preferred CFO, FLG Partners, and KORE1 maintain rosters of vetted [finance leaders](https://www.financealliance.io/how-cfos-power-business-strategy/) and can match you to a candidate quickly, often within a couple of weeks. The trade-off is cost: you pay for the quality assurance and speed, so make sure the firm takes time to understand your stage and strategy before putting names forward, not just your job description. [**LinkedIn**](https://www.linkedin.com/company/finance-alliance/) is effective if you're willing to be methodical. Search "Fractional CFO" alongside your industry or city. The most important thing to look at is career history; has this person actually held a full-time CFO role, or have they moved into fractional work from a controller or FP&A background? The distinction matters enormously for the kind of strategic support you'll get. **Curated marketplaces** like Toptal offer access to pre-screened senior finance professionals and typically include a trial period so you can assess fit before committing fully. This is a strong option when you need someone quickly and want a baseline of quality assurance built into the process. ### **Step 3: Evaluate on the criteria that actually matter** Most hiring mistakes happen because companies assess CFO candidates the same way they'd assess an accountant. Strategic CFO work requires a different evaluation lens. **Look for a genuine full-time CFO track record** A fractional CFO should have occupied the seat before, not just worked near it. Ask them to walk you through a company they took from one growth stage to the next: what the financial situation looked like when they arrived, what they changed, and what it looked like when they left or handed over. **Prioritise industry and stage fit over credentials** A CFO who excelled inside a $200m manufacturing business may bring very little that's useful to a pre-Series A SaaS startup. Ask candidates to name the metrics that investors in your sector focus on and how they'd approach building your financial model. The quality of those answers tells you more than any [certification](https://certified.thealliance.io/fa-certifications). **Ask for founder references, not colleague references** Request two or three references from CEOs or founders at companies of a similar size and stage to yours, not former colleagues or board members. The most revealing question to ask isn't whether the CFO was good, it's what they weren't good at, and how they responded when it was raised directly. **Test how they scope the work** Before any engagement begins, your financial infrastructure matters as much as the CFO's experience. A business with clean books and solid systems needs a CFO focused on strategy. A business with disorganised financials needs someone willing to establish foundations first. A candidate who doesn't ask about your existing setup (your accounting team, your tools, your close process) before scoping an engagement isn't doing their homework. [How finance is evolving from reporting to innovationIs your finance team seen as a roadblock? Discover how to evolve finance from a cost center to a strategic driver of innovation and growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-222.png)Finance AllianceSiqi Chen![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--3.png)](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) ### **Step 4: Set clear expectations for the first 90 days** A [structured first 90 days](https://www.financealliance.io/your-first-90-days-as-cfo/) is the strongest predictor of whether an engagement delivers lasting value. Here's what each phase should look like, and what you should hold your CFO accountable for. **Month one — diagnosis and stabilisation** The priority in the opening weeks is gaining a clear picture of where the business stands financially: reviewing your accounts, identifying gaps in [reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/), understanding cash flow and runway, and meeting the people behind the numbers. Give your CFO immediate access to your accounting software, bank accounts, and key financial documents from day one. Delayed access is one of the most common (and avoidable) reasons early engagements lose momentum. **Month two — building the financial operating system** With the diagnosis complete, the CFO shifts from observation to action: building or rebuilding a forecasting model, establishing meaningful KPIs, and implementing a regular reporting cadence. This is the phase where your CFO should start showing up in leadership conversations, not just finance ones. Their work should be visible to department heads and influencing real decisions. **Month three — strategy and forward planning** By the end of the third month you should have a written financial roadmap, a set of agreed metrics the whole leadership team tracks, and early evidence of the improvements identified in the diagnostic phase. If none of that has materialised, that's the point to have a direct conversation, not six months later when sunk costs have piled up. One realistic expectation to set: meaningful ROI typically emerges in months four and five, once the foundation built in the first 90 days starts driving real decisions. The first three months are an investment in getting the financial infrastructure right, not an immediate return on your spend. ## **The benefits of being a fractional CFO** If you’re considering leaving full-time employment, a fractional Chief Financial Officer (CFO) role might be for you. To help you decide, here are some of the main [benefits](https://www.financealliance.io/cost-benefit-analysis/) of being a fractional CFO for start-ups and small to medium sized businesses: ### **1\. Flexibility** As a fractional CFO, you have the power to control your own schedule. No more being tied to a 9-to-5 grind! You can work on a part-time or project basis. This type of schedule gives you the freedom to prioritize what matters most in your life. Whether it's spending more time with family or pursuing other interests, being a fractional CFO means your schedule is *yours*. ### **2\. Variety** Tired of working with the same clients day in and day out? Fractional CFOs tend to work with a diverse range of clients across different industries and growth. From [start-ups](https://www.financealliance.io/5-startup-vc-funding-tips/) to [enterprises](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/), you can offer your expertise and guidance to a wide range of businesses. This keeps your work fresh and exciting, while allowing you to continue learning and growing as a finance professional. ### **3\. Autonomy** You’ll have greater autonomy and control over your work. You can choose the clients you work with, set your own [rates](https://www.financealliance.io/finance-salary-report/), and determine the scope and nature of projects you work on. This level of independence allows you to be the CFO maverick, forging your own path in the financial world. ### **4\. Competitive compensation** Fractional CFOs often command competitive compensation rates, thanks to their specialized knowledge and experience. If you have a unique skill set or expertise in high-demand areas, you can earn top dollar for your expertise. ### **5\. High-impact work** By offering financial guidance and strategic advice, you can help businesses achieve their goals and succeed in a competitive market. This kind of high-impact work is rewarding and fulfilling. In many ways, you can use your financial expertise to make a real difference. ## **The essential skills of successful fractional CFOs** Being a fractional CFO is not for the faint of heart. It requires a unique blend of skills that sets you apart from the crowd. Here are the most essential [CFO traits](https://www.financealliance.io/10-cfo-personality-traits/) and skills you'll need to thrive in this role: ### **Financial mastery** Your clients need someone who can make sense of their numbers and help them make informed decisions. This means you’ll need a deep understanding of everything from financial statements to accounting principles, budgeting, forecasting, etc. ### **Strategic vision** Seeing the bigger picture and providing strategic advice to help clients achieve their business goals is a must-have skill. Therefore, you need to be an expert at [analyzing financial data](https://www.financealliance.io/8-key-principles-of-data-visualization-in-finance/). Not to mention making informed decisions that align with the client’s long-term vision. ### **Stellar communication** You must be a master communicator to succeed as a fractional CFO and explain complex financial concepts in a language your clients comprehend. ### **Time management** If you're working with multiple clients at once, time management skills will help you stay on top of deadlines and deliverables. ### **Adaptability and versatility** As a fractional CFO, you’ll work with clients across many different industries, each with its unique [financial challenges](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/). Learning about each industry and adapting your strategies and approach as required is another important skill to master in this role. [Driving innovation: From CFO “no” to strategic growth partnerDiscover how finance teams can drive innovation, not block it. Learn how strategic finance leaders enable growth through risk-balanced decisions, scenario planning, and capital allocation frameworks.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceKevwe Ijatomi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/07/Copy-of-FA_Website_Article_Images_Author_Highlight--2-.png)](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) ## **How to become a fractional CFO** Becoming a fractional CFO may seem like a daunting task. But with the right combination of [education](https://www.financealliance.io/finance-and-compliance/), experience, and networking, it's an attainable goal. Here are five tips to help you transition into the exciting world of fractional CFO services: ### **1\. Strengthen your financial foundation** To become a fractional CFO, you'll need a strong educational background in finance, accounting, or a related field. It’ll also help if you stay up-to-date with industry trends by attending [conferences and seminars](https://www.financealliance.io/events/), and reading relevant publications. ### **2\. Develop your consulting skills** To succeed in this role, strong consulting skills are a *must*. This includes understanding client needs, developing strategic plans, and communicating effectively. If you lack these [skills](https://www.financealliance.io/top-10-cfo-skills/), consider taking courses or obtaining certifications to help build them. ### **3\. Build a strong professional network** Networking is key to building a successful career as a fractional CFO. Attend[ finance events](https://www.financealliance.io/top-finance-events/), connect with other financial professionals, and build your online presence. Joining a professional organization or networking group can also help expand your network. Our free [Slack community for finance professionals ](https://www.financealliance.io/community/)is a prime example of a thriving community that can help you build a strong network and find new opportunities. ### **4\. Gain experience in a variety of industries** Consider gaining experience in different sectors to broaden your skills and expertise. This can include taking on consulting or advisory roles, or even volunteering your services to non-profit organizations. ### **5\. Join a fractional CFO network** Joining a [fractional CFO network](https://finance-alliance.slack.com/archives/C04UM4B0V5F) can provide access to clients, additional resources, and support. These networks can also provide training and development opportunities to help you grow in your role. Research different networks and determine which one aligns with your goals and values. Inside our free [Slack community](https://www.financealliance.io/community/), you'll find the[ **#fractional-cfos**](https://finance-alliance.slack.com/archives/C04UM4B0V5F) channel, where you can connect, collaborate, and share knowledge with other fractional CFOs. ## **How much can you make as a fractional CFO?** What you make as a fractional CFO varies but you can expect anywhere between $150 to $500 per hour (with $300 being the overall average hourly rate). Rates usually depend on your location, industry, and level of experience. Professionals in this position tend to set rates depending on the complexity and scope of the work requested, as well as the existing state of the company’s financials. As we've seen, fractional CFOs can make **$3,000 to $12,000** per month. ## **How to create a fractional CFO services agreement** As with any business arrangement, it's important to have a solid agreement in place to ensure that both parties are on the same page. For fractional CFOs, this typically means having a Fractional CFO Services Agreement that outlines the scope of services, duration of engagement, fees and compensation structure, and other important details. This agreement serves as a contract between you and your client, providing a clear understanding of expectations and responsibilities. It also helps to ensure that everyone is in agreement when it comes to the deliverables and [timelines](https://www.financealliance.io/budget-timelines/). But it's not just about protecting yourself legally. Having a strong service agreement can also help to build trust and credibility with your clients. By clearly outlining the terms of the engagement, you demonstrate your professionalism and commitment to providing quality services. Of course, developing a solid services agreement isn't something you should do alone. It's important to work with an attorney who can help you navigate the legal complexities and tailor the agreement to your specific needs. With their guidance, you can create a document that not only protects your interests but also helps to set the stage for a successful and productive engagement. [Why most finance professionals feel underpaidIf you feel underpaid in your current role, you’re not alone. The data shows that this is a widespread experience across the profession.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--23-.png)](https://www.financealliance.io/why-most-finance-professionals-feel-underpaid/) ## **A new era of CFOs: pros and cons** The rise of fractional CFOs is changing the game when it comes to financial leadership. These talented professionals are redefining what it means to be a CFO in the modern business world, bringing flexibility, expertise, and innovation to the table. With the benefits of fractional work becoming more and more apparent, it's no wonder that so many CFOs are leaping into this exciting realm. But is it always a good idea to transition to a fractional role as a CFO? Below, we look at some of the main pros and cons: ### Pros: - **Flexibility:** You’ll have more control over your schedule. - **High demand:** As more businesses turn to fractional CFOs, there are plenty of opportunities available. - **Variety of work:** You’ll get to work with a range of clients, providing exposure to different business models and industries. - **High earning potential:** You can command higher rates than traditional CFOs due to your expertise and specialized services. ### Cons: - **Uncertainty:** As a freelancer, you face a level of uncertainty when it comes to finding new clients and maintaining a steady income. - **No benefits:** You may not have access to traditional benefits such as health insurance and retirement plans unless you secure them yourself. - **More administrative work:** Without a team, administrative tasks such as invoicing, taxes, and marketing will all land on your plate. - **Less job security:** There isn’t the same level of job security as traditional CFOs, and your clients may end the engagement at any time. --- ## **Frequently asked questions (FAQs)** #### What is a fractional CFO? A fractional CFO is a financial executive who provides part-time, interim, or project-based CFO services to companies in need of financial leadership and strategic guidance, without the cost and commitment of hiring a full-time CFO. #### How much can you make as a fractional CFO? Fractional CFOs make between $240,000 to $480,000 per year. The average hourly rate of a fractional CFO is $300, but rates vary depending on location, scope of a project, experience, and other factors. #### What are the qualifications of a fractional CFO? To become a fractional CFO, you’ll need a bachelor’s degree in finance, accounting, or a related field. Many fractional CFOs also have a master's degree in finance, accounting, or business administration. In addition, many fractional CFOs hold professional certifications, such as Certified Public Accountant (CPA), Chartered Financial Analyst (CFA), or Certified Management Accountant (CMA). Prior experience as a CFO or VP in Finance is also expected. #### Do you need ACCA to be a CFO? Yes, you need ACCA to be a CFO. To qualify as a CFO, you must be a qualified accountant as well as a member of a professional body such as ACCA. #### ****Is a fractional CFO worth it?** Yes, for businesses needing expert financial guidance without the cost of a full-time CFO, a fractional CFO provides great value. #### ****How much does a fractional CFO charge?** Hourly rates typically range from $150 to $500, depending on their experience and location. #### ****How much does a fractional CFO cost?** Costs vary based on scope but can range from $5,000 to $15,000 per month for part-time services. #### ****When to hire a fractional CFO?** Hire when you need strategic financial leadership for scaling, managing cash flow, preparing for funding, or navigating complex financial challenges. ### You don't need new vendors. You need a better audit. URL: https://www.financealliance.io/you-dont-need-new-vendors-you-need-a-better-audit/ Last updated: 2026-06-02T16:21:09.000Z **Your overhead costs are climbing, but the solution probably isn't what you think.** Most finance leaders assume that reducing costs means disruption: new contracts, new vendors, new systems. But the biggest savings are often hiding in plain sight, buried inside your existing setup, in the fees, redundancies, and inefficiencies you haven't had a framework to find. In this session, **Merchant Cost Consulting** will show you how to stop the leakage before it hits the P&L. --- ## What you'll walk away with - How to run a cost audit on your existing setup to uncover fees and inefficiencies you didn't know existed - Why credit card processing costs are one of the most overlooked sources of margin erosion, and how to address them - A phased, low-risk strategy to reduce overhead without switching vendors or disrupting operations - How to negotiate better terms with your current providers from a position of knowledge - The internal process changes that deliver the fastest savings, with the least risk --- ## The problems we'll be solving **"*We assumed switching vendors was our only option.*"** It rarely is. We'll show you why the biggest lever isn't who you work with, it's how you've structured the relationship. **"*Our internal processes are eating into our margins.*"** Inefficiency doesn't always look like waste. Sometimes it looks like standard operating procedure. We'll show you where to look and what to do about it. **"*We don't know where the costs are coming from.*"** Hidden fees and opaque pricing structures are by design, not by accident. We'll give you the framework to identify them and the language to push back. --- ## Meet the speakers [**Patrick MacLellan**](https://www.linkedin.com/in/patrick-maclellan-610b092b/) \- Patrick has grown with the payments industry since 2014, joining Merchant Cost Consulting in 2018 to help drive the company's rapid expansion. His client-focused approach has helped businesses across industries unlock savings they didn't know were available to them. [**Matt Rej**](https://www.linkedin.com/in/mattrej/) \- Since joining Merchant Cost Consulting in 2017, Matt has built and led a high-performing sales team focused on educating businesses about hidden processing costs. He develops enterprise-level partnerships and helps companies of all sizes reduce their payment overhead through expertise and practical strategy. ### CFO interview questions and answers: Mastering your interview URL: https://www.financealliance.io/cfo-interview-questions-and-answers/ Last updated: 2026-04-14T11:58:08.000Z Is your calendar marked for a Chief Financial Officer (CFO) interview soon? Feeling those jitters? We've all been there. That moment when your dream job is finally within reach and the only thing standing between you and that executive position is the interview. As the potential [CFO](https://www.financealliance.io/top-10-cfo-skills/), you're not just the head money person; you're a strategic partner, a leader, and the one who'll steer the [financial future](https://www.financealliance.io/key-trends-shaping-the-future-of-finance/) of the company. That's a *big* deal. The interviewer knows it, and you certainly do too. That's why they'll ask a diverse set of CFO interview questions to test you and your suitability for the role. So, the more prepared you are for those questions, the higher your odds of securing the job. In this guide, we'll help you prepare so that when you walk into that interview room ([virtual](https://www.financealliance.io/how-to-become-a-virtual-cfo/) or in-person), you'll be ready to show them exactly why you're the best person for the role. [Month-end close checklist: Steps, process & best practicesWhether you’re a seasoned finance pro or just starting, we’re here to guide you through the process. We’ve got some handy checklists, nifty tips, and a few tricks up our sleeve to transform your month-end close from a frantic scramble into a streamlined process.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/FA_Website_Article_Images_Doodles--19-.png)](https://www.financealliance.io/month-end-close-checklist/) ## **Essential CFO interview preparation** According to [IBM](https://www.ibm.com/thought-leadership/institute-business-value/c-suite-study/ceo), CEOs view the CFO as playing the most crucial role in their organizations over the next two to three years. So, landing a CFO interview is worth celebrating... but it's also [the point where the real challenge begins](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/). Your preparation needs to go beyond standard interview prep and dive deep into the company's financial DNA. Here's a focused framework to help you prepare at the right level. ### **Analyze the company's financial health** Start with the company's latest [annual report](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/), investor materials, or funding announcements. Review revenue growth, gross margin, [EBITDA](https://www.financealliance.io/ebitda-calculator-guide/), free cash flow, working capital trends, and debt levels. If the company is public, pay attention to management commentary, guidance, and [any recurring concerns in earnings calls](https://www.financealliance.io/cfos-role-in-investor-communications/). The goal is to understand the company's financial performance and identify the story behind the numbers before the interview begins. ### **Understand the company's capital structure** Research how the business is funded. Is it bootstrapped, PE-backed, venture-backed, or public? Look for clues about leverage, refinancing activity, equity raises, [acquisitions](https://www.financealliance.io/acquisition-financing/), and [capital allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) priorities. You should be ready to discuss how capital structure may affect [growth](https://www.financealliance.io/guide-to-company-growth/) options, risk tolerance, and financial strategy. ### **Study the regulatory and compliance landscape** Every CFO role sits within a [compliance](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) context. Be prepared to speak to the standards and frameworks most relevant to the business, such as GAAP, IFRS, SOX, tax requirements, and industry-specific regulations. This shows that you understand a CFO's responsibility not just to drive growth, but to [protect the business through disciplined governance](https://www.financealliance.io/finance-and-compliance/). ### **Review the finance technology stack** Try to identify the company's core financial systems, including ERP, FP&A, BI, and [reporting](https://www.financealliance.io/how-to-communicate-financials-to-executives/) tools. If possible, learn whether they use systems such as NetSuite, Oracle, SAP, Workday, Power BI, or Tableau. PwC found 60% of FP&A data requires manual manipulation, and over 80% of FP&A work still happens in offline spreadsheets and databases. That's why you should be ready to talk about your finance systems, [automation](https://www.financealliance.io/secure-by-design-fp-a-automating-planning-without-expanding-the-fraud-surface/) plan, and how you'll speed up reporting so leaders can make better decisions. [FP&A career path and salary guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/02/FA_Website_Article_Images_Doodles--10-.png)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) ### **Identify the most important financial metrics** The right financial [metrics](https://www.financealliance.io/32-cfo-kpis/) depend on the industry. For example: - SaaS: ARR, gross retention, net revenue retention, CAC, LTV, burn multiple - Manufacturing: inventory turnover, gross margin, EBITDA, working capital, [cash flow](https://www.financealliance.io/cash-flow-drivers-in-a-business/) conversion cycle - Retail: same-store sales, gross margin, stock turns, operating cash flow Know which metrics matter most and be prepared to explain how you use them to improve financial performance. ### **Research recent financial decisions** Look for recent acquisitions, restructuring activity, pricing changes, layoffs, expansion plans, debt events, or major technology investments. These decisions often reveal the company's priorities and pressure points. Referencing them thoughtfully in the interview signals commercial awareness and strategic alignment. ### **Prepare your leadership narrative** At CFO level, technical strength isn't enough. Prepare examples that show how you've [led teams, influenced cross-functional decisions](https://www.financealliance.io/cfo-leadership-pillars/), improved [forecasting](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/), strengthened compliance, managed risk, or guided transformation. Use measurable outcomes wherever possible so your experience feels specific, credible, and executive-ready. [Mastering data storytelling: Turning numbers into actionWant to learn how to transform your data into powerful narratives that shape the future of your business?![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSharon Mahoney![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/01/FA_Website_Article_Images-Text--2-.png)](https://www.financealliance.io/mastering-data-storytelling/) ## **Your pre-interview checklist** According to [IBM](https://www.ibm.com/thought-leadership/institute-business-value/c-suite-study/ceo), CEOs view the CFO as playing the most crucial role in their organizations over the next two to three years. So, landing a CFO interview is worth celebrating... but it’s also the point [where the real challenge begins](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/). To succeed in your interview, you must be prepared to answer a variety of common, behavioral, and strategic questions for a CFO. Here are some pre-interview preparation tips to help you prepare: ### **1\. Company research** - **Understand the company’s business model:** What do they do? Who are their customers? What is their value proposition? - **Financial health and performance:** Review financial reports, recent earnings calls, and any available analyst reports. - **Company culture and values:** What do they stand for? What is their [mission and vision](https://www.financealliance.io/cfo-mission/)? - **Key leadership and board members:** Who are the current executives and what are their backgrounds? - **Recent news and developments:** Has the company been in the news recently? Any new product launches or partnerships? ### **2\. Industry analysis** - **Understand the industry dynamics:** Who are the major players? What are the key trends and challenges? - **Regulatory environment:** What are the key regulations affecting the company and industry? - **Competitive landscape:** Who are the company's main competitors, and how do they compare in terms of product, market share, and financial performance? ### **3\. Financial landscape** - **Company's financial strategy:** Is the company growth-focused or profit-focused? Is it investing in new products or focusing on [cash flow](https://www.financealliance.io/cash-flow-drivers-in-a-business/)? - **Financial KPIs:** Understand the company's key financial metrics and how they have been performing in these areas. - **Risk factors:** Based on the company and industry analysis, what are potential [financial risks](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) the company may face? ### **4\. Role-specific preparation** - **Revisit your successes and challenges:** Be ready to discuss your key achievements, learning moments, and how you've driven financial strategy in the past. - **Alignment with the role:** Identify specific examples from your experience that align with the CFO role and [responsibilities](https://www.financealliance.io/top-10-cfo-skills/). - **Understand their needs:** From the job description and your research, identify the key needs of the company and how you can address them. ### **5\. Questions for the Interviewers** - **Prepare thoughtful questions:** Remember, an interview is a two-way process. Prepare questions that show your interest in the role and the company. ### **6\. Practical preparation** - **Know the logistics:** Double-check the interview time, location (or video call link), who you'll be meeting with, and any materials you should bring or prepare. - **Professional attire:** Plan your outfit to present yourself professionally, matching the company's dress code. ## **CFO interview questions and answers (examples)** When you walk into that room (or log into that video call) for your CFO interview, it's important to understand the structure you're stepping into. Typically, a CFO interview comprises a variety of question types designed to assess your aptitude from multiple angles. Below, you'll find a selection of potential CFO interview questions that you might encounter, along with illustrative examples of how you could construct your responses. *Remember, these examples are meant to guide and inspire your own unique answers and shouldn't be taken as gospel! They are more generic answers whereas you can bring your unique experiences and personality to the table.* ### **1\. General interview questions for a CFO** Even senior executive roles have to answer the usual (and often mundane) questions asked in *most* job interviews. These are used to break the ice and help the interviewer get to know you better. You can expect the usual contenders, such as: **Q. Why are you looking for a new job opportunity?** Example response: > *"I've had a rewarding journey at my current organization, overseeing financial strategy and contributing to the company's growth. However, I'm seeking new challenges and opportunities to leverage my financial expertise and leadership skills on a larger scale. Your company's vision resonates with me and I believe my experience aligns well with your strategic goals."* **Q. What do you know about our company and why would you like to work here?** Example response: > *"I've been following your company's growth and achievements in the market. Your commitment to innovation and customer-centric approach sets you apart. I'm particularly impressed by your recent initiatives in sustainability and digital transformation...* > *"As CFO, I'd love to contribute to this forward-thinking and progressive environment, driving financial strategy that aligns with your organizational values."* **Q. Why are you capable of taking on the level of responsibility the role of CFO requires?** Example response: > *"With over 15 years of progressive leadership experience in finance, I've successfully navigated through various financial scenarios and driven strategic growth in previous roles...* > *"I've built efficient teams, implemented robust financial processes, and helped steer companies towards their financial goals. I'm confident in my ability to bring this depth of experience to your company, guiding the financial strategy and contributing to your overall vision."* Other examples of general questions for a CFO interview include: - Why do you think you're the right fit for this position? - How have your previous experiences prepared you for the role of CFO in our company? - How do you keep up-to-date with the latest industry trends and regulations? - Do you have any questions about the job or our company? - What do you consider to be your greatest professional accomplishment? 💡 Remember, your responses to these questions give the interviewers a window into your ****motivations**, your ****understanding** of the role, and your ****knowledge** about their company. Use these opportunities to demonstrate why you're the right fit for the position. ### **2\. Strategic questions** These questions assess your ability to think big-picture and long-term. They gauge how well you can strategize, align business objectives with financial goals, and drive growth. Examples might include: **Q. How would you handle the financial planning for our company's expansion into a new market?** Example response: > *"My approach would begin with a thorough market analysis to understand the potential opportunities and risks. I would closely examine customer behavior, competition, and local regulations. Concurrently, I'd work with the team to project realistic revenue targets and associated costs...* > *I'd also factor in initial setup costs, such as marketing to build brand awareness and any infrastructure or logistics expenses. These would form the backbone of our financial model. Once we've launched, it would be vital to monitor financial performance closely against our projections and adjust our plan as necessary."* **Q. Can you describe a time when your financial strategy resulted in significant company growth?** Example response: > *"In my previous role at XYZ Corp, I noticed we were sitting on substantial cash reserves earning minimal interest. I proposed an investment strategy to use a portion of those reserves to invest in growth initiatives and high-yield safe investments...* > *After gaining buy-in from the board, we were able to fund two new product lines without external funding. Both products performed exceptionally well in the market, increasing our revenue by 18% in the first year after launch. The remainder of the cash reserves invested saw a return rate of 8%, significantly higher than the interest it was initially earning."* **Q. Can you tell me about a time when you initiated an organizational change?** Example response: > *"At my previous company, I initiated a transition to a new, more advanced financial management system. I realized that our existing system was outdated and inefficient, which led to delays in financial reporting and analysis...* > *"After careful vendor evaluation and testing, I presented my proposal to the executive team and led the transition once approved. The new system improved our financial analysis capabilities, increased reporting speed by 40%, and ultimately led to better, data-driven decision-making across the organization."* **Q. How do you apply financial strategies to solve business problems?** Example response: > *"In my view, financial strategy is a powerful tool to address a range of business problems. For instance, if a company is struggling with cash flow, I'd first conduct a thorough analysis to identify the root cause. Maybe our receivables cycle is too slow, or there are inefficiencies in our inventory management.* > *"Once I've identified the issue, I'd develop a strategy to address it, whether that's implementing stricter payment terms, investing in inventory management software, or even renegotiating with suppliers. The key is to use financial data not just to identify the problem, but also to monitor the effectiveness of the solution implemented."* Other examples of strategic questions: - How would you go about aligning the company's financial strategy with its overall business goals? - What financial metrics do you consider most important for our company and why? - Describe a strategic initiative you led that required significant cross-departmental collaboration. What were the outcomes? - How do you balance short-term financial pressures with long-term strategic goals? - How have you utilized technology or [digital transformation](https://www.financealliance.io/what-is-finance-transformation/) in past roles to improve financial processes and strategy? [Building flexibility into your financial strategyTD Bank’s Bill Fink shares how today’s CFOs can lead with foresight by building adaptable financial strategies rooted in data, planning, and cross-functional teamwork.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceWilliam Fink![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/07/Copy-of-FA_Website_Article_Images_Author_Highlight--67--2.png)](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/) ### **Tip: Focus on the future** Strategic questions are aimed at gauging your ability to think long-term and envision the future direction of the company from a financial perspective. When answering these questions, it's important to demonstrate that you understand not only the current financial situation but also how your strategic decisions will impact the future of the company. Begin your answer by acknowledging the present situation or challenge and then shift your focus to future outcomes. Describe the steps you would take to achieve the desired state, how you would engage other stakeholders, and the metrics you would use to measure success. For instance, if asked how you would support the company's growth, you might discuss investing in new technology to improve financial efficiency, adopting a more aggressive investment strategy, or optimizing the company's capital structure. Each of these strategies implies a future focus and a drive to move the company forward. Remember to align your strategy with the broader business goals and the specific context of the company. Demonstrate your ability to balance risk and reward, and to adapt your strategy in response to changing circumstances. Lastly, being able to articulate complex strategic ideas in clear, accessible language is a key skill for a CFO. Practice explaining your strategic approach in a way that non-financial stakeholders would understand, as this reflects your ability to lead and influence across the organization. ### **3\. Operational questions** These delve into your ability to oversee the day-to-day [financial operations](https://www.financealliance.io/operational-finance/) and management of the company. Interviewers want to see how well you handle regular financial tasks, resource allocation, and efficiency improvements. Here are a few examples: **Q. How have you improved financial processes in your previous roles?** Example response: > *"In my last role, I realized our month-end reporting was taking too long and creating bottlenecks. I led the implementation of a new financial reporting software that automated many manual steps, improving accuracy and reducing our reporting cycle by a week. This enabled more timely decision-making across the organization."* **Q. How would you go about reducing operating costs for our company?** Example response: > *"Reducing operating costs begins with a thorough understanding of where the money is going. I would start by conducting a cost analysis to identify any areas of inefficiency or waste. This could involve everything from renegotiating contracts with suppliers to investing in technology to improve productivity."* **Q. What kinds of finance and accounting tools do you use on the job?** Example response: > *"I'm well-versed in a range of finance and accounting tools. In terms of software, I've worked extensively with Oracle NetSuite for enterprise resource planning and QuickBooks for small business accounting. I also frequently use Tableau for* [*data visualization*](https://www.financealliance.io/storytelling-with-data-visualization-playbook/) *to support financial analysis and decision-making. Additionally, I'm proficient in Excel and have used it for everything from budgeting to financial modeling."* **Q. Can you tell us about a time when you faced a significant operational challenge and how you overcame it?** Example response: > *"In a previous role, we were faced with a major customer's late payments, which was affecting our cash flow. I worked closely with the sales and customer service teams to understand the situation from the client's perspective.* > *"We decided to implement a more flexible payment plan for the client, which helped them to catch up on payments without disrupting our relationship. Concurrently, I introduced stricter credit policies and terms for new customers to prevent similar issues in the future."* Other examples of operational questions: - Can you provide an example of a process you've improved in your current or previous role? - How do you ensure financial reports are accurate and timely? - Can you share your approach to cost control and how you've successfully managed operational costs in the past? - How would you handle a situation where you identified significant inefficiencies in our operational processes? - How have you used financial analysis to drive operational improvements? 💡 Reminder: When answering these questions, interviewers are looking to assess your hands-on skills and experience in financial operations management, your problem-solving abilities, and your understanding of how operational efficiency impacts the broader financial health of the company. ### **4\. Financial questions** Here, your deep knowledge of finance is tested. These questions aim to understand your proficiency in financial analysis, budgeting, [forecasting](https://www.financealliance.io/5-ways-to-instantly-improve-cash-flow-forecasting-techniques/), and managing financial risks. These questions can often be quite technical. For instance: **Q. How do you approach creating a financial forecast for a company like ours?** Example response: > *"I would first conduct a comprehensive analysis of your historical financial data, identifying patterns and trends...* > *"I would then collaborate with other departments to understand your sales forecasts, marketing plans, and operational costs. I also consider macroeconomic trends and industry factors. The result is a forecast that is not only based on numbers, but also on a holistic view of the business."* **Q. Can you describe a time when you identified and mitigated a significant financial risk?** Example response: > *"In my previous role, our company was considering a major investment in new technology. My analysis showed it could significantly drain our cash reserves and put us at risk if it didn't yield expected returns. I presented my findings to the executive team and proposed an alternative plan: a phased approach to the investment, which would allow us to test the technology's impact before fully committing. This approach was accepted and ended up saving the company from a potentially significant financial risk."* **Q. What types of finance tools do you use on the job and/or have experience with?** Example response: > *"Over the course of my career, I've become proficient in a range of finance tools. I've extensively used enterprise-level ERP systems such as SAP and Oracle for managing finances at a macro level...* > *For financial analysis and reporting, tools like Tableau and Power BI have been invaluable. I've also used specific financial modeling tools like Adaptive Insights. Of course, Excel remains a staple for various financial tasks."* **Q. What steps would you take to improve our company's financial performance?** Example response: > *"Improving financial performance is a multi-faceted process. Firstly, I would conduct a thorough review of your financial statements to understand the current performance and identify any areas of concern. Secondly, I would work closely with department heads to identify cost-saving opportunities and efficiency improvements...* > *"Additionally, I would review your investment strategy to ensure it's aligned with the company's risk tolerance and growth objectives. Lastly, I would ensure that we have robust financial controls and reporting in place to inform decision-making. Throughout this process, I would prioritize communication with stakeholders to ensure everyone understands the financial goals and their role in achieving them."* Other financial questions that could come up during your interview include: - How would you approach creating a budget for a company of our size and industry? - Can you discuss your experience with managing debt and capital structure? - How have you leveraged financial data and analytics to drive business improvement? - How would you handle a situation where there is a significant deviation from the [financial forecast](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/)? - Can you describe your approach to cash flow management, particularly during a downturn or a period of uncertainty? 💡 Reminder: A great CFO can see beyond the spreadsheet. They can grasp the threads of the company's past and present, and weave them into a roadmap for the future. They don't just report on financial health, they nurture it, they cultivate it, and they chart a course for it. ### **5\. Situational/behavioral questions** These questions throw you into hypothetical situations or delve into your past experiences to understand how you'd behave in different scenarios. The aim is to evaluate your problem-solving, leadership, and interpersonal skills. Examples might be: **Q. Tell me about a time when you had to make a difficult financial decision. How did you handle it?** Example response: > *"In my last role, a significant customer was consistently late with their payments, impacting our cash flow. After careful analysis, I had to make the difficult decision to suspend their credit terms until the arrears were cleared. I communicated this decisively yet diplomatically, maintaining the relationship while ensuring our financial health."* **Q. Imagine our company is facing a significant budget cut. How would you decide what gets reduced?** Example response: > *"In such a scenario, I'd conduct a thorough cost-benefit analysis of all departments and projects. Non-critical initiatives would be first for review. I would also seek to enhance operational efficiency and renegotiate contracts, aiming to make strategic cuts that minimize impact on our core services and employees."* **Q. What steps will you take to help other senior executives make good financial decisions?** Example response: > *"Open communication is key. I would ensure they have clear, accurate, and timely financial information. I'd also offer my strategic insight, translating financial data into actionable intelligence. My aim would be to foster a financially-aware culture where every decision is made with a clear understanding of its financial impact."* **Q. If revenue projections suggest the possibility of the business incurring a loss, what measures would you implement to safeguard the business from this potential loss?** Example response: > *"I would swiftly put in place a contingency plan focusing on cash preservation, including reviewing all expenses, deferring non-critical expenditures, accelerating incoming payments, and exploring additional funding options if needed. Throughout, I would ensure transparent communication with all stakeholders about the situation and our response strategy."* [Crisis Management Plan vs Business Continuity PlanBelieve it or not, a crisis management plan is not the same as a business continuity plan. The two are similar in many ways, sure, but they have key differences that set them apart.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-83.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Stock--4-.png)](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) ### **6\. Personal/leadership questions** These questions help interviewers understand who you are as a person and a leader. They might ask about your leadership style, your motivations, and your cultural fit with the company. For example: **Q. How would you describe your leadership style and how has it contributed to your success?** Example response: > *"I would describe my leadership style as 'collaborative'. I believe in harnessing the collective intelligence of my team to make informed decisions. I encourage open communication, invite different perspectives, and value everyone's input...* > *"This approach not only fosters a motivated and cohesive team, but it also leads to more robust and well-rounded financial strategies. I've found that my ability to build and lead high-performing teams has been integral to my success as a CFO."* **Q. What motivates you as a CFO?** Example response: > *"What motivates me most as a CFO is the opportunity to drive strategic growth. I enjoy using financial data to uncover insights that can shape the direction of the company. There's something deeply satisfying about translating numbers into strategies, and then watching those strategies lead to tangible business outcomes...* > *"I'm also driven by the chance to mentor and develop my team, and to create a finance function that not only serves the company but empowers it."* **Q. If someone in your direct-report finance team falls short of your expectations, how would you handle the situation?** Example response: > *"I believe in addressing such issues promptly and constructively. First, I would have a private conversation with the individual to understand the root cause of the issue. It's possible they need further training, clearer instructions, or more feedback...* > *"Then, we'd work on a performance improvement plan together, setting clear, measurable objectives. I would follow up regularly to provide support and track their progress. My goal would be to empower them to improve while also ensuring the efficiency and effectiveness of the team as a whole."* **Q. Can you describe how you promoted ethical conduct within your team in your last position?** Example response: > *"Ethics have always been paramount to me, both personally and professionally. In my most recent role, I set clear expectations of ethical behavior and incorporated these principles into our team's goals and performance metrics. I led by example, ensuring my actions consistently mirrored the standards I set...* > *"To foster an open environment, I encouraged team members to voice concerns without fear of repercussions. We also conducted regular training sessions on ethical issues to keep everyone updated. Through these actions, I believe we built a culture where ethics were considered in every decision we made."* Other examples of leadership questions: - How do you develop talent within your team? Can you share a specific example? - How do you approach delegating tasks within your team? - How do you ensure effective [communication](https://www.financealliance.io/stakeholder-communication-plan/) within your team and with other departments? - What strategies do you use to manage your team's performance and keep everyone on track? 💡 Remember, each question is an opportunity to demonstrate your competence, your character, and your commitment. Understanding the structure and aims of these questions can equip you to respond with confidence and clarity, painting a comprehensive picture of you as the ideal CFO. ## **Presentation of financial analysis and strategic vision** In some CFO interviews, you may be asked to present a financial analysis or discuss your strategic vision for the organization. This is an opportunity to showcase your analytical skills, financial acumen, and ability to think strategically. To prepare for this aspect of the interview, follow these steps: ![CFO interview questions](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/data-src-image-4sbqk83iu7o.png) ## **Performance tips for your interview** From the moment you step into the interview room, every word you say, every gesture you make, and even the way you sit can send powerful messages about your suitability for the role. So, how do you ensure you're ticking all the right boxes and leaving a lasting impression? Here are some performance tips to help you ace your CFO interview: ### **1\. Speak their language** Alright, first things first, you want to be clear, concise, and on point. Don't beat around the bush or get lost in financial jargon. Answer the question, use real-life stories to illustrate your points, and always tie it back to how you can add value to their company. ### **2\. Radiate confidence** Confidence isn't just about knowing your stuff (though that's important), it's also about showing it. Stand tall, give a firm handshake, and maintain eye contact. Show them you're a financial whiz who can handle pressure with grace and charm. ### **3\. Be an industry guru** You're not just a number cruncher; you're a strategic leader. That means knowing the financial landscape inside and out. Be ready to chat about industry trends, regulatory changes, and how you've navigated these in the past. Show them you're not just keeping up with the industry, but you're staying a step ahead. ### **4\. Body language speaks volumes** You know as well as anyone that it's not just what you say, it's how you say it. Non-verbal cues can make or break an interview. Keep your posture open, use natural hand gestures when explaining your points, and keep your expressions friendly and attentive. ### **5\. The art of listening** It's easy to get so caught up in what you're going to say next that you forget to really listen. But remember, good conversation is a two-way street. Show them you value their input and can communicate effectively. ### **6\. Get your ducks in a row** Preparation is key. Know the company, rehearse your answers and get a good night's sleep. Walk into that room knowing you've done your homework and you're ready to impress. ### **7\. Be creative** And finally, be *creative*. According to a [Harvard Business Review interview](https://hbr.org/1990/01/the-value-adding-cfo-an-interview-with-disneys-gary-wilson) with Disney’s ex-CFO, Gary Wilson, a CFO creates value by being creative. When asked '*how can a CFO create value?*', he answered: > *"Just like all the great marketing and operating executives — by being creative. Creativity creates value. In finance that means structuring deals creatively."* [Top 20 FP&A skills (10 hard skills & 10 soft skills)Here are the top 20 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/FA_Website_Article_Images_Doodles--2-.png)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) ## **The importance of reciprocal questions** Asking your own questions in an interview is an excellent way to show your genuine interest in the role and the company, and it's a valuable opportunity to determine whether the company is a good fit for you as well. By asking thoughtful and informed questions, you demonstrate that you've done your homework and that you're looking at the opportunity from all angles, not just as a job, but as a partnership between you and the organization. Here are some examples of insightful questions you might want to ask during your interview: **Understanding the company's vision:** > *"Can you describe the company's growth plans for the next five years, and how the CFO will contribute to achieving those goals?"* **Learning about the team:** > *"Could you tell me more about the team I would be leading? What are their strengths, and where are the areas for improvement?"* **Gauging corporate culture:** > *"How would you describe the company culture here, particularly within the finance department?"* **Assessing the challenge:** > *"What are some of the most significant financial challenges the company is currently facing, and how can the CFO play a role in overcoming these?"* **Understanding expectations:** > *"What would you consider success for the CFO in the first six months on the job?"* **Future opportunities:** > *"What opportunities for professional development or advancement might be available to the CFO in the future?"* **Aligning with leadership:** > *"How does the executive leadership team work together to set strategy and make decisions?"* By asking questions, not only do you showcase your seriousness and dedication to the role, but you also gather crucial information that can help you determine whether this role and company are indeed a good fit for your career aspirations. ## **After the interview** You've completed the interview and can finally breathe a sigh of relief… but now what? The post-interview phase is equally crucial in securing the job, as it involves effective follow-ups, critically evaluating the job offers you receive, and, of course, navigating the negotiation process for your [compensation package](https://www.financealliance.io/fp-a-salary-and-career-path-guide/). [Does job-hopping increase your salary in finance?The question isn’t whether job-hopping increases salary, as it clearly does. The more important question is how and when to move in order to maximise long-term value.![](https://static.ghost.org/v5.0.0/images/link-icon.svg)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/01/FA_Website_Article_Images_Doodles--6-.png)](https://www.financealliance.io/does-job-hopping-increase-your-salary-in-finance/) ### **Effective follow-ups** A well-timed, thoughtful follow-up message can leave a lasting impression. A thank you note expressing your continued interest in the role and appreciation for the interviewer's time is a great start. This is an opportunity to reiterate your key strengths, touch upon an engaging aspect of the interview, or clarify a point, if necessary. ### **Evaluating job offers** When you receive a job offer, it's not just about the salary. Evaluate the entire compensation package, including bonuses, stock options, retirement contributions, and other benefits. Consider the company culture, opportunities for professional growth, and the alignment of the company's vision with your career goals. ### **Handling the negotiation process** As a potential CFO, you bring immense value to the company, and your compensation should reflect this. Before entering negotiations, research the market rate for CFOs in your industry and region, identify your priorities (base salary, bonuses, stock options, benefits), and be prepared to discuss your achievements and value proposition. Approach negotiations with professionalism and assertiveness, express your expectations and show a willingness to reach a mutually beneficial agreement. According to research, [75% of recruiters](https://www.linkedin.com/pulse/top-100-hiring-statistics-2022-rinku-thakkar/) have noticed an increase in salary negotiations from their candidates. So, don't be afraid to negotiate and if you're met with a counteroffer, consider it thoroughly before responding. 💡 Remember, compensation negotiation is an ongoing process, as your increasing contributions over time can pave the way for future adjustments. --- ## FAQs: CFO interview questions How do I prepare for a CFO round interview? Preparation should involve understanding the company's financial landscape, industry trends, and potential challenges. This includes analyzing the company's financial reports, understanding its strategic plans, and familiarizing yourself with its market and competitors. Additionally, brush up on your leadership examples and successes, as well as potential answers to common CFO interview questions. How can I express my understanding of the company's industry during the interview? Refer to industry trends and challenges when discussing your strategic plans. Show that you understand the company's market position, competitors, and industry regulations. This will demonstrate that you're not just financially savvy, but also business-oriented. How can I handle situational or behavioral questions in a CFO interview? Structure your responses using the STAR (Situation, Task, Action, Result) method. This involves describing a situation you faced, the task you needed to accomplish, the action you took, and the result of your action. What are some red flags I should look out for in a CFO interview? Red flags could include lack of clarity about the company's financial situation, unrealistic expectations for the CFO role, a high CFO turnover rate, or a company culture that doesn't align with your values. How can I deal with interview nerves? Preparation is key to overcoming nerves. Practice your responses, research the company thoroughly, and get a good night's sleep before the interview. On the day, take deep breaths, maintain eye contact, and remember that it's not just about them assessing you, but also about you assessing if the company is a good fit for you. --- ### **Join our Slack community** It's an empowering platform for finance professionals like you, offering an exclusive space to connect, learn, and grow. We bring together diverse minds from the finance world, facilitating knowledge sharing and fostering innovation. From topical discussions and expert insights to collaborative projects, you'll find value in every interaction. [Join us](https://www.financealliance.io/community/) to stay updated with the latest in finance, network with peers, and contribute to shaping the future of our industry. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_.png) ](https://www.financealliance.io/community/) ### Your waste is hiding in plain site. How to save 8-15% on healthcare spend. URL: https://www.financealliance.io/take-control-of-healthcare-spend/ Last updated: 2026-06-10T20:38:26.000Z Healthcare is one of your largest operating expenses. But for most employers with 1,000+ employees, it's also one of the least controlled. Inefficiency and waste underpin rising costs month after month — and most organizations have no way to see it, let alone stop it. You're relying on annual audits, TPA reports, and retrospective analysis — reviewing spend after the money is already gone. That's not a control. It's a post-mortem. **There's a better way.** In this session, learn how leading finance teams are shifting from retrospective audit to continuous financial oversight — identifying 8–15% in savings before it ever hits the P&L. --- ### **What you'll learn** - Why traditional sample-based audits miss the majority of cost drivers - How identical healthcare services can vary 3x–20x in price within the same network - Why your broker and TPA aren't accountable for what your plan actually pays, and what that means for you - What a continuous, monthly audit and control function looks like in practice - The steps finance leaders are taking right now to reduce costs before they're incurred --- ### **The challenges we'll tackle** **You're auditing after the fact, not controlling spend in real time** Annual audits and broker reports tell you what happened. They don't stop overpayments before they occur. We'll show you what proactive financial control of healthcare actually looks like. **Pricing variance you don't know exists** The same procedure at different in-network providers can vary in price by 3x to 20x. Without visibility into this, you're consistently overpaying, and you don't know it. **Your TPA and broker data isn't neutral** Brokers, TPAs, and carriers each have a function in your plan. None of them carry fiduciary responsibility for what you ultimately pay. The healthcare ecosystem is built on information asymmetry that compounds against you over time, and the accountability sits with you. **Healthcare isn't managed like other major cost lines** Every other significant expense gets monthly oversight and financial controls. Healthcare rarely does. It's time to change that. --- ### Meet the speakers [**David Magnan**](https://www.linkedin.com/in/david-magnan-81b9356b/)*, Technology Executive & Business Leader* David Magnan is a results-driven technology executive with over 50 years of leadership experience. He has led organizations through growth, transformation, and operational excellence across sales, marketing, customer service, software R&D, and large-scale operations, including turnarounds and strategic acquisitions. **Justin Magnan,** *President & Co-Founder, Andovia* Justin has spent nearly two decades helping self-insured employers turn healthcare data into financial leverage. He works directly with CFOs and benefits leaders, translating raw claims data into the cost and risk intelligence needed to make better decisions, before renewal, not after. ### Scaling the unscalable: Operationalizing productivity in a $1B+ construction vertical URL: https://www.financealliance.io/operationalizing-productivity-in-a-1b-construction-vertical/ Last updated: 2026-04-07T09:03:06.000Z In the world of hyper-scale infrastructure, we often talk about the "billion-dollar build": the massive Capital Expenditure (CapEx) required to put steel in the ground and servers in racks. But as any seasoned [finance leader](https://www.financealliance.io/financial-leadership-in-changing-times-2/) knows, the build is only half the battle. The next test of financial leadership lies in the Operating Expenditure (OpEx): the complex, human-centric, and often volatile cost of running a 5,000-person construction vertical. When you are managing an annual OpEx [budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) exceeding $1B, traditional "incremental" budgeting isn't just inefficient, it’s a strategic risk. In a global landscape where supply chains are strained and labor markets are tight, Finance must evolve from a "guardian of the purse" to an architect of operational efficiency. Here is how we transitioned from reactive spending to a proactive, productivity-driven model at scale. [CapEx vs Opex | Key differences, examples & why it mattersMaster the difference between CapEx and OpEx to optimize budgeting and drive growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-485.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/capex-vs-opex-6.png)](https://www.financealliance.io/capex-vs-opex/) ## **The fragmented reality of hyper-growth** In a hyper-growth environment, OpEx often balloons because headcount is viewed as the only lever for increasing output. When project volume doubles, the instinctive reaction from [leadership](https://www.financealliance.io/top-10-cfo-skills/) is often to double the workforce. However, in the infrastructure space, the challenge is distinct: how do you support a global build-out while ensuring that the internal "machine" (the thousands of people in the construction vertical) is operating at peak efficiency? To manage a $1B+ budget effectively, Finance must stop looking at OpEx as a "cost of doing business" and start looking at it as a lever for productivity. This requires a fundamental shift in how we define value, moving away from tracking hours worked and toward measuring the velocity of [capital deployment](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/). ## **1\. Standardization: The anti-chaos agent** The first step in scaling OpEx is moving away from bespoke, team-by-team budgeting. We implemented a [standardized](https://www.financealliance.io/17-finance-business-processes/) financial lifecycle framework that treated our global operations as a single, integrated portfolio. By categorizing a 5,000-person vertical into specific functional clusters (from site development to electrical engineering) we were able to create "cost profiles" based on output rather than tenure. Instead of asking the legacy question, *"How many people do you need for next year?"* we began asking, *"What is the capacity-per-head required for this specific construction phase?"* This allowed us to normalize costs across different geographic regions, identifying outliers where OpEx was disconnected from the actual rate of construction. [Why “operational debt” costs your finance function $100k+ per leaderThe businesses that scale successfully aren’t led by CFOs who take pride in doing everything themselves.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-486.png)Finance AllianceFilip Pesek![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--17--4.png)](https://www.financealliance.io/why-operational-debt-costs-your-finance-100k-per-leader/) ## **2\. Algorithmic headcount planning** Standardization paved the way for algorithmic headcount planning. In this model, OpEx growth is tethered directly to the CapEx roadmap rather than subjective requests from hiring managers. We developed a "Resource-to-Build" ratio that dictates when a new hire is justified based on the volume of active megawatts or square footage in the construction pipeline. This algorithmic approach removes the emotion and negotiation from the [budgeting](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/) process. If a project is delayed or removed from the roadmap, the headcount approval is automatically throttled. Conversely, when a region sees a spike in activity, the resources are pre-authorized based on proven capacity metrics. This ensures that the organization stays lean during ebbs and scales rapidly during flows, maintaining a balanced ratio between fixed and variable costs. ## **3\. Operationalizing the productivity mandate** In many large organizations, leadership sets a 10% year-over-year (YoY) productivity goal. Achieving this at the billion-dollar level requires more than just high-level directives; it requires a deep dive into process economics. We had to move the needle from "budget utilization" to "output velocity." In big tech finance, productivity isn't just about doing more with less; it’s about ensuring every dollar of OpEx is directly contributing to the acceleration of the organization’s primary assets. [How finance is evolving from reporting to innovationIs your finance team seen as a roadblock? Discover how to evolve finance from a cost center to a strategic driver of innovation and growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-487.png)Finance AllianceSiqi Chen![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--10.png)](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) ## **4\. Bridging the CapEx-OpEx divide** The most dangerous silo in infrastructure finance is the wall between the CapEx and the OpEx plans. If construction OpEx isn't perfectly synchronized with the infrastructure buildout schedule, the result is "stranded talent"; highly paid technical [teams](https://www.financealliance.io/how-to-optimize-finance-teams/) waiting for site access or project approvals. By integrating OpEx planning directly into Project Lifecycle Management (PLM) tools, we ensured that the moment a project shifted on the timeline, the OpEx [forecast](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) adjusted automatically. This synchronization prevents the "budget shock" that occurs when massive projects are delayed, but headcount costs remain fixed. It transforms Finance into a predictive partner that can warn leadership of the operational "drag" caused by project volatility. ## **5\. Real-time variance and the feedback loop** To maintain a 10% productivity trajectory, the feedback loop must be instantaneous. We moved away from quarterly reviews toward real-time variance tracking. By comparing actual labor output with our algorithmic "cost profiles," we can identify inefficiencies in specific regions before they affect the total portfolio. This granular visibility allows us to reallocate OpEx resources dynamically. If one region is under-utilizing its staff due to local permitting delays, those [resources](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) can be redirected to a high-velocity project elsewhere. This agility ensures that labor is always deployed where the construction ROI is highest, maximizing the yield on our largest operational investment: our people. [6 strategies for FP&A to master scenario planning and risk managementHow FP&A can help the organization prepare for potential outcomes, mitigate risk, and remain resilient and forward-focused.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-488.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-5-6.png)](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) ## **The cultural shift: Finance as a product** Ultimately, the transition to a productivity-driven model requires a cultural shift within the Finance organization itself. At this scale, the Finance team’s "product" is **Clarity.** We provide the transparency necessary for leadership to make high-stakes decisions with confidence. By managing a $1B+ OpEx budget through the lens of productivity, we transformed a massive, often opaque construction vertical into a leaner, more predictable, and highly scalable organization. For finance leaders in any industry, the lesson is the same: Don’t just track the spend. Measure the velocity of the spend and the specific outputs it delivers. When you treat your OpEx budget as a dynamic engine rather than a static bucket, you don't just save money; you create a resilient competitive advantage that scales alongside your infrastructure. --- ### **About the author** **Alexander S.** is an Infrastructure Finance Leader at a leading hyperscaler, specializing in large-scale infrastructure planning and capitalization frameworks. With a background in corporate development and financial lifecycle engineering, he currently oversees more than $1B in annual OpEx planning for global construction operations. He is an expert in operationalizing productivity mandates and bridging the gap between technical infrastructure requirements and strategic financial outcomes to optimize portfolio-level ROIC. ### Why Austin has become a hub for finance and tech URL: https://www.financealliance.io/why-austin-has-become-a-hub-for-finance-and-tech/ Last updated: 2026-03-27T10:59:38.000Z ## **Austin is moving fast (and finance feels it first)** If you spend time with [finance leaders](https://www.financealliance.io/securing-the-cfo-seat-of-tomorrow-the-moves-that-define-future-ready-finance-leaders-today/) in Austin right now, a consistent theme comes up quickly: the pace of decision-making has shifted. It’s not just that the city is growing, but that multiple layers of [growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) are happening at the same time, and they are feeding into each other: population, talent, corporate presence, and capital. The numbers help ground that reality. The Austin metro tech workforce is approaching 95,000 roles after [adding roughly 30,000 jobs](https://wfscapitalarea.com/reports-insights/labor-market/tech-industry-snapshot-sept-2025/) over the past five years. Layer in the [steady stream of corporate moves](https://techbehemoths.com/blog/why-are-tech-companies-moving-to-texas). Since 2020, companies like Tesla, Oracle, and Hewlett Packard Enterprise have either relocated or expanded their headquarters presence in Austin. Austin is dubbed “Silicon Hills” **because* it attracts tech professionals and startups (in fact, the startup culture in Austin [brings in over $10 billion in annual revenue](https://www.razoroo.com/post/top-tech-companies-in-austin) and employs over 130,000 people). ## **Headquarters moves are rewriting the finance playbook** An HQ relocation changes more than the org chart. It reshapes how a company operates, how it hires, how it invests, and how it measures success. In Austin, many companies arrive during a transition phase. Some are moving from growth to scale. Others are expanding into new markets or rethinking their operating model entirely. [Finance teams](https://www.financealliance.io/fp-a-team-structure/) step into that environment with a mandate to bring structure to a moving target. The regional economy reflects the scale of what is happening, since Austin’s tech sector [contributed $150 billion to the regional GDP](https://worldmetrics.org/austin-texas-tech-industry-statistics/). For [FP&A leaders](https://www.financealliance.io/fp-a-salary-and-career-path-guide/), that level of activity translates into real pressure. Workforce plans, infrastructure investment, and go-to-market expansion all need to be modeled in parallel. Each of those decisions ties directly to [capital allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) and long-term margin. ## **Growth-stage tech is where FP&A complexity shows up** Austin has become a strong base for growth-stage companies, and that stage is where finance tends to carry the most weight. You see it in hiring. You see it in product investment. You see it in how companies think about burn versus growth. In climate tech alone, Austin now supports more than [1,400 companies with over 28,000 open roles](https://www.mindmeldpr.com/post/tech-hub-spotlight-austin). That kind of hiring demand creates a direct link between talent strategy and financial performance. Tech workers in Austin command a premium compared to non-tech roles, which raises the cost profile of scaling teams. For [FP&A](https://www.financealliance.io/top-10-fp-a-skills-to-master/), this turns workforce planning into one of the most important levers in the business. Every hiring plan carries implications for productivity, cost structure, and future margin. Finance leaders need to model those trade-offs continuously, often with inputs that change week to week. This is where traditional planning cycles start to feel slow. Annual budgets still matter, and they sit alongside rolling [forecasts](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/), [scenario planning](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/), and more frequent updates that reflect how quickly the business is evolving. [![CTA Image](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/META---FP-A-Summit-1.png)](https://events.financealliance.io/location/austin) See how top FP&A teams are redesigning decision-making in fast-moving environments. Learn practical approaches to faster planning, smarter forecasting, and better capital allocation. [Register now ](https://events.financealliance.io/location/austin) ## **Enterprise structure meets startup speed** One of the more interesting dynamics in Austin is how enterprise companies and startups coexist in the same ecosystem. Large enterprises bring structure, governance, and [long-term planning](https://www.financealliance.io/how-to-use-a-driver-based-forecast-to-drive-strategic-initiatives/) frameworks. Startups bring speed, experimentation, and a willingness to make decisions with incomplete information. In Austin, finance teams often operate across both environments. That creates a hybrid expectation. FP&A needs to maintain rigor and control while supporting faster decision-making. It also means translating between different ways of operating, helping leadership teams align around a shared [financial narrative](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/). The density of the ecosystem reinforces this. Talent moves between companies. Ideas carry across industries. Expectations around speed and performance tend to converge. Finance teams sit at the center of that convergence, helping connect strategy, operations, and capital allocation in a way that keeps the business moving forward. ## **Faster cycles, higher expectations** As Austin grows, the time available to make decisions continues to shrink. Hiring plans move quickly because the talent market is competitive. [Investment](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/) decisions accelerate because companies are scaling in parallel. Forecasts need to stay current because assumptions evolve in real time. For finance leaders, that means operating with both speed and clarity. A hiring decision influences cost base and productivity, a product investment shapes revenue trajectory, and a market expansion changes the capital profile of the business. FP&A becomes the function that brings these pieces together, providing a clear view of trade-offs and helping leadership teams move forward with confidence. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-482.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-21.png)](https://www.financealliance.io/financial-charts-and-graphs/) ## **Capital allocation is getting more nuanced** Austin continues to attract investment, and the conversation around capital has become more focused. Growth opportunities are everywhere (product, talent, geographic expansion) and each one competes for resources. Finance leaders are expected to guide those decisions with a clear understanding of return profiles and strategic priorities. That requires more than a single forecast: it needs [multiple scenarios](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/), each grounded in realistic assumptions about the business. The broader funding environment reinforces this. Capital remains available, and expectations around efficiency and outcomes continue to rise. Finance teams play a central role in aligning investment decisions with long-term value creation. In practice, that often means building a narrative around where the company is placing its bets and how those bets translate into measurable outcomes. ## **Modernization is happening quickly, and for good reason** Austin’s pace tends to surface the limits of manual finance processes fairly quickly. As companies scale, the volume of data increases and the number of moving parts grows with it. Many finance teams in Austin are investing in integrated planning tools, [automation](https://www.financealliance.io/secure-by-design-fp-a-automating-planning-without-expanding-the-fraud-surface/), and real-time data visibility. These changes support faster decision-making and help maintain alignment across the organization. The broader business environment supports this shift. Technology companies bring expectations around system maturity. Talent entering finance roles expects more modern tools. Leadership teams want finance to operate at the same speed as the rest of the business. Modernization becomes part of how finance delivers value. It enables teams to spend less time managing data and more time analyzing it, which is where FP&A can have the greatest impact. [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-483.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--20.png)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) ## **From spreadsheets to strategy** Perhaps the most noticeable shift in Austin is how finance teams are stepping further into a strategic role. FP&A leaders are involved earlier in decision-making. They help frame investment choices, evaluate risks, and connect financial outcomes to operational drivers. The role extends beyond reporting into shaping how the business moves forward. This shift brings a different set of expectations, [communication](https://www.financealliance.io/stakeholder-communication-plan/) becomes more important, and business context matters more. The ability to translate financial insights into actionable recommendations becomes a core skill. Austin’s environment accelerates this transition. The combination of growth, competition, and capital intensity places finance in a position where its influence can shape outcomes in a meaningful way. ## **Why this matters for finance leaders** Austin offers a clear example of how the finance function evolves in a high-growth environment. The city brings together several forces (talent expansion, corporate migration, and technological innovation) that are reshaping how businesses operate. For finance leaders, the takeaway is practical: - Faster growth requires faster planning cycles. - More complexity requires stronger alignment across teams. - Greater access to capital brings higher expectations around how that capital is used. Austin highlights what modern FP&A looks like when all of those factors come together. [The £7.5 million lesson: What real FP&A influence looks likeHow do you close the FP&A influence gap? You clarify, challenge, and connect so that finance moves from being reactive to being influential.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-484.png)Finance AllianceAlexander Roche![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--19-.png)](https://www.financealliance.io/what-real-fp-a-influence-looks-like/) ## **FP&A Summit – Austin** If Austin shows anything clearly, it is how quickly finance can move from being a support function to the engine behind decision-making. The pace of the city forces that shift. Hiring moves quickly, capital gets deployed quickly, and leadership teams expect clarity just as quickly. That is exactly the context [**our Austin summit is built for**](https://events.financealliance.io/location/austin). The event is centered on a simple but very real pressure point: when markets move fast, slow decisions carry a cost. And in a place like Austin, that cost shows up quickly, whether it is in missed hiring windows, delayed product bets, or capital tied up in the wrong priorities. **What makes** [**our event**](https://events.financealliance.io/location/austin) **so important for finance leaders is that it focuses on how leading FP&A teams are actually responding to that pressure.** This is less about theory and more about how teams are redesigning the way decisions get made inside their organizations: - How planning cycles are being shortened without losing rigor. - How forecasting is becoming more dynamic, with AI playing a more practical role. - How finance teams are building models that leadership can rely on when the stakes are high. There is something valuable about [****having these conversations in Austin**](https://events.financealliance.io/location/austin) specifically. The challenges being discussed are not hypothetical. They're playing out across the companies in the room, which creates a different kind of dialogue: more grounded, more practical, and more immediately useful. This is your opportunity to step back from the day-to-day pressure and see how others are solving similar problems. ****Namely, finance leaders from top companies like Google, Uber, Indeed, Walmart, and SciPlay.** Not in a theoretical way, but in a way that reflects the realities of scaling teams, allocating capital, and keeping pace with a business that does not slow down. [Connect and learn from top finance leaders ](https://events.financealliance.io/location/austin) ### Why most finance professionals feel underpaid (and what to do about it) URL: https://www.financealliance.io/why-most-finance-professionals-feel-underpaid/ Last updated: 2026-03-26T16:24:28.000Z Despite working in one of the most commercially critical functions in any organisation, a large proportion of finance professionals feel they’re not being compensated fairly. It’s a surprising contradiction. Finance teams are responsible for managing performance, guiding strategic decisions, and safeguarding the financial health of businesses. Yet many of the people doing that work feel undervalued. [**Recent data from the Finance Alliance Salary Report**](https://www.financealliance.io/finance-salary-report/) highlights just how widespread this issue is: 40% of respondents said they are not very happy with their salary, and nearly half reported that their pay does not reflect the value they bring to their organisation. So why does this gap exist? And more importantly, what can finance professionals do about it? ## **The disconnect between responsibility and reward** One of the clearest themes in the data is the growing gap between what finance professionals are expected to do and how they are compensated. Many respondents reported taking on additional responsibilities without seeing meaningful increases in pay. In some cases, professionals are effectively operating at a higher level than their [job title](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) suggests, but without the salary to match. This is not uncommon in finance. As businesses evolve, finance teams are often asked to step beyond traditional [reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) roles and take on more strategic responsibilities, such as: - Supporting business planning and [forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) - Partnering with non-finance teams - Providing insights to senior leadership - Contributing to decision-making processes However, compensation structures don’t always keep pace with these changes. Pay bands, internal [budgets](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), and rigid promotion cycles can delay or limit salary increases, even when responsibilities expand significantly. The result is a growing sense of imbalance: more is expected, but not always rewarded. [Does job-hopping increase your salary in finance?The question isn’t whether job-hopping increases salary, as it clearly does. The more important question is how and when to move in order to maximise long-term value.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-480.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--6--9.png)](https://www.financealliance.io/does-job-hopping-increase-your-salary-in-finance/) ## **Why salary progression often lags behind performance** Another key factor behind salary dissatisfaction is how pay progression is structured within organisations. The survey shows that pay increases are often inconsistent: - Some professionals receive modest raises when promoted - Others take on more work without formal recognition - A portion of respondents report unclear or inconsistent criteria for [salary increases](https://www.financealliance.io/does-job-hopping-increase-your-salary-in-finance/) Even in companies with defined processes, increases may be tied to annual review cycles, budget constraints, or company performance, rather than individual contribution alone. This creates a situation where: - High performers don’t always see immediate financial rewards - Salary growth becomes slow and incremental - Market value and internal pay diverge over time In contrast, the external job market often moves faster, which is why many professionals experience larger salary jumps when changing roles rather than staying put. ## **The role of perception: value vs compensation** Salary dissatisfaction isn’t just about the numbers, it’s also about perception. When finance professionals were asked whether their salary reflects the value they bring to the business, responses were almost evenly split. This highlights a deeper issue: many professionals feel that their contribution is not fully recognised. Finance roles today are increasingly tied to business outcomes. Teams are expected to: - Drive profitability - Improve efficiency - Enable strategic growth - Support leadership decisions When compensation doesn’t align with this level of impact, it can lead to frustration, disengagement, and ultimately, higher turnover. ## **What actually increases earning potential in finance** If the problem is clear, the next question is: what actually moves the needle on salary? The same report provides a strong indication. The biggest increases in earning potential are linked to a few key factors: ### **1\. Skill mastery** The difference between developing and mastering skills is significant. [Professionals who report mastering relevant skills](https://www.financealliance.io/finance-certifications-can-boost-your-earning-power/) earn, on average, nearly **$147,549**, compared to just **$40,081** for those still developing. This suggests that salary growth is not just about experience, but about capability. ### **2\. Broader experience** Exposure to different companies and environments also plays a major role. [Professionals who have worked across multiple organisations](https://www.financealliance.io/does-job-hopping-increase-your-salary-in-finance/) earn significantly more than those who have stayed in one place for their entire career. This kind of experience builds adaptability, commercial awareness, and stronger negotiating power. ### **3\. Leadership responsibility** Managing people is another key driver of higher compensation. The data shows a clear [relationship between team size and salary](https://www.financealliance.io/fp-a-salary-and-career-path-guide/), with those in leadership roles earning more than individual contributors. As finance professionals move into management positions, their value to the organisation increases, and so does their earning potential. [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/FA_Finance_Salary_Report_Survey_Email-1.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ## **What finance professionals can do to close the gap** Understanding the problem is one thing. Taking action is another. For those who feel underpaid, there are several practical steps that can help realign compensation with value: ### **1\. Build in-demand, demonstrable skills** Focus on developing skills that directly impact business performance, such as: - Forecasting and [financial modeling](https://www.financealliance.io/10-best-financial-modeling-tools/) - Business partnering and communication - Data analysis and storytelling The more measurable your impact, the stronger your position when negotiating salary. And the data is clear: salary [growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) is increasingly tied to *capability*, not just experience. Professionals who can demonstrate business impact are the ones most likely to command higher pay, especially as organisations prioritise performance over tenure. ### **2\. Make your value visible** Many finance professionals deliver significant value, but don’t always communicate it effectively. Link your work to outcomes: - Revenue growth - Cost savings - Strategic decisions influenced This helps shift conversations from “what you do” to “what you deliver.” ### **3\. Negotiate, because most people don’t (and it pays)** A surprising number of professionals still don’t negotiate their pay, even when they should. [More than 50% of candidates don’t negotiate their salary](https://blog.theinterviewguys.com/we-reviewed-every-salary-negotiation-study/), despite it being one of the biggest drivers of long-term earnings. Yet the upside is significant: - People who negotiate earn on average \~18.8% more than those who don’t - Around 66% of those who negotiate successfully increase their offer Even small changes compound over time. Negotiation experts suggest even a simple ask can lead to 5–20% increases in compensation. The takeaway: negotiation isn’t aggressive, it’s expected and effective. ### **4\. Don’t rely on tenure alone** Time in a role does not guarantee higher pay. Without increased responsibility, new skills, or expanded scope, salaries can plateau. Progression needs to be intentional, not passive. [How finance certifications can boost your earning power in 2026Organizations increasingly expect finance teams to be proactive partners in shaping strategy, not just reactive record-keepers.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-481.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--4--4.png)](https://www.financealliance.io/finance-certifications-can-boost-your-earning-power/) ### **5\. Be strategic about career moves** If internal progression is limited, it may be worth exploring external opportunities. Changing roles can: - Reset your salary to market rate - Increase responsibility more quickly - Expand your experience and skill set There’s strong evidence behind this: [job switchers consistently see higher pay increases](https://www.financealliance.io/does-job-hopping-increase-your-salary-in-finance/) than those who stay, as external moves allow salaries to catch up with market demand. ### **6\. Look beyond salary (total compensation matters more than you think)** If base salary is fixed, there are still ways to increase overall compensation. Negotiate for: - Bonuses or equity - Flexible working - Learning and development budgets - Additional leave In fact, negotiation experts emphasise that compensation isn’t just about salary; it’s also about securing a package that reflects your full value, including benefits and long-term incentives. ### **7\. Don’t ignore external factors (the market matters too)** Sometimes, feeling underpaid it’s about the broader environment. For example, [other reports also show finance salaries have declined](https://www.spendesk.com/blog/cfo-salary-benchmark/) in some markets, while job dissatisfaction is rising and nearly half of professionals are considering leaving their roles. At the same time, wider workforce data shows extreme dissatisfaction, with [up to 89% of workers](https://hrreview.co.uk/hr-news/reward-news/overwhelming-89-of-uk-workers-unhappy-with-their-pay-amid-economic-pressures/380871) saying their pay doesn’t meet their needs. This context matters. It explains why even strong performers can feel underpaid; the market itself is shifting. ## **The bigger picture: a profession in transition** The underlying reason many finance professionals feel underpaid is that the role of finance itself is changing. As automation handles more routine tasks, the value of finance is shifting toward: - Insight and interpretation - Strategic thinking - Communication and influence However, compensation structures have not fully caught up with this shift. This creates a temporary disconnect, where expectations rise faster than pay. ## **Final thoughts: feeling underpaid is a signal, not a dead end** If you feel underpaid in your current role, you’re not alone. The data shows that this is a widespread experience across the profession. But it’s also a signal. It often indicates that: - Your responsibilities have outgrown your role - Your skills are more valuable than your current salary reflects - Or your environment is limiting your earning potential The key is recognising that gap and taking deliberate steps to close it. --- Your voice matters. Help us reveal the real story of finance in 2026 by [****sharing your experience anonymously**](https://www.financealliance.io/finance-alliance-salary-survey/). Join your finance peers who already filled out our survey and don’t miss your chance to compare and contribute. [Make your voice heard: take our 2026 survey ](https://www.financealliance.io/finance-alliance-salary-survey/) ### Trying to decide when to use sensitivity analysis vs scenario analysis? URL: https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/ Last updated: 2026-03-24T15:09:05.000Z Both techniques are valuable for analyzing the potential effects of uncertainty in financial models. But when does sensitivity analysis make sense, and when is scenario analysis the better choice? Find out in this article, where we explore the main differences between the two, and when you should use one over the other. ## **What is sensitivity analysis?** Sensitivity analysis is a [financial modeling](https://www.financealliance.io/10-best-financial-modeling-tools/) technique that measures how changes in one input variable affect your model's outcome while holding all other variables constant. You might test how a 10% increase in interest rates impacts your NPV, or how different sales volumes affect profitability. This **one variable at a time** approach helps you identify which variables have the most influence on your results. It's particularly valuable for risk assessment, model validation, and communicating key drivers to stakeholders. Think of it like a financial magnifying glass that lets you examine each factor's individual impact. [Communication plan with stakeholders: a five-step guideMaster stakeholder communication in five clear steps. You can use this guide to craft clear, consistent communication that keeps everyone aligned and engaged.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-471.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/5-step-stakeholder-communication-plan.png)](https://www.financealliance.io/stakeholder-communication-plan/) ## **Benefits of sensitivity analysis** Some benefits of sensitivity analysis include: ### **1\. Enhanced business communication** Sensitivity analysis breaks complex model outputs into understandable [insights](https://www.financealliance.io/mastering-data-storytelling/). This means you can clearly show key stakeholders how your strategic plans can affect the *broader* business and budget. ### **2\. Verifies model integrity** A [financial model](https://www.financealliance.io/build-a-saas-financial-model/) should mirror your business's reality. Sensitivity analysis helps cross-check this reflection. You can use it to confirm if the key drivers you based your model on genuinely have the most impact on business outcomes. This gives your models extra reassurance that they're as accurate and effective as possible. ### **3\. Identifying risks and improving scenario analysis** By revealing how a small adjustment in one variable can impact the outcome, you get a head start on managing those risks. Not only that, but sensitivity analysis helps you focus your [scenario analysis](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) on what matters. This targeted approach saves you from creating models around different scenarios that might not be relevant to your decision-making process. ## **How sensitivity analysis works** [Sensitivity analysis](https://corporatefinanceinstitute.com/resources/financial-modeling/what-is-sensitivity-analysis/) follows a systematic process: identify your key variables, establish a base case, then test each variable across a reasonable range while keeping others constant. Most analysts use data tables in Excel or specialized software to automate these calculations. Here's how you'd run sensitivity analysis in your financial model: 1. **Choose your base case:** Start with your most likely scenario using realistic assumptions 2. **Select key input variables:** Focus on the factors that could significantly impact your outcome 3. **Test a range of values:** Vary each input by ±10%, ±20%, or whatever range makes sense for your analysis 4. **Review the output:** Create sensitivity tables showing how your results change with each input Tornado [charts](https://www.financealliance.io/financial-charts-and-graphs/) often help visualize which variables have the greatest impact, making it easier to prioritize your focus areas. [How to transform financial data into compelling storiesFP&A professionals have to understand the business deeply. We’re not just reporting results or explaining variances. We are taking on part of the decision-making burden.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-472.png)Finance AllianceLewis Danby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--5--10.png)](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) ### **Example: Interest rate sensitivity in portfolio management** Consider a $10 million bond portfolio with a five-year duration. Your base case assumes current rates at 4%. Testing sensitivity to rate changes: - Rates at 3% (-1%): Portfolio value increases to $10.5 million (+5%) - Rates at 5% (+1%): Portfolio value decreases to $9.5 million (-5%) This 1:5 sensitivity ratio tells you that for every 1% change in rates, your portfolio value moves 5% in the opposite direction. Armed with this insight, you can better hedge your interest rate risk. ### **Example: Sales volume impact on profitability** A manufacturing company forecasts 100,000 units sold at $50 each, with variable costs of $30 per unit and fixed costs of $1 million. Testing sales volume sensitivity: - 80,000 units (-20%): Profit drops from $1 million to $600,000 (-40%) - 120,000 units (+20%): Profit increases to $1.4 million (+40%) This 2:1 sensitivity shows that profit changes twice as fast as sales volume. This high operating leverage means that [learning how to improve sales forecast accuracy](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) is critical for this business. ## **What is scenario analysis?** [Scenario analysis](https://www.financealliance.io/scenario-planning-strategic-forecasting-for-finance-teams/) assesses multiple inputs simultaneously to model different realistic situations. With this approach, you can stress test for plausible scenarios as well as unlikely, but high-impact cases. Developing a range of possible scenarios facilitates [contingency planning for your business](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/). [Scenario analysis](https://corporatefinanceinstitute.com/resources/financial-modeling/scenario-analysis/) is particularly useful for strategic planning, risk management, and capital budgeting. It helps visualize different paths a business could take under varying circumstances, helping it to prepare for multiple possible outcomes. [How to create a budget allocation plan for a companyBudget allocation is the process of dividing your company’s financial resources between departments. As you can imagine, it can be a tricky process to get right. Everyone wants a bigger piece of the pie, and you can’t always please everyone.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-473.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--7--2.png)](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) ## **Benefits of scenario analysis** ### **1\. Improves strategic thinking** Scenario analysis creates a multifaceted perspective and allows decision-makers to anticipate both promising opportunities and potential pitfalls linked to certain policies and strategies. ### **2\. Promotes effective resource allocation** Scenario analysis is rooted in forecasting future events and trends. This forward-thinking approach helps business leaders understand external conditions that could impact their operations. Armed with these insights, they can distribute resources more strategically, mitigating risks and harnessing opportunities more effectively. ### **3\. Strengthens risk management** By presenting multiple possible futures, scenario analysis allows for better [risk assessment and management](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/). It provides a safety net for businesses, helping them be better prepared for unforeseen circumstances and volatile market conditions. [FP&A career path and salary guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-474.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--10--1.png)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) ## **How scenario analysis works** Scenario analysis is a technique that assesses the combined impact of changes in all input variables simultaneously. To do this, an analyst conceives various potential events that could realistically occur down the line. It typically involves crafting three distinctive [narratives](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/): **1\. Base-case scenario:** This scenario represents business-as-usual or the expected situation. **2\. Worst-case scenario:** The most challenging outcome that could transpire if things don't go according to plan. **3\. Best-case scenario:** The best possible and most desired projected outcome. Now, let’s dive into some examples of how finance teams might employ scenario analysis: ### **Example 1: Revenue forecasting** Picture yourself as a CFO trying to figure out [how to create a revenue plan](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) for the next fiscal year. A lot depends on your forecast: budget allocations, strategic decisions, [investment planning](https://www.financealliance.io/10-big-picture-financial-planning-steps/). To make an informed forecast, you need to consider several variables: unit price, unit cost, and sales volume, among others. In a scenario analysis approach, you'd create different scenarios, altering multiple variables at once. For example: **1\. The base-case scenario:** You might use the current unit price, [cost](https://www.financealliance.io/5-cost-reduction-strategies/), and expected sales volume based on the company's performance and market trends. **2\. The best-case scenario:** You would use the highest feasible unit price (without significantly impacting sales volume), the lowest realistic unit cost (perhaps through supplier negotiations or process efficiencies), and a sales volume that takes into account potential market growth or successful marketing campaigns. **3\. The worst-case scenario:** You could consider a situation with a lower unit price (due to increased competition), a higher unit cost (due to rising raw material prices), and a reduced sales volume (perhaps because of an economic downturn or increased competition). This analysis can give you a range of possible revenues for the next fiscal year, which can guide your strategic planning and decision-making. [How to predict revenue in FP&A using machine learningBy analyzing historical sales data, marketing efforts, economic indicators, and even customer sentiment, machine-learning models can identify patterns and trends that are difficult for humans to see.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-475.png)Finance AllianceGabriela Gutierrez![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--8--2.png)](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/) ### **Example 2: Investment** For this example, let's assume you're the head of a finance team, and your company is considering a significant investment like opening a new factory. This decision depends on a host of variables: projected sales, operational costs, and market growth, to name a few. In scenario analysis, you'd simultaneously alter these variables across different scenarios: **1\. The base-case scenario:** You might base this on conservative estimates of market trends and projected sales, alongside the current operational cost structure. **2\. The best-case scenario:** This could assume strong market growth leading to higher than average sales, along with successful cost optimization efforts reducing operational costs. **3\. The worst-case scenario:** This could consider a challenging market scenario leading to lower sales, coupled with increased operational costs due to unexpected price hikes in raw materials or labor costs. This scenario analysis allows you to view the possible outcomes for the investment holistically, providing a risk-reward assessment that could steer the final investment decision. [Why supply chains determine post-merger successMergers aren’t tested in boardrooms, but in factories, planning systems, supplier networks and distribution centers, long after the deal announcement.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-476.png)Finance AllianceMasha Chandrasekaran![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--26-.png)](https://www.financealliance.io/why-supply-chains-determine-post-merger-success/) ## **What is the difference between scenario analysis and sensitivity analysis?** While both techniques help you understand risk and uncertainty in your financial models, they work differently and serve distinct purposes. **Sensitivity analysis** changes one variable at a time while keeping everything else constant. It's like testing individual ingredients in a recipe; you adjust the salt, then the pepper, then the cooking time, each separately. This helps you identify which factors have the biggest impact on your results. **Scenario analysis** changes multiple variables simultaneously to create realistic business situations. Instead of tweaking one ingredient, you're creating entirely different recipes; maybe a "recession scenario" where revenue drops, costs rise, and interest rates increase all at once. When comparing scenario analysis vs sensitivity analysis, think of sensitivity as a microscope and scenarios as a wide-angle lens. Both are valuable, but they give you different perspectives on the same underlying risks. Some analysts also use **simulation analysis** (like Monte Carlo methods), which runs thousands of scenarios with random variable combinations based on probability distributions. This provides a statistical view of potential outcomes but requires more sophisticated modeling. While scenario analysis vs sensitivity analysis covers most practical needs, simulation analysis can be useful when you need probability-based insights for complex decisions. [Month-end close checklist: Steps, process & best practicesWhether you’re a seasoned finance pro or just starting, we’re here to guide you through the process. We’ve got some handy checklists, nifty tips, and a few tricks up our sleeve to transform your month-end close from a frantic scramble into a streamlined process.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-477.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--19-.png)](https://www.financealliance.io/month-end-close-checklist/) ## **When to use sensitivity analysis vs scenario analysis** Choosing between these methods depends on your specific analytical needs and the complexity of the relationships you're examining. Here's when each approach works best: ### **When to use sensitivity analysis:** - **Impact assessment:** Test how individual variables affect outcomes, like examining how [discount rates impact NPV in a DCF](https://www.financealliance.io/cost-benefit-analysis/) model. Essential for understanding which assumptions matter most. - **Model validation:** Verify your model's logic by checking if outputs respond appropriately to input changes. If revenue doesn't increase with higher prices, you've found a formula error. - **Risk prioritization:** Identify which variables need the most attention in your analysis. A 1% change in gross margin might matter more than a 10% change in marketing spend. - **Data precision planning:** Determine where you need better estimates. If your model is highly sensitive to customer churn rates, invest time in refining that assumption. - **Communication:** Sensitivity tables and tornado charts clearly show stakeholders which factors drive results. Perfect for board presentations and investment committees. [How CFOs are using AI to transform financial presentationsAI tools can now enable CFOs to build board-ready decks in as little as four hours instead of 40+.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-478.png)Finance AllianceSalvatore Tirabassi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--7--2.png)](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/) ### **When to use scenario analysis:** - **Strategic planning:** Evaluate major decisions under different future states. Test whether an acquisition makes sense in both growing and declining markets. - **Stress testing:** Examine worst-case scenarios where multiple things go wrong simultaneously. What if rates rise, sales drop, and costs increase all at once? - **Market condition modeling:** Assess performance under different economic environments. Model recession, recovery, and boom scenarios with appropriate variable combinations. - **Investment evaluation:** Test project viability across different scenarios. A real estate development might face different combinations of construction costs, rental rates, and financing terms. - **Risk management:** Prepare contingency plans for various futures. If competitor entry coincides with regulatory changes, what's your response? ## **Blending both methods for comprehensive analysis** [The most robust financial models](https://www.financealliance.io/10-best-financial-modeling-tools/) use both techniques. Start with sensitivity analysis to identify critical variables, then build scenarios around different combinations of those key drivers. This two-step approach ensures you focus scenario planning on what actually matters. For example, if sensitivity analysis reveals that occupancy rates and rental prices most impact your real estate model, create scenarios combining different levels of both. Your bear case might assume 75% occupancy with declining rents, while your bull case models 95% occupancy with rental growth. Whether you're building DCF models, [preparing budgets, or evaluating investments](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), these twin analytical techniques will provide you with invaluable insights to make confident, data-driven decisions. --- ## **FAQs: Scenario analysis vs sensitivity analysis** What advantage does scenario analysis have over sensitivity analysis? Scenario analysis allows evaluating the combined effect of multiple factors changing simultaneously. Sensitivity analysis only looks at one variable at a time. What are the two types of sensitivity analysis? One-at-a-time sensitivity analysis varies one input while holding others constant. Probabilistic sensitivity analysis assigns probability distributions to inputs and evaluates using Monte Carlo simulation. What is the use of sensitivity and scenario analysis? They help validate models, identify key variables, stress test strategies, and prepare contingency plans by understanding potential outcomes. Can I use both techniques together? Yes! Using both sensitivity and scenario analysis provides comprehensive model validation. Sensitivity analysis identifies key value drivers, while scenario analysis tests performance under various conditions. ### Securing the CFO seat of tomorrow: The moves that define future-ready finance leaders today URL: https://www.financealliance.io/securing-the-cfo-seat-of-tomorrow-the-moves-that-define-future-ready-finance-leaders-today/ Last updated: 2026-03-20T15:08:13.000Z ## **Why I believe finance leaders need to rethink the role now** Before I get into the bigger ideas, it helps to understand the context I come from, because it has shaped the way I think about finance [leadership](https://www.financealliance.io/financial-leadership-in-changing-times-2/). I’m the CFO at Hitachi Vantara, a storage company and a subsidiary of Hitachi Limited, a company with more than a hundred years of history behind it. We are a meaningful global business, with around 8,000 employees and a few billion dollars in revenue. My organization spans both finance and IT, with about 450 employees in each group spread across the world. We have teams in Malaysia, Japan, India, Mexico, Poland, and the United States. So when I talk about the future of finance, I’m not talking about it from the vantage point of a small, centralized team. I’m thinking about it in the context of scale, complexity, geography, and real operational friction. And yet, despite all of that complexity, I don’t think the core challenge is unique to a company of our size. The issues [finance leaders](https://www.financealliance.io/global-finance-leaders-report-how-to-make-a-bigger-impact-as-a-finance-leader/) are wrestling with right now are showing up everywhere. They cut across company size, geography, and operating model. The questions are the same: What does AI really mean for finance? What happens to the work our teams do today? And what does the [CFO role](https://www.financealliance.io/your-first-90-days-as-cfo/) become if a meaningful share of traditional finance work is automated? My view is simple: the future-ready CFO is not the one who defends the old shape of the job. It is the one who helps redesign it. [5 cost reduction strategies for CFOs that protect growthAs a CFO, you’re at the helm, steering your company toward financial stability. But how do you cut costs without cutting corners?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-463.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--18--1.png)](https://www.financealliance.io/5-cost-reduction-strategies/) ## **What I learned early in my career about comfort and complacency** I started my career at Ernst & Young about 28 years ago. Like a lot of first years, I got sent to do year-end inventory counts. And I drew what felt like the lucky straw at the time: driving to Fresno on New Year’s Eve to count pipe fittings at an industrial pipe company. It was exactly what it sounds like. A giant field with huge pipes laid out everywhere, and my job was to count them and make sure the numbers tied to the inventory register. When I got there, the [controller](https://www.financealliance.io/cfo-vs-controller/), who had been at the company for 15 years, handed me the inventory register. I opened it up and it was a sheet of ledger paper with handwritten numbers and descriptions of inventory. He had written it out by hand so I could do my work. There was no [ERP system](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/). He was doing the accounting manually. I asked if there was a photocopier so I could make notes, and he told me, “That’s yours.” So I wrote on it, and then he wrote himself a second handwritten copy so he could track what I was doing. That moment stuck with me. Not because it was quaint, but because it showed me how easily people can get comfortable inside a process and stop challenging whether the process still makes sense. In his mind, that was the job. You wake up, it’s [month-end](https://www.financealliance.io/month-end-close-checklist/), you do the same set of tasks, and when you finish item ten on the checklist, you go home and relax. There was no real pressure in his mind to think, “Is there a better way to do this?” He had built his routine and settled into it. That pattern exists everywhere in finance if we let it. When I moved into industry, I saw the same thing. There were people who were hesitant to embrace new technology, people who felt they had no time to learn it, and people who simply did not yet understand what it could do for them. I went in the other direction. I spent a huge amount of time learning Excel, figuring out how I could do work faster and better than anyone else around me. Then I taught myself Visual Basic. Then I got annoyed by Excel’s row limits and moved into Access and SQL so I could do more with larger sets of data. What I started doing was taking the work no one else wanted. I would go to my bosses and say, “Give me the three crappiest things on your plate.” Those were usually the tasks they were happiest to hand off. I would take them over, automate them, simplify them, and learn from them. That became a way for me to differentiate myself, to build new [skills](https://www.financealliance.io/top-10-fp-a-skills-to-master/), and to expand my career. I never worried too much about what I was leaving behind by not doing the exact same work as the person before me. That mindset matters even more now than it did then. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-464.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-20.png)](https://www.financealliance.io/financial-charts-and-graphs/) ## **Technology does not replace good finance people. It elevates them.** One of the biggest [mistakes](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) I think finance teams make is treating each wave of technology as a threat instead of an opportunity. I didn’t see Excel that way when I was coming up. I didn’t see databases that way either. And I don’t think we should see AI that way now. Technology is not going to replace great finance talent. It is going to make great finance talent better. It allows you to remove the work that consumes time but doesn’t truly require judgment. That, in turn, creates room for the work you should have been doing in the first place or the work you never had time to get to. That is the real promise. It is not about doing the same job with fewer people. It is about doing more valuable work with the talent you already have. That is how I think about AI today. In some ways, I see the same opportunity I saw when I was first starting my [career](https://www.financealliance.io/fp-a-salary-and-career-path-guide/). I didn’t spend much time along the way learning data science or Python. A lot of that passed me by. But when I look at AI, I recognize the moment. I recognize the inflection point. And I’m pushing myself and my teams to treat it as a chance to move into the fast lane, not a reason to stay in the comfort lane defending an old version of the job. The real question is not whether AI changes finance. It obviously will. The real question is whether we change ourselves fast enough to use it well. [How I’m thinking about AI after 27 years in financeAfter 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-465.png)Finance AllianceGeeta Malhotra![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--3.png)](https://www.financealliance.io/ai-in-finance-business-strategy/) _This post is for paying subscribers only._ ### Why supply chains determine post-merger success URL: https://www.financealliance.io/why-supply-chains-determine-post-merger-success/ Last updated: 2026-03-19T13:32:49.000Z When companies announce [acquisitions](https://www.financealliance.io/risks-of-mergers-and-acquisitions/), the narrative almost always centers on strategy: portfolio expansion, category adjacency, geographic reach, digital capability. The deal logic typically looks convincing on paper. Yet decades of research suggest a different reality. Various studies estimate that between 70% and 90% of mergers fail to achieve their intended objectives. Much of the explanation usually focuses on culture clashes or strategic misalignment. But these explanations often overlook more operational truth. In practice, many mergers succeed or fail in the [supply chain](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/). It is here that two organizations must actually learn to operate as one. Factories must produce new product portfolios. Supplier networks must be aligned. Distribution systems must support different demand patterns. Planning systems must reconcile competing assumptions about service levels, [inventory](https://www.financealliance.io/how-to-forecast-inventories/), and working capital. And it is usually at this point that organizations discover the real complexity of integration. [Are you prepared to navigate the intricacies of an M&A?David Yates, CFO at Gresham, takes you on a journey through the intricacies of an M&A so you can unlock the best returns for your organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-457.png)Finance AllianceDavid Yates![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--48--4.png)](https://www.financealliance.io/are-you-prepared-to-navigate-the-intricacies-of-an-m-a/) ## **The gap between deal models and operational reality** In most acquisition models, supply chain synergies appear straightforward: procurement leverage, manufacturing consolidation, logistics optimization. These levers often represent a substantial share of the expected value from a deal. But those projections typically assume that two supply chain architectures can be merged with minimal friction. In reality, supply chains are deeply embedded operating systems. They evolve over decades around supplier relationships, manufacturing footprints, [regulatory](https://www.financealliance.io/finance-and-compliance/) constraints and commercial commitments. Integrating them is far more complex than simply combining assets. Research reinforces this point. A [McKinsey analysis of M&A performance](https://www.mckinsey.com/capabilities/m-and-a/our-insights/using-m-and-a-to-transform-procurement) found that companies capturing the most value from acquisitions invest heavily in operational integration early in the process, particularly across [procurement](https://www.financealliance.io/100-day-procurement-plan-for-finance-leaders/) and supply chain networks. Organizations that delay these efforts frequently struggle to realize the projected benefits of scale. Academic research has reached similar conclusions. Studies examining supplier network compatibility in mergers show that structural alignment between supplier ecosystems strongly influences post-merger performance. When two organizations rely on fundamentally different sourcing structures, integration becomes far more difficult. In other words, the operational architecture of the supply chain often determines whether the economic case for the deal holds. Yet supply chain considerations are still frequently underrepresented in early deal discussions. ## **Capability transfer is often the real prize** Another shift shaping modern M&A is that acquisitions are increasingly about capabilities rather than scale. A widely discussed example was [Walmart’s acquisition of Jet.com in 2016](https://corporate.walmart.com/news/2016/09/19/walmart-completes-acquisition-of-jet-com-inc) for approximately $3.3 billion. The move signaled the retailer’s intent to accelerate its capabilities in e-commerce and compete more effectively in digital retail. But the strategic significance of the deal extended beyond simply adding another online store. Jet.com had built its business around a [technology-driven](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) commerce platform designed to optimize pricing, logistics and fulfillment through sophisticated algorithms. The company also developed a strong brand among younger, urban online shoppers and had cultivated a culture rooted in rapid experimentation and digital product development. For a traditional brick-and-mortar retailer like Walmart, the acquisition offered an opportunity to learn from a digital-native operating model – particularly around e-commerce platform development, data-driven merchandising and online customer acquisition. In this sense, the deal was not only about expanding Walmart’s online presence, but also about acquiring digital capabilities, talent and a technology-driven operating model that could help modernize the company’s broader [retail strategy](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/). This reflects a broader trend. Increasingly, companies are acquiring organizations that operate with very different models. But transferring those capabilities into a global enterprise environment can be extremely difficult. Digital-native businesses are optimized for speed and experimentation. Large multinational supply chains prioritize scale, reliability and [cost efficiency](https://www.financealliance.io/5-cost-reduction-strategies/). Reconciling these approaches requires far more than a standard integration checklist. It often requires organizations to rethink [governance](https://www.financealliance.io/finance-and-compliance/), operating models and decision rights. [Why most mergers fail: Lessons from weather patterns and M&A due diligenceUnlike weather forecasting, where being wrong just means carrying an umbrella, being wrong about an acquisition can destroy both companies.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-458.png)Finance AllianceBill Guerrero![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images-Text-1.png)](https://www.financealliance.io/why-most-mergers-fail/) ## **Integration challenges often emerge slowly** Operational integration rarely happens overnight. Manufacturing transfers take time to execute safely. Supplier transitions require qualification, regulatory approvals and contract renegotiation. Distribution networks must be redesigned carefully to avoid service disruptions. Technology integration can be equally complex. According to research from Boston Consulting Group, companies that successfully capture deal synergies tend to establish integrated digital platforms early in the integration process. Fragmented IT environments, by contrast, create operational blind spots that undermine decision making. For supply chains, data consistency is essential. Demand [forecasts](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), production plans, cost models and inventory policies all rely on shared systems and common assumptions. When organizations operate across disconnected planning and costing systems, they lose visibility into the true economics of the integrated business. Recognizing this, many companies are investing heavily in digital supply chain capabilities. These tools are particularly valuable during integrations, where thousands of operational interdependencies must be evaluated simultaneously. ## **Network design determines integration success** Among the most consequential integration decisions are those related to network design. These choices determine: - which factories produce which products - how distribution networks are structured - where inventory buffers sit across the system - how transportation lanes are optimized These decisions shape cost structures for years. Yet they are rarely simple optimization exercises. Manufacturing capacity constraints, regulatory approvals, supplier contracts and commercial commitments often influence the final design. Global consumer goods companies face additional complexity because product formulations and packaging formats may vary significantly across regions. As a result, network integration is often a multi-year process rather than a one-time decision. [Secure-by-design FP&A: How finance automation can speed planning and shrink riskSecure-by-design FP&A is not a constraint on ambition, but what makes ambitious automation sustainable.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-459.png)Finance AllianceAmal Mammadov![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--21--5.png)](https://www.financealliance.io/secure-by-design-fp-a-automating-planning-without-expanding-the-fraud-surface/) ## **Governance is where many integrations falter** Operational complexity alone does not explain integration challenges. Organizational dynamics are equally important. Supply chains intersect with almost every major function in the enterprise; procurement, manufacturing, logistics, [finance](https://www.financealliance.io/) and commercial operations. During integration, these functions may pursue competing objectives. Procurement may prioritize supplier consolidation. Manufacturing may emphasize asset utilization. Commercial teams may resist product rationalization to protect revenue. These tensions are inevitable. But without strong governance structures, they can slow integration and dilute the economic impact of operational decisions. This is where finance leaders increasingly play a central role. According to research published in Harvard Business Review, companies that involve finance deeply in operational integration decisions tend to achieve stronger synergy realization. Finance provides the economic framework that aligns decisions across functions and ensures that operational changes translate into tangible value. In many successful integrations, finance effectively becomes the architect of the new operating model. [How to create a revenue plan that doesn’t fall apart by Q3This blog will walk you through the main components of a revenue plan, what good revenue planning involves, when to start and how to put together a plan that gets results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-460.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--19.png)](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) ## **Integration timelines are often underestimated** Another persistent misconception in M&A is the assumption that integration is largely complete within the first 12 to 18 months after closing. For supply chains, this timeline is rarely realistic. Manufacturing transitions may require equipment modifications, regulatory approvals and supplier qualification. Demand [planning](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) models must be recalibrated to reflect new product portfolios. Logistics networks may need to be redesigned to support new service expectations. Research from PwC’s global M&A practice suggests that many operational synergies take several years to fully materialize, particularly in asset-intensive industries such as consumer goods and manufacturing. Organizations that treat PMI as a short-term exercise often declare success too early, only to find that the anticipated benefits remain partially unrealized. ## **The evolving role of supply chain leadership in M&A** Historically, supply chain leaders were often brought into acquisition processes after deals had already been signed. Their role was to execute integration plans designed elsewhere. That approach is becoming increasingly outdated. Leading acquirers now involve supply chain leadership much earlier, often during due diligence itself. This allows organizations to evaluate critical questions before committing capital: - Can the target’s supply chain scale internationally? - Are supplier ecosystems compatible? - What operational investments will integration require? - How will working capital dynamics change? These questions may appear operational, but they directly influence deal economics. When supply chain considerations are incorporated early in the acquisition process, synergy forecasts become significantly more reliable. [10 risks of mergers and acquisitions & how to mitigate themIn this article, we explore the top 10 risks of acquiring a company and how to mitigate them.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-461.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--1--1.png)](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) ## **Why supply chains have become the decisive factor** Supply chains have always been important in post-merger integration, but their strategic importance has increased dramatically. Global sourcing networks are more complex. Consumer expectations around availability and speed have intensified. Digital technologies have transformed how companies plan production, manage inventory, and fulfill orders. Integrating two companies now involves integrating two highly interconnected operational ecosystems. Success requires strategic clarity, operational discipline and increasingly sophisticated digital capabilities. Companies that recognize this treat supply chains as strategic infrastructure rather than back-office operations. Because ultimately, mergers are not tested in boardrooms. They are tested in factories, planning systems, supplier networks and distribution centers, long after the deal announcement. And in that operational reality, the supply chain determines whether the economics of a merger actually work. ### 7 data management problems and solutions for CFOs URL: https://www.financealliance.io/7-data-management-problems-and-solutions/ Last updated: 2026-03-19T12:27:49.000Z Data management plays a pivotal role in driving insightful decisions and ensuring the financial success of a company. But let's face it; navigating this intricate landscape can feel like a battle, filled with data management [challenges](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/) like inaccuracies, security breaches, and complex integrations. But what if we told you that for every data management problem, there’s a viable solution to help resolve it? Keep reading to learn about the most common data management problems and solutions. ## **What is data management?** Data management is the practice of collecting, organizing, protecting, and storing your organization's data so it can be used reliably for reporting, [analysis](https://www.financealliance.io/cost-benefit-analysis/), and decision-making. For finance teams, strong data management supports accurate close processes, better forecasting, cleaner board reporting, and more confident strategic planning. In practice, data management is what turns disconnected financial information into usable business intelligence. Without it, teams end up working from [inconsistent reports, manual spreadsheets, and outdated numbers](https://www.financealliance.io/how-finance-automation-is-changing-role-fpa/). That slows decisions, increases risk, and makes compliance harder. [Mastering data storytelling: Turning numbers into actionWant to learn how to transform your data into powerful narratives that shape the future of your business?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-446.png)Finance AllianceSharon Mahoney![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images-Text--2-.png)](https://www.financealliance.io/mastering-data-storytelling/) ### **Types of data management for finance teams** Modern data management includes several connected disciplines: - **Data pipelines and ETL** move data from systems like ERP, CRM, billing, and banking platforms into a central reporting environment - **Data governance** defines data [ownership](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/), access rules, standards, and accountability - **Data architecture** maps how data is structured and how systems connect across the business - **Data warehouses** create a centralized source of truth for analysis and reporting - **Data security and compliance** protect sensitive financial and operational data ### **Why data management matters for CFOs** For [CFOs and finance professionals, poor data management](https://www.financealliance.io/why-cfos-need-financial-data-management/) creates more than operational friction. It affects reporting credibility, audit readiness, cash visibility, planning speed, and stakeholder trust. When data is fragmented or unreliable, finance teams spend more time validating numbers and less time advising the business. The rest of this article looks at the most common data management challenges finance teams face, along with practical ways to solve them. [Top 15 must-have Chief Financial Officer skillsThe modern CFO wears many hats and must master a variety of CFO skills. But what skills does the CFO of the future need to stay on top of their game? Keep reading as we uncover some of the most important Chief Financial Officer skills…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-448.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--2--5.png)](https://www.financealliance.io/top-10-cfo-skills/) ## **Data management problems and solutions** ## **1\. Problem: Data inaccuracy and quality** Inaccurate and poor-quality data can be the bane of any CFO's existence. It often leads to misguided financial decisions, which is bad news for obvious reasons, but the one your boss will care about most is how it’ll negatively impact the bottom line. Using inaccurate data can also severely damage your company's reputation. If you can’t provide reliable and accurate financial information, [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) will lose confidence in not only you and your capabilities, but in the company as a whole. The root causes of this data management problem are multifaceted, ranging from human error and system glitches to the sheer volume of data being handled. ### **Solution: Implement data validation processes** Thankfully, there are practical solutions to tackle these database performance issues head-on. Implementing data validation processes at the point of entry can help minimize errors and [ensure data is clean and accurate](https://www.financealliance.io/data-cleaning-techniques/). Automated error checks can also help boost data quality by flagging inconsistencies, making it easier to keep on top of them. Another solution is to roll out regular audits to help identify and rectify discrepancies *before* they snowball into larger problems. Putting robust processes and systems in place will create a strong foundation for upholding the highest data quality standards. Prioritizing relevant data and streamlining data collection methods can help reduce the chances of errors creeping in. By focusing on what matters most, you can better [allocate resources](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) and ensure the accuracy of your organization's financial data. ![Data management challenges - bonus tip](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/data-management-problems-and-solutions-1.png) ## **2\. Problem: Tackling data overload and volume** The sheer volume of data companies accumulate can be overwhelming. If you’re in a finance role, it’s likely you could run into some common challenges when managing vast amounts of data, such as: - Difficulty in identifying relevant information for decision-making. - Time-consuming manual data processing. - Increased risk of errors due to data complexity. These data management challenges can make it difficult to extract valuable insights and make timely financial decisions. ### **Solution: Strategies for managing data overload and volume** To effectively tackle data overload and volume, consider implementing the following strategies: **1\. Prioritize relevant data** Focus on the most critical data elements directly impacting your financial decisions. This helps to reduce the noise and ensures you're working with the most relevant information. **2\. Utilize automated data processing** Leverage [automation](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) tools to streamline data processing tasks, reducing manual effort, and minimizing the risk of errors. This will free up your team to focus on more strategic tasks. **3\. Employ visualization tools** Utilize [data visualization](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) software to transform complex data into easily digestible formats, such as graphs and charts. Doing this will help you to quickly identify trends, patterns, and anomalies. [17 top finance business processesEffective and streamlined finance business processes keep companies running smoothly. They’re vital for sound financial management, which is essential for a company’s success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-449.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--15--3.png)](https://www.financealliance.io/17-finance-business-processes/) ## **3\. Problem: Data silos and fragmented systems** Data silos remain one of the biggest barriers to effective finance operations. They create several downstream issues: - Incomplete or inconsistent [reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) - Delays during close and planning cycles - Conflicting numbers across teams - Limited visibility into performance drivers The challenge isn't just "systems that don't talk to each other" anymore. Many organizations now deal with a mix of cloud apps, legacy platforms, spreadsheets, and custom tools. That introduces API limits, inconsistent data definitions, authentication issues, and synchronization delays between systems. ### **Solution: Build connected data pipelines** Breaking down silos requires more than one-off integrations. It requires a repeatable data integration strategy. **1\. Use ETL or ELT processes to automate data movement** ETL and ELT help extract data from source systems, standardize it, and load it into a reporting environment like a data warehouse. This reduces manual reporting work and improves consistency. **2\. Create a single source of truth** Finance teams need one trusted destination for reporting and analysis. A centralized data warehouse can bring together ERP integration, CRM, billing, payroll, and payment data so everyone works from the same numbers. **3\. Choose tools that simplify API integration** Integration platforms like Rivery, Fivetran, or Stitch can reduce the burden of managing connectors, API changes, and data refresh logic in your data pipelines. **4\. Standardize data definitions and ownership** Even good pipelines fail if different teams define revenue, customer, or margin differently. Document core metrics, assign ownership, and create data standards that support reporting consistency. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-451.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-19.png)](https://www.financealliance.io/financial-charts-and-graphs/) ## **4\. Problem: Data security and compliance** As financial data often include sensitive information, it’s important to make sure the data is protected from unauthorized access, breaches, and misuse. Focusing on database problems and solutions is crucial because a lack of proper security measures and compliance can lead to a line-up of potential issues, including: - Financial losses due to fraud, theft, or data breaches. - Reputational damage resulting from negative publicity and customer mistrust. - Regulatory fines and penalties for non-compliance with data protection laws and industry standards. These issues can severely undermine an organization's financial stability and hinder its ability to grow and compete in the market. ### **Solution: Strengthening data security and ensuring compliance** Here are some ways to address [data security](https://www.financealliance.io/what-is-big-data-security-analytics/) and compliance concerns: **1\. Implement robust security measures** Invest in advanced security solutions, such as encryption, multi-factor authentication, and intrusion detection systems, to protect sensitive financial data from unauthorized access and cyber threats. **2\. Establish clear data policies and procedures** Develop data governance policies that outline the appropriate handling, storage, and sharing of financial data within the company. Don’t forget to make sure the whole team is trained on these policies and adhere to them. **3\. Regularly monitor and audit data practices** Conduct regular data security audits and assessments to identify potential vulnerabilities and ensure compliance with industry standards and regulations. **4\. Collaborate with IT and cybersecurity teams** Work closely with IT and cybersecurity experts to stay informed about emerging threats and best practices for protecting financial data. Foster a culture of shared responsibility for data security across the entire organization. We loved this quote from Adam Moloney, ex-CFO at Blancco Technology Group as he emphasizes the importance of collaborating with the IT team to help [avoid poor data management](https://www.cfo.com/technology/2022/11/costs-of-poor-data-management-it-department-data-security/). > “Work hand in hand with the IT team to ensure the finance voice is heard in identifying priorities throughout the company’s policy reviews and updates to data security protocols.” ## **5\. Problem: Data accessibility and governance** Ensuring relevant financial data is easily accessible to authorized personnel, while also maintaining control over its usage, is so important. Failing to do so can lead to: - Slow and bulky decision-making processes caused by difficulties in accessing relevant data. - Inconsistent or outdated information being used in financial analyses and reports. - Increased risk of non-compliance with regulatory requirements and data protection standards. These challenges can result in poor financial performance. Over time, you also risk weakening your company’s position in the market. [Navigating the trifecta: Growth, sustainability & complianceHow finance leaders can harness AI, automation, and business insight to drive growth, manage risk, and stay relevant in a changing world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-453.png)Finance AllianceParul Goel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--78--3.png)](https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/) ### **Solution: Enhancing data accessibility and implementing robust governance practices** To tackle these common data management problems and solutions, consider the following strategies: **1\. Centralize data storage** Consolidate financial data into a central repository, making it easier for authorized personnel to access and retrieve the information they need for analysis and [data-driven decisions](https://www.financealliance.io/become-a-data-driven-decision-maker-dddm-part-1/). **2\. Implement role-based access controls** Define clear roles and permissions for data access, ensuring employees can access only the data relevant to their job responsibilities. This helps maintain [data security and minimizes the risk](https://www.financealliance.io/the-cfo-role-in-cyber-risk-management/) of unauthorized access. **3\. Establish data governance frameworks** Develop and implement data governance frameworks outlining data ownership, stewardship, and accountability within the organization. This includes defining data quality standards, data lifecycle management processes, and guidelines for data usage and sharing. **4\. Provide training and support** Offer regular training and support to employees to ensure they understand data governance practices and can effectively access and use financial data in their roles. ## **6\. Problem: Resource constraints and skill gaps** In many organizations, finance professionals [face resource constraints and skill gaps,](https://www.financealliance.io/top-10-fp-a-skills-to-master/) which can hinder their ability to effectively manage and analyze data. Insufficient resources and a lack of expertise in data management can lead to the following issues: - Inability to leverage advanced analytics and data-driven insights for decision-making. - Poor data quality, resulting in unreliable financial reports and analyses. - Increased risk of non-compliance with regulatory requirements and industry standards. These challenges can limit your ability to compete and grow in an increasingly data-driven business environment. [Top 20 FP&A skills (10 hard skills & 10 soft skills)Here are the top 20 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-454.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--2--6.png)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) ### **Solution: Addressing resource constraints and closing skill gaps** To overcome resource constraints and skill gaps, think about: **1\. Investing in training and development** Provide ongoing training and development opportunities for finance professionals, equipping them with the necessary skills to manage, analyze, and draw insights from [financial data](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/). **2\. Leveraging technology and automation** Adopt advanced data management tools and technologies that automate manual tasks, improve data quality, and allow finance professionals to focus on more strategic and value-added activities. [How generative AI is transforming financeFinancial advisors could use AI to generate initial investment recommendations while focusing their expertise on understanding client needs and providing personalized guidance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-455.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--9--3.png)](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) ## **7\. Problem: Data automation and structuring unstructured data** A significant portion of financial data exists in unstructured formats, such as emails, documents, and reports. Extracting valuable insights from this unstructured data can be a daunting task. Not to mention, [manual processes and data entry can be](https://www.financealliance.io/fp-a-automation/) time-consuming and prone to errors, leading to data management challenges such as: - Loss of valuable insights hidden within unstructured data. - Inefficient use of resources on repetitive and manual tasks. - Increased likelihood of errors and inconsistencies in financial data. ### **Solution: Embracing automation and transforming unstructured data** If you want to resolve these issues, here are some possible solutions that can help: **1\. Implement data extraction and transformation tools** Utilize advanced tools and technologies, such as natural language processing (NLP) and optical character recognition (OCR), to extract valuable information from unstructured data sources and convert it into structured formats for easy analysis. **2\. Adopt Robotic Process Automation (RPA)** Implement RPA solutions to automate repetitive, manual tasks in finance, such as data entry, reconciliations, and report generation. This can improve [efficiency](https://www.financealliance.io/business-process-optimization/), reduce errors, and free up time for more strategic activities. **3\. Invest in AI and machine learning technologies** Leverage [artificial intelligence](https://www.aiacceleratorinstitute.com/your-guide-to-artificial-intelligence/) (AI) and [machine learning](https://www.aiacceleratorinstitute.com/your-guide-to-machine-learning/) (ML) solutions to analyze and process large volumes of structured and unstructured financial data more effectively. These technologies can help uncover hidden patterns, trends, and insights that drive better decision-making. **4\. Promote a data-driven culture** Encourage employees to embrace [data-driven decision-making](https://www.financealliance.io/use-management-dashboards-to-make-fast-data-driven-decisions/) by providing them with the necessary tools, training, and support. Foster a culture of continuous learning and improvement, where individuals are empowered to leverage data and technology to drive the organization's success. [How I’m thinking about AI after 27 years in financeAfter 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-456.png)Finance AllianceGeeta Malhotra![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--1.png)](https://www.financealliance.io/ai-in-finance-business-strategy/) ## **Bonus problem: Data inaccuracy and quality** Poor data quality is one of the biggest roadblocks to effective financial reporting and analysis. When your data is incomplete, inconsistent, or just plain wrong, every decision you make becomes questionable. Common data quality issues include: - **Missing or incomplete records:** gaps in transaction data, customer information, or financial metrics - **Duplicate entries:** the same transaction recorded multiple times, inflating your numbers - **Inconsistent formatting:** dates in different formats, varying currency codes, or mixed naming conventions - **Outdated information:** stale customer data, expired pricing, or old organizational structures - **Data entry errors:** typos, transposed numbers, or incorrect categorizations These problems compound quickly. A small error in your source data can cascade through multiple reports, leading to incorrect forecasts, flawed budgets, and poor strategic decisions. ### **Solution: Implement data validation and cleansing processes** Start with data governance policies that define quality standards for each data source. Set up validation rules that catch common errors before they enter your system, things like format checks, range validations, and required field enforcement. Regular data audits help you spot patterns in quality issues. Look for trends in where errors originate and address those root causes. Sometimes it's a training issue, sometimes it's a system configuration problem. Consider implementing data lineage tracking so you can trace any piece of information back to its source. When you find an error, you'll know exactly where it came from and what other data might be affected. Modern data quality management goes beyond manual spot checks. Many teams now use automated data profiling to monitor completeness, consistency, duplicates, and unusual changes in real time. AI and machine learning can also help detect anomalies and flag issues before they affect financial reporting. Tools such as Informatica, Talend, and dbt can support continuous quality checks as data moves through your pipelines. ### **Bonus tips** Below, [Pat Romano](https://www.linkedin.com/in/patromano32/) (Director, Finance BI and Strategic Enablement at Dow Jones), shares four bonus tips to help you resolve some of these common data management problems. *"Many of these will remain a challenge if you can't establish some or all of the following:* 1. *Leadership buy-in, engagement, and vision.* *2\. Clear and collective organizational data strategy to help make the vision become a reality together (not on your own in Finance) and help prioritize what problems to solve first or at all (sometimes good enough or subpar will do based on priorities).* *3\. Collaboration and partnership between functional leaders and teams - it's hard to move the needle in Finance without partnering heavily with your Finance Tech, CDO, IT, etc leads and teams.* *4\. If you can afford it.. a dedicated person or team to think about this as part of or their entire role - enables someone to step out of their day-to-day shoes and think about the bigger picture for the greater good of the team/company."* --- ### **FAQs - Data management challenges** What is a data management system? A data management system is a set of tools, processes, and practices designed to organize, store, protect, and provide access to an organization's data. It encompasses data storage, data quality, data integration, data security, data governance, and data analytics. A well-designed data management system ensures that data is accurate, consistent, and accessible, allowing organizations to make data-driven decisions and optimize their operations. Why are database performance issues so common? Database performance issues are common for several reasons. Some of the main factors include inadequate hardware resources, inefficient database design, poorly optimized queries, and lack of proper indexing. As organizations grow and their data volumes increase, databases can become more complex, making it challenging to maintain optimal performance. Regular monitoring, optimization, and maintenance are crucial to identifying and resolving performance issues. What are some quick tips to solve data management problems? To quickly address data management problems, centralize data storage, implement role-based access controls, and establish data governance frameworks. Regularly monitor and maintain your databases, foster a data-driven culture, invest in data management tools, and provide continuous education and training for your employees. These steps can help you efficiently tackle data management challenges and optimize your organization's data usage. ### 5 cost-reduction strategies every CFO should know URL: https://www.financealliance.io/5-cost-reduction-strategies/ Last updated: 2026-03-19T10:41:50.000Z In [an economic climate rife with challenges](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/), businesses are constantly hunting for ways to trim expenses without slashing their growth potential. As a CFO, you're at the helm, steering your company toward financial stability. But how do you cut costs *without* cutting corners? Below, we dive into five effective cost-reduction strategies to help you reduce costs and keep the cash rolling in.👇🏼 ## **1\. Conduct a comprehensive cost analysis** Before you can reduce costs effectively, you need a clear picture of where your money's going. [A thorough cost analysis](https://www.financealliance.io/cost-benefit-analysis/) gives you that baseline and helps you focus on the savings opportunities that'll have the biggest impact. Start by gathering 12–24 months of financial data across departments, vendors, systems, and recurring expenses. Look beyond large line items and review smaller repeat charges too. In many businesses, unnecessary spend hides in subscriptions, fragmented purchasing, low-value vendors, or inefficient processes. ### **Map your spending patterns** Break your costs into categories such as fixed vs. variable, direct vs. indirect, and essential vs. discretionary. This helps you see which expenses are tied to growth, which are operational necessities, and which may be reduced without harming [performance](https://www.financealliance.io/32-cfo-kpis/). You should also look for concentration points. Often, a small number of categories, suppliers, or workflows account for most business spending. Identifying those areas makes it easier to prioritize your cost reduction efforts. Understanding what drives costs is key to controlling them. [Cost drivers](https://www.financealliance.io/cash-flow-drivers-in-a-business/) are the specific elements that impact the cost of running your business. We're talking about anything from operational inefficiencies to raw material costs, and even regulatory compliance. [How to create a budget allocation plan for a companyBudget allocation is the process of dividing your company’s financial resources between departments. As you can imagine, it can be a tricky process to get right. Everyone wants a bigger piece of the pie, and you can’t always please everyone.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-434.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--7--1.png)](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) ### **Benchmark against industry standards** Once you understand your internal spend, compare it to relevant benchmarks. These might include cost as a percentage of [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/), headcount-related costs, software spend, procurement spend, or operating margin targets within your industry. Benchmarking helps answer an important question: are your costs high because of your business model, or because of inefficiency? That distinction matters when you decide what to reduce, renegotiate, [automate](https://www.financealliance.io/fp-a-automation/), or redesign. ### **Create your cost baseline** Document your current cost structure before making any changes. Your cost baseline should include total spend by category, seasonal patterns, one-off expenses, and any growth-related investments that may affect future comparisons. This gives you a reliable starting point for tracking savings, measuring ROI, and proving which initiatives actually work. Without a baseline, it's much harder to separate real savings from normal fluctuations in spend. ## **2\. Good costs, bad costs: Know the difference** Think all costs are created equal? Think again. There's a fundamental difference between strategic costs and wasteful spending, and understanding this distinction is pivotal to your cost reduction strategy. Strategic costs are expenses that bring measurable value to your business, leading to a solid return on investment (ROI). They're the investments in product development, marketing campaigns that drive customer acquisition, or technology that improves efficiency; elements that genuinely move your business forward. Wasteful spending looks different. It's the dusty gym equipment nobody uses, expensive software subscriptions sitting idle, or [overlapping tools that duplicate functionality](https://www.financealliance.io/business-process-optimization/). These costs consume resources without improving outcomes or supporting growth. [Cost-benefit analysis: 5 steps to turn data into smarter choicesIf you want to learn more about what cost-benefit analysis is and how to do it, keep reading as we dive into five key steps to streamline your financial evaluations and drive smarter decisions. 🧠![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-435.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--6--8.png)](https://www.financealliance.io/cost-benefit-analysis/) ### **Evaluate costs through an ROI lens** Before cutting any meaningful expense, ask what return it creates. Does it save time, improve output, increase revenue, or reduce operational risk? If it does, you might need to optimize it rather than eliminate it entirely. A simple value analysis can help. Compare the cost of the expense with the tangible benefits it generates, whether that's labor savings, margin improvement, or enhanced customer service. Costs with strong returns should usually be protected, not removed. ### **Apply a strategic importance test** Here's a practical framework for cost evaluation. Ask yourself three questions about each major expense: 1. Does this cost directly support revenue generation? 2. Does it improve efficiency or reduce operational risk? 3. Does it help us maintain a competitive advantage? If you're answering no across all three, that expense becomes a prime candidate for reduction. This approach helps you avoid reactive cost cutting and make smarter, longer-term decisions that protect what matters most. ## **3\. Capture the easy wins** Some cost reduction tactics take months to deliver results, but others can start generating immediate savings almost right away. These quick wins are especially valuable because they improve [cash flow](https://www.financealliance.io/cash-flow-drivers-in-a-business/), build momentum, and help prove the value of your broader cost reduction efforts. ### **Start with vendor negotiation** Review your largest supplier agreements first, especially contracts that have renewed automatically or haven't been revisited in the last 12 to 24 months. Many vendors will offer discounts, revised pricing tiers, or bundled terms to retain your business. You'd be surprised how often supplier costs aren't actually fixed. ### **Run a subscription audit** Conduct a full subscription audit across software, services, memberships, and recurring tools. Look for duplicate platforms, inactive licenses, and add-ons that are no longer needed. This is one of the simplest ways to find immediate savings without affecting customers or operations. Subscription waste is easy to miss when it sits across teams and budgets. The upside is real: companies can typically [save 20-30% on SaaS spend](https://www.financealliance.io/how-cfos-can-reduce-their-saas-spend/) by auditing licenses and tightening up their software stack. [CapEx vs Opex | Key differences, examples & why it mattersMaster the difference between CapEx and OpEx to optimize budgeting and drive growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-436.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/capex-vs-opex-5.png)](https://www.financealliance.io/capex-vs-opex/) ### **Consolidate your suppliers** If you've got multiple vendors providing similar products or services, consolidation might reduce both direct purchasing costs and administrative overhead. Fewer suppliers often means better volume pricing, fewer invoices, less contract management, and stronger negotiation leverage. ### **Optimize payment terms** Payment terms affect both cost and cash flow. Could early payment discounts, longer payment terms, or revised billing structures [improve your working capital position](https://www.financealliance.io/the-best-working-capital-strategies-for-fp-a/)? It's a practical lever many businesses overlook. The key with these cost reduction tactics is to start early. They might not radically transform your bottom line overnight, but these incremental savings add up. Plus, demonstrating early successes helps foster a cost-saving culture within your team, leading to even more innovative ideas. ## **4\. Leverage automation and technology** Automation can reduce costs far beyond finance workflows. The biggest opportunities often come from [repetitive, high-volume processes that consume time](https://www.financealliance.io/fp-a-automation/), introduce delays, or create avoidable errors. Think of technology investment as a strategic lever for operational efficiency, not just a convenience. Sure, it requires upfront capital, but the long-term cost savings and improved accuracy make it worthwhile. ### **Start with high-volume, repetitive processes** Look for tasks that happen frequently, follow consistent rules, and require significant manual effort. Common examples include invoice processing, data entry, approvals, internal reporting, inventory updates, customer inquiries, and procurement [workflows](https://www.financealliance.io/secure-by-design-fp-a-automating-planning-without-expanding-the-fraud-surface/). Prioritize processes based on three factors: time consumed, error frequency, and the business impact of improving them. This helps you think more strategically about where process [automation](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) will deliver the greatest return. ### **Implement intelligent automation tools** Modern [cost reduction efforts increasingly rely on AI](https://www.financealliance.io/ai-playbook-cost-savvy/) and workflow automation tools that do more than basic task execution. Depending on the function, [these tools can support forecasting, spend analysis](https://www.financealliance.io/how-to-use-a-driver-based-forecast-to-drive-strategic-initiatives/), supplier selection, document processing, customer service triage, and workflow routing. If you're focusing on ways to [automate processes within the finance function](https://www.financealliance.io/how-finance-automation-is-changing-role-fpa/), here are a few specific areas to consider: **Accounts payable automation**: Streamline invoice processing by automatically capturing data, matching invoices to purchase orders, routing for approval, and scheduling payments. This eliminates manual data entry and reduces errors. [**Budgeting and forecasting**](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) **automation**: Gather and analyze data, generate accurate forecasts, and adjust budgets in real time based on changing business conditions. **Payroll automation**: Reduce time spent on data entry, tax calculations, and paycheck distribution while ensuring compliance with tax laws and labor regulations. [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-437.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--18.png)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) ### **Calculate and track automation ROI** You need a simple way to evaluate whether an automation investment makes sense. Compare current labor and error-related costs with implementation, [training](https://www.financealliance.io/top-10-fp-a-skills-to-master/), and software costs. Set realistic expectations too. Many automations produce visible time savings quickly, but the strongest ROI usually comes from sustained efficiency gains over several months. ## **5\. Optimize workforce and operational models** Labor and workplace decisions have a major effect on your overall cost structure. For many businesses, one of the biggest savings opportunities isn't a single budget line, it's how you organize work itself. ### **Calculate the true cost of your workspace** Before you can make smart decisions about remote work or hybrid models, you need to understand what office-based work actually costs. Start by calculating your cost per employee for physical workspace. Add up rent, utilities, office supplies, equipment, cleaning, security, and shared overhead. Then divide by your headcount. You might be surprised; many companies find this runs $8,000 to $15,000 per employee annually. Compare that to reimbursing remote workers for home office expenses and internet. The math often favors remote work, especially when you factor in reduced commute subsidies and office perks. [EBITDA calculator & guide to what it really tells youIn this simple guide, we’ll break it all down: what EBITDA is (and isn’t), how it compares to EBITA, when to use it, and we’ll also include a free EBITDA calculator you can use right away.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-438.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/EBITDA-calculator-5.png)](https://www.financealliance.io/ebitda-calculator-guide/) ### **Strategic outsourcing for non-core functions** Outsourcing works best when applied to functions that are necessary but not central to your competitive advantage. Think payroll processing, IT support, administrative tasks, or certain customer service functions. The key question: Can a third party do this work more efficiently, with better tools or more specialized expertise? If yes, outsourcing can deliver both cost savings and improved service quality. Common candidates for outsourcing include: - Accounting and bookkeeping - HR administration - IT helpdesk and maintenance - Data entry and processing - Customer support for routine inquiries ### **Build a flexible workforce model** A blended approach to workforce optimization can reduce fixed labor costs while improving your ability to scale. This might include full-time staff for core functions, contractors for project work, and outsourced teams for specialized tasks. This flexibility becomes especially valuable during growth phases, seasonal demand, or economic uncertainty. Instead of defaulting to layoffs during tough times, you can adjust your contractor and outsourced work first. Consider which roles truly need to be full-time employees versus those that could be handled by freelancers, agencies, or specialist partners. The goal isn't to eliminate jobs, but to match your workforce structure to your actual business needs. ## **Track and measure your cost reduction impact** Cost reduction only creates value if the savings are real, sustained, and not offset by new problems elsewhere. That's why measurement should be built into your strategy from the start. ### **Establish cost reduction KPIs** Track a mix of financial and operational metrics to get the full picture. Your core KPIs might include total savings achieved, savings by individual initiative, cost as a percentage of revenue, cost per unit produced, [procurement](https://www.financealliance.io/100-day-procurement-plan-for-finance-leaders/) savings, cycle time reduction, and ROI tracking on investments like automation or system upgrades. A good measurement framework combines both hard-dollar outcomes and efficiency improvements. Hard savings show up directly on your P&L; think reduced supplier costs or eliminated software licenses. Soft savings improve efficiency but don't immediately hit the bottom line, like faster processing times or reduced manual work. ### **Build a cost savings reporting dashboard** Create a simple dashboard that compares expected savings with actual results. Include initiative owners, timelines, target savings, realized savings, and current status for each project. This approach makes it easier to spot which initiatives are delivering and which need course correction. You'll also have the data you need for executive [reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) and budget planning. [What is a compliance report: A guide on compliance reportingA clear, no-fluff guide to compliance reporting for finance teams who do it all.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-439.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/compliance-report-blog-meta-2-5.png)](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) ### **Monitor for unintended impacts** Some cost reduction efforts create hidden costs if you're not watching closely. Track service quality metrics, employee turnover rates, customer satisfaction scores, and delivery performance alongside your savings numbers. Why does this matter? Because the goal is sustainable efficiency, not short-term cuts that weaken your business. If you're saving money on customer service but satisfaction scores are dropping, you might be creating bigger problems down the road. Regular monitoring helps you catch these issues early and adjust your approach before they become costly mistakes. --- Remember, the essence of strategic cost reduction isn't about mindlessly slashing expenses; it's about making smart decisions that will boost your business's financial health while preserving its integrity and growth potential. So, roll up those sleeves and get started—your company's bottom line will thank you! --- ### FAQs: Cost reduction strategies How can CFOs identify areas of potential cost savings? By using financial analysis, CFOs can highlight high-cost areas, wasteful spending, and opportunities for process improvement. What is a cost reduction strategy? It's a plan to lower expenses, focusing on unnecessary costs without compromising the product or service quality. Can cost reduction impact a company's quality or output? If not handled well, yes. That's why it's essential to focus on reducing unnecessary costs and improving efficiency, rather than across-the-board cuts. --- ### **Join our Slack community** It's an [empowering platform for finance professionals](https://www.financealliance.io/community/) like you, offering an exclusive space to connect, learn, and grow. We bring together diverse minds from the finance world, facilitating knowledge sharing and fostering innovation. From topical discussions and expert insights to collaborative projects, you'll find value in every interaction. [Join us](https://www.financealliance.io/community/) to stay updated with the latest in finance, network with peers, and contribute to shaping the future of our industry. [Join the Finance Alliance Slack CommunitySign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today! Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-433.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Meta_Images_Slack-Community-1-10.jpg)](https://www.financealliance.io/community/) ### Your ultimate financial month-end close checklist (11 steps you can follow) URL: https://www.financealliance.io/month-end-close-checklist/ Last updated: 2026-03-19T13:37:08.000Z Let's discuss something we know too well: the **month-end close process**. It comes around at the end of each month, yet many [finance](https://www.financealliance.io/) pros dread it! We get it; closing the books each month can feel like a massive task, filled with numbers, deadlines, and just a tad bit of stress (*okay, maybe more than a tad*). But here’s the thing: a smooth month-end close isn’t just about ticking boxes and meeting deadlines. When done right, it's a powerful tool that offers [insights](https://www.financealliance.io/mastering-data-storytelling/), drives decisions, and, believe it or not, can even bring a sense of calm. Whether you’re a seasoned finance pro or just starting, we’re here to guide you through the process. We've got some handy checklists, nifty tips, and a few tricks up our sleeve to transform your month-end close from a frantic scramble into a streamlined process. ![Month end close meme](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/month-end-close-meme-1.png) So, let’s dive in and make those numbers work *for* us, not *against* us! ## **What is the month-end close?** The month-end close is the process that companies go through at the end of each month to finalize their [accounting](https://www.financealliance.io/transforming-from-accounting-to-fp-a-business-partnering/) records and financial statements. It's a set of accounting procedures that includes reconciling accounts, reviewing transactions, posting adjusting entries, and preparing reports that accurately reflect your business's financial position. Put simply, it's about wrapping up all the financial activities of the month and making sure everything adds up just right. The month-end close process helps confirm that all income, expenses, assets, and liabilities have been recorded correctly, and it helps you catch discrepancies early before they compound. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-441.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-18.png)](https://www.financealliance.io/financial-charts-and-graphs/) ### **Why month-end close matters** A disciplined month-end close supports more than just bookkeeping accuracy. It gives you and your leadership team timely financial information for planning and decision-making, strengthens internal controls, and helps your business [stay aligned with compliance requirements](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/). Think of it as your monthly financial health check-up. You're gathering all the bits and bobs (sales, expenses, invoices, and receipts) and making sure they're all accounted for. It's about tracking down those pesky discrepancies, squaring away invoices, and making sure your [cash flow](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/) is well-charted. When you close consistently each month, quarter-end and year-end reporting becomes much easier and less disruptive. You're not just keeping things tidy; you're [writing the financial story of your business](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/), one month at a time. ### **How month-end differs from quarter-end and year-end closes** Month-end close is usually focused on validating transactions, reconciliation, recording adjustments, and producing routine financial statements. Quarter-end close often requires deeper review, more management analysis, and additional reporting steps. The year-end close? That's the most complex because it typically includes tax preparation, audit support, and a comprehensive review of your company's financial records. Many organizations aim to complete their month-end close within five to 10 business days. However, industry data shows that many [finance teams](https://www.financealliance.io/fp-a-team-structure/) still need six business days or more, which highlights how common close bottlenecks remain. Strong monthly close habits create a cleaner audit trail, reduce year-end stress, and improve [the overall quality of your financial reporting](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/). [Top 20 FP&A skills (10 hard skills & 10 soft skills)Here are the top 20 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-442.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--2--5.png)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) ## **Month-end close checklist** A [well-structured month-end close checklist](https://www.financealliance.io/month-end-close-checklist/) becomes much more manageable when you break it into three clear phases: pre-close preparation, close execution, and post-close review. This approach helps your team work in the right sequence, reduces last-minute scrambles, and ensures nothing important slips through the cracks. Before diving into the process, you'll want to gather the key records your team needs: revenue reports, accounts receivable aging, supplier invoices, expense receipts, bank and credit card statements, payroll records, and [inventory counts](https://www.financealliance.io/how-to-forecast-inventories/). Having these ready makes everything flow smoother. ### **Pre-close preparation (Days -3 to 0)** Start these tasks before the final day of the month to take pressure off your actual close process. **1\. Create or confirm your closing schedule** During the [month-end close](https://go.brex.com/rs/166-VEV-188/images/Brex%5FNetSuite%5FAccounting%5FData%5FStory.pdf), **56%** say they work longer hours per day. But this can be avoided by creating a closing schedule. Set up clear task ownership, deadlines, and dependencies for each close activity. Finance leads should nail down who's handling AP, AR, payroll, reconciliations, journal entries, and final review. This roadmap keeps everyone on track and prevents last-minute confusion. 💡 Use digital calendars and recurring reminders. Set up automated notifications for each task in your closing schedule to keep everyone accountable. **2\. Send cut-off reminders** Give department heads advance notice about deadlines for submitting expenses, approving bills, finalizing sales activity, and recording transactions. This simple step dramatically reduces late entries and missing documentation. **3\. Collect outstanding documentation** Hunt down missing invoices, receipts, purchase records, and approvals before the close begins. Your AP, AR, and department managers should resolve open items as early as possible to avoid delays later. **4\. Review recurring entries and system workflows** Double-check that recurring journal entries, depreciation schedules, amortization entries, and automated feeds are working properly. Catching system issues before the close prevents costly rework. [17 top finance business processesEffective and streamlined finance business processes keep companies running smoothly. They’re vital for sound financial management, which is essential for a company’s success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-444.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--15--2.png)](https://www.financealliance.io/17-finance-business-processes/) ### **Close execution (Days 1 to 5)** This phase focuses on recording activity, validating balances, and making the adjustments you need for accurate financial reports. **5\. Record all remaining transactions** Enter every approved invoice, cash receipt, deposit, payroll journal, and credit card transaction for the period. Your general ledger should reflect all known monthly activity before moving forward. 💡 Link your accounting software with bank accounts for automatic transaction updates. This reduces manual entry and helps you spot discrepancies faster. **6\. Perform key account reconciliation** Complete the core reconciliation work needed to validate your account balances: - Bank account reconciliation - Credit card reconciliation - Accounts receivable reconciliation - Accounts payable reconciliation - Intercompany reconciliation (if applicable) 💡 Use centralized digital systems for storing and categorizing receipts and invoices. This makes it much easier to match expenses with bank statements. **7\. Post adjusting entries** Record the adjustments needed to align [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) and expenses with the proper accounting period: - Accrued expenses - Revenue accruals or deferrals - Prepaid expense amortization - Depreciation and amortization - Inventory adjustments **8\. Review assets and liabilities** Analyze balance sheet accounts for unusual balances, old items needing follow-up, misclassifications, or items that might require write-offs or corrections. 💡 Keep a digital asset and liability ledger with regular updates throughout the month. This makes your month-end review quicker and more accurate. ### **Post-close review (Days 5 to 7)** Once transactions are recorded and accounts reconciled, focus on [reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/), review, and continuous improvement. **9\. Prepare financial reports** Generate your company's core reporting package: - Income statement - Balance sheet - Cash flow statement - Budget-to-actual reporting - KPI or management dashboards 💡 Use financial reporting tools that pull data directly from your accounting software. This ensures accuracy and saves time on report generation. **10\. Perform variance analysis and management review** [Review material month-over-month and budget variances](https://www.financealliance.io/the-variance-analysis-cycle/). Finance leadership should investigate unusual changes in revenue, margins, expenses, and working capital balances before sharing reports with stakeholders. **11\. Distribute reports and document follow-ups** Send finalized financial reports to stakeholders and note any issues uncovered during the close. Track unresolved items, bottlenecks, and process improvements so your next close runs even more efficiently. [5 cost reduction strategies for CFOs that protect growthAs a CFO, you’re at the helm, steering your company toward financial stability. But how do you cut costs without cutting corners?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-445.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--18-.png)](https://www.financealliance.io/5-cost-reduction-strategies/) ## **Common month-end close challenges and solutions** Even organized finance teams can run into recurring problems during the month-end close process. Addressing these issues directly can improve accuracy, reduce delays, and make financial reporting more predictable. ### **Missing or incomplete documentation** **Challenge:** Missing receipts, invoices, approvals, or supporting records slow down reconciliations and force the team to spend time chasing information. **Solution:** Build document collection into the month instead of waiting until close week. Use shared folders, automated reminders, and clear submission deadlines for departments that regularly provide expense and invoice support. ### **Tight deadlines and time pressure** **Challenge:** When too many close tasks are packed into a few days, errors become more likely and review time gets compressed. **Solution:** Move repeatable work earlier in the month. Complete preliminary reconciliations, review recurring entries in advance, and prepare known accruals before the last day whenever possible. A more continuous workflow reduces close-day pressure. ### **Poor team coordination** **Challenge:** Close tasks often involve accounting, operations, payroll, AP, and AR. Without clear ownership, [teams can miss deadlines or duplicate effort](https://www.financealliance.io/financial-accountability/). **Solution:** Use a shared closing schedule with task owners, due dates, and dependencies. During close week, short daily check-ins can help surface blockers quickly and keep the process moving. ## **Best practices for faster month-end close** If your team wants a faster and more consistent close, [focus on process improvement](https://www.financealliance.io/business-process-optimization/) as much as task completion. The most effective month-end close best practices combine standardization, automation, and better timing. ### **Embrace automation strategically** [Start by automating repetitive, high-volume work](https://www.financealliance.io/fp-a-automation/) like bank feeds, recurring entries, expense imports, and standard reporting. [PwC found that 60% of FP&A data](https://www.pwc.com/id/en/services/accounting-advisory-services/workiva/helping-you-navigate-the-fp-a-journey.html) still needs manual manipulation, and over 80% of FP&A work happens in offline databases and spreadsheets, so automation can give you real time back for exceptions, review, and analysis. ### **Standardize your close process** Document each step of the close in a checklist that includes task owners, deadlines, and review points. Standardization improves consistency, supports training, and reduces the risk of missing key reconciliation or reporting steps. ### **Implement continuous close practices** Daily cash reviews, weekly subledger checks, and mid-month reconciliations can seriously cut down your final close workload. In [The CFO's First 90 Days Playbook](https://www.financealliance.io/the-cfos-first-90-days-playbook/), one CFO shares that their close was about three and a half weeks, and the goal was getting to a standard 10-day close. These habits are how you get there. ### **Leverage system integrations** Connect your accounting system with payroll, billing, expense management, and banking tools where possible. Better integrations reduce manual uploads, improve reconciliation speed, and strengthen the reliability of financial reporting data. ## **FAQs: Month-end closing process** #### ****What is end-of-month reporting in accounting?** End-of-month reporting in accounting refers to the process of compiling and analyzing financial data at the end of each month. This includes preparing financial statements such as the balance sheet, income statement, and cash flow statement. The purpose is to provide a comprehensive overview of the company's financial performance and position at the end of each month. #### ****What is a month-end close checklist?** A month-end close checklist is a detailed list of tasks and procedures that need to be completed as part of the month-end close process. This checklist typically includes activities such as reconciling bank statements, recording transactions, verifying account balances, and preparing financial reports. It serves as a guide to ensure a thorough and accurate closing process. #### ****What is a month-end close process?** The month-end close process is the series of tasks and procedures performed by a company's finance team to close out the financial records for a month. This process includes reconciling accounts, recording transactions, adjusting entries, and preparing financial reports. The goal is to accurately reflect the company's financial activities and position at the end of each month. #### ****How long should the month-end close process take?** The duration of the month-end close process can vary depending on the size and complexity of the business. Typically, it can take anywhere from a few days to a week. However, efficient processes and automation can significantly reduce this time. #### ****What role does technology play in the month-end close?** Technology plays a crucial role in streamlining the month-end close process. It enables automation of repetitive tasks, provides real-time data for faster reconciliation, and improves accuracy through integrated accounting systems. #### ****Can the month-end close process be accelerated?** Yes, the month-end close process can be accelerated by implementing efficient workflows, automating routine tasks, maintaining up-to-date records throughout the month, and utilizing robust accounting software. #### ****How can a company improve its month-end close process?** A company can improve its month-end close process by training staff on best practices, implementing effective accounting software, regularly reviewing and updating procedures, and ensuring clear communication and collaboration among team members. ### **Take your finance career to the next level** Mastering the month-end close is just one step in building a successful finance career. Whether you're looking to streamline your processes further, learn advanced FP&A techniques, or connect with finance leaders who've conquered these challenges, continuous learning is key. Ready to accelerate your finance career? [Join Finance Alliance Pro+](https://www.financealliance.io/pro-plus-membership/) and gain access to exclusive templates, frameworks, and expert-led workshops designed to help you excel. From pre-built financial models to mentorship from industry veterans, Pro+ gives you the tools and knowledge to transform from a good finance professional into an exceptional one. Don't just close the books; open new doors in your career. [Finance Alliance Pro+ membershipBe one of the first to join Finance Alliance’s membership where you can access world-class finance resources and the all-in-one platform for networking and career advancement.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-440.png)Finance AllianceDev Team![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Membership_Meta_Images_-1-1.png)](https://www.financealliance.io/pro-plus-membership/) ### What is ESG? 7 key benefits of ESG investing URL: https://www.financealliance.io/7-benefits-of-esg-investing/ Last updated: 2026-03-17T15:46:13.000Z In the past, [environmental, social, and governance](https://www.financealliance.io/esg-metrics/) (ESG) factors tended to feel like a bit of a sideline concern for many finance teams *and* their companies. Sure, they were important, but did they *really* move the needle on portfolio performance? The answer, as most of us have come to realize, is a resounding *yes.* ESG is rapidly becoming a core competency in our field and used to manage risk and facilitate [sustainable](https://www.financealliance.io/how-cfos-can-scale-brands-worldwide/), long-term returns. The rise of ESG investing shows no signs of slowing down, with the market [projected to grow to 180.78 trillion by 2034](https://www.fortunebusinessinsights.com/esg-investing-market-113824). But why the rise? And what, exactly, are the benefits of ESG investing? ### **Topics covered:** - [What ESG means](https://www.financealliance.io/p/408acec8-706d-4fc0-9a17-5d344274ebf2/#what-is-esg) - [Why ESG is so important](https://www.financealliance.io/p/408acec8-706d-4fc0-9a17-5d344274ebf2/#why-is-esg-investing-important) - [The benefits of ESG investing](https://www.financealliance.io/p/408acec8-706d-4fc0-9a17-5d344274ebf2/#7-benefits-of-esg-investing) - [6 challenges associated with ESG investing](https://www.financealliance.io/p/408acec8-706d-4fc0-9a17-5d344274ebf2/#6-challenges-associated-with-esg-investing) --- ## **What is ESG (and how does it work)?** Before diving into the benefits, let's clarify what ESG means and how it works in practice. ESG stands for environmental, social, and governance. It's a framework investors use to evaluate how responsibly and sustainably a company operates alongside traditional [financial metrics](https://www.financealliance.io/32-cfo-kpis/). ### **Understanding the three pillars** Each ESG pillar looks at a different part of business performance: **Environmental:** A company's impact on the planet, including carbon emissions, energy use, waste management, water usage, deforestation, biodiversity, and climate risk exposure. **Social:** How a company treats people, including employees, customers, suppliers, and communities. This covers diversity and inclusion, human rights, fair labor practices, workplace safety, employee welfare, and data security, highlighting [the role of big data security analytics](https://www.financealliance.io/what-is-big-data-security-analytics/) in safeguarding sensitive information. **Governance:** How a company is managed, including board diversity, executive pay, political contributions and lobbying, bribery and corruption, business ethics, and transparency. ### **How ESG investing works in practice** ESG investing adds another layer to traditional investment analysis. Instead of looking only at revenue, profitability, and growth, investors also assess how well a company manages environmental, social, and [governance](https://www.financealliance.io/finance-and-compliance/) risks. For example, an investor reviewing a technology company might examine its renewable energy usage, employee turnover, board independence, and data privacy record before deciding whether it belongs in a portfolio. Investors may use ESG criteria in several ways: - Screen out companies with weak ESG practices - Favor companies with stronger ESG performance - Compare peers within the same industry - Use ESG insights to identify long-term risks and opportunities [When financial hedging falls short: Resilience beyond derivativesIn a world where the next crisis always differs from the last, the ability to survive the unforeseeable matters more than perfectly hedging the risks we can measure.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-425.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--12--1.png)](https://www.financealliance.io/when-financial-hedging-falls-short-why-companies-need-resilience-beyond-derivatives/) ### **Common ESG metrics, scores, and ratings** ESG performance is often measured using third-party research and ratings from providers such as MSCI, Bloomberg, and CDP. Common ESG metrics include: - Carbon emissions and energy efficiency - Workforce diversity and employee safety - Board independence and executive accountability ESG scores and ESG ratings help investors compare companies, but methodologies vary. That's why it's best to review more than one source and understand what each rating system emphasizes. ESG funds peaked in popularity in 2021, attracting $649 billion in inflows, but growth has since slowed significantly. In 2024, global sustainable funds drew just $54.7 billion in inflows, reflecting changing market conditions, performance pressures, and increased scrutiny around ESG strategies. ### **ESG vs traditional investing** Traditional investing focuses mainly on financial return potential. ESG investing still considers financial performance, but also asks whether a company is managing [sustainability and corporate responsibility](https://www.financealliance.io/7-benefits-of-a-cash-flow-forecast-to-drive-sustainable-business-growth/) issues that could affect long-term value. In short, traditional investing asks, "Is this company profitable?" ESG evaluation asks, "Is this company profitable, resilient, and responsibly managed?" For investors, it's about investing in values *alongside* money. [17 top finance business processesEffective and streamlined finance business processes keep companies running smoothly. They’re vital for sound financial management, which is essential for a company’s success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-426.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--15-.png)](https://www.financealliance.io/17-finance-business-processes/) ## **7 benefits of ESG investing** ESG investing offers compelling advantages that extend beyond traditional financial returns. Here's why more investors are incorporating environmental, social, and governance factors into their portfolios. ### **1\. Improved risk management** [82% of the world’s largest companies now include ESG](https://kpmg.com/xx/en/our-insights/esg/the-move-to-mandatory-reporting.html) information in their annual reports. From environmental regulations to shifting consumer demands, companies that prioritize ESG are better equipped to manage whatever comes their way. ESG investing means being pickier about *who* you choose to work with. By integrating ESG criteria into your investment strategy, you might choose to work with companies that champion clean energy and responsible resource use, not those harming the environment through things like deforestation or relying heavily on fossil fuels. *That's* the power of ESG investing. It lets you align your money with your values while also avoiding risks. By focusing on ESG factors, you can invest with confidence by mitigating hidden risks associated with environmental regulations, social unrest, and poor [corporate governance](https://www.financealliance.io/finance-and-compliance/). Here are some ‘green flags’ to help you identify companies that focus on ESG (and some key points that potential investors might be looking for when choosing whether to invest in *your* company). ![ESG investing benefits](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/ESG-investing-benefits-2.png) ### **2\. Enhanced portfolio performance** ESG performance doesn't have to come at the expense of returns. Companies in the [top 20% of ESG scores outperformed](https://senecax.com/insights/esg-and-financial-performance-insights-impact-strategy-2025/) those in the bottom 20% over the 2012–2023 period. It's not a guarantee, but it's a solid signal that better-managed companies often show up in the numbers. It’s also been noted that companies with sustainability strategies usually achieve: - Enhanced operational efficiency - Increased cost savings - Lower employee turnover - Retained talent - Reduced compliance costs ### **3\. Making a positive impact on the environment** So, how are companies making a positive impact on the environment through ESG practices? Well, many ways, actually. For example, more companies are investing in green bonds. Green bonds aim to fund projects which deliver positive environmental goals such as reducing carbon emissions, improving air quality, and promoting sustainable resources and clean transportation. Another example is sourcing materials from suppliers who reflect a similar commitment to environmental responsibility. For example, choosing a supplier who uses recycled materials in their packaging vs a supplier who uses a ton of plastic. Prioritizing ESG can also majorly influence businesses to undertake initiatives to reduce their carbon footprint by increasing energy efficiency and sourcing renewable energy. This can lead to significant emissions reductions at the corporate level. ### **4\. Greater innovation and adaptability** The rise of ESG investing fuels demand for sustainable products. Companies, eager to stay profitable and project a positive image, respond by innovating and launching eco-friendly options. This creates a win-win: it benefits the environment and keeps businesses competitive. ESG investing also promotes more efficient use of resources. This can lead to innovations that help companies reduce waste, save energy, lower costs, and remain competitive in the market. Businesses that are conscious of ESG criteria are also more adaptable. They’re able to anticipate and [mitigate risks](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) associated with climate change and adapt their strategies to stay ahead of new regulatory changes. There are a few companies that have successfully adapted to ESG principles and achieved business success in recent years. For example: - [Cisco](https://www.cisco.com/c/m/en%5Fus/about/purpose/reporting-hub.html) now matches 100% of its global electricity consumption with renewable energy across its operations. - [Verizon](https://sustainabilitymag.com/news/verizon-sustainability-clean-networks-smarter-ev-fleets) sourced renewable energy equal to 56% of its electricity use in 2024, targeting 100% by 2030. ESG investing pushes companies beyond short-term gains. It plays a huge role in creating a future-focused mindset, where [innovation](https://www.financealliance.io/how-great-organizations-fuel-innovation-through-esg-and-diversity/) and adaptability become essential for navigating changing regulations, resource scarcity, and evolving consumer demands. ### **5\. Attracting and retaining talent** ESG investing also provides social benefits and fosters a positive working environment. When businesses place emphasis on policies that protect employee welfare, promote a healthy work-life balance, and ensure a safe working environment, they’re more likely to [attract and retain top talent](https://www.financealliance.io/finance-talent/). Carolina M. Veira (CEO & Founder of Veira Financial) believes that most employees prefer to work for companies that are socially and environmentally responsible: > “Employees are going to be looking for organizations that are going to help them become better citizens and that align with their values. The new generations are especially very concerned about the environment.” Companies that adhere to high ethical standards and business practices often have a better reputation than most, and therefore are able to attract top-performing employees. [Guide to building stronger cross-functional relationshipsWant to know how finance can build stronger cross-functional relationships? Read this blog to learn more.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-427.png)Finance AllianceKavin Soni![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--75--2.png)](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/) ### **6\. Strengthened regulatory compliance** ESG investing helps businesses prepare for regulatory changes and avoid potential penalties. By focusing on environmental practices, treating employees well, and having solid leadership, companies can avoid getting caught off guard by new regulations or slapped with fines. They can stay ahead of the curve and transition to greener technologies ahead of stricter environmental regulations, and therefore avoid future compliance costs. Implementing ESG principles can also reassure investors that a business is stable, responsible, and prepared for any future regulatory changes. In fact, companies with higher ESG scores [experience significantly lower risk exposure](https://www.emerald.com/jfra/article/doi/10.1108/JFRA-12-2024-0953/1279008/Firm-value-and-risk-how-relevant-are-ESG-factors) during controversies compared to lower-scoring peers. ### **7\. Contribution to global sustainability goals** ESG investments can be a game-changer in achieving the ambitious goals set out by the United Nations in 2015: the [17 Sustainable Development Goals](https://sdgs.un.org/goals). These goals aim to tackle some of humanity's biggest challenges by 2030, from eradicating poverty and hunger to achieving gender equality and protecting our planet. Here's how ESG investing directly fuels progress towards these SDGs: - **Investing in renewable energy companies:** This directly supports SDG 7, "affordable and clean energy." By putting your money behind these businesses, you're helping to create a cleaner, more sustainable future. - **Backing companies with strong diversity and inclusion practices:** This contributes to achieving SDG 5, "gender equality," and SDG 10, "reduced inequalities." When you invest in companies that champion equal opportunities and fair treatment for all, you're sending a powerful message and promoting a more just and equitable world. These are just a few examples. By prioritizing ESG factors, investors can support companies across various sectors that are actively working towards these critical goals. This creates a powerful ripple effect, driving positive change throughout the business world and propelling us closer to a more sustainable and equitable future. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-430.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-17.png)](https://www.financealliance.io/financial-charts-and-graphs/) ## **6 challenges associated with ESG investing** The many benefits of ESG don’t come without their challenges. Here are the main obstacles that companies should be mindful of when implementing ESG initiatives: ### **1\. Standardization** As ESG metrics are not yet fully standardized, investors have to rely on company-defined figures. Therefore, the information provided might not be completely reliable, and poor business practices may be overlooked. ### **2\. Transparency** ESG reporting can be a challenge as companies don’t always have the required software, data, or a sound understanding of these types of metrics. And because many companies have different interpretations of what actually constitutes strong [ESG performance](https://www.financealliance.io/are-you-prepared-for-esg-and-sustainable-finance/), it becomes tricky for investors to make accurate comparisons. ### **3\. Greenwashing** A lack of standardized data can sometimes lead to greenwashing. Greenwashing occurs when companies claim that their products are more environmentally friendly than they actually are. This can make customers lose trust in a company, ultimately damaging their reputation. ### **4\. Regulations** As global awareness of ESG issues increases, governments may decide to impose new regulations which can affect the value of existing ESG investments. Therefore, understanding and keeping up with regulatory shifts is crucial to mitigate potential risks. ### **5\. High costs** Integrating ESG factors into [financial analysis](https://www.financealliance.io/microsoft-fabric-for-data-analysis/) and investment isn’t a straightforward process. It requires a deep understanding of how ESG can affect financial performance. As such, companies may need to spend a significant amount of money on additional research, due diligence, and trained professionals in ESG investing. ### **6\. Investment time** The benefits of ESG investing are often reaped over a long period of time. However, many investors are looking for shorter-term returns, which could lead to disappointment or misinterpretation of an ESG strategy's effectiveness. [CapEx vs Opex | Key differences, examples & why it mattersMaster the difference between CapEx and OpEx to optimize budgeting and drive growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-431.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/capex-vs-opex-4.png)](https://www.financealliance.io/capex-vs-opex/) ## **ESG investing: A game-changer in modern finance** As we've seen, there are plenty of ESG benefits to consider. From enhanced portfolio performance and improved risk management to fostering innovation and making a positive impact on global challenges, ESG is the key to long-term profitability and a positive reputation for your brand. While there are hurdles to overcome, such as the lack of standardized ESG metrics and risks involved with greenwashing, the potential for making positive changes in the financial landscape is enormous. By leveraging ESG principles, businesses not only stand to reap massive economic returns but can contribute to a better world for all, helping them [embed positive change in finance](https://www.financealliance.io/embed-positive-change-framework/). ESG investing is no longer just a trend, it’s a key component of responsible and forward-thinking financial strategy, encouraging finance teams to shift [from CFO no to strategic growth partner](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/). --- ### FAQs What is ESG and why is it important? ESG stands for environmental, social, and governance, and is a set of criteria used to assess a company’s sustainability and societal impact. ESG helps investors to identify companies that are more sustainable and better positioned for long-term success. ESG also helps investors to steer clear of potential financial risks linked to poor environmental or societal practices. How can ESG benefit business? ESG can help businesses to manage potential operational, regulatory, and reputational risks to ensure long-term resilience and success. Companies can also enhance their brand reputation, and find innovative ways to increase efficiency and reduce costs through energy-saving measures and waste reduction, improving their overall financial performance. How does ESG help sustainability? By adopting ESG principles, companies are encouraged to consider the wider impact of their operations and strive for positive change. They’re motivated to reduce their carbon footprint, manage waste responsibly, and protect biodiversity to help mitigate the effects of climate change and preserve natural resources. Is ESG Investing good? There's growing evidence that strong ESG practices can lead to long-term financial benefits for companies. On top of that, ESG investing also helps you to align your portfolio with your values and contribute to a more sustainable future. What is ESG factor investing? ESG factor investing considers environmental, social, and governance factors alongside traditional financial metrics when making investment decisions. This helps identify companies with strong long-term potential. Why do investors like ESG? Investors are increasingly interested in ESG for various reasons, including potential for positive financial returns, alignment with personal values, and the chance to support companies making a positive impact on the world. What are the disadvantages of ESG Investing? Some ESG funds may have limited investment options, and data measuring ESG performance can vary. It's important to do your research before investing. Is ESG investing ethical? ESG investing allows you to focus on companies demonstrating ethical behavior in environmental and social practices, alongside good governance. How does ESG impact investors? ESG considerations can help investors identify companies with strong risk management and long-term growth potential, potentially leading to positive financial returns. Why should investors care about ESG risks? ESG factors can pose financial risks to companies, such as climate change regulations or labor disputes. Considering ESG helps investors identify and potentially avoid these risks. Why do investors like sustainability? Sustainable companies are often well-positioned for the future, considering resource scarcity, changing regulations, and consumer preferences. Investing in sustainability can be a way to support companies prepared for long-term success. --- ### **Continue the conversation inside our Slack community** If you’d like to talk to other finance professionals about ESG and sustainable finance, why not join our free Slack community? It's the perfect place for finance pros to connect, network, share job opportunities, ask questions, and share ideas. You can sign-up to our[ Slack Finance Alliance community](https://www.financealliance.io/community/) right here. [Join the Finance Alliance Slack CommunitySign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today! Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-422.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Meta_Images_Slack-Community-1-8.jpg)](https://www.financealliance.io/community/) ### 17 finance business processes (simplified & explained) URL: https://www.financealliance.io/17-finance-business-processes/ Last updated: 2026-03-17T13:27:06.000Z Financial processes are the repeatable methods your finance team uses to manage money, record transactions, maintain [compliance](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/), and support better business decisions. In practice, these finance business processes cover everything from paying suppliers and collecting customer payments to closing the books and forecasting future performance. Strong financial processes are the foundation of effective finance operations. They help you improve accuracy, [reduce risk](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/), maintain control over cash flow, and give leadership the information needed to plan confidently. In the sections below, we break down the core financial processes that keep a business running and show where better systems, clearer workflows, and [automation](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) can make the biggest impact. [Acquisition financing: how it works and funding optionsDone right, acquisition financing fuels growth. Done poorly, it can sink the whole ship. The sweet spot is structuring a deal that makes strategic sense and positions your now-bigger company for continued success into the future.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-416.png)Finance AllianceChristopher Reed![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--14-.png)](https://www.financealliance.io/acquisition-financing/) ## **Core data and reporting processes** Every finance function depends on accurate data and reliable reporting. These processes create the information base for [analysis](https://www.financealliance.io/cost-benefit-analysis/), compliance, and strategic planning. ### **1\. Data collection** Data collection is the starting point for every finance workflow. It involves pulling information from [ERP systems](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/), bank feeds, payroll platforms, expense [tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/), billing systems, and operational software across the business. When data collection is inconsistent or manual, the problems carry through the rest of the finance cycle. Reporting becomes less reliable, reconciliations take longer, and decision-making suffers. That's why many teams prioritize automated integrations and standardized data inputs early in their process improvement efforts. ****Garbage in, garbage out:** This means if you use bad data, you'll get bad results. That's why accurate and up-to-date info is key! With good data, your reports are trustworthy and you can make way better decisions. ### **2\. Financial reporting** Financial reporting turns raw transaction data into usable insight. This includes producing core financial statements such as the income statement, balance sheet, and cash flow statement, as well as management reports for internal stakeholders. Strong financial reporting helps leaders understand performance, [monitor trends](https://www.financealliance.io/key-trends-shaping-the-future-of-finance/), and make faster decisions. It also supports investor confidence, audit readiness, and regulatory compliance. As reporting needs grow, [automation](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/) and dashboarding tools can help finance teams. ### **3\. Financial close process** The financial close process is the structured review of financial activity at the end of a month, quarter, or year. It typically includes account reconciliations, accruals, adjustments, variance review, and final sign-off on financial statements. [A slow or inconsistent month-end close](https://www.financealliance.io/month-end-close-checklist/) can delay reporting and reduce confidence in the numbers. Best-in-class teams improve close performance by standardizing checklists, assigning clear ownership, and automating repetitive reconciliation and validation tasks. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-417.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-16.png)](https://www.financealliance.io/financial-charts-and-graphs/) ## **Transaction and payment processes** Transaction and payment processes are the day-to-day workflows that keep money moving through your business. Because they're repetitive and high volume, they're often the first place [finance teams](https://www.financealliance.io/fp-a-team-structure/) look for efficiency gains. ### **4\. Accounts payable** Accounts payable (AP) covers the full invoice-to-payment cycle: receiving invoices, validating charges, routing approvals, and paying suppliers on time. It's where vendor relationships either strengthen or strain based on how smoothly you handle their payments. Weak AP processes create real problems: duplicate payments, missed early-payment discounts, and frustrated vendors who might tighten payment terms. You'll also find yourself drowning in manual invoice processing when volume picks up. The best AP workflows rely on clear approval rules, accurate invoice processing, and payment automation. This improves control while reducing the manual work that slows everything down. When done right, AP becomes a strategic advantage that improves cash flow and vendor relationships. ### **5\. Accounts receivable (AR)** Accounts receivable manages how you bill customers and collect cash. It includes invoice creation, payment tracking, collections, and managing overdue balances; basically everything that turns your sales into actual money in the bank. Faster, more consistent AR processes improve working capital and reduce collection risk. You can't afford to let receivables drag when cash flow matters. Best practices include clear payment terms, automated reminders, self-service payment options, and regular review of aging reports. The goal isn't just getting paid, it's getting paid quickly while maintaining good customer relationships. [Cost-benefit analysis: 5 steps to turn data into smarter choicesIf you want to learn more about what cost-benefit analysis is and how to do it, keep reading as we dive into five key steps to streamline your financial evaluations and drive smarter decisions. 🧠![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-418.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--6--7.png)](https://www.financealliance.io/cost-benefit-analysis/) ### **6\. Expense management** Expense management tracks employee and business spending, from card transactions and reimbursements to policy review and approval workflows. It's often where finance teams feel the most day-to-day friction. When expense processes are manual, they create delays, inconsistent policy enforcement, and poor visibility into spending. Employees get frustrated waiting for reimbursements, and you lose control over spending patterns. [Automated expense management tools](https://www.financealliance.io/fp-a-automation/) help you capture receipts quickly, apply controls consistently, and shorten reimbursement cycles. The result? Better compliance, happier employees, and clearer spending insights. ### **7\. Payroll processing** Payroll processing ensures employees are paid accurately and on time while handling tax deductions, benefits, and statutory obligations correctly. It's one area where mistakes have immediate, visible consequences. Payroll errors damage trust quickly, so accuracy and compliance aren't optional. Manual calculations increase error risk, especially as your team grows or tax requirements change. Automation helps reduce calculation errors, simplify filings, and maintain an auditable process across changing tax and labor requirements. When payroll runs smoothly, it's invisible. When it doesn't, it becomes everyone's problem. ## **Strategic planning and analysis processes** Not every finance process is about recording the past. Strategic finance processes help you [plan ahead, manage resources more effectively](https://www.financealliance.io/your-ultimate-guide-to-fp-a/), and support growth with better decision-making. ### **8\. Financial planning and analysis** FP&A connects financial data to business strategy. It involves analyzing results, identifying trends, building scenarios, and helping leadership make informed decisions. Modern [FP&A teams](https://www.financealliance.io/fp-a-team-structure/) do more than explain what happened. They help the business understand what's likely to happen next and what actions will improve performance. ### **9\. Budgeting** [Budgeting](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) sets spending and revenue expectations for a defined period, usually across teams, cost centers, or business units. A strong budgeting process aligns resources to strategic priorities and creates accountability across the organization. Many finance teams now combine [annual budgeting with more agile review cycles](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) to stay responsive as conditions change. ### **10\. Forecasting** [Forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) estimates future performance based on current data, assumptions, and market changes. Unlike a fixed budget, a forecast should be updated regularly as business conditions evolve. [Rolling forecasts, driver-based models, and scenario analysis](https://www.financealliance.io/driver-based-planning-forecasting/) can make forecasting more useful for fast-moving businesses. The real value isn't just predicting outcomes, but helping the business respond earlier. Budgeting and forecasting often go together because forecasting can help companies plan their budgets better, making sure they have enough money for important things like buying new products or hiring more staff. ### **11\. Treasury management** [Treasury](https://www.financealliance.io/corporate-treasury-guide-plus-3-strategies-to-save-your-company-a-fortune/) management focuses on liquidity, banking, funding, and financial risk. It helps ensure the business has the cash and capital structure needed to operate effectively. Good treasury practices improve visibility over cash positions, strengthen banking relationships, and reduce exposure to funding or market-related risk. ### **12\. Cash flow management** Cash flow management tracks how money moves in and out of the business so finance can plan for obligations, investment needs, and potential shortages. Even profitable companies can run into trouble if cash flow is poorly managed. [Regular cash monitoring, realistic forecasting](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) and close coordination with AP and AR are essential to maintaining financial stability. ### **13\. Capital expenditure (CapEx)** CapEx are funds used by a company to acquire, upgrade, and maintain physical assets such as property, industrial buildings, or equipment. Businesses will prioritize this type of investment because it plays an important role in its long-term growth and efficiency. For example, a manufacturing firm might invest in new machinery to increase production capacity and improve product quality. [CapEx vs Opex | Key differences, examples & why it mattersMaster the difference between CapEx and OpEx to optimize budgeting and drive growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-419.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/capex-vs-opex-3.png)](https://www.financealliance.io/capex-vs-opex/) ## **Compliance and control processes** Compliance and control processes protect the business. They reduce financial risk, support regulatory requirements, and help finance teams maintain trust in the numbers. ### **14\. Audit and compliance** Audit and compliance processes help verify that financial records are accurate and that the business is following internal policies and external regulations. These activities support [accountability](https://www.financealliance.io/financial-accountability/), reduce the risk of penalties, and improve confidence among stakeholders. Well-documented workflows and strong audit trails make compliance easier to manage at scale. ### **15\. Tax preparation** Tax preparation includes collecting records, calculating liabilities, and filing returns accurately and on time. It often requires close coordination across accounting, payroll, and legal or advisory teams. The strongest tax processes are proactive rather than reactive. Maintaining clean records throughout the year reduces filing pressure and lowers the risk of errors. ### **16\. Credit management** Credit management helps determine when and how to extend payment terms to customers. It balances revenue opportunity against the risk of late payment or bad debt. Effective credit processes combine clear policies, regular review of customer exposure, and strong communication with sales and AR teams. ### **17\. Risk management** Risk management identifies and addresses [threats that could affect financial performance or stability](https://www.financealliance.io/financial-crime-risk-management-fcrm/). This may include fraud risk, liquidity risk, market exposure, or operational breakdowns. Good risk management depends on clear controls, ongoing monitoring, and scenario planning. The goal isn't to eliminate all risk, but to understand it and respond in a structured way. [6 strategies for FP&A to master scenario planning and risk managementHow FP&A can help the organization prepare for potential outcomes, mitigate risk, and remain resilient and forward-focused.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-420.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-5-4.png)](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) ## **How to improve your finance processes** Listing finance processes is useful, but most readers also want to know how to make them better. The biggest gains usually come from simplifying workflows, reducing manual effort, and improving visibility across financial operations. ### **Identifying automation opportunities** Start by reviewing processes that are repetitive, rules-based, high volume, and heavily dependent on manual data entry. These are often [the best candidates for finance process automation](https://www.financealliance.io/how-finance-automation-is-changing-role-fpa/). Common examples include invoice processing, bank reconciliations, employee expenses, and payment reminders. Process mapping can help you spot bottlenecks, rework, approval delays, and duplicate effort before choosing a tool. ### **Implementation of best practices** [Successful process improvement usually starts small](https://www.financealliance.io/your-guide-to-finance-transformation/). Rather than redesigning everything at once, begin with one workflow, define the current-state process clearly, and involve the people who use it every day. Best practices include documenting ownership, standardizing approval paths, cleaning data inputs, testing workflows before rollout, and supporting teams through change. This reduces disruption and improves adoption. [EBITDA calculator & guide to what it really tells youIn this simple guide, we’ll break it all down: what EBITDA is (and isn’t), how it compares to EBITA, when to use it, and we’ll also include a free EBITDA calculator you can use right away.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-421.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/EBITDA-calculator-4.png)](https://www.financealliance.io/ebitda-calculator-guide/) ### **Measuring success** To show whether a process change is working, track metrics before and after implementation. Useful [KPIs](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) include processing time, error rates, close cycle time, cost per transaction, overdue balances, and employee effort. The goal isn't just efficiency for its own sake. The best process improvements free up time for more valuable work, such as analysis, planning, and strategic support. Effective and streamlined finance business processes keep companies running smoothly. They’re vital for sound financial management, which is essential for a company's success. Finance business processes help businesses to: - Track income and expenses - Allocate resources efficiently - Make informed spending decisions - Comply with financial regulations --- ## **Drive strategic business and career growth with FP&A Certified: Core** Ready to improve your financial planning and analysis (FP&A) skills and skyrocket your career growth? Our FP&A course is your gateway to mastering the skills and know-how needed to drive strategic business growth with the power of FP&A. This course is your comprehensive guide to mastering FP&A, including insights, case studies, and practical templates you won't find elsewhere. [Find out more](https://certified.thealliance.io/course/fpa-certified-core) ### FP&A Summit San Jose 2026 URL: https://www.financealliance.io/fp-a-summit-san-jose-2026/ Last updated: 2026-03-16T14:46:48.000Z Catch up with every talk from FP&A Summit San Jose and hear from the likes of Lyft, Autodesk, VISA and more. _This post is for paying subscribers only._ ### Virtual FP&A Summit 2026 URL: https://www.financealliance.io/virtual-fp-a-summit-2026/ Last updated: 2026-03-16T13:09:40.000Z Catch up on all of the sessions from the virtual FP&A Summit 2026. _This post is for paying subscribers only._ ### The ultimate 5-step stakeholder communication plan (that works) URL: https://www.financealliance.io/stakeholder-communication-plan/ Last updated: 2026-03-11T12:41:27.000Z ## **What is a stakeholder communication plan?** A stakeholder communication plan is a structured document that outlines how you'll share information with the people who influence or are affected by a project, initiative, or business decision. It forms part of your wider communication strategy and helps ensure the right people receive the right message at the right time. At its best, a stakeholder communication plan reduces confusion, prevents misalignment, and makes [decision-making](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/) faster. Without one, teams often fall into reactive communication: key stakeholders are updated too late, messages are inconsistent, and expectations drift out of sync. That matters because poor communication can affect more than project timelines. It can delay approvals, weaken trust, increase rework, and reduce return on investment. For finance teams especially, clear stakeholder communication helps [turn complex data into decisions](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/), alignment, and action. [How to create a revenue plan that doesn’t fall apart by Q3This blog will walk you through the main components of a revenue plan, what good revenue planning involves, when to start and how to put together a plan that gets results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-409.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--17.png)](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) ### **Stakeholder communication plan checklist** A comprehensive stakeholder communication plan includes more than a list of names and preferred channels. **The following checklist covers the essential components you'll need to build a plan that actually works in practice.** Copy this into your working document and fill in each item as you progress through the five-step process outlined below. ☐ **Stakeholder segmentation:** Categorize stakeholders by influence, interest, and [communication](https://www.financealliance.io/top-10-cfo-skills/) needs using your stakeholder map. ☐ **Objectives per group:** Define what you want each stakeholder segment to know, feel, or do as a result of your communications. ☐ **Key messages:** Draft core messages tailored to each group's priorities and concerns. ☐ **Channels and formats:** Specify the communication methods for each segment: email, meetings, dashboards, newsletters, or collaboration tools. ☐ **Cadence and timing:** Establish how often each group receives updates and align timing with project milestones or decision points. ☐ **Owner and RACI:** Assign clear responsibility for each communication task, including who is Responsible, Accountable, Consulted, and Informed. ☐ **Escalation path:** Document how issues or stakeholder concerns will be escalated and resolved. ☐ **Feedback loop:** Plan how you'll collect and incorporate stakeholder input: surveys, Q&A sessions, or informal check-ins. ☐ **Approval workflow:** Clarify who reviews and approves communications before they go out, especially for sensitive or executive-level messages. ☐ **Measurement KPIs:** Identify the metrics you'll track to assess communication effectiveness. As David Appel, a finance and metrics expert, notes, effective planning requires knowing "how to identify the metrics that are material to what tells your story, how you set your targets, and how you track progress together as an organization." ☐ **Review and update schedule:** Set a cadence for revisiting and refreshing the plan as stakeholder relationships or project needs evolve. In short, a stakeholder communication plan gives structure to stakeholder relationships. It helps you move from ad hoc updates to a repeatable process that supports project success and better business outcomes. As a finance professional, your role in developing and executing this plan is crucial for aligning stakeholder expectations with your company's [financial strategies](https://www.financealliance.io/saas-finance-strategies/) and performance, ensuring a cohesive path to success and sustainability. [The secret to effective communication with the C-suiteIf you’ve ever wondered how finance can evolve from gatekeeper to strategic partner, this article offers the blueprint. You’ll get real-world takeaways on building influence, navigating complex stakeholder dynamics, and driving value without losing your voice.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-175.png)Finance AllianceNick Quiroz![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/wayfair-1.png)](https://www.financealliance.io/how-wayfair-made-me-rethink-everything-i-knew-about-finance/) ## **Communication plan vs. engagement plan: what's the difference?** A stakeholder communication plan focuses on the structured flow of information: who receives what messages, through which channels, and how often. A stakeholder engagement plan goes further, emphasizing two-way dialogue, [relationship-building](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/), and active participation in decisions. Communication plans inform, engagement plans involve. **When do you need both?** High-change initiatives, complex transformations, or projects with significant stakeholder dependency typically require an engagement plan layered on top of your communication plan. If stakeholders need to contribute input, co-create solutions, or share accountability for outcomes, engagement planning becomes essential. For straightforward updates or compliance-driven communications, a well-structured communication plan often suffices. As Sarita Venkatesh, a finance leadership expert, explains, effective stakeholder relationships rest on "open dialogue, mutual respect, trust, shared goals and objectives, and willingness to collaborate." These elements describe engagement, not mere communication. When your project demands that stakeholders rely on each other's expertise, exchange constructive feedback, and hold each other accountable, you've moved beyond information-sharing into genuine engagement. In practice, many teams use both documents in tandem. The communication plan ensures consistent, timely information flow, while the engagement plan addresses the deeper work of trust-building and [collaborative](https://www.financealliance.io/5-steps-collaborative-budgeting-process/) decision-making. Think of engagement as the relational layer that sits beneath your communication cadence, shaping how stakeholders feel about the information they receive and their willingness to act on it. ![Communication plan vs. engagement plan: what's the difference?](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/Communication-plan-vs.-engagement-plan.png) ## **How to create a stakeholder communication plan in 5 steps** Having a solid stakeholder communication plan is a *must*, especially in the finance world. Skipping on a custom [strategy](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/)? That's a fast track to wasted time and effort. Plus, without clear communication and input from those who matter (t*hink employees, clients, investors, and partners*), your projects might just miss the mark, affecting both your [budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) and deadlines. The solution? Adopt a systematic approach to keep communication flowing both ways. This way, you're not just talking; you're building understanding and support. So, let's dive into creating a stakeholder communication plan that not only supports your [fundraising efforts](https://www.financealliance.io/acquisition-financing/) but also clarifies requirements and brings everyone on board with your vision. ### **1\. Identify your stakeholders (internal & external)** First, make a list of everyone who has a "stake" in your company. These are the people who you’ll communicate with, so think about anyone who has an interest in the project or who’ll be influenced by it. Your stakeholder list will include names to divide into two categories: internal stakeholders (such as employees and executives) and external stakeholders (including investors, customers, partners, and regulators). To help tailor your communication/messages to the stakeholders’ needs, try using a stakeholder map. This will let you visually organize stakeholders based on their level of interest in and influence over your projects or company. Here’s a basic example of what your stakeholder map might look like: ![Stakeholder communications map](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/Screenshot-2024-02-15-at-16.06.29.png) And here’s how you can make it work: **Create the stakeholder map:** Draw a grid with two axes: interest and influence. Interest on one axis measures how much stakeholders care about your project, while influence on the other axis gauges their power to affect it. **Position your stakeholders:** Place each stakeholder (or stakeholder group) on the grid according to their interest in and influence over your project. Doing this will help you clearly see who the key players are and who will need more engagement. **Strategize communication:** Use the insights from your stakeholder map to craft tailored communication strategies. Stakeholders with high interest and high influence need frequent and detailed updates, while those with less interest and influence might require only periodic summaries. Remember to add new stakeholders as/when they come into the scene. For this, you’ll need to come up with a process to help you keep the list updated. ### **How to tailor communication by stakeholder map quadrant (with examples)** Once you've positioned stakeholders on your interest-influence grid, the real work begins. Each quadrant demands a different communication approach, and getting this wrong can cost you time, credibility, or both. Here's how to think about each segment in practical terms. **High influence, high interest (manage closely)** These are your executive sponsors, board members, and key investors. They need frequent, detailed updates; think weekly or bi-weekly briefings with full context on risks, decisions pending, and financial implications. Your ask from this group is active input and timely approvals. Use direct channels like one-on-one meetings, executive dashboards, or concise email summaries with clear action items. A [CFO](https://www.financealliance.io/top-10-cfo-skills/) preparing for a major capital allocation decision, for instance, needs granular data and the opportunity to shape direction before final recommendations go to the board. **High influence, low interest (keep satisfied)** Regulators, senior leaders in adjacent departments, or external auditors often fall here. They have power but limited bandwidth for your project. Communicate less frequently (monthly or quarterly) but ensure every touchpoint is substantive and polished. Your ask is their continued support or non-interference. Avoid overwhelming them with detail; instead, provide executive summaries that highlight compliance, risk mitigation, and outcomes relevant to their priorities. **Low influence, high interest (keep informed)** Department leads, project team members, and engaged employees want to know what's happening. They may not control decisions, but their buy-in affects execution. Regular updates via newsletters, team meetings, or collaboration platforms work well here. Your ask is feedback and advocacy within their spheres. A finance transformation project, for example, benefits enormously when mid-level managers understand the rationale and can answer questions from their teams. **Low influence, low interest (monitor)** General employee populations or peripheral vendors typically sit here. Periodic, broad communications (quarterly all-hands updates or company-wide announcements) are sufficient. Your ask is minimal: awareness and compliance with any relevant changes. A common mistake is over-communicating to high-power, low-interest stakeholders, which can erode their patience and attention when you genuinely need it. Equally problematic is under-communicating risks to high-influence groups, leaving them blindsided when issues escalate. Calibrate your cadence and depth deliberately, and revisit your segmentation as stakeholder dynamics shift throughout a project's lifecycle. [Navigating your first 90 days as a CFO: What you need to know to succeed90 days can go by in a whirlwind, and without a clear framework, it becomes easy to chase competing priorities without building a foundation.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-410.png)Finance AllianceSimon Dealy![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--12-.png)](https://www.financealliance.io/your-first-90-days-as-cfo/) ### **2\. Clarify your objectives** Next, define exactly what you want to achieve through communication with each stakeholder group. Ask yourself, "What's the goal here?" It could be anything from rallying support for a new project to keeping everyone in the loop on financial performance. More focused objectives help to make sure your messages hit the mark. Try to be clear about what info you need to provide and what feedback would be useful to obtain. ### **3\. Select your communication methods** Not everyone likes their news the same way. Some prefer emails while others are all about quick meetings or updates via project management tools, etc. Pick the communication methods that work best for your stakeholders to keep everyone informed and engaged. The methods you choose might be based on preferences, demographics, goals, or resources. Some methods to consider include: - Regular progress reports - Email or online chat rooms - Presentations - Digital newsletters - Informal individual contacts - [Online communities](https://www.financealliance.io/community/) **4\. Create your stakeholder communication plan** Now that you have all your information, it’s time to pull it all together. Start by laying out a schedule on a calendar and identify how often updates need to happen (such as daily, weekly, monthly, quarterly, yearly, or on an ad-hoc basis). Assign clear responsibilities within your team for each communication task, ensuring everyone knows their specific duties. This includes who communicates what, to whom, and how often. Lastly, plan for feedback collection to gauge the effectiveness of your communications. This step is crucial for adjusting and improving your strategy over time. By streamlining this process, you create a focused and efficient approach to stakeholder communication, enhancing transparency and engagement with minimal fuss. [How to transform financial data into compelling storiesFP&A professionals have to understand the business deeply. We’re not just reporting results or explaining variances. We are taking on part of the decision-making burden.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-411.png)Finance AllianceLewis Danby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--5--8.png)](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) ### **5\. Monitor your communication plan (and assign a communication plan owner)** Your stakeholder communication plan isn’t a "set it and forget it" deal. You’ll need to pick someone to oversee monitoring channels for usage metrics, feedback incorporation, and updating of contacts or formats if needed. Have teams provide input on what is/isn't working. Review the plan itself annually for needed revisions as stakeholder relationships or business needs change. By following these steps, you're not just talking to your stakeholders; you're engaging them in a meaningful way that supports your company's goals and keeps everyone moving forward together. ## **How to measure if your stakeholder communication is working (metrics + review cadence)** Monitoring your stakeholder communication plan requires more than checking whether emails were sent. You need a measurement framework that connects communication activities to actual outcomes. A practical approach organizes metrics into **three buckets**: reach, engagement and understanding, and outcome impact. ### **Reach metrics** They tell you whether your messages are getting to the intended audience. Track open rates for emails and newsletters, attendance at meetings and [presentations](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/), and views on shared dashboards or collaboration platforms. These are leading indicators; they show whether your distribution is working, but they don't confirm comprehension or action. ### **Engagement and understanding metrics go deeper** Look at Q&A volume during briefings, survey responses measuring message clarity, and participation rates in feedback sessions. If stakeholders are asking relevant questions or demonstrating understanding in follow-up conversations, your communication is landing. Low engagement often signals a mismatch between your content and your audience's priorities. ### **Outcome impact metrics** These are the lagging indicators that matter most. These include decision cycle time for approvals (are steering committee sign-offs happening faster?), stakeholder satisfaction scores, and milestone achievement rates tied to stakeholder input. In finance contexts, you might track budget approval timelines, project [milestone](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) sign-offs, or the speed of executive decision-making. As David Appel, a finance and metrics expert, emphasizes, effective measurement means knowing "how to identify the metrics that are material to what tells your story, how you set your targets, and how you track progress together as an organization." Avoid vanity metrics; high open rates mean little if decisions stall or stakeholders remain confused. Establish a lightweight review rhythm to keep your plan responsive. A monthly communications health check lets you spot issues early, such as declining attendance, unanswered questions, or feedback gaps. A quarterly stakeholder pulse survey captures sentiment trends and emerging concerns. An annual plan refresh ensures your approach evolves with changing stakeholder relationships and business needs. This cadence keeps measurement practical rather than burdensome, and it ensures your plan remains a living system rather than a static document. [Multiple on Invested Capital (MOIC): Definition & guideIn this article, we’re zeroing in on MOIC to uncover what it is, its role in private equity, and more importantly, how you can use it to sharpen your investment evaluation skills.r![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-412.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--11-.png)](https://www.financealliance.io/multiple-on-invested-capital-moic/) ## **Stakeholder communication best practices** A communication plan only works if teams use it consistently. These best practices can help you avoid common mistakes and improve stakeholder engagement over time. ### **Common pitfalls to avoid** **Sending too much information** Not every stakeholder needs every update. Over-communication can make important messages easier to miss. **Using the same message for every audience** Executives, project teams, customers, and regulators all need different levels of detail. Tailor messages to their priorities. **Failing to update the plan** Stakeholder needs change across the project lifecycle. Review the plan regularly and update it after major milestones, risks, or scope changes. **Ignoring feedback** Communication shouldn't be one-way. If stakeholders raise concerns or ask repeated questions, refine the message or channel. ### **Practical tips for stronger communication** - Use plain language, especially when explaining financial or technical updates - Set recurring communications in advance so updates are predictable - Use templates for status reports, meeting agendas, and decision logs - Match the channel to the purpose: dashboards for visibility, meetings for decisions, surveys for feedback - Close feedback loops by showing stakeholders how their input influenced action ### **Tools that support stakeholder communication** The right communication tools can make planning, reporting, and follow-up much easier. - **Project management software**: Asana, Monday.com, Trello, or ProjectManager for task visibility and scheduled status reporting - **Dashboard and reporting tools**: Tableau, Power BI, or Looker for visualizing progress, KPIs, and financial performance - **Collaboration tools**: Slack or Microsoft Teams for quick updates and day-to-day coordination - **Survey and feedback tools**: SurveyMonkey, Typeform, or Microsoft Forms for structured stakeholder feedback Used well, these tools help [centralize communication, improve transparency, and reduce risk](https://www.financealliance.io/how-to-streamline-financial-consolidation-and-planning/) of missed updates. --- ## FAQs: Stakeholder communication plans How do you effectively engage with stakeholders? To engage with stakeholders, you must listen to their concerns, provide timely and relevant information, and involve them in decision-making processes. How do you write a stakeholder plan? You can make a stakeholder plan by identifying stakeholders, understanding their needs and interests, defining engagement goals, outlining engagement strategies, and establishing metrics for success. Why do we build relationships with stakeholders? It’s important to build relationships with stakeholders because it helps to ensure mutual understanding, support project goals, manage expectations, and foster collaboration and trust. How do you build relationships with stakeholders? Through consistent, open, and transparent communication, and by demonstrating reliability and trustworthiness in all interactions. What is the most important aspect of a relationship with a stakeholder? Trust is the cornerstone, as it underpins effective communication, collaboration, and the ability to navigate challenges together. --- ### **Become a Finance Alliance Insider** Level up your finance alliance career & network with finance alliance experts. Become an Insider and enjoy free access expert insights, community, courses, templates and more to boost your finance skills and career. No catches, no monthly bills – 100% free, *forever*. [Join now](https://www.financealliance.io/insider-membership-plan/) ### Acquisition financing: How it works and funding options (+ examples) URL: https://www.financealliance.io/acquisition-financing/ Last updated: 2026-03-11T13:09:30.000Z ## **What is acquisition financing?** Acquisition financing is the capital a buyer uses to purchase another business, a business division, or a set of business assets. In practice, it usually refers to a business acquisition loan or a mix of funding sources used to complete the transaction. **Key takeaways:** - Acquisition financing helps you buy a business without paying the full purchase price in cash - Common options include **SBA 7(a) loans**, conventional bank loans, seller financing, mezzanine financing, and equity - Buyers typically contribute **10% to 30%** of the purchase price as a down payment or equity injection - Loan terms often range from **seven to 10 years**, and longer terms may apply when real estate is part of the deal - Closing timelines usually fall between **30 and 90 days**, depending on the lender and deal complexity At a high level, acquisition financing works by using the target company's expected [cash flow](https://www.financealliance.io/3-cash-flow-forecasting-challenges/), assets, and overall deal structure to support repayment. A lender evaluates the buyer, the business being acquired, and the strength of the transaction before issuing an acquisition loan. Many deals use a layered capital structure rather than a single source of funding. For example, you might combine an SBA loan with a cash down payment and a seller note. This can reduce upfront cash requirements while [improving the overall financing package](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/). This matters because the right financing structure can make an acquisition more affordable, preserve working capital, and give your combined company enough flexibility to operate comfortably after closing. Done right, acquisition [financing fuels growth](https://www.financealliance.io/financial-crime-risk-management-fcrm/). Done poorly, [it can sink the whole ship](https://www.financealliance.io/risks-of-mergers-and-acquisitions/). [Cost-benefit analysis: 5 steps to turn data into smarter choicesIf you want to learn more about what cost-benefit analysis is and how to do it, keep reading as we dive into five key steps to streamline your financial evaluations and drive smarter decisions. 🧠![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-413.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--6--6.png)](https://www.financealliance.io/cost-benefit-analysis/) ## **How to secure acquisition financing: A step-by-step process** Securing acquisition financing is easier to manage when you break it into clear stages. Most buyers move through the same core process, from preparing financials to closing the loan. ### **Step 1: Prepare your financials and deal story** Start by assembling the documents lenders will expect to review. This usually includes: - Personal and business tax returns - Historical financial statements - Bank statements - A personal financial statement - Details on the target company's revenue, profit, and cash flow - A summary of how the acquisition will be financed and managed after closing This stage often takes **two to four weeks**, depending on how quickly information can be gathered. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-414.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-15.png)](https://www.financealliance.io/financial-charts-and-graphs/) ### **Step 2: Build the right financing mix** Most acquisitions are funded through more than one source. A common structure might include: - An **SBA 7(a) loan** or bank loan for the majority of the purchase price - A buyer cash contribution for the down payment - A seller note to bridge the remaining gap At this stage, you should also confirm whether you have [enough post-close working capital](https://www.financealliance.io/the-best-working-capital-strategies-for-fp-a/). A strong structure does more than get the deal approved—it also helps the business [operate smoothly after the transaction closes](https://www.financealliance.io/podcast/how-to-survive-a-post-merger-integration/). ### **Step 3: Submit applications and lender packages** Once the financing structure is clear, submit a complete package to one or more lenders. A typical acquisition financing package includes: - Signed LOI or purchase agreement - Historical and projected financials - Debt schedule - Business plan or acquisition thesis - Information on management experience - Details on collateral, if applicable This stage often takes **one to two weeks**, though strong preparation can shorten it. ### **Step 4: Move through underwriting** Underwriting is the point where lenders validate the strength of the deal. They'll often assess: - Credit score and personal liquidity - Industry or management experience - Debt service coverage ratio (DSCR) - Quality and stability of cash flow - Purchase price support, including valuation - Working capital needs after closing You should expect requests for follow-up documentation. Underwriting typically takes **four to eight weeks**, and delays often happen when financials are incomplete or deal assumptions are unclear. ### **Step 5: Close the transaction** After approval, the lender, attorneys, and seller finalize loan documents and closing requirements. You should budget for: - Lender fees - Legal fees - Valuation or quality of earnings reports - Filing fees and other transaction costs Closing usually takes **one to two weeks** once final approval is issued. In total, many acquisition loans close within **30 to 90 days**, depending on the lender, the program, and the complexity of the deal. ## **Types of acquisition financing** As CFO, you have a number of routes to consider when financing an acquisition. So, let's walk through some of the common options: ### **1\. Stock swap transaction** ![Stock swap image depiction](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/Screenshot-2024-02-13-at-11.51.22.png) Using company shares instead of cash to buy another business lets you expand *without* draining your cash reserves. It shows you've got faith in the new mega-company you're creating too. **Example:** Company A offers 0.5 shares of its stock for every share of Company B. If Company B has 1 million shares outstanding, Company A issues 500,000 new shares to complete the deal. No cash changes hands, and Company B's shareholders become part-owners of the combined entity. ### **2\. Equity acquisition** This involves the acquirer paying for the target company by issuing new shares of its own stock to the target's shareholders. It's similar to a stock swap but focuses on expanding the ownership base to include the shareholders of the acquired company. Taking this route dilutes the existing shareholders' stakes but avoids increasing the company's debt load. **Example:** A tech startup acquires a smaller competitor by issuing 200,000 new shares to the competitor's founders, giving them a 15% stake in the combined company. ### **3\. Acquisition through debt** Borrowing money is probably the most affordable way to buy another business. Banks will lend company acquisition money through loans, bonds, etc. Debt financing makes it possible to make large acquisitions *without* diluting shareholders' equity, but it increases the company's leverage and financial risk. **Example:** A manufacturing company secures a $10 million term loan from a regional bank to acquire a supplier, using the supplier's equipment as collateral. ### **4\. Leveraged Buyout (LBO)** Here, most of the money needed to acquire the target company comes from loans backed by the assets being acquired. LBOs are a high-risk, high-reward strategy, [often used by private equity firms](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/). **Example:** A private equity firm acquires a restaurant chain for $50 million, putting up $10 million in equity and borrowing $40 million against the chain's real estate and cash flows. ### **5\. Cash acquisition** A straightforward method where the acquiring company pays cash for the target company's shares. This is often preferred by the sellers because it provides immediate liquidity. For the buyer, it means using either available cash reserves or [raising new capital](https://www.financealliance.io/how-to-effectively-fundraise-and-find-investors/) specifically for the acquisition, potentially through issuing debt or equity. **Example:** A retailer uses $5 million from its cash reserves to buy a regional competitor outright. ### **6\. Seller’s financing / Vendor Take Back (VTB) Loan** In seller’s financing or VTB, the seller of the company extends a loan to the buyer to cover part of the purchase price. This can be beneficial in the case where the buyer is unable to secure sufficient financing from other sources. **Example:** You buy a local business for $1 million, paying $700,000 at closing and signing a note to pay the seller $300,000 over three years. ### **7\. Mezzanine financing** ![Mezzanine financing ](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/Funding-acquisition-2-1.png) Mezzanine financing is [a hybrid form of capital that combines](https://www.financealliance.io/10-structured-capital-strategies/) elements of debt and equity financing. It provides lenders the right to convert to an ownership or equity interest in the company if the loan is not paid back in time and in full. It’s often used to finance the expansion of existing companies and is subordinate to debt provided by senior lenders like banks. **Example:** A company raises $3 million in mezzanine debt to bridge the gap between its bank loan and the equity it can contribute, giving the mezzanine lender warrants to purchase shares if the loan isn't repaid. As Christopher Toumajian notes: "Even two deals that look almost identical compared to each other can have wildly different deal structures." The takeaway is that blended structures are common. Many acquisitions combine cash, equity, seller financing, and debt in creative ways to balance risk, preserve cash flow, and align incentives between buyer and seller. ## **Mezzanine financing and subordinated debt in the M&A capital stack** When senior lenders cap how much they'll provide and equity alone can't bridge the gap, mezzanine [financing](https://www.financealliance.io/5-startup-vc-funding-tips/) and subordinated debt step in to complete the capital stack. Understanding where these instruments sit (and why buyers use them) can make the difference between a deal that closes and one that falls apart. The key feature: mezzanine debt is subordinated, meaning it sits below senior debt in the repayment hierarchy. If the company runs into trouble, senior lenders get paid first. Mezzanine lenders wait in line. Subordinated debt, more broadly, refers to any debt that ranks below senior obligations. Mezzanine [financing](https://www.financealliance.io/10-structured-capital-strategies/) is one type, but subordinated notes and junior debt also fall into this category. What makes mezzanine distinct is that it often includes equity kickers; warrants or conversion rights that let the lender convert their debt into ownership shares under certain conditions. This sweetener compensates for the added risk of being lower in the capital stack. **Why do buyers use this layer? Three main reasons:** 1. It bridges funding gaps when senior lenders won't provide enough leverage. 2. It reduces equity dilution; you're borrowing more instead of giving up ownership. 3. It increases deal size, letting you pursue larger acquisitions than your equity and senior debt alone would support. **Here's how a typical M&A capital stack might look in practice.** Imagine a $100 million acquisition. The buyer contributes $30 million in equity. A senior lender provides $50 million in term debt secured by the target's assets. That leaves a $20 million gap. A mezzanine lender fills it with subordinated debt at 15% interest, plus warrants representing 3% of the company's equity. The intercreditor agreement between the senior and mezzanine lenders spells out who gets paid when, and under what circumstances the mezzanine lender can take action if payments are missed. The mechanics matter. Mezzanine debt typically has longer terms (five to seven years), often with interest-only payments in the early years and a balloon payment at maturity. Repayment priority is clear: senior debt first, then mezzanine, then equity holders. If you're structuring a deal with mezzanine financing, expect detailed negotiations around subordination terms, prepayment penalties, and the conditions under which warrants convert. [10 risks of mergers and acquisitions & how to mitigate themIn this article, we explore the top 10 risks of acquiring a company and how to mitigate them.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-415.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--1-.png)](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) ## **Debt vs equity financing: pros and cons when acquiring a business** Debt financing means borrowing money (through bank loans, bonds, or credit facilities) to fund an acquisition, while equity financing involves issuing new shares to raise capital or using stock as purchase consideration. The core tradeoff comes down to control versus financial risk: debt preserves ownership but adds repayment pressure, while equity dilutes existing shareholders but keeps your balance sheet lighter. So how do you decide which path fits your deal? Start with cash flow. If the target company generates strong, predictable cash flows, debt financing often makes sense because those revenues can service the loan payments. Lenders will look at coverage ratios and want confidence that the combined entity can handle the new obligations. On the other hand, if cash flows are uncertain or you're already carrying significant leverage, equity financing reduces the strain on your balance sheet and avoids covenant risk. As Christopher Toumajian, Vice President of Corporate Development at EP Wealth Advisors, explains: "How much cash, how much equity are we offering in our deals? What's the impact of that on our cash flow forecasting?" This consideration mix (the blend of cash and equity in your offer) shapes everything from deal structure to long-term capital planning. A practical decision framework: lean toward debt when the target has stable EBITDA, your existing leverage is manageable, and you want to preserve shareholder value. Lean toward equity when the deal size stretches your borrowing capacity, when market conditions make debt expensive, or when you want to align the seller's interests with long-term performance through stock consideration. Many deals, of course, blend both, and that flexibility often produces the most resilient capital structures. --- ## **FAQs: Acquisition financing** #### Can seller financing count toward my down payment? Usually, no. Most lenders still require you to contribute meaningful cash equity. Seller financing can strengthen your deal structure, but it typically won't fully replace your required down payment. #### What interest rates should I expect? Rates depend on the lender, your profile, and the deal structure. In general: - ****SBA 7(a) loans** often price at a spread above prime - Conventional bank loans may offer competitive pricing for strong borrowers - Alternative lenders tend to charge higher rates in exchange for speed or flexibility Your final rate will depend on credit, cash flow, collateral, industry risk, and down payment size. #### How much can I borrow for an acquisition? Borrowing capacity depends on the financing program and the business's ability to support debt. For example, ****SBA 7(a) loans** can fund up to ****$5 million**, while bank and non-bank options vary widely by lender and transaction profile. #### How long does acquisition financing take? Most acquisition loans close in ****30 to 90 days**. SBA and bank loans often take longer than alternative lending solutions because underwriting is more detailed and documentation requirements are heavier. #### What will lenders look for in my application? Lenders typically review: - Your credit profile - Your relevant business or industry experience - The target company's historical cash flow - Debt service coverage ratio (DSCR) - Available collateral - The reasonableness of the purchase price - Your post-close liquidity and working capital position #### Do I need collateral or a personal guarantee? Often, yes. Many acquisition lenders require a personal guarantee, and some also require available collateral. SBA and conventional lenders commonly take a lien on business assets, and some may look for additional collateral support depending on the transaction. --- ## **Become a Finance Alliance Pro member** Our Pro membership offers a unified source of trustworthy value for finance professionals to gain new knowledge. It's the all-in-one platform for finance professionals committed to lifelong learning, networking, and career advancement. - Pre-built financial models - Templates & frameworks - 100+ hours of OnDemand insights - FinIQ competency framework - Mentor program - Members-only networking & webinars - Ungated access to reports - Workshops & webinars - Discounts on events Secure your spot at the forefront of the finance industry with access to expert-driven tools and insights that promise to amplify your career trajectory. [Sign-up](https://www.financealliance.io/signup/) ### 16 of the best financial charts and graphs for data storytelling URL: https://www.financealliance.io/financial-charts-and-graphs/ Last updated: 2026-03-06T12:52:22.000Z Using visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with so many types of visuals available, it can be difficult to know which is the best fit for your needs. Below, we've compiled some of the most commonly used graphs and visuals in finance (*along with some financial visualization examples of each*) to help you select the right option.👇🏼 ## **1\. Bar chart** A bar chart **compares values across categories** using rectangular bars, where bar length or height represents the value. ![bar chart example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.55.54.png) **Common finance use cases:** - Comparing quarterly revenue by business unit or product category - Showing operating expenses by department or cost center - Visualizing budget vs. actual variance with grouped bars - Ranking [financial KPIs](https://www.financealliance.io/32-cfo-kpis/) like gross margin by region **Best practices for finance-ready bar charts:** - Sort bars (highest to lowest) when ranking matters - Use consistent color meaning; neutral for actuals, accent colors for variances - Label units clearly ($, %, basis points) and include data labels when precision counts - Keep categories manageable (10 or fewer) or group smaller ones into "Other" - Always use a zero baseline to avoid misleading comparisons **Common mistakes to avoid:** - Too many categories (makes insights disappear) - Truncated axes that exaggerate differences - Random colors without meaning - Mixing time trends with category comparisons **Best for:** Category comparisons, budget breakdowns, variance highlights, KPI rankings. **Avoid when:** You need to show trends over time; use a line chart instead. ## **2\. Line graph** A line graph plots values across time and connects points to show movement. For finance teams, it's the go-to format for **trend analysis** because it quickly shows direction, volatility, seasonality, and unusual spikes. ![Line graph example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.56.09.png) **Where line graphs work best in finance** - Tracking revenue, gross margin, EBITDA, or CAC over time - Monitoring daily/weekly cash balances and cash flow patterns - Showing budget variance trends across months or quarters - Visualizing market data and stock charts (price movement over time) **How to make time-series data readable** - Pick the right frequency: daily for trading/cash monitoring, monthly for management reporting, quarterly for board-level summaries - Use clear time anchors (month labels, quarter markers) so the reader can orient quickly - If you include projections, differentiate them (dotted line) and label assumptions - Avoid clutter: one to three lines is ideal; beyond that, use small multiples or split charts **When to use a line graph vs. other charts** - Use a **line graph** when you want the reader to understand change over time (trend direction and rate of change) - Use a **bar chart** when the focus is comparing discrete categories (departments, products) - Use an **area chart** when you want to emphasize magnitude (but be cautious: it can hide small changes) **Best for:** Visualizing [financial trends](https://www.financealliance.io/mastering-data-storytelling/), time-series data, seasonality, and stock price movement. Allows you to see increases, decreases, and anomalies over time. Great for illustrating trends and time-series data. ## **3\. Pie chart** A pie chart **divides data into proportional slices** of a circular "pie" to **represent percentages or proportions** of a whole. ![Pie chart example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.56.32.png) **Best for**: Pie charts are useful for depicting changes over time. They're also widely used to show the breakdown of a whole into parts, like revenue by region, expense categories, or [allocation of a budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). Helps see the size of components and their relationship to the whole. ## **4\. Scatter plot** A scatter plot positions data points on a graph based on **two variable scales**. It reveals **relationships** and **correlations** between the **variables**. ![Scatter plot example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.56.45.png) **Best for**: Comparing two financial metrics to see if they're correlated, like sales vs. marketing expenses. Allows you to identify patterns and trends between the variables. Best for displaying the relationship between two variables. ## **5\. Heat map** A heat map uses **color coding** to represent **values** and the **density of data points** in a table or matrix format. ![Heat map example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.56.52.png) **Best for:** Visualizing correlations between large datasets with many variables. Useful for finding patterns in financial data like factor correlations. Excellent for [visualizing data](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) density or concentrations. ## **6\. Area chart** An area chart displays quantitative data similarly to a line chart, but the area **below the line** is colored to represent **volume** or **magnitude**. ![Area chart example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.57.03.png) **Best for:** Highlighting trends and drawing attention to the overall magnitude of change over time. Can be useful for financial metrics like revenue and profit growth. ## **7\. Stacked bar chart** A stacked bar chart **segments** the bars into **colored sections** to show how different components make up a whole. ![Stacked bar chart example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.57.16.png) **Best for:** Breaking down financial data across multiple sub-categories like revenue by product, region and showing the composition of the total. Effective for showing the composition of categories or the distribution of data across multiple groups. ## **8\. Bubble chart** A bubble chart displays data points as **circles** with varying sizes based on a **third variable**. Often used along x and y axes. ![Bubble chart example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.57.29.png) **Best for:** Simultaneously visualizing three variables, like market size, growth rate and investment amount when analyzing expansion opportunities. Ideal for representing three or more variables simultaneously, while showing the relationship and differences between them. ## **9\. Waterfall chart** A waterfall chart shows how **positive and negative values** contribute to a final total through **cascading levels**. ![Waterfall chart example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.57.40.png) **Best for:** Understanding the incremental buildup or breakdown of a financial metric like analyzing sources of net income changes from one period to the next. Excellent for visualizing the cumulative effect of sequentially introduced positive or negative values, typically used for understanding the incremental contribution of different factors to a final value. ## **10\. Box and whisker plot** This chart plots **statistical distributions** by showing the **median**, **quartiles**, **extremes** and **outliers** of the dataset. ![Box and whisker chart example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.57.48.png) **Best for:** Understanding the distribution, spread and skew of financial data like revenue per customer. Allows you to see central tendencies and anomalies. Ideal for displaying the distribution of data, highlighting outliers, and showcasing the central tendency and dispersion of a dataset. ## **11\. Radar chart** A radar chart has **multiple axes** projecting from a center point to display data for multiple variables. Also called a **spider chart**. ![Radar chart example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.58.06.png) **Best for:** Comparing multiple metrics like financial KPIs across business units or departments to see performance patterns and profiles. Useful for comparing multiple quantitative variables, showcasing the performance or profile of different entities across various attributes. ![Quote from Soufyan Hamid](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.58.18.png) Source: [**Storytelling with Data Visualization Playbook*](https://www.financealliance.io/storytelling-with-data-visualization/) ## **A few more advanced financial charts and graphs to consider** Now, we’re going to look at some slightly more advanced [techniques for data visualization](https://www.financealliance.io/8-key-principles-of-data-visualization-in-finance/), including the use of a financial planning graph. These techniques help reveal hidden patterns, trends, and relationships in the data, making it easier to make data-driven decisions. They’re best suited for individuals with a strong understanding of [data analysis](https://www.financealliance.io/microsoft-fabric-for-data-analysis/) and visual design principles. Below, we explore some of these advanced graphs and charts: ### **12\. Treemaps** Treemaps are a space-filling visualization technique that uses nested rectangles to represent hierarchical data. They’re useful for displaying financial data with multiple levels, such as the breakdown of a company’s revenue by product category and subcategory. The difficulty in creating treemaps involves selecting appropriate nesting and color-coding schemes to ensure clarity. ![Treemaps example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.58.58.png) **When to use** - Revenue breakdown by division → product category → SKU - Spend analysis by department → vendor → cost type - Portfolio exposure by sector → industry → holding **Watch outs** - Poor hierarchy choices create confusing blocks - Too many tiny rectangles become unreadable—aggregate small items into "Other" ### **13\. Sankey diagrams** Sankey diagrams are flow diagrams that show the flow of data or resources between nodes, using the thickness of the connecting lines to represent the flow’s magnitude. They’re useful for visualizing financial flows, such as the movement of funds between accounts or the distribution of investments in a portfolio. The challenge in creating Sankey diagrams comes from managing the layout and line thicknesses to accurately represent the data. ![Sankey diagram example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.59.15.png) **When to use** - Cash flow or funds flow (sources → uses) - Cost allocation pathways across teams or products - Customer revenue flow across channels or segments **Watch outs** - Too many nodes makes it spaghetti—limit to key pathways - Requires clean "from → to → value" structured data ### **14\. Choropleth maps** Choropleth maps use color gradients to represent data values across geographical regions, such as countries or states. They’re ideal for visualizing regional financial data like GDP growth, poverty rates, or market penetration. The difficulty in creating choropleth maps lies in selecting the right color scheme and ensuring the data is accurately represented geographically. ![Choropleth maps example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.59.27.png) **When to use** - Regional sales performance and growth - Market penetration or customer concentration by territory - Credit risk or delinquency rates by region **Watch outs** - Absolute values can mislead on maps—consider normalizing (per capita, per store) - Choose color scales that remain readable for color-vision deficiencies ### **15\. Network graphs** Network graphs display relationships between entities through nodes and edges. They’re ideal for visualizing connections in large datasets, such as relationships between companies, investors, or assets. The difficulty in creating network graphs comes from dealing with large amounts of data and ensuring the visualization remains readable. ![Network graph example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.59.39.png) **When to use** - Comparing financial ratios across companies (margin, leverage, liquidity, growth) - Screening investments using multiple criteria at once - Multi-KPI performance analysis across business units **Watch outs** - High clutter with many entities; use filtering, highlighting, and sampling - Requires careful axis ordering to avoid misleading patterns ### **16\. Parallel coordinates** ![Parallel coordinates example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-14.59.46.png) Parallel coordinates plot multivariate data on parallel axes, which allows for the comparison of multiple dimensions simultaneously. This technique is useful for visualizing relationships between different financial variables or analyzing the performance of multiple assets. The challenge lies in managing axis spacing, scaling, and labeling, while maintaining readability. [10 risks of mergers and acquisitions & how to mitigate themIn this article, we explore the top 10 risks of acquiring a company and how to mitigate them.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/FA_Framework_Tiles_2_due_diligence.jpg)](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) ## **How to choose the right finance chart or graph for your needs** Ever stared at a spreadsheet full of financial data and wondered how to turn it into something clear and impactful? I think we've all been there. Thankfully, there are some best practices you can follow to help you pick the perfect option for your needs. ### **Step 1: Know your goal** You need to understand what you want the chart or graph to convey to your audience. Are you highlighting trends over time, like stock prices or monthly sales? Line and area charts are great for that. They'll showcase the journey of your data and accurately visualize the direction and magnitude of changes. Need to compare different categories, like expenses or budget allocations? Bar charts are your go-to. They'll let you see side-by-side how things measure up. ### **Step 2: Keep it simple** Think about your audience. If they're new to financial charts, stick to the classics: line, bar, and pie. These are universally understood and will get your message across. For example, classic charts like bar charts are universally understood and can convey your message perfectly. It's also important to avoid overcomplicating things. Simple charts with clear labels and well-defined colors ensure your data is accessible to everyone. ### **Step 3: Complexity matters** If you're dealing with a lot of data or want to show relationships between variables, you might need a more specialized chart like a scatter plot. If you want to branch into more advanced options, you could try a heatmap, which is great for showing the intensity of data points within a dataset, such as expense concentrations across different categories and periods. But for most everyday financial needs, the basic options will do just fine. ### **Step 4: Match the charts to your audience/setting** **Executive updates** - Prefer simple standards: bar, line, waterfall - One message per chart. Label the takeaway directly on the visual **Finance/analyst audiences** - More tolerance for density: scatter plots, heat maps, advanced charts - Include definitions (e.g., "gross margin %") and methodology notes where needed **External/public reporting** - Prioritize accessibility (colorblind-safe palettes, clear captions, sources) - Avoid niche chart types unless you can explain them quickly 💡 ****Bonus Tip:** Focus on clarity. No matter what chart you choose, make sure it's easy to read. Clear labels, well-defined colors, and a focus on the key message will ensure your financial data shines. ## **A quick data prep checklist (before you build the chart)** - Confirm units ($, %, bps) and time period definitions (MTD/QTD/YTD) - Use consistent time intervals (don't mix weekly and monthly without explanation) - Normalize where needed (per customer, per store, per capita) to avoid misleading comparisons - Handle missing data explicitly (gap, interpolation, or "N/A") - Use consistent category naming (avoid duplicates like "Ops" vs "Operations") --- ### **FAQs: Financial charts and graphs** How do you decide which graph to use? The choice of graph depends on the data type, the information you want to convey, and the audience's familiarity with the chart type. It's essential to choose a graph that best represents the data's story. What are the different types of financial charts? Common financial charts include line charts, bar/column charts, pie charts, waterfall charts, scatter plots, candlestick charts (for stock prices), and area charts, among others. What is the best chart for financials? There's no one-size-fits-all answer. The best chart for financials depends on the specific data and the intended message. For stock price movements, candlestick charts are popular, while for budgeting, bar or column charts might be preferred. Why are graphs important in finance? Graphs provide a clear, visual way to quickly grasp complex financial data, uncover insights, and facilitate decision-making. They help in identifying patterns, trends, and anomalies that might be missed in tabular data. What is the best graph to show money? Bar charts are ideal for showing money amounts, such as revenue, expenses, or profits, across different categories. They provide a clear comparison and are easy to read. What chart is best for budgeting? Pie charts are effective for showing budget allocations. They visually represent how the budget is divided among different categories, making it easy to see proportions. What is the best chart to show year-over-year growth? Line charts are great for illustrating year-over-year growth. They show trends over multiple years, making it easy to identify patterns and growth rates. Which chart is most ideal for showing trends over time? Line charts are the most suitable for showing trends over time. They clearly demonstrate changes and trends over a continuous period, whether it’s months, quarters, or years. --- ## **Take our Business Partnering & Storytelling: Certified course** Unlock the power of storytelling and transform your role in finance with our [**Business Partnering & Storytelling**](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) course. Learn how to make data speak and influence strategic decisions that matter. This course gives you immediate access to five hours of dynamic video content, presentation slides, and hands-on resources. You’ll get practical insights from **Christian Wattig**, FP&A expert, on how to deliver impactful business insights and foster meaningful relationships that drive organizational success. Enhance your communication and business partnering skills today. **Sign up and start your journey now!** [Sign up](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) ### CFO Summit San Jose | February 2026, OnDemand URL: https://www.financealliance.io/cfo-summit-san-jose-february-2026-ondemand-2/ Last updated: 2026-03-05T19:05:56.000Z Catch up on all sessions from CFO Summit San Jose with insights from Lyft, Hitachi, Freshworks, and more. _This post is for paying subscribers only._ ### Cost-benefit analysis: 5 steps to turn data into smarter choices URL: https://www.financealliance.io/cost-benefit-analysis/ Last updated: 2026-03-05T10:34:56.000Z Not sure where to start with cost-benefit analysis (CBA)? We hear you. With so many complex factors to identify and monetize, it can be hard to know which costs and benefits to focus on first, or how to accurately quantify them. ![](https://media.tenor.com/q0Cj0U0_4-0AAAAC/genius-smart.gif) If you want to learn more about what cost-benefit analysis is and how to do it, **keep reading as we dive into five key steps** to streamline your financial evaluations and drive smarter decisions. ## **What is meant by cost-benefit analysis?** Cost-benefit analysis attempts to lay out an objective framework for any major spending or [investment](https://www.financealliance.io/multiple-on-invested-capital-moic/) choice by asking two vital questions: 1\. Do the expected benefits outweigh the expected costs over time? 2\. And if so, by how much relative to other alternatives? It provides the needed structure for breaking down decisions into defined costs and benefits that can be systematically assessed. ![Cost-benefit analysis definition](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/02/Copy-of-FA_Testimonial_Template_--1--2.png) ## **What is the main goal of using a cost-benefit analysis?** 🎯 The main goal of doing a cost-benefit analysis is to determine whether the benefits of a potential project or decision outweigh the costs. Put simply, it answers the question: *is this project or task worth it?* To get that answer, you've got to weigh all the possible outcomes, which involves lining up the good, the bad, and everything in between. And yes, that means you need to sift through the options and choose the one that brings the most value *without* weighing you down with excessive costs. [Scenario planning: Navigate uncertainty with confidenceLearn about the key benefits of scenario planning and how it can be integrated into strategic and financial planning cycles.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-72.png)Finance AllianceCesar Gomez Nieto![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--1.png)](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/) ## **Pros and cons of cost-benefit analysis (and when to use it)** Cost-benefit analysis offers a structured approach to decision-making, but it carries limitations that deserve honest acknowledgment. Understanding both sides helps you apply the method where it adds value and recognize when alternative approaches may serve you better. ### **Advantages** CBA creates a common framework for comparing options that might otherwise seem incommensurable. By translating diverse factors into monetary terms, it enables apples-to-apples comparisons across projects, departments, or strategic initiatives. This comparability supports prioritization when resources are limited. The process itself imposes discipline. Listing costs and benefits forces teams to surface assumptions, identify data gaps, and confront trade-offs that might otherwise remain implicit. Transparency improves when stakeholders can see the reasoning behind a recommendation rather than accepting conclusions on faith. CBA also facilitates alignment. When [finance](https://www.financealliance.io/17-finance-business-processes/), operations, and strategy teams work from the same analysis, disagreements shift from competing intuitions to specific assumptions that can be tested and debated. This shared foundation often accelerates decision-making and reduces post-decision second-guessing. ### **Disadvantages** Intangible valuation introduces uncertainty that the final numbers may obscure. Assigning a dollar figure to brand reputation or employee morale requires assumptions that reasonable people can dispute. As David Magnan, a healthcare data analytics expert, observes about hidden inefficiencies: "Twenty to thirty percent of the transactions executed in health care are unnecessary, and you're paying for them." This insight highlights how bias and misaligned incentives can distort the data feeding any analysis. Double-counting poses a persistent risk. A benefit captured in one line item (say, productivity gains) may reappear indirectly in another, inflating the total. Careful [documentation](https://www.financealliance.io/business-process-optimization/) and cross-checking help, but the risk never disappears entirely. CBA can also create false precision. A net benefit figure of $127,432 suggests accuracy that the underlying estimates may not support. Sensitivity analysis mitigates this concern, but readers must remember that outputs are only as reliable as inputs. Finally, CBA demands time and effort. For small decisions or situations where speed matters more than precision, a lighter-weight approach may be more appropriate. [Lessons on building robust planning, budgeting, and forecasting processesEvery element (foundation, philosophy, rituals, and artefacts) should serve the needs of stakeholders, particularly shareholders.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-399.png)Finance AllianceNoufal Basheer![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-1.jpg)](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/) ### **When to use CBA and when to consider alternatives** CBA works best for decisions with measurable financial consequences, multiple alternatives, and [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) who need transparent justification. It suits capital investments, process changes, and strategic initiatives where trade-offs can be quantified. Consider alternatives when outcomes resist monetization (ethical decisions, compliance requirements), when speed outweighs precision, or when distributional impacts matter more than aggregate net benefit. In those cases, multi-criteria analysis, [scenario planning](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/), or stakeholder deliberation may complement or replace CBA. To mitigate common downsides, maintain an assumption log, run sensitivity tests on key variables, and invite stakeholder review before finalizing recommendations. These practices keep the analysis credible without pretending to certainty it cannot deliver. ## **Key components of a cost-benefit analysis (what to include)** A complete cost-benefit analysis contains several interconnected components that move from framing the decision to delivering a recommendation. Understanding these components helps you build an analysis that stakeholders can follow, challenge, and ultimately trust. ### **Decision objective** State the question you are trying to answer. Are you evaluating whether to proceed with a single project, or comparing multiple alternatives? Clarity here prevents scope creep and keeps the analysis focused. [What does a finance director do? | Career guideIn this career guide, we take you through all the major pillars of this role from key responsibilities to skills, qualifications, salary, and more.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-402.png)Finance AllianceChristopher Reed![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--13--2.png)](https://www.financealliance.io/what-does-a-finance-director-do/) ### **Alternatives under consideration** List the options you will compare, including the status quo or "do nothing" baseline. Every alternative should be mutually exclusive and collectively exhaustive within the decision context. ### **Time horizon** Define the period over which you will measure costs and benefits. A three-year horizon suits many operational decisions, while infrastructure investments may require ten years or more. The horizon should reflect when meaningful costs and benefits occur. ### **Assumptions and data sources** Document where your numbers come from and what you assume about future conditions. As David Magnan notes about cost visibility: "As finance people, one of the key things to managing any cost is to know what it is." Reliable unit-cost data and transparent assumptions form the foundation of credible analysis. [How to transform financial data into compelling storiesFP&A professionals have to understand the business deeply. We’re not just reporting results or explaining variances. We are taking on part of the decision-making burden.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-403.png)Finance AllianceLewis Danby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--5--7.png)](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) ### **Cost categories** Include direct costs (materials, labor, equipment), indirect costs (overhead, maintenance, depreciation), intangible costs (reputational risk, morale impact), and opportunity costs (value of foregone alternatives). Each category should have a clear measurement approach. ### **Benefit categories** Capture tangible benefits (revenue gains, cost savings, productivity improvements) and intangible benefits (customer satisfaction, employee retention, brand value). Where possible, link intangibles to measurable proxies. ### **Decision metrics** Calculate net benefit (total benefits minus total costs) and the benefit-cost ratio (total benefits divided by total costs). These metrics appear in Step 4 of the process and form the quantitative basis for your recommendation. ### **Risk testing and sensitivity analysis** Identify the assumptions most likely to change and test how variations affect your results. This step, covered in Step 4, reveals which estimates matter most and how robust your conclusions are. Think of these components as falling into two groups: inputs (assumptions, forecasts, data sources) and outputs (net benefit, BCR, recommendation). The inputs feed the calculations; the outputs inform the decision. A junior analyst can use this checklist to ensure nothing critical is missing before presenting findings to leadership. [How to create a revenue plan that doesn’t fall apart by Q3This blog will walk you through the main components of a revenue plan, what good revenue planning involves, when to start and how to put together a plan that gets results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-404.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--16.png)](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) ## **How do you calculate cost and benefit analysis?** A cost-benefit analysis balances the cost of an action against its potential benefits, providing a clear financial comparison to guide decision-making. To calculate cost and benefit analysis, there are several steps you must follow (see below). However, in terms of [metrics](https://www.financealliance.io/infographic-financial-performance-metrics/), the most critical aspect is accurately quantifying and then comparing the total costs against the total benefits. Here’s how you can do it (*we'll get into the steps of the cost-benefit analysis process in more detail in the next section*): 1. **Quantify costs**: First, list all the costs associated with the project or decision and assign a monetary value to each one. 2. **Quantify benefits**: Similarly, identify all potential benefits (both tangible and intangible). Again, assign a monetary value to each benefit. 3. **Total the costs and benefits**: Add up all the quantified costs to get a total cost figure. Do the same for the benefits to get a total benefits figure. 4. **Calculate net benefits**: Subtract the total costs from the total benefits. This calculation will give you the net benefit (or net cost, if the costs exceed the benefits) of the project or decision. ![cost benefit analysis example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/02/Copy-of-FA_Testimonial_Template_--2--2.png) 1. **Additional analysis**: To deepen the analysis, you might consider [metrics](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) like the benefit-cost ratio (BCR). To calculate this, you must divide the total benefits of a project by its total costs. The formula looks something like this: > **BCR = Total Benefits / Total Costs** ### **BCR worked example (with interpretation)** The BCR expresses the relationship between what you gain and what you spend in a single, comparable figure. It answers a straightforward question: for every dollar of cost, how many dollars of benefit do you receive? A BCR of 1.5 means each dollar invested returns $1.50 in benefits, leaving you with a net gain of fifty cents per dollar. The formula itself is simple: BCR equals Total Benefits divided by Total Costs. Both figures must share the same time horizon and scope. If your benefits span five years, your costs should too. If you discount future cash flows to present value for benefits, apply the same discount rate to costs. Consistency here prevents misleading comparisons. Consider a practical example. A company evaluates a process automation project with the following estimates: - **Total costs** (implementation, training, maintenance over 3 years): $100,000 - **Total benefits** (labor savings, error reduction, faster cycle times over 3 years): $150,000 - **Net benefit**: $50,000 - **BCR**: 1.5 [How to turn forecasting & budgeting mistakes into successesExplore key lessons in implementation processes and corporate strategy, and how you can use them to achieve real, tangible results in your FP&A function.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-405.png)Finance AllianceJames Manning![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--9--4.png)](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) **Interpreting this result involves three decision rules.** A BCR greater than 1.0 indicates benefits exceed costs, making the project financially viable on its own terms. A BCR equal to 1.0 means you break even; neither gaining nor losing. A BCR below 1.0 signals that costs outweigh benefits, suggesting reconsideration or redesign. When comparing multiple options, BCR helps you rank them by efficiency. A project with a BCR of 2.0 delivers more benefit per dollar than one with a BCR of 1.3, assuming similar risk profiles and [strategic alignment](https://www.financealliance.io/6-steps-to-transform-fp-a-into-a-platform-for-strategic-alignment/). This ranking function makes BCR especially useful when capital is constrained and you must choose among competing proposals. A few caveats deserve attention. BCR does not reveal absolute dollar amounts; a project with a BCR of 3.0 and $30,000 in net benefit may matter less than one with a BCR of 1.2 and $500,000 in net benefit. The ratio is also sensitive to assumptions; small changes in cost or benefit estimates can shift the BCR meaningfully, so sensitivity analysis remains important. Finally, avoid double-counting benefits that already appear in another metric or line item. For projects with significant timing differences in cash flows (where benefits arrive late or costs cluster early) Net Present Value (NPV) often provides a more nuanced picture than BCR alone. NPV accounts for the time value of money explicitly, making it a useful complement when multi-year timing matters. ### **So, what is a good cost-benefit ratio?** A BCR greater than **1.0** indicates that the project's benefits exceed its costs, suggesting it's a financially viable option. On the other hand, a BCR less than **1.0** means the costs outweigh the benefits, signaling a potential reconsideration of the project. ## **5 steps of the cost-benefit analysis process** ### **Quick-start checklist: What you need before you begin** Before diving into the five steps, gather the inputs and assign the responsibilities that will keep your analysis on track. This checklist mirrors the process ahead and ensures you have a concrete deliverable at each stage. **1\. Scope statement** Define the decision you are evaluating, the alternatives under consideration, and the time horizon for costs and benefits. Assign ownership to a project manager or [finance lead](https://www.financealliance.io/3-principles-to-lead-with-confidence-through-change/) who will maintain the analysis document. Required inputs include strategic objectives, stakeholder priorities, and any constraints (budget caps, regulatory requirements, or timeline limits). **2\. Cost and benefit inventory** List every cost and benefit category relevant to each alternative. Assign department heads or subject matter experts to contribute line items from their areas; operations for labor and materials, marketing for customer acquisition costs, HR for turnover-related expenses. Required inputs include historical spending data, vendor quotes, and revenue [forecasts](https://www.financealliance.io/how-to-forecast-inventories/). **3\. Assumption log** Document the sources, methods, and confidence levels behind each monetary estimate. This log becomes your audit trail and sensitivity testing reference. Assign a finance analyst to maintain version control and flag estimates that rely on weak data. **4\. Summary comparison table** Calculate net benefit and BCR for each alternative. Present the results in a side-by-side table that includes total costs, total benefits, net benefit, and BCR. Assign the finance lead to validate calculations and ensure consistency across alternatives. **5\. Recommendation memo.** Synthesize the quantitative findings with qualitative considerations (strategic fit, risk factors, stakeholder impact) into a one-page recommendation. Assign the project sponsor to review and approve before presenting to decision-makers. [10 tips to eliminate forecast biasNo matter how sophisticated our models get, forecast bias has a sneaky way of slipping into our financial plans. If you want to stop forecast bias from creeping in, here are 10 practical ways to put an end to it.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-406.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--5--3.png)](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) **What your final output should look like** A complete cost-benefit analysis package includes the scope statement, the cost and benefit inventory with supporting data, the assumption log, the summary comparison table, and the recommendation memo. Each document should reference the others so reviewers can trace any figure back to its source. The package should answer three questions clearly: Which alternative delivers the highest net benefit? How confident are we in the estimates? What non-financial factors should influence the final decision? When these elements come together, you have a decision-ready analysis that stakeholders can trust and act upon. --- Not every approach to cost-benefit analysis will be the same. But there tends to be five vital steps (or variations of these steps) that most will follow when carrying out the analysis. **These steps are:** ![Steps of cost-benefit analysis](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/01/Cost-analysis-steps.png) Now, let’s explore each step in more detail: ### **1\. Establish the framework for analysis** Kick things off by setting clear objectives and defining the scope of your analysis. This sets the stage for everything that follows, ensuring you're working within a structured and focused context. Most of the [planning](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) takes place during this stage and there’s some questions you need answers to, such as: **What’s the purpose of the cost-benefit analysis?** For example, is it to help determine whether your company should move forward with a new software development project? Or perhaps you want to assess the feasibility of the company's expansion into a new market, weighing the potential increase in customer base and revenue against the marketing and operational setup costs. Whatever the case, zone in on the main purpose of the cost-benefit analysis to help maintain focus throughout the process. **What's the timeline?** Your timeline is important. A short-term cost-benefit analysis could involve assessing the financial impact of running a promotional campaign over the course of three months, while a long-term analysis might look at the benefits and costs of a major infrastructure project planned to unfold over the next 10 years. Decide on your timeline as early in the process as possible. It's important to set both your goals and objectives at this stage too. Having a clear goal in mind will help during the next step. You’ll also need to choose how you’ll measure and compare costs and benefits and what metric you’ll use. ### **2\. Identify all relevant costs and benefits** Now, list out all the potential costs; think materials, labor, time, and benefits, like increased revenue, efficiency gains, or intangible perks. This step is crucial; missing something here can skew your entire analysis. And while you’re busy listing out all of those potential costs, don’t forget to consider the benefits too. These could be tangible, like increased revenue and efficiency gains, or intangible, like enhanced brand reputation or employee satisfaction. Costs (and benefits) typically include: **Direct costs:** - Materials and supplies needed for a project. - Labor costs, including salaries, wages, and benefits for employees directly involved. - Equipment costs, whether it's purchasing or leasing necessary machinery. **Possible benefits:** - Increased revenue from sales growth, new customers, or market expansion. - Enhanced productivity, leading to more output with the same or fewer inputs. **Indirect costs:** - Overhead expenses like utilities, rent for facilities, and administrative staff salaries. - Maintenance and operational costs that keep the project running. - Depreciation of equipment and technology used in the project. **Possible benefits:** - Long-term savings from improved processes or technology upgrades. - Boosted brand value and stronger market positioning that can lead to indirect revenue growth. [Why “operational debt” costs your finance function $100k+ per leaderThe businesses that scale successfully aren’t led by CFOs who take pride in doing everything themselves.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-407.png)Finance AllianceFilip Pesek![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--17--3.png)](https://www.financealliance.io/why-operational-debt-costs-your-finance-100k-per-leader/) **Intangible costs:** - Negative impact on brand reputation or employee morale. - Potential loss of customer loyalty or market share. **Possible benefits:** - Customer satisfaction that could translate into loyalty and word-of-mouth marketing. - Improved employee well-being and job satisfaction, potentially leading to higher retention rates. **Opportunity costs:** - Potential revenue lost by choosing one project over another. - The value of alternative uses of time and resources that are diverted from other activities. **Possible benefits:** - The project selected may offer a strategic advantage. - Allocating time and resources to the chosen initiative could streamline operations or improve product quality. - The decision might open up avenues for partnerships, collaborations, or even acquisitions. [Data storytelling for FP&AWhat do Barack Obama, Oprah Winfrey, and Nikki Glaser have in common? They all excel in storytelling...and you can do (yes, even as a finance professional!). Here’s how…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-73.png)Finance AllianceMathew Reynders![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--37--2.png)](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/) ### **3\. Quantify costs and benefits** Assign a monetary value to each [cost](https://www.financealliance.io/5-cost-reduction-strategies/) and benefit you've listed. This might require some digging into market rates, historical data, or expert forecasts, but it's worth the effort to get the most accurate picture possible. By quantifying the financial elements of your cost-benefit analysis, you'll lay the groundwork for making decisions that are both financially sound *and* strategically smart. Remember, [consistency](https://www.financealliance.io/business-process-optimization/) is key when you're crunching the numbers; make sure you're using the same currency and time frame across *all* elements for a coherent analysis. **How to quantify intangible costs and benefits (practical methods)** Intangible costs and benefits often carry significant weight in decision-making, yet they resist easy measurement. Brand reputation, employee morale, customer satisfaction, and risk reduction all influence outcomes in ways that matter deeply to stakeholders. The challenge lies in translating these factors into defensible monetary estimates without overstating precision or burying important considerations under arbitrary numbers. Several practical valuation techniques can help you move from vague acknowledgment to structured estimation. The avoided cost method asks what expenses you would incur if the intangible benefit disappeared; for example, calculating the recruitment and training costs you sidestep when employee retention improves. The replacement cost approach estimates what it would take to recreate a lost asset, such as rebuilding brand awareness through paid campaigns after reputational damage. Willingness-to-pay surveys gauge how much customers or stakeholders would spend to obtain a benefit, while productivity and time value methods convert efficiency gains into labor cost equivalents. Risk-weighted expected value multiplies the probability of an adverse event by its financial impact, giving you a dollar figure for risk reduction. Proxy metrics tie intangibles to measurable outcomes, linking customer satisfaction scores to retention rates, then to lifetime customer value. As David Magnan observes about employee engagement and cost visibility: "If I could see who's charging what, my co pay would be lower... There's more things you can do if you saw what was going on." This insight applies broadly; transparency around intangible drivers enables behavioral changes and incentives that translate into measurable savings. A few guardrails keep your estimates credible. Document every assumption so reviewers can challenge or adjust them. Avoid double counting by ensuring an intangible benefit captured in one line item does not reappear elsewhere. Align time horizons so that a five-year brand benefit is not compared against a one-year cost. And separate quantified impacts from qualitative ones in your summary table. Consider a worked example: reduced employee turnover. If your annual turnover rate drops from 15% to 10% on a 200-person team, you retain 10 additional employees per year. If each departure costs $12,000 in recruiting, onboarding, and lost productivity, the annual benefit equals $120,000\. That figure can sit alongside your tangible benefits with a clear assumption log attached. Some intangibles resist monetization entirely. When that happens, keep them qualitative but visible. Include a narrative section in your final recommendation that explains how these factors influenced the decision, even if they do not appear in the net benefit calculation. Stakeholders appreciate transparency about what the numbers capture and what they do not. ### **4\. Calculate net benefits and compare alternatives** It's time to do the math. ![](https://media.tenor.com/bxeM9N2IXLsAAAAC/osita-osita-iheme.gif) Subtract the total costs from the total benefits to find the net benefit of each option. This comparison is the heart of your analysis—it shows you which choices give you the *most* financial upside. But remember, it's not just about the final figure. Take the time to understand the [story *behind* the numbers](https://www.financealliance.io/storytelling-with-data-visualization-playbook/). Which option has the highest net benefit? Does it align with your strategic goals? Are there any non-financial factors that might influence your choice? **Here's a tip:** When comparing alternatives, consider using a [sensitivity analysis](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/). This will help you see how changes in key assumptions affect your net benefit. For example, what if material costs rise by 10% or the projected revenue falls short? By testing these scenarios, you'll get a sense of how robust your findings are and whether one option might be safer than another in the face of uncertainty. ### **5\. Make recommendations based on findings** Armed with your calculations, you can now recommend the most financially sound option. Your findings should support a clear path forward, providing a compelling case for why your chosen alternative stands out among the rest. Keep in mind that a cost-benefit analysis balances the cost of an action against its potential benefits. This balance is crucial in guiding your recommendations. As you make your recommendations, be transparent about your assumptions and the potential risks involved. Highlight how the benefits of your chosen option outweigh the costs, not just in monetary ways but also in terms of meeting strategic objectives or other non-financial benefits. **Tailor your recommendations to your audience.** Whether it's a board of directors, a team of executives, or another decision-making body, make sure your presentation of findings resonates with their priorities and concerns. This will help ensure that your cost-benefit analysis is not just a set of numbers, but a persuasive tool for making informed and strategic decisions. --- ## **Finance Alliance Pro Membership** Tired of feeling stagnant in your FP&A career? Take control and unlock your true potential with the **Finance Alliance Pro Membership** and: - **Engage in high-level discussions** with peers, sparking innovative ideas and expanding your perspective. - **Sharpen your skills** with access to advanced financial analysis tools and expert-curated resources. ️ - **Unlock exclusive career opportunities** within a network of **industry leaders.** **Don't just survive your career, *thrive* in it.** **Join Finance Alliance Pro Membership today!** 🎓 [Sign Up](https://www.financealliance.io/pro-membership/) ### What does a finance director do? (Career guide) URL: https://www.financealliance.io/what-does-a-finance-director-do/ Last updated: 2026-03-05T09:45:18.000Z A finance director is a senior board member who’s responsible for managing a company’s finances. They use their [experience](https://www.financealliance.io/top-10-fp-a-skills-to-master/) and financial know-how to advise on spending, making sure everything aligns with the company’s larger objectives. But what does a finance director do? And how do you know if the position is right for you? In this career guide, we take you through all the major pillars of this role, such as: - [Key responsibilities](https://www.financealliance.io/p/0ec26fdd-494b-4929-bb23-12f67f13bddc/#responsibilities) - [Skills](https://www.financealliance.io/p/0ec26fdd-494b-4929-bb23-12f67f13bddc/#skills) - [Qualifications](https://www.financealliance.io/p/0ec26fdd-494b-4929-bb23-12f67f13bddc/#qualifications) - [Certifications](https://www.financealliance.io/p/0ec26fdd-494b-4929-bb23-12f67f13bddc/#certifications) - [Experience](https://www.financealliance.io/p/0ec26fdd-494b-4929-bb23-12f67f13bddc/#experience) - [Salary](https://www.financealliance.io/p/0ec26fdd-494b-4929-bb23-12f67f13bddc/#finance-director-salary) ...and more. So, let’s dive in. 👇 #### ****Key takeaways** - A finance director's main purpose is to oversee the financial health of a company. - An MBA is not mandatory for finance directors, but it can be a big competitive advantage. - 5-10 years of experience is typical for this role. ## **What does a finance director do?** Alright, let’s get to the core question: what does a finance director do? A financial director juggles *a lot* of different responsibilities, but it all comes down to one main goal: **ensuring the financial stability** of the company. To do this, they provide guidance to help the company meet its financial commitments while attaining its overarching goals. The finance director will also head the development of [policies and procedures](https://www.financealliance.io/finance-and-compliance/) to uphold financial management and control over the company's business operations. ## **Responsibilities** The responsibilities of a finance director may differ from one company or industry to another, but their main duties tend to cover: - [Creating budgets](https://www.financealliance.io/flexible-budget-performance-report/) that meet the needs of each department. - Building annual financial plans and [forecasts](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/). - Offering advice and guidance to executives on financial decisions. - Examining potential financial risks and gains for business initiatives. - Assessing possible [investment](https://www.financealliance.io/chief-investment-officer-vs-chief-financial-officer/) opportunities. - Providing funds for capital projects and keeping financials in check with the Facilities Director (if there is one). - Managing the company’s financial operations. - Supervising the creation of the company's financial records to make sure they’re presented on time and accurately. - Overseeing and facilitating training for accountants on staff. - Performing weekly and monthly financial evaluations and creating reports for senior management. - Conducting recurring financial reviews. [When financial hedging falls short: Resilience beyond derivativesIn a world where the next crisis always differs from the last, the ability to survive the unforeseeable matters more than perfectly hedging the risks we can measure.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-394.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--12-.png)](https://www.financealliance.io/when-financial-hedging-falls-short-why-companies-need-resilience-beyond-derivatives/) ### **Day-to-day vs strategic responsibilities (with examples)** Finance directors operate across two distinct modes: operational execution and strategic [leadership](https://www.financealliance.io/financial-leadership-in-changing-times-2/). Understanding how these responsibilities divide (and how that division shifts based on company context) helps you frame your experience effectively, whether you're building toward the role or hiring for it. As Amit Singhi, a finance executive, notes, one of the key things finance does is "drive the operating cycle": the monthly, quarterly, and annual cadence of [budgets](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), [forecasts](https://www.financealliance.io/how-to-forecast-inventories/), and plans. That cadence sits at the intersection of operational and strategic work, and the finance director typically owns both sides of it. Janice Lambert, former CFO at the Smithsonian Institution, observed that in many organizations, [finance team](https://www.financealliance.io/fp-a-team-structure/)s "spent the majority of the time on transaction processing and reporting" because they lacked the tools and skill sets for higher-value analytical work. Strong finance directors actively manage this tension, building systems and teams that handle operational demands efficiently so they can dedicate meaningful time to strategic contribution. The split between operational and strategic work changes significantly based on company size and team maturity. In lean finance teams, the finance director often spends 70% or more of their time on operational execution; close, reporting, cash management, approvals. As the team scales and processes mature, that ratio can shift toward 50% or even 40% operational, freeing capacity for business partnership and strategic planning. For recruiters and hiring managers, look for candidates who can articulate both types of work clearly. The best finance directors describe specific operational accomplishments (reducing close time, implementing controls, improving cash visibility) alongside strategic contributions like leading a budget transformation, supporting a funding round, or building a forecasting capability. For candidates, frame your experience to show you can operate at both levels, because that's what the role demands. [How to turn forecasting & budgeting mistakes into successesExplore key lessons in implementation processes and corporate strategy, and how you can use them to achieve real, tangible results in your FP&A function.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-395.png)Finance AllianceJames Manning![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--9--3.png)](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) ## **Finance director KPIs: how success is measured** Measuring a finance director's effectiveness requires looking beyond whether the books balance. The role spans operational execution, financial stewardship, and business partnership, and the [KPIs](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) should reflect all three dimensions. Simon Dealy emphasizes that while finance has "hundreds of KPIs," what matters is identifying "a good subset of data" that shows whether the company is on track to achieve its strategic objectives. That subset should include both financial and non-financial indicators, and the data must be accurate before it reaches the CEO or board. ### **Cash and liquidity** Cash visibility and working capital management sit at the core of finance director accountability. Key metrics include days sales outstanding (DSO), days payable outstanding (DPO), cash conversion cycle, and forecast accuracy on cash position. Good performance means the company never faces unexpected liquidity constraints and working capital is optimized for the business model. ### **Close and reporting** Timeliness and accuracy of [financial reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) reflect operational discipline. Track days to close (monthly, quarterly), number of post-close adjustments, and audit findings. A well-run finance function closes quickly, with minimal corrections and clean audit outcomes. ### **Forecast accuracy** [Forecast](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) accuracy serves as a leading indicator of finance's understanding of the business. Measure variance between forecast and actual results at revenue, gross margin, and operating income levels. Amit Singhi notes the importance of understanding what drives changes )"how much was volume, how much was pricing, how much was mix") which reflects the analytical depth behind the forecast. ### **Budget performance** Budget adherence and variance analysis show whether the organization is executing against plan. Track budget vs actual at the department and company level, and monitor the quality of variance explanations provided to leadership. ### **Controls and compliance** Audit findings, control deficiencies, and [compliance](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) incidents are lagging indicators of control environment health. The goal is zero material weaknesses and minimal significant deficiencies. ### **Business partnering** This is harder to quantify but essential. Consider tracking the number of strategic initiatives supported by finance analysis, stakeholder satisfaction scores, and the finance team's involvement in key business decisions. Target-setting should reflect context. A [high-growth company](https://www.financealliance.io/guide-to-company-growth/) may tolerate wider forecast variances in exchange for speed, while a mature business expects tighter accuracy. Industry norms, systems maturity, and growth stage all influence what "good" looks like. The finance director's job is to establish appropriate targets, measure consistently, and improve over time. ## **Skills** Here’s a simple overview of some key finance director skills: ![What does a finance director do - key skills of a finance director](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/What-does-a-finance-director-do---key-skills-of-a-finance-director.png) As you can see, there are quite a lot of skills that potential employers will expect you to have. For example, you need to have a firm understanding of all things finance and accounting (no surprises there). Beyond the numbers though, you’ll need excellent **business acumen** and **strategy** **skills**. This is because as a finance director, you’ll often map out long-term money strategies that’ll keep the company heading in the right direction. [**Leadership**](https://www.financealliance.io/financial-leadership-in-changing-times-2/) is huge too. As head of the finance team, you’re responsible for motivating and guiding them in their roles. You’re also expected to have strong **communication** skills to convey complex financial information to different audiences. **Analytical** skills are also a must because you’ll often analyze situations and from there, spot issues, weigh the risks, and come up with smart solutions. This becomes even more difficult when the pressure is on, and deadlines are looming. Another important skill for finance directors is general **computer** and technical skills. In this role, you’ll use a lot of different tools and software, so being proficient in things like [Excel](https://www.financealliance.io/chatgpt-for-excel/) is *crucial*. With their eagle-eyed attention to detail, a finance director ensures the books are spotless and everything's ‘by-the-book’ compliant. But it's not just about following rules; they need genuine business smarts to understand how to best advise the company to meet its [financial goals](https://www.financealliance.io/10-big-picture-financial-planning-steps/). ## **Qualifications** Finance directors must have certain qualifications, industry experience, and professional skills to land the role (and succeed in it). If you’re thinking about becoming a director of finance, you’ll need a relevant bachelor’s degree in a related field like finance or [accounting](https://www.financealliance.io/transforming-from-accounting-to-fp-a-business-partnering/). You’ll also have a competitive edge with a Master of Business Administration (MBA) or a similar master’s degree with emphasis on finance, economics, money and banking, or accounting, etc. ***Note:** *Although an MBA can be required in some cases, it isn’t always. However, having one will help to set you apart from other candidates. It shows that you have a broader understanding of finance, business operations, and strategic thinking.* ## **Certifications** Some finance directors choose to complete professional certifications to help develop their skill sets and advance their careers. A few favorites amongst finance professionals include: - [Certified Public Accountant (CPA)](https://cpaa.co.uk/?utm%5Fmedium=adwords&utm%5Fcampaign=&utm%5Fsource=&utm%5Fcontent=378469588228&utm%5Fterm=&gad%5Fsource=1&gclid=CjwKCAjw88yxBhBWEiwA7cm6papEd1y99SIL6CIt1k1bOlnilWLlFqod21Dpqti61lPYkRweoDtVtxoCF1QQAvD%5FBwE) - [Chartered Financial Analyst (CFA)](https://www.cfainstitute.org/en/programs/cfa) - [Certified Treasury Professional (CTP)](https://ctpcert.afponline.org/) - [Certified Financial Planner (CFP)](https://www.cfp.net/) - [Chartered Global Management Accountant (CGMA)](https://www.aicpa-cima.com/resources/landing/becoming-a-cgma) - [Financial Risk Manager (FRM)](https://www.garp.org/frm) There are others you may want to consider, so take some time to do your research and decide if pursuing a certification is beneficial for you. ### **CPA vs CFA for finance directors: which one matters more?** The short answer is that it depends on where you want to focus your career. CPA credentials signal deep expertise in accounting, controllership, compliance, and audit readiness: the foundational work that keeps a company's financial house in order. CFA credentials signal strength in [investments](https://www.financealliance.io/multiple-on-invested-capital-moic/), valuation, and capital markets: skills that matter most when the role involves funding strategy, investor support, or corporate development. For most finance director positions, particularly those with heavy responsibility for financial reporting, internal controls, and regulatory compliance, the CPA tends to carry more weight. It demonstrates that you can own the close, manage audits, and ensure the numbers are defensible. In markets like the US, UK, and Australia, CPA or equivalent chartered accountant credentials often serve as a baseline expectation for senior finance roles. The CFA becomes more valuable in specific contexts. If you're working in a private equity-backed company where valuation, deal modeling, and investor communication are central to the role, the CFA signals relevant expertise. Similarly, if your finance director position involves significant [treasury](https://www.financealliance.io/corporate-treasury-guide-plus-3-strategies-to-save-your-company-a-fortune/) work, capital allocation decisions, or corporate development activity, the CFA credential can differentiate you. ![CPA vs CFA for finance directors: which one matters more?](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/Finance-Director-certifications-2.png) Consider three common scenarios. A [controller](https://www.financealliance.io/cfo-vs-controller/) moving into a finance director role will typically benefit more from CPA credentials, since the work builds directly on accounting foundations. A finance director at a private equity-backed roll-up, where deal support and investor reporting dominate, may find the CFA more relevant. And in corporate development-heavy environments, where [M&A](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) analysis and valuation work are frequent, the CFA often provides a clearer advantage. That said, experience often matters more than credentials once you reach a certain level. A finance director with ten years of close ownership, strong controls implementation, and demonstrated business partnership will typically outcompete someone with certifications but limited operational depth. The certification question is really about signaling and skill development; choose the one that aligns with the type of finance director you want to become. [Budgeting & Forecasting course | Christian WattigLearn the specific techniques to build accurate, efficient and trackable budgets and forecasts from start to finish.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/aed38082539eca9d9b8e4ba1e12ca808-2.png)The AllianceThe Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/3e76cd6ed0de16ffd9f792779e867862-1.jpg)](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ## **Experience** Most will need a minimum of five years of experience in a management role in finance. For example, they could have experience as a financial manager, controller, or even as an assistant finance director. Having this type of experience is essential because it gives you a solid understanding of accounting principles, [financial analysis](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/), and the day-to-day workings of financial operations. While not always mandatory, knowing the ins and outs of the specific industry of the company you’re applying for can be a major advantage. By understanding the financial landscape, regulations, and unique challenges of the industry, you can become a more targeted and relevant advisor, making you even *more* appealing to those making the hiring decisions. ## **Career path: accountant to finance director** The path from accountant to finance director typically spans 10 to 15 years and involves deliberate skill-building at each stage. Understanding what changes at each level (and what you need to demonstrate to move up) helps you plan your progression intentionally. Santiago Spada, former CFO and Head of HR at Pirelli Tires Australia, describes a common trajectory: starting in audit at a firm like KPMG, which provided "really good exposure to a number of different companies and different businesses," before moving into head of finance roles at multinationals and eventually reaching the CFO level. John Cochrane, another [finance leader](https://www.financealliance.io/financial-leadership-in-changing-times-2/), came up through a traditional accounting path, starting in public accounting before helping "manage the cash engine at a variety of different startup businesses." ### **The typical progression ladder** **Stage 1: Staff Accountant (Years 1-3)** You're learning the mechanics: journal entries, reconciliations, supporting the close. Focus on accuracy and understanding how transactions flow through the system. **Stage 2: Senior Accountant (Years 3-5)** You own specific areas of the close and begin reviewing others' work. Start building relationships with business partners who provide the data you need. **Stage 3: Accounting Manager or Finance Manager (Years 5-8)** You manage a team and own the close process end-to-end. This is where you develop leadership skills and begin contributing to [budgeting](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/) and forecasting. **Stage 4: Controller or Senior Finance Manager (Years 8-12)** You're responsible for all accounting operations, controls, and financial reporting. You work directly with auditors and begin advising leadership on financial decisions. **Stage 5: Finance Director or Head of Finance (Years 12+)** You own the entire finance function and serve as a strategic partner to the business. You're accountable for financial performance, not just financial reporting. ### **Skills to build at each stage** - Early career focuses on technical accounting and close execution. - Mid-career requires developing [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) capabilities, cash management skills, and the ability to lead teams. - Senior roles demand business partnership, strategic thinking, and executive communication. [Fast-track your FP&A career with tips, success stories, and networking strategiesFP&A is not always a clearly signposted career path, and for many people, myself included, it’s something you only really understand once you’re already in the world of work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-396.png)Finance AllianceJon Yuregir![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--15--1.png)](https://www.financealliance.io/fast-tracking-your-fp-a-career/) ### **Three portfolio-building moves that accelerate readiness** 1. **Own the monthly close.** Take full accountability for close timing and accuracy. Reducing close time from 15 days to 10 days demonstrates operational leadership. 2. **Lead a budget cycle.** Volunteer to coordinate the annual budget process. This builds [cross-functional relationships](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/) and strategic planning skills. 3. **Implement a system or process improvement.** Whether it's a new reporting tool, an automation initiative, or a controls enhancement, demonstrating that you can drive change shows readiness for senior leadership. ### **Alternative paths** The audit-to-controller-to-FD path is common, but not the only route. Some finance directors come through FP&A, building forecasting and business partnership skills before taking on broader finance leadership. Others arrive via treasury, particularly in capital-intensive industries where cash management is central to the role. The key is developing breadth across accounting, [planning](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/), and business partnership, regardless of which function you start in. ## **The difference between a finance director and similar roles** People often get confused when trying to distinguish between a finance director and other senior finance roles within an organization, and it’s understandable. The titles can sound similar, which leads to confusion about the specific responsibilities and hierarchies involved. You’ll also find a lot of similar responsibilities between these roles, so let’s clear the air and break down some of the key differences between them: ### **Finance Director vs Chief Financial Officer (CFO)** The main difference between a CFO vs director of finance lies in their positions within the company. The CFO is the *most* senior member of the finance team. They oversee the company’s financial operations, focusing on the long-term vision and strategic goals of the business. The finance director, on the other hand, oversees the day-to-day financial operations and is the company’s chief accountant. They manage the accounts of the company and prioritize short-term objectives. [How to become a fractional CFO | Finance AllianceMany CFOs have left full-time positions to regain control of their careers and their time. But how did they do it? That’s what you’ll find out in this blog post as we uncover how to become a fractional CFO.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-397.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--3--4.png)](https://www.financealliance.io/how-to-become-a-fractional-cfo/) ### **Differences for Finance Directors in a startup vs a large company** The distinction between a finance director and CFO looks very different depending on company size and stage. In a seed-stage startup or early SMB, one person often owns both roles entirely. The finance director title might appear on the org chart, but the actual work spans everything from closing the books to pitching investors to managing the company's line of credit. As Simon Dealy, a seasoned finance leader, explains, senior finance work at growing companies involves understanding whether growth will come through organic expansion, M&A, or new markets, and then determining how to fund that strategy, whether through credit facilities, capital raises, or private investment. In larger corporations, these responsibilities separate cleanly. The CFO operates at the executive level, focused on board strategy, investor relations, and long-term capital allocation. The finance director manages the operational finance function: monthly close, reporting accuracy, compliance, and cash management. The CFO sets the direction; the finance director ensures the engine runs. ![Differences for Finance Directors in a startup vs a large corporation](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/startup-vs-a-large-company-1.png) Some responsibilities shift predictably as companies scale. Capital raising, M&A due diligence, and board-level strategy typically move from the finance director to the CFO once the company reaches a certain complexity threshold. Investor relations and public market communications almost always sit with the CFO in larger organizations. Here's a simple rule of thumb: if you're leading capital structure decisions, negotiating with institutional investors, or presenting to the board on strategic direction, you're operating in [CFO territory](https://www.financealliance.io/your-first-90-days-as-cfo/). If you're owning the close, managing working capital, ensuring audit readiness, and driving budget accountability, that's classic finance director work. In practice, the best finance directors in growing companies develop both skill sets, because the line moves as the company scales. ### **CFO vs Finance Director: Three main differences** **Experience:** CFOs tend to have extensive experience in finance with a broad and deep understanding of finance across various industries. They typically have over 20 years of experience, whereas finance directors tend to have around 5-10 years of experience. **Level in the company:** The [CFO](https://www.financealliance.io/why-cfos-need-to-be-people-managers/) is part of the executive team, making them high-level decision-makers. Finance directors aren’t quite at that level. They’re considered to be senior management so that makes them about one level below the CFO. **Responsibility:** Finance directors are responsible for analyzing budgets, account management, ensuring compliance, and monitoring cash flow. CFOs, on the other hand, collaborate with executives, oversee the financial strategy, and develop growth plans. ***Note:** *The finance director reports to the CFO. In some companies, especially smaller ones, the roles of the CFO and finance director may be combined, or the finance director might report directly to the CEO if there is no CFO.* ### **Finance Director vs Finance Manager (and when to hire each)** The distinction between a finance director and a finance manager comes down to mandate and scope. A finance manager typically leads a functional area within finance: accounts payable, [financial reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/), or FP&A, for example. A finance director serves as the company-wide finance leader and executive partner, accountable for the entire finance function and its contribution to business strategy. Janice Lambert observed that many organizations have finance teams that "spent the majority of the time on transaction processing and reporting" because they lack the capability for higher-value analytical work. When a company reaches the point where it needs that higher-value work (forecasting, decision support, strategic planning) it often signals the need for finance director-level leadership rather than additional finance managers. Simon Dealy notes that at the senior finance level, "you shouldn't be getting too far down into the minutiae of the transactional executing," but you need to understand what's happening and have confidence in your team. That distinction captures the difference: finance managers execute; finance directors ensure execution happens while focusing on strategic contribution. ### **Hiring triggers: When to upgrade from Finance Manager to Finance Director** - **Investor or board demands:** External [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) expect a senior finance leader who can present financial performance, answer strategic questions, and provide credible guidance. - **Multi-entity complexity:** Managing multiple legal entities, currencies, or business units requires someone who can design and oversee consolidated reporting and controls. - **Audit readiness:** Preparing for external audits, particularly first-time audits or audits required for fundraising, demands senior finance leadership. - **Capital planning needs:** When the company needs to model funding scenarios, manage banking relationships, or support capital raises, that work typically exceeds a finance manager's scope. - **Department budgeting rigor:** As the organization grows, budget ownership and accountability across departments requires someone with the authority and perspective to drive discipline. ### **Three company scenarios** **Early-stage startup (under 20 employees):** A strong finance manager or fractional finance leader often suffices. The volume of transactions is manageable, and strategic finance needs are limited. **Fast-growing mid-market (50-200 employees):** This is typically when a finance director becomes essential. Complexity increases, external stakeholders multiply, and the CEO needs a finance partner, not just a finance function. **Mature enterprise division:** A finance director manages the division's finance operations, reporting to a group CFO. The role focuses on operational excellence and business partnership within the division's scope. ### **Interview litmus test** If you're unsure which role you need, ask these questions during the hiring process: - Do we need someone to execute financial processes, or to design and oversee them? - Will this person present to the board or investors? - Are we expecting strategic recommendations, or accurate reporting? - Does this role require building a finance team, or managing existing staff? If the answers lean toward design, board presence, strategic input, and team building, you need a finance director. If the answers focus on execution, internal reporting, and managing existing processes, a finance manager may be the right fit. ### **Head of Finance vs Finance Director** The terms "head of finance" and "finance director" are often used interchangeably, especially in smaller or fast-growing companies. However, they can also be two distinct roles. Here are some points to keep in mind when comparing the roles of head of finance vs finance director: - The head of finance title can often be used to refer to the top finance position in smaller companies where there is no CFO. - They both share similar responsibilities. However, the head of finance usually has a more hands-on managerial role in the finance operations rather than being purely strategic. - While experience varies, head of finance roles often require 5-10 years of experience in financial management, similar to what’s expected from a finance director. ### **Director of Finance vs Financial Controller** A financial controller is typically the head of an accounting department, while the financial director takes on a leadership role. A financial controller’s focus is to ensure accuracy and compliance in daily financial operations. Their main responsibilities include: - Managing the accounting team and ensuring accurate financial records. - Preparing financial statements (balance sheet, income statement, etc.). - Overseeing internal controls and compliance with financial regulations. - Managing [cash flow](https://www.financealliance.io/cash-flow-drivers-in-a-business/) and budgeting. ****Experience:** Controllers usually have around 5-10 years of experience in accounting and financial reporting. ### **What is an Assistant Financial Director?** An assistant financial director is the right-hand person to the finance director or CFO, acting as a bridge between senior leadership and the day-to-day operations of the finance department. They also support strategic initiatives and may oversee the finance team to some degree, ensuring smooth operations and providing support where needed. ## **Finance director salary** A finance director's job is obviously very important, so they tend to get paid pretty well. But there are a few things that can affect how much they make: **1\.** 🌎 **Location:** Where you work can make a *huge* difference in how much you get paid. The big money is in major finance hubs like London or New York. Smaller cities and towns typically don’t pay as much, which is something to keep in mind. **2\.** ⭐ **Industry**: The kind of industry also matters. Finance directors in heavily regulated fields like banking or healthcare can often rake in more compared to other industries. **3\.** 🏢 **Company size:** Bigger companies with complicated financial operations usually pay their finance directors pretty well to get top talent. Smaller companies aren’t always able to compete on salary. **4\.** 🎓 **Experience**: Just like most jobs, more experience can equal more money. Those with a long-proven track record can demand higher salaries. **5\.** 🎨 **Skillset:** Finance directors who have it all (amazing number [skills](https://www.financealliance.io/top-10-fp-a-skills-to-master/), leadership abilities, deep industry know-how) can earn a higher salary than someone lacking important skills. ### **Salary ranges** **US:** *Finance director salaries in the US can range from $100,000 to $240,000+ annually, depending on the factors mentioned above.* **US averages from key sources:** - [Salary.com](https://www.salary.com/research/salary/benchmark/finance-director-salary) reports the average salary of a finance director to be anywhere from **$187,185 and $227,209** with top earners making **$248,863**. - [Built in](https://builtin.com/salaries/finance/finance-director) states the average base salary of **$162,248** with an additional cash compensation of **$31,505**. - [Indeed](https://www.indeed.com/career/director-of-finance/salaries) reports the average salary to be **$121,638** per year in the United States. **UK averages from key sources:** - [Indeed](https://uk.indeed.com/career/director-of-finance/salaries) reports an average base salary of **£88,940.** - [Glassdoor](https://www.glassdoor.co.uk/Salaries/finance-director-salary-SRCH%5FKO0,16.htm) states an average salary range between **£79,000 to £124,000** with an additional cash compensation average of **£21,567**. [Finance Alliance Salary Report 2025Uncover the truth about what your finance peers are earning and see how your salary measures up with the Finance Alliance Salary Report 2025! 💵![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-398.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Salary_Survey_2025_Meta-2.png)](https://www.financealliance.io/finance-salary-report/) ## **How to become a finance director** Alright, we’ve covered most of the basics about the role of a finance director, so let’s get into the steps to become one. Of course, not everyone’s career path to this role will look the same. But the steps to reach that position tend to look something like this: ### **Step 1: Earn a relevant degree** You’ll need a bachelor’s degree in finance, economics, accounting, business administration or a related field. While not mandatory, a relevant MBA or PhD will also help you become more desirable to potential employers. ### **Step 2: Gain experience** If you can take an internship while in university, you should consider it. Building experience early will help you gain experience before you graduate. From there, you’ll need to gain more experience by securing roles or positions within the finance department. Aim for at least five years of experience. ### **Step 3: Develop your skill set** A lot of finance directors move up the ladder by getting promoted at their current company. Or they use a finance position somewhere else as a stepping stone. Either way, it’s important to prioritize developing and proving your skills in finance, accounting, leadership, communication, and more. 💡 ****Tip:** During this period in your career, you can discover new opportunities, build skills, and learn from others by networking. ### **Step 4: Target your job search** When applying for finance director positions, tailor your resume and cover letter to highlight the specific skills and experience required for the role. Emphasize achievements and contributions that demonstrate your ability to lead and make a strategic impact on the company's financial health. #### ****FAQs: Finance director role** ****Q.** ****What are the qualities of a good finance director?** Strong analytical skills, strategic thinking, leadership, communication, and a deep understanding of financial regulations are key qualities. ****Q.** ****What is the role of a finance director?** A finance director manages the company's financial planning, reporting, budgets, and financial policies. ****Q. What qualifications do you need to be a financial director** Typically, a bachelor’s degree in finance or accounting, often supplemented by an MBA or professional certifications like CPA or CFA. ****Q. What are the expectations of a finance director?** They are expected to ensure financial health and growth, provide strategic financial guidance, and manage financial reporting and budgeting. ****Q. How can I be a better finance director?** Enhance your financial knowledge, improve leadership skills, stay updated with industry trends, and foster strong team collaboration. ****Q. Is finance director the same as CFO?** No, a finance director is not the same as a CFO. The CFO is a higher-level executive who oversees the broader financial strategy of the organization. ****Q. What does a finance director earn?** A finance director typically earns between $90,000 and $200,000 annually, with variations based on factors like industry, location, and company size. ****Q. Is Finance Director higher than finance manager?** Yes, a finance director is typically higher than a finance manager and oversees broader financial operations. ****Q. Is a Finance Director an accountant?** A finance director often starts as an accountant but their role encompasses broader strategic and management responsibilities. ****Q. Does a finance director report to the CFO?** Yes, in most companies, the finance director reports to the CFO. ### When financial hedging falls short: Why companies need resilience beyond derivatives URL: https://www.financealliance.io/when-financial-hedging-falls-short-why-companies-need-resilience-beyond-derivatives/ Last updated: 2026-03-02T12:32:36.000Z Corporate risk management has long been sold as a simple proposition: identify risks, hedge them with derivatives, and protect shareholder value. But [new research from René M. Stulz](https://www.annualreviews.org/content/journals/10.1146/annurev-financial-112823-022941) reveals a more complex reality. While financial instruments can effectively manage certain near-term risks, they prove surprisingly limited when companies face the uncertainties that matter most for long-term survival and [growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/). ## **The foundational shift in risk management thinking** Traditional finance theory teaches that diversified investors can manage idiosyncratic risk themselves, making corporate [risk management](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) unnecessary. Stulz challenges this orthodoxy with a compelling analogy: saying firms shouldn't manage risk because investors can diversify is like saying buildings shouldn't have sprinkler systems because owners have insurance. The sprinkler system prevents destruction that insurance money cannot reverse. This perspective fundamentally changes how we should think about corporate risk management. When adverse outcomes carry deadweight costs that destroy value permanently, risk management becomes essential for maximizing shareholder wealth. These costs manifest in various ways: talented employees leave distressed firms, customers abandon companies they fear might not honor warranties, and valuable investment opportunities disappear when internal funding dries up. The research identifies several key mechanisms through which risk affects firm value. Managers, unlike diversified [shareholders](https://www.financealliance.io/investor-relations-as-a-strategic-driver-of-corporate-value/), cannot easily hedge their human capital and thus may reject valuable but risky projects without proper risk management tools. Financial distress imposes costs that extend far beyond immediate cash flow problems. Companies in distress see their competitive position erode as stakeholders lose confidence. Tax optimization becomes impossible when volatile earnings prevent companies from fully utilizing debt tax shields. [![CTA Image](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/DO-NOT-OVERRIDE-PMA_Webinar_Meta_Template_--4---1--1.png)](https://www.financealliance.io/inside-the-fx-playbook/) Join us on March 19 for a practical live session on managing FX risk. [Secure your spot for this live, practical session ](https://www.financealliance.io/inside-the-fx-playbook/) ## **The reality of derivatives use reveals surprising limitations** Despite the theoretical promise of financial risk management, empirical evidence paints a picture of limited implementation. While approximately 60% of large nonfinancial firms use derivatives, their usage remains remarkably narrow in scope. The most striking findings come from studies of companies with clearly identifiable exposures. Gold mining firms, whose value directly ties to gold prices, hedge on average only 25% of their production over the next two years. Oil and gas producers show similar patterns, hedging about 33% of production when they hedge at all. More remarkably, these companies hedge just 4% of their reserves, focusing almost exclusively on near-term production rather than long-term value. This limited hedging extends across industries. Companies primarily use derivatives for specific, well-defined transaction exposures like a foreign currency payment due in 90 days. They rarely attempt to hedge their overall economic exposure or firm value directly. Even when companies use derivatives, the economic impact often proves modest. Research shows that for a typical firm, a three-standard-deviation move in interest rates, exchange rates, and commodity prices simultaneously would change the value of their derivatives portfolio by only 1% of market value. ## **Why financial risk management faces inherent constraints** The limited use of derivatives isn't simply a failure of implementation. Stulz identifies three fundamental constraints that prevent financial risk management from addressing many critical corporate risks. [6 strategies for FP&A to master scenario planning and risk managementHow FP&A can help the organization prepare for potential outcomes, mitigate risk, and remain resilient and forward-focused.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-391.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-5-3.png)](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) ### **Complexity and uncertainty create measurement challenges** Short-term transactional risks like foreign currency receivables are straightforward to quantify and hedge. But consider the impact of exchange rate changes on a company's competitive position over five years. Future cash flows depend on complex, nonlinear relationships involving competitive dynamics, market evolution, and strategic choices. A company might exit a market if exchange rates move too far, or [innovation](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) might completely change its exposure profile. This complexity means that attempts to hedge long-term exposures could actually increase risk rather than reduce it. If a company hedges based on incorrect forecasts of its future foreign currency exposure, it creates new risks rather than eliminating existing ones. As one study found, when uncertainty comes from both demand and supply sides, hedging often proves ineffective regardless of the approach taken. ### **Accounting rules create perverse incentives** The disconnect between economic hedging and accounting treatment creates another major barrier. Consider a company hedging [foreign exchange](https://www.financealliance.io/inside-the-fx-playbook/) exposure expected to materialize in three years. While this hedge might reduce economic risk, it often increases earnings volatility because gains and losses on the derivative flow through quarterly earnings while the underlying exposure remains invisible in financial statements. This accounting mismatch makes many economically sensible hedges appear destructive to reported performance. Since management compensation and market perceptions often depend heavily on earnings stability, executives face strong incentives to avoid hedges that increase accounting volatility, even when those hedges would reduce real economic risk. [Does job-hopping increase your salary in finance?The question isn’t whether job-hopping increases salary, as it clearly does. The more important question is how and when to move in order to maximise long-term value.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-392.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--6--5.png)](https://www.financealliance.io/does-job-hopping-increase-your-salary-in-finance/) ### **Operational frictions limit implementation** Derivatives require collateral and create liquidity demands that can prove problematic precisely when hedging is most needed. A company entering financial distress may find itself unable to post required collateral for new hedges or maintain existing positions. Variation margin calls on existing derivatives can drain liquidity during adverse market moves, potentially accelerating distress rather than preventing it. These frictions help explain why financially constrained firms often turn to operational hedges like long-term purchase agreements with suppliers rather than financial derivatives. While potentially less efficient, these arrangements don't require upfront collateral or create ongoing liquidity demands. ## **Building resilience when hedging isn't enough** Given these limitations, Stulz argues that companies must look beyond financial hedging to build resilience. Resilience represents the ability to absorb adverse shocks while continuing to pursue strategic objectives. Rather than trying to hedge specific risks that may be unmeasurable or unknown, resilient companies create general capacity to handle whatever [challenges](https://www.financealliance.io/client-portfolio-fractional-cfo/) emerge. Financial flexibility forms the foundation of resilience. Companies with conservative capital structures and substantial cash holdings can weather storms that would sink their leveraged peers. During the COVID-19 pandemic, companies with greater financial flexibility performed significantly better, despite none having specifically hedged against pandemic risk. This wasn't luck; it was the payoff from maintaining resilience against unforeseeable events. Operational flexibility provides another dimension of [resilience](https://www.financealliance.io/12-proven-strategies-for-managing-liquidity/). This might mean maintaining relationships with multiple suppliers rather than optimizing for the lowest cost, holding strategic inventory despite the working capital cost, or preserving geographic diversification even when concentration would improve margins. These choices look inefficient through a narrow optimization lens but prove valuable when disruptions strike. The evidence suggests companies understand this intuitively. Studies of industries facing deregulation show firms responding with multiple tools including cash holdings, operational adjustments, and geographic diversification alongside limited use of derivatives. The most successful companies don't rely on any single risk management approach but build layered defenses against uncertainty. [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-393.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--15.png)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) ## **Implications for AI and algorithmic risk management** This research holds particular relevance for [AI applications](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) in corporate finance and risk management. Current AI models excel at optimizing known parameters and managing quantifiable risks, exactly the areas where financial derivatives work well. But Stulz's findings highlight a critical gap: the most important risks facing companies often involve radical uncertainty that resists quantification. AI systems designed for corporate treasury or risk management must recognize these fundamental limitations. An algorithm optimizing purely for economic efficiency might recommend eliminating "wasteful" cash holdings or pushing leverage to theoretical limits. But doing so would strip away the resilience that enables companies to survive unmodeled shocks. The research suggests AI applications in risk management need to incorporate resilience parameters alongside efficiency metrics. Rather than optimizing for a single predicted future, these systems should evaluate strategies across wide ranges of scenarios, including those that cannot be precisely specified. The goal shifts from eliminating measurable risks to ensuring survival and strategic flexibility across unknowable futures. For supply chain AI, the implications are particularly direct. Systems that optimize solely for cost minimization create fragility. The paper's framework suggests these systems need explicit resilience constraints, maintaining operational slack even when it appears inefficient. The COVID-19 pandemic demonstrated that companies with "inefficient" supply chain redundancy often outperformed those with lean, optimized operations. ## **Rethinking risk management for an uncertain world** Stulz's research fundamentally challenges how we think about corporate risk management. The promise that financial engineering could eliminate business risks through clever use of derivatives proves far too simplistic. While these tools play a valuable role in managing specific, near-term exposures, they cannot address the complex, uncertain risks that truly threaten corporate survival and success. Instead, companies must embrace a broader conception of risk management that prioritizes resilience alongside efficiency. This means maintaining financial and operational flexibility that looks wasteful in calm times but proves invaluable during storms. It means accepting that some risks cannot be measured, much less hedged, and preparing for that reality. For practitioners and researchers in AI and finance, this framework demands humility about what optimization can achieve. The most sophisticated models cannot eliminate the need for judgment about unknowable futures. Building systems that enhance resilience rather than merely maximizing efficiency represents the next frontier in corporate risk management. In a world where the next crisis always differs from the last, the ability to survive the unforeseeable matters more than perfectly hedging the risks we can measure. --- ### **Learn more about FX risk management** [**Join us on March 19 for a practical live session**](https://www.financealliance.io/inside-the-fx-playbook/) about managing foreign exchange risk as your business scales. You’ll walk away with real-world strategies to protect margins, bring clarity to forecasting and board reporting, and simplify FX management without added complexity. [A simpler, safer way to manage FX as you scaleCalm, reassuring, and credible.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-390.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/DO-NOT-OVERRIDE-PMA_Webinar_Meta_Template_--4-.png)](https://www.financealliance.io/inside-the-fx-playbook/) ### CFO Playbook: Stop wasting 30% of your SaaS budget URL: https://www.financealliance.io/how-to-cut-saas-waste-without-slowing-growth/ Last updated: 2026-03-18T18:58:34.000Z The average enterprise now runs **400+ SaaS tools**, yet most finance teams still lack full visibility into software spend, licences, and vendor renewals. This playbook gives finance leaders a practical framework to audit SaaS spend, eliminate waste, and take control of vendor contracts and renewals. *Built for CFOs and senior finance leaders managing complex, multi-team SaaS environments.* ## The numbers finance leaders can’t ignore: - **Only 20–30% of SaaS features are actually used** - **60% of software purchases happen outside procurement** - **10%+ cost savings possible with better SaaS governance** Download the playbook to see where software spend slips through the cracks. ### Download your copy of the playbook: ## Why software spend gets out of control: In growing companies, software purchases rarely happen in one place. Over time, this creates blind spots in **software spend and vendor management**. - tools purchased across different departments - licences that aren’t being used - vendor contracts quietly auto-renewing - limited visibility over total SaaS spend Individually, nothing looks urgent. Together, they **inflate costs and erode margins**. This playbook shows CFOs and senior finance leaders how to take back control of SaaS spend without slowing the business. ## A quick preview [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/03/Screenshot-2026-03-02-at-09.18.15.png)](https://share-eu1.hsforms.com/1Z8GOYBVNS6eLIzyiQgkiew2b1vun) ## What you'll learn: - **Identify where SaaS spend is leaking** Spot the drivers of overspend before they hit your P&L - **Catch renewals early** Avoid unnecessary vendor costs before contracts roll over - **Improve software spend visibility** Get a clearer view across teams and departments - **Make procurement a partner** Enable control without slowing the business - **Reduce SaaS spend at scale** Apply practical levers that actually work **Plus:** - 3 actions you can take this quarter - 2 longer-term strategies to build lasting cost discipline ## Why this matters: The European SaaS market is projected to reach ****€16.3B**, growing ****19% year over year**. Companies with ****800+ employees now run 400+ SaaS applications on average.** Without clear oversight, software spend can quickly become one of the **fastest-growing cost categories in the business.** If you’re responsible for protecting margins, improving forecast accuracy, and enabling sustainable growth, this playbook gives you a practical way to regain control. Download the playbook to see what’s hiding in your SaaS stack and regain control of software spend. [Get the playbook](https://share-eu1.hsforms.com/1Z8GOYBVNS6eLIzyiQgkiew2b1vun) ### Secure-by-design FP&A: Automating planning without expanding the fraud surface URL: https://www.financealliance.io/secure-by-design-fp-a-automating-planning-without-expanding-the-fraud-surface/ Last updated: 2026-02-24T10:32:57.000Z [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) is among the fastest-evolving areas in finance; as a result, many FP&A organizations are moving toward automation much faster than their corresponding governance and security controls. For example, FP&A has experienced significant increases in the amount of [data](https://www.financealliance.io/financial-charts-and-graphs/) required to be processed and a decrease in the amount of time available to process the data. Additionally, executives expect immediate responses regarding how well a company is performing relative to prior periods (or other selected benchmarks). This creates a need for greater amounts of timely information and thus creates an environment where spreadsheets and manual consolidations will no longer provide the level of responsiveness required to meet those demands. As such, the promise of automation provides hope for meeting those demands; however, [automation](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) also creates a more silent, and therefore less noticeable, type of fraud risk. That silent type of fraud risk does not present itself through major breaches or ransomware; instead, it presents itself as subtle misrepresentations of fact, or confident decisions based on incorrect assumptions due to corrupted inputs used during automated processes. [IBM's Institute](https://www.ibm.com/thought-leadership/institute-business-value/en-us/report/ai-finance) for Business Value conducted research in regard to AI-based planning in FP&A and found that most of the [FP&A leaders](https://www.financealliance.io/transforming-from-accounting-to-fp-a-business-partnering/) surveyed believed that the adoption of AI-based planning would provide them with a high degree of improvement in forecasting accuracy (i.e., over 20%), and an even greater reduction in the time required to complete their planning cycles (i.e., double digits). These improvements were confirmed in the study. However, the same study also highlighted a growing gap between the maturation of planning automation and the preparedness of FP&A organizations to address the risks associated with the use of these types of [automation tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/). There is a paradox at the heart of modern FP&A. The very systems that are designed to increase the speed and precision of planning can create increased opportunities for errors and manipulations to occur in the automated systems if they are not built with security as a foundational element (i.e., security-by-design). [How to transform financial data into compelling storiesFP&A professionals have to understand the business deeply. We’re not just reporting results or explaining variances. We are taking on part of the decision-making burden.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-384.png)Finance AllianceLewis Danby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--5--6.png)](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) ## **Automation is changing the risk profile of FP&A** The way financial controls operated traditionally was based on the assumption of a stable operating environment. Prior to today's cloud-based planning solutions; [budgeting](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) was done annually and forecasting was done on a quarterly basis. Data flow was generally linear. Today's FP&A processes operate differently than they did historically. The primary difference is that today's FP&A processes rely on continuous ingestion of data from multiple sources (ERP, CRM, HRIS, billing systems), as well as APIs to synchronise assumptions across multiple tools in near real-time. Additionally, Business Intelligence (BI) layers publish information via dashboards for use by many functions outside of the finance department. Also, AI systems are now used to provide variance explanations, [narrative](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/) around scenarios, and even first-pass forecasts. The evolution of FP&A into a "distributed" system (as opposed to simply being a process within finance) has created a risk profile for distributed systems. Distributed systems fail in new ways. [6 strategies for FP&A to master scenario planning and risk managementHow FP&A can help the organization prepare for potential outcomes, mitigate risk, and remain resilient and forward-focused.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-386.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-5-2.png)](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) For example, when a forecast driver is changed in an upstream system, the change can have an immediate impact throughout the downstream reports, dashboards and executive presentations. Additionally, if access controls are too loose, or if it is difficult to understand where the data originated, it is possible that FP&A leaders will not know when a change occurs, potentially resulting in the [execution of business strategies](https://www.financealliance.io/how-cfos-power-business-strategy/) before a change is recognised. Therefore, security in FP&A cannot solely be owned by IT. Finance owns the models that drive capital allocation decisions, [hiring plans](https://www.financealliance.io/recruitment-in-finance-4-hiring-hacks/), pricing decisions and liquidity strategy. Therefore, when these models are compromised (either intentionally or unintentionally), the company does not lose data; it loses decision integrity. The majority of FP&A failures are based on mundane reasons rather than malicious ones. Some common examples include: [How financial services firms can protect against AI fraudNearly 70% of Americans say they would pay more for services that offer stronger protections, and 83% believe financial institutions should be doing everything possible to protect them from fraud.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-388.png)Finance AllianceGreg Bohl![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-3.png)](https://www.financealliance.io/how-financial-services-firms-can-protect-against-ai-fraud/) ### **The failure of clearly defining data lineage for automated reporting** "Smart" spreadsheets and automated reports have become an increasingly large part of the FP&A environment. However, the [transformation of data](https://www.financealliance.io/driving-digital-transformation-in-finance/) as it flows through these systems is typically implied (i.e. not explicitly stated) and therefore may never be documented. As a result, when a source system undergoes a change to its format or logic, the impact this has downstream may go unnoticed. Ultimately, numbers will begin to drift, confidence will continue to erode, and there will be no explanation for why the change is happening. ### **Excessive permissioning is another area where FP&A departments struggle** Self-service analytics is a very effective tool in enabling employees to quickly produce their own analysis. However, without proper guardrails, this self-service model also enables employees to export sensitive drivers, modify them and then import them into a new model with limited transparency. Industry analysts have consistently identified excessive permissions and inadequate segregation of duties as two of the largest factors in the success of internal fraud schemes within companies that utilise high levels of automation in their FP&A processes. [Fraud detection in 2025: Lessons from a decade in the trenchesLearn more about fraud detection and explore lessons to help companies stay secure in the face of persistent threats.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-385.png)Finance AllianceMaxim Filatov![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--55--3.png)](https://www.financealliance.io/fraud-detection-in-2025-lessons-from-a-decade-in-the-trenches/) ### **Generative AI represents another layer of risk in the FP&A process** Increasingly, FP&A departments are utilising generative AI (tools designed to assist users in creating models faster by automating routine tasks such as updating formulas, drafting comments and summarising variance) to automate some of the more time-consuming aspects of the FP&A process. According to a study conducted by IBM, more than 40% of finance organizations are either currently piloting or utilising generative AI in [analytical workflows](https://www.financealliance.io/why-finance-teams-struggle-to-act-on-their-data-and-how-to-fix-it/). While generative AI can significantly increase the productivity and efficiency of the FP&A team, it does create risks when sensitive data is sent to public tools for processing or when outputs generated by generative AI are utilised by the FP&A team without established review standards. Plausible does not mean correct. ### **The final area of risk for FP&A teams relates to integration sprawl and systemic fragility** Each API connection between systems represents a trust relationship. For example, when revenue drivers are flowing from a customer management system, headcount data is being pulled from an HR system and cost data is flowing from an ERP system, each of these integrations must be authenticated, authorized, logged and monitored. Unfortunately, too few FP&A teams have visibility into which system(s), user(s) and/or application(s) have access to modify the underlying planning inputs. This results in machine identities having the ability to influence planning inputs far more frequently and with far less oversight than human identities. ## **Designing security into the planning stack** Secure-by-design FP&A starts with a mental shift. Planning must be treated as a system with architecture, dependencies, and failure modes, not as a sequence of tasks. Teams that take this approach begin by mapping how data flows from source systems into models, where transformations occur, and who owns each decision point. The exercise is deceptively simple but revealing. Most organizations discover they cannot clearly articulate where their forecast truly originates. From there, the focus moves from blanket controls to impact-based governance. Not all finance data carries the same risk. A published [KPI](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) already shared across the company does not warrant the same scrutiny as a liquidity assumption or pricing model. By classifying planning elements based on business impact rather than mere sensitivity, finance leaders can concentrate controls where mistakes would be most damaging. Crucially, controls must be embedded into workflows rather than bolted on afterward. [Change management](https://www.financealliance.io/the-cfos-first-90-days-playbook/) for critical assumptions, versioning across planning cycles, and explicit approval stages are not bureaucratic overhead, they are what allow automation to scale without eroding trust. Organizations that implement these mechanisms consistently report smoother audits and fewer last-minute executive escalations, because disagreements shift from “whose numbers are right” to *“which decision makes sense”.* APIs and service accounts deserve the same scrutiny as senior finance users. Least-privilege access, clear ownership, credential rotation, and centralized logging are no longer optional in environments where integrations can materially change forecasts. Regulatory regimes like DORA make this explicit for [financial institutions](https://www.financealliance.io/how-financial-services-firms-can-protect-against-ai-fraud/), but the discipline applies just as forcefully outside regulated sectors. Monitoring, too, must align with financial reality. Security alerts that flag technical anomalies are of limited use to FP&A leaders. What matters are signals tied to business risk: unusual shifts in key drivers, edits outside normal planning windows, or new data sources appearing without review. These indicators catch quiet failures early, before they harden into executive narratives. As generative AI becomes more deeply embedded in finance work, simple rules make an outsized difference. Clear rules against sharing confidential data with public tools, requiring human checks on AI-generated results, and being open about how AI is used in [reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) all help keep experimentation safe and effective instead of careless. [How generative AI is transforming financeFinancial advisors could use AI to generate initial investment recommendations while focusing their expertise on understanding client needs and providing personalized guidance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-387.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--9--2.png)](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) ## **The real payoff: Trust at speed** When we design FP&A automation with security at its core, the benefits multiply. Forecast cycles accelerate not because teams rush, but because data is cleaner and assumptions are trusted. Leadership conversations shift away from reconciling numbers and toward debating trade-offs. Audit and compliance reviews become procedural rather than adversarial. Perhaps most importantly, opportunities for fraud and manipulation shrink. [Studies](https://coinlaw.io/automation-in-finance-statistics/?) of AI-enabled financial controls show that well-governed automation can improve anomaly detection by as much as 30%–50% while reducing false positives that drain analyst time. Automation, in other words, does not have to increase risk. Done right, it becomes a risk-reduction mechanism. The result is what resilience looks like in modern finance. Not perfect prevention, but systems that are transparent, testable, and recoverable, able to move fast without losing control. Secure-by-design FP&A is not a constraint on ambition. It is what makes ambitious automation sustainable. --- Looking for exclusive content from top finance leaders worldwide? Our [Insider membership](https://www.financealliance.io/insider-membership-plan/)'s got you covered; and, for hours of ondemand videos plus even a free ticket to one of our events (and more), why not check our [Pro](https://www.financealliance.io/pro-membership/) and [Pro+](https://www.financealliance.io/pro-plus-membership/) subscriptions? [Free Finance Alliance Membership - Become an InsiderJoin 1,000s other finance professionals and test drive your Finance Alliance membership without spending a dime.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-389.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Membership_Meta_Images_3-3.png)](https://www.financealliance.io/insider-membership-plan/) ### CFO Summit: Speaker Spotlight with Rob Seifert URL: https://www.financealliance.io/cfo-summit-speaker-spotlight-with-rob-seifert/ Last updated: 2026-02-23T08:36:18.000Z The [**CFO Summit** is on the horizon](https://cfoevents.financealliance.io/location/cfosanjose/), and we’re excited to feature **Rob Seifert**, Senior Director at the SAP S/4HANA Cloud Center. With over 30 years of experience at the intersection of business, finance, and [SAP](https://www.sap.com/index.html), Rob is a trusted advisor to CFOs navigating the shift from legacy systems to connected, automated, and insight-driven enterprises. In his upcoming session, **“**[**Defining 2026: The five decisions that will shape finance leadership**](https://cfoevents.financealliance.io/location/cfosanjose/agenda)**,"** Rob will address a critical question: *How can CFOs transform their finance organizations to lead with confidence in an era of volatility, abundant data, and rising expectations?* Drawing on his deep expertise, Rob will explore the decisions that close the gap between ambition and execution, helping finance teams spend less time defending numbers and more time driving outcomes. We sat down with Rob to discuss his session, the evolving role of the CFO, and why this moment is pivotal for finance leaders. [Request your invite to the CFO Summit](https://cfoevents.financealliance.io/location/cfosanjose/) ## **About Rob Seifert** Rob Seifert is a Senior Director at SAP focused on Cloud ERP, where he partners with CFOs to modernize finance operations, balancing growth, control, and risk. As a hands-on finance partner, program sponsor, and executive advisor, Rob has guided senior leaders through the critical decisions required to transition from fragmented legacy environments to integrated, automated, and insight-driven enterprises. His work is rooted in the belief that finance leadership is central to enterprise resilience and growth. --- ## **A conversation with Rob Seifert** ### **What sparked this session?** CFOs are no longer asking “Should we transform?” They’re asking “How do we make faster calls without increasing risk?” They’re being pushed to run more scenarios, answer the board faster, and navigate cost pressure with flatter teams. But too many finance organizations are still spending too much time reconciling data, explaining variances, and stitching information together. This session is about the decisions that close that gap, so finance can spend less time defending numbers and more time driving outcomes. ### **How has the CFO role changed and what hasn’t changed enough?** The biggest change is that CFOs are now expected to be enterprise decision leaders, co-owning strategy, investment tradeoffs, and risk posture in real time, not after the fact. What hasn’t changed enough is the system behind the numbers. Too many teams are still operating with fragmented data, manual controls, and processes that make it hard to answer basic questions quickly, like “What’s the margin impact if demand shifts 3%?” or “Where is working capital tightening?” The mandate moved faster than the mechanics of finance, and that mismatch is where a lot of stress comes from. ### **What’s at stake if finance leaders delay transformation?** What’s at stake isn’t just efficiency, it’s credibility and influence when it matters most. When volatility hits, the board doesn’t want a spreadsheet debate. They want a defensible answer. What’s happening, why, and what we are doing about it. If finance can’t close quickly, trace assumptions, or produce audit-grade reporting without heroics, you end up reacting instead of leading. Delaying transformation doesn’t keep your choices open, it raises the odds that the next disruption will force rushed decisions. CFOs who act earlier create breathing room to lead deliberately instead of operating in emergency mode. ### **Why is trust fragile even with abundant data?** Confidence doesn’t come from having more data but from being able to explain and stand behind the answer. Many organizations have plenty of dashboards, but the underlying data isn’t always consistent across systems, and the path from source transaction to board metric isn’t always clear. When numbers don’t reconcile quickly or assumptions can’t be traced, trust erodes. AI amplifies this: it can accelerate insight and productivity, but only if your foundation is solid. Clean master data, clear controls, and transparency into how outputs were produced. Without that, AI can move faster than your ability to validate it, and that creates hesitation instead of confidence. [Request your invite](https://cfoevents.financealliance.io/location/cfosanjose/) ### **What external pressures are CFOs underestimating?** I think leaders are underestimating how quickly these pressures are converging. It is not just macro volatility. It’s also pricing pressure, supply and tariff uncertainty, rising expectations around cyber and disclosure readiness, and new governance expectations as AI touches finance processes. These are not separate work streams anymore. They collide in planning, close, controls, and reporting at the same time. So the real challenge is not predicting the next disruption. It’s building a finance engine that can adapt, enabling faster scenario planning, tighter controls, and decision ready data without weeks of rework. ### **What are your reasons for supporting the CFO Summit?** I supported this event because it is a room full of people dealing with the same real problems. CFOs are being asked to move faster, explain more, and take on more risk at the same time. I’m here because I learn a lot from how CFOs are tackling that, and I can share what I am seeing work in the field. ### **What are you most looking forward to?** I am looking forward to what people are willing to share about what worked and what didn’t. CFOs are dealing with the same tension right now. Move faster, keep controls tight, and still fund growth. I want to hear where leaders are seeing real payoff and where they are still hitting friction. Whether teams are spending too much time reconciling data, forecasting takes too long, or teams are stretched thin. ### **What does this partnership mean to your company?** It reflects a shared belief that finance leadership is central to enterprise resilience and growth. For us, this partnership is about helping CFOs build trust in the numbers, speed in decision making, and strength in governance so finance can lead confidently through uncertainty. When CFOs have that foundation, the whole organization moves faster and with less risk. --- ### **Who is SAP?** SAP helps CFOs manage complexity and lead with confidence by connecting business processes, data, and AI across the enterprise. Through its integrated business suite, SAP brings finance, supply chain, procurement, HR, and operations together on a shared data foundation, giving finance leaders real time visibility into performance, risk, and opportunity. A connected and complete data foundation is critical as finance teams scale automation and AI. SAP helps ensure business data is consistent, contextual, and grounded in common business meaning, so insights can be trusted and acted on. By embedding intelligence directly into business processes, SAP enables CFOs to improve productivity, maintain strong governance, and respond more effectively to economic and regulatory change. --- **Want to connect with Rob or learn more?** Rob is always eager to engage with finance leaders and share insights. You can connect with him on [LinkedIn](https://www.linkedin.com/in/rob-seifert/) or reach out through SAP’s official channels. --- ## **CFO Summit in San Jose** Don’t miss your chance to connect with pioneering finance leaders and shape the future of your organization. The **CFO Summit San Jose** brings together CFOs and senior finance executives who are designing next-gen operating models, securing long-term performance, and navigating the same transformation challenges you face every day. **Ready to lead with confidence?** [Register now](https://cfoevents.financealliance.io/location/cfosanjose/) to secure your spot at the CFO Summit San Jose. Can’t attend in person? [Virtual tickets](https://cfoevents.financealliance.io/location/cfosanjose/registervirtual) give you access to all live sessions, on-demand content, exclusive frameworks, and member-only events. Your future in finance starts here. [Register your interest today](https://cfoevents.financealliance.io/location/cfosanjose/) ### Why most AI projects in finance fail, with Abhishek Chandna [Video] URL: https://www.financealliance.io/podcast/why-most-ai-projects-in-finance-fail-with-abhishek-chandna-video/ Last updated: 2026-02-19T10:00:36.000Z _No content available._ ### Is your FP&A team just reporting the past? [Video] URL: https://www.financealliance.io/podcast/is-your-fp-a-team-just-reporting-the-past-video/ Last updated: 2026-02-17T14:53:51.000Z _No content available._ ### CapEx vs OpEx: Key differences, examples & why it matters URL: https://www.financealliance.io/capex-vs-opex/ Last updated: 2026-02-17T12:09:37.000Z If you've ever had to [plan a budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), make a big purchase, or justify expenses to leadership, you've probably come across the terms CapEx (Capital Expenditure) and OpEx (Operating Expenditure). But what do they really mean and why does understanding CapEx vs OpEx matter for your bottom line? Understanding the difference between CapEx vs OpEx can shape how your business spends money, [manages cash flow](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/), and even scales over time. In this article, we’ll break down the key differences, look at real-world examples, and help you figure out when to choose one over the other. ## **What is CapEx vs OpEx?** At a high level, CapEx (Capital Expenditure) and OpEx (Operating Expenditure) are two ways businesses spend money, but they serve very different purposes. CapEx refers to the money a company invests in acquiring, upgrading, or maintaining long-term assets. These are the big purchases like buildings, vehicles, heavy machinery, or new [technology systems](https://www.financealliance.io/15-best-fp-a-tools-and-software/). These are long-lasting investments that show up on the balance sheet and are paid off (on paper) slowly over time. On the flip side, OpEx covers the day-to-day costs of running a business. These are operating expenses that keep the lights on and the wheels turning. This includes things like salaries, rent, utilities, marketing, and supplies. Operating expenses are recurring, more flexible, and fully deducted in the period they’re incurred. In short: ****CapEx** \= Big, long-term investment. Slower to impact your books. ****OpEx** \= Everyday spending. Fast, flexible, and hits your books right away. If you’re still unsure about which is which, ask yourself this question: “*Is this something I’ll use for years, or just something I need to keep things going right now?*” If it’s long-term, it’s CapEx. If it’s month-to-month, it’s OpEx. ## **Capitalization thresholds (and why they vary)** There is no universal dollar amount that determines whether an expense should be capitalized. Every company sets its own capitalization threshold as part of its [accounting](https://www.financealliance.io/fp-a-vs-accounting-key-differences-every-finance-pro-should-know/) policy, and that threshold depends on factors like company size, industry norms, materiality considerations, and auditor guidance under GAAP or IFRS. In practice, small businesses often set thresholds between $500 and $2,500, which reflects their tighter [budgets](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) and the relative significance of smaller purchases. Mid-market companies typically land somewhere in the $2,500 to $10,000 range, while large enterprises may push their thresholds even higher because a $5,000 purchase simply doesn't move the needle on their financial statements. But here's where it gets interesting: the dollar amount alone doesn't tell the whole story. Aggregation matters. If you purchase twenty laptops at $800 each in a single order, that $16,000 batch may well exceed your threshold and warrant capitalization, even though each individual unit falls below it. Similarly, the nature of the expenditure can override dollar considerations entirely. A repair that merely maintains an asset's current condition is typically expensed regardless of cost, while an improvement that extends useful life or increases value may be capitalized even if it falls near your threshold. When evaluating whether to capitalize, consider these key questions: Does the item have a useful life greater than one year? Does it increase the asset's value or extend its productive life? Is the amount material to your financial statements? And does your organization's approval process treat this as a capital request requiring different authorization than routine expenses? Your capitalization policy should document these criteria clearly, and you should apply them consistently. Auditors will look for that consistency, and your finance team will thank you when year-end closes roll around. [FP&A career path and salary guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-376.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--10-.png)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) ## **Examples of capital expenditures** So, what actually counts as a capital expenditure? Let’s look at some real examples to make it clear which kinds of business expenses fall into the CapEx bucket. ### **Property and buildings** Purchasing land, constructing a new facility, or acquiring an office space all fall under CapEx. Even significant renovations or extensions to existing buildings qualify, since they increase the value or extend the life of the property. ### **Equipment and machinery** For companies in manufacturing, logistics, healthcare, or construction, large-scale equipment is a typical capital expense. This includes items like production machinery, medical devices, commercial ovens, or forklifts, etc. Basically anything that plays a critical role in operations and lasts multiple years. ### **Technology and hardware** When a company upgrades its computer systems, buys a new fleet of laptops, or installs new servers, those costs are treated as CapEx. These purchases support [business operations](https://www.financealliance.io/operational-analysts-why-they-belong-in-finance-not-it-or-business-units/) over the long term and aren’t part of the regular monthly budget. [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-377.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--14.png)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) ### **Vehicles for business use** Company-owned vehicles used for deliveries, transportation, or field service are capital expenses. This includes delivery vans, sales fleet cars, or even electric trucks purchased as part of a sustainability initiative. ### **Renovations and infrastructure upgrades** Major improvements (like updating HVAC systems, rewiring an entire office, or installing solar panels) also count as [capital expenditures](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/). These upgrades extend the useful life or enhance the value of existing assets. ### **Real estate rentals: CapEx vs OpEx examples (and why NOI changes)** For property investors and managers, the CapEx versus OpEx distinction directly affects how you calculate Net Operating Income (NOI) and, ultimately, how you value a property. Getting this classification right matters for accurate [financial reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) and for understanding your true cash position. Common CapEx items in rental properties include roof replacements, HVAC system installations, full kitchen remodels, and major plumbing or electrical upgrades. These expenditures create lasting value, extend the property's useful life, and get capitalized on your balance sheet before being depreciated over time. OpEx items, by contrast, include routine maintenance like landscaping, cleaning between tenants, minor repairs, and regular servicing of existing systems. These costs hit your income statement immediately and reduce your NOI in the current period. The operational implication is significant. When you classify something as OpEx, your reported net income drops right now. When you capitalize it, the expense spreads across multiple years through depreciation, which means your current-period NOI looks stronger even though you've spent the same cash. Neither approach changes the total economic cost over the asset's life, but the timing affects everything from loan covenants to investor distributions. Gray areas pop up constantly in property management. Patching a section of roof is typically OpEx, but replacing the entire roof is CapEx. Repainting a unit after normal wear is OpEx, while a full renovation that upgrades finishes and increases rental value leans toward CapEx. Replacing a single appliance might be expensed, but outfitting an entire building with new appliances could warrant capitalization. Document your reasoning for borderline items. Keep records of the scope of work, the expected useful life of improvements, and how the expenditure affects the property's value or functionality. Your accountant and your auditors will appreciate the clarity, and you'll have defensible positions if questions arise later. ## **How to calculate CapEx** To calculate CapEx, you don’t need a finance degree, just the right numbers. ![Capex formula](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/07/capex-formula.png) Here’s the CapEx formula: > *CapEx = (PP&E (prior period) - PP&E (current period)) + Depreciation (current period)* **PP&E** \= Property, Plant, and Equipment (from the balance sheet) **Depreciation** \= Total depreciation for the period (from the cash flow statement) ### **CapEx calculator** Use this quick CapEx calculator to get an instant estimate. Just plug in your current and previous PP&E (Property, Plant & Equipment) values and your total depreciation for the period. The calculator will do the math for you. ### CapEx Calculator Current PP&E ($): Previous PP&E ($): Depreciation ($): Calculate CapEx **CapEx:** – ## **Examples of OpEx** OpEx are the regular, ongoing costs a business needs to stay up and running day-to-day. Unlike CapEx, these costs don’t create long-term value or assets, they're the fuel that keeps everything moving, month after month. Here are some of the most common examples: ### **Salaries and wages** Paying your team is one of the most consistent operating expenses. This includes not just base salaries, but also bonuses, overtime, and any employee benefits that are paid regularly. ### **Rent and utilities** Whether you lease office space, a storefront, or a warehouse, that monthly rent payment is an operating expense. Same goes for utility bills like electricity, water, internet, and heating. ### **Marketing and advertising** Marketing expenses like Facebook ads, hiring freelance copywriters, paying for trade show booths, etc. represent a major chunk of OpEx. These are recurring or campaign-based costs tied to promoting the business. ### **Software subscriptions** Most businesses today rely on SaaS tools like CRM platforms, project management apps, cloud storage, accounting software, etc. These monthly or annual subscription fees are classic examples of operating expenses. ### **Office supplies and materials** This includes everything from pens and printer ink to packaging materials and cleaning supplies. If it’s something you buy regularly to keep the business functioning, it’s OpEx. ### **Insurance and professional services** Business insurance, legal fees, accountant retainers, and consulting services are all considered operating expenses too, especially if they’re part of your ongoing operations. ### **Small business examples: quick cheat sheet** Small businesses face the same CapEx versus OpEx decisions as larger companies, but the specific items look different when you're running a restaurant, a retail shop, or a professional services firm. Here's a practical breakdown tailored to smaller operations. Typical small business CapEx includes point-of-sale system hardware, commercial kitchen equipment, company vehicles, leasehold improvements to rented spaces, and computers or laptops that exceed your capitalization threshold. These purchases create lasting value, show up as assets, and get depreciated over their useful lives. Common small business OpEx covers rent payments, payroll and contractor fees, bookkeeping and accounting services, marketing and advertising spend, SaaS subscriptions for tools like QuickBooks or Mailchimp, utilities, insurance premiums, and office supplies. These recurring costs keep operations running and get expensed in the period you incur them. Gray areas trip up small business owners regularly. Website development often falls into this category: a simple informational site might be expensed, while a complex e-commerce platform with custom functionality could warrant capitalization. Major repairs versus routine maintenance present another common question, where the answer depends on whether the work extends useful life or merely maintains current condition. Laptops that fall below your threshold get expensed even though they'll last several years. Implementation fees for new software might be capitalized if they create a separable asset with lasting value, or expensed if they're essentially setup costs for a subscription service. The general rule of thumb: if you're buying something that will serve the business for multiple years and represents a material investment relative to your size, lean toward capitalization. If it's a recurring cost or a one-time expense that doesn't create lasting value, expense it. When you're genuinely uncertain, document your reasoning and discuss the treatment with your accountant before closing the books. ## **How to calculate Opex** Calculating OpEx is simpler than CapEx because you’re just adding up the regular, recurring expenses that keep the lights on. ![OpEx formula](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/07/Opex-formula.png) Here’s the basic formula: > *OpEx = COGS (cost of goods sold) + Operating expenses* ### **OpEx calculator** Want to get a quick snapshot of your business’s operating expenses? Enter your main costs below (like salaries, rent, and marketing), and we’ll crunch the total for you. ### OpEx Calculator Salaries & Wages ($): Rent & Utilities ($): Marketing & Advertising ($): Software & Subscriptions ($): Calculate OpEx **Total OpEx:** – ## **Pros and Cons of CapEx vs OpEx** Knowing the difference between CapEx vs OpEx is one thing, but understanding the *trade-offs*? That’s where the real decision-making happens. Let’s break it down. ### **CapEx: Capital expenditure** ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/07/Pros-and-cons-of-CapEx.png) ### 👍 Pros - **Builds long-term value:** CapEx investments (like property or equipment) become assets that hold value on your balance sheet. - **Can reduce taxable income over time:** Through depreciation, you spread the cost over multiple years, which is great for long-term financial planning. - **Strategic and scalable**: Major purchases lay the groundwork for future growth and expansion. ### 👎 Cons - **High upfront cost**: These aren’t light purchases. You’ll need serious cash (or financing) to make them happen. - **Less flexible**: Once you invest, you’re locked in. You can’t easily walk away from a building or machinery. - **Slower ROI**: Because these are long-term assets, it can take years before the benefits truly show up in your bottom line. ### **OpEx: Operating expenditure** ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/07/Pros-and-cons-of-OpEx.png) ### 👍 Pros - **Flexible and scalable**: OpEx gives you the freedom to scale expenses up or down based on current needs. - **Immediate tax benefit**: You can usually deduct OpEx in the year it’s incurred, so no need to wait around for depreciation schedules. - **Lower barrier to entry**: Subscriptions and rental models mean you can access tools and services without large upfront investment. ### 👎 Cons - **No long-term asset**: OpEx spending keeps things running, but it doesn’t build owned value over time. - **Recurring costs can pile up**: What feels small month-to-month can add up quickly if not managed closely. - **Potential for vendor lock-in**: With SaaS or rental models, you may be stuck with ongoing payments, even if your needs change. [10 tips to eliminate forecast biasNo matter how sophisticated our models get, forecast bias has a sneaky way of slipping into our financial plans. If you want to stop forecast bias from creeping in, here are 10 practical ways to put an end to it.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-159.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--5--2.png)](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) ### **Modern example: moving from on-prem servers (CapEx) to cloud (OpEx)** The shift from on-premises infrastructure to cloud services represents one of the clearest modern examples of the CapEx-to-OpEx transition. When you build your own data center or purchase servers, you're making a [capital investment](https://www.financealliance.io/multiple-on-invested-capital-moic/). You own the hardware, depreciate it over three to five years, and carry it as an asset on your balance sheet. When you move to AWS, Azure, or GCP, those monthly usage fees typically flow through as operating expenses, hitting your income statement in the period incurred. This distinction affects more than just accounting treatment. Consider the cash flow implications: a $200,000 server purchase requires that capital upfront, whether you finance it or pay cash. A comparable cloud deployment might cost $9,000 per month, spreading the expense over time and preserving cash for other priorities. The cloud model also offers elasticity, meaning you can scale usage up or down based on actual demand rather than planning capacity years in advance. From a governance perspective, the approval processes differ substantially. CapEx purchases often require board approval, detailed ROI analysis, and procurement cycles that can stretch for months. OpEx cloud spending typically falls under departmental budgets with faster approval paths, though this flexibility requires disciplined cost monitoring to prevent runaway spending. The trade-off involves predictability versus ownership. With on-prem infrastructure, you control the asset and your costs become more predictable after the initial investment. With cloud services, you gain flexibility but accept variable costs that can surprise you if usage spikes unexpectedly. One important caveat: specific contract terms can change the accounting treatment. Multi-year cloud commitments with upfront payments or certain reserved instance arrangements may have characteristics that require different classification. Always confirm the treatment with your finance team based on the actual contract structure. [How generative AI is transforming financeFinancial advisors could use AI to generate initial investment recommendations while focusing their expertise on understanding client needs and providing personalized guidance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-378.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--9--1.png)](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) ## **Differences between Capex and OpEx** CapEx and OpEx aren’t just accounting terms, they affect how a business spends money, reports financials, plans for taxes, and drives growth. Here’s how they compare across the areas that count. ### 1\. Type of investment - **CapEx**: Big, long-term investments like property, equipment, or infrastructure. You’re buying something you’ll use for years. - **OpEx**: Day-to-day operational spending such as rent, payroll, marketing, or software subscriptions. It keeps the lights on and the business moving. ### 2\. How it’s recorded on financial statements - **CapEx**: Shows up as an **asset** on the balance sheet. Instead of expensing it right away, it’s capitalized and depreciated over time. - **OpEx**: Appears as a regular **expense** on the income statement. It directly reduces net income in the same period it’s incurred. ### 3\. Tax treatment - **CapEx**: Can’t be fully deducted in the year it’s spent. Instead, it’s depreciated (or amortized for intangible assets) over the asset’s useful life. - **OpEx**: Fully tax-deductible in the year the expense happens. This helps reduce taxable income right away. ### 4\. Depreciation methods (for CapEx only) CapEx is depreciated using methods like: - **Straight-line** (spreads the cost evenly over time). - **Declining balance** (accelerates depreciation earlier in the asset’s life). This helps spread out the tax impact of large purchases over several years. ### 5\. Impact on cash flow - **CapEx**: Big hit to cash flow when the asset is purchased and can impact liquidity in the short term. - **OpEx**: Smaller, predictable outflows that are easier to manage month-to-month. ### 6\. Business strategy & benefits - **CapEx**: Supports long-term growth. Great for companies investing in expansion, infrastructure, or improving efficiency. - **OpEx**: Offers more flexibility. Ideal for businesses that prioritize agility, cost control, and short-term responsiveness. --- ### FAQs: OpEx vs CapEx What is the difference between OpEx and CapEx? OpEx (Operating Expenditure) refers to the ongoing costs of running a business on a day-to-day basis, like salaries or utility bills, while CapEx pertains to one-time investments in long-term assets. Typically, CapEx adds value to the company's balance sheet as it's treated as an asset, whereas OpEx is treated as an expense affecting the profit and loss statement. What is a capital expense? A capital expense (CapEx) is money a business spends on long-term assets like buildings, equipment, or vehicles, etc. - basically, things it plans to use for more than a year. Is CapEx same as working capital? No, CapEx and working capital are different. While CapEx refers to long-term investments in assets, working capital refers to the short-term liquidity available to a business, calculated as current assets minus current liabilities. Is depreciation an operating expense? No, depreciation isn't considered an operating expense. It’s a non-cash accounting method used to spread the cost of a capital asset over its useful life. What is undepreciated capital cost? Undepreciated capital cost (UCC) refers to the remaining book value of an asset after accounting for depreciation already claimed. It’s often used in tax calculations. What is CapEx in finance? In finance, CapEx (Capital Expenditure) refers to the funds used by a company to buy, upgrade, or maintain physical assets that support long-term growth. What is OpEx in finance? In finance, OpEx refers to the costs associated with a company's regular, daily operations, like wages and rent, which directly impact the profit and loss statement. Is software CapEx or OpEx? Software can be CapEx or OpEx depending on how it’s acquired. One-time purchases or custom-built software are typically CapEx, while cloud-based subscriptions (SaaS) are usually OpEx. What’s included in capital requests? Capital requests usually include a detailed breakdown of the proposed asset purchase, total cost, expected ROI, depreciation schedule, and how it supports business goals. What is a good CapEx ratio? A good CapEx ratio (like CapEx to revenue) varies by industry, but generally, lower ratios mean more efficient use of capital. For capital-intensive industries, higher ratios are normal. What does CapEx tell you about a company? CapEx spending gives insight into a company’s growth strategy. High CapEx often signals expansion or investment in infrastructure, while low CapEx may indicate stability or cost control. What is a good OpEx percentage? A good OpEx percentage (OpEx as a percentage of revenue) depends on your industry. Generally, keeping operating expenses under 60–70% of revenue is a healthy target for most businesses. --- ### **Ready to take your finance career to the next level?** Hundreds of finance pros have joined our [**Insider Membership**](https://www.financealliance.io/insider-membership-plan/) to get early access to exclusive content, smart tools, and the kind of advice you won’t find on Google. It’s free, easy, and made for people like you. [Become an Insider (it's free)](https://www.financealliance.io/insider-membership-plan/) ### Multiple on Invested Capital (MOIC): Definition & guide URL: https://www.financealliance.io/multiple-on-invested-capital-moic/ Last updated: 2026-02-17T10:33:15.000Z Ever struggled to explain an investment's true value to a client or stakeholder? It can be hard to communicate the impact of potential or even existing [investments](https://www.financealliance.io/10-structured-capital-strategies/) *without* a clear understanding of **Multiple on Invested Capital (MOIC)**. This important metric cuts through the jargon and reveals the true return on investment. MOIC serves as a crucial indicator of investment success, offering a solid foundation for making well-informed financial decisions. In this article, we’re zeroing in on MOIC to uncover what it is, its role in [private equity](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/) (PE), and more importantly, how you can use it to sharpen your investment evaluation skills. #### Key takeaways 👇 - MOIC measures how many times your investment has paid off, making it a clear and simple way to see an investment's success. - It doesn’t consider how long it takes to see returns, unlike metrics like IRR, so it’s best used alongside other measures. - A high MOIC signals a profitable investment, often influencing further funding and investment decisions. ## **What is MOIC?** MOIC stands for "Multiple on Invested Capital” – a [financial metric](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) used to evaluate the **value of an investment** relative to the **initial capital** invested. It’s worth noting that the term MOIC is often interchangeable with terms like *cash-on-cash return* and *multiple on money (MoM)*. If we were to define MOIC in simple terms, we’d sum it up as a ratio to help determine the potential return on investment. It does this by calculating how many times the initial investment (cost) will be returned. Both profits and losses are included. > MOIC is calculated by dividing the **total value** (current or projected) of an investment by the **initial capital invested**. For example, if an investor puts $100,000 into a project and expects to receive $300,000 in returns, the MOIC would be 3.0 (300,000 / 100,000). ****Note:** A higher MOIC typically indicates a more attractive investment opportunity because it points to a greater return relative to the initial cost. ## **What is MOIC in private equity?** MOIC is widely used in [private equity](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/), venture capital, and other investment sectors to evaluate and compare different investment opportunities. It provides a straightforward way to assess the potential [profitability](https://www.financealliance.io/profit-planning/) and efficiency of an investment relative to the capital required. This makes MOIC private equity a simple yet powerful way to see if an investment is worth it. But what exactly does MOIC tell you about private equity? There are three key insights: **1\. Performance:** A high MOIC proves the fund is generating strong returns for its investors. **2\. Comparison:** It allows you to compare the [performance](https://www.financealliance.io/flexible-budget-performance-report/) of different investments or funds. **3\. Potential:** By analyzing the MOIC of past investments made by a fund, you can get a sense of their potential for future deals. [How to optimize capital deployed for sustainable growthTo truly drive growth, you need to master the art of strategic capital deployment. Our guide will help you to optimize the capital deployed and help transform your financial strategy into a powerful catalyst for real business growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-369.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Stock--2--2.png)](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/) ## **What is the average MOIC in private equity?** There isn't a single, universally accepted "average" MOIC for private equity. However, some sources report that a MOIC of [2.0x or higher](https://www.ibankingadvice.com/post/moic-private-equity#:~:text=A%20low%20MOIC%20is%20usually,than%203.0x%20or%20higher.) is generally a “*good benchmark for investment performance in private equity*.” Of course, it’s still difficult to land on a concrete number. For one thing, the year an investment is made (vintage year) significantly impacts the MOIC. A fund launched during a booming economic period might have a higher average MOIC compared to one launched during a recession. Not only that, but different private equity funds have different investment strategies (e.g., growth capital, buyouts). These strategies can lead to different average MOICs. Risk profiles also vary. [Higher-risk investments](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) typically have the potential for a higher MOIC, but also come with a greater chance of failure. ***Remember:** *MOIC is just one metric. A comprehensive evaluation of a private equity investment should consider factors like the fund's management team, investment strategy, and risk profile.* ## **What's considered a good MOIC in private equity?** The 2.0x benchmark you'll often hear cited in private equity circles serves as a reasonable baseline, but context matters enormously. For traditional buyout funds, a 2.0x to 2.5x net MOIC over a typical five-to-seven-year holding period generally signals solid performance. Growth equity strategies, which take on different risk profiles and often involve minority positions, might target slightly higher multiples (think 2.5x to 3.0x) to compensate for the additional uncertainty. Vintage year plays a significant role here. Funds that deployed capital during favorable market conditions (lower entry valuations, accessible credit) tend to produce higher MOICs than those investing at cycle peaks. A 2.0x multiple from a 2009 vintage fund tells a different story than the same multiple from a 2021 vintage. ### **What's considered a good MOIC in venture capital?** Venture capital (VC) operates under entirely different return dynamics. The power-law nature of VC means most investments return little or nothing, while a small number of winners drive fund performance. At the deal level, VCs often target 10x or higher on individual investments, knowing that many will fail entirely. At the fund level, however, a 3.0x net MOIC is generally considered strong performance, and top-quartile funds might achieve 4.0x or higher. The dispersion in VC outcomes is much wider than in PE. A buyout fund rarely sees a single investment return 50x, but that's precisely what venture investors hope for from their best bets. This makes comparing VC and PE MOICs directly somewhat misleading without understanding the underlying strategy. ### **How to use benchmarks responsibly** MOIC [benchmarks](https://www.financealliance.io/32-cfo-kpis/) provide useful reference points, but they can mislead if used in isolation. A 3.0x MOIC over ten years looks different from a 3.0x over four years, the latter represents far better capital efficiency. Always pair MOIC with time-based metrics like IRR when possible. Additionally, consider realization status: a fund showing 2.5x with most of that value still unrealized carries more uncertainty than one showing 2.0x that's largely distributed. DPI (distributions to paid-in capital) helps you understand how much of that multiple has actually been returned to investors versus sitting on paper. ## **MOIC formula and calculation** ### **How to calculate MOIC** Calculating MOIC is quite straightforward. You simply **divide the total value** you get back from your investment by the **original amount** you put in. The MOIC calculation gives you a clear number showing how many times your investment has paid off. Here's the MOIC formula: ![MOIC formula](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/MOIC-formula.png) MOIC formula Here's a breakdown of the terms: **Total value of investment:** This includes *all* the **cash** received from the investment, such as dividends, profits, and the eventual sale proceeds. It also considers the **unrealized gains**, which is the potential future value of the investment if it were sold today. **Total invested capital:** This is the **total amount** of money initially invested in the deal. ### **MOIC calculation in 3 steps** Sometimes the clearest way to understand a formula is to walk through it with the simplest possible numbers. Here's a minimal example you can follow along with a calculator. **The Setup:** You invest $50,000 in a company. Over the next few years, you receive two cash distributions: $20,000 from a dividend and $40,000 when the company is partially sold. You still hold shares worth $30,000 at current fair value. **Step 1: Calculate total value** Add up everything you've received plus what your remaining stake is worth today. $20,000 (dividend) + $40,000 (partial sale proceeds) + $30,000 (current fair value of remaining shares) = **$90,000** **Step 2: Identify invested capital** This is simply the cash you originally put in: **$50,000** **Step 3: Divide to Get MOIC** $90,000 ÷ $50,000 = **1.8x** **What This Means:** A 1.8x MOIC tells you that for every dollar you invested, you've received (or currently hold) $1.80 in value. You haven't doubled your money yet, but you're well on your way, assuming that remaining $30,000 in fair value holds or grows. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-370.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-14.png)](https://www.financealliance.io/financial-charts-and-graphs/) A few things to keep in mind as you run your own calculations. The total value figure combines both realized returns (cash you've actually received) and unrealized value (what your remaining position is worth on paper). If you want to know your realized MOIC specifically, you'd exclude that $30,000 fair value and calculate $60,000 ÷ $50,000 = 1.2x. That distinction matters when you're reporting to [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) who want to know what's been locked in versus what's still at risk. The arithmetic here is intentionally simple. In practice, you might have multiple follow-on investments, various distribution types, and complex valuation methodologies. But the core logic never changes: sum up what you've gotten back and what you still hold, divide by what you put in, and you have your multiple. ### **What counts as total value vs. invested capital?** Getting the MOIC formula right depends entirely on what you include in each component. Sounds simple, but this is where most calculation errors happen. **Include in total value:** [Cash distributions](https://www.financealliance.io/cash-flow-drivers-in-a-business/) received, sale proceeds from partial or full exits, current NAV or fair market value of remaining holdings. **Include in invested capital:** Initial investment amount, any follow-on capital contributions, transaction costs directly tied to acquiring the position. **Exclude:** Uncalled commitments, management fees (unless calculating net MOIC), and any value already counted in distributions if you're also counting remaining fair value. **A few common mistakes trip people up regularly:** - Using committed capital instead of called capital inflates your denominator and understates your multiple. - Mixing gross and net figures (say, using gross value in the numerator but net invested capital in the denominator) creates an apples-to-oranges comparison. - And after a partial sale, some analysts accidentally double-count by including both the sale proceeds and the pre-sale fair value. Once you've distributed cash, that portion moves out of unrealized value and into realized distributions. Keep these categories clean, and your MOIC will actually mean something. [Cash runway calculator (plus 5 tips to extend your cash runway)Discover five strategies to improve your cash runway and ensure business continuity. Plus, we’ve included a free cash runway calculator to quickly determine your company’s cash runway.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-371.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--5--5.png)](https://www.financealliance.io/cash-runway-calculator/) ## **Examples of calculating MOIC with the formula** Let's put the calculating MOIC formula into practice with a couple of scenarios: ### **Scenario 1: You invest $1 million in a startup.** After a few years, the company is acquired for $5 million, and you receive your share of the proceeds. In this case, your total value of investment would be $5 million (acquisition proceeds). Since you initially invested $1 million, the MOIC would be: ![MOIC calculation example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/MOIC-calculation.png) The MOIC calculation indicates a very successful investment, generating a fivefold return on your initial capital. ### **Scenario 2: A private equity fund invests $100 million in a company.** Over a five-year holding period, the fund receives $20 million in dividends and ultimately sells the company for $120 million. Here, the total value of investment would be $20 million (dividends) + $120 million (sale proceeds) = $140 million. So, the MOIC formula would be: ![Calculate MOIC example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/MOIC.png) It’s a more modest return, but it's important to consider factors like the holding period and the overall investment strategy of the fund. ### **Calculating MOIC for a portfolio or fund (aggregation)** The core MOIC formula stays the same whether you're measuring a single deal or an entire portfolio. What changes is how you assemble the inputs. Instead of tracking one investment's [cash flows](https://www.financealliance.io/cash-flow-drivers-in-a-business/), you're summing across multiple positions, and that requires consistency in timing and treatment. Here's a five-step method for calculating portfolio-level MOIC: **Step 1:** Establish a single valuation date. Every unrealized position in the portfolio needs to be marked to fair value as of the same date. Using stale valuations for some holdings while others are current creates a distorted picture. **Step 2:** Sum all distributions received across deals. This includes dividends, interest, and proceeds from partial or full exits, everything that has been returned to the fund or LP. **Step 3:** Sum the current fair value of all remaining holdings. For partially exited positions, include only the remaining stake's fair value, not the portion already distributed. **Step 4:** Add Steps 2 and 3 to get total value for the portfolio. **Step 5:** Sum all paid-in capital across deals. This is your invested capital. Divide total value by invested capital to get portfolio MOIC. [EBITDA calculator & guide to what it really tells youIn this simple guide, we’ll break it all down: what EBITDA is (and isn’t), how it compares to EBITA, when to use it, and we’ll also include a free EBITDA calculator you can use right away.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-372.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/EBITDA-calculator-3.png)](https://www.financealliance.io/ebitda-calculator-guide/) ## **Unrealized vs. realized MOIC** When discussing MOIC, it's important to distinguish between unrealized and realized MOIC. ### **Unrealized MOIC** This is like a progress report. It uses the current value of your investment (*think market price for a stock or an expert's guess for a company*) to estimate how much you might get back if you cashed out today. It's a good way to track how your investment is doing over time, but it's not guaranteed - the value could go up or down before you sell. ### **Realized MOIC** Realized MOIC is calculated only after you've completely sold your investment and received all the money. This is the true picture of how much money you made (or lost) on the investment. The key difference is that unrealized MOIC is a forecast or estimate, while realized MOIC is the definitive, actual return on investment. ![MOIC - unrealized and realized](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/MOIC-investor.png) ## **What's the difference between MOIC and IRR?** The key difference between MOIC and IRR (Internal Rate of Return) lies in how they measure and express investment returns. They’re both [important metrics](https://www.financealliance.io/32-cfo-kpis/) to assess the performance of an investment, but they approach it differently. **MOIC** focuses purely on the **total return**, telling you how much the investment has grown compared to what you initially put in. **IRR**, on the other hand, measures the **annualized rate of return** on an investment. It considers the timing of cash flows, providing a more comprehensive view of an investment's performance over time. ### **When to use MOIC vs. IRR (practical decision guide)** Both MOIC and IRR have their place in investment analysis, but they answer different questions. Knowing when to emphasize each metric helps you communicate more effectively with stakeholders and make better-informed decisions. As Christopher Toumajian, a finance executive, notes when discussing financial oversight: > "Understanding what metric is right for your industry is certainly sort of step one when you're talking about valuation." He points out that private equity-backed companies often focus on MOIC, while other contexts might prioritize IRR or DCF approaches. **Use MOIC when:** You need a quick, intuitive measure of how much an investment has [grown](https://www.financealliance.io/podcast/scalable-growth-strategy/). MOIC works well for comparing the magnitude of outcomes across deals: did this investment double, triple, or return five times the capital? It's particularly useful in early-stage or mark-to-market contexts where timing is uncertain and you want to track value creation without getting tangled in cash flow timing assumptions. MOIC also shines in LP communications when you want to convey the overall scale of returns in straightforward terms. **Use IRR when:** Time matters. If you're comparing investments with different holding periods, IRR accounts for how quickly capital was returned. A 2.0x MOIC over three years represents much better capital efficiency than a 2.0x over eight years, and IRR captures that difference. IRR is also essential when evaluating reinvestment opportunities; understanding your annualized return helps you assess whether redeploying capital elsewhere might generate better outcomes. [What is a compliance report: A guide on compliance reportingA clear, no-fluff guide to compliance reporting for finance teams who do it all.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-374.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/compliance-report-blog-meta-2-4.png)](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) **When the metrics disagree:** Consider two investments: Deal A returns 3.0x over seven years, while Deal B returns 2.0x over two years. MOIC favors Deal A (higher multiple), but IRR likely favors Deal B (faster return). Neither metric is wrong, they're just measuring different things. In situations like this, use both. Report MOIC for magnitude and IRR for speed, and let the context determine which matters more for your specific decision. The key trade-off to remember: MOIC ignores timing entirely, which can make slow-returning investments look better than they are. IRR, meanwhile, can be distorted by early distributions or unusual cash flow patterns. Relying on either metric alone gives you an incomplete picture. ## **What factors impact MOIC?** MOIC can be a bit of a moving target. There are a few things that can swing the number up or down. Knowing these factors helps you understand what the MOIC means for an investment's success. Here’s a breakdown of factors that can impact MOIC: - **How the investment does:** Strong investments with big returns naturally lead to a higher MOIC. The opposite is true for losses. - **The time you're invested:** MOIC doesn't consider how long you hold an investment, but faster wins can be more attractive even if the MOIC is the same as a long-term play. - **Fees and costs:** Just like any purchase, fees and expenses take a bite out of your return, lowering the MOIC. - **How you cash out:** Selling at the right time or through a good deal can boost your return (and MOIC). The opposite can hurt it. - **The overall market:** Big economic swings, changes in what people buy, and industry trends can all affect how much you make on your investment, impacting MOIC. By understanding these factors, you can get a better sense of what an MOIC really means and make smarter investment choices. [CapEx vs Opex | Key differences, examples & why it mattersMaster the difference between CapEx and OpEx to optimize budgeting and drive growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-375.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/capex-vs-opex-2.png)](https://www.financealliance.io/capex-vs-opex/) ## **Gross MOIC vs. net MOIC (and why LPs should care)** When evaluating fund performance, the distinction between gross and net MOIC determines whether you're looking at the investment team's results or what limited partners (LPs) actually take home. These two figures can differ substantially, and mixing them up leads to flawed comparisons. ### **Gross MOIC formula** Gross MOIC measures investment performance before fund-level fees, expenses, and carried interest are deducted. The formula remains the same (total value divided by invested capital) but both components reflect pre-fee figures. This is the number deal teams and GPs (general partners) typically use internally to evaluate their investment selection and value creation. It answers the question: how well did we pick and manage these companies? ### **Net MOIC formula (After fees and carry)** Net MOIC reflects what LPs actually receive after management fees, fund expenses, and carried interest have been subtracted. The numerator becomes the total distributions to LPs plus their share of remaining NAV, while the denominator stays as called capital from LPs. This is the figure that matters for LP reporting and fund-to-fund benchmarking. ****Here's a simplified example showing the difference:** A fund calls $100 million from LPs and generates $250 million in total value at the portfolio level. Gross MOIC equals 2.5x. However, after deducting $20 million in cumulative management fees, $5 million in fund expenses, and $25 million in carried interest (assuming 20% carry on profits above a hurdle), the net value to LPs is $200 million. Net MOIC equals 2.0x. That 0.5x difference represents real money; in this case, $50 million that went to fees and GP compensation rather than LP returns. GPs typically report gross MOIC when discussing deal performance and investment track records. LPs should focus on net MOIC when evaluating fund returns and comparing managers. Problems arise when these figures get conflated in marketing materials or due diligence conversations. Always clarify which version you're looking at, and when benchmarking against industry data, ensure you're comparing net to net or gross to gross. ## **What are the disadvantages of MOIC?** Yes, MOIC is an incredibly [valuable metric](https://www.financealliance.io/esg-metrics/), especially for finance teams. But it has some limitations to consider… **Doesn't account for the time value of money** MOIC compares the total return to the initial investment. It doesn't consider *when* the cash flows occur. An investment that delivers a large return all at once might have the same MOIC as one that provides smaller returns spread out over time. However, the first option is generally considered more favorable due to the time value of money. **Limited view of risk** MOIC doesn't tell you anything about the risk involved in an investment. A high MOIC could be the result of a very risky investment that just happened to pay off. **Sensitive to exit strategy** The final value of an investment, and therefore its MOIC, can be significantly impacted by how you exit the investment. A well-timed sale can maximize returns, while a forced sale might result in lower returns and a lower MOIC. MOIC doesn't account for the skill of the investor in achieving the exit strategy. **Focuses on overall return, not performance** While MOIC tells you how much you made in total, it doesn't provide details about the investment's performance over time. This can be a drawback for investors who want to understand the investment's consistency and stability. MOIC is a good starting point but shouldn't be the only factor considered when evaluating an investment. It's important to use MOIC in conjunction with other metrics like IRR (Internal Rate of Return) that consider the time value of money and risk. ## **How MOIC influences decision-making** MOIC plays a significant role in shaping investment decisions, particularly in private equity. Here's how it can influence decision-making and help companies make smarter business choices: ### **1\. Choosing investments** MOIC is often used as a screening metric when evaluating potential investment opportunities. Investors often set a minimum MOIC they expect. Deals with a lower projected MOIC might get passed over in favor of those with a higher potential return. ### **2\. Risk assessment** MOIC provides insight into the [risk-return profile](https://www.financealliance.io/finance-and-compliance/) of an investment. A high MOIC could mean a high potential return, but also potentially higher risk. Investors use MOIC with other tools to see if the expected return is worth the risk. ### **3\. Performance evaluation** MOIC is a simple way to measure how well an investment is doing. It tells you how many times you've gotten your money back. This helps investors decide whether to hold, sell, or invest more in something based on its performance. ### **4\. Attracting investors** For companies and fund managers, showcasing investments with high MOIC can be a powerful tool in fundraising efforts and maintaining positive investor relations. A strong track record of achieving high MOICs shows they’re good at managing money, which attracts more [investors and funding](https://www.financealliance.io/how-to-effectively-fundraise-and-find-investors/). ### **5\. Resource allocation** Investments with a higher MOIC might get more resources because they're seen as a better use of the money. This can also help CFOs when it comes to [allocating the budget across departments](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). ### **6\. Exit strategy** If an investment hits or surpasses its MOIC target, investors might be more likely to cash out and take the profits. ### **7\. Portfolio construction** Fund managers use MOIC to balance their portfolios and allocate capital across different investment opportunities. They may aim to maintain a certain average or targeted MOIC for their overall portfolio, which influences how they distribute their investments. --- ### FAQs: MOIC What is typical Moic in private equity? While a definitive average is elusive, typical MOICs in private equity can range from 2x to 3x the invested capital. This means for every $1 invested, the expectation is to receive $2-$3 back. However, some successful funds might achieve MOICs well above 3x, while others might struggle to reach 2x depending on the factors mentioned above. What is MOIC and DPI? PI (Distribution to Paid-In Capital) is another metric used in private equity. It measures the total amount of cash returned to investors relative to the amount they originally invested. MOIC, on the other hand, considers both the cash received and the unrealized gains (potential future value) of the investment. What is the MOIC return multiple? The MOIC return multiple is simply another way of saying "MOIC." It emphasizes that MOIC is a multiple of the initial investment. How is MOIC calculated? MOIC is calculated by dividing the total value of the investment (including realized and unrealized gains) by the total invested capital. Is IRR or MOIC more important? There's no single "more important" metric. MOIC is simpler and quicker to calculate, offering a snapshot of overall return. IRR is more complex but provides a more nuanced picture by considering the time value of money. Use MOIC for a quick comparison, and IRR for a deeper analysis. Does higher IRR mean riskier? Not necessarily. A higher IRR can indicate a potentially better investment, but it doesn't automatically mean higher risk. You should always consider other factors alongside IRR. What is the difference between MOIC and ROI? ROI (Return on Investment) is a broader term used for any investment. MOIC is specific to private equity and considers both cash received and unrealized gains. What is a good MOIC multiple? A "good" MOIC depends on the context. In general, a higher MOIC is better, but consider the risk involved and compare it to similar investments. ### FP&A salary and career path guide (from entry-level to executive) URL: https://www.financealliance.io/fp-a-salary-and-career-path-guide/ Last updated: 2026-02-17T09:34:06.000Z Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite. 🎓 Let’s be honest – everyone’s FP&A career path looks a bit different. But no matter which road you choose, there are certain milestones and pit stops that *most* FP&A professionals will encounter along the way. This guide is all about giving you a roadmap of what to expect, from entry-level gigs to the big c-suite roles. We'll break down the typical responsibilities, skills, and salary ranges for each stage of the FP&A career path. 🪜 ### **Table of contents:** - [FP&A salary and career path](https://www.financealliance.io/p/f2c3f06e-e5b1-4903-8747-c0e56427b9c7/#fpa-career-path-progression) - [Does FP&A lead to CFO?](https://www.financealliance.io/p/f2c3f06e-e5b1-4903-8747-c0e56427b9c7/#does-fpa-lead-to-cfo) - [What are the qualifications for FP&A?](https://www.financealliance.io/p/f2c3f06e-e5b1-4903-8747-c0e56427b9c7/#what-are-the-qualifications-for-fpa) - [FP&A skills](https://www.financealliance.io/p/f2c3f06e-e5b1-4903-8747-c0e56427b9c7/#fpa-skills) - [How to get a job in FP&A without experience](https://www.financealliance.io/p/f2c3f06e-e5b1-4903-8747-c0e56427b9c7/#how-to-get-a-job-in-fpa-without-experience) - [Is FP&A a good career?](https://www.financealliance.io/fp-a-salary-and-career-path-guide/#is-fpa-a-good-career) - [Does FP&A have good exit opportunities?](https://www.financealliance.io/fp-a-salary-and-career-path-guide/#does-fpa-have-good-exit-opportunities) - [How to get into FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/#how-to-get-into-fpa-fpa-salary-career-path-progression-tips) ## **FP&A career path (progression)** As we mentioned, not *every* FP&A career progression looks the same. However, it can typically look something like this: ![FP&A career path](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/FP-A-CAREER-PATH.png) **A simplified look at a potential FP&A career path* The [FP&A career](https://www.financealliance.io/fast-tracking-your-fp-a-career/) ladder follows a relatively predictable sequence, though the titles themselves can vary significantly depending on company size, industry, and geography. As Jon Yuregir, ex-Head of Finance at EasyJet, explains, the progression typically moves through "analyst to senior analyst to manager, head of, director, VP, and then adding value in the C-suite." Each rung represents a meaningful shift in scope, [stakeholder](https://www.financealliance.io/stakeholder-communication-plan/) exposure, and planning responsibility. At the Analyst level, you own discrete analyses and support the [forecasting process](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/). Your stakeholders are primarily your direct manager and perhaps department leads. Senior Analysts take on broader ownership of specific business units or cost centers, often becoming the go-to person for particular areas of the P&L. The planning horizon expands from monthly cycles to quarterly outlooks. Managers and Finance Business Partners begin leading [small teams](https://www.financealliance.io/why-finance-teams-struggle-to-act-on-their-data-and-how-to-fix-it/) or owning entire planning processes end-to-end. You're now presenting to senior directors and VPs, and your work shapes decisions rather than simply informing them. Directors and Heads of FP&A own the full planning calendar for their division or the entire company, depending on organizational size. Your stakeholders include the [CFO](https://www.financealliance.io/top-10-cfo-skills/) and executive committee, and you're thinking in annual and multi-year horizons. VPs of [FP&A](https://www.financealliance.io/top-10-fp-a-skills-to-master/) typically sit one level below the CFO, owning strategic planning, board materials, and cross-functional alignment. The distinction between Head of, Director, and VP can be murky. As Yuregir notes, "the key thing to think about is how many rungs are you away from the CFO" and how large the company is. A Director at a 200-person startup might have broader scope than a VP at a Fortune 500 company. Corporate Finance and Strategic Finance roles often share similar rungs, with titles like FP&A Lead or Finance Business Partner appearing at various levels depending on the organization's structure. **Let’s explore each role (*and FP&A salary insights*) in more detail:** --- ## **FP&A Analyst** An FP&A Analyst specializes in gathering, analyzing, and interpreting financial data to support an organization's [planning](https://www.financealliance.io/driver-based-planning-forecasting/), [budgeting](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), forecasting, and strategic decision-making processes. ****Experience:** 1-3 years with a background in accounting is common. But that doesn’t mean you can’t go straight into this role out of undergrad, it happens! **Responsibilities:** Some common responsibilities include: - [Monitoring](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) and analyzing financial activities - Preparing reports that summarize the company’s [financial performance](https://www.financealliance.io/infographic-financial-performance-metrics/) - Assessing profitability and investment returns - Financial health assessment - [Risk evaluation](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) - Support senior management and stakeholders in decision-making **Desired skills:** Proficiency in Excel, data queries, basic [financial modeling](https://www.financealliance.io/10-best-financial-modeling-tools/), a solid understanding of accounting principles and financial reporting standards, keen attention to detail and excellent problem-solving abilities are just some of the desired skills of the role. ### **FP&A Analyst salary range** Glassdoor reports the average base FP&A Analyst salary range to fall between [**$99,000 and $143,000**](https://www.glassdoor.com/Salaries/fp-analyst-salary-SRCH%5FKO0,10.htm), while other sources report an annual salary of [**$66, 425**](https://www.salary.com/research/salary/listing/fpanda-analyst-salary). ## **Senior FP&A Analyst** A Senior FP&A Analyst stands as a more experienced and advanced position within the financial planning and analysis sector, typically following the role of an FP&A Analyst. This progression is a crucial step in the [FP&A career path](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/), indicating a move towards more strategic, high-impact responsibilities within the finance function. ****Experience:** 3-5 years. Typically, accounting backgrounds take preference and having an MBA will give you a better chance of being hired. **Responsibilities:** Senior FP&A Analysts are usually responsible for: - Leading financial [forecasting](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/) - Managing budgeting activities - Conducting [scenario analysis](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/) - Providing financial recommendations - Collaborating across departments - Ensuring report accuracy - Developing financial strategy **Desired skills:** Some key skills to succeed in this role include advanced financial modeling and Excel capabilities, strong analytical and strategic thinking, effective [communication with stakeholders](https://www.financealliance.io/stakeholder-communication-plan/), and leadership qualities to guide teams and influence decisions. Proficiency in corporate finance and financial reporting standards is also essential, alongside the ability to efficiently collaborate with cross-functional teams for data analysis and strategic planning. ### **Senior FP&A Analyst salary range** The average FP&A salary for a Senior FP&A Analyst ranges between [$87,086 and $103,629](https://www.salary.com/research/salary/listing/senior-analyst-financial-planning-and-analysis-salary). However, [according to Glassdoor](https://www.glassdoor.com/Salaries/senior-fp-a-analyst-salary-SRCH%5FKO0,19.htm), you could make between **$124k** and **$175k** a year. We advise carrying out research to discover the typical salary range for this role within your local area or state. [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-361.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-16.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ## **FP&A Manager** The next role in the typical FP&A career path is the role of a [FP&A Manager](https://www.financealliance.io/fp-a-manager-what-does-an-fp-a-manager-do/). This is a key finance role within organizations, responsible for overseeing financial planning, [analysis](https://www.financealliance.io/cost-benefit-analysis/), and reporting activities. This managerial position involves [leading the FP&A department](https://www.financealliance.io/building-an-fp-a-function-strategies-for-effective-team-and-organizational-structure/) in budgeting, forecasting, and providing analytical support to inform business decisions and strategy. ****Experience:** 5-10 years. Most FP&A Managers have a CPA or MBA. **Responsibilities:** Primary responsibilities include: - Managing the [financial planning](https://www.financealliance.io/10-big-picture-financial-planning-steps/) process - Developing and refining financial models - Conducting [variance analysis](https://www.financealliance.io/budget-vs-actual-variance-analysis/) between actual results and forecasts - Leading financial performance reviews - Driving the development of financial reports **Desired skills:** Beyond technical skills, this role demands excellent [leadership](https://www.financealliance.io/financial-leadership-in-changing-times-2/), communication, and strategic thinking abilities, as it involves [collaboration](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) across various departments and levels of management. This role requires a combination of analytical expertise, strategic vision, and the ability to manage both projects and teams effectively. ### **FP&A Manager salary range** [Wall Street Prep](https://www.wallstreetprep.com/knowledge/fpa-career-path-salary-guide-analyst-director/) reports the average [FP&A Manager salary](https://www.financealliance.io/fp-a-manager-salary/) to range from **$50,000** to **$70,000** including bonuses. However, [Glassdoor](https://www.glassdoor.com/Salaries/fp-and-a-manager-salary-SRCH%5FKO0,16.htm) reports that the estimated pay ranges between **$1** per year in the United States. ## **FP&A Director (or VP of FP&A)** An FP&A Director or Vice President (VP) of Financial Planning & Analysis is a senior executive role within an organization, tasked with leading the FP&A department and setting the strategic direction for financial planning, [analysis](https://www.financealliance.io/cost-benefit-analysis/), and reporting. The FP&A Director/VP oversees long-term financial planning, [budget management](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/), and performance analysis, ensuring that financial goals align with the company's strategic objectives. ****Experience:** Usually 10+ years of experience. **Responsibilities:** As the most senior role in FP&A, the Director or VP of FP&A can expect responsibilities such as: - Strategic and long-term financial planning - Budget management - Financial [reporting and analysis](https://www.financealliance.io/the-evolving-role-of-fp-a-in-esg-planning-and-reporting/) - Performance analysis - [Risk management](https://www.financealliance.io/financial-crime-risk-management-fcrm/) - Team leadership and development - Stakeholder communication - Financial systems and process improvement **Desired skills:** The most desired skills for an FP&A Director blends advanced financial expertise with strategic oversight and leadership capabilities. You’ll be expected to have a deep understanding of financial modeling, excellent leadership skills, communication skills, problem-solving, and experience in [managing change](https://www.financealliance.io/managing-complex-change-matrix/). ### **FP&A Director salary range** [According to Glassdoor](https://www.glassdoor.com/Salaries/financial-planning-and-analysis-fp-a-director-salary-SRCH%5FKO0,45.htm), the average FP&A salary range for someone in a director position in the United States is **$111k to 172k** a year, though [other sources](https://www.salary.com/research/salary/benchmark/financial-planning-and-analysis-director-salary) set it at **$180,867 and $215,853**. [How generative AI is transforming financeFinancial advisors could use AI to generate initial investment recommendations while focusing their expertise on understanding client needs and providing personalized guidance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-362.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--9-.png)](https://www.financealliance.io/how-generative-ai-is-transforming-finance/) As Jon Yuregir points out, you should "look at the actual remits of the job description" including "the size of the company, the size of the division, the complexity" when evaluating compensation. A Manager at a high-growth [tech company](https://www.financealliance.io/15-best-fp-a-tools-and-software/) with P&L ownership across multiple business units may command Director-level pay elsewhere. Second, higher seniority generally brings higher pay, but as Yuregir notes, "with higher levels of seniority comes higher levels of stress." The jump from Manager to Director often involves a meaningful increase in executive exposure and accountability that goes beyond the compensation bump. When negotiating, focus on demonstrating scope and impact rather than years of experience alone. Companies pay for the problems you can solve and the decisions you can influence, not simply for time served in previous roles. ## **Does FP&A lead to CFO?** The [FP&A career path](https://www.financealliance.io/finance-careers-how-many-jobs-are-available-in-finance/) can definitely be your ticket to bagging a role as Chief Financial Officer (CFO). FP&A is all about budgeting, forecasting, and providing those killer financial insights that guide a company's major decisions, all of which are key components of the broader financial leadership [responsibilities of a CFO](https://www.financealliance.io/10-cfo-personality-traits/). Here's a simplified overview of how the FP&A career path can potentially lead to the role of CFO: ![FP&A to CFO career journey](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/FP-A-career-path.png) **A possible career path from analyst to CFO* Let’s break down how FP&A experience can prepare you for the C-suite: **Strategic insight:** In FP&A, you develop a deep understanding of a company's financial health and market position. This allows you to [strategize effectively for growth and stability](https://www.financealliance.io/guide-to-company-growth/), which is crucial when you're sitting in that CFO chair. **Decision-making:** You become a pro at making data-driven decisions in FP&A roles, a crucial part of a [CFO’s role](https://www.financealliance.io/podcast/4-roles-every-cfo-must-dominate-changing-role-of-the-cfo/). **Cross-departmental collaboration:** FP&A requires you to work closely with different departments. This helps you build those [communication](https://www.financealliance.io/stakeholder-communication-plan/) and [leadership](https://www.financealliance.io/financial-leadership-in-changing-times-2/) skills that are essential for the cross-functional oversight a CFO needs. **Financial reporting and compliance:** You get first-hand experience with [financial reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/), compliance, and risk management in FP&A positions. This lays the foundation for the comprehensive financial oversight responsibilities that come with being a CFO. While moving from [FP&A to CFO](https://www.financealliance.io/podcast/fp-a-to-cfo/) isn't the only path, many CFOs have backgrounds in FP&A, accounting, or finance. The journey often involves advancing through senior roles within FP&A, like FP&A Manager, Director, or VP, before stepping into that coveted CFO role. To learn more about how to become a CFO, check out our playbook: [*Journey to CFO*](https://www.financealliance.io/journey-to-cfo/)*.* [Journey to CFO eBook | Finance AllianceDownload the Journey to CFO eBook and take the first step on your road to the C-Suite.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/05/FA_Journey_to_CFO_eBook_Meta_.png)](https://www.financealliance.io/journey-to-cfo/) ### **From FP&A Director to CFO: the final-mile experiences** FP&A provides exceptional preparation for the CFO role. Yuregir says that "forty seven percent of CFOs come from FP&A, which speaks for itself in terms of understanding just how important that helicopter view is." But reaching the Director level in FP&A doesn't automatically qualify you for the top finance job. The final mile requires deliberate expansion into areas that FP&A typically doesn't cover. CFO candidates need breadth beyond [planning and forecasting](https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/). The role demands partnership with controllership on technical accounting matters, understanding of capital structure and [treasury](https://www.financealliance.io/corporate-treasury-guide-plus-3-strategies-to-save-your-company-a-fortune/) operations, comfort with investor relations and board cadence, and fluency in risk, [compliance](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/), and governance. If you've spent your career focused on the forward-looking side of finance, you'll need to build credibility in these backward-looking and external-facing domains. Pri Hancock, reflecting on her path to CFO, describes how FP&A prepared her for executive scrutiny: > "I would prepare my numbers, and then I would be absolutely grilled by the group controller about what's happening in this region of the world... that wisdom and having to understand the strategy of the company, to link the dots between what the CEO is saying and what's happening in the specific product areas gave me a desire that I wanna be CFO." That ability to connect strategic narrative to operational reality is essential. Here's a practical checklist for building [CFO readiness](https://www.financealliance.io/the-cfos-first-90-days-playbook/) over the next 6-18 months: **Expand your technical accounting partnership.** Volunteer to support the close [process or audit preparation](https://www.financealliance.io/finance-and-compliance/). Understand how your forecasts reconcile to GAAP results and where judgment calls create variance. **Get capital structure exposure.** Participate in debt covenant monitoring, refinancing discussions, or equity raise preparation if opportunities arise. Understand how financing decisions affect your planning assumptions. **Build board and investor fluency.** Seek [opportunities](https://www.financealliance.io/fp-a-exit-opportunities/) to prepare board materials or support investor communications. Learn the rhythm of quarterly earnings and annual planning cycles from an external stakeholder perspective. **Lead a transformation or crisis response.** CFOs are expected to navigate uncertainty. Owning a system implementation, restructuring, or rapid replanning exercise demonstrates the judgment and composure the role requires. **Present to the executive committee regularly.** The CFO role is fundamentally about influence at the highest level. If you're not already presenting to the CEO and executive team, find ways to increase that exposure before pursuing the top job. ## **What are the qualifications for FP&A?** To thrive in Financial Planning & Analysis (FP&A), professionals must cultivate a robust foundation of education, [certifications](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters), and continuous skill development. Here's a detailed look at the qualifications necessary for a career in FP&A, emphasizing the importance of understanding FP&A salary expectations and growth potential: ### **Certifications** 🎓 **Certified Public Accountant (CPA):** Recognized globally, a CPA credential signifies expertise in accounting and finance. While it's more accounting-focused, it provides a strong foundation for financial analysis and fiscal management. **Chartered Financial Analyst (CFA):** The CFA certification is prestigious in the fields of investment and financial analysis. It covers portfolio management, [financial modeling](https://www.financealliance.io/12-financial-modeling-best-practices-to-avoid-frustrations/), and investment analysis, which are valuable in moving along the FP&A career path. **Certified Corporate FP&A Professional (FPAC):** Offered by the Association for Financial Professionals (AFP), the FPAC certification is specifically designed for FP&A practitioners. It focuses on data analysis, [budgeting](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/), forecasting, and strategic planning. [Transforming from accounting to FP&A business partneringThinking of moving from accounting to FP&A? Discover the five strategies that are going to help you make the transition into the world of FP&A from Global Finance & Strategy leader (and FP&A expert), Dr. Mohamed El Rouby.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-363.png)Finance AllianceMohamed El Rouby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--30--1.png)](https://www.financealliance.io/transforming-from-accounting-to-fp-a-business-partnering/) ### **Advanced certifications and degrees** 🎓 **Master of Business Administration (MBA):** An MBA with a focus on finance or accounting provides comprehensive business and financial training, [leadership skills](https://www.financealliance.io/cfo-leadership-pillars/), and networking opportunities, making it highly beneficial for advancing in FP&A. **Master's in Finance:** More specialized than an MBA, a Master's in Finance focuses intensely on financial theory, markets, and financial analysis techniques. It's ideal for those seeking deep expertise in finance. **Master's in Accounting or Economics:** These degrees offer specialized knowledge that can be directly applied to FP&A roles, particularly in areas related to fiscal policy, [economic analysis](https://www.financealliance.io/7-benefits-of-esg-investing/), and accounting principles. ## **FP&A skills** When it comes to FP&A roles, there are several key [FP&A skills](https://www.financealliance.io/top-10-fp-a-skills-to-master/) that are highly sought after and essential for success: ### **Strong analytical mindset and an ability to make sense of complex financial data** - Gather information from various sources. - Crunch numbers and identify patterns and trends. - Inform strategic business decisions with [data-driven insights](https://www.financealliance.io/from-data-driven-to-ai-powered/). ### **Effective communication skills** - Translate insights into clear, concise [reports and presentations](https://www.financealliance.io/how-color-impacts-your-finance-presentations/). - Resonate with both finance and non-finance stakeholders. - [Tell a compelling story](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) through data and make actionable recommendations. ### **Solid understanding of financial modeling and forecasting techniques** - Build robust models to accurately [predict future performance](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/). - Develop scenarios, stress-test assumptions. - Provide insights to support strategic planning and decision-making. ### **Strong business acumen** - Deep understanding of the organization's operations, [industry trends](https://www.financealliance.io/key-trends-shaping-the-future-of-finance/), and competitive landscape. - Provide context and perspective to analysis and recommendations. - Ensure work is aligned with the company's overall objectives. ### **Collaboration and interpersonal skills** - Work closely with [cross-functional teams](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) (operations, marketing, sales). - Build strong working relationships and influence stakeholders. - Drive consensus around financial decisions. ### **Adaptability and willingness to learn** - Finance landscape is constantly evolving ([new technologies](https://www.financealliance.io/fintech-and-ai/), regulations, best practices). - Open to continuously developing skills and embracing change. - Stay ahead of the curve to remain relevant and valuable. By possessing these key skills, FP&A professionals can excel in their roles and make a significant impact on the success of their organizations. Mastering these competencies is important for advancing along the FP&A career path, allowing you to take on increasingly complex and influential roles within the finance domain. [15 must-read FP&A books 📚Get ready to add more titles to your TBR (to be read) list as we reveal the 15 best FP&A books to help you excel within your role.👇🏼![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-364.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Stock-1.png)](https://www.financealliance.io/11-must-read-fp-a-books/) ## **How to get a job in FP&A without experience** Getting a job in FP&A without experience can be a challenge, but it's definitely not impossible! Here are some tips to help you [break into FP&A](https://www.financealliance.io/breaking-into-fp-a-without-fp-a-experience/): ### **1\. Learn about FP&A** If you want to get a job in FP&A without experience, it’ll help if you knew the ins and outs of the role. > *“Start by gaining a solid understanding of the fundamentals of financial statements. Take the time to learn about the specific roles and responsibilities of an FP&A professional.* > *“This includes understanding management reporting, profitability and variance analysis, financial modeling, budgeting, and forecasting, as well as the tools and technologies commonly used in FP&A.” – *Asif Masani, FP&A expert and Chief Learning Officer at FP&A Professionals** ### **2\. Highlight your transferable skills** Even if you don't have direct FP&A experience, focus on [showcasing skills that are relevant to the role](https://www.financealliance.io/transferable-fp-a-skills-that-open-doors-way-beyond-finance/), such as strong analytical abilities, [proficiency with Excel](https://www.financealliance.io/chatgpt-for-excel/) or data analysis software, and an aptitude for financial reporting and modeling. ### **3\. Consider internships or entry-level roles** Look for internship opportunities in the finance or [accounting departments of companies](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/), which will provide hands-on experience and exposure to the FP&A process. While these early roles might offer a lower FP&A salary initially, they're crucial for building the experience necessary to advance in the field. You can also consider entry-level roles like Financial Analyst or Accountant, which can serve as a stepping stone to an FP&A position. ### **4\. Pursue relevant certifications** Earning certifications like the Certified Management Accountant (CMA) or the Financial Modeling and Valuation Analyst (FMVA) can demonstrate your commitment to the field and enhance your credibility, even *without* direct experience. ### **5\. Network, network, network** [Attend industry events](https://events.financealliance.io/?%5Fgl=1%2A40tq6l%2A%5Fga%2ANTY3MTk0Njc1LjE3MDgwOTA2Nzk.%2A%5Fga%5F2NXFSBEP4N%2AMTcwODY4MDIwMy4zMS4xLjE3MDg2ODE0NTguMC4wLjA.), join professional organizations, and connect with people working in FP&A roles. This can help you gain insights, identify potential job opportunities, and even secure referrals or recommendations. ### **6\. Be proactive in your job search** Asif Masani shares his advice: > *“While you may not have direct FP&A experience, you can still highlight your relevant skills and knowledge in your job search.* > *“Look for entry-level positions or internships in finance or FP&A and tailor your resume and cover letter to highlight your relevant skills and experiences.” - *Asif Masani, FP&A expert and Chief Learning Officer at FP&A Professionals** [Example of financial analysis that shows significant cost savings (interview question)Hiring managers want two things when they ask, “Can you give an example of a financial analysis that led to significant cost savings?” Can you answer?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-365.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--10-.png)](https://www.financealliance.io/example-of-financial-analysis-that-shows-significant-cost-savings/) ### **A 30-day plan to become interview-ready (with no experience)** Yuregir notes that "a lot of finance graduates or school leavers start either in a controlling function or in a [business partnering](https://www.financealliance.io/transforming-from-accounting-to-fp-a-business-partnering/) function" before moving into FP&A. These roles are separated by what he calls "one degree of separation," making the transition much smoother. Here's a **30-day plan** to position yourself as a credible FP&A candidate: **Days 1-10: Translate your experience into FP&A language.** Review your current or past roles for any exposure to budgeting support, variance explanations, operational [metrics](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) tracking, or month-end close activities. Reframe these experiences using FP&A terminology: "supported budget variance analysis" rather than "helped explain cost overruns." Update your resume to emphasize decision support, forward-looking analysis, and cross-functional [collaboration](https://www.financealliance.io/5-steps-collaborative-budgeting-process/). **Days 11-20: Build a mini portfolio.** Create two to three artifacts that demonstrate FP&A thinking. Build a simple driver-based revenue model in Excel using publicly available data from a company you admire. Create a budget vs actuals dashboard that [highlights variances and explains](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/) the "so what." Write a one-page monthly business review for a hypothetical business unit, focusing on insights rather than just numbers. **Days 21-30: Practice the narrative.** FP&A hiring managers want to see that you understand the role's purpose, which is translating financial data into business decisions. Prepare stories that show how you identified a trend, communicated it to stakeholders, and influenced an outcome. Even if the example comes from a non-finance context, the pattern of analysis leading to action is what matters. If you're coming from audit or accounting practice, Yuregir suggests moving into a financial control role first, then [transitioning](https://www.financealliance.io/transitioning-to-fractional-financial-leadership-how-to-lead-in-2-4-days/) to FP&A. If you're coming from commercial or operations, a business partnering finance role serves as the natural bridge. The key is reducing the degrees of separation rather than trying to leap directly into FP&A from an unrelated function. [How to transform financial data into compelling storiesFP&A professionals have to understand the business deeply. We’re not just reporting results or explaining variances. We are taking on part of the decision-making burden.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-368.png)Finance AllianceLewis Danby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--5--4.png)](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) ## **Is FP&A a good career?** The [FP&A](https://www.financealliance.io/your-ultimate-guide-to-fp-a/) career path is an excellent choice for finance and analytics enthusiasts. It offers: - High demand across industries, ensuring job security and opportunities for growth. - An analytical and strategic role, analyzing data and [providing insights](https://www.financealliance.io/cost-benefit-analysis/) to support key decisions. - Cross-functional exposure, collaborating with various teams to understand their financial needs. - Competitive compensation, with your FP&A salary increasing as you gain experience and responsibilities. - Clear [career advancement](https://www.financealliance.io/fast-tracking-your-fp-a-career/), progressing from entry-level roles to senior management positions. - Transferable skills that open up diverse exit options, from corporate finance to investment banking and beyond. While demanding strong analytical and communication abilities, FP&A's dynamic nature, continuous learning, and potential for career growth make it a highly rewarding choice. If you're passionate about [finance](https://www.financealliance.io/7-tips-for-finance-to-get-closer-to-business-2/), strategy, and driving business impact, FP&A is definitely worth considering. ### **Is it hard to break into FP&A?** Breaking into the field of FP&A can be challenging, especially for those without prior experience. FP&A roles are highly analytical and require a solid understanding of finance, accounting, and business operations. However, with the right approach and determination, it’s certainly possible to break into this field. ## **Does FP&A have good exit opportunities?** Yes, [FP&A can provide excellent exit opportunities](https://www.financealliance.io/fp-a-exit-opportunities/) for professionals looking to transition to other roles or industries. The skills and experience gained in FP&A are highly transferable and valuable across various domains, making it a versatile career path with many potential exit options. Some options include consulting, moving into corporate finance, teaching, mentoring, entrepreneurship and more. [Does job-hopping increase your salary in finance?The question isn’t whether job-hopping increases salary, as it clearly does. The more important question is how and when to move in order to maximise long-term value.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-366.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--6--4.png)](https://www.financealliance.io/does-job-hopping-increase-your-salary-in-finance/) ## **How to get into FP&A (FP&A salary & career path progression tips)** Advancing in the FP&A world is all about leveling up your [skills](https://www.financealliance.io/top-10-cfo-skills/) and making yourself indispensable. Here's the scoop on how to climb that career ladder: ### **1\. Get familiar with accounting best practices** This one's a no-brainer. You need a solid foundation in accounting principles, financial statements, and reporting standards. This knowledge will be the backbone of everything you do, so make sure you've got it covered. ### **2\. Understand the ins and outs of budgeting** If you want to increase your FP&A salary and progress, you need to know how to [manage the budget process](https://www.financealliance.io/flexible-budget-performance-report/) from gathering data to monitoring performance against targets. Show off your skills in streamlining the process and providing insights that will help guide those big, strategic decisions. ### **3\. Become an expert in financial analysis methods** You’ll need to be really good at techniques like variance analysis, ratio analysis, and trend analysis. Develop proficiency in building robust financial models and [forecasting techniques](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/) to provide accurate and insightful projections. ### **4\. Financial storytelling** Numbers alone won't cut it. You have to weave those [financial data points into compelling narratives](https://www.financealliance.io/storytelling-with-data-visualization-playbook/) that will resonate with stakeholders. Use visualizations, dashboards, and killer presentations to bring your analyses to life and make complex information digestible and impactful. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-367.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-13.png)](https://www.financealliance.io/financial-charts-and-graphs/) ### **5\. Finance business partnering** Cultivate those relationships with [cross-functional](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) teams and business units. Position yourself as a trusted advisor who can translate financial data into actionable insights that support their [goals](https://www.financealliance.io/10-big-picture-financial-planning-steps/). Effective communication and collaboration is so important in order to progress in FP&A. ### **6\. Embrace continuous learning** Never stop expanding your knowledge and skillset. Pursue certifications like the CMA or CFA to show your commitment to professional development. Attend industry events, join professional organizations, and network with other FP&A pros to stay informed about emerging trends and best practices. ## **Conclusion** As you can see, the path to success in FP&A is all about continuous growth, adaptability, and making yourself invaluable. By mastering the fundamentals, developing your analytical skills, and cultivating those all-important soft skills, you'll be well on your way to climbing the career ladder and reaching new heights. And let's not forget about that FP&A salary. With each step up the ladder, you can [expect your paycheck to reflect your increasing expertise and value](https://www.financealliance.io/how-much-should-you-be-earning/). From entry-level analyst to senior manager and beyond, the FP&A field offers competitive compensation packages that reward your hard work and dedication. So, if you're passionate about finance, analytical problem-solving, and being at the forefront of strategic decision-making, the FP&A path might be the ideal career path for you! ![](https://media.tenor.com/6SZYp3-LqG0AAAAC/kevinmcgarry-mcgarries.gif) ## **FAQs** ### How do I start a career in FP&A? Start by gaining a solid foundation in finance or accounting through education, then develop key skills in financial modeling, analysis, and forecasting. Internships or entry-level positions in finance can also provide practical experience. ### What are the qualifications for FP&A? Typically, a bachelor's degree in finance, accounting, or a related field is required. Professional certifications like CFA or CPA, and skills in financial modeling, Excel, and [data analysis](https://www.financealliance.io/microsoft-fabric-for-data-analysis/) are also valuable. ### Is FP&A a stressful job? FP&A can be demanding, especially during [budgeting and forecasting cycles](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) or fiscal year-end. The stress levels can vary based on the company's environment, deadlines, and individual workload management. ### Can you go from accounting to FP&A? Absolutely. Many professionals transition from accounting to FP&A, leveraging their understanding of financial statements and analytical skills to move into more strategic financial roles. ### Do you need to be an accountant for FP&A? No, it's not mandatory to be an accountant to work in FP&A, but a solid understanding of accounting principles is crucial due to the financial analysis involved. ### Can you move from FP&A to investment banking? Yes, it's possible to transition from FP&A to investment banking, especially with strong financial modeling skills, industry knowledge, and a network within the banking sector. ### Can FP&A become CFO? Yes, many CFOs start their careers in FP&A, as it provides a comprehensive understanding of financial planning and business strategy, which are key components of the CFO role. ### What is the career progression of FP&A? Career progression in FP&A typically starts with roles like FP&A Analyst, advancing to Senior Analyst, then FP&A Manager, Director or VP of FP&A, and potentially to CFO. Each role involves increasing responsibility in financial strategy, analysis, and leadership. --- ### FP&A Certified Core course: Take your career to the next level Are you ready to advance to the next level in your FP&A career? Our FP&A Certified Core course is your gateway to becoming a leader in the finance industry. This course is specifically tailored to provide you with the insights and techniques used by top FP&A professionals. Through a series of comprehensive modules, you'll learn how to harness sophisticated financial tools, perform impactful analysis, and deliver results that propel your company forward. With our expert guidance, you’ll not only achieve certifications but also gain a competitive edge in your career. [Sign up today](https://certified.thealliance.io/course/fpa-certified-core ) ### When healthcare costs rise, can you explain why? URL: https://www.financealliance.io/when-healthcare-costs-rise-can-you-explain-why/ Last updated: 2026-02-12T13:17:27.000Z For most companies, people costs represent the single largest category of operating expense, spanning compensation, benefits, workforce investments, and long-term talent strategy. Yet when those costs shift unexpectedly, finance leaders are often left defending variances without being able to clearly explain what actually changed or why. Boards and executive teams expect precision around revenue drivers and capital allocation, but people-cost movements are often explained in broader, less definitive terms. That gap can create discomfort at the leadership level, particularly when workforce-related expenses materially impact margin performance and forecasting accuracy. Reports and dashboards may outline year-over-year movement. Vendor summaries may offer high-level explanations. But surface-level reporting rarely answers the questions that matter most to fiduciary oversight: What is truly driving cost? What is controllable? And where does governance need to be strengthened? Finance teams are increasingly held accountable for major variances in people costs, yet many remain reliant on reporting that stops at “what happened” without delivering an independent explanation of why it happened or how to act on it. ## **The governance challenge in people costs** An [**upcoming live session from Andovia**](https://www.financealliance.io/how-finance-leaders-govern-healthcare-spend/)examines how finance teams can move beyond vendor narratives and build a more defensible, finance-led view of complex cost categories. [How finance leaders govern healthcare spend | Live sessionPractical insight for finance leaders to gain independent visibility and govern healthcare spend more effectively.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-360.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/DO-NOT-OVERRIDE-PMA_Webinar_Meta_Template_--3--1.png)](https://www.financealliance.io/how-finance-leaders-govern-healthcare-spend/) Rather than focusing on reporting outputs alone, the session centers on governance-grade insight, grounded in actuarial rigor and practical finance frameworks that support informed decision-making and sustainable cost control. Traditional dashboards are designed to summarize activity, not to establish accountability. They aggregate trends and benchmarks, but often lack the analytical structure required to separate signal from noise. Without a structured governance lens, even sophisticated reporting can leave finance leaders without a single, comprehensive, and independent view of truth or a clear path from data to action. Data may exist in massive volumes, yet it remains difficult to use, validate, or translate into meaningful operational and financial decisions. As a result, organizations can become reactive (relying heavily on external partners to interpret results) while still carrying full fiduciary responsibility for outcomes. ## **From reporting to accountability** The emphasis of this session shifts from static dashboards to insight that can withstand scrutiny, enabling finance leaders to validate underlying drivers, assess predictability, and distinguish between structural trends and controllable cost factors. Governance, in this context, is about establishing clear ownership, independent validation, and structured decision-making processes that allow finance to lead with confidence. When governance frameworks are aligned with financial priorities, major people-cost categories become managed cost centers rather than recurring surprises. Attendees will explore how to move from opaque reporting and reactive decisions to governance-grade insight that supports fiduciary oversight, informed action, and sustainable cost management, without adding internal burden or unnecessary complexity. [Attend the free live session](https://www.financealliance.io/how-finance-leaders-govern-healthcare-spend/) ## **Applying this lens to healthcare spend** Healthcare costs continue to rise year over year, yet many self-insured employers still struggle to answer a basic question: why. Within the broader category of people costs, healthcare often represents one of the most volatile and least transparent components, making it especially challenging to forecast, govern, and defend. CFOs and HR leaders are inundated with dashboards, vendor reports, and retrospective summaries that lack a single, comprehensive, and independent view of truth or detailed, actionable insight. Employers frequently rely on vendors to report on and manage spend (often without independent validation) while remaining ultimately responsible as fiduciaries. [**This webinar**](https://www.financealliance.io/how-finance-leaders-govern-healthcare-spend/) **explores how self-insured employers are moving beyond high-level dashboards and blind trust to better govern healthcare spend.** By combining comprehensive data visibility, actuarial and clinical insight, and a clear path to action (executed in partnership with brokers) employers can achieve better control, improve quality, and reduce healthcare spend. Erik Kolstad, Actuary and Healthcare Economics Leader at Andovia, brings deep experience across commercial health, Medicaid, and Medicare markets. As an Associate of the Society of Actuaries and a Member of the American Academy of Actuaries, Kolstad will address structural drivers behind healthcare cost increases, including utilization patterns and hidden data gaps that can quietly undermine financial predictability. His perspective underscores how actuarial discipline and independent analysis strengthen financial oversight in one of the most complex areas of people spend. Joining him is David Magnan, a technology executive and business leader with more than 50 years of leadership experience across growth, transformation, operational excellence, and large-scale organizational change. Drawing from decades of experience leading complex organizations through turnarounds and strategic acquisitions, Magnan will explore how finance leaders can strengthen oversight, shift from passive reporting to active governance, and build frameworks that translate insight into measurable cost impact. His operational experience reinforces that sustainable cost control depends not only on better data, but on stronger governance structures that turn insight into disciplined execution. At its core, [the discussion reflects Andovia’s approach to healthcare cost governance](https://www.financealliance.io/how-finance-leaders-govern-healthcare-spend/?utm%5Fsource=linkedin&utm%5Fmedium=social&utm%5Fcampaign=linkedin%5Fnewsletter) for self-insured employers: - Combining actuarial expertise - Advanced data analysis - Finance-oriented governance frameworks to help organizations see through complexity, validate spend, and make defensible decisions with confidence. For finance leaders managing the largest line items on the income statement, the issue is no longer whether people costs are rising, but whether the organization can clearly explain what is driving those increases, and demonstrate that the right controls are in place. [Learn from the Andovia pros](https://www.financealliance.io/how-finance-leaders-govern-healthcare-spend/) ### Framework for building robust planning, budgeting, and forecasting processes URL: https://www.financealliance.io/framework-for-building-robust-planning-budgeting-and-forecasting-processes/ Last updated: 2026-03-20T17:04:51.000Z In my former role as a consultant in the CFO Excellence practice at Boston Consulting Group, I had the opportunity (sometimes passively, often actively) to observe and shape Planning, Budgeting, and Forecasting (PBF) processes across industries including Consumer Goods, Financial Services, Pharmaceuticals, and Energy. ## **My initial impressions were twofold** ### **The state is more fragile than many leaders realize** While it is expected that companies seeking external support have gaps, the baseline in some cases was startlingly low. I encountered a Fortune 500 pharmaceutical company running completely disconnected processes for [annual planning](https://www.financealliance.io/how-to-use-a-driver-based-forecast-to-drive-strategic-initiatives/) and capital projects. At the extreme end, a large financial institution had no formal PBF process at all, enabled largely by the absence of external [shareholders](https://www.financealliance.io/investor-relations-as-a-strategic-driver-of-corporate-value/) to hold management accountable. [How to turn forecasting & budgeting mistakes into successesExplore key lessons in implementation processes and corporate strategy, and how you can use them to achieve real, tangible results in your FP&A function.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-352.png)Finance AllianceJames Manning![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--9--1.png)](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) ### **Most organizations don’t have the toolkit to fix the issue** Even when CFOs clearly recognize these shortcomings, most organizations lack a practical [toolkit](https://www.financealliance.io/fx-toolkit/) to fix them. The intent to improve is often there; deployable frameworks and playbooks are not. This article is my first attempt at addressing the second issue. In no way do I claim this is comprehensive or effective. But this is a starting point and I am sure it will evolve as I think and write about it more, and more importantly, as I get feedback from this [community](https://www.financealliance.io/community/). **As any former consultant would, I have packaged this into an acronym: the F-PRA framework: Foundation, Philosophy, Rituals, and Artefacts.** It can be visualized as below: ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/02/data-src-image-52651a96-aa9c-43f2-b034-42979a8dccc4.jpeg) ## **Foundation: Getting the basics right** The foundation is the most critical element of the framework—and the one I will spend the least time on. Not because it is unimportant, but because most organizations already have parts of it in place: defined organizational structures, ownership models, RACI matrices, and performance management systems. A decade of wave of digital transformations has equipped most companies with reasonably mature [KPI](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) definitions and reporting [tools](https://www.financealliance.io/10-best-financial-modeling-tools/). However, having these components is not the same as having a foundation *designed to support the desired PBF process*. If the organization structure and systems cannot support planning, [forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/), and—most importantly—execution, the rest of this framework is irrelevant. One important caveat: as PBF processes evolve, the foundation must evolve with them. Too often, organizations design PBF processes constrained by existing systems and structures, rather than allowing those foundations to adapt to the operating model they actually want. ## **The pillars: Process execution design** ### **1.** **Philosophy** The first question that the CFO (typically in conjunction with the CEO) has to ask is what the PBF design principles are. There are many dimensions to this. **Control vs. autonomy** How much control should be exerted over the commercial teams to execute the plan? Do you want the process to be [top-down](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) (plans made based on goals given by leadership) or bottom-up (a roll up of individual goals) or somewhere in between? A large European bank has institutionalized an ingenious process (and one of the best I have seen) where the PBF processes are driver based but has continuous forums that ensure that both management and field align on the drivers. The [finance team](https://www.financealliance.io/fp-a-team-structure/) acts as a dispassionate party to deliver the numbers purely based on the drivers (very difficult to implement but highly effective if you can get it right). [6 strategies for FP&A to master scenario planning and risk managementHow FP&A can help the organization prepare for potential outcomes, mitigate risk, and remain resilient and forward-focused.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-353.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-5-1.png)](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) **Rigidity vs. flexibility** How frequently should forecasts be refreshed—annually, quarterly, monthly, or continuously? How much latitude should teams have to adapt plans as conditions change? Equinor’s “Ambition to Action” framework represents one extreme: the traditional [annual budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) was eliminated in favor of continuous planning. Each spend is treated as a project, resources are allocated dynamically, and returns drive decisions. At the other end of the spectrum are organizations that lock budgets annually and require teams to justify predetermined top-down targets. **Role of PBF process** Is PBF primarily a tool for setting targets and enforcing accountability? Or is it intended to reflect economic reality as closely as possible and set expectations for shareholders? Or both? The answer fundamentally shapes how the process is designed and used. Ultimately, the key stakeholder to keep in mind is the shareholder. [Risk tolerance](https://www.financealliance.io/risks-of-mergers-and-acquisitions/), [governance](https://www.financealliance.io/finance-and-compliance/) expectations, and desired involvement vary dramatically across ownership models—from founder-led private companies to PE-backed firms, state-owned enterprises, and widely held public companies. When in doubt, the simplest advice applies: ask the board. [Communicating financials to execs: A 5-step approachYou can do a very impressive analysis and still contribute nothing meaningful to decision-making. In my mind, insight is simple: it’s information that decision-makers don’t currently know, and that helps them make better decisions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-354.png)Finance AllianceAnders Liu-Lindberg![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--18-.png)](https://www.financealliance.io/how-to-communicate-financials-to-executives/) ### **2.** **Rituals** Once you have the philosophy nailed down, the next step is to put in place rituals to bring the philosophy to life. The key design drivers within the rituals would be: **Objective of each ritual** Why do we have a ritual: is it to inform, discuss or decide? Or a combination of some or all of these? If it is to decide, which decisions and who will be the decision maker? How? Consensus or executive direction? **Active vs. passive** Would the ritual be a live forum for discussion or an offline update (email, dashboard etc.)? An Indian industrial giant that I worked with to redesign their PBF process was very clear that they did not want any live governance forums between quarters. All plan updates were done offline and business leaders could call their own individual meetings for decision making if required. [Why “operational debt” costs your finance function $100k+ per leaderThe businesses that scale successfully aren’t led by CFOs who take pride in doing everything themselves.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-355.png)Finance AllianceFilip Pesek![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--17--2.png)](https://www.financealliance.io/why-operational-debt-costs-your-finance-100k-per-leader/) **Frequency & triggers** How often should rituals occur? Should certain events trigger ad hoc sessions? A downstream oil company tied reforecasting to petroleum price thresholds; when prices breached predefined ceilings or floors, a reforecast was triggered and discussed with the [CFO](https://www.financealliance.io/top-10-cfo-skills/), and new thresholds were set. **Stakeholders** Who will participate in which sessions? Who will get an update by when? Who can decide and whom do they consult with when they take a decision? Where are they located? Fundamentally, the design of various rituals and their calendarization is driven by the first pillar: the PBF philosophy. A rigid, top-down philosophy might engender a set of more frequent rituals, continuously updated dashboards, with heavier involvement by top management. ### **3.** **Artefacts** Rituals cannot function without relevant artefacts—[presentations](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/), dashboards, reports, or sometimes even just a number. Artefacts are often treated as a tactical afterthought, but this underestimates their importance. Artefacts are the primary interface between data and decision-making, and poorly designed artefacts can materially weaken even well-designed PBF philosophies and rituals. Artefact design is driven by two factors: 1) The nature and objective of the ritual, and 2) What can realistically be measured and reported. [What is a compliance report: A guide on compliance reportingA clear, no-fluff guide to compliance reporting for finance teams who do it all.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-356.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/compliance-report-blog-meta-2-3.png)](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) Designing effective artefacts is as much art as science and is influenced by leadership style, organizational culture, and decision maturity. A useful lens for artefact design is the behavior they induce. Strong artefacts focus attention, surface trade-offs, and accelerate decisions. Weak artefacts create noise, encourage gaming, and slow execution. Some observed reasons for artefact design failures include: - **Signal dilution:** Dashboards overloaded with KPIs dilute attention and shift discussions toward explaining numbers rather than making decisions. - **Narrative dominance:** Excessive context and commentary obscure key trade-offs, turning decision forums into reporting sessions. - **False precision:** Highly detailed forecasts presented with unwarranted certainty create a misleading sense of accuracy, particularly in volatile environments. - **Over-templatization:** Excessive rigidity suppresses nuance and incentivizes teams to fit reality into predefined formats rather than surface emerging risks. Strong artefact design, by contrast, typically exhibits a few consistent characteristics: - **Decision-oriented:** Artefacts clearly indicate what decision is required and by whom. - **Focused:** Emphasis is placed on a small number of critical drivers rather than exhaustive detail. - **Explicit about uncertainty:** Ranges, scenarios, and sensitivities are often more informative than point estimates. - **Aligned to accountability:** Ownership of assumptions and outputs is unambiguous. One European financial institution I worked with enforced strict artefact standardization, trading flexibility for faster reviews, clearer escalation, and more disciplined governance. In other organizations, particularly those emphasizing autonomy, lighter templates combined with strong [narrative](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/) expectations proved more effective. Ultimately, artefacts must be designed in service of the rituals they support and the philosophy they embody. Treating artefact design as a low-value or cosmetic exercise overlooks its real role: shaping how leaders interpret reality and how effectively they act on it. [How to transform financial data into compelling storiesFP&A professionals have to understand the business deeply. We’re not just reporting results or explaining variances. We are taking on part of the decision-making burden.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-358.png)Finance AllianceLewis Danby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--5--3.png)](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) ## **Conclusion** Sitting above the framework is its ultimate purpose: PBF outcomes (the roof in the framework). Every element—foundation, philosophy, rituals, and artefacts—should serve the needs of stakeholders, particularly shareholders. These outcomes may include earnings guidance, capital allocation decisions, pricing support, or broader strategic objectives. Two closing thoughts bear repeating: - The organizational and systems foundation should evolve based on the chosen PBF design, not constrain it. - This framework represents an initial codification, not a finished product. I welcome feedback, perspectives, and challenges that can help refine and strengthen it over time. --- [How finance leaders govern healthcare spend | Live sessionPractical insight for finance leaders to gain independent visibility and govern healthcare spend more effectively.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-359.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/DO-NOT-OVERRIDE-PMA_Webinar_Meta_Template_--3-.png)](https://www.financealliance.io/how-finance-leaders-govern-healthcare-spend/) ### How generative AI is transforming finance (from automated reports to synthetic data) URL: https://www.financealliance.io/how-generative-ai-is-transforming-finance/ Last updated: 2026-02-05T09:58:31.000Z A [comprehensive new study](https://onlinelibrary.wiley.com/doi/full/10.1111/exsy.70018) reveals how technologies like GANs, VAEs, and specialized language models are reshaping everything from fraud detection to portfolio management. Unlike general AI tools, these systems are being designed to handle the unique complexities of [financial data](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/), terminology, and regulations. [AI in FP&A: What you need to knowAI in FP&A won’t make you or your role obsolete. But it will help automate routine tasks and give you more time for strategic initiatives.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-345.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles-7.png)](https://www.financealliance.io/ai-in-fp-a/) ## **Moving beyond automation to autonomous finance** The paper introduces a compelling vision: autonomous finance. This goes beyond simple task automation to systems that can self-learn, self-correct, and make independent decisions based on the data they collect. Think of it as the difference between a [calculator](https://www.financealliance.io/ebitda-calculator-guide/) that follows your instructions and an analyst who can spot patterns, flag concerns, and suggest strategies. The researchers note that generative AI will enable businesses to automate specific tasks that are labour-intensive and focus their time and resources on more strategic objectives. But they're careful to emphasize that this [isn't about replacing human judgment](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/). Instead, they envision a hybrid approach where AI handles data aggregation and initial analysis while humans retain final decision-making authority. The shift is already happening. Morgan Stanley uses OpenAI-powered chatbots that tap into internal research databases to assist [financial experts](https://www.financealliance.io/top-10-fp-a-skills-to-master/). Bloomberg has developed BloombergGPT, trained specifically on financial data to understand industry jargon and context better than generic models. ## **Solving finance's data dilemma with synthetic generation** One of the most innovative applications highlighted in the research is synthetic data generation. Financial institutions face a constant challenge: they need vast amounts of data to train AI models, but customer information is highly regulated and sensitive. The solution? Generative Adversarial Networks (GANs) that can create realistic but entirely artificial financial datasets. These synthetic datasets maintain the statistical properties of real data without containing any actual customer information. American Express's AI lab is already using this approach to enhance fraud detection models, addressing what researchers call the "class imbalance problem" where fraudulent transactions are rare compared to legitimate ones. This isn't just about compliance. The paper reveals that JPMorgan's AI Research division views synthetic data as crucial for enabling collaboration and testing that would be impossible with real customer data. It allows teams to share datasets across departments and even with external partners without privacy concerns. [AI and data analytics-driven finance transformationThe transformation of the finance function with AI is not a plug-and-play exercise; rather, it calls for a structured approach, commitment toward change, and deep insight into both the technology and nuances of financial operations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-346.png)Finance AllianceArsalan Sheikh![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--19--2-1.png)](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) ## **Real products delivering real results** The research documents several generative AI products already in use or development: ### **BloombergGPT** [BloombergGPT](https://www.bloomberg.com/company/press/bloomberggpt-50-billion-parameter-llm-tuned-finance/) stands out as a prime example of domain-specific AI. Trained on Bloomberg's vast financial archives, it outperforms generic language models on finance-specific tasks. The key insight here is that financial terminology and concepts require specialized training. A general AI might misinterpret financial jargon or miss crucial context that could affect investment decisions. ### **Finance GPT (GPT-F)** This takes a similar approach, focusing on tasks like financial research, wealth management planning, and personalized investment recommendations. What makes it valuable is its ability to analyze individual risk tolerance and financial goals while drawing on patterns from vast amounts of market data. ### **AlphaSense Smart Summaries** [This tool uses generative AI](https://www.alpha-sense.com/platform/smart-summaries/) to not just search financial documents but to synthesize and summarize relevant information from company filings, research reports, and news articles. For hedge fund analysts tracking dozens of companies, this transforms hours of reading into minutes of review. ### **JPMorgan's IndexGPT** This tool promises to democratize investment selection. The bank [envisions it as a ChatGPT-like interface](https://www.fif.com/index.php?option=com%5Fcontent&view=article&id=24628&catid=78&Itemid=1749) where regular users can get sophisticated investment advice simply by describing their needs and circumstances. [How banks can mitigate fraud & financial crimes with AIWant to learn how banks mitigate fraud and financial crimes? Discover plenty of take-home tips and strategies to help you use AI in risk management (the right ways) in this in-depth guide.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-347.png)Finance AllianceManoj Tyagi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--62-.png)](https://www.financealliance.io/ai-in-risk-management-how-banks-can-mitigate-fraud-and-financial-crimes/) ## **The limitations keeping humans in the loop** Despite the enthusiasm, the researchers identify several critical limitations that explain why financial institutions are proceeding cautiously. The "black swan" problem looms large. Generative AI models train on historical data and struggle with unprecedented events. The paper notes these programs learn from what has happened in the past, and [they are not great at guessing surprises that have never happened before](https://www.financealliance.io/the-hidden-danger-of-look-ahead-bias-in-financial-llms/). In finance, where sudden market crashes or global disruptions can wipe out portfolios, this limitation is particularly concerning. Explainability presents another challenge. [Financial regulations](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) often require institutions to explain why certain decisions were made. But deep learning models operate as "black boxes," making it difficult to trace their reasoning. This creates compliance risks when AI is used for loan approvals, investment recommendations, or [risk assessments](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/). The cost factor is significant too. Training and maintaining these specialized models requires substantial computational resources. The paper describes them as money-eating machines that constantly need to be fed to keep doing their job well. [How finance is evolving from reporting to innovationIs your finance team seen as a roadblock? Discover how to evolve finance from a cost center to a strategic driver of innovation and growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-351.png)Finance AllianceSiqi Chen![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--8.png)](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) ## **Privacy concerns and the Samsung warning** The researchers highlight the case of Samsung employees [accidentally leaking sensitive data through ChatGPT](https://www.forbes.com/sites/siladityaray/2023/05/02/samsung-bans-chatgpt-and-other-chatbots-for-employees-after-sensitive-code-leak/). This led major banks including JPMorgan, Citigroup, and Deutsche Bank to ban employee use of public AI tools. The concern isn't theoretical. The paper notes that OpenAI employees and third-party contractors can access user-posted information for review. For financial institutions handling enormous amounts of customer data, even one employee entering sensitive information into a public AI tool could cause widespread exposure. ## **What this means for finance professionals** The research suggests we're entering an era of "hybrid functioning" where AI and human professionals [collaborate](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/) rather than compete. For financial analysts, this might mean shifting focus from locating and summarizing information to verifying AI-generated insights and [making strategic decisions](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/). The paper envisions specific changes to various roles. Financial advisors could use AI to generate initial investment recommendations while focusing their expertise on understanding client needs and providing personalized guidance. Compliance analysts might rely on AI to [flag potential regulatory issues](https://www.financealliance.io/finance-and-compliance/) while applying judgment to complex situations. Several emerging applications show particular promise. The use of AI for "applicant-friendly" loan denials, where complex algorithmic decisions are translated into simple, empathetic language, demonstrates how the technology can improve customer relations. Similarly, AI-powered fraud detection that can adapt to new types of fraud more quickly than traditional rule-based systems offers clear operational benefits. [Cost-benefit analysis: 5 steps to turn data into smarter choicesIf you want to learn more about what cost-benefit analysis is and how to do it, keep reading as we dive into five key steps to streamline your financial evaluations and drive smarter decisions. 🧠![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-349.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--6--3.png)](https://www.financealliance.io/cost-benefit-analysis/) ## **Looking ahead: the path to autonomous finance** The researchers conclude that while fully autonomous finance isn't yet viable, the building blocks are falling into place. The key is developing domain-specific models trained on [financial data](https://www.financealliance.io/financial-charts-and-graphs/), implementing robust privacy protections, and maintaining human oversight for critical decisions. For finance professionals, the message is clear: generative AI isn't just another tech trend to monitor. It's actively reshaping how [financial analysis](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/), risk assessment, and customer service are performed. Understanding these tools, their capabilities, and their limitations will become essential for [career development](https://www.financealliance.io/fast-tracking-your-fp-a-career/). The paper makes one thing certain: the question isn't whether generative AI will transform finance, but how quickly professionals and institutions can adapt to harness its benefits while managing its risks. As the technology evolves from [generating simple reports](https://www.financealliance.io/how-to-communicate-financials-to-executives/) to enabling complex financial decisions, those who understand both its power and its pitfalls will be best positioned to thrive in this new landscape. --- [**Sign up to our (free) Insider membership**](https://www.financealliance.io/insider-membership-plan/) **to get exclusive content and ondemand access to hours of real-world case studies.** [Free Finance Alliance Membership - Become an InsiderJoin 1,000s other finance professionals and test drive your Finance Alliance membership without spending a dime.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-350.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Membership_Meta_Images_3-2.png)](https://www.financealliance.io/insider-membership-plan/) ### How to turn forecasting & budgeting mistakes into milestones URL: https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/ Last updated: 2026-02-02T11:55:39.000Z Have you ever made a mistake in your [forecasting or budgeting](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) process? You're not alone. Mistakes happen to the best of us, but instead of dwelling on them, these errors can be turned into opportunities for [growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/). By learning from them, you can strengthen both your own skills *and* your [FP&A function](https://www.financealliance.io/building-an-fp-a-function-strategies-for-effective-team-and-organizational-structure/). ## **The role of FP&A in corporate strategy** Now, let’s dive into the role of [FP&A](https://www.financealliance.io/top-10-fp-a-skills-to-master/) within a corporate strategy. One of the themes we consistently emphasize with our clients and portfolio companies is the importance of moving beyond just numbers. FP&A should drive toward specific, tangible goals that align with the company’s overall strategy. Often, when we ask companies about their corporate strategy, the responses are vague things like [mission statements ](https://www.financealliance.io/cfo-mission/)or large market opportunities. While that’s a good starting point, the real work begins when we break down how to achieve those goals. FP&A plays a critical role in identifying key milestones, pivot points, and ensuring that the organization is structured in a way that holds people accountable for achieving those milestones. Even in small, early-stage companies, silos can quickly develop, and the workload often overwhelms teams. This is why a strong [FP&A function](https://www.financealliance.io/building-an-fp-a-function-strategies-for-effective-team-and-organizational-structure/) needs to be implemented as soon as there’s data to analyze and actions to take. FP&A should act as a hub, synthesizing information from various parts of the organization and feeding it *back* to the right [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) to ensure everyone understands how their role contributes to the company’s success. [Fast-track your FP&A career with tips, success stories, and networking strategiesFP&A is not always a clearly signposted career path, and for many people, myself included, it’s something you only really understand once you’re already in the world of work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-340.png)Finance AllianceJon Yuregir![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--15-.png)](https://www.financealliance.io/fast-tracking-your-fp-a-career/) ## **What is the corporate strategy?** The corporate strategy is the long-term plan of action designed to achieve the [goals and objectives](https://www.financealliance.io/10-big-picture-financial-planning-steps/) of a company. A strong corporate strategy should be aligned with the company’s core competencies, or its unique strengths and capabilities that give it a competitive advantage in the marketplace. A comprehensive corporate strategy will also consider capital requirements a company needs to realize its goals. ## **Implementing FP&A** When it comes to implementing an [FP&A function](https://www.financealliance.io/the-finance-function-of-the-future/), the first step is aligning it with the company’s corporate strategy. This often involves cleaning up historical data, an area where companies that delay FP&A implementation face more [challenges](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/). From there, we conduct baseline analysis to see how far the company is from its stated goals and whether those goals are realistic given the current data. Once this groundwork is done, we can launch the initial [forecast](https://www.financealliance.io/rolling-forecast-best-practices/) and begin the regular FP&A workflow, which includes variance reporting, error testing, and re-baselining. A lot of this early work focuses on cleaning up processes, implementing the right systems, and creating a continuous flow that helps the organization adapt and grow. Here are the steps of a typical FP&A implementation process: 1\. Define corporate strategy and organizational goals 2\. Historical data clean-up/assumptions gathering 3\. Initial/baseline analysis 4\. Verify goals and timelines of corporate strategy 5\. Launch initial forecast 6\. Conduct initial [variance reporting](https://www.financealliance.io/the-variance-analysis-cycle/) 7\. Error testing/root cause analysis (RCA) 8\. Re-forecasting and continuous improvement ## **Areas covered in outsourced FP&A process** Many early-stage companies, especially those without robust systems in place, struggle to organize and analyze their data. We help these companies compile their data into an actionable format, perform trend and [KPI analysis](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/), and ultimately support better decision-making. It’s important to note that even mature companies sometimes struggle to utilize KPIs effectively. It’s not enough to say, “*We lowered this expense, so our KPI improved*.” What’s more important is understanding the broader context; what those numbers mean in a dynamic environment and how they affect the company’s long-term goals. Here's a breakdown of the areas covered in outsourced FP&A processes: - **Financial planning**: Developing long-term financial plans and [forecasts](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) based on a company’s goals and resources. - **Budgeting**: Assisting in the creation of an [annual budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) and regular monitoring actual results against budget. - **Cost management**: Analyzing and recommending ways to [reduce costs](https://www.financealliance.io/how-fp-a-teams-calculate-and-reduce-customer-churn/), improve efficiency, and increase profitability. - **Risk assessment**: Identifying and evaluating financial risks, and recommending strategies to mitigate them. - **Data extracting, transforming and loading**: Compiling existing internal and external datasets that will inform the planning and analysis process. - **Financial reporting**: Providing regular financial reports that summarize the company’s financial position and performance, including income statements, balance sheets, and [cash flow](https://www.financealliance.io/cash-flow-drivers-in-a-business/) statements. - **Performance analysis**: Analyzing past and current financial performance to identify trends, strengths, and weaknesses. - **Decision support**: Providing financial analysis and recommendations to support strategic and operational decision making. ## **Why FP&A is necessary** Even in small organizations, the need for FP&A is clear. Traditional organizational structures (where information flows top-down) can be slow and inefficient, *especially* in fast-paced industries. FP&A helps streamline communication, ensuring that critical information is available to all stakeholders in real-time. This prevents delays and miscommunications that can seriously hinder a company’s progress. Without a mechanism in place to centralize, analyze, and disseminate key business data, the organization risks isolating its different functions and losing access to critical information that should be used to inform business [strategy](https://www.financealliance.io/10-structured-capital-strategies/). ## **Case studies: Lessons from the field** Let’s move on to some [case studies](https://www.financealliance.io/tag/case-studies/) that illustrate the value of FP&A in different contexts. ### **The growth-stage SaaS company** One of our portfolio companies, a B2B2C SaaS business, was growing rapidly but struggling to secure funding due to mixed messaging. They had the right [metrics](https://www.financealliance.io/32-cfo-kpis/), but they were tailoring their story differently for each potential investor. We helped them refine their narrative and focus on the key KPIs that truly mattered, leading to a successful raise and a more efficient operating structure. [Claude in Excel: What the new Pro rollout means for financeExcel isn’t going anywhere. The question is whether your next model build is going to feel like 2009 or like 2026.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-341.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--8-.png)](https://www.financealliance.io/claude-in-excel-for-finance/) ### **The mature PE-owned business** Another client, an older company owned by a PE firm, was experiencing flat sales and product misalignment. Despite having excellent data, the company’s [leadership](https://www.financealliance.io/cfo-leadership-pillars/) had unrealistic expectations about future funding. We helped them refocus on internal improvements and identify customer segments that were still performing well. This led to a more aligned product roadmap and operational success, though not without some necessary cuts. ### **The consumer product company** A consumer product company we worked with had recently added a subscription service to complement their physical products. This was essentially a whole new revenue model, and they needed help navigating the complexities of managing both models simultaneously. We guided them through the process of managing their cash flow and prioritizing high-margin opportunities, which ultimately set them up for long-term success. [How to create a revenue plan that doesn’t fall apart by Q3This blog will walk you through the main components of a revenue plan, what good revenue planning involves, when to start and how to put together a plan that gets results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-342.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--13.png)](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) ## **Key takeaways** From these case studies, several common lessons emerge: ### **1\. FP&A needs clear goals and accountability** Without defined corporate goals, [FP&A](https://www.financealliance.io/fp-a-team-structure/) can feel hollow. It’s crucial to segment accountability and measure progress toward specific objectives. ### **2\. All investments must have an expected return** Every expense is an [investment](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/) with an expected return. FP&A must hold the organization accountable for tracking those returns. ### **3\. Measure what matters** Even if something seems difficult to quantify, it’s important to create parameters and measure progress. ### **4\. Signal vs. noise** The longer you delay measuring important metrics, the harder it is to clean up the data later. Without [measurement](https://www.financealliance.io/32-cfo-kpis/), initial biases can cloud decision-making. Finally, it’s essential to meet organizations where they are. Whether you’re working with entrepreneurs or internal [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/), it’s important to pace change and ensure everyone is aligned with the goals and processes that will drive long-term success. ## **The future of FP&A** As FP&A leaders, our role is expanding. The finance function is increasingly positioned at the center of organizational strategy, and it’s critical that we embrace this responsibility. By fostering intellectual curiosity and going deeper into the goals of different departments, we can become true leaders in driving the company’s success. While FP&A may not always get the spotlight like a big sales win or new product launch, its impact compounds over time. Building coalitions, driving accountability, and contextualizing decisions are key to ensuring the long-term success of any organization. --- *This article is based on a presentation given by* [***James Manning***](https://www.linkedin.com/in/james-mannering-398129100/)*,previous Director of FP&A at York IE at our FP&A Summit. As a Pro or Pro+ Member, you can watch James' full speaking session On-Demand right* [***here***](https://www.financealliance.io/fp-a-summit-boston-october-2023/?wchannelid=cao9uuwy3f&wmediaid=dk8i76ktva)*.* --- **If you work in finance, we want to hear from you!** [**This survey**](https://www.financealliance.io/finance-alliance-salary-survey/) **is your chance to see where you stand compared to your colleagues and peers in similar roles, industries, and regions.** [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-343.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-14.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### Business travel is expensive again (but that doesn’t mean you have to overpay) URL: https://www.financealliance.io/business-travel-is-expensive-again-but-you-dont-need-to-overpay/ Last updated: 2026-01-28T08:47:15.000Z For a while, business travel [budgeting](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) felt almost theoretical. Trips were limited. Volumes were unpredictable. And [finance teams](https://www.financealliance.io/why-finance-teams-struggle-to-act-on-their-data-and-how-to-fix-it/) quietly accepted higher prices as the cost of simply getting people back on the road. That phase is over. Business travel has fully reasserted itself as a major line item, one that now comes with renewed scrutiny, tougher internal questions, and far less tolerance for “that’s just what it costs now.” But here’s the part that doesn’t show up in headlines: higher travel spend doesn’t automatically mean higher travel prices. Not everywhere. Not across every category. And not for teams that know how to read the market signals hiding beneath the surface. [**Recent data from Emburse**](https://www.financealliance.io/2025-business-travel-snapshot-where-to-find-savings-in-your-2025-travel-budget/) paints a picture of a travel landscape that looks expensive at first glance, but behaves very differently once you dig in. And for finance teams paying attention, that difference matters. [![CTA Image](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/01/FA_Whitepaper_Social_Asset.png)](https://www.financealliance.io/2025-business-travel-snapshot-where-to-find-savings-in-your-2025-travel-budget/) Inside the [Business Travel Snapshot](https://www.financealliance.io/2025-business-travel-snapshot-where-to-find-savings-in-your-2025-travel-budget/), you'll find: - Stabilizing rates and new pricing opportunities - A clear picture of returning business travel demand - How NDC and AI are evolving from buzzwords to real savings levers - Geography matters more than ever - Forces reshaping program design [This is where savings are hiding in plain sight ](https://www.financealliance.io/2025-business-travel-snapshot-where-to-find-savings-in-your-2025-travel-budget/) ## **The return of business travel (with unexpected leverage)** There’s no question that business travel activity has accelerated. More trips. More meetings. More pressure on budgets to keep up. What’s surprising is how uneven the recovery actually is. Supplier confidence has returned but not uniformly. Some markets are tightening quickly. Others are struggling with excess capacity, softer leisure demand, or shifting traveler behavior. Airlines are revising distribution strategies. Hotels are experimenting with [pricing](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/) structures that look nothing like what finance teams were used to a few years ago. The result is a travel market that appears strong, but isn’t universally expensive. That imbalance is where leverage lives. ## **Why averages are misleading finance teams** Most travel budgeting still starts the same way: with averages. Average airfare. Average hotel rates. Average year-over-year increases. The problem is that averages smooth out exactly the volatility that creates opportunity. The Emburse data shows wide variation by city, region, supplier, and booking channel. In some places, rates are climbing. In others, they’re flat or quietly declining. Negotiated prices often tell a very different story than market prices, especially for organizations willing to revisit agreements instead of letting them roll forward untouched. When finance teams rely on blended numbers, they end up budgeting defensively, and missing the chance to reallocate spend more strategically. [Grab your free report](https://www.financealliance.io/2025-business-travel-snapshot-where-to-find-savings-in-your-2025-travel-budget/) ## **Airfare is fragmenting** Air travel remains one of the most scrutinized categories in corporate spend, and for good reason. It’s visible, volatile, and often assumed to be uncontrollable. But the data suggests something more nuanced. While market fares haven’t collapsed, negotiated fares have quietly diverged from published prices. In many cases, the gap between what companies *could* be paying and what they *are* paying has widened, especially for organizations that actively manage airline relationships rather than accepting default terms. At the same time, airline distribution models are in flux. Some carriers are pushing aggressively into newer booking channels. Others are adjusting [strategies](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) after discovering that corporate buyers are more willing to shift loyalty than expected. For finance teams, this creates a rare dynamic: suppliers that still need volume, combined with pricing models that reward flexibility and attention. That’s not chaos, that’s leverage. ## **Hotel pricing looks calm until you zoom in** On paper, hotel pricing appears stable. Growth has slowed. Extreme spikes have moderated. Compared to recent volatility, things look almost predictable. But stability at the macro level masks significant movement underneath. Some cities are experiencing strong rebounds in corporate demand. Others are dealing with excess inventory, changing group travel patterns, or reduced leisure pressure. Even within the same hotel brand, pricing behavior can vary dramatically based on location and traveler mix. Many travel programs still negotiate hotels at a high level (brand-wide, region-wide, or portfolio-wide) and assume consistency where it doesn’t exist. For finance teams willing to get more granular, that assumption can be costly. ## **The quiet budgeting mistake that keeps repeating** Here’s what the [data](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) makes clear: the biggest risk in today’s travel market is complacency. Too many organizations are: - Carrying forward agreements signed under very different conditions - Treating negotiated rates as static instead of dynamic - Using travel data for reporting instead of leverage In a market where supplier strategies are shifting and pricing power is uneven, doing nothing is a decision, and usually an expensive one. The teams that struggle most aren’t the ones traveling more. They’re the ones assuming the market has already made its move. [See where you can save](https://www.financealliance.io/2025-business-travel-snapshot-where-to-find-savings-in-your-2025-travel-budget/) ## **Precision matters more than restraint** When travel budgets rise, the instinct is often to clamp down: restrict trips, tighten approvals, delay negotiations. But the data suggests that restraint alone doesn’t create savings. Precision does. Organizations that perform best are the ones that understand: - Which cities and routes behave differently than the average - Where negotiated [pricing](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/) has quietly improved - Which suppliers are signaling vulnerability and which aren’t Instead of asking, “How do we spend less on travel?” they ask, “Where are we overspending without realizing it?” That shift in mindset changes everything. ## **This isn’t a warning, but an opportunity** It’s easy to frame rising travel spend as a threat. And for teams relying on outdated assumptions, it can be. But for [finance leaders](https://www.financealliance.io/top-10-cfo-skills/) willing to engage with the data, the current landscape offers something rare: a chance to regain control without sacrificing movement, growth, or connection. Not by cutting travel, not by freezing budgets. But by negotiating smarter, budgeting with intent, and questioning averages that no longer tell the full story. ## **Want to see where the savings actually are?** The [**Business Travel Snapshot**](https://www.financealliance.io/2025-business-travel-snapshot-where-to-find-savings-in-your-2025-travel-budget/)breaks down what’s really happening across air and hotel spend, and where finance teams still have room to maneuver. If you’re heading into budget planning, supplier negotiations, or leadership conversations about travel costs, this is insight worth having before decisions get locked in. 👉 [**Read the full business travel snapshot**](https://www.financealliance.io/2025-business-travel-snapshot-where-to-find-savings-in-your-2025-travel-budget/) **to see where savings are hiding in plain sight.** [Business Travel Snapshot, by Emburse | Free downloadGet the report and start building a smarter, more resilient travel program for the year ahead.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-339.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Emburse-2--1--2.png)](https://www.financealliance.io/2025-business-travel-snapshot-where-to-find-savings-in-your-2025-travel-budget/) ### Claude in Excel is here: What the new Pro rollout means for finance teams URL: https://www.financealliance.io/claude-in-excel-for-finance/ Last updated: 2026-01-26T09:43:44.000Z [Claude in Excel is now available on Pro plans](https://claude.com/claude-in-excel), a meaningful expansion for finance professionals who live inside spreadsheets all day. Alongside broader access, the update introduced a set of workflow upgrades that sound small at first glance, but solve problems that show up constantly in real finance work: - Bringing in multiple supporting files at once, - Making safer edits that don’t overwrite your existing cells, and - Keeping long analysis sessions usable through auto compaction. If you’ve ever tried to [use an AI assistant while working on a model](https://www.financealliance.io/copilot-vs-claude-for-excel-which-ai-assistant-wins-for-formula-building/), you know the friction points: you spend time explaining context it can’t “see,” you worry it might destroy your structure, and you hit a wall when the conversation gets too long and the assistant starts forgetting earlier assumptions. Claude in Excel is aiming directly at those realities, by meeting analysts, [FP&A teams](https://www.financealliance.io/fp-a-team-structure/), and investment professionals where the work actually happens. > Claude in Excel is now available on Pro plans. > > Claude now accepts multiple files via drag and drop, avoids overwriting your existing cells, and handles longer sessions with auto compaction. > > Get started: [pic.twitter.com/yt9Gy2HLY3](https://t.co/yt9Gy2HLY3) > > — Claude (@claudeai) [January 23, 2026](https://twitter.com/claudeai/status/2014834616889475508?ref%5Fsrc=twsrc%5Etfw) ## **Excel is still the operating system of finance** Finance runs on Excel for a reason. Spreadsheets are more than just a tool for calculations, they’re how teams express assumptions, connect operating drivers to outcomes, and [communicate](https://www.financealliance.io/how-to-communicate-financials-to-executives/) decision-ready insights. In practice, that means Excel work is rarely a single clean dataset. It’s a bundle of interdependent tabs, historical exports, sanity-check schedules, and “do not touch” sections that only one person truly understands. The model is part math and part institutional memory. Claude in Excel is built to work inside that reality: it can understand a workbook with nested formulas and dependencies across multiple tabs, then explain what it’s doing with references back to specific cells. This matters because [finance](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/) isn’t just about getting an answer. It’s about being able to defend it. [The FP&A Journey: From Excel to AIChart your course from static reporting to strategic guidance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-332.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FAnow---June-21--1--1.png)](https://www.financealliance.io/fp-a-journey-from-excel-to-ai/) ## **What Claude in Excel actually does (in finance terms)** At a high level, Claude in Excel is an Excel add-in that opens a Claude assistant alongside your workbook, so you can ask questions and make changes without leaving the spreadsheet environment. Anthropic positions it as a tool that can understand the workbook end-to-end, explain formulas and calculation flows, and help you update assumptions while keeping the model structure intact. That framing is important: it’s not “AI that does Excel for you.” It’s more like an analyst who can read the whole workbook quickly, follow instructions precisely, and walk you through how your model behaves. From a finance workflow standpoint, the most valuable capabilities fall into four buckets: model comprehension, scenario work, debugging, and [templated](https://www.financealliance.io/templates-frameworks/) build-out. Claude can answer questions about specific formulas, entire worksheets, or calculation logic across tabs, and it provides cell-level references so you can trace the reasoning back to where it came from. That is especially useful when you inherit a model, come back to a file after weeks away, or need to validate what’s driving a surprising output. Claude can also support scenario testing in a way that’s designed to preserve your dependencies rather than breaking them, with transparency into what changed. If you’re running sensitivities across [revenue growth](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/), margin assumptions, or working capital dynamics, that kind of guided editing can save time while keeping you in control. And when something breaks (as it always does in Excel) Claude can help trace errors like #REF!, #VALUE!, or circular references back to the source and explain the fix. Anyone who has ever watched a model collapse five minutes before a meeting understands how valuable “faster debugging” really is. Finally, Claude can help build draft models or fill templates with fresh data while maintaining structure and formulas. This is especially [relevant for teams](https://www.financealliance.io/why-finance-teams-struggle-to-act-on-their-data-and-how-to-fix-it/) who reuse standardized templates across clients, business units, or investment memos. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/01/data-src-image-876d65ee-730b-45aa-9b9e-eadf9a85b0c5.png) Source: [Claude](https://claude.com/claude-in-excel) ## **The 2026 upgrades that matter most** This announcement wasn’t just about access. It highlighted **three improvements** that directly target common Excel pain points in finance workflows: - Multiple file drag-and-drop uploads, - Safer non-overwriting edits, and - Auto compaction for longer sessions. ### **Multiple file drag and drop: finally, real context** [Finance analysis](https://www.financealliance.io/tag/fp-a/) rarely lives in one workbook. If you’re doing [FP&A](https://www.financealliance.io/top-10-fp-a-skills-to-master/), you might have a budget file, a forecast file, a headcount roster, and a separate export from your ERP. If you’re in [banking](https://www.financealliance.io/the-rise-of-banking-as-a-service-transforming-the-financial-landscape/), you might have a working model, a CIM, and a handful of supporting schedules. If you’re in investing, you might have management reporting, [KPI](https://www.financealliance.io/32-cfo-kpis/) dashboards, and a copy of last quarter’s assumptions. Being able to drag and drop multiple files into Claude in Excel means you can supply supporting context without turning your workflow into an administrative task. In practical terms, this makes it easier to do the kind of work [finance teams](https://www.financealliance.io/why-finance-teams-struggle-to-act-on-their-data-and-how-to-fix-it/) actually do: You can reconcile drivers across different files, check whether a [revenue](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/) bridge aligns with a historical export, or compare new assumptions to a prior forecast. The benefit isn’t just convenience, but that analysis improves when the assistant has more of the supporting evidence in one place. ### **Avoids overwriting your existing cells: safer assistance inside live models** Most finance professionals don’t fear change. They fear *uncontrolled change*. Spreadsheets are fragile because they’re interconnected. One accidental paste or a misplaced hardcode can ripple across the whole model. That’s why experienced analysts develop defensive habits: duplicate tabs, version files obsessively, protect sheets, and avoid unnecessary edits. Anthropic’s update emphasizes that Claude now avoids overwriting your existing cells, which is exactly the kind of “boring” feature that determines whether something is usable in production finance work. This aligns with the broader positioning of Claude in Excel around transparency and formula integrity, keeping structure and formatting intact, and showing changes with explanations. For finance teams, safer edits mean you can use Claude for what it’s best at (speeding up reasoning and reducing manual work) without constantly worrying that it might damage the underlying model. [How finance is evolving from reporting to innovationIs your finance team seen as a roadblock? Discover how to evolve finance from a cost center to a strategic driver of innovation and growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-333.png)Finance AllianceSiqi Chen![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--7.png)](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) ### **Auto compaction: long sessions without losing the thread** Finance work doesn’t fit into short conversations. A real modeling session might involve iterating through assumptions, validating outputs, documenting changes, and preparing a final deliverable. The conversation is the work. But long [AI](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) sessions historically create a problem: context grows, memory gets messy, and at some point the assistant either slows down or starts forgetting what was agreed upon earlier. The update notes that Claude can now handle longer sessions with auto compaction. In plain terms, that means the assistant can manage long back-and-forth workflows more reliably without you constantly re-explaining what matters. For finance, this is not a luxury feature. It’s what makes the tool viable for multi-step analysis, especially when you’re doing scenario work, building a narrative around the numbers, or auditing the logic in an inherited model. ## **Where Claude in Excel fits into finance workflows** Claude in Excel isn’t replacing analysts, but the parts of analysis that are repetitive, error-prone, and slow. ### **Financial planning and analysis** In FP&A, model comprehension is often the hidden time sink. Teams spend days every quarter reacquainting themselves with files that contain years of assumptions and legacy logic. Being able to ask questions like “what assumptions drive the Q3 revenue [forecast](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/)?” inside the spreadsheet can shrink that ramp-up time and reduce dependency on institutional memory. ### **Investing and corporate development** Scenario testing can become tedious because every sensitivity introduces risk. You want to explore outcomes quickly, but you also need to preserve the integrity of your core structure. Claude’s scenario-edit workflow is explicitly designed to update assumptions while maintaining dependencies, which is exactly what you want when testing terminal value, [growth](https://www.financealliance.io/guide-to-company-growth/) rates, or margin ramps. ### **Banking and deal execution** The value of faster debugging is obvious. When outputs break, you don’t need creativity, you need answers. Tracing the root cause of errors and fixing them without derailing the entire workbook is a practical win. ### **For finance teams overall** And in any finance team that operates with standard templates (valuation models, monthly [reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) packs, KPI dashboards) Claude’s ability to help populate templates and maintain structure can cut down the most mind-numbing parts of the job, without sacrificing standards. [Business process optimization: 5 inefficiencies to eliminate5 process inefficiencies you should try to eliminate. By streamlining these areas, you can create a ripple effect of efficiency gains across the entire company.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-334.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--3-.png)](https://www.financealliance.io/business-process-optimization/) ## **Trust, transparency, and the “finance-grade” requirement** Finance doesn’t have room for black boxes. That’s why Claude’s emphasis on cell-level citations is a signal that the [workflow](https://www.financealliance.io/17-finance-business-processes/) is built around verification. Claude can explain formulas and reference exactly which cells it used, giving analysts a way to audit the logic instead of blindly accepting it. Anthropic also makes sure to mention that Claude can make mistakes and that you should review changes before finalizing anything, particularly for client-facing deliverables. That warning makes it more credible. The best [finance tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/) acknowledge the difference between a draft and a final. For organizations that care about governance, Claude in Excel is positioned to work within existing compliance frameworks, which is essential for teams operating under internal controls and audit requirements. ## **Getting started (and what to expect)** Claude in Excel is currently in beta and available to Pro, Max, Team, and Enterprise plans, according to [Anthropic’s official documentation](https://claude.com/claude-in-excel). The add-in is installed through Microsoft’s marketplace listing, and it runs as a sidebar experience inside Excel. Anthropic also highlights keyboard shortcuts to open the add-in quickly: Control+Option+C on Mac and Control+Alt+C on Windows. From a finance team adoption standpoint, the right expectation is that Claude in Excel works best when you treat it like a highly capable junior analyst: fast, helpful, and tireless, but still requiring supervision, especially for critical outputs. ## **The bigger shift: AI that works inside the spreadsheet, not outside it** Most AI tools in finance have followed one of two patterns. Either they sit outside Excel and require you to copy/paste inputs and outputs, or they try to replace Excel entirely with a new [modeling](https://www.financealliance.io/10-best-financial-modeling-tools/) environment that no one asked for. Both approaches add friction. Both create adoption barriers. Claude in Excel is interesting because it’s not asking finance teams to change their system of record. It’s meeting them inside it. And that’s why the latest improvements matter. Multi-file upload makes the assistant more context-aware. Non-overwriting edits make it safer. Auto compaction makes it usable over the length of a real [analysis](https://www.financealliance.io/cost-benefit-analysis/) session. These aren’t gimmicks. They’re the difference between a tool that demos well and a tool that finance professionals actually keep open. [AI in FP&A: What you need to knowAI in FP&A won’t make you or your role obsolete. But it will help automate routine tasks and give you more time for strategic initiatives.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-335.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles-6.png)](https://www.financealliance.io/ai-in-fp-a/) ## **Final take** Claude in Excel is a clear signal that [AI assistants](https://www.financealliance.io/copilot-vs-claude-for-excel-which-ai-assistant-wins-for-formula-building/) are moving beyond chat windows and into the core tools that run finance teams. With broader access on Pro plans and workflow upgrades designed for real spreadsheet work, it’s now much easier for finance experts to experiment with AI assistance without changing how they build and maintain models. For analysts, it means less time untangling inherited logic and more time interpreting results. For [finance leaders](https://www.financealliance.io/financial-leadership-in-changing-times-2/), it means faster iteration cycles and fewer errors hiding in the weeds. And for teams that care about governance, the emphasis on cell-level traceability and reviewability is a step in the right direction. Excel isn’t going anywhere. The question is whether your next model build is going to feel like 2009 or like 2026. --- **If you haven't already,** [**sign up to our (free) Insider membership plan**](https://www.financealliance.io/insider-membership-plan/) **to get access to exclusive content and key insights from finance leaders worldwide.** [Free Finance Alliance Membership - Become an InsiderJoin 1,000s other finance professionals and test drive your Finance Alliance membership without spending a dime.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-336.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Membership_Meta_Images_3-1.png)](https://www.financealliance.io/insider-membership-plan/) ### A simpler, safer way to manage FX as you scale URL: https://www.financealliance.io/inside-the-fx-playbook/ Last updated: 2026-02-27T14:24:03.000Z High-growth companies move fast, but foreign exchange volatility doesn’t slow down to keep up. Rapid international growth and multi-currency operations are putting new pressure on finance teams. FX volatility squeezes margins, clouds forecasts, and complicates board conversations. In this free live session, finance leaders from **Tines and Ravelin** share how they manage FX with clarity and confidence, without complexity. Expect practical, real-world lessons from teams who’ve faced the same challenges and built FX processes that scale with growth. ### Why you should attend - **Protect margins and cash flow** by learning how high-growth finance teams reduce the impact of unpredictable FX swings on their P&L. - **Bring clarity to board reporting** by understanding how to explain FX-driven variances and create more predictable financial outcomes. - **Simplify FX management** without adding operational burden, complexity, or unnecessary admin. - **Learn how to hedge with confidence**, even if FX risk management has previously felt intimidating or opaque. - **Leave with actionable steps** you can implement immediately to reduce uncertainty, save time, and improve financial control. --- ### What you’ll learn - The most common FX headaches facing scaling finance teams, and how to avoid them - Practical strategies Tines and Ravelin use to protect margins and smooth operational costs - How to reduce manual FX admin while maintaining control and visibility - How to start small with FX hedging, build confidence, and scale safely - How to future-proof forecasts and planning despite ongoing currency volatility --- ### **Meet the speakers** **Nick Lally*, CFO, Ravelin*** Nick is the CFO and Founder of Ravelin, a leading fraud prevention platform acquired by Worldpay. He brings first-hand experience of scaling a high-growth fintech and navigating FX risk through rapid international expansion. **Peter Coleman, *Finance Lead, Tines*** Peter leads finance at Tines, a fast-growing automation platform. He focuses on building scalable finance operations that support global growth while maintaining predictability, control, and confidence across currencies. ### Communicating financials to execs: A 5-step approach URL: https://www.financealliance.io/how-to-communicate-financials-to-executives/ Last updated: 2026-01-23T14:00:23.000Z Let me start by making one thing clear: this isn’t about AI. You can probably [use AI](https://www.financealliance.io/ai-in-fp-a/) to support parts of reporting, and I’m sure it will continue to play a role in how finance teams work. But what I want to focus on here is something even more important and much more overlooked: communication. Because in my experience, management reporting is one of the biggest missed opportunities in organizations today. Not because finance teams lack [skills](https://www.financealliance.io/top-10-cfo-skills/). Not because they don’t work hard. And definitely not because they don’t have data. It’s missed because [the way we communicate that data](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) too often fails to create understanding, action, and better decisions. I’m happy to be challenged on it, but I genuinely believe that **95% of management reporting stands to be improved**. [Sometimes the slides don’t look great](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/). Sometimes they look “fine,” but they don’t contain the kind of insight that actually influences decisions. And that’s a major problem, because everything we do in business (and honestly, in life) boils down to moments of communication. If we don’t communicate well, all the hard work we did to produce the data is lost in an instant. ## **Why this matters to me** I spent thirteen years at Maersk in various [finance roles](https://www.financealliance.io/podcast/4-roles-every-cfo-must-dominate-changing-role-of-the-cfo/). Later, I helped found the Business Partnering Institute, where we help [finance teams](https://www.financealliance.io/fp-a-team-structure/) create more value through research, learning and development programs, and consulting and interim support. In 2018, I co-authored *Create Value as a Finance Business Partner*, which was one of the first end-to-end books describing what [finance business partnering](https://www.financealliance.io/how-finance-business-partners-drive-value/) really is. It’s not a flashy book. It reads a little like a school book. But when a topic isn’t clearly defined yet, sometimes a “school book” is exactly what’s needed. I’ve also spent a lot of time creating content on [LinkedIn](https://www.linkedin.com/company/finance-alliance). I’m close to 450,000 followers now, and I write a newsletter called *Trends in Finance and Accounting*, with more than 350,000 subscribers. None of that matters for its own sake, but it’s given me a broad view into how finance teams operate globally, and what they struggle with repeatedly. And one struggle shows up everywhere: management reporting rarely works as well as it should. [How finance is evolving from reporting to innovationIs your finance team seen as a roadblock? Discover how to evolve finance from a cost center to a strategic driver of innovation and growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-328.png)Finance AllianceSiqi Chen![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--6.png)](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) ## **The resume problem: why reporting fails faster than we think** A while back, I applied for jobs and used one of those free resume review services. You know the kind: they review for free, then try to sell you improvements afterward. I sent mine in expecting to get a long list of fixes. Instead, they came back and told me they couldn’t find anything they wanted to change. Then they said something that stuck with me: only about **3% of resumes** they review are like that. The reason I remember it isn’t because it felt good. It’s because it reminded me how much resumes and management reporting have in common. Most of them need improvement. And like a resume, a management report gets judged quickly. People don’t sit down calmly and absorb every number. They scan. They react. They look for what matters. And if you lose them early, you lose them completely. ## **The three biggest problems in finance presentations** When I look at most [finance presentations](https://www.financealliance.io/how-color-impacts-your-finance-presentations/), I usually see the same three issues: First, there are too many details. Second, there’s no coherent structure. Third, there’s no apparent recommendation. Finance people can handle detail. We’re trained for it. But most [leaders](https://www.financealliance.io/global-finance-leaders-report-how-to-make-a-bigger-impact-as-a-finance-leader/) and managers in other functions don’t want that level of complexity in a meeting. They want to know how we’re doing and what we should do about it. Most of the time, they don’t need sixty slides to get there. And the structure is often missing. Many presentations follow the same pattern: actuals versus [budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), actuals versus [forecast](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), a few [waterfall charts](https://www.financealliance.io/financial-charts-and-graphs/). But there’s no story connecting the numbers. Numbers are a language, but if we don’t use them to [tell a story](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/), we’re not helping the room move toward a decision. That leads straight to the third issue: a lack of recommendations. Too often, finance teams come in with a report and say, “Here is the information. I’ll answer questions. You decide what to do.” That’s not decision support. That’s data delivery. [Data storytelling for FP&AWhat do Barack Obama, Oprah Winfrey, and Nikki Glaser have in common? They all excel in storytelling...and you can do (yes, even as a finance professional!). Here’s how…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-329.png)Finance AllianceMathew Reynders![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--37--4.png)](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/) _This post is for paying subscribers only._ ### When AI models cheat: The hidden danger of look-ahead bias in financial LLMs URL: https://www.financealliance.io/the-hidden-danger-of-look-ahead-bias-in-financial-llms/ Last updated: 2026-01-22T09:34:26.000Z Remember when you were in school and accidentally saw the answer key before a test? That's essentially what's happening with many [AI models](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) being used for financial trading today. A [new research paper from Mostapha Benhenda](https://arxiv.org/abs/2601.13770) reveals that popular large language models (LLMs) are achieving spectacular trading returns by essentially “cheating”, remembering future stock prices from their training data rather than making genuine [predictions](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/). ## **The $45k GitHub project that exposed a critical flaw** The research centers around an open-source AI trading system that's captured the imagination of developers worldwide. With over 45,000 stars on GitHub, the AI Hedge Fund project lets LLMs act as portfolio managers, making real trading decisions. But when Benhenda tested these AI traders across different time periods, the results were shocking. Standard models like Meta's Llama 3.1 and DeepSeek achieved returns exceeding 44% when trading stocks from 2021. Impressive, but here's the catch: these models had likely seen news articles, market analyses, and retrospective reports about 2021's tech boom during their training. They weren't predicting anything. They were reciting memorized history. When the same models were tested on data from mid-2024 (after their training cutoff), their [performance](https://www.financealliance.io/32-cfo-kpis/) collapsed. DeepSeek's returns dropped by nearly 22 percentage points. That's not a minor adjustment. That's the difference between a successful hedge fund and bankruptcy. [AI in FP&A: What you need to knowAI in FP&A won’t make you or your role obsolete. But it will help automate routine tasks and give you more time for strategic initiatives.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-326.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles-5.png)](https://www.financealliance.io/ai-in-fp-a/) ## **Why bigger isn't always better in financial AI** Here's where things get really interesting. The research uncovered what Benhenda calls the "Scaling Paradox." You'd expect larger, more sophisticated models to perform better, right? Wrong. At least not when they're contaminated with future [knowledge](https://www.financealliance.io/top-10-fp-a-skills-to-master/). The 70-billion parameter version of Llama 3.1 actually performed worse than its smaller 8-billion parameter sibling when faced with genuinely unknown market conditions. Why? Larger models have better memory. They've memorized more specific details about historical stock movements. When NVIDIA surged 190% in 2023, these models didn't just learn general patterns about tech stocks. They memorized that specific fact. Think about it this way: if you're trying to predict tomorrow's weather, would you rather have someone who understands meteorology or someone who memorized last year's weather reports? The memorizer might look brilliant if you test them on last year's dates, but they're useless for actual [forecasting](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/). ## **The solution: Point-in-time models that actually work** Not all hope is lost. The research also tested a family of specialized "Point-in-Time" (PiT) models from a company called PiT-Inference. These models are designed with strict knowledge cutoffs; they literally cannot access information beyond a certain date. The results? While standard models showed massive performance decay between time periods, PiT models maintained consistent returns. Even more encouraging, larger PiT models actually performed better than smaller ones, suggesting that when you remove the contamination of future [data](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/), scale does improve financial reasoning. The largest PiT model achieved over 7% excess returns (alpha) in both test periods, compared to the buy-and-hold baseline. That's the kind of consistent, reliable performance that actual fund managers dream about. ## **What this means for finance professionals** If you're a [CFO](https://www.financealliance.io/top-10-cfo-skills/) or [FP&A professional](https://www.financealliance.io/fast-tracking-your-fp-a-career/) considering AI tools for financial analysis, this research should be a wake-up call. Many vendors claiming revolutionary AI-powered trading systems might be selling you sophisticated memorization machines rather than genuine predictive tools. The paper introduces "Look-Ahead-Bench," a standardized way to test whether an AI model is actually making predictions or just recalling training data. It's like a lie detector test for [financial AI](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/). The benchmark uses two carefully selected time periods and measures how much a model's performance degrades when it moves from familiar to unfamiliar territory. Here's what you should ask any AI vendor: "Has your model been tested for look-ahead bias? What's its alpha decay between in-sample and out-of-sample periods?" If they can't answer these questions, you might be buying an expensive crystal ball that only works in hindsight. ## **The path forward for AI in finance** This research doesn't mean AI is useless for financial applications. Quite the opposite. It shows that when properly designed and tested, AI models can provide consistent value in [portfolio management](https://www.financealliance.io/client-portfolio-fractional-cfo/). The key is ensuring they're making decisions based on patterns and reasoning, not memorized answers. For finance teams looking to leverage AI, the message is clear: be skeptical of spectacular backtested results, demand rigorous temporal testing, and consider specialized models designed for financial applications rather than general-purpose chatbots. The financial markets are perhaps the ultimate test of predictive capability. There's no partial credit for almost getting it right, and there's certainly no value in perfectly predicting the past. As this research demonstrates, the difference between genuine intelligence and sophisticated memorization can be worth millions. The next time someone shows you an AI model with incredible historical trading returns, remember to ask the critical question: is it predicting, or is it remembering? In finance, only one of those abilities will make you money. --- **Wondering what finance salaries look like in 2026? Join your peers in** [**taking part of our annual survey**](https://www.financealliance.io/finance-alliance-salary-survey/) **and help us paint a clear picture of what's happening in finance.** [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-327.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-13.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### The hidden liability: Why "operational debt" costs your finance function $100k+ per leader URL: https://www.financealliance.io/why-operational-debt-costs-your-finance-100k-per-leader/ Last updated: 2026-01-19T09:24:57.000Z As finance leaders, we are the custodians of capital efficiency. We are trained to scrutinize the [P&L for variances](https://www.financealliance.io/financial-charts-and-graphs/), stress-test unit economics, and obsess over cash flow preservation. If a department is bleeding capital through redundant SaaS licenses or inefficient [procurement](https://www.financealliance.io/100-day-procurement-plan-for-finance-leaders/) workflows, we catch it. We audit it. We fix it. But there is one massive line item that rarely makes it onto the balance sheet, even though it creates a drag on [EBITDA](https://www.financealliance.io/ebitda-calculator-guide/) for almost every firm I analyze. I call it "operational debt." It is the accumulated cost of high-value leaders allocating their limited capacity to low-value operational tasks. Unlike financial debt, which sits visibly on the books with a clear interest rate, operational debt is invisible, until it compounds enough to stall strategic execution. A few years ago, I ran my previous agency with a mindset many [CFOs would applaud](https://www.financealliance.io/how-cfos-power-business-strategy/): aggressive leanness. I didn't have an assistant. I managed my own calendar, booked my own travel, and triaged my own inbox. I told myself I was saving the company overhead. I was wrong. I wasn't saving money; I was engaging in "shadow OpEx." By performing $30-an-hour work on a CEO salary, I was effectively paying a 300% premium for administrative labor. [Does job-hopping increase your salary in finance?The question isn’t whether job-hopping increases salary, as it clearly does. The more important question is how and when to move in order to maximise long-term value.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-323.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--6--2.png)](https://www.financealliance.io/does-job-hopping-increase-your-salary-in-finance/) ## **The unit economics of misallocated time** Let's look at the raw data. A comprehensive [Harvard Business School](https://hbr.org/2018/07/how-ceos-manage-time) study tracking 60,000 hours of CEO and executive time revealed a troubling pattern: executives spend up to 55% of their unscheduled time managing email alone. For a CFO or VP of Finance earning $200,000 annually, this administrative burden translates to a significant financial leak. ***Here is the breakdown of the unit economics:*** A leader at that income level costs the business roughly $100 per hour (fully loaded). High-quality administrative support (capable of calendar [management](https://www.financealliance.io/5-change-management-strategies-finance-transformation/), logistics, and basic reporting) costs approximately $30-$40 per hour. Every hour you spend scheduling your own Audit Committee meetings creates a roughly $60-$70 negative variance. Over the course of a year, that differential approaches $63,000, before we even account for the opportunity cost. When you factor in the strategic value lost (the delayed due diligence on an acquisition, the postponed scenario planning, the stalled [ERP](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/) implementation) the cost easily exceeds $100,000 per year. If you saw a variance of that size in any other cost center, you would demand an immediate audit. ## **How to run an "operational debt" audit** If you suspect your finance function is carrying high operational debt, you don't need a consultant to find it. You can run a specialized internal audit next week. I recommend a modified version of the time-motion studies we use when assessing organizational efficiency. It is a 5-day process designed to quantify the "shadow P&L" of your leadership team. ### **Phase 1: The data collection (5 days)** For one standard work week, keep a notepad or a simple spreadsheet open. This is not about minute-by-minute tracking, but "task-switching" tracking. Every time you shift contexts, write down the activity. ### **Phase 2: The leverage classification** At the end of the week, review your log. You must ruthlessly categorize every activity into one of two buckets. Be honest: this is where most leaders *cheat to make themselves feel productive*. **Bucket A: high-leverage (strategic asset).** These are activities that ***only*** you can do, or that directly drive enterprise value. - *Examples:* Capital [allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) strategy, investor relations, [board presentations](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/), risk management decisions, covenant analysis, mentoring direct reports. **Bucket B: Low-leverage (operational expense).** These are activities that are necessary for the business to run, but ***do not require*** your specific level of fiduciary judgment or salary band. - *Examples:* Scheduling meetings (even important ones), sorting email, formatting Excel reports, data entry, travel booking, chasing invoices, basic vendor correspondence. ### **Phase 3: The valuation** Most [finance leaders](https://www.financealliance.io/financial-leadership-in-changing-times-2/) discover that 40-60% of their week falls into Bucket B. Now, apply the formula: *(Weekly Hours in Bucket B) x (Your Hourly Rate) x 52 Weeks = Annual Operational Debt* If you spend 15 hours a week on Bucket B tasks at a rate of $100/hour, your Operational Debt is $78,000. ### **Phase 4: The analysis** This number ($78,000) represents the cost of under-utilizing your primary asset, your own focus. It is effectively a "shadow salary" you are paying yourself to do work that could be done for a fraction of the cost. [How to create a revenue plan that doesn’t fall apart by Q3This blog will walk you through the main components of a revenue plan, what good revenue planning involves, when to start and how to put together a plan that gets results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-324.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--12.png)](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) ## **The governance risk of the "human-AI" gap** Once the audit is complete, the question becomes: how do we clear this debt? Many leaders turn to automation. They have ChatGPT to draft emails and automated tools to book meetings. But for a finance leader, [relying on pure AI](https://www.financealliance.io/ai-in-fp-a/) presents a significant governance risk. AI tools excel at pattern recognition, but they lack fiduciary judgment. An AI scheduler can find a slot for a meeting, but it cannot know that the Audit Chair prefers Tuesday mornings, or that a specific [investor conversation](https://www.financealliance.io/investor-relations-as-a-strategic-driver-of-corporate-value/) requires a 90-minute buffer for preparation because the Q3 numbers are soft. More importantly, there is the security dimension. Finance functions handle sensitive data: bank covenants, payroll, [M&A](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) targets. Inputting this data into public Large Language Models (LLMs) without a governance layer is a compliance nightmare. The most effective model I have observed for finance leaders is a **"human-AI hybrid" stack**. In this model, a skilled Executive Assistant acts as the governance layer, a firewall, between the executive and the AI. - **Data processing:** You don't paste sensitive P&L data into a public chatbot. You hand the raw files to your EA. The EA uses secure, enterprise-grade AI tools to format and visualize the data, verifies the output for hallucinations (a critical step AI cannot do itself), and presents you with the decision-ready report. - **Inbox triage:** AI can filter spam. But an AI-trained EA acts as a gatekeeper. They can look at an email from legal and identify that (based on the context of a current regulatory inquiry) it needs to be flagged to you immediately. ## **From bottleneck to builder** Strategic delegation is a CapEx investment, not an OpEx cost. [CapEx vs Opex | Key differences, examples & why it mattersMaster the difference between CapEx and OpEx to optimize budgeting and drive growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-325.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/capex-vs-opex-1.png)](https://www.financealliance.io/capex-vs-opex/) When a finance leader decides to delegate, they often worry about the "training cost." They say, "*It's faster if I just do it myself*". **That statement is true exactly once**. But by the fiftieth time you are manually reconciling a schedule, you have invested fifty times the effort without gaining any long-term asset. The businesses that scale successfully aren't led by CFOs who take pride in doing everything themselves. They are led by CFOs who ensure everything gets done, which proves fundamentally different from doing everything personally. Run the audit. Check the numbers. As I often tell the founders and finance executives we support at [DonnaPro](https://donnapro.com/), if you don't have an assistant, you are the assistant. And frankly, you are the most expensive assistant your company has ever hired. ### What 30+ years of global consumer leadership taught this CFO about sustainable growth URL: https://www.financealliance.io/how-cfos-can-scale-brands-worldwide/ Last updated: 2026-01-15T11:13:33.000Z *This article is based on Angela Chen’s brilliant talk at our* [*CFO Summit*](https://www.financealliance.io/events/) *when she was the CFO for Mars Veterinary Health.* --- I’m excited to share a few stories and lessons from my career about the [CFO’s role](https://www.financealliance.io/top-10-cfo-skills/) in scaling consumer brands across markets and cultures. When people hear “CFO,” they often think of spreadsheets, budgets, and cost controls; and yes, those are part of the job. But for most of my career, the work has been broader: creating value, [enabling growth](https://www.financealliance.io/guide-to-company-growth/), guiding strategy, and helping organizations stay grounded in purpose while building a business that can win not just next quarter, but over the long term. I’ve spent over thirty years working for global consumer companies across both the United States and Asia. I began as a financial analyst at Taco Bell. Later, I took on my first expat assignment as a young finance manager at Pepsi, sent to China as one of the “foot soldiers” in the cola wars. I served as Asia Pacific CFO for General Mills, helped bring Gap brands from North America into Europe and Asia, and then spent about eleven years as a [CFO](https://www.financealliance.io/the-chief-financial-officer-competency-framework/) at The North Face, one of my proudest assignments. Most recently, I completed a five-year run as the CFO of Mars Veterinary Health. Many people don’t realize this, but Mars, Inc. has quietly become the world’s largest pet care company, and veterinary health is one of the divisions they own (think animal hospitals). **When I talk about “driving global growth,” I’ll admit that’s jargon. What I really mean is: this is how I understood the assignment.** [How to optimize capital deployed for sustainable growthTo truly drive growth, you need to master the art of strategic capital deployment. Our guide will help you to optimize the capital deployed and help transform your financial strategy into a powerful catalyst for real business growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-318.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Stock--2--1.png)](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/) ## **What the modern CFO role really is** The modern CFO role isn’t surprising anymore. [Finance leaders](https://www.financealliance.io/cfo-leadership-pillars/) like to think of ourselves as strategic partners. We are financial stewards. We are value creators. And we are storytellers. That version of the CFO has existed for at least twenty years. Within that, I’ve always tried to focus on one core [responsibility](https://www.financealliance.io/financial-accountability/): identifying the unique value creation drivers of the business. Every business has value drivers, but they’re not generic. They’re specific to context: the capabilities of the organization, the management team, industry dynamics, market maturity, competition, culture, consumer behavior. The “right” answer in one moment can be wrong in another. As a CFO, you can’t operate from a textbook. You have to see what is actually happening and identify what truly moves the needle. Of course, you also have to ensure the business has the right structural economics. And you have to develop what I call a balanced scorecard: measures and practices that go beyond the financials, because scaling globally requires a holistic view. It’s not just about the numbers. There’s always a tension between [profit](https://www.financealliance.io/profit-planning/) and purpose, and leaders have to be able to hold both. One superpower I’ve seen in truly great CFOs (and it’s something I’ve tried to build) is the ability to connect money, ideas, and data. In my most recent role at Mars Veterinary Health, I had finance, [strategy](https://www.financealliance.io/10-structured-capital-strategies/), and [analytics](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) reporting into me. That structure gave me a real chance to connect the three. I’m not saying we did it perfectly, but there are very few seats in the enterprise that can integrate those elements across the whole business. Done well, it becomes a point of difference between good and great. ## **The hardest part: sustainable growth over time** People talk about a growth mindset all the time. But [sustainable growth](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/) is genuinely hard. Anyone can deliver the next quarter. The real question is: can you deliver twenty quarters? That’s where CFOs can keep an organization honest. Part of the job is pitching for, investing in, and optimizing the infrastructure needed for long-term growth. It isn’t glamorous, but it’s foundational. Because a plan without execution is just a binder collecting dust on a shelf. I’ve seen organizations commission a beautiful [strategy deck](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/) (sometimes from firms like McKinsey) and everyone gets excited. But does it come true? Usually it doesn’t, unless someone drives disciplined execution. That’s why I’ve become so focused on what I call “managing what matters.” Early in my career, I tried to manage everything. It can feel responsible, but over time I learned that when you hire great management [teams](https://www.financealliance.io/why-finance-teams-struggle-to-act-on-their-data-and-how-to-fix-it/), you have to let them do their jobs. At the [C-suite level](https://www.financealliance.io/chief-investment-officer-vs-chief-financial-officer/), your responsibility is to focus on what matters for the entire enterprise. For me, that means establishing a cadence of review and [decision-making](https://www.financealliance.io/15-quick-fire-tips-to-boost-your-business-and-commercial-acumen-fast/) so you can constantly recalibrate, reinvest, and course-correct. And you have to ensure the plan is seen through to completion. That follow-through is an unsung part of driving global growth, and it’s often the difference between brands that expand and brands that stall. And there’s one more truth I’ve learned, something that might sound strange coming from a finance leader: to do this work well, you have to lead with both heart and mind. Finance people are analytical and logical. We rely on rigor. But your analytical rigor has to be guided by true purpose and values. That’s what creates a [sustainable business](https://www.financealliance.io/esg-metrics/) for a generation. I didn’t fully understand that until I moved into animal health, where the emotional core of the work is impossible to ignore. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-319.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-11.png)](https://www.financealliance.io/financial-charts-and-graphs/) ## **Three stories that shaped how I lead** Whenever I share these ideas, I try not to make them purely theoretical. Stories are how people remember what matters. **I often anchor my thinking in three stories: one about ice cream, one about a tent, and one about an adorable pup named Gulliver, who became my pandemic pup.** They’re very different, but they all connect back to the same question: how do you scale across markets and cultures in a way that creates [value](https://www.financealliance.io/time-to-value-metric/) and stays true to purpose? ### **Haagen-Dazs and the lesson of globalism going both ways** The first story is about Haagen-Dazs, owned by General Mills; specifically, the green tea matcha flavor. When people think about globalism (especially early in my career, when I worked for Pepsi) globalism often means bringing American goods to emerging markets. I’ll say it plainly: it’s a little egotistical. Over time, my understanding changed. Globalism doesn’t flow in one direction. It flows from region to region. It’s not only exporting Western products outward. It’s also learning from local markets and scaling ideas outward from them. Matcha Haagen-Dazs was created as a joint venture with a Japanese partner to develop a Japan-specific flavor for Japan first, then expand into limited markets across Asia, and eventually globally. Today, in most major urban centers, you can find green tea ice cream. That didn’t happen because someone decided Japan needed an American product. It happened because a local flavor became something the rest of the world wanted. At the time, I was the CFO of General Mills Asia Pacific. I wrote a business plan and pitched multimillions of dollars to build the [procurement](https://www.financealliance.io/100-day-procurement-plan-for-finance-leaders/) and manufacturing capabilities to make best-in-class matcha green tea ice cream. Fine, best-in-class matcha powder is hard to get. It requires the right sourcing, expertise, and investment. That was the lesson: “local” isn’t a limitation. Done well, local becomes the foundation for global. And personally, I had a lot of fun sampling the first pint that came out of the assembly line. [How to transform financial data into compelling storiesFP&A professionals have to understand the business deeply. We’re not just reporting results or explaining variances. We are taking on part of the decision-making burden.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-320.png)Finance AllianceLewis Danby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--5--2.png)](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/) ### **The North Face and making the outdoors locally relevant** The second story is about The North Face, and it starts with one of its most iconic products: the geometric dome tent. It’s used on expeditions. It costs about $6,000\. You’ll see it in National Geographic photos of Everest expeditions. It represents the pinnacle of outdoor sport: elite athletes doing, in my personal opinion, insane things that feel out of reach. That’s who The North Face was, historically. The brand began in 1968, founded by a group of dirtbag rock climbers and mountaineers with origins in Yosemite. It was rooted in mountaineering and extreme performance. When I became CFO in 2005, The North Face was a premier niche brand: iconic, respected, and not for everyone. And yet during my roughly eleven years there, we drove 5x organic growth. That didn’t happen by staying niche. It happened because we opened up access to the outdoors for everyone. We took The North Face from the summit down the mountain, into the city, into your mudroom, and ultimately into your closet. Because just because you’re not someone who will ever climb Everest doesn’t mean you don’t want the best-in-class jacket in a New York City winter. That was the shift: making the outdoors locally relevant. We started talking about “your personal Everest,” because everybody has an Everest. Mine isn’t better than yours. That framing invited more people into the outdoor movement, with the deeper hope of welcoming the next generation of [environmental stewards](https://www.financealliance.io/7-benefits-of-esg-investing/). I’ll be a little political for a moment: I feel like the outdoor environment is under assault, and that made this work feel even more important. That growth required CFO discipline underneath it. I learned quickly that innovation without economics doesn’t scale. I remember one of my first experiences as a novice CFO at The North Face. I was young and naive, and I bought into a $3,000 MSRP jacket that would automatically heat up using battery power. We spent a lot of money chasing that product. It made no margin. And nobody wanted to buy a $3,000 jacket twenty years ago. Maybe today the super billionaires might, but it wasn’t accessible. It wasn’t locally relevant to real consumers. That lesson stayed with me: you have to understand the [right price point](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/), the right margin, and the right value equation for both the customer and the business. ### **Mars Veterinary Health, Gulliver, and the universality of love** The third story is about Mars Veterinary Health and about Gulliver, my pandemic pup. I welcomed him home in November 2020, at the height of the pandemic. I’ve always loved dogs, and like many people, I needed more joy and companionship at that moment. He’s a doodle, and I think of him as my son. At Mars Veterinary Health, we operated the world’s largest veterinary company: around 3,000 animal hospitals around the world, 70,000 associates, serving 30 million pets a year. And when you step into that world, you realize quickly that the center of it isn’t numbers. It’s love. [Top 20 FP&A skills (10 hard skills & 10 soft skills)Here are the top 20 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-321.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--2--4.png)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) Dogs are pure love and joy. Veterinarians join the profession because they love animals. They’re not in it to make a buck. They go to medical school like human doctors, [incur just as much debt](https://www.financealliance.io/does-job-hopping-increase-your-salary-in-finance/), and yet the motivation is different. It’s about love, service, and passion. If you’re a pet owner, you know what I mean; you love that animal like your child. In the last thirty years, the human-animal bond shifted. Pets moved from farms, to backyards, into our houses, and ultimately into our beds. That emotional connection is universal. Love is universal. Yes, the consumer journey in healthcare varies across cultures. There are nuances. But the deeper driver is consistent. When you understand the unique value creation driver (love) you can build plans that are locally relevant and scalable. For me, that was one of the most powerful lessons of my career: you can be as analytical as you want, but you have to understand what truly matters to people. ## **The playbook I use for scaling across markets and cultures** After those stories, I’m often asked: what’s the [framework](https://www.financealliance.io/driver-based-planning-forecasting/)? What’s the [playbook](https://www.financealliance.io/storytelling-with-data-visualization/)? At the center is value creation. Around it, I think about six pillars of growth: 1. Having a powerful brand, 2. Understanding the consumer journey, 3. Running a strong product development cycle, 4. Going to market appropriately for the conditions, 5. Getting structural economics right, and 6. Investing in the infrastructure needed for sustainable profitable growth. I also believe in a balanced scorecard because businesses operate within macro trends. In the consumer brands I’ve worked for, trends like premiumization, personalization, sustainability, and health and well-being have mattered deeply. I’m not going to [talk about AI](https://www.financealliance.io/ai-in-fp-a/), because there’s already so much buzz about it, but it’s relevant too. Just as important is remembering [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/). Consumers are obvious, but associates matter too, especially in retail, where employees are your brand ambassadors. Shareholders matter, of course. Retail partners matter as well. For example, REI was one of The North Face’s biggest partners, and cultivating that partnership was important. And industry matters. In the outdoor industry or the veterinary industry, the businesses I worked for were leaders. What we did set the tone. I never forgot the responsibility, not just to the business, but to the broader purpose and cause connected to it. When I describe brand power, I focus on purpose rooted in excellence, best-in-class product and service, and [compelling storytelling](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/). For the consumer journey, it comes down to having the right value proposition, engaging the consumer in the right place and time, opening access, and building a consumer for life. But I always come back to the part many people underestimate: structural economics. Unit economics are critical, especially in retail. The “unit” might be a product, or it might be a store you own or lease, but it has to make money. You need operating efficiency for fixed costs. You need a clear reinvestment cadence and an understanding of the relationship between investment and revenue growth, a value creation algorithm. And then there’s infrastructure investment. People think of physical capital first: plants, equipment, distribution networks. Those matter, but human capital matters just as much. Retail associates, marketing talent, and emerging capabilities all drive success. You can’t always measure ROI on human capital investment, which is where faith has to come in. I know that’s strange from a CFO, but I believe it’s true. Ultimately, growth comes down to integrated business planning and disciplined execution. It’s a holistic plan, and it only works if it’s executed with rigor. That’s how you win. ## **The balance I still strive for: purpose and profit** I want to end with one idea that continues to guide me. Grant Reid, the former CEO of Mars, said something that resonated deeply with me: purpose without profit is impossible, but profit without purpose is not meaningful. That’s a call to lead with both heart and mind. [How CFOs are powering business strategyThis blog explores how today’s CFOs are stepping beyond traditional finance roles to become strategic partners - driving growth, shaping business decisions, and turning financial insight into organizational impact.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-322.png)Finance AllianceNick Rumball![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--52--3.png)](https://www.financealliance.io/how-cfos-power-business-strategy/) I’ve gone through walls for leaders who struck that balance, who cared about results and understood why the work mattered. I believe purpose and profit are mutually reinforcing, even though I don’t claim to have struck that balance perfectly every time. It’s an aspiration. Large organizations can become bureaucratic, and the CFO office can become a grind. And it is a grind. That’s why passion and purpose matter so much. For me, working at Mars Veterinary Health meant working for a business that saves pets’ lives. That mattered. And because it isn’t a nonprofit, the business has to be viable so it can serve more pets. I’ve also learned to accept tradeoffs when you choose purpose. Did I win every time? No. Did I get looked at like I was an alien? Yes. Did I not advance because I didn’t play certain games? Sure. And that’s okay. There are more important things in my life than [climbing a ladder](https://www.financealliance.io/fp-a-salary-and-career-path-guide/). That’s why I volunteer time with nonprofits and stay connected to causes I care about, especially the outdoors and environmental education for kids through NatureBridge. And one final truth about the CFO role: the partnership with the CEO is everything. I’ve always believed the [CFO and CEO have to be joined at the hip](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/). You need chemistry, complementary strengths, and alignment on purpose and values. That’s often why, when a new CEO comes in, they bring in their own CFO. It’s about alignment. One leader I learned from put it this way: there are two people a new CEO needs at their side (the CFO and the [Chief People Officer](https://www.peoplealliance.com/articles/what-does-a-chief-people-officer-do/)) because there’s nothing more valuable than money and people in an organization. Everything else you’ll get. I agree completely. And I would never work for a CEO I’m not truly simpatico with. I always ask about the purpose side first. The “why” beneath the numbers. Because driving global growth across markets and cultures isn’t just about expansion. It’s about building something meaningful and durable, something that can last quarter after quarter, year after year, generation after generation. That’s how I’ve understood the assignment. --- [**Join your finance peers**](https://www.financealliance.io/finance-alliance-salary-survey/) **in giving us your insight into current finance salaries in a global survey that'll show how much you should be making and how you can leverage the next pay rise discussion.** [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-316.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-12.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### Does job-hopping increase your salary in finance? URL: https://www.financealliance.io/does-job-hopping-increase-your-salary-in-finance/ Last updated: 2026-01-12T08:51:22.000Z Job-hopping has become one of the most debated [career strategies](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) in finance. For decades, the traditional advice was clear: stay loyal, grow within one organization, and your [salary will rise](https://www.financealliance.io/how-much-should-you-be-earning/) steadily over time. Today, however, where demand for skilled professionals remains high, roles evolve rapidly, and salary transparency is increasing, many finance professionals are rethinking that approach. Is staying put actually limiting earning potential? Or does moving between companies unlock higher pay and faster progression? ## **What the data shows: Salary vs number of companies worked at** One of the most striking findings in our [Finance Salary Report](https://www.financealliance.io/finance-salary-report/) is the relationship between salary and career mobility. When respondents were grouped by the number of companies they had worked for, average salaries increased dramatically with each category: - Professionals who have worked at **1–2 companies** reported an average salary of **$79,615** - Those who have worked at **3–5 companies** earned an average of **$112,939** - Professionals who have worked at **6 or more companies** reported an average salary of **$206,241** The difference between early-career stability and [broad career exposure](https://www.financealliance.io/top-10-cfo-skills/) is significant. Finance professionals with experience at six or more companies earn, on average, **more than $126,000 per year more** than those who have spent their careers at only one or two organizations. This isn’t a small incremental gain, but a structural shift in earning power. The data suggests that varied experience across organizations is one of the strongest indicators of higher long-term compensation in finance. [How finance certifications can boost your earning power in 2026Organizations increasingly expect finance teams to be proactive partners in shaping strategy, not just reactive record-keepers.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-311.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--4--2.png)](https://www.financealliance.io/finance-certifications-can-boost-your-earning-power/) ## **Why job-hopping is linked to higher salaries** The link between job-hopping and higher pay doesn’t exist in isolation. Several related findings from the survey help explain *why* professionals who move roles tend to earn more over time. ### **Broader experience builds stronger skill sets** Each organization operates differently. New roles expose finance professionals to different financial models, systems, industries, reporting standards, [leadership](https://www.financealliance.io/financial-leadership-in-changing-times-2/) expectations, and business challenges. Over time, this creates a broader and more adaptable skill set. The report highlights how closely [skills](https://www.financealliance.io/top-10-fp-a-skills-to-master/) are tied to compensation. Respondents who said they were **still developing relevant skills** earned an average salary of **$40,081**. Those with **several relevant skills** earned **$110,188**, while professionals who reported having **mastered relevant skills** earned an average of **$147,549**. Job-hopping accelerates this skill accumulation. Rather than mastering one organization’s way of working, professionals gain exposure to multiple [finance](https://www.financealliance.io/17-finance-business-processes/) environments, increasing their strategic value and versatility. ### **Market-driven salary resets** Another key factor is how salaries are adjusted over time. Internal salary increases are often constrained by [budgets](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), pay bands, and formal promotion cycles. Even when responsibilities increase, compensation does not always keep pace. The survey’s findings on pay progression support this. Many respondents reported taking on more responsibility without receiving a significant pay rise, while others said promotions came with only modest salary increases. Changing employers allows professionals to reset their compensation based on current market demand, not historical salary decisions. This is particularly important in finance, where skills can rapidly increase in value as professionals gain experience, manage larger teams, or move into more complex environments. [How to predict revenue in FP&A using machine learningBy analyzing historical sales data, marketing efforts, economic indicators, and even customer sentiment, machine-learning models can identify patterns and trends that are difficult for humans to see.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-312.png)Finance AllianceGabriela Gutierrez![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--8--1.png)](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/) ### **Access to higher-paying organizations** Compensation in finance varies significantly depending on company characteristics. The survey shows clear salary differences based on company [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/), size, and structure. For example, professionals working in companies with a **dedicated finance team** earn an average salary of **$124,558**, compared to **$84,524** for those working in organizations without one. Similarly, salaries increase in higher-revenue organizations and larger companies. Job-hopping increases the likelihood of moving into these higher-paying environments, [opportunities](https://www.financealliance.io/fp-a-exit-opportunities/) that may not be available through internal progression alone. ## **Does staying loyal to one company ever pay off?** Loyalty is not inherently a disadvantage, but the data suggests it only pays off when combined with clear progression. The [survey](https://www.financealliance.io/finance-alliance-salary-survey/) examined average salary by time spent at a current company and found that **longer tenure does not automatically result in higher pay**. In fact, the findings suggest that without promotions, expanded scope, or new responsibilities, salaries can plateau over time. This aligns with broader satisfaction data in the report. When asked about salary satisfaction, **40% of respondents said they were not very happy with their salary**, and nearly half felt their pay did not reflect the value they bring to their organization. In contrast, professionals who move between companies are more likely to experience salary increases that reflect their growing experience and market value. ## **Job-hopping, leadership, and responsibility** Another important link between job-hopping and higher pay is leadership progression. The survey shows a strong relationship between **the number of people managed and salary levels**. Professionals who manage teams earn significantly more than those without management responsibility, with salaries increasing as [team size](https://www.financealliance.io/fp-a-team-structure/) grows. Moving between organizations can accelerate access to leadership roles, particularly when internal promotion pathways are limited or slow. A role change may offer immediate responsibility for a larger team or a broader function, both of which are associated with higher compensation. This creates a compounding effect over time: - New role brings increased responsibility - Increased responsibility leads to higher pay - Higher pay strengthens negotiating power for the next move ## **The risks of job-hopping too early or too often** While the long-term financial benefits of job-hopping are clear, the strategy carries risks, especially early in a [career](https://www.financealliance.io/fast-tracking-your-fp-a-career/). Entry-level and early-career professionals often benefit from staying long enough to: - Build strong technical foundations - Develop confidence and credibility - See projects through full cycles The report shows that entry-level salaries vary widely, with many professionals starting their careers in lower salary brackets before progressing upward with experience. Frequent moves without sufficient depth of experience may limit learning and reduce long-term value. The highest earners in the survey are not those who moved constantly, but those who combined **depth of experience with breadth of exposure**. [How accountants can seamlessly transition into FP&AHere’s a very important question for you: Have you ever looked up from your numbers and wondered what it would be like to shape the financial future of a company, rather than just minding its past?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-313.png)Finance AllianceCarolina Lago![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--23--1.png)](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/) ## **Job-hopping and salary satisfaction** Salary satisfaction is a recurring theme throughout the report. While compensation is important, it is not the only factor influencing career decisions. The report found that: - **36.4%** of respondents prioritise salary in career decisions - **39.4%** place progression opportunities above salary - **24.2%** prioritise company culture over pay Job-hopping appears to support both financial and progression goals. By moving roles, professionals can pursue higher pay while also accessing new [growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) opportunities, something many respondents felt was lacking in their current positions. ## **The bigger picture: What the report really tells us** Taken together, the findings from the Finance Salary Report paint a clear picture. Finance professionals who work across multiple organizations: - Earn significantly higher salaries over time - Accumulate broader and more valuable skill sets - Gain access to higher-paying companies and roles - Improve their leverage when negotiating pay At the same time, the data suggests that loyalty without progression can limit earning potential, particularly in organizations where pay increases do not keep pace with responsibility. ## **Final thoughts: Should finance professionals job-hop?** The data does not suggest that finance professionals should move jobs impulsively or frequently without purpose. Instead, it highlights the value of **strategic mobility**. The most successful professionals appear to: - Build strong foundations early - Move roles to expand skills, responsibility, and exposure - Use market opportunities to reset compensation - Balance stability with [long-term growth](https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/) Ultimately, the question isn’t whether job-hopping increases salary, as it clearly does. The more important question is *how* and *when* to move in order to maximise long-term value. For finance professionals feeling underpaid, undervalued, or stagnant, a carefully chosen next role may be one of the most powerful levers available to increase earning potential and career satisfaction. [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-310.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-10.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### The governance gap in your fastest-growing expense [OnDemand] URL: https://www.financealliance.io/how-finance-leaders-govern-healthcare-spend/ Last updated: 2026-03-27T16:21:49.000Z Everyone is following the rules, so why does the spend keep climbing? Watch this free session to find out. If regulators or your board asked tomorrow: “*How do you know your healthcare spend is being actively governed?*” Would you have an answer? You missed the live session, but that doesn't mean you have to miss out on the insights. ### Meet the speakers **David Magnan** *, Technology Executive & Business Leader* David Magnan is a results-driven technology executive with over 50 years of leadership experience. He has led organizations through growth, transformation, and operational excellence across sales, marketing, customer service, software R&D, and large-scale operations, including turnarounds and strategic acquisitions. **Erik Kolstad** *, Actuary & Healthcare Economics Leader* Erik Kolstad is an experienced actuary and business leader with deep expertise in commercial health, Medicaid, and Medicare markets. He is an Associate of the Society of Actuaries and a Member of the American Academy of Actuaries. ### ### Spendageddon is coming for your finance team URL: https://www.financealliance.io/spendageddon-is-coming-for-your-finance-team/ Last updated: 2026-01-08T13:08:49.000Z Expense management has become one of the most underestimated pressure points in modern finance. While revenue growth remains uncertain and [budgets](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) are under scrutiny, finance leaders are being asked to do more with less: cut costs, protect margins, and maintain control without slowing the business down. At the same time, employees are navigating a very different reality. Rising costs of living, evolving work models, and unclear expense boundaries are reshaping how people experience [corporate spending](https://www.financealliance.io/financial-charts-and-graphs/) policies day to day. When those two realities collide, the result isn’t just frustration. **It’s** **spendageddon**. Spendageddon occurs when tension peaks between employees’ needs and finance department practices, causing [finance leaders](https://www.financealliance.io/financial-leadership-in-changing-times-2/) to lose control of spending and their ability to protect the bottom line. In [**The CFO’s guide to surviving spendageddon**](https://www.financealliance.io/the-cfos-guide-to-surviving-spendageddon/), Emburse examines new research from more than 2,000 finance professionals and employees to uncover what’s really driving expense fraud, rising tension around corporate cards, and declining visibility into spend. The findings reveal an uncomfortable truth for finance leaders still relying on legacy expense practices: when employee experience is ignored, cost control starts to break down. **You’ll need to** [**download the full (free) guide**](https://www.financealliance.io/the-cfos-guide-to-surviving-spendageddon/) **to see the complete research, data, and recommendations for averting it.** [The CFO’s guide to surviving spendageddonExpense fraud, user experience, and the bottom line![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-314.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Whitepaper_Meta_Emburse_1.png)](https://www.financealliance.io/the-cfos-guide-to-surviving-spendageddon/) ## **Why cost control feels harder than ever** Finance leaders everywhere are tightening their belts. In the wake of economic uncertainty and the push for return-to-office mandates, organizations are under pressure to increase profitability even when [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) growth slows. When growth can’t close the gap, expenses become the lever. But cost control measures don’t exist in a vacuum. The stricter policies become, the more they show up in employees’ daily workflows, especially when it comes to buying what they need to do their jobs. Most employee expectations are reasonable. They want clarity around what they can spend, confidence that purchases are allowed, and the ability to pay without risking their personal finances. When expense systems fail to deliver on those basics, friction builds quickly. ## **The growing disconnect around corporate cards** At the center of spendageddon is a simple but powerful disconnect: how employees want to pay for business expenses versus how organizations actually enable them to do so. The majority of employees would prefer to use corporate cards for business purchases, particularly as personal [cash flow](https://www.financealliance.io/cash-flow-drivers-in-a-business/) becomes more strained. Yet many employees still rely on personal debit or credit cards because they don’t have access to a company card at all. From a finance perspective, limiting card access can feel like a responsible control mechanism. Corporate cards are often issued only to senior executives or managers, sometimes with additional qualification requirements. In practice, this means a relatively small portion of employees are empowered to make purchases independently, even when those purchases are essential to their work. For employees without access, the choice becomes uncomfortable: front the cost personally and wait for reimbursement, or delay work while seeking approvals and alternative payment paths. Over time, that friction erodes trust in the system. [Get your free guide](https://www.financealliance.io/the-cfos-guide-to-surviving-spendageddon/) ## **Hybrid work has blurred expense boundaries** The shift from fully remote work to hybrid environments has added a new layer of complexity. Expenses that once felt clearly defined (commutes, meals, childcare, relocation) now fall into gray areas that policies weren’t designed to address. Employees report increased costs directly tied to return-to-office policies, while reimbursement rules vary widely across organizations. In some cases, legal requirements further complicate the picture, forcing [finance teams](https://www.financealliance.io/fp-a-team-structure/) to adapt legacy policies to a new reality. At the same time, hybrid work has accelerated decentralized purchasing. Employees increasingly manage vendor relationships themselves, especially for recurring software, subscriptions, and digital services. These purchases often surface only when expense reports are submitted, long after the transaction occurred. For finance teams, this creates delayed visibility, misclassified spend, and a growing reconciliation burden, exactly the opposite of what tighter controls are meant to achieve. ## **When expense friction hits personal finances** As policies become more restrictive and reimbursement timelines stretch, the impact on employees becomes financial, not just operational. A significant number of employees report incurring overdraft fees, interest charges, or late payment penalties because business expenses were charged to personal cards and reimbursements didn’t arrive in time. Others report needing to closely monitor their personal finances or delay purchases altogether while waiting to be reimbursed. This effectively turns employees into short-term lenders for their employers, an arrangement that becomes increasingly untenable as personal financial stress rises. Despite this, many finance leaders believe their expense experience is strong. A large portion rate their organization’s process highly, suggesting a growing gap between [leadership](https://www.financealliance.io/cfo-leadership-pillars/) perception and employee reality. ## **How stress turns into risky behavior** The most dangerous outcome of spendageddon isn’t dissatisfaction, it’s behavior change. When financial pressure builds, some employees begin to bend the rules. A notable percentage admit to passing off personal purchases as business expenses, while others say they’ve considered doing so. Historically, fraud rates have increased during periods of economic strain. What’s striking now is the magnitude of the jump compared to previous years, coinciding with higher living costs, delayed reimbursements, and hybrid work complexity. Taken together (out-of-pocket expenses, reimbursement delays, personal financial stress, and rising fraud) the message is clear. **Expense management is no longer just an operational process. It’s a user experience problem with direct financial consequences.** ## **Download the full guide to surviving spendageddon** The insights above only scratch the surface of what’s driving spendageddon, and what finance leaders can do to avoid it. In [**The CFO’s guide to surviving spendageddon**](https://www.financealliance.io/the-cfos-guide-to-surviving-spendageddon/), Emburse goes deeper into the research and also outlines practical strategies for restoring visibility, enforcing policy earlier in the spend lifecycle, and balancing control with employee autonomy. If expense management is quietly eroding trust, visibility, or your ability to protect the bottom line, this guide offers a clear-eyed look at what’s really happening and how you can change course. 👉[**Download the full (free) guide**](https://www.financealliance.io/the-cfos-guide-to-surviving-spendageddon/) to learn how to avert spendageddon before tension turns into lost control. [Get (free) tips on how to survive spendageddon](https://www.financealliance.io/the-cfos-guide-to-surviving-spendageddon/) ### Mastering data storytelling: A CFO's guide to turning numbers into action URL: https://www.financealliance.io/mastering-data-storytelling/ Last updated: 2026-01-07T10:51:28.000Z Have you ever felt like you're drowning in a [sea of data](https://www.financealliance.io/transforming-financial-data-into-compelling-stories/), desperately searching for that life-saving insight? I know I've been there more times than I care to admit! I'm **Sharon Mahoney**, **CFO** at **Le Prix**, and I've spent the last eight years navigating the choppy waters of [high-growth companies](https://www.financealliance.io/guide-to-company-growth/). In that time, I've learned a thing or two about transforming data into compelling stories that drive real change. In this era of [SaaS](https://www.financealliance.io/tag/saas-finance/) tools and instant [analytics](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/), we're blessed (or cursed?) with more data than we know what to do with. But here's the million-dollar question: how do we cut through the noise and extract actionable insights to propel our businesses forward? That's exactly what this article will explore. We'll dive into everything from the challenges of data overload to the evolving role of finance in [data storytelling](https://www.financealliance.io/storytelling-with-data-visualization-playbook/), as I share my hard-earned wisdom on the art of data visualization. Whether you're a seasoned CFO or just starting your finance journey, this guide will equip you with the tools you need to transform your data into powerful narratives that shape the future of your business. So, grab your favorite spreadsheet (come on, I know you have one), and let's dive in. It's time to turn those numbers into action! [Top 15 must-have Chief Financial Officer skillsThe modern CFO wears many hats and must master a variety of CFO skills. But what skills does the CFO of the future need to stay on top of their game? Keep reading as we uncover some of the most important Chief Financial Officer skills…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-306.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--2--3.png)](https://www.financealliance.io/top-10-cfo-skills/) ## **The challenge of data overload** Let's face it: technology has revolutionized how we collect and analyze data. We can get our hands on vast amounts of information at the click of a button. But more data doesn't always mean better decisions. In fact, I've seen firsthand how an abundance of data can lead to what I call "*analysis paralysis*." Picture this: you're using the latest BI tools to create stunning [visualizations and data representations](https://www.financealliance.io/financial-charts-and-graphs/). Sounds great, right? But here's the catch – if that data isn't coming from a single source of truth, you might end up making contradictory decisions based on conflicting information. I've been there, and trust me, it's not a fun place to be. So, how do we cut through the noise and extract the information that really matters? It all comes down to asking the right questions: **1\. What is the data telling us about our wins and failures?** **2\. How can we use this information to craft strategies for the future?** **3\. What actionable items can we derive in real-time?** 💡 ****Remember**, our goal isn't just to collect data, it's to use that data to continue our successes and learn from our missteps. ## **The role of finance in data storytelling** Now, let's talk about our role as finance professionals in this [data-driven](https://www.financealliance.io/why-finance-teams-struggle-to-act-on-their-data-and-how-to-fix-it/) world. We're not just number crunchers anymore (though Excel will always have a special place in my heart). Our job is to investigate, understand, and share the stories behind the numbers. But here's the challenge: we often speak a different language than our colleagues in [sales, marketing, or operations](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/). I've lost count of the times I've seen [finance teams](https://www.financealliance.io/why-finance-teams-struggle-to-act-on-their-data-and-how-to-fix-it/) use jargon that leaves other departments scratching their heads. I've learned this lesson the hard way. Early in my career, I'd use terms like "EBITDA" and "working capital" in meetings with our sales and marketing teams, only to be met with blank stares. So, how do we bridge this communication gap? The key is to tailor your message to your audience and make a conscious effort to speak their language. When I'm talking to our sales team, I focus on [top-line revenue](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) and growth projections. For operations, it's all about efficiency metrics and supply chain KPIs. The goal is to translate our financial insights into language that resonates with each department. [EBITDA calculator & guide to what it really tells youIn this simple guide, we’ll break it all down: what EBITDA is (and isn’t), how it compares to EBITA, when to use it, and we’ll also include a free EBITDA calculator you can use right away.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-307.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/EBITDA-calculator-2.png)](https://www.financealliance.io/ebitda-calculator-guide/) ## **The art of data storytelling** Now, let's dive into the nitty-gritty of data storytelling. One tool I've found incredibly useful is **BI software**. It allows us to create visually appealing dashboards that different departments can easily understand and act upon. For sales teams, I create simple dashboards tracking gross [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) against projections, broken down by customer, channel, or region. This gives them a clear, real-time picture of their [performance](https://www.financealliance.io/32-cfo-kpis/) without overwhelming them with financial details they may not need. For operations teams, I focus on [metrics](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) like order fulfillment rates, supply chain efficiency, and quality control. The key is to identify the KPIs that truly matter for each department and present them in a clear, visually appealing way. ### **The power of data visualization** Now, let's talk about the power of visualization. In my experience, everyone appreciates a well-designed [chart or graph](https://www.financealliance.io/financial-charts-and-graphs/); after all, we're in retail for a reason! But it's not just about making things look pretty. The goal is to make complex data instantly understandable and actionable. However, a word of caution: don't let the pursuit of pretty graphics overshadow the substance of your [data](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/). A beautiful dashboard that no one understands is just digital art. Make sure your visualizations clearly communicate the key points and help drive decision-making. [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-308.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--11.png)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) ### **Use examples** Lastly, don't underestimate the power of real-world examples in your data storytelling. Whenever I present data, I try to include anecdotes or [case studies](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) that bring the numbers to life. It could be a success story from another company in our industry, or a cautionary tale of what happens when data is ignored. These stories make the data relatable and memorable, increasing the likelihood that it will actually influence decision-making. ## **Ethical implications in data analysis** Now, let's talk about something that doesn't get enough attention in our field: the ethical implications of data analysis. As finance professionals, we have a responsibility to ensure that our data analysis is not only accurate but also comprehensive and unbiased. I've seen situations where different departments request analyses that support their specific agendas. While this is understandable, it can lead to a siloed perspective that doesn't serve the company's overall interests. Let me share a story that illustrates this point. In a previous role, we were heavily invested in a new distribution strategy. The CRO had conducted an analysis showing great revenue and margins, justifying further investment and operations used company-wide averages to show how much we were shipping, painting a rosy picture of [growth](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/). But something didn't add up. So, I dug deeper, conducting an order-level economic analysis. Lo and behold, we discovered that this channel was actually highly unprofitable when we accounted for product costs and inbound shipping specific to this strategy. This experience taught me the importance of looking at the whole picture. As finance professionals, we need to be the voice of reason, ensuring that our analyses tell the complete story, not just the parts that certain stakeholders want to hear. [Top 20 FP&A skills (10 hard skills & 10 soft skills)Here are the top 20 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-309.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--2--3.png)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) ## **Conclusion** As we wrap up, I want to leave you with a key takeaway: **Don't let data overwhelm you**, try to **remember that your role goes beyond number-crunching**. You're a storyteller, translating complex financial data into narratives that inspire action and drive change. As we look to the future, the ability to effectively analyze and [communicate](https://www.financealliance.io/cfos-role-in-investor-communications/) financial data will only become more crucial. By mastering the art of data storytelling, we can position ourselves as key strategic partners in our organizations. So, the next time you're faced with a spreadsheet full of numbers, ask yourself: what's the story here? How can I communicate this in a way that inspires action? That's where the real magic happens. --- This article comes from **Sharon Mahoney**’s brilliant talk, ‘*How to transform financial data into compelling stories that inspire action and change*’, at our **Boston FP&A Summit**. ### Fast-tracking your FP&A career: Insider tips, success stories, and networking strategies URL: https://www.financealliance.io/fast-tracking-your-fp-a-career/ Last updated: 2025-12-23T08:00:01.000Z *This article is based on a brilliant talk by Jon Yuregir, Group FP&A Director at International Workplace Group at our* [*FP&A Summit*](https://www.financealliance.io/events/)*. Jon was the Head of FP&A at easyJet at the time of this session.* --- My name is Jon Yuregir, and I’m the Head of Financial Planning & Analysis at easyJet. easyJet is the second largest airline in Europe, behind Ryanair, and a member of the FTSE 100, which is the UK’s leading stock exchange index. I’ve been in this role for about two and a half years, but my [journey in FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) and adjacent finance roles goes back much further. In total, I’ve spent around thirteen and a half years working across FP&A, commercial finance, and operational finance within the travel and aviation sector. Before moving into travel, I spent five years in FMCG with L’Oréal, which gave me a very different but equally valuable foundation. What I want to share here is not a single “right way” to build a career in FP&A, but rather an honest account of what I’ve seen work, what has worked for me personally, and what I would do differently if I were starting again. I’ve had successes, but I’ve also made mistakes and taken detours. FP&A is not always a clearly signposted [career path](https://www.financealliance.io/what-does-a-finance-director-do/), and for many people, myself included, it’s something you only really understand once you’re already in the world of work. [Top 20 FP&A skills (10 hard skills & 10 soft skills)Here are the top 20 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-303.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--2--2.png)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) ## **Thinking about your destination before you board** Because I work in aviation, I couldn’t resist using a flight analogy when talking about FP&A careers. Before you board a flight, you need to know your destination. The same is true when you’re thinking about moving into FP&A or progressing within it. One of the first things I always encourage people to think about is industry. FP&A is an outward-looking, strategic function. It’s not enough to be good at internal [reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) or cost control. You need to understand what’s happening outside the company as well, including market dynamics, competitive behavior, and broader economic [trends](https://www.financealliance.io/key-trends-shaping-the-future-of-finance/). If you have no interest in the industry you’re working in, that outward-looking element becomes much harder. Alongside industry, it’s important to think about what kind of FP&A function you want to be part of. Some people thrive in divisional [FP&A roles](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/), where they focus deeply on a specific part of the business. Others prefer group-level FP&A roles in multinational organizations, where the scope is broader and the complexity higher. There isn’t a right or wrong answer, but these choices shape your experience very differently. Seniority is another factor that deserves honest reflection. Higher seniority usually comes with higher pay, but it also comes with higher stress and a different type of pressure. As you move up, you typically spend less time building models in Excel and more time dealing with the consequences of [forecasts](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), whether you beat them or miss them. You also start to feel the weight of investor reactions and market expectations. That mental toll is real, and it’s something people don’t always factor in early enough. [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-304.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--10.png)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) ## **Understanding your skills, personality, and strengths** Alongside thinking about where you want to go, you also need to understand what you bring to the table. People often ask whether FP&A suits introverts or extroverts better, and my honest answer is that both can succeed. I’ve worked with highly effective FP&A professionals across the full spectrum of [personality types](https://www.financealliance.io/10-cfo-personality-traits/). What really matters is building a complementary team around you, especially if you lean strongly in one direction. Another common misconception is that finance, and FP&A in particular, is purely technical. Many people outside finance still see finance professionals as bookkeepers or cost [controllers](https://www.financealliance.io/cfo-vs-controller/). While technical skills are important, the real trend in FP&A is toward storytelling. The ability to translate complex analysis into a clear, compelling narrative is increasingly what separates good FP&A professionals from great ones. Passion also plays a role, whether that’s passion for a specific industry or curiosity about macroeconomic trends. Sometimes it’s not the industry itself that excites you, but the strategic lens you can apply to external developments and how they impact a business. That curiosity can be just as powerful in shaping a successful FP&A [career](https://www.financealliance.io/how-to-become-a-fractional-cfo/). ## **Finding your way into FP&A** One of the realities of FP&A, particularly in the UK, is that it’s rarely presented as a clear career path early on. When you’re a school leaver or university student, FP&A isn’t usually something that’s advertised or explained in detail. Many people only discover it once they’ve already started working. Some are fortunate enough to join FP&A straight away through graduate rotations or entry-level analyst roles. But in my experience, most people begin their careers in controlling roles or business partnering roles and then move into FP&A later. I’ve always believed that moving into FP&A is easier when there’s minimal separation between your current role and FP&A. Investor relations is a good example, particularly in listed companies. There’s a strong overlap between understanding future business performance, investor expectations, and [financial forecasting](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/). Moving from investor relations into FP&A can be very seamless. Business finance roles, including commercial finance, operational finance, and business partnering, also provide strong foundations. These roles usually involve ownership of specific parts of the P&L rather than the full picture, but they build critical commercial understanding. Showing curiosity beyond your immediate remit is often what enables that move into FP&A. Corporate development, including [M&A](https://www.financealliance.io/risks-of-mergers-and-acquisitions/), also aligns closely with FP&A in many organizations. Financial control and reporting might seem less obvious because it’s backward-looking, but in practice there’s significant interaction between financial control and FP&A during month-end processes and forecast updates. That [collaboration](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) often opens doors. There are other paths, such as treasury or strategy, particularly in larger organizations, but these tend to be slightly more difficult transitions. Strategy roles, for example, often attract people from consultancy backgrounds. While more consultants are moving toward CFO career paths via FP&A, it’s still less common than the other routes I’ve mentioned. For roles further away from FP&A, such as audit, transactional services, or non-finance operational roles, the journey usually involves one intermediate step. In those cases, moving into a business partnering or financial control role first tends to make the transition more realistic. ## **Progressing through the ranks without stagnating** Once you’re in FP&A, the question becomes how to progress. One idea I often talk about is what I call the “Goldilocks tenure,” typically around two to three years in a role. If you move too quickly, it can be hard to demonstrate that you’ve experienced enough planning cycles to add real value. If you stay too long, there’s a risk that your development plateaus. That doesn’t mean every move has to be a promotion. I’ve moved sideways multiple times in my career, often to broaden my experience rather than chase a title. Role enlargements, secondments, and project work can be just as valuable as formal promotions. In fact, the most effective FP&A professionals I’ve worked with are rarely people who have spent their entire careers in FP&A. They’ve usually spent time in business partnering or financial control, which gives them a more rounded perspective when they return to FP&A roles. ## **How FP&A looks from the outside** From a stakeholder’s perspective, great FP&A can look deceptively calm. I often use the analogy of a swan gliding across water. Above the surface, everything looks smooth and serene. Stakeholders see polished presentations, well-run budget processes, clear explanations of variances, and no surprises. What they don’t see is the frantic activity beneath the surface. FP&A teams are constantly in dialogue with the business, planning timelines, building buffers into forecasting cycles, preparing CFO and CEO [presentations](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/), and tracking forecast accuracy across business units. All of that work is invisible when it’s done well. That ability to present consistency and calm, even when things are turbulent behind the scenes, is a defining skill in FP&A. ## **Knowing when and how to move** Career progression also involves knowing when to move and how to do it intelligently. Internal progression is often one of the strongest signals on a résumé. When I see evidence of internal promotions, it gives me confidence that someone is valued within their organization. By contrast, seeing repeated lateral moves into the same role across different companies can raise questions. It may suggest that someone has reached a ceiling and is unable to progress internally. That doesn’t mean lateral moves are always wrong, but they should be made thoughtfully and for clear developmental reasons. When considering moves, I also think in terms of “soft landings.” These include the level you’re operating at, the discipline you’re in, the company, and the country. The more of these that change at once, the harder the [transition](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/) becomes. Recruiters and hiring managers are often looking at how likely a move is to set someone up for success. Job titles, in my view, are far less important than people think. Titles vary widely across companies and geographies. What matters more is how many layers you are from the [CFO](https://www.financealliance.io/top-10-cfo-skills/) and the scale and complexity of the organization you’re operating in. ## **Operating at senior levels** As you move into more senior FP&A roles, the skill set changes significantly. At this level, you’re judged on outcomes rather than outputs. You need to distinguish between noise and signal, both internally and externally. People will constantly bring you opinions, concerns, and ideas, but not all of them will materially impact the business. Communication becomes even more critical. When you’re presenting to board members and non-executive directors, anticipating what they need and engaging them ahead of time can make a huge difference. One of the golden rules is never to surprise your CFO in a meeting. Difficult messages should be shared early and handled with care. Over time, you also need to shape a consistent narrative. As the guardian of the forecast, credibility is everything. Wild swings in forecasts undermine trust, even if they’re technically accurate. [Managing risk](https://www.financealliance.io/fx-101-course/) and opportunity offline allows you to present a calm, consistent picture, even in volatile environments. Building and retaining a strong team is essential at this stage. No senior FP&A leader can operate effectively without a trusted number two. Delegation isn’t optional; it’s a necessity. [How finance certifications can boost your earning power in 2026Organizations increasingly expect finance teams to be proactive partners in shaping strategy, not just reactive record-keepers.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-305.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--4--1.png)](https://www.financealliance.io/finance-certifications-can-boost-your-earning-power/) ## **Making your own luck** Fast-tracking a career always involves a mix of skill and luck, but there are ways to influence the odds. Being clear about your intended destination and communicating that ambition to senior leaders matters. So does thinking two roles ahead rather than one. Finding a champion is also critical. A champion is different from a mentor or coach. This is someone who advocates for you even when you’re not in the room. I’ve personally benefited enormously from having a champion who believed in me, even after they left the company we worked at together. That relationship eventually led to a much broader role and an international move. At the same time, ambition must be backed by delivery. No amount of [networking](https://www.financealliance.io/11-networking-in-finance-tips/) or career planning can compensate for failing to deliver on the fundamentals. Expanding your network, particularly with your manager’s manager, also plays a key role, as those individuals are often the ultimate decision-makers when it comes to promotions. ## **Looking back on my own career** When I reflect on my own career, I’m honest with myself about what I would change. I didn’t even start in finance. I began in [sales](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/), and I didn’t know what FP&A was for years. In that sense, I lost time early on. Personality assessments helped me understand where I could excel, but I still moved into FP&A relatively late, around seven or eight years into my career. Once I did, however, I gained a much sharper focus. The exposure to the CFO confirmed that this was the path I wanted to pursue. Today, operating at the C-suite level is still a learning process. It’s something I continue to develop every day. Overall, though, I’m comfortable with where I’ve reached so far, and much of that comes back to having the right champion at the right time. FP&A is not a linear journey, and it’s not always obvious from the outside. But with reflection, curiosity, strong delivery, and the right relationships, it can be an incredibly rewarding career path. --- [Take our Salary Survey](https://www.financealliance.io/finance-alliance-salary-survey/) and give us your insights on what's really happening in finance. See where you stand compared to peers in similar roles, industries, and regions. [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-301.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-9.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### The CFO’s guide to surviving spendageddon URL: https://www.financealliance.io/the-cfos-guide-to-surviving-spendageddon/ Last updated: 2026-02-19T16:15:17.000Z **Finance leaders are being pushed to tighten policies, restrict cards, and delay reimbursements.** But those moves are triggering an unintended chain reaction: - Employees are paying out of pocket more often - Reimbursements are taking longer - Out-of-policy spend is rising - Fraud risk is accelerating - Visibility into spend is quietly slipping **Spendageddon** is what happens when the needs of finance and employees collide and control starts to slip. This guide helps CFOs spot the warning signs early and take back control **before it hits margins, compliance, and growth.** [Get your guide](https://share-eu1.hsforms.com/1qclk89m4SXSSF64CL5voWg2b1vun) ## A quick preview ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2026/02/Screenshot-2026-02-19-at-14.46.16.png) ## What you'll learn Inside the guide, you’ll discover: - Why expense fraud is rising and why stricter policies often backfire - How poor expense experiences erode trust, compliance, and margins - Where finance teams lose visibility in hybrid and decentralized environments - Practical strategies to regain control without slowing teams down Backed by insights from ****2,000+ finance leaders.** If you’re responsible for protecting margins, enabling growth, and managing risk, this is required reading. **Download the guide and take control before Spendageddon hits.** [Get your guide](https://share-eu1.hsforms.com/1qclk89m4SXSSF64CL5voWg2b1vun) ### Why finance teams struggle to act on their data (and how to fix it) URL: https://www.financealliance.io/why-finance-teams-struggle-to-act-on-their-data-and-how-to-fix-it/ Last updated: 2025-12-19T13:38:43.000Z Today’s CFOs and finance teams are expected to do far more than close the books. They’re being asked to shape strategy, guide growth, and deliver better outcomes — all while operating with disconnected systems, manual processes, and limited visibility into spend. This free eBook explores how finance teams can move from reactive processing to proactive leadership by unifying data and automating spend management. --- ### Why this matters right now Automation is no longer a future aspiration. It’s available today — and it’s fundamentally changing what finance teams can achieve when data flows across the organization. - Disconnected systems make it harder to see spend clearly and act with confidence - Manual workflows delay reporting, approvals, and insight - Limited visibility keeps finance stuck in hindsight instead of leading forward If your team is still relying on spreadsheets, manual checks, or disconnected tools to manage spend, you’re losing time — and limiting the role finance can play in driving the business forward. --- ### What you’ll learn in this eBook - How automation frees finance teams from manual work so they can focus on higher-value, strategic activities - Why unified, cloud-based platforms improve spend visibility, control, and decision-making - How integrated data enables continuous monitoring of spend — not end-of-month surprises - Where technologies like virtual cards and AI reduce risk, enforce policy automatically, and strengthen compliance This eBook shows what changes when finance operates with connected data, automated workflows, and real-time visibility: faster decisions, fewer bottlenecks, stronger control, and more capacity to lead. [Download the eBook](https://share-eu1.hsforms.com/14jmCUf6cS6eU6T9tpdQTVQ2b1vun) ### Transforming financial data into compelling stories that inspire action and change URL: https://www.financealliance.io/transforming-financial-data-into-compelling-stories/ Last updated: 2025-12-16T10:27:35.000Z For most of my career, I’ve been surrounded by data. Sometimes I’ve been the one consuming it, sometimes the one producing it, and often the one standing in the middle, trying to turn large amounts of information into something that actually helps people make better decisions. Over time, I’ve become convinced that [data](https://www.financealliance.io/cost-benefit-analysis/) on its own is rarely enough. What really matters is the story you tell with it. That belief hasn’t come from a textbook or a single role. It has been shaped by a series of very different experiences, each of which forced me to think carefully about how information is interpreted, how decisions are made, and how easily even smart people can misunderstand complex ideas if they are not presented in the right way. I want to share some of those experiences, along with a few concepts from research that have strongly influenced how I think about [data storytelling](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/) today. My aim is not to provide a rigid framework or a set of rules, but to explain how I’ve learned to combine data, narrative, and an understanding of human behaviour to [create stories that actually lead to action](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/). [Top 20 FP&A skills (10 hard skills & 10 soft skills)Here are the top 20 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-295.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--2--1.png)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) ## **Learning to be concise as an equity analyst** I started my career as an equity analyst in asset management. In that world, your job is to understand companies, industries, and markets, using only public information, and then persuade someone else to make a decision based on your analysis. Typically, that “someone else” is a [fund manager](https://www.financealliance.io/chief-investment-officer-vs-chief-financial-officer/). What I learned very quickly is that you may spend weeks analyzing a company, but you often get only a minute or less to explain why it’s a good or bad investment. There’s a simple rule of thumb in that environment: if you can’t explain a good [investment idea](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/) in under a minute, using very simple language, it’s probably not a very good investment idea. That idea stayed with me. It forces clarity. If you can’t explain something simply, either you don’t understand it well enough, or the idea itself isn’t strong. There’s nowhere to hide behind complexity. You have to distill your thinking down to the essence of what matters. That discipline of simplicity and conciseness has followed me throughout my career, even as the context around me has changed dramatically. ## **From public information to strategic complexity** After asset management, I moved into a group strategy role at Swiss Re. The shift was significant. Instead of working only with public information, I suddenly had access to a vast amount of internal data. The questions were bigger, the time horizons longer, and the stakes often much higher. Strategic work involves fundamental decisions that can shape a company’s direction over the medium to long term. It also involves extensive [stakeholder](https://www.financealliance.io/stakeholder-communication-plan/) engagement. You’re not just analyzing information; you’re building consensus across different parts of the organization, often over long periods of time. In that environment, storytelling becomes even more important. You’re dealing with complex issues, but you still need to guide people toward a shared understanding and a clear decision. The challenge is not a lack of data. It’s deciding what matters, what doesn’t, and how to bring people along with you. More recently, [I moved into FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/), where the nature of the data changed again. The information is much more granular, and the focus is often on nearer-term decisions. The goal is to work closely with business leaders and help them make better commercial decisions using that data. Looking back, these different roles have given me very different perspectives, but they’ve all reinforced the same core lesson: data only becomes powerful when it’s translated into a [story](https://www.financealliance.io/storytelling-with-data-visualization/) that people can understand and act on. ## **Why cognitive biases matter more than we think** Before you finalize a presentation or shape a narrative, there are two things I believe you need to think about very carefully. The first is cognitive bias. There are well over a hundred identified cognitive biases. I certainly don’t know all of them, and I struggle to distinguish between some of them myself. But it’s incredibly important to be aware that they exist, both in yourself and in the people you’re presenting to. As analysts and [finance professionals](https://www.financealliance.io/7-reasons-why-fp-a-professionals-miss-the-bus/), we like to think we are rational. But the reality is that the way we acquire information, evaluate it, and make decisions is heavily influenced by biases. Many of these biases fall into two broad categories that are particularly relevant for [data storytelling](https://www.financealliance.io/mastering-data-storytelling/): how we acquire information, and how we evaluate it and make choices. One example is the ostrich effect, where we tend to disregard negative information more readily than positive information. There’s even research suggesting that ignoring information can trigger a dopamine response, because it makes us feel clever for dismissing something. I recognize that feeling myself. Another extremely important bias is the framing effect. The way information is presented has a huge impact on how it’s received. A classic example is a cleaning product that “kills 95% of bacteria” versus one that “lets 5% survive.” They describe the same outcome, but one sells far better than the other. Then there are verification [biases](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), such as confirmation bias, where we favour information that confirms what we already believe. There’s also what’s known as the self-relating bias, where people remember information better if it feels personally relevant to them. One bias I find particularly interesting is the illusion of explanatory depth. It’s the tendency for people to believe they understand complex phenomena much more deeply than they actually do. This becomes very important when you’re presenting complex data. People may think they understand what they’re seeing, but their understanding is often far shallower than they realise. Finally, there are simplification biases. We simplify complex environments, see causality where there may only be correlation, and become overconfident in our judgments. Visual choices, such as how you scale a chart, can dramatically influence how volatile or significant something appears. All of this means that as users and presenters of information, we have to be extremely careful. We are not neutral conduits of truth. The way we select, analyze, and present data inevitably shapes the decisions that follow. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-296.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-10.png)](https://www.financealliance.io/financial-charts-and-graphs/) ## **FP&A at the centre of complexity** One day, when my son was home sick from school, he chose a small green alien character for one of my slides. That character ended up representing [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) in my mind. FP&A sits at the centre of a very complex world, surrounded by vast amounts of data, and our job is to translate that complexity into something executives can actually use. The most effective way people make decisions is through simple, relevant narratives. To do that, FP&A professionals have to understand the business deeply. We’re not just reporting results or explaining variances. We are taking on part of the decision-making burden. There’s a chemical called glutamate that builds up in the brain as we make decisions, and it contributes to mental fatigue. Executives make an enormous number of decisions every day. One of our responsibilities is to reduce that burden by doing the heavy lifting ourselves, filtering the noise, and presenting only what truly matters. ## **How people actually read information** Eye-tracking research shows something that shouldn’t surprise us, but often gets ignored. People don’t read information carefully from top to bottom. They skim. They focus on headings, the beginnings of sentences, and images. As they move down a page, their attention drops off quickly. This has big implications for how we [write slides](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/), reports, and narratives. If the key point is buried at the end of a long sentence, there’s a good chance it will be missed. Clear headings, short sentences, and upfront statements matter far more than we like to admit. Our concentration spans are short. We need to accept that and design our [communication](https://www.financealliance.io/cfos-role-in-investor-communications/) accordingly. [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-297.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--9.png)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) ## **Knowing your audience** The second thing you need to think about early is your audience. In most organizations, your audience will usually fall into one of three broad groups: experts, managers, or executives. With experts, you can go lighter on narrative and heavier on data. It’s often an exploratory conversation. With executives, you need to get straight to the point. Managers typically sit somewhere in between. In my experience, especially in large organizations with long decision processes, it often makes sense to start by creating material that would work for experts. That helps you understand the data yourself. You get feedback, refine your thinking, and identify what really matters. As you move toward managers, you slim things down. By the time you reach executives, only the most important information should remain. Every step is about removing noise, not adding content. Understanding your audience also means understanding their [pain points](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/), goals, and interests. This is where cognitive biases come back into play. If you know what someone cares about, you can frame information in a way that resonates with them. I’ve found it very helpful to use senior management engagement not just to understand their own views, but to understand the wider decision-making landscape. Senior [leaders](https://www.financealliance.io/operational-finance/) often know the preferences, concerns, and biases of other key stakeholders far better than you do. That insight can be invaluable. ## **Purpose comes before content** Before building any story, you also need to be clear on the purpose of your [presentation](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/). Are you trying to motivate, activate, persuade, or align? If the goal is motivation, the story will be more [emotional and personal](https://www.financealliance.io/top-10-cfo-skills/), and less data heavy. If the goal is activation or persuasion, you need a clear problem statement at the start, a solution at the end, and evidence along the way. Whatever the purpose, the message must be aligned with the needs of the audience. That alignment is what turns information into action. ## **Data, narrative, and delivery** For me, data storytelling rests on three components: data, narrative, and delivery. Data is the backbone, but it’s not just about having information. It’s about selecting the most important data and analyzing it in a way that’s relevant to the people you’re speaking to. Narrative is about structure. I was initially sceptical of [storytelling](https://www.financealliance.io/mastering-data-storytelling/) models that talk about characters, settings, conflicts, and resolutions. They sounded more like fiction than business. But over time, I realised how applicable they are. In my presentations, I often start with the “characters.” That might be a client group, a competitor, or a product line. I explain who they are, where they come from, and why they matter. Then I move to the setting, providing context. Why is this relevant? How material is it? From there, I explain the conflict or opportunity, making it personally relevant to the decision-maker. If they can see how it affects them, their [performance](https://www.financealliance.io/32-cfo-kpis/), or how they are perceived, it becomes much more powerful. Delivery is about simplicity, clarity, and logic. I spend a lot of time thinking about the order of slides, the flow of the argument, and the most logical way to take someone through the story. One thing I firmly believe is that when presenting to executives, you don’t get marks for showing your workings. This isn’t school. The only thing that matters is the outcome. Showing too much analysis often distracts rather than helps. ## **Visualization as a means, not an end** When it comes to visualization, the key question is simple: does it help understanding? Too often, visuals are used because they look impressive, not because they add clarity. A good visual does the work for the audience. It shows the insight directly. It doesn’t require them to calculate ratios or infer conclusions. It is explicit, intuitive, and honest. Never imply something and expect people to figure it out. Use the data yourself and show the result. [Data storytelling for FP&AWhat do Barack Obama, Oprah Winfrey, and Nikki Glaser have in common? They all excel in storytelling...and you can do (yes, even as a finance professional!). Here’s how…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-298.png)Finance AllianceMathew Reynders![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--37--3.png)](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/) ## **Medium matters, but culture matters more** A final point that often comes up is the medium of communication. In my experience, PowerPoint remains the [dominant tool](https://www.financealliance.io/15-best-fp-a-tools-and-software/), especially at senior levels. Many executives prefer something familiar, sometimes even a physical printout. That doesn’t mean digital tools have no place. Dashboards and BI platforms are extremely valuable for exploration and standardised reporting. But when it comes to storytelling and decision-making at the top, a small number of carefully crafted slides is still incredibly effective. Ultimately, you have to adapt to your organization’s culture. Over time, you can influence change, but you can’t ignore how people prefer to consume information today. ## **Why this all matters** Data storytelling is powerful. It shapes decisions. It influences outcomes. But it only works if you are aware of your own biases, understand your audience, and use data and visuals in a way that genuinely enhances understanding. If you get it right, you don’t just present information. You help people make better decisions. And in the end, that’s what finance, FP&A, and analytics should really be about. --- [**Participate in our Salary Survey**](https://www.financealliance.io/finance-alliance-salary-survey/) **to add your insights to a global report your peers are already taking part in. Don't let your voice be ignored.** [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-299.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-8.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### Business Travel Snapshot (Where to find savings in your travel budget) URL: https://www.financealliance.io/2025-business-travel-snapshot-where-to-find-savings-in-your-2025-travel-budget/ Last updated: 2026-01-27T11:47:52.000Z Corporate travel is entering a more stable (yet more strategically complex) chapter. Rates are leveling off, demand is rising, and new technologies like NDC and AI are opening fresh possibilities for savings and efficiency. At the same time, workforce expectations, sustainability priorities, and shifting supplier dynamics are reshaping how travel programs operate. The **Business Travel Snapshot** brings clarity to this moment. ## **This guide solves challenges like:** 1. **Limited visibility** into true costs and market variability 2. **Stalled negotiations** with airlines and hotels amid shifting distribution models 3. **Inefficient, fragmented workflows** without strong tech or AI integration 4. **Policies that no longer align** with hybrid or remote workforce dynamics 5. **Buyers unintentionally overpaying** due to uneven rate behavior across markets Built on global booking data and emerging trends, this whitepaper ****helps** ****travel and finance teams** to build a more predictable, cost-conscious, and traveler-friendly program. ## **Inside, you'll find:** - Stabilizing rates and new pricing opportunities - A clear picture of returning business travel demand - How NDC and AI are evolving from buzzwords to real savings levers - Geography matters more than ever - Forces reshaping program design [Download your whitepaper](https://share-eu1.hsforms.com/1oT27d2J7TmO4JG9Xte5SoQ2b1vun) ### Navigating your first 90 days as a CFO: What you need to know to succeed URL: https://www.financealliance.io/your-first-90-days-as-cfo/ Last updated: 2026-06-19T09:28:41.000Z Stepping into a new [CFO role](https://www.financealliance.io/top-10-cfo-skills/), whether it’s your first time in the seat or simply your first month in a new company, has always felt, to me, like drinking from a fire hose. No matter how seasoned you are, no matter how many C-suite roles you’ve held, the early days are overwhelming in the same familiar way. You think you understand the landscape from the interview process, and you walk in feeling cautiously confident. But then day one arrives, and suddenly the neatly packaged narrative you were told during [recruitment](https://www.financealliance.io/recruitment-in-finance-4-hiring-hacks/) gives way to the real business: its cracks, its silos, its miscommunications, and its pressures. I’ve worked in CFO and CEO roles across different markets and companies, including swipejobs and now World Energy. I’ve run a global consulting firm that took me through Europe and Asia, where I learned as much from my mistakes as from my successes. Across all those roles, one thing has remained constant: **your first ninety days set the tone for everything that follows**. They determine how people perceive you, how much trust you earn early, and how effectively you can start influencing the company’s direction. These days, I like to joke with audiences that I’m bilingual: I speak English and I speak Australian. The Australian version has lots of nuance, and if you don’t understand me I can dial it back. But humor aside, that feeling of being immersed in a flood of information (and having to make sense of it quickly) is universal for every CFO starting fresh. What I’ve learned over the years is that having a structured approach isn’t just helpful, but essential. Ninety days can go by in a whirlwind, and without a [clear framework](https://www.financealliance.io/driver-based-planning-forecasting/), it becomes easy to chase competing priorities without building a foundation. So here’s my blueprint (broken into three thirty-day stages) grounded in lived experience, the problems I’ve walked into, the mistakes I’ve made, the questions I now know to ask, and the lessons I’ve learned the hard way. [Why most mergers fail: Lessons from weather patterns and M&A due diligenceUnlike weather forecasting, where being wrong just means carrying an umbrella, being wrong about an acquisition can destroy both companies.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-286.png)Finance AllianceBill Guerrero![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images-Text.png)](https://www.financealliance.io/why-most-mergers-fail/) ## **The first 30 days: Understanding the business before trying to fix it** Whenever I join a new organization, the very first thing I do is try to understand the business. Not the theoretical business described in [board decks](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations) or interviews, but the real business shaped by real people operating under real pressures. Long before becoming a CFO, I ran a global consulting firm. I worked throughout Europe and Asia, learning through a mix of fantastic experiences and a fair [number of mistakes](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/). One of the most important lessons that period taught me was the value of the org chart; not the neat, polished version circulated during onboarding, but the version that actually reflects influence, friction, bottlenecks, and unstated hierarchies. If you don’t understand [who the key players are](https://www.financealliance.io/stakeholder-communication-plan/), you won’t understand why things happen the way they do. So during those first thirty days, I set up one-on-one meetings with [leaders](https://www.financealliance.io/operational-finance/) from every corner of the business. I don’t ask for presentations; I ask for candor. People are remarkably honest in a one-on-one setting, especially when they don’t feel exposed in front of their peers. They will tell you which processes are broken, who they can’t work with, what delays are hurting their [ability to hit targets](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/), and what they wish finance would stop doing. Early in one role, for example, I thought I had a firm grasp on the company’s systems and processes before I walked through the door. But once I arrived, I realized the organization had significant cash-flow management issues and that nearly every department was running on different systems. There was no unified financial platform like NetSuite. Data lived in silos. Business units had fundamentally different understandings of the company’s cash position. It was the kind of problem that can go unnoticed until you're in the room, asking the questions that reveal fragility beneath the surface. This is why I obsessively document everything in the first thirty days. When I start hearing similar concerns from multiple leaders (whether around reporting delays, system inefficiencies, or strategic misalignment) I bucket them together. Those buckets become the foundation for candid [conversations with the CEO](https://www.financealliance.io/how-to-gain-and-sustain-ceo-sponsorship/). And speaking of CEOs: one of the most important early conversations is about the company’s growth strategy. I always ask the CEO directly: *Where are we going? How do you intend to grow? How will we pay for that growth?* Because understanding strategy without understanding financing is like being given a destination with no idea how full the fuel tank is. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-288.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-9.png)](https://www.financealliance.io/financial-charts-and-graphs/) Are we relying on line-of-credit financing? Are we looking at capital raises? Are we preparing for an IPO? Are we leveraging private investments? The answer fundamentally shapes how a CFO must operate. During this period, I also review the financials; everything from [cash-management practices](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) to the balance sheet to the company’s lending facilities. Once, I stepped into an organization where the fixed charge coverage ratio (FCCR) reporting was being completed on the very day it was due. No [forecasting](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/). No forward visibility. I thought I’d produce a neat, tidy quick win by building a forecast and showing that we were safely within covenant. Instead, I discovered we were headed toward breaching a covenant within two months. Not exactly the kind of early victory you dream of sharing with your CEO. Still, it turned out to be valuable. It exposed weaknesses, sharpened urgency, and gave me a clear starting place. The first thirty days, in the end, are about listening more than talking, understanding before acting. It’s the only way to make the next sixty days meaningful. ## **Days 30 to 60: Building an action plan that aligns finance with strategy** By the second month, the fog has usually cleared enough to start crafting an action plan, one that ties directly to the company’s [strategic objectives](https://www.financealliance.io/6-steps-to-transform-fp-a-into-a-platform-for-strategic-alignment/). I never build that plan in isolation. By now, I’ve had dozens of conversations across the business, and those conversations inform the roadmap more than anything else. Finance must play a critical role in strategic decision-making. That means ensuring the business has good data to work with. Too often, companies collect [plenty of data](https://www.financealliance.io/mastering-data-storytelling/) but lack a unified source of truth. I once worked with a client whose CRM system captured client information and gross profit data, and they used these metrics to determine compensation for business developers. The problem was that certain direct costs existed only in the finance system, not the CRM. Because the two systems weren’t connected, they were calculating profitability incorrectly and overpaying commissions. That kind of disconnect can distort everything from [pricing strategy](https://www.financealliance.io/successful-pricing-strategies/) to [resource allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). This period is where I spend time understanding how the company analyzes [profitability](https://www.financealliance.io/profit-planning/): not just at the corporate level but also across geographies, business units, product lines, and clients. The questions I ask are simple: *Is the data accurate? Are we making decisions based on fact or assumption? Are we misallocating attention because the numbers don’t tell the full story?* The second month is also when tax strategy becomes relevant. Most companies with CFOs have tax advisers, but that doesn’t mean their advice is being integrated into long-term plans. [How much should you really be earning in 2025?Titles that once carried prestige are being redefined by technology, globalization, and a growing emphasis on strategic insight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-291.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/How-much-should-you-be-earning-in-2025-2.png)](https://www.financealliance.io/how-much-should-you-be-earning/) In one company, leadership was preparing to make a water’s edge election for state tax purposes in California. What they hadn’t considered was that the business planned to expand globally. The election could have had multi-year consequences that didn’t align with the company’s strategic ambitions. The tax advisers weren’t even aware of the expansion plans. Moments like that reinforce the CFO’s role as a bridge between strategy and [compliance](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/), ensuring that one doesn’t undermine the other. By this stage, I’m also building out the finance function’s roadmap, short- and long-term. I review the team’s skills and capabilities, [the systems we’re using](https://www.financealliance.io/10-best-financial-modeling-tools/), and the operational processes we rely on. I consider whether the team is structured effectively and whether people are actually happy in their roles. Sometimes alignment issues aren’t about talent gaps; they're about someone being placed in the wrong seat. A minor restructuring (moving a team member from AP into AR, for example, or shifting someone closer to the invoicing process) can reinvigorate both [performance](https://www.financealliance.io/32-cfo-kpis/) and morale. Finally, the second month is when KPIs become essential. Each company needs a subset of reliable KPIs that map directly to strategic goals. You never want to stand in front of a CEO or board and say, “The data I presented last month was inaccurate.” That’s why this period is about refining [KPIs](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/), validating data sources, and ensuring everything we present is trustworthy. [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-289.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--8.png)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) ## **Days 60 to 90: Executing, leading, and proving your impact** By the time I enter the final thirty days of this ninety-day [framework](https://www.financealliance.io/the-chief-financial-officer-competency-framework/), I shift from planning to execution. This is where leadership becomes visible and where people begin to form their long-term perception of how you operate as a CFO. Execution begins with the team. I spend significant time ensuring the finance team understands the company’s strategy, the roadmap we’re building, and why we’re doing what we’re doing. At the CFO level, you shouldn’t be handling day-to-day transactional work, but you absolutely must understand it. You need to trust the people doing that work, and they need to understand the “why” behind the changes you’re initiating. In this stage, I dig deeper into [budgeting](https://www.financealliance.io/surviving-budget-season-strategic-planning/) and [forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/). I want to understand how the budget was created: Did the team simply roll forward last year’s budget with a modest increase, or was it built through analytical rigor? Were acquisitions factored in? Product launches? Market expansion? R&D milestones? Understanding the current process is essential for rebuilding it later, because you will have to rebuild it. This period is also when I begin laying the groundwork for new systems or technological upgrades. No one implements a new financial platform in ninety days, but you can identify what you need, map out requirements, and begin the process. Similarly, if the team structure requires adjustments, this is when those conversations begin, not as punitive measures, but as ways to realign strengths and responsibilities. One of the most important responsibilities in this phase is [communicating](https://www.financealliance.io/cfos-role-in-investor-communications/) the vision upward to the CEO and board. They need to understand exactly how the finance function will support the company’s strategic objectives. Drawing from my experience as both CFO and CEO in public companies, I know that the board often views strategy differently from the CEO. They evaluate risk, scenario-plan, and think defensively. Meanwhile, CEOs naturally think offensively. The CFO sits between them. It’s our job to help the CEO communicate the evidence behind major decisions and to help the board understand the underlying rationale. By the end of the first ninety days, I monitor [KPIs](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) closely, track the early-stage initiatives, and communicate wins across the organization. Celebrating team accomplishments is essential. It builds momentum and reinforces the idea that finance isn’t just a compliance function, it’s a strategic partner. [Driving innovation: From CFO “no” to strategic growth partnerDiscover how finance teams can drive innovation, not block it. Learn how strategic finance leaders enable growth through risk-balanced decisions, scenario planning, and capital allocation frameworks.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-292.png)Finance AllianceKevwe Ijatomi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--5.png)](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) ## **Challenges every CFO encounters in the first 90 days** No matter how many times I’ve stepped into the CFO role, the early [challenges](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/) tend to rhyme. Cultural resistance to change is one of the most universal. People will swear that the old processes work “just fine,” even when they don’t. They’ll question new systems, new reporting structures, or new levels of rigor. The only way I’ve ever been able to overcome that resistance is through [relationship-building](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/). Those one-on-one meetings from the early days continue to pay dividends here. When people understand that the changes you’re making aren’t arbitrary (that they’re tied to their own goals, that they relieve bottlenecks, or that they protect the company) they’re far more willing to engage. Another frequent challenge is lack of stakeholder buy-in. This is why communication matters so much. When someone doesn’t understand why a process is changing, or why you’re introducing new controls, you have to explain the rationale. You can’t assume the value is self-evident. Sometimes, even with all the right steps, onboarding doesn’t go smoothly. I’ve lived that firsthand. I once accepted a [short-term CFO role](https://www.financealliance.io/finance-and-compliance/) with a company that admitted they were disorganized, lacked proper policies, and had compliance concerns. But as soon as I arrived, they pushed me almost exclusively into [M&A execution](https://www.financealliance.io/risks-of-mergers-and-acquisitions/), telling me to set aside the finance problems because the controller would handle them. That was a mistake, one I should have resisted. Behind the curtain were major financial reporting issues, including fraud. I had taken my eye off the part of the business I was actually hired to safeguard. Experiences like that are why I follow a methodical ninety-day process now. It protects both the company and the CFO. [How I’m thinking about AI after 27 years in financeAfter 27 years in finance, the fundamentals haven’t changed. We’re still chasing revenue, margins, and cash.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-294.png)Finance AllianceGeeta Malhotra![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5-.png)](https://www.financealliance.io/ai-in-finance-business-strategy/) ## **Advice for others entering the CFO role** When people ask what I’d tell my younger self before starting my first CFO role, the answer is simple: take a deep breath. The sheer volume of information in a new role can feel overwhelming. But if you ground yourself in a systematic approach, you’ll find clarity. Start with the org chart. Learn who the stakeholders are. Set up those one-on-ones early. And listen. Truly listen. You’ll learn more from those conversations than from any financial report. If you’re a direct report to a new CFO, [transparency](https://www.financealliance.io/financial-accountability/) is invaluable. Give your CFO everything you know about the company, including its risks, processes, pain points, and the details of the reports you manage. They’re relying on you to help them understand the terrain. You will know more about the company at that moment than they do, and the faster you share that knowledge, the faster the whole organization benefits. ## **Why the first 90 days matter** If I were to summarize the ninety-day blueprint, it would look something like this, though I won’t put it in bullet points, because life as a CFO [never fits into tidy lists](https://www.financealliance.io/business-process-optimization/). The first month is about understanding the business and the people who run it. The second month is about turning that understanding into a strategic plan. The third month is about executing that plan and proving (not through presentations but through tangible progress) that you’re steering the organization toward stronger financial health and [stronger alignment](https://www.financealliance.io/6-steps-to-transform-fp-a-into-a-platform-for-strategic-alignment/) with its strategic goals. You don’t get a second chance at a first impression. But if you approach the role with humility, curiosity, structure, and a willingness to listen, the first ninety days can build the foundation for long-term success, not just for you, but for the entire business. ### Your 2026 financial outlook starts here URL: https://www.financealliance.io/your-2026-financial-outlook-starts-here/ Last updated: 2026-01-30T14:17:59.000Z Global markets are shifting faster than ever. Economic realignment, political tension, and rising fragmentation are creating new pressures on finance teams who must deliver clarity in the face of uncertainty. This session brings **Convera**’s market experts directly to you, breaking down the real forces driving 2026. Expect clear, actionable insight on the economic, geopolitical, and FX trends that will shape your decisions, your exposure, and your competitive position over the months ahead. ### **Why you should watch:** - **Get ahead of 2026 volatility** by understanding the macro and currency shifts most likely to affect margins, cash flow, pricing strategies, and financial stability. - **Spot geopolitical and policy developments early**, enabling your team to anticipate supply chain impacts, tariff exposure, and shifts in trade flows. - **Strengthen forecasting, budgeting, and scenario planning** using frameworks built for multi-market uncertainty. - **Decode the forces reshaping finance in 2026,** from central bank pressure and inflation dynamics to tariff-driven fragmentation and a changing FX landscape. - **Walk away with practical tools and real-world scenarios** you can apply immediately to improve decision-making, strengthen risk strategy, and build organisational resilience. --- ### **Meet the speaker** **Steven Dooley*, Head of Market Insights, Convera*** Head of Market Insights at Convera, **Steven Dooley**, brings deep expertise in FX strategy and market trends with over 20 years in financial services. He regularly appears on **Bloomberg, Sky News**, and **Ausbiz**, providing commentary on global finance and currency markets. --- ### **About Convera** **Convera** is a global leader in commercial payments. With an unrivalled regulatory footprint and expansive financial network, Convera combines **tech-led payment solutions** with deep expertise in **foreign exchange, risk management, and compliance,** empowering businesses to move money smarter, faster, and more securely across borders. ### How finance certifications can boost your earning power in 2026 URL: https://www.financealliance.io/finance-certifications-can-boost-your-earning-power/ Last updated: 2025-12-09T09:53:47.000Z Companies increasingly demand finance experts who can [think strategically](https://www.financealliance.io/client-portfolio-fractional-cfo/), collaborate across departments, and use financial insight to drive real business decisions. If you want to stay relevant, accelerate your career, and command higher compensation, [certifications](https://certified.thealliance.io/course/fpa-certified-core) are fast becoming one of the smartest investments you can make. Recent data from our [Finance Alliance Salary Survey](https://www.financealliance.io/finance-salary-report/) shows this clearly: individuals with advanced credentials earn significantly more than their less-qualified counterparts, and mastering critical skills dramatically boosts earning potential. ## **Certifications and advanced training pay off** One of the most compelling findings from our salary survey is how education level correlates with compensation. Finance professionals holding a Master’s degree report average earnings of **$137,121**, compared with **$96,573** for those with only a Bachelor’s degree. That’s roughly a 40-45% differential, a huge jump reflecting the value organizations place on deeper training, broader knowledge, and (implicitly) the kind of [analytical](https://www.financealliance.io/operational-analysts-why-they-belong-in-finance-not-it-or-business-units/) and strategic thinking often honed in advanced studies. But academic degrees on their own aren't always sufficient, especially in a dynamic business environment where new [challenges](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/) and technology disrupt traditional models. This is where specialized certifications come into their own. They don’t just signal academic achievement, they demonstrate that you have the [up-to-date practical skills](https://www.financealliance.io/top-10-cfo-skills/) employers actually need. Consider what happens when you combine experience with skill mastery. The salary survey shows that respondents describing themselves as “still developing skills” earn just **$40,081** on average. In stark contrast, those who report having *mastered* their skills earn **around $147,549**. This massive gap underscores the reality that **capability drives value**: not just raw years on the job, but the tangible, validated ability to apply financial insight, adapt to new challenges, and contribute meaningfully to [business strategy](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/). Certifications are one of the most efficient ways to close that gap. [FX 101: Your foundation for modern FX risk managementA 7-part micro-learning series for high-growth finance teams Foreign exchange risk is no longer a “big-company problem.” As your business scales across borders, FX volatility begins to influence cash flow, forecasting accuracy, unit economics, pricing strategy, and even investor confidence. FX 101 gives your team the foundational knowledge to understand,![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-283.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_FX_Bound_Specific_Meta_.jpg)](https://www.financealliance.io/fx-101-course/) ## **From number-crunching to strategic partnership** Why is there such a premium on [advanced skills](https://www.financealliance.io/top-10-fp-a-skills-to-master/) and certifications? Because finance roles themselves have changed dramatically in recent years. Organizations face increasingly complex regulatory environments, volatile markets, rapid digital transformation, and fast-changing business models. In that context, finance functions must evolve. Reporting alone isn’t enough. Finance professionals are now expected to: - Provide **forward-looking** [**forecasts**](https://www.financealliance.io/use-ai-in-your-planning-and-forecasting/) rather than backward-looking accounting - Interpret financial data in a **business context**, turning numbers into insights - Influence strategic decisions through **clear communication and collaboration** - [Partner with non-finance departments](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) (operations, sales, product teams) to shape company strategy In short: finance teams must become **strategic partners** rather than isolated number-keepers. Traditional [accounting](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/) or finance training often falls short on these competencies. That’s why certifications focused on business partnering, forecasting, and [data storytelling](https://www.financealliance.io/financial-charts-and-graphs/) are in high demand: they bridge the gap between technical finance skills and real-world business impact. ## **Certifications that match real skills: What to look for** Given this shift, it’s not enough to pick any finance certification. The difference lies in **what the certification teaches**, **how practical it is**, and **how recognized it is in the industry**. Here are the key characteristics of a “worth it” certification: - **Focus on applied skills**: Not just theory, but frameworks, [tools](https://www.financealliance.io/10-best-financial-modeling-tools/), and methods you can use immediately at work. - **Business-partnering and communication skills**: Helping finance professionals translate numbers into persuasive stories and actionable insights. - **Forecasting, budgeting, and data interpretation**: Enabling professionals to plan ahead, build financial models, and make robust projections. - **Flexibility and accessibility**: Online, self-paced options accommodate working professionals. - **Recognition and credibility**: Certification from a respected organisation or instructor, ideally one with real-world finance leadership experience. When a certification delivers on these aspects, it gives you **real leverage** for [better roles](https://www.financealliance.io/chief-investment-officer-vs-chief-financial-officer/), higher [compensation](https://www.financealliance.io/fp-a-salary-and-career-path-guide/), and greater influence within your organization. [How much should you really be earning in 2025?Titles that once carried prestige are being redefined by technology, globalization, and a growing emphasis on strategic insight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-284.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/How-much-should-you-be-earning-in-2025.png)](https://www.financealliance.io/how-much-should-you-be-earning/) ## **How two leading certifications tackle the skills gap head-on** To illustrate how a modern finance certification can align with the needs above, let’s look at two courses we offer at The Alliance that are designed with today’s finance realities in mind. Both courses are 100% online, self-paced, and built around practical application. ### **Business Partnering & Storytelling Certified: Masters** This course is aimed at finance professionals who want to go beyond spreadsheets and reports, those who want to become strategic business partners. Over five hours of video lessons, [the course helps participants master](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters): - How to build strong working relationships across the business - Techniques to influence decision-makers and communicate complex financial insight in simple, compelling ways - Methods to turn raw financial data into narratives that drive business planning and strategic action By the end, learners are equipped to shift from “number cruncher” to “influential advisor,” ready to sit at the decision-making table. The certification offers lifetime access to all content (including slides, templates, example decks) meaning the learning doesn’t end when you pass the exam, but evolves as your career progresses. What this course offers aligns strikingly well with the areas where those who master their skills see the biggest payoffs in the salary survey. [Business Partnering & Storytelling Certified | MastersLearn the specific steps and techniques to drive profitability as a business partner with the #1 finance business partnering course on the market.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/aed38082539eca9d9b8e4ba1e12ca808-1.png)The AllianceThe Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/6faccc38e0d91a9012a0c81609560d22.jpg)](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters) ### **Budgeting & Forecasting Certified: Masters** Forecasting, modeling, budgeting are increasingly critical in a world where business leaders expect agility, rapid iteration, and financial foresight. [The Budgeting & Forecasting Certified: Masters course](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) equips finance professionals with the frameworks and technical know-how to build robust budgets, perform variance analyses, and deliver forecasts that guide strategic planning. Given that the most significant salary increases come with skill mastery, this course speaks directly to the core of what elevates a finance professional’s value in the job market. The course aligns with modern FP&A and strategic finance requirements: accurate forecasting, scenario planning, and financial discipline. [Budgeting & Forecasting course | Christian WattigLearn the specific techniques to build accurate, efficient and trackable budgets and forecasts from start to finish.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/aed38082539eca9d9b8e4ba1e12ca808.png)The AllianceThe Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/3e76cd6ed0de16ffd9f792779e867862.jpg)](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ## **The ROI of certification: Why it makes financial sense** You might be thinking: “Certifications sound great, but are they worth the cost and time?” The numbers suggest: yes, absolutely. Consider that mastering relevant skills correlates with an average salary of **$147,549**, compared with **$40,081** for those still learning. That difference alone can more than cover the cost of multiple certifications many times over. Even against the backdrop of passive [career progression](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) (years of experience), the premium for demonstrated mastery is enormous. A certification that takes a few hours (but delivers frameworks, skills, and confidence) can accelerate your trajectory in a way that years on the job sometimes cannot. On top of that, because both of the courses above are self-paced and online, you don’t need to take a career break, relocate, or sacrifice your current role. You can learn while working, and often apply what you learn immediately, giving you a fast return on investment. ## **Who benefits most from certifications?** So, who stands to gain the most from taking a finance certification now? Here are a few common scenarios: - **Early to mid-level finance professionals**: If you want to progress beyond transactional accounting or reporting roles into more strategic, [FP&A](https://www.financealliance.io/top-10-fp-a-skills-to-master/), or business-partnering positions, certifications help you build the mindset, skills, and language to make that leap. - **People moving from technical finance roles to business-facing ones**: For accountants who have strong technical acumen but lack [stakeholder-facing](https://www.financealliance.io/stakeholder-communication-plan/) experience, the “Business Partnering & Storytelling” course helps develop communication and influence skills that are rarely taught elsewhere. - **Experienced professionals looking to future-proof their careers**: As automation and AI change the finance landscape, strategic insight, [forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/), and storytelling will remain in high demand. Certifications help senior professionals stay relevant and position themselves for leadership. - **Finance teams in transition**: If your company is growing fast or shifting to a more strategic operating model, having team members with certifications can help embed [best practices](https://www.financealliance.io/12-financial-modeling-best-practices-to-avoid-frustrations/), discipline, and a common language across the whole finance function. In short: whether you are just starting out, aiming for promotion, or planning long-term, a well-chosen certification can be a career multiplier. ## **Why these skills and certifications will be critical in 2026** The finance profession is at a crossroads. Basic accounting and routine reporting are more automated than ever. [Software tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/) handle reconciliations, bookkeeping, and even basic forecasting. As that happens, the real value of finance professionals shifts toward interpretation, insight, influence, the human, strategic side of finance that machines cannot replicate. Organizations increasingly expect finance teams to be proactive partners in shaping strategy, not just reactive record-keepers. That means being able to communicate clearly with non-finance colleagues, build trust, influence decisions, translate data into business impact, and think long-term. So, certifications focused on business partnering, [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), and storytelling are essential. These credentials directly align with the skills that are becoming increasingly scarce and valuable. [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-285.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-7.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### Top-down vs. bottom-up forecasting: Decoding sales forecasts URL: https://www.financealliance.io/top-down-vs-bottom-up-forecasting/ Last updated: 2026-02-07T09:08:40.000Z Top-down vs bottom-up forecasting: Which method should you use to create accurate sales forecasts? Top-down and bottom-up forecasting are two commonly-used techniques for building sales [forecasts](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/). However, the debate on which one is superior is still ongoing. Choosing the right forecasting method for your business is important, which is why we’re exploring the ins and outs of both to help you choose the right method for you and your business. ## **Qualitative vs quantitative forecasting methods explained** Forecasting isn’t a one-size-fits-all endeavor. In fact, it’s often a balancing act between two distinct approaches: [**qualitative and quantitative**](https://www.financealliance.io/financial-charts-and-graphs/) **forecasting**. Let’s break down what sets them apart and when you might reach for one over the other. ### **Qualitative forecasting** It leans on expert judgment, intuition, and the collective wisdom of teams. Think of it as the artful side of forecasting. It’s what you use when there’s little historical data to draw from, like launching a brand-new product or navigating a market disruption. You’ll find yourself gathering insights from [sales](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) leaders, conducting customer interviews, or even running focus groups. Qualitative methods dig into the story behind the numbers, not just the numbers themselves. ### **Quantitative forecasting** This method, on the other hand, is all about the numbers: hard data, statistical models, and mathematical relationships. This is where you’ll see regression analysis, time series models, and correlation studies come into play. According to [Asrar Syed, Finance Director of Bank Operations of HSBC](https://www.linkedin.com/in/asrar-ahmed-s-a23058b/): > “Forecasting is all about correlations. If you understand the correlations of internal factors to the organization or and the external factors, forecasting is just an algebra on top of that.” Quantitative methods shine when you have robust historical data and want to let the numbers do the talking. **So, when should you use which?** If you’re entering uncharted territory (new markets, products, or sudden disruptions) qualitative methods can provide context and direction. When you’ve got plenty of [reliable data](https://www.financealliance.io/10-best-financial-modeling-tools/) and want precision, quantitative methods are your best bet. In practice, most finance teams blend both, layering expert insight on top of statistical rigor. That’s where the magic (and the accuracy) happens. ## **What is top-down forecasting?** Top-down [forecasting](https://www.financealliance.io/14-dos-and-donts-financial-forecast/), as the name suggests, starts from a high-level perspective, and then trickles down to the specifics. This vantage point makes it easier to gather essential intel to predict a company's financial trajectory, including: - Historical company [performance](https://www.financealliance.io/32-cfo-kpis/) - Growth rates across the industry - Key economic indicators Once the overall projections are established, they’re divvied up among individual departments, teams, or product lines. These projections shape detailed sales budgets and production capacity plans. The top-down approach to [forecasting](https://www.financealliance.io/14-dos-and-donts-financial-forecast/) has earned a fan base among large organizations and those juggling multiple divisions as it grants a holistic perspective of the entire business. [Wall Street Prep](https://www.wallstreetprep.com/knowledge/top-down-forecasting/) describes the top-down approach as estimating "*future sales by applying an implied market share percentage to a total market size estimate.*" (see formula image below). ![Top-down sales forecast formula](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/data-src-image-zzgzmn6xdd.png) Source: [Wall Street Prep](https://www.wallstreetprep.com/knowledge/top-down-forecasting/) The charm of top-down forecasting lies in its knack for weaving a cohesive narrative of a company's financial future, grounded in its strategic [goals and aspirations](https://www.financealliance.io/top-10-fp-a-skills-to-master/). However, top-down forecasting isn't without its drawbacks. Since this method relies heavily on historical data and market trends, it doesn't always account for sudden changes in the market. ## **What is bottom-up sales forecasting?** Bottom-up forecasting takes a more granular approach to sales forecasting. It starts from the ground level and builds up toward the [overall financial outlook](https://www.financealliance.io/navigate-global-volatility-with-confidence/). This method is all about nurturing the wisdom of individual departments and teams. It's a great option because it focuses on using their insights to create detailed forecasts tailored to specific areas of the business. Collaboration is at the heart of bottom-up sales forecasts. Each team rolls up its sleeves and crafts its own sales, revenue, or production forecasts. All of which are informed by their [knowledge of the market](https://www.financealliance.io/fx-assessment-tool/), customer demands, and in-house capabilities. Once these customized forecasts are wrapped up, they're woven together to form a comprehensive financial tapestry for the entire organization. [Wall Street Prep](https://www.wallstreetprep.com/knowledge/bottoms-up-forecasting/) summarizes bottom-up forecasting as "*breaking a business apart into the underlying components that ultimately drive its revenue generation, profits, and growth*." (see formula image below). ![Bottom up forecast formula](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/data-src-image-2slu8qurwcq.png) Source: [Wall Street Prep](https://www.wallstreetprep.com/knowledge/bottoms-up-forecasting/) The allure of bottom-up forecasting lies in its ability to harness the unique insights of those who are deeply immersed in the day-to-day operations of the business. This can lead to more accurate and realistic forecasts, as it reflects the current market conditions and the capabilities of each department. However, bottom-up models also come with some challenges. Since this method is built on the input of various departments, it can be time-consuming and [resource-intensive](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) to collect and consolidate the data. Plus, without a unifying framework or guidance from the top, it's easier for forecasts to stray from the company's overarching goals. ### A step-by-step guide to bottom-up sales forecasting Ready to roll up your sleeves? Building a bottom-up sales forecast is all about starting with what you know — actual sales activity, rep-level insights, and pipeline data — and layering on structure and collaboration. Here’s a practical, step-by-step guide: 1. **Gather granular data.** Pull historical sales, CRM records, and pipeline reports. The more detailed, the better. Don’t forget to check for data gaps or inconsistencies; integrity here is everything. 2. **Set clear assumptions.** Work with sales leaders to agree on key drivers: conversion rates, average deal size, sales cycle length, and rep productivity. Document these assumptions so everyone’s on the same page. 3. **Build from the ground up.** For each rep or team, estimate the number of deals, expected close rates, and average revenue per deal. Aggregate these at the team, product, or regional level. 4. **Consolidate and validate.** Combine all inputs into a master forecast. Now’s the time to spot outliers and double-check for manual errors. Platform integration can save you headaches, as well as from being burned by disconnected spreadsheets. 5. **Collaborate and iterate.** Share the draft with stakeholders. Invite feedback and challenge assumptions. This isn’t just a numbers exercise; it’s a team sport. 6. **Review and adjust.** Compare your forecast to actuals regularly. Learn from misses, refine your inputs, and keep improving. ### Bottom-up ARR modeling for SaaS companies [Annual Recurring Revenue (ARR)](https://www.financealliance.io/understanding-the-rule-of-78s-a-critical-tool-for-recurring-revenue-forecasting/) is the lifeblood metric for SaaS businesses. It’s what gives you, your board, and your investors a clear sense of predictable, repeatable revenue. But building a bottom-up ARR model isn’t just about plugging numbers into a spreadsheet. Instead, it’s about capturing the real, day-to-day mechanics of your customer base and product lines. Let’s break it down. Start by segmenting your customer base—think new business, renewals, expansions (upsell/cross-sell), and churn. For each segment, estimate: - Number of customers (by cohort or segment) - Average contract value (ACV) or subscription price - Expected churn rate (monthly or annual) - Upsell/cross-sell rates From there, the formula for ARR is straightforward: ARR = (Number of customers × ACV) + Upsell ARR – Churned ARR For example, if you have 500 customers paying $2,000/year, with $50,000 in annual upsells and $20,000 in churned contracts, your ARR is (500 × $2,000) + $50,000 – $20,000 = $1,030,000. But don’t stop at the math. Map your funnel from website visitors to sign-ups, then to paid conversions, and finally to recurring revenue. And don’t forget to factor in marketing costs, as customer acquisition can significantly impact your bottom line. Build your model in layers. Start with conservative assumptions, then stress-test with best- and worst-case scenarios. And always sanity-check your numbers against actual billing data. ARR modeling is as much about discipline as it is about optimism. ## **Top-down vs bottom-up forecasting: What are the main strengths and weaknesses?** The great forecasting debate between top-down and bottom-up methodologies continues. While both methods aim to predict a company's financial future, they differ significantly in their approach, focus, and implementation. To help you make an informed choice, let's dive into the main differences between these two forecasting techniques: ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/data-src-image-tw07tv08s8e.png) ### **Top-down forecasting:** **Starts with a big picture** Top-down forecasting begins with a macro view of the market, industry trends, and overall economic conditions, and then works its way down to specific departments and teams. **Management-driven** This approach is primarily driven by the management team, who sets [financial goals](https://www.financealliance.io/10-big-picture-financial-planning-steps/) and expectations for the company. **Focus on macroeconomic factors** Historical company performance, industry growth rates, and economic indicators heavily influence top-down [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/). **Faster implementation** Since the top-down method relies on high-level data and projections, it can be implemented more quickly than its bottom-up counterpart. **Potential for unrealistic expectations** Due to its reliance on historical data and macro-level trends, top-down [forecasting](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) may not always account for unique circumstances or sudden market changes. This can result in unrealistic expectations for individual departments or teams. ### **Bottom-up forecasting:** **Starts at the operational level** Bottom-up forecasting begins at the ground level, focusing on the input and expertise of individual departments, teams, or product lines. **Employee-driven** This approach is rooted in the knowledge and insights of employees involved in business operations. **Focus on individual departments & projects** Bottom-up forecasting considers the unique needs, capabilities, and market conditions of each department. Doing so results in tailored forecasts for specific areas of the business. **More accurate & detailed** By leveraging the expertise of those closest to the action, bottom-up forecasting can yield more accurate and [detailed financial projections](https://www.financealliance.io/rolling-forecast-best-practices/). **Time-consuming process** Collecting and consolidating data from various teams is a labor-intensive and time-consuming process in the bottom-up approach. [Use AI in your planning and forecasting processA no-hype look at how AI can improve accuracy, speed, and strategic impact in planning![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-280.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FAnow---May-21.png)](https://www.financealliance.io/use-ai-in-your-planning-and-forecasting/) ## Reconciling top-down and bottom-up forecasts Discrepancies between top-down and bottom-up forecasts are almost inevitable. Just ask any FP&A manager who’s tried to bridge that gap. But why do these differences crop up? It usually comes down to diverging assumptions, data sources, and the natural tension between strategic ambition and operational reality. The top-down view might be shaped by high-level growth targets or market optimism, while the bottom-up approach is rooted in the gritty details: resource constraints, sales capacity, and actual pipeline health. So, how do you bring these two worlds together? Here’s a practical, step-by-step process that’s worked for many finance leaders: 1. **Lay both forecasts side by side.** Start by documenting the key drivers and assumptions for each. What’s influencing the top-down number? What’s underpinning the bottom-up build? 2. **Identify and quantify the gaps.** Is the top-down forecast 20% higher than the bottom-up? Where are the biggest deltas — volume, pricing, churn, or something else? 3. **Facilitate a two-way dialogue.** According to Asrar Syed, Finance Director of Bank Operations at HSBC: “You need to allow on ground numbers to be real, so you need to let them be how they are. Let them play out. That’s part of the process. You then do a gap analysis and say, ‘Alright. This is the gap.’” 4. **Iteratively adjust assumptions.** Revisit the drivers on both sides. Can the bottom-up teams stretch targets with more resources? Does the top-down plan need to temper its expectations? 5. **Document consensus decisions.** Make sure everyone’s voice is heard (even if not every wish is granted). This builds buy-in and helps embed the plan across the organization. 6. **Align with business strategy.** The final forecast should reflect both operational realities and strategic goals—never just one or the other. 💡 Don’t rush this process. It takes time, but the payoff is a plan that’s both credible and actionable. And yes, you’ll probably revisit it more than once as conditions change. ## **Top-down forecast advantages** ### **Saves time** One of the most significant advantages of top-down forecasting is the time it saves. This method is considerably faster than bottom-up forecasting, as it avoids the detailed [data analysis](https://www.financealliance.io/data-cleaning-techniques/) that can slow down the process. ### **Positive viewpoint** Top-down forecasting often presents a more optimistic outlook on future sales performance. By focusing less on hard numbers, companies can emphasize future opportunities and potential growth, rather than being bogged down by current capacity or limitations. This positive perspective can help [boost morale and encourage teams](https://www.financealliance.io/5-change-management-strategies-finance-transformation/) to strive for better results. ### **Variability** This forecasting method is great for pre-revenue companies or those with irregular revenue streams. Since it’s less reliant on granular business data and real numbers, it allows for variability within a forecast period *without* significantly impacting accuracy. This flexibility makes top-down forecasting a more suitable choice for businesses with fluctuating financial performance. ### **Alignment** Top-down forecasting begins with the company's strategic goals and [aligns departments and teams](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/) to work together towards a shared vision. This unified approach keeps everyone on the same page and focused on achieving the company's objectives. ### **Consistency** One of the strengths of top-down forecasting is the consistent outlook it promotes throughout the company. This consistency makes communication and [decision-making more efficient](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/), as everyone is working with the same set of expectations and goals. ### **Simplicity** The top-down approach is user-friendly and easy to understand. So, it's a great choice for a wide variety of companies, regardless of their size or industry. [Navigating the trifecta: Growth, sustainability & complianceHow finance leaders can harness AI, automation, and business insight to drive growth, manage risk, and stay relevant in a changing world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-281.png)Finance AllianceParul Goel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--78--1.png)](https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/) ## **Bottom-up forecast advantages** ### **Grounded goal-setting** While top-down forecasting leaves room for subjectivity, bottom-up forecasting hones in on actual [performance](https://www.financealliance.io/32-cfo-kpis/) figures. This method may not offer as optimistic a view as top-down, but it ensures your forecasts are rooted in reality and more likely to be accurate, leading to attainable goals. ### **Detailed predictions** A key strength of bottom-up forecasting is its attention to detail. In contrast to top-down forecasting, which adopts a wide-angle lens on [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) and sales performance, bottom-up forecasting enables precise predictions related to specific products or services, customer segments, or geographic regions. ### **Increased employee engagement** Employee involvement is crucial for any organization striving to achieve sales targets. Bottom-up forecasting takes into account [historical and current sales data](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/), meaning employees contribute to its collection and offer valuable context. By involving and engaging employees in the forecasting process, they're more likely to be motivated to work toward the forecasted outcomes. ### **Adaptability** Bottom-up forecasting is very adaptable, making it ideal for sudden market changes and unexpected situations. Bottom-up forecasting is adaptable. This is because it relies on the insights and expertise of employees who are directly involved in business operations. These employees are closest to the action. ## **Which forecasting method should you choose?** Choosing the right forecasting method for your organization is essential for effective financial planning and decision-making. To help you select the best approach, consider the following tips and advice: ### **1\. Evaluate your organization's size and structure** Smaller companies or startups may find bottom-up forecasting useful. It offers detailed, ground-level insights. On the other hand, larger organizations with multiple divisions may prefer top-down forecasting. This method provides a big-picture perspective. ### **2\. Consider the nature of your business and industry** The adaptability of bottom-up forecasting may be a better fit if your industry experiences rapid changes. Alternatively, it could also be suitable for businesses that operate in a niche market. However, if your company is part of a more stable industry, top-down forecasting could be sufficient. ### **3\. Assess the availability and quality of your data** If your organization has access to reliable, high-quality data from various departments and teams, you can leverage this information for more accurate predictions using bottom-up forecasting. On the other hand, if data collection and consolidation are challenging, top-down forecasting might be more practical. ### **4\. Determine the level of employee involvement desired** Bottom-up forecasting may be the way to go if you're looking to foster employee engagement and ownership in the forecasting process. But if your focus is on aligning the entire organization with strategic goals, top-down forecasting might be a better fit. ### **5\. Consider the time and resources available** If you need a faster forecasting process, top-down forecasting can [save time](https://www.financealliance.io/budget-timelines/) and resources by using high-level data. On the other hand, if you have the time and resources to invest in a more detailed and accurate forecast, bottom-up forecasting may be worth the effort. ## When to use bottom-up vs. top-down forecasting Choosing between bottom-up and top-down forecasting is about context, company culture, and your business goals. So, when does each approach shine? - **Startups and small businesses:** Top-down works well when you need a fast, big-picture estimate, especially if you’re light on historical data. A top down budget approach is much easier in a startup because you have the ability to see the full picture. - **Enterprises and complex organizations:** Bottom-up is your friend when you need accuracy and buy-in across multiple departments. It’s ideal for organizations with diverse product lines or when operational realities can’t be ignored. - **Strategic planning:** Top-down is often used for setting ambitious targets and aligning teams with high-level goals. It’s quick, consistent, and great for board presentations. - **Operational planning:** Bottom-up is best for detailed budgeting, resource allocation, and surfacing risks early. It’s slower, but you’ll catch more surprises before they become problems. A hybrid approach is common. Start with a top-down target, then build up from the ground to validate or challenge it. The key is to make sure your method fits your stage, your data, and your decision-making style. And don’t forget to involve your business partners; shared ownership leads to stronger, more actionable plans. --- ## **A blended approach** In many cases, organizations can benefit from combining the best of both worlds. A blended approach is effective for financial planning. It ensures alignment with the company's strategic goals and provides [detailed insights](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/) and adaptability through bottom-up forecasting. You can combine the advantages of both approaches to create a more reliable, precise, and comprehensive financial forecast. This forecast can help you make better decisions and create better, more accurate sales forecasts. --- ## **FAQs - Top-down forecasting vs bottom-up forecasting** What is the main difference between top-down and bottom-up sales forecasting approaches? Top-down forecasting starts with a broader market perspective, then narrows down to the company's sales. Bottom-up forecasting begins with individual sales units and aggregates them to reach the overall sales forecast. Which approach is more accurate: top-down or bottom-up sales forecasting? It depends on the industry and company. Bottom-up forecasting tends to be more accurate because it considers granular details, but it requires more time and resources. Top-down forecasting is quicker but may not account for all factors influencing sales. When should I use a top-down forecasting approach? Top-down forecasting is best for industries with relatively stable market conditions, limited product offerings, or when a company has limited historical data to base forecasts on. When should I use a bottom-up forecasting approach? Bottom-up forecasting is ideal for industries with rapidly changing market conditions, diverse product lines, or when a company has extensive historical data to base forecasts on. How can I improve the accuracy of my sales forecasts? Continuously review and update your forecasting models, incorporate historical data, consider external factors, and use a combination of top-down and bottom-up approaches if feasible. Additionally, involve input from sales teams and other stakeholders. [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-282.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-6.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### Example of financial analysis that shows significant cost savings (interview question) URL: https://www.financealliance.io/example-of-financial-analysis-that-shows-significant-cost-savings/ Last updated: 2025-12-01T09:50:19.000Z Today I want to walk you through a concise, interview-ready example of a [financial analysis](https://www.financealliance.io/financial-charts-and-graphs/) that produced measurable [cost savings](https://www.financealliance.io/cost-benefit-analysis/). And show you the exact structure to use when you’re asked this in an [FP&A](https://www.financealliance.io/top-10-fp-a-skills-to-master/) interview. This question tests more than technical chops: it tests whether you can turn numbers into real business impact. Use the CAR framework (Context, Action, Result) and you’ll be clear, memorable, and persuasive. [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-277.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--6.png)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) ## **Why interviewers ask this question** Hiring managers want two things when they ask, “Can you give an example of a financial analysis that led to significant cost savings?” - Your analytical skill: Can you [pull the right data](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/), run meaningful variance analysis, and identify root causes? - Your business impact: Can you convert insights into operational changes that deliver measurable savings and earn stakeholder buy-in? ## **The CAR framework: Your interview playbook** Structure your answer around: - **Context** : What was the problem or trigger? - **Action** : What did you actually do (steps, tools, [collaboration](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/))? - **Result** : What measurable impact did your work deliver? Below are two real examples that follow CAR. Use one in an [interview](https://www.financealliance.io/cfo-interview-questions-and-answers/) and add a second, shorter case to show breadth. ## **Case study 1 – Manufacturing: Tackling rising production costs** ### **Context** I was working at a mid-sized [manufacturing](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/) company where production costs were climbing quarter after quarter and margins were being squeezed. The [CFO](https://www.financealliance.io/top-10-cfo-skills/) asked FP&A to investigate and identify potential savings. My brief was simple: find out what was driving rising costs and recommend actionable solutions. ### **Action: Five simple steps** 1. **Data gathering:** Pulled 12 months of cost data broken into raw materials, labour, utilities, and manufacturing overhead. 2. **Variance analysis:** Built an Excel model comparing actuals to budget to spot the largest gaps and the trends over time. 3. **Drill down:** Identified raw materials as the consistent driver of [over-budget spend](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). Not due to supplier price hikes but internal inefficiencies. 4. **Cross-functional work:** Partnered with procurement and operations. Together we discovered chronic over-ordering that led to spoilage and waste. 5. **Solution design:** Recommended a move to a just-in-time (JIT) ordering system and renegotiation of supplier contracts for improved [pricing](https://www.financealliance.io/successful-pricing-strategies/) and terms. ### **Result** - Within six months, raw material costs fell by **15%**. - Annualized savings were nearly **$500,000**. - [Inventory](https://www.financealliance.io/how-to-forecast-inventories/) carrying costs declined and production efficiency improved. - The CFO highlighted this as one of the company’s top financial wins for the year. This example shows FP&A as a business partner: it’s not just crunching numbers, it’s driving [cross-functional](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/) change that delivers measurable outcomes. [How to create a revenue plan that doesn’t fall apart by Q3This blog will walk you through the main components of a revenue plan, what good revenue planning involves, when to start and how to put together a plan that gets results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-278.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--7.png)](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) ## **Case study 2 – Process innovation** ### **Context** A company producing transmission parts was making a spare part for about **$58** using an old machining process. Engineers were sceptical of a new technique called fine blanking, fearing quality loss. ### **Action** - Finance approved a **90-day pilot** to test fine blanking. - Monitored cost per unit, defect rate, throughput, and material usage during the test. - Coordinated with engineering, production, paint, and assembly teams to measure end-to-end impact. ### **Result** - The new process cut cost per unit by more than **$15** (from \~$58 to significantly less). - Part accuracy improved, reducing defects and improving fit. - Production time dropped from weeks to days. - Material usage and waste decreased. - Ancillary improvements followed: paint shop adopted a more efficient spray method (lower coating cost and a smoother finish), and assembly reorganized workstations to reduce cycle time and worker fatigue. Instead of sacrificing quality to save money, the company gained both lower costs and [better performance](https://www.financealliance.io/32-cfo-kpis/). And engineers who were sceptical became advocates. Savings turned into a catalyst for wider operational improvements and a cultural shift toward continuous improvement. ## **Key lessons for FP&A practitioners** - Answer interview questions with the CAR structure: Context, Action, Result. Keep it concise and metric-driven. - Don’t limit your impact to dollars. Measure and communicate operational benefits: time saved, defects reduced, waste avoided, and capacity improved. - Work cross-functionally. Procurement, operations, and engineering will help you validate root causes and implement [sustainable](https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/) solutions. - Use short pilots to de-risk changes (the 90-day test is a great example). - Translate analysis into actionable recommendations. A model without implementation is only half the job. ## **How to present this in an interview** 1. Start with one clear CAR story (use specific numbers and timelines). 2. Add a second, shorter example to demonstrate range (process, pricing, vendor negotiations, or efficiency). 3. Highlight collaboration and how you influenced non-finance stakeholders. 4. Close with the broader business impact (annual savings, efficiency, quality improvements). > “Context, Action, Result this structure makes your answer clear, memorable, and impactful.” ## **Next steps and resources** If you’re serious about growing your [FP&A career](https://www.financealliance.io/fp-a-salary-and-career-path-guide/), focus on building both technical skills (variance analysis, modelling, Excel) and stakeholder skills (communication, partnering). Practicing CAR stories will make you interview-ready. I also run an accredited six-month FP&A certification and share free FP&A [resources, templates](https://www.financealliance.io/insider-membership-plan/), and interview prep material for people who want to level up. ## **Final thought** FP&A is not just about numbers. It’s about driving smarter, sustainable improvements. When you show both financial and operational benefits, other departments will trust and support your ideas. Use CAR, back it with data and pilots, and you’ll stand out in interviews and in the business. --- ***Article originally published*** [***here***](https://fpnaprofessionals.com/example-of-financial-analysis-that-shows-significant-cost-savings-fpa-interview-question-37/)***.*** --- Join other financial professionals who have already given their insights to the 2026 Salary survey. You'll be able to use this report to negotiate your next pay rise, so [take the survey](https://www.financealliance.io/finance-alliance-salary-survey/) and help us build a comprehensive report all finance leaders can use. [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-279.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-5.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### Top finance events to attend in 2026 URL: https://www.financealliance.io/top-finance-events/ Last updated: 2025-11-27T13:27:21.000Z 2026 is an exciting year with a range of finance events that offer opportunities to learn, network, and grow. 🌍 From finance conferences and workshops to in-person meetups and virtual events, we’ve got something planned for everyone! Have your calendar ready as we drop the ultimate round-up of top finance events to attend in 2026.👇🏽 --- ## [**FP&A Summit | San Jose**](https://events.financealliance.io/location/sanjose) **🇺🇸** **When:** February 25, 2026 Want to rub shoulders with the biggest names in FP&A in San Jose? Well, you can do just that at the FP&A Summit in February, 2026. We’re bringing together the brightest minds in finance for a day of unrivaled networking, learning, and discussion so you can: → Discover ways to innovate your processes and future-proof your FP&A strategy. → Successfully integrate emerging tech to leverage AI & automation for increased accuracy and efficiency. → Build a local network of FP&A connections within our global community. [Register now](https://events.financealliance.io/location/sanjose) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/05/Screenshot-2025-05-09-at-12.38.46.png) ## [**CFO Summit | San Jose**](https://events.financealliance.io/location/cfosanjose) **🇺🇸** **When:** February 25, 2026 San Jose is your boardroom for the day on this exclusive, insight-packed event built for the modern finance leader. Expect a powerful agenda covering: - How to future-proof your finance function and build resilience in the age of AI. - Informing data-driven decision-making with second-to-none data governance and visualization strategies. - Anticipating cyberattacks, making smart decisions and presenting recommendations with confidence to your executive leadership. - How to become an expert collaborator with your C-suite peers and engage key stakeholders across your business. ....and more! With high-impact panels, peer-led roundtables, and a hands-on workshop, you’ll walk away with actionable strategies and a refreshed vision for 2026. And yes, it all ends with a well-deserved happy hour 🍷, so you can unwind and network with your peers. This is *the* CFO event to circle on your calendar. 👇 [Request your invite](https://events.financealliance.io/location/cfosanjose) ![Finance conference event 2024](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/IMG_2404.jpg) ## [**FP&A Summit | Austin**](https://events.financealliance.io/location/austin) **🇺🇸** **When:** June 24, 2026 Join top finance minds at the FP&A Summit, where sharp strategy meets bold innovation. This one-day event is your backstage pass to what's next in finance leadership, tech transformation, and high-performance planning. What’s on the agenda? → Unlock your full strategic potential by leveraging AI and automation to enhance forecasting accuracy, data-driven decision-making, and business growth. → Future-proof your skillset to accelerate your career and foster a high-performing culture in your FP&A team. → Share insights and build lasting connections within a global community of finance professionals. Join us in Austin; the future of finance is being written here.👇 [Register now](https://events.financealliance.io/location/austin/) ![Finance event - people networking](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/finance-conferences-1.png) ## [**FP&A Summit | Boston**](https://events.financealliance.io/location/boston) **🇺🇸** **When:** September 24, 2026 Ready to connect with the brightest minds in FP&A on the East Coast? Join us in Boston next September for a day dedicated to leveling up your planning, forecasting, and performance strategy. We’re bringing together leading FP&A innovators to share real-world tactics, challenges, and breakthroughs, all designed to help you deliver measurable impact for your business. At FP&A Summit Boston, you’ll be able to learn from FP&A experts as they share proven methods and innovative strategies to: - Drive success with business partnering, - Improve forecasting accuracy, and - Unlock the full potential of an AI-enabled finance function. [Register now](https://events.financealliance.io/location/boston) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/11/FP-A-Boston.jpg) ## [**CFO Summit | Boston**](https://cfoevents.financealliance.io/location/cfoboston) **🇺🇸** **When:** September 24, 2026 Boston becomes your boardroom for the day at this exclusive, insight-packed gathering built for modern CFOs navigating rapid transformation (co-located with FP&A Summit). Expect an impactful day were you can meet with your CFO peers and gather insights on: → Building an agile finance function → Proven methods to engage board-level stakeholders → Integrating AI that actually drives profitability And yes, the day ends with a well-earned happy hour 🍷, giving you dedicated time to relax, connect, and expand your network within our global CFO community. [Request your invite](https://cfoevents.financealliance.io/location/cfoboston) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/11/CFO-Boston.jpg) ## [**FP&A Summit | London**](https://events.financealliance.io/location/london)🇬🇧 **When:** November 5, 2026 Ready to connect with the brightest minds in FP&A in one of the world’s most dynamic financial hubs? Join us in London for a day dedicated to leveling up your planning, forecasting, and performance strategy. We’re bringing together top FP&A innovators to share real-world tactics, challenges, and breakthroughs, all designed to help you deliver measurable impact for your business. You’ll learn from industry experts as they share proven methods and innovative strategies to: → Benchmark your processes and rejuvenate your procedures to future-proof your FP&A strategy. → Leverage the latest industry trends, AI & emerging tech to increase accuracy and amplify your output. → Build a local network of FP&A connections within our global community. [Register now](https://events.financealliance.io/location/london) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/11/FP-A-London-2.jpg) ## [**CFO Summit | London**](https://cfoevents.financealliance.io/location/cfolondon)🇬🇧 **When:** November 5, 2026 Co-located with the FP&A Summit, this is an exclusive day full of insights gathered for and by CFOs who are shaping the future of finance. Expect a powerful agenda where you can: - Be part of industry-shaping discussions with finance leaders. - Experience high-quality, peer-to-peer learning. - Discover the latest AI innovations. - Top up your CPD credits. You’ll experience high-quality, peer-to-peer learning in an environment designed for candid discussion, collaborative problem-solving, and lasting connection. [Request your invite](https://cfoevents.financealliance.io/location/cfolondon) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/11/CFO-London.jpg) --- ## **Other upcoming events** - CFO Summit | New York **🇺🇸** (May 6, 2026) - Banking/Treasury/Controller Summit | New York **🇺🇸** (May 6, 2026) - CFO Summit | Austin **🇺🇸** (June 24, 2026) - CFO Summit | Chicago **🇺🇸** (November 17, 2026) [Check our calendar for all events](https://events.financealliance.io/) ## **Hear from our attendees** Still on the fence? Hear from some of our attendees: 👇 ## **CPD and CPE credited finance events** We understand the importance of continuous learning and professional development, *especially* in finance, which is why we offer continuing professional development (CPD) and continuing professional education (CPE) credits when you attend any of our finance events. Once you complete our events (or courses), you'll receive an official certificate proving your commitment to professional growth. Simply submit this certificate to the relevant professional organization or regulatory body that governs your profession, and voilà, you've earned valuable CPD or CPE credits. --- ## Apply to speak 🎤 Would you like to speak at one of our upcoming finance events? Apply to speak below, and you'll hear back from us shortly!👇 *Keep up with our upcoming events by* [*joining our community*](https://www.financealliance.io/community/) *of finance professionals and remember to sign up for our newsletter, '*[*The Monthly Balance*](https://www.financealliance.io/finance-newsletter/)*' to stay in the know!* ### Why most mergers fail: Lessons from weather patterns and M&A due diligence URL: https://www.financealliance.io/why-most-mergers-fail/ Last updated: 2025-11-26T12:57:37.000Z I've always wanted to be a weatherman. Strange confession for someone who ended up as a [CFO](https://www.financealliance.io/top-10-cfo-skills/), right? But bear with me; this childhood dream has taught me more about successful [mergers and acquisitions](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) than any finance textbook ever could. Growing up in Connecticut, I was that kid glued to the Weather Channel, watching cloud formations and tracking storm patterns. Hurricane season in 1979 hit our state hard, and something about predicting these massive, complex systems just clicked for me. Fast forward a few decades, and here I am: not [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) weather, but trying to predict whether two companies can successfully merge without destroying each other in the process. [Top finance events to attend 2026 | Finance Alliance2026 is set to be an exciting year with a range of finance events taking place around the world that offer opportunities to learn, network, and grow.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-273.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Summit_Website_Article_Images_OnDemand-4.png)](https://www.financealliance.io/top-finance-events/) ## **The perfect storm: When two systems collide** You know what's fascinating about hurricanes? Sometimes two storm systems meet and create something called the Fujiwara effect. These tropical systems literally dance around each other until the larger one absorbs the smaller one, creating an even more powerful storm. Sound familiar? That's exactly what happens in mergers and acquisitions: two companies circling each other, trying to figure out if they'll create something stronger together or tear each other apart. Just like Hurricane Helene colliding with another weather front in the Appalachians created unprecedented damage, I've seen perfectly good companies [merge](https://www.financealliance.io/podcast/how-to-survive-a-post-merger-integration/) and create absolute chaos. The key difference is that weather systems don't have a choice, companies do. And that's where proper due diligence comes in. ## **The dating game of M&A** Let me be straight with you: most mergers fail because companies rush into marriage without properly dating first. In my 25 years working in higher education and finance, I've been on both sides of acquisitions. I've been the buyer, the seller, and even the "acquired" (my current university was purchased by another institution; yes, my school has a parent company, as weird as that sounds). Here's what I've learned: [successful M&A](https://www.financealliance.io/m-a-best-practices/) is like dating. You start with public information like checking out their [LinkedIn](https://www.linkedin.com/company/finance-alliance/), reading reviews, doing some light stalking (we all do it). That's your pre-due diligence phase. You're screening for obvious red flags before you invest real time and energy. ## **The Dunning-Kruger effect in action** Remember that confidence curve where you start off thinking you know everything, then realize you know nothing? That's every acquisition I've ever seen. CEOs meet at the country club, discover they're both in software, and boom: "”We should merge!” No. Just no. I've watched brilliant executives convince themselves that acquiring a company will be easy. "We'll just combine our sales forces and double our revenue!" they say. "We'll eliminate redundancies and save millions!" they proclaim. Then reality hits like a category 5 hurricane. ## **The three pillars of due diligence** When you move past the public dating phase into serious due diligence, you need to examine three critical areas: ### **Operational due diligence** This is where you discover that their star salesperson has one foot out the door, or that 80% of their revenue comes from one client who happens to be the CEO's golf buddy. I once worked with a company where a disgruntled employee walked out with the entire customer list on a thumb drive. Three months later, we discovered he'd taken half the clients with him to a competitor. ### **Financial due diligence** Private companies will show you what they want you to see. I've seen financial statements where [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) is reported differently on every document, "one-time" adjustments that happen every year, and [EBITDA](https://www.financealliance.io/ebitda-calculator-guide/) calculations that would make your head spin. My favorite? “Oh, that million-dollar severance package? That's just a one-time thing, don't worry about it.” ### **Legal due diligence** This is where the skeletons come tumbling out of the closet. Pending lawsuits, discrimination claims, vendor contracts that become void upon acquisition; these hidden landmines can obliterate your expected synergies faster than you can say “material adverse change.” ## **The culture clash nobody talks about** Here's the uncomfortable truth: even if the numbers work perfectly, culture misalignment will kill your merger. I'm living this reality right now. Two and a half years after our [acquisition](https://www.financealliance.io/acquisition-financing/), we still have massive culture gaps. It's like trying to blend two families where one believes in strict bedtimes and the other lets kids stay up until midnight. Good luck getting everyone on the same page. Remember those university acquisitions I mentioned? Boston College bought Pine Manor to diversify their student body. BU acquired Wheelock for their unique programs. Emerson purchased Marlboro for their real estate and endowment. Three different strategies, three different outcomes, but all struggling with the same challenge: making two distinct cultures work as one. ## **The EBITDA shell game** Let's talk about everyone's favorite metric: EBITDA. It's become the standard for valuing companies, but it's also the most manipulated number in finance. Every acquisition I've seen involves creative EBITDA adjustments. Sellers inflate it with aggressive add-backs, buyers project unrealistic synergies, and somehow everyone convinces themselves the numbers are real. Why EBITDA over free cash flow? Simple: it's easier to benchmark against similar companies. When you're comparing multiples across an industry, EBITDA gives you a quick and dirty valuation. But remember that quick and dirty often leads to expensive and messy. [Are you prepared to navigate the intricacies of an M&A?David Yates, CFO at Gresham, takes you on a journey through the intricacies of an M&A so you can unlock the best returns for your organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-275.png)Finance AllianceDavid Yates![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--48--3.png)](https://www.financealliance.io/are-you-prepared-to-navigate-the-intricacies-of-an-m-a/) ## **Protecting your investment post-merger** Here's where most companies drop the ball: post-merger integration. They spend months on due diligence, negotiate for weeks, celebrate the closing, and then... nothing. No integration team, no clear leadership, no plan for actually achieving those promised synergies. It's like my knee surgery story. First time around, I didn't do the pre-hab exercises. Post-surgery? I'm at 80% capacity, permanently. Second knee? I did everything right beforehand, and the results were dramatically better. Same surgeon, same procedure, completely different outcomes. The difference is preparation and follow-through. ## **The bottom line** After decades in this business, here's my advice: slow down. That company you're dying to [acquire](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/)? Date them first. Really get to know them. Look under every rock, ask the uncomfortable questions, and for heaven's sake, make sure your cultures align. Remember, unlike weather systems that have no choice but to collide, you get to decide whether to merge. And unlike weather forecasting, where being wrong just means carrying an umbrella, being wrong about an acquisition can destroy both companies. The synergies you're banking on? Cut them in half. The [cost savings](https://www.financealliance.io/5-cost-reduction-strategies/) you've identified? They'll take twice as long to realize. The cultural integration? It'll be three times harder than you think. But when it works (when you've done your homework, found the right partner, and executed a thoughtful integration) it's beautiful. Like those rare moments when two storm systems combine to bring perfect weather instead of destruction. Just remember: in both weather and M&A, it's always better to be the one doing the forecasting than the one getting rained on. --- *This article is based on Bill Guerrero's brilliant talk at our* [*CFO Summit event*](https://www.financealliance.io/events/)*.* --- **Join our (free)** [**Insider membership**](https://www.financealliance.io/insider-membership-plan/) **for exclusive content, real-world case studies, and so much more.** [Free Finance Alliance Membership - Become an InsiderJoin 1,000s other finance professionals and test drive your Finance Alliance membership without spending a dime.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-272.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Membership_Meta_Images_3.png)](https://www.financealliance.io/insider-membership-plan/) ### CFO Summit Chicago 2025 | OnDemand URL: https://www.financealliance.io/cfo-summit-chicago-2025-ondemand-pro/ Last updated: 2025-11-25T16:01:01.000Z Catch up with every talk from CFO Summit Chicago and hear from the likes of Duly, Brose, Creative Memories, SAP & more. _This post is for paying subscribers only._ ### FP&A Summit London 2025 | OnDemand URL: https://www.financealliance.io/fpa-summit-london-2025-ondemand-pro/ Last updated: 2025-11-25T14:29:02.000Z Catch up with every session from FP&A Summit London and hear from the likes of Personio, Microsoft, Kimberly Clark & more. _This post is for paying subscribers only._ ### CFO Summit London 2025 | OnDemand URL: https://www.financealliance.io/cfo-summit-london-2025-ondemand-pro/ Last updated: 2025-11-25T14:17:42.000Z Catch up with every talk from CFO Summit London and hear about the evolving role of the CFO from the likes of Edelman, RNIB, Payhawk, Zuora & more. _This post is for paying subscribers only._ ### CFO Summit 2025 | OnDemand URL: https://www.financealliance.io/cfo-summit-2025-virtual-ondemand/ Last updated: 2025-11-25T13:35:59.000Z Catch up with every session from CFO Summit and hear about the evolving role of the CFO from the likes of PepsiCo, Yext, Advanced Group, and more. _This post is for paying subscribers only._ ### FP&A and CFO Summit Boston 2025 | OnDemand URL: https://www.financealliance.io/fpa-and-cfo-summit-boston-2025-ondemand-pro/ Last updated: 2025-11-25T12:42:45.000Z Catch up on all sessions from FP&A and CFO Summits Boston and propel your finance function to new heights. _This post is for paying subscribers only._ ### FX exposure assessment tool URL: https://www.financealliance.io/fx-assessment-tool/ Last updated: 2025-11-21T16:07:54.000Z **Instant clarity on your currency risk - so you can act with confidence.** Foreign exchange exposure can be complex, scattered, and difficult to quantify. But understanding your risk is the foundation of every effective FX strategy. The **FX exposure assessment tool** gives finance teams a fast, accurate, and intuitive way to identify their exposures, stress test outcomes, and see how hedging can support financial stability and growth - all in minutes. --- ### **What the tool does** **1\. Exposure analysis** **Instantly map your FX exposure by currency pair.** Get a clean breakdown of your inflows, outflows, and net positions—paired with historical stress testing that reveals how market swings could impact your financials. **2\. Risk scenarios** **Compare the outcomes of different hedging strategies using real data.** Visualise how your results change under various market conditions, from doing nothing to implementing different protection strategies. See the trade-offs clearly - before making a decision. **3\. Smart guidance** **Tailored insights based on your unique exposure profile.** The tool highlights where your risk is concentrated, which exposures matter most, and which hedging approaches could best support your objectives. Actionable recommendations, no jargon. --- ### **Why finance teams use it** - **Clarity in minutes:** No spreadsheets or heavy analysis required - **Data-driven decisions:** Understand the impact before committing to a strategy - **Better conversations:** Equip your team with the language and confidence to engage on FX - **Built for high-growth companies:** Designed around the challenges of scaling internationally --- ### **See your FX risk clearly** Stop relying on guesswork, manual spreadsheets, or outdated assumptions. This tool breaks down your exposure with precision, making it easy to understand where risk is coming from and how it impacts your business. In partnership with [**Bound**](https://bound.co/). ### FX 101: Your foundation for modern FX risk management URL: https://www.financealliance.io/fx-101-course/ Last updated: 2025-11-21T16:05:21.000Z **A 7-part micro-learning series for high-growth finance teams** Foreign exchange risk is no longer a “big-company problem.” As your business scales across borders, FX volatility begins to influence cash flow, forecasting accuracy, unit economics, pricing strategy, and even investor confidence. **FX 101** gives your team the foundational knowledge to understand, communicate, and manage FX risk with clarity - without needing to be a market expert. Led by **Alex Bayle**, a seasoned FX practitioner with 20+ years of corporate FX experience, this 7-part video series breaks down the core concepts every modern finance team needs. Each video is **3–5 minutes**, sharp, and immediately actionable. --- ### **Course breakdown** - Understand what FX risk is, why companies hedge, and how hedging supports stability and growth. - Identify the core FX exposures in high-growth companies and know which to prioritize. - Spot hidden FX risks in scaling strategies and understand how they impact financial performance. - Learn why FX forecasting fails, quantify volatility costs, and shift from prediction to protection. - Grasp the fundamentals of passive hedging tools - forwards, swaps, and rolls - and when to use them. - Understand dynamic hedging tools - options, collars, and algorithms - including use cases and limitations. - Measure FX performance with the right KPIs, define what “good” looks like, and build continuous improvement. --- ### **Who this course is for** FX 101 is designed specifically for: - Finance teams at high-growth companies - FP&A teams responsible for forecasts and scenario planning - Controllers and treasury leads managing cash flow and currency exposures - Operators entering new markets or scaling internationally No jargon, no market theory - just the essential knowledge required to make smarter, more confident decisions. --- ### **Why teams love FX 101** - **Short, actionable modules:** Designed to fit into busy schedules - **Real-world examples:** Grounded in the challenges scaling companies face - **Practical frameworks:** Give your team a shared language for FX - **Expert guidance:** Distilled from two decades of hands-on corporate FX experience --- ### **Build confidence. Reduce risk. Support growth.** FX 101 equips your team with the foundation to understand FX, communicate its impact, and support smarter, more stable growth across borders. In partnership with [**bound**](https://bound.co/). ### 5 ChatGPT prompts to accelerate 2026 planning (without losing your mind) URL: https://www.financealliance.io/5-chatgpt-prompts/ Last updated: 2025-11-20T17:38:01.000Z You’re trying to lock 2026's financial plan while the data, priorities, and assumptions keep changing underneath you. Spreadsheets multiply, timelines shorten, and every stakeholder wants something slightly different from “the plan.” In this guide, **5 ChatGPT Prompts to Accelerate 2026 Planning (Without Losing Your Mind)**, Tropic shares five CFO-ready prompts you can drop straight into ChatGPT to speed up planning without sacrificing rigor or control. Rooted in how real finance and procurement teams work, these prompts help you pressure-test assumptions, align leaders faster, and turn AI into a practical copilot for your planning cycle, not a science experiment. ## **What this guide will help you master** This ebook is a set of plug-and-play prompts you can use today, here’s what you’ll walk away with: - A **strategic priority framework** that separates “run the business” work from true, trajectory-changing bets for H1 2026. - A **revenue and expense gap analysis** prompt to surface leakage, hidden inefficiencies, and the most actionable levers to close the plan. - A **scenario planning workflow for bookings** that ties pipeline, win rates, and headcount into clear conservative, base, and aggressive cases. - A **stakeholder communication prompt** to turn complex plans into crisp, audience-specific narratives for your board, leadership team, and department heads. - A **12-month procurement transformation roadmap** template that shows where automation and AI can unlock savings and speed without overwhelming your team. You’ll also get a simple “cheat code” to help ChatGPT tailor these prompts to your specific company size, stage, and goals in a single pass, so your outputs feel like they were written for your business, not a generic template. ## **Is this guide for me?** If you’re a finance or procurement leader heading into another planning cycle and thinking, *“There has to be a better way,”* this guide is for you. You’ll learn how to: - Use ChatGPT as a **force multiplier for FP&A**, not a risk to your rigor. - Quickly **align leadership on priorities, trade-offs, and bets** before you fight over line items. - Spot **budget leaks and underutilized spend**, especially across your SaaS stack, before they derail Q1. - Design **scenarios, sensitivities, and comms** that stand up to board-level scrutiny. - Treat **procurement as a strategic advantage**, with AI helping you move faster while still controlling risk and compliance. With the right prompts and a clear framework, you can turn 2026 planning into an opportunity to lead with clarity, speed, and confidence. **Download the guide and start planning smarter, not harder.** [Get your free copy](https://share-eu1.hsforms.com/1PIrwljOrS5u8GO9liqqZ-A2b1vun) ### The AI playbook for cost-savvy software purchasing URL: https://www.financealliance.io/ai-playbook-cost-savvy/ Last updated: 2025-11-20T17:36:00.000Z **Your renewals are getting more expensive.** Most companies juggle 200-600 renewals per year, yet teams still tackle them reactively, without the insight or leverage they need. This guide from Tropic, **The AI Playbook for Cost-Savvy Software Purchasing**, shows how AI flips the script, turning chaotic renewal workflows into strategic, data-backed advantages. Built for modern finance and procurement teams, this playbook gives you practical, plug-and-play prompts and workflows that help you cut costs, avoid hidden risks, and negotiate with confidence; no AI expertise required. ## **Who this playbook is for** This guide is for you if: - You manage software renewals but feel like vendors always have more information than you. - You suspect your company is overpaying for licenses, tools, or contract terms. - Your team is stretched thin and drowning in manual procurement tasks. - You want AI to accelerate your work but need a safe, practical way to begin. - You want renewals to become strategic wins, not last-minute headaches. **Teams using AI report 20% cost reductions, 70% productivity boosts, and faster approval cycles, so don't miss out.** ## **You’ll walk away with:** - A complete library of copy-and-paste prompts for renewals, supplier research, contract review, benchmarking, and negotiation. - Real examples showing how teams use AI to uncover risks and savings. - Frameworks to build AI-powered workflows that save time and drive impact. - Knowledge to run procurement with more insight than your vendors expect. ## **Don't let another renewal catch you off guard** Your vendors are already using AI. With this playbook, you can negotiate (and operate) with the same level of intelligence. Download Tropic's **The AI Playbook for Cost-Savvy Software Purchasing** and turn renewal season into a strategic advantage. [Get your free copy](https://share-eu1.hsforms.com/1CMWpUyF6Ti-w9up1lsNG3g2b1vun) ### The FP&A Journey: From Excel to AI URL: https://www.financealliance.io/fp-a-journey-from-excel-to-ai/ Last updated: 2026-01-16T11:00:48.000Z The mandate for finance has changed. It's no longer enough to simply report the numbers. What your business needs today is a strategic partner capable of shaping future performance. If your team is still buried in legacy tools and spreadsheets, you risk being left behind. Join us for this exclusive live session where Una Software's Darrell Cox will chart the critical FP&A maturity journey, moving from static, backward-looking reporting to dynamic, forward-looking guidance. Darrell will cut through the noise and hype surrounding AI, positioning it not as a replacement for the finance professional, but as a powerful catalyst. Discover how to unlock more accurate forecasts, accelerate decision-making, and deliver strategic insights at scale. [Watch OnDemand](https://pmmalliance.ondemand.goldcast.io/on-demand/578850c2-bd81-4f98-ae6b-0ae60cc3aeee) --- ### **What 's covered:** - Mapping the Maturity Curve: Learn how to navigate the modern FP&A landscape, moving your team from basic reporting duties to high-value strategic advisory. - Leveraging AI as a Catalyst: Discover practical ways to use AI for forecasting and business insight, rather than just viewing it as a buzzword. - Building a New Framework: Move beyond the spreadsheet to build a framework based on smarter processes, unified data, and embedded accountability. - Becoming a Strategic Partner: Identify the specific, actionable steps required to transition finance into a true driver of business strategy. --- ### Meet the speaker **Darrell Cox*, CFO, Una Software*** As CFO of Una Software, Darrell Cox combines deep financial expertise with product strategy to help build a platform no Finance professional can afford to be without. With over 25 years of leadership experience across early- and growth-stage companies, he has a proven track record of building high-performing teams and driving strategic growth. Darrell believes Finance creates the most value when it goes beyond reporting to deliver real business impact—and that belief is central to Una’s mission. ### Business process optimization: 5 inefficiencies to eliminate URL: https://www.financealliance.io/business-process-optimization/ Last updated: 2025-11-17T12:42:59.000Z As the financial lead of a company, CFOs are all about [reducing costs](https://www.financealliance.io/5-cost-reduction-strategies/) and making sure things are done *efficiently*. **Business process optimization** helps to achieve this by: 🔎 **Analyzing** how things are done across different departments. 🎯 **Streamlining** [operations](https://www.financealliance.io/operational-finance/) and removing unnecessary steps and/or redundancies. 💰 **Optimizing** processes to [save money](https://www.financealliance.io/corporate-treasury-guide-plus-3-strategies-to-save-your-company-a-fortune/), reduce waste, and get *more* done in *less* time. By optimizing business processes, you can help the company react better to fluctuating markets (and other ups and downs) by creating more *flexible* and *adaptable* processes. If you want to prioritize [business process](https://www.financealliance.io/17-finance-business-processes/) optimization as a [finance leader](https://www.financealliance.io/cfo-leadership-pillars/), there are a few key areas to look at. Some of the lowest-hanging fruit will be things like high-volume, repetitive tasks that bog down your team, or areas prone to errors that could lead to costly mistakes. To help you get started, we’ve listed **5** **process inefficiencies** you should try to eliminate. By streamlining these areas, you can create a ripple effect of efficiency gains across the *entire* company. So, let’s get into it.👇🏼 [Why CFOs fear budget season (and how to survive it)If your next budget could make or break your year, this guide is the most important thing you read.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-268.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Tropic_Whitepaper_Meta_--1-.png)](https://www.financealliance.io/how-to-survive-budget-season/) ## **Business process optimization vs. BPM vs. BPR: What’s the difference?** Before you dive into eliminating inefficiencies, it helps to clarify three foundational concepts: Business process optimization (BPO), business process management (BPM), and business process re-engineering (BPR). Each plays a distinct role in how organizations [improve their workflows](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/), but they differ in scope, approach, and when you’d use them. **Business process optimization** is all about making existing processes work better. Think incremental improvements to boost efficiency, cut costs, and reduce errors. It’s practical, ongoing, and often focused on streamlining what’s already there. **BPM**, on the other hand, is a broader discipline. It’s the structured approach to designing, [modeling](https://www.financealliance.io/10-best-financial-modeling-tools/), executing, monitoring, and optimizing all of an organization’s processes, often using specialized tools or software. BPM is about governance and continuous improvement across the board, not just one process at a time. **BPR** is the boldest of the three, as it involves fundamentally rethinking and radically redesigning core business processes. You’d turn to BPR when incremental tweaks aren’t enough and a process needs to be rebuilt from the ground up, often to achieve dramatic improvements in [performance](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/) or adapt to major shifts in strategy. Here’s a quick comparison for easy reference: | Approach | Scope | Typical use cases | Outcome | | -------- | --------------------- | ----------------------------- | ----------------------- | | BPO | Targeted process | Ongoing efficiency gains | Incremental improvement | | BPM | Organization-wide | Continuous process management | Sustained optimization | | BPR | Core/critical process | Major transformation needed | Radical change | In short: Business process optimization focuses on fine-tuning, BPM manages the whole lifecycle, and BPR is for transformative overhauls. Understanding these distinctions helps you choose the right tool for your unique business [challenge](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/). ## **The business process lifecycle: From design to optimization** Every optimized process starts with a [journey](https://www.financealliance.io/7-steps-of-the-finance-transformation-journey/), and understanding that journey is key for operations and project managers. The business process [lifecycle](https://www.financealliance.io/the-variance-analysis-cycle/) is a continuous loop that keeps your organization agile and efficient. Here’s how it unfolds: 1. **Design:** This is where you map out what the process should achieve and sketch the high-level steps. You’re defining objectives, roles, and the ideal flow. 2. **Modeling:** Next, you build a detailed representation, such as diagrams, flowcharts, or digital models. This stage lets you test scenarios and spot potential bottlenecks before anything goes live. 3. **Execution:** Now, you put the process into action. Whether manual or [automated](https://www.financealliance.io/fp-a-automation/), this is where real work happens and data starts flowing. 4. **Monitoring:** You track performance in real time, collecting data on speed, [accuracy](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/), and outcomes. This stage is crucial for catching issues early and benchmarking success. 5. **Optimization:** Here’s where the magic happens. You analyze the data, identify inefficiencies, and make targeted improvements. Then the cycle starts again. > “Klarity automates business understanding for process life cycle management... making it easier for organizations to identify efficiency opportunities and areas suitable for automation.” – **Nick Tiscornia, Chief Business Officer at Klarity** Remember, optimization isn’t a finish line, it’s an ongoing commitment. Each stage feeds the next, and the best organizations revisit this cycle regularly to stay ahead of change. ## **1.** **Manual data entry and outdated paper-based processes** Believe it or not, there are still finance teams that manually enter most of their data, making this one of the first business processes you should try to eliminate (or at least, *partially* eliminate). ![](https://media.tenor.com/Kt00_NI0XegAAAAC/gee-data-entry.gif) Ditching those stacks of paper and automating data entry will help your team: **Stop wasting time:** Manual data entry is slow and tedious. [Automating](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/) it will free up your team for more strategic tasks. **Fewer errors = better decisions**: Despite our best efforts, when we enter data manually, it's more likely to include mistakes. By automating it, you’ll have more accurate and reliable data to work with. **See things *clearly* so they can act *faster***: Outdated paper trails make tracking things down unnecessarily difficult, whereas you’ll gain real-time visibility if you go digital. ****Something to think about:** **Consider partnering with business optimization experts to identify the most impactful areas for automation and digitization within your finance function. Their experience can help you streamline processes quickly and ensure a smooth transition for your team.* ### **How to map and analyze your processes for optimization** If you want to spot inefficiencies and unlock real improvements, process mapping is your best friend. Here’s a step-by-step guide for business analysts and small business owners looking to get started: 1. **Identify the process you want to optimize.** Be specific, choose a workflow that’s high-impact or frequently causes headaches. 2. **Gather input from everyone involved.** Don’t just rely on documentation, talk to the people who actually do the work. Their insights are gold. 3. **Create a detailed process map.** Use flowcharts or swimlane diagrams to capture every step, decision point, and handoff. The more detail, the better. According to Nick Tiscornia: “Level five is just, like, deep detailed documentation, step by step process documentation, whether that's in a process flow diagram or or a narrative format.” 4. **Analyze the map.** Look for bottlenecks, redundancies, and manual steps. Ask: Where do delays happen? Where are [errors](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) most common? Which steps could be automated? 5. **Prioritize opportunities.** Not every inefficiency is worth fixing right away. Focus on changes that will deliver the biggest impact with the least disruption. 6. **Document your findings and recommendations.** This blueprint becomes your [roadmap](https://www.financealliance.io/your-guide-to-finance-transformation/) for future improvements. Nick also notes: “This gives you a super clear blueprint of that workflow, and is really the foundation for how you're gonna make decisions on that process in the future.” By following these steps, you’ll have a clear, actionable view of your process, and a practical starting point for [optimization](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/). ## **2\. Lack of integrated systems leading to data silos** If you have a bunch of disconnected systems and data silos, some might say that you’re just leaving money on the table. And, if you think about it, you *are*. Lacking integrated systems means data gets trapped in different places. Information isn't flowing seamlessly across departments, leading to possible issues with [reporting and analysis](https://www.financealliance.io/fp-a-automation/). The solution is technology optimization. Specifically, implementing [tools or software](https://www.financealliance.io/10-best-financial-modeling-tools/) that'll connect all your disparate data sources into one unified system. With an integrated system, you’ll have an easier time eliminating redundancies, automating data flows, and establishing a single source of truth (for [metrics](https://www.financealliance.io/32-cfo-kpis/)). ****Map out your core financial processes** like accounting, reporting, and forecasting. Look at how data moves between these systems. Any manual re-entry points? Places where disconnects happen? **Those* are areas ripe for integrating tools that will sync up data automatically. ## **3\. Poor communication and collaboration across teams** A lack of [communication and collaboration](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) can be a *major* headache, especially for CFOs who want to focus on business process optimization. One of the main reasons to build good communication across teams is that when departments don’t share insights, it leads to missed opportunities. For example, if the [finance team](https://www.financealliance.io/fp-a-team-structure/) adds late fees to customer bills *without* letting the sales team or customer service know about it, it can be a disaster. The sales reps will be unprepared to explain the new charges and customer service won’t have the information to address frustrated calls. This breakdown and lack of [communication](https://www.financealliance.io/how-wayfair-made-me-rethink-everything-i-knew-about-finance/) could end up damaging customer trust and waste valuable time resolving the issue. ![](https://media.tenor.com/QCWto5N6k0EAAAAC/caos-bob.gif) Some ways to help improve [communication and collaboration](https://www.financealliance.io/the-power-of-networking-case-study/) across teams include organizing cross-departmental meetings regularly. This will provide teams with the chance to talk to each other, share important information, and work together to optimize business processes that impact multiple departments. You could also look into investing in [collaboration tools](https://www.financealliance.io/finance-alliance-tools-of-choice-report-2023/) to share documents, real-time updates, and team discussions. This keeps everyone on the same page and makes accessing the information you need a lot easier (and less time-consuming). [How CFOs are using AI to transform financial presentationsAI tools can now enable CFOs to build board-ready decks in as little as four hours instead of 40+.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-269.png)Finance AllianceSalvatore Tirabassi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--7--1.png)](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/) ## **4\. Inefficient budgeting, forecasting, and reporting processes** [Budgeting](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), and reporting are *all* core financial processes. But if they're inefficient, it can be a serious drain on productivity and insights. As a CFO, you need to find ways to effectively streamline these areas to ensure financial data accuracy and enable smarter decision-making across the business. Here are some quick-fire tips to help you improve the efficiency of your company’s budgeting, forecasting, and [reporting](https://www.financealliance.io/financial-charts-and-graphs/) processes: ### **Budgeting** - Leverage past trends to set realistic budget baselines. - Assign budget responsibility to specific departments for [accountability](https://www.financealliance.io/financial-accountability/). - Update your budget regularly to reflect changing market conditions. - Save time by creating pre-formatted budget templates for future use. ### **Forecasting** - Model different outcomes to prepare for various market possibilities. - Get input from sales (including insights from sales process optimization efforts), operations, and marketing for more accurate forecasts. - Focus on [key metrics](https://www.financealliance.io/infographic-financial-performance-metrics/) that predict future performance, not just past results. - Use software to automate repetitive calculations and reduce errors. ### **Reporting** - Ensure consistency across departments for easier consolidation. - [Leverage charts](https://www.financealliance.io/financial-charts-and-graphs/), graphs, and dashboards for clear and concise [presentations](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/). - Free yourself from manual report creation with scheduling tools. - Highlight key insights and trends in your reports, [not just raw data](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/). [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-270.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--5.png)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) ## **5\. Slow financial close and reconciliation processes** If your company has slow [financial close](https://www.financealliance.io/month-end-close-checklist/) and reconciliation cycles, you may struggle with a few things. One concern is that the data won’t always be up-to-date. This means that the outdated financial data you're basing critical choices on could include inaccurate information, leading to poor [resource allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) and missed opportunities. Slow closes can also make it tricky to see your current cash position, which makes it difficult to manage expenses, negotiate with vendors, or plan for future [investments](https://www.financealliance.io/chief-investment-officer-vs-chief-financial-officer/). Not to mention that the longer it takes to close the books, the higher the chance of errors creeping in. A key part of your business process optimization strategy for this one is to establish a dedicated close calendar with strict but achievable deadlines. After each close, perform a “postmortem” to continually identify shortcomings and any areas that could do with better optimization in the *next* cycle. ## **Applying lean and Six Sigma to service-based processes** Lean and Six Sigma aren’t just for manufacturing, they’re powerful tools for service-based organizations, too. The core idea is to eliminate waste, reduce variation, and deliver consistent, high-quality outcomes for your clients and [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/). But applying these principles in a service context (like finance or healthcare) comes with its own set of challenges and adaptations. **Start with lean:** Map out your service process from end to end. Identify steps that don’t add value, like redundant approvals, unnecessary handoffs, or waiting times. Then, work with your team to streamline or automate those steps. In [finance](https://www.financealliance.io/17-finance-business-processes/), for example, automating expense approvals or digitizing invoice workflows can free up hours each week. **Next, bring in Six Sigma:** Collect data on your process performance. Where are errors or delays most common? Use tools like root cause analysis or control charts to pinpoint the sources of variation. Then, implement targeted improvements and measure the impact. Successful application in services means engaging stakeholders early, making data visible, and celebrating quick wins. It’s about progress. --- ### FAQs: Business process optimization What is optimal business process? An optimal business process is one that is streamlined, efficient, and adds maximum value while minimizing waste, delays, and costs. What are the fundamentals of business process optimization? The fundamentals of business process optimization include mapping processes, identifying inefficiencies, leveraging automation, standardizing tasks, and continuously measuring and improving.Of course, these might differ across different industries but most will generally include these core fundamentals. What is an example of optimization in business? An example of business optimization is automating data entry and validation through system integrations to reduce manual effort and errors. --- ### Want to optimize your processes even further? Our **Pro Membership** offers a unified source of trustworthy value for finance professionals to gain new knowledge and access templates and tools to help you optimise your daily activities and skyrocket your finance career to new heights. This membership plan helps you to gain access to the most recent resources, and a supportive community of peers who share your passion for achievement. Learn more about our [Pro Membership here](https://www.financealliance.io/pro-membership/). [Finance Alliance Pro membershipBe one of the first to join Finance Alliance’s membership where you can access world-class finance resources and the all-in-one platform for networking and career advancement.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-271.png)Finance AllianceCindy Yip![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Membership_Meta_Images_2.png)](https://www.financealliance.io/pro-membership/) ### Rethinking the FinOps tech stack: A conversation with Sage and Teads leaders URL: https://www.financealliance.io/rethinking-the-finops-tech-stack/ Last updated: 2025-11-14T14:00:54.000Z AI is no longer a side project sitting at the fringes of finance. For many teams, it’s becoming the difference between barely closing the books on time and actually helping shape where the business goes next. Their message is clear: [AI won’t replace the finance function](https://www.financealliance.io/ai-in-fp-a/) but it will fundamentally reshape what it spends its time on. > “The fun part of these jobs is to be able to sit there and really dig into what the data means. Not to spend all your time just trying to get to the point where you can start the analysis.” – **Mathew Reynders, Executive Vice President, FP&A and Investor Relations at Teads** This is where AI in the FinOps tech stack comes in: less time wrestling [spreadsheets](https://www.financealliance.io/gpt-4o-mini-in-excel-google-sheets/) and reconciliations, more time asking better questions, testing more scenarios, and delivering insight when it’s actually useful. ## **More than an ERP upgrade** Ask ten people what sits in the “FinOps tech stack” and you’ll probably get ten different answers. Marvin’s starting point is to strip away the hype and define it in practical terms. In his words, the FinOps tech stack is the combined system of record and system of work for the finance function: the accounting or [ERP system](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/), [planning](https://www.financealliance.io/profit-planning/) tools, billing and revenue systems, operational integrations to sales or delivery platforms, and all the adjacent [tooling](https://www.financealliance.io/15-best-fp-a-tools-and-software/) used to run finance day to day. Crucially, it’s not just about one big monolithic application. It’s an ecosystem of tools passing structured data between each other: journals, invoices, timesheets, contracts, [forecasts](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), actuals. That structure is exactly what makes finance such fertile ground for AI. > “When you’re operating with high volumes of structured data and repetitive processes, you get a really powerful use case for AI. You’re taking large data sets and asking the same questions over and over again. That’s where technology can do a lot of the heavy lifting.” – **Marvin Fletcher Rogers, Principal Consultant & Head of Business Development at Sage** In other words, the revolution doesn’t come from ripping out [your stack](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) and starting again. It comes from embedding intelligence into the tools you already rely on, so the system can do more of the work before it ever hits a human’s desk. ## **From hunting for data to asking better questions** For most [finance teams](https://www.financealliance.io/fp-a-team-structure/), the biggest bottleneck isn’t brainpower. It’s time. Mathew described a familiar reality: teams working late to validate figures, extract data, reconcile differences and chase down missing pieces before they can even begin to interpret [performance](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/). > “We spend a lot of time trying to make sure we’re accurate and that we’ve got the right information. You lose valuable time in those cycles of just getting to the point where you can start to think about what it means.” When that pattern repeats month after month, it quietly downgrades the role of finance. Analysts and [controllers](https://www.financealliance.io/cfo-vs-controller/) who were hired for their judgment and [strategic thinking](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) end up spending their energy copying, checking and cleaning. AI does not magically solve every data issue. But it can fundamentally rebalance where the effort goes. If the system can ingest transactions, apply learned patterns, flag anomalies and pre-prepare reconciliations, humans are no longer stuck in first gear. They can arrive at the analysis stage earlier in the process and stay there longer. > “It’s hard to be strategic if you’re constantly worrying whether the data is correctly assembled. The whole point is to free up time so teams can focus on the ‘why’, not just the ‘what’.” That shift might sound subtle, but it changes how finance shows up to every conversation. Instead of walking in saying, “We’re still waiting on the final numbers,” they can sit down and say, “Here’s what’s happening, here’s why, and here are the options.” ## **Automating the “boring but critical” parts of finance** The most powerful [AI use cases](https://www.financealliance.io/fintech-and-ai/) in finance aren’t necessarily the flashiest. They’re the ones that quietly take the worst manual work off people’s plates. Marvin pointed straight at month-end and quarter-end as prime examples. In many organizations, closing the books isn’t delayed because no one knows what happened. It’s delayed because thousands of tiny, repetitive tasks have to be performed and checked. Think of reconciliations between bank statements and ledgers, deferrals and accruals, [cost allocations](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), depreciation runs, revenue recognition schedules and adjustments for fat-fingered entries. > “So much of the close is taken up by reconciliations, adjustments and allocations. All of those are essential, but they are also highly repetitive and often predictable.” This is precisely where [AI and automation](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/) can earn their keep. Tools can learn what a typical journal looks like, which dimensions are usually used together, how a particular customer or vendor is normally coded, and which patterns signal a likely error. Instead of someone spotting a mistake only when they review a report days later, the system can surface it immediately: “Every month you post this entry to payroll; this time the amount is ten times higher. Are you sure?” That same pattern extends to: _This post is for paying subscribers only._ ### How to predict revenue in FP&A using machine learning URL: https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/ Last updated: 2025-11-17T10:14:48.000Z Did you know that you can predict revenue with [machine learning](https://www.financealliance.io/fpa-machine-learning/)? It’s a fascinating concept that FP&A teams can leverage to gain a significant advantage. By analyzing historical sales data, marketing efforts, economic indicators, and even customer sentiment, [machine-learning models](https://www.financealliance.io/ai-in-fp-a/) can identify patterns and trends that are difficult for humans to see. But how can FP&A teams utilize this type of [technology](https://www.financealliance.io/15-best-fp-a-tools-and-software/) in their roles? ## **Why does FP&A exist?** Before I get into the [future of FP&A](https://www.financealliance.io/future-of-fp-a/), I think it’s important to start at the beginning and think about *why* FP&A exists. In my opinion, FP&A’s main role is to help businesses make better decisions. We’re in charge of long-term [planning](https://www.financealliance.io/profit-planning/), monitoring market trends, and understanding in-depth business [performance](https://www.financealliance.io/32-cfo-kpis/). Based on those things, we provide insights and recommendations for future action. *FP&A is essential in shaping the company's long-term strategy.* ## **How data leads to better predictions and decisions** The most important part of our role in FP&A is to [collect and analyze data](https://www.financealliance.io/data-cleaning-techniques/). We can collect business data and base our predictions on it. For example, we can explore a large dataset to create reports ([variance analysis](https://www.financealliance.io/the-variance-analysis-cycle/)) and make accurate predictions. With those predictions, we can create budgets, and monthly forecasts, and share those insights with different [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/). And then we would have the business partnering side of [FP&A](https://www.financealliance.io/top-10-fp-a-skills-to-master/). This is when we step up as [strategic partners](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) to the business and converse with different heads of departments and even the C-Suite. Every [budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) and forecast we create influences the [future of the company](https://www.financealliance.io/9-upcoming-trends-that-ransforming-fp-a/). Once one cycle ends, another begins. ## **How FP&A makes predictions** Data holds insights that can help us make better decisions and take different actions. In the past, [predictions](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) were based on human judgment. So, finance professionals relied on their intuition and experience and a lot of it was based on gut feelings and instincts. The problem with that approach is that you risk sacrificing accuracy. Today, we collect data from different parts of the business and include other departments such as IT. They share their data with us, and we’re provided with a data summary. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-259.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-8.png)](https://www.financealliance.io/financial-charts-and-graphs/) Without a data summary, we couldn’t comprehend all the data given to us. We would have to look at *thousands* of rows of data and try to make sense of it all, something that our human brains can't possibly comprehend. So, data summaries are *processed* by humans. Usually, these are added to a [spreadsheet](https://www.financealliance.io/gpt-4o-mini-in-excel-google-sheets/) or dashboard. But once we have the data, how can we make decisions based on that data? Which data should we choose to create our [forecasts and budgets](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/)? And which data should we exclude? Not only that, but data alone isn’t enough to isolate us from human bias. That’s why I advise we [give machine learning a chance](https://www.financealliance.io/fintech-and-ai/). ## **What can FP&A achieve with machine learning?** Machine learning can scale your [data analysis](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/) because it can handle large data sets that would otherwise be impossible for a human to do on their own. It increases the accuracy of the predictions as well as the efficiency of the process. What’s more, it reduces human bias and it can even adapt to unknown situations. Machine learning can be trained. It knows exactly which data to choose and which data to ignore. All we need to do is provide the technology with information and it’ll process the data [automatically](https://www.financealliance.io/business-process-optimization/). The reason why I believe [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) and machine learning can work well together is because FP&A’s main goal is to improve the decision-making process (and machine learning can help us do that more effectively). [Driver-based forecasting for FP&A to align strategy with realityIf you haven’t tried driver-based forecasting for FP&A, this is your chance to really align your strategy with reality.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-264.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--73--2.png)](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/) In my previous role, we had tons of data but couldn't scale it. This made forecasting our [budget](https://www.financealliance.io/how-to-survive-budget-season/) difficult because we were unable to use the relevant data we needed. So, we searched for a solution and found it within machine learning algorithms. Using a tool called Profit, an open-source algorithm (created by Facebook) to forecast traffic, we were able to: - Improve [cash flow management](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) - Boost transparency with stakeholders - Better [resource planning](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) - Increase efficiency - Increase profitability - Improve decision-making - [Mitigate risk](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) As a result, we had a **100%** accurate forecast and increased profitability by **62%** for one product. The team was then able to focus better on [business partnering](https://www.financealliance.io/finance-business-partnering-playbook-2/) and guiding the strategy. Once we knew that our forecasts were so accurate, we were able to take action. We considered different variables including inflation rates, page views, holidays, and their impact on [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/), etc. We still used spreadsheets to load and store data, but never for analysis. We used the Python Profit Model for that. An issue that we had, though, was that not everyone in the team could code in Python, so we needed to figure out a way to increase transparency within the team. Here’s how we did it. [How AI is transforming financial modeling & sales forecasting in enterprise techThis article explores how AI is transforming financial modeling and sales forecasting (two pillars of enterprise strategy) and helping finance teams shift from reactive to proactive operations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-260.png)Finance AllianceSupreeth Meka![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--56--3.png)](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) Using machine learning technology, I could provide the data and then tell the model exactly what I wanted it to do. For example, I would ask it to forecast for the next quarter or even longer than that and it was able to run through the data and provide results within three seconds. The technology provided the [forecast](https://www.financealliance.io/how-to-forecast-inventories/) and it also alerted me to [different trends](https://www.financealliance.io/key-trends-shaping-the-future-of-finance/) it detected within the data, which made it easier for me to pinpoint what happened in those specific periods to assess why the trends/shifts in data occurred. ## **Will machine learning replace us?** Although machine learning technology is powerful, [it will *not* replace us](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/). Human judgment is still important and necessary. As technology continues to grow, human judgment will become even more valuable over time. Yes, machines have become better at forecasting, but they don't know what's happening in the business. Plus, they wouldn't be able to understand it in the same way that an [FP&A team](https://www.financealliance.io/fp-a-team-structure/) can. So, what does human judgment look like in practice? I want to give you an example. We were so accurate in our forecast that we already knew how our revenues would look for the next 24 months. But that number still wasn’t within the [company's goals](https://www.financealliance.io/10-big-picture-financial-planning-steps/). So, we already knew that we would be at 100 million, and we needed to reach 200 million. So, we started to introduce dynamic pricing. We either had to adapt and reach 200 million, or we would risk stagnation. The optimal solution was using human judgment and [AI-driven](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) solutions to power our strategy and hit our goals. [How CFOs are using AI to transform financial presentationsAI tools can now enable CFOs to build board-ready decks in as little as four hours instead of 40+.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-261.png)Finance AllianceSalvatore Tirabassi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--7-.png)](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/) ## **What's next for FP&A?** I predict that we will have accurate predictions to make better decisions. Although machine learning within FP&A is still quite new, if we can learn to leverage this technology in the right way, we will be able to focus our time on becoming better business partners. --- *This article has been adapted from Gabriela Gutierrez’s talk on predicting revenues using machine learning within FP&A (from our FP&A Summit in San Diego).* --- Our [**Salary Survey**](https://www.financealliance.io/finance-alliance-salary-survey/) will help you uncover whether you're being paid enough (and give you an edge when it comes to negotiating your next pay rise). But we need your thoughts first; your peers are already contributing their insights, so don't get left behind. [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-263.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-3.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### Why CFOs fear budget season (and how to survive it) URL: https://www.financealliance.io/how-to-survive-budget-season/ Last updated: 2025-11-12T04:43:32.000Z **Budget season.** The time when optimism meets Excel, when strategic vision drowns in endless “what if” models, and when CFOs across every industry feel the familiar mix of exhaustion, anxiety, and disbelief that (somehow) it’s that time again*.* For most organizations, [budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) season is chaos disguised as planning. [Forecasts](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) shift daily, targets contradict each other, departments scramble for approvals while the market outside moves faster than your models can refresh. And then, by the time the fiscal year begins, that 60-page “strategic plan” you spent months building becomes obsolete before it even launches. Russell Lester, President and CFO of Tropic, has lived through it all. In his new guide, [**Surviving Budget Season & Strategic Planning: 10 Tips from a CFO**](https://www.financealliance.io/surviving-budget-season-strategic-planning/), he distills two decades of hard-won experience into one reality check for modern finance leaders. > “How a company spends money is directly tied to where it’s placing its bets. Not all bets pay off. Some should no longer be made. Markets change, priorities shift. That doesn't mean the plan was wrong, it means we're not operating in a static universe.” This is a dangerous truth for leaders still treating budgeting as a [compliance](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) exercise rather than a competitive weapon. Below are **three of Lester’s ten CFO-approved insights**, the kind that separate teams who barely survive budget season from those who dominate it. You’ll have to [**download the (free) guide**](https://www.financealliance.io/surviving-budget-season-strategic-planning/) to get the rest of his tips. [10 CFO tips to navigate budgeting and planning with confidenceCFO-tested strategies to cut through the chaos, align stakeholders, and build a plan that actually lasts.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-258.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Tropic_Whitepaper_Meta_.png)](https://www.financealliance.io/surviving-budget-season-strategic-planning/) ## **1\. Budget season starts in the mirror, not in the spreadsheet** Most finance teams start planning in the wrong place: inside last year’s numbers. They dust off a stale Excel template, plug in “+10% growth,” and call it a baseline. But that shortcut is what kills [agility](https://www.financealliance.io/key-trends-shaping-the-future-of-finance/). Before you even touch a model, Lester insists on conducting a **“strategy retrospective.”** That means examining the bets your company made last year: - Which ones paid off? - Which ones fizzled? - Which ones looked smart at the time but ultimately distracted from the mission? This backward glance becomes your strategic MRI. It exposes blind spots and helps you separate what’s actually [driving growth](https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/) from what’s just keeping you busy. From there, Lester recommends recalibrating your entire financial narrative. Start by revalidating your 1–3–5-year plan, reevaluating your total addressable market, and honestly confronting the competitive realities reshaping your industry. In 2026, that means asking hard questions about [AI disruption](https://www.financealliance.io/ai-in-finance-business-strategy/), inflation, and global supply instability. Because pretending your model exists in a vacuum is the surest way to make it irrelevant. Only once your strategic direction is grounded in reality can your numbers begin to mean anything. > “Companies that thrive treat strategic planning as a year-round discipline, not a seasonal scramble. This is where balance, insight, data-centricity, judgment, and the ability to unify and align departments will become our new secret toolbox to weed out the noise.” ## **2\. Build a budget that balances ambition and sanity** Another insight hits where it hurts: **target setting.** This is where most organizations either ignite or implode. Executives want growth. Investors want returns. Employees want clarity. And the [finance team](https://www.financealliance.io/fp-a-team-structure/)? They’re the referee, forced to translate dreams into numbers. Lester argues that the most dangerous targets are the ones set by instinct. They’re too optimistic to be believable or too safe to be inspiring. Either way, they erode confidence before execution even begins. The solution lies in balance and data. He suggests the key [metrics every CFO should master](https://www.financealliance.io/32-cfo-kpis/): - **Rule of 40**: A test of balance between growth and profitability. - **Revenue per employee**: The ultimate litmus for operational efficiency. - **Unit economics**: The heartbeat of [sustainable growth](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/). But the real insight is in the mindset. According to Lester, target setting isn’t just a numbers game, it’s a trust game. When you present a plan to your board or team, they’re not judging your Excel formulas. They’re judging your judgment. A credible CFO knows how to thread the needle between aspiration and realism: ambitious enough to motivate, grounded enough to survive scrutiny. That credibility is currency. Lose it, and every future forecast becomes an uphill battle for belief. And if your organization doesn’t yet have the systems to anchor forecasts in data rather than gut feelings, that’s your red flag. Because no matter [how confident your presentation looks](https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/), if your budget is built on guesswork, you’re not [planning](https://www.financealliance.io/profit-planning/), you’re gambling. [Get your free guide](https://www.financealliance.io/surviving-budget-season-strategic-planning/) ## **3\. The hidden leaks that quietly destroy your growth** Every company has them, the silent killers of efficiency that CFOs don’t discover until it’s too late. Duplicated tools, overlapping software, contracts on auto-renew that no one remembered approving. Lester calls these leakages, the invisible losses that quietly drain your bottom line while everyone’s too busy chasing top-line growth. Great [finance teams](https://www.financealliance.io/how-fp-a-teams-build-budgets-and-how-you-can-nail-this-in-interviews/) develop a **“levers and leakages” framework**, a repeatable process for identifying not just where waste exists, but where opportunity hides. - **Levers** are accelerators: strategic actions that multiply results when pulled at the right time. - **Leakages** are inefficiencies: recurring costs, redundant vendors, or misaligned investments that sabotage ROI. The key is to make this process permanent, not reactive. Most companies only look for leakages at the end of a quarter, when the damage is already done. The best CFOs treat it as a living discipline, a financial flywheel that never stops spinning. He challenges finance leaders to ask uncomfortable questions: - Why are we still paying for tools that don’t ladder up to core priorities? - Which processes add complexity instead of [clarity](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/)? - What investments look strategic on paper but don’t move the needle in practice? ## **Why budget season fails most companies** Lester’s guide doesn’t romanticize budget season. It exposes it. He paints a brutally honest picture of why so many well-intentioned plans fail before they’re even finalized: - Budgets built on outdated assumptions. - Teams operating on emotion, not data. - Spend disconnected from growth priorities. - Finance teams stuck in firefighting mode instead of leading [strategically](https://www.financealliance.io/client-portfolio-fractional-cfo/). And here’s the uncomfortable truth: every dollar you misallocate today is a dollar that could have fueled your next strategic move. Every redundant [tool](https://www.financealliance.io/15-best-fp-a-tools-and-software/), every bloated department, every vanity project that survives the cut, it all compounds. By Q3, you’re not just missing targets but actually hemorrhaging confidence. And in an era where markets shift overnight and investors expect instant [accountability](https://www.financealliance.io/financial-accountability/), youcan’t afford to be surprised by your own budget. ****The companies that win in 2026 won’t be the ones that spend more, it'll be the ones that spend smarter** **.** ## **Download the full guide: 10 tips from a CFO who’s been there** These three insights barely scratch the surface. Russell Lester’s [**Surviving Budget Season & Strategic Planning**](https://www.financealliance.io/surviving-budget-season-strategic-planning/) goes deeper into the frameworks, decision models, and hidden CFO playbooks that transform how leaders approach planning entirely. If your next budget could make or break your year, this guide might be the most important thing you read before you finalize it. 👉 [**Download the full guide now**](https://www.financealliance.io/surviving-budget-season-strategic-planning/) and learn how to master the CFO strategies that will keep your business grounded, data-led, and resilient, no matter what 2026 throws your way. [Get your 10 tips to survive budget season](https://www.financealliance.io/surviving-budget-season-strategic-planning/) ### How CFOs can transform cyber risk from threat to strategic advantage URL: https://www.financealliance.io/the-cfo-role-in-cyber-risk-management/ Last updated: 2025-11-05T15:06:33.000Z [Cyber risk](https://www.financealliance.io/cfo-cybersecurity/) has evolved into a defining strategic issue. The famous British proverb, “To be forewarned is to be forearmed,” aptly captures the mindset that finance leaders must adopt. Cyber incidents can unfold within minutes and reverberate globally, so the [Chief Financial Officer (CFO) holds an increasingly vital role](https://www.financealliance.io/top-10-cfo-skills/), one that extends beyond financial oversight to shaping the organization’s resilience and long-term sustainability. Cybersecurity can no longer be viewed as an isolated technical function. Instead, it demands alignment between financial stewardship, operational control, and strategic foresight. As **Aarti Ajay** notes, the conversation around cyber risk is ultimately about how CFOs can leverage their strategic position to balance cost with [risk](https://www.financealliance.io/financial-crime-risk-management-fcrm/), transform vulnerabilities into strengths, and build a culture of preparedness across the enterprise. ## **Empowering the CISO: The strategic partnership** The relationship between the CFO and the Chief Information Security Officer (CISO) sits at the heart of effective cyber risk management. Over the past two decades, the CISO’s role has evolved dramatically, from a buried technical position within IT to one of the most strategically important roles in any organization. Yet, as **Ameet Jugnauth** observed, the position still “hasn’t quite found its place.” He reflected on the range of reporting lines he has encountered: CISOs reporting to COOs, CIOs, CROs, and even CFOs. Among these, he described the CFO relationship as “one of the most effective models,” offering both business alignment and accountability. The CFO’s operational view of the organization makes them an ideal counterpart to the CISO’s security mandate. However, empowerment doesn’t simply mean allocating larger budgets. As he emphasized: > “Empowering your CISO doesn’t mean giving them a blank cheque; it means helping them connect cybersecurity with the business agenda.” CFOs can use their influence to give CISOs a platform, ensuring security strategies are integrated into decision-making and framed in business terms rather than technical jargon. [AI in FP&A: What you need to knowAI in FP&A won’t make you or your role obsolete. But it will help automate routine tasks and give you more time for strategic initiatives.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-254.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles-4.png)](https://www.financealliance.io/ai-in-fp-a/) ## **From technical control to business enabler** The CFO’s role in cybersecurity is about enabling better decision-making, not micromanaging [technology](https://www.financealliance.io/driving-digital-transformation-in-finance/). One of the most impactful ways [finance leaders](https://www.financealliance.io/100-day-procurement-plan-for-finance-leaders/) can contribute is by asking a deceptively simple question: *What are we trying to protect?* Jugnauth explained that many CISOs present long lists of controls without linking them to business priorities. The CFO’s perspective helps ground those conversations in reality. > “What’s important in banking isn’t the same as what’s important in manufacturing or insurance. Each business is different, so the controls should be too.” The key is to view cybersecurity as a form of business risk, one that can be assessed, prioritized, and mitigated based on the organization’s objectives and risk appetite. **Aarti Ajay** added that finance leaders play a vital role in cultivating a culture of awareness and accountability: by fostering an understanding that cybersecurity is not just the responsibility of IT, but of everyone across the organization. ## **The CFO’s influence on the security agenda** CFOs, by virtue of their role, have significant influence over how security is perceived and prioritized. In most organizations, they work closely with CEOs and COOs, controlling the operational and financial levers that [drive strategic direction](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/). This gives them the power to ensure cybersecurity isn’t sidelined as a [compliance](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) function but embedded into business planning and [resource allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). As Jugnauth noted: > “In every organization I’ve worked in, it’s really the CFO that’s in charge; the CEO is often the outward face, but it’s the CFO who holds the strings to how things actually get done.” That influence can be used to help the CISO gain visibility, integrate security [metrics](https://www.financealliance.io/32-cfo-kpis/) into [financial reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/), and align cyber risk management with broader business goals. This collaboration also opens space for constructive challenge. CFOs should feel empowered to ask security leaders: - Why do we need this control? - What’s the return on risk reduction? - What are we protecting, and how much will it cost us if we fail to do so? These questions ensure cybersecurity programs are efficient, focused, and transparent. [How finance is evolving from reporting to innovationIs your finance team seen as a roadblock? Discover how to evolve finance from a cost center to a strategic driver of innovation and growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-255.png)Finance AllianceSiqi Chen![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--4.png)](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) ## **Cyber Risk Quantification: Turning risk into numbers** One of the most transformative tools bridging finance and cybersecurity is Cyber Risk Quantification (CRQ). Jugnauth described CRQ as a “contemporary discipline” that translates technical vulnerabilities into monetary impact, giving executives a clearer picture of risk exposure. The process involves modeling potential incidents and estimating their financial implications, much like capital risk modeling in [banking](https://www.financealliance.io/the-financial-revolution-how-open-banking-is-disrupting-the-status-quo/). By analyzing past data, external benchmarks, and organizational exposure, leaders can assign probable costs to different cyber events. For example, what a ransomware attack might cost in downtime, data loss, and reputational harm. “Instead of hearing, ‘This could be really bad,’” Jugnauth says, “the CFO hears, ‘If this happens, it will cost us a million pounds.’ That’s a language finance leaders understand.” Frameworks such as FAIR (Factor Analysis of Information Risk), developed by Jack Jones, Chairman of the FAIR Institute, have gained traction for structuring these assessments. They allow organizations to perform simulations (including [Monte Carlo modeling](https://www.financealliance.io/10-best-financial-modeling-tools/)) to calculate ranges of potential losses and assess where additional investment will have the greatest effect. Ajay emphasized that this quantitative approach helps bridge the gap between finance and security. It allows CFOs to make informed decisions about budget allocation while holding CISOs accountable for demonstrating measurable impact. [Profit planning: Why most fail & 7 steps to succeedThe hard truth is that most businesses aren’t profit planning properly or nearly enough. Many are stuck in their old ways using outdated strategies, overlooking critical factors, or worse, flying by the seat of their pants with no real plan at all.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-256.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/profit-planning-2.png)](https://www.financealliance.io/profit-planning/) ## **Primary vs. layered controls: The “domino effect” in defense** Effective cybersecurity relies on multiple layers of defense. Both experts highlighted that no single control can prevent every attack. Instead, organizations must create systems where, if one layer fails, another intercepts the threat. Jugnauth compared this to a domino rally: > “At some point, a domino is gonna fall over. But, if you can put the stopper in to prevent the chain reaction occurring, that's real cyber risk management.” Ajay noted that while layered controls are essential, organizations must also ensure their primary controls (those first lines of defense) are well established. Smaller organizations often over-rely on compensating or secondary measures due to limited resources, but over time, they must mature their foundational safeguards. From Jugnauth’s perspective, resilience is as much about response as prevention. “Prevention is better than cure,” he said, “but we all get sick. What matters is how quickly you recover.” That analogy captures the modern security posture: accepting that incidents are inevitable but focusing on rapid detection, containment, and recovery to minimize damage. ## **Adapting to technological change and risk appetite** As organizations transition from on-premises infrastructure to [cloud environments](https://www.financealliance.io/from-transactions-to-insights-the-role-of-cloud-powered-analytics-in-redefining-e-commerce-finance/), their risk appetites and control strategies shift. Jugnauth shared examples from his experience in banking: institutions with full control over on-prem systems often accepted a higher rate of incidents because they could respond swiftly. However, as they moved to the cloud (where control was more distributed) they needed stronger preventive measures and greater assurance from third-party providers. This dynamic underscores the CFO’s need to understand how technology transformation alters both risk exposure and cost structure. Cloud adoption, [automation](https://www.financealliance.io/fp-a-automation/), and digital integration all require continuous recalibration of cyber investments and insurance strategies. ## **The role and reality of cyber insurance** Cyber insurance has emerged as a critical yet complex risk mitigation mechanism. As Jugnauth explained, it is “an impact-reducing control,” designed to cushion financial losses rather than prevent incidents. Over time, the product has matured, with insurers becoming more discerning about what they underwrite. “It’s becoming a necessity rather than an option,” he said, “but it’s getting narrower, more specific to ransomware or malicious breaches.” However, he cautioned that obtaining coverage is far from straightforward. Companies that experience breaches often struggle to get reinsured, and remediation costs can be steep. > “The amount you spend to become insurable again is often higher than what it would have cost to fix your control environment in the first place.” Ajay added that insurance should never be treated as a replacement for governance and readiness: > “Controls are never perfect, but you need to build maturity, both in primary and layered defenses, so you can demonstrate that you’re managing risk responsibly.” Both agree that insurers increasingly expect evidence of structured control environments, incident response [planning](https://www.financealliance.io/driver-based-planning-forecasting/), and continuous monitoring before providing coverage. Without these, payouts may be denied, similar to a homeowner failing to lock their door before a break-in. ## **Incident preparedness: From detection to response** Managing cyber risk effectively means preparing for the inevitable. Both Ajay and Jugnauth stressed that cyber incidents are not a matter of *if* but *when*. What differentiates resilient organizations is their ability to detect and respond swiftly. Ajay pointed out that incident detection and response maturity are the true indicators of readiness. “It’s not about whether you were breached, it’s about how fast you detected it,” she said. Jugnauth echoed this, explaining that even with advanced preventive controls, “something will always get through.” Organizations should therefore focus on shortening the time between detection and containment, ensuring that a single compromise doesn’t escalate into a full-scale crisis. ## **Integrating cyber risk into financial and strategic planning** Digital transformation brings both opportunity and exposure. As organizations evolve, CFOs must ensure cyber risk management is woven into [financial and strategic planning](https://www.financealliance.io/17-finance-business-processes/), not treated as an afterthought. This includes engaging CISOs early in technology initiatives, assessing risk-adjusted return on investment, and maintaining flexibility in budgets to respond to emerging threats. Jugnauth recommends that CFOs “engage your CISO and ask: What are the consequences if we don’t do this?” Such dialogue forces alignment between financial decisions and operational risk tolerance. CRQ methodologies can support this by quantifying potential impacts and ensuring resources are allocated efficiently. Ajay adds that bridging [skills](https://www.financealliance.io/top-10-fp-a-skills-to-master/) gaps is essential to sustaining this integration. Both finance and technology professionals must understand each other’s disciplines, enabling [data-driven](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/), risk-aware collaboration that strengthens long-term resilience. ## **The CFO as a catalyst for cyber resilience** Cybersecurity today is inseparable from financial performance. In an environment where a cyber incident can disrupt operations, damage reputation, and erode shareholder confidence, CFOs are emerging as pivotal champions of resilience. By empowering CISOs, adopting risk quantification, and embedding security considerations into financial decision-making, CFOs can transform cybersecurity from a reactive safeguard into a proactive value driver. As **Ameet Jugnauth** summarized, cyber risk management is not about achieving perfection but about managing trade-offs intelligently. And as **Aarti Ajay** concluded, preparedness, not panic, defines the difference between vulnerability and resilience. Ultimately, the CFO’s role in cyber strategy is not optional. It is central to [sustaining trust](https://www.financealliance.io/fp-a-business-partner/), ensuring operational continuity, and securing the organization’s future in a world where digital risk and business risk are one and the same. --- *Insights from a conversation between Aarti Ajay, Director of Cyber Security and Audit Consultant at A2A Secure Edge Consulting and Ameet Jugnauth, Risk Director - Executive Risk Partner (Technology and Cyber Risk) at Swift, from the CFO Summit London.* *Find the full convo on demand with our* [*Pro*](https://www.financealliance.io/pro-membership/) *and* [*Pro+*](https://www.financealliance.io/pro-plus-membership/) *membership.* --- [Join our Slack community](https://www.financealliance.io/community/) for a space where you can connect with key leaders in the finance world, get answers to your pressing questions, get advice or inspired by success stories, and more. [Join the Finance Alliance Slack CommunitySign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today! Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-257.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Meta_Images_Slack-Community-1-6.jpg)](https://www.financealliance.io/community/) ### 4 hours to a board deck: How CFOs are using AI to transform financial presentations URL: https://www.financealliance.io/how-cfos-are-using-ai-to-transform-financial-presentations/ Last updated: 2025-11-17T10:35:33.000Z For CFOs, the quarterly [board presentation](https://www.financealliance.io/how-color-impacts-your-finance-presentations/) represents a significant operational and strategic [challenge](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/). Board meetings require clear communication of key metrics such as cash position, revenue [growth](https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/), and major investments. The process, which commences usually a few weeks before the close of a quarter, is typically characterized by an intensive, multi-week effort. It involves coordinating multiple team members—from analysts crunching data to controllers finalizing adjustments—often consuming over 40 collective hours. The CFO’s own time is frequently diverted from high-level strategy to the meticulous tasks of [data validation](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/), narrative construction, and slide formatting. The outcome of this traditional process is often suboptimal: a presentation dense with data but lacking a compelling strategic narrative. When financial results are presented as a series of formatted spreadsheets, the core insights—such as cash position, [revenue growth](https://www.financealliance.io/guide-to-company-growth/), and major investments—can become obscured. These inefficiencies can obscure critical insights needed for effective board meetings. This inefficiency carries a tangible cost, including delayed strategic decisions, missed opportunities to highlight [key performance drivers](https://www.financealliance.io/32-cfo-kpis/), and the frustration of leadership spending valuable time on administrative tasks rather than strategic analysis. AI is transforming the [CFO’s role](https://www.financealliance.io/how-to-become-a-fractional-cfo/) by automating routine tasks such as data analysis, report generation, and financial [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), thereby freeing up time for higher-value activities. ## TL;DR Traditional board deck preparation takes weeks and 40+ hours, often producing dense slides with little strategic clarity. [AI tools](https://www.financealliance.io/ai-in-fp-a/) can now enable CFOs to build board-ready decks in as little as four hours: - **Phase 0 (2 hr, one-time setup)**: Gather previous presentations and materials for identifying critical storylines from recent discussions and preferred presentation slides that are already high-grade. Train the AI with these materials in a secure project. - **Phase 1 (1 hr)**: AI generates executive summaries, risk insights, and scenario options, creating a clear strategic narrative. - **Phase 2 (2 hrs)**: Tactical review of content produced by AI with iteration as needed to refine the materials in a systematic improvement process. Share the outputs with key stakeholders for feedback and continue the refinement process. - **Phase 3 (1 hr)**: AI-powered platforms transform that narrative into polished, branded decks with professional visuals for final approval and human editing. The result: better more impactful slides, [stronger storytelling](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/), and discussions that focus on strategy. CFOs adopting this approach report faster prep cycles, higher board engagement, and more effective decision-making. [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/11/Screenshot-2025-11-04-at-10.07.56.png)](https://tirabassi.com/4-hours-to-a-board-deck-how-cfos-are-using-ai-to-transform-financial-presentations/) [Source](https://tirabassi.com/4-hours-to-a-board-deck-how-cfos-are-using-ai-to-transform-financial-presentations/) ## **What is an AI-powered finance function?** An [AI-powered](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) finance function represents a fundamental shift in how organizations manage and leverage financial data. By integrating advanced AI tools into daily operations, [finance leaders](https://www.financealliance.io/financial-leadership-in-changing-times-2/) can automate time-consuming tasks such as data entry, reconciliation, and routine reporting. This automation not only increases operational efficiency but also allows the finance team to redirect their efforts toward activities that drive long-term value. With AI handling the technical aspects of data processing, finance professionals gain more time to focus on strategic insight, [financial planning](https://www.financealliance.io/profit-planning/), and [risk management](https://www.financealliance.io/financial-crime-risk-management-fcrm/). AI-powered analytics can quickly surface [key metrics](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/), identify emerging trends, and provide scenario planning capabilities that support more informed, agile decision-making. This empowers finance leaders to deliver strategic guidance to the board and executive team, ensuring that financial operations are closely aligned with business objectives. Ultimately, an AI-powered finance function transforms the finance team from a back-office support role into a proactive business partner. By leveraging AI tools for everything from cash flow forecasting to risk assessment, organizations can enhance their financial discipline, improve [forecasting](https://www.financealliance.io/how-to-forecast-inventories/) accuracy, and respond more effectively to market dynamics. This modern approach positions the finance function as a critical driver of sustainable growth and competitive advantage. ## **The AI-augmented workflow** Emerging AI technologies now offer a [transformative approach](https://www.financealliance.io/exploring-the-transformative-power-of-ai-in-finance/), condensing a weeks-long process into a focused, four-hour workflow. By leveraging AI tools for narrative generation and platforms like Gamma and Canva for visual design, CFOs can elevate their presentations from routine reports to powerful strategic tools. Finance, as a core business function, is experiencing significant transformation through [AI integration](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/), resulting in improved efficiency and enhanced decision-making—while also enabling finance teams to stay ahead of industry trends. This workflow supports operational excellence by streamlining business processes and system implementation, and leverages operational expertise to drive strategic improvements and value creation. The following framework outlines this efficient, four-phase methodology: ### **Phase 0: Foundation and AI training (approx. 2 hours, one-time setup)** This critical preparatory phase establishes the foundation for AI-assisted board deck creation by training the system with institutional knowledge. ****Note:** This phase is typically a one-time investment. Once completed, future board decks can skip directly to Phase 1, enabling the true four-hour workflow. - **Historical material gathering**: Collect previous board presentations, quarterly reviews, and strategic planning materials from the past 2-4 quarters. Identify presentations that received particularly positive board feedback or generated productive strategic discussions. - **Storyline identification**: Review past board minutes and feedback to understand recurring themes, questions, and areas of focus. [Document](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) the critical narratives that have resonated with board members, such as market positioning, operational efficiency initiatives, or risk mitigation strategies. - **Secure project configuration**: Upload these high-grade materials into a secure AI project workspace (using platforms with enterprise-grade security like Claude Projects or ChatGPT Teams). Ensure proper [data governance](https://www.financealliance.io/finance-and-compliance/) protocols are followed to protect sensitive financial information. - **AI context setting**: Provide the AI with explicit instructions about company-specific terminology, preferred presentation formats, board composition and priorities, and any regulatory or industry-specific reporting requirements. Ensure the AI is trained on your company’s business model and recent financial data, such as the past week’s AR, to improve the relevance and accuracy of its outputs. **Result**: A well-trained AI system that understands your organization’s communication style, strategic priorities, and board expectations, creating a foundation for more relevant and contextually appropriate output. Once established, this foundation can be maintained with periodic updates rather than complete rebuilds, making subsequent board decks truly achievable in four hours or less. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-249.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-7.png)](https://www.financealliance.io/financial-charts-and-graphs/) ### **Phase 1: Strategic analysis and narrative development (approx. 1 hour)** This phase focuses on converting raw financial data into a coherent executive narrative. - **AI-assisted insight generation**: By inputting key financial tables and KPIs—such as customer acquisition costs, monthly recurring revenue, and leading indicators—into advanced language models like ChatGPT or Claude, CFOs can rapidly generate executive summaries, identify potential risks, and explore various narrative angles tailored to board priorities (e.g., growth acceleration, margin improvement, or liquidity management). - **Drafting the executive summary**: Instead of building slides sequentially, the process begins with a concise, one-to-two-page overview. AI can draft this summary to immediately highlight the most critical takeaways for executive decision-making. - **Scenario framing**: AI can efficiently outline alternative scenarios, allowing the [CFO](https://www.financealliance.io/top-10-cfo-skills/) to present strategic options clearly, whether concerning market expansion, risk mitigation, or capital allocation. This includes analyzing cash flow management and customer behavior patterns to inform strategic options. **Result**: A clearly defined strategic storyline and a set of focused talking points, ensuring alignment with the board’s informational needs. Crafting a compelling strategic story that connects financial results to broader business objectives helps engage board members more effectively. ### **Phase 2: Iterative refinement and stakeholder review (approx. 2 hours)** This phase ensures the [AI-generated content](https://www.financealliance.io/how-to-use-gemini-ai-with-google-sheets/) meets quality standards and aligns with stakeholder expectations through systematic improvement. - **Tactical content review**: Conduct a thorough evaluation of AI-generated narratives, checking for accuracy, relevance, and strategic alignment. Verify that all financial figures, including operational expenses, are correct and that the narrative addresses known board concerns, ensuring [operational](https://www.financealliance.io/operational-finance/) expenses are accurately modeled and relevant to the business context. - **Systematic iteration process**: Work through the content methodically, refining language, strengthening key messages, and ensuring logical flow. Use the AI as a collaborative partner, requesting alternative framings or additional analysis where needed. - **Stakeholder feedback loop**: Share draft narratives and key insights with department heads, the CEO, or other board presentation contributors. Incorporate their perspectives and domain expertise to enrich the strategic narrative. - **Quality assurance**: Validate that the content strikes the appropriate balance between detail and accessibility, ensuring complex financial concepts are explained clearly for board members with varying levels of financial expertise. **Result**: A refined, stakeholder-validated narrative that synthesizes multiple perspectives and is ready for visual transformation into presentation format. [Driving digital transformation in financeHow finance leaders can turn digital disruption into lasting competitive advantage.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-250.png)Finance AllianceJuan Ignacio Pascual![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--74--1.png)](https://www.financealliance.io/driving-digital-transformation-in-finance/) ### **Phase 3: Visual synthesis and presentation assembly (approx. 1 hour)** With the narrative established and refined, AI-driven design tools facilitate the rapid creation of a professional deck. - **Dynamic deck generation (e.g., Gamma)**: Platforms like Gamma use natural language input to generate logically flowing slide decks. The CFO provides the outlined narrative, and the tool structures it into a visually coherent presentation, eliminating manual formatting. - **Professional data visualization (e.g., Canva)**: Canva’s AI design tools can transform data sets into polished charts and infographics. These tools can be configured to adhere to company brand guidelines automatically, ensuring a consistent and professional appearance. A solid grasp of the technical aspects of data [visualization](https://www.financealliance.io/8-key-principles-of-data-visualization-in-finance/) and financial modeling is essential to maximize the value of these AI-driven tools. - **AI-powered slide creation**: Both platforms allow for the generation of entire slides from text prompts (e.g., “Create a slide comparing Q3 actuals to forecast, highlighting variance drivers”). - **Final human review and editing**: Conduct a final review to ensure visual consistency, verify that charts accurately represent the data, and make any necessary adjustments to layout or emphasis. **Result**: A board-ready presentation that is visually compelling, narratively consistent, and easily adaptable for future updates. ## **Managing AI hallucinations in financial reporting** [![Managing AI Hallucinations](https://i0.wp.com/tirabassi.com/wp-content/uploads/2025/10/c676148b-6c5a-4230-8cab-57b87c2f3e15.png?ssl=1)](https://tirabassi.com/4-hours-to-a-board-deck-how-cfos-are-using-ai-to-transform-financial-presentations/) [Source](https://tirabassi.com/4-hours-to-a-board-deck-how-cfos-are-using-ai-to-transform-financial-presentations/) One of the most critical risks when using AI for financial presentations is the phenomenon of “hallucinations”, instances where AI generates plausible-sounding but factually incorrect or fabricated information. In the context of board [reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/), where accuracy and credibility are paramount, even a single error can undermine trust and lead to flawed strategic decisions. Finance leaders must remain vigilant and implement rigorous safeguards to prevent AI-generated inaccuracies from reaching the boardroom. ### **Understanding AI hallucinations in finance** AI hallucinations occur when language models generate content that appears authoritative but lacks factual basis. In financial contexts, this might manifest as: - **Fabricated financial figures** or metrics that seem reasonable but don’t match actual data - **Invented trend explanations** that sound logical but misrepresent the true drivers of performance - **Fictional industry benchmarks** or competitive comparisons created to fill gaps in the AI’s training data - **Misattributed sources** or citations that don’t actually exist or don’t support the stated claim - **Spurious correlations** presented as causal relationships without proper analytical foundation ### **Prevention strategies** **1\. Never input raw data without context.** Always provide AI tools with clear, structured data accompanied by explicit labels and context. Ambiguous inputs increase the likelihood of misinterpretation and hallucination. **2\. Implement multi-layer verification.** Establish a systematic verification process where: - Every AI-generated financial figure is cross-referenced against source systems - All trend analyses are validated against actual historical data - Scenario projections are tested against established financial models - Industry comparisons are verified through authoritative sources **3\. Use AI as a draft generator, not a final authority.** Treat AI output as a sophisticated first draft that requires expert review. The CFO and finance team should view their role as editors and validators, not passive recipients of AI-generated content. **4\. Maintain source data traceability.** Keep clear documentation linking every statement in the presentation back to its underlying data source. This enables rapid verification and builds confidence in the presentation’s accuracy. **5\. Establish clear boundaries for AI use.** Define specific areas where AI assistance is appropriate (narrative framing, slide design, scenario exploration) and areas where human expertise is non-negotiable (final data validation, strategic recommendations, risk assessment). ### **Detection and correction protocols** **Red flags for potential hallucinations:** - Figures that seem unusually round or convenient - Explanations that feel generic rather than company-specific - Claims lacking clear attribution to source data - Narratives that contradict known business realities - Overly confident predictions without appropriate caveats **Correction workflow:** 1. **Immediate flagging**: Mark any suspicious content for verification 2. **Source validation**: Trace the claim back to original data 3. **Expert consultation**: Engage domain experts to validate technical claims 4. **Documentation**: Record the error and correction to improve future prompts 5. **Template refinement**: Update AI instructions to prevent similar issues ### **Building a culture of healthy skepticism** Successful [AI adoption](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) in finance requires fostering a team culture that combines enthusiasm for innovation with rigorous analytical discipline. Team members should be encouraged to: - Question AI outputs that seem too perfect or too convenient - Request source documentation for all material claims - Raise concerns about potential inaccuracies without fear of slowing the process - Celebrate the discovery of errors before they reach stakeholders - Continuously refine prompts and processes based on lessons learned By maintaining vigilance against hallucinations while leveraging AI’s efficiency gains, finance teams can achieve the best of both worlds: dramatically faster board deck preparation without compromising the [accuracy](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) and credibility that stakeholders demand. ## **Strategic applications for finance leadership** This streamlined workflow enhances reporting across key CFO [responsibilities](https://www.financealliance.io/what-does-a-finance-director-do/): - **Quarterly performance reviews**: Transforms KPIs into a strategic narrative on [performance](https://www.financealliance.io/flexible-budget-performance-report/) drivers, challenges, and forward-looking initiatives. - **Budget and forecast presentations**: Converts complex models into accessible charts and scenarios that clearly communicate strategic trade-offs. - **Risk and compliance reporting**: Reframes regulatory updates into board-ready insights, focusing on exposure, mitigation strategies, and required decisions. AI also streamlines audit preparation by improving data accuracy and facilitating compliance monitoring, helping organizations proactively address regulatory risks. - **M&A and capital allocation proposals**: Summarizes intricate deal models into concise, visually supported overviews to accelerate board understanding and confidence. AI-driven operational improvements in financial processes can lead to measurable [cost savings](https://www.financealliance.io/5-cost-reduction-strategies/) by increasing efficiency and reducing resource requirements. Ongoing support from financial partners or fractional CFOs is essential to sustain these benefits and ensure continuous strategic value creation. ## **Risk management strategies in AI-augmented board reporting** As finance leaders embrace AI-augmented board reporting, robust risk management becomes essential to safeguard the integrity and reliability of financial data. To ensure that board members can trust the insights presented, [finance teams](https://www.financealliance.io/fp-a-team-structure/) should implement comprehensive data validation protocols that catch errors or inconsistencies before they reach the boardroom. Regularly updating AI models to reflect evolving market dynamics is also critical, as outdated algorithms can lead to inaccurate financial forecasting and misinformed strategic decisions. Establishing clear guidelines for the use of AI in financial forecasting helps maintain consistency and transparency in board reporting. Finance teams should also conduct thorough sensitivity analyses, evaluating how different scenarios could impact financial performance. This proactive approach enables finance leaders to anticipate potential risks and present well-informed contingency plans, reinforcing the board’s confidence in the finance function’s ability to manage uncertainty. By integrating these risk management strategies, organizations can fully leverage AI’s benefits while upholding the highest standards of [financial reporting](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/). ## **A comparative view: Traditional vs. AI-augmented output** - **Traditional deck**: Often 40+ slides of dense data tables; inconsistent formatting; board discussion centers on clarifying figures rather than strategic debate. - **AI-augmented deck**: Typically 20+ slides built around a central narrative; clear visuals and consistent design; board dialogue focuses on strategic decisions, approvals, and risk assessment. CFOs adopting this approach report higher levels of board engagement, faster decision-making, and a significant reduction in follow-up data requests. The AI-augmented process enhances board meeting effectiveness by centering discussions on key insights and reinforcing operational discipline, ensuring that financial narratives drive informed, strategic outcomes. [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-251.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--4.png)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) ## **Integration costs and considerations** Integrating AI tools into financial operations requires careful planning and a clear understanding of both immediate and long-term costs. Beyond the initial investment in AI solutions, finance teams must account for ongoing maintenance, periodic updates, and the training required to ensure staff can effectively use new technologies. Compatibility with existing financial systems is another key consideration, as seamless integration is vital for maintaining efficient [financial planning](https://www.financealliance.io/10-big-picture-financial-planning-steps/) and reporting processes. Finance leaders should conduct a thorough cost-benefit analysis to determine whether the adoption of AI tools aligns with the organization’s strategic priorities and supports long term value creation. Scalability is also crucial—AI solutions should be able to grow with the business and adapt to changing operational needs. By evaluating these factors, finance teams can maximize the return on investment, minimize disruption, and ensure that AI integration strengthens the overall financial operations of the organization. ## **AI prompts and automation: Accelerating board deck creation** AI prompts and automation are revolutionizing the way finance teams create board decks, enabling faster, more insightful presentations. By automating the collection and analysis of financial data, AI tools help identify key metrics and generate executive-level narratives with minimal manual effort. This allows finance teams to focus on strategic decision making and financial storytelling, rather than getting bogged down in routine tasks. Effective use of AI prompts can streamline processes such as variance analysis, cash flow forecasting, and financial reporting, ensuring that board members receive timely, accurate, and actionable insights. Additionally, AI tools can seamlessly integrate operational metrics and industry benchmarks into board presentations, providing a comprehensive view of financial performance and competitive positioning. The result is a more efficient workflow that empowers finance teams to deliver high-impact board reporting with greater speed and clarity. [Guide to building stronger cross-functional relationshipsWant to know how finance can build stronger cross-functional relationships? Read this blog to learn more.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-252.png)Finance AllianceKavin Soni![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--75--1.png)](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/) ## **A phased implementation plan** A structured 90-day rollout is recommended for successful adoption: - **Weeks 1-2: Tool evaluation and team training**: Select the appropriate AI stack and conduct training sessions for the finance team on effective prompting and workflows. - **Weeks 3-8: pilot program**: Apply the new workflow to internal management or investor reports, with the option to extend the pilot to other business functions and portfolio companies to maximize impact. Use this period to gather feedback, refine templates, and standardize branding. - **Weeks 9-12: full integration**: Implement the four-hour workflow for the quarterly board deck. Track key metrics such as preparation time, board feedback, and the clarity of resulting action items. This phased approach enables organizations to build strategic foresight and adaptability into their financial reporting processes. ## **Common challenges and solutions in AI-driven financial presentations** While AI-driven financial presentations offer significant advantages, finance teams may encounter [challenges](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/) such as ensuring data accuracy, avoiding overly optimistic projections, and translating complex financial information for non-financial board members. To address these issues, finance leaders should implement rigorous data validation protocols and use sensitivity analyses to test the robustness of financial models and assumptions. Clear and concise storytelling is essential for conveying strategic insights and facilitating informed decision-making. By leveraging AI tools to build board slides that integrate both financial and operational metrics, finance teams can present a holistic view of business performance. This approach not only supports sustainable growth but also helps board members make strategic decisions with confidence. Proactive communication and ongoing refinement of AI-driven processes ensure that presentations remain accurate, relevant, and impactful. ## **Measuring impact** Success can be quantified through: - **Efficiency**: Target an 80% reduction in deck preparation time—from 40+ hours to just 4 hours. - **Engagement**: Measure a shift in board questioning from data clarification to strategic inquiry. - **Effectiveness**: Monitor the acceleration of key decisions and approvals, track progress toward growth targets, and assess enhancement of shareholder value. ## **Future of finance and AI-driven board presentations** The future of finance is being shaped by the rapid adoption of AI-driven board presentations, as finance leaders seek to enhance financial discipline, operational efficiency, and [strategic](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/) guidance. As AI tools continue to advance, finance teams will benefit from innovations in predictive analytics, automated financial modeling, and personalized board reporting—enabling more precise forecasting and deeper strategic insight. To stay ahead, finance professionals must develop expertise in strategic thinking, financial storytelling, and the effective use of AI tools for board reporting. By embracing these technologies, organizations can unlock new opportunities for business growth, improve the quality of decision-making, and build a foundation for long-term success. The integration of AI into the finance function is not just a technological upgrade—it represents a fundamental shift towards a more agile, data-driven, and strategically focused finance organization. ## **Conclusion** The responsibility of communicating with the board is among a CFO’s most critical functions. An effective presentation builds credibility, fosters trust, and accelerates corporate strategy. The integration of AI into this process is not about reducing quality, but about reallocating the CFO’s most scarce resource—time—from production to strategic [analysis](https://www.financealliance.io/the-variance-analysis-cycle/). By leveraging these tools, finance leaders can ensure their expertise is focused where it delivers the greatest value: shaping strategy and guiding the organization’s future. ## **FAQs** #### ****1\. How does AI reduce the time required to prepare quarterly board presentations for CFOs?** AI streamlines the board deck preparation by automating data analysis, narrative generation, and slide design. Tools like ChatGPT quickly produce executive summaries and scenario analyses, while platforms such as Gamma and Canva generate visually compelling slides. This integration condenses a process that traditionally takes weeks and over 40 hours into a focused four-hour workflow. #### ****2\. What are the key benefits of using AI-augmented workflows for financial presentations?** AI-augmented workflows enhance the clarity and strategic focus of financial presentations. They enable CFOs to shift from manual data compilation to delivering insightful narratives tied to business priorities. The result is higher board engagement, faster decision-making, reduced follow-up requests, and presentations that emphasize strategic guidance over raw data. #### ****3\. How can finance teams successfully adopt AI tools for board reporting?** Successful adoption involves a phased approach: evaluating and training on AI tools, piloting the workflow on internal reports, and then fully integrating the process for board presentations. This structured rollout helps teams refine templates, standardize branding, and track improvements in efficiency, engagement, and decision effectiveness. --- [**Sign up to our Pro+ membership**](https://www.financealliance.io/pro-plus-membership/) **to get exclusive content, access to our courses, a free ticket to our in-person Summit, and so much more.** [Finance Alliance Pro+ membershipBe one of the first to join Finance Alliance’s membership where you can access world-class finance resources and the all-in-one platform for networking and career advancement.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-253.png)Finance AllianceDev Team![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Membership_Meta_Images_-1.png)](https://www.financealliance.io/pro-plus-membership/) ### Top 20 FP&A skills to master (hard skills vs soft skills) URL: https://www.financealliance.io/top-10-fp-a-skills-to-master/ Last updated: 2026-01-28T16:42:59.000Z Financial planning and analysis (FP&A) is the [13th fastest-growing role](https://www.linkedin.com/pulse/linkedin-jobs-rise-2022-25-us-roles-growing-demand-linkedin-news/?ref=financealliance.io) in the United States and plays a critical part in driving profitable growth. Data analysis, budgeting, and forecasting are all top priorities for anyone in this role. The central objective, though, is using financial expertise to drive profitable business decisions. To do this properly, you *must* develop some key FP&A skills. So… what are they? Good question. There are quite a lot of them, and most can be broadly categorized into two main areas: hard skills and soft skills. Below, we’ve curated a list of the top 10 FP&A skills in each category that are required for success. ## **How technical and strategic skills shape your FP&A career** When you’re mapping out your [FP&A career](https://www.financealliance.io/fp-a-salary-and-career-path-guide/), it’s easy to focus on mastering technical skills, think variance analysis, data [modeling](https://www.financealliance.io/10-best-financial-modeling-tools/), and financial controls. These are the building blocks, the hygiene factors that let you deliver accurate numbers and reliable insights. But as you step up into [leadership](https://www.financealliance.io/financial-leadership-in-changing-times-2/), the game changes. Suddenly, it’s not just about what you can do with a spreadsheet. It’s about how you use your expertise to influence decisions, shape strategy, and drive business outcomes. According to Jon Yuregir, Head of Finance at EasyJet: > “So the technical side is obviously the hygiene factors in terms of understanding our variance analysis, making sure the governance and controls are in place so that we can trust our numbers, and the storytelling is elevating that and pitching it to non finance, stakeholders, in the c suite and in Exco.” That shift (from technical mastery to [strategic](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/) influence) defines the journey from analyst to manager to director. Early in your career, technical skills are your currency. You’re known for delivering great output and sharp analysis. As you move into management, your focus broadens: you’re now responsible for the quality and impact of your team’s work. And when you reach the C-suite, as Jon Yuregir explains: > “What actually is a judgment on your performance is whether you’re able to influence the course of the business.” So, why does this matter? Because both skill sets are essential. [Technical skills](https://www.financealliance.io/top-10-cfo-skills/) earn you credibility; strategic skills earn you a seat at the table. The best FP&A leaders blend both, using analytics to tell compelling stories, building trust with stakeholders, and guiding the business forward. If you’re aiming for leadership, start thinking about how you’ll develop not just your technical [toolkit](https://www.financealliance.io/fx-toolkit/), but also your ability to partner, influence, and lead. ## **10 hard FP&A skills** These hard skills are the technical competencies and knowledge needed to analyze data, [build financial models](https://www.financealliance.io/podcast/financial-forecast-model/), and translate complex information into actionable insights. ### **1\. Attention to detail** Reading data and spotting trends or patterns in that data requires some serious attention to detail. A single error can lead to chaos and inaccuracy in models, budgets and forecasts, which can negatively impact business decisions. That's why attention to detail is *so* important. It ensures: - **Reliable insights** \- Accurate data leads to sound financial analysis. - **Credibility** \- Consistent accuracy builds trust with [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/). - **Proactive problem-solving** \- Catching data issues early prevent bigger problems later. ****Skill development tip:** Implement a systematic review process. After completing a task, take a short break, then revisit the work with fresh eyes to check for errors and inconsistencies. Encourage peer review and if it helps, use checklists to make sure all the necessary steps and components are included **and* correct. ### **2\. Data storytelling** [80% of CFOs](https://www.accenture.com/%5Facnmedia/PDF-85/Accenture-CFO-Research-Global.pdf?ref=financealliance.io) agree that data storytelling is an essential skill for modern finance professionals. And, it’s not just about presenting data, you have to weave financial data into a compelling narrative with visuals like financial [graphs and charts](https://www.financealliance.io/financial-charts-and-graphs/). Remember - not *everyone* in the company understands finance the way you do. So, a huge part of your role as an FP&A professional is to be a *translator*. You bridge the gap between complex financial data and actionable insights for a wider audience - *this* is where data storytelling comes in. ****Fun fact:** Building dashboards and data visualizations is a skill considered essential by a staggering [73% of finance professionals](https://eweb.afponline.org/eweb/DynamicPage.aspx?WebCode=LoginRequired&expires=yes&Site=afp&URL%5FSuccess=https%3a%2f%2fwww.afponline.org%2fdocs%2fdefault-source%2fregistered%2f2020fpasurvey%5Ftechnologydataplatforms-final.pdf) when it comes to FP&A managers. ### **3\. Converting data into insights** Converting data into insights is a critical skill in FP&A because it transforms raw numbers into actionable intelligence. When people are faced with data alone, it can be overwhelming and extremely difficult to interpret. But, when FP&A can analyze and contextualize that data, they reveal patterns, trends, and potential anomalies that might have been missed. ****Skill development tip:** Focus on the "So What" factor. When analyzing data, ask yourself, "**What does this mean for the business?*" and "**What actions should be taken based on this data?*" Practice summarizing complex data into key takeaways and actionable recommendations. This approach will help you consistently translate raw data into meaningful insights. ### **4\. Tech-savvy** The most successful FP&A professionals tend to be very tech-savvy. This is an important FP&A skill because financial analysis relies on advanced software and tools to manage, analyze, and visualize data efficiently. Proficiency with tools like [Excel](https://www.financealliance.io/chatgpt-for-excel/), for example, allows for complex data modeling, advanced financial forecasting, and intricate data manipulation. According to the [Association for Finance Professionals](https://www.afponline.org/docs/default-source/registered/2020fpasurvey%5Ftechnologydataplatforms-final.pdf), 95% of finance pros say advanced spreadsheet skills are an **essential* skill for FP&A managers. It’s also worth getting familiar with enterprise resource planning (ERP) systems and specialized [FP&A software](https://www.financealliance.io/15-best-fp-a-tools-and-software/) to help: - Streamline processes - Automate routine tasks - Ensure accuracy in financial reporting You should also try to keep up with cutting-edge tech associated with AI and machine learning. For example, [GPT-4o](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/) (the latest version of OpenAI’s ChatGPT) is already changing how finance professionals work since it can create charts and graphs with your data and even analyze data sets. ![](https://media.tenor.com/JDV9WN1QC3kAAAAC/future-internet.gif) New technologies can be intimidating at first, but if you take the time to learn how to use them properly, they can benefit both you and your organization. ### **5\. Financial modeling and forecasting** If you want to succeed in FP&A, you need to be proficient in not only financial modeling, but also forecasting, [scenario planning, and sensitivity analysis](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/). Companies rely on the FP&A team to build accurate scenarios and forecasts that help them make smarter decisions. With a solid model, you can see how different situations, like a sales slump or an unexpected expense, might play out. This lets you create contingency plans and adapt quickly to changing circumstances. ![Skill-building tip](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/skill-building-tip-1.png) **Essential financial modeling techniques every FP&A pro should master** When you’re building your financial modeling toolkit, it’s not enough to just know the basics. You’ll want to get hands-on with a range of techniques that show up in real FP&A work, sometimes all in the same week. Here’s a quick guide to the core modeling approaches you’ll use most often: - **Three-statement modeling**: This is the backbone of FP&A modeling. You’ll link the income statement, balance sheet, and [cash flow](https://www.financealliance.io/3-cash-flow-forecasting-challenges/) statement so changes in one flow through the others. It’s essential for understanding the full financial impact of business decisions. - **Scenario analysis**: What happens if revenue drops 10%? Or if costs spike unexpectedly? Scenario modeling lets you test different assumptions and prepare for a range of outcomes. It’s how you help leadership see both risks and opportunities. - **Sensitivity analysis**: Sometimes, you need to know which variables really move the needle. Sensitivity analysis isolates [key drivers](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/), like price or volume, so you can see how small changes affect the bottom line. It’s a must for stress-testing plans. - **Driver-based modeling**: This technique focuses on the operational levers (like headcount, units sold, or customer churn) that actually drive financial results. It’s practical, actionable, and makes your forecasts more accurate and more credible with business partners. - **Variance analysis**: After the numbers come in, variance analysis helps you compare actuals to [forecasts](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), spot what went off-track, and explain why. It’s not just a reporting tool; it’s a learning tool for improving future models. Need help identifying key drivers in your company? Check out our ‘[***How to create a driver-based planning framework**](https://www.financealliance.io/driver-based-planning-forecasting/)’ guide for tips. ### **6\. Data analysis** By effectively analyzing data, you can identify trends, uncover patterns, and make informed decisions. This FP&A skill is crucial for creating accurate forecasts, [budgeting](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/), and strategic planning - all of which are vital for steering the company toward its financial goals. Here are some quick-fire tips to help you get better at data analysis: - **Use visualization tools** \- Excel, Power BI, and Tableau are excellent for [creating visual representations](https://www.financealliance.io/how-color-impacts-your-finance-presentations/) of your data, which might make it easier for you to spot patterns. - **Look for outliers** \- Outliers can indicate inconsistencies or errors in data. Use scatter plots to visualize and identify data points that fall significantly outside the normal range. - **Trend analysis** \- Perform moving average calculations to smooth out short-term fluctuations and highlight longer-term trends. - **Segmentation** \- Break down data into different segments (e.g., by product, region, or customer demographic) to identify trends and inconsistencies within specific areas. This can reveal insights that might be hidden in aggregated data. - **Benchmarking** \- Compare your data against industry benchmarks or historical performance to identify anomalies and trends. ### **7\. Budgeting** A well-crafted budget sets financial targets for every department, acting as a roadmap for the entire company. It helps everyone understand where the money's coming from and where it's going. As the year progresses, FP&A compares actual performance against the budget. This lets them identify areas that are exceeding expectations or falling short. This tracking allows for course correction and ensures the company stays on track to achieve its goals. ![](https://media.tenor.com/sVgFRUhATswAAAAC/we-are-massively-over-budget-rich-benoit.gif) **Don't be like this guy - budget wisely!* You might find it helpful to practice [zero-based budgeting](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/) (ZBB) to help build your budgeting skills. This method starts the budgeting process from a "zero base," analyzing every expense for each new period as if it were brand new, rather than simply adjusting previous budgets. ### **8\. Capital planning** Capital planning helps ensure that capital expenditures are aligned with the company's overall strategy, growth plans, and financial targets. By developing strong capital planning skills, FP&A professionals can support the creation of long-term shareholder value. However, this is a skill that you might not develop right away. In fact, you might find that the best way to get better at capital planning is on the job. By working closely with experienced FP&A professionals and participating in capital planning processes within the company, you can gain a lot of hands-on experience and practical knowledge. ### **9\. Reporting** One of the most important FP&A skills to help you thrive in your role is reporting skills. This is because FP&A professionals are often responsible for collecting, analyzing, and presenting financial data clearly and insightfully. This is key because accurate reports mean smarter decisions, happy regulators, and trust from everyone (including investors and lenders). Below is a quote from an episode of the *Two Cents: Finance Talk* podcast, where Brian Kalish shared an interesting analogy for financial reporting, and how modern FP&A professionals should approach it: ![Brian Kalish quote from Two Cents Finance Talk podcast](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/brian-kalish-quote-3.png) ### **10\. Variance analysis** [Variance analysis](https://www.financealliance.io/the-variance-analysis-cycle/) is the process of comparing actual financial performance to budgeted or planned figures to identify and understand the reasons for any differences. When you dive deep into why the actual numbers ended up different than what was planned, that's where you uncover truly valuable insights. Was it higher costs that threw things off? Weaker sales than projected? Understanding the root causes *behind* the variances is what separates great FP&A analysts from the rest. --- ### **Fast-track your FP&A skills with Pro+** With the [**Finance Alliance Pro+ membership**](https://www.financealliance.io/pro-plus-membership/), you’ll possess all the tools and knowledge needed to overcome any challenge and excel in your financial career - including exclusive **soft skills workshops** led by finance experts. You'll also enjoy: - Financial templates & frameworks - 100+ hours of OnDemand insights - Free in-person Summit ticket annually - Mentor program - Access all areas to virtual events - Exclusive articles ... and more **Sharpen your FP&A skills and take your career to the next level.** [Join Pro+ now](https://www.financealliance.io/pro-plus-membership/) --- ## **10 soft skills for FP&A** These skills enhance interpersonal interactions and are essential for effectively navigating the workplace. ### **1\. Ownership & accountability** Taking [ownership and accountability](https://www.financealliance.io/financial-accountability/) for your work is one of the most underestimated FP&A skills. You need to stand behind your analysis and recommendations, be ready to defend them when you need to, and take accountability for them. Doing this openly will help create a sense of trust and collaboration, breaking down those department silos that can slow things down. It also creates a safe space to take calculated risks and learn from mistakes, which ultimately leads to better results and a stronger FP&A function as a whole. With true ownership and accountability, FP&A isn't just seen as a support function, but as leadership's eyes and ears into the company’s financials. ### **2\. Business acumen** Do you understand how the business model(s) of your organization work? To do your job to the best of your ability, and to provide the most value possible, you must understand the various business models of the organization and how those models tie in with overall business strategies. The best FP&A professionals understand how all the [different parts of the business](https://www.financealliance.io/business-process-optimization/) fit together as a whole. So, take time to familiarize yourself with each of the different departments within the organization and learn how they all work together. And don’t stop there, you should also ensure you’re always up to date with your industry, including competitors, latest news, and market trends. Need some help building your business acumen skills? Here are a few ways you can improve: - **Step out of your silo** – too many FP&A teams are siloed away. You can often learn so much more about the business when you step out of your department and see how other parts of the business work. - **Pick the brains of department leaders** – the more you understand about how these people work (and their goals, challenges, etc.) the better equipped you are to provide tailored financial support. - **Get data directly from source systems** \- don't just take the data you receive at face value. Trace [operational metrics](https://www.financealliance.io/32-cfo-kpis/) *back* to their origin to develop a deeper understanding - knowing which data is noise versus signal is *huge*. ### **3\. Communication skills** Asking questions and listening objectively to others is a vital part of the FP&A role. Since you’re working with other people and often from different departments, polished communication skills are a *must*. Learning how to communicate effectively will help you to get better at presenting ideas to board members and delivering relevant insights in a way that people without a background in finance can understand. ### **4\. Collaboration** [Collaboration](https://www.financealliance.io/the-power-of-networking-case-study/) is a massively important part of the role because you’ve got to work with others not just in the finance department, but across the organization. Working effectively with others and being open to collaboration is key. You must be willing to learn from all areas and departments within the business because their insights could prove critical to your ability to assess risk, create accurate forecasts, and help leadership make vital business decisions. ****Collaboration tip:** Set up regular meetings with key stakeholders from different departments (e.g., sales, marketing, operations) to discuss financial performance, share insights, and align on strategic goals. ### **5\. Business partnering** If you have your eyes set on bigger things (and roles), you might want to focus your efforts on developing FP&A skills that will help you become a [strategic business partner](https://www.financealliance.io/finance-business-partnering-playbook-2/) to the company. If you’re in FP&A, it’s safe to assume you have the insights and foresight to guide strategic decisions. But unless you can translate complex financial data into actionable insights, work alongside different departments to navigate challenges and seize opportunities – you’ll be stuck in the backseat. ![Speak the language of the business](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/Speak-the-language-of-the-business.png) ### **6\. Strategic thinking** The way your mind works has a greater impact on your success as an FP&A professional than you might think. With [finance transformation](https://www.financealliance.io/your-guide-to-finance-transformation/) on the rise, there’s a good chance that many of the tedious and mundane tasks that take up your time will be automated. This is good news for finance professionals because it frees them from the burden of being tied to manual work and gives them more time to think critically and strategically. Your ability to think strategically will serve you well as you’ll find it a lot easier to spot trends and come up with solutions to help the business mitigate risk, budget appropriately, increase cash flow, etc. ![](https://media.tenor.com/FL-IW5lJv-sAAAAC/jim-carrey-idea.gif) ### **7\. Project management** FP&A teams often manage a variety of tasks simultaneously, from budgeting and forecasting to ad-hoc analyses. As you can imagine, having good project management skills comes in handy for FP&A pros because it helps them stay organized, prioritize tasks, and meet deadlines. To improve your project management skills in FP&A, you could start by breaking down large FP&A projects. This involves viewing large-scale FP&A initiatives, like budgeting or implementing a new financial system, as a series of smaller, manageable projects. This helps you to practice planning, resource allocation, and milestone tracking within the larger FP&A scope. ### **8\. Problem solving** Did you know that [68% of financial analysts](https://onestreamsoftware.com/resources/global-lp-cn-ar-hanover-research-financial-decision-makers-outlook-29oct2021/) consider problem-solving the most crucial skill for a finance leader? It’s perhaps not a surprise considering problem-solving is one of the most useful FP&A skills to have. Think about it - the finance data and reports themselves don't drive any value. It's the ability to analyze that information, identify issues and opportunities, and then develop strategies to course-correct or capitalize on them. *That's* where the real impact comes from. The problems FP&A tackles range from short-term fires like cash crunches and supply/demand imbalances, all the way up to big-swing strategic plays like [M&A](https://www.financealliance.io/m-a-best-practices/), new market entries, and funding major growth initiatives. Each situation requires creative problem-solving skills to stabilize issues, capitalize on opportunities, and ultimately drive better performance. ### **9\. Leadership** Leadership is important for FP&A professionals because it helps you spearhead new financial initiatives (like budget planning), influence key decisions, and inspire other team members to work together. If you want to develop your [leadership skills](https://www.financealliance.io/financial-leadership-in-changing-times-2/), you could try to: - Connect with experienced leaders within your company or industry to gain insights and advice on effective leadership practices. - Volunteer for leadership roles or projects that require cross-functional collaboration and strategic planning to gain hands-on experience. - Pursue leadership training programs, workshops, and courses to develop your leadership competencies and stay updated on best practices. Don't just support from the sidelines - step up and take ownership of driving important initiatives across the finish line. When you deliver successful outcomes, it helps to build serious credibility in the process. ### **10\. Adaptability** As an FP&A professional, you spend a lot of time forecasting, identifying possible scenarios, and deciding what action to take. However, you’ve also got to be highly adaptable. This means you must adapt to the changing needs of the business as and when they occur. Being proactive and recognizing that the company’s needs have evolved is a vital skill. It’ll not only help you to anticipate the evolving needs of the business, but it’ll also help you identify how you can better serve the company to bring as much value as possible. ## **Where soft skills drive real FP&A impact** If you’ve ever wondered what separates a good FP&A analyst from a truly impactful business partner, it comes down to more than just numbers. Communication, storytelling, and influence aren’t just nice-to-haves: they’re the engine behind effective business partnering. As [Jay Dyer](https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/), Head of FP&A, Global Tech & Ops at MetLife, puts it: > “FP&A is a relationship function. And I would argue that it's more of a relationship function than a data function. Because what is a budget? What is a forecast?... A budget is an agreement more than anything else.” Let’s bring this to life. Imagine you’ve just finished a quarterly [forecast](https://www.financealliance.io/how-ai-forecasting-drives-smarter-financial-planning/). The numbers look solid, but your real challenge is helping a division head understand what those numbers mean for their team and what actions they should take next. This is where your ability to translate financial data into a compelling narrative, tailored to your audience, becomes your superpower. You’re not just presenting figures; you’re [building trust](https://www.financealliance.io/fp-a-business-partner/), aligning [goals](https://www.financealliance.io/10-big-picture-financial-planning-steps/), and helping leaders make better decisions. Sufjan Hamid, Founder of The Finance Circle, highlights three essentials: a consulting mindset, communication and storytelling, and visibility. > “If you can’t communicate, you will not make sure that the people you are discussing with will do something about it... Storytelling is the human skills that we need to develop today to make sure our teams have this business partnering mindset.” So, if you’re aiming to move beyond number crunching, focus on building [relationships](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/), listening actively, and making your insights visible. The most effective FP&A professionals are those who can connect, influence, and inspire action, because that’s how you turn [analysis](https://www.financealliance.io/the-variance-analysis-cycle/) into real business impact. ## **FAQs:** What are FP&A skills? FP&A skills include financial modeling, data analysis, forecasting, budgeting, strategic planning, and proficiency with financial software and tools. Strong communication, problem-solving, and presentation abilities are also useful skills to have. What accounting knowledge is needed for FP&A? FP&A professionals need a solid understanding of financial statements, general ledgers, cost accounting, and financial reporting. Plus, understanding accounting rules (GAAP or IFRS) is key for getting the numbers right and staying on the legal side of things. What does it take to be a great FP&A analyst? To be a great FP&A analyst, you need to develop strong analytical skills, attention to detail, and the ability to interpret complex data. Some other areas that can help you improve in your role is proficiency in financial software, excellent communication skills, and a strategic mindset. What makes a great FP&A leader? A great FP&A leader combines deep financial expertise with strong leadership skills. They are adept at strategic thinking, effective communication, and team management. What role does emotional intelligence play in effective FP&A? High emotional intelligence helps FP&A professionals build stronger partnerships, have more collaborative/persuasive conversations, navigate organizational politics adeptly, and lead change management successfully. Why are negotiation skills useful for FP&A? From securing budgets to working through trade-offs during planning cycles, negotiation capabilities allow FP&A to advocate for optimal solutions while maintaining stakeholder alignment. What technology skills are becoming more vital for FP&A? Expertise in data visualization/BI tools, programming/scripting for automation and advanced modeling, cloud FP&A solutions, big data techniques, AI/machine learning for smart forecasting. ### 15 best FP&A tools and software URL: https://www.financealliance.io/15-best-fp-a-tools-and-software/ Last updated: 2025-11-12T11:16:21.000Z Want to choose the best **FP&A tools** for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs. We’ve carefully curated a list of the top FP&A software tools featured in our [Finance Tools of Choice report](https://www.financealliance.io/finance-alliance-tools-of-choice/), each scrutinized for its features, usability, and impact. So, whether you're a start-up on the brink of expansion or a well-established corporation refining its financial strategies, our guide aims to direct you to the FP&A solution that resonates with your business narrative. Read on to discover the best FP&A tools to empower your financial planning. **Table of contents** - - - - - - ### What is FP&A software? An FP&A tool is a software solution to optimize [financial planning](https://www.financealliance.io/10-big-picture-financial-planning-steps/), forecasting, and budgeting processes. FP&A software vendors often provide vital insights into financial performance, helping companies plan future actions, allocate resources efficiently, and make informed strategic decisions. These tools typically offer data visualization, [scenario modeling](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/), real-time analytics, and integration with other business systems, enabling a comprehensive view of a company's financial health. --- ## **What is the market size of FP&A software?** The global market size for FP&A software is experiencing steady growth, driven by increasing demand for more sophisticated financial analysis tools and the adoption of cloud-based solutions. The exact market size can vary based on different market research reports, but there's a consensus on its continuous expansion. For reference, the global financial management software market is expected to be valued at **$24.4 billion** by 2026, according to [Gartner's forecast](https://www.gartner.com/en/digital-markets/insights/software-market-insights-accounting-and-finance). This growth is fueled by factors like [digital transformation in finance](https://www.financealliance.io/state-of-finance-transformation-report-2022/), the need for more agile and accurate forecasting in a volatile business environment, and the growing complexity of financial operations in companies of all sizes. In 2023, the [Financial Planning Software market](https://www.linkedin.com/pulse/financial-planning-software-market-size-2023-share/) was predominantly led by cloud-based and on-premise product types, that together held the largest market share in this sector. [Excel’s game changing COPILOT function: Why my previous AI recommendations just changedLearn all about Excel’s new Copilot function - what it is, why it’s useful, and how you can apply it to your role in finance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-244.png)Finance AllianceSalvatore Tirabassi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--77-.png)](https://www.financealliance.io/excels-game-changing-copilot-function/) ## **What should I look for in FP&A software?** When selecting FP&A tools and software, consider the following key factors: - **Functionality:** Ensure the tool meets your specific financial planning, analysis, and reporting needs. Look for features like budgeting, forecasting, financial modeling, and scenario analysis. - **Integration:** The software should seamlessly integrate with your existing systems (like ERP, CRM, etc.) to ensure smooth data flow and unified operations. - **Usability:** User-friendly interface and ease of use are crucial for efficient operation and adoption by your team. - **Scalability:** Choose a tool that can grow with your business, accommodating increased data volume and more complex operations. - **Customization:** The ability to customize reports, dashboards, and models to fit your unique business requirements. - **Security:** Robust security features are essential to [protect sensitive financial data](https://www.financealliance.io/cfo-cybersecurity/). - **Support and training:** Look for vendors that offer reliable customer support and training resources to help your team make the most of the software. - **Cost-effectiveness:** Consider the total cost of ownership, including licensing, implementation, and maintenance fees, against the expected ROI. - **Compliance:** Ensure the tool complies with relevant financial regulations and reporting standards. - **Cloud vs. on-premise:** Decide whether a cloud-based solution (with its accessibility and lower upfront costs) or an on-premise solution (offering more control) is more suitable for your needs. ## **Best FP&A tools** ### **Abacum** [Abacum](https://www.abacum.ai/?utm%5Fsource=partner&utm%5Fmedium=google&utm%5Fcontent=finance%20alliance%20page&utm%5Fterm=fpa%20tools%20article%20finance%20alliance) is the AI-native FP&A platform that helps finance teams plan smarter, move faster, and make confident decisions. By embedding intelligence directly into core workflows, like data consolidation, forecasting, scenario planning and reporting, Abacum transforms financial planning from a manual, time-consuming process into a strategic advantage. ![Abacum](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/11/Screenshot-2025-11-12-at-11.15.18.png) [Source](https://www.abacum.ai/?utm%5Fsource=partner&utm%5Fmedium=google&utm%5Fcontent=finance%20alliance%20page&utm%5Fterm=fpa%20tools%20article%20finance%20alliance) ### **OneStream** This intelligent performance management platform, recognized for its integration of FP&A systems and processes, was highly appraised by our respondents for its ability to unify finance processes and streamline financial reporting. With [OneStream](https://www.onestream.com), you can plan and report faster by unifying finance processes to help deliver actionable financial signals, forecasts, and analytics across the enterprise. ### **SAP ERP** Efficiency in business operations is only as good as the integrative software supporting it. SAP ERP stands tall in this regard, offering end-to-end solutions for logistics, financials, and human resources. Renowned globally, it's an enterprise-centric solution that emphasizes process efficiency, data- driven insights, and scalable operations. Embracing [SAP ERP](https://www.onestream.com) translates to a synchronized business environment, where every function moves in harmony, powered by real-time data and analytics. You can also integrate this software with other products including SAP Analytics Cloud. ### **Anaplan** With its Connected Planning Platform, [Anaplan](https://www.anaplan.com) empowers businesses to develop robust financial forecasts in real-time. Its model-building capabilities, combined with granular data analysis, allow for in-depth scenario planning. The platform is designed to adapt quickly, helping finance teams respond proactively to ever-changing business conditions. ### **Planful** [Planful](https://planful.com) offers a continuous planning platform that merges financial forecasting, budgeting, and reporting, positioning it as a leading provider of FP&A solutions. Its cloud-based design ensures finance teams always have access to up-to-date data, enabling more agile and accurate forecasting. With its scenario modeling, businesses can better navigate uncertainties and stay ahead of market shifts. ### **Jedox** [Jedox](https://www.jedox.com/en/) provides an integrated solution for FP&A planning tools, encompassing planning, analytics, forecasting, and reporting. Its unified platform creates financial forecasts that are built on consistent and accurate data. Jedox is one of the most adaptable planning and performance management platforms available, allowing you to integrate data from any source, model any attribute, and create any set of business logic rules to create accurate financial forecasts for your business. ### **Sage Intacct** One of the most popular choices for financial reporting is [Sage Intacct](https://www.sage.com/en-us/sage-business-cloud/intacct/). Our participants noted its seamless integration with other tools, making it ideal for things like billing, general ledgers, cash management, order management, and of course, financial reporting. With its modular design, businesses can easily scale and adapt the software to their evolving needs. Its multidimensional data model allows for intricate financial analyses, making reporting more granular and insightful. ### **Oracle NetSuite** [Oracle NetSuite](https://www.netsuite.co.uk/portal/uk/home.shtml) offers seamless integration of accounting, financial planning, and complex reporting functionalities. Its intuitive interface, real-time data analytics, and customizable dashboards provide finance teams with the tools necessary to draw actionable insights, ensuring accurate and timely decision-making. As a part of Oracle's suite of products, NetSuite promises reliability, scalability, and a commitment to keeping pace with the ever-evolving demands of modern finance. [Top 15 must-have Chief Financial Officer skillsThe modern CFO wears many hats and must master a variety of CFO skills. But what skills does the CFO of the future need to stay on top of their game? Keep reading as we uncover some of the most important Chief Financial Officer skills…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-246.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--2--1.png)](https://www.financealliance.io/top-10-cfo-skills/) ## **Best FP&A software for startups** ### **Float** [Float](https://www.float.com/) is one of the best FP&A tools for startups, focusing on cash flow forecasting and management. Its user-friendly interface allows for easy tracking and forecasting of cash flow, giving startups a clear view of their financial health. The tool integrates with popular accounting software like QuickBooks and Xero, ensuring real-time financial data synchronization. Float's strength lies in its ability to provide straightforward yet detailed cash flow insights, which are crucial for startups managing their financial growth strategically. ### **Fathom** If you're looking for FP&A software for small businesses or startups, [Fathom](https://www.fathomhq.com/?keyword=fathom%20reporting&utm%5Fterm=fathom%20reporting&utm%5Fcampaign=HD-Fathom-Search-EMEA-Brand&utm%5Fsource=google&utm%5Fmedium=cpc&hsa%5Facc=6194521446&hsa%5Fcam=16142393697&hsa%5Fgrp=131796250023&hsa%5Fad=590280843065&hsa%5Fsrc=g&hsa%5Ftgt=kwd-742581039066&hsa%5Fkw=fathom%20reporting&hsa%5Fmt=e&hsa%5Fnet=adwords&hsa%5Fver=3&gad%5Fsource=1&gclid=CjwKCAiAjfyqBhAsEiwA-UdzJDMHf4nQ3OoeT1EVxLoAx-GAEp4YrwMHTrl5p5Yev2%5FsyfYtowtZXRoCLP0QAvD%5FBwE) is an excellent choice. It's an intuitive and comprehensive financial analysis and reporting tool. It offers an array of features like profitability analysis, trend tracking, and KPI monitoring. Fathom stands out for its ability to translate complex financial data into visual reports and dashboards, making it easier for startups to make data-driven decisions. Its seamless integration with accounting software simplifies the process of financial reporting, ideal for startups needing to maintain focus on their core business activities. ### **Spotlight Reporting** [Spotlight Reporting](https://www.spotlightreporting.com/) is tailored for startups that require versatile financial planning and analysis software for reporting, forecasting, and budgeting. The platform offers in-depth financial reports, full-spectrum forecasting, and interactive dashboards, making it a comprehensive solution for startups aiming to keep a close eye on their financial performance. One of its key features is the ability to create custom reports, which can be tailored to a startup’s specific needs, allowing for more focused financial insights and strategic planning. [AI in FP&A: What you need to knowAI in FP&A won’t make you or your role obsolete. But it will help automate routine tasks and give you more time for strategic initiatives.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-247.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles-3.png)](https://www.financealliance.io/ai-in-fp-a/) ## **Best FP&A AI tools** ### **Microsoft Dynamics** Diving deep into business analytics and insights becomes seamless with [Microsoft Dynamics](https://www.netsuite.co.uk/portal/uk/home.shtml). More than just an ERP, it integrates CRM capabilities with multi-currency financial management, supply chain, and analytics modules. Its strength lies in the deep integration with other Microsoft tools and a cloud-centric approach, catering to businesses aiming for agility, foresight, and integrative growth. For finance, Microsoft Dynamics allows you to adopt faster to avoid disruptions, work smarter, and drive better performance with automation. ### **OpenAI ChatGPT** OpenAI's ChatGPT has proved to be one of the best FP&A AI tools. Beyond just answering queries, it can assist in data extraction, summarizing financial reports, and providing insights into data and complex financial terminologies. With [ChatGPT](https://www.financealliance.io/how-to-use-chatgpt-with-python/), finance teams can streamline communications, get instant clarifications on financial matters, and even enhance customer-facing interactions, offering real-time responses to financial queries. ### **Microsoft Copilot** Finance isn't just about numbers; it's about making informed decisions based on those numbers. [Microsoft Copilot](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) combines the power of large language models (LLMs) with your data and is designed to alleviate the burden of mundane tasks, enabling users to focus on more fulfilling and creative aspects of their work. This tool can be integrated seamlessly into Microsoft applications such as Word, Excel, PowerPoint, Outlook, and Teams. ### **Domo** [Domo](https://www.domo.com/) stands out as a business intelligence tool that amplifies the power of data across an organization. It promises to help you move from basic charts and graphs to data experiences that fuel real insights and action when it matters most. With intuitive dashboards and robust integration capabilities, Domo ensures that professionals from various departments, including finance, can seamlessly connect and interpret vast datasets. As a result, businesses can harness the potential of their data, identify trends, and optimize strategies for growth. --- ## Common FAQs: FP&A tools #### ****What is FP&A technology?** FP&A technology refers to the software and tools used in financial planning and analysis. These technologies automate and streamline various FP&A processes, such as budgeting, forecasting, reporting, and financial modeling. They often incorporate data analytics, visualization tools, and integration capabilities, enabling FP&A teams to derive insightful, data-driven decisions efficiently. ### #### ****How big is the FP&A software market?** The FP&A software market is experiencing significant growth, driven by an increasing demand for sophisticated financial planning tools and cloud-based solutions. The exact market size can vary according to different market research reports, but the consensus is on its continuous expansion, reflecting the rising importance of agile and accurate financial planning in diverse business environments. ### #### ****What does FP&A software do?** FP&A software facilitates a range of financial planning and analysis activities for businesses. Key functions include: - ****Budgeting and forecasting**: Assisting in the creation of detailed budgets and financial forecasts. - ****Financial reporting**: Generating comprehensive financial reports for internal and external stakeholders. - ****Data analysis and visualization**: Providing insights through data analysis and presenting them in an easily understandable format. - ****Scenario planning**: Allowing companies to evaluate different financial scenarios and their potential impacts. - ****Integration with other systems**: Seamlessly connecting with other business systems (like ERP and CRM) for real-time data synchronization and holistic analysis. - ****Automating routine tasks**: Reducing manual efforts in data entry and calculations, thereby increasing efficiency and accuracy. --- ### **Download our Finance Tools of Choice Report** The right FP&A tool is pivotal for your business’s financial health and growth. Whether you're a startup navigating the complexities of financial planning or an established enterprise looking to refine your strategies, the right FP&A software can make all the difference. However, with so many options available, the decision-making process can be overwhelming. That's why we've compiled a comprehensive [Finance Tools of Choice](https://www.financealliance.io/finance-alliance-tools-of-choice/) report. By downloading our report, you'll gain access to an invaluable resource that breaks down the strengths and capabilities of various finance tools, tailored to meet different business needs and scales. Let this report be your guide in selecting a tool that not only aligns with your business objectives but also empowers your financial planning and analysis processes. ### How much should you really be earning? URL: https://www.financealliance.io/how-much-should-you-be-earning/ Last updated: 2026-08-12T11:48:15.000Z In the world of finance, where precision and performance go hand in hand, what you earn often depends on much more than your skill set. It’s about timing, geography, experience and, increasingly, job title. The [**Finance Alliance Salary Survey**](https://www.financealliance.io/finance-salary-report/)sheds light on just how dramatically compensation can vary between roles and regions, revealing a global pay landscape defined by opportunity for some and inequality for others. [Finance Alliance Salary Report 2025Uncover the truth about what your finance peers are earning and see how your salary measures up with the Finance Alliance Salary Report 2025! 💵![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-241.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Salary_Survey_2025_Meta-1.png)](https://www.financealliance.io/finance-salary-report/) ## **A global benchmark with stark contrasts** The [survey](https://www.financealliance.io/finance-alliance-salary-survey/) found that the **average total compensation for finance professionals worldwide sits at $139,771**, which includes both salary and bonuses. On paper, this figure looks healthy, but averages can be deceiving. The underlying regional data exposes a sharp divide between markets, one that underscores the shifting dynamics of global [finance talent](https://www.financealliance.io/top-10-cfo-skills/). **North America leads the way**, with finance professionals earning an average total of **$204,729**, far surpassing the global average. **Europe follows at $115,488**, and **Asia trails significantly at $43,472**. These gaps reflect not only differing costs of living but also the relative maturity of financial roles within each region. In countries where finance functions are deeply embedded into corporate structures (like the United States and the UK) salaries tend to be far higher than in developing economies, where financial management may still be seen as an operational rather than [strategic function](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/). When bonuses are isolated from base pay, the imbalance becomes even clearer. European finance professionals enjoy the highest average bonuses at around **$25,000**, compared with just under **$4,000** in North America. The numbers suggest that while European firms may not always lead on base salary, they reward [performance](https://www.financealliance.io/financial-charts-and-graphs/) and profit-sharing more generously, an interesting reflection of differing compensation philosophies between regions. ## **The power of title: Who earns the most** Beyond geography, [job title](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) remains one of the most significant determinants of pay. At the top of the ladder sits the **CFO**, commanding the highest average base salaries across the board. But even among CFOs, geography matters. According to the report, [CFOs](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/) in **North America** earn an average base of **$258,167**, while their counterparts in **Europe** average **$133,700**. In the **Middle East**, CFOs take home around **$105,000**, less than half the North American figure. The story is similar across other senior roles. **Finance Directors** in Europe make an average of **$158,750**, whereas those in Asia report **$150,000**. The gap widens dramatically at the mid-management level. **Finance Managers**, for example, earn **$144,000** in North America but just **$17,962** in Asia, a staggering fourteenfold difference for the same title. The data tells a clear story: **title alone doesn’t dictate worth, context does**. A Finance Manager in Toronto or London may oversee sophisticated systems, complex forecasting models, and large [teams](https://www.financealliance.io/how-fp-a-teams-build-budgets-and-how-you-can-nail-this-in-interviews/), whereas the same title in a smaller Asian firm might encompass a much narrower remit. Job scope, company size, and industry maturity all play defining roles in setting compensation levels. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/Screenshot-2025-10-27-at-10.50.58.png) ## **Geography matters** If there’s one takeaway from the 2025 data, it’s that location continues to wield enormous influence over pay. This is not just about cost of living, it’s about the economic structure surrounding finance itself. In **North America**, finance roles have become increasingly specialized, strategic, and integrated into [decision-making](https://www.financealliance.io/17-finance-business-processes/). CFOs are no longer just number crunchers; they are business partners and growth architects. The same is true, to a slightly lesser extent, in **Western Europe**, where financial [leadership](https://www.financealliance.io/financial-leadership-in-changing-times-2/) has evolved to include performance management and investor relations. By contrast, in **Asia and parts of Latin America**, finance departments in smaller firms often remain focused on reporting and compliance rather than strategic planning. As a result, even senior finance professionals in these markets tend to earn less, despite having similar qualifications or experience levels. However, this gap may narrow in coming years. Our report hints at a growing appetite for strategic finance capabilities in emerging markets, a sign that salaries could climb as these regions begin to prioritize finance as a driver of [long-term growth](https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/) rather than a back-office function. ## **The rise of the finance business partner** One of the most intriguing findings in this year’s report is the **emergence of the Finance Business Partner as one of the highest-paid roles in the field**. In North America, these professionals are earning an average of **$242,500**, rivalling even CFO salaries in other parts of the world. This shift marks a turning point for the finance profession. Traditional titles like Financial Controller or Accounting Manager, while still critical, are giving way to roles that emphasize commercial acumen and [cross-functional collaboration](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/). Finance Business Partners are now at the center of decision-making, translating data into strategy and ensuring that every business decision is underpinned by sound financial logic. The premium on these roles underscores a broader transformation in how companies perceive finance. It’s no longer enough to report on what has happened; organizations increasingly need people who can explain why it happened and what should happen next. [Top finance events to attend 2026 | Finance Alliance2026 is set to be an exciting year with a range of finance events taking place around the world that offer opportunities to learn, network, and grow.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-243.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Summit_Website_Article_Images_OnDemand-3.png)](https://www.financealliance.io/top-finance-events/) ## **The human side of the numbers** While the data paints a clear picture of pay disparities, it also raises deeper questions about fairness and satisfaction. Our report’s later sections reveal that **nearly half of finance professionals don’t believe their compensation reflects their true value**. That disconnect is even more striking when you consider the size of the paychecks being discussed. High earnings don’t always equate to happiness or perceived fairness, a tension that continues to shape career decisions across the industry. This perception gap may stem from a lack of transparency. Many respondents noted that their companies don’t clearly define the criteria for pay increases or promotions. In a profession built on clarity and [accountability](https://www.financealliance.io/financial-accountability/), this ambiguity can be particularly frustrating. For employers, this should serve as a warning. As the war for finance talent intensifies (especially for roles requiring hybrid technical and strategic skills) unclear pay structures risk driving high performers elsewhere. ## **Knowing your worth** For finance professionals navigating their next career move, the 2025 data offers both a benchmark and a roadmap. It confirms that **leadership, specialization, and location** remain the strongest predictors of compensation. Those willing to invest in advanced skills (particularly in analytics, financial modeling, and business strategy) stand to earn significantly more, especially if they’re open to relocation. For organizations, the findings underscore the need to think globally when benchmarking salaries. In an increasingly borderless talent market, professionals in Mumbai or Madrid can now compete for roles once confined to New York or London. Offering [competitive](https://www.financealliance.io/navigating-uncertainty-why-agile-fp-a-is-your-competitive-edge/), transparent, and fair pay packages is both good ethics and a competitive necessity. ## **The bottom line** Our [**Finance Alliance Salary Survey 2025**](https://www.financealliance.io/finance-salary-report/) makes one thing abundantly clear: the value of a finance role depends as much on where you are as on what you do. Geography and job title intersect to create enormous variations in compensation, sometimes by hundreds of thousands of dollars a year. Yet beneath those figures lies a deeper truth: that finance, as a profession, is evolving faster than ever. Titles that once carried prestige are being redefined by technology, globalization, and a growing emphasis on strategic insight. --- **We're currently building the new edition of the** [**Finance Alliance Salary Survey**](https://www.financealliance.io/finance-alliance-salary-survey/) **and need your input.** **Join the decision-makers and finance leaders already submitting their insights and contribute to one of the largest reports in the industry.** [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-242.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1-1.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### What we’ll lose if we let AI take over financial planning (a cautionary tale) URL: https://www.financealliance.io/ai-in-finance-balancing-efficiency-with-human-insight/ Last updated: 2025-10-24T07:00:53.000Z I’ve had a really funky career so far. That’s honestly the best way I can describe it. I’ve led [financial planning and analysis (FP&A)](https://www.financealliance.io/11-must-read-fp-a-books/) groups at a number of companies: Raytheon, United Technologies when it was still separate, and now MetLife. But I’ve also found myself in roles that, on paper, seem completely out of place for a finance guy. I once ran a shop floor at Northwest Airlines. I redesigned the executive incentive system and [metrics](https://www.financealliance.io/32-cfo-kpis/) at Raytheon. I’ve worked in operations, in [HR-related functions](https://www.financealliance.io/finance-and-hr-can-they-peacefully-coexist/), and in strategy roles. At first glance, those experiences don’t seem connected. But looking back, they all gave me a chance to see how different parts of a company operate, and more importantly, how they connect. It’s given me a perspective that I think more FP&A professionals should cultivate. Because when we only live in our own FP&A bubble, when we only talk to finance people, our perspective narrows. But when we open ourselves up to what others in the organization are thinking (operations, HR, sales, engineering) it changes how we approach our work entirely. That’s what I want to talk about: how our profession is evolving, what we stand to gain from [technology like AI](https://www.financealliance.io/fintech-and-ai/), and what we could lose if we’re not careful. [AI in FP&A: What you need to knowAI in FP&A won’t make you or your role obsolete. But it will help automate routine tasks and give you more time for strategic initiatives.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-237.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles-1.png)](https://www.financealliance.io/ai-in-fp-a/) ## **Why financial planning matters more than ever** Whenever I speak to groups about [financial planning](https://www.financealliance.io/10-big-picture-financial-planning-steps/), I like to ask a simple question: Why are we important?It’s not a trick question, but the answers are always telling. People will say, “Because we’re future-focused” or “We help the company make better decisions”, which is all true. Others might add, “We’re the liaison between departments and finance.” Again, absolutely true. [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) connects the dots between departments that might not otherwise talk to each other. But after all these years, I’ve come to see FP&A as much more than a data function. Yes, we have data responsibilities (GAAP compliance, MD&A writing, [performance measurement](https://www.financealliance.io/financial-charts-and-graphs/), providing data for decisions). We help our business partners stay out of regulatory trouble by saying, “No, you can’t do that, do this instead.” We’re the keepers of the historical record. When someone asks, “How did we handle this four years ago?”, we have the answer. But beyond all that, **FP&A is fundamentally a** [**relationship function**](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/)**.** Think about it: what is a [budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), really? It’s not just numbers. It’s an agreement, a shared set of expectations between a division head and a CFO. It says, “I will perform at this level this year, and you will reward me for it.” That’s not accounting; that’s relationship management. It’s negotiation, [alignment](https://www.financealliance.io/6-steps-to-transform-fp-a-into-a-platform-for-strategic-alignment/), and trust. In that sense, FP&A reports the past but also facilitates a shared vision of the future. ## **The human core of our work** In every organization I’ve been part of, FP&A has been the connective tissue. We’re the people who talk to everyone: the engineers building the product, the HR teams developing talent, the operations folks solving supply chain issues, the [CFO](https://www.financealliance.io/top-10-cfo-skills/) who needs a clear picture of it all. We’re the translators between strategy and measurement, between the vision of where the company wants to go and the metrics that tell us whether we’re on track. When I was a senior financial analyst, my division head once said, “You’re not sitting in that finance office, you’re sitting right next to me.” She wanted me within arm’s reach, because she wanted to bounce ideas off me in real time. She knew that my role wasn’t just to report numbers, but to also interpret, advise, and translate. That’s why I often tell my teams: FP&A is a relationship business disguised as a [data business](https://www.financealliance.io/mastering-data-storytelling/). ## **The coming disruption of AI** Now, let’s talk about AI. There’s no denying the promise it brings: efficiency, [cost savings](https://www.financealliance.io/5-cost-reduction-strategies/), speed. I’ve seen senior leaders (very smart, capable people) light up at the thought of [automating huge chunks of the FP&A process](https://www.financealliance.io/fp-a-automation/). I’ve even seen one former boss practically drool at the idea of wiping out an entire department with a click. And sure, AI can save us time. It can handle repetitive data tasks and process mountains of information faster than we ever could. But here’s the question that keeps me up at night: **What are we going to lose when we gain those cost savings?** There’s a quote from the National Institute of Health that I often share: > *“Human closeness will gradually diminish as AI replaces the need for people to meet face to face for idea exchange. AI will stand between people as personal gatherings will no longer be needed for communication.”* That one stopped me cold. Because if you think about what we do in FP&A (crossing organizational boundaries, connecting departments, [building trust](https://www.financealliance.io/fp-a-business-partner/)) those human interactions are everything. If we start letting AI sit between us, what happens to those relationships? ## **Three things we can’t afford to lose** When we rush to implement [AI in finance](https://www.financealliance.io/ai-in-fp-a/), there are three things we risk losing if we’re not thoughtful. ### **1\. Enterprise alignment** One of the biggest frustrations CEOs express is misalignment: people across the company pulling in different directions, not fully understanding where the organization is headed or how their work contributes to that [strategy](https://www.financealliance.io/10-structured-capital-strategies/). FP&A has always played a central role in fixing that. We take the corporate strategy and translate it into measurable objectives. We track progress. We [communicate](https://www.financealliance.io/stakeholder-communication-plan/) across silos. AI can crunch numbers, but it can’t align people. It can’t sense when a department is moving in the wrong direction or when a conversation is needed to bring two teams back on track. [Alignment](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/) is human work. ### **2\. Business network connectivity** Because FP&A crosses so many boundaries, we often connect areas that don’t naturally talk to each other. We’re the glue. We hear something from [operations](https://www.financealliance.io/operational-finance/) that might solve a problem in marketing. We surface insights that product and HR both need to hear. AI doesn’t have lunch with colleagues. It doesn’t overhear an offhand comment that sparks a new idea. It doesn’t broker trust between [leaders](https://www.financealliance.io/10-cfo-personality-traits/). Those informal connections are where some of the most valuable work gets done. ### **3\. Career development and succession planning** This is the one that really worries me. Just under half of Fortune 100 CEOs were at least division CFOs at some point. Many of them started in roles that, on the surface, looked like “data cruncher” jobs in FP&A. But those jobs were training grounds: they taught them how the business really works, who the key players are, how to think strategically, and how to [communicate](https://www.financealliance.io/cfos-role-in-investor-communications/) across departments. If we automate away those roles entirely, where will the next generation of financial leaders come from? Where will they learn to see the organization as an interconnected system rather than a collection of [reports](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/)? We can’t afford to lose that pipeline. [Transforming from accounting to FP&A business partneringThinking of moving from accounting to FP&A? Discover the five strategies that are going to help you make the transition into the world of FP&A from Global Finance & Strategy leader (and FP&A expert), Dr. Mohamed El Rouby.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-239.png)Finance AllianceMohamed El Rouby![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--30-.png)](https://www.financealliance.io/transforming-from-accounting-to-fp-a-business-partnering/) ## **Lessons I learned about the power of connection** One of the most formative experiences of my career came when I worked at Raytheon. There, I led the company’s flagship executive development program, which we ran in partnership with Dr. Ron Burt from the University of Chicago. Ron taught a concept called **social capital**: the value people derive not from their individual skills, but from being connected within an organization. In other words, ; social capital is what you gain from who you know and how you connect those people. We all understand formal [relationships](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/), such as the org chart and who reports to whom. But here’s the thing: formal relationships mostly define who’s to blame when something goes wrong. Informal relationships (the ones you build through trust and conversation) are where work actually gets done. Ron’s research quantified that idea. He studied networks across multiple organizations, asking people: “Who are the most important people for you to get your job done?” Then he analyzed those [networks](https://www.financealliance.io/11-networking-in-finance-tips/) mathematically. What he found was eye-opening. People whose [networks](https://www.financealliance.io/community/) were open and brokered (meaning they connected across groups that didn’t usually interact) were significantly more successful. They were promoted faster, rewarded more often, and recognized as higher performers. In fact, across six companies, people with brokered networks earned promotions and raises at rates 1.5 standard deviations higher than those in closed, insular networks. Why? Because they were exposed to more ideas. They had access to more perspectives. They were the ones connecting dots others couldn’t see. That research stuck with me, and I’ve seen it play out time and again. Raytheon in the early 2000s was, to put it mildly, an interesting place. The company had just merged multiple organizations (pieces of Hewlett Packard, Texas Instruments, and others that had been fierce competitors for decades). They didn’t just ignore each other, they hated each other. And now they were expected to work together. The result was predictable. Each division could deliver an incredible component, what we called a “black box.” But customers didn’t want five black boxes, they wanted solutions. They’d say, “We’re paying you to solve our problem, not to sell us parts.” So our team would go into these divisions, survey employees about who they worked with, and map out their internal networks. We could literally see where the connections existed and where they didn’t. Then we’d visualize those networks. The dots were people; the lines were their relationships. When we removed the “super-connectors” (those brokers who bridged gaps) the entire network would often collapse. That’s how fragile [collaboration](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) was. But when we brought people from different clusters together to see the map, something amazing happened. They realized their so-called “impossible problems” already had solutions sitting in another division, waiting to be discovered. Those sessions would end with teams saying, “We know exactly what to do now.” The solution was there all along, they just weren’t talking to each other. That experience taught me that connectivity isn’t just a nice-to-have, it’s the foundation of organizational success. And FP&A sits right in the middle of that web. [Why human skills are the future of financeAs AI transforms finance, it’s not just about tech, it’s about people. Discover why emotional intelligence, curiosity, and leadership are the real future skills that will set you apart.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-240.png)Finance AllianceDaniele Martins![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--61--1.png)](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) ## **What the data says about networks and rewards** The other fascinating insight from Ron Burt’s work was how measurable this effect is. He created a concept called constraint, which measures how open or closed your network is. It runs on a scale from 0 to 100\. A low score means your contacts don’t all know each other and you bridge across groups. A high score means your network is tight; everyone you know knows everyone else. When he correlated people’s constraint scores with their compensation data, he found that those with more open, brokered networks (lower constraint) were consistently rewarded more. They got promoted earlier, earned higher raises, and achieved faster career growth. Even after stripping out variables like education, [gender](https://www.financealliance.io/how-great-organizations-fuel-innovation-through-esg-and-diversity/), geography, and tenure, the pattern held true. In other words: the people who crossed boundaries and built connections were the ones who advanced. That’s something AI can’t replicate. It can’t build informal trust networks or broker relationships across silos. Those skills will only become more valuable as [automation](https://www.financealliance.io/driving-digital-transformation-in-finance/) spreads. ## **The path forward: Being smart about AI** Let me be clear, I’m not anti-AI. Far from it. I love what it promises to do for our profession. It can [eliminate repetitive manual work](https://www.financealliance.io/excels-game-changing-copilot-function/), accelerate [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), and free us to focus on higher-value analysis. But we have to be smart about implementation. Before we automate away those “junior” roles, we need to ask ourselves some hard questions. - Who will build the relationships that create organizational alignment? - Who will serve as the intelligence network for the CFO? - Who will develop into the next generation of financial leaders? Those aren’t rhetorical. They’re the backbone of what makes FP&A such a critical function. When I think back to that early division head who wanted me sitting next to her, it wasn’t because she needed a spreadsheet expert. She needed a partner. Someone who could help her understand what the CFO meant, who could translate financial direction into operational action. That’s what we do best. If there’s one message I’d leave my peers with, it’s this: formal relationships in an organization are about accountability. Informal relationships are where progress happens. AI can help with the former: it can track [metrics](https://www.financealliance.io/cost-benefit-analysis/), flag anomalies, and produce reports. But it can’t build the informal trust that keeps a business humming. It can’t walk into a manufacturing plant, chat with the manager, and realize the production issue they’re facing ties directly to a sales forecast assumption. It can’t connect those dots through human conversation. We can. So yes, let’s embrace AI. Let’s use it to automate what it does best. But let’s also remember that the heart of FP&A isn’t [automation](https://www.financealliance.io/fp-a-automation/), it’s connection. ## **A fundamentally human profession** After all these years, and all those “funky” career turns, I’ve come to believe that financial planning is one of the most human professions in business. We don’t just analyze data. We build relationships that enable strategy. We connect dots across silos. We help the business understand itself. And as AI reshapes our field, our challenge will be to hold onto those uniquely human strengths. Because the most valuable thing any FP&A professional brings to the table isn’t their spreadsheet skills or their [forecasting](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) model. It’s their ability to connect people, to build trust, and to align the organization around a shared future. That’s something no algorithm can do. And it’s why, no matter how much technology evolves, FP&A will always be, at its core, a deeply human profession. --- *This article is based on Jay Dyer's brilliant talk at our FP&A Summit in Boston.* --- [**Take our Salary Survey**](https://www.financealliance.io/finance-alliance-salary-survey/) **to help highlight what’s really happening in finance, including how much finance professionals are making.** [Finance Alliance Salary Survey 2026Help shape the Finance Alliance Salary Report 2026, the global benchmark for finance salaries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-236.png)Finance AllianceTeresa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Finance_Salary_Report_Survey_Meta-1.png)](https://www.financealliance.io/finance-alliance-salary-survey/) ### Controller Summit | Virtual, October 2025 URL: https://www.financealliance.io/controller-summit-virtual-october-2025/ Last updated: 2025-10-20T12:53:52.000Z Catch up on all sessions from our first Controller Summit, from the likes of Dell, Merck, Microsoft, Yooz and more. _This post is for paying subscribers only._ ### Your Foreign Exchange Survival Toolkit URL: https://www.financealliance.io/fx-toolkit/ Last updated: 2025-10-20T15:02:55.000Z High-growth companies are focused on scaling fast. Currency markets are unpredictable; swings can hit margins overnight, complicate reporting, and create tough questions from the board. On top of that, managing multiple currencies is messy. Revenues in one, costs in another, investors reporting in a third, it’s easy for exposures to get lost in the shuffle. Most finance teams don’t have a treasury desk, so they end up scrambling for advice or stuck dealing with confusing jargon from providers. This toolkit gives you the clarity and practical tools you need to manage FX risk with confidence. - Identify where risks are hiding. - Protect your margins and cash flows. - Keep your board confident that you’re in control. ## What’s included: **FX 101 course:** A 7-part series FX crash course with Alex Bayle, a seasoned FX professional with over 20 years of industry experience. We'll cover how FX exposure works, why volatility matters, and what hedging really means. **FX exposure tool:** Input your upcoming cashflows and instantly see where your risks are by currency pair. Understand potential upside/downside for different hedging scenarios. **Price checker:** Enter the details of a trade with your existing FX provider, and we'll calculate and compare their rate with Bound. Use this tool to see what fair rates look like. **Business case template:** A polished, editable presentation containing slides on market outlook, risks and exposures, proposed strategies, expected outcomes, implementation timelines, and more. **Hedging policy template:** Get a comprehensive and customisable hedging policy template designed for Treasurers and Finance teams. **KYB:** Questions for your provider: When you work with an FX provider, you’re trusting them with both your money and your margins. The right questions reveal whether you’re getting transparency and alignment or hidden costs and unnecessary risk. In partnership with [**Bound**](https://bound.co/). ### 10 potential risks of mergers and acquisitions URL: https://www.financealliance.io/risks-of-mergers-and-acquisitions/ Last updated: 2026-01-28T16:41:32.000Z Mergers and acquisitions (M&As) can either propel your company to new heights… or plunge it into complete chaos. The stakes are high in any M&A deal, but don’t that let that knock your confidence. With careful preparation and a [strategic approach](https://www.financealliance.io/6-steps-to-transform-fp-a-into-a-platform-for-strategic-alignment/), you *can* lead a smooth transition. To help you do just that, we’ve compiled this guide outlining 10 M&A risks of acquiring a company – and more *importantly*, how to mitigate them. ## **Merger vs acquisition: What’s the difference?** Mergers and acquisitions (M&As) are intertwined in many ways, but there's a key distinction between the two: ### **What is a merger?** A merger occurs when two companies join forces to create a single, new company. Both companies combine their assets and liabilities. The existing companies essentially dissolve, and a new company is created. ### **What is an acquisition?** An acquisition is when one company (usually the larger of the two) takes over another company or a portion of another company. The acquired company (including its assets and operations) becomes part of the acquiring company, like a subsidiary or division. [Acquisitions](https://www.financealliance.io/acquisition-financing/) usually come about when one company expresses interest in acquiring the other. The key difference to keep in mind is that in a merger, two companies ***combine** into one new company. In an acquisition, one company is ***subsumed** into the other company and becomes part of it. ## **Types of M&As** If you thought M&As are straightforward, think again. They actually come in different forms, and each has a strategic purpose and possible implications. Knowing the different types of M&As can help you navigate the complexities that come with them. ![Types of M&As](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/Types-of-M-As-1.png) Here’s some more information about each of the main types of M&As and *when* they’re most likely to happen: ### **1\. Horizontal mergers** This type of merger occurs between companies operating in the same industry. It usually takes place between direct competitors that offer very similar products or services. The most common reasons for a horizontal merger include: - Consolidating market share - Reducing competition - Achieve economies of scale ### **2\. Vertical mergers** A vertical merger happens between companies at different stages of the supply chain. A common example would be something like when a manufacturer decides to join forces with one of its suppliers. These unions are all about: - Streamlining the production process - Cutting costs - Eliminating the middle players - Gaining more control over the [supply chain cycle](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) ### **3\. Conglomerate mergers** Conglomerate mergers are slightly different because they happen when companies from unrelated industries and/or business activities join together. These can usually be split into two sub-categories: - **Pure conglomerates** (completely unrelated businesses) - **Mixed conglomerates** (some related and some unrelated businesses) This type of merger tends to occur when companies want more [diversification](https://www.financealliance.io/steering-through-storms-a-cfos-guide-to-economic-resilience/). By spreading their bets across multiple industries, companies can reduce their overall risk if one sector hits a rough patch. ### **4\. Market-extension mergers** Sometimes companies that sell similar products decide to join forces, but *not* because they're competitors. Market-extension mergers happen when these companies are operating in completely different markets or regions. The two main reasons why companies would want to pursue market-extension mergers are: - Expand their market reach - Grow their customer base ### **5\. Product-extension mergers** The final type of merger we’ll cover in this guide is the product-extension merger. This often occurs between companies that sell different but related products in the same market. Product-extension mergers help companies broaden their product lines and offer complimentary products to their customers. ## **Real-world examples of successful mergers and acquisitions** Seeing the main types of mergers and acquisitions in action makes these categories far more tangible. Let’s ground each type with a [real-world example](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/) you can actually picture: **Horizontal merger**: Think of the 2015 merger between Kraft Foods and Heinz. Both were major players in the food industry, offering similar products. By joining forces, they consolidated market share and reduced competition. **Vertical merger**: Amazon’s acquisition of Whole Foods in 2017 for $13.7 billion. Amazon, a retailer and logistics powerhouse, bought a grocery chain to gain more control over its supply chain and reach consumers directly. **Conglomerate merger**: When Berkshire Hathaway acquired Precision Castparts (an aerospace manufacturer) in 2016 for $32.1 billion. Berkshire operates in insurance, utilities, and more (completely unrelated to aerospace) demonstrating diversification across industries. **Market-extension merger**: A great example is the merger of Wells Fargo and Norwest in 1998\. Both were banks, but they operated in different U.S. regions. By merging, they expanded their geographic reach and customer base. **Product-extension merger**: Microsoft’s 2011 acquisition of Skype for $8.5 villion fits here. Microsoft already offered communication tools, but Skype added a new, related product line, broadening Microsoft’s offerings to its existing customer base. The motivation behind each type (whether it’s market share, supply chain control, diversification, new markets, or product expansion) shapes the outcome and risks of the deal. [Are you prepared to navigate the intricacies of an M&A?David Yates, CFO at Gresham, takes you on a journey through the intricacies of an M&A so you can unlock the best returns for your organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-230.png)Finance AllianceDavid Yates![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--48--2.png)](https://www.financealliance.io/are-you-prepared-to-navigate-the-intricacies-of-an-m-a/) ## **When to choose a merger or an acquisition?** Understanding the technical difference between a [merger and an acquisition](https://www.financealliance.io/m-a-best-practices/) is only the beginning; what really matters is why a company would choose one path over the other, and what that decision means for your strategy. Mergers are often about partnership and balance. When two companies of similar size and strength want to pool resources, share risks, and create something new together, a merger can be the right move. This [approach](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/) tends to foster a sense of shared control and mutual integration, but it also means navigating complex governance and blending two distinct cultures. Acquisitions, on the other hand, are usually about control and speed. If your company needs to quickly enter a new market, acquire new technology, or eliminate a competitor, an acquisition offers a more direct route. The [acquiring company](https://www.financealliance.io/acquisition-financing/) calls the shots, which can streamline decision-making but may also lead to resistance from the acquired team or customers. As David Yates, CFO at Gresham, puts it: > "The rationale, why are we why are we doing this? Like, why why do you wanna go and buy someone? You've got your organic growth at the moment... there's a strategic rationale." That rationale (whether it's gaining [market share](https://www.financealliance.io/a-complete-guide-to-competitive-intelligence/), accessing new capabilities, or accelerating growth) should drive your choice. For example, if two regional banks want to expand their footprint and compete with national players, a merger allows them to combine forces and resources on equal footing. But if a tech company wants to [leapfrog into AI](https://www.financealliance.io/ai-in-fp-a/), acquiring a nimble startup with proprietary algorithms might be the smarter play. In short, mergers are about [collaboration](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/) and shared vision, while acquisitions are about decisive action and integration. The right choice depends on your goals, your culture, and your appetite for complexity. ## **10 risks in mergers and acquisitions** These 10 risks have tripped up many companies going through a merger or acquisition, which is why you not only need to be aware of them, but know how to overcome them. So, keep these 10 M&A risks in mind as you navigate your deal: ### **1\. Overvaluing the target company** We've all heard the saying, "*Don't bite off more than you can chew.*" Well, that's especially true when it comes to M&As. A study by [Harvard Business Review](https://hbr.org/2011/03/the-big-idea-the-new-ma-playbook) found that between **70%** and **90%** of M&A deals fail every year and you can bet that overvaluation is a *major* culprit. Overvaluing the target company can lead to overpayment and reduced return on investment (ROI), putting a strain on your finances. Overvaluing in the M&A process usually comes down to: - Overly optimistic projections - Inadequate due diligence - Failure to account for potential market shifts - Pressure to close quickly - Emotional attachment to the deal - Turning a blind eye to negative findings These factors can cloud judgment by placing too much weight on the target company’s best-case scenarios and growth assumptions. There’s nothing wrong with having a positive outlook, but this optimism [bias](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) can lead to overlooking potential risks and challenges that could be detrimental to the deal. To [mitigate](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) this risk, make sure you give the target company a thorough and objective evaluation. This means looking at its past performance and future potential. Use different valuation methods like: ![3 common valuation methods](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/3-common-valuation-methods-1.png) And remember, pursuing independent valuation never hurts. External financial advisors can offer an unbiased perspective, reducing the risk of overpaying. If the deal isn't adding up, don't be afraid to walk away. ### **2\. Inadequate due diligence procedures** Poor due diligence is one of the most common acquisition risks. The problem is that it gives you a false sense of security, only to reveal the truth later in the form of unforeseen liabilities, financial misrepresentations, and [operational challenges](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/). All of these can then lead to more issues like significant [financial losses](https://www.financealliance.io/financial-charts-and-graphs/), damaged reputation, and costly lawsuits. Here are some strategies to help sidestep these issues: 🗂️ **Make your due diligence process as comprehensive as possible**. It should be multi-faceted and consider the target’s financial health, operational efficiency, legal standing, and strategic alignment with your company. 🤝🏽 **Consider assembling a multidisciplinary team** of both internal and external experts to ensure a thorough assessment. We’re talking [accountants](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/), lawyers, industry specialists, and HR professionals to uncover potential risks across different areas – leave no stone unturned! 🔎 **Keep monitoring and assessing risk** as new information comes to light. As negotiations progress and new information surfaces, continuously assess risks, adjust your strategy, and implement mitigation measures as needed. According to Christopher Toumajian, CFO at EP Wealth Advisors: > “You’ve done your valuation, you’ve worked on your capital plan, now it’s time to really dig in on the target firm.” He emphasizes that financial due diligence means reviewing financial statements, understanding key performance indicators, and tracing cash flows to ensure you’re actually acquiring the [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) you expect. But it doesn’t stop there. Legal due diligence checks for pending lawsuits, regulatory issues, or problematic contracts. Operational due diligence examines supply chains, IT systems, and [HR practices](https://www.peoplealliance.com/) to identify integration challenges or hidden costs. A practical due diligence checklist often includes: - Reviewing audited financials - Analyzing customer and supplier contracts - Assessing outstanding debts and leases - [Checking compliance](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) with laws and regulations - Evaluating cultural fit. You might also want to bring in outside experts for specialized reviews. Sometimes, a fresh set of eyes catches what internal teams might miss. ### **3\. Limited owner involvement** It might seem like an obvious necessity for a successful M&A, but you’d be surprised at how many owners take a step back during the process. This can happen when the company has paid for some type of M&A [advisor](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) and some owners will assume the hired help has everything under control. However, owners should be involved throughout the entire process. Owners need to be involved because they hold a wealth of [knowledge](https://www.financealliance.io/17-finance-business-processes/) about things like the company’s history, market dynamics, and [customer](https://www.financealliance.io/how-fp-a-teams-calculate-and-reduce-customer-churn/) base. Sidelining them can lead to overlooking critical factors that could impact the integration's success. If it’s a case where the owner of the target company feels excluded, they might resist the imposed changes, which can cause cultural clashes within the combined entity. Another issue is when the owner is very disengaged and fails to support the integration process as needed. Their employees, noticing the owner’s lack of advocacy and guidance, can quickly lower morale and productivity, which can slow down the entire integration timeline. To help mitigate this M&A risk, put these things in motion: - **Build clear communication channels** with the owners from the very beginning of the deal. Keep them informed of the M&A process, address their concerns openly, and actively solicit their input. - **Seek the owner’s advice** on things like product development, customer relations, and so on. Remember, they have unique knowledge of the company, knowledge that you definitely want to obtain [before the deal closes](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/). - **Acknowledge the emotional significance of the M&A** for the owner and emphasize the positive aspects of the deal, such as growth opportunities and a secure future for their employees. ### **4\. Missed opportunities for capturing synergies** A stark contrast emerges when examining synergy capture in M&A deals. According to PwC’s report, ‘[*Success factors in post-merger integration*](https://www.pwc.de/de/deals/success-factors-in-post-merger-integration.pdf),’ companies that achieve successful integrations see a significantly higher rate of synergy realization – over **83%** – compared to less successful acquirers, where less than half (**47%**) manage to capture the anticipated synergies This shortfall can lead to underwhelming financial performance and a diminished return on investment (ROI) for the acquiring company. To make sure you capture synergies properly, there are a few steps you can take: ![4 steps to capture synergies](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/4-steps-to-capture-synergies-1.png) ### **5\. Integration failures** When two companies struggle to integrate, they can miss out on the reasons why the deal was agreed to in the first place such as cost savings through streamlined operations and boosted market share through combined customer bases. It’s not just operational integration issues either, many companies also fail to integrate culturally too. [McKinsey](https://www.mckinsey.com/capabilities/people-and-organizational-performance/our-insights/organizational-culture-in-mergers-addressing-the-unseen-forces) states that **95%** of executives describe cultural it as vital to the overall success of integration. However, **25%** cited a lack of cultural cohesion and alignment as the number one reason integration efforts fail. [PwC’s M&A Integration Survey](https://www.pwc.com/us/en/industries/assets/pwc-2023-ma-integration-survey.pdf#page=10) revealed even more insights into the importance of integration in a successful M&A deal. Here are a few highlights from their report: > **60%** of companies are now developing their long-term operating models before due diligence begins. > **75%** of successful acquirers report extensive experience in these complex transactions, compared to only **43%** of other respondents. > **59%** of companies spent **6%** or more of deal value on integration. To help navigate issues related to M&A integration, remember to focus on people, not just processes. If you want the M&A to be a success, you need your team to be motivated and supported during the entire process. So, develop a [talent retention strategy](https://www.financealliance.io/finance-talent/) to prevent key employees from jumping ship. Create opportunities for collaboration between the merging teams, encouraging knowledge sharing and fostering a sense of shared purpose. ****Tip:** Acknowledge and celebrate milestones along the way to help keep team morale high. ### **6\. Security concerns** While companies aim to combine strengths, the M&A process itself creates vulnerabilities and can leave companies open to security threats. There are a few reasons for this such as: - Sensitive [data exchange](https://www.financealliance.io/7-data-management-problems-and-solutions/) during due diligence opens new attack points for hackers. - Integrating disparate IT systems can leave temporary gaps in security. - Disrupted workflows and employee focus during the transition can further weaken defenses. [Forescout’s study](https://www.forescout.com/resources/cybersecurity-in-merger-and-acquisition-report/) into the role of cybersecurity in mergers and acquisitions revealed that **53%** of their respondents stated that their companies experienced critical cybersecurity issues during the M&A process, which imperiled the deal negotiation. [Deloitte](https://www2.deloitte.com/content/dam/Deloitte/in/Documents/risk/in-ra-cybersecurity-for-mergers-and-acquisitions-noexp.pdf) emphasizes the importance of being secure, vigilant, and resilient before, during, and even [after the M&A process](https://www.financealliance.io/podcast/how-to-survive-a-post-merger-integration/), stating: > “*Being secure means having risk-prioritized controls to defend against known and emerging threats.* > *“Being vigilant means having threat intelligence and situational awareness to identify harmful behavior.* > *“Being resilient means having the ability to recover from, and minimize the impact of, cyber incidents*.” – **Deloitte (*Role of cybersecurity in M&A*)** To tackle these issues head-on, prioritize: - **Security-first due diligence** \- Don't just assess financial health – evaluate the target company's cybersecurity practices. - **Phased integration with security at the forefront** \- Develop a phased integration plan that prioritizes security throughout the process. - **Maintain vigilance during disruption** – Maintain regular security awareness training for employees. Allocate sufficient resources for IT teams to monitor for suspicious activity and remain vigilant against cyber threats. - **Third-party vetting -** Thoroughly vet any third-party vendors involved in the M&A process. Ensure their security protocols meet your standards and pose no additional risks to your combined data security posture. By taking these proactive measures, you can help mitigate the [cybersecurity risks](https://www.financealliance.io/cfo-cybersecurity/) associated with M&A deals and ensure a smooth and secure integration process. ### **7\. Unforeseen costs** [Bain & Company](https://www.bain.com/insights/looking-back-m-and-a-report-2024/) reported that the global M&A market has recently dropped by **15%** to **$3.2 trillion** (the lowest level in a decade). One of the main reasons for the drop was associated costs related to closing M&A deals. It’s not an entirely new concept though. Surprise expenses can often pop up during M&A transactions like unexpected integration costs, legal fees, or [regulatory](https://www.financealliance.io/finance-and-compliance/) penalties. Bain & Company shared that **95%** of their respondents agreed that rising interest rates have made them adapt their M&A strategy. The survey found the biggest change (cited by two-thirds) was companies being choosier about the deals they went after. To avoid hidden or unexpected costs, set up a financial safety net to cover unforeseen expenses and run [scenario analyses](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/) to prepare for potential risks. Also, try to keep communication lines open with legal and regulatory authorities to spot potential compliance issues early, which will allow for proactive planning and [cost management](https://www.financealliance.io/saas-cost-management/). [Cost-benefit analysis: 5 steps to turn data into smarter choicesIf you want to learn more about what cost-benefit analysis is and how to do it, keep reading as we dive into five key steps to streamline your financial evaluations and drive smarter decisions. 🧠![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-231.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--6--1.png)](https://www.financealliance.io/cost-benefit-analysis/) ### **8\. Litigation risks** One of the biggest risks of an M&A deal is related to litigation threats from various [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) like shareholders, regulators, employees, and competitors. Some common areas of litigation include: - **Shareholder lawsuits** alleging breach of fiduciary duties, inadequate disclosures, or unfair deal terms. - **Antitrust challenges from regulatory bodies** over potential monopolistic behavior or reduced competition. - **Employee lawsuits** related to compensation, benefits, or workforce reductions. - **Intellectual property disputes** with competitors over patent infringement or misappropriation of trade secrets. Litigation can disrupt and delay the M&A process. Worst-case scenario, you could end up with the termination of the deal. And even if the lawsuits are eventually dismissed, the legal fees, management distraction, and reputational damage can be hard to recover from. It’s important to put processes in place to mitigate these risks carefully. For example, you might want to: - Conduct a thorough IP review. - Partner with antitrust experts and [regulatory advisors](https://www.financealliance.io/finance-and-compliance/) early on. - Make sure the deal terms are fair and reasonable for everyone involved. - Explore M&A-specific insurance policies, such as representations and warranties insurance, to transfer certain litigation risks to insurers. - Involve experienced M&A legal counsel throughout the process. ### **9\. Insufficient communication and transparency** Poor [communication](https://www.financealliance.io/cfos-role-in-investor-communications/) and lack of transparency during M&A can cause confusion, mistrust, and resistance among employees and stakeholders. It's easy to overlook this risk. But it can have a significant impact on the success of the transaction. Unfortunately, communication is an issue that’s often overlooked during mergers and acquisitions. [Financier Worldwide magazine](https://www.financierworldwide.com/managing-ma-communication) talked about this issue in detail in a past issue: > *“While the deal team and management are rushing to get the deal signed and announced, they cannot lose sight of internal communication." -* **Josh Hochberg, Deputy General Manager of Financial Communications at Edelman.** Another great quote from the same feature emphasized the importance of keeping everyone in the team in the loop. As noted by **Nicole Alvino, co-founder and Chief Strategy Officer for SocialChorus:** > *“During times of change, companies need to reach all employees with the right information at the right time.* > *"If a company does not have an M&A communication plan in place, it can leave employees uncertain and misinformed.”* To help maintain proper communication during an M&A deal, you need to build a solid M&A communication plan that covers key messages, channels, and a schedule for updates. So, how can you create something like this? You can start by defining your objectives for the plan. This could be something like managing expectations or maintaining transparency. Once you’ve got that locked in, move on to identifying key stakeholders such as: - Employees - Management - Customers - Suppliers - Investors Then, develop a strategy that includes clear, consistent messages tailored to each group. Don’t stick to one communication channel but make sure to incorporate a blend of channels like emails, meetings, and press releases to make sure everyone is informed. From there, you can make a clear plan for [communicating](https://www.financealliance.io/cfos-role-in-investor-communications/) before, during, and after announcing the merger. Ensure two-way communication by setting up feedback channels and scheduling regular updates to address concerns. Once the plan is in motion, pay close attention to how it’s going over with stakeholders. Gather feedback through surveys, online forums, or just informal conversations. If people seem confused, frustrated, or have a lot of the same questions coming up, that's a sign you’ll need to make some changes to your approach. ****Remember:** even with the best intentions, things can go wrong. So, have some contingency plans in place, and a rapid response team ready to address any arising issues quickly. Make sure your managers are trained to handle employee concerns and communicate effectively during the transition. Following an approach like this will help ensure a smooth integration. ### **10\. Market disruptions and unpredictable events** Market disruptions and unpredictable events, like economic downturns, geopolitical changes, or industry shifts, can greatly impact the success of an M&A transaction. These events might affect the target company's [performance](https://www.financealliance.io/32-cfo-kpis/) or the overall business landscape, possibly reducing the acquisition's anticipated benefits. Although it's impossible to predict all market disruptions and unpredictable events, CFOs can build resilience into their M&A strategies. Conduct thorough market and industry analyses during due diligence to identify potential risks and trends that could impact the transaction. Develop [contingency plans](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) and explore alternative scenarios to help prepare for unexpected market changes. A flexible integration plan that adapts to evolving circumstances is key to navigating market disruptions and unpredictable events. --- ## FAQs: Risks of mergers and acquisitions What are mergers and acquisitions (M&A)? Mergers and acquisitions (M&A) refer to the consolidation of companies or assets through various types of financial transactions. Mergers involve two companies joining together to form a new combined entity, while acquisitions involve one company purchasing another and establishing itself as the new owner. What are the risks associated with M&A? M&A deals come with a number of risks, including overpaying, failure to achieve expected synergies, culture clashes, key talent losses, regulatory hurdles, customer attrition, and complex integration challenges. What is key person risk in M&A? Key person risk in M&A refers to the potential loss of critical employees, executives, or technical experts’ post-acquisition whose skills and knowledge are essential for the combined entity's success. Their departure can severely impact operations, strategy execution, and realization of deal synergies. What is acquisition risk? Acquisition risk refers to the chance that an acquisition will fail or fall short of expectations, both financially and in terms of smooth integration overall. It can cover risks across all phases of acquisition such as screening, evaluation, deal execution, and post-merger integration. What is execution risk in M&A? M&A execution risk is the chance that the deal's benefits, like cost savings or growth, won't materialize. This can happen if merging companies face unforeseen challenges, struggle to unlock synergies or encounter employee morale issues during integration. Are mergers and acquisitions low risk? Mergers and acquisitions (M&A) are not low-risk and generally high-risk endeavors. This is because they involve complex integrations and carry the potential to fall short of financial goals or struggle to combine the companies successfully. What are the risks of post-merger? Post-merger risks include integration challenges, culture conflicts, key talent losses, systems incompatibilities, customer defections, and failure to capture revenue/cost synergies. What are the pitfalls of mergers and acquisitions? Some common pitfalls in M&A deals include unrealistic expectations, neglecting cultural fits, poor due diligence, overpaying, integration issues, unforeseen problems, losing key talent, missed targets, and underestimating complexities in combining entities. What are the failure factors of M&A? M&A deals can hit snags if the groundwork isn't laid properly (poor planning or missing key issues) if the price tag is too high, or if the companies clash culturally (leading to unhappy employees). Losing key talent during the shuffle can also be a big hurdle. What are the 3 disadvantages of mergers and takeovers? Three key disadvantages of M&A are high deal costs, culture clashes disrupting productivity and complex integrations. Some other potential disadvantages include retaining talent, overpaying and unrealistic synergy expectations. What is the negative impact of a merger or acquisition? Mergers and acquisitions can lead to loss of key employees due to uncertainty or restructuring. This can hurt the company's knowledge and disrupt operations, making it harder to achieve the expected benefits of the deal. What is the biggest concern that you have related to the merger? The biggest concern related to a merger often revolves around cultural integration, as ensuring that employees from both organizations can work together effectively and maintain morale is crucial for the success and smooth operation of the merged entity. How to mitigate acquisition risk? To mitigate acquisition risk, do deep research (due diligence), set achievable goals (synergy expectations), consider company cultures, plan the integration carefully, manage change effectively, keep key employees happy, and track progress closely. Why is communication important in M&A? Communication is so important in M&As because it everyone informed (transparency), reduces confusion (clarity), and helps employees from both companies feel like they're on the same team (unify cultures). How to handle internal communications during a merger? Develop a clear communication plan with regular updates on the integration process. Use FAQs, and leadership messages to address concerns and make sure everyone feels heard by using a variety of channels like email, webinars, and open meetings. Most importantly, be honest and transparent throughout the process. How can you evaluate communication effectiveness in a merger or acquisition? Evaluating communication effectiveness in M&A can involve sentiment surveys, intranet traffic monitoring, feedback channels, focus groups, and employee engagement scores. ### How FinTech is being empowered with AI and analytics URL: https://www.financealliance.io/fintech-and-ai/ Last updated: 2025-10-13T12:41:55.000Z *This article was adapted from one of our previous virtual FP&A Summits, featuring Amit Kurhekar, when he was Head of Data at MoneyLion. Amit is currently a Fractional Chief Data & Digital Officer at* TransformTechX. --- Unless you’ve been consistently offline over the last few years, you’ll know that the financial industry is undergoing a significant [transformation](https://www.financealliance.io/key-trends-shaping-the-future-of-finance/) driven by AI and [machine learning](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/) technologies. This revolution isn’t just about adopting new technologies but about changing how financial services and processes are delivered and experienced by consumers. In this article, we’ll explore some of the most compelling AI and ML strategies in finance with use cases to show how they work in real-life scenarios. Whether you're a financial professional or simply interested in the evolving landscape of FinTech, this article offers valuable insights into the intersection of finance, AI, and [digital transformation](https://www.financealliance.io/how-finance-digital-transformation-impact-company/). ## **Case study: Day in the life of ‘financially savvy’ John** Let me introduce you to John. He considers himself to be very financially savvy, he’s in his 30s, intelligent and he uses a smartphone like so many of us. One day, he receives a notification on his phone that reads “*John, your utility bill of $50 is due tomorrow. Do you want to pay now?*” A few seconds later, another notification comes through, “*John, your net-worth increased by 1% last week with Apple stock making the maximum gains.*” John gets on with his day. He goes to work, enjoys chatting to his co-workers, and then in the afternoon, he notices yet another notification on his phone. This one says, “*John, you have excess balance in your savings account. Invest 20% of the amount to earn an extra 8% vs keeping in your savings account. Invest now?*” These are smart notifications and nudges and in today’s financial world, it's a reality. If you’re not using technology to help improve your finances, you’re missing out. By embracing AI and ML, you can make a huge impact not just in your role but also in your daily life. [![How FinTech is being empowered with AI and analytics](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/08/Screenshot-2024-08-08-at-09.53.29.png)](www.financealliance.io/fintech-and-ai/) ## **Pillars of digital transformation** Within [digital transformation](https://www.financealliance.io/driving-digital-transformation-in-finance/), there are emerging technologies. Most companies are utilizing these emerging technologies to drive and improve consumer experiences. These include things like internet of things (IoT), robotics, AR/VR and Cloud. [![pillars of digital transformation](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/08/Screenshot-2024-08-08-at-09.53.45.png)](www.financealliance.io/fintech-and-ai/) Before 2020, not many people were working online or working from home, and then almost the majority of the IT workforce moved into [remote working](https://www.financealliance.io/transitioning-to-fractional-financial-leadership-how-to-lead-in-2-4-days/). The transformation from almost everyone working in-office to everyone working remotely because of Covid meant that many people had to embrace technology in new ways. There was a huge mobilization of IT and IT infrastructure. I think that both [AI and ML](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) are critical pieces that are enabling today's world. So, a part of that could be coming as simple as receiving smart nudges throughout the day on your smartphone or you could even have nudges to help you forecast numbers for your [financial forecast](https://www.financealliance.io/rolling-forecast-best-practices/). [How to design FP&A team structure (with examples)One of the hardest questions to answer about FP&A is ‘what is the typical FP&A team structure?’ This question is so hard to answer because there is no one-size-fits-all…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePatrick Dennehy![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/Copy-of-FA_Website_Article_Images_Author_Highlight--2-.png)](https://www.financealliance.io/fp-a-team-structure/) ## **Applications of AI and analytics in FinTech** Now I’d like to talk about some applications and use cases of applications of AI and analytics in finance and FinTech. ### **Personal finance and wealth management** Personal finance and wealth management is one of the largest domains which adopted and started leveraging [digital transformation](https://www.financealliance.io/your-guide-to-finance-transformation/). When you’re swiping your credit card or spending money on your savings account, basically what you're doing is putting those transactions on your savings card. With that, you’re enriching those transactions and getting key insights to help you improve your finances. You can do your all your [financial planning and budgeting](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/) through a simple app. So, think about that when you are thinking about asset allocation or wealth management. Using technology in finance is so common. If you think about it, nobody goes into a bank to open a new bank account. Nowadays, everything happens online (at least for the most part). Here are some more key areas in personal finance where AI is extremely helpful: - Aggregation of financial portfolio and enrichment - Expense tracking and [budget management](https://www.financealliance.io/flexible-budget-performance-report/) - Intelligent alerts and recommendations for personal finance and wealth management ### **Credit history: Automated underwriting** If you’re an unorganized sector, and you don’t have the equivalent of a credit rating, it’s extremely hard to get loan. So, what do you do in that case? Well, you can utilize AI and ML to help with the underwriting process. It can even help you borrow a loan instantaneously. Areas where AI and ML can assist with underwriting: - [Financial data](https://www.financealliance.io/data-cleaning-techniques/) aggregated/PDF statements - Identify income/salary - Identify existing loans, recurrent spending and monthly expenses - Predict monthly income and date - Predict probability to pay back and eligibility - Instant online loan approval for applicant What tends to happen in the credit industry today is that if someone doesn't have any rating available, which could the case with a small or medium sized business, you would have to upload your [data](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/) which can include financial records, a PDF account statement, etc. and this data is read by the AI and ML algorithm. AI and ML algorithms can identify where a user is spending, their existing loans, and their income or salary. For salary income, the algorithms predict recurring spending patterns, monthly income, and the date when the next salary or income is expected. They also assess the probability of payback and [eligibility for a loan](https://www.financealliance.io/acquisition-financing/). When considering AI for automated underwriting, the system predicts the user's likelihood of repaying the loan and evaluates their legal standing. This makes borrowing a loan online a simple process, leading to instant online loan approval, which is common in today's credit industry. Many organizations, including Moneylion and others worldwide, use [automated](https://www.financealliance.io/fp-a-automation/) underwriting. [5 startup financing and VC funding tipsLet me start by saying that fewer than 1 in 10,000 new businesses in the US receive venture capitalist (VC) funding, so being backed by VC is by itself a very difficult task…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceArtem Malinin, Ph.D, MBA![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/Copy-of-FA_Website_Article_Images_Author_Highlight--1-.png)](https://www.financealliance.io/5-startup-vc-funding-tips/) ### **Fraud detection** Another critical use case for AI in the financial industry is [fraud detection](https://www.financealliance.io/ai-in-risk-management-how-banks-can-mitigate-fraud-and-financial-crimes/). Think about credit card fraud detection, those alerts you get when your credit card is used in a different location for an unusual amount. This is [enabled by AI](https://www.financealliance.io/ai-in-fp-a/) and is one of the most common and relatable use cases for users. During COVID-19, there were numerous insurance claims submitted across cities and countries due to government support. However, not all of these claims were legitimate, leading to a rise in fraudulent bills. Companies had to develop algorithms to identify these fraudulent claims based on user profiles and historical health metrics. These algorithms could detect similarities in amounts, names, and other details to pinpoint fraudulent activities. AI and ML have also played a crucial role in banking authentication for payments and transfers, enabling almost real-time [fraud detection](https://www.financealliance.io/fraud-detection-in-2025-lessons-from-a-decade-in-the-trenches/). This makes fraud detection one of the most important areas in the financial and FinTech industry. Here are some of the ways technology can assist with fraud detection: - **Credit card fraud detection** – Alerts for [fraudulent transactions](https://www.financealliance.io/how-hackers-steal-your-card-details-bin-attacks-protection-tips/) - **Insurance claim fraud detection** – Identifying fraudulent bills based on user profile and health metrics - **Banking authentication** for payments and transfers ### **Banking and online verification** In the banking and financial industry, eKYC (electronic Know Your Customer) processes have become crucial. In India, for instance, the Aadhaar infrastructure allows users to open a bank account online with just one SMS. By installing the bank's app, users can complete their verification and KYC process online. KYC, which stands for [Know Your Customer](https://www.financealliance.io/api-first-engineering-for-security-scalability-and-compliance/), involves the identification of customers to open a bank account. AI enhances this process by enabling video KYC, reducing the probability of fraud by validating user information. When users scan their passport or ID card, AI can identify any mismatches in the information, ensuring a more secure and efficient verification process. [How financial services firms can protect against AI fraudNearly 70% of Americans say they would pay more for services that offer stronger protections, and 83% believe financial institutions should be doing everything possible to protect them from fraud.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-227.png)Finance AllianceGreg Bohl![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-1.png)](https://www.financealliance.io/how-financial-services-firms-can-protect-against-ai-fraud/) ### **Conversational AI and chatbots** [Chatbots have become essential in modern financial services](https://www.financealliance.io/exploring-the-transformative-power-of-ai-in-finance/), offering various functionalities: - **Customer support**: Chatbots provide personalized and efficient customer support, handling queries and resolving issues quickly. - **Site navigation and product decision support**: They assist users in navigating websites and making early product decisions by providing relevant information and recommendations. - **Form filling**: Chatbots streamline form-filling processes, making it easier for users to complete necessary documentation. AI and ML are the common factors driving these [chatbot](https://www.financealliance.io/chatgpt-for-excel/) use cases. Conversational AI and chatbots have been around for some time, significantly improving customer support. When you interact with a service and receive personalized responses, there's a good chance a chatbot is behind it. ### **Financial forecasts** According to McKinsey, most capital investment projects face cost and schedule overruns. In fact, **79%** of such projects encounter these issues, with only **5.4%** meeting their cost and schedule targets. This highlights the critical need for effective [capital expenditure management](https://www.financealliance.io/10-structured-capital-strategies/), which is one of the quickest and most efficient ways to preserve cash. Drawing from my experience as a certified Capital Systems Manager at Procter & Gamble, I can attest to the challenges in this area. In the past, [financial forecasting](https://www.financealliance.io/3-cash-flow-forecasting-challenges/) was a complex and labor-intensive process. However, today, AI and analytics have revolutionized how we handle financial forecasts. [![AI and financial forecasting](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/08/Screenshot-2024-08-08-at-09.54.21.png)](www.financealliance.io/fintech-and-ai/) [Analytics](https://www.financealliance.io/use-of-data-analytics-and-bi-tools-trend-3-transforming-fp-a/) and AI simplify the process by providing accurate and timely data. For example, companies now have global tracking mechanisms and standardized dashboards that offer near real-time visibility across all manufacturing sites. This capability enables organizations to adjust their forecasts and manage capital spending more effectively. By capturing data at every step, AI models can [forecast financial outcomes](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) for the coming days, weeks, and quarters. This predictive ability helps companies meet their free [cash flow](https://www.financealliance.io/cash-flow-drivers-in-a-business/) targets by providing actionable insights and enabling proactive adjustments. Ten years ago, every site required a dedicated Capital Systems Manager, and there were regional and global heads overseeing the process. Today, much of this work is automated. Reports and complete visibility are available at the click of a button, and adjusted [forecasting](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) can be driven by percentages and historical averages, leading to highly accurate predictions. This transformation in financial forecasting is one of the most significant advancements, demonstrating how [AI and data analytics](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) can streamline operations and improve efficiency in capital expenditure management. [12 financial modeling best practices to avoid frustrationsWhether you’re just starting in finance and FP&A or if you’re working on your next financial model soon, these 12 tips will be very handy.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/Copy-of-FA_Website_Article_Images_Author_Highlight--3--2.png)](https://www.financealliance.io/12-financial-modeling-best-practices-to-avoid-frustrations/) ### **Purchase to payments and accounts payable** Another important use case in the financial industry is the purchase to payment process, also known as [accounts payable](https://www.financealliance.io/17-finance-business-processes/). This area involves several complexities, including the acquisition of equipment and supplies across various sites within a company. To manage this effectively, companies use data cataloging and recommendation mechanisms. These systems capture purchase data and provide suggestions based on previous transactions, such as what similar items were bought and at what price. This process relies on machine learning (ML) solutions that use natural language processing (NLP) to understand queries and search capabilities within the catalog, unifying data across multiple sites. Today's payment systems are highly automated. Standard, off-the-shelf products assist with invoice scanning, capturing payment dates automatically, and ensuring payments are released on specific dates. These platforms can also optimize payment cycles and schedules by predicting the time needed to complete payments. They can alert you if payments are too early or too late, helping maintain the company's reputation. AI and analytics have significantly improved the purchase to payment process. They provide real-time insights and automate many tasks, making financial forecasting and accounts payable much more efficient. This transformation highlights how [AI and analytics](https://www.financealliance.io/why-black-box-ai-is-failing-fp-a-and-what-to-use-instead/) are simplifying and streamlining processes in both conventional companies and the FinTech world. I hope this gives you a clear picture of the current advancements in purchase to payment systems. I'm happy to answer any questions you might have and am delighted to share these insights at FB and assembly. --- Our [Slack community](https://www.financealliance.io/community/) is the space for finance leaders to share ideas, offer and receive advice from peers, grow their network, and so much more. [Join the Finance Alliance Slack CommunitySign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today! Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-228.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Meta_Images_Slack-Community-1-5.jpg)](https://www.financealliance.io/community/) ### Staying ahead: Key trends shaping the future of finance URL: https://www.financealliance.io/key-trends-shaping-the-future-of-finance/ Last updated: 2025-10-10T08:40:48.000Z Though I’m originally from Brazil, I’ve now called Mexico home for just over a year. During this time, I’ve had the privilege of leading [financial transformation](https://www.financealliance.io/what-is-finance-transformation/) initiatives in one of the most dynamic and rapidly evolving industries in the world. When I first arrived here, one of the things that struck me most was how quickly finance is changing, not only within aviation but across every sector. Concepts that didn’t even exist ten years ago, like “finance transformation”, are now at the center of strategic conversations. The intersection between finance, technology, and culture has become an essential frontier for growth, and I believe this convergence defines what it means to be a modern financial leader. Recently, I had the opportunity to share some of my thoughts at the [Finance Transformation Summit](https://fast.wistia.net/embed/channel/56wmtmqy2p?wchannelid=56wmtmqy2p&wmediaid=ifww0bo7ui), a gathering of peers and professionals passionate about the evolution of our field. What follows are the main reflections I shared that day; my view on where finance is headed, what challenges we face, and, above all, why the human element remains the most crucial factor in any [transformation](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/). ## **The strategic vision behind finance transformation** When we talk about finance transformation, it’s easy to get lost in the language of systems, [automation](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/), and digital tools. But at its core, transformation is a strategic evolution. It’s about where we are today and where we want to be tomorrow, not just as [finance teams](https://www.financealliance.io/fp-a-team-structure/), but as organizations aligned with ever-changing market realities. The strategy has to connect directly to the vision. Transformation initiatives that focus solely on implementing technology, without aligning with business goals or market demands, rarely deliver their full potential. We must continuously ask: *How does this project move us closer to our strategic vision? How does it respond to the new technologies and regulatory demands shaping our environment?* Our objective as financial leaders should not be to follow trends blindly but to leverage them intelligently to gain [competitive advantage](https://www.financealliance.io/navigating-uncertainty-why-agile-fp-a-is-your-competitive-edge/), drive efficiency, and foster a culture of innovation across the organization. ## **Technology as a tool, not the goal** I’ve always been deeply interested in [financial modeling](https://www.financealliance.io/10-best-financial-modeling-tools/) and technology. To me, technology is not a replacement for people but an enabler of better decision-making and creativity. The real transformation happens when we use [technology to change the way we think and work](https://www.financealliance.io/driving-digital-transformation-in-finance/). I often say that you can’t expect to achieve new results with an old mindset. You can deploy the most advanced [ERP](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/) or analytics platform in the market, but if your people still think in traditional, siloed ways, the [transformation](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) will remain superficial. In my experience, the greatest value of digital transformation comes from changing the culture, not just the [tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/). We must help people at every level understand that adopting new systems also means embracing new ways of [collaborating](https://www.financealliance.io/the-power-of-networking-case-study/), analyzing data, and making decisions. True transformation happens when people begin to see technology as part of their mindset; not an external imposition, but an extension of their own ability to innovate and improve. ## **The data-driven imperative** It’s widely known that around 70% of CFOs are focused on digital transformation today, and I believe the real number is even higher. Over the past decade, we’ve moved from intuition-based decisions to [data-driven](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) decision-making, and this shift is accelerating. At Swissport, as in many global organizations, data-driven insights are now central to the decision-making process. We can no longer afford to rely solely on historical reports. Our decisions must be informed by real-time [analytics](https://www.financealliance.io/use-of-data-analytics-and-bi-tools-trend-3-transforming-fp-a/) that give us visibility into operations, profitability, and performance as they happen. However, this transformation comes with challenges, particularly when regulatory and tax requirements, which vary significantly across countries. For example, when we implemented a new global billing system at Swissport, one of the most complex parts of the project was ensuring tax integration for local [compliance](https://www.financealliance.io/finance-and-compliance/). In Mexico, for instance, electronic invoicing must meet real-time validation requirements from tax authorities, something that doesn’t exist in countries like Germany or the United States. These differences mean that even a global system must be tailored locally, with adaptations to scope, data architecture, and compliance standards. The experience reminded me that [technology](https://www.financealliance.io/why-black-box-ai-is-failing-fp-a-and-what-to-use-instead/) can unify processes globally, but transformation still depends on understanding the local context. [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-223.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-3.png)](https://www.financealliance.io/financial-charts-and-graphs/) ## **The power of cloud-based solutions** Cloud technology has become the backbone of most modern finance transformations. Cloud-based solutions (those hosted online rather than on local servers) provide enormous benefits: [cost reduction](https://www.financealliance.io/5-cost-reduction-strategies/), scalability, flexibility, and most importantly, integration. What I love most about cloud systems is how easily they connect with each other. Almost all of them use API integrations, which allow systems to “talk” to one another seamlessly. This means we can create end-to-end financial ecosystems connecting [procurement](https://www.financealliance.io/100-day-procurement-plan-for-finance-leaders/), payments, [treasury](https://www.financealliance.io/corporate-treasury-guide-plus-3-strategies-to-save-your-company-a-fortune/), and accounting in a unified data flow. Take, for instance, processes like source-to-pay or order-to-cash. These end-to-end concepts demonstrate that finance is no longer about isolated functions but about integrated value chains. Whether it’s supplier bidding, purchase orders, payment processing, or reconciliations, cloud platforms make it possible to automate and monitor these flows in real time. Swissport learned that integration is where the real value lies. By connecting our systems, we eliminate redundancies, improve accuracy, and create faster, more insightful [financial reporting](https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/). It’s no longer just about installing a new tool but about reimagining the entire ecosystem of finance. ## **Cybersecurity: The hidden backbone of transformation** No conversation about technology is complete without addressing cybersecurity. It’s a topic that can’t be ignored, especially when [finance and IT](https://www.financealliance.io/how-finance-digital-transformation-impact-company/) work closely together. In 2022, Swissport faced a major ransomware attack that temporarily disrupted our global operations. For around four months, our billing systems were offline — a massive challenge for any finance organization. That experience was a turning point for us. In the aftermath, we took extensive global measures: new IT policies, stricter hardware standards, and a renewed emphasis on [cybersecurity](https://www.financealliance.io/cfo-cybersecurity/) training. Every employee now participates in simulations to identify phishing attempts; external storage devices like USB drives are prohibited; and we conduct regular security audits to test our resilience. [Financial data](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/) is often a primary target for cyberattacks. That’s why it’s critical for CFOs and IT leaders to collaborate closely when evaluating new financial systems. Cybersecurity can’t be treated as an afterthought, it must be integrated into the design and selection process from the very beginning. We’ve learned that technology brings efficiency, but also risk. The goal is not to eliminate risk (that’s impossible) but to manage and mitigate it proactively. [Fraud detection in 2025: Lessons from a decade in the trenchesLearn more about fraud detection and explore lessons to help companies stay secure in the face of persistent threats.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-224.png)Finance AllianceMaxim Filatov![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--55--2.png)](https://www.financealliance.io/fraud-detection-in-2025-lessons-from-a-decade-in-the-trenches/) ## **Finance and IT: A partnership for transformation** The collaboration between finance and IT is essential, as transformation cannot succeed without [cross-functional partnership](https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/). Finance professionals need to understand how new technologies will change our day-to-day work, while IT teams need to understand the strategic goals behind these initiatives. When both sides speak the same language, the results can be transformative. At Swissport, we’ve built regular committees where finance and IT jointly evaluate upcoming projects and set priorities based on value creation. For example, we might need to decide whether to prioritize a billing system that reduces [revenue](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) leakage or an accounting system that improves accuracy. Both add value, but the choice depends on the company’s strategic moment. In my opinion, value addition should always guide prioritization. Every project must be evaluated through the lens of which initiative adds the most value to the company right now. To support this process, we also maintain a permanent [finance transformation](https://www.financealliance.io/your-guide-to-finance-transformation/) agenda — not just a one-time effort. Transformation is continuous; it doesn’t end when a project goes live. The market evolves too quickly for that. Regular collaboration, recurring governance meetings, and continuous reassessment are the keys to staying ahead. ## **The benefits of integration and business partnering** When finance and IT collaborate effectively, the benefits go far beyond efficiency. For example, by implementing new [financial systems](https://www.financealliance.io/17-finance-business-processes/), Swissport reduced its monthly closing time from 7-10 days to just four working days. This acceleration means finance can now [provide insights faster](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/), enabling better decision-making across the organization. Integrated systems also allow us to connect financial performance with operational drivers (logistics, commercial activity, and other non-financial data) to create more meaningful analyses. Moreover, the evolution of low-code and no-code tools has empowered [finance professionals](https://www.financealliance.io/how-to-get-a-seat-at-the-table/) themselves. Today, many of our team members can model data, build reports, and automate tasks without relying exclusively on IT. It’s an exciting development because it allows finance to move closer to the front lines of decision-making. Agility is key. Businesses must respond rapidly to change, and finance has to be at the forefront of that agility. ## **The human side of transformation** Despite all this talk about systems, APIs, and [automation](https://www.financealliance.io/fp-a-automation/), I still believe the most important part of transformation is people. Technology alone doesn’t create change. People do. The tools we choose are only as powerful as the mindset of the teams that use them. That’s why communication is critical. Finance, IT, and other functions must talk to each other constantly, not through long chains of emails, but through real-time communication platforms that promote speed and collaboration. At Swissport, we use tools like [Slack](https://www.financealliance.io/community/) and Microsoft Teams to create dedicated groups that can discuss projects and make decisions quickly. Transformation also means empowerment. It’s not just about automating processes but enabling people to think more strategically, to move away from repetitive work and toward activities that truly add value. When employees see transformation not as a threat but as an opportunity to learn and grow, the organization gains resilience and adaptability, qualities that no software can replicate. ## **Preparing for the future: AI, machine learning, and regulation** Looking ahead, I believe the next major wave of change in finance will be driven by [artificial intelligence and machine learning](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/). In the next five years, maybe even sooner, AI will transform financial reporting, [forecasting](https://www.financealliance.io/14-dos-and-donts-financial-forecast/), and decision support. We will move from reactive reporting to predictive and prescriptive insights that anticipate business needs before they arise. At the same time, real-time data will become the new standard. Instead of closing the books and looking backward, finance will increasingly operate in real time, with dashboards that reflect performance minute by minute. Another area of rapid change is regulatory technology. It may surprise some to learn that Germany, for example, still does not have digital billing, while countries like Brazil and Mexico are pioneers in this space. Technologies like blockchain and real-time validation will make compliance faster, more transparent, and more secure. These developments will not only improve accuracy but also reduce implementation times for future transformation projects. ## **Closing thoughts** There’s a quote I love by George Bernard Shaw: “Progress is impossible without change, and those who cannot change their minds cannot change anything.” That line captures the essence of what finance transformation really means. The greatest value of transformation is not in efficiency metrics or system upgrades, but in the mindset of evolution that it instills in people. When a company’s culture embraces change (when its people are curious, agile, and open to learning) that’s when real transformation happens. Systems will come and go, technologies will evolve, but a culture of [innovation](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) and adaptability will endure. Finance transformation is not a destination, it’s a continuous journey. It requires vision, collaboration, and courage. As CFOs, our role is not only to manage numbers but to lead people through change, to connect technology with purpose, and data with insight. The future of finance belongs to those who are ready to learn, unlearn, and relearn continuously, and those who see technology not as a threat, but as an ally. --- *This article is adapted from *Bruno Oliveira*’s brilliant talk at the Finance Transformation Summit when he was still Chief Financial Officer at Swissport; Bruno is currently the* [*CFO and VP of Finance at Blockbit*](https://www.linkedin.com/in/bosilva/)*.* --- Join your fellow finance leaders in our [Slack community](https://www.financealliance.io/community/) to make new connections and grow your network, get answers to all of your questions, get inspired by finance wins, and share your own successes. [Join the Finance Alliance Slack CommunitySign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today! Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-225.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Meta_Images_Slack-Community-1-4.jpg)](https://www.financealliance.io/community/) ### Controller Summit: Speaker spotlight with Céline Duplessis (Yooz) URL: https://www.financealliance.io/controller-summit-speaker-spotlight-with-celine-duplessis-yooz/ Last updated: 2025-10-08T08:21:59.000Z ![Controller Summit speaker spotlight with Céline Duplessis (Yooz)](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/Copy-of-FA_Website_Article_Images_Author_Highlight--3--1.png) When finance teams face mounting pressure to do more with less, clarity and control have never been more critical, and [**Céline Duplessis**](https://www.linkedin.com/in/celineduplessis/) **is here to show how AI can make that possible**. As Product Evangelist at [Yooz](https://www.getyooz.com/en-gb/), Céline brings a wealth of international experience across sales, digital advertising, and marketing. Her deep understanding of both technology and business development fuels her mission to help organizations harness intelligent automation to drive smarter, more strategic finance operations. Céline is joining us at the **Controller Summit (October 15, 2025)** to lead a session that’s both timely and transformative: [**Boosting control & clarity: How AI is reshaping finance**](https://virtual.financealliance.io/location/controller/speaker/celineduplessis). Attendees will learn how to: - **Enhance internal controls** and reduce compliance risks through AI - **Improve financial visibility** and reporting accuracy with automation - **Take practical steps** to get started on their own digital finance journey We caught up with Céline ahead of the event to discuss how emerging technologies are changing finance, what true financial clarity looks like in an AI-driven world, and why now is the time to lead with innovation. [Get your ticket to the Controller Summit](https://virtual.financealliance.io/location/controller/) ### **What are the biggest challenges controllers face?** Controllers today face mounting pressure to adapt internal controls to increasingly complex regulatory environments and digital transformation requirements. The proliferation of data and automation tools demands sharper oversight to ensure accuracy, consistency, and compliance. At the same time, they must deliver real-time financial clarity to stakeholders while navigating fragmented systems and evolving business challenges. ### **What inspired you to talk about this topic in your upcoming session, and why do you think it’s so timely for controllers right now?** I thought that, funnily enough with AI, there is the fear of loss of control and loss of clarity with too much data, too many systems. The [goal of the session](https://virtual.financealliance.io/location/controller/speaker/celineduplessis) is to show the real applications of AI to the function of the financial controller. So, the opportunity was to define AI better and its use in particular for finance teams. ### **How do AI and automation strengthen internal controls and reduce compliance risk for finance teams?** True, the first reason and first step in implementing AI within the finance function is usually to automate low complexity tasks, data capture and workflows. In terms of internal controls, AI and can provide many tools: it can provide clear audit trails so that each operation is traceable, making internal reviews and audits efficient and transparent. Another application is within automated checks and validations. Here, AI can review transactions, journal entries and thus minimise errors. Finally, AI can ensure segregations of duties by helping maintain clear role separation and identifying potential conflicts in access or responsibilities. In terms of reducing compliance risks, AI can provide real time monitoring and detection of anomalies or participate in fraud detection by detecting suspicious behavior or unusual transactions. ### **How can automation help finance leaders move from fragmented data to a real-time “single source of truth”?** Automation streamlines data integration across disparate systems, reducing manual errors and enabling consistent, real-time reporting. This empowers finance leaders to make faster, more confident decisions based on a unified and trustworthy data foundation. ### **How does the adoption of AI and automation impact the skill sets controllers and their teams need to succeed in the future?** AI and automation are reshaping the controller’s role from analysing numbers and rules to strategic advisor. Teams now need stronger understanding of data and tech, and the ability to interpret insights. It’s less about a reactive role and more about a proactive one, supporting faster and better decision making. ### **How can technology free up time and capacity for controllers to focus more on strategic decision-making?** That's an easy one. By automating tasks like manual data entry, data capture, streamlining communication (but providing pre-checks ahead) AI and automation free teams from less strategic tasks and then can now use this time to focus on analysis and decision making. ### **What are some common misconceptions about AI in finance that you encounter?** First, there is the apprehension that AI will be difficult to implement on your current systems, and that your teams will take time to adopt it. That's not what we've seem. Solutions like Yooz for accounts payable are rapidly adopted by teams (and liked), as it makes their job easier and more qualitative. Sometimes we also encounter myths around issues with data security. But, if you make sure that the tool you are using is abiding by the latest security protocols, you end up protecting your business. Finally, there is a fear that AI will ultimately replace certain roles. That's not the case; there is a limit to what AI can replicate or interpret or create. AI is a helper but should always be used with an expert and not alone. ![Céline Duplessis quote](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/10/Celine-Duplessis-quote.png) ### **How is AI being used to proactively identify and prevent Cybersecurity and fraud risks?** Fraud is a big concern for businesses today, and there are many types of fraud. AI can be used in different ways here. If we take the example of accounts payable, there are mainly two ways in which AI can help with Fraud prevention. One, AI will check that the data matches in all documents so, if there is a mismatch anywhere, it will notify you. And then, for Yooz, we also use big data. I'll give you an example: If you receive an invoice from a supplier that has banking details which do not match our current big data (Yooz has processed over 300 million invoices over time), our system will raise an alert. ### **For controllers who are just starting to explore AI-driven automation, what practical first steps would you recommend?** We would recommend them to act gradually (take small steps first). An Accounts Payable Automation is an easy first step within the finance department. ### **Looking ahead, how do you see AI and automation reshaping the controller role over the next few years?** The controller's role will change in the next 5 years with a greater emphasis needed on technology literacy and data interpretation. Today, all businesses are looking into digitising their finance function to increase productivity and stay competitive, but also to face the different challenges of increasing regulations and requirements for transparency. I believe that the expertise will need to shift from an analytic standpoint to a proactive standpoint: being able to anticipate and navigate a world where the cycles are required to become shorter and shorter. ### **Finally, if attendees walk away from your session with just one insight or action item, what do you hope it will be?** That AI is reshaping the finance function and that there are actionable steps that need to happen for business to make a successful use of it. --- ## **Finance is changing fast. Are you ready to lead the change?** The **Controller Summit** is a free event where forward-thinking finance professionals come together to gain actionable insights from the best in the business and uncover strategies that actually work for controllers. 📅 **When:** 15 October, 2025 🗺 **Where:** Virtual Whether you’re looking to strengthen governance, boost financial visibility, or unlock smarter, data-driven decision-making, this is where your next chapter begins. [**Grab your ticket today**](https://virtual.financealliance.io/location/controller/)to joinCéline Duplessis and other industry leaders at the Controller Summit and be part of the future of finance. [Get your free ticket](https://virtual.financealliance.io/location/controller/) ### Why finance MUST change: The AI opportunity [Video] URL: https://www.financealliance.io/podcast/why-finance-must-change-the-ai-opportunity-video/ Last updated: 2026-02-17T10:59:51.000Z _No content available._ ### The strategic CFO: How finance is evolving from reporting to innovation URL: https://www.financealliance.io/the-strategic-cfo-how-finance-is-evolving-from-reporting-to-innovation/ Last updated: 2025-10-06T10:53:30.000Z I’ve been a four-time CEO and a three-time founder, but this is my first time in a dedicated [finance role](https://www.financealliance.io/what-does-a-finance-director-do/). I now serve as the CFO and CEO of Runway, where we build FP&A software, and I’ve learned that my entire entrepreneurial journey has been, in many ways, a masterclass in finance. It’s a journey of failing my way up, learning to build models, and understanding the levers that make a [business](https://www.financealliance.io/15-quick-fire-tips-to-boost-your-business-and-commercial-acumen-fast/) succeed or fail. This experience has given me a unique perspective on the evolution of finance. Over the past fifty years, the function has undergone a sea change, shifting from a backward-looking, accounting-focused discipline to a forward-looking, strategic, and cross-functional role. This isn't just a change in title; it's a fundamental [transformation](https://www.financealliance.io/driving-digital-transformation-in-finance/) in how we view and utilize finance to drive [innovation](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/). ## **The evolution of finance: From accounting to strategic partnership** The journey of finance toward a more strategic role has been driven by several key factors, most notably [technology](https://www.financealliance.io/10-best-financial-modeling-tools/). The invention of VisiCalc and the first spreadsheets in the 1970s was the first major leap. Suddenly, we could create models and think through new scenarios in ways that were previously impossible. ### **The technological catalysts for change** This progress accelerated in the late ‘80s and early ‘90s with the [ERP](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/) revolution, which made data more plentiful within organizations. As businesses became more cross-functional and faster-moving, the combination of data availability and better [modeling tools](https://www.financealliance.io/10-best-financial-modeling-tools/) converged to make finance a far more strategic part of the business than ever before. Today, we're seeing the next wave of this [evolution with AI](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/). These new tools are increasing the leverage of finance teams, allowing them to focus even more on the strategic work that drives the business forward. ### **The new expectations for finance professionals** The output of all this is a significant shift in career paths and expectations. We see data teams reporting directly to [finance](https://www.financealliance.io/17-finance-business-processes/). The function is less about just closing the books and more about supporting, and in many cases making, some of the most strategic decisions in the company. Accountants are now expected to be [analysts](https://www.financealliance.io/top-10-fp-a-skills-to-master/). Analysts want to be in finance. People in finance want to be CFOs, and CFOs are increasingly on the path to becoming CEOs. It’s a remarkable set of changes driven by major technological and competitive factors. ## **Bridging the gap: Why finance and business teams are often misaligned** For finance to be truly strategic, it must be seen as a [business partner](https://www.financealliance.io/transforming-from-accounting-to-fp-a-business-partnering/) to all key stakeholders, from the CEO down to department leads. Everything that happens in a company eventually flows to the bottom line, and a strategic finance team helps everyone understand that connection. However, a tension often exists between finance and other departments, largely created by a lack of good tooling. [The best working capital strategies for FP&AUncover the best working capital strategies for FP&A in this blog, which reveals how working capital management acts as a key cash driver.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-213.png)Finance AllianceLiudmila Gudina![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--42--1.png)](https://www.financealliance.io/the-best-working-capital-strategies-for-fp-a/) ### **The finance perspective: A desire for business understanding** People outside finance sometimes have a stereotype of the function as insular, like "number monks" who don't want to share their work. In my experience, the opposite is true. Finance professionals want the rest of the business to understand where the business is and where it's going. Their frustration is that, too often, other departments don't have a good grasp of the numbers or the key levers. Finance has a better understanding of these things than anyone else, and they want to share that knowledge. ### **The business perspective: Finance as an indecipherable black box** From the outside looking in, finance can feel like a cabal. You get sent indecipherable walls of numbers and are told to fill out a budget, without understanding what it's for. At the same time, department leaders need to make better decisions and want to know where to invest for the next 12 to 24 months. There is a mutual desire to connect, but for many reasons, the relationship isn't there. I believe this can and will rapidly change. ## **The financial model as a tool for thinking** When a new CFO comes in, what’s the first thing they do? They rebuild the model. They want to understand the business in a way that makes sense to them. This highlights a critical point: a model’s value is in its utility for [making decisions](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/). A good model is a piece of [software](https://www.financealliance.io/15-best-fp-a-tools-and-software/), a simulation of the business. It’s like a video game engine. If it doesn’t expose the right controls, people can’t play with it. If they can’t play, they won’t use it, and that lack of understanding creates a breakdown in the relationship. ### **The problem with the "one true model" mindset** Many departments, from product to marketing, have their own janky spreadsheet models. They exist for a reason: they are useful for making specific decisions. When a new CFO imposes a "proper" three-statement, GAAP-[compliant model](https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/), it may be accurate, but it might not be useful for the product team. If the new model doesn't account for the utility of the old ones, it can do more harm than good. You can’t just throw the baby out with the bathwater. You have to accommodate what people already have and understand why it works for them. ### **The importance of flexible, adaptable models** My background is in software, and software rots. It has to be continually maintained and evolved. I think about financial models the same way. The context of a business is always changing. When I was appointed CEO of a retail business 26 months before COVID hit, we didn’t have a control in our model for a global pandemic. We had to add it. Businesses are constantly evolving with new go-to-market motions, new SKUs, and new data sources. Planning is about more than just changing a number in a spreadsheet; it’s about changing the relationships within the model itself. [Copilot vs Claude for Excel: Which AI assistant wins?Copilot vs Claude for Excel: Which AI assistant wins for formula building? Find out here with Salvatore Tirabassi’s expert breakdown.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-214.png)Finance AllianceSalvatore Tirabassi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--72--2.png)](https://www.financealliance.io/copilot-vs-claude-for-excel-which-ai-assistant-wins-for-formula-building/) ### **Developing intuition through model exploration** One of the most underappreciated values of a good model is its ability to help you develop your own intuition about the business. By playing around with it (moving the timing of things, allocating different investments) you start to internalize the rough impact of your decisions. This is what allows you to react instinctively when bad things happen. If you have a strong, internalized model of your business, you'll have a much better sense of what to do when revenue suddenly drops. That intuition is built by having a flexible model you can actually explore. ## **How to embed finance as a true strategic partner** If your first instinct for aligning the organization is to "educate" everyone on finance, you're probably on the wrong track. Nobody wants to be taught something they didn't sign up to learn, especially something they perceive as boring. Instead, you have to show them the value in a way that aligns with their own motivations. ### **Forget “educating”, focus on incentives** When I joined Postmates, I wanted to introduce a data-driven experimentation framework. Instead of announcing I was going to "teach everyone growth," we quietly built what we called a "rollout framework." We launched features and could prove, with data, that they increased conversion by 10%. Soon, other departments saw the results and asked how they could do it too. Within a year, every new feature was wrapped in a test. The lesson is to understand people's incentives. ### **Your job is to help others get promoted** Why do people buy software? They think it will help them save time, be better at their job, and ultimately get promoted. If you, as a [finance leader](https://www.financealliance.io/top-10-cfo-skills/), approach your interactions with the rest of the organization with this mindset, you can find creative ways to help them succeed. Your first move should always be to make people *want* to do the thing you want them to do. As a CEO, I have the stick of telling someone to work elsewhere, but that is always the last resort. If that's the first tool I reach for, I’m a pretty bad CEO. ## **Demystifying AI's current role in financial analysis** AI is here, but its impact on FP&A is not as profound as you might expect. Yet. To understand why, you need to understand how the technology works. Large language models (LLMs) like ChatGPT are generative pre-trained transformers. They’re trained to predict the next word or token based on the vast amount of text on the internet. ### **Understanding how LLMs actually work** Imagine a model trained only on single-digit addition. At first, it memorizes that 1+1=2\. But if you expand that to nine-digit numbers, the model can't possibly memorize every combination. It has to learn the *concept* of addition to predict the right answer. This is why LLMs feel so smart; they are learning concepts and relationships. The takeaway is that they are good at things humans are good at, like reasoning and language, and not so good at things we aren't, like complex mental math. [Unlocking the potential of AI in financeTransforming finance leadership: Embrace AI for growth and innovation![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-216.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/DO-NOT-OVERRIDE-PMA_Webinar_Meta_Template_--9--2.png)](https://www.financealliance.io/unlocking-the-potential-of-ai-in-finance/) ### **The limitations of AI in forward-looking strategy** The most economically productive uses of AI today are in areas like accelerating engineering and automating customer support. It’s also good at [automating workflows](https://www.financealliance.io/fp-a-automation/) like reading invoices for accounts payable. It is not yet good at creating a new company strategy or building a complex financial model from scratch. It doesn't have the context you have, and the data it was trained on is different from the specific nuances of your business. It’s mostly marketing today, but that will change rapidly in the next year or two. ### **Practical ways to leverage AI now** So, how are CFOs actually using AI? It is fairly good at financial analysis. It can find variances in your actuals in an automated way. It can also be a powerful tool for learning. You can use it to get an intuitive sense of how different parts of the business work. I even built a GPT called Universal Primer, which is designed for speed-learning complex topics. It breaks things down with analogies and recursively explains prerequisite concepts until you understand the main idea. This kind of personal education is one of the best uses of AI for any leader today. [How AI is transforming financial modeling & sales forecasting in enterprise techThis article explores how AI is transforming financial modeling and sales forecasting (two pillars of enterprise strategy) and helping finance teams shift from reactive to proactive operations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-217.png)Finance AllianceSupreeth Meka![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--56--1.png)](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) ## **The future of finance and the human element** If you draw a line from where finance has been to where it's going, the trend is clear: it will become more strategic, more data-driven, and more deeply embedded in every function of the company. ### **The trajectory toward a fully embedded function** Just as [data and analysis](https://www.financealliance.io/financial-charts-and-graphs/) are now part of how every department works, finance will become part of everyone's job. In a few years, we should live in a world where a designer or engineer can talk about how their work impacts margin and growth two years down the line. New tools will break down the walls and enable this [collaboration](https://www.financealliance.io/how-wayfair-made-me-rethink-everything-i-knew-about-finance/). ### **Why human intuition and judgment will become more valuable** As AI becomes powerful enough to make better decisions than humans in many domains, we will face a societal-level choice. Do we allow AI to make decisions autonomously, or do we insist on a human-in-the-loop? I believe we will always want a human to sign off. This means the intuition, experience, and judgment of humans will remain the most valuable skill. Tools that help us hone that intuition will become even more critical. In a world where an AI can beat any human at Go, we still watch humans play because we value the human story and the human struggle. [Why human skills are the future of financeAs AI transforms finance, it’s not just about tech, it’s about people. Discover why emotional intelligence, curiosity, and leadership are the real future skills that will set you apart.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-218.png)Finance AllianceDaniele Martins![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--61-.png)](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) ## **The truth about modern finance** This brings me to a few myths about finance that need to be smashed. 1. **Finance isn't transparent.** This is a tooling problem. Finance leaders *want* people to understand how the business works. They hesitate to share a spreadsheet because someone might fat-finger a formula, and there’s no version control. Better tools solve this. 2. **Finance is about accounting.** [Accounting](https://www.financealliance.io/fp-a-vs-accounting-key-differences-every-finance-pro-should-know/) is about accounting. Finance is about the business. It’s about everything. Every action in a company falls to the bottom line, and the role of finance is to make that connection clear. 3. **Finance isn't technical.** This is increasingly untrue. Finance now owns data, builds complex simulations, and must be fluent in the technology that powers the modern enterprise. These stereotypes are unfair and are already rapidly becoming outdated. As leaders, it's our job to embrace this evolution, leverage new technologies, and build a more collaborative and [strategic future](https://www.financealliance.io/how-to-use-a-driver-based-forecast-to-drive-strategic-initiatives/) for finance. --- *Join our* [*community of finance leaders*](https://www.financealliance.io/community/) *where you can share ideas, get answers to all of your questions, look at job openings or match with a potential hire, and so much more.* [Join the Finance Alliance Slack CommunitySign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today! Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-219.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Meta_Images_Slack-Community-1-3.jpg)](https://www.financealliance.io/community/) ### The rise of AI in FP&A: What you need to know URL: https://www.financealliance.io/ai-in-fp-a/ Last updated: 2025-10-01T12:08:26.000Z Artificial intelligence (AI) is transforming the way we approach financial planning and analysis (FP&A). Now, before you envision robots taking over your job, *relax*. That’s not happening! AI in FP&A *won’t* make you or your role obsolete. But it *will* help automate routine tasks and give you more time for strategic initiatives. Keep reading to find out how. ## **What is AI in FP&A?** AI in FP&A involves using artificial intelligence to help better plan and analyze your company's finances. AI can take over repetitive and mundane tasks, letting [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) teams focus on providing key insights to help make smarter business decisions. Sure, automated software isn't exactly ground-breaking. But the latest AI can tackle those tasks even faster and with fewer errors than before. The rise of user-friendly AI chatbots like [ChatGPT](https://www.financealliance.io/chatgpt-for-excel/), [Google’s Gemini](https://www.financealliance.io/how-to-use-gemini-ai-with-google-sheets/), and [Microsoft’s Copilot](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) have made AI easily accessible to pretty much anyone - *including* FP&A professionals. These chatbots can perform routine tasks like data retrieval and analysis very well. Not only that, but companies are even building specialized chatbots that are designed to aid finance teams with a multitude of tasks. So, if you’ve been waiting to give AI a try, now might be a good time to reconsider. ![](https://media.tenor.com/3mx2o9IrQeUAAAAC/maybe-robert-downey-jr.gif) On another note, [Gartner’s research](https://www.gartner.com/en/finance/topics/finance-ai) found that **64%** of finance organizations using AI said it either ‘*met or exceeded their expectations*’. Some might say that’s strong evidence of AI’s potential to transform FP&A for the better! ## **Benefits of embracing AI for FP&A** ### **1\. Data-driven decisions, not guesses** AI unlocks hidden trends and relationships within financial data, providing valuable insights that would otherwise remain buried. These insights help companies make better-informed decisions backed by data, not just intuition. ### **2\. Risk management on autopilot** AI can constantly scan your data for potential problems like risks or anomalies. This proactive approach helps you catch risks early and avoid big losses before they happen. Think of it as putting [risk management](https://www.financealliance.io/financial-crime-risk-management-fcrm/) on autopilot (*kind of*)! ### **3\. Real-time scenario planning** AI in FP&A allows for dynamic [scenario modeling](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/), which means you can explore various possibilities and make informed choices based on simulated outcomes. This lets teams make faster decisions, uncover hidden opportunities, and avoid risks before they become problems. ### **4\. Reduced human error** Manual data entry and calculations are prone to human error. AI in FP&A automates these processes and reduces the risk of errors that can skew financial analysis. This means your financial data is more accurate and you can trust it to make good decisions. ### **5\. Efficient workflows** [Statista’s 2024 survey](https://www.statista.com/statistics/1419945/main-ai-benefits-financial-services/) found that nearly half **(43%)** of companies using AIin financial services saw a big boost in operational efficiencies. This isn’t surprising if you consider how AI tackles repetitive tasks like data entry with incredible speed. [Navigating the trifecta: Growth, sustainability & complianceHow finance leaders can harness AI, automation, and business insight to drive growth, manage risk, and stay relevant in a changing world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-220.png)Finance AllianceParul Goel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--78-.png)](https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/) ## **Calculating ROI for conversational AI chatbots** Calculating the ROI of a conversational AI chatbot isn’t just a numbers game, but also about connecting technology investment to real business outcomes. Here’s a framework you can use to make your case to leadership or stakeholders who want to see the value spelled out. Start by identifying your baseline: What are your current costs for customer service? This includes salaries, training, infrastructure, and even the opportunity cost of long wait times or unresolved queries. Next, estimate the chatbot’s impact on these costs. For example, [many banks see a reduction](https://www.financealliance.io/ai-in-risk-management-how-banks-can-mitigate-fraud-and-financial-crimes/) in call center volume (sometimes by 20-40%) as chatbots handle routine inquiries. That’s direct cost savings in labor and overhead. But don’t stop there. Consider efficiency [metrics](https://www.financealliance.io/32-cfo-kpis/) like average handling time (AHT), first contact resolution, and call deflection rates. If your chatbot deflects 30% of calls and reduces AHT by 15%, you’re not just saving money, you’re freeing up human agents for higher-value conversations. Now, layer in customer experience metrics. Net Promoter Score (NPS) and Customer Satisfaction (CSAT) often improve when customers get instant answers, 24/7. These intangible benefits (brand loyalty, [reduced churn](https://www.financealliance.io/how-fp-a-teams-calculate-and-reduce-customer-churn/), and positive word of mouth) can be just as valuable as hard cost savings. Finally, calculate your total ROI: (Total Benefits - Total Costs) / Total Costs x 100%. Be sure to factor in implementation, integration, and ongoing maintenance costs for a realistic picture. And don’t forget to revisit your assumptions regularly. AI evolves quickly, and so do customer expectations. This approach grounds your ROI analysis in both tangible (cost savings, efficiency gains) and intangible (customer loyalty, brand reputation) benefits. It’s about proving value and also about building a business case for [innovation](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) that resonates with both finance and customer experience leaders. ## **Common AI challenges in FP&A** Thinking about [using AI for your company's finances](https://www.financealliance.io/copilot-vs-claude-for-excel-which-ai-assistant-wins-for-formula-building/)? There are some bumps you might encounter along the way, so it's good to be aware of them beforehand. According to the [Global AI Adoption Index](https://filecache.mediaroom.com/mr5mr%5Fibmnewsroom/191468/IBM%27s%20Global%20AI%20Adoption%20Index%202021%5FExecutive-Summary.pdf), the top three barriers to AI adoption back in 2021 were: - *Limited AI expertise or knowledge *(39%)** - *Increasing data complexity and data silos *(32%)** - *Lack of tools or platforms for developing AI models *(28%)** Some of these barriers remain true today. However, the most pressing challenge nowadays is related to concerns over [data integrity and security](https://www.financealliance.io/cfo-cybersecurity/). FP&A teams deal with *a lot* of sensitive financial data and the last thing they want is a data breach. When FP&A uses AI to make forecasts and analyses, this data needs to be shared. However, sharing data like this can make it a target for hackers or lead to accidental leaks. Companies need to be very careful about how they protect this data while still using AI. Data integrity is another major concern when it comes to AI in FP&A. Data must be accurate and reliable but as the saying goes, ‘garbage in, garbage out’ and AI is only as good as the data it's fed. Poor quality or biased data can lead to inaccurate predictions and misleading analysis. Ensuring clean, reliable data is paramount for successful AI implementation in FP&A. ## **Security and compliance challenges of conversational AI in finance** When it comes to implementing conversational AI in finance, security and compliance are more than checkboxes: they’re critical pillars that can make or break your project. Financial institutions are held to some of the highest standards in data privacy and regulatory compliance, and conversational AI introduces new complexities that demand careful attention. First, let’s talk about data privacy. Chatbots interact directly with customers, often handling sensitive information like account numbers, transaction details, and personal identifiers This means your AI solution must comply with regulations such as GDPR, CCPA, and local banking laws. Data residency, consent [management](https://www.financealliance.io/5-change-management-strategies-finance-transformation/), and the right to be forgotten aren’t optional, they’re mandatory. Any slip can lead to hefty fines and reputational damage. Then there’s KYC (Know Your Customer) and AML (Anti-Money Laundering) compliance. Conversational AI must be designed to authenticate users securely and flag suspicious activities in real time. This requires robust integration with your existing [security](https://www.financealliance.io/stop-payment-fraud-before-it-starts/) infrastructure, including multi-factor authentication, encrypted data transmission, and continuous monitoring for anomalies. Don’t overlook auditability and explainability. Regulators increasingly expect AI systems to provide transparent decision-making trails. Your chatbot should log all interactions and decisions, making it easy to reconstruct conversations if needed for compliance reviews or dispute resolution. Mitigating these risks starts with a security-by-design approach. Involve compliance officers and CISOs early, conduct regular [risk assessments](https://www.financealliance.io/risks-of-mergers-and-acquisitions/), and partner with vendors who adhere to industry standards like ISO 27001 and SOC 2\. Ongoing employee training and penetration testing are also key best practices. Ultimately, successful implementation hinges on balancing innovation with rigorous oversight. By embedding security and [compliance](https://www.financealliance.io/finance-and-compliance/) into every phase of your conversational AI project, you’ll not only protect your organization, but you’ll also build trust with your customers and regulators. ## **Types of AI technologies & use cases in finance** There are lots of different types of AI technology specially designed for finance, each bringing something unique to the table. Below, you'll find some more information about different forms of AI (*as included in our* [*AI in Finance eBook*](https://www.financealliance.io/ai-in-finance-ebook/)), along with some examples of how each technology is used in finance. ![AI in FP&A - generative AI](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/Ai-in-finance-generative-AI.png) ![AI in FP&A -machine learning](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/AI-in-FP-A-machine-learning.png) ![AI for FP&A - deep learning](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/Ai-in-corporate-finance-deep-learning.png) ![AI for FP&A - neural networks](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/AI-for-FP-A-neural-networks.png) ![artificial intelligence in finance - NLP](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/AI-in-FP-A-natural-language-processing.png) ![AI in FP&A - RPA](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/robotic-process-auto.png) ## **Best AI tools for finance and FP&A** The fusion of AI in FP&A and finance has been nothing short of transformative. AI is reshaping how financial professionals analyze data, identify patterns, and make predictions. But what are the best AI tools for finance and FP&A? Here are just a few options on offer: ### **OpenAI ChatGPT** OpenAI's ChatGPT, a conversational AI, can be a robust tool for finance professionals. Beyond just answering queries, it can assist in data extraction, summarizing financial reports, and providing insights into data and complex financial terminologies. With ChatGPT, finance teams can streamline communications, get instant clarifications on financial matters, and even enhance customer-facing interactions, offering real-time responses to financial queries. ### **Microsoft Copilot** Finance isn't just about numbers; it's about making informed decisions based on those numbers. Microsoft Copilot combines the power of large language models (LLMs) with your data and is designed to alleviate the burden of mundane tasks, enabling users to focus on more fulfilling and creative aspects of their work. This tool can be integrated seamlessly into Microsoft applications such as Word, Excel, PowerPoint, Outlook, and Teams. ### **Booke.ai** Automation in bookkeeping is the future, and Booke.ai is leading the charge. This AI-driven platform simplifies the tedious task of financial record-keeping. This means reduced manual entry errors, faster reconciliation processes, and seamless integration with existing financial systems. By adopting Booke.ai, financial departments can ensure accuracy, save time, and focus on more strategic financial planning and analysis. ### **Nanonets** If you’d like to put a variety of finance and business processes on autopilot, Nanonet might be the ideal tool for you. Nanonets is an AI-driven platform specialized in automating data extraction from various document types. Its machine-learning capabilities enable it to recognize and process patterns, making it invaluable for businesses inundated with paperwork. It simplifies tasks like invoice processing, receipt tracking, and financial document management. By leveraging this tool, you can accelerate your workflows, reduce manual errors, and ensure consistent data accuracy. ### **Domo** Domo stands out as a business intelligence tool that amplifies the power of data across an organization. It promises to help you move from basic charts and graphs to data experiences that fuel real insights and action when it matters most. With intuitive dashboards and robust integration capabilities, Domo ensures that professionals from various departments, including finance, can seamlessly connect and interpret vast datasets. As a result, businesses can harness the potential of their data, identify trends, and optimize strategies for growth. ## **Steps to implement AI in FP&A: A visual** ![Steps to implement AI in FP&A](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/AI-in-FP-A-steps.png) ## **Why FP&A needs to embrace AI** A massive [**61% of finance leaders**](https://www.gartner.com/en/newsroom/press-releases/2023-11-07-gartner-says-most-finance-organizations-lag-other-functions-in-ai-implementation#:~:text=The%20survey%20of%20130%20finance,in%20the%20initial%20planning%20phase) haven't yet adopted AI, according to a recent survey from Gartner. > *“Despite AI’s potential, most finance functions’ AI implementations have remained limited...* > *“As they begin to chart out a plan for how best to prioritize that additional investment, CFOs should partner with their finance leadership teams to compare their current progress against their peers’ and identify concrete recommendations from early adopters on how best to accelerate AI use in their function.”* \- [**Marco Steecker**](https://www.gartner.com/analyst/bec003bb7b?)**, Senior Principal in the** [**Gartner Finance Practice**](https://www.gartner.com/en/finance)**.** While other departments like HR, IT, and legal, are embracing AI and reaping its benefits, FP&A teams seem to be lagging behind. But here's the good news: this presents a *huge* opportunity if you want to get ahead. By embracing AI, you can transform your role and reduce time spent on mundane tasks. More importantly, AI in FP&A can help you become a strategic partner to the business, with the time and tools to unlock deeper insights and guide your company towards a profitable future. --- ## **FAQs** ### **Will FP&A be replaced by AI?** No, AI is unlikely to completely replace FP&A. Instead, it will automate many of the routine and time-consuming tasks currently handled by FP&A professionals. This will free them up to focus on more strategic aspects of [financial planning](https://www.financealliance.io/10-big-picture-financial-planning-steps/), like analysis, interpretation, and providing insights to leadership. ### **Will FP&A be automated?** Yes, a significant portion of FP&A tasks involving [data collection](https://www.financealliance.io/data-cleaning-techniques/), consolidation, and basic forecasting are being automated by AI. This will allow FP&A professionals to dedicate their time and expertise to higher-level activities. ### **How is AI used in financial planning?** AI is used in financial planning in several ways including automating tasks, advanced forecasting, risk management, and scenario planning. ### **Is AI coming for financial advisors?** Don’t worry, AI won't replace financial advisors, but it can augment their capabilities. AI-powered tools can help financial advisors personalize investment strategies, manage portfolios more efficiently, and provide clients with 24/7 access to basic information. However, the human touch will still be crucial for tasks requiring empathy, complex financial planning, and building trust with clients. ### **What skills do I need to succeed in an AI-powered FP&A world?** While technical skills related to AI tools are helpful, the soft skills remain essential. Critical thinking, communication, and the ability to translate complex data into actionable insights will be highly valued as AI handles the routine tasks. --- ### FP&A Certified Core course Join the ranks of elite financial professionals with our [FP&A Certified Core course](https://certified.thealliance.io/course/fpa-certified-core ). Designed for those aspiring to make a significant impact in their organizations, this course offers deep dives into financial modeling, forecasting, budgeting, reporting, and more. As you progress, you’ll unlock the secrets to crafting compelling financial narratives that influence decision-making at the highest levels. Start your journey to becoming a certified FP&A expert today and build the career you've always wanted. [Sign up today](https://certified.thealliance.io/course/fpa-certified-core ) ### 10 tips from a CFO to navigate budgeting and planning with confidence URL: https://www.financealliance.io/surviving-budget-season-strategic-planning/ Last updated: 2025-09-29T09:28:15.000Z Finance leaders know the drill: budget season feels endless, yet the plan becomes outdated as soon as the new fiscal year begins. The chaos of economic volatility, investor expectations, and shifting priorities doesn’t make it any easier. In this report, **Russell Lester, President & CFO at Tropic**, shares a **10-step survival guide** for budget season. Drawing from decades of experience leading high-growth companies, he outlines practical, CFO-tested steps to help you scale efficiently, cut through the noise, and turn planning into a true strategic advantage. No jargon. No endless spreadsheets. Just a clear framework for making this budget season your most effective yet. ## **What this eBook will help you master** This isn’t a theoretical playbook, it’s a hands-on guide you can apply immediately. Here’s what you’ll walk away with: - Kick off strategic planning the right way, starting with mindset, not numbers. - Build a bulletproof budget baseline and avoid costly oversights. - Set data-driven financial targets that balance ambition and reality. - Identify revenue, expense, and resource gaps *before* they derail your plan. - Keep your plan alive all year with proactive execution and operating cadences. > *"How a company spends money is directly tied to where it’s placing its bets. As finance leaders, our job is to ensure those bets reflect strategy, not noise."* > — Russell Lester, President & CFO, Tropic ## **Is this eBook for me?** If you’re a finance leader facing another round of planning, this guide is for you. You’ll learn how to: - Cut through the noise and focus on what actually drives growth. - Treat spend management as a strategic advantage, not just cost control. - Spot hidden leaks in your budget (like overlapping SaaS spend) before it’s too late. - Secure stakeholder alignment and avoid endless revision cycles. - Build a plan that adapts and scales all year long. Budget season doesn’t have to feel like survival mode. With the right framework, it’s your opportunity to lead with clarity, data, and foresight. [Get your free copy](https://share-eu1.hsforms.com/1seFtgFTyRISpbsiU%5FPrmPQ2b1vun) ### API-first core banking systems: Engineering for security, scalability, and compliance URL: https://www.financealliance.io/api-first-engineering-for-security-scalability-and-compliance/ Last updated: 2025-09-29T09:12:11.000Z ## **A new core banking imperative** The era of strategic debate in bank IT is over. For years, the move towards modular architectures was driven by the need to compete with digital challengers on speed and elastic economics. Today, that [competitive advantage](https://www.financealliance.io/navigating-uncertainty-why-agile-fp-a-is-your-competitive-edge/) has been cemented into a non-negotiable regulatory baseline. With the Financial Conduct Authority's (FCA) operational resilience deadline having [passed](https://www.sidley.com/en/insights/newsupdates/2025/01/uk-operational-resilience-rules-are-you-ready-for-31-march-2025) in March and the EU's Digital Operational Resilience Act (DORA) now fully applicable, the theoretical risks of legacy monoliths have become tangible compliance liabilities. The core demand from regulators is no longer just for efficient audit trails, but for provable resilience, the verifiable ability to withstand disruption and execute rapid change without downtime. The architectural pattern required to meet this new reality is clear and has become mission-critical. Exposing each core banking domain – ledger, Know Your Customer (KYC), payments, crypto – through a version-controlled API and running it as an independent microservice is no longer just a winning formula for innovation; it is the mandated blueprint for survival and compliance in modern [finance](https://www.financealliance.io/17-finance-business-processes/). [How financial services firms can protect against AI fraudNearly 70% of Americans say they would pay more for services that offer stronger protections, and 83% believe financial institutions should be doing everything possible to protect them from fraud.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-208.png)Finance AllianceGreg Bohl![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight.png)](https://www.financealliance.io/how-financial-services-firms-can-protect-against-ai-fraud/) ## **What “API-first” really means in practice** Translating the strategic imperative for resilience into day-to-day reality hinges on a set of core engineering disciplines. This is how leading firms are implementing an API-first model that satisfies both competitive and [regulatory demands](https://www.financealliance.io/finance-and-compliance/). ### **1\. Contract-first development** The process begins with the API contract, not the code. Before implementation starts, teams define and publish a formal specification for their service using standards like OpenAPI for REST APIs or AsyncAPI for event-driven systems. This discipline enables fully parallel development across the organisation, as teams can build and test against a stable, published contract. It also "shifts security left," allowing for [automated](https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/) validation of the API design against security policies before a single line of application code is written. ### **2\. Gateway-centric, zero-trust security** Security is unified and enforced at a single ingress point: the API Gateway. This eliminates the scattered, inconsistent controls that plague legacy systems. Every request is forced through a central chokepoint that handles authentication and authorisation (e.g., OAuth 2.0), enforces encrypted transport (mTLS), applies rate limiting to prevent abuse, and generates unified, structured logs. This gateway-centric model is a practical implementation of a zero-trust architecture, dramatically simplifying [security](https://www.financealliance.io/stop-payment-fraud-before-it-starts/) management and audit. ### **3\. Elastic and isolated domains** Each microservice functions as an independent, elastic domain that scales horizontally based on its specific demand. This operational isolation is critical for resilience. A massive spike in payment processing during a holiday season, for example, will have zero performance impact on unrelated services like customer onboarding (KYC) or treasury operations. The result is both greater stability and significant cost efficiency, as [resources are allocated](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) only where and when they are needed. ### **4\. Auditability by design** To meet today's stringent compliance demands, [auditability](https://www.financealliance.io/liquidity-in-defi-market-makers-amms-and-the-hybrid-future/) must be an inherent feature of the architecture. In this model, every API call is stamped with a unique trace-ID that persists across every service it touches, creating an immutable, end-to-end transaction log. This is essential for demonstrating ongoing compliance with the cyber-risk and traceability mandates now in full effect, including FINMA's circular 2023/1, the EU's MiCA framework for crypto-assets, and the FCA's comprehensive operational resilience rules. ## **Why it matters for security, scalability, and compliance** ### **Security** Centralised authentication and end-to-end encryption shrink the attack surface. More importantly, the mandatory trace-ID on every request transforms threat analytics, shifting SIEM and fraud detection from a reactive forensic exercise to a proactive, real-time capability essential for meeting FINMA's stringent incident-response mandates. ### **Scalability** Because services are loosely coupled, a spike in real-time payments or KYC checks can be scaled horizontally without dragging down the [whole stack](https://www.financealliance.io/driving-digital-transformation-in-finance/). This operational isolation provides both critical resilience against unpredictable loads and the business agility to pursue new market opportunities without risking core platform stability. ### **Compliance** Immutable logs provide irrefutable, end-to-end proof of any transaction's journey, transforming [compliance](https://www.financealliance.io/navigating-the-trifecta-growth-sustainability-compliance/) into a continuous, demonstrable state. This capability is the prerequisite for passing FINMA’s rigorous outsourcing and cyber-risk audits; satisfying the now-enforced crypto traceability rules under MiCA; executing the mandatory resilience tests for DORA; and efficiently fulfilling data-subject requests under GDPR. [What is a compliance report: A guide on compliance reportingA clear, no-fluff guide to compliance reporting for finance teams who do it all.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-209.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/compliance-report-blog-meta-2-2.png)](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) ## **Case studies in action** The proof for this new architectural paradigm is not found in forward-looking white papers, but in the measurable outcomes already achieved by a diverse range of financial institutions and [technology](https://www.financealliance.io/why-black-box-ai-is-failing-fp-a-and-what-to-use-instead/) providers. - [**ANZ Bank**](https://www.anz.com.au/personal/) provides the classic enterprise transformation story: by retiring a legacy ESB in favour of an API gateway, it cut latency, improved governance and met open- banking mandates without a core-replacement “big bang”. - [**Avaloq**](https://www.avaloq.com/), though older, shows that an incumbent can evolve: by wrapping its wealth-grade functionality in modern APIs and integrating METACO for crypto custody, it keeps Swiss private banks compliant while they modernise gradually. - [**FinRay**](https://finray.tech/) (CoreBanq + BitKonto) show what happens when crypto and fiat run on the same API-first ledger: banks reconcile both asset classes in real time, while built-in KYC/KYB workflows and webhooks generate audit artefacts automatically. Deployment is flexible – SaaS, private cloud or a perpetual on-prem licence – so evenSwiss or EU institutions that demand local control can adopt it without waiving sovereignty. - [**SaaScada**](https://saascada.com/) illustrates the power of an event-sourced ledger; its immutable journal lets product managers reconstruct any customer position at any historical instant – ideal for embedded-finance brands that want real-time analytics but no infrastructure burden. - [**Skaleet**](https://skaleet.com/en) proves speed: a digital bank in Africa launched on its event-driven SaaS core in four months and scaled past 800,000 accounts while halving operating cost. - [**Thought Machine (Vault Core)**](https://www.thoughtmachine.net/vault-core) demonstrates ultimate product agility: banks write smart-contract scripts to model anything from green mortgages to ESG-linked deposits. Tuum balances breadth and control, offering deposits, lending and cards in modular micro-services that a bank may run in its own Kubernetes cluster for data-residency compliance. [Why we switched to Payhawk: How we streamlined spend & closed fasterLearn why we moved to Payhawk - reducing fees, automating approvals, and making month-end faster with real-time ERP sync.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-210.png)Finance AllianceChristopher Reed![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--76-.png)](https://www.financealliance.io/why-we-switched-to-payhawk/) ## **Industry insight** Across RFPs since 2023, one pattern is clear: banks no longer ask if they should go API-first – they ask how soon and with which partner. SaaS-only players such as Mambu, Skaleet and SaaScada win on raw launch velocity; licence-flexible newcomers like Tuum and FinRay win where regulators or strategy demand local hosting (on-premise); ultra-configurable toolkits such as Thought Machine attract banks that are ready to write code for differentiation. What unites all winners is the non-negotiable trio of uniform APIs, micro-service boundaries, and exhaustive observability. ## **The benefits – and the costs we must acknowledge** ### **1.Distributed system fallacies** Moving from one process to dozens of networked services invites latency, eventual-consistency headaches and cascade failures. A bug in a [pricing](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/)\-engine pod can freeze user-facing balances. *Mitigation*: adopt circuit-breakers, bulk-head patterns, idempotent commands and automated chaos drills. Service meshes (Istio, Linkerd) plus SLO-driven autoscaling contain blast radius yet preserve the elasticity advantage. ### **2\. Observability is hard** “Exhaustive observability” is not a plug-in; it is an engineering programme. Banks need distributed tracing (OpenTelemetry → Jaeger), centralised logs (Elastic or Loki) and [metrics](https://www.financealliance.io/32-cfo-kpis/) (Prometheus → Grafana) just to match monolithic insight levels. *Benefit*: once instrumented, anomalies surface in seconds; DORA’s incident-reporting SLA becomes achievable. *Cost*: new [skills](https://www.financealliance.io/top-10-cfo-skills/), pipelines and on-call culture. ### **3\. Security is a trade-off, not a silver bullet** A gateway removes password sprawl, but you now police hundreds of endpoints. Every route must be schema-validated, penetration-tested and shielded from business-logic abuse. *Mitigation*: zero-trust network segmentation, automated API-spec fuzzing, short-lived JWTs, and continuous red-teaming (TIBER-EU now aligned with DORA RTS). *Benefit*: granular scopes let you shut a compromised domain without killing the bank. ### **4\. The human factor** Technology is the easy part. *Organisational restructuring*. API-first thrives on autonomous “domain teams” owning code-to-production. That clashes with project-bureaucracy cultures. *Mitigation*: start with a single product line, prove end-to-end ownership, then expand; measure on customer outcomes, not project milestones. Benefit: faster, safer releases. *Skill gap.* COBOL and waterfall give way to Go/Kotlin micro-services, GitOps and SRE. Retraining is multi-year and costly. *Mitigation*: pair in-house bankers with cloud-native hires; sponsor certifications; embed an SRE guild; outsource commodity services to buy learning time. *Benefit*: once reskilled, teams automate toil and innovate continuously. ### **5\. The immutable-ledger paradigm shift** Streaming every posting as an event log up-ends double-entry habits. IFRS and Basel III reports must be rebuilt on projections, not mutable tables. *Mitigation*: layer CQRS projections that emit familiar trial balances while retaining the audit-proof event store. *Benefit*: instant reconciliation, rollback-free reversals, and MiCA-grade crypto audit trails. ## **Best-practice blueprint** 1. **Publish the contract before the code.** Treat OpenAPI/AsyncAPI as the single source of truth and wire compliance tests to the spec. 2. **Gate everything.** A unified gateway should own auth, quotas, schema validation and logging; nothing talks to a service directly. 3. **Scale by domain, not by stack.** Break out payments, KYC, FX, crypto, lending so each can autoscale independently. 4. **Stream the ledger.** Emit every posting as an immutable event; feed it to data-lineage warehouses that drive IFRS, Basel III and MiCA reports without ETL gymnastics. 5. **Version relentlessly.** Semantic-version every API and automate backward- compatibility tests so feature teams can ship weekly without fear. 6. **Drill for DORA.** Chaos-test the micro-services and gateways; rehearse recovery to regulator-mandated RTO/RPO so auditors sign off in hours, not weeks. ## **Conclusion (and what’s next?)** API-first is no longer aspirational; it is the present tense of core banking. Design around the contract, audit every call, and let each micro-service scale at its own rhythm, and security reviews shrink while regulator sign-offs become routine. **Next up: MCP AI – a model-centric policy engine that sits atop those well-instrumented APIs.** It devours new FCA circulars, EU DORA RTS, MiCA rulebooks and FINMA cyber guidance overnight, predicts capacity-breach windows from your Prometheus feeds, and flags suspicious API patterns before the SOC sees them. In short, API-first gives the bank its data exhaust; MCP AI turns that exhaust into autonomous compliance, predictive resilience, and a fresh sprint of innovation. --- *Join our* [*Finance Alliance Slack community*](https://www.financealliance.io/community/) *to start making new connections and expand your CFO network. You'll be able to share your ideas, get answers to all your questions, discover new talent, and so much more.* [Join the Finance Alliance Slack CommunitySign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today! Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-211.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Meta_Images_Slack-Community-1-2.jpg)](https://www.financealliance.io/community/) ### How to create a budget allocation plan (plus 13 tips) URL: https://www.financealliance.io/tips-to-allocate-budget-across-departments/ Last updated: 2026-01-28T16:41:47.000Z ## **What is budget allocation?** [Budget](https://www.financealliance.io/flexible-budget-performance-report/) allocation is the process of dividing your company’s financial resources between departments. As you can imagine, it can be a tricky process to get right. Everyone wants a bigger piece of the pie, and you can’t always please everyone. Your main goal is to make sure each department has the funds it needs to operate effectively, while aligning spending with the company’s overall priorities. You need to consider three main factors when determining how to allocate available funds: **1\. Company priorities** (what you need to spend money on to achieve the company’s goals) **2\. Revenue projections** (how much you can realistically spend) **3\. Departmental needs** (every department submits requests outlining their operational costs such as software, marketing campaigns, equipment, etc.) Knowing how much each department can spend helps everyone stay on track and spend responsibly. So, how can you develop a budget plan that meets different department needs while supporting your company's overall goals? **Continue reading to learn:** - [Budget allocation plan (meaning and definition)](https://www.financealliance.io/tips-to-allocate-budget-across-departments/#what-is-budget-allocation) - [The meaning of ‘allocation amount’](https://www.financealliance.io/tips-to-allocate-budget-across-departments/#what-does-allocation-amount-mean) - [Why it’s important to have a budget plan](https://www.financealliance.io/tips-to-allocate-budget-across-departments/#why-companies-need-a-budget-plan-benefits) - [How to create a budget allocation plan ](https://www.financealliance.io/tips-to-allocate-budget-across-departments/#how-to-create-a-budget-allocation-plan)(step-by-step) - [Who’s usually responsible for budget management](https://www.financealliance.io/tips-to-allocate-budget-across-departments/#who-is-responsible-for-budget-management) - [13 tips to allocate budget across departments](https://www.financealliance.io/tips-to-allocate-budget-across-departments/#13-tips-to-allocate-budget-across-multiple-departments) - [Budget allocation FAQs](https://www.financealliance.io/tips-to-allocate-budget-across-departments/#budget-allocation-faqs) ## **What is a budget allocation plan?** Allocating the budget isn’t as simple as writing a number on a piece of paper (or in an email) and handing it over to each head of department. You have to put those numbers somewhere; preferably, in a well put-together budget allocation plan. A budget allocation plan clarifies how much the company can spend on a product, event, or person, etc. Your plan should clearly [outline available funding](https://www.financealliance.io/how-to-effectively-fundraise-and-find-investors/) and designate which individuals or departments can access those funds. Budgets are used for two distinct purposes: 1. **Financial planning and control** Budgets help companies forecast income and expenses, which helps them to allocate resources effectively, avoid unnecessary spending, and identify potential [financial risks](https://www.financealliance.io/financial-crime-risk-management-fcrm/) *before* they become problems. 1. **Performance measurement and evaluation** By comparing actual results to the budget, companies can track their progress towards financial goals, identify areas where spending needs to be adjusted, and hold different departments accountable for [responsible financial management](https://www.financealliance.io/financial-accountability/). ## **What does the allocation amount mean?** The allocation amount refers the predetermined sum of money assigned to a particular department, project, or expense. Let’s break it down to help put it into perspective in context of a company budget… So, first let’s think of the company budget as the overall financial plan for the company. It's where everyone looks to see the [expected income and planned expenses for a specific period](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) (usually a year). When we talk about ‘allocation’ in this context, we’re referring to the act of dividing the total budget into smaller portions for specific purposes. Finally, the ‘allocation amount’ is the **specific dollar value** assigned to each portion. Pretty simple, right? It basically tells you exactly how much money each business unit can spend within the broader company budget. This leads to improved financial control and better resource planning across departments. ## **Why companies need a budget plan** **(benefits)** [50% of failed start-ups](https://www.failory.com/blog/startup-failure-rate) didn’t have a clear budget for their business when they launched, which underscores the important role of budget plans in a company's success. It won’t come as a surprise to learn that *most* businesses have limited budgets. As much as you’d like to give every department the freedom to spend as much as they want, that's just not realistic. Budgets force departments to prioritize their needs and allocate resources efficiently. Without them, costs can spiral out of control and lead to overspending. Some more reasons why budget allocation is so important include: - Financial control - Optimal resource use - [Risk mitigation](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) - Strategic alignment - [Operational efficiency](https://www.financealliance.io/business-process-optimization/) - Performance evaluation Without clear financial direction, you risk spending way too much on things like office supplies (*guilty!*) or you might misallocate resources altogether. Skipping a budget plan isn’t something you should be prepared to do, especially if you want to keep your business running successfully. If you do have an issue with overspending, it might be time to get on top of your company’s spend control. You need to know how other departments spend company money. To get that information, you need visibility over who’s spending money and how they’re spending it. However, only [31.3% of companies](https://www.spendesk.com/blog/spend-control/) believe they have good visibility while 40% have no clear idea of how money is spent. To help improve spending visibility and keep everything in order, you need to create a budget allocation plan. So, let’s get into it. ## **How to create a budget allocation plan** A budget allocation plan provides a structured framework for distributing financial resources across a company’s departments, divisions, projects, and other entities. If you want to create a strong budget plan, focus on making sure it’s: - **Realistic:** Don't set yourself up for failure with impossible numbers. - **Transparent:** Everyone on the team should understand the financial picture. - **Professional:** Treat your budget as a strategic plan for success. Alright, now let’s cover the steps to help you create a budget allocation plan from scratch: ### **1\. Get to grips with your company’s strategic objectives** You’ll need to [collaborate closely with the CEO](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/) and other key stakeholders to make sure the budget aligns with the company’s strategic goals. So, try to open discussions to identify top priorities, such as [growth initiatives](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/), market expansion, product development, or efficiency improvements. By understanding these main goals, you can create a budget that better supports the [company's vision](https://www.financealliance.io/cfo-mission/) for the future. ### **2\. Analyze past spending** Sometimes you have to look back to move forward and that’s definitely the case when it comes to creating a defined budget plan. By reviewing historical budgeting data, financial statements, and [performance metrics](https://www.financealliance.io/32-cfo-kpis/), you can categorize them into direct and indirect costs. This will help you identify areas for potential savings, set realistic spending limits, and identify areas where financial performance can be improved. [Is your budget timeline holding you back?Tired of waiting for other departments to submit inputs to the budget on time? Here’s a few tricks of the trade to help you prevent this issue and create seamless budget timelines.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-98.png)Finance AllianceChristian Wattig![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--36--2-2.png)](https://www.financealliance.io/budget-timelines/) ### **3\. Conduct financial forecasting** Develop financial forecasts that include revenue, expenses, cash flow, and [capital expenditures](https://www.financealliance.io/multiple-on-invested-capital-moic/). Use both quantitative data and qualitative insights from market trends and industry analysis to inform these forecasts. This is an important step to help you anticipate potential roadblocks (like unexpected expenses) and make informed decisions about resource allocation. ### **4\. Consult department heads** Building a budget or spending allocation model that works for everyone isn’t a one-person job. You’ll have a much easier time (and create a better plan), if you seek insights from your department heads. Chat with them about their financial needs and priorities. This will help you to see things from their perspective. For example, the marketing team might need more resources to launch a new campaign, while the sales team might be looking for ways to streamline their operations. By working together, you can create a budget that addressed departmental challenges, which will help you allocate resources more effectively. From there, you may employ a certain **budgeting methodology** such as: ![Different types of budget allocation](https://lh7-us.googleusercontent.com/bPcSQVqnQ3iCpe55_rpoT9cVBo3sHkR3C1tWrx7kaMWkorKxQ2JE6XA_kZF7nSM53FtAthLszC0_7liXI3l_c9kK3ggT1LAutxLl6gPKqgKudixENOCwy2ucV1celjfG2_3xHzPfbGqjBnKp_dhCX3w) ### **5\. Create preliminary budget proposals** With the strategic goals clear and department needs in mind, it's time to start building the budget! A good way to begin is by creating initial proposals that act like a first draft of the financial plan. These proposals detail how resources will be allocated *across* the company. You essentially break it down for [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/), showing how much money will be designated for different functions and specific projects within each department. These initial proposals are just the starting point, but they act as a foundation for further discussion and refinement before finalizing the official budget plan. ### **6\. Assess risk and adjustments** You can’t predict everything, but you can be prepared. This step involves looking at potential risks, such as economic downturns, market instability, or changes in regulatory landscapes, and adjusting the budget to help mitigate these risks. For example, you could incorporate contingency plans in case certain risks materialize and focus on [creating a flexible budget](https://www.financealliance.io/flexible-budget-performance-report/) that you can adapt as needed in response to changing circumstances. Once you’ve assessed risks and made initial adjustments, the real test of your budget allocation plan often comes from how well it adapts to change. Dynamic budget reallocation is about staying nimble, shifting resources as new information, challenges, or opportunities arise. In practice, this means you’ll need to establish clear triggers and thresholds that prompt a review or reallocation of funds. So, what counts as a trigger? Common examples include a sudden [revenue shortfall](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/), unexpected expenses (think: a major equipment breakdown), or significant market shifts, like a competitor launching a disruptive product. Even positive surprises, such as an unanticipated sales spike, can prompt a reallocation to capitalize on momentum. Setting thresholds is about defining the point at which action is required. For instance, you might decide that if actual revenue drops more than 5% below forecast, or if a department exceeds its budget by 10%, it’s time to revisit allocations. Some organizations [automate](https://www.financealliance.io/fp-a-automation/) these alerts, while others rely on regular review meetings. The key is to make these thresholds explicit and agreed upon in advance so everyone knows when, and why, the plan might change. Here’s a quick example: Imagine your marketing budget is set for the year, but halfway through, a new competitor enters the market and your sales pipeline slows. If your trigger is a 7% drop in quarterly sales, you’d convene a review and potentially shift funds from lower-priority projects to high-impact marketing campaigns. This approach ensures your budget isn’t static, but it’s a living tool that helps you respond to real-world shifts, not just plan for them. ### **7\. Finalize and approve the budget** It’s go time! … *(or is it?)* When you’ve taken time to incorporate feedback, you can finalize the budget plan and present it to the leadership team and the board for feedback and approval. Your [presentation](https://www.financealliance.io/how-color-impacts-your-finance-presentations/) should be clear and concise. So, try to stay on topic and explain why you’ve allocated resources the way you have. It helps if you can back up your decisions with data and showcase how the budget aligns perfectly with the company's goals. ### **8\. Implement the budget** Once approved, you’re ready to work with the rest of your finance team and department heads to implement the budget. To make this go as smoothly as possible, make sure everyone understands their allocated budget amounts, which will help them keep within spending limits. It’s also important to be ****transparent**. Explain the reasoning **behind* the budget allocations and be open to answer any questions that may follow. ### **9\. Monitor the budget plan** Keep a close eye on the performance of your plan over the first few months following its execution. You might find that some are experiencing difficulties with keeping within the budget. If this happens, take time to assess the situation and be open to the possibility that the plan may need some changes. When monitoring your allocation budget, focus on areas like: - **Spending:** How much money is being spent in each department compared to their allocated amounts. - **Deviations:** If there are any significant differences between planned and actual spending, you should investigate why. - **Course correction** (if needed): Based on your findings, you might need to adjust spending or make changes to the budget. ### **10\. Adjust your budget allocation plan** There might be times when you need to adjust the budget throughout the year. This is why it’s important to create a budget that’s flexible, which means you can adapt it easily without uprooting the entire thing. By being able to adjust the budget, you can respond to changes and stay ahead of the curve. ## ***Who* is responsible for budget management?** Typically, [budget management](https://www.financealliance.io/3-key-pain-points-in-budgeting/) involves multiple roles and stakeholders within an organization, such as: - **CFO** \- The Chief Financial Officer is ultimately responsible for high-level budget strategy, [financial planning](https://www.financealliance.io/10-big-picture-financial-planning-steps/), and oversight of the overall budget. This holds true across multiple industries with[ McKinsey](https://www.mckinsey.com/~/media/McKinsey/Business%20Functions/Strategy%20and%20Corporate%20Finance/Our%20Insights/Strategy%20and%20corporate%20finance%20special%20collection/Final%20PDFs/McKinsey-Special-Collections%5FRoleoftheCFO.ashx) reporting that **72% of CFOs** say they're the *most involved* executives in allocating financial resources. - **Finance department** \- The finance team manages day-to-day budget tracking, reporting, analysis, and controls. They also develop budget allocation models and processes. - **Department heads** \- Leaders of business units are involved in budget requests, planning, and managing budgets for their departments. - **Controller** \- The controller plays a key role in budget control and variance analysis and often enforces compliance with budgets. - **Budget analysts** \- Analysts assist with budget [forecasts](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/), data analysis, and preparation of budgets. - **Project managers** \- Project leads maintain budgets for specific projects and initiatives. - **Executives** \- The CEO, COO, and other executives weigh in on high-level budget direction aligned to business strategy. While the CFO may be the ultimate budget owner, effective budget management requires collaboration across these different roles to develop, track, control, and optimize budget performance. After you’ve mapped out departmental allocations, it’s time to consider a crucial safeguard: the emergency fund. Building an emergency reserve into your budget isn’t just a best practice, it’s a lifeline when the unexpected strikes. Whether it’s a sudden drop in revenue, a regulatory fine, or a global event that disrupts operations, having dedicated reserves can mean the difference between resilience and crisis. So, how do you weave an emergency fund into a standard allocation model? Start by defining a target reserve (often a percentage of [annual operating expenses](https://www.financealliance.io/financial-charts-and-graphs/); say, 5–10%). This isn’t a static figure; it should be reviewed annually and adjusted based on risk appetite, industry volatility, and recent experience. Next, treat the emergency fund as a non-negotiable line item, just like payroll or rent. Allocate it at the start of the budgeting process, not as an afterthought. Some organizations create a central reserve managed by finance, while others distribute mini-reserves to departments with higher risk exposure. Here’s a practical template: If your annual operating budget is $2 million, you might earmark $150,000 (7.5%) as an emergency reserve. This amount sits in a separate account, untouched unless a predefined trigger (such as a 15% revenue drop or a major system failure) occurs. Department heads know the criteria for accessing these funds, and requests are reviewed by a cross-functional committee to ensure transparency and discipline. Integrating emergency funds in this way not only protects your organization but also fosters a culture of preparedness. It’s a proactive move that reassures stakeholders and gives you, as a finance leader, the confidence to navigate uncertainty because you’ve planned for the unpredictable. [How FP&A Teams Build Budgets?Asif Masani breaks down budgets step-by-step, not just so you understand it, but so you can confidently explain it in your next FP&A interview.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-207.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--66--3.png)](https://www.financealliance.io/how-fp-a-teams-build-budgets-and-how-you-can-nail-this-in-interviews/) ## **13 tips to allocate budget across multiple departments** Here are 13 tips for effectively allocating budget across multiple departments. ### 1\. Involve department heads early in the budgeting process Have them provide input on their resource needs and strategic priorities. This buy-in helps to create shared ownership. ### 2\. Employ a standardized approach Implement a [standardized budgeting process](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) throughout the company to maintain consistency and fair allocation while considering each department’s unique needs. ### 3\. Analyze historical spending Search spending history to help identify trends and seasonal fluctuations. Use this data to forecast future budget needs. ### 4\. Set organization-wide goals and communicate strategic priorities Departmental budgets should align with these overarching objectives. This alignment not only ensures financial coherence but also enhances operational synergy. ### 5\. Tie budgets to realistic forecasts Allocate the budget in the context of revenue projections, not last year's numbers. By aligning budgets with realistic forecasts, you’ll ensure a more adaptive and forward-looking [financial strategy](https://www.financealliance.io/podcast/scalable-growth-strategy/) positioned to navigate through evolving market conditions and emerging challenges. ### 6\. Reserve a percentage of the total budget for discretionary spending This buffers against unforeseen expenses arising mid-year. Reserving some of the budget for a rainy day could prove to be vital for mitigating risks and safeguarding against financial strain. ### 7\. Prioritize ROI-driven activities Allocate more significant budget portions to departments or projects that exhibit higher Return on Investment (ROI), ensuring funds are applied in areas that create value. ### 8\. Require departments to justify requests exceeding historical allocations Scrutinize large variances before approving. This helps ensure that any significant deviations from past spending are thoroughly vetted and aligned with strategic objectives. ### 9\. Stage budget distributions Granting each department funds quarterly or monthly versus upfront. This improves oversight. Plus, allocating budgets in installments rather than lump sums allows closer monitoring of spending patterns and burn rates. ### 10\. Establish policies on budget transfers between departments Policies that allow flexibility while maintaining control enable resources to be shifted to higher-priority needs when necessary. ### 11\. Compare the allocated budget to actual spending and hold department heads accountable Regular check-ins on budget versus actuals reveal if departments are lagging or outpacing their plan. It’s also important to hear from department heads so that actuals vary from the budget by higher than expected, they can explain, and you can analyze root causes together. ### 12\. Leverage technology Implement budget management software and analytical tools to streamline the allocation process. If done right, technology can help ensure accurate tracking, and provide actionable insights that inform future allocations. ### 13\. Review budgets regularly Continually track budget usage against set benchmarks and revisit allocations if company priorities shift mid-year. Revising budgets is one of the biggest priorities of modern-day CFOs according to[ PwC](https://www.pwc.com/us/en/library/executive-leadership-hub/cfo.html), who say CFOs prefer to work closely with colleagues across the C-suite to adjust budgets and revisit pricing models. As organizations look to streamline and future-proof their budget allocation processes, automation is quickly moving from a nice-to-have to a must-have. Why? Because automated tools can help you spot anomalies, generate reports in real time, and even suggest reallocations based on live data. That means less time spent on manual reconciliation and more time for strategic decision-making. Let’s take a quick look at how three leading solutions stack up when it comes to automation, reporting, and integration: | Software | Automation features | Reporting and insights | Integration capabilities | | ----------------- | --------------------------------------------- | -------------------------------------- | --------------------------------- | | Adaptive Planning | Automated scenario updates, anomaly detection | Real-time variance analysis, forecasts | Connects with major ERPs, APIs | | Anaplan | Workflow automation, predictive modeling | Custom dashboards, scenario planning | Integrates with CRM, ERP, HRIS | | Oracle, NetSuite | Automated allocations, AI-driven alerts | Built-in analytics, compliance tools | Native ERP suite, open connectors | For example, Adaptive Planning’s anomaly detection can “produce a predicted forecast” and flag out-of-step numbers instantly, saving you from tedious end-of-cycle reconciliations (as one finance professional shared in a recent discussion). Anaplan shines with its predictive modeling and flexible workflow automation, while Oracle NetSuite brings robust [AI-driven](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) alerts and seamless integration within its broader ERP ecosystem. The real differentiator? It often comes down to how these platforms handle real-time data and how easily they plug into your existing tech stack. If you’re looking for [conversational AI](https://www.financealliance.io/copilot-vs-claude-for-excel-which-ai-assistant-wins-for-formula-building/), some tools now offer chatbots that help you analyze variances or generate cheat sheets for department leads, making finance more accessible across your organization. Ultimately, the right fit depends on your size, complexity, and appetite for automation; but the options have never been more powerful or user-friendly. --- ### Budget allocation FAQs What does allocation amount mean when budgeting? In budgeting, the allocation amount refers to the specific sum of money designated for a particular purpose or department within a company. This amount is determined based on expected costs and strategic goals, guiding how financial resources are distributed. How to avoid over allocating departmental budgets? To prevent over-allocating departmental budgets, it helps to start with accurate financial forecasts and prioritizing resources based on company objectives. What does allocation method mean? The allocation method in budgeting describes the specific criteria and processes used to distribute available financial resources among various departments or projects. How do you allocate a budget effectively? Allocating a budget effectively involves understanding organizational goals, evaluating past expenditures, and forecasting future needs. You need to strike a balance between strategic priorities and available resources to make sure every dollar supports the overall business goals. What is the basic budget allocation? The basic budget allocation typically involves dividing funds among essential categories such as operations, capital expenditures, personnel, and marketing. The exact categories depend on the business's nature and strategic priorities. What is a budget allocation model? A budget allocation model is a framework used to decide how funds should be distributed within an organization. It includes methodologies and principles guiding financial decisions, often incorporating factors like historical data, business objectives, and expected returns. How should a budget be set up? Setting up a company budget involves defining financial goals, estimating revenues, forecasting expenses, and allocating resources across departments. A budget is essentially a strategic plan that guides fiscal management over a specified period. What is budget resource allocation? Budget resource allocation is the process of assigning financial resources to different areas within a company to achieve optimal use and support business objectives effectively. How to allocate money in a budget? Allocating money in a budget requires analyzing each department's needs, the company's strategic goals, and expected income. Funds should be distributed to ensure operational efficiency and foster growth in key areas. What is the best allocation method? The best allocation method depends on the specific needs and strategy of the organization. However, activity-based costing (ABC) is widely regarded for its accuracy in assigning costs based on actual activities, providing a more detailed understanding of resource utilization. --- ### Improve your budgeting skills with FP&A Core: Certified Join the ranks of elite financial professionals with our [**FP&A Certified Core course**](https://certified.thealliance.io/course/fpa-certified-core). Designed for those aspiring to make a significant impact in their organizations, this course offers deep dives into financial modeling, forecasting, budgeting, reporting, and more. As you progress, you’ll unlock the secrets to crafting compelling financial narratives that influence decision-making at the highest levels. Start your journey to becoming a certified FP&A expert today and build the career you've always wanted. [Sign up today](https://certified.thealliance.io/course/fpa-certified-core) ### Taking the BS out of buying SaaS URL: https://www.financealliance.io/taking-the-bs-out-of-buying-saas/ Last updated: 2025-11-25T14:38:49.000Z **30% of software renewals hit in Q4, just as finance and procurement teams are already at their breaking point.** But renewing SaaS doesn’t have to mean: - Bad surprises hiding in contracts - Bloated proposals and specs you don’t need - Pushy sales reps taking advantage of tight deadlines With the right playbook, you can negotiate smarter, renew faster, and save money, without the gimmicks. --- ### What you’ll get in this session This live session with **Tropic** is built for finance and procurement pros who want to take control of renewals, not just react to them. Tropic’s procurement leaders will walk you through the exact tactics they use every day to: - Spot and eliminate last-minute contract surprises before they hit your des - Push back on inflated proposals and bloated specs with confidence - Focus your time where it matters most to get renewals done faster - Apply insider negotiation tactics to secure the best terms without the gimmicks - Build a repeatable renewal process you can rely on quarter after quarter --- ### Meet the experts [**Michael Shields**](https://www.linkedin.com/in/shieldsmichaeld/) *VP, Procurement* With deep experience leading global procurement teams across industries, Michael is passionate about elevating the role of procurement in the tech sector. At Qualtrics, he built a respected procurement organization from the ground up, driving innovation while delivering measurable financial impact. [**Jacob Leichtman**](https://www.linkedin.com/in/jacob-leichtman/) *Senior Director, Procurement Services* Jacob's led Tropic's negotiation services and strategic advisory function for nearly 5 years. He specializes in streamlining complex vendor negotiations and eliminating procurement pain points for growing companies. [**Mandy McGovern**](https://www.linkedin.com/in/mandy-mcgovern/) *Regional Manager, Commercial Executive* Mandy's spent 4 years cutting through the noise in SaaS buying at Tropic. She oversees Security, Engineering, and Data Analytics contracts, helping teams navigate vendor relationships without the usual headaches. --- ### About Tropic Tropic is your intelligent procurement partner, built to help modern finance and procurement teams save time, reduce costs, and drive results. Backed by $15B+ in software spend intelligence, Tropic delivers the visibility, automation, and leverage you need to turn procurement into a competitive advantage. Learn more at [tropicapp.io](https://tropicapp.io). ### Dialing back in: How financial services firms can protect against AI fraud crisis URL: https://www.financealliance.io/how-financial-services-firms-can-protect-against-ai-fraud/ Last updated: 2025-09-22T11:42:29.000Z When OpenAI CEO Sam Altman warned of the looming AI Fraud Crisis, it served as a wake-up call to banks and other [financial](https://www.financealliance.io/) institutions increasingly using or considering digital voice ID to authenticate customers – an approach that could open the door for [fraudulent money transfers and significant account losses](https://www.financealliance.io/ai-in-risk-management-how-banks-can-mitigate-fraud-and-financial-crimes/). At the banking regulatory conference hosted by the Federal Reserve, Altman stated, "I am very nervous that we have an impending, significant fraud crisis”, before underscoring the urgency of the crisis, “…some bad actor is going to release it – this is not a super difficult thing to do. This is coming very, very soon”. ## **AI fraud crisis, a multi-faceted challenge** AI isn’t solely a risk to bank customers’ personal and business account funds. It is also negatively impacting the ability of financial institutions to engage with customers, protect their brand reputation, and maintain trust in the critical voice channel. ### **Engagement challenge** Seventy-two percent of Americans [refuse](https://tnsi.com/resource/com/research-confirms-financial-consumer-demand-for-branded-calling-ebook/) to answer phone calls from numbers they don’t recognize. This is a very real problem for banks and other financial organizations, not only to engage with customers efficiently but also to protect them from scammers spoofing legitimate brands. Despite the widening trust gap and value of delivering an [omnichannel experience](https://www.financealliance.io/15-tools-for-a-great-finance-tech-stack/), consumers still want to engage via the voice channel. 64% of adults still prefer to engage with their financial services provider via a phone call over any other method (text messaging, apps, website). Financial services firms are ‘high-touch’ organizations that depend on outbound [communications](https://www.financealliance.io/stakeholder-communication-plan/) to engage customers, verify identities, complete applications, share policy and account updates, and confirm appointments. But with more customers screening and declining unidentified calls, these crucial updates often don’t reach the intended target, leading to delays in customer service. [Fraud detection in 2025: Lessons from a decade in the trenchesLearn more about fraud detection and explore lessons to help companies stay secure in the face of persistent threats.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-204.png)Finance AllianceMaxim Filatov![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--55--1.png)](https://www.financealliance.io/fraud-detection-in-2025-lessons-from-a-decade-in-the-trenches/) ### **Technology challenge** There is a direct correlation between the erosion of bank [customer trust](https://www.financealliance.io/fp-a-business-partner/) in the voice channel and the threat of scams. Our own recent survey finds nearly three-quarters (74%) of Americans feel there has been a rise in robocall scams posing as trusted banks and credit unions. In some cases, [empowered by AI](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/), bad actors are creating more sophisticated scams by generating realistic voices or spoofing phone numbers to impersonate financial institutions, making it difficult for Americans to distinguish legitimate calls and texts from fraudulent ones. The proliferation of [AI-generated](https://www.financealliance.io/excels-game-changing-copilot-function/) robocalls has not only increased the volume of scams but also made it easier for bad actors to make these scams more convincing. 63% of US adults have either experienced or know someone who received an AI-generated deepfake robocall. ### **Brand protection challenge** Financial institutions often leverage real-time outreach via the voice channel to communicate potential fraud attempts, verify identities, and better serve their customers. Robocall bad actors are aware of this routine and exploit it, ultimately making it difficult for customers to discern legitimate calls from nefarious ones. Placing the call authentication burden on the customer exposes them to financial fraud and also poses a significant risk to the bank’s reputation if scams are successful. In one high-profile case, a [Chase Bank](https://www.cnbc.com/2023/02/06/phishing-as-a-service-kits-drive-uptick-in-theft-one-business-owners-story.html) customer lost over $120,000 from his checking account. He received a call from an 800 number that matched Chase’s customer service, asking to verify a suspicious transaction. He was prompted to log in to his account through a secure link sent via text message. From there, the bad actors captured his login information and stole funds. ## **Regulators and policymakers dial in** The Federal Trade Commission (FTC) has taken several preventative measures to address AI scam risks, such as finalizing a rule in 2024 to combat impersonation of [governments and businesses](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/). It also launched a voice cloning challenge aimed at developing ideas to protect consumers by detecting and halting the misuse of voice cloning software by unauthorized users, according to the FTC. The FTC is not the only regulatory body to take action against AI voice and text robocalls. Following a a highly publicized deepfake impersonation of President Biden during the 2024 primary season, the Federal Communications Commission (FCC) immediately ruled that AI-generated voices in robocalls were illegal under the Telephone Consumer Protection Act. The ruling authorized the FCC and state attorneys general to pursue legal action under TCPA if AI was detected in scam calls. ## **Emerging alternatives to voice authentication** As bad actors become more sophisticated with AI tools and spoofing [technologies](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/), digital voice identification is no longer a sufficient line of defense. Banks and other financial services firms must shift towards a **more holistic authentication strategy** that incorporates: ### **Deliver inbound call transparency** By including more critical call information – the institution’s name, logo, and reason for calling – directly on the recipient’s phone screen, [banks](https://www.financealliance.io/risks-of-manual-banking-processes-a-guide-for-modern-finance-treasury-teams-ebook/) can ease the burden on customers to play private investigator on whether or not the call is legitimate. It also increases their likelihood that customers will confidently engage with the call: nearly two-thirds (66%) of Americans will answer a [branded](https://www.financealliance.io/podcast/creating-harmony-across-the-enterprise-as-a-finance-leader/) call from their financial services provider, and 58% would be more comfortable sharing personal information over such a call. ### **Invest in call authentication and spoof protection** Call authentication ensures that only verified, branded calls are delivered to customers, blocking any unauthenticated or spoofed calls in real-time. Finally, by identifying and stopping spoofed calls before they reach their customers, financial institutions eliminate the risks of brand impersonation, shield their customers and maintain the integrity of their communications. [The secret to effective communication with the C-suiteIf you’ve ever wondered how finance can evolve from gatekeeper to strategic partner, this article offers the blueprint. You’ll get real-world takeaways on building influence, navigating complex stakeholder dynamics, and driving value without losing your voice.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-205.png)Finance AllianceNick Quiroz![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/wayfair-3.png)](https://www.financealliance.io/how-wayfair-made-me-rethink-everything-i-knew-about-finance/) ### **Proactively protecting against inbound risks** Scammers are not focusing exclusively on using fraudulent calls to target customers. Increasingly, they are attempting to trick and manipulate IVRs and call agents into releasing personal customer account information. Banks should therefore focus on a zero trust policy that includes three lines of defense to eliminate inbound threats: 1. Voice firewalls to manage inbound calls by blocking or redirecting spam and spoofed calls as well as protecting against Telephone Denial of Service (TDoS) attacks; 2. Risk assessment for each call, providing enhanced security screening to verify customer identity; 3. Detection of synthetic and cloned voices to eliminate any AI-based voice call from reaching the intended end-user. As consumers grow more aware of scams, they expect financial services firms to do more to protect them. Nearly 70% of Americans say they would pay more for services that offer stronger protections, and 83% believe financial institutions should be doing everything possible to protect them from fraud. Securing the voice channel from AI threats is the foundational step forward for financial services firms to enhance their customer experience and grow their bottom line. --- ### **Author bio** *Greg Bohl is the Chief Data Officer for TNS’ Communications Market business and is responsible for leading its data science and analytics strategy.* *In this role, he ensures the company is maximizing the value of the data assets associated with its trusted services, including its voice spam filtering and mobile call authentication, branded calling, mobile roaming and inter-carrier connectivity.* --- Join our [network of finance professionals](https://www.financealliance.io/community/) to get advice and share your thoughts, make new connections and expand your network, and find your next career opportunity. [Join the Finance Alliance Slack CommunitySign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today! Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-202.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Meta_Images_Slack-Community-1-1.jpg)](https://www.financealliance.io/community/) ### How to forecast inventories as an FP&A pro so that you balance working capital and growth URL: https://www.financealliance.io/how-to-forecast-inventories/ Last updated: 2025-09-15T08:47:20.000Z In this guide I walk you step‑by‑step through practical inventory [forecasting](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) techniques you can apply today using Excel. If you [work in FP&A](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/) or run a small retail business, these methods will help reduce stockouts, avoid excess inventory, and free up cash tied to slow‑moving SKUs. ## Why forecasting fails (and how to fix it first) [Forecasting problems](https://www.financealliance.io/3-cash-flow-forecasting-challenges/) usually come from messy data and not from bad software. Forecasting errors of 30% are common when your spreadsheet contains duplicates, missed promotion flags, or inconsistent date periods. Before you run any forecast, do this three‑step cleanup: 1. Gather 6–12 months of sales history for each SKU. 2. Remove or adjust one‑time spikes (bulk orders, giveaways, data errors). 3. Convert all data to consistent periods (weekly or monthly). Clean [data](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/) converts noisy sales numbers into a reliable trend—the starting point for every forecast. ## Method 1: Moving average (simple, explainable) Use moving averages for steady sellers. It smooths random fluctuations and is easy to explain to [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/). Example: January = 100, February = 120, March = 110. A 3‑month moving average = (100 + 120 + 110) / 3 = 110 units. In Excel use the AVERAGE formula. ![Article content](https://media.licdn.com/dms/image/v2/D4D12AQHTpNEJ84QdEw/article-inline_image-shrink_1000_1488/B4DZi26AIqG8BM-/0/1755415320861?e=1761177600&v=beta&t=s_rlzhLFPgWXat-ANzCEj7sR2x-IrnhHqtZR7e5wS8c) Pro: simple and stable. Con: it lags sudden changes and misses seasonality. ## Method 2: Exponential smoothing (more responsive) When demand shifts month‑to‑month, exponential smoothing reacts faster by giving more weight to recent observations. Choose a smoothing factor alpha (0–1). A higher alpha makes the forecast more responsive; a lower alpha makes it smoother. Conceptually: forecast ≈ (weight\_recent × most\_recent\_sales) + (weight\_previous × previous\_sales). For example, with alpha = 0.2 you place more weight on the latest data and less on older points. ![Article content](https://media.licdn.com/dms/image/v2/D4D12AQEMIFX2FTABcA/article-inline_image-shrink_1000_1488/B4DZi26W5PHsBQ-/0/1755415414768?e=1761177600&v=beta&t=RfO1Ys36YoyZbpq2Iht4F4_DIeFUjfUaAW6PF5GDX5A) Use exponential smoothing for SKUs that show gradual shifts or short‑term [trends](https://www.financealliance.io/9-upcoming-trends-that-ransforming-fp-a/) where you want the forecast to adapt quickly. ## Method 3: ABC analysis (prioritize your effort) If you stock dozens or hundreds of SKUs, not every item deserves the same [forecasting](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) effort. ABC analysis ranks SKUs by annual consumption value (units × unit cost), sorted from largest to smallest. - Category A: top \~70–80% of value. Tight forecasting (weekly), possibly exponential smoothing. - Category B: next \~15–25%. Moderate attention (monthly/quarterly). - Category C: remaining. Simple methods and infrequent reviews. ![Article content](https://media.licdn.com/dms/image/v2/D4D12AQG5va3qUuxRbg/article-inline_image-shrink_1000_1488/B4DZi26dX1GsAQ-/0/1755415440377?e=1761177600&v=beta&t=7BMhIlrhU7UAmjAtMvWz1MYD9Uo1S88oQvfklYulgRQ) In my sample data the top 4–5 SKUs account for \~89% of annual value. They get prioritized [forecasting resources](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). ## Method 4: Seasonality index (for predictable peaks) For seasonal items (e.g., air conditioners), adjust forecasts with a seasonality index. Steps: 1. Compute monthly averages for each month across multiple years (e.g., average of all Januarys). 2. Compute the overall average across all months and years. 3. Seasonality index for a month = (month\_specific\_average) / (overall\_average). 4. Forecast for a month = baseline average units × seasonality index for that month. ![Article content](https://media.licdn.com/dms/image/v2/D4D12AQH-DLXAntms4w/article-inline_image-shrink_1000_1488/B4DZi263MLHYAQ-/0/1755415545955?e=1761177600&v=beta&t=-Dq6z10MY5fOQiUmbRQa4KDf1CzSA15IpSqTpIlJVVI) Interpretation: Index = 1 is average; \>1 means above average demand (summer for ACs), <1 means below average. ## Safety stock, lead time and reorder point Forecasting tells you expected demand. But you must plan for [uncertainty](https://www.financealliance.io/navigating-uncertainty-why-agile-fp-a-is-your-competitive-edge/). Use safety stock to guard against demand spikes and supplier delays. Safety stock formula (one practical form shown here): Safety stock = (maximum daily sales × maximum lead time) − (average daily sales × average lead time). Example: Average daily sales = 15 units, maximum daily sales = 18 units, lead time = 10 days. Safety stock = (18 × 10) − (15 × 10) = 30 units. Reorder point = (average daily sales × lead time) + safety stock = (15 × 10) + 30 = 180 units. Also account for supplier constraints: minimum order quantities, shipping schedules, production caps, and cadence (weekly/monthly deliveries). ## Connecting sales → production → inventory Your inventory forecast is a node in a chain: - [Sales forecast](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) drives what you plan to sell. - Production forecast schedules what gets made. - Inventory forecasting balances the two so the right products are in the right place at the right time. If sales forecasts are too high you overproduce and tie up cash. If too low you underproduce and lose sales. The goal is to be close enough to avoid chronic overstocks or stockouts. ## Your FP&A inventory forecasting playbook 1. Start with clean data (6–12 months per SKU). 2. Use moving averages for steady sellers. 3. Upgrade to exponential smoothing for shifting demand. 4. Layer in ABC analysis to focus effort where it matters. 5. Apply seasonality index for predictable peaks. 6. Always calculate safety stock, lead times, and reorder points. --- Join the [Finance Alliance community](https://www.financealliance.io/community/) to network with other CFOs and finance leaders, get answers to all your questions, share insights, and grow your connections. [Join the Finance Alliance Slack CommunitySign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today! Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-201.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Meta_Images_Slack-Community-1.jpg)](https://www.financealliance.io/community/) ### Excel’s game-changing COPILOT function: Why my previous AI recommendations just changed URL: https://www.financealliance.io/excels-game-changing-copilot-function/ Last updated: 2025-09-19T09:15:33.000Z Deep learning models have revolutionized the field of [time series forecasting](https://www.financealliance.io/how-ai-forecasting-drives-smarter-financial-planning/), offering significant performance improvements over traditional methods. These models are particularly well-suited for handling complex temporal relationships and high-dimensional data. In this section, we'll introduce the basics of deep learning models and their applications in time series forecasting. [![AI Crystal Ball](https://tirabassi.com/wp-content/uploads/2024/01/AI.jpg "AI | Tirabassi.com")](https://tirabassi.com/an-ai-crystal-ball-how-we-predict-future-outcomes-using-a-temporal-fusion-transformer-model/) Microsoft just launched the revolutionary COPILOT function in Excel, bringing AI directly into spreadsheet cells. This changes everything I recommended in my previous [Copilot vs Claude](https://www.financealliance.io/copilot-vs-claude-for-excel-which-ai-assistant-wins-for-formula-building/) comparison. While Claude still excels for complex Power Query work, Excel’s new COPILOT function delivers the speed, flexibility, and native integration that transforms how we work with data, without requiring OneDrive auto-save. The COPILOT function is powered by a large language model and advanced AI model, enabling its generative and exploratory capabilities within Excel. Just weeks after publishing my analysis of Copilot vs Claude for Excel formula building, Microsoft dropped a bombshell that fundamentally changes the AI-in-Excel landscape. The new [COPILOT](https://www.financealliance.io/copilot-in-power-bi/) function is a complete reimagining of how artificial intelligence integrates with spreadsheets. Notably, COPILOT was initially tested as part of Excel Labs and the Excel Labs add in, and is currently available in a beta phase to a limited group of users as Microsoft continues to refine its features. In my previous comparison, I noted that while Copilot offered seamless integration, its limitations around auto-save requirements, slower response times, and limited formula alternatives made Claude the superior choice for advanced users. The new COPILOT function addresses these concerns head-on while introducing capabilities that neither tool previously offered. ## **What makes the COPILOT function revolutionary** Excel’s new Copilot function is an AI-powered tool that transforms AI assistance from an external chat interface into a native Excel function, working just like VLOOKUP, SUMIF, or any other formula. This new function allows you to replace traditional formulas by typing AI prompts directly into cells and getting instant results. Here’s the basic syntax: > \=COPILOT(prompt\_part1, \[context1\], \[prompt\_part2\], \[context2\], …) With this new function, users can enter a natural language prompt directly into a cell to interact with Copilot, making it easy to generate, classify, or analyze data without technical expertise. But the real magic happens when you see it in action. --- [Driving digital transformation in financeHow finance leaders can turn digital disruption into lasting competitive advantage.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-191.png)Finance AllianceJuan Ignacio Pascual![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--74-.png)](https://www.financealliance.io/driving-digital-transformation-in-finance/) --- ## **Data classification made effortless** Remember spending hours categorizing expense reports or customer feedback? The COPILOT function handles this instantly. It can also automatically classify data, such as survey responses or feedback, streamlining analysis. As demonstrated in Microsoft’s announcement video, you can analyze credit card descriptions and automatically generate expense categories: > \=COPILOT(“Analyze the credit card descriptions and come up with a short list of categories I can use to group the expenses”, B2:B50) Within seconds, COPILOT scans your data and proposes relevant categories. The function is context-aware, which means it understands your business context and tailors its suggestions accordingly, even incorporating common business naming conventions and merchant categories. ## **Data generation and content creation** One of the most impressive demonstrations shows COPILOT generating data it doesn’t already have in your spreadsheet. You can ask it to create lists of companies in specific industries, generate marketing keywords based on product descriptions, or even brainstorm project ideas - all directly within Excel cells. The COPILOT function can also spur ideas for new projects or marketing strategies, making it a valuable brainstorming tool. For example, you might ask: “*List the top 10 SaaS companies by revenue and their primary business focus*.” COPILOT pulls this information from its training data and creates structured output directly in your cells, something that previously required external research and manual data entry. Additionally, the function can be used to summarize feedback from customers or team members, providing quick insights for your analysis. ## **Formula explanations and how to reference cell values in plain English** The COPILOT function excels at demystifying complex formulas. Using the FORMULATEXT function, you can reference any formula in your spreadsheet and ask COPILOT to explain it in plain English: > \=COPILOT(“Explain this formula in plain English”, FORMULATEXT(D5)) This eliminates the guesswork when inheriting spreadsheets from colleagues or revisiting your own complex formulas months later. ## **Data analysis and insights from web and enterprise data** Perhaps most powerfully, COPILOT can analyze entire data ranges and provide intelligent summaries. The function generates the requested output based on the user’s prompt, delivering tailored insights. In:"stead of manually scanning profit and loss statements, you can ask COPILOT to analyze the data and highlight key findings: > \=COPILOT(“Analyze the profit and loss statement and give me a summary of notable points”, A1:C20) The function uses TEXTJOIN and CHAR functions to format responses with proper line breaks, creating readable paragraph-style outputs that feel more like analyst reports than formula results. --- [Driver-based forecasting for FP&A to align strategy with realityIf you haven’t tried driver-based forecasting for FP&A, this is your chance to really align your strategy with reality.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-192.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--73-.png)](https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/) --- ## **Data cleaning made simple** [Data cleaning](https://www.financealliance.io/using-chatgpt-for-data-cleaning/), historically one of the most tedious Excel tasks, becomes almost effortless. The demonstration shows COPILOT extracting ZIP codes from inconsistently formatted address data and then standardizing the formatting-tasks that typically require complex regex patterns or manual correction. **Important note for regular data processing**: While the COPILOT function excels at one-off data cleaning tasks, it’s not the optimal solution for repeated data cleaning exercises. If you regularly receive external reports that need the same cleaning steps applied each month or quarter, Power Query remains the superior choice. Power Query allows you to build reusable data transformation workflows that can be refreshed with new data automatically. Use COPILOT for ad-hoc cleaning tasks and exploratory data work, but invest in Power Query solutions for recurring data processing workflows. ## **How this changes my previous recommendations** ![](https://cfoproanalytics.com/wp-content/uploads/2025/08/1c7615d9-809a-47c4-bd8e-f70b390b74fa.png) The COPILOT function is future based, with ongoing improvements and new features expected as Microsoft continues to develop its AI capabilities. ### **Speed: The game changer** In my previous analysis, I criticized Copilot for slow response times compared to Claude. The COPILOT function operates at the speed of Excel’s calculation engine. This is made possible by Excel’s calculation engine, which ensures real-time updates and seamless integration with AI features like COPILOT. When your data changes, results update automatically, just like any other Excel function. This represents a fundamental shift from the slower chat-based interface to instant, native performance. ### **No more auto-save requirements** My biggest criticism of the original Copilot was its requirement for OneDrive auto-save, which forced a cloud-first workflow many users found restrictive. The COPILOT function works in any Excel file, whether stored locally, on network drives, or in the cloud. This addresses the primary concern that made Claude more appealing for users who prefer controlling their save workflows. ### **Integration vs. external tools** While Claude still requires copying and pasting between applications, the COPILOT function brings AI capabilities directly into the spreadsheet grid. Results become part of your workbook, automatically update when source data changes, and can be referenced by other formulas. By leveraging spreadsheet reference cell values, users can ensure that AI-generated results dynamically update in response to changes in specific cells or ranges. This level of integration was impossible with external AI tools. ### **Best practices for interpretation, not precision** Microsoft emphasizes an important limitation: the COPILOT function excels at interpretation, classification, and insights rather than precision mathematics. However, it may not always provide accurate numerical calculations, so manual validation is important for critical data. This aligns perfectly with how most users actually need AI assistance for understanding data patterns, categorizing information, and generating insights rather than performing complex calculations. ## **Updated recommendations: When to use what** ### **Choose Excel’s new Copilot function when:** - **Data classification tasks**: Categorizing expenses, customer feedback, or survey responses. - **Content generation**: Creating lists, brainstorming ideas, or generating structured data. - **Data analysis**: Summarizing trends, highlighting key findings, or explaining patterns. - **Formula explanations**: Understanding complex formulas built by others. - **Data cleaning**: Extracting information from messy text or standardizing formats. - **Working with files locally**: When you prefer not to use OneDrive auto-save. - **Single cell usage**: The COPILOT function can be used in a single cell for quick analysis or content generation. - **Internal data processing**: The function operates on internal data within the workbook. Ensure that current or internal data is referenced or imported for accurate results, as COPILOT cannot access live web or enterprise data. ### **Choose Claude when:** - **Power Query development**: The COPILOT function doesn’t work in Power Query editor. - **Complex M code**: Claude remains superior for data transformation scripting. - **Multiple formula alternatives**: When you want to see different approaches to the same problem. - **Cross-platform work**: When working across different applications beyond Excel. - **Educational depth**: When you need detailed explanations of Excel concepts and best practices. ### **Choose traditional Copilot when:** - **Conversational assistance**: When you prefer chat-based interaction for guidance. - **Template creation**: For generating entire workbook structures and layouts. - **Multi-step workflows**: When you need guidance through complex multi-stage processes. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-194.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FP-A-career-salary-and-path-2-7.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## **Formula and Syntax: How to write and use COPILOT** The COPILOT function in Excel introduces a new way to interact with your data—using natural language prompts directly in your spreadsheet. With this function, you can reference cell values, ask questions, and receive AI powered results, all within the familiar Excel environment. The basic syntax is straightforward: ``` =COPILOT(prompt_part1, [context1], [prompt_part2], [context2], …) ``` This structure allows you to combine your instructions (the prompt) with specific data from your worksheet (the context). For example, you might ask the copilot function in Excel to “Summarize the main points from these survey responses,” referencing a range of cells containing customer feedback. The function then processes your request and returns results right in your spreadsheet, making it easy to wrangle data, generate summaries, or classify information without leaving Excel. Whether you’re looking to analyze trends, brainstorm ideas, or automate repetitive tasks, the copilot function’s natural language interface makes it accessible to users of all skill levels. By blending AI with the power of Excel’s calculation engine, you can unlock new efficiencies and insights from your data. ## **Understanding the COPILOT formula structure** The structure of the COPILOT formula is designed for maximum flexibility and ease of use. You can mix and match prompts and context references to suit your specific needs. For instance, if you want to quickly categorize customer feedback, you might enter a prompt like “Classify this feedback” and reference a column of responses. The copilot function then analyzes each entry and outputs the classified results directly into your chosen cells. This approach eliminates the need to manually read, tag, or summarize large volumes of data. Instead, the copilot formula does the heavy lifting—making it ideal for tasks like customer feedback analysis, survey response categorization, and generating concise summaries from complex datasets. By leveraging the copilot function, you can focus on interpreting results and making decisions, rather than getting bogged down in manual data processing. ## **Practical examples for everyday tasks** The COPILOT function isn’t just for advanced users, it’s a productivity booster for everyday Excel tasks. In marketing, for example, you can use the copilot function to generate SEO keywords based on product descriptions, helping your team optimize content for better search engine visibility. For [financial reporting](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/), the function can quickly summarize large tables of existing data, making it easier to spot trends and prepare reports. Legal professionals can also benefit by using the copilot function to organize and classify information from lengthy legal documents, streamlining research and review processes. And if you need to create lists or tables from raw data, the copilot function can produce multi-row and multi-column outputs that fit seamlessly into your Excel spreadsheet. Whether you’re managing a marketing campaign, preparing financial statements, or handling internal business documents, the copilot function helps you work smarter and faster. ## **Customer feedback and development** The evolution of the COPILOT function is driven by real-world customer feedback. Microsoft actively encourages users to share their experiences and suggestions through the Microsoft 365 Insider program and built-in feedback tools within Excel. This ongoing dialogue ensures that the copilot function continues to improve, adapting to the needs of business users, analysts, and everyday spreadsheet enthusiasts. By listening to customer feedback, Microsoft can identify new features, address pain points, and enhance the overall user experience. This collaborative approach means that the copilot function is continuously improving, with updates and refinements that reflect the priorities and challenges of the Excel community. As more users adopt the copilot function, their insights help shape its future, ensuring it remains a valuable tool for data analysis, content generation, and decision support within the Microsoft 365 ecosystem. --- [Top finance events to attend 2025 | Finance Alliance2025 is set to be an exciting year with a range of finance events taking place around the world that offer opportunities to learn, network, and grow. Have your calendar ready as we drop the ultimate round-up of top finance events to attend in 2025.👇🏽![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-195.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Summit_Website_Article_Images_OnDemand-2.png)](https://www.financealliance.io/top-finance-events/) --- ## Real user stories and impact Hearing how real users apply the COPILOT function in their daily work brings its benefits to life. For example, a product manager might use the copilot function to analyze customer feedback on a new coffee machine, quickly surfacing common themes and suggestions for improvement. This enables the team to make critical business decisions based on data-driven insights, rather than gut instinct. In another scenario, a student working on a research project can use the copilot function to summarize complex survey responses, saving hours of manual analysis and allowing more time for interpretation and presentation. These stories highlight how the copilot function empowers users to tackle tasks that once required significant time and expertise. By sharing experiences and best practices, users not only help each other get more from the copilot function, but also contribute valuable feedback that drives its continued enhancement. Whether you’re in finance, marketing, education, or any field that relies on data, the copilot function in Excel is opening new possibilities for smarter, faster, and more informed decision-making. ## Availability and access: How to get started The COPILOT function is currently rolling out to specific user groups with specific requirements. Web users will soon be able to access the COPILOT function through Excel for the web as part of the broader Microsoft 365 ecosystem. ### Current availability: - **Beta Channel users** with Microsoft 365 Copilot licenses. - **Windows**: Version 2509 (Build 19212.20000) or later. - **Mac**: Version 16.101 (Build 25081334) or later. - **Web version**: Rolling out soon through Microsoft’s Frontier program. ### Usage limits: - 100 calls every 10 minutes. - Up to 300 calls per hour. - Single calls with larger data ranges count as one usage. By passing arrays, users can optimize usage and handle larger datasets efficiently within the function’s limits. - Dragging formulas across multiple cells counts as multiple calls. ### Licensing requirements: - Microsoft 365 Copilot license (typically $30/user/month for business) - OR Microsoft 365 Personal/Family subscription (Copilot now included as of January 2025) For business users, the COPILOT function requires the full Microsoft 365 Copilot license. However, as of January 2025, Microsoft included Copilot capabilities in Microsoft 365 Personal and Family subscriptions, making this functionality accessible to individual users through a monthly AI credit system. ## **The bottom line: A new era for Excel** The COPILOT function represents the most significant innovation in Excel since the introduction of dynamic arrays. It transforms AI from an external assistant into a native spreadsheet capability, addressing the primary limitations that made external tools like Claude more attractive for many use cases. The COPILOT function leverages advanced AI models and large language models to generate responses based on user prompts and referenced data, enabling natural language understanding and content generation within Excel. Unlike some external tools, the COPILOT function cannot access live web data directly, so users must import other data as needed for comprehensive analysis. Any input remains confidential and is not used to train or improve the AI models, ensuring user privacy and data security. This marks a significant shift from traditional tools like INDEX MATCH, as the evolution from formulas to AI-driven features is changing how data analysis is performed in Excel. For most users, this changes the AI assistance landscape entirely. The combination of native integration, automatic updates, local file support, and instant performance creates a compelling case for using Excel’s built-in AI capabilities over external alternatives. However, this doesn’t make external AI tools obsolete. Claude retains significant advantages for Power Query development, educational explanations, and complex analysis that requires multiple approaches. The ideal workflow now involves using the COPILOT function for day-to-day data manipulation and classification while leveraging Claude for advanced development work and learning. *As Microsoft CEO* [*Satya Nadella*](https://en.wikipedia.org/wiki/Satya%5FNadella) *noted:* > *“I just love this.” The COPILOT function feels like the natural evolution of what spreadsheet AI assistance should be-seamlessly integrated, contextually aware, and immediately useful."* The era of choosing between integration and capability is over. Excel now offers both. ### Your guide to building stronger cross-functional relationships URL: https://www.financealliance.io/your-guide-to-building-stronger-cross-functional-relationships/ Last updated: 2025-09-19T09:27:49.000Z In finance (especially in FP&A) we don’t own a P&L line the way sales or product does. What we *do* own is perspective. We have the models, the benchmarks, the insights, and most importantly, the ability to bring structure to decisions. But here’s the catch: insight alone doesn’t drive outcomes. To have impact, we need to shape a narrative that resonates with our partners and use that narrative to influence. That’s how finance becomes more than the “number crunchers” in the room, we become trusted advisors and decision-makers. In this blog, I’ll share a framework I’ve developed for doing just that: moving from analytics, to narrative, to influence. I’ll also cover some of the pitfalls I see new analysts fall into, and how to avoid them. ## **Why you need to tailor your narrative** The starting point for any narrative is knowing your audience. Too often we focus on *what we want to say*, not *what our audience needs to hear*. ![Tailoring your narrative](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/08/know-your-partners-better-and-tailor-your-narratice-for-maximum-impact.png) Every stakeholder comes with two defining traits: their **priorities** and their **depth of knowledge**. - **Executives**: broad scope, but shallow detail. They want the headline, the “so what,” and they want it fast. - **Managers**: balance of depth and scope. They need enough detail to understand drivers but don’t want to drown in data. - **Analysts/ICs**: deep experts in their corner of the business. They want to see the data, the methodology, and the steps you took. If you give executives 20 data slides, you’ll lose them. If you give an analyst just a headline, they’ll dismiss you. The art is [tailoring your narrative](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/) to the level of your audience. ## **The hypothesis-driven analysis approach** One mistake I see often (especially with new analysts) is diving straight into the dataset the moment they hear about a problem. They start pulling numbers, running pivots, and building models without stopping to frame the story first. The problem with this approach is twofold: 1. **You overwhelm yourself.** Datasets are messy and sprawling. Without a clear hypothesis, it’s easy to get lost in noise and lose sight of the real issue. 2. **Storytelling becomes harder.** If you start with raw data, you end up trying to stitch together a narrative after the fact. That often leads to a fragmented or overly technical presentation that doesn’t resonate with stakeholders. A hypothesis-driven approach flips this. Start by asking: *What’s the problem? What do we think might be driving it?* Then fetch and analyze the data to confirm or refine. This way, the data fills in the story you’ve already sketched, instead of leaving you scrambling to invent one afterward. The better way to approach this is with hypothesis-driven framework: ![Hypothesis driven analysis](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/08/hypothesis-driven-analysis-streamlines-the-process-and-focuses-on-solving-key-problem.png) 1. Define the problem. 2. Form a hypothesis about the cause. 3. Collect and analyze data to test that hypothesis. 4. Refine and repeat until the story is clear. Starting with a hypothesis prevents overwhelm, keeps you focused on solving the actual problem, and makes it much easier to connect the dots in your storytelling. --- [Storytelling with Data Visualization Playbook | Finance AllianceDiscover the essential components of a powerful data narrative and learn how to weave them together to create a story that resonates with your audience.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-188.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Storytelling_with_Data_Visualization_Blog_Meta_2-1.png)](https://www.financealliance.io/storytelling-with-data-visualization-playbook/) --- ## **Transforming data into actionable insights** Data is only the starting point. It’s not about *what the numbers say*; it’s about *what they mean*. Take a Netflix example: ![Transforming data into insights](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/08/transforming-data-into-actionable-insights-enables-you-to-become-a-trusted-partner.png) - **Data:** Revenue is $500M, up 10%. Not bad, but not meaningful on its own. - **Benchmark:** Growth is five points below market and slipping versus last quarter. Now it’s a problem. - **Insight:** Digging deeper, you find retention is dropping in one key segment. Suddenly we know what’s driving the slowdown. - **Recommendation:** That segment values thrillers and mystery shows. Investing more there could boost retention and revive growth. That last step (the recommendation) is what separates “data providers” from trusted partners. If your work stops at metrics, you’re a report generator. If you connect metrics to business drivers and actions, you’re a decision-maker. ****Remember:** Stories stick; facts fade. You might have 20 insights from your analysis, but if you try to present them all, you’ll bury the lead. Instead, pull out the three or four takeaways that matter most, and make those the spine of your story. One trick I use is the “five-year-old test”: could I explain my insight in simple enough terms that a child would get it? If not, I need to simplify further. The extra detail can always be held back for Q&A. ## **Identify your stakeholders** Even the best story won’t matter if it’s told to the wrong people. That’s where [stakeholder](https://www.financealliance.io/stakeholder-communication-plan/) mapping comes in. ![Identify stakeholders](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/08/Identiyfy-your-stakeholders-to-adjust-level-of-engagement-and-drive-impact-on-business.png) The classic power vs. interest framework is a great guide: - **High power, high interest:** Your key players. These are the partners you must engage deeply. - **High power, low interest:** Keep them satisfied so they don’t become blockers. - **Low power, high interest:** Keep them involved, but don’t overinvest. - **Low power, low interest:** Monitor lightly. In my role at Google, product managers and GTM strategy leaders are top-right stakeholders. They’re the ones whose buy-in determines whether analysis turns into action. ## **The dual role: Champion and challenger** Finance plays its role most powerfully when we balance two modes: champion and challenger. ![champion vs challenger](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/08/champion-challenger-framework-to-influence-business-partners.png) - **Champion**: This is where you recognize what’s working and amplify it. Celebrate wins with your partners, share credit generously, and show how their strategy can scale even further. For example, if a product team’s campaign is hitting its ROI targets, we in finance can demonstrate how those tactics could extend into other regions or business lines. This builds goodwill and positions us as allies. - **Challenger**: The harder role (but equally vital) is being the objective voice when things *aren’t* working. Say revenue is decelerating or the ROI on a new initiative doesn’t justify the spend. It’s our job to bring that to the table, backed with data, and propose better options. During business planning, that might mean questioning why resources are going to lower-ROI projects when stronger ones are being underfunded. The key is balance. If finance only ever champions, we become cheerleaders. If we only ever challenge, we become blockers. But when we do both, we earn trust and respect. --- [Copilot vs Claude for Excel: Which AI assistant wins?Copilot vs Claude for Excel: Which AI assistant wins for formula building? Find out here with Salvatore Tirabassi’s expert breakdown.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-190.png)Finance AllianceSalvatore Tirabassi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--72--1.png)](https://www.financealliance.io/copilot-vs-claude-for-excel-which-ai-assistant-wins-for-formula-building/) --- ## **Influence business partners through effective narratives** ![Influence business partners](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/08/influence-BPs-through-effective-narratives-to-drive-impact.png) The challenger role requires tact. Here are the three pillars I use: 1. **Ask probing questions.** Instead of bluntly saying “this won’t work,” challenge assumptions. Try: *“What assumptions are we making here? What happens if retention doesn’t improve?”* or *“Have we thought through potential weaknesses?”* This reframes critique as curiosity. 2. **Offer alternative solutions.** Never point out a flaw without suggesting a better path. For example: *“I see ROI is slipping in this initiative—what if we shifted spend to this other campaign where results are stronger?”* That way, you’re enabling, not obstructing. 3. **Use collaborative language.** Words matter. Replace “you’re wrong” with “I have a different perspective.” Swap “this won’t work” for “let’s try another approach.” Phrasing challenges as opportunities creates a sense of shared ownership rather than confrontation. These techniques help finance maintain credibility as an honest broker while still preserving relationships. ## **Tailoring to different departments** It’s also important to recognize that different departments come with different cultures and priorities: **Legal** tends to be defensive and risk-averse. When partnering with them, you need to come prepared with thorough due diligence and airtight reasoning, because they’ll scrutinize everything. **Sales**, on the other hand, is fast-moving and action-oriented. They often prioritize speed over detail. When working with sales, trim the caveats, keep the message tight, and focus on the upside potential. Understanding these differences helps you adapt your style. Cross-functional collaboration isn’t about forcing everyone to work the way finance does, it’s about meeting partners where they are, while still holding the line on sound decision-making. --- *This article is based on Kavin Soni's brilliant talk at the CFO Summit. Finance Alliance members can enjoy the complete recording* [*here*](https://www.financealliance.io/ondemand/)*.* ### Why we switched to Payhawk: How we streamlined spend & closed faster URL: https://www.financealliance.io/why-we-switched-to-payhawk/ Last updated: 2025-10-08T09:04:16.000Z As Finance Director at Finance Alliance, I’ve always believed that the right tools can make or break how effectively a team operates. A finance team isn’t just about processing numbers, it’s about enabling the rest of the business to grow with confidence, while keeping operations compliant, efficient, and scalable. When I first joined Finance Alliance, we were using a different platform for expense management. It was a good solution for our size at the time. But as the business grew, our financial processes became more complex. Managing approvals, handling multiple currencies, and integrating everything into Sage Intacct (our accounting system) became increasingly important. That’s what led us to look at alternatives and eventually switch to [Payhawk](https://payhawk.com/). --- We’ve partnered with **Payhawk** to walk you through the real benefits of a single spend management solution. Review your current finance workflows to start saving time for next year. [Book your free 1:1 session](https://www.financealliance.io/control-your-company-spend-at-scale/) --- ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/09/payhawk-quote-2.png) ## **What is Payhawk?** Payhawk is a global spend management platform that helps finance teams control and automate company spending across corporate cards, invoices, payments, and budgets. It offers real-time visibility into expenses, deep integrations with accounting and ERP systems like Sage Intacct, NetSuite, and Xero, and powerful automation features such as receipt capture, categorization, and audit trails. Key capabilities include: - **Real-time sync & closing** → Faster [month-end close](https://www.financealliance.io/month-end-close-checklist/) with up-to-date expense data and hyperlinks to bills. - **Master data automation** → Consistent codings from Sage Intacct to Payhawk, fewer errors, and easy resync if needed. - **Spend classification & audit** → Automated categorisation, attachments, timestamps, and communication for compliance. - **Fast, smooth setup** → Quick deployment with low disruption, guided assistance, and clear how-to manuals. - **Supplier sync** → Keeps vendor data consistent between systems. - **Approvals** → Highly customisable flows to reflect business best practices and save approvers time. ## **The challenges we faced** Our original tool had worked well as a starter tool, but as our company scaled, the gaps became more obvious. The biggest challenge was integration with Sage Intacct. At the time, most providers were only beginning to build connections to Intacct. That meant we were relying on workarounds, which slowed down our month-end process and created risks of errors creeping into our books. We also found limitations in how we could structure approvals. Our business needs aren’t one-size-fits-all. Some transactions require multiple layers of oversight, while others (particularly those that fall within predefined criteria) should move quickly to avoid unnecessary bottlenecks. Without flexible approval flows, we were either slowing people down or leaving gaps in oversight. Currency management was another concern. With a significant portion of our operations in USD, we needed a platform that wouldn’t rack up avoidable currency fees. Individually, each of these pain points was manageable. Together, they added up to friction that wasted time and increased costs. ## **Making the switch to Payhawk** Switching platforms can often feel daunting, but the move to Payhawk was refreshingly smooth. Their team supported us with clear how-to manuals, guided assistance, and best practices that minimized disruption. Within weeks, we had everything set up: - Supplier data syncing seamlessly between Payhawk and Sage Intacct. - Approval workflows mapped to our exact requirements. - Automated expense categorisation and audit trails in place. The deployment was fast, intuitive, and didn’t drain valuable time from our finance team or our employees. ## **The results** The impact of moving to [Payhawk](https://payhawk.com/) has been immediate and measurable, touching every part of our finance workflow. To really appreciate the difference, it helps to compare life before and after the switch. Before, we were often forced to rely on manual workarounds to connect with Sage Intacct. Month-end was slower and more stressful than it needed to be, with the finance team spending hours chasing invoices and double-checking coding accuracy. Approval flows were rigid and didn’t reflect how our business actually operated, which either slowed people down or left gaps in oversight. On top of that, managing spend in USD meant higher transaction fees, and inconsistent coding left us exposed to errors that required even more clean-up. After moving to Payhawk, those pain points quickly disappeared. The established, deep integration with Sage Intacct meant our data flowed cleanly and automatically. Real-time sync of expenses gave us faster visibility, so the month-end close became smoother and far less stressful. Approval workflows could finally be customised to our needs, ensuring the right people were always involved but without unnecessary bottlenecks. Payhawk’s USD-specific features reduced the fees we had previously been paying, while master data automation brought consistency between systems, cutting down on errors and saving valuable time. On top of that, every transaction now carries a complete audit trail with attachments, timestamps, and communications built in - giving us confidence in compliance and simplifying audit preparation. Payhawk hasn’t just improved individual processes, it has raised the overall standard of how we manage spend across the business. --- ### Control your company spend at scale Still juggling spreadsheets, manual reconciliations, and siloed spend tools? You’re not alone. Many finance leaders spend **up to 40 hours** researching, comparing, and trialling new tools before making a decision - that’s a full working week lost before the real work even begins. We’ve partnered with Payhawk to make it easier. In a [**free 1:1 session**](https://www.financealliance.io/control-your-company-spend-at-scale/), you’ll see exactly how a single spend management solution can transform your finance workflows and free up valuable time. Imagine seamless ERP integrations, real-time visibility, and complete control across every entity and expense. No more tool-hopping. Just smarter, faster, more strategic decisions. Here’s what you’ll get in your 1:1 session: 🧠 A personalised review of your current finance workflows. ⚙️ Side-by-side comparisons so you don’t waste hours doing it yourself. 📱 A live walkthrough of Payhawk’s platform (cards, expenses, AP, and integrations). 💡 Practical recommendations to streamline spend, strengthen control, and scale with confidence. [Book your 1:1 session today](https://www.financealliance.io/control-your-company-spend-at-scale/) ### Driving digital transformation in finance: Overcoming challenges & achieving measurable results URL: https://www.financealliance.io/driving-digital-transformation-in-finance/ Last updated: 2026-04-24T14:25:19.000Z I’ve spent the last two decades working on organizational effectiveness and digital transformation across industries, from automotive and banking to big tech and, most recently, pharma. Along the way, I’ve learned that while the technology evolves quickly, the real challenge in transformation is rarely the tools - it’s the people, the data, and the strategy behind it. In this blog post, I want to share how I see [digital transformation unfolding in finance today](https://www.financealliance.io/your-guide-to-finance-transformation/), why AI is changing the game, and the framework I use to make transformation *real*. ## **What digital transformation really means** When people talk about [digital transformation](https://www.financealliance.io/how-finance-digital-transformation-impact-company/), it often sounds like something brand new. But in truth, it’s been happening for decades. The introduction of Excel was digital transformation. Even moving paper records to ERP systems was classed as digital transformation. At its core, digital transformation is organizational change through digital tools and business models with the goal of improving performance. So, the key question for finance leaders isn’t “Should we do this?” It’s: *How do we make sure our investments deliver real value instead of chasing shiny tools?* ## **Why now? The perfect storm for change** The reason transformation feels urgent today is because several forces have converged: ![digital transformation growth](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/08/growth.png) - **Computing power has exploded** \- what once took mainframes now fits in our smartphones. - **Real-time connectivity is universal** \- 5G, cloud platforms, and collaboration tools make instantaneous information sharing possible. - **Data is everywhere** \- sensors, transactions, and digital footprints give us a flood of information. - **Costs are falling** \- storage and processing are cheaper than ever. This convergence has also transformed consumer (and employee) expectations. People are used to seamless, personalized digital experiences in their daily lives, and they expect the same inside the enterprise. For finance teams, this creates both opportunity and pressure. AI models, cloud platforms, and [analytics tools](https://www.financealliance.io/implementing-predictive-analytics-in-financial-forecasting-an-ai-driven-approach/) have become commodities. Any company can buy them. The real competitive advantage lies in data quality, data accessibility, and data governance. Finance is uniquely positioned here. As the function that sees across operations, [supply chain](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/), and commercial activities, we’re often the “goalkeepers of enterprise data.” That gives us a responsibility (and an opportunity) to lead digital transformation. ## **AI: From winter to breakthrough** AI may feel new, but it has a long history. After early promise in the 1960s, the field went through an “AI winter” in the 1970s when the technology wasn’t ready. Advances in machine learning and deep learning reignited momentum in the 2000s. ![Evolution of AI](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/08/evolution-of-ai.png) A few milestones stand out: - **2016:** Google’s AlphaGo defeated a human Go champion, making an unprecedented move that demonstrated machine creativity. - **2017:** The landmark paper *Attention Is All You Need* laid the foundation for today’s large language models (LLMs). - **2023:** Generative AI tools like [ChatGPT](https://www.financealliance.io/chatgpt-for-excel/) hit the mainstream, shifting expectations almost overnight. Today, machines already outperform humans in some areas and are catching up quickly in others. For finance, this means rethinking how we forecast, analyze, and advise the business. It’s also important to distinguish between: **Digitization**: Converting paper processes to digital format. **Digitalization**: Redesigning processes and business models to create new value. Finance must resist the trap of implementing tools for the sake of “being digital.” Instead, we should ask: Does this technology improve performance and decision-making? --- [How AI is transforming financial modeling & sales forecasting in enterprise techThis article explores how AI is transforming financial modeling and sales forecasting (two pillars of enterprise strategy) and helping finance teams shift from reactive to proactive operations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-186.png)Finance AllianceSupreeth Meka![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--56-.png)](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) --- ## **A simple value-creation model** I like to think about digital transformation through three layers: 1. **Data (Sensors & Inputs):** The raw material (everything from IoT sensors to survey responses). 2. **Models (Intelligence):** The algorithms, prompts, and applications that turn data into insight. 3. **Platforms (Execution):** The systems that connect data and models to decision-making at scale. One of my favorite examples is a virtual grocery store in a Seoul subway station. Commuters scanned products on digital shelves, ordered via their phones, and had groceries delivered by the time they got home. It combined real-time data capture, intelligent processing, and fast execution into a seamless new business model. Finance can take the same approach to budgeting, forecasting, compliance, and beyond. ## **Finance use cases in practice** ![finance use cases in digital transformation](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/08/finance-case-studies.png) Across industries, I’ve seen several powerful applications of AI and digital tools in finance, such as: - Duplicate payment prevention - Automated reconciliation and close support - Financial forecasting and [scenario modeling](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/) - Generative AI for reporting and chatbot support A practical example: with Microsoft Copilot, a finance professional can start the day by asking Excel for a data summary, have Teams auto-generate meeting notes, run scenario analyses in minutes, and instantly turn outputs into a presentation. That’s transformative efficiency. But it still requires human judgment. Even when using your own company’s data, you must double-check outputs before presenting or acting. ## **Trends shaping finance transformation** In pharma (and broadly across industries), I see five trends dominating: 1. **Increased automation** to improve efficiency. 2. **Personalized experiences** for both customers and employees. 3. **Rapid AI investment**, though ROI isn’t always clear. 4. **Deeper integration of AI in core processes** (e.g., diagnostics in healthcare, forecasting in finance). 5. **Heightened focus on security, compliance, and sustainability.** For finance, these trends point to a future where we’re expected to deliver not just reports, but predictive and prescriptive insights that shape business strategy. ## **Challenges and risks** ![challenges in AI](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/08/risks.png) Transformation isn’t smooth sailing. The technology is often the easy part—the real hurdles are organizational and structural. From my experience, the biggest barriers are: ### **1\. Alignment with company strategy** Digital transformation can’t be something finance does in isolation. If your company’s broader strategy is focused on customer intimacy, but finance is investing in automation purely for cost-cutting, you’ll create friction instead of value. Transformation must be anchored to enterprise goals. That means finance leaders need a seat at the table early, shaping and aligning digital initiatives with the company’s north star. ### **2\. Data quality and variety** We often say “garbage in, garbage out,” but in digital transformation, the stakes are higher. With AI models and predictive analytics, poor-quality or inconsistent data doesn’t just limit accuracy, it can actively mislead decision-makers. Finance sits at the intersection of so many data streams (operational, commercial, supply chain, HR) that we need strong governance to harmonize them. Without that, digital tools won’t deliver their promise. ### **3\. Skills gaps and workforce disruption** Many finance teams are still built around traditional reporting and compliance tasks. But the future of finance requires fluency in analytics, data visualization, automation, and AI. Upskilling existing staff is crucial, but so is rethinking roles. Do we build capabilities internally? Do we bring in new talent? Or do we partner with external providers? Each path comes with trade-offs, and leaders need to manage the cultural impact as much as the technical one. ### **4\. Regulatory complexity and compliance** Finance is already one of the most heavily regulated functions. Layer on top of that emerging AI regulations (like the EU AI Act or U.S. state-level privacy laws), and the landscape gets even more complex. For global companies, keeping pace with overlapping and sometimes conflicting rules is a real challenge. Non-compliance isn’t just a reputational risk, it can also mean legal exposure and financial penalties. Because of these risks, many companies are moving toward private AI environments. Instead of relying on public large language models, they’re building controlled ecosystems: versions of AI tools trained only on company-approved data, with strict governance over inputs, outputs, and access. --- [Navigating uncertainty: Why agile FP&A is your competitive edgeMaster change with agile FP&A—turn uncertainty into opportunity through flexible forecasting, data-driven decisions, and smarter collaboration.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-187.png)Finance AllianceImane Haouassia![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--71-.png)](https://www.financealliance.io/navigating-uncertainty-why-agile-fp-a-is-your-competitive-edge/) --- ## **A framework for digital transformation in finance** Here’s the framework I’ve applied in my work: ![digital transformation strategy](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/08/strategy.png) 1. **Assess digital maturity**: Where are we starting from? What’s our current capability in data, processes, and tools? 2. **Align with company strategy**: Finance’s digital strategy must connect directly to enterprise goals. 3. **Identify focus areas**: Use maturity assessments to decide where to invest first. 4. **Build digital culture**: Data governance, predictive modeling, business process redesign, and upskilling. 5. **Create a digital portfolio**: Concrete initiatives like predictive forecasting, workflow automation, or smart dashboards. 6. **Establish a platform for collaboration**: Share insights, invite innovation from across the company, and integrate with HR, IT, and business units. Throughout all of this, remember: Technology is 30% of the work. People are 70%. Change management, communication, and engagement are the true success factors. ## **The role of finance in leading transformation** So, who should lead digital transformation? In my view, no single department can do it alone. But finance is uniquely positioned to take the lead. Why? Because finance has visibility across the entire organization. We see operational data, commercial data, supply chain data, and costs - all in an aggregated way. That vantage point makes us a natural driver of transformation, provided we step into the role. --- *This article is based on Juan Ignacio Pascual's brilliant talk at the Finance Transformation Summit. Finance Alliance members can enjoy the complete recording* [*here*](https://www.financealliance.io/finance-transformation-virtual-summit-2024/)*.* ### Driver-based forecasting for FP&A to align strategy with reality URL: https://www.financealliance.io/driver-based-forecasting-for-fp-a-to-align-strategy-with-reality/ Last updated: 2025-10-08T09:04:28.000Z Most forecasts begin with a hopeful number like, “Let’s grow revenue by 10% next year. This sounds good on paper. But where exactly is that 10% coming from? More customers? Higher prices? Better conversion? If you don’t know the drivers behind your numbers, your forecast is basically just a fancy guess. **That’s where driver-based forecasting changes the game.** Instead of projecting numbers in a vacuum, this approach ties your financials to actual business activities. You model how marketing spend, headcount, churn, or pricing moves the bottom line. It’s more dynamic. More realistic. And way more useful when the business environment shifts. ## What is driver-based forecasting? It’s forecasting that mirrors real-world business behaviour. Instead of saying, “Let’s grow revenue,” you say: - How many customers do we expect? - What’s the average order value? - How often do they buy? You break revenue into components that matter. That’s the power of driver-based thinking. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-184.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FP-A-career-salary-and-path-2-6.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## Why do finance teams love it? Because it gives you… - **More accurate forecasts:** Forecasts based on activities, not assumptions. - **Quick what-if scenario planning**: Want to see the impact of a 5% drop in conversion or a 20% jump in churn? Tweak the driver and gain instant insights. - **Cross-functional alignment** - **Clear Accountability**: Sales owns volume. Marketing owns lead gen. Finance connects the dots. - **Simple reforecasting when things change:** Change the driver, update the forecast. No rebuild needed. It’s not just about better modelling. It’s about smarter decision-making. ### Picking the right drivers Ask yourself: *What really moves the needle in this business?* For SaaS, it might be active users and churn. For retail, maybe footfall and basket size. For services, billable hours, and utilization. Don’t overcomplicate it. Focus on the 3–5 drivers that really matter. ## How to build one 1. **Model structure:** Use Excel or any tool you like. Set up timelines - monthly or weekly. 2. **Driver sheet:** This is your control panel. Input assumptions like the number of customers, churn %, and conversion rates. 3. **Link drivers to outputs.** 4. **Connect to P&L, balance sheet, and cash flow:** Build dynamic links so financials update automatically. 5. **Test scenarios:** Want to explore a 10% drop in leads or 15% increase in price? Adjust, observe, plan. This makes your model flexible and ready for anything. --- [Copilot vs Claude for Excel: Which AI assistant wins?Copilot vs Claude for Excel: Which AI assistant wins for formula building? Find out here with Salvatore Tirabassi’s expert breakdown.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-185.png)Finance AllianceSalvatore Tirabassi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--72-.png)](https://www.financealliance.io/copilot-vs-claude-for-excel-which-ai-assistant-wins-for-formula-building/) --- ## Common mistakes to avoid - **Too many drivers:** Makes the model hard to use and maintain. - **Wrong drivers:** Track what *matters*, not just what’s easy. - **Overcomplicating:** If updating it feels like surgery, it won’t get used. - **No buy-in:** Involve stakeholders. If they don’t trust the model, they won’t use it. - **One-time setup:** It’s not ‘build and forget.’ Update your assumptions regularly. Keep it clean. Keep it collaborative. And keep it updated. ## Real-world examples **SaaS business** - Revenue: active users, ARPU, churn - Costs: CAC, support headcount **Retail brand** - Revenue: foot traffic, conversion, basket size - COGS: units × cost per unit **Manufacturing unit** - Revenue: units produced, pricing - Costs: raw materials, machine downtime **Professional services** - Revenue: billable hours, hourly rate - Costs: headcount, utilization Every industry has its own drivers. The trick is finding yours and focusing relentlessly on them. Driver-Based Forecasting helps you move from static budgets to living models. It connects finance to what’s actually happening in the business. Driver-based forecasting isn’t just a finance tool. It’s a business strategy. It forces teams to think about *why* numbers change, not just *what* the numbers are. If you’re in FP&A and want to make your models more accurate, your insights more actionable, and your seat at the strategy table more permanent, start with your drivers. ### Navigating cross-functional collaboration as an FP&A Lead URL: https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/ Last updated: 2026-04-20T07:31:07.000Z As the Head of FP&A, I’ve spent a lot of time thinking about how we can better connect the dots between cross-functional teams and upper management. In my experience, [it’s easy for FP&A teams to get siloed](https://www.financealliance.io/fp-a-team-structure/), treated as mere number crunchers rather than the strategic partners we can and should be. However, our role is crucial in bridging the gap between what happens on the ground and what the executives see and decide in the boardroom. In this article, we'll explore the challenges and strategies with collaboration as an FP&A Lead and the importance of aligning incentives with business goals. Read on to discover: - [The reality of FP&A in organizational structures](https://www.financealliance.io/p/95f0382a-bd0d-4a16-8af0-0147cfb1892d/#the-reality-of-fpa-in-organizational-structures) - [Motivating the organization – beyond data handling](https://www.financealliance.io/p/95f0382a-bd0d-4a16-8af0-0147cfb1892d/#motivating-the-organization-%E2%80%93-beyond-data-handling) - [Herzberg’s two-factor theory and its application](https://www.financealliance.io/p/95f0382a-bd0d-4a16-8af0-0147cfb1892d/#herzberg%E2%80%99s-two-factor-theory-and-its-application) - [Aligning financial incentives with business goals](https://www.financealliance.io/p/95f0382a-bd0d-4a16-8af0-0147cfb1892d/#aligning-financial-incentives-with-business-goals) - [Designing effective commission structures](https://www.financealliance.io/p/95f0382a-bd0d-4a16-8af0-0147cfb1892d/#designing-effective-commission-structures) ## The reality of FP&A in organizational structures In most organizations, [FP&A often sits on the periphery of business operations](https://www.financealliance.io/6-steps-to-transform-fp-a-into-a-platform-for-strategic-alignment/). We’re expected to be the "air traffic controllers." Yet, in many instances, we find ourselves more as spectators, analyzing data from the sidelines rather than being central to decision-making processes. This peripheral positioning can be a significant challenge. I’ve seen firsthand how this structure can limit our ability to contribute strategically. The reality is that FP&A teams are often underutilized, not because of a lack of skill or insight, but because of a disconnect in how we’re integrated into the business. The key to overcoming this is increasing our interaction with different business units, [establishing ourselves as trusted partners](https://www.financealliance.io/3-ways-an-fp-a-professional-can-thrive-amongst-a-field-of-skepticism/) rather than just another cog in the corporate machine. One way I’ve approached this is by actively seeking out opportunities to collaborate with other departments. Whether it’s sitting in on marketing strategy meetings or getting involved in product development discussions, the more we understand the challenges and goals of other teams, the more effectively we can contribute. This kind of [cross-functional collaboration is essential](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/) for an FP&A Lead who wants to be more than just a financial analyst. ## Motivating the organization – beyond data handling In FP&A, our day-to-day is often dominated by data—collecting it, analyzing it, reporting it. But one of the biggest lessons I’ve learned is that motivation can’t come from data alone. It’s about [connecting that data to something bigger](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/), something that resonates with the broader goals of the company and the people working within it. When I think about motivation, I’m reminded of the many theories out there, like Maslow's hierarchy of needs. Now, while Maslow offers some interesting insights, I’ve found that it’s not always directly applicable in our field. The reality is that most of us in FP&A are already well beyond the basic needs—our focus is on achieving our full potential and helping others do the same. That’s where I believe our role can really shine. As FP&A Leads, we have the ability to inspire others by showing how their work contributes to the overall success of the company. It’s about making that connection between what might seem like mundane tasks and the larger picture. This is especially important when working with cross-functional teams who may not immediately see how their day-to-day impacts the company's financial health. **Practical application:** - **Budgeting and forecasting**: It’s not just about getting the numbers right. - **Marketing team’s spend**: How does it influence our revenue projections? - **Product development’s timeline**: How does it affect our cash flow? By making these connections clear, we can help motivate other teams to align their goals with the company’s financial objectives. --- [How to design FP&A team structure (with examples)One of the hardest questions to answer about FP&A is ‘what is the typical FP&A team structure?’ This question is so hard to answer because there is no one-size-fits-all…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePatrick Dennehy![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/Copy-of-FA_Website_Article_Images_Author_Highlight--2-.png)](https://www.financealliance.io/fp-a-team-structure/) --- ## Herzberg’s two-factor theory and its application One theory that I’ve found particularly useful in FP&A is Herzberg’s two-factor theory, which distinguishes between hygiene factors (things that can cause dissatisfaction if missing but don’t necessarily motivate when present) and motivators (factors that genuinely drive engagement and satisfaction). In the context of FP&A and cross-functional collaboration, hygiene factors might include things like having the right tools and systems in place. These are essential, of course, but they’re not going to motivate anyone on their own. What really drives people, I’ve found, are the motivators—things like recognition, a sense of achievement, and the opportunity for advancement. **Practical example:** - When working on a [major financial report](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/) that involves input from multiple teams, it’s easy to fall into the trap of just gathering the data and moving on. - Instead, take time to recognize the efforts of those who contributed. A simple shoutout in a meeting or a note of thanks can go a long way. These small acts of recognition can be incredibly powerful motivators, especially in cross-functional settings where it’s easy for contributions to go unnoticed. Moreover, providing opportunities for growth is crucial. In FP&A, we have a unique vantage point—we see the whole business, and this gives us the ability to help others understand how their work fits into the bigger picture. By mentoring others or offering insights that help them advance in their roles, we not only build stronger relationships but also create a more motivated and engaged workforce. ## Aligning financial incentives with business goals One of the most challenging aspects of being an FP&A Lead is aligning the financial goals of the business with the motivations of the people who make up the business. This often comes down to designing effective compensation and incentive plans. In my experience, there’s often a disconnect between the [financial goals](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) set by the business owners or board and the operational goals of management. This is particularly true in situations like private equity deals, where the focus is heavily on EBITDA or revenue growth. However, if the incentive structures aren’t aligned, you end up with a situation where teams might be working at cross purposes. Common misalignments: - **Sales vs. profitability:** Sales teams may be incentivized on revenue, which could drive them to close unprofitable deals. - **Cost-cutting vs. quality:** Operations may focus on cutting costs, potentially harming product quality or customer experience. As FP&A Leads, it’s our job to find that balance, ensuring that everyone is pulling in the same direction. To achieve this, I’ve found that it’s essential to involve FP&A in the design of compensation plans from the outset. This way, we can help ensure that the incentives are aligned with the broader business goals. For instance, in a SaaS company, we might structure sales commissions not just on total contract value, but also on [metrics like customer retention](https://www.financealliance.io/how-fp-a-teams-calculate-and-reduce-customer-churn/) or net revenue retention. This aligns the sales team’s incentives with the long-term health of the business. --- [Recruitment in finance: 4 hiring hacks (FP&A talent)Recruiting in finance isn’t easy and I know this because I recently went through the process of building an FP&A team myself. During that experience, I quickly learned that people set parameters based on what they think the FP&A team should look like.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePatrick Dennehy![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/recruitment-in-finance1-1.png)](https://www.financealliance.io/recruitment-in-finance-4-hiring-hacks/) --- ## Designing effective commission structures When it comes to commission structures, simplicity and transparency are key. I’ve worked with various sales teams over the years, and one thing that’s become clear is that if a commission plan is too complex or not clearly communicated, it can lead to confusion, frustration, and even mistrust. The commission plans best practices include: - **Simplicity:** Ensure the plan is easy to understand and directly tied to business objectives. - **Transparency:** Openly communicate how efforts translate into earnings, building trust and alignment. - **Continuous Review:** Regularly assess and adjust the plan to ensure it continues to drive the desired behaviors. A good commission plan should be easy to understand and directly tied to the business’s key objectives. In one case, we redesigned a commission structure to be more closely aligned with EBITDA targets. We moved away from a pure revenue-based commission to one that also took into account the profitability of the deals being closed. This not only encouraged the sales team to [focus on high-quality deals](https://www.financealliance.io/m-a-best-practices/) but also helped the company hit its profitability targets more consistently. Another critical aspect is communication. When we rolled out the new commission plan, we made sure to have open forums where salespeople could ask questions and understand exactly how their efforts would translate into earnings. This transparency helped build trust and ensured that everyone was on the same page. However, it’s also important to recognize that no commission structure is perfect. There will always be unintended consequences or areas that need adjustment. As FP&A Leads, we need to be vigilant, constantly reviewing these plans and making tweaks where necessary to ensure they continue to drive the right behaviors. ## Conclusion: becoming a strategic FP&A Lead As an FP&A Lead, managing the links between cross-functional teams and upper management is both a challenge and an opportunity. It’s about more than just numbers - it’s about understanding the business, building relationships, and driving alignment across the organization. **Key takeaways:** - **Proactive cross-functional collaboration**: Seek out opportunities to engage with other departments and establish FP&A as a strategic partner. - **Motivation beyond data**: Connect data to broader goals, recognize contributions, and use motivators to drive engagement. - **Align incentives with goals**: Ensure compensation plans are simple, transparent, and aligned with the company’s long-term objectives. *\[This article is based on a presentation given by Tim Page - Head of FP&A at Ex-Capital Economics, at our FP&A Summit, Boston, in 2023\. Catch up with this presentation, and others, using our* [*OnDemand service*](https://www.financealliance.io/ondemand/)*. For more exclusive content, visit your* [*membership dashboard*](https://www.financealliance.io/pro-plus-membership-dashboard/)*.\]* ### How to streamline financial consolidation and planning URL: https://www.financealliance.io/how-to-streamline-financial-consolidation-and-planning/ Last updated: 2025-10-22T12:17:23.000Z Financial planning isn’t just numbers - it’s where strategy meets execution. But with scattered systems and limited visibility, you’re stuck patching reports instead of shaping the future. The result? Slow closes, bad forecasts, missed opportunities. **It doesn’t have to be that way.** In this live session, see how a unified, cloud CFO solution platform can speed up closes, sharpen forecasts, and give your entire business one source of truth from P&L to cash flow. **Can’t make it live? Register anyway and we’ll send you the recording.** --- ### What you’ll learn: - How cloud-native CFP tools accelerate consolidation and improve accuracy - Ways xP&A fosters real-time collaboration and agile scenario modeling - How to cut IT overhead and shorten implementation timelines - Practical tips for aligning finance and business strategy - Real-world examples of seamless planning ecosystems in action --- ### The challenges we’ll tackle: **Spreadsheet overload and slow closes** Manual work means slower reporting and higher error risk. We’ll show you how automation and a single source of truth change the game. **Siloed data and poor collaboration** When teams can’t see the same numbers, decisions suffer. Learn how unified planning improves accuracy and buy-in across the business. **Data gathering over insight generation** If most of your time goes into chasing numbers, you’re missing the chance to shape strategy. We’ll explore tools that free you up for higher-value work. **Costly, slow implementations** Long rollouts and heavy IT dependencies kill agility. Discover how modern finance tech can go live faster and deliver ROI sooner. **Misaligned strategy and execution** When finance and business aren’t in sync, opportunities slip away. We’ll show you how to connect the dots for better decision-making. --- ### About Lucanet [Lucanet](https://www.lucanet.com/) is a leading provider of financial performance management software, offering solutions for consolidation, planning, budgeting, reporting, ESG, and tax management. Trusted by over 6,000 brands in 50 countries, Lucanet empowers finance teams with a single source of financial truth to make confident, data-driven decisions. --- ### Meet the experts [**Taimur Abdaal**](https://www.linkedin.com/in/taimurabdaal/) *Managing Director xP&A, Lucanet* Taimur helps finance leaders reimagine planning and consolidation through the lens of agility, collaboration, and strategic impact, ensuring financial systems support decision-making at every level. [**James Taylor**](https://www.linkedin.com/in/jamestay1/) *Solution Engineer, Lucanet* With deep expertise in financial performance management, James bridges technical solutions and practical business needs, helping organizations build robust, future-ready finance operations. ### Copilot vs Claude for Excel: Which AI assistant wins for formula building? URL: https://www.financealliance.io/copilot-vs-claude-for-excel-which-ai-assistant-wins-for-formula-building/ Last updated: 2025-10-08T09:04:38.000Z **Copilot** offers seamless integration directly in Excel, but requires OneDrive auto-save, responds slower, and provides limited formula alternatives. **Claude** delivers faster responses with multiple formula options and excels at Power Query M code, but requires copying/pasting between windows. For basic users, Copilot’s integration wins despite its limitations. For advanced users or those preferring file control, Claude’s flexibility and speed make it the better choice. Most of my readers know that I experiment with a lot of tools and try to use them to create more efficiency in workflows for both me and my team. I regularly explore different AI tools to boost productivity and streamline our processes. I’ve written before about using AI with Excel, and I want to use this blog post as a chance to talk about the difference between [Copilot](https://copilot.microsoft.com/), which is embedded in Excel, and using a side window (I prefer to use Claude). We’ll talk about [Claude](https://claude.ai/) and compare and contrast how these two AI assistants help you with building spreadsheets and writing formulas. ## **The integration advantage: Copilot’s seamless experience** The most obvious advantage of [Copilot](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) is its direct integration into Excel. When you’re working on a formula in cell D5 and need help, Copilot already knows your context it can see your data, understand your column headers, and reference your specific cell ranges without you having to explain the setup. Copilot operates through a chat interface within Excel, allowing users to interact with the AI in a conversational manner for quick assistance and guidance. ### **Example for basic users** Let’s say you have sales data in columns A-C (Salesperson, Region, Sales Amount) and want to sum all sales for the “West” region. With Copilot, you simply ask: “Sum all sales for West region” and it generates: \`=SUMIF(B:B,”West”,C:C)\` while understanding your exact column structure. ### **Example for advanced users:** For a more complex scenario involving multiple criteria, Copilot can generate: \`=SUMIFS(C:C,B:B,”West”,A:A,”John”)\` and automatically adjust to your specific data layout. However, this integration comes with a significant trade-off that many users find frustrating. --- [5-step stakeholder communication planMaster stakeholder communication in five clear steps. You can use this guide to craft clear, consistent communication that keeps everyone aligned and engaged.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-182.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_3_stakeholder_engagement-2.jpg)](https://www.financealliance.io/stakeholder-communication-plan/) --- ## **The auto-save dilemma: Why Copilot forces your hand** Copilot requires you to turn on auto-save, which means your files must be saved to One Drive or SharePoint. This isn’t just a minor inconvenience it fundamentally changes how you work with Excel files. When auto-save is enabled, every change you make is immediately saved to the cloud. While this prevents data loss from crashes, it also means you can’t easily experiment with formulas without potentially overwriting your work. If you make an error or want to try a different approach, you may need to rely on Excel’s version history or manually reload an older file. For users like me who prefer maintaining control over when and how files are saved - creating multiple versions during development or having the safety net of deliberate save points - this auto-save requirement is a dealbreaker. ## Speed and options: Where Claude shines Claude consistently outperforms Copilot in response time. While Copilot can take several seconds to generate a response, Claude typically provides answers within 1-2 seconds. Claude often provides a concise answer as well as multiple alternatives. More importantly, Claude offers multiple formula options for the same problem, and its formula suggestions are known for their accurate answers, which helps users trust the recommendations. ### **Example comparison:** **Question:** “How do I look up a value from another sheet?” **Copilot response:** \`=VLOOKUP(A2,Sheet2!A:B,2,FALSE)\` **Claude response:** \`=VLOOKUP(A2,Sheet2!A:B,2,FALSE)\` – Traditional VLOOKUP \`=INDEX(Sheet2!B:B,MATCH(A2,Sheet2!A:A,0))\` – More flexible INDEX/MATCH \`=XLOOKUP(A2,Sheet2!A:A,Sheet2!B:B)\` – Modern XLOOKUP (if available) Claude also provides efficiency recommendations, noting that while XLOOKUP is convenient, INDEX/MATCH uses fewer system resources for large datasets. ## Best practices for data analysis using Claude effectively To get the most out of Claude for Excel formulas, follow these practices: - **Specify your target cells.** Instead of asking “how do I sum these values,” say “I want to sum values in column C where column B equals ‘West’ and put the result in cell D10.” - **Provide existing formula context.** If you’re building on an existing formula, share it with Claude. For example: “I have this formula: =SUMIF(B:B,’West’,C:C) but I need to add another condition for dates after 1/1/2024.” - **Mention your Excel version.** Claude can tailor responses based on whether you have access to newer functions like XLOOKUP or need to stick with older alternatives. Claude’s context aware writing ensures that its suggestions are relevant to your specific scenario. ### **Advanced example – Power Query M code:** One area where Claude significantly outperforms [Copilot is in Power Query](https://learn.microsoft.com/en-us/power-query/power-query-ui) development. Copilot doesn’t exist within the Power Query editor, making it unavailable for M code assistance. Claude can generate code for Power Query tasks, which allows users to quickly create M code from natural language prompts. **Scenario:** You need to transform a table where dates are in text format “YYYY-MM-DD” to actual date values. After providing the code example, Claude also acts as a code interpreter by helping users understand and debug M code. ### **Claude M code solution:** ``` = Table.TransformColumns(     PreviousStep,     {“DateColumn”, each Date.FromText(_), type date} ) ``` Claude can also explain the code, suggest optimizations, and provide alternative approaches for complex data transformations—something Copilot simply cannot do in the Power Query environment. The generated content from Claude includes not only code but also detailed explanations and alternative approaches, supporting users with comprehensive AI-driven content creation. --- [How to use Copilot in Power BIIn this article, we explore how you can leverage the power of Copilot in Power BI to help streamline your everyday processes within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-183.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/copilot-in-power-bi-2.jpg)](https://www.financealliance.io/copilot-in-power-bi/) --- ## The multi-monitor reality The copying and pasting between Claude and Excel is often cited as a disadvantage, but in today’s multi-monitor setups, this is less of an issue. Having Claude open in a side window while working in Excel actually provides some benefits. Using multiple AI tools in parallel on separate screens can further enhance productivity and enable you to leverage specialized features for coding, data analysis, and task management: - You can reference Claude’s explanations while implementing formulas - Multiple formula options remain visible for comparison - You can easily copy different variations to test in your spreadsheet For single-screen users, this workflow is admittedly more cumbersome, making Copilot’s integration more valuable despite its other limitations. ## Examples in action ### Basic user scenario: Conditional formatting **Task:** Highlight cells in column D where values are greater than 1000. **Copilot:** Provides the conditional formatting rule but requires you to navigate through Excel’s interface. **Claude:** Gives you the formula =D1>1000 and explains exactly where to apply it in the conditional formatting dialog, plus offers variations like =D1>AVERAGE(D:D) for highlighting above-average values. Both Claude and Copilot can help users write code for complex Excel formulas, making advanced tasks more accessible. ### Advanced user scenario: Dynamic array formula **Task:** Create a unique list of customers who made purchases above $500. **Copilot:** \=UNIQUE(FILTER(A:A,B:B>500)) **Claude:** Provides the same formula but also offers: - \=SORT(UNIQUE(FILTER(A:A,B:B>500))) – Sorted version - Alternative for older Excel versions using array formulas - Explanation of dynamic array behavior and spill ranges ## The verdict: Choosing your AI assistant ![Claude Vs Copilot for Excel Formulars ](https://i0.wp.com/images.surferseo.art/9bad7e52-4a7b-4045-82e7-8c8091b3feb5.png?ssl=1) For **basic Excel users** who primarily work with simple formulas and don’t mind the OneDrive requirement, Copilot’s seamless integration makes it the more convenient choice despite its slower response times. For **advanced users** who need flexibility, speed, and assistance with Power Query, or those who prefer maintaining control over their file saving workflow, Claude emerges as the superior option. The minor inconvenience of copying and pasting is outweighed by Claude’s speed, multiple options, and broader Excel ecosystem support. The **ideal scenario** might be having access to both: using Copilot for quick, context-aware assistance and Claude for more complex problem-solving and Power Query development. --- ## Join our free Insider membership Become an Insider and access the latest insights from renowned finance experts (from companies like Adobe, Salesforce, Burberry, Virgin Galactic, and more), battle-tested templates & frameworks, as well as a network of peers to bounce ideas off and help overcome your challenges. ### What's included in an Insider membership? **📑 Templates & frameworks.** Save time with battle-tested and ready-to-use templates. **✍️ Exclusive content.** In-depth thought leadership articles from world-leading companies. **📺 Real-world case studies.** Hours of insights from leaders at Adobe, Salesforce, Burberry, Virgin Galactic, and more. **📚 Ungated reports.** One-click access to industry-leading insights to shape your strategies. [Sign me up!](https://www.financealliance.io/insider-membership-plan/) ### Liquidity in DeFi: Market makers, AMMs, and the hybrid future URL: https://www.financealliance.io/liquidity-in-defi-market-makers-amms-and-the-hybrid-future/ Last updated: 2025-10-08T09:04:55.000Z The emergence of new protocols in [Decentralized Finance (DeFi)](https://www.investopedia.com/decentralized-finance-defi-5113835) has unlocked new opportunities and posed new challenges such as how to optimally source, manage, and route liquidity. As we know in any financial market, and DeFi is no different, liquidity (the ability to buy and sell freely without altering price levels) is critical. In this nascent frontier, we have two dominant competitive frameworks in liquidity provisioning: **Automated Market** makers who democratized liquidity by allowing easier access and **traditional market** makers who apply data-driven methodologies. Straddling the border of hybrid sophistication is the new breed of [Request-for-Quote (RFQ) ](https://www.investopedia.com/terms/r/request-for-quote.asp)platforms that facilitate more efficient on-chain market making, blurring the lines between decentralized approach and centralized finesse. This article illustrates how makers and [liquidity](https://www.financealliance.io/12-proven-strategies-for-managing-liquidity/) pools co-exist in DeFi, examines the advantages and disadvantages of each approach, and why a combination of both is optimal. To understand this evolving landscape, it’s best to start with why traditional market makers continue to excel over chain liquidity pools, especially with respect to operational, efficiency, and utilization of capital. ## **Why market makers beat onchain liquidity pools** Market makers operate on the trading floor, always ready to buy and sell any asset at different prices on the booking for range efficiently [managing risks](https://www.financealliance.io/ai-in-risk-management-how-banks-can-mitigate-fraud-and-financial-crimes/) along with getting profit value with changing value. They trade on off chain data, private company trade patterns, and trade models. Their style enables: 1. **Tighter spreads and lower slippage** 2. **Real-time price discovery** 3. **Hedging strategies that reduce risk exposure** On the other hand, the AMMs (Automated Market Makers) use fixed pricing calculations such as the x\*y=k constant product formula, which does not change with market fluctuations or outside information. That means that AMMs are inefficient in terms of capital, and liquidity providers (LPs) face impermanent loss risk, a risk created when the price of assets becomes unbalanced and LPs are taken advantage of by arbitrage traders actively exploiting price disparities. --- [Driving innovation: From CFO “no” to strategic growth partnerDiscover how finance teams can drive innovation, not block it. Learn how strategic finance leaders enable growth through risk-balanced decisions, scenario planning, and capital allocation frameworks.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-178.png)Finance AllianceKevwe Ijatomi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2-.png)](https://www.financealliance.io/cfo-no-to-strategic-growth-partner/) --- ## **RFQ platforms: Merging onchain transparency with offchain efficiency** However, a new breed of platforms is emerging, offering a bridge between the strengths of traditional market making and decentralized liquidity. Platforms like 0x RFQ, CowSwap, and Paraswap operate on an RFQ basis which integrates [traditional market making](https://financefacts101.com/understanding-market-makers-role-functions-and-key-players/) with a decentralized model. Unlike order books and AMM curves, RFQ systems allow professional market makers to provide tailored quotes that balance responsiveness and strategic pricing. This system provides optimal and competitive prices with lower slippage and better trade execution. Additionally, RFQ platforms have more protection against MEV and front running while making capital use more efficient for market makers. Through RFQ platforms, market makers are able to selectively provide liquidity directly onchain, which results in better capital utilization and more efficient markets without loss of transparency or trustlessness. ## **Challenges of onchain liquidity pools** Although onchain [liquidity pools](https://www.swaap.finance/blog/harnessing-ai-and-machine-learning-for-enhanced-liquidity-provision?utm%5Fsource) allow frictionless access to decentralized finance (DeFi), letting anyone provide liquidity and trade assets without the need for centralized intermediaries, the technology still has major limitations which reduces its efficacy in harsher market conditions. One of the well known problems is **impermanent loss**. It occurs when liquidity providers (LPs) suffer opportunity losses for not simply holding onto their assets. This risk further grows owing to how automated market makers (AMMs) operate and the dependence on arbitrage to keep prices in sync with external markets. Another major issue remains **capital inefficiency**. In Automated Market Makers (AMMs), liquidity is usually spread statistically uniformly across a certain price region, and therefore, only a fraction of it is located at or near the market price at any given time. This capital inefficiency leads to shallow liquidity and greater slippage resulting in higher costs of trading and greater impact for large trades. Furthermore, the emergence of several blockchains and decentralized exchanges has resulted in **liquidity fragmentation**, the phenomenon of liquidity being distributed across many isolated pools, reduces the overall market depth and increases the difficulty of finding the optimal execution path. In addition, the **fixed algorithms** employed by AMMs, including their constant product formula, are overly simplistic and do not adjust automatically in real time to fluctuations in market conditions, volatility, or trading activity. This makes them less flexible and less competitive relative to traditional market makers who use real-time data and dynamic strategies. As DeFi matures, addressing these limitations will be crucial if onchain liquidity is to compete with more sophisticated offchain systems. These structural shortcomings with AMMs restrict their efficacy in high-volume or highly volatile situations where price accuracy, execution speed, and capital efficiency are paramount. --- [The secret to effective communication with the C-suiteIf you’ve ever wondered how finance can evolve from gatekeeper to strategic partner, this article offers the blueprint. You’ll get real-world takeaways on building influence, navigating complex stakeholder dynamics, and driving value without losing your voice.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-179.png)Finance AllianceNick Quiroz![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/wayfair-2.png)](https://www.financealliance.io/how-wayfair-made-me-rethink-everything-i-knew-about-finance/) --- ## **When onchain pools outperform traditional market makers** Although traditional market makers are generally more efficient, AMMs and onchain liquidity pools remain essential to the DeFi ecosystem and can outperform in specific scenarios: - **Long-tail assets**: For tokens with low demand or niche use cases, AMMs may be the only source of liquidity. - **Permissionless access**: Anyone can list a token or provide liquidity without relying on institutional market makers. - **Composability**: AMMs are easily integrated into other DeFi protocols (e.g., lending, yield farming, options). - **24/7 operation**: Onchain pools never go offline and are available globally, unlike centralized exchanges. Incentive mechanisms like yield farming and governance token rewards can also make LPing attractive despite potential losses. ## **Toward a hybrid liquidity model** Considering the advantages of both AMMs and traditional market makers, it is clear that the future of liquidity provisions in DeFi won’t be based on a single method. Rather, the system is progressing towards a hybrid model which combines the features of AMMs and the efficiency of RFQ-based systems. Frictionless trading systems, or RFQ platforms, are increasingly used by traditional market makers which allows for high-efficiency, dynamically priced trades with low slippage. Even so, AMMs still serve as a baseline provider of non-restricted liquidity, especially for long tail assets and new tokens that do not yet capture the attention of professional market makers. Lately, innovations such as concentrated liquidity in Uniswap v3 have helped bridging the gap by greatly enhancing capital efficiency in AMMs. This hybrid structure enables optimized trade execution while still maintaining the open and permissionless characteristic of DeFi. ### **Risks and considerations** However, this blending of models introduces new risks and complexities. As traditional actors bring more sophisticated tools and strategies into the DeFi ecosystem, several challenges begin to surface: - **Data fragmentation**: DeFi spreads across multiple blockchains, making unified data access difficult. - **Centralization risks**: If RFQ platforms or AI-driven market makers are dominated by a few entities, it could recreate the very intermediaries DeFi aimed to eliminate. - **Transparency vs. efficiency trade-offs**: Advanced pricing algorithms and offchain activity may reduce the system’s auditability and openness. Resolving these issues calls for continuous invention in the frameworks of governance, open standards, and interconnectivity so that DeFi does not deviate from its foundational tenets amidst new challenges. ## **Conclusion** Looking ahead, DeFi stands at a crossroads as it evolves toward a more infrastructure-driven model. On one hand, traditional market makers using RFQ enabled platforms control risk and provide unmatched execution quality. On the other hand, liquidity pools tend to disintegrate barriers to entry for market participation. The best outcome seems to be a model where both sides support one another instead of replacing each other. By combining a few models while providing sufficient decentralization as well as data and governance safeguards will allow DeFi to build frameworks as resilient as they are inclusive. This will make the entire ecosystem far more efficient. Thus, the new era of DeFi will not focus on simply optimizing liquidity floor algorithms. Rather, it will transform how assets are traded, invested, and value is ultimately built in a decentralized financial landscape. --- ### Become an Insider member Join 1,000+ rising finance stars who trust Finance Alliance to be their preferred learning and development hub. Benefit from our community-led resources through the Insider plan, for free! Access the latest insights from renowned finance experts (from companies like Adobe, Salesforce, Burberry, Virgin Galactic, and more), battle-tested templates & frameworks, as well as a network of peers to bounce ideas off and help overcome your challenges. No catches, no monthly bills - 100% free, forever. [Become an Insider (it's free!)](https://www.financealliance.io/insider-membership-plan/) ### Take control of spend before it controls you. URL: https://www.financealliance.io/one-budget-two-perspectives/ Last updated: 2025-09-04T13:54:29.000Z Budget season shouldn’t feel like a minefield. Yet too often, finance leaders are blindsided by unexpected renewals, hidden vendor costs, and last-minute approvals that derail carefully built forecasts. When FP&A and Procurement operate in silos, Finance ends up reactive - patching holes instead of steering the plan. **But it doesn’t have to be that way.** This session is designed for finance professionals who are tired of working with partial data and chasing down surprises. By connecting the dots between contracts, spend intelligence, and forecasts, you’ll gain the tools to plan proactively, not defensively. **Can’t make it live? Register anyway and we’ll send you the recording.** --- ### Why you should attend: - Hear real-world examples from finance leaders who have fixed these challenges. - Learn how to build collaboration with Procurement (even if you’re doing both jobs yourself). - Get practical tips you can apply immediately to make your next budget cycle smoother. --- ### What this will help you solve: - Stop last-minute budget surprises by making contract visibility part of your process. - Turn spend data into forward-looking insights, not just after-the-fact approvals. - Identify and close process gaps that cause fire drills and wasted hours. This isn’t just another webinar - it’s your chance to rethink how budgeting gets done. Join us and leave with a framework to make your planning cleaner, faster, and far less painful. --- ### Meet the experts [**Nhat Vu**](https://www.linkedin.com/in/nhat-vu-980819160/) *Financial Planning Analyst, Transfr* With hands-on experience bridging financial planning and procurement, Nhat brings a practical lens to building cross-functional workflows that actually work - especially in fast-moving, high-growth environments. [**Matt Pringle**](https://www.linkedin.com/in/matthew-pringle-3b36813b/) *Director of Finance, Tropic* Matt helps drive Tropic’s internal financial strategy while shaping how the company enables smarter procurement for others. He’s all about connecting the dots between finance, ops, and procurement for better outcomes - and fewer headaches. --- ### About Tropic Tropic is your intelligent procurement partner, built to help modern finance and procurement teams save time, reduce costs, and drive results. Backed by $13B+ in software spend intelligence, Tropic delivers the visibility, automation, and leverage you need to turn procurement into a competitive advantage. Learn more at [tropicapp.io](https://tropicapp.io). ### Driving innovation: From CFO "no" to strategic growth partner URL: https://www.financealliance.io/cfo-no-to-strategic-growth-partner/ Last updated: 2025-07-30T10:30:10.000Z Let me share something that might sound familiar. There's a perception — one I've heard countless times in boardrooms and hallways— that finance is where innovation goes to die. The dreaded "CFO No." But what if I told you that's exactly the perception we need to flip on its head? I've spent over twenty years scaling organizations, from building the UK's largest telecoms company to helping Google Cloud grow from $12 billion to $48 billion. And here's what I've learned: finance isn't the brake pedal on innovation. It's actually the engine that makes sustainable growth possible. ## The evolution from challenger to champion You know what's interesting? As [finance leaders](https://www.financealliance.io/how-cfos-power-business-strategy/), we've been so good at being challengers — asking "what could go wrong?" and "how do we invest responsibly?" — that we've forgotten the other half of our role. We need to be champions too. Think about it. When was the last time you asked your business partners, "What gets you excited about this project?" or "How big can this really be?". These aren't just feel-good questions. They're strategic ones that build trust and credibility. Here's the thing: to truly influence your company's strategic direction, you need to immerse yourself in the business. Understand the market dynamics. Know the product inside and out. That's how you become a [thoughtful strategic partner](https://www.financealliance.io/how-to-improve-your-strategic-impact-in-finance/), not just a gatekeeper. ## Balancing growth and risk (without killing innovation) Now, I'm not saying we should say yes to everything. That would be irresponsible. Our primary role is still [balancing growth and risk](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/). But there's a smarter way to do it. Let me share a real example. When I first joined Google, I was asked to build a business case for insourcing — not outsourcing — thousands of customer support employees. My first reaction? Red flags everywhere. Higher costs, lower flexibility. This seemed crazy. But instead of shutting it down, I dug deeper. What I discovered changed everything. The complex customer support functions Google manages could actually be handled more efficiently in-house. Better time to resolution meant lower costs. Customer satisfaction would skyrocket. The upfront costs were real, but the long-term benefits were compelling. So what did we do? We didn't just say yes or no. Instead, we: - Ran [scenario planning](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/) and sensitivity analyses - Implemented a pilot program to test the waters - Created a staged funding model with clear milestones - Established go/no-go metrics at each phase That's how you manage risk while still enabling innovation. You're not closing doors—you're building better frameworks to walk through them. [Scenario planning: Navigate uncertainty with confidenceLearn about the key benefits of scenario planning and how it can be integrated into strategic and financial planning cycles.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-177.png)Finance AllianceCesar Gomez Nieto![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--1-2.png)](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/) ## Making innovation tangible: The Twitter data story Innovation isn't just about big ideas. It's about turning those ideas into real products and services. When I was at Twitter, we recognized the massive value in our real-time data. Developers were already using our APIs, but there was no monetization plan. As the finance team, we saw the opportunity. We built a pricing framework for API licensing and executed M&A transactions to fuel growth. But here's what made it work: First, we established a capital allocation framework. Everything started with strategy—what's the market potential? What do customers need? What are competitors doing? Then we built financial plans that reflected those inputs, understanding both the long-term revenue potential and the investment required. And here's something crucial: Today's environment is resource-constrained, meaning it's our job to push for efficiencies so we can invest in high-priority, high-growth areas. It's about being smart with resources, not cutting costs for the sake of it. ## Scaling innovation in large organizations You might think working at Google means unlimited resources and no problems. But large organizations are complex beasts. Sometimes our internal processes can slow us down more than any external factor. [The CFO's role in a large organizatio](https://www.financealliance.io/5-change-management-strategies-finance-transformation/)n is particularly challenging. We introduce processes to reduce risk, which can help or hinder innovation depending on how we implement them. Complex, bureaucratic processes and unclear ownership can kill innovation faster than any budget constraint. Where I've seen it work, finance acts like an air traffic controller. We understand all the different components of the business, navigate the bureaucratic processes, and pull everything together. We lead with data-driven decision making, always asking "what," "so what," and "what next?" Take data center buildouts, for example. They typically take five years to show returns. Finance teams that succeed here assess market growth, understand customer perspectives, and use financial analysis to provide clear recommendations. They set KPIs upfront and stick to them because changing metrics mid-project frustrates everyone and kills trust. ## Communicating innovation value to investors and boards Here's the tough part: explaining innovation to those holding the purse strings. I've found three approaches that work: ### Strategic Alignment Every innovation project needs to tie directly to your company's strategic objectives. When we built an object storage business at Hitachi, we evaluated fifty to sixty potential projects. Each one was assessed against clear criteria: ARR contribution, market expansion potential, customer stickiness. The winners aligned with our international expansion goals. ### Compelling Narratives Data alone isn't enough. In moments of uncertainty, emotion becomes a powerful tool. Tell a story your board can journey with. If it's an acquisition, how does it fill product gaps? Open new markets? Change your competitive position? Use visual aids. Make it real. ### Scenario Planning Show you've thought through multiple futures. What happens if a competitor launches six months before you? If your co-creation customer changes direction? Present a range of scenarios with action plans for each. Decision makers are more comfortable with calculated risks when they see you've considered what could go wrong and have mitigation plans ready. ## Building an innovative finance team Organizations are made of people. If you want an innovative finance function, you need innovative finance people. But here's something interesting—my strategic finance team? Many don't have traditional finance backgrounds. What I look for is curiosity. I can teach modeling. I can coach [financial analysis](https://www.financealliance.io/your-ultimate-guide-to-fp-a/). But I can't teach someone to ask those five, six, seven questions that get to the right answer. I need people who wake up excited to figure things out, who aren't satisfied until they understand the unit economics of every component. Passion matters too. Innovation, especially when it involves new, unproven ideas, is hard to execute. People will tell you no. You need team members with the tenacity to drive things forward and bring others along. ## The path forward We're in an interesting economic cycle. We've moved from growth at all costs to sustainable, efficient growth. This is actually an opportunity for finance to shine. We can help our organizations innovate smarter, not just faster. The key is being proactive. Build processes that scale with your business. Understand how innovation projects impact both business operations and finance processes. Don't wait until the CEO starts asking strategic questions to other teams because finance couldn't keep up. Remember, finance has the power to [influence your company's strategic direction](https://www.financealliance.io/spotting-strategic-opportunities-and-driving-business-growth/). But only if we evolve from being just challengers to being champions too. Only if we balance our natural risk management instincts with genuine curiosity about what's possible. So next time someone comes to you with an innovative idea, don't start with "no." Start with "tell me more." Ask what excites them. Understand the potential. Then use your financial expertise to find the smartest path forward. That's how we change the perception. That's how we become true strategic partners in innovation. And that's how finance drives the sustainable growth our organizations need to thrive. What innovation opportunity is sitting on your desk right now, waiting for a champion? --- ***This article is based on Kevwe's appearance at the Chief Finance Officer Summit, San Jose (2025). Pro+ members can watch the talk in full*** [***right here***](https://www.financealliance.io/cfo-summit-san-jose-2025-ondemand/)***.*** ## ### Predictive analytics in financial forecasting: An AI-driven approach URL: https://www.financealliance.io/implementing-predictive-analytics-in-financial-forecasting-an-ai-driven-approach/ Last updated: 2025-07-30T11:04:25.000Z Although traditional [financial forecasting methods](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/), such as Excel-based models and historical trend analysis, have made notable progress, these approaches often rely on manual inputs, are susceptible to human error, and fail to account for external variables that significantly influence performance. Moreover, they tend to focus on short-term horizons, making it difficult for businesses to anticipate and respond to evolving market trends, thus demonstrating the benefits of predictive analytics. Predictive analytics can address some of these shortcomings by leveraging large datasets, advanced statistical models, and [machine learning](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/) algorithms. ## What is predictive analytics? Predictive analytics involves using data, statistical techniques, and machine learning, along with predictive analytics tools and capabilities, to effectively predict future outcomes. In finance, it can be applied to: - Revenue trends - Customer acquisition - Inventory planning - Other areas where you want to increase predictability of outcomes Predictive analysis leverages statistical algorithms to enhance forecasting accuracy, enabling organizations to make more informed decisions and manage risks more effectively. Unlike traditional forecasting, which often relies on historical averages and linear assumptions, predictive analytics integrates a broader range of variables (both internal and external) for more dynamic and reliable forecasts. Predictive analytics allows you to make decisions about your execution plan that is grounded in quantitative analysis, which can lead to effective risk mitigation strategies . You can then incorporate these predicted outcomes into your financial forecasting and have higher confidence in what the future holds for your business. ## How does predictive analytics transform financial forecasting? ### Incorporating real-time data Forecasts update based on live data from sources such as sales pipelines, market conditions, and macroeconomic indicators. This does not need to be real-time or through a permanent integration. You can implement these in an monthly process. ### Identifying hidden patterns Machine learning algorithms detect complex relationships, such as seasonality or customer churn signals, that humans may miss. Usually, I find good operators know these things intuitively but predictive analytics gives the operator nuance, drivers of outcomes and greater confidence in their gut feeling. ### Running scenario simulations [Finance leaders](https://www.financealliance.io/top-10-cfo-skills/) can model various “what-if” scenarios to plan for different outcomes, such as cost increases or shifts in demand. Having a good [driver based financial forecast](https://www.financealliance.io/driver-based-planning-forecasting/) is a prerequisite to having the ability to do this, but if you have that in place you can leverage predicted inputs into your projections to produce forecasts that allow for scenario planning. ### Improving accuracy Studies show that leveraging predictive analytics can reduce forecast errors by 20 to 30 percent compared to traditional approaches, supporting more informed financial decisions and enabling organizations to generate more reliable financial outcomes. This is an interactive process. Don’t assume that you starting doing this and it works out of the gate. Give yourself a runway for improvements and create a process of continual improvement. ### Automating routine tasks AI-powered tools handle data aggregation, cleansing, and reporting, allowing finance teams to focus on strategic insights. [Agentic AI](https://en.wikipedia.org/wiki/Agentic%5FAI) can provide a path to automating some of these aspects of data management. --- [How FP&A Teams Build Budgets?Asif Masani breaks down budgets step-by-step, not just so you understand it, but so you can confidently explain it in your next FP&A interview.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-171.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--66--1.png)](https://www.financealliance.io/how-fp-a-teams-build-budgets-and-how-you-can-nail-this-in-interviews/) --- ## Core components of predictive financial analytics To implement predictive forecasting effectively, several key components must come together, with financial predictive analytics and [data analytics](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) serving as foundational elements for modern forecasting. These components are especially critical in [corporate finance](https://www.financealliance.io/10-structured-capital-strategies/), where advanced analytics drive better risk management, fraud prevention, and market trend forecasting. ### Data infrastructure and quality Reliable forecasting begins with high-quality, centralized data and accurate information. This includes internal financial metrics, customer behavior data, operational KPIs, and external economic indicators, as well as financial data and financial data analytics. In my experience, poor data quality is the single biggest obstacle to success. Many companies struggle with inconsistent data collection, siloed systems, and insufficient historical granularity. This can seem daunting to operators who are not data geeks or have limited resources. Here are a few things to keep in mind: - Don't let perfection be the enemy of the good. - Don’t front run this effort with a large data cleaning and repository creation exercise To do this, follow these suggestions: - Run sprints for improvement and plan out a process for improving your data. Get started using it and don’t let a formal repository be a bottleneck. - Use tools like Zapier, Make and N8N to create connections between disparate data souces - Leverage off-the-shelf [data management](https://www.financealliance.io/7-data-management-problems-and-solutions/) capabilities in Looker, PowerBI and Excel. ### Statistical and machine learning models Predictive models rely on advanced statistical algorithms to deliver accurate forecasts. Depending on the objective, different modeling techniques are used. For instance: - Time series models, such as ARIMA, are ideal for identifying trends and seasonality. - Machine learning algorithms and machine learning techniques, such as random forests or neural networks, can model complex, non-linear relationships. - Regression analysis is a standard statistical algorithm used for building predictive models by identifying relationships between variables and predicting numerical outcomes. - Cohort analysis is highly effective for predicting customer churn and lifetime value in subscription-based businesses. In these instances you might need different resources on your team. Here you should focus on the forecasting aspects that have the most volatility and the highest profit impact. Don’t waste your time implementing these techniques on elements of your forecasting that don’t move the business. Remember, you want to have high impact and value and that comes from aspects of your business that are hard to predict and consume or produce a volume of cash that matters. ### Real-time processing capabilities Modern businesses require forecasts that can be adjusted in real time, made possible by advanced predictive capabilities and data analytics. Whether due to shifting customer behavior or market volatility, continuous data integration ensures forecasts remain accurate and relevant. --- [Building flexibility into your financial strategyTD Bank’s Bill Fink shares how today’s CFOs can lead with foresight by building adaptable financial strategies rooted in data, planning, and cross-functional teamwork.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-172.png)Finance AllianceWilliam Fink![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--67--2-1.png)](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/) --- ## Implementation roadmap ### Step 1: Define forecasting objectives Start with high-impact use cases. Remember think about high volatility and high cash impact within categoreis such as: - [Revenue forecasting](https://www.financealliance.io/understanding-the-rule-of-78s-a-critical-tool-for-recurring-revenue-forecasting/) - Expense management - Cash flow modeling - Customer lifetime value - Churn risk analysis ### Step 2: Assess and clean your data Remember, don’t go for perfection. Go for usability and start using the data. Ensure that: - Historical data is accurate and complete. - Accurate data is maintained, including detailed records of customer’s payment history, to support evaluating customer creditworthiness. - Key metrics such as bookings or ARPU are clearly defined. - Relevant external data is integrated. ### Step 3: Choose the right tools Numerous platforms now offer accessible predictive analytics tools for financial companies and other industries, even for teams without in-house data scientists. Notable options that are inexpensive and readily available include: - PowerBI with PowerQuery - Excel with PowerQuery - Looker - Python or R - Ideal for custom modeling with the right technical talent. ### Step 4: Build and train the models Most tools offer pre-built templates. The process generally involves: - Ingesting and analyzing historical data to establish a foundation for accurate forecasting. - Identifying patterns in customer behavior, seasonality, and other factors. - Applying predictive models, such as machine learning or statistical models, to forecast [cash flows](https://www.financealliance.io/cash-flow-drivers-in-a-business/) and other key financial metrics. - Generating and validating predictions. ### Step 5: Align with stakeholders Educate your executive team about how models work and what assumptions they include. Share data-driven insights from predictive analytics to help inform decision-making. Make sure [key stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) who are more challenging to bring along see some of the work along the way. Always be prepared to discuss output results that conflict with conventional wisdom. ### Step 6: Monitor, iterate, and improve Regularly compare predictions to actuals, analyze variances, and recalibrate models. Establish a quarterly review cycle to maintain reliable financial forecasts. If you are doing monthly reforecasting for financial models, make sure you have the process and resources to update all of your input predictions. You can also set up your refresh cadence to be something different, just be as consistent as you can be. ## Technology stack and tool selection The best predictive analytics stack depends on your size, goals, and in-house expertise, especially since predictive analytics plays a critical role in [financial risk management](https://www.financealliance.io/ai-in-risk-management-how-banks-can-mitigate-fraud-and-financial-crimes/) when selecting a technology stack. ### Cloud-based analytics platforms Platforms such as AWS, Google Cloud, and [Microsoft Azure](https://www.financealliance.io/how-to-use-azure-openai-on-your-data-in-finance-fp-a/) provide scalable machine learning services, allowing financial institutions to leverage cloud-based platforms for advanced predictive analytics, including real-time data processing and model deployment. Any one of these provides great capabilities, I would choose one that is closest to the overall company tech stack, if not identical. ### Specialized financial tools Solutions like Anaplan, Workday Adaptive Planning, and Board combine traditional budgeting features with predictive modeling capabilities and advanced risk mitigation tools. These are ideal for finance teams that need out-of-the-box functionality. ### Open-source options Python, R, and platforms like H2O.ai offer maximum flexibility, making them popular choices for financial companies using open-source solutions for custom predictive analytics. These are best suited for organizations with technical resources seeking customizable solutions and control. --- [The secret to effective communication with the C-suiteIf you’ve ever wondered how finance can evolve from gatekeeper to strategic partner, this article offers the blueprint. You’ll get real-world takeaways on building influence, navigating complex stakeholder dynamics, and driving value without losing your voice.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-174.png)Finance AllianceNick Quiroz![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/wayfair.png)](https://www.financealliance.io/how-wayfair-made-me-rethink-everything-i-knew-about-finance/) --- ## Key applications of predictive analytics in finance Predictive analytics has become an essential tool for financial institutions, providing a wide range of applications that enable smarter, data-driven decision-making, including the ability to forecast market trends. By analyzing historical data and identifying patterns, predictive analytics models allow finance teams to forecast future outcomes and respond proactively to changing market conditions. One of the most impactful uses of predictive analytics in finance is credit risk management, where financial institutions assess the likelihood of customer default and make informed lending decisions. Cash flow forecasting is another critical application, allowing organizations to predict future cash inflows and outflows, optimize liquidity, and ensure financial stability. Additionally, predictive analytics supports portfolio optimization by analyzing market data and customer behavior to maximize returns and minimize risk. ## Case study: Predicting SaaS revenue with AI-driven forecasting ![AI-Driven Revenue Forecasting ](https://i0.wp.com/images.surferseo.art/15fdc111-aab3-4c2b-9143-c3e593fd5279.png?ssl=1) One of my SaaS clients struggled with revenue forecasting due to inconsistent renewal cycles and unpredictable churn. Although topline growth was strong, the finance team lacked confidence in MRR projections, which impacted sales strategy and hiring plans. By implementing a predictive analytics solution, they were able to forecast cash flows more accurately and model multiple financial scenarios, leading to valuable insights and improved revenue projections. ### Challenges identified: - Irregular renewal patterns, particularly in mid-market and smb segments. - Difficulty predicting churn, especially with usage-based billing. - Overreliance on static spreadsheets and lagging indicators. ### Solution implemented: We designed a predictive analytics solution tailored to their data environment. - Consolidated CRM, billing, and product usage data from HubSpot, Stripe, and Segment. - Applied machine learning to identify churn risk based on engagement, support tickets, billing anomalies, and feature usage, as well as to assess future financial risks using the analyzed data. - We developed a [13-Week cashflow projection](https://cfoproanalytics.com/case-studies/) for weekly cash planning. ### Results: - Forecast accuracy improved by 25 percent. - Early visibility into revenue risk enabled proactive retention strategies. - Leadership made better-informed budgeting and hiring decisions. This initiative not only improved forecasting. It elevated the company’s revenue operations from a reactive to a proactive approach. ### Conclusion Predictive analytics offers a powerful path to more accurate and responsive financial forecasting. To ensure future economic success, it is essential to leverage predictive analytics and understand how predictive analytics can be made core strategies. By adopting these approaches, organizations can improve decision-making, mitigate risks, and gain a competitive edge. ### How Wayfair made me rethink everything I knew about finance URL: https://www.financealliance.io/how-wayfair-made-me-rethink-everything-i-knew-about-finance/ Last updated: 2025-07-30T14:33:56.000Z Over the course of my career in finance, I’ve learned that the real challenge isn’t just about getting the numbers right, it’s about making them matter to the people around you. That means understanding what drives your stakeholders, how the business actually operates, and how to turn financial insight into something that moves strategy forward. What follows isn’t a step-by-step guide or a fixed model. It’s a practical framework shaped by experience, one that’s evolved across different companies, industries, and roles. Along the way, I’ve made my share of mistakes, but each one helped refine how I show up in the room, ask better questions, and ultimately, collaborate more effectively. This is a look at how finance can become a true partner in the business, not by leading with spreadsheets, but by leading with context, clarity, and purpose. ## Engaging with stakeholders in finance One of the most important things I’ve learned in finance (often the hard way) is that numbers alone don’t build trust, alignment, or momentum. What does is *context*. And by context, I don’t just mean having a general sense of what the company does. I mean really understanding the industry, how it operates, and how the people around me think about the business. Too often in finance, there’s a tendency to get laser-focused on the data itself. But without connecting that data to what’s actually happening on the ground, whether that’s market trends, internal dynamics, or broader business goals, those numbers can quickly become disconnected and even irrelevant. ![Nick Quiroz quote](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/07/nick-quote-2.png) Here's what I focus on when working with stakeholders: ### 1\. Context So when I work with stakeholders, especially those outside of finance, my first priority is to understand the landscape. - *What’s moving the business?* - *What’s keeping this person up at night?* - *What are they really trying to achieve?* Once I have that perspective, I can [translate financial insights](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/) into a language that resonates with them. Not accounting jargon or rows and columns. But something that feels relevant and actionable to their world. ### 2\. Purpose The second thing I focus on is purpose. Before diving into analysis or offering solutions, I take a beat to ask: - Why are we having this conversation? - What problem are we actually trying to solve together? Without that shared clarity, it’s easy to throw around data points or recommendations that might totally miss the mark. ### 3\. Ownership Next is ownership. Who is the ultimate owner of the issue we’re addressing? It’s not always the person sitting across the table from me. Sometimes they’re the messenger, sometimes they’re one piece of a bigger puzzle. Knowing who’s actually driving the decision or setting the agenda changes how I approach the conversation, and helps avoid spinning in circles. ### 4\. Strategic fit Finally, I always try to zoom out and connect whatever we’re working on to the [bigger picture](https://www.financealliance.io/10-big-picture-financial-planning-steps/): strategy, execution, company goals. If the initiative isn’t aligned to where the business is going, then it’s either a distraction or it needs to be reframed. But that alignment doesn’t happen by accident. It comes from being intentional in how I approach problems and the people behind them. I didn’t figure any of this out on day one. Like most people, I learned through experience and by making mistakes, running into resistance, and gradually realizing what worked and what didn’t. Over time, these four ideas - **context, purpose, ownership, and strategic fit -** have become the foundation of how I build relationships and drive outcomes in finance. --- [Building flexibility into your financial strategyTD Bank’s Bill Fink shares how today’s CFOs can lead with foresight by building adaptable financial strategies rooted in data, planning, and cross-functional teamwork.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-168.png)Finance AllianceWilliam Fink![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--67--2.png)](https://www.financealliance.io/building-flexibility-into-your-financial-strategy/) --- ## The “empowered finance” model at Siemens Early in my career at Siemens, I worked in what I’d call an *empowered finance* model. At the time, Siemens operated with dual leadership at every business unit, each had a [CEO and a CFO](https://www.financealliance.io/how-to-gain-and-sustain-ceo-sponsorship/) as equals. Decisions were made jointly, and neither role reported to the other. That structure extended all the way down the organization, meaning even as a finance analyst, you were part of a function that had a clear and independent seat at the table. There were real benefits to this setup. Most notably, finance had influence by design. You didn’t have to fight to be heard. You were already in the room. But with that influence came challenges. Over time, I realized that what felt like empowerment could also lead to gridlock. For example: - A CFO might say no to a new initiative due to short-term cost concerns. - A CEO might say yes, seeing the long-term strategic upside. The result? A standoff that halted momentum entirely. This tension made it difficult to experiment, iterate, or take calculated risks, especially when finance leaned heavily toward control rather than enablement. From today’s perspective, I see that model as limiting in ways I couldn’t appreciate back then. Yes, finance was empowered, but sometimes that empowerment became a barrier. I even found myself, in some cases, blocking decisions I now think would’ve been worth testing. The key takeaway for me: having a seat at the table is only valuable if you’re helping the business move forward. Influence means little if it's disconnected from strategic growth. ## Challenges in sponsored finance After Siemens, I joined a semiconductor manufacturer in Massachusetts. My mandate, backed by a single C-level sponsor, was simple on paper: **fix our top-line forecast** and win back credibility in the highly scrutinized automotive market. What unfolded taught me a few lasting lessons about sponsorship, collaboration, and blind spots. #### What worked - **Clear air cover.** With an executive champion, I could move fast and built a small commercial-finance team, centralised 45 disparate marketing forecasts, and pushed a unit-based planning model that finally tied revenue to real production volumes. - **Tangible impact.** [Forecast accuracy](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) went up, investors noticed, and for a while the function became a trusted source of truth. #### What didn’t - **One sponsor ≠ one stakeholder.** While I focused on my champion, I missed early signals from the CFO and COO, who both depended on the same data for P&L and supply-demand planning. My “finance fix” was really an end-to-end demand-planning problem, but I treated it as a silo. - **Confrontation over collaboration.** Centralising knowledge meant asking marketers to give up their own methods. Resistance was inevitable, and I met it head-on instead of bringing people into the process. We won the battle, but frayed some relationships. - **Legacy risk.** When I left, the team I’d built split in two—demand planning went to Operations, revenue analytics stayed in Finance. The system worked, yet the integrated vision didn’t survive the org chart shuffle. #### Takeaways I still use 1. **Multiple sponsors beat a single champion.** Broaden the coalition early - especially when your output touches both the top line *and* the factory floor. 2. **Translate your mandate.** “Improve the forecast” was really “balance demand, inventory, and cash.” Naming the wider problem would have aligned more people, faster. 3. **Centralise with empathy.** People surrendering local tools need to see how the new approach serves them, not just the balance sheet. The project proved that good finance can restore trust, but great finance builds systems and relationships that outlast the person who designed them. --- [Investor relations as a strategic driver of corporate valueIn this article, we explore how IR officers and finance professionals can achieve that goal in a more efficient manner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-169.png)Finance AllianceDerrick Bonyuet, PhD, CFA, CFP, CPA![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--65--1.png)](https://www.financealliance.io/investor-relations-as-a-strategic-driver-of-corporate-value/) --- ## Collaborative finance at Wayfair ![Collaborative finance quote from Nick Quiroz](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/07/nick-quote-1.png) Today, I’m at Wayfair and the environment here has reshaped how I think about [finance as a function](https://www.financealliance.io/building-an-fp-a-function-strategies-for-effective-team-and-organizational-structure/). I came in with the mindset of “let me show you how finance is done.” But I quickly learned that’s not how things work here. At Wayfair, finance is a partner, not a referee. Collaboration isn’t a buzzword, it’s baked into how decisions get made. One of the clearest examples of this came almost immediately after I joined. I was told, “We need to implement budgets.” And my first reaction was: how does a twenty-year-old tech company not already have budgets? What I discovered is that Wayfair *does* have budgets, just not in the traditional, [top-down finance](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) sense. Here, budgeting is about allocating spend to key decision-makers and trusting them to use that envelope wisely. It’s less about control, more about enablement. This shift became necessary as [economic conditions](https://www.financealliance.io/what-is-economic-analysis-the-question-every-cfo-should-be-asking/) tightened in 2022, interest rates went up, capital got expensive, and spending needed to be reined in. But instead of imposing rigid limits, we built a structure that supported smart decision-making on: - Compensation - Outsourced labor - Software spend Each budget owner became responsible for managing their slice of the business, and our role in finance was to guide, inform, and partner with them, *not* to dictate. It was a clear lesson in [collaborative finance](https://www.financealliance.io/cross-functional-collaboration-as-an-fp-a-lead/): success didn’t come from enforcing rules, but from empowering people with the right tools and context to make the best choices for the company. ## Wayfair’s unique business model Wayfair is, at its core, a tech company. We don’t hold inventory. Instead, we provide the platform where vendors sell their furniture, much like Amazon’s marketplace model. That means our biggest costs aren’t tied up in warehousing or logistics. Outside of marketing, our major expense is people. That’s why [budgeting](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) at Wayfair is centered around headcount, outsourced labor, and software. It’s not about imposing limits, but helping our 45+ budget owners make thoughtful decisions. My role is to support them, explain the “why” behind the structure, and make sure the tools we’ve built actually help the business run better. The impact has been real. Budgets became essential as we worked through cost reductions and focused on getting back to profitability, which we achieved in 2023, on our own terms, without outside capital. ## Collaboration over control One of the biggest takeaways from my time at Wayfair is this: finance has to prove its value. It doesn’t get a [seat at the table](https://www.financealliance.io/how-to-get-a-seat-at-the-table/) just for showing up. That value comes through active collaboration, not control. There’s a common misconception, especially from past experiences people have had, that finance “owns the money.” I hear it sometimes - people assume I’m the one holding the purse strings. But that’s not how it works. Nobody at the company owns anything in isolation. Success comes when we all move in sync toward shared goals, not when any one function calls the shots. That philosophy even extends to things like travel. We work in-office four days a week, but with teams spread across global locations, we’ve prioritized travel as a tool for collaboration. We use a platform called Trevo to enable that, and deliberately chose not to put hard budget caps on it. Why? Because limiting travel would actually limit the kind of teamwork we’re trying to encourage. And so far, people have used it responsibly, which is another example of trust leading to better outcomes. Finance isn’t here to say no. It’s here to help teams focus on what matters, and to create the space where collaboration can actually thrive. --- [CFO vs. Controller: What’s the difference?In this article, we’re going to try to clear up the confusion. We’ll look at how CFOs and Controllers contribute to a company’s financial health, what their day-to-day responsibilities look like, and why both roles are crucial for businesses of all sizes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-170.png)Finance AllianceElla Harrison![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/CFO-vs-controller-2-2.png)](https://www.financealliance.io/cfo-vs-controller/) --- ## Stakeholder alignment and strategic focus At Wayfair, budgeting is a collaborative process, and it only works when I understand what truly drives the people I’m working with. That means being tuned into the industry on both a macro and micro level. What’s happening in the broader economy? How might it affect consumer behavior? And just as importantly, how are individual teams thinking about their challenges and goals? When I assign a budget, I’m not just handing over a number. I’m starting a conversation. Often, that leads to creative problem solving - shifting unused headcount budget to fund a software investment, for example, or reallocating spend to unlock more efficiency. The ownership doesn’t sit with finance. It sits with the budget owners themselves. My role is to support them in using their resources wisely. The objective is clear: profitability. That’s been our north star since 2023, and we’ve stayed focused on delivering it quarter after quarter. But profitability doesn’t happen in a vacuum, it happens when strategy drives decisions, and when finance helps translate that strategy into meaningful, actionable plans. If there’s one principle that ties all of this together, it’s this: **know your industry, and let the strategy generate the numbers.** Don’t throw metrics at people and expect them to connect the dots. Anchor the conversation in what matters to them - what they’re trying to achieve - and make the numbers work in service of that. That’s how finance becomes a partner. Not by owning the outcome, but by enabling it. ## Creating value through collaboration At the end of the day, value creation is what it’s all about. That’s true across every role I’ve had, but especially now at Wayfair. And for me, value isn’t just measured in numbers. It also shows up in how we work together. I’ve learned that collaboration (not confrontation) is where the real progress happens. The most effective finance work I’ve been a part of wasn’t about control or authority. It was about aligning with others, [sharing accountability](https://www.financealliance.io/financial-accountability/), and making room for smarter, better decisions. And honestly, that’s where the fun is too. I genuinely enjoy what I do, and a big part of that is working with people who trust each other enough to solve problems together. Finance doesn’t need to be a blocker. It can be an enabler. But only if we show up that way. Looking back, even to earlier experiences like Siemens’ dual-leadership model, I’ve seen what happens when decision-making gets stuck. It reinforced something that’s stayed with me: alignment matters. If finance and leadership aren’t moving together, nothing moves at all. So whatever framework you follow, whatever company you’re in, the real goal is simple: know your business, work with your people, and let the strategy guide the numbers, not the other way around. ## Lessons from dual leadership Siemens eventually moved away from the dual leadership structure, and for good reason. For those who remember, the 2008 corruption scandal had roots in that system, where finance leaders operated too independently and without enough oversight. I won’t go into the full details here, but it’s well-documented, and the company ultimately shifted to a more traditional model: one CEO, one CFO, with clear lines of reporting. From my vantage point at the time, the dual structure felt empowering. But looking back, it had its limits. One big drawback was the rigidity it created. For example, at Wayfair today, we can experiment - reallocate some marketing spend to test a new initiative, pivot quickly, and learn from it. In the Siemens model, that level of agility would’ve been difficult, if not impossible, due to the need for full alignment between two leaders who didn’t report to each other. What felt like empowerment then, I now see as something more restrictive. ## Aligning with business partners When it comes to [aligning with stakeholders](https://www.financealliance.io/stakeholder-communication-plan/), especially when there’s disagreement around cost optimization, the best tool I have is data. A good example is software renewals. At Wayfair, we review every renewal through a very specific lens: - How many licenses are we paying for? - How much are we actually using? - Has headcount changed since the last cycle? When usage drops, the data gives us a clear story to take to the owner of that software. It’s not about saying “cut this” arbitrarily, it’s about showing them the numbers and empowering them to renegotiate with vendors based on real need. This approach shifts the conversation from resistance to partnership. The numbers help clarify the opportunity, but the real goal is shared accountability in finding a smarter, more efficient path forward. --- ### Want more insights like this? Join our free Insider membership and go deeper with the tools, templates, and real-world lessons shaping today’s most forward-thinking finance teams. **Here’s what you’ll get as an Insider:** 📑 **Ready-to-use templates** to save time and drive impact. ✍️ **Exclusive content** from top industry voices. 📺 **Case studies** featuring leaders from Adobe, Salesforce, Virgin Galactic, and more. 📚 **Instant access** to expert reports - no forms, no friction. ...and more! Join free today and start applying what the best in the business are already using. [Become an Insider](https://www.financealliance.io/insider-membership-plan/) ### How FP&A teams build budgets (and how you can nail this in interviews) URL: https://www.financealliance.io/how-fp-a-teams-build-budgets-and-how-you-can-nail-this-in-interviews/ Last updated: 2025-10-08T09:05:55.000Z Most companies spend two to three months building their annual budgets, but ever wondered what actually happens during that time? Let’s break it down step-by-step, not just so you understand it, but so you can confidently explain it in your next FP&A interview. ## Why it matters Interviewers love asking about budgeting because it reveals if you get the *big picture*. Can you manage timelines, align cross-functional teams, and make the numbers work? Whether you’ve done budgeting before or you’re just getting started, this guide will walk you through how it really works in practice. ## Common interview variation questions you might hear - *“Walk me through your budgeting process.”* - *“How do you ensure alignment across departments?”* - *“How do you handle unrealistic asks from teams?”* - *“What’s your role in finalizing the budget?”* - *“How do you ensure assumptions are accurate and consistent?”* --- [CapEx vs Opex | Key differences, examples & why it mattersMaster the difference between CapEx and OpEx to optimize budgeting and drive growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-160.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/capex-vs-opex.png)](https://www.financealliance.io/capex-vs-opex/) --- ## The 3-phase budgeting process FP&A teams usually go through three key phases: 1. **Planning phase:** Guidelines, timelines, and guardrails. 2. **Execution phase:** Inputs, assumptions, and consolidation. 3. **Review phase:** Leadership alignment and board approval. ![Article content](https://media.licdn.com/dms/image/v2/D4D12AQFCWuNTyKXBvQ/article-inline_image-shrink_1500_2232/B4DZaQkPcbGsAU-/0/1746182142485?e=1752105600&v=beta&t=DIhKBu54T9Oy6QibvKHcep7sku4Po_RcG97yT1412NI) Let’s dive in. ### Step 1: Planning phase This phase sets the tone. Get this right, and the rest becomes manageable. **Key elements:** - **Budget calendar:** Start with the Board approval date (often Nov/Dec), then work backwards to set all other milestones. - **Budget guidelines:** Clear rules like “no custom Excel sheets,” “justify large increases,” and “no last-minute changes without CFO sign-off.” It’s like prepping for a major exam: everyone needs to know the syllabus and the timeline. ### Step 2: Execution phase This is where the action starts. **What FP&A does:** - **Design templates:** Pre-filled with historical, locked formulas, tailored per team. - **Kick-off meetings:** Clear instructions, assumptions (e.g., inflation, FX, salary hikes), and examples. - **Weekly check-ins:** Keep departments on track and troubleshoot early. - **Collect inputs:** Not just numbers, but also assumptions and justifications to ensure alignment with strategy. Remember, it’s not just a spreadsheet task. It’s about connecting the “what” with the “why.” ### Step 3: Review & consolidation phase This is where [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) pulls everything together and the back-and-forth begins. **Key activities:** - **Consolidate data:** Combine all department budgets and analyse variances against top-down targets. - **Review rounds:** With business heads, FP&A leadership, CFO, and eventually the CEO. - **Scenario planning:** Base case, best case, worst case - show risks, opportunities, and trade-offs. Eventually, the final version is reviewed by the Board. They might not change numbers, but they’ll definitely challenge your assumptions. --- [Investor relations as a strategic driver of corporate valueIn this article, we explore how IR officers and finance professionals can achieve that goal in a more efficient manner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-161.png)Finance AllianceDerrick Bonyuet, PhD, CFA, CFP, CPA![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--65-.png)](https://www.financealliance.io/investor-relations-as-a-strategic-driver-of-corporate-value/) --- ## FP&A’s role = More than just numbers FP&A wears many hats during budgeting: - **Project managers:** Keeping the process on track. - **Advisors:** Aligning plans with business strategy. - **Challengers:** Pushing back on weak assumptions. - **Negotiators:** Bridging gaps between teams and leadership. - **Storytellers:** Presenting a narrative that informs smart decisions. ## Best practices to mention in interviews - Set clear timelines and ownership. - Align all teams on shared assumptions. - Use historical data to challenge inflated asks. - Maintain version control and documentation. - Always explain the “why” behind the numbers. ### Handling follow-up questions **Q: What if departments inflate their budgets?** Ask for justifications, use benchmarks, and push back on weak assumptions. **Q: What if the total budget exceeds top-down targets?** Run scenarios, highlight gaps, and help leadership prioritize. **Q: What tools do you use?** Depends. Some use Excel, others use tools like Anaplan, Adaptive, or Workday. ### ### ### ### Navigating financial uncertainty URL: https://www.financealliance.io/navigating-financial-uncertainty/ Last updated: 2025-08-05T12:12:50.000Z FAnow is your chance to stream exclusive talks and presentations, hosted by finance experts and industry leaders. It's a unique opportunity to watch the most sought-after finance content – ordinarily reserved for FA Pro members. Each stream delves deep into a key finance topic, industry trend, or case study. Simply sign up to watch any of our upcoming live sessions. 🎥 Access exclusive talks and presentations ✅ Develop your understanding of key topics and trends 🗣 Hear from experienced finance leaders 👨‍💻 Enjoy regular in-depth sessions --- **Date:** July 31, 2025 **Time:** 5:00pm BST **Location:** Online [Watch OnDemand](https://www.financealliance.io/fpa-summit-san-jose-2025-ondemand-2/?wchannelid=dn9m8gm8hh&wmediaid=wsx7upvcm3) In this insightful session, the speaker - an experienced finance strategy leader - underscored the critical role of networking and engagement during times of economic uncertainty. Drawing on a cross-sector background, they emphasized the importance of understanding the political and macroeconomic landscape to inform agile and resilient planning. --- ### Key takeaways: - The regulatory and ROI implications of the new administration - Monitoring vital indicators such as the 10-year yield, VIX, and CPI - The need for adaptability in planning and clear internal communication --- ### Meet the speaker: [**Manadeep Raje**](https://www.linkedin.com/in/manadeepraje/), Founder, The Finance Pro **Manadeep Raje** is a seasoned finance professional with expereince serving as an FP&A (Financial Planning & Analysis) Manager at Sensor Tower. He brings extensive experience in financial strategy, budgeting, and analysis to the role. A Certified Practising Accountant (CPA) accredited by CPA Australia since August 2010, Manadeep demonstrates a strong foundation in governance, compliance, and best practices in financial management. He regularly shares industry insights and thought leadership on LinkedIn—covering topics from fintech and macroeconomic trends to career development in finance—building a following of over 1,600 professionals . ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/07/image.png) ### ### Investor relations as a strategic driver of corporate value URL: https://www.financealliance.io/investor-relations-as-a-strategic-driver-of-corporate-value/ Last updated: 2025-07-29T10:01:02.000Z The investor relations (IR) function holds a unique role in any organization as their responsibilities are not related to the product or service being sold but rather serving as the primary channel of communication with the financial community. More importantly, the role of Investor Relations (IR) officers has evolved to a greater extent that it has become an agent of value creation. In this article, we explore how IR officers and finance professionals can achieve that goal in a more efficient manner. ## **Background of IR in corporate finance** There is no doubt IR function plays a fundamental role in corporate finance. IR officers’ primary responsibility is to manage the communication process with the investment community and in doing so, shape the narrative to ensure information is properly assimilated by all [financial market stakeholders](https://www.financealliance.io/stakeholder-communication-plan/). More importantly, IR officers must communicate with the [financial community](https://www.financealliance.io/community/) on a proactive basis. According to Bain & Company, a consulting firm, those companies that take a passive approach to investor relations, not only often experience a decline in perceived value but are also more likely to be subject to investor activism (Keuer, Shen, Suzuki & Dingermann, 2018). Corporations must be vigilant as S&P Global, a research agency, has noted increasing investor activism over the past five years (Lilly, 2023). ## **Value creation techniques** IR officers can use different techniques to create value in a more efficient manner. These techniques range from understanding the firm’s intrinsic value to better investor selection. ### 1\. Define firm’s intrinsic value Having a solid understanding of the company’s intrinsic value should be the first task in any IR officer’s priority list. By doing so, a well-grounded valuation of the company can be established. ### 2\. Understand the gap between intrinsic value and stock price Once the intrinsic value has been determined, IR officers must identify what is driving the gap between this value and the stock price. There may be the possibility that investors do not have a clear understanding of [company’s profitability](https://www.financealliance.io/why-cfos-need-to-be-people-managers/) by segment along the growth projections for each segment and how that compare to its peers. --- [What is a compliance report: A guide on compliance reportingA clear, no-fluff guide to compliance reporting for finance teams who do it all.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-155.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/compliance-report-blog-meta-2.png)](https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/) --- ### 3\. Perform investor segmentation Investor landscape must be properly segmented to ensure investors’ different needs can be addressed. Investors have traditionally segmented into groups like growth vs. value investors, or institutional vs. retail investors. A better segmentation approach would focus on identifying those investors who can truly move the stock price while influencing other investors, keep a long-term investment horizon, and align with company’s strategic objectives. According to McKinsey, a consulting firm, investors can be broken into three groups: intrinsic investors, trading-oriented investors, and mechanical investors (Palter, Rehm & Shih, 2008). - Intrinsic investors perform [solid due diligence](https://www.financealliance.io/finance-and-compliance/) before taking a position in a company’s stock. Their investment horizon is long and their trades are large. As a result, intrinsic investors may influence the stock price relative to its intrinsic value. - Mechanical investors make decisions based on criteria or rules using computer-based models. Due to their investing approach, IR officers may not be able to influence their trades. - Traders represent investment professionals who take a short-term position to make a quick profit. As a result, IR officers may not want to devote time to these investors as their fast trade turnover may increase stock volatility. ### 4\. Attract the right investors Once investors have been properly segmented, IR officers want to focus on the right investor mix that will allow them to lower the [company’s cost of capital](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/), contribute to share price stabilization, and enable a more efficient relationship management. ### 5\. Review the narrative to ensure it is convincing, consistent and cohesive A huge role in the IR function is to drive the narrative so information can be properly assimilated by all financial market players. IR officers must ensure their narrative is convincing. This means their narrative must make sense based on facts and financial data. The narrative must also be consistent with each investor’s need and be cohesive, which means it should stick to the company’s strategy or otherwise, it will fail. By keeping a convincing, consistent and cohesive narrative, negative outcomes can be most likely avoided (Desjardine, 2024). ### 6\. Make an efficient use of technology Most companies offer a dedicated IR website or even a portal to their investors where press releases, and filings (e.g., 10-Ks, 10-Qs) are distributed along with detailed financial and operational information. However, many firms have not been able to leverage the recent technological advancements, such as data analytics, CRM systems and AI tools. These tools can enable more efficient interactions with customers while monitoring their activity and collecting their feedback. More importantly, AI-driven chatbots can address common investor questions in real-time while improving accessibility and efficiency. --- [Tariff impact: Beyond headlines to the P&L reality for emerging businessesDiscover expert insights into the actual P&L impact and management decisions that go into maneuvering these uncertainties and increased costs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-156.png)Finance AllianceSalvatore Tirabassi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--63--1.png)](https://www.financealliance.io/tariff-impact-beyond-headlines-to-the-p-l-reality-for-emerging-businesses/) --- ### **Conclusion** The role of Investor Relations (IR) has evolved beyond just communication, it is a critical driver of value creation for firms. By fostering transparency, supporting strategic initiatives, attracting the right investors, ensuring adequate governance and compliance, and addressing crisis management, IR officers have become indispensable players between companies and the financial community. To create value more efficiently, IR officers must understand their firm’s intrinsic value, bridge gaps in market perception, and segment investors to target those who will contribute to long-term stability and growth. Leveraging technology and refining their communication strategy also ensures IR officers can achieve their goal in a more efficient manner. --- ### **References** Desjardine (July-August 2024). *How to respond to shareholder activism*. Harvard Business Review, pp 115-122\. Available [How to Respond to Shareholder Activism](https://hbr.org/2024/07/how-to-respond-to-shareholder-activism) DesJardine & Shi (2023). *How to attract the right shareholders.* Harvard Business Review. Available Keuer, Shen, Suzuki & Dingermann (2018). *How a strategic approach to investor relations can unlock intrinsic value.* Bain & Company. Available [How a Strategic Approach to Investor Relations Can Unlock Intrinsic Value | Bain & Company](https://www.bain.com/how-we-help/how-a-strategic-approach-to-investor-relations-can-unlock-intrinsic-value/) Lilly (December 2023). *Evolution of Investor Activism: What’s Driving Continued Activity?* S&P Global. Available Palter, Rehm & Shih (2008). *Communicating with the right investors. Perspectives on Corporate Finance and Strategy.* McKinsey, 27\. Available [Communicating with the right investors | McKinsey](https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/our-insights/communicating-with-the-right-investors) ### What is a compliance report (and why should finance care)? URL: https://www.financealliance.io/what-is-a-compliance-report-compliance-reporting-finance/ Last updated: 2025-10-08T09:05:51.000Z Ever wonder what could actually happen if a company doesn’t follow the rules? Like…what if all that talk about compliance isn't just red tape but something that could land your business in real trouble? Well, here’s the thing: it’s not just a “what if.” According to research into the [state of risk and compliance](https://www.navex.com/en-us/resources/benchmarking-reports/state-risk-compliance/), nearly one in five of those surveyed said their company faced legal or regulatory action in the last three years. That’s not a small number, and it wasn’t because they forgot to file one form. Not only that, but it was the third most common compliance issue reported. The truth is that compliance reporting isn’t just about lawyers and legal departments. Finance pros are often right in the middle of it. They pull the numbers, track the spending, and help prove that everything’s above board. If the reports are wrong or missing? That’s when things can spiral. Compliance reporting isn’t just about checking boxes, it’s about building trust and reducing risk. Keep reading to learn more about what a compliance report actually is, why it’s more important than most people think, and how finance teams end up doing *a lot* more than just crunching numbers. --- **What you'll learn from this guide:** - [What a compliance report is](https://www.financealliance.io/p/eca75a77-bb55-4e5d-bbc1-e0b69743a401/?member%5Fstatus=anonymous#%3Cstrong%3Ewhat-is-a-compliance-report?%3C/strong%3E) - [Benefits of compliance reporting](https://www.financealliance.io/p/eca75a77-bb55-4e5d-bbc1-e0b69743a401/?member%5Fstatus=anonymous#%3Cstrong%3Ebenefits-of-compliance-reporting %3C/strong%3E) - [Types of compliance reports](https://www.financealliance.io/p/eca75a77-bb55-4e5d-bbc1-e0b69743a401/?member%5Fstatus=anonymous#%3Cstrong%3Etypes-of-compliance-reports%3C/strong%3E) - [What's included in one](https://www.financealliance.io/p/eca75a77-bb55-4e5d-bbc1-e0b69743a401/?member%5Fstatus=anonymous#%3Cstrong%3Ewhat%E2%80%99s-included-in-a-compliance-report?%3C/strong%3E) - [Compliance in finance](https://www.financealliance.io/p/eca75a77-bb55-4e5d-bbc1-e0b69743a401/?member%5Fstatus=anonymous#%3Cstrong%3Ewhat-is-compliance-in-finance? %3C/strong%3E) - [Compliance tracking and reporting](https://www.financealliance.io/p/eca75a77-bb55-4e5d-bbc1-e0b69743a401/?member%5Fstatus=anonymous#%3Cstrong%3Ecompliance-tracking-and-reporting%3C/strong%3E) - [How to create a compliance report](https://www.financealliance.io/p/eca75a77-bb55-4e5d-bbc1-e0b69743a401/?member%5Fstatus=anonymous#%3Cstrong%3Ehow-to-create-a-compliance-report%3C/strong%3E) - [FAQs](https://www.financealliance.io/p/eca75a77-bb55-4e5d-bbc1-e0b69743a401/?member%5Fstatus=anonymous#%3Cstrong%3Efaqs%3C/strong%3E) --- ## **What is a compliance report?** A compliance report is a clear, no-fluff document that shows how your company is following the rules. These could include local laws, industry standards, or internal policies, etc. Compliance reports answer questions like: - Are we meeting the rules we’re supposed to? - Where are we slipping up? - What are we doing to fix it? A solid compliance report shows what’s working, what’s not, and (this is key) what you’re actually doing about it. They help your team stay accountable, avoid fines, and build trust with regulators, clients, and leadership. Basically, it’s how you prove you’re *not* cutting corners. --- ## **Benefits of compliance reporting** Compliance reporting offers a wide range of benefits for businesses, extending far beyond simply avoiding penalties. Here are the key advantages: ![Benefits of compliance reporting](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/Benefits-of-compliance-reporting-2.png) ### Avoids legal trouble and penalties This is the most direct benefit. Regular and accurate [compliance](https://www.financealliance.io/finance-and-compliance/) reports demonstrate adherence to laws, regulations, and industry standards, significantly reducing the risk of fines, lawsuits, and other legal repercussions. ### Spot problems early Compliance reporting forces you to dig into the details, which is a good thing because it helps you catch risks, errors, or shady behavior early. You know, *before* they turn into costly issues? ### Builds trust and reputation Transparency in compliance efforts [fosters trust with all stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) – customers, investors, employees, and regulators. A company that consistently demonstrates its commitment to ethical practices and regulatory adherence builds a strong, positive reputation, which can attract more business and investment. ### Improve internal processes Compliance reporting shines a light on what’s working, and what’s not. If you’re constantly flagging the same issue, it might be time to rethink the process behind it. ### Keep your team aligned and accountable When you’re regularly reporting on compliance, people pay attention. Teams know what’s expected, what’s being measured, and what needs fixing. ### Boosts financial integrity and investor confidence Especially for financial compliance, accurate reporting ensures that a company's financial practices align with accepted standards and regulations. This provides [investors and auditors](https://www.financealliance.io/cfos-role-in-investor-communications/) with the necessary information to assess financial health, leading to increased confidence. ### Facilitates better decision-making Compliance reports provide valuable insights into an organization's overall health and risk profile. This data empowers leaders to make more informed strategic decisions about [resource allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), future planning, and risk mitigation. --- [The CFO’s crash course in finance and complianceGovernance, risk management and compliance. These aren’t exactly the most exciting aspects of a CFO’s role, but that doesn’t stop them from being vital areas of focus. 🎯![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-152.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_3_compliance-2.jpg)](https://www.financealliance.io/finance-and-compliance/) --- ## **Types of compliance reports** Understanding the different types of compliance reporting helps you stay ahead of deadlines, avoid duplication, and make sure the right data gets to the right people. Here are five of the most common types of compliance reports you'll come across and finance's role in preparing or contributing to them: ### 1\. Regulatory compliance reports Regulatory reports are submitted to government agencies or industry bodies to prove you're meeting the legal requirements tied to your business. They vary depending on your industry but often include things like tax filings, AML reports, or disclosures under SOX or GDPR. ****Finance’s role:** These reports need accurate, audit-ready numbers. Late or inaccurate submissions can trigger investigations, fines, or worse. ### 2\. Financial compliance reports These reports focus on how well your financial practices align with rules and standards, including both external (like GAAP or IFRS) and internal ones. They’re often reviewed by auditors, execs, or boards to check that your books are clean and your controls are solid. ****Finance’s role**: This is your home turf. From income statements to control testing, you’re likely the one building, reviewing, and explaining what’s inside these reports. ### 3\. IT compliance reports Technology touches every part of your business and so do the risks. IT compliance reports show how your systems are protected, how data is secured, and whether you’re meeting [cybersecurity](https://www.financealliance.io/cfo-cybersecurity/) standards like SOC 2 or ISO 27001. ****Finance’s role:** You might not manage firewalls, but you handle sensitive financial data. If your systems aren’t secure, the finance team is one of the biggest targets for cyber threats. Knowing how your data is protected matters. ### 4\. Operational compliance reports These reports track whether [business processes](https://www.financealliance.io/17-finance-business-processes/) are running in line with internal rules and external expectations. This might include things like procurement controls, vendor oversight, employee conduct policies, or [supply chain](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) compliance. ****Finance’s role:** Think invoice approvals, contract compliance, or vendor payments. You help keep operations aligned with policy and catch red flags before they become real risks. ### 5\. Data privacy compliance reports Privacy regulations like GDPR, CCPA, and HIPAA have raised the bar on how businesses collect, use, and protect personal data. These reports demonstrate that you’re handling sensitive info (including customer and employee data) properly and transparently. ****Finance’s role:** Payment data, customer billing info and payroll details all flow through finance. That means you need to know where data lives, who has access, and how it’s being protected. ## **What’s included in a compliance report?** If you work in finance, chances are you’ve touched parts of a compliance report at one time or another. Budgets, audit trails, expense records, financial controls… they all feed into the bigger picture. So, knowing what goes into these reports isn’t just useful, but essential to compliance in finance. Here’s a simple overview of what’s actually inside compliance reports: ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/Anatomy-of-a-compliance-report-2.png) ### 1\. Purpose & scope First, you define what the report covers and what you’re reporting on. Is it about data privacy? Financial reporting? Environmental regulations? This is to help readers know what to expect. ### 2\. Rules you're following This is where you spell out the specific laws, standards, or policies you’re measuring against like GDPR, HIPAA, SOX, or ISO standards. ### 3\. Findings Now it’s time to detail your findings, which will show where your organization is compliant and where it’s falling short. Remember, it’s better to spot issues early than pretend they don’t exist. ### 4\. Risks What’s at stake if those gaps aren’t addressed? This section lays out the potential impact such as legal trouble, financial loss, or damage to your brand, etc. ### 5\. Next steps Here’s where you show you’ve got a plan. What actions are being taken to fix issues, improve systems, or stay ahead of future risks? ### 6\. Sign-off and approval The final stage usually includes sign-off from a compliance officer or manager. This gives the report authority and confirms that the right people are paying attention. Compliance reports don’t need to be complicated. Remember to keep the language clear, avoid jargon and focus on what matters. The goal is to make it easy for anyone (whether it's a regulator or your own team) to understand. For finance professionals, this is where your attention to detail, your data, and your ability to tell a story with numbers really shines. Compliance in finance means making sure the money side of the business backs up the policies and that starts with accurate, honest compliance reporting. --- [Top finance events to attend 2025 | Finance Alliance2025 is set to be an exciting year with a range of finance events taking place around the world that offer opportunities to learn, network, and grow. Have your calendar ready as we drop the ultimate round-up of top finance events to attend in 2025.👇🏽![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-153.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Summit_Website_Article_Images_OnDemand-1.png)](https://www.financealliance.io/top-finance-events/) --- ## **What is compliance in finance?** When it comes to money, the rules get even tighter, and the stakes go *way* up. In fact, finance and healthcare organizations face the highest risk of cybersecurity attacks. In the past year alone, a striking [58% of financial organizations](https://security.imprivata.com/wp-state-of-cybersecurity-third-party-remote-access-register.html) and 55% of healthcare organizations reported experiencing a data breach through a third party. That’s why compliance in finance isn’t just important... it’s non-negotiable. So, what is compliance in finance, exactly? Well, it’s all about making sure financial institutions like banks, investment firms, fintech startups (or anyone handling money) are following the rules. And we’re not talking about light guidelines here. We're talking about strict legal, regulatory, and ethical standards that are meant to protect clients, markets, and the business. This includes laws like: - **Anti-money laundering (AML) -** to stop dirty money from being cleaned through legit businesses. - **Know your customer (KYC) -** to make sure you’re not working with shady actors. - **Financial reporting standards -** to ensure transparency and accuracy in financial statements. But you can’t forget internal controls in all this. Things like fraud prevention, [risk monitoring](https://www.financealliance.io/ai-in-risk-management-how-banks-can-mitigate-fraud-and-financial-crimes/), and even keeping insider trading in check. That’s where finance teams step in. You’re the ones making sure the numbers add up, the risks are flagged, and the reports are airtight. Now here’s where it gets really interesting: a recent study found that [72% of compliance and risk professionals](https://www.navex.com/en-us/resources/benchmarking-reports/state-risk-compliance/) say their third-party due diligence programs help cut down legal, financial, and reputational risks in a big way. That’s huge because when finance teams are involved in vetting vendors, managing transactions, or flagging suspicious patterns, you’re directly helping protect the company from costly mistakes (and sometimes even lawsuits). --- ## **Compliance tracking and reporting** In finance, compliance tracking and reporting is a critical part of managing risk, protecting the firm’s reputation, and keeping regulators off your back. Tracking keeps things in check behind the scenes while reporting proves you’re doing it right. Do both well, and you’re protecting your company from fines, fraud, and nasty surprises. Here are a few no-nonsense tips to make compliance tracking and reporting a lot smoother: ### Know your data inside and out You can’t keep tabs on what you don’t understand. For that reason, you need to know where your [financial data](https://www.financealliance.io/data-cleaning-techniques/) lives, how it’s being used, and who’s getting their hands on it. The better your visibility, the easier it is to spot problems early. ### Automate the boring stuff If you’re doing things manually, you could risk human error feeding into the process. So, consider using tools that can automate compliance alerts, track policy updates, and log activities in real time. [Finance software](https://www.financealliance.io/15-best-fp-a-tools-and-software/) with built-in compliance features can be a huge help and free up some time that you can use on other things. ### Create a reporting rhythm Don't wait until someone's breathing down your neck for a compliance report to start scrambling. Set up a regular schedule such as monthly, quarterly, or whatever works best for you. That way, nothing gets forgotten, and you'll always be prepared. ### Make your reports readable It’s better to keep things as simple as possible and skip the jargon. Whether your audience is a regulator, an exec, or your own team, your compliance reports should be clear, visual, and easy to understand. To help with this, you could try using summaries, charts, and real language to get your message across. ### Keep a risk-first mindset Compliance is about avoiding risk. Always be asking, “What’s the risk if we don’t catch this?” That kind of thinking will help you focus on what truly matters. Compliance tracking and reporting go hand-in-hand. One without the other is like having receipts you never check. But when they work together, finance teams can prevent big problems, which every company needs. --- [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-154.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts-2.png)](https://www.financealliance.io/financial-charts-and-graphs/) --- ## **How to create a compliance report** So how do you actually create a compliance report *without* losing your mind (or your weekend)? Compliance reporting requires a clear process, clean data, and structure. With the right steps (and mindset), building a solid compliance report becomes just another part of doing business the right way. Here’s how to get started: ### 1\. Know what (and who) you’re reporting to Start with the basics. Before you pull a single number, get clear on a few things: - What are you required to report? - Who needs the report? (Regulators? Internal auditors? The board?) - What format does it need to be in? Don’t wing this. Depending on your industry, you might be dealing with financial reporting rules, tax laws, ESG disclosures, or all of the above. A quick checklist can save you from scrambling later. ****🛠️ Pro tip:** Different reports have different deadlines and details. A centralized compliance calendar can help your team stay on track and stress-free. ### 2\. Pull the right data Next, grab the data you need. [Clean, accurate data](https://www.financealliance.io/using-chatgpt-for-data-cleaning/) is the backbone of all good compliance reports. Focus on pulling: - Financial statements - Transaction and payment data - Risk metrics - Any metrics specific to the regulations you're tracking ****🎯 What to avoid:** Digging through outdated spreadsheets where no one knows which version is the “real” one. If your ERP and finance systems aren’t talking to each other, this step can get messy fast. ### 3\. Check for accuracy and consistency Before you hit “submit,” review your numbers. Actually, double-check everything. Ask yourself: - Do these numbers match across reports? - Do they reconcile with the general ledger? - Would someone outside the team understand what they’re reading? 👀 ****Gut check:** If a regulator walked in tomorrow and asked to see this report, would you feel confident handing it over? This is especially important now because [70% of risk and compliance professionals](https://www.thomsonreuters.com/en-us/posts/investigation-fraud-and-risk/risk-compliance-survey-report-2023/) say their companies are moving away from checkbox compliance and toward more strategic, thoughtful practices. That shift means regulators are paying closer attention to the details. ### 4\. Use templates and automation where you can There’s no need to start from scratch every time. Use templates that match regulatory requirements. Better yet, use compliance software that automates parts of the process like data pulls, calculations, formatting, and even reminders. 💡 ****Try this:** Automate the parts of the process that are rules-based and repeatable. Save your brainpower for reviewing and decision-making. ### 5\. Build a rock-solid audit trail Good compliance reporting isn’t just about what’s in the report, you also need to focus on how you got there. Keep clear records of: - Where the data came from - Who reviewed it - When changes were made - Why decisions were made ### 6\. Submit on time and store everything Sounds obvious, but it’s worth repeating: follow the format, meet the deadline, and submit to the right place. Then, back everything up in a secure and searchable system. This isn’t just about avoiding chaos later. It’s also about building trust. Right now, [60% of executives](https://www.pwc.com/us/en/services/consulting/library/consumer-intelligence-series/consumer-and-employee-esg-expectations.html) say they’re investing more time and resources into compliance, but only 31% of consumers believe companies are doing enough. That gap shows one thing: if you’re doing the work, you need to show it clearly. Transparency is everything. --- ## **FAQs** **Q. What is the meaning of a compliance report?** **A.** A compliance report is a document that shows how a company is following rules, laws, or internal policies. It highlights where things are working and where they need fixing. **Q. What is an example of compliance reporting?** **A.** Filing a report to show your company meets anti-money laundering (AML) regulations or submitting quarterly financial controls under SOX are both examples of compliance reporting. **Q. Who are the recipients of compliance reports?** **A.** The recepients of compliance reports tend to be regulators, auditors, board members, executives, and sometimes clients or investors. Basically, anyone who needs proof that your company is staying compliant. **Q. What are some challenges in compliance reporting?** **A.** Common issues related to compliance reporting include missing or messy data, manual processes, tight deadlines, lack of clarity on regulations, and poor internal communication. **Q. What is financial reporting compliance?** **A.** It means making sure your financial statements follow rules like GAAP or IFRS, and that your reporting practices meet legal and regulatory standards. --- ### Ready to take your compliance game even further? If this guide helped clear the fog around compliance reporting, you’ll love what we share with our Insider Members. [Join our FREE membership](https://www.financealliance.io/insider-membership-plan/) to unlock exclusive articles, on-demand videos from top finance events, expert insights, and real-world strategies from finance pros who’ve been there, done that. [Join now for free](https://www.financealliance.io/insider-membership-plan/) ### Unlocking the FP&A career ladder: Which role is right for you? URL: https://www.financealliance.io/unlocking-the-fp-a-career-ladder-which-role-is-right-for-you/ Last updated: 2025-10-08T09:06:31.000Z If you’ve ever looked at FP&A job titles, Analyst, Senior Analyst, Manager, Director, V.P., and felt confused, you’re not alone. Many finance professionals don’t truly understand the differences until they’re already in their careers. But what if you could decode all of that today? This article breaks down the FP&A career path from entry-level to executive so you can figure out where you are, where you’re headed, and what it takes to get there. ## **The entry-level: Associate / Analyst / Sr Analyst** Let’s start at the beginning: the FP&A Associate or entry-level analyst. This role often becomes a trap for those who see it as just “data work.” Sure, you’re pulling reports and maintaining spreadsheets, but the key to moving up is treating this job like a training ground, not a dead end. Imagine two associates. One focuses on Excel formulas and knocks out tasks fast, but never asks what happens to the reports afterward. The other shows curiosity, joins budgeting meetings, and asks how their work drives business decisions. Guess who gets promoted? Most companies don’t lay out a roadmap. That’s why only a fraction of associates progress quickly. The real differentiator is whether you develop forecasting skills and business understanding early. Ask questions. Notice spending patterns. Understand how marketing changes budgets or how operations shift in response to seasonality. These aren’t just “extra tasks”. They’re your ladder upward. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-150.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FP-A-career-salary-and-path-2-5.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## **Analyst vs. manager: The big leap** Now, suppose you’ve graduated to an analyst role. The next big challenge? Becoming a manager. And it’s not as simple as just being a better analyst. Analysts focus on accuracy: perfect models, detailed reports, clean reconciliations. Managers do something different. They take those numbers and explain what they mean. Why did revenue fall short? What’s the operational fix? They bridge finance with the rest of the business. Let’s look at Rahul, a star analyst who built flawless models. But when promoted, he struggled to lead. He’d present data dumps instead of insights. His team meetings lacked vision. Eventually, he was moved back to an individual role. Why? Because the manager role isn’t about doing more analysis. It’s about making strategic decisions, communicating clearly, and leading others. To prepare, analysts should start asking: “What does this report mean for the business?” and “What decisions should be made next?” Volunteer to present your work. Get comfortable speaking to stakeholders outside finance. You don’t need a new title to act like a manager. ## **The specialist path** Now here’s a truth most people don’t hear: not everyone wants to manage people. And that’s perfectly fine. FP&A offers a parallel path for specialists. Take Priya. She was a Senior Analyst who didn’t enjoy managing a team. Instead, she moved into a [Finance Business Partner](https://www.financealliance.io/finance-business-partnering-playbook-2/) role supporting marketing. She became the go-to expert for ad spend strategy and ROI, helping drive decisions without managing a single person. Specialist roles like Business Partners, FP&A Consultants, or Commercial Analysts let you grow deep in specific areas. Some focus on revenue analytics, others on forecasting or [M&A](https://www.financealliance.io/m-a-best-practices/). These jobs often pay just as much. Sometimes, more than traditional management roles are required because of the niche expertise required. The catch? You need to be intentional. Choose industries and projects that align with your interests. Get certified. Network with others in your niche. Build a reputation as the “go-to” expert. And no, it doesn’t limit your future. Many specialists later shift into operational leadership roles because their business understanding runs deep. --- [Tariff impact: Beyond headlines to the P&L reality for emerging businessesDiscover expert insights into the actual P&L impact and management decisions that go into maneuvering these uncertainties and increased costs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-151.png)Finance AllianceSalvatore Tirabassi![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--63-.png)](https://www.financealliance.io/tariff-impact-beyond-headlines-to-the-p-l-reality-for-emerging-businesses/) --- ## **Director to VP: Strategic influence over technical skill** Reaching Director or VP levels is a game-changer. By now, it’s not about how good you are at Excel. It’s about how well you shape the company’s financial future. Directors focus on running efficient processes: monthly closes, forecast accuracy, and budgeting tools. VPs zoom out. They’re the ones preparing CFOs for earnings calls, advising on [capital allocation](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/), and leading cross-functional initiatives. The key difference is strategic alignment. A Director might implement a new planning system. A VP makes sure that the system aligns with the CEO’s growth goals. One focuses on optimization. The other influences the direction. Want to reach VP? Build business acumen. Practice executive communication. Lead change, not just processes. Get involved in projects that expose you to the C-suite. Focus on shaping performance, not just reporting it. ## **Choose your own adventure** Here’s the big takeaway: there’s no one “right” way to grow in FP&A. You can climb the leadership ladder, go deep as a specialist, or carve a hybrid path. What matters is that you focus on building skills that create business impact, whether it’s variance analysis or stakeholder communication. This quarter, pick one skill to sharpen. If you’re an associate, learn how your reports impact business decisions. If you’re a director, practice turning data into boardroom narratives. Titles may change, but your ability to drive results will always be your most valuable asset. The best FP&A careers aren’t built by waiting for the next promotion. They’re built by solving the next big problem. *\[This article was originally published on the* [*FP&A Professionals Institute blog*](https://fpnaprofessionals.com/unlocking-the-fpa-career-ladder-which-role-is-right-for-you/)*\]* ### The strategic evolution of finance, with Siqi Chen [video] URL: https://www.financealliance.io/podcast/the-strategic-evolution-of-finance-with-siqi-chen-video/ Last updated: 2025-06-24T20:59:08.000Z _No content available._ ### Tariff impact: Beyond headlines to the P&L reality for emerging businesses URL: https://www.financealliance.io/tariff-impact-beyond-headlines-to-the-p-l-reality-for-emerging-businesses/ Last updated: 2025-10-08T09:06:28.000Z The ping-ponging news on tariffs has been very confusing for emerging businesses. The international trade commission has found that while steel and aluminum producers may benefit from tariffs imposed by President Trump, the overall economic repercussions could be detrimental, particularly for downstream industries. In a recent podcast interview, I discussed tariffs and how the fundamental economics of tariff impositions are not covered in the more general media. By this, I mean that the tariffs themselves as headline numbers and the roiling of the stock market supercede a more in-depth discussion of how tariffs affect emerging businesses in their P&L. In this post, I want to provide some insights into the actual P&L impact and management decisions that go into maneuvering these uncertainties and increased costs. ![Tariff impact](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/tariff-image-1.webp) ## Some background facts on the trade war In order to make this a concrete discussion, let’s focus on Chinese import tariffs, and I want to talk a bit first about the kinds of privately-held businesses impacted by the tariffs and the quantum of the economic value in this category of businesses that is impacted by the expense of tariffs. My reasons for focusing on this category is to demonstrate the kitchen-table discussion that these tariffs are currently causing in the homes of these business owners. Privately-held businesses form the backbone of the American economy and are particularly vulnerable to tariff increases. Small and medium-sized enterprises (SMEs) with fewer than 500 employees account for 99.9% of all U.S. businesses and employ 47.1% of the private workforce - approximately 60.6 million Americans. Within this group, businesses involved in importing consumer goods from China are especially exposed to the recent tariffs. The U.S. Census Bureau reports that approximately 263,000 small businesses engage in international trade, with a significant portion conducting business with China. These companies contribute over $500 billion annually to the U.S. economy and support roughly 6 million jobs directly and indirectly. Many operate on relatively thin margins of 10-15%, making them particularly sensitive to cost increases that cannot be easily absorbed. Understanding the specific tariff exposure of these SMEs is crucial, as it directly affects their cost structures and pricing strategies. Identifying materials affected by tariffs and calculating potential cost increases are essential steps for these businesses to maintain profitability amid changing tariff conditions. In the consumer goods sector alone, which includes home furnishings, electronics, apparel, and household items, small and medium-sized importers account for about 40% of the $463 billion in annual imports from China. These businesses typically lack the scale, resources, and negotiating power of their larger counterparts to easily mitigate tariff impacts, making them disproportionately affected by sudden trade policy changes. --- [Why ‘black box’ AI is failing FP&A and what to use insteadIf you’ve ever doubted an AI-generated forecast, this article shows you how to finally understand and trust the numbers.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-147.png)Finance AllianceChristian Martinez![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--58--2-2.png)](https://www.financealliance.io/why-black-box-ai-is-failing-fp-a-and-what-to-use-instead/) --- ## **Quick timeline review** The [rapid evolution of tariff policy has created a challenging environment for business planning](https://cfoproanalytics.com/cfo-blog/f/hot-take-understanding-tariffs-its-impact-and-how-businesses-can-adapt/). On February 1, 2025, the Trump administration announced plans to impose 25% tariffs on imports from Canada and Mexico, and a 10% tariff on goods from China. By February 3-4, following diplomatic negotiations, the administration agreed to a 30-day pause on the Mexico and Canada tariffs, while implementing the 10% tariffs on Chinese imports. During this period, targeted tariffs were used as a strategic measure to escalate trade pressures, particularly affecting industries such as automotive and electronics. On March 12, in a significant escalation, the administration reinstated 25% tariffs on all steel imports and increased tariffs on all aluminum imports to 25%, applying these measures globally without country exemptions. Looking ahead, additional tariffs on Canadian and Mexican imports are expected to take effect on April 2, following the expiration of the temporary reprieve. These have been described as potentially including both sectoral and reciprocal measures, further complicating the planning horizon for businesses. ## Understanding tariffs and their impact Tariffs are taxes imposed by the federal government on imported goods, and they can have a significant impact on businesses and consumers alike. In the current global trade environment, we are witnessing a **“tariffs everywhere, all at once”** scenario, where multiple countries are imposing tariffs simultaneously. This creates a complex and unpredictable trade environment, making it challenging for businesses to adapt. The impact of tariffs extends far beyond the companies that directly import goods. Suppliers, customers, and the broader economy all feel the ripple effects. For businesses, tariffs often lead to rising costs as import taxes increase the price of goods. These increased costs can reduce consumer spending, as higher prices may deter purchases. Additionally, tariffs can disrupt trade flows, leading to delays and inefficiencies in the supply chain. In some cases, tariffs can trigger retaliatory tariffs from other countries, escalating into a full-blown trade war. This tit-for-tat approach can further complicate the trade landscape, creating additional barriers for businesses to navigate. Companies that invest in [strategic financial planning](https://www.financealliance.io/dr-no-to-dr-know/) can better prepare for such economic uncertainties, ensuring they have contingency plans in place. While domestic producers might benefit from reduced competition from foreign imports, they too can face challenges. Higher prices for raw materials and components can squeeze margins, and companies may struggle to find alternative suppliers, leading to potential shortages. Ultimately, companies respond to these increased costs by raising prices, which can lead to decreased demand and lower sales volumes. The broader economic impact includes potential job losses and reduced economic growth, as businesses and consumers alike adjust to the new cost structures imposed by tariffs. ## **A Profit and Loss example** Let’s examine how these tariffs concretely impact both a U.S. retailer and a branded manufacturer using designer lighting as our example. ### **Pre-tariff economics:** ##### *Branded manufacturer:* - Manufacturing cost in China: $85 per unit - Wholesale price to retailer: $150 per unit - Gross margin: $65 (43.3%) ##### *Retailer:* - Wholesale purchase price: $150 per unit - Retail selling price: $299 per unit - Gross margin: $149 (49.8%) ### **Post-33% Tariff (phase 1 – manufacturer absorbs cost):** ##### *Branded manufacturer:* - Manufacturing cost: $85 per unit - Tariff cost (33%): $28.05 per unit - Total landed cost: $113.05 per unit - Wholesale price (unchanged): $150 per unit - Gross margin: $36.95 (24.6%) - Gross margin reduction: 43.2% ##### *Retailer:* - Wholesale purchase price: $150 per unit - Retail selling price: $299 per unit - Gross margin: $149 (49.8%) – Unchanged The branded manufacturer’s margin has collapsed from 43.3% to 24.6%, a reduction that is likely unsustainable for most businesses in this category. This leads us to Phase 2. ### **Post-tariff (Phase 2 – Price increase):** ##### *Branded manufacturer:* - Total landed cost: $113.05 per unit - Target margin restoration: 40% - New wholesale price: $188.42 per unit - Gross margin: $75.37 (40%) ##### *Retailer:* - New wholesale purchase price: $188.42 per unit - Adjusted retail price to maintain \~50% margin: $376.84 - Issue: This breaks the $300 price band, which is a conceptual ceiling that retailers determine is the most a consumer will pay for a product or the level at which they are not going to shop for a different deal. Due to price banding concerns, the retailer and manufacturer might agree to a compromise: - New retail price: $349.99 (keeping below the $350 psychological threshold) - Retailer’s new margin: $161.57 (46.2%) - Slight compression from original 49.8% This represents a 17% increase in the final consumer price, which will inevitably affect demand. --- [The CFO’s crash course in finance and complianceGovernance, risk management and compliance. These aren’t exactly the most exciting aspects of a CFO’s role, but that doesn’t stop them from being vital areas of focus. 🎯![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-148.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_3_compliance-1.jpg)](https://www.financealliance.io/finance-and-compliance/) --- ## Consumer price elasticity: Lower demand for products due to retaliatory tariffs The price elasticity of demand for designer lighting products typically ranges from -1.2 to -1.8, meaning that for every 1% increase in price, demand decreases by 1.2% to 1.8%. With our 17% price increase, we can expect demand to decrease by approximately 20-30%. This price sensitivity is magnified by current consumer financial conditions. U.S. household credit card debt reached a record $1.13 trillion in Q4 2024, with average credit card balances exceeding $6,000 per cardholder. Revolving credit utilization rates are approaching 35%, indicating diminished capacity for discretionary spending. The pressure on consumer spending is further evidenced by the debt-to-income ratio for U.S. households, which has climbed to 102% – meaning households owe more than they earn in a year. This overleveraged position makes discretionary purchases particularly vulnerable to price increases. For our lighting product example, industry data suggests that when consumer lighting products cross certain price thresholds, particularly from sub-$300 to $350+, conversion rates drop by approximately 28%. This means that for every 100 customers who would purchase at the $299 price point, only 72 would purchase at $349.99. ## Impact on the businesses and supply chain Let’s quantify this impact on our example businesses, assuming they previously sold 5,000 units annually: #### **Pre-tariff financial performance:** ##### *Branded manufacturer:* - Annual units: 5,000 - Gross margin per unit: $65 - Total gross margin: $325,000 - Operating expenses (60% of gross margin): $195,000 - Net profit: $130,000 - Effective tax rate: 21% - After-tax profit: $102,700 #### *Retailer:* - Annual units: 5,000 - Gross margin per unit: $149 - Total gross margin: $745,000 - Operating expenses (70% of gross margin): $521,500 - Net profit: $223,500 - After-tax profit: $176,565 ### **Post-tariff financial performance (with 25% unit volume reduction):** ##### *Branded manufacturer:* - Annual units: 3,750 (25% reduction) - Gross margin per unit: $75.37 - Total gross margin: $282,638 (13% decrease) - Operating expenses (unchanged): $195,000 - Net profit: $87,638 (33% decrease) - After-tax profit: $69,234 ##### *Retailer:* - Annual units: 3,750 - Gross margin per unit: $161.57 - Total gross margin: $605,888 (19% decrease) - Operating expenses (unchanged): $521,500 - Net profit: $84,388 (62% decrease) - After-tax profit: $66,666 To maintain their original profit levels, both businesses would need to cut costs significantly: ##### *Branded manufacturer:* - Required cost reduction: $42,362 - If labor represents 40% of operating expenses, this equates to potential layoffs affecting approximately 4-5 employees (based on average annual compensation of $65,000 for workers in this sector). ##### *Retailer:* - Required cost reduction: $139,112 - With retail labor typically representing 65% of operating expenses, this could translate to 10-12 employee positions at risk (based on average retail compensation of $45,000). The combined effect across these two businesses alone could impact 14-17 jobs. Multiplied across thousands of similar operations nationwide, the employment impact becomes substantial. ## Managing supply chain disruptions [Supply chain](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) disruptions are a common consequence of tariffs, as companies scramble to adapt to the new trade environment. These disruptions can lead to delays, increased costs, and reduced efficiency, all of which can significantly impact a business’s bottom line. To manage these disruptions effectively, companies can take several proactive steps: 1. **Diversify suppliers**: Reducing reliance on a single supplier is crucial. By diversifying their supply chain, companies can mitigate the impact of tariffs and reduce the risk of disruptions. Sourcing from multiple suppliers in different regions can provide a buffer against trade policy changes. 2. **Invest in supply chain visibility**: Implementing supply chain visibility tools can help companies better understand their supply chain dynamics and identify potential disruptions early. These tools can provide real-time data and analytics, enabling businesses to make informed decisions and respond swiftly to changes. 3. **Develop contingency plans**: Having a [robust contingency plan](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) is essential. Companies should identify alternative suppliers and routes to ensure continuity of supply. This might involve pre-negotiating contracts with backup suppliers or exploring different logistics options to circumvent trade barriers. 4. **Communicate with suppliers and customers**: [Open communication](https://www.financealliance.io/stakeholder-communication-plan/) with suppliers and customers is vital. Keeping all stakeholders informed about potential impacts of tariffs and supply chain disruptions can help manage expectations and foster collaboration in finding solutions. By taking these steps, companies can better navigate the challenges posed by tariffs and maintain a more resilient supply chain. --- [CFO vs. Controller: What’s the difference?In this article, we’re going to try to clear up the confusion. We’ll look at how CFOs and Controllers contribute to a company’s financial health, what their day-to-day responsibilities look like, and why both roles are crucial for businesses of all sizes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-149.png)Finance AllianceElla Harrison![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/CFO-vs-controller-2-1.png)](https://www.financealliance.io/cfo-vs-controller/) --- ## Navigating new trade policy The current trade policy landscape is rapidly evolving, with multiple countries imposing tariffs and trade barriers. For businesses, staying ahead of these changes is crucial to maintaining competitiveness and minimizing risks. Here are some strategies to navigate this new trade policy environment: 1. **Stay informed**: Keeping abreast of changes in trade policy and tariffs is essential. Companies should monitor government announcements, trade publications, and industry reports to stay updated on the latest developments. This information can help businesses anticipate changes and adjust their strategies accordingly. 2. **Assess the impact**: Understanding the specific impact of tariffs and trade barriers on the business is critical. Companies should conduct thorough assessments to evaluate how changes in trade policy affect their sales, costs, and supply chains. This analysis can inform decision-making and strategic planning. 3. **Develop a trade strategy**: A well-defined trade strategy can help businesses respond effectively to new trade policies. This strategy should identify opportunities and risks, outline steps to mitigate negative impacts, and leverage potential advantages. For example, companies might explore new markets or adjust their product offerings to align with changing trade dynamics. 4. **Engage with government**: Active engagement with government officials can provide businesses with a voice in trade policy discussions. Companies can advocate for their interests, provide input on policy decisions, and seek support for navigating trade barriers. Building relationships with policymakers can also help businesses stay informed about upcoming changes and potential impacts. By understanding tariffs and their impact, managing supply chain disruptions, and navigating new trade policy, companies can better adapt to the changing trade environment and minimize the risks associated with tariffs and trade barriers. Leveraging [business analytics solutions](https://cfoproanalytics.com/why-hire-us/) can further help businesses analyze trade patterns, optimize strategies, and make data-driven decisions. This proactive approach will enable businesses to maintain resilience and competitiveness in an increasingly complex global trade landscape. ## **Strategic recommendations for financial leaders** ![Strategic recommendations for financial leaders](https://i0.wp.com/images.surferseo.art/0e648063-0dc3-4fd6-af1f-58a918286a89.png?ssl=1) Navigating these tariff challenges requires a multifaceted approach: 1. **Diversify supply chains**: Evaluate manufacturing in alternative locations like Vietnam, Malaysia, or Mexico. While relocation costs are significant (typically 20-30% of annual production value), they may prove worthwhile for long-term stability. 2. **Value engineering**: Revisit product design to reduce costs without compromising quality. Often, 5-10% cost savings can be achieved through material substitution or design optimization. 3. **Inventory management**: Implement just-in-time inventory systems to minimize capital tied up in higher-cost inventory. Consider alternate ordering patterns that might qualify for reduced tariff rates. 4. **Financial hedging**: Use forward contracts and other financial instruments to lock in currency exchange rates, potentially mitigating some tariff impacts. 5. **Price strategy refinement**: Rather than across-the-board increases, implement tiered pricing models that maintain entry-level price points while adjusting premium offerings. 6. **Technology investment**: Accelerate automation and efficiency initiatives to offset higher input costs, though this should be balanced against employment considerations. 7. **Scenario planning**: Develop robust financial models for multiple tariff scenarios, including potential retaliatory measures from trading partners. Looking ahead, businesses should prepare for a period of trade policy volatility lasting at least through the next 24 months. Those that adapt most effectively will not only survive but may find competitive advantages as less agile competitors struggle with the new cost structure. The most successful approaches will balance short-term profitability protection with long-term strategic positioning, recognizing that the global trade landscape is undergoing a fundamental realignment that will extend well beyond current tariff actions. --- ## Join our free Insider Membership for exclusive content Access expert insights, community, courses, templates and more to boost your finance skills and career. No catches, no monthly bills – 100% free, forever. ### What's included in an Insider membership? **📑 Templates & frameworks.** Save time with battle-tested and ready-to-use templates. **✍️ Exclusive content.** In-depth thought leadership articles from world-leading companies. **📺 Real-world case studies.** Hours of insights from leaders at Adobe, Salesforce, Burberry, Virgin Galactic, and more. **📚 Ungated reports.** One-click access to industry-leading insights to shape your strategies. [Become a member](https://www.financealliance.io/insider-membership-plan/) ### AI in risk management: How banks can mitigate fraud and financial crimes URL: https://www.financealliance.io/ai-in-risk-management-how-banks-can-mitigate-fraud-and-financial-crimes/ Last updated: 2025-10-01T11:49:39.000Z Considering how the world operates now, uncovering fraud is more difficult than ever. In the [Association of Certified Fraud Examiners (ACFE) 2022 report](https://legacy.acfe.com/report-to-the-nations/2022/), it states that global businesses lose around **5%** in revenue annually of operational fraud and spend a projected guesstimate of **4.7 trillion dollars** over fraud worldwide. The report, which entails data from 2110 fraud cases from 133 countries, has an alarming median loss of 1.78 million dollars for each incident. Asia-Pacific countries were reported to have even greater losses, further proving the existence of financial crime as a global problem. Fraud these days goes beyond the frontiers of falsifying financial statements and simple skimming. Advanced fraud operations are known to use everything from synthetic identity and deepfake technology to elaborate cross-border laundering. In one case I came across, a European financial institution was defrauded of approximately [$35 million](https://www.skillcast.com/blog/biggest-aml-fines-annual-report) by a single employee over the course of a year. Systems did exist that were supposed to catch the fraud, but they relied on “advanced” rules, so the monitoring left a lot to be desired. In the criminal and financial services sectors, it is no longer just a war of balance sheets; it's a full-blown strategic technology war. A criminal adopting AI identity tools, biopic evasion methods, and other adaptive deceitful methods has rendered traditional rule-based systems (which used to be the cornerstone of risk management) far too rigid, slow, and narrow in scope. Most of these legacy systems based on static rules suffer greatly when it comes to login device/change times or IP address mismatching leading to an avalanche of false positives and exhaustive hitting firms’ compliance teams- all while degrading the customer experience. This is where [AI and ML](https://www.financealliance.io/fpa-machine-learning/) come in, not as replacements but as changes for the better. AI/ML models featuring pattern recognition, anomaly detection, unsupervised clustering, and behavioral profiling provide risk evaluation that is real-time monitored, updated dynamically, and scalable to the increasing intricacies of modern financial criminal activities. These technologies don’t just react, they learn, adapt, and together with predictive AI, foresee fraudulent attempts even before their execution, allowing banks to achieve the critical balance of agility, security, and [compliance with laws and regulations](https://www.financealliance.io/finance-and-compliance/). ## Limitations of traditional rule-based systems Historically, banks have relied on rule-based systems to identify fraudulent transactions. These systems operate on predefined rules, such as flagging transactions that exceed a certain amount or originate from high-risk regions. While effective to an extent, these systems have significant limitations: ### Static nature Rule-based systems are inherently rigid. They require [manual updates](https://www.swanintelligence.com/financial-fraud-detection-utilizing-ai/) to adapt to new fraud patterns, making them slow to respond to evolving threats. This rigidity can result in outdated detection mechanisms that fail to catch novel fraud tactics. ### High false positives These systems often flag legitimate transactions as suspicious, leading to unnecessary investigations and customer dissatisfaction. For instance, a legitimate high-value purchase might be declined simply because it exceeds a preset threshold, frustrating customers and potentially leading to loss of business. ### Inefficiency The manual review process associated with rule-based systems is time-consuming and resource-intensive. Analysts must sift through numerous alerts, many of which are false positives, diverting attention from genuine threats. This inefficiency not only increases operational costs but also delays the response to actual fraudulent activities. ### Lack of contextual understanding Rule-based systems lack the ability to understand the context of transactions. They cannot analyze user behavior patterns or adapt to individual customer profiles, making it challenging to distinguish between legitimate and fraudulent activities effectively. As fraudsters employ more sophisticated techniques, these traditional systems struggle to keep pace, necessitating a more dynamic and intelligent approach. AI and ML offer adaptive, real-time analysis capabilities that can learn from new data, identify complex patterns, and significantly reduce false positives, thereby enhancing the overall effectiveness of fraud detection in the banking sector. --- [Fraud detection in 2025: Lessons from a decade in the trenchesLearn more about fraud detection and explore lessons to help companies stay secure in the face of persistent threats.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-144.png)Finance AllianceMaxim Filatov![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--55-.png)](https://www.financealliance.io/fraud-detection-in-2025-lessons-from-a-decade-in-the-trenches/) --- ## The AI advantage in fraud detection AI and ML bring a paradigm shift in fraud detection by learning from data patterns and adapting to new threats in real-time. Unlike rule-based systems, AI models can analyze vast amounts of data to identify anomalies indicative of fraudulent activities. ### Behavioral analysis and anomaly detection AI systems can establish a baseline of normal customer behavior by analyzing historical transaction data. Any deviation from this baseline, such as an unusual transaction time or amount, can trigger an alert. For instance, if a customer typically makes small transactions during the day but suddenly initiates a large transfer at night, the system can flag this as suspicious. ### Clustering and pattern recognition Unsupervised learning techniques, such as clustering algorithms, group similar transactions together. Transactions that don't fit into any cluster are considered anomalies and warrant further investigation. Techniques like the Elbow Method, Silhouette Score, and Gap Statistics help determine the optimal number of clusters, enhancing the model's accuracy. ### Dimensionality reduction for visualization High-dimensional data can be challenging to interpret. Techniques like t-Distributed Stochastic Neighbor Embedding (t-SNE) reduce data dimensions, allowing for visual representation of complex datasets. This aids analysts in understanding the data structure and identifying outliers. ### Autoencoders for feature extraction Autoencoders, a type of neural network, are effective in detecting anomalies by learning compressed representations of data. They can reconstruct input data and highlight discrepancies, making them valuable for identifying fraudulent transactions that deviate from learned patterns. ## Importance of model evaluation While developing these models, evaluation metrics play a crucial role in performance tuning and risk assessment. **Recall (sensitivity):** Measures how many actual fraud cases were correctly identified. ![Recall formula](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/recall.png) Where: - **TP (True positives):** Fraud transactions correctly predicted as fraud. - **FN (False negatives):** Fraud transactions incorrectly predicted as legitimate. **Precision**: Measures the proportion of flagged transactions that were actually fraud. ![Precision formula](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/precision.png) - **F1 score:** Harmonic mean of Precision and Recall. ![F1 Score formula](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/formula.png) In fraud detection, **recall is often more critical than precision**, because failing to catch fraudulent activity can result in massive financial and reputational damage. However, a balance is essential to avoid overwhelming fraud teams with too many false alarms. ## Real-world applications and case studies ### HSBC: Enhancing detection with AI [HSBC has significantly improved its fraud detection](https://www.bestpractice.ai/ai-case-study-best-practice/hsbc%5Freduces%5Ffalse%5Fpositives%5Ffor%5Fmoney%5Flaundering%5Fdetection%5Fby%5F20%25%5Fusing%5Fai%5Fto%5Fautomate%5Fthe%5Fsystem%5Frules) capabilities by integrating AI into its risk management systems. In partnership with Google, HSBC developed the Dynamic Risk Assessment system, which analyzes over 1.35 billion transactions monthly across 40 million customer accounts. This AI-driven approach has led to: - **Increased detection:** [Identifying two to four times](https://www.hsbc.com/news-and-views/views/hsbc-views/harnessing-the-power-of-ai-to-fight-financial-crime) more financial crimes than previous methods. - **Reduced false positives:** Achieving a [60% reduction](https://www.hsbc.com/news-and-views/views/hsbc-views/harnessing-the-power-of-ai-to-fight-financial-crime) in false positive cases, thereby minimizing unnecessary customer interactions and investigations. - **Efficiency gains:** [Reducing the processing time](https://www.hsbc.com/news-and-views/views/hsbc-views/harnessing-the-power-of-ai-to-fight-financial-crime) for analyzing transactions from several weeks to a few. These improvements have not only enhanced HSBC's ability to detect and prevent financial crimes but also streamlined operations and improved customer experience. --- [EBITDA calculator & guide to what it really tells youIn this simple guide, we’ll break it all down: what EBITDA is (and isn’t), how it compares to EBITA, when to use it, and we’ll also include a free EBITDA calculator you can use right away.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-145.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/EBITDA-calculator-1.png)](https://www.financealliance.io/ebitda-calculator-guide/) --- ## JPMorgan chase: Real-time fraud prevention [JPMorgan Chase](https://www.lum.ventures/blog/ais-impact-on-financial-fraud-jp-morgan-case-study) has implemented AI systems capable of real-time fraud detection, analysing customer behaviors such as transaction history, location, and device usage. This proactive approach has resulted in: The AI technology used in fraud prevention at JP Morgan has had a notable impact. The bank has seen a significant decline in fraudulent activities such as account takeovers and card-not-present fraud ever since they equipped themselves with AI powered systems. As a case in point, the bank claimed to have achieved a 20% reduction in false positive cases - instances when genuine transactions are marked as fraud. A smoother journey for customers and faster resolution of genuine fraud cases has become possible as fast-paced customer interaction technology is put into place. ## DBS Bank: Augmenting surveillance with AI DBS Bank has integrated AI and machine learning into its transaction surveillance processes, addressing the high false positive rates associated with traditional systems. The AI model: ### AI-driven compliance and fraud detection DBS Bank has emerged as a leader in integrating AI into its risk management and compliance frameworks. By deploying AI-powered systems, [DBS has achieved significant improvements](https://emerj.com/artificial-intelligence-at-dbs-bank/) in detecting and preventing financial crimes. **Key achievements:** **Real-time transaction monitoring:** DBS's AI system processes over 1.8 million transactions per hour, utilising advanced algorithms and behavioral analysis to detect suspicious patterns. This includes automatic flagging of unusual activities, analysis of cross-border transaction patterns, and real-time risk scoring of transactions. **Reduction in false positives:** The bank's AI-powered compliance systems have achieved a [90% reduction](https://twimbit.com/insights/twimbit-ai-spotlight-dbs) in false positives, significantly decreasing the number of alerts that require manual review. **Improved detection accuracy:** There has been a [60% improvement](https://twimbit.com/insights/twimbit-ai-spotlight-dbs) in detection accuracy, enhancing the bank's ability to identify genuine threats. **Faster investigation times:** Investigation times for suspicious activities have been reduced by 75%, allowing for more efficient responses to potential threats. **Enhanced regulatory reporting:** The AI systems have improved the accuracy of regulatory reporting, ensuring compliance with financial regulations. These advancements underscore DBS Bank's commitment to leveraging [AI for robust risk management](https://www.prnewswire.com/news-releases/harvard-business-school-examines-dbs-ai-strategy-and-implementation-in-its-first-case-study-focusing-on-ai-in-an-asian-bank-302248738.html) and compliance, setting a benchmark in the banking industry. --- [The rise of banking as a service: Transforming the financial landscapeA new paradigm is emerging that is poised to revolutionize the way we think about banking. Banking as a Service (BaaS) is a cutting-edge concept that is reshaping the financial ecosystem, offering a glimpse into the future of banking.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-146.png)Finance AllianceBrendan Byrne![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--59--2.png)](https://www.financealliance.io/the-rise-of-banking-as-a-service-transforming-the-financial-landscape/) --- ## Best practices for AI use in banking risk management Successfully integrating AI into risk management requires a delicate balance between fostering creativity while strictly adhering to regulations. 1. **Hybrid model deployment** It is suggested that all banks institute AI models concurrently with traditional rule-based systems. Using this approach allows comparative assessment which gives institutions evidence concerning the efficacy of AI models as they transition. 2. **Continuous model training** Fighting evolving techniques of fraud requires AI models to be regularly updated with new data. New patterns and anomalies will continuously learn and will enable the models to adjust. 3. **Robust evaluation metrics** Recall, precision, and average F1 score are among the adequate measures for evaluating model performance. They assist in refining the models so that the hospitals can achieve the set target of maximum detection and minimum false positives. 4. **Explainability and transparency** The implementations of Explanatory Artificial intelligence (XAI) enable all stakeholders to track the processes employed in arriving at specific decisions made. This is critical for the compliance with regulations and trust from stakeholders. 5. **Responsible governance of artificial intelligence** It is necessary to set policies and frameworks around ethics. This encompasses protecting data privacy, mitigating prejudice, and ensuring the values and regulations of the AI-implementing entity are respected. ## **Final thoughts** Adoption and use of AI technology in banking risk management is a remarkable step in fighting fraud and financial crimes. The impact of AI on detection accuracy, operational effectiveness, and compliance is astonishing at HSBC, JPMorgan Chase, and even DBS Bank. Discovering still more innovative ways to finance all kinds of crimes warrants employing artificial intelligence solutions, which is no longer merely beneficial. Banks can manage risks better, defend their clients, and maintain the integrity of the financial system when they start using AI. --- ## Join our free Insider Membership for exclusive content Access expert insights, community, courses, templates and more to boost your finance skills and career. No catches, no monthly bills – 100% free, forever. ### What's included in an Insider membership? **📑 Templates & frameworks.** Save time with battle-tested and ready-to-use templates. **✍️ Exclusive content.** In-depth thought leadership articles from world-leading companies. **📺 Real-world case studies.** Hours of insights from leaders at Adobe, Salesforce, Burberry, Virgin Galactic, and more. **📚 Ungated reports.** One-click access to industry-leading insights to shape your strategies. [Become a member](https://www.financealliance.io/insider-membership-plan/) ### Beyond automation: Why human skills are the future of finance URL: https://www.financealliance.io/beyond-automation-why-human-skills-are-the-future-of-finance/ Last updated: 2025-06-24T06:20:41.000Z *\[This article is based on a presentation given by Dani Martins, Strategic Business Partner & Founder of DM Brasil Soluções Estratégicas (and formerly VP Head of FP&A, Thoughtworks), at our FP&A Summit, London in 2024\. Catch up on this presentation, and others, using our* [*OnDemand service*](https://www.financealliance.io/ondemand/)*. And for more* [*exclusive content*](https://www.financealliance.io/tag/members-only-articles/)*, check out your* [*membership dashboard*](https://www.financealliance.io/pro-plus-membership-dashboard/)*.\]* Everywhere you turn, AI is making headlines. It's in our emails, our meetings, our forecasts, and even our to-do lists. In finance, we’ve been promised that automation will streamline our work, reduce errors, and free us up for more strategic thinking. That’s exciting… until you realize no one’s exactly sure what “more strategic thinking” actually means in practice. According to the World Economic Forum, 23% of jobs will change in just the next few years. That’s not a futuristic forecast, it’s already happening. Some jobs will go. Some new ones will be created. And that leaves a big question for all of us: *If machines are doing more and more of the work...what do we do?* My answer? We lean into what machines can’t do - our human skills. Not just soft skills as a buzzword. I mean real, essential capabilities: empathy, adaptability, critical thinking, and leadership. These aren’t “nice-to-haves” anymore. They’re the core of what will set us apart in an AI-powered world. In this blog, I’ll share what I’ve learned from my own journey, from traditional finance leadership to a more human-centered approach, and how we can all adapt, lead, and thrive in this next chapter of work. ![AI in finance ](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/Screenshot-2025-06-12-at-13.23.44.png) ## **What *can’t* machines do?** That’s the real question, isn’t it? If AI can automate data entry, reconciliation, and even elements of forecasting, what’s left for us? Well, I started looking deeper. I found a Gartner report that focused on AI adoption across Europe, and the data was eye-opening: AI usage in finance functions has jumped by 58% in just one year. That’s not a gradual shift. That’s a tidal wave. ![Gartner survey results](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/Screenshot-2025-06-12-at-13.25.47.png) And look, I get the skepticism. Many of us still rely on Excel as our daily tool. Most organizations don’t have a single source of truth. Collaboration tools are limited. It doesn’t always feel like we’re living in the AI age just yet. But we are. It’s coming whether we’re ready or not. To be fair, I was skeptical too…until I saw this data. Companies really are using AI. Not everywhere, and not always in flashy ways, but it’s happening. And where is it showing up the most? In operational finance: accounts payable, accounts receivable, and invoice processing. The kind of work that’s rule-based and repetitive. As leaders, that raises some important questions: > *What happens to the people doing those jobs?* > *How do we help them evolve with the work?* It’s our responsibility to create new paths for our teams and to help them develop the skills they’ll need to stay relevant, valued, and engaged. ## **Challenges in integrating AI** Some of the biggest hurdles we’re facing with AI in finance aren’t technical, they’re human. Let’s start with talent. We need people who understand AI and can actually implement it within a finance context. That often means hiring data scientists. But here’s the tricky part: these data scientists also need to understand accounting. They need to know how to connect the dots across the three financial statements. That’s not easy to find. So, we’re left with two options, and both are tough: 1. Attracting that rare, hybrid talent from the outside. 2. [Upskilling the people](https://www.financealliance.io/finance-talent/) already on our teams. And honestly, I’m much more interested in the second one. If we’re serious about transformation, we have to make it *human*. That means involving people early, building their confidence, and giving them a role in the future we’re creating, not just expecting them to keep up. --- [EBITDA calculator & guide to what it really tells youIn this simple guide, we’ll break it all down: what EBITDA is (and isn’t), how it compares to EBITA, when to use it, and we’ll also include a free EBITDA calculator you can use right away.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-141.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/EBITDA-calculator.png)](https://www.financealliance.io/ebitda-calculator-guide/) --- ## **Navigating unknowns in finance** At the same time that automation is increasing, we’re also dealing with a lot of uncertainty. Even as we implement AI, there’s still very little clarity on which new skills will be needed long-term. We don’t know, and that’s okay. What matters is creating some kind of path forward for ourselves, for our teams, and for the people who trust us to lead them. That’s why I prefer the term human skills over “soft skills.” It helps us anchor into something real and practical. These are the capabilities we can lean on and develop while the rest of the world keeps shifting. According to Gartner, AI is currently impacting three main areas in finance: - Reporting (no surprise there) - [Predictive analysis](https://www.financealliance.io/the-finance-forum-how-machine-learning-can-help-create-predictive-models/) - Decision-making support Now, while reporting is an obvious use case, predictive analysis is still rare. I’ve only heard of one finance team doing it successfully shared during an AFP conference in the U.S. But that company was already dabbling in blockchain and big data years ago. They were ahead of the curve. Most companies? Still catching up. And let’s face it - finance is historically underfunded when it comes to tech investment. So, the question is: how fast will this change really happen? Honestly, I don’t know. And that’s a recurring theme in this conversation. I have more questions than answers. But that’s okay. The goal isn’t to have it all figured out, it’s to keep asking the right questions and moving forward with intention. ## **AI's role in decision making** ![AI's role in transforming finance](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/Screenshot-2025-06-12-at-13.25.57.png) Another big area where AI is making waves is decision-making. Now, I want to pause here and bring in two key reflections that came from a Gartner webinar I watched recently. First, yes, AI absolutely processes large volumes of data far better than we can. Thank goodness for that. It can handle far more than Excel, Power Query, or whatever tool we’re using today. And let’s be honest, none of us are dreaming about spending more hours buried in spreadsheets. So, this is a good thing. But here’s the catch: AI isn’t actually intelligent. It’s [artificial intelligence](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/), but it’s not thinking or feeling. It’s trained by humans, and it can only spot patterns we’ve already taught it to recognize. So, everything AI gives us is based on the past. It’s great at repetition. But what about the unexpected? *What if another pandemic hits?* *What if a new president shifts the global economy overnight?* These aren’t hypothetical questions. AI doesn’t know what to do in a brand-new scenario. It can’t anticipate what it hasn’t already seen. So yes, AI will give us more operational efficiency, but it can’t replace the human ability to interpret, to question, to lead. That’s why we still matter and why the future is still human. - The creativity to see beyond the data. - The empathy to understand people and context. - The leadership to act when there’s no playbook. These are the things AI can’t do and these are the skills that will make you (and your business) stand out in an increasingly automated world. _This post is for paying subscribers only._ ### EBITDA calculator & guide to what it really tells you URL: https://www.financealliance.io/ebitda-calculator-guide/ Last updated: 2026-03-05T09:50:14.000Z Have you ever looked at a company’s profit and loss statement and thought, “Okay, but how much are we actually making?” *That’s* where EBITDA comes in (short for earnings before interest, taxes, depreciation, and amortization). It’s one of the clearest ways to cut through the noise and figure out how a business is *really* performing. While EBITDA isn’t perfect (and we’ll go over why soon), it’s still very practical. It strips away things that can cloud your judgment like financing choices, tax strategies, and accounting quirks, so you can zero in on actual operating performance. In this simple guide, we’ll break it all down: what EBITDA is (and isn’t), how it compares to EBITA, when to use it, and we'll also include a free EBITDA calculator you can use right away. No fluff, no filler - just straight talk on how this metric can help you make smarter financial decisions. Sound good? Let’s get into it… --- **This guide covers:** - [Definition of EBITDA](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Eebitda-definition%3C/strong%3E) - [What is EBITDA?](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Ewhat-is-ebitda?%3C/strong%3E) - [Why use it?](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Ewhy-use-ebitda?%3C/strong%3E) - [EBITDA vs. EBITA: Differences explained](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Eebitda-vs.-ebita:-differences-explained%3C/strong%3E) - [EBITDA formula](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Ehow-to-calculate-ebitda%3C/strong%3E) - [EBITDA calculator](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Eebitda-calculator%3C/strong%3E) - [What you can learn from EBITDA](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Ewhat-you-can-learn-from-ebitda-%3C/strong%3E) - [The limitations ](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Ethe-limitations-of-ebitda-%3C/strong%3E) - [Operating Profit vs. EBITDA](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Eoperating-profit-vs.-ebitda%3C/strong%3E) - [Gross Profit vs. EBITDA](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Egross-profit-vs.-ebitda%3C/strong%3E) - [EBITDA vs. Operating Income](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Eebitda-vs.-operating-income%3C/strong%3E) - [Operating Earnings vs. EBITDA](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Eoperating-earnings-vs.-ebitda%3C/strong%3E) - [Net Income vs. EBITDA](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#%3Cstrong%3Enet-income-vs.-ebitda%3C/strong%3E) - [FAQs](https://www.financealliance.io/p/1cc06a07-dd1b-45a0-b17f-36828879dde6/?member%5Fstatus=free#faqs) --- ## **EBITDA definition** ****EBITDA** stands for ‘****Earnings Before Interest, Taxes, Depreciation, and Amortization**’. It measures a company's ****core operating performance**. It strips away financing, tax, and non-cash accounting impacts to offer a clearer view of profitability and cash flow potential, making it useful for industry comparisons. ## **What is EBITDA?** EBITDA tells you how much money a company makes from its core operations before all the financial and accounting extras come into play. Think of it like this: you're running a business. You're making sales, paying employees, keeping the lights on, those things make up your day-to-day. EBITDA focuses on just *that* part. It ignores how you financed the business (interest), what country you're in (taxes), or how your accountants handle your equipment (depreciation and amortization). ## **Why use EBITDA?** EBITDA gives you a clean, high-level look at operational performance with no distractions. It’s especially handy when you’re: - Comparing companies across industries or countries. - [Evaluating a business](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/) without messy accounting tricks. - Trying to figure out what the business might be worth. Here’s a quick example to help understand how EBITDA works. Let’s say a company has: - $2 million in revenue - $500K in operating costs - $100K in interest payments - $200K in taxes - $150K in depreciation and amortization EBITDA is just revenue minus operating costs = **$1.5 million**. It skips the rest because it focuses on how well the core business runs. Bottom line: ****EBITDA is your shortcut to understanding operational profitability.** [How to optimize capital deployed for sustainable growthTo truly drive growth, you need to master the art of strategic capital deployment. Our guide will help you to optimize the capital deployed and help transform your financial strategy into a powerful catalyst for real business growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-138.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Stock--2-.png)](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/) ## **EBITDA vs. EBITA: Differences explained** Okay, so now you know what EBITDA is, but what about **EBITA**? Yes, it’s one letter shorter, but that letter (the “D”) actually matters. First, what does EBITA stand for? EBITA means Earnings Before Interest, Taxes, and Amortization. Sound familiar? That’s because it’s *almost* the same as EBITDA, but with one key difference: EBITA *includes* depreciation. Here’s a quick visual to make it clearer: > **EBITDA** \= Earnings before interest, taxes, depreciation, and amortization > **EBITA** \= Earnings before interest, taxes, and amortization (depreciation is already deducted) While EBITDA shows earnings before *all* major non-cash expenses, EBITA includes depreciation. This means EBITA offers a slightly more realistic view of profitability by accounting for the wear and tear on physical assets. ### **Why does that matter?** The distinction between **depreciation** and **amortization** is crucial because they relate to different types of assets. Depreciation applies to **physical assets** like machinery, buildings, or vehicles, reflecting their wear and tear. Amortization, on the other hand, typically applies to **intangible assets** such as patents or goodwill. Depending on the kind of company you’re looking at: - **EBITDA** might be more useful for asset-heavy businesses (like manufacturing), where depreciation could skew performance. - **EBITA** might be better if depreciation is a meaningful cost that shouldn't be ignored - say, for companies with lots of physical infrastructure. ![EBITDA vs EBITA vs Operating Income](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/EBITDA-vs-EBITA-vs-operating-income.png) ## **How to calculate EBITDA** EBITDA is super easy to calculate once you know what to look for. Here’s the basic formula: > **EBITDA = Net Income + Interest + Taxes + Depreciation + Amortization** Not into net income? You can also go this route: > **EBITDA = Operating Profit (or EBIT) + Depreciation + Amortization** Same idea, just starting a bit higher up the income statement. ## **EBITDA calculator** Use the EBITDA calculator below to estimate your company’s earnings before interest, taxes, depreciation, and amortization. Just enter your figures, and the calculation will be done automatically. It’s a simple way to get a quick view of operational profitability. ### EBITDA Calculator Net Income: Interest: Taxes: Depreciation: Amortization: Calculate EBITDA ## How to use the EBITDA calculator 1. **Enter your Net Income** – This is your company’s total profit after all expenses. 2. **Add interest** – Input any interest expenses the business paid. 3. **Add taxes** – Enter the total tax amount paid. 4. **Add depreciation** – Include non-cash expenses related to asset wear and tear. 5. **Add amortization** – Input any amortization of intangible assets. 6. **Click "Calculate EBITDA"** – The EBITDA calculator will instantly display your EBITDA. That’s it - no spreadsheet required! --- [Top 15 must-have Chief Financial Officer skillsThe modern CFO wears many hats and must master a variety of CFO skills. But what skills does the CFO of the future need to stay on top of their game? Keep reading as we uncover some of the most important Chief Financial Officer skills…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-139.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_6_complete_competence-2.jpg)](https://www.financealliance.io/top-10-cfo-skills/) --- ## **What you can learn from EBITDA** ![What to use EBITDA for](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/Use-EBITA-for.....png) So you’ve got your EBITDA number. Great. Now what? EBITDA is more than just a fancy acronym, it’s a shortcut to understanding how healthy your business is at its core. Let’s break down what it actually *tells* you. ### **1\. How well the business runs, stripped to the basics** EBITDA zooms in on operational performance. It shows you how much money the company is making from just running its business before interest payments, tax bills, or non-cash accounting stuff mess up the picture. ### **2\. How much cash your business might generate** EBITDA is *not* cash flow, but it gets you in the ballpark. Since it adds back depreciation and amortization (which are non-cash expenses), EBITDA can give you a rough sense of how much money the business is generating before it starts writing checks to the government or the bank. ### **3\. How your business stacks up to others** EBITDA helps you understand how your business compares to other companies or competitors. Because it removes interest and taxes, you can easily compare apples to apples, even if one business is in the U.S. and the other’s in Germany. ### **4\. A starting point for valuation** Investors love EBITDA because it’s a go-to [metric for valuing a business](https://www.financealliance.io/infographic-financial-performance-metrics/). Many use EBITDA multiples (like 6x EBITDA, 8x EBITDA) to estimate what a company might be worth. So if you’re gearing up for a sale, [acquisition](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/), or pitch, knowing your EBITDA is like knowing your weight before stepping on the scale. ![What EBITDA tells you vs what it doesn't](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/EBITDA-tells-you-vs-what-it-doesn-t.png) ## **The limitations of EBITDA** EBITDA can be super useful, but it’s definitely not perfect. So, before you start treating it like the one number to rule them all, let’s talk about what EBITDA leaves out, and where it can lead you astray. ### **1\. It’s not real cash flow** As we mentioned, EBITDA is not the same as [cash flow](https://www.financealliance.io/how-to-conquer-the-most-common-cash-flow-challenges-during-economic-downturn/). Yes, it feels like cash flow because it adds back non-cash expenses like depreciation and amortization. But it ignores actual cash going out the door like [capital](https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/) expenditures, loan repayments, and changes in working capital. ### **2\. It ignores debt and interest** EBITDA acts like debt doesn’t exist. That’s fine for comparing companies, but if you’re evaluating your own business? You can’t just pretend loan payments don’t matter. ### **3\. It skips taxes** Sure, ignoring taxes helps when comparing companies globally. But taxes are real. You can't pay employees with pre-tax profit. If you're trying to understand how much money you'll actually keep at the end of the day, EBITDA won’t get you there. ### **4\. It hides capital intensity** Some businesses need to constantly invest in equipment, tech, or upgrades just to keep going. EBITDA says, “No worries, depreciation is non-cash!” But here’s the catch: those assets eventually need replacing, and that costs real money. So a capital-heavy business with high EBITDA might not have much left to reinvest or grow. ### **5\. It can be easily manipulated** EBITDA can often make things look better than they are. Some companies use it to smooth over poor performance or distract from weak cash flow. Ever seen “Adjusted EBITDA”? Be careful. That’s often code for: *We added back a bunch of stuff to make ourselves look more profitable.* --- [Top finance events to attend 2025 | Finance Alliance2025 is set to be an exciting year with a range of finance events taking place around the world that offer opportunities to learn, network, and grow. Have your calendar ready as we drop the ultimate round-up of top finance events to attend in 2025.👇🏽![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-140.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Summit_Website_Article_Images_OnDemand.png)](https://www.financealliance.io/top-finance-events/) --- ## **Operating Profit vs. EBITDA** Operating profit (also called EBIT, or earnings before interest and taxes) and EBITDA are pretty similar, but there’s one key difference: EBITDA adds back depreciation and amortization, while operating profit doesn’t. That means EBITDA gives a slightly more “inflated” picture of earnings, especially for companies with a lot of fixed assets. Operating profit, on the other hand, reflects more real-world costs tied to using up equipment or intangible assets. ## **Gross Profit vs. EBITDA** Gross profit is all about what’s left after subtracting the cost of goods sold (COGS). It shows how efficient your production or service delivery is. EBITDA goes several steps further by accounting for all operating expenses except interest, taxes, depreciation, and amortization. So while gross profit looks at just the direct costs of making your product, EBITDA gives a broader view of profitability from core business operations. ## **EBITDA vs. Operating Income** This one’s easy to mix up. Operating income is your profit after all operating expenses (including depreciation and amortization) but before interest and taxes. EBITDA is just a version of operating income with depreciation and amortization added back in. EBITDA will always be equal to or higher than operating income. Think of it like this: operating income shows profits after wearing down your assets; EBITDA ignores that wear-and-tear and just focuses on the engine of your business. ## **Operating Earnings vs. EBITDA** These terms sound interchangeable, and sometimes they are. Operating earnings is just another name for operating profit or EBIT, depending on who's talking. But here’s the distinction: EBITDA takes it one step further by removing depreciation and amortization, making it less conservative than operating earnings. While both tell you how the business is doing before debt and taxes come into play, EBITDA can make things look rosier, especially for capital-heavy companies where depreciation is a big number. ## **Net Income vs. EBITDA** Net income is your bottom line: everything accounted for, including taxes, interest, depreciation, amortization, and even one-time charges. EBITDA, on the other hand, strips away all that to focus on operational performance. Net income shows what you actually earned at the end of the day. EBITDA shows what you could have earned if those other factors didn’t exist. It’s great for analysis and comparisons, but if you want to know how much money is actually in the bank, stick with net income. --- ## FAQs Is EBITDA the same as gross profit? No. Gross profit is just revenue minus the cost of goods sold (COGS) — basically, how much you make from selling your product or service. EBITDA goes much further, factoring in all operating costs except interest, taxes, depreciation, and amortization. Gross profit shows production efficiency. EBITDA shows overall operating performance. Is EBITDA the same as operating income? EBITDA isn't quite the same as operating income. Operating income (aka EBIT) includes depreciation and amortization. EBITDA adds those back, giving you a higher number. So EBITDA is more of a “clean” version of operating income that strips out non-cash expenses. Why is EBITDA flawed? EBITDA is flawed because it leaves out some pretty important things like capital expenses, debt payments, taxes, and changes in working capital. It can make a business look more profitable than it actually is, especially if you're ignoring how much cash is actually going out the door. What does EBITDA actually tell you? EBITDA tells you how much profit your business is generating from its core operations, before taxes, interest, and non-cash accounting items mess with the picture. It’s a way to see whether the engine of your business is running well. Why use EBITDA instead of net income? Net income is great, but it includes everything such as interest, taxes, depreciation, and one-time items. EBITDA cuts out that noise, which makes it easier to compare companies or focus purely on operational performance. It’s not better, just more focused. Is EBITDA just revenue? Definitely not. EBITDA is what’s left after subtracting operating expenses (but before subtracting interest, taxes, depreciation, and amortization). Revenue is the top line — EBITDA is a more refined look at profitability. Which industry has the highest EBITDA? Generally, industries with low capital costs and high margins — like software, pharmaceuticals, and financial services — tend to show high EBITDA margins. But it varies a lot, so comparisons only make sense within the same industry. What is considered a good EBITDA? It depends on your industry, but a 15–20% EBITDA margin (EBITDA ÷ revenue) is generally solid. For high-growth or low-overhead businesses, margins can go even higher. Just remember: “good” always depends on context. --- ### **Want to level up your finance career?** Join the [**Finance Alliance Insider Membership**](https://www.financealliance.io/insider-membership-plan/?%5Fgl=1%2Azmqkrk%2A%5Fup%2AMQ..%2A%5Fga%2AODMxNTU0NjI1LjE3NDk0NjI4OTA.%2A%5Fga%5F2NXFSBEP4N%2AczE3NDk0NjI4OTAkbzEkZzAkdDE3NDk0NjI4OTAkajYwJGwwJGgw) (it's free) and get access to exclusive content, expert-led sessions, private community channels, and actionable resources designed for high-performing finance professionals. If you found this guide useful, becoming an Insider unlocks even more tools to help you stay sharp, stay ahead, and stay connected. [Start your Insider journey today](https://www.financealliance.io/insider-membership-plan/) ### The rise of banking as a service: Transforming the financial landscape URL: https://www.financealliance.io/the-rise-of-banking-as-a-service-transforming-the-financial-landscape/ Last updated: 2025-10-08T09:08:04.000Z A new paradigm is emerging that is poised to revolutionize the way we think about banking. Banking as a Service (BaaS) is a cutting-edge concept that is reshaping the financial ecosystem, offering a glimpse into the future of banking. At its core, BaaS is the integration of banking services and infrastructure into the offerings of non-financial companies, enabling them to provide financial products and services to their customers. This model allows businesses, from e-commerce platforms to fintech startups, to leverage the expertise and capabilities of banks without the need to build and maintain their own banking infrastructure. The rise of BaaS can be attributed to several key factors. First and foremost, the increasing demand for seamless, personalized financial experiences has driven businesses to seek innovative ways to meet their customers' needs. According to a report by Grand View Research, the global BaaS market is expected to grow at a CAGR of [23.5% from 2022 to 2030](https://www.grandviewresearch.com/industry-analysis/banking-as-a-service-baas-market), highlighting the significant potential of this emerging trend. Moreover, the rapid advancements in financial technology (fintech) have paved the way for BaaS, enabling the integration of banking services into a wide range of digital platforms. As [McKinsey & Company](https://www.mckinsey.com/industries/financial-services/our-insights/the-future-of-banking-is-open) notes: > *"The combination of APIs, cloud computing, and microservices has made it easier for banks to expose their services to third parties, creating a vibrant ecosystem of partnerships."* One of the most compelling aspects of BaaS is its ability to foster innovation and drive financial inclusion. By leveraging the expertise and infrastructure of banks, non-financial companies can offer tailored financial products and services to their customers, catering to the diverse needs of underserved or overlooked market segments. A report by the [World Bank](https://www.worldbank.org/en/topic/financialinclusion/publication/banking-as-a-service-baas-a-new-approach-to-financial-inclusion) highlights the potential of BaaS to "*unlock new business models and drive financial inclusion.*" Furthermore, BaaS presents significant benefits for traditional banks as well. By opening up their services to third-party providers, banks can expand their reach, diversify their revenue streams, and tap into new customer segments. \[According to a study by [Deloitte](https://www2.deloitte.com/us/en/pages/financial-services/articles/banking-as-a-service.html), banks that embrace BaaS can expect to see a 10-15% increase in their overall revenue. However, the rise of BaaS also brings forth new challenges and considerations. Issues around data privacy, regulatory compliance, and risk management must be carefully navigated to ensure the security and integrity of the financial ecosystem. \[The [Bank for International Settlements](https://www.bis.org/publ/qtrpdf/r%5Fqt2003h.htm) emphasizes the importance of robust governance and risk management frameworks in the BaaS landscape\] To overcome these challenges, financial institutions and non-financial companies engaged in BaaS partnerships must establish comprehensive compliance and governance frameworks. This includes adhering to regulatory requirements, implementing robust risk management strategies, developing clear governance structures, ensuring data security and privacy, and fostering close collaboration among all stakeholders. --- [Why ‘black box’ AI is failing FP&A and what to use insteadIf you’ve ever doubted an AI-generated forecast, this article shows you how to finally understand and trust the numbers.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-136.png)Finance AllianceChristian Martinez![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--58--2.png)](https://www.financealliance.io/why-black-box-ai-is-failing-fp-a-and-what-to-use-instead/) --- ## **What's next for banking as a service?** As the financial industry continues to evolve, the future of BaaS holds immense potential. Industry experts and thought leaders envision several exciting developments on the horizon: ### 1\. **Embedded finance** The integration of banking services will become even more seamless, with financial capabilities being embedded directly into the digital experiences of various industries, from e-commerce and transportation to healthcare and education. ### 2\. **Decentralized BaaS** The rise of blockchain and [decentralized finance](https://www.financealliance.io/decentralized-finance-disrupting-traditional-finance/) (DeFi) will enable the development of decentralized BaaS solutions, offering greater transparency, security, and accessibility to a broader range of users. ### 3\. **Hyper-personalization** Advancements in [data analytics](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) and artificial intelligence will empower BaaS providers to offer highly personalized financial products and services, tailored to the unique needs and preferences of individual customers. ### 4\. **Regulatory sandboxes** Regulatory bodies are expected to create more collaborative "sandboxes" to facilitate the safe and responsible development of innovative BaaS solutions, fostering greater innovation while maintaining appropriate oversight. ### 5\. **Ecosystem expansion** The BaaS landscape will continue to evolve, with the emergence of new partnerships, collaborations, and integrations between financial institutions, technology companies, and non-financial businesses, creating a more diverse and interconnected financial ecosystem. As the financial industry continues to evolve, the adoption of BaaS is poised to reshape the banking landscape, driving innovation, enhancing financial inclusion, and unlocking new opportunities for businesses and consumers alike. ## **How can banks become market leaders in banking as a service?** To emerge as market leaders in the BaaS space, banks must proactively embrace and navigate the evolving landscape. Here are some key strategies they can implement: 1. **Invest in innovative technology**: Banks should invest in cutting-edge technologies, such as APIs, cloud computing, and advanced data analytics, to enhance their BaaS capabilities and seamlessly integrate with third-party platforms. 2. **Develop a robust partner ecosystem**: Banks should actively cultivate a diverse ecosystem of partners, including fintech companies, e-commerce platforms, and other non-financial businesses, to expand their reach and offer innovative BaaS solutions. 3. **Foster a culture of innovation**: Banks should foster a culture of innovation within their organizations, encouraging employees to think creatively about BaaS opportunities and empowering them to develop and test new ideas. 4. **Prioritize compliance and governance**: Banks must prioritize [compliance and governance](https://www.financealliance.io/finance-and-compliance/) as a competitive advantage, demonstrating their ability to navigate the regulatory landscape and manage risk effectively, which can help them attract and retain BaaS partners. 5. **Offer customizable and scalable solutions**: Banks should develop BaaS offerings that are highly customizable and scalable, allowing their partners to tailor the solutions to their specific needs and easily scale as their businesses grow. 6. **Leverage data and analytics**: Banks should leverage their vast troves of data and advanced analytics capabilities to offer their BaaS partners valuable insights and personalized financial services that can help them better serve their customers. 7. **Continuously innovate and adapt**: Banks should remain agile and continuously adapt their BaaS strategies to keep pace with the rapidly evolving financial landscape, anticipating and addressing the changing needs of their partners and their end-users. --- [Top 15 must-have Chief Financial Officer skillsThe modern CFO wears many hats and must master a variety of CFO skills. But what skills does the CFO of the future need to stay on top of their game? Keep reading as we uncover some of the most important Chief Financial Officer skills…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-137.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_6_complete_competence-1.jpg)](https://www.financealliance.io/top-10-cfo-skills/) --- ## **Major challenges ahead** As banks and non-financial companies navigate the BaaS landscape, they will face several significant challenges: ### **Regulatory complexity** The financial services industry is subject to a complex and ever-changing regulatory environment, which can create compliance hurdles for BaaS providers. Navigating this landscape and ensuring adherence to regulations across multiple jurisdictions will be a critical challenge. ### **Cybersecurity and data privacy** The integration of banking services into digital platforms heightens the risk of cyberattacks and data breaches. BaaS providers must implement robust cybersecurity measures and data privacy protocols to protect customer information and maintain trust. ### **Legacy systems integration** Many traditional banks operate on legacy IT infrastructure, which can hinder their ability to seamlessly integrate with the modern, API-driven BaaS ecosystem. Modernizing these systems will be a significant undertaking. ### **Talent acquisition and retention** The successful implementation of BaaS strategies requires specialized skills in areas such as [fintech](https://www.financealliance.io/ai-revolution-in-fintech-unleashing-transformative-innovation-2/), data analytics, and cloud computing. Attracting and retaining talent with these in-demand capabilities will be a challenge for both banks and non-financial companies. ### **Ecosystem collaboration** Fostering effective collaboration and coordination within the BaaS ecosystem, which involves banks, fintech firms, and non-financial businesses, will be crucial for driving innovation and addressing the needs of end-users. ### **Balancing innovation and stability** Banks must strike a delicate balance between embracing innovation and maintaining the stability and reliability that customers expect from financial institutions. Failure to do so could erode trust and undermine the adoption of BaaS solutions. ## **Overcoming the challenges** As banks and non-financial companies navigate the BaaS landscape, they will face several significant challenges. Here are some ideas and actions to overcome these challenges: ### **Regulatory complexity** Establish dedicated regulatory compliance teams to monitor and interpret evolving regulations across multiple jurisdictions. Collaborate with industry associations and regulatory bodies to advocate for clear, harmonized regulatory frameworks that support BaaS innovation. Invest in regulatory technology (RegTech) solutions to automate compliance processes and stay ahead of regulatory changes. ### **Cybersecurity and data privacy** Implement robust cybersecurity measures, including advanced encryption, access controls, and incident response plans. Establish data governance frameworks to ensure the secure and ethical use of customer data. Collaborate with cybersecurity experts and industry partners to stay informed of the latest threats and best practices. ### **Legacy systems integration** Develop a strategic roadmap for modernizing legacy IT infrastructure, leveraging cloud-based solutions and microservices architecture. Adopt a "build-and-buy" approach, selectively replacing legacy systems with modern, API-enabled platforms. Invest in training and upskilling employees to manage the new technology stack. ### **Talent acquisition and retention** Offer competitive compensation and career development opportunities to attract and retain talent with specialized BaaS skills. Establish partnerships with universities and technical training programs to build a pipeline of qualified candidates. Implement cross-functional training and knowledge-sharing programs to upskill existing employees. ### **Ecosystem collaboration** Establish clear governance structures and communication channels to facilitate seamless collaboration among BaaS partners. Develop shared risk management and compliance frameworks to ensure consistent standards across the ecosystem. Organize industry events, hackathons, and workshops to foster innovation and knowledge-sharing. ### **Balancing innovation and stability** Adopt a "test-and-learn" approach, piloting new BaaS solutions with select partners and iterating based on customer feedback. Implement robust change management and communication strategies to ensure a smooth transition for customers and internal stakeholders. Maintain a strong focus on customer experience and reliability while continuously innovating the BaaS offerings. By addressing these challenges proactively and strategically, banks and non-financial companies can position themselves for success in the rapidly evolving BaaS landscape, paving the way for a more integrated, customer-centric, and responsive financial ecosystem. ### Top 15 CFO skills every finance leader should master URL: https://www.financealliance.io/top-10-cfo-skills/ Last updated: 2026-01-28T16:43:23.000Z Back in the day, a Chief Financial Officer's (CFO) job was pretty straightforward - crunch some numbers, keep the accounts in check, and make sure the balance sheets were all squared away. But fast forward to today, and modern CFOs are doing so much more than just focusing on financial statements. The [role of the CFO](https://www.financealliance.io/podcast/4-roles-every-cfo-must-dominate-changing-role-of-the-cfo/) has really evolved alongside technology. They've become true partners in the business, stepping into more of a leadership role within their organizations. And they're collaborating with other departments besides just finance more than ever before. CFOs aren't just dipping their toes into these new roles and responsibilities. They're diving in headfirst, embracing their roles as leaders, coaches, mentors, and motivators. The modern CFO wears many hats and must master a variety of CFO skills. But what skills does the CFO of the future need to stay on top of their game? Keep reading as we uncover some of the most important Chief Financial Officer skills, including: - [Financial expertise](https://www.financealliance.io/top-10-cfo-skills/#financial-expertise) - [Strategic planning](https://www.financealliance.io/top-10-cfo-skills/#strategic-planning) - [Risk management](https://www.financealliance.io/top-10-cfo-skills/#risk-management) - [Investment savvy](https://www.financealliance.io/top-10-cfo-skills/#investment-savvy) - [Influence & persuasion](https://www.financealliance.io/top-10-cfo-skills/#leading-teams-influence-persuasion) - [Communication skills](https://www.financealliance.io/top-10-cfo-skills/#communication-skills) - [Decision-making CFO skills](https://www.financealliance.io/top-10-cfo-skills/#decision-making) - [Emotional intelligence](https://www.financealliance.io/top-10-cfo-skills/#emotional-intelligence) - [Reliable & trustworthy](https://www.financealliance.io/top-10-cfo-skills/#reliable-trustworthy) - [Critical thinking & problem solving](https://www.financealliance.io/top-10-cfo-skills/#critical-thinking-problem-solving) - [Global compliance](https://www.financealliance.io/top-10-cfo-skills/#global-compliance) - [Ethical standards](https://www.financealliance.io/top-10-cfo-skills/#ethical-standards) - [Business acumen](https://www.financealliance.io/top-10-cfo-skills/#business-acumen) - [Innovative & adaptive](https://www.financealliance.io/top-10-cfo-skills/#innovation-adaptability) - [Negotiation skills](https://www.financealliance.io/top-10-cfo-skills/#negotiation-skills) --- *Psst! Why not download this article in eBook format, so you'll always have these insights at your fingertips?* [Download your eBook here](https://productmarketingall.typeform.com/to/hFpFfhSv) --- ## Driving IMPACT | Essential skills every CFO needs to have For a more in-depth look at the top CFO skills, keep reading... ## **Core CFO skills** ### **Financial expertise** The core foundation for any CFO is a deep understanding of financial principles like accounting, financial reporting, tax planning, budgeting, and forecasting. A CFO must be able to interpret all that complex financial information and [communicate it clearly to stakeholders](https://www.financealliance.io/stakeholder-communication-plan/), making sure decisions are grounded in solid financial data. This core competency is what allows the CFO to effectively manage the company's overall financial health. They have to be able to identify risks and opportunities that could impact the bottom line, both good and bad. Financial expertise is one of the most important CFO skills because it’s vital for keeping the business on solid financial footing. It's the bedrock that all their other skills are built upon. --- ### **Strategic planning** These days, CFOs can't just focus on the numbers. They need to use their financial expertise and insight to help drive the overall strategic decisions for the business. This means really understanding the [BIG picture](https://www.financealliance.io/10-big-picture-financial-planning-steps/) \- the market landscape, who the competition is, and what the long-term goals are for the organization. By aligning the financial planning with the broader business strategy, CFOs play a pivotal role in shaping the direction the company will take. They help steer the company through new growth opportunities, while also [navigating any challenges](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/) or potential roadblocks that might come up. Put simply, CFOs have to think strategically and use their financial know-how to help chart the course for where the business is headed. They're navigators *and* strategic partners, working hand-in-hand with the executive team to drive success. ### **Risk management** CFOs are risk management pros. They take the lead when it comes to limiting and mitigating the impact of a crisis. Better yet, they’re often the reason a crisis doesn’t happen at all because they spot the risks early and put the right plans in place. But managing risk isn’t just about reacting. It’s a process - one that CFOs lead with a mix of experience, foresight, and strategy. At the heart of it are four key pillars: ![CFO skills - 4 pillars of risk management](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/4-pillars-of-risk-management.png) **1\. Risk identification** First things first - you've got to spot the potential issues before they become problems. This means looking across the business and asking, “What could go wrong here?” Whether it's financial risk, compliance issues, or supply chain disruptions, a good CFO is constantly scanning for weak spots. **2\. Risk assessment** Once you've identified the risks, it's time to figure out how serious they are. What’s the likelihood of them happening? What kind of impact could they have on the business? CFOs assess risks across the board (from liquidity and debt to personnel and IT) to prioritize what needs tackling first. **3\. Risk mitigation** Now for the action part. Risk mitigation is all about putting safeguards in place such as reducing the chances of problems arising, or softening the blow if they do. This could be anything from building financial buffers, to introducing new internal controls, to diversifying suppliers. Smart planning makes all the difference. **4\. Risk monitoring** Finally, you’ve got to keep watch. Risks change, new ones emerge, and mitigation strategies need updating. CFOs stay on top of the numbers and the narrative—regularly reviewing the risk landscape, updating the board, and making sure the business stays protected over time. [Risk management](https://www.financealliance.io/financial-crime-risk-management-fcrm/) is a crucial CFO skill. Keeping the business out of hot water is a CFOs bread and butter. ### **Investment savvy** Successful CFOs have a keen eye for the right investments that align with the company's strategic goals. It's about knowing where to park the company's funds so they don't just sit idle but actually work to bring in *more* value. This could mean anything from investing in new technologies that could give the company a competitive edge, to expanding into new markets, or even [acquiring another business](https://www.financealliance.io/acquisition-financing/) that could open up new revenue streams. Now, here's the thing: markets are unpredictable. They go up, they go down, and sometimes they take turns nobody saw coming. A CFO with good [investment](https://www.financealliance.io/chief-investment-officer-vs-chief-financial-officer/) skills isn't just reactive; they're *proactive*. They have their finger on the pulse of market trends, understand the broader economic landscape, and can forecast potential shifts that could affect the company's investments. This foresight is crucial because it means the CFO can pivot strategies as needed, protecting the company from financial pitfalls while capitalizing on opportunities. --- [CFO interview questions and answersIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-135.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/CFO-interview-questions-2-2.jpg)](https://www.financealliance.io/cfo-interview-questions-and-answers/) --- ## **Leadership, communication, & CFO soft skills** ### **Leading teams (influence & persuasion)** Today’s CFOs are leaders through and through. They’re heavily involved in not only managing and leading a team but also assisting with [team building and recruitment](https://www.financealliance.io/finance-talent/). Therefore, successful CFOs must have good leadership skills. Bringing the team together and making sure everyone is supported and empowered within their roles is so important. The CFO needs to be a great leader who can strategically manage the team. They also must take leadership in the C-Suite. This involves showcasing leadership skills when assisting the CEO and other board members with key decision-making. By articulating the why behind decisions and painting a clear picture of the end goal, a CFO can rally their team to push through challenges and achieve great results. So [leadership](https://www.financealliance.io/financial-leadership-in-changing-times-2/) \- getting people aligned, motivated and moving in the right direction – is one of the most vital CFO skills every CFO must try to master. ### **Communication skills** If you want to be a successful CFO, it’s time to brush up on your people skills. [Communication](https://www.financealliance.io/cfos-role-in-investor-communications/) is a big part of the CFO's role because they talk to a variety of people. This includes board members, shareholders, investors, suppliers, customers, and employees. The CFO of tomorrow must be a superb communicator. They must be able to share company messages with people outside of the organization as clearly as possible. And… they’ve got to have a knack for communicating complex information (such as data insights) to people who lack the same level of understanding. So whether it's explaining the financial rationale behind a tough decision that had to be made, or sharing updates on the company's overall financial health and vision for the future, the way a CFO communicates can have a *huge* impact. It shapes team morale, instills confidence in stakeholders, and helps align everyone around the company's strategic direction. ### **Decision making** CFO skills like decisive leadership and analytical prowess are absolutely crucial. These financial leaders face tough choices every day that could significantly impact the company's future. It’s not just about having a keen analytical mind to crunch the numbers. Top CFOs also need the courage and confidence to make the hard calls when necessary. They can’t afford to sit on the fence. Great decision-making isn’t guesswork — it’s a repeatable process. That’s where the **CFO Decision-Making Loop** comes in: ![CFO decision-making loop - skills for CFOs](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/CFO-decision-making-loop.png) This cycle plays out across all areas of the business, from managing cash flow to planning investments or navigating risk. It's about carefully weighing all the options, considering the potential implications, and then decisively acting with the company's best interests as the top priority. Balancing data-driven insights with bold leadership is what separates the best CFOs from the rest. --- [13 effective tips to allocate budget across departmentsBudget allocation is the process of designating specific amounts of money to each department within a company. This article highlights 13 tips for successful budget allocation across departments…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/budget-allocation-1.jpg)](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) --- ### **Emotional intelligence** One of the most important CFO skills that often gets overlooked is emotional intelligence. A CFO with high emotional intelligence (EQ) is *gold*. They understand their own emotions and can read the room like a book. So, what exactly is emotional intelligence? Emotional intelligence (EI or EQ) is the ability to recognize, understand, manage, and use your own emotions in positive ways to: - Relieve stress - Communicate effectively - Empathize with others - Overcome challenges - Defuse conflict It also involves recognizing and understanding the emotions of others, which is essential for building and maintaining healthy relationships, both personally and professionally. Emotional intelligence is often broken down into four core skills, grouped under two main competencies - personal and social. On the personal side, you have self-awareness and self-management. **Self-awareness** is really understanding your own emotions, strengths, weaknesses, and having that self-confidence. **Self-management** is controlling impulses, managing emotions healthily, taking initiative, following through on commitments, and adapting as needed. Socially, it's about awareness and relationship management. **Social awareness** means understanding the emotions, needs and concerns of others, picking up on cues, feeling comfortable in groups, and recognizing power dynamics. **Relationship management** involves developing rapport, communicating clearly, inspiring and influencing people, collaborating well, and managing conflict productively. To be a good CFO, you’ve got to step into the roles of not only leadership, but the role of coach, motivator, and collaborator - all of which requires a high degree of emotional intelligence. ### **Reliable & trustworthy** For a CFO, being seen as reliable and trustworthy is non-negotiable. It's an essential leadership quality. People need to know beyond a shadow of a doubt that they can count on their CFO to be completely honest, ethical, and consistent through and through. This bedrock of trust lays the foundation for everything - from having a loyal, dedicated finance team to instilling confidence in [investors and stakeholders](https://www.financealliance.io/cfos-role-in-investor-communications/). When a top CFO makes a commitment or says they'll do something, it's ironclad. Their team and colleagues know it's as good as done. They never have to second guess or worry. A CFO who projects an aura of trust elevates their whole organization. It fosters an environment of accountability and integrity. Integrity like that is priceless. It gives CFOs true authority and gravitas that money can't buy. Their teams know they can always be relied upon to do the right thing, to have their backs, to give it to them straight. And that's what allows top CFOs to rally people and inspire excellence. ### **Critical thinking & problem solving** Critical thinking and problem-solving are very important CFO skills. After all, the business world can be messy - full of complex problems and unexpected challenges popping up left and right. As a CFO, you can't just take things as they come. You've got to always be thinking several steps ahead, analyzing situations from every angle to find the best solutions. The best CFOs are able to anticipate potential issues before they even happen and put measures in place to prevent them from impacting the business. By leveraging their sharp critical thinking and problem-solving abilities, CFOs can cut through the noise and complexity to get to the heart of an issue quickly. They size things up with a clear head and objectivity. And then they take action - decisively driving solutions that nip problems in the bud. --- [M&A best practices: Navigating successful dealsTo help you craft a winning deal, we’ve compiled some M&A best practices that can help you not only survive the ordeal but also thrive, turning potential pitfalls into opportunities for growth. 🚀![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/compass-7592447_1280.jpg)](https://www.financealliance.io/m-a-best-practices/) --- ## **Regulatory and compliance understanding** ### **Global compliance** With businesses operating across borders and multinational regulations, CFOs have to stay up-to-speed on compliance requirements worldwide. It's not just the local rules anymore. Top CFOs deeply understand global compliance demands - taxes, trade, labor laws, you name it. They make sure their companies follow the letter of the law in every market they do business. Ignorance isn't an excuse when millions are on the line. Global compliance mastery is a must-have for CFOs. ### **Ethical standards** At the end of the day, CFOs are stewards of the financial conscience. They have to embody the highest ethical standards to protect the company's integrity and reputation. From adhering to accounting principles to ensuring ethical business practices, the buck stops with the CFO. They lead by example, instilling a culture of honesty, transparency, and moral fortitude. An ethical CFO earns stakeholder trust and sets the right tone for the whole organization. Cutting corners is never an option when ethics are at stake. --- [How to create a CFO mission and vision statementIn this blog post, we shed some light on how an established vision can drive success for your company. We’ll also share some CFO mission and vision statement examples and teach you how to create one of your own.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/07/CFO-Mission-header-image-2.jpg)](https://www.financealliance.io/cfo-mission/) --- ## **Strategic business skills** ### **Business acumen** One of the most vital CFO skills is having that sharp business acumen - seeing the company through a wide-angle lens. It's about understanding the bigger business landscape that exists outside of just the finance department's four walls. ![CFO top skills - business acumen](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/06/business-acumen.png) A top CFO is always plugged into how external factors - market trends, what competitors are doing, regulatory changes and so on - impact their specific business. But it goes even deeper than that. True business acumen means aligning the [financial strategy ](https://www.financealliance.io/optimizing-your-financial-strategy-to-account-for-downturns-and-esg-factors/)and planning with the overall goals for the company as a whole. Every financial decision a CFO makes should tie back to supporting the core [mission and vision](https://www.financealliance.io/cfo-mission/). It's about having that holistic perspective that connects the dots between finance and the big picture strategy. With business savvy like that, CFOs can anticipate potential roadblocks and challenges before they happen. But they also spot exciting opportunities that others might miss. Their wide-angle vision makes them indispensable advisors to the CEO and the board. The CEO knows they can rely on the CFO's business smarts and counsel. It's why the best CFOs have a seat at that leadership table - adding immense value with their cross-functional business prowess. Some tips to help you build your business acumen skills include: 1. **Get out of the finance bubble.** Shadow colleagues in other departments like sales, marketing, or operations. See firsthand how different business functions operate and the challenges they face. 2. **Read industry publications and analyst reports.** Stay up to speed on broader market trends, competitive dynamics, emerging technologies, and macroeconomic factors impacting your industry. 3. **Attend cross-functional meetings.** Don't just stick to the finance team's meetings. Regularly sit in on product, strategy, or leadership team huddles to get that big picture perspective. 4. **Meet regularly with the CEO.** Set recurring 1-on-1 time with the chief executive. Get their vision and priorities and make sure the financials align with and support the overarching company strategy. 5. **Take an online course.** Enroll in a business strategy, management, or leadership program to build more holistic business skills outside of just finance and accounting. 6. **Find a mentor.** Seek out someone preferably a former CFO, who has walked the path you're on. They can provide invaluable advice on elevating business smarts. ### **Innovation & adaptability** The business world is in a constant state of flux, with new technologies and business models emerging at a rapid pace. CFOs must therefore embody innovation and adaptability. This means being open to new ideas, whether it's adopting [new financial technologies](https://www.financealliance.io/finance-alliance-tools-of-choice/) or rethinking traditional business processes. But it's not just about being open to change; it's about being a change agent within the organization. By fostering a culture that values creativity and flexibility, CFOs can lead their teams in adapting to changes seamlessly, ensuring the company remains competitive and agile. ### **Negotiation CFO skills** [Negotiation skills](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/) are absolutely vital for modern CFOs. It's really an art form that they have to master. Think about it - CFOs are constantly negotiating high-stakes deals across the business. Whether it's hammering out terms with investors, finalizing contracts with suppliers, or closing agreements with key strategic partners, their negotiation prowess can make or break the company's bottom line. Top CFOs strike just the right balance - they're assertive and fight hard for the best deal, but they also have empathy. They deeply understand the perspectives and priorities of everyone involved. And that allows them to get creative and structure true win-win solutions where everybody walks away happy. When a CFO can negotiate with skill and nuance, it opens the door for them to secure incredibly favorable terms and conditions that support the health of the business both financially and strategically. They're not just checking boxes but aligning all the pieces. --- ### FAQs: CFO skills What are the core skills every CFO needs? Every CFO needs a robust set of core skills, including deep financial expertise, strategic planning abilities, proficiency in risk management, leadership and communication skills, technological savvy, and an understanding of regulatory and compliance issues. These skills enable a CFO to manage a company's financial health and contribute to its strategic direction. What are the key responsibilities of a CFO? CFOs are responsible for financial planning and analysis, managing the company's finances, strategic planning, risk management, data analysis, and ensuring compliance with financial regulations. What are the qualities of a CFO? Key qualities include strategic thinking, analytical skills, integrity, adaptability, emotional intelligence, and a forward-looking perspective. How important is technological proficiency for a CFO? Technological proficiency is increasingly critical for CFOs, as financial technologies (FinTech) play a pivotal role in streamlining operations, enhancing data analysis, and securing financial transactions. A tech-savvy CFO can leverage these tools to drive efficiency, inform strategic decision-making, and protect against cyber threats. Why are strategic partnerships important for a CFO? Strategic partnerships are important for CFOs because they can open up new growth avenues, facilitate access to new markets and technologies, and optimize operational efficiencies. By building and maintaining strategic alliances, CFOs can support their company’s growth objectives and enhance its competitive edge. Is the CFO role stressful? Yes, the CFO role can be stressful due to its high level of responsibility, the need for accuracy in financial management, and the pressure to support strategic decisions. What makes you the ideal candidate for a CFO position? The ideal candidate possesses a blend of financial acumen, strategic thinking, leadership qualities, and the ability to adapt and innovate, along with a track record of contributing to business growth and efficiency. --- ### Develop your skills at our CFO Summit! This is an exclusive, invite-only gathering of C-suite finance leaders. Request your invite to take advantage of this unrivaled networking, and learning opportunity so you can: - Build local a network of connections within our global CFO community. - Turn your finance function into a world-class operation. - Gain a strategic edge by leveraging the latest trends & emerging tech. - Improve your CFO skills and smash your career goals. ...and so much more! [See our Events Calendar ](https://events.financealliance.io/) ### Fast-tracking your FP&A career: Insider tips, success stories, and networking strategies URL: https://www.financealliance.io/fast-tracking-your-fp-a-career-insider-tips-success-stories-and-networking-strategies/ Last updated: 2025-05-12T08:59:00.000Z Now’s your chance to fast-track your FP&A career with exclusive insights, success stories, and proven networking strategies—direct from finance industry leaders. This is a unique opportunity to gain insider knowledge and career advice from top professionals in Financial Planning & Analysis. Hosted by Finance Alliance, this live session will equip you with the tools you need to grow, connect, and thrive in the world of FP&A. Simply sign up to join us live. 🎯 Learn actionable strategies to accelerate your FP&A career 📈 Deepen your understanding of career pathways and industry expectations 🤝 Expand your professional network with likeminded finance peers 🧠 Hear real success stories from those who’ve done it --- **Date:** June 26, 2025 **Time:** 6:00pm GMT **Location:** Online Whether you’re climbing the FP&A ladder or just stepping onto the first rung, this session is your opportunity to gain momentum. Join us for an exclusive conversation with [**Jon Yuregir**](https://www.linkedin.com/in/jon-yuregir-6b87904/), a seasoned finance leader with firsthand experience in building a thriving FP&A career. He’ll share the lessons, strategies, and mindset shifts that helped him get ahead—and how you can, too. --- ### In this session, you’ll discover: 🚀 Career shortcuts and strategies for early and mid-stage FP&A professionals 📚 What hiring managers are really looking for in top FP&A talent 🤝 The power of professional networking—and how to do it right in finance Ready to take your career to the next level? Sign up now and start fast-tracking your future in FP&A. --- ### Meet the speaker: [**Jon Yuregir**](https://www.linkedin.com/in/jon-yuregir-6b87904/), Group FP&A Director at International Workplace Group plc Jon brings years of FP&A leadership experience across high-growth companies, helping professionals make smarter decisions and grow faster in their roles. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/05/Jon-Yu-easyjet-1.jpeg) ### AI for Finance Summit: Speaker Spotlight with Tripti Nashier URL: https://www.financealliance.io/ai-for-finance-summit-speaker-spotlight-with-tripti-nashier/ Last updated: 2025-10-08T09:08:20.000Z The [AI for Finance Summit 2025](https://virtual.financealliance.io/location/aifinance/) is just around the corner, and we’re thrilled to spotlight one of our incredible speakers: Tripti Nashier, Finance Manager at Amazon. Known for building smart, scalable forecasting models and championing innovation within one of the world’s most complex finance organizations, Tripti brings a pragmatic yet forward-thinking lens to AI in finance. In her upcoming panel discussion, '*Overcoming AI adoption barriers in finance: Practical steps for implementation*', Tripti will dive into a challenge many finance teams face: getting AI out of the pilot phase and into full production. It's not just about choosing the right tools - it's about navigating internal blockers, aligning stakeholders, and laying the operational groundwork to make AI truly work. We sat down with Tripti to talk about her upcoming talk at the AI for Finance Summit and her previous talk at the FP&A Summit. So, let’s jump into our conversation. [Grab your free pass to AI for Finance Summit!](https://virtual.financealliance.io/location/aifinance/register) ### Can you tell us about yourself and your role at Amazon? I'm Dr. Tripti Nashier, a Finance Manager at Amazon, where I lead design and implementation of advanced financial planning solutions that integrate operational data, forecasting, and cost attribution across business functions. My work spans novel solutions in financial forecasting, revenue management, workforce optimization, and fulfillment cost attribution. My innovations have been adopted at large scale operations and recognized across academic and industry platforms. I hold a Ph.D. in Finance, and outside of work, I’m an active researcher having published extensively, and a contributor to global finance conferences. I remain deeply engaged in pushing the frontier of financial systems innovation. ### What did you speak about at the FP&A Summit, and what inspired you to choose this topic? At the FP&A Summit, I spoke about the transformative impact of [fintech](https://www.financealliance.io/fintech-and-ai/) innovations in integrated financial management including workforce optimization, [revenue management](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/), and inventory cost attribution. I chose this topic because traditional financial systems often fall short in today’s volatile environment, and these frameworks are designed to bridge that gap, delivering enhanced accuracy, agility, and cross-functional collaboration for global enterprises. ### What was the main message or key takeaway you wanted attendees to gain from your presentation at FP&A Summit? The key message was that finance is going to evolve from a retrospective reporting function into an operationally intelligent system that drives enterprise execution. I shared frameworks using which businesses don’t need to compromise between efficiency, accuracy and operational agility. With the right technical systems, they can improve all the dimensions simultaneously without traditional trade-offs. For example, [improving forecast accuracy](https://www.financealliance.io/4-tips-for-accurate-sales-forecasts-video/) while reducing forecasting cycle time for revenue management or saving costs while maintaining service levels. Organizations must transition from static, linear models to architectures that combine operational signals, predictive analytics, and financial governance into integrated frameworks. --- [10 tips to eliminate forecast biasNo matter how sophisticated our models get, forecast bias has a sneaky way of slipping into our financial plans. If you want to stop forecast bias from creeping in, here are 10 practical ways to put an end to it.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-127.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--5--1.png)](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) --- ### What will you speak about at the AI for Finance Summit, and what has inspired you to choose this topic? I will be speaking on "Overcoming AI Adoption Barriers in Finance: Practical Steps for Implementation." Financial organizations recognize AI’s potential to revolutionize integrated financial management. However, moving beyond proof-of-concept to large-scale adoption remains an obstacle. My inspiration comes from my experience architecting financial systems that integrate predictive insights directly into financial management at enterprise scale. The deployment journey revealed patterns of common hurdles, tactical breakthroughs, and the mindsets that separate stalled projects from transformative outcomes. In this event, I will present a practitioner's guide to overcome the barriers and capture the full power of AI. ### What is the main message or key takeaway you want attendees to gain from your upcoming presentation? My key message is that success lies in designing financial frameworks that fit naturally within operational workflows, evolving with the business instead of working against it. Finance teams must go beyond model-building to design systems that learn, adapt, and integrate into the day-to-day execution of financial strategy. When financial systems are architected with operational realities in mind, we can unlock AI’s full potential as a competitive differentiator in this increasingly digital economy. ### Who do you think benefited the most from your session, and why was your presentation particularly valuable to them? Finance leaders and operational planners in sectors with complex multi-product operations such as technology, e-commerce, manufacturing, and energy, found immediate relevance. The attendees are dealing with shifting demand, unpredictable cost behaviors, and mounting pressure for agile planning. They saw conceptual solutions that are live, implemented, and delivering quantifiable improvements. My solutions directly addressed pain points they face daily from achieving tens of millions in cost savings, to improving forecast accuracy, and improving efficiency in operational cycle. It provided them with real-world, scalable system to apply in volatile conditions. ### How did attendees respond to your presentation? Were there any interesting questions or discussions that stood out? The response was highly positive with high engagement. Attendees explored how to implement these solutions to different industries like healthcare and sustainability where financial forecasting is complicated by variability. Several executives were particularly interested in how my system’s architecture identifies and could proactively identify revenue risks for regional markets ahead of traditional methods. There was also strong interest in new metrics which reveal holding inefficiencies invisible in traditional systems. The adaptability and practical success of these frameworks resonated deeply. ### Looking back, what’s one insight or takeaway from the previous event that resonated with you? One powerful insight was the urgency among finance leaders to move toward integrated, predictive, and actionable financial systems with strategic intelligence. The discussions reinforced the requirement of integrated financial management that embraces technological advancements. There is enthusiasm among leaders to adapt solutions that are both architecturally advanced and aligned with operational constraints. In many ways, the FP&A Summit reinforced the rationale behind my approach to financial architecture design that organizations are facing increasing complexity and ready to adopt smarter, more adaptive systems. --- [How CFOs are powering business strategyThis blog explores how today’s CFOs are stepping beyond traditional finance roles to become strategic partners - driving growth, shaping business decisions, and turning financial insight into organizational impact.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-128.png)Finance AllianceNick Rumball![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--52--1.png)](https://www.financealliance.io/how-cfos-power-business-strategy/) --- ### What’s the best career advice you’ve ever received? > *"Build systems that outlast circumstances."* This advice shaped my approach to developing financial solutions that are resilient and adaptable and hence continue to deliver value even in the face of market volatility, technological disruption, and organizational change. It has guided me to prioritize long-term utility over short-term fixes, ensuring the architecture I design supports sustained decision-making and strategic agility. ### What advice would you give to young professionals starting out in the finance industry? Don’t limit yourself to traditional finance boundaries. Today, professionals need to understand how finance connects to operational levers, technology ecosystems, and strategic decision-making. It is important to learn skills to build beyond analysis, we need to build systems and architectures that solve problems, scale with the business, allow for simulation, flexibility, and speed. It is equally important to share and publish your ideas to collectively grow with others. Don’t underestimate the value of intellectual rigor because it multiplies the influence of your work. Some of my most impactful work came from merging academic insights like my work on ownership concentration, Bitcoin investment credentials and financial integration with enterprise applications. ### For those who want to continue the conversation, how can attendees connect with you or learn more? I'm always happy to connect through my LinkedIn at [linkedin.com/in/triptinashier](https://www.linkedin.com/in/triptinashier/), to share my work and thoughts on next-generation financial strategy. You can also find my frameworks referenced in publications like Forbes, Dataconomy, and TechTimes, or read my scholarly work through research databases such as Google Scholar and Web of Science, where my research on corporate finance, Bitcoin investment, and market integration continues to receive global citations. --- ## **AI for Finance Summit** Learn how to put AI to work in your finance strategy when you attend our online [AI for Finance Summit](https://virtual.financealliance.io/location/aifinance/). By the next day, you'll know exactly what you need to do to create faster forecasts, tighter controls, smarter decisions. See how AI is reshaping forecasting, fraud detection, ops, and compliance. Get real-world use cases, smart strategies, and plug-and-play ideas to boost efficiency and ROI. [Grab your free pass](https://virtual.financealliance.io/location/aifinance/register) to catch all live sessions and get full access to every recording. [Grab your free pass](https://virtual.financealliance.io/location/aifinance/register) ### How to optimize finance teams through people, technology, & structure URL: https://www.financealliance.io/how-to-optimize-finance-teams/ Last updated: 2026-03-20T17:07:38.000Z Everybody is currently struggling with resources. Because of inflation and a generally unstable environment, you can't really just go out and hire people. I'm going to talk about how you can optimize your current team and make sure you can cover more ground with the teams that you already have. ## Why are we here? Popular topics in finance at the moment include optimizing cash flow, nurturing [high-performance teams](https://www.financealliance.io/finance-talent/), and the evolution of the modern CFO. But how do you actually do these things in day-to-day life? I’ve been a part of finance teams myself, and I know what it’s like when your boss comes to you and says, “We’re going to do [ESG reporting](https://www.financealliance.io/7-benefits-of-esg-investing/),” or some other brand new task. Your existing work is still there, and you're piling on even more. That's just not sustainable. I'm going to walk you through two case studies which are essentially client stories. I'll also talk about the frameworks that I’ve used to deliver these transformations and the key things to watch out for in terms of the framework. ## Case study 1: Finance transformation The first case study I want to talk about is [finance transformation](https://www.financealliance.io/your-guide-to-finance-transformation/). This is where we changed the whole finance team. It was a multi-site, multi-country business. Each country had its own finance team consisting of two to four people, and they ended up having almost 25 to 30 finance professionals in FP&A. But they weren’t exactly doing the FP&A work. It was muddled-up work with no clear focus. So, the ask was to reduce the cost (as they couldn’t afford 25-30 people), create specialization, support strategic design, and create efficiency and effectiveness of the finance function. First, we created an entire list of activities done by the finance professionals. We then segregated these activities between controllership and FP&A, what maintained activities and statutory activities were being done. Finance leaders need to understand that to specialize between teams, you need to first be aware of what activities are being carried out, and that needs to be segregated between teams so each team can specialize in what they do. We then put in a data hub, which meant that all data came from a single source, and all the data was then reconciled to the mandatory statutory books as well as the management [books](https://www.financealliance.io/11-must-read-fp-a-books/), and the numbers were always consistent. The result was that we improved the visibility of financial metrics and saved costs because we reorganized the teams and were able to redeploy some of the resources in other functions and organizations. We sped up strategic decision-making because the data was available so easily. You were able to make financial decisions by negotiating with third-party distributors and external warehouse people. The clarity of people's careers was improved as well. Even the individuals who were moved around were put in roles that they actually enjoyed. Therefore, they were very clear on what their career paths were, instead of having a vague, generalized job title. So, that was a large transformation project where we identified processes, assessed people, and deployed technology to transform and deliver results that were necessary for the business to progress. --- [CFO vs CPA: Does a CFO need a CPA?There’s no rulebook saying you must be a CPA to excel as a CFO. In this blog post, we clear up the confusion between CFOs and CPAs and explore whether you need a CPA to become a successful CFO (spoiler - you don’t!).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/05/cfo-vs-cpa-image.jpg)](https://www.financealliance.io/cfo-vs-cpa/) --- ## Case study 2: Reporting and analytics Now, I’ll take you through another example which was delivered very recently for a customer. A board deck was taking over seven working days to put together. Everything was in Excel, and formulas were being updated manually to calculate a ruling average of revenue. This resulted in so many errors. When we took up the project, we were able to point out to the client that last month they’d forgotten to update the formula and the previous month’s [KPIs](https://www.financealliance.io/infographic-financial-performance-metrics/) were reported wrongly to the board. So, the ask was to automate as much as possible, release time and resource for better analytics so they could create a better commentary, provide a connected picture of the business, and implement KPIs we thought were appropriate for that particular business. We implemented [Power BI](https://www.financealliance.io/copilot-in-power-bi/) and Excel, but Excel was connected to Power BI, which meant there was no manual updating of any formulae. All calculations and data sat in the Power BI environment. We redesigned a dashboard for KPIs and decision support so that the board could actually have a specific conversation rather than just have a bunch of data and numbers thrown in their faces. Before, they were taking seven days to gather and validate the data and put it in tables and graphs. That became basically less than two minutes to do. You opened the deck, hit refresh, and all your numbers were the latest numbers. And that was it, you're done. The instant feedback from the finance director was, “*Every month, I was adding commentary, but after seven days of laborious work, I was so tired that I’d just put in something that was okay and get on with it. Now, I actually have time to understand the performance, ask questions to other functions in the business, and provide insightful commentary*.” For me, that was the best customer feedback we could hope for because not only was it accurate, but it improved staff motivation, enabled more future-focused conversations in the business, and there was more time for better, insightful commentary. But to achieve this kind of process and these kinds of results for our clients, we operate using a certain framework. --- [How finance digital transformation can impact your companyIn today’s fast-paced business world, finance digital transformation is crucial for organizations to stay ahead of the game. From streamlining processes and increasing efficiency to providing real-time insights and improving data accuracy, financial transformation is the ultimate game changer.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/01/finance-digital-transformation-header-image.jpg)](https://www.financealliance.io/how-finance-digital-transformation-impact-company/) --- ## The Ways of Working framework The framework which we operate under is called the ‘Ways of Working.’ We’re constantly focused on our clients in terms of how they’re delivering their analytics, reporting, budget, and forecast. How are they doing [business partnering](https://www.financealliance.io/finance-business-partnering-playbook-2/)? What are the touch points? What are the decision-making conversations that they’re having within the business? What are the challenges they’re facing? How are they looking to save money? Are they looking to expand revenue? Are they looking to improve margins? The framework in which we operate is **people**, **organization**, and **technology**. We believe these three interact; people use technology and processes to create data. You get multi-layered data and multi-dimensional information, and that needs to be managed correctly for the business to be able to actually work and look forward. That data then supports your performance management and compliance with your auditors, controllership teams, and statutory reporting, and that needs to be done in an efficient and effective manner. This is the whole picture coming together of taking people, the organization, and technology, understanding the data they’re producing, and making sure that that data supports statutory performance management and the effectiveness and efficiency of the business. ![](https://lh7-us.googleusercontent.com/ffT6aWuR_U_2XpyS8F8Ww00zlFwBqS_a-VbYBn3nu0whVIOly0VNU0xuuI8War3KJpEa_Gj4AYzRzxY3VjPPS_hqYK83WCAjxSzMI7ECi5Jf_d1Ks6iFxjxDCuG5MXVODkxrHYUAcsYHUyr7PNG6CGc) So, let's understand how exactly you do that. What's the magic sauce? ### People Firstly, focus on the people. There are technical skills that you need to get a job in finance, whether it’s in accounting, FP&A, or controllership: - Accounting knowledge - Excel/tech skills - Budgeting/forecasting skills - Business acumen - Financial modelling - Analytical abilities These are the soft skills you need: - Communication - Presentation - Organization - Negotiation - Empathy - Adaptability We also talk about attitude. Attitude is comprised of two things: one is personality and another is energy for impact. There are tools out there that can be used to assess people's personalities. MBIT or Myers Briggs is one of my favorites. It asks questions like: - Are you outwardly or inwardly focused? - How do you prefer to take information? - How do you prefer to make decisions? - How do you prefer to live your outer life? This is what you can use to manage a person correctly and keep them from being demotivated. It doesn't necessarily mean that it will motivate them. For that energy for impact, we prefer the GC Index. There are five personality types, which include: - Game changer - Strategist - Implementer - Polisher - Playmaker It uses dimensions like: - Are you a pragmatic person or are you an obsessed person? - Are you imaginative or are you action-focused? What this index then helps you as a finance leader understand is what really motivates your team and brings out their best work. And if you use that correctly, then you can actually deploy people in the right manner within your business. Understanding their personality and what motivates them gives you a clear picture of their attitude, which means you can then deploy them correctly within the business to maximize the value they add. If people have communication skills but they’re much more introverted, then you want to make sure you're not putting them in too much of a public space which makes them uncomfortable and makes it awkward for them. Make sure that their personalities and their motivators are correctly complemented with the structure that you're giving them within the business. That's something that we consistently work with our [finance leaders](https://www.financealliance.io/3-principles-to-lead-with-confidence-through-change/) on to help them understand. --- [Finance Business Partnering Playbook | Finance AllianceThe step-by-step guide that takes you from a number cruncher to a strategic business partner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/01/FA_Finance_Business_Partnering_Playbook_Blog_2-2.png)](https://www.financealliance.io/finance-business-partnering-playbook-2/) --- ### Technology The next thing that we always talk about is the technology stack within finance. This is the piece that most finance leaders get quite easily. There’s an ERP, which has your finance packages inside it, there’ll be some sort of a CRM, an HRM/headcount mechanism, there might be timesheet data, other customer information, or other project-based information that they’re holding on to. They have all this information, but there’s nothing that’s connecting the dots together. They also have this beautiful vision. For example, they want to close month-end in three working days, they want detailed reporting and analytics, they want storytelling, they want to manage performance, they want to do driver-based budgeting, scenario planning, and all these wonderful things. The problem you get is that’s a strategic view. How do you connect it? Currently, 80 to 90% of FP&A functions are mainly Excel-focused. So now you're taking this level of data, these millions of rows, and trying to figure out how you analyze all of this information and do the reporting and analytics. You can't. It's just not physically possible. Accounting and controllership need their ERP, just like sales needs their CRM, FP&A needs its own environment, which is basically EPM and BI focused for them to be able to deliver the strategic vision of the leadership This is what we consistently find is missing within businesses. COVID has really helped to highlight this because as more people have started working from home, this awareness that Excel is just not going to cut it is increasing within financial leadership. But you still get businesses thinking, *Okay, if I implement a BI solution, my analytics will be sorted*, or, *If I implement a CPM or EPM solution, it’ll be sorted*. It won't until you have your technology architecture clearly defined and a clear flow of data with a vision of, *These are the items I want to analyze, this is the performance management I want to do, this is the driver-based budgeting I need to do*. Until you have that end-to-end clarity of the strategic view driven by the CRM or other drivers over here, you’re going to struggle as a finance function. So, having a proper architecture to interact with is critical for businesses to be successful with this, and we’ve consistently seen where we’ve implemented this correctly. Businesses have actually reduced the timelines for reporting and forecasting and improved decision-making. ![](https://lh7-us.googleusercontent.com/c_42STFYpWM6aX_JLfb-oAP3KDkrYVPWVM8oXXZ3seBDvzAo2yRbMCp01NkdMTncnGjw7LbmBFm1pNhZKWfEiYpOMkSGdnxgywWHd6WWEdh9bDUO0GLEfKuVWYar5SpKvcqisBR02DikpiDbfiZVTz8) ### Org structure The third pillar is organization structure. A function needs to be built around creating some sort of data hub, somebody who’s responsible for consistent data that’s reliable, accurate, and connected, preferably not only within finance, but finance collaborating with other functions in a connected and collaborative manner. There should be a bunch of individuals responsible for ensuring data is available correctly. That’ll create operational accuracy of the data you have, which then can be used by controllership, FP&A, performance management, and treasury to drive better decision-making, better decision support, and better analytics. This means you can have a statutory and compliance arm at a strategic level, and provides you with the ability to look forward and be a strategic leader. For example, you don't need to wait until the month-end to find your sales and then go to the sales leader or marketing leader and say, “We’re missing our forecast. What are we going to do about it?” You could do that in week one or week two of the month, and that way you can turn the volume up or down on what they need to achieve within the quarter or the month. It’ll then become a preventive and proactive activity rather than a reactive activity, which is after the month-end or quarter-end. ![](https://lh7-us.googleusercontent.com/jQkNCK2R1HWSObCBHvVmVeBAZaueo8rCxy6u6fwW1-9Bomi2HKEiVKq-FhhKH6BtRKz7V95xL8WktLt3R1GxmoBTrQUpVtCukqkANrqqIzvhHpDiWQPtbBTtA5yb7abjYan1E4SRiqK4JsYRqzZJdXQ) So, that’s the reason why the org structure is also very, very important, where controllership, FP&A, and treasury are supported correctly so that you can drive future ways of working. If you get the people, technology, and architecture correct, that’s when you’re now in a future-focused finance function that’s actually driving decision-making correctly and is able to add value. Rather than driving your car looking in the rearview mirror, you can start running your business car by looking through the windshield, and that’s what you want to do. --- ### Fraud detection in 2025: Lessons from a decade in the trenches URL: https://www.financealliance.io/fraud-detection-in-2025-lessons-from-a-decade-in-the-trenches/ Last updated: 2025-05-09T12:29:42.000Z When I began developing thorough anti-fraud systems for Yandex Market in 2018, many companies saw fraud as nothing more than a budget line item. To them, it was an acceptable cost of doing business. They set thresholds for chargebacks and lost revenue and only stepped in when those figures reached an uncomfortably high level. But sometimes I think of fraud as more than a financial nuisance and something that could just as easily defraud any one of us. I consider it a cornerstone threat to the trust that digital platforms have to earn if they are to exist and grow. If users can’t trust a platform to deliver on the essential promises it makes, such that the user experience will be authentic, fair, and safe, that platform will have a dangerously high churn rate and a lousy reputation. Platforms are just too easy to replicate and improve upon for the successful ones not to have both an authentic and a safe experience as their essential guideposts. --- [10 tips to eliminate forecast biasNo matter how sophisticated our models get, forecast bias has a sneaky way of slipping into our financial plans. If you want to stop forecast bias from creeping in, here are 10 practical ways to put an end to it.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-122.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--5-.png)](https://www.financealliance.io/10-tips-to-eliminate-forecast-bias/) --- ## **Beyond rule-based systems: the evolution of detection methods** At Yandex, we were heavily reliant on static, rule-based systems that functioned like automatons: if a user created too many accounts per day or paid with identical details across suspicious profiles, we flagged them. While these rules caught the obvious patterns (and did so quite well), they were far too rigid to keep pace with the quickly evolving tactics of our adversaries. Fraudsters figured out that it was much safer to shift between as many accounts as possible and to use a far broader range of (often plausible-sounding) cover stories. Our big breakthrough in countering this wave of badness came when we began to focus on behavioral fingerprinting and on grouping (or clustering) not just the overt actions of the users we flagged, but also the many subtle signals (like mouse movements, session lengths, and yes, quite a few signals that are unique to each person’s way of typing) that form a signature for each user. At our best, we could detect fraud because even when the bad guys were using new accounts or new IP addresses, they were still signing all their work with a unique fraudster fingerprint. ## **The balancing act: precision vs. friction** Throughout my career, one of the tough challenges I’ve faced has been ensuring that strong fraud defenses don’t result in a terrible user experience. We tried to express false negatives and false positives in terms of real money. A system can be just as damaging if it blocks lots of fraud but also a lot of good customers. I’ve also found that friction has a habit of creeping into the onboarding process. For instance, we might call for identity verification for new merchants or impose frequent authentication checks on repeat buyers. While these measures reduce fraud, they can also push honest users away. When we analyzed Meta’s onboarding flows closely, we discovered that certain verification steps were too strict, creating 80% onboarding friction. Adjusting those requirements by removing some steps or streamlining others maintained the same security level while removing hurdles for legitimate users that were unnecessary. A tiered approach is one of the most effective ones today: honest, low-risk users and transactions breeze through with little friction, while higher-risk interactions trigger robust post-checks during which the honest, low-risk user is hardly aware that any sort of transaction he or she is engaged in is anything but business as usual. During these periods when risk signals are spiking on the platform, we can afford to be a little more paranoid with the sorts of money and identity requests we’re willing to fulfill. ## **The multi-layered defense strategy** If there’s one lesson that has been learned during my years at both Yandex and Meta, it’s that no single tactic can cover all angles. Always remember: fraudsters are expert puzzle-solvers. Close one avenue, and they’ll try another. An effective anti-fraud program, therefore, is by necessity a multi-layered affair. For instance, at Yandex Market, we constructed a complete system that comprised of: - **User trustworthiness scoring**: assessing behavior to catch abusers of promo codes, returns, or special prices. - **Merchant authentication and quality assurance**: ensuring that merchants not only had the right credentials but also kept the promises that made them seem trustworthy in the first place. - **Detection of listing inflation and ad fraud**: stopping if not preventing attempts to make a product or an ad seem more valuable than it actually is. - **Transaction anti-fraud**: ensuring that we could spot and stop in a timely manner any attempts to use stolen credit cards or otherwise coordinate scams that employed our product as a way to get money. - **Monthly reporting**: compiling a report that would help us spot trends, figure out what was going on, and if possible, patch any weaknesses that we were responsible for. In addition to these basic functions, we had to think about and provide for quite a few other details. Separate safeguards address different ways that attackers might try to fool our systems. If a fraudster gets past one layer, another layer is likely to catch them. This setup hasn’t changed; what has changed is that the safeguards have become a lot more sophisticated, especially thanks to the more recent [adoption of AI-driven](https://www.financealliance.io/ai-in-finance-ebook-download/) anomaly detection and real-time data consolidation. This is still probably our best way to defend against all the ways that our systems can be attacked. --- [How CFOs are powering business strategyThis blog explores how today’s CFOs are stepping beyond traditional finance roles to become strategic partners - driving growth, shaping business decisions, and turning financial insight into organizational impact.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-123.png)Finance AllianceNick Rumball![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--52-.png)](https://www.financealliance.io/how-cfos-power-business-strategy/) --- ## **The power of cross-validation and human review** Fraud detection is largely the product of [machine learning](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/) and automation today. But I’ve come to understand that human oversight is as crucial as ever, if not more so, to catch the emerging or subtle threats that can slip by even our best algorithms. At Meta, we balanced the use of algorithmic flagging with an expert review system. If a user or transaction hit a certain risk threshold, we had a team of specialists on the frontlines, ready at a moment’s notice, to spring into action and investigate. This mixed approach is very good at finding patterns that the algorithms haven’t yet learned. Each time the human team uncovered a new variant of fraud, we could feed that knowledge back into the machine learning model and make it stronger for the next time out. The human analysts also brought something essential that pure data sometimes lacks (especially in edge cases such as the suspicious traffic spikes that turned out to be legitimate promotional campaigns): a real-life understanding of the kind of context that makes all the difference in whether something is a fraud or not. By 2025, as AI advances even further, the balance may shift more toward automation and away from human review, but I doubt it will ever tip completely in the direction of automation. After all, people are much better than algorithms at spotting hard-to-detect errors and at reading the signals that indicate something is amiss. In short, human oversight is crucial to making sure that what we do online is both ethical and fair. ## **Building for future threats: anticipating fraud evolution** One issue that has grown every year is the need to stay one step ahead of fraudsters instead of merely reacting to their latest schemes. During my time building anti-fraud solutions at Yandex and, later, investigating incidents at Meta, I saw just how quickly malicious actors pivot when their old tricks fail. A new policy or anti-fraud measure might barely deter them for a moment, but then they figure out a workaround that leaves you unprepared and blindsided. In contrast, certain firms have created “red teams” that mimic hostile forces and attempt to break into their systems. These would-be hackers are good at thinking like the bad guys and trying to figure out how to use (or misuse) every aspect of the product or policy in question to gain access. Simulating this kind of threat is a good way to identify any gaping holes in your security. By 2025, even more than today, taking these steps is crucial. The rings of AI-fueled fraud have become far too clever, with bots now able to convincingly mimic human behavior and evil masterminds running advanced scripts that coordinate on a disturbingly large scale. To stay ahead of such threats requires not just funding but also a serious commitment to R&D, multidisciplinary cooperation, and a culture in which every assumption about your current defenses is rigorously challenged. --- [CFO cybersecurity: What’s the CFO’s role in cybersecurity?From crunching numbers to combating cyber threats, the role of the CFO has leaped into uncharted territory, making CFO cybersecurity one of the hottest topics in boardrooms across the globe.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-124.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_4_data_protection-1.jpg)](https://www.financealliance.io/cfo-cybersecurity/) --- ## **Measuring what matters: beyond detection rates** For many years, a simple statistic measured the capability and effectiveness of fraud teams: how many fraudulent actions they blocked. But that one statistic alone scratches the surface of examining whether these teams positively impact Meta’s performance or not. You could catch a large volume of fraud, great, but if you also mistakenly block thousands of legitimate users, you might do more harm than good. At Meta, we put holdouts, human review validations, and cross-validation methods to work on refining our evaluations. We then turned these metrics into money, showing leadership the trade-off between blocking fraud and reducing friction. This “monetary coverage” approach helped us see the missed fraud and false positives in concrete financial terms, an aspect that gives these statements your invaluable prioritization. At Meta, we introduced holdouts, human review validations, and cross-validation methods to refine our evaluation. These days, it’s equally vital to gauge your business’s overall impact, user retention, and brand trust along with the more traditional measurement of catch rates and fraud. High-level data might say your false positives are only 2%, but if that 2% includes high-value sellers or brand-new customers, the damage can be disproportionately large. ## **Building trust through transparency** One frequently neglected aspect of combatting fraud is transparency. Our team at Yandex Market, which increased revenue and user engagement during six months of working with that platform, observed how pivotal it was for our users to comprehend some basic details about our security measures. They certainly don’t need to see the nitty-gritty algorithms performing our scam-spotting magic, but they do want some kind of confirmation that we’re protecting them from scams, bad listings, and payment fraud. By clearly conveying overall security measures, without revealing the precise details that bad actors might use to circumvent our safeguards, we built user trust. Even straightforward statements like, “We check every transaction in real time” or “We put merchants through a multi-step verification process before allowing them to sell on our site” go a long way toward assuaging user fears. That will be truer than ever in 2025, when skepticism around data usage and AI decision-making is at an all-time high. --- [Banking on a greener future: Where ESG stands in 2024The environmental, social, and governance (ESG) movement has taken root in the financial sector, with banks increasingly recognizing its significance. But how far have we come, and what challenges remain? Here’s a look at the current landscape of ESG compliance in banking.👇🏻![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-126.png)Finance AllianceBrendan Byrne![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Stock-2.png)](https://www.financealliance.io/banking-on-a-greener-future-where-esg-stands-in-2024-2/) --- ## **Emerging trends for 2025 and beyond** Several trends are taking shape as we advance into 2025, which are affecting the future of fraud detection in online marketplaces. ### Regulatory scrutiny and compliance Globally, governments are focusing more attention on data handling, identity verification, and consumer protection. Companies that are a step ahead aren’t just complying with the bare minimum; they’re doing much better than that. They’re practicing data ethics. These companies see laws like the GDPR (General Data Protection Regulation) or CCPA (California Consumer Privacy Act) as a floor, not a ceiling, for how they handle data. They use these regulations as a guide to treat all of their users fairly, no matter their demographic. ### Decentralized and AI-powered fraud Fraud rings are using machine learning of their own to seek out patterns or weaknesses in the operation of a given fraud scheme, and to do so in ways that allow them to scale. Stopping these clever adversaries requires equal parts sophisticated AI and the 21st-century version of a “discover, defend, and iterate” strategy. ### Cross-platform collaboration Bad actors don’t confine themselves to a single marketplace; they frequently employ the same pilfered credentials or tactics across many venues. In the tech world, working together has become the norm, indeed, the necessity, for both industry giants and smaller platforms. By pooling and analyzing the kind of data that pseudonymous fraudsters would rather not have out in the open, they can all make better, more secure products. ### User empowerment An increasing number of marketplaces now inform users about typical scams, phishing attempts, and social engineering. Using resources such as two-factor authentication prompts or obvious disclaimers made before transactions, platforms try to make sure that users are on the lookout for any funny business. This model sort of spreads the responsibility of detecting fraud between the platforms and the users and reduces the impact that fraud can have. ## **The human element** When I think about the past 10 years, I know for certain that our best weapon against fraud isn’t just technology. Although machine learning and [data analytics](https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/) are key components, and starring roles of sorts, the real fraud-busting line of defense is the human one and, underneath it, the layer of trust we have with our users. At its essence, preventing fraud is about maintaining the relationships that fuel a bustling marketplace. Every time a user registers or finishes a transaction, they take a leap of faith that the platform is on their side. For me, that’s why I come to work every day: to ensure that this trust is well placed. Even as fraud evolves at breathtaking speed, we can watch, adapt, and protect the marketplace experience so that honest participants can engage with confidence. Certainly, the arms race between con artists and defenders will go on, but I’m optimistic. By moving ahead with security and convenience, with threat modeling, with multilayered defenses, and keeping users in the know, we have a chance to create a safer, stronger place for everyone involved. And in the end, it’s not just about stopping the bad guys. It’s about protecting how people connect and trust one another, which is at the heart of any marketplace worth using. --- ### Navigating ASC 606 in the SaaS world: Strategies for MRR and ARR recognition URL: https://www.financealliance.io/navigating-asc-606-in-the-saas-world-strategies-for-mrr-and-arr-recognition/ Last updated: 2025-05-22T12:46:00.000Z I recently implemented an ASC 606 system in an emerging company that needed to move from cash revenue accounting to accrual revenue accounting. Emerging businesses face this issue when they start raising capital and external parties and investors want to see audits. This whole process gets particularly tricky in situations where there is no contracted term to the revenues and the retention half-life of the customers is short, say less than one year. Integrating customer relationship management (CRM) systems with revenue recognition processes can help manage data from various sources such as orders and contracts, ultimately leading to improved compliance and enhanced business processes. A great example of this would be a consumer app company which has high attrition during the trial period, which in itself presents major complications to applying ASC 606, and then gets some payments for a few months and then the clients cancel after a few months. ![ASC 606 in the SaaS World](https://tirabassi.com/wp-content/uploads/2025/03/cfo5.png "ASC 606 in the SaaS World | Tirabassi.com") ## **Understanding revenue recognition** ### **What is revenue recognition?** Revenue recognition is a fundamental concept in accounting that determines when a company can officially record revenue from its transactions. This principle ensures that revenue is recognized in a consistent and transparent manner, aligning with generally accepted accounting principles ([GAAP](https://en.wikipedia.org/wiki/Generally%5FAccepted%5FAccounting%5FPrinciples%5F%28United%5FStates%29)). For SaaS companies, which often deal with complex [subscription models](https://www.financealliance.io/saas-finance-strategies/) and varying payment structures, understanding when to recognize revenue is crucial. It helps these companies accurately report their financial performance, providing a true picture of their economic activities and enabling informed business decisions. --- [How to create a revenue plan that doesn’t fall apart by Q3This blog will walk you through the main components of a revenue plan, what good revenue planning involves, when to start and how to put together a plan that gets results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-113.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4--2.png)](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) --- ## **Importance of revenue recognition in SaaS** In the SaaS world, revenue recognition is not just a regulatory requirement but a cornerstone of financial integrity. SaaS companies typically have diverse revenue streams, including subscription fees, usage-based charges, and one-time payments for services like onboarding or training. Accurate revenue recognition ensures that these companies can properly account for their revenue, reflecting the true financial health of the business. This transparency is vital for maintaining investor confidence and meeting the expectations of stakeholders. Moreover, [compliance](https://www.financealliance.io/finance-and-compliance/) with accounting standards such as ASC 606 and IFRS 15 is mandatory, and proper revenue recognition practices help SaaS companies adhere to these regulations, avoiding potential legal and financial repercussions. ## **Understanding ASC 606 for SaaS and subscription-based models** For SaaS companies, where Monthly Recurring Revenue (MRR) and Annual Recurring Revenue (ARR) form the backbone of financial projections, ASC 606 introduces a paradigm shift in revenue recognition practices. This standard requires revenue to be recognized as performance obligations are fulfilled, not simply when payments are received, fundamentally changing how subscription businesses track and report their financial health. The challenge intensifies for companies with high churn rates or non-contractual revenue streams. When your average customer lifetime might be only four to six months, determining how to properly recognize MRR becomes complex. Should you recognize the full expected lifetime value? Or should you be more conservative given the unpredictability of customer behavior? ## **The five-step model through a SaaS lens** ![5 Step Model through SaaS Lens](https://i0.wp.com/images.surferseo.art/223cc6f0-7917-4ceb-abbb-1f05c4978137.png?ssl=1) When applied to subscription-based businesses, ASC 606’s five-step model requires special consideration at each phase: ### **1\. Identifying customer contracts in the SaaS context** For SaaS businesses, identifying contracts goes beyond formal agreements. Month-to-month subscriptions, freemium models with in-app purchases, and trial-to-paid conversion cycles all present unique challenges. When a customer can cancel at any time without penalty, determining what constitutes a “contract” for ASC 606 purposes requires careful judgment. Evaluating contracts to ensure compliance with new standards is crucial, particularly in disclosing remaining performance obligations. Many SaaS companies track cohort retention curves to establish predictable patterns that can inform their revenue recognition approach. For instance, if historical data shows that 80% of customers who pass the 30-day mark typically remain for at least three months, this pattern may help establish a reasonable basis for revenue recognition. ### **2\. Identifying performance obligations in a subscription model** SaaS offerings typically bundle multiple performance obligations within a single subscription. These might include: - Software access and usage rights - Customer support services - Implementation and onboarding - Training sessions - System upgrades and maintenance For MRR and ARR calculations, determining whether these elements constitute distinct performance obligations dramatically affects when and [how revenue is recognized](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/). A performance obligation must provide distinct value to the customer - a criterion that requires nuanced analysis in integrated SaaS platforms. The revenue recognition standard, as set out by ASC 606 and IFRS 15, provides a uniform framework for recognizing revenue from contracts with customers, addressing fragmented policies across industries, and enhancing the comparability of financial statements. --- [11 SaaS finance strategies for scaling subscription revenueJoin us as we dive headfirst into the world of SaaS finance, helping you to better understand the industry, how it operates, and strategies to help you succeed in your role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-114.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/SaaS-finance-2.jpg)](https://www.financealliance.io/saas-finance-strategies/) --- ### **3\. Determining transaction price with variable MRR** SaaS pricing models often include variable components that complicate transaction price calculations: - Usage-based billing - Tiered pricing structures - Volume discounts - Performance bonuses or penalties - Credits for service outages For companies with usage-based components to their MRR, estimating the transaction price requires statistical analysis of historical usage patterns. This is particularly challenging for early-stage companies with limited historical data. Additionally, under ASC 606 and IFRS 15, it is important to consider significant financing components when determining the transaction price, as they can affect the amount an entity expects to receive when transferring goods or services to a customer. ### **4\. Allocating transaction price across the subscription lifecycle** In the context of MRR and ARR, allocating transaction price involves distributing revenue across the subscription term. For annual contracts with upfront payments, this means recognizing revenue monthly as the service is delivered rather than at the time of payment. The allocation becomes more complex with multi-year deals, escalating pricing tiers, or mid-term upgrades and downgrades that affect MRR calculations. Each scenario requires careful analysis to ensure ARR figures accurately reflect the economic reality of the business. #### **5\. Recognizing revenue based on MRR patterns** The final step is recognizing revenue aligns closely with how SaaS companies track their MRR and ARR metrics. Revenue recognition typically occurs on a ratable basis over the subscription period, reflecting the continuous delivery of service. For subscriptions without fixed terms, companies must establish reasonable estimates for expected customer lifetimes. This often involves analyzing cohort data to determine average subscription durations and churn patterns. If the average customer stays for five months, recognizing revenue beyond this timeframe would be difficult to justify under ASC 606. --- [How AI is transforming financial modeling & sales forecasting in enterprise techThis article explores how AI is transforming financial modeling and sales forecasting (two pillars of enterprise strategy) and helping finance teams shift from reactive to proactive operations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-116.png)Finance AllianceSupreeth Meka![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--51-.png)](https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/) --- ## **MRR and ARR fundamentals** #### **What is monthly recurring revenue (MRR)?** Monthly Recurring Revenue (MRR) is a pivotal metric for SaaS companies, representing the predictable, recurring revenue they can expect to receive from their customers each month. MRR is calculated by multiplying the average revenue per user (ARPU) by the total number of users. This metric is essential for SaaS companies as it provides a clear view of their revenue growth, customer retention, and overall financial health. By tracking MRR, SaaS companies can gauge the stability and scalability of their business model, making it easier to [forecast future revenue](https://www.financealliance.io/how-ai-forecasting-drives-smarter-financial-planning/), plan for growth, and make strategic decisions. ## **Handling common SaaS revenue recognition scenarios** ### **Freemium models and trial periods** Freemium offerings and trial periods present unique challenges under ASC 606\. When does the contract actually begin? At sign-up, or at conversion to paid? How should companies account for the value of services provided during free trials that convert to paid subscriptions? Best practice typically involves recognizing no revenue during genuine free trials, then beginning recognition upon conversion to paid status. However, if the trial includes a credit card authorization that automatically converts to paid unless canceled, the contract likely begins at trial initiation. ### **Expansion MRR and contraction MRR** SaaS companies closely track expansion MRR (revenue from upsells and cross-sells) and contraction MRR (revenue lost from downgrades) as key growth metrics. Under ASC 606, these changes require modification of the original contract and reallocation of transaction prices. When a customer upgrades mid-subscription, the additional MRR is typically recognized over the remaining subscription term. Similarly, downgrades reduce the recognized MRR going forward, potentially requiring adjustments to previously recognized revenue if material. ### **Customer acquisition costs and MRR ratios** ASC 606 permits capitalization of incremental costs of obtaining contracts, which has significant implications for SaaS unit economics. Sales commissions, traditionally expensed immediately, can now be capitalized and amortized over the expected customer lifetime. This alignment with customer lifetime value (LTV) calculations provides a more accurate picture of customer acquisition cost (CAC) to MRR ratios, a critical metric for SaaS investment decisions. To further analyze these metrics, you can use the [**CAC Calculator**](https://cfoproanalytics.com/cac-calculator/) and [**LTV Calculator**](https://cfoproanalytics.com/lcv-calculator/) to gain deeper insights into acquisition costs and customer lifetime value. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-117.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FP-A-career-salary-and-path-2-4.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## **Technology solutions for MRR/ARR recognition under ASC 606** Implementing ASC 606 for complex subscription models requires sophisticated tools that integrate with existing SaaS metrics dashboards. Modern revenue recognition solutions can: - Automatically calculate MRR/ARR based on contract terms - Track performance obligations across subscription lifecycles - Handle complex scenarios like upgrades, downgrades, and cancellations - Generate compliant revenue recognition schedules - Provide auditable documentation of revenue recognition decisions For SaaS companies already tracking detailed MRR metrics, these systems can leverage existing data while adding the layer of accounting rigor required by ASC 606\. Additionally, integrating [customer relationship management](https://en.wikipedia.org/wiki/Customer%5Frelationship%5Fmanagement) (CRM) systems with revenue recognition solutions allows for more effective management of data from various sources such as orders and contracts, ultimately leading to improved compliance and enhanced business processes. ## **Best practices for ASC 606 compliance in SaaS businesses** ### **Harmonizing SaaS metrics with GAAP reporting** SaaS companies typically track operational metrics like MRR, ARR, customer lifetime value (LTV), and churn rates for internal decision-making. Under ASC 606, aligning these metrics with GAAP-compliant revenue recognition creates a more coherent financial story for both management and investors. The Financial Accounting Standards Board (FASB) introduced ASC 606 to transition from industry-specific guidance to a more transparent, industry-neutral standard that enhances comparability of financial statements across different sectors. This alignment requires careful documentation of assumptions about customer behavior, contract durations, and performance obligation satisfaction—particularly for subscriptions without fixed terms. ### **Building robust cohort analysis** For SaaS businesses with high churn, cohort analysis becomes essential for ASC 606 compliance. By tracking retention rates across customer vintages, companies can establish defensible estimates for expected customer lifetimes and corresponding revenue recognition periods. The International Accounting Standards Board (IASB) plays a crucial role in establishing uniform revenue recognition standards under IFRS 15, which ensures consistency and transparency in financial reporting across different industries and regions. These cohort-based estimates should be regularly reassessed as customer behavior evolves, with revenue recognition practices adjusted accordingly. ## **Developing clear policies for MRR and ARR recognition** Consistency is paramount in ASC 606 compliance. SaaS companies should develop clear policies addressing: - How MRR is calculated for different subscription types. - When ARR figures include committed versus projected renewal revenue. - How non-recurring elements are separated from recurring revenue. - Treatment of discounts, credits, and variable components. - Recognition policies for contracts of different durations. These policies should be documented and applied consistently across all customer contracts to withstand audit scrutiny. --- ### How CFOs power business strategy URL: https://www.financealliance.io/how-cfos-power-business-strategy/ Last updated: 2025-10-08T09:08:29.000Z When I got the 4 a.m. phone call, I knew things were serious. I was CFO of the Capital Release Unit at Credit Suisse at the time, and the voice on the other end simply asked, “How quickly can you get to the office?” There were train strikes in the UK, so I grabbed a cab, signed an NDA in the back seat, and began bracing for what I suspected would be one of the most intense periods of my career. What unfolded over the next several days, weeks, and months is, as they say, history. But that moment reinforced a core belief I’ve carried with me for years: as finance leaders, we are more than the keepers of the books. We are strategic partners. Trusted advisors. First responders in a crisis. And if we’re doing our jobs right, we’re central to how businesses create and sustain value. Let’s talk about how we get there and why CFOs must redefine what success looks like in today’s [finance function](https://www.financealliance.io/the-finance-function-of-the-future/). ## The foundation of strategic partnership The role of finance has evolved significantly. Decades ago, it was primarily about processing transactions, [ensuring compliance](https://www.financealliance.io/finance-and-compliance/), and producing reports. Today, it's about influence, foresight, and value creation. But none of that can happen without trust. That trust is earned by doing the basics exceptionally well. Reliable reporting, robust financial controls, timely forecasting, and sound [cash management](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) \- these are non-negotiable. They form the base of what I like to think of as a spiral staircase, you can’t get to the next level without a solid footing on the one below. Once you've built that foundation, you’re no longer just reporting what happened, you’re helping shape what comes next. ## The strategic CFO So what does that “next level” look like? It means shifting from a purely backward-looking stance to one that anticipates, advises, and influences. It means using strategic insight and scenario planning to guide decisions, not just validate them. It means embedding finance into the business, not as a support function, but as a key voice in strategic forums, capable of vetoing decisions that don’t align with long-term goals. To do that effectively, a CFO must be agile, adaptable, and plugged into the broader context: market shifts, regulatory changes, political developments, internal dynamics. The more informed you are, the more value you can bring. _This post is for paying subscribers only._ ### How AI forecasting drives smarter financial planning URL: https://www.financealliance.io/how-ai-forecasting-drives-smarter-financial-planning/ Last updated: 2025-04-16T22:46:51.000Z Volatility is the new normal. For finance leaders, that means the pressure is on to adapt plans fast, minimize risk, and spot opportunities early. But if your FP&A team is buried in manual data work - or flying blind without insight from Sales and Marketing - you’re reacting, not leading. **It’s time to change that.** Join this live session to see how AI-powered forecasting and predictive analytics can help you cut through the noise, plug into powerful early indicators, and shape the future—instead of scrambling to report on it. **Can’t make it live? Register anyway and we’ll send you the recording.** --- ### What you'll learn: - Why **Sales & Marketing data** are essential early indicators FP&A needs to tap into - How to **move faster** by leveraging predictive analytics instead of wrangling raw data - How modern finance teams use AI and integrated data to **reduce risk, adapt plans**, and drive performance—*not just reporting* --- ### The challenges we’ll tackle: **Inability to adapt fast enough** In a volatile world, waiting until next quarter to adjust your plan isn’t an option. Learn how the right tools can help you move at market speed. **Overlooking early indicators** Your GTM teams have the signals. FP&A needs to harness them. We’ll show you how to build that connection—and why it’s your secret weapon. **Stuck in data wrangling** Manually collecting, cleaning, and syncing data wastes valuable time. Discover how AI and automation can free your team to focus on performance. --- ## **Meet the experts** [**Darrell Cox**](https://www.linkedin.com/in/darrell-cox-547a461/) CFO, **Una Software** With over 25 years of leadership experience, Darrell has built and scaled high-performing teams, driving growth and results in early and growth-stage companies. He has played pivotal roles in many companies, including Vena Solutions, FreshBooks, Virgin Mobile, Wind Mobile, and others, shaping their success through strategic leadership and execution. [**Clayton Ramnarine**](https://www.linkedin.com/in/claytonramnarine/) CEO, **Una Software** With over 20 years of experience in the software industry, Clayton has held key roles across professional services, sales, sales leadership, and as a Chief Sales Officer. As both an individual contributor and revenue leader, he has played a pivotal role in scaling successful software companies, including Prophix, Vena Solutions, and PartnerStack. ### How AI is transforming financial modeling & sales forecasting in enterprise tech URL: https://www.financealliance.io/how-ai-is-transforming-financial-modeling-sales-forecasting-in-enterprise-tech/ Last updated: 2025-10-01T11:08:16.000Z AI is emerging as a key differentiator in enterprise finance. As traditional financial models struggle to keep up with the pace of change, enterprise tech organizations are turning to AI to unlock faster, more accurate, and insight-driven decision-making. Drawing from my experience in sales planning and forecasting in the enterprise tech sector, I’ve seen firsthand how AI is reshaping how global enterprises forecast revenue, optimize GTM strategies, and manage P&L risk. This article explores how AI is transforming financial modeling and sales forecasting (two pillars of enterprise strategy) and helping finance teams shift from reactive to proactive operations. ## **1\. Why traditional forecasting falls short** There are three main reasons why traditional forecasting is falling short: ### **Lack of broader business context** [Sales forecasters](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) and financial modelers frequently lack visibility into wider organizational shifts such as changes in product strategy, marketing campaigns, or operational execution that affect demand and performance. This makes it difficult to fine-tune models for niche business dynamics or rapidly changing market conditions. ### **Inflexibility** They often have an inability to account for real-time changes in demand, market shifts, economic conditions, tariffs, or sales performance. ### **Human bias** Over reliance on gut-feel projections leads to inaccurate financial planning. In many enterprise settings, these limitations create friction between planning and execution across business functions, finance, sales, and marketing. Misaligned forecasts result in delayed strategic actions and misused resources, which are issues that AI is now well-positioned to solve. ## **2\. What makes AI a game-changer for financial modeling** ### Cross-functional simulations tailored by domain experts One of AI’s most transformative strengths lies in its ability to empower every function within the enterprise to personalize simulations using their domain-specific expertise. For example: - The pricing team can continuously adjust models based on real-time strategy updates. - The product team can simulate outcomes tied to roadmap changes or launch timing. - The marketing team can incorporate variable [lead generation budgets](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) or campaign performance assumptions. Likewise, GTM leaders can simulate how scaling inside sales headcount could drive more transactional business and enhance margins. These deeply integrated, cross-functional simulations not only improve forecast precision but also drive strategic alignment and execution agility across the business. ### Real-time forecast adjustments Unlike static quarterly models, AI allows finance leaders to refresh forecasts dynamically, giving real-time visibility into revenue performance. This is particularly useful in fast-evolving segments like AI infrastructure, where product cycles and demand signals change rapidly. --- [How to create a revenue plan that doesn’t fall apart by Q3This blog will walk you through the main components of a revenue plan, what good revenue planning involves, when to start and how to put together a plan that gets results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-108.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--4-.png)](https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/) --- ## **3\. Practical use cases in enterprise finance** ### AI-powered lead scoring & targeting Inspired by the Lean Startup's 'Build-Measure-Learn' cycle, one effective AI use case is building a lean, predictive lead scoring model. Organizations can: - Develop an initial AI model based on historical data to identify high-probability buyers. - Continuously refine lead targeting with real-time behavioral and market data. - Deploy a pilot program with a focused sales team to test and validate the model’s effectiveness. - Measure conversion rates, learn from outcomes, and iterate the scoring logic. ## Smart bundling & pricing optimization Following lead scoring, enterprises can create value by applying AI to product bundling and pricing strategies. This includes: - Building AI-driven recommendations for optimal hardware/software bundles based on customer profiles. - Integrating dynamic pricing capabilities that react to competitor behavior and market demand. - Running A/B pricing tests within specific customer segments to evaluate effectiveness. - Collecting feedback from sales teams to iteratively enhance pricing logic and usability. ## Automated revenue forecasting Another valuable use case involves enhancing revenue visibility and predictability. Organizations can: - Better predict conversion rates for large strategic deals and transactional segments, enabling more reliable revenue planning across deal sizes. - Forecast transactional business growth patterns tied to seasonal cycles, marketing triggers, or high-velocity sales channels. - Continuously refine revenue projections by integrating demand signals, channel performance, and seasonality. - Establish feedback loops between finance and GTM teams to adjust models based on real-world performance. --- [15 must-read FP&A books 📚Get ready to add more titles to your TBR (to be read) list as we reveal the 15 best FP&A books to help you excel within your role.👇🏼![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-109.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Stock.png)](https://www.financealliance.io/11-must-read-fp-a-books/) --- ## **4\. How AI enhances execution and GTM strategy** ### Smarter pipeline management AI can streamline pipeline visibility and improve forecast reliability through: - Collaborative pipeline reviews with finance and sales using AI-generated risk scores and close probabilities. - Analysis of competitor dynamics and market share shifts at the product and geo level to understand how winning or losing specific deals affects strategic positioning. - Enhanced understanding of how pipeline outcomes impact both profitability and long-term growth trajectories. ### Improved sales productivity AI boosts front-line efficiency by guiding sales teams to focus efforts on the right product segments expected to experience a surge in demand (such as those driven by OS refresh cycles, [compliance deadlines](https://www.financealliance.io/finance-and-compliance/), or emerging industry triggers), enabling them to strategically capture growth opportunities. AI also helps to prioritize accounts while providing accurate bundling suggestions based on buyer profiles and sales history to increase deal size and win rates. ## Tighter finance-sales alignment AI serves as a bridge between strategic planning and operational execution by: - Providing shared insights to drive collaboration between FP&A, GTM, and sales teams. - Enabling joint decision-making based on real-time financial and sales data. - Improving coordination between business units through unified [performance metrics](https://www.financealliance.io/time-to-value-metric/). - Reducing misalignment and strategic blind spots across planning cycles. ## **5\. Key considerations for implementation** - **Data readiness:** Clean, structured data is critical. Integrating CRM, ERP, and planning systems improves AI effectiveness. - **Human oversight:** AI augments, not replaces, finance leadership. Human intuition is still key for context and judgment. - **Change management:** Teams need training and adoption support to fully leverage AI’s potential. ## **Conclusion** AI is redefining how enterprise tech companies forecast, plan, and execute. From lead targeting to revenue modeling and cross-functional [scenario planning](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/), it brings precision, agility, and alignment to financial operations. By breaking silos and enabling real-time collaboration across finance, GTM, and sales, AI turns forecasting into a growth engine. Companies that embed AI into their processes will be better positioned to anticipate market shifts, improve profitability, and lead with confidence. ***\*Disclaimer: The views expressed in this article are my own and do not reflect the official policy or position of any organization. \**** --- ### The CFO’s guide to revenue planning that doesn’t fall apart by Q3 URL: https://www.financealliance.io/the-cfos-guide-to-revenue-planning-that-doesnt-fall-apart-by-q3/ Last updated: 2025-10-01T11:07:45.000Z ## **What is a revenue plan?** A revenue plan strategizes how a business will generate income over a set period (usually a fiscal year). Don’t confuse a revenue plan with a forecast though, the two are very different. While a forecast tells you what might happen, a revenue plan tells you how you’ll *make* it happen. It’s the plan that connects your company's growth goals with the details or steps of how you'll make it happen. It's a way to link things like your product, pricing, marketing, and sales, etc., all with the main goal of bringing in consistent and increasing income. A solid revenue plan answers three key questions: - Where is revenue coming from? (New business, expansions, renewals, pricing changes, etc.) - What resources are required to hit the target? (Headcount, tools, programs, etc.) - What risks are we betting against and are they worth it? A good revenue plan makes sure everyone is aligned. But a truly great one creates accountability, transparency, and real-time visibility into how the business is performing against the plan, not just around it. This blog will walk you through what good revenue planning involves, when to start and how to put one together that works. --- **Topics covered:** - [How revenue planning works](https://www.financealliance.io/p/ccc92afd-1076-4261-a650-19c64c2e1300/#how-revenue-planning-works) - [Metrics and KPIs](https://www.financealliance.io/p/ccc92afd-1076-4261-a650-19c64c2e1300/#kpis-and-metrics-to-track) - [When to start revenue planning](https://www.financealliance.io/p/ccc92afd-1076-4261-a650-19c64c2e1300/#the-best-time-to-start-revenue-planning) - [How to create an effective revenue plan](https://www.financealliance.io/p/ccc92afd-1076-4261-a650-19c64c2e1300/#how-to-create-an-effective-revenue-plan) - [Common challenges ](https://www.financealliance.io/p/ccc92afd-1076-4261-a650-19c64c2e1300/#challenges-you-might-encounter-with-your-revenue-plan) - [FAQs](https://www.financealliance.io/p/ccc92afd-1076-4261-a650-19c64c2e1300/#faqs-revenue-plans) --- ## **How revenue planning works** The revenue planning process pulls inputs from across the business, not just finance. This is because revenue doesn’t exist in a vacuum. It’s the result of multiple interconnected decisions and assumptions made by various teams. Here’s a simple breakdown of what’s involved in revenue planning: ### **1\. Setting your targets** The best place to start is with a number that’ll be your main target. But where does this number come from? Well, realistic targets should be grounded in historical data, market realities, product capacity, and available resources. ### **2\. Segmentation and source breakdown** Where your revenue comes from matters. Obtaining new business isn't the same as keeping current customers happy or selling them more things. Each renewal, upsell, and cross-sell has a different motion, timeline, and risk profile. Effective revenue plans break these out clearly and lay out specific plans for each. ### **3\. GTM and headcount alignment** If you want more revenue, but don’t want to bother lining up your go-to-market (GTM) strategy and team size, you’re headed for disappointment. You need the right people in the right roles with the right tools. We’re talking about including everyone from sales to marketing, customer success and product teams, etc. – they all need to be in sync. ### **4\. Funnel and conversion assumptions** What are your expected conversion rates? Sales cycles? Average deal sizes? Every assumption should be pressure-tested because your revenue plan is only as strong as the math behind it. So, don’t be afraid to challenge these assumptions. ### **5\. Expense planning** Spoiler alert: revenue doesn’t come for free. Making money costs money, which is a saying you’ve probably heard enough by now. But it still rings true because when it comes to revenue planning, you’ll need to figure out how much you're investing in: - Your team - The technology you use - Training - Marketing efforts If finance and ops aren’t looped in here, expect friction (and missed forecasts) later. ### **6\. Risk assessment and scenario modeling** What happens if a big customer segment doesn't do as well as you hoped? What if you can't hire people fast enough? What if more customers leave than you planned? Smart revenue plans build in some wiggle room by modeling best-case, base-case, and worst-case scenarios. This is to make sure you’re not caught off guard if things don’t go according to plan. --- [Scenario planning: Navigate uncertainty with confidenceLearn about the key benefits of scenario planning and how it can be integrated into strategic and financial planning cycles.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-103.png)Finance AllianceCesar Gomez Nieto![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--2--1-1.png)](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/) --- ## **KPIs and metrics to track** There are a number of possible [metrics](https://www.financealliance.io/time-to-value-metric/) you might want to track to help you manage your revenue plan. While the exact mix will depend on your revenue plan definition (what streams you’re including, how goals are structured, and what your business model looks like), here are the most commonly used ones.: - **Monthly recurring revenue (MRR):** Shows predictable monthly income, crucial for [forecasting](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) consistent revenue streams. - **Annual recurring revenue (ARR):** Tracks predictable yearly income, providing a [bigger picture view of stable revenue](https://www.financealliance.io/10-big-picture-financial-planning-steps/) growth. - **Customer acquisition cost (CAC):** Reveals the expense of gaining a new customer, essential for ensuring profitable growth strategies. - **Average Revenue Per User (ARPU):** Provides the average income generated per customer, important for identifying opportunities to increase revenue from the existing base. - **Customer Lifetime Value (LTV):** Tracks the total revenue expected from a single customer over their relationship, vital for understanding long-term profitability and justifying acquisition costs. - **Retention and churn rates:** Monitors how well you keep customers and the rate at which they leave, critical for understanding revenue leakage and the sustainability of growth. - **Sales velocity:** Quantifies how quickly leads move through the sales pipeline and generate revenue, key for forecasting sales performance and identifying bottlenecks. - **Win rate:** Demonstrates the percentage of sales opportunities that close successfully, essential for realistic [sales forecasting](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) and assessing sales effectiveness. - **Gross margin:** Determines the profitability of your core product or service after deducting direct costs, crucial for understanding the financial viability of your revenue streams. - **Net promoter score (NPS):** Measures customer loyalty and advocacy, a leading indicator of the potential for referrals and long-term retention, indirectly impacting future revenue. - **Ramp time for new hires:** Estimates how long it takes new sales or customer-facing hires to become fully productive, important for forecasting the impact of new team members on revenue generation. - **Expansion revenue rate:** Tracks the revenue growth from existing customers through upsells and cross-sells, crucial for understanding the potential to increase revenue from your current customer base. --- [How to create a budget allocation plan for a companyBudget allocation is the process of dividing your company’s financial resources between departments. As you can imagine, it can be a tricky process to get right. Everyone wants a bigger piece of the pie, and you can’t always please everyone.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-104.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--7-.png)](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) --- ## **The best time to start revenue planning** Short answer: *sooner than you think.* Most teams begin three to six months before the new fiscal year kicks off. Waiting until the quarter ends to sketch out next year’s revenue plan is a fast track to reactive decisions and shaky assumptions. But remember, revenue planning isn’t a one-and-done thing. It’s an ongoing process. You’ll know it’s time to revisit your revenue plan when you spot these types of signals: - Sales velocity is tanking or spiking - Churn is creeping up - Hiring is behind (or ahead) of pace - A new market or product is coming online - Leadership is making big bets without updated models Smart CFOs treat the revenue plan like a living document - anchored annually, reviewed quarterly, and adjusted as needed. ## **How to create an effective revenue plan** An effective revenue plan is a cross-functional effort grounded in data, aligned with strategy, and flexible enough to change when needed. Here’s how to create one: ### **1\. Start with the end goal** What’s the revenue number? Let’s say your company wants to reach $50M in ARR next year. Now, you need to reverse-engineer that number and break it down by source. For example, $30M from renewals, $12M from new business, and $8M from upsells. And here’s where math meets strategy. Say your average new logo (aka a brand-new customer) brings in $60K in annual contract value (ACV). That means you’ll need 200 new deals to hit your $12M new business goal. Simple division, sure, but now you’re not just throwing out targets. You’re building from actual, testable assumptions. ### **2\. Pressure-test your assumptions** Finance and GTM need to get aligned on things like average deal size, win rates, ramp time, and churn. Every input should be backed by historical data or a clear rationale. Looking at [historical data](https://www.financealliance.io/data-cleaning-techniques/) to spot trends and patterns in your company’s revenue streams is a very important step. Once you’ve done this, take time to segment the data by key segments like customer type, industry, or acquisition channel. This will give you a much clearer picture of what's driving your revenue and where the biggest opportunities (and risks) lie. ### **3\. Build the model, not just the forecast** Your revenue plan should be dynamic. So, begin by identifying your key revenue levers: What actions or factors have the biggest impact on your revenue (e.g., marketing spend, sales hiring, pricing)? Then, try to estimate how much moving each lever could change your results. For example, if deal velocity improves by 10%, what's the potential uplift? [Scenario modeling](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/) isn't optional, it's essential for understanding these possibilities. ### **4\. Understand the market** Revenue planning without market context is a fast track to bad bets. Study industry trends, shifts in customer behavior, competitive plays, and macroeconomic signals. Don’t just focus on your direct competitors. Sometimes, disruption comes from the blind spot, not the usual suspects. ### **5\. Realistic forecasts** To forecast effectively, ground your predictions in data. Leverage trend analysis, your current run rate, and a deep dive into your sales pipeline. However, don't settle on a single projection. Develop a range of scenarios: optimistic, pessimistic, and most probable. This built-in flexibility helps you to adapt swiftly when reality throws you a curveball. --- [How to create a CFO mission and vision statementIn this blog post, we shed some light on how an established vision can drive success for your company. We’ll also share some CFO mission and vision statement examples and teach you how to create one of your own.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-105.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/CFO-Mission-header-image-2.jpg)](https://www.financealliance.io/cfo-mission/) --- ### **6\. Match resources to ambition** Big targets require smart investment. Reallocate headcount, marketing dollars, and incentives to match the segments or products with the biggest upside. If one product line consistently delivers high margins but is under-supported? Time to double down. ### **7\. Build a tactical action plan** Now it’s execution time. How will you actually hit those revenue targets? This is where you map out the concrete steps: will you adjust pricing? Run specific marketing campaigns? Equip your sales team with new tools. Ramp up partnerships? For each revenue segment, create a simple playbook that clearly links your forecast. ### **8\. Involve every stakeholder** Revenue is everyone’s responsibility. Finance, sales, marketing, CS, and product - all of them play a role in shaping the plan and executing it. So, get everyone in the loop now. This cross-functional teamwork at the beginning stops the "that's not my job" arguments later. ### **9\. Identify and prepare for risk** Don't wait for trouble to strike – anticipate it. What are the potential risks to your revenue? A downturn in the economy? Hiring delays? A competitor's aggressive pricing? For each identified risk, [develop specific contingency plans](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/). This proactive approach means you won't be scrambling if things go sideways. A robust plan understands its vulnerabilities and has solutions in place for each. ### **10\. Track what matters** Once the revenue plan is in motion, keep your eyes on the right metrics: CAC, ARPU, pipeline coverage, retention, rep productivity - whatever reflects your model. Use those KPIs to flag what’s working, what’s drifting, and when it’s time to adjust. --- [Crisis Management Plan vs Business Continuity PlanBelieve it or not, a crisis management plan is not the same as a business continuity plan. The two are similar in many ways, sure, but they have key differences that set them apart.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-106.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Stock--4--2.png)](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) --- ## **Challenges you might encounter with your revenue plan** Even the best revenue plans can hit some bumps. Markets change, our initial guesses might be off, and sometimes teams aren't quite on the same page. But don’t worry, it’s not about creating a perfect plan that avoids every single problem. It’s more important to build a revenue plan that’s solid enough to handle issues when they pop up. So, here are some common challenges that you might face: ### **1\. Teams that aren’t aligned** We've all seen it: finance crunches the numbers, sales just nods along, marketing promises a flood of leads – and then, a few months later, everyone's pointing fingers about why things aren't working. The fix? Get everyone together (even if it's virtually) right from the start. Revenue planning is a team effort and the associated departments all have a stake in hitting that revenue number. ****Remember:** Don't just agree on the goal; make sure everyone understands how you're planning to get there. ### **2\. Being way too optimistic with your assumptions** Looking on the bright side is great and it can be tempting to make the numbers look amazing. However, wishful thinking isn't a strategy and often leads to disappointment. You’ll do much better if you base your revenue plan on actual data. Look at your past performance, and your real conversion rates, and play out different scenarios. ### **3\. Nobody knows who's responsible for what** A solid revenue plan clearly says what needs to be done, who's doing it, and by when. Too many plans fail because nobody knows who's in charge of pulling which levers. Clearly assign ownership across all the relevant teams and set up regular check-ins to see how everyone's doing against their targets. ### **4\. Having a plan that can't bend when things change** We're not living in a world where things stay the same. The economy can shift, customer habits can change, and competitors can make unexpected moves – all in the middle of the year. If your plan is rigid, it's going to break. Build in that scenario planning we talked about. Look at your numbers every quarter and be ready to adjust. Being able to adapt quickly gives you a real advantage. ### **5\. Not keeping an eye on the early warning signs** By the time you see you've missed your revenue targets on the official [financial reports](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/), it's often too late to do much about it. You need to watch for the early clues. How full is your sales pipeline? How quickly are deals moving? Are customers showing signs of leaving? How active are your salespeople? Set up your dashboards to track what predicts your performance, not just what tells you what already happened. ### **6\. Putting resources in the wrong places** You can't focus on everything at once. If you're not putting your money and effort into the things that will drive the most revenue, you'll end up wasting resources and missing your goals. Regularly look at the return on investment for each product, sales channel, and marketing campaign. Shift your spending towards what's delivering results, not just what you've been doing for a long time. --- ## FAQs: Revenue plans #### ****What is the difference between sales planning and revenue planning?** Sales planning is all about how you’ll sell such as targets, tactics, and team execution. Revenue planning, on the other hand, zooms out to look at the bigger picture. For example, where total income will come from (not just sales), across products, services, pricing, and growth strategies. #### ****What is planned revenue?** Planned revenue is your best estimate of how much money your business expects to bring in over a certain period based on sales goals, pricing, market trends, and historical data. #### ****How to calculate a revenue plan?** To calculate a revenue plan, it’s best to start with your expected sales volume, multiply it by your pricing, then layer in other income sources (like subscriptions, services, etc.). Adjust for seasonality, market shifts, and any changes in your offerings. #### ****What is the goal of revenue analysis?** The goal of revenue analysis is to understand how you're actually making money. So, figure out what’s working, what’s not, and where the biggest opportunities or risks are. It helps you make smarter decisions to hit or exceed your revenue goals. #### ****What is the revenue plan definition?** A revenue plan is a roadmap that outlines how a business expects to generate income over time. It connects your financial goals with strategies to achieve them (through pricing, sales, marketing, and growth). --- ## **Join the Finance Alliance Insider Membership** **Join the Finance Alliance Insider Membership**, a curated community and resource hub built for high-performance finance leaders like you. You’ll get exclusive access to expert-led content, proven frameworks, real-world case studies, and behind-the-scenes strategies from CFOs and finance pros who’ve *been there, done that.* It’s not fluff. It’s not theory. It’s tactical insight you can use *now* (and did we mention it’s 100% free, forever?). 👉 [**Become an Insider**](https://www.financealliance.io/insider-membership-plan/) and take your revenue planning (and your entire finance strategy) to the next level. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_3.png) ](https://www.financealliance.io/insider-membership-plan/) ### From transactions to insights: The role of cloud-powered analytics in redefining E-commerce finance URL: https://www.financealliance.io/from-transactions-to-insights-the-role-of-cloud-powered-analytics-in-redefining-e-commerce-finance/ Last updated: 2026-01-28T16:44:20.000Z The shift from traditional offline commerce to e-commerce has been remarkable, with cloud powered analytics leading the transformation of financial functions as cloud enabled services have powered analytics. These analytics are defined as the use of cloud based resources like data storage, processing units, and analytic services to manage and analyze significant data sets. This is especially important for e-commerce finance because analyzing transaction data, sales figures, customer interactions, and other monetary values offers unparalleled insight into cost reduction opportunities, growth prospects, and key strategic moves. Cloud technology powered analytics offer unparalleled flexibility, cost savings, scalability, and accessibility. The aforementioned benefits and attributes allow e-commerce firms to enhance real-time data analytics and significantly alter financial functions. --- ### Main takeaways - **Studies indicate that cloud-centered analytics improve cost management and decision-making capabilities in e-commerce finance activities, having a positive impact on cost-effectiveness.** - **Case studies show that insights drawn from real-time data lead to improvement in financial strategies accompanied by notable cost reductions.** - **The examples indicate higher revenue being generated from individualized customer interactions made possible through the use of cloud analytics.** --- ## Main benefits for E-commerce finance E-commerce businesses are provided with [economical advantages](https://www.financealliance.io/what-is-economic-analysis-the-question-every-cfo-should-be-asking/) through cloud-based services including, better business decisions, experience with the customers, and [compliance with regulations](https://www.financealliance.io/finance-and-compliance/). Reports and case studies highlight how problem corporations have used cloud based analytics to boost finances. ### **Cost savings** Analytical cloud services give a company the opportunity to save money on spending by significantly reducing the costs associated with infrastructure and operations. Traditional building data centers has a huge upfront cost in hardware, maintenance and personnel which is very expensive. Unlike the cloud, its infrastructure does not run on a pay-as-you-go model. Businesses spend on computing power and storage only when absolutely necessary. This becomes particularly useful during holiday seasons like "**Black Friday**" shopping, when the demand for resources increases rapidly and extra support has to be hired. A [study conducted by IDC ](https://www.idc.com/getdoc.jsp?containerId=TEA003562)showcases companies that rely on cloud-managed analytics have a more efficient approach towards data management with much lower platform expense. This is because [data is consolidated](https://www.financealliance.io/data-cleaning-techniques/) and stored across multiple business functions so redundant processes are eliminated. Cloud service providers as well allow the business to scale their computing resources based on actual demand therefore saving the business extra expenses. ### **Making better choices** The right use of e-commerce using the internet and data drives profit. Using cloud systems enables businesses to manage large amounts of data in real time which makes [forecasting](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/), pricing, and inventory management precise. As an example, dynamic pricing ensures that companies are able to capture value out of their competitors by analyzing customer behavior trends. Additionally, companies can real time analyze sales data helping them prevent overstocking or stock outs which has a huge impact on overall revenue. Furthermore, marketing teams can use predictive analytics to perform better by identifying target customers using efficient channels. A [report by McKinsey](https://www.mckinsey.com/~/media/mckinsey/dotcom/client%5Fservice/Marketing%20and%20Sales/Our%20Insights/Big%20data%20analytics%20and%20the%20future%20of%20marketing%20and%20sales/Big-Data-eBook.ashx) indicated that **15% to 25%** revenue growth is achievable with personalization and targeted efforts due to analytics implementation. This empowers e-commerce businesses with cloud analytics systems to conduct A/B testing on pricing, promotional offers, and customer engagement efforts to ensure optimal financial returns. --- [15 must-read FP&A books 📚Get ready to add more titles to your TBR (to be read) list as we reveal the 15 best FP&A books to help you excel within your role.👇🏼![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-102.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FP-A-books.png)](https://www.financealliance.io/11-must-read-fp-a-books/) --- ### **Enhanced customer experience** A business’s revenue is certainly affected by customer experience and analytics powered by the cloud surely help e-commerce businesses interact with their clients on a more personal level. Modern AI systems like recommendation engines can suggest products that customers are likely to buy based on their browsing, purchase history, and preferences which increases the chances of purchase and helps in retaining those customers. As an example, a sizable percentage of sales on Amazon are attributed to its sophisticated cloud powered recommendation engine. Other businesses, such as the ones [analyzed](https://www.mckinsey.com/~/media/mckinsey/dotcom/client%5Fservice/Marketing%20and%20Sales/Our%20Insights/Big%20data%20analytics%20and%20the%20future%20of%20marketing%20and%20sales/Big-Data-eBook.ashx) by McKinsey, that use data analytics to tailor customer journeys have seen revenue increases between 5 to 15%. Cloud-powered customer segmentation also enables targeted marketing campaigns. Through the identification and segmentation of high-value customers, e-commerce systems can tailor deals and cross- and up-sell loyalty incentives to aid in marketing focus on better customer retention and retention lifetime value metrics. Moreover, improvements in overall satisfaction are seen when issues are solved immediately through the hands of AI powered chatbots and virtual assistants. ### Compliance with regulations Keeping up with commerce regulations is crucial for e-businesses, especially when it comes to global taxation or consumer data protection laws. Compliance requirements and [security features](https://www.financealliance.io/cfo-cybersecurity/) are built into cloud platforms so that companies do not have to spend a lot on meeting regulatory requirements. For example, cloud providers guard stored data and offer encrypted storage, role-based access, and automated compliance reporting which guards against CCPA and GDPR legal data protection requirements. This is helpful in reducing the operational and legal risks that come with the sensitive financial data. Financial auditing and reporting are further simplified through cloud-based solutions. Monitoring financial records in real-time and tracking data automatically guarantees accuracy and transparency, which minimizes the possibility of errors that could incur regulatory fines. ## **Detailed case studies with open stats and numbers** To illustrate the impact, we analyze two case studies: Zalando and Etsy, both of which have leveraged cloud-based analytics to enhance their e-commerce finance operations. ### **Case study 1: Zalando** **Company overview:** Zalando is a leading European online fashion retailer, handling over 500,000 products from 2,500 brands across 17 countries, with 31 million active customers as of recent reports. **Implementation:** Zalando migrated to Google Cloud Platform, utilizing BigQuery for data warehousing and Looker Studio for dashboards. They integrated with Google Analytics 360 Suite for comprehensive data analysis, handling tens of billions of Google Analytics hits monthly. **Financial benefits:** - Reduced the cost of obtaining business insights by 30% through optimized data management and reduced administrative overhead, as reported in their case study ([Zalando Case Study on Google Cloud](https://cloud.google.com/customers/zalando)). - Efficiency gains included same-day A/B testing results, reducing time-consuming analysis, which likely lowered operational costs and improved financial decision-making. - The scalability of cloud solutions allowed Zalando to manage large data volumes without extensive on-site infrastructure, further contributing to cost savings. ### **Case study 2: Etsy** **Company overview:** Etsy is a global marketplace for unique and creative goods, with a focus on handmade and vintage items, serving millions of buyers and sellers worldwide. **Implementation:** Etsy completed its migration to Google Cloud in February 2020, moving 5.5 petabytes of data. They utilized BigQuery for analytics and Google Cloud Storage for data management, shifting 15% of their engineering headcount from system infrastructure to customer experience focus. **Financial benefits:** - Doubled the number of experiments, including those in AI and data analytics, which likely led to innovations boosting revenue, as faster feature deployment improved marketplace functionality ([Etsy Case Study on Google Cloud](https://cloud.google.com/customers/etsy)). - Achieved over 50% savings in compute energy, reducing operational costs and environmental impact, which could translate to financial savings in energy expenses. - The shift in engineering focus to customer experience likely enhanced customer satisfaction, potentially increasing sales and revenue, though exact figures on revenue uplift were not specified. --- [Are you prepared to navigate the intricacies of an M&A?David Yates, CFO at Gresham, takes you on a journey through the intricacies of an M&A so you can unlock the best returns for your organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-101.png)Finance AllianceDavid Yates![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--48--1.png)](https://www.financealliance.io/are-you-prepared-to-navigate-the-intricacies-of-an-m-a/) --- ## **Analysis of case studies** ### **Zalando's 30% cost reduction** This significant reduction in the cost of obtaining business insights highlights how cloud analytics can streamline financial operations, making data-driven decisions more cost-effective. The efficiency in A/B testing and data integration suggests improved resource allocation, directly impacting the bottom line. ### **Etsy's operational shift** The 15% shift in engineering focus and doubled experiments indicate a strategic move towards innovation, likely leading to increased revenue through enhanced customer experiences. The 50% energy savings, while primarily environmental, also suggest cost efficiencies that could bolster [financial performance](https://www.financealliance.io/flexible-budget-performance-report/). These case studies demonstrate that cloud-powered analytics not only reduce costs but also enhance revenue potential through better customer engagement and operational efficiency. ## Challenges and considerations The challenges of bringing on cloud-based analytics outweigh the benefits which include: - **Data security:** Increased security regarding data protection is vital with cloud storages, specifically financial data. Security and compliance to regulations like GDPR are necessary. - **Integration complexity:** The integration of pre-existing systems with modern analytics cloud systems can be advanced, requiring a great deal of technical skills and might halt business in the initial phases. - **Skill set requirements:** Businesses must possess or develop skills on data analytics and cloud technologies which raises the overall costs. Every business has different requirements and capabilities which is why selecting a cloud platform like Alibaba Cloud, AWS, or Google Cloud is an individual decision. It is important to consider the cost, flexibility, regrowth and ease of merging with other systems. ## **Conclusion** Analytics powered by the cloud redefine e-commerce finance by providing scalable, flexible, and economically viable options for data storage and analytics. Zalando and Etsy serve as case study examples, demonstrating significant cost savings, smarter decision-making, enhanced customer experience, and other factors critical to financial performance in e-commerce. A business adopting such technologies to remain competitive and foster growth would be in a favorable position. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_6.png) ](https://events.financealliance.io/) ### 15 must-read FP&A books 📚 URL: https://www.financealliance.io/11-must-read-fp-a-books/ Last updated: 2026-01-28T16:45:36.000Z > *"Today a reader, tomorrow a leader." – Margaret Fuller* The best finance professionals are passionate learners. Their pursuit for knowledge is endless, diving deep into courses, webinars, thought-leadership events, and of course, making their way through an ever-growing collection of books. 📚 But what are the **best books on FP&A** that genuinely resonate with the industry's finest? Get ready to add more titles to your TBR (to be read) list as we reveal the 15 best FP&A books to help you excel within your role.👇🏼 ## **15 must-read FP&A books** ### 1\. *Financial Planning & Analysis and Performance Management* by Jack Alexander ### ![FP&A books Financial Planning & Analysis and Performance Management by Jack Alexander](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-1.png) Jack Alexander's [*Financial Planning & Analysis and Performance Management*](https://amzn.to/47EhyJ9) is noted as being an ‘*essential desk reference*’ for FP&A professionals and [CFOs](https://www.financealliance.io/12-of-the-best-cfo-books-to-help-you-succeed-in-2023/) alike. This comprehensive guide dives deep into essential FP&A facets: from budgeting and forecasting to effective financial communication and metrics. Drawing from his rich experience, Alexander offers practical analytical techniques with real-world applicability. Enriched with visual aids, the book provides novel approaches for analysts keen on refining their craft. Whether you aim to revolutionize forecasting, enhance analytical tools, or make astute capital decisions, this book offers invaluable insights. As a bonus, purchasers gain access to an exclusive website packed with helpful tools. A must-have for those serious about mastering FP&A. [Grab your copy](https://amzn.to/47EhyJ9) --- ### 2\. *Financial Forecasting, Analysis, and Modelling: A Framework for Long-Term Forecasting* by Michael Samonas ### ![Financial Forecasting, Analysis, and Modelling: A Framework for Long-Term Forecasting](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-2.png) If you’re looking for a hands-on toolkit focused on long-term forecasting with an emphasis on uncertainty – you’ve found it. Among the recommended FP&A books, [*Financial Forecasting, Analysis, and Modelling: A Framework for Long-Term Forecasting*](https://amzn.to/3QO5izy) stands out. It provides a practical approach to enhancing financial statement simulation models, coupled with techniques to bolster a robust planning process. Complementing the core content, an accompanying website offers a customizable operational model, turning insights into actionable strategies. Dive deep into Excel's capabilities, including [sensitivity analysis](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/), and Monte Carlo Simulation. For those aiming for precision in their financial endeavors, this book is a *must-read*. [Grab your copy](https://amzn.to/3QO5izy) --- ### 3\. *All About FP&A* by Asif Masani ### ![FP&A books - All About FP&A](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-3.png) This book serves as an accessible introduction to fundamental concepts within Financial Planning and Analysis (FP&A). Authored by Asif Masani, an experienced FP&A professional (and regular author here at Finance Alliance), it aims to present these concepts in a clear and understandable manner. The intended audience includes individuals new to finance who are exploring FP&A as a career path, professionals recently entering FP&A roles who may lack formal training in this specific area, and mid-career professionals from fields such as accounting or audit seeking a transition into FP&A. With his years of experience in FP&A across different industries, the author really knows his stuff and wants to share that knowledge. This book is designed to help anyone new to FP&A get up to speed quickly, giving you a solid grasp of the basics. [Buy the book on Amazon](https://www.amazon.com/All-About-FP-ASIF-MASANI-ebook/dp/B0BPZN4P2B) --- ### 4\. *Future Ready: How to Master Business Forecasting* by Dr Steve Morlidge ### ![best fp&a books Future Ready](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-4.png) [*Future Ready*](https://amzn.to/3QKFcxB) dives deep into the forecasting process, addressing the flaws made evident by recent financial crises. Dr. Morlidge combines insights from multiple disciplines and extensive practical experience to offer actionable strategies for refining forecasting in any organization. He theorizes that while predicting the future is impossible, being prepared for it is *not*. The book answers pivotal questions on forecast accuracy, frequency, content, production methods, reliability, and more. With a focus on avoiding data manipulation and understanding risk, *Future Ready* serves as both a practical guide for managers and an enlightening resource for leaders aiming for proactive, informed decision-making in an uncertain world. > "In the area of Forecasting, it is the best book in the market." - ―Fritz Roemer. Leader of Enterprise Performance Executive Advisory Program, the Hackett Group [Grab your copy](https://amzn.to/3QKFcxB) --- ### 5\. *Painting with Numbers: Presenting Financials and Other Numbers So People Will Understand You* by Randall Bolten ### ![FP&A booksPainting with Numbers: Presenting Financials and Other Numbers So People Will Understand You](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-5.png) Navigating the maze of numerical data can be daunting, especially when trying to convey complex ideas in a limited amount of time. [Painting with Numbers](https://amzn.to/3OCTPjC) by Randall Bolten is the guide every professional needs to communicate numerical information seamlessly and effectively. Bolten emphasizes the power of the Arabic numeral system, visual effects, and layout to create compelling presentations. For those aiming to dive deep into FP&A books, Bolten’s work offers insights into audience perception, enhancing your professional image by presenting numbers in a manner that underscores your grasp of underlying business concepts. With a focus on the efficient use of tools like [Excel](https://www.financealliance.io/chatgpt-for-excel/), PowerPoint, and graphs, Bolten, drawing from his extensive experience in finance, provides a treasure trove of techniques and guidelines for clear, engaging, and effective presentations. [Grab your copy](https://amzn.to/3OCTPjC) --- ### 6\. *Financial Analysis, Planning, and Forecasting: Theory and Application* (Third Edition) by Cheng F. Lee and John Lee ### ![ Financial Analysis, Planning, and Forecasting: Theory and Application - FP&A books to read](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/FA_Sharing_Article_Images_Text_Only_--2---1-.png) Diving into the world of corporate analysis and planning, this introduction-level [book](https://www.amazon.co.uk/Financial-Analysis-Planning-Forecasting-Application/dp/9814723843) by Cheng F. Lee and John Lee offers a comprehensive blend of theory and practice. Structured in five pivotal areas, from [financial analysis methodologies](https://www.financealliance.io/what-is-financial-planning-and-analysis/) to intricate financial planning and forecasting, the text introduces readers to classic corporate finance theories, including Pre-M&M Theory, M&M Theory, CAPM, and Option Pricing Theory. The interplay between these theories is meticulously discussed, with real-world examples amplifying the learning experience. The third edition brings fresh perspectives with updated data, expanded topics, and new chapters, ensuring readers have a holistic grasp of financial management decisions, underpinned by interdisciplinary insights. [Grab your copy](https://www.amazon.co.uk/Financial-Analysis-Planning-Forecasting-Application/dp/9814723843) --- ### 7\. ***Winning The Room: Creating and Delivering an Effective Data-Driven Presentation* by Bill Franks** ### ![FP&A books winning the room](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-7.png) > *Revolutionize your data-driven presentations with this simple and actionable guide* If you're an FP&A pro who ever has to present budgets, forecasts, or any kind of financial data to managers or execs, this book will help make sure your message is crystal clear, has a real impact, and helps you get your point across effectively. Written by a data science expert, its advice is broadly applicable to anyone presenting data. But what stands out the most about this book is its actionable tips and strategies to avoid common presentation pitfalls, create effective and memorable visuals, and significantly improve clarity and impact. [Buy the book](https://www.amazon.com/Winning-Room-Delivering-Data-Driven-Presentation-ebook/dp/B09T93WN5Y/ref=sr%5F1%5F2?crid=2R5O2GYP8LQ9T&dib=eyJ2IjoiMSJ9.sXDt6UjECxIJrBC7N5Bn5VCcX5jVeGDCNggFxUdqrtMBpil%5FB-EG20BufdLoO0Boqth0WmvpiEgLaRq6%5Fmd3tDVDpCt5DuyDAWcao3WTCIqjAsJkNDNY%5Frg74BIVAlZppKE3FDe7YETpP6rMiAyS3t9c14vQ6mvyrgU7gGBYrgqfmCvVsraymHqy9v7imQgpPsEkI1k3fBgbRJgbvFc8nctWrw8JAME1AJuf-GnBHZs.ojoG1%5Fjsb2AT1E5z6m6Z1qO36vovhqOpEZolsGUBKTw&dib%5Ftag=se&keywords=winning+the+room&qid=1743159593&s=digital-text&sprefix=winning+the+roo%2Cdigital-text%2C209&sr=1-2) --- ### 8\. *Corporate Financial Analysis: Simple Methods and Strategies to Financial Analysis Mastering* by Blaine Robertson ### ![books for FP&A pros: Corporate Financial Analysis](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-8.png) At the heart of every thriving business or savvy investor lies a common tool: corporate financial analysis. In his [book](https://www.amazon.sg/Corporate-Financial-Analysis-Strategies-Mastering/dp/1661314686), Blaine Robertson demystifies this crucial discipline, revealing how successful figures like Warren Buffet discern companies destined for prosperity. Despite the complexity that high-level financial analysis often brings, Robertson assures readers that mastering the basics is within reach. Drawing parallels to the risks of impulsive decisions, he emphasizes the importance of looking beyond superficial indicators. This guide not only provides foundational principles but also offers hands-on exercises, ensuring readers can apply their knowledge in real-world scenarios. For those on the hunt for the *best* FP&A books, make sure you don’t miss this one! [Grab your copy](https://www.amazon.sg/Corporate-Financial-Analysis-Strategies-Mastering/dp/1661314686) --- ### 9\. *The Audacious Finance Partner: Reveals The Key Factors and Skills for Business Partnering Success* by Andrew Codd ### ![The Audacious Finance Partner](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-9.png) [*The Audacious Finance Partner: Reveals The Key Factors and Skills for Business Partnering*](https://amzn.to/3KS77rs) offers a roadmap to not just measure success, but to actively influence and contribute to it. The story unfolds through the eyes of a finance individual seeking more than just conventional methods. As he explores mentorship from accomplished finance partners across various industries, readers are treated to invaluable, real-life conversations about soft skills that often go unnoticed in formal education but are crucial in today's dynamic business landscape. Whether you're a budding accountant, a finance veteran, or an executive trying to grasp the essence of [finance business partnering](https://www.financealliance.io/finance-business-partnering-playbook-2/), this book serves as a guide to bridging the gap between mere data analysis and impactful influence. [Grab your copy](https://amzn.to/3KS77rs) --- ### 10\. *Using Excel for Business Analysis: A Guide to Financial Modelling Fundamentals* by Danielle Stein Fairhurst ### ![Using Excel for Business Analysis: A Guide to Financial Modelling Fundamentals ](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-10.png) Fairhurst's [guide](https://amzn.to/3QPbzvc) is described as a “*clear, concise, and easy-to-use guide to financial modelling suitable for practitioners at every level*”. And it’s not just about numbers; it's about [harnessing Excel's power](https://www.financealliance.io/how-to-use-python-in-excel/) to craft compelling business stories. With hands-on exercises, real-world case studies, and invaluable online resources, this book takes you from understanding Excel's hidden gems to mastering strategies that keep errors at bay. It outlines skills you’ll need to become a better financial modeler, along with strategies such as linking, formula consistency, formatting, and labeling. With help from this handy book, you’ll soon become an Excel maestro and let your financial models do the talking. [Grab your copy](https://amzn.to/3QPbzvc) --- ### 11\. *Mastering Financial Modelling in Microsoft Excel: A practitioner's guide to applied corporate finance* by Alastair Day ### ![Mastering Financial Modelling in Microsoft Excel](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-11.png) Step into the world where numbers meet strategy. [*Mastering Financial Modelling in Microsoft Excel: A practitioner's guide to applied corporate finance*](https://amzn.to/3OHL5Jf) by Alastair Day isn't just another manual on Excel but a journey into the heart of informed decision-making. In an era where every significant choice can be backed by data, Day unveils the art and science behind robust financial models. Dive beyond basic spreadsheets and unlock advanced analysis tools even if you aren't a coding expert. For enthusiasts who regularly refer to FP&A books, this guide stands out as a top recommendation. This guide is your gateway to transforming Excel from a mere tool to a powerful ally in corporate finance. Accompanied by real-world examples, exercises, and ready-to-use templates, this is the resource that bridges the gap between decision-making aspirations and tangible financial expertise. Part of the acclaimed Mastering Series, this book ensures that you're not just crunching numbers, but truly mastering them. [Grab your copy](https://amzn.to/3OHL5Jf) --- ### **12**. ***Budgeting Basics and Beyond* by Jae K. Shim, Joel G. Siegel and Allison I. Shim** ### ![Budgeting Basics and Beyond](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-12.png) FP&A professionals are always working on company budgets, so it helps to have a book on the subject! This one is very thorough, covering everything from rolling budgets to activity-based budgeting, life-cycle budgeting, and more. It promises to equip you with “an all-in-one resource guaranteed to make the budgeting process easier, less stressful, and more effective.” Budgeting Basics and Beyond is known as a practical and up-to-date guide to budgeting, planning, and control for both financial and non-financial managers. For FP&A professionals, it's valuable because it emphasizes real-world application through examples and solutions, enhances financial modeling skills (including "what-if" analysis and capital budgeting), addresses key FP&A processes, and serves as a comprehensive reference for tackling various financial challenges. [Grab the book](https://www.amazon.com/Budgeting-Basics-Beyond-Wiley-Corporate-ebook/dp/B005RBA9SU/ref=sr%5F1%5F1?crid=DX78FPACRMG2&dib=eyJ2IjoiMSJ9.V38kPTy8NpP00UCQkYYdwa7fdYuEc9eti6jH64skKDJn9zZa45LIjSmUVT8A18T04D779oFSjmNUIJvQ7rWS23p6B-ki4ykRl9SYR8qVBqPDYmVnHiNVS0RBNttNT5LJja4hgWxz4kXG4xE4jCe4NXSKxxOiQaqN2GYuOixsMWo0tigZwOKV1m5RLZlrALZ69XRQJKMZmbJAGbEqOSAdOaBVH1KVGsuvg-RY2P7cFjo.2zhPGA1bxBFLnyCUA7UHc%5FBUCX71DZ2smruUlO%5Ftj4I&dib%5Ftag=se&keywords=Budgeting+Basics+and+Beyond&qid=1743159708&s=digital-text&sprefix=budgeting+basics+and+beyond%2Cdigital-text%2C328&sr=1-1) --- ### 13. *Financial Modeling in Excel For Dummies* by Danielle Stein Fairhurst ### ![Financial Modeling in Excel For Dummies](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-13.png) Forget about specialized software or pricey consultants. Stein Fairhurst simplifies [financial modeling](https://www.financealliance.io/build-a-saas-financial-model/) by providing hands-on exercises that are rooted in real-world applications, using nothing more than your trusty Excel program. Get to grips with advanced tools, whip up impactful models from scratch, and even play with futuristic business strategies through scenario analysis. By the time you read the last page of [*Financial Modeling in Excel For Dummies*](https://amzn.to/44enMMQ), you won't just be analyzing numbers - you'll be translating them into smart business decisions. [Grab your copy](https://amzn.to/44enMMQ) --- ### 14\. *Profit First* by Mike Michalowicz ### ![Profit First by Mike Michalowicz  ](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-14.png) Ditch the flawed, traditional formula of accounting and embrace a behavioral approach that makes sense for humans. In [*Profit First*](https://amzn.to/3YO6tkz), Mike Michalowicz flips the script: **Sales - Profit = Expenses**. Drawing inspiration from the simple strategy of portion control for weight loss, Michalowicz presents an intuitive system to transform your business from a cash-hungry beast to a thriving cash generator. Dive into: - Four transformative principles making accounting a breeze through bank account insights. - The revelation that smaller, profit-first businesses can outvalue top-line-driven giants. - The path to long-term growth through early profitability. Packed with case studies, actionable advice, and Michalowicz's trademark humor, *Profit First* is the entrepreneurial playbook for the financial success you've envisioned. [Grab your copy](https://amzn.to/3YO6tkz) --- ### 15\. *Financial Management: Partner in Driving Performance and Value* by Jack Alexander ### ![Financial Management: Partner in Driving Performance and Value by Jack Alexander](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/book-15.png) Jack Alexander’s Financial Management is a practical and insightful guide that successfully connects finance and strategy. The author draws from 45 years of experience, and shares actionable tools, real-world stories, and downloadable templates to help readers improve performance and create value. The book covers key areas like forecasting, strategic planning, capital investment, M&A, and finance talent development - all through the lens of driving business results. It came strongly recommended by members of our free Slack community, who noted it was a must-read for FP&A professionals, particularly those who want to: - Improve their planning and forecasting skills - Access better tools for scenario planning and agility - Use clear models and templates for better communication [Get the book](https://www.amazon.com/Financial-Management-Partner-Driving-Performance-ebook/dp/B0CT78VWFS/ref=sr%5F1%5F1?crid=2X3MP1T89OZ3&dib=eyJ2IjoiMSJ9.rmd%5Fa8iTrl7KTqFZn2-6b9AYjeSvdLxY6Q8oE%5FhnoqDGjHj071QN20LucGBJIEps.3qDfGxkvkR1l8t0IsFyuT70ZyQ3ms9Xc4lFaeKZn2KA&dib%5Ftag=se&keywords=Financial+Management%3A+Partner+in+Driving+Performance+and+Value&qid=1743159807&s=digital-text&sprefix=financial+management+partner+in+driving+performance+and+value%2Cdigital-text%2C303&sr=1-1) --- ## Join our *free* Insider Membership! Join 1,000+ rising finance stars who trust Finance Alliance to be their preferred learning and development hub. Benefit from our community-led resources through the Insider plan, for free! Access the latest insights from renowned finance experts (from companies like Adobe, Salesforce, Burberry, Virgin Galactic, and more), battle-tested templates & frameworks, as well as a network of peers to bounce ideas off and help overcome your challenges. Become a [Finance Alliance Insider member](https://www.financealliance.io/insider-membership-plan/) for endless insights, connections, and real-life success stories... and we'll bet our bottom dollar that you'll be wanting more. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_3.png) ](https://www.financealliance.io/insider-membership-plan/) ### How to integrate ESG into your financial planning URL: https://www.financealliance.io/integration-of-esg-in-financial-planning-2/ Last updated: 2025-04-10T07:41:44.000Z Investors and customers are seeking businesses that are proactive in tackling issues like social justice, corporate responsibility, and climate change as these concerns grow. The importance of sustainability and ESG (environmental, social, and governance) considerations in financial planning is rising for firms all over the world. FP&A professionals will play a crucial role in helping organizations incorporate sustainability and ESG considerations into their financial planning processes. In today’s article, I'm going to talk about the integration of ESG in planning. ### 1\. **Evaluate long-term impact on ESG factors** When making financial plans, FP&A professionals can incorporate sustainability and ESG elements. They can do this by taking into account the long-term financial effects of social and environmental challenges. For example, a company that is heavily reliant on fossil fuels. It may face significant financial risks if regulatory or market forces lead to a shift towards cleaner energy sources. By analyzing these risks and identifying potential opportunities for transitioning to more sustainable practices. FP&A professionals can help their organizations make informed decisions that consider both short-term and long-term financial implications. ### 2\. **Company’s supply chain** Another way that FP&A professionals can integrate sustainability and ESG factors into financial planning is by evaluating the financial impact of the company’s Supply Chain. Many organizations rely on a global network of suppliers, and the actions of these suppliers can have significant environmental and social impacts. By conducting due diligence on suppliers and identifying areas for improvement. We can help their organizations reduce the risk of negative impacts and potentially even generate financial benefits through cost savings or increased efficiency. --- [Are you prepared to navigate the intricacies of an M&A?David Yates, CFO at Gresham, takes you on a journey through the intricacies of an M&A so you can unlock the best returns for your organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-99.png)Finance AllianceDavid Yates![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--48-.png)](https://www.financealliance.io/are-you-prepared-to-navigate-the-intricacies-of-an-m-a/) --- ### **3\. Analyze financial implications of CSR initiatives** FP&A professionals may assist their firms in making wise decisions about how to allocate resources to CSR efforts. They can do this by weighing the costs and benefits of these projects. By examining the financial ramifications of the company’s corporate social responsibility (CSR) programs. We can also contribute to the integration of sustainability and ESG considerations into financial planning. CSR initiatives can include a wide range of activities, such as supporting environmental conservation efforts, promoting diversity and inclusion, or providing community support. ### **4\. Shareholder/Investor communications** In addition, FP&A professionals can also help their organizations communicate the value of ESG considerations to stakeholders. This may involve creating financial models that demonstrate the potential financial benefits of sustainability and ESG initiatives. Or developing reporting frameworks that allow the organization to transparently communicate its progress on these fronts. By demonstrating the value of sustainability and ESG considerations to investors, customers, and other stakeholders. FP&A professionals can help their organizations build trust and credibility in the marketplace. --- [ESG metrics: How to drive sustainable business successIn this article, we demystify ESG metrics and provide actionable strategies to help you use them to drive sustainable business success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-100.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/ESG-METRICS.jpg)](https://www.financealliance.io/esg-metrics/) --- ### In conclusion Overall, the process of incorporating sustainability and ESG considerations into financial planning is complex, difficult and constantly changing. By taking into account the long-term financial impacts of environmental and social issues. Assessing the financial impact of the company’s supply chain, and communicating the value of these considerations to stakeholders. FP&A professionals can play a critical role in assisting their organizations navigate this process and make wise, responsible decisions. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_.png) ](https://www.financealliance.io/community/) ### Are you prepared to navigate the intricacies of an M&A? URL: https://www.financealliance.io/are-you-prepared-to-navigate-the-intricacies-of-an-m-a/ Last updated: 2025-10-08T09:13:28.000Z *This article is based on a presentation given by David Yates, CFO at Gresham, at our CFO Summit, London in 2024\. Catch up on this presentation, and others, using our* [*OnDemand service*](https://www.financealliance.io/ondemand/)*. And for more* [*exclusive content*](https://www.financealliance.io/tag/members-only-articles/)*, check out your* [*membership dashboard*](https://www.financealliance.io/pro-plus-membership-dashboard/)*.* I've recently gone through a rapid career change due to [mergers and acquisitions](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) (M&A). In fact, things moved so quickly that when I initially agreed to discuss this topic, I was the CFO of Alvio, but I am now the CFO of Gresham—a company we acquired in July 2024\. This quick shift underscores how fast-paced and unpredictable the M&A environment can be. Throughout my career, I've been fortunate to work on M&A transactions of varying scales—from significant integrations like BT's £12.5 billion acquisition of EE, to smaller strategic acquisitions and disposals within the private equity, SaaS, and tech sectors. A quote that resonates deeply with me in the context of M&A is this: ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/Screenshot-2025-03-20-at-09.09.55.png) This captures the essence of M&A perfectly. People often see the impressive outcome, such as new brands, systems, and market presence, but they rarely recognize the intense effort, sweat, and tears that go into achieving this. ## **The why behind M&A: strategic rationale** ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/Screenshot-2025-03-20-at-09.10.06.png) Understanding why you want to acquire a business is fundamental. Companies primarily generate value in four areas: - Customer value proposition - Profit formula - Resources - Processes At BT, we identified the need for a mobile network to complement our fixed-line business, prompting the acquisition of EE, which provided this essential resource. If desired, we could have theoretically stripped everything else away and kept only the mobile network, though that would have significantly eroded value. However, many companies make acquisitions for superficial or misguided reasons. For instance, when I joined Technicolor, we considered acquiring a Danish VFX company primarily because they worked with Netflix. Initially, this seemed strategically sensible, but upon closer inspection, the Danish firm was primarily servicing English-language content, such as Star Trek, and provided no real advantage in creating localized Danish content. _This post is for paying subscribers only._ ### Building AI capabilities for financial growth URL: https://www.financealliance.io/building-ai-capabilities-for-financial-growth/ Last updated: 2025-04-28T18:07:06.000Z **Discover key steps to integrate AI into finance, align AI tools with your goals, and leverage predictive analytics for smarter decisions.** In this live session with [Sage](https://www.sage.com/), Mark Johnson, Head of Commercial Finance at Browne Jacobson LLP , will walk you through the ten crucial steps for implementing AI, with practical insights on overcoming common challenges and scaling AI adoption across your finance team. Join us to gain the tools and knowledge you need to build AI capabilities that will support sustainable financial growth. **Don’t worry if you can’t attend live, register and we’ll send you the recording.** --- ## Why attend? - **Overcome AI challenges** \- Tackle resistance and skill gaps within your team. - **Seamless AI integration** \- Align AI tools with your goals. - **Cross-department collaboration** \- Enhance teamwork with AI-driven synergy. - **Predictive analytics & insights** \- Leverage AI tools for growth with real-time insights. - **Expert insights & success stories** \- Learn from leaders on successful AI adoption and growth. --- ## You'll walk away with... - **AI framework** \- A clear roadmap for selecting the right AI tools. - **AI alignment** \- Ensure AI tools support your business goals. - **Upskilling roadmap** \- Build a plan to upskill your team for AI success. - **Real-time decision-making** \- Use Sage Copilot’s tools for data-driven decisions. - **Collaboration boost** \- Foster cross-department synergy with AI. --- ## Meet the expert [**Mark Johnson**](https://www.linkedin.com/in/mark-johnsonuk/) Head of Commercial Finance, **Browne Jacobson** Mark Johnson is the Head of Commercial Finance at Browne Jacobson LLP, where he has transformed the finance function into a high-impact business partnering model, driving double-digit growth and improving profitability by over 10%. With expertise in strategic finance, FP&A, and pricing, Mark has led technology implementations to streamline processes and enhance decision-making. He is a certified Plain Numbers practitioner and is passionate about making financial information accessible to all. Previously, Mark held senior roles at Experian and Totemic, where he delivered major revenue-driving initiatives and improved forecasting processes. [**Sunil Kapur**](https://www.linkedin.com/in/sunilkapur/) Head of Solutions, **Sage** With extensive experience in solutions consulting and business development, Sunil has been pivotal in guiding organizations through their digital transformation journeys, particularly within the finance sector. Over the years, Sunil has honed his expertise in performance management, software solutions, and cloud technology, particularly with Sage Intacct. His leadership has enabled finance teams to better serve their internal and external customers, driving efficiency and enhancing overall business performance. Passionate about supporting businesses as they evolve in the digital age, Sunil is a trusted advisor for organizations seeking to optimize their financial operations and achieve greater business outcomes through innovative solutions. ### The State of FP&A 2025 Survey URL: https://www.financealliance.io/the-state-of-fp-a-2025-survey/ Last updated: 2025-04-04T14:35:16.000Z ## Where is financial planning and analysis (FP&A) headed? FP&A is transforming at a rapid pace - automation, AI, real-time insights, and strategic business partnering are redefining the role. But what does that mean for you and your career? We’re gathering insights from FP&A professionals like *you* to explore the biggest trends, challenges, and opportunities in 2025\. By taking part in ***The State of FP&A 2025 Survey***, you’ll help create a comprehensive industry snapshot that sheds light on where FP&A is today—and where it’s going next. ### **What's inside the survey?** We’ve designed this survey to capture the most pressing FP&A trends and challenges. Here’s a sneak peek at what we’re covering: 📌 **Team structure & career growth** – How are FP&A teams evolving? What skills will be most in demand? 📌 **Challenges & pain points** – What’s slowing down FP&A professionals the most? Lack of automation? Data silos? Stakeholder buy-in? 📌 **Technology & automation** – Are AI and predictive analytics transforming FP&A, or is Excel still king? 📌 **Strategic impact** – How involved is FP&A in business decisions? What role does it play in driving financial success? 📌 **Forecasting & budgeting** – What’s working? What’s not? And what’s changing in 2025? ### FAQs #### ****Will I need to give my name and contact information?** No, the survey is 100% confidential and does not require your name or contact details. Your insights are valuable, and we respect your privacy. #### ****What’s in it for me?** The more FP&A professionals participate, the more comprehensive and insightful our report will be. By contributing, you'll help create a definitive resource on the future of FP&A. In short, you'll be instrumental in shaping the most accurate and insightful report possible on the evolving landscape of FP&A and its impact on organizations worldwide. #### ****How can I see the final report?** We'll announce the launch to our network on LinkedIn, and to our email list. The report will also be available for download directly on our website. The best way to ensure you don't miss the report launch and gain access to the valuable insights is to join our mailing list. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/FA_State_of_FP-A_2025_2.png) ### The CFO’s first 30-60-90 days- Blueprint for success in a new finance role URL: https://www.financealliance.io/the-cfos-first-30-60-90-days/ Last updated: 2025-04-10T07:39:09.000Z FAnow is your chance to stream exclusive talks and presentations, hosted by finance experts and industry leaders. It's a unique opportunity to watch the most sought-after finance content – ordinarily reserved for FA Pro members. Each stream delves deep into a key finance topic, industry trend, or case study. Simply sign up to watch any of our upcoming live sessions. 🎥 Access exclusive talks and presentations ✅ Develop your understanding of key topics and trends 🗣 Hear from experienced finance leaders 👨‍💻 Enjoy regular in-depth sessions --- **Date:** May 21, 2025 **Time:** 4:00pm BST **Location:** Online [Sign up now ](https://www.linkedin.com/events/thecfo-sfirst30-60-90days-bluep7312755955429998592/theater/) Transitioning into a new CFO role is both exciting and challenging. This talk will outline a strategic 30-60-90 day plan to ensure a smooth transition and set the foundation for long-term success. Learn actionable steps and key priorities to establish your leadership, understand the financial landscape, and drive impactful changes in your new finance function. --- ### Key takeaways: - **Establish Early Credibility:** Build relationships with key stakeholders, assess team capabilities, and clarify expectations to position yourself as a strategic partner from day one. - **Assess the Financial Health:** Deep dive into financial statements, cash flow, risks, and key performance metrics to gain a clear understanding of the company’s financial landscape. - **Align Finance with Business Strategy:** Identify how finance can better support overall business goals and start shaping a roadmap for long-term value creation. - **Identify Quick Wins and Long-Term Improvements:** Balance delivering early results with building a pipeline of strategic initiatives to drive sustainable impact. - **Communicate a Clear Vision:** Set the tone for your leadership by sharing your vision, priorities, and expectations, creating alignment and momentum across the finance function. --- ### Meet the speaker: [Simon Dealy](https://www.linkedin.com/in/simondealy/), Chief Finance Officer at [World Energy ](https://www.linkedin.com/company/worldenergyllc/) Simon is a transformational CFO and strategic leader with over 20 years of experience driving growth, innovation, and enterprise value across SaaS, private equity, and professional services sectors. Known for leading over $1 billion in successful M&A transactions and collaborating with top private equity firms, Simon excels at scaling businesses and delivering measurable results. With deep expertise in public markets, operational transformation, and crisis leadership, he has a proven track record of driving revenue growth, EBITDA improvement, and high-value exits. Simon currently serves as CFO at World Energy, bringing strategic financial leadership to the renewable energy sector. Passionate about aligning strategy, finance, and operations, he thrives on help. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/03/image.png) ### ### Understanding the Rule of 78s: A critical tool for recurring revenue forecasting URL: https://www.financealliance.io/understanding-the-rule-of-78s-a-critical-tool-for-recurring-revenue-forecasting/ Last updated: 2025-10-08T09:13:33.000Z ![Rule of 78: recurring revenue forecasting](https://tirabassi.com/wp-content/uploads/2025/03/Rule-of-78s.png "Rule of 78s | Tirabassi.com") I recently created a series of financial calculators for businesses on my firm’s website. Shortly after I added the [rule of 78s calculator](https://cfoproanalytics.com/rule-of-78s-revenue-calculator/), a useful concept I have used for years, I met a SaaS banker who had never heard of the rule of 78s. I learned the rule from some of the founding executives that ran McCaw Cellular, which became AT&T wireless. They often used it to discuss the revenue risks of shortfalls in expected new MRR from new wireless subscribers. It applies to all recurring revenue businesses and has many other uses. The general application is to understand what will happen to your annual recurring revenue and calendarized 1-year recurring revenue when you overachieve or underperform in the early months of your forecast. ## Why is it called the rule of 78s? The 78 comes from that fact that Month one MRR is counted 12 times, Month two MRR is counted 11 times and so forth and Month 12 MRR is counted one time in your calendarized 1-year projection. When you add this up (12+11+10+9…+3+2+1) you get 78\. In a flat MRR projection, you can just take the MRR and multiply by 78 and it will give you the annual revenue forecast. From a practical forecasting standpoint, the critical insight is that your 12-month calendarized forecast will be impacted disproportionately by the variance of MRR in the initial months. When you miss those early month forecasts, it is very, *very* difficult to make it up over the rest of the year because month one MRR is worth 12x what month 12 MRR is worth. The impact of this will live with the forecast in ensuing years too. --- [Rolling forecast best practices | Finance AllianceA rolling forecast formula is a straightforward concept. For every period that passes, a new one is added to the end of the forecast…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-88.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/rolling-forecast-best-practices-2-1.jpg)](https://www.financealliance.io/rolling-forecast-best-practices/) --- ## What is recurring revenue? [Recurring revenue](https://www.financealliance.io/how-to-predict-revenues-using-machine-learning-within-fp-a/) is the lifeblood of many modern businesses, particularly those operating under subscription models. It represents the portion of a company’s revenue that is predictable, stable, and expected to continue at regular intervals. This type of revenue is highly valued because it provides a reliable stream of income that can be counted on to support ongoing operations and growth initiatives. For businesses, recurring revenue can come from various sources, such as subscription-based services, long-term contracts, and auto-renewing subscriptions. Investors and analysts also pay close attention to recurring revenue because it offers a clearer picture of a company’s financial health and future prospects. Unlike one-time sales, recurring revenue provides a steady flow of income that can be more easily forecasted and managed. In essence, recurring revenue is a [key metric](https://www.financealliance.io/infographic-financial-performance-metrics/) for any business looking to build a sustainable and scalable model. It allows companies to plan more effectively, allocate resources more efficiently, and ultimately drive long-term growth. ## Annual Recurring Revenue (ARR) Annual Recurring Revenue (ARR) is a critical metric for subscription models, as it measures the predictable revenue generated annually from term subscriptions. ARR provides a clear view of the revenue a business can expect to receive each year, making it an invaluable tool for [financial planning and forecasting](https://www.financealliance.io/10-big-picture-financial-planning-steps/). To calculate ARR, you take the total value of a subscription and divide it by the number of years in the subscription period. For instance, if a customer signs a two-year subscription for $12,000, the ARR would be $6,000 per year. This metric normalizes the value of recurring revenue over a single calendar year, offering a straightforward way to assess the financial health and growth potential of a business. ARR is particularly useful for [SaaS companies](https://www.financealliance.io/saas-finance-strategies/) and other subscription-based businesses because it provides a stable and predictable revenue stream that can be relied upon year after year. By focusing on ARR, businesses can better understand their revenue dynamics, set more accurate financial targets, and make informed strategic decisions. ## Monthly Recurring Revenue (MRR) Monthly Recurring Revenue (MRR) is another essential metric for subscription-based businesses, particularly SaaS companies. MRR measures the predictable revenue generated on a monthly basis, providing a more granular view of a [company’s financial performance](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/). MRR includes all recurring revenue components, such as upgrades, coupons, and discounts, but typically excludes one-time and variable fees. This metric is crucial for tracking performance across different subscription terms and understanding the monthly revenue flow. Unlike ARR, MRR is not defined by Financial Accounting Standards Board (FASB) or Generally Accepted Accounting Principles (GAAP), which means there is some flexibility in how it can be calculated. For SaaS companies, MRR is a vital indicator of business health and growth. It helps businesses monitor their monthly revenue trends, identify potential issues early, and make data-driven decisions to optimize their subscription models. By focusing on MRR, companies can ensure they maintain a steady and predictable revenue stream, which is essential for long-term success. --- [What is economic analysis? (Definition, examples, and more)It’s a question that should be at the forefront of every CFO’s mind. Yet, some are still unsure about what economic analysis is and what it involves. This guide explains economic analysis: what it is, why it matters, and how to do it.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-89.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/what-is-economic-analysis-2-1.png)](https://www.financealliance.io/what-is-economic-analysis-the-question-every-cfo-should-be-asking/) --- ## The Rule of 78s: A key concept in recurring revenue forecasting The Rule of 78s is a pivotal concept in the realm of recurring revenue forecasting. Originally used to calculate the interest paid on a simple interest loan, this rule has found significant application in [forecasting](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) recurring revenue due to its ability to account for the predictable and recurring nature of such revenue streams. In the context of recurring revenue, the Rule of 78s helps businesses understand the disproportionate impact of early-month performance on annual revenue. By recognizing that revenue generated in the initial months of a year has a more substantial cumulative effect, businesses can better strategize their sales and marketing efforts to maximize early gains. This method is particularly useful for subscription-based models, where the timing of revenue generation can significantly influence annual financial outcomes. By applying the Rule of 78s, businesses can create more accurate and reliable revenue forecasts, ensuring they are better prepared to meet their financial goals and manage growth effectively. ## Practical applications for SaaS and subscription businesses with recurring revenue The implications of the Rule of 78s are profound for any subscription-based business. Having worked with numerous SaaS companies and helped scale a business from $38M to $198M in revenue, I’ve seen firsthand how this mathematical reality shapes strategic decision-making. Accurate forecast revenue using metrics like MRR and ARR is crucial as it serves as a baseline for projecting future revenues. For example, if you’re forecasting $10,000 in new MRR for each month of the year, your annual revenue contribution from these new customers would be $780,000 (10,000 × 78). However, if you miss your January target by $2,000 (achieving only $8,000 in new MRR), that single month’s shortfall reduces your annual revenue by $24,000 ($2,000 × 12). To make up for this throughout the year, you would need to exceed your monthly targets by approximately $240 each month for the remaining 11 months – a much more challenging task than hitting your original target in January. The subscription model benefits significantly from accurate revenue forecasting, ensuring better alignment between pricing and value propositions. --- [Crisis Management Plan vs Business Continuity PlanBelieve it or not, a crisis management plan is not the same as a business continuity plan. The two are similar in many ways, sure, but they have key differences that set them apart.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-90.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Stock--4--1.png)](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) --- ## Strategic planning implications Understanding the Rule of 78s fundamentally changes how you should approach strategic planning: 1. **Front-load your efforts**: Since early months have a disproportionate impact on annual revenue, successful subscription businesses invest heavily in sales and marketing at the beginning of each fiscal year or planning period. The ROI on customer acquisition is significantly higher in January than in December. 2. **Conservative early forecasting**: When building your [financial models](https://www.financealliance.io/12-financial-modeling-best-practices-to-avoid-frustrations/), it’s prudent to be more conservative with early month projections. Overoptimistic forecasting in Q1 can create unrecoverable revenue gaps for the entire year. This conservative approach also helps in estimating future GAAP revenue, as ARR and MRR provide insights into growth and revenue predictability. 3. **Cash flow planning**: The Rule of 78s has important cash flow implications. If you’re investing heavily in growth, understanding this rule helps you better predict when new revenue will meaningfully impact your cash position. ## Visualizing the impact of Annual Recurring Revenue To truly appreciate the Rule of 78s, consider a visual representation. Imagine two scenarios: **Scenario A**: You consistently hit your target of $10,000 new MRR each month. **Scenario B**: You miss January by $3,000 but exceed each remaining month by $300. The Rule of 78s helps in understanding predictable and recurring revenue, which is crucial for assessing annual financial outcomes. This predictable and recurring revenue is a key metric in understanding Annual Recurring Revenue (ARR), representing the income expected on an annual basis from customers in subscription-based businesses. While both scenarios show the same total MRR added for the year ($120,000), Scenario A would generate $780,000 in annual revenue, while Scenario B would only generate $744,000 – a $36,000 difference despite adding the same total MRR! ## Calculating and analyzing recurring revenue Calculating and analyzing recurring revenue is a fundamental practice for businesses that rely on subscription models. To calculate recurring revenue, you multiply the number of customers by the average revenue per user (ARPU). This straightforward calculation provides a snapshot of the revenue generated from recurring sources. However, a comprehensive analysis of recurring revenue requires considering various factors, such as contract start and end dates, renewal and non-renewal rates, gaps in contracts, and early renewal upgrades. By examining these elements, businesses can identify trends, forecast future revenue, and make informed decisions about pricing, customer acquisition, and [retention strategies](https://www.financealliance.io/finance-talent/). Analyzing recurring revenue also helps businesses understand their revenue growth patterns and identify potential areas for improvement. By leveraging this analysis, companies can optimize their subscription models, enhance customer satisfaction, and drive sustainable revenue growth. In an increasingly competitive market, a deep understanding of recurring revenue dynamics is essential for long-term success. --- [Budgeting vs forecasting: Understanding 20 key differencesWhen it comes to guiding decision-making, allocating resources, and ensuring an organization’s long-term financial stability. Budgeting and forecasting are two crucial FP&A activities. Forecasting and budgeting are connected but separate activities with differing goals, methods, and results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-91.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_1_budgeting_and_forecasting.jpg)](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) --- ## Application beyond new customer acquisition for existing customers The Rule of 78s isn’t limited to new customer acquisition. It applies to any recurring revenue component: 1. **Expansion revenue**: Upselling existing customers early in the year has a significantly higher annual impact than the same upsell in later months, affecting the recurring revenue generated over the year. 2. **Churn management**: Customer retention efforts should be particularly aggressive in early months. Losing a $5,000/month customer in January is equivalent to losing more than $5,000 × 12 = $60,000 in annual revenue. 3. **Price increases**: Implementing price increases at the beginning of your fiscal year maximizes the annual revenue impact. Traditional enterprise resource planning systems might struggle to track non-GAAP metrics like Annual Recurring Revenue (ARR), often leading businesses to rely on spreadsheets that lack real-time accuracy. ## Common misconceptions Despite its utility, several misconceptions about the Rule of 78s persist: 1. **It’s not just about sales**: While sales teams often focus on the rule for commission structures, it’s truly a planning tool for the entire organization. It helps in understanding the broader implications of recurring revenues, which create predictable and stable income streams, viewed favorably by investors for their reliability and potential to lower operational risks. 2. **It doesn’t replace traditional forecasting**: The Rule of 78s complements, rather than replaces, traditional forecasting methods. It helps explain why certain variances have outsized impacts. 3. **It’s not about equal distribution**: The rule works regardless of whether you forecast equal MRR additions each month. The weighting principle applies to any recurring revenue pattern. ## Implementing the Rule of 78s in your business ![](https://i0.wp.com/images.surferseo.art/c8328daf-064c-4a82-8a4a-ebb7c8daa54a.png?ssl=1) Having implemented sophisticated forecasting models that maintained 98% accuracy, I recommend these steps to leverage the Rule of 78s effectively: 1. **Create a weighted forecast model**: Build a model that explicitly shows the weighted impact of each month’s projected MRR on annual revenue. Understanding how customers pay over the duration of their contracts can help in creating a more accurate weighted forecast model. The weighted model is not specifically weighting revenues but it reflects the impact of earlier revenues naturally in the calendar. This is one reason I prefer monthly models. 2. **Develop early warning systems**: Establish KPIs that quickly alert you to potential misses in early months, allowing for rapid course correction. 3. **Align incentives accordingly**: Consider weighting sales compensation to reflect the true revenue impact of early-year performance. 4. **Communicate the principle**: Ensure all [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) understand why early performance is so critical to annual results. ## Conclusion The Rule of 78s represents one of the most powerful yet underappreciated principles in subscription business forecasting. By understanding and applying this concept, you can make more informed decisions about resource allocation, set more realistic forecasts, and better understand the true impact of performance variances. For businesses with recurring revenue models—whether SaaS, membership services, or subscription products—mastering this principle is not merely an academic exercise but a practical necessity for accurate financial planning and successful growth management. ## Frequently Asked Questions about the Rule of 78s #### **Q1\. How do you apply the Rule of 78?** To apply the Rule of 78, multiply the amount of new recurring revenue you expect each month by 78 to estimate the total annual revenue. Conversely, divide your target annual revenue by 78 to determine how much new recurring revenue you need each month to meet your goal. #### **Q2\. What are the assumptions of the Rule of 78?** The Rule of 78 assumes that one new customer is acquired each month, each customer pays the same monthly fee and the customer remains active for the rest of the year. #### **Q3\. How does the Rule of 78 help in forecasting?** The Rule of 78 helps businesses forecast annual revenue by accounting for the compounding effect of recurring payments. It helps set sales quotas and evaluate financial stability. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_2.png) ](https://www.financealliance.io/finance-newsletter/) ### Eliminating uncertainty in financial planning with AI URL: https://www.financealliance.io/dr-no-to-dr-know/ Last updated: 2025-04-25T10:24:09.000Z ## Tired of saying “No” because you just don’t “know”? Every finance leader has been there - facing pressure to approve budgets and investments while navigating uncertainty. Without clear visibility into real-time sales and marketing data, decisions become cautious, forecasts stay conservative, and “No” becomes the default answer. But what if you could shift from reactive to proactive decision-making? What if you could confidently say “Yes” with data-backed certainty? In this session, you'll learn how AI-powered financial planning can turn static models into dynamic forecasts - giving you the confidence to say “Yes” more often. --- ## **What you'll learn?** - **Increase forecast accuracy** by seamlessly integrating sales and marketing data from platforms like Salesforce, HubSpot, and other CRMs. - **Overcome data challenges** with a finance-first approach that translates raw insights into meaningful business intelligence. - **Enhance decision-making** with AI-driven modeling that aligns financial plans with real-time pipeline and customer behavior trends. ## **The challenges we’ll tackle:** - **Lack of visibility:** Finance teams struggle to access live sales and marketing data, leading to unreliable forecasts. - **The cycle of “No”:** Uncertainty forces CFOs to default to rejection, creating misalignment between Finance, Sales, and Marketing. - **Outdated financial modeling:** Static, reactive models prevent businesses from being agile and seizing growth opportunities. --- ## **Meet the experts** [**Darrell Cox**](https://www.linkedin.com/in/darrell-cox-547a461/) CFO, **Una Software** With over 25 years of leadership experience, Darrell has built and scaled high-performing teams, driving growth and results in early and growth-stage companies. He has played pivotal roles in many companies, including Vena Solutions, FreshBooks, Virgin Mobile, Wind Mobile, and others, shaping their success through strategic leadership and execution. [**Clayton Ramnarine**](https://www.linkedin.com/in/claytonramnarine/) CEO, **Una Software** With over 20 years of experience in the software industry, Clayton has held key roles across professional services, sales, sales leadership, and as a Chief Sales Officer. As both an individual contributor and revenue leader, he has played a pivotal role in scaling successful software companies, including Prophix, Vena Solutions, and PartnerStack. ### How hackers steal your card details: BIN attacks protection tips URL: https://www.financealliance.io/how-hackers-steal-your-card-details-bin-attacks-protection-tips/ Last updated: 2025-04-10T07:40:11.000Z According to Positive Technologies, [up to 50% of banks still do not protect their clients from guessing CVV2 and Expiry Date values](https://www.ptsecurity.com/ww-en/analytics/financial-application-vulnerabilities/). This vulnerability is actively exploited by criminals, particularly in Latin America, who seek out cards and banks susceptible to these attacks. ## **Distributed attacks on card credential guessing** These attacks are often referred to as BIN Master attacks or distributed guessing attacks. The term gained notoriety from a significant case in 2016, when [the UK bank Tesco experienced such a large-scale attack](https://reflare.com/research/tesco-bank-attack) that card payments were suspended for 48 hours. Over a few days, attackers stole £22 million from 20,000 cards. This incident highlighted vulnerabilities, especially in systems not equipped with 3-D Secure. Notably, in 2018, the bank was fined £16 million, indicating that the cards lacked 3-D Secure protection. Although these figures were low compared to other major hacks in recent years, it was crucial to consider that Tesco Bank was a relatively small institution with about 136,000 accounts in total. Therefore, the 9,000 affected accounts represented 6.6% of its customer base. Previous reports had suggested that up to 30% of its total customer base was impacted. Such a high percentage of affected customers likely caused a significant erosion of customer trust, leading to financial strain for the bank. In contrast, a larger bank with more accounts would have experienced fewer negative consequences as a smaller fraction of its customer base would have been affected. The attack highlighted a significant concern for nearly all small and medium financial institutions: the limited pool of IT security expertise. Smaller banks struggled to compete for talent, as securing millions of accounts did not require proportionally more effort than securing thousands. Consequently, smaller banks had to allocate a larger portion of their budget to secure their infrastructure. Larger banks could afford better systems and higher wages, thus attracting more skilled personnel. --- [The CFO’s crash course in finance and complianceGovernance, risk management and compliance. These aren’t exactly the most exciting aspects of a CFO’s role, but that doesn’t stop them from being vital areas of focus. 🎯![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-86.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_3_compliance.jpg)](https://www.financealliance.io/finance-and-compliance/) --- ## **3-D Secure Liability rules** The 3-D Secure Liability is a service provided by the issuing bank in accordance with [PSD2 SCA regulation and EMVCo standard](https://www.visaitalia.com/dam/VCOM/regional/ve/unitedkingdom/PDF/sca/visa-psd2-sca-regulatory-guide-v1-december-2020.pdf). It is up to the merchant whether to use this service during online payment or not. Many merchants, like Booking.com and Amazon will only employ it if they estimate the probability of fraud as high. But in most of the cases merchants would skip it in order to have less friction and save conversion. ## **How hackers guess full card details** A card number consists of several parts, with the first six or eight digits being the Bank Identification Number (BIN). The last digit is a checksum calculated using the [Luhn algorithm](https://en.wikipedia.org/wiki/Luhn%5Falgorithm). For example, if a card number is 1234 5678 1234 5670, the next card in the range might end with 5688, followed by 5696, and so on. Hackers can potentially guess the expiration date if the bank issues card numbers sequentially, making it easier to guess details for subsequent cards. ## **Additional methods for guessing card details** To protect against such guesses, payment systems recommend randomising PAN (Primary Account Number) issuance. However, hackers can use various banking services to find matching PAN and Expiry Date fields, such as password recovery or mobile banking login systems. ### **Guessing the CVV / CVC** The final step is guessing the three-digit CVV2/CVC2 code. In 2014, researchers found that many online services allowed brute-forcing CVV2\. Attackers often have the tools needed to perform such attacks. In 2019, a similar vulnerability was patched in the Magento CMS payment module for PayPal. ### **Using guessed details for mobile wallets** Another common method involves using guessed credentials to set up Google Pay or Apple Pay wallets. In some cases, banks do not require additional verification for these setups, allowing attackers to use guessed card details to create fully functional virtual cards. One of the most notable fraud cases targeted Apple stores directly. The investigation revealed that Daniel Butler and his accomplices fraudulently obtained at least 477 credit cards, which they linked to Apple Pay on their iPhones. Using their iPhones, they made Apple Pay purchases at various retailers without needing the physical credit cards. According to the DOJ, the group made over $1.5 million in fraudulent purchases. The problem lies in the fact that many US banks did not require extra verification, such as a one-time code or a call to the bank, when issuing a mobile wallet like Apple Pay. As a result, with just the card number, expiration date, and CVV2 code, a fully functional virtual card could be created and used for payments globally, not just in the USA. --- [What is economic analysis? (Definition, examples, and more)It’s a question that should be at the forefront of every CFO’s mind. Yet, some are still unsure about what economic analysis is and what it involves. This guide explains economic analysis: what it is, why it matters, and how to do it.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-87.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/what-is-economic-analysis-2.png)](https://www.financealliance.io/what-is-economic-analysis-the-question-every-cfo-should-be-asking/) --- # Protection methods ## AVS Address Verification System is one of the most important layers of protection for card-not-present transactions. It checks the billing address and postcode during the transaction, which can be used in payment terminals supporting PAN Key Entry. ## Limiting multiple checkouts Another method is limiting multiple checkouts and using address verification. Restricting the number of checkout attempts for each user can deter fraudsters who rely on rapid, low-value transaction attempts. ## Transaction monitoring and analysis Transaction monitoring and analysis are also key strategies. Monitoring for high volumes of low-value purchases, which are common in BIN attacks, can help detect suspicious activity. Specific patterns, such as frequent errors in expiry dates and CVVs on the same card, can indicate card testing attempts and should be closely watched. ## Activity and event monitoring Activity and event monitoring offer another layer of protection. This involves monitoring user behaviours beyond transactions, such as logins, account changes, IP addresses, and device usage. Identifying and flagging irregular activities can help detect and prevent potential fraud before it occurs. ## User authentication Finally, user authentication provides an additional security layer. Implementing systems like CAPTCHA and multi-factor authentication (including biometrics and facial recognition) can validate user authenticity at the transaction point. This measure is particularly effective in preventing software-based brute-force attacks. Wrapping up, I want to remind that financial regulations in most parts of the world mandate institutions to "know your customer." [KYC](https://www.unit21.ai/fraud-aml-dictionary/know-your-customer) refers to a set of standards and practices designed to verify that financial customers are who they claim to be. This process includes checking if customers have criminal histories or hold politically exposed positions, which pose higher risks for abusing an institution’s services to commit financial crimes. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_2.png) ](https://www.financealliance.io/finance-newsletter/) ### What is economic analysis? (And how do CFOs do it?) URL: https://www.financealliance.io/what-is-economic-analysis-the-question-every-cfo-should-be-asking/ Last updated: 2026-01-28T16:36:31.000Z *What is economic analysis?* 🌎 It's a question that should be at the forefront of every CFO's mind. Yet, some are still unsure about what economic analysis is and what it involves. This guide explains economic analysis: what it is, why it matters, and how to do it. --- ### Table of contents: - [What is economic analysis?](https://www.financealliance.io/p/5586535f-3b80-4007-88bf-ff54daac4582/#what-is-economic-analysis) - [Economic base analysis: A key tool for CFOs](https://www.financealliance.io/p/5586535f-3b80-4007-88bf-ff54daac4582/#economic-base-analysis-a-key-tool-for-cfos) - [Methods of economic analysis](https://www.financealliance.io/p/5586535f-3b80-4007-88bf-ff54daac4582/#what-are-the-methods-of-economic-analysis) - [Examples of economic analysis](https://www.financealliance.io/p/5586535f-3b80-4007-88bf-ff54daac4582/#examples-of-economic-analysis-how-to-measure-it) - [Mini case study (inflation projections)](https://www.financealliance.io/p/5586535f-3b80-4007-88bf-ff54daac4582/#case-study-how-a-cfo-might-carry-out-analysis-based-on-inflation-projections) --- ## What is economic analysis? The purpose of economic analyses is to provide a systematic approach for evaluating the costs, benefits, and impacts of economic decisions. Often, the best way to do this is by ranking projects based on their economic viability, which will help you choose the most beneficial option. Economic analysis typically looks at key areas like ****production**, ****consumption**, and ****customer behavior**. However, there are other areas a company or Economic Analyst may want to consider. ## Economic base analysis: A key tool for CFOs Economic base analysis helps CFOs understand what drives a local economy. It looks at which industries bring money into a region from outside sources. These are usually businesses that export goods or services. It also looks at businesses that serve local needs. By comparing these sectors, you can spot good times to grow and possible risks. For instance, a town that depends on one big business could be in trouble if things change. This helps you to make smart choices about spending, expanding, or trying new things. It's a useful tool to see how a company fits with the local economy. ## **What are the methods of economic analysis?** There are a range of different methods of economic analysis, but two are seen as the primary methods: Deductive and Inductive. **Deductive method:** Starts with a general principle or theory and tests it with specific observations. **Inductive method:** Starts with specific observations and uses them to form a general hypothesis or theory. Let’s unwrap each method in more detail: ### **1\. Deductive method** This method involves moving from general principles to specific conclusions. It's often associated with theoretical economics. According to the [Unacademy](https://unacademy.com/content/ssc/study-material/general-awareness/methods-of-economic-analysis/#:~:text=There%20are%20two%20types%20of%20economic%20study%20or%20economic%20analysis,process%20of%20making%20the%20hypothesis.), this method requires the person (or persons) to “*assume the factual information and then follow the phase of logical reasoning to arrive at a concrete result or conclusion*.” A theory is then built on those assumptions. **Steps:** - **Formulate a hypothesis** based on existing economic theory. - **Use logical reasoning** to deduce implications or predictions. - **Test these predictions** against real-world data. ### **2\. Inductive method** This method involves drawing general conclusions from specific observations. It's often used in empirical economics. **Steps:** - **Observe specific economic** phenomena. - **Collect data** related to these phenomena. - [**Analyze the data**](https://www.financealliance.io/data-cleaning-techniques/)to identify patterns and trends. - **Formulate general economic theories** or principles based on the findings. --- [7 key benefits of ESG investing | Finance AllianceIn this article, we’ll discuss the key benefits of ESG investing and why ESG investing has become such a game-changer in modern finance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/tree-7788512_1280.jpg)](https://www.financealliance.io/7-benefits-of-esg-investing/) --- ## **Examples of economic analysis: How to measure it** CFOs are key to shaping a company's [financial strategy](https://www.financealliance.io/financial-accountability/), which directly impacts its economic health. The steps of performing an economic analysis usually take the form of something like this: 1. **Define the goal:** Clearly define what you want to achieve with the analysis. 2. **Consider uncertainties:** Identify potential factors that could affect the outcome and create a list of these assumptions. 3. **Explore alternatives:** Determine different approaches or solutions. 4. **Analyze Costs and Benefits:** Evaluate the advantages and disadvantages of each option. 5. **Compare choices:** Assess the options and compare alternatives based on their costs and benefits. 6. **Test assumptions:** Carry out sensitivity and uncertainty analyses to analyze how changes in factors might impact the results. 7. **Present findings:** Summarize the results and recommend a course of action. You might want to incorporate other approaches to your ecomonic analysis process. Here are some of the common ways you can do this: ### **1\. Microeconomic and macroeconomic analysis** **Microeconomic analysis**: Looks at specific markets and how consumers and businesses behave. It covers: - Supply and demand - Pricing - Production - Consumption patterns **Macroeconomic analysis**: Studies the entire economy. Key areas include: - GDP - Unemployment - Inflation - Overall economic growth ### **2\. Financial ratio analysis** Financial ratio analysis is a way to check a company's health by using numbers from its [financial reports](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/). Key numbers include how well the company can pay its bills (liquidity), how much it earns (profitability), and how much it owes (leverage). ### **3\. Cost-benefit analysis (CBA)** [Cost-benefit analysis](https://www.financealliance.io/cost-benefit-analysis/) weighs up the potential costs and benefits of a project or decision to see if it's worth doing and how much it could make. ### **4\. Scenario and sensitivity analysis** [Scenario analysis](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/) involves evaluating different future scenarios to understand potential impacts on the company, while sensitivity analysis shows how changing key factors affect results. ### **5\. Net Present Value (NPV) and Internal Rate of Return (IRR)** NPV and IRR are ways to figure out if an investment is worth it. NPV adds up future money, adjusted for today's value, and subtracts the upfront cost. IRR is the percentage return the investment needs to make to break even. ### **6\. Benchmarking** Benchmarking involves comparing a company’s performance metrics with industry standards or competitors to identify areas for improvement and set performance goals. ### **7\. Economic value added (EVA)** EVA shows how much extra a company makes beyond what investors expect. It's the profit after taxes and other costs, minus the money it costs to run the business. ### **8\. Trend analysis and forecasting** Trend analysis examines historical data to identify patterns and trends over time, while [forecasting](https://www.financealliance.io/rolling-forecast-best-practices/) uses this information to predict future financial performance. ### **9\. Risk and uncertainty analysis** [Risk and uncertainty analysis](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) helps CFOs understand what could go wrong with economic decisions. It looks at things like: - Market ups and downs - Economic cycles - Unexpected events This helps predict how these factors might affect business outcomes. ### **10\. Behavioral economics** Behavioral economics looks at how our thoughts, feelings, and social lives affect our money choices. It shows that we don't always make decisions like the old money books say. --- [How to use GPT-4o mini in Excel & Google SheetsOpenAI has made a significant stride in making AI more accessible with the release of GPT-4o mini, their most cost-efficient and intelligent small model yet.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/GPT-4o-mini.jpg)](https://www.financealliance.io/gpt-4o-mini-in-excel-google-sheets/) --- ## **Case study: How a CFO might carry out analysis based on inflation projections** According to the [International Monetary Fund’s](https://www.imf.org/en/Publications/WEO/Issues/2024/01/30/world-economic-outlook-update-january-2024) economic outlook update, inflation is projected at **3.1** percent in 2024 and **3.2** percent in 2025\. With this information, a consumer goods company CFO could use this info to plan their budget and strategy by: - Adjusting prices to keep up with inflation - Reviewing supplier contracts and costs - Planning for higher operating expenses - Considering how inflation might affect consumer spending - Exploring ways to improve efficiency and cut costs This approach helps the CFO prepare for the expected economic changes. --- ### How to use ChatGPT for data cleaning URL: https://www.financealliance.io/using-chatgpt-for-data-cleaning/ Last updated: 2025-04-10T07:40:35.000Z I’m always on the lookout for tools that can streamline financial analysis and provide valuable insights. One such tool that has caught my attention is ChatGPT’s data analysis features. In this blog post, I’ll explore how these features can be applied in day-to-day financial analysis and provide a comparison with PowerQuery’s data cleaning capabilities. ## Data cleaning with ChatGPT [Data cleaning](https://www.financealliance.io/data-cleaning-techniques/) is a crucial step in any analysis, as it ensures the accuracy and consistency of the data. ChatGPT’s data cleaning feature is a powerful tool that can save significant time and effort. To clean a dataset, you can provide the following prompt: **Here is my dataset \[upload or paste dataset\]. Please perform the following data cleaning tasks:** - **Remove any duplicate rows** - **Handle missing values (e.g., replace with mean, median, or drop rows)** - **Ensure consistent formatting (e.g., date formats, capitalization)** - **Identify and correct any obvious errors or inconsistencies** [ChatGPT ](https://www.financealliance.io/chatgpt-canvas-for-finance-fp-a/)will then analyze the dataset and provide a cleaned version, along with a summary of the actions taken. This cleaned dataset can be downloaded and used for further analysis. In comparison, PowerQuery’s data cleaning capabilities are also robust, but they require more manual effort. You need to create a series of steps to transform the data, such as removing duplicates, handling missing values, and formatting columns. While this provides more control over the cleaning process, it can be time-consuming, especially for large datasets. One other big advantage of PowerQuery is the ability to create a standardized process for a workflow that you repeat frequently using a standardized input of data that always needs the same reformatting. Quickbooks reports are a good example of a situation where you might create a permanent solution with PowerQuery. ## Data visualization with ChatGPT Once the data is cleaned, ChatGPT can generate various visualizations to help identify trends and patterns. For example, to [create a line chart](https://www.financealliance.io/financial-charts-and-graphs/) showing revenue over time, you can use the following prompt: **Create a line chart showcasing the revenue for each month in the dataset.** ChatGPT will generate an interactive line chart that you can download or embed in your analysis. You can also request additional visualizations, such as scatter plots or bar charts, by modifying the prompt accordingly. --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-85.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/ChatGPT-for-Excel-1.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ### **Example: Analyzing social media impact on revenue** Let’s consider a scenario where you want to analyze the impact of social media posts on revenue for a company. You have a dataset containing monthly revenue figures and the number of social media posts. To clean the data, you can use the following prompt: **Here is my dataset \[upload or paste dataset\]. Please perform the following data cleaning tasks:** - **Ensure consistent capitalization for column names** - **Convert revenue values to a consistent currency format** - **Handle any missing values by replacing them with the median value** After cleaning the data, you can create a dual-axis line chart to visualize the relationship between revenue and social media posts: **Create a dual-axis line chart with revenue on the primary y-axis and social media posts on the secondary y-axis. Plot both lines on the same chart to visualize any potential correlation.** This [visualization](https://www.financealliance.io/storytelling-with-data-visualization/) can help identify patterns, such as periods where an increase in social media posts coincided with higher revenue, or vice versa. ChatGPT’s data analysis features offer a powerful and efficient way to clean and visualize financial data. By leveraging these capabilities, you can streamline your analysis process and gain valuable insights into your organization’s financial performance. I have used this mainly for ad hoc analysis where I need some quick answers that I can snip and drop in an email or a chat application. For more sophisticated reporting, I try to create permanent workflows that I can use over and over again as I described above or better yet leverage a 3rd party application that does the work perfectly. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_6.png) ](https://events.financealliance.io/) ### The best working capital strategies for FP&A URL: https://www.financealliance.io/the-best-working-capital-strategies-for-fp-a/ Last updated: 2025-10-08T09:13:44.000Z *This article is based on a presentation given by Liudmila Gudina, Global Working Capital Manager at Fagron, at our FP&A Summit, London in 2024\. Catch up on this presentation, and others, using our* [*OnDemand service*](https://www.financealliance.io/ondemand/)*. And for more* [*exclusive content*](https://www.financealliance.io/tag/members-only-articles/)*, check out your* [*membership dashboard*](https://www.financealliance.io/pro-plus-membership-dashboard/)*.* Working capital is often the last thing on the agenda in leadership meetings. After discussing profit and sales, everyone is drained, and few want to dive into the operational details of working capital. However, it's the only tool businesses can use to generate cash effectively. With rising interest rates and increasing borrowing costs, mastering working capital is more critical than ever. ## Understanding the complexity of working capital The pharmaceutical industry offers a perfect case study for the challenges of managing working capital. With operations across North America, Latin America, and EMEA, balancing cash flow, product availability, and payment terms is an ongoing struggle. ### 1\. **Product availability vs. cash flow** High product availability is crucial, *especially* when patient trends are unpredictable. The COVID-19 pandemic highlighted this volatility and companies were left with millions in unsold stock as demand suddenly shifted. Some diseases can be forecasted, but others emerge unpredictably, making inventory management a complex challenge. ### 2\. **Diverse payment terms** Hospitals, particularly public ones, have their own payment schedules that companies can't control. Small pharmacies also follow unpredictable payment cycles, adding another layer of complexity. Regional differences impact how companies negotiate payment terms with suppliers, often limiting opportunities for optimization. ## The role of working capital in generating cash Once operating profit is accounted for, companies have [capital expenditures](https://www.financealliance.io/capex-vs-opex/) (CapEx) and taxes to consider. Beyond that, investors focus on cash generation. Given that interest rates are rising and will likely never return to zero, borrowing costs continue to increase. Unlike operating costs, borrowing costs grow exponentially with scale. Managing working capital efficiently is the best way to mitigate these financial pressures. --- [How to use Grok 3 in finance and FP&AElon Musk’s artificial intelligence venture, xAI, has unveiled its latest AI model, Grok 3, calling it “scary smart.” Let’s see if it’s got what it takes to assist you in financial planning, analysis, and beyond.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-75.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Stock--3--3.png)](https://www.financealliance.io/how-to-use-grok-3-in-finance-and-fp-a/) --- ## How to optimize working capital Each region, industry, and company has its own challenges, requiring tailored solutions. Here’s how companies can better manage working capital: #### 1\. **Data-driven budgeting and forecasting** - Exclude one-off events when [budgeting and forecasting](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/). Many companies mistakenly include extraordinary expenses or revenues from past years, distorting their financial outlook. - Ensure clean and accurate databases *before* investing in external solutions. If you hire someone to optimize your working capital, you need to ensure they have accurate payment terms and transaction records. - Set clear assumptions based on top suppliers and procurement data rather than generic percentages. Using general reductions in overdue payments as a target is meaningless without identifying the underlying operational factors driving these figures. #### 2\. **Shifting focus from KPI reporting to actionable insights** - Traditional KPIs like DSO, DPO, and DIO are reporting metrics, not drivers. If you rely on 12-month averages, you miss real-time decision-making opportunities. - Instead, align calculations with operational cycles. For example, if your pharmacy clients pay within 30 days, analyzing trade receivables against two months of sales is more insightful than relying on a rolling annual metric. - Always analyze in ratios, not just in values. Inflation, industry shifts, and volume changes make value-based analysis misleading. You need to compare percentage changes over time to gain real insights. #### 3\. **Incentive programs for collections and procurement** - Incentives improve collections efficiency, but if budgets are tight, a strong scorecard system can serve as an alternative. - [Scorecards](https://www.financealliance.io/how-to-boost-the-bottom-line-with-balanced-scorecards-bsc/) should measure both process efficiency and results, weighted across different regions. Don't just track end results—monitoring improvement steps provides a clearer picture of effectiveness. - Procurement savings should align with payment term strategies; otherwise, companies may optimize one at the expense of the other. If procurement teams are incentivized to focus only on cost reductions, they may ignore opportunities to extend payment terms, hurting overall [cash flow](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/). - There is often a contradiction between procurement savings and working capital improvements. If a procurement team negotiates cost reductions at the expense of longer payment terms, the benefit can be lost. These two aspects must be separated in negotiations. --- [Cost-benefit analysis: 5 steps to turn data into smarter choicesIf you want to learn more about what cost-benefit analysis is and how to do it, keep reading as we dive into five key steps to streamline your financial evaluations and drive smarter decisions. 🧠![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-76.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--6-.png)](https://www.financealliance.io/cost-benefit-analysis/) --- ### Speaking the right language One of the biggest mistakes finance professionals make is discussing financial KPIs with operational teams. They simply don’t resonate. Instead: - **Procurement:** Talk about weighted average payment terms. - **Commercial teams:** Focus on contract terms. - **Supply chain:** Discuss days of coverage, safety stock, and forecast accuracy. If you increase payment terms from 30 days to 60 days, you must give something back—like ensuring on-time payments. Similarly, you need substitute suppliers in place to handle any disruptions. ## Improving demand planning for better inventory management Rather than looking at [overall forecast accuracy](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/), focus on high-margin, high-cost items. These have the most significant impact on working capital. Companies often get stuck in outdated inventory management practices, failing to revise ABC categorization over time. The result? Expired stock and unnecessary write-offs. - Avoid focusing on total forecast accuracy, as it does not reflect financial impact. Instead, prioritize high-margin, high-cost items that drive the biggest inventory costs. - Review ABC categorization annually—items that were once categorized as low-priority (C items) may have shifted, leading to unnoticed write-offs and expirations. - Recognize that an outdated ABC model may not reflect operational realities. By revising categories dynamically, businesses can optimize inventory levels without overcommitting resources to slow-moving stock. ### The bottom line Working capital is not just an operational metric—it is a strategic tool for cash generation. If you aspire to leadership roles in FP&A or beyond, understanding and optimizing working capital is essential. It requires a tailored approach, cross-functional collaboration, and a shift from traditional KPI reporting to actionable business strategies. By integrating working capital into budgeting, forecasting, and operational decision-making, businesses can improve cash flow, reduce financial risk, and ultimately drive sustainable growth. ### Action points - Analyze the database to exclude one-off events and focus on operational drivers. - Link receivables and payables metrics to the operational cycle, not just 12-month averages. - Implement incentive programs or scorecards for collections, focused on process improvements, not just results. - Align procurement savings targets with payment term negotiations to avoid conflicts. - Discuss working capital initiatives with operational teams in their own language, focusing on their key metrics (e.g., weighted average payment terms, forecast accuracy). - Prioritize inventory management based on cost and margin impact, not just ABC classification. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_6.png) ](https://events.financealliance.io/) ### Unlocking the potential of AI in finance URL: https://www.financealliance.io/unlocking-the-potential-of-ai-in-finance/ Last updated: 2025-04-04T11:16:11.000Z **Most finance functions are still laying the groundwork - tightening up forecasting, building solid platforms, and trying to bring structure to the chaos.** AI is everywhere, but how many businesses are actually using it in a meaningful way? In this session, Vaughan Grandin, Head of Financial Modelling at Teneo, alongside **Sunil Kapur**, Head of Solutions at Sage, cut through the noise. --- ## **Explore:** - The key differences between generative AI and traditional AI, and how each is *(or isn’t)* showing up in finance. - How AI automates workflows, improves accuracy, and strengthens financial security. - Use cases such as automation, anomaly detection, and fraud prevention. - Actionable steps for integrating AI tools like Sage Copilot to drive strategic growth. --- ## **Walk away with** - A clearer understanding of how AI fits into financial decision-making. - Insights into building a solid foundation before scaling AI initiatives. - A practical lens on managing risk, security, and transparency with AI tools. - Real examples of how finance teams are approaching automation, fraud prevention, and anomaly detection today. --- ## **Meet the experts** [**Vaughan Grandin**](https://www.linkedin.com/in/vgrandin/) Head of Financial Modelling, **Teneo** **Vaughan Grandin** is the **Head of Financial Modelling** at **Teneo**, where he leads a team specializing in crafting robust and user-friendly financial models to support strategic decision-making for clients. With over 15 years of experience in corporate advisory, finance, and restructuring, Vaughan has guided companies and stakeholders through critical situations, often involving financial distress or significant regulatory and political scrutiny. He has expertise in financial modelling, working capital optimization, and contingency planning. Vaughan is a qualified chartered accountant, having ranked 8th in South Africa in his final board examinations. Having also co-authored insights on financial modelling best practices, such as the “Core Elements of Robust Financial Modelling,” emphasizing the importance of driver-based models in delivering accurate and useful forecasts. His extensive experience and leadership in financial modelling make Vaughan Grandin a trusted advisor for clients navigating complex financial challenges. [**Sunil Kapur**](https://www.linkedin.com/in/sunilkapur/) Head of Solutions, **Sage** With extensive experience in solutions consulting and business development, Sunil has been pivotal in guiding organizations through their digital transformation journeys, particularly within the finance sector. Over the years, Sunil has honed his expertise in performance management, software solutions, and cloud technology, particularly with Sage Intacct. His leadership has enabled finance teams to better serve their internal and external customers, driving efficiency and enhancing overall business performance. Passionate about supporting businesses as they evolve in the digital age, Sunil is a trusted advisor for organizations seeking to optimize their financial operations and achieve greater business outcomes through innovative solutions. ### How a financial model serves as your north star URL: https://www.financealliance.io/how-a-financial-model-serves-as-your-north-star-2/ Last updated: 2025-10-08T09:14:38.000Z A [financial model](https://www.financealliance.io/12-financial-modeling-best-practices-to-avoid-frustrations/) roadmap is a helpful rubric for any founder or entrepreneur. I’ve witnessed firsthand the transformative power of a sound financial model. It’s not just a set of spreadsheets; it’s the north star that guides a business through the unpredictable seas. It’s crafted not only for the entrepreneur but also for the stakeholders who journey alongside them. ## Execution for both owner and stakeholders The execution of a [financial model](https://www.financealliance.io/10-best-financial-modeling-tools/) serves a dual purpose. For the business owner, it’s a roadmap, charting the course from inception to profitability. For stakeholders, it’s a lens through which they can view the business’s potential and trajectory. It’s a shared vision, meticulously quantified and laid out. As a user and owner of the model, think of it as a narrative that tells the story of your business’ future. When investors review the projections, they’re not just looking at figures; they’re looking for a story that resonates with them, one that they can believe in and support. Your business narrative can become even more powerful with the support of your financial model. --- [Adobe’s strategy for customer journey-based financial planningHow can finance departments truly support business goals? Adobe’s customer journey-centric approach provides a compelling answer to help finance teams move beyond traditional budgeting to embrace a more dynamic, customer-focused model.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-70.png)Finance AllianceParth Kulkarni![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--31--2.png)](https://www.financealliance.io/adobes-strategy-for-customer-journey-based-financial-planning/) --- ## Complexity vs. accuracy As businesses mature, the complexity of their financial models naturally increases. However, complexity should never overshadow accuracy. A model bloated with unnecessary details loses its effectiveness. It’s about striking the right balance—ensuring that the model remains a true reflection of the business, even as it grows and evolves. Take, for example, a SaaS startup specializing in marketing automation. The financial model here doesn’t just predict revenue streams; it serves as a strategic tool for pricing, resource allocation, and market positioning. It must remain accurate and relevant, regardless of the business’s stage or complexity. Similarly, a D2C sustainable clothing brand must maintain a model that accurately reflects its unique value proposition and operational realities. Critical aspects of contract manufacturing and working capital terms are essential. As the brand scales, the model should evolve, but its core—its accuracy and relevance—must remain intact. ## A roadmap for financial modeling As the venture moves into the **post-revenue phase**, the financial model becomes more intricate, incorporating marketing, sales, and revenue forecasts. It now serves as a strategic tool for setting growth objectives, with customer acquisition costs, salesforce expansion, conversion rates, pricing, and deal sizes becoming pivotal metrics. When the business begins to generate consistent revenue, attention shifts to **working capital management**. Accurate projections of payables and receivables become essential, linking back to the revenue model and increasingly complex cost drivers, laying the groundwork for the company’s first comprehensive balance sheet. **Scaling the business** necessitates advanced staffing models and, potentially, space leasing models, introducing significant fixed costs into the financial model. These costs, while fixed in the short term, evolve into mixed costs that must be scaled in line with projected growth over a five-year horizon. Finally, as the business approaches **profitability**, the financial model must be robust, with a solid balance sheet in place. At this juncture, [scenario planning](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) for equity and debt financing becomes crucial, alongside more sophisticated cash flow management strategies, ensuring the business’s financial agility and resilience. A financial model is more than a set of spreadsheets. It’s the embodiment of the business’s vision, strategy, and operational plan. It’s a tool that, when executed with precision and clarity, serves both the entrepreneur and their stakeholders. It’s the guiding star that ensures every decision is made with a clear understanding of its financial implications. ## Key takeaways As businesses grow and the stakes get higher, the importance of maintaining an accurate and effective financial model only intensifies. It’s the beacon that lights the way forward, ensuring that the journey from startup to success is navigated with confidence and foresight. What challenges do you face in ensuring your financial model remains your guiding star? --- [Transferable FP&A skills that open doorsDid you know that you can leverage transferable skills in FP&A (financial planning & analysis) to shape the career (and life) you truly want? Whether you love your job or find yourself itching for something new, transferable skills can open up career paths you might not have considered.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-71.png)Finance AllianceJody Salbo![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--21--3.png)](https://www.financealliance.io/transferable-fp-a-skills-that-open-doors-way-beyond-finance/) --- ## FAQs ### **What is a financial model, and why is it important for businesses?** A financial model is a set of spreadsheets that represent the business’s vision, strategy, and operational plan in numerical terms. It helps entrepreneurs and stakeholders to evaluate the financial performance and potential of the business, as well as to identify and mitigate risks. ### **How can I create an accurate and effective financial model for my business?** There is no one-size-fits-all approach to financial modeling, but some general steps are to define the purpose and scope of the model, gather and analyze relevant data, choose and implement appropriate methods and assumptions, test and validate the model, and communicate and update the results. ### **What are some common challenges and pitfalls in financial modeling, and how can I avoid them?** Some common challenges and pitfalls in financial modeling are overcomplicating or oversimplifying the model, using inconsistent or outdated data, making unrealistic or unsupported assumptions, ignoring or misrepresenting uncertainties and sensitivities, and failing to document or explain the model clearly. To avoid these, it is advisable to follow best practices and standards, use reliable and verified sources of data, apply logical and reasonable assumptions, conduct sensitivity and scenario analysis, and document and present the model with transparency and clarity. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/FA_Article_Banners_Assets_6.png) ](https://events.financealliance.io/?%5Fgl=1%2A1rdlnvt%2A%5Fgcl%5Fau%2AODUxMzcwNjU1LjE3MzY3NjEwOTk.) ### Global Finance Report Key insights from 750+ finance leaders URL: https://www.financealliance.io/global-finance-leaders-report-how-to-make-a-bigger-impact-as-a-finance-leader/ Last updated: 2025-04-25T10:59:02.000Z ### **What’s shaping finance in 2025?** Discover key insights from 751 finance leaders on the strategies, challenges, and technology investments shaping the future of finance in 2025. Did you know that **91% of finance leaders** are optimistic about their business’s financial prospects in 2025? Yet, they’re navigating some of the most complex challenges in finance today - including scaling operations, managing risk, and implementing AI-driven solutions. So, how do today’s top finance leaders drive impact without getting buried in spreadsheets and uncertainty? The answer: **strategic leadership and tech-powered transformation.** ### Why finance leadership is evolving: - **Balancing risk with opportunity.** 70% of finance leaders say their companies are becoming more open to risk, but that means making smarter, data-driven decisions to stay competitive. - **Digital transformation is no longer optional.** 75% of finance leaders have already started their transformation journey, with investments in automation, AI, and real-time financial reporting. - **Cross-functional leadership is critical.** Finance leaders are moving beyond traditional number-crunching and stepping into strategic advisor roles, collaborating with C-suites to drive business growth. In [**this report**](https://share-eu1.hsforms.com/18fo0WjaiT-iPoggk7D%5FtEQ2b1vun), courtesy of **Prophix**, we dive deep into the three leadership approaches that finance leaders are using to navigate 2025 and the game-changing tech investments helping them scale. ### And you don’t need a magic wand - just actionable insights like: 1. How Expanders, Catalysts, and Protectors approach financial leadership - and which strategy aligns with your role. 2. What finance leaders are prioritizing when it comes to AI, automation, and digital tools. 3. The biggest challenges in scaling finance teams (and how to solve them). ...and much more. So, [**grab the report**](https://share-eu1.hsforms.com/18fo0WjaiT-iPoggk7D%5FtEQ2b1vun) and... - Make informed decisions that move the business forward. - Stay ahead with data-driven strategies from 751 finance leaders. - Lead with confidence—whether you’re scaling, optimizing, or protecting. [Download the report](https://share-eu1.hsforms.com/18fo0WjaiT-iPoggk7D%5FtEQ2b1vun) ### How to use Grok 3 in finance and FP&A URL: https://www.financealliance.io/how-to-use-grok-3-in-finance-and-fp-a/ Last updated: 2025-10-08T09:14:42.000Z Elon Musk's artificial intelligence venture, xAI, has unveiled its latest AI model, [**Grok 3**](https://x.ai/grok). Described by Musk as "*scary-smart*," Grok 3 boasts advanced reasoning capabilities and is poised to challenge existing AI giants like [ChatGPT](https://www.financealliance.io/chatgpt-canvas-for-finance-fp-a/) and [Google’s Gemini](https://www.financealliance.io/how-to-use-gemini-ai-with-google-sheets/). [Grok 3's development](https://www.cnbc.com/2025/02/18/elon-musk-xai-grok-3-model-release-ai-competition-.html) was powered by xAI's Colossus supercomputer, which utilizes 100,000 Nvidia H100 GPUs, providing over 200 million GPU-hours for training. This substantial computational investment has resulted in a model with enhanced logical reasoning and accuracy, capable of processing information swiftly and delivering responses with minimal errors. **Source:* [**TheAIGRID*](https://www.youtube.com/@TheAiGrid) *YouTube channel* ## **Quick-fire points to know about Grok 3** 🔥 According to the xAI team, [Grok 3](https://www.financialexpress.com/life/technology-road-to-grok-3-how-elon-musk-and-xai-team-built-the-smartest-ai-on-earth-and-what-happens-now-3752758/) is the “*smartest AI on earth*” and “*an order of magnitude more capable*” than Grok 2, which launched in August 2024. 🔥 Developers have implemented reinforcement learning to enhance its reasoning skills, and early internal tests suggest the model is beginning to exhibit signs of creativity. 🔥 A major addition to Grok 3 is [Deep Search](https://www.bloomberg.com/news/articles/2025-02-18/musk-s-xai-debuts-grok-3-ai-bot-touting-benchmark-superiority), an emerging AI-powered search tool that could evolve into a direct competitor to Google Search. 🔥 A scaled-down version of the reasoning model, referred to as a "mini" edition, will also be available. It’s also worth noting that the launch of Grok 3 coincides with an intense period of competition between Musk and [OpenAI](https://www.financealliance.io/how-to-use-azure-openai-on-your-data-in-finance-fp-a/), with their ongoing legal battles and frequent public disputes dominating headlines. Here's a visual representation of how Grok 3 compares to similar AI models in areas like math, science, and coding: ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/02/Screenshot-2025-02-18-at-10.18.48.png) **Source:* [**X.com*](https://x.com/BrianRoemmele/status/1891705751506387248?ref%5Fsrc=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Etweet&mx=2) ## Using Grok 3 for finance With all that being said, let’s answer the question we’re all thinking – how can you use Grok 3 for finance and [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/)? ### **1\. Generate financial forecasts** Grok 3 can analyze your company's past performance and current market trends to predict future financial outcomes. **💡 Sample prompt:** "*Based on our last three quarters and current market conditions, forecast our financial performance for the next year*." ### **2\. Create a variance analysis** Grok 3 can compare actual financial performance against budgeted figures, highlighting discrepancies and potential causes for deviations. **💡 Sample prompt:** *"Analyze last quarter’s financial performance against our budget and identify key areas of overperformance and underperformance."* ### 3\. Perform scenario analysis It can model different [financial scenarios](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/), helping you understand potential impacts of various business decisions. **💡 Sample prompt:** "*Show how a 15% increase in raw material costs could affect our profit margins over the next six months.*" --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-74.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ### 4\. Mergers & acquisitions analysis Evaluate potential deals by analyzing financial statements and [forecasting post-merger benefits](https://www.financealliance.io/m-a-best-practices/). **💡 Sample prompt:** "*Assess the financial health of Company X and predict the benefits of acquiring them.*" ### 5\. Cash flow optimization Find ways to improve [liquidity](https://www.financealliance.io/12-proven-strategies-for-managing-liquidity/) by analyzing spending and revenue patterns. **💡 Sample prompt:** "*Suggest strategies to enhance our cash flow based on the past year's financial data.*" ### 6\. Creating financial reports and dashboards It can automate the creation of detailed reports and dashboards, making complex data easier to digest. **💡 Sample prompt:** "*Generate a dashboard summarizing our key financial metrics for the past month.*" ### 7\. Automated expense management You can use Gok 3 to spot inefficiencies in spending and suggest cost-cutting measures. **💡 Sample prompt:** "*Review our operational expenses and recommend areas where we can reduce costs without affecting performance.*" As Elon Musk and xAI continue to push the boundaries of AI, the finance world is poised for a major transformation. While Grok 3 won’t replace financial analysts, it *will* undoubtedly become an essential tool for making smarter, data-driven decisions in an increasingly volatile market. Those who embrace this technology early will have a significant edge in planning, forecasting, and [navigating financial challenges](https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/). --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_3.png) ](https://www.financealliance.io/insider-membership-plan/) ### Scenario planning: How to navigate uncertainty with confidence URL: https://www.financealliance.io/scenario-planning-how-to-navigate-uncertainty-with-confidence/ Last updated: 2026-04-20T07:15:41.000Z Traditional planning is usually constructed on the assumption that tomorrow’s world will be much like today’s, and is usually based on a single course or scenario. In some cases, it incorporates sensitivity analysis structured around changing key variables. But [scenario planning](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) is more than just a financial planning tool—it’s an integrated approach to dealing with uncertainty. It’s about visualizing different representations of an organization’s future based on differing assumptions about the business environment and the forces driving the market. It’s about understanding the impact with the goal of creating higher levels of preparedness. In this respect, scenario development is just as important as the final product. ## **Key benefits of scenario planning** Incorporating [scenario planning](https://www.financealliance.io/scenario-planning-strategic-forecasting-for-finance-teams/) into strategic and financial planning cycles brings several key benefits. It: - **Embraces and structures uncertainty** - **Builds an understanding of the broader business environment across the organization** – It’s not just the responsibility of finance. It requires input from key departments from the beginning to the end of the process. - **Helps organizations think flexibly and creatively**, allowing alternative views and new ideas to surface. - **Makes key assumptions explicit and surfaces hidden risks** – It forces organizations to articulate and test their critical business assumptions. - **Shifts your business strategy from reactive to proactive**, preparing teams to mitigate risks if the worst-case scenarios materialize and take advantage of positive opportunities that may arise. - **Helps identify sure-fire strategic decisions to pursue** and leads to the development of more thoughtful and resilient plans. --- [Data storytelling for FP&AWhat do Barack Obama, Oprah Winfrey, and Nikki Glaser have in common? They all excel in storytelling...and you can do (yes, even as a finance professional!). Here’s how…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-67.png)Finance AllianceMathew Reynders![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--37--1.png)](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/) --- ## **How to implement an effective scenario planning process** Scenario planning isn’t one-size-fits-all—it must be tailored to an organization’s specific needs, circumstances, teams, and the technology and resources they have available. However, a solid approach generally follows a few key steps: ### **1) Determine your direction and long-term goals**. Many of us do strategic plans that cover the next 3-5 years. This is done before we enter into a new financial year, do the budget, or start carrying out [rolling forecasts ](https://www.financealliance.io/rolling-forecast-best-practices/)every month. ### **2) Bring the right stakeholders together** You need to decide who's going to be at the table with you. Which individuals need to participate in discussions about the scenarios and alternative futures that you want to design strategies for? ### **3) Identify the key drivers that could impact success** The risk team, strategy team, commercial team, and divisional leadership usually sit together and determine the key factors that impact the targets that you’ve set. You need to consider the main drivers that will significantly alter the numbers and dynamics of your organization and what internal and external forces may change the factors that are important for them. For example, it could be the price of a raw material, competitors, fuel prices, energy costs, etc. ### **4) Discuss conditions, assumptions, and probabilities** Talk to your key stakeholders about the conditions your company is currently operating in and the conditions you think they'll need to operate in for the next three to five years. Discuss your assumptions and the probabilities of what may happen, and agree on four or five scenarios that are worth dedicating time to. ### **5) Run and evaluate the impact of your scenarios** Once you've got your 4-5 scenarios, both positive and negative, run and evaluate the impact of each one. It doesn't matter which tool you use to do this, but the more powerful it is, the better. You’ll be able to run quicker, better scenarios, but remember, it's not about quantity; it's about quality. You then need to analyze each scenario’s potential effects on things like P&L and [cash flow](https://www.financealliance.io/3-cash-flow-forecasting-challenges/) to get a good understanding of the financial implications. ### **6) Identify early indicators and mitigation actions** You need to pinpoint the early signals that those scenarios are materializing. You then need to work with the broader team to figure out mitigation actions and exploitation strategies that preserve or deliver on your set direction and long-term strategy. What are you going to do if this scenario materializes? How are you going to react? ### **7) Monitor drivers** Once you’re happy with the indicators you’ve defined and you have a solid strategy in place, keep track of those scenarios and monitor the key drivers that you’ve identified. Doing this will give you the early signs that those scenarios are actually materializing. Refresh your scenarios, and then act accordingly. --- [Adobe’s strategy for customer journey-based financial planningHow can finance departments truly support business goals? Adobe’s customer journey-centric approach provides a compelling answer to help finance teams move beyond traditional budgeting to embrace a more dynamic, customer-focused model.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-68.png)Finance AllianceParth Kulkarni![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--31--1.png)](https://www.financealliance.io/adobes-strategy-for-customer-journey-based-financial-planning/) --- ## **What makes a useful scenario?** Not all scenarios are created equal. A useful scenario should be: - **Relevant** – It directly impacts the business and its strategic goals. - **Plausible** – Not extreme (e.g., an alien invasion) but grounded in reality. - **Material** – The impact must be significant enough to warrant planning. - **Consistent** – You should avoid mixing external factors that generate conflicting dynamics in your business. For example, if you’re looking at a recession scenario, you don't want to model entering into a new market or making a big investment at the same time. - **Measurable** – You need clear metrics that demonstrate a scenario is materializing. - **Collaborative** – It needs input from multiple departments, not just finance. - **Iterative** – It needs to be updated and refreshed regularly as circumstances change and new information comes in. - **Informative** – It needs to help the whole organization, so it should tell a clear story that guides decision-making. --- [Finance Alliance Salary Report 2025Uncover the truth about what your finance peers are earning and see how your salary measures up with the Finance Alliance Salary Report 2025! 💵![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-69.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Salary_Survey_2025_Meta.png)](https://www.financealliance.io/finance-salary-report/) --- ## **Overcoming common challenges in scenario planning** Implementing scenario planning isn’t always easy. Here are some of the biggest challenges organizations face and how to overcome them: ### **Integration within the financial planning cycle** Scenario planning needs to become an integral part of how you do financial planning. At the same time you’re building your bottom-up financial projections, you need to start sitting with the relevant people you want to involve and think about the scenarios you want to build. You want to have relevant conversations and arrive at outputs that connect to your strategy and financial planning cycle. ### **Leadership buy-in** Some executives resist scenario planning because they only want to hear that their targets are achievable. Therefore, you need to educate leadership on the value of preparedness, how potential scenarios may impact the business strategy, and what changes need to be put in place. ### **Culture and collaboration** You need to bring the right people into your scenario-planning process if you want to make a meaningful impact on your organizational strategy. ### **Resource constraints** Scenario planning takes time and effort, but investing in it upfront prevents costly mistakes later on. ### **Technology** While Excel can work, advanced tools can significantly improve the efficiency and accuracy of your scenarios. At DS Smith, we’re working on enhancing our scenario planning capabilities by integrating new [financial modeling tools](https://www.financealliance.io/10-best-financial-modeling-tools/) to make the process faster and more robust. ## **Final thoughts** If you’re not already incorporating scenario planning into your strategic and financial planning cycle, now is the time to start. The world is unpredictable—markets shift, crises emerge, and new opportunities arise. Companies that proactively prepare for potential futures will always have a competitive edge over rivals that aren’t so agile. *This article is based on a presentation given by Cesar Gomez Nieto, Group Head of Financial Planning and Analysis at DS Smith, at our FP&A Summit, London in 2023\. Catch up on this presentation, and others, using our* [*OnDemand service*](https://www.financealliance.io/ondemand/)*. And for more* [*exclusive content*](https://www.financealliance.io/tag/members-only-articles/)*, check out your* [*membership dashboard*](https://www.financealliance.io/pro-plus-membership-dashboard/)*.* ### Operational Analysts: Why they belong in finance, not IT or business units URL: https://www.financealliance.io/operational-analysts-why-they-belong-in-finance-not-it-or-business-units/ Last updated: 2025-10-08T09:15:02.000Z Operational analysts play a crucial role in transforming raw data into actionable insights that drive strategic decision-making. We are in a data-driven world and having actionable data distinguishes the leaders from the laggards. I am not sure there is really a debate on this topic. At least not for me, but it is worth discussing whether these valuable professionals should be housed within an organization. Placing operational analysts within the finance department offers significant advantages for both the company and the analysts themselves. It makes more sense than distributing analysts across business units or centralizing them within IT. ## **The strategic advantage for organizations** ### Enhanced financial integration and control I have observed that operational analysts who work within the finance department develop a deep understanding of the company’s financial priorities and metrics, and more importantly, they can connect the operational requirements of the business more readily to decision-ready analytics and financial outcomes. This proximity to [financial planning and analysis](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) (FP&A) teams ensures that operational analysis is always conducted through a financial lens, leading to insights directly tied to bottom-line impact. The finance department’s natural focus on ROI, cost management, and [resource allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) means that analysts working within this environment are more likely to prioritise projects and analyses that deliver tangible financial benefits. This does not mean that finance dominates the process, it’s the powerful mix of sensibility over dollars combined with sensibility over the mechanics of the business model. This alignment helps ensure that analytical resources are deployed in ways that maximize shareholder value rather than being consumed by projects with limited financial impact. > **Side note: It also elevates these professionals out of the Excel-jockey persona they can easily fall into without a supportive leadership structure** ### Standardised methodology and governance Housing operational analysts in finance promotes consistency in analytical approaches across the organization. Finance departments typically maintain strict standards for data quality, methodology, and reporting. When analysts operate under these standards, it results in more reliable and comparable analyses across different business units. Also, this centralized approach also facilitates better [data governance and compliance](https://www.financealliance.io/finance-and-compliance/). Finance departments are already well-versed in maintaining audit trails, ensuring data accuracy, and adhering to regulatory requirements. Therefore, these established practices naturally extend to operational analysis, reducing risk and enhancing the credibility of analytical outputs. --- [Data storytelling for FP&AWhat do Barack Obama, Oprah Winfrey, and Nikki Glaser have in common? They all excel in storytelling...and you can do (yes, even as a finance professional!). Here’s how…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-65.png)Finance AllianceMathew Reynders![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--37-.png)](https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/) --- ### Improved resource allocation Organizations that centralise analysts in finance allow for more efficient resource allocation based on company-wide priorities rather than departmental interests. When analysts are distributed across business units, they often become soiled, leading to duplicated efforts and inconsistent methodologies. Similarly, when housed in IT, their focus can shift too heavily toward technical solutions rather than business outcomes. The IT department is also generally suffering from shifting and competing priorities which will inevitably diminish the focus of analysts. In addition, the finance department’s enterprise-wide view enables better prioritisation of analytical resources across competing demands. This positioning allows for more strategic deployment of analytical talent where they can create the most value for the organization. ## **Benefits for the analysts** ### Career development and growth Operational analysts working within finance have unique career development opportunities. Like, exposure to high-level strategic decisions and understanding how their analyses impact the company’s financial performance. This business context is invaluable for analysts who aspire to take on broader business leadership roles. Also, the finance department’s interaction with every aspect of the business also allows analysts to develop a comprehensive understanding of the organization’s operations. Adversely, this broad exposure is often limited when analysts are embedded in specific business units or relegated to IT departments. ### Enhanced impact and visibility Positioning within finance typically provides analysts with greater visibility to senior leadership. Finance departments regularly interact with C-suite executives and board members, creating opportunities for analysts to showcase their work to key decision-makers. This visibility can lead to faster career advancement and greater recognition of their contributions. Furthermore, the finance department’s role in strategic planning means that analyses conducted by these teams often directly influence major business decisions. This level of impact can be highly motivating for analysts and helps attract and retain top talent. ### Professional development and mentorship Finance departments often have well-established professional development programs and clear career paths. Analysts can benefit from mentorship opportunities with experienced finance professionals who will help them develop both technical and business skills. This mentorship is particularly valuable for analysts early in their careers who are still developing their business acumen. Furthermore, the finance department’s emphasis on professional certifications and continuing education also benefits analysts. Many finance departments support and encourage professional development through formal training programs, conference attendance, and certification support. --- [Is your budget timeline holding you back?Tired of waiting for other departments to submit inputs to the budget on time? Here’s a few tricks of the trade to help you prevent this issue and create seamless budget timelines.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-66.png)Finance AllianceChristian Wattig![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--36--2-1.png)](https://www.financealliance.io/budget-timelines/) --- ## **Addressing common concerns** Some organizations worry that housing analysts in finance might disconnect them from the operational realities of business units. However, this concern can be addressed by using a client-service model. The departments have a consultative service in the form of the operations analyst and their managers. Although, others argue that placing analysts in IT allows for better technical support and development. While technical expertise is important, modern analytical tools and cloud platforms have reduced the need for deep technical integration. Finance departments can maintain strong partnerships with IT while keeping the focus on business outcomes. ## **Building a successful model** To maximize the benefits of housing operational analysts in finance, organizations should consider the following best practices in building a [successful business model](https://tirabassi.com/how-a-financial-model-serves-as-your-north-star/): 1. Establish clear service-level agreements with business units to ensure responsive support. 2. Create formal rotation programs to maintain strong connections with operations. 3. Develop structured communication channels between analysts and business unit leaders. 4. Invest in ongoing training to keep analytical skills current. 5. Build strong partnerships with IT to ensure technical needs are met. 6. Implement clear career progression paths for analysts within finance. 7. Above all, the operations analyst should be part of the department’s critical staff and planning meetings. ## **The future of operational analysis** As businesses become increasingly data-driven, the role of operational analysts will only grow in importance. Housing these professionals within finance positions them to deliver maximum value while developing the business acumen needed for career advancement. This organizational structure aligns their analytical capabilities with financial outcomes while providing analysts with the support and opportunities they need to thrive. ## **Frequently asked questions** **Q1: Won’t housing analysts in finance create delays in responding to urgent operational needs?** No, when properly structured with clear service-level agreements and priority frameworks, finance-based analysts can be just as responsive as embedded analysts. The benefit is that their responses will be more consistently aligned with company-wide priorities and standards. **Q2: How can analysts maintain a deep understanding of business unit operations if they’re not embedded in those units?** Through structured rotation programs, regular operational reviews, and formal liaison roles, analysts can maintain strong connections with business units while benefiting from the strategic perspective and standardized approaches that come from being housed in finance. **Q3: What’s wrong with keeping operational analysts in IT since they work with data and systems?** While analysts do work with technical systems, their primary value comes from translating data into business insights. Housing them in IT can overemphasise technical considerations at the expense of business impact. Finance provides a better environment for developing business acumen while maintaining necessary technical partnerships with IT. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2025/02/FP-A_Summit_Dubai_MAY25_Linkedin_Banner_.png) ](https://events.financealliance.io/location/sanjose) ### FP&A Summit January 2025 | OnDemand URL: https://www.financealliance.io/fp-a-summit-january-2025-ondemand-video/ Last updated: 2025-02-20T17:53:29.000Z _This post is for paying subscribers only._ ### Data storytelling for FP&A: Turning numbers into narratives that drive results URL: https://www.financealliance.io/data-storytelling-for-fp-a-turning-numbers-into-narratives-that-drive-results/ Last updated: 2025-10-08T09:15:09.000Z *This article is based on a presentation given by Mathew Reynders, VP of FP&A, Outbrain, at our FP&A Summit, Boston, 2024\. Check out this presentation, and others, using our* [*OnDemand service*](https://www.financealliance.io/ondemand/)*. And for more exclusive content, check out your* [*membership dashboard*](https://www.financealliance.io/pro-plus-membership-dashboard/)*.* Storytelling often gets a bad rap in finance, but it shouldn't. In fact, effective storytelling is one of the most powerful tools for communicating complex financial data in a way that drives decision-making and creates clarity. Too often, finance professionals default to spreadsheets and overwhelming data dumps, neglecting the importance of clarity, structure, and narrative. Let’s explore how you can use storytelling principles to elevate your financial presentations. ## **What do Barack Obama, Oprah Winfrey, and Nikki Glaser have in common?** They all excel in storytelling. Their success in connecting with audiences comes from their ability to clearly communicate messages and ideas. In finance, we can learn a lot from them. Effective communication is essential, yet it is often overlooked. Whether presenting a budget to a board of directors or sharing financial insights with leadership, clear storytelling can make all the difference. These individuals master the art of engaging their audience by keeping things relatable, clear, and focused on the message. The ability to break down complex ideas into easily understandable messages is not limited to public speakers alone. Finance professionals can benefit immensely by simplifying technical data and presenting it in a way that resonates with their audience. --- [Adobe’s strategy for customer journey-based financial planningHow can finance departments truly support business goals? Adobe’s customer journey-centric approach provides a compelling answer to help finance teams move beyond traditional budgeting to embrace a more dynamic, customer-focused model.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-62.png)Finance AllianceParth Kulkarni![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--31-.png)](https://www.financealliance.io/adobes-strategy-for-customer-journey-based-financial-planning/) --- ## **A tale of two presentations** Let me share two contrasting examples from my experience leading FP&A teams. The first presentation was, to be honest, a disaster: ### **Presentation one:** - 47 slides - Sent 15 minutes before the meeting with the CEO and CFO - Key points hidden on slide 44 👉 **Result**: No decisions made, endless follow-ups, and frustration It was thorough, yes, but so overwhelming that we left the meeting with no progress and just more work to do. The sheer volume of data clouded the message, leaving decision-makers unsure of what actions to take. ### **Presentation two:** - Seven slides - Sent a full day before the meeting - Executive summary included 👉**Result**: Finished early, decisions made, clearer outcomes The second approach was drastically different. It was concise, focused, and designed to enable decision-making. By sending the presentation in advance, leadership had time to review the material, which helped streamline the conversation and focus on actionable insights rather than wading through unnecessary details. ## **Why storytelling matters in finance** [Storytelling](https://www.financealliance.io/mastering-data-storytelling/) is not about making up facts or avoiding data; it’s about presenting facts in a structured and compelling way that ensures clarity and focus. The ability to transform complex data sets into a narrative that makes sense is crucial in decision-making environments. Think about it: if you just send a massive Excel file with a dozen tabs, you're not helping anyone understand what the data actually means. Storytelling, however, provides context, clarity, and focus. **Not a smokescreen**: Storytelling doesn’t hide data but clarifies its meaning. **Grounded in facts**: You still need to do the data work and ensure accuracy. **Drives decision-making**: Clear storytelling highlights key insights for informed decisions. --- [Storytelling with Data Visualization Playbook | Finance AllianceDiscover the essential components of a powerful data narrative and learn how to weave them together to create a story that resonates with your audience.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-63.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Storytelling_with_Data_Visualization_Blog_Meta_2.png)](https://www.financealliance.io/storytelling-with-data-visualization-playbook/) --- ## **The problem with data overload** We often think sending exhaustive spreadsheets shows how much work we’ve done. But flooding stakeholders with 47 slides or 15 tabs of data doesn't clarify anything. Instead, it creates confusion. Overloading your audience with excessive details can create confusion and dilute the core message. A common mistake is letting the audience dig for insights instead of guiding them directly to the answers. This data overload can happen when: - There’s uncertainty about the message. - The presenter hasn’t identified the key points. - There’s fear of omitting important details. The solution? Provide clarity by summarizing the most critical points upfront. ## **Keys to effective storytelling in finance** To tell a powerful financial story, you need to start with the end in mind. Consider the decision or action you want your audience to take and shape your narrative around that goal. Knowing your audience is essential—different stakeholders value different levels of detail, so adapt your presentation style to their preferences. Clarity should always be the priority. Summarize the key insights clearly without unnecessary complexity. Rather than overwhelming your audience with raw data, focus on highlighting trends, variances, and patterns that matter most to your message. Visual aids can be powerful but should be used carefully. [Graphs and charts](https://www.financealliance.io/financial-charts-and-graphs/) can clarify complex points but can also confuse if overused. Keep them simple and directly tied to the story you’re telling. ## **Crafting your narrative: A practical approach** Building a strong [financial narrative](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/) starts with identifying your core message. Ask yourself what insight is most critical—are you explaining a trend, justifying a decision, or seeking approval? Once you've defined this, ensure your data directly supports your core message. Be prepared to provide deeper details if requested, but avoid leading with excessive complexity. The structure of your narrative matters greatly. Begin with a high-level summary that frames the discussion. Follow with the most critical insights, explaining their significance and impact. Conclude with clear recommendations or actions that need to be taken based on the data presented. It's also essential to avoid data overload. Present summaries and key metrics rather than exhaustive reports. If additional detail is necessary, consider including it in an appendix rather than the core presentation. This keeps the focus on insights rather than raw data. Lastly, keep your audience engaged by making your message easy to follow. Encourage feedback and tailor your presentation style to suit the audience’s preferences, ensuring the conversation stays productive and focused. --- [6 strategies for FP&A to master scenario planning and risk managementHow FP&A can help the organization prepare for potential outcomes, mitigate risk, and remain resilient and forward-focused.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-64.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight-5.png)](https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/) --- ## **Confidence and trust building** Confidence stems from preparation and clarity. When you present a focused, concise summary of your findings, you position yourself as the expert. Trust is built when: - Data is accurate and clearly presented. - Recommendations are grounded in evidence. - The audience feels their time is valued. Remember, questions and follow-ups are not failures. They are signs of engagement and interest. Each interaction helps you better understand your audience’s preferences and priorities, refining your storytelling for future presentations. ### **Key takeaways for financial storytelling** - Clarity over complexity: Simplify your message. Avoid overwhelming data. - Summarize effectively: Lead with insights, not raw data. - Structure matters: Use clear frameworks with summaries and recommendations. - Confidence is key: Trust your preparation and communicate with certainty. - Drive decisions: Your goal is to support effective decision-making, not just share data. ## **Final thoughts** Next time you're asked to present financial insights, challenge yourself. Can you distill your findings into a concise, compelling narrative? Are you answering the core questions clearly? If so, you're on the path to mastering financial storytelling. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_6.png) ](https://events.financealliance.io/) ### The Financial Revolution: How open banking is disrupting the status quo URL: https://www.financealliance.io/the-financial-revolution-how-open-banking-is-disrupting-the-status-quo/ Last updated: 2025-11-05T14:59:50.000Z The world of banking and finance is on the cusp of a seismic shift, and open banking is leading the charge. This disruptive force is challenging the very foundations of the traditional banking model, paving the way for innovation, competition, and customer-centric experiences. ### **But what exactly is open banking, and why should you care?** Let's dive into this game-changing phenomenon and explore the opportunities it presents. At its core, open banking mandates that banks securely share customer data with authorized third-party providers, fostering an ecosystem of collaboration and innovation. ### **But why the drive for traditional banks to embrace this paradigm shift?** The answer lies in the mounting competitive pressure from fintech companies and non-bank players that have been chipping away at the banking monopoly. By embracing open banking, traditional banks can retain customers by offering integrated experiences with fintech partners and attract new customers through innovative products and services. It also creates new revenue streams by monetizing their data and infrastructure through banking-as-a-service (BaaS) offerings. Moreover, [regulatory compliance](https://www.financealliance.io/finance-and-compliance/) is a driving force, as many jurisdictions introduce open banking regulations requiring banks to share customer data securely. But the true disruptive potential of open banking lies in its ability to democratize finance. By enabling secure data sharing, open banking empowers fintech companies, non-bank entities, and smaller players to create personalized and innovative financial products and services, breaking the monopoly of traditional banks. --- [Is your budget timeline holding you back?Tired of waiting for other departments to submit inputs to the budget on time? Here’s a few tricks of the trade to help you prevent this issue and create seamless budget timelines.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-61.png)Finance AllianceChristian Wattig![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--36--2.png)](https://www.financealliance.io/budget-timelines/) --- Imagine a world where customers enjoy seamless, unified experiences across different providers, eliminating the need to navigate multiple interfaces. A world where they gain control over their financial data, enabling them to easily switch between providers, increasing competition and forcing banks to improve their offerings. Open banking also holds the promise of financial inclusion, opening doors for underserved and unbanked populations to access financial services from non-traditional providers. And with access to a broader range of customer data, providers can develop highly personalized and tailored financial solutions, catering to individual preferences and needs. ### **But how is open banking governed to prevent incumbent banks from simply acquiring potential disruptors?** Open banking frameworks establish governance and oversight mechanisms, promoting fair competition, data security, and consumer protection in the evolving financial landscape. Regulations around data portability, anti-competitive conduct monitoring, and merger and acquisition oversight aim to create a level playing field. As open banking and BaaS offerings converge, we see opportunities for collaboration and integration. Traditional banks can leverage BaaS platforms to offer their services to non-bank companies, while fintech providers can utilize open banking data to enhance their BaaS offerings. This collision could lead to a more open, integrated, and innovative financial services ecosystem, benefiting both consumers and businesses alike. In this era of disruption, open banking represents a paradigm shift that challenges incumbents to adapt or risk being outpaced by nimbler, customer-centric players. It's a revolution that democratizes finance, fosters innovation, and puts the power back into the hands of consumers. Embrace the change or be left behind – the choice is yours. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_3.png) ](https://www.financealliance.io/insider-membership-plan/) ### Is your budget timeline holding you back? Try this. URL: https://www.financealliance.io/budget-timelines/ Last updated: 2025-04-10T07:40:53.000Z Do you know what the biggest challenge is when it comes to budget timelines? It’s that departments tend to wait right before the final deadline to share their inputs with the finance team. Usually, they do this because they prioritize their own tasks and [budgeting](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) can often get sidelined until the deadline looms closer. But that leaves us in finance *scrambling*. We don’t have time to properly review or challenge their numbers, and it ends up squeezing the timeline for consolidating financials and tax work. So, let’s talk about how to avoid this chaos. In this article, I’m going to walk you through the three key principles I’ve found invaluable when setting up budget timelines to prevent this and other issues.👇 ### **1.** **Start early and plan ahead** First, you want to make sure to start early and plan ahead. You’ve got to give yourself (and everyone else) enough time for thorough planning and consideration. Ideally, start three to six months *before* the start of the next fiscal year. Of course, how early you need to start depends on the complexity of your business. Large multinational companies tend to start in August and September, and the fiscal year ends by the end of December. But smaller companies can get the entire budgeting process done within one or two months as well. The most important thing to remember is to plan early and make sure you have everything lined up so the process runs as smoothly as possible. ### **2\. Set clear deadlines and milestones** Deadlines need to be firm—no wiggle room. Make sure everyone understands why they’re in place and gets onboard with sticking to them. It’s a good idea to separate between initial submissions, revisions, and final approvals. Each of these should have a buffer because delays happen. Things can end up taking longer than you plan, no matter how well organized you are. So, adding a day or two here and there can save you from major stress down the road. ![Budget timeline 3 tenets](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/01/Screenshot-2025-01-23-at-10.30.50.png) ### **3\. Involve key stakeholders early** Another crucial piece? Involving [key stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) early. Their leadership is critical for setting realistic and achievable [budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) timelines. Ideally, ask people *before* you share it what they think about it and get their input before you share the budget timeline. Doing this helps to make the process more collaborative from the start. --- [6 zero-based budgeting myths debunkedA zero-based budget (ZBB) is a budgeting method where you allocate every dollar earned to a specific category or expense. You start with a blank slate - zero - each time you budget, rather than tweaking your past budget.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-59.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/zero-based-budgeting-2.jpg)](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/) --- ## **Budget timeline: Getting inputs sooner** A common issue when it comes to budget timelines is that department heads share their inputs at the very last moment. Here's a way that I found helps significantly with addressing that issue and getting budget inputs sooner: ![Budget timeline slide 1](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/01/Screenshot-2025-01-23-at-10.31.11-1.png) [**Source: Budgeting and Forecasting: Certified Course*](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### **Implement a staggered timeline** Urgency drives prioritization. When people have a lot on their plate, they struggle with prioritizing the budget tasks so instead, they prioritize things according to the deadline. It’s not a surprise, really, since deadlines create urgency and urgency is an important driver for prioritization. So, this is why I advise that you implement a staggered budget timeline. A staggered budget timeline has multiple checkpoints. In other words, there are multiple times when you're asking for input rather than waiting until the very last moment. This makes the work more manageable because it's being completed progressively, rather than all at once. ### **Provide training and support** Sometimes, delays occur simply because people don't understand a part of the process, or they don't understand where to get their input from, etc., and you must clarify that information upfront. The best process is to ask people to explain how they understood the process and the deadlines back to you. This will help you quickly identify where the gaps are in the understanding. ![Budget timeline slide 2](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/01/Screenshot-2025-01-23-at-10.31.27-1.png) [**Source: Budgeting and Forecasting: Certified Course*](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### **Regular reminders and check-ins** Regular reminders and check-ins are important throughout the budgeting timeline, especially as deadlines get closer. Sometimes, people are concerned that sending a reminder a day before the deadline can be taken as annoying or too intrusive. But trust me - even senior leaders appreciate a nudge as a deadline approaches. ### **Use incentives and consequences** [Incentives](https://www.financealliance.io/the-culture-is-vibrant-collaborative-intellectually-stimulating/) and consequences can help improve early or on-time submissions. On the other hand, it can also help to establish consequences for late submissions. However, consequences should be used sparingly because you risk damaging the relationship between two colleagues or departments. An example of an appropriate consequence would be sharing what happens when you receive a late submission and what that means for the business as a whole. For example, one late submission could bring the entire budget process to a halt and lead to further delays down the road. ![Budget timeline slide 3](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/01/Screenshot-2025-01-24-at-12.34.41.png) [**Source: Budgeting and Forecasting: Certified Course*](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### **Leverage technology** [Technology](https://www.financealliance.io/how-to-optimize-finance-teams/) can be a lifesaver here. Budgeting software eliminates the hassle of emailing spreadsheets back and forth. With a centralized dashboard, people can enter their data, and you can see updates in real-time. That’s a *huge* time-saver and helps avoid errors and identify bottlenecks early in the process. ### **Involve senior management** As a last resort, if people are just completely ignoring your deadlines and missing them consistently, it might be time to involve senior management. With them involved, it can help reinforce the importance of adhering to the timeline. ![Budget timelines slide 4](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/01/Screenshot-2025-01-23-at-10.31.53-1-1.png) [**Source: Budgeting and Forecasting: Certified Course*](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### **Facilitate collaboration** There are also ways you can [facilitate communication](https://www.financealliance.io/cfos-role-in-investor-communications/) and make it easier for people to communicate. One specific way that you can do this is to set aside a specific time each week when people can drop in (or hop on a Zoom call) with questions. It’s amazing how much smoother things go when people feel they have an open line to you. ### **Build good relationships** At the end of the day, budget timelines run on trust. When people believe you have their best interests at heart and see that you’re an expert who knows what you’re doing, they’re more likely to invest their time and effort into the process. --- [How to turn forecasting & budgeting mistakes into milestonesIn this article, we’ll explore key lessons in implementation processes and corporate strategy, and how you can use them to achieve real, tangible results in your FP&A function. You’ll also discover real-world examples and success stories to inspire and guide your own journey to success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-60.png)Finance AllianceJames Manning![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--9-.png)](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) --- ## **Budget timeline:** **A real-world example** Let me show you what a budget timeline might look like for a medium-sized company: ![Budget timeline example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/01/Screenshot-2025-01-23-at-10.32.11.png) [**Source: Budgeting and Forecasting: Certified Course*](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) As you can see, the schedule starts on November 1 and ends in mid-January. While it’s not ideal for the budget process to extend into January - especially if the fiscal year begins on January 1, as it does here - it’s a reality for many smaller and medium-sized companies. This example illustrates how such a timeline can work. Now, let’s break down how the deadlines are structured. Here is a short video explanation taken from one of the modules of the [**Budgeting and Forecasting: Certified course**](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters): 0:00 /3:26 1× In this example, tasks led by the finance team are marked in blue, submission deadlines are in black, and review stages are in red. The first thing you’ll notice is that there isn’t just one big deadline at the very end. Instead, there’s a first-pass deadline and a second-pass deadline. This staggered approach helps encourage earlier prioritization and provides enough time for iteration. The first deadline is about three weeks after the budget process kicks off - on November 22\. This gives teams enough time to compile their initial “bottom-up” inputs. Once those are submitted, the finance team has about a week to analyze the data before the next leadership review. During this review, the team will likely discuss any gaps between the bottom-up inputs and the “top-down” targets, which represent the company’s overall financial goals. From there, the business needs to address how to close those gaps, as the bottom-up figures often lean too conservative. Two to three weeks later, you have the second-pass deadline. By this point, the hope is that the inputs are closer to aligning with the top-down targets, and the differences can be bridged more easily. Another leadership review follows, where adjustments may be made to finalize the numbers. Depending on the situation, there could be additional passes or iterations, but ideally, the final analysis happens during this phase. Leadership may provide top-down adjustments at this stage, which override earlier inputs. After this final leadership review, the CFO can lock the plan shortly afterward. This timeline highlights the importance of staggered deadlines, as they ensure budgeting starts early, progresses iteratively, and allow enough time for meaningful reviews and adjustments. --- ## **Budgeting and Forecasting Certified Masters** **course** ## Mastering budget timelines is just one part of the bigger picture in budgeting and forecasting. If you’ve ever felt the stress of last-minute submissions, the frustration of misaligned inputs, or the pressure to deliver perfect results with limited time, you’re not alone. And I’ve been there too. That’s why I worked with Finance Alliance to create the **Budgeting and Forecasting Certified Masters** course—to give you the tools, strategies, and confidence to navigate these challenges like a pro. This isn’t just theory; it’s practical, battle-tested advice from someone who’s been in the trenches. In this course, we cover everything from building timelines that actually work to crafting forecasts that lead to smarter business decisions. It’s designed for professionals who want to move beyond the basics and truly excel in FP&A. If you’re ready to take control of your budgeting process and make a real impact in your organization, I’d love for you to join me. [Check out the course here](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters), and let’s get started! [Enrol today](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### 6 strategies for FP&A to master scenario planning & risk management URL: https://www.financealliance.io/6-strategies-for-fp-a-to-master-scenario-planning-risk-management/ Last updated: 2026-03-19T09:40:55.000Z Any organization's financial planning and analysis (FP&A) department is essential. Its main responsibility is to support decision-making and provide financial insights to enable the organization to achieve its strategic goals. To do this effectively, FP&A must ensure that it has a strong focus on **scenario planning and risk management.** ## **Scenario planning best practices** [**Scenario planning**](https://www.financealliance.io/scenario-planning-strategic-forecasting-for-finance-teams/) **is a process that involves identifying and analyzing potential future outcomes for the organization**. It allows FP&A to consider different scenarios and understand how they might impact the company's financial performance. This can be especially useful in times of [uncertainty](https://www.financealliance.io/financial-planning-in-uncertain-times-advice-from-leading-finance-experts/), when traditional [forecasting](https://www.financealliance.io/future-proof-your-forecasting-strategies/) methods may not be as reliable. FP&A can help the organization better prepare for a range of potential outcomes by regularly conducting scenario planning. To ensure greater focus on scenario planning, FP&A should follow these best practices: ### **Involve key stakeholders** Scenario planning should involve input from key stakeholders across the organization. This includes executives, department heads, and front-line employees. By getting input from a diverse group of people, FP&A can gain a more comprehensive understanding of the potential impact of different scenarios. ### **Use data to your advantage** FP&A should gather data from a variety of sources to inform scenario planning. This includes financial data, non-financial drivers, industry trends, customer feedback, and market research. The better quality data that's available, the more accurate the scenarios will be. ### **Regularly update scenarios** Scenario planning should be an ongoing process. As new information becomes available, FP&A should update and refine scenarios to ensure they remain accurate and relevant. --- [How scenario planning can prepare your business for anythingReducing risk and building awareness of what could happen can help you prepare for almost anything. But how does strategic scenario planning work? And how can finance teams use it to future-proof the business? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-55.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/firmbee-com-jrh5lAq-mIs-unsplash-2.jpg)](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) --- ## 3 steps for more effective risk management In addition to scenario planning, FP&A should also have a strong focus on **risk management**. [**Risk management**](https://www.financealliance.io/financial-crime-risk-management-fcrm/) **is the process of identifying, assessing, and mitigating risks that could impact the organization.** By proactively managing risks, FP&A can help the organization achieve its strategic goals whilst minimizing potential disruptions or negative impacts. To ensure a greater focus on risk management, FP&A should follow these best practices: ### **Identify risks** The first step in risk management is to identify potential risks that could impact the organization. This should involve input from key stakeholders across the organization. ### **Assess risks** Once potential risks have been identified, FP&A should assess the likelihood and potential impact of each risk. This will help in prioritizing which risks need to be addressed first. --- [Value creation plan: Uniting FP&A & risk managementIn this blog post (and video), Stefan Gershater, the Director of Risk at Burberry, walks you through the process of collaboration between these two crucial teams to address both internal and external risks, while maximizing value in uncertain times.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-58.png)Finance AllianceStefan Gershater![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/pexels-cytonn-photography-955395-2-2.jpg)](https://www.financealliance.io/value-creation-plan/) --- ### **Mitigate risks** FP&A should collaborate with other departments to identify and implement solutions to manage risks when they've been identified and assessed. This could include implementing new policies and procedures, implementing new controls, or transferring the risk through insurance or other means. By concentrating on these scenario planning and risk management best practices, FP&A can offer the business helpful insights and support to navigate uncertainty and achieve its strategic goals. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/FA_Article_Banners_Assets_5.png) ](https://certified.thealliance.io/course/fpa-certified-core) ### Adobe’s strategy for customer journey-based financial planning URL: https://www.financealliance.io/adobes-strategy-for-customer-journey-based-financial-planning/ Last updated: 2025-01-17T15:00:43.000Z How can finance departments truly support business goals? Adobe's customer journey-centric approach provides a compelling answer to help finance teams move beyond traditional budgeting to embrace a more dynamic, customer-focused model. _This post is for paying subscribers only._ ### Transforming from accounting to FP&A business partnering URL: https://www.financealliance.io/transforming-from-accounting-to-fp-a-business-partnering/ Last updated: 2025-10-30T12:57:44.000Z In an era of rapid change and technological advancement, we'll explore how to transform from accounting to be a strategic [FP&A business partner](https://www.financealliance.io/fp-a-business-partner/). Below are the five transformational strategies to successfully transition into FP&A’s world. - [Building strong business relationships](https://www.financealliance.io/p/6a948b6a-a560-48f0-b763-d688c358b9c9/#1-building-strong-business-relationships) - [Understanding the business](https://www.financealliance.io/p/6a948b6a-a560-48f0-b763-d688c358b9c9/#2-understanding-the-business) - [Harnessing the power of quality data](https://www.financealliance.io/p/6a948b6a-a560-48f0-b763-d688c358b9c9/#3-harnessing-the-power-of-quality-data) - [Delivering business insights](https://www.financealliance.io/p/6a948b6a-a560-48f0-b763-d688c358b9c9/#4-delivering-business-insights) - [Telling an inspiring business story](https://www.financealliance.io/p/6a948b6a-a560-48f0-b763-d688c358b9c9/#5-telling-an-inspiring-business-story) ## 1\. Building strong business relationships > *The first step for FP&A leaders* The foundation of effective FP&A lies in forging robust relationships. Discover how building credibility and trust with various business functions is crucial for the FP&A as a strategic business advisor. - **Cultivate rapport with key departments**: Commercial, IT, Marketing, and more. 🤝 - **Business language made easy**: Enabling cross-team understanding. 📊 - **Be proactive and supportive**: Every interaction matters👍. - **Strengthen bonds beyond formal meetings**: Invite people for a cup of coffee 🍵. - **Show an interest**: Get to know your stakeholders. All of these will help you transform your business relationships to a value-driven communication that will yield positive influence with your surroundings. ### **Impact of strong relationships in business** A recent study by **McKinsey** revealed that companies with strong cross-departmental relationships see a **25% higher increase** in annual revenue compared to their counterparts. Building strong business relationships isn't just good practice, it's **profitable**! When departments align, financial planning becomes **more effective** and drives growth. --- [5-step stakeholder communication planA stakeholder communication plan is a strategic document outlining how a company will communicate with its stakeholders.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-49.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_3_stakeholder_engagement-1.jpg)](https://www.financealliance.io/stakeholder-communication-plan/) --- ## 2\. Understanding the business > *Business acumen is the core* A deep comprehension of your business is the cornerstone of successful [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/). Explore how gaining an in-depth understanding of every aspect of your company powers informed decision-making and strategic guidance. - **Company’s operations and external environment**: Draw your company’s business model 📊. - **Regular strategy talks with senior leaders**: Aligning your vision 🌐. - **Participate in cross-functional projects**: Gain holistic insights 🤹. - **Conduct field visits**: Get to know your customers and suppliers 🧑. ## 3\. Harnessing the power of quality data > *Data matters!* Data is the lifeblood of insightful FP&A. Learn how ensuring the quality and integrity of data can significantly impact the accuracy and relevance of [financial insights and forecasts](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/). - **Quality data equals credible insights**: Quality-in, Quality-out; Garbage in, Garbage out. - **Enhance precision**: Through trend analysis and evidence-backed data. - **Automation and controls**: The key to minimizing errors. ### **Understand the impact of low-quality data** Employees **waste up to 50%** of their time dealing with mundane data quality tasks. Kiss metrics estimate businesses losing **as much as 20% of their revenue** because of poor data quality. --- [The ultimate data cleaning checklist for financeIn this blog, we get into the nuts and bolts of data cleaning techniques. We’ll also provide practical data cleaning steps to help guide you through the process.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-50.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_4_quality_assurance.jpg)](https://www.financealliance.io/data-cleaning-techniques/) --- ## 4\. Delivering business insights > *Beyond just data* Transforming data into actionable insights is an art and a science. Uncover the strategies for providing forward-looking, predictive analyses that can shape the future of your business. - **Transform data into foresight**: What's next for the business? - **Leverage AI and predictive analytics**: For real-time insights. - **Cultivate a data-driven decision-making culture**: It’ll pay out the right way. - **Asking the right questions**: Leverage your business acumen. ### The power of analytics Did you know that companies using **analytics** are **twice** as likely to identify performance gaps and opportunities as those who don't? **Analytics** isn't just about **forecasting**; it's a tool for **uncovering hidden opportunities** and preparing for future challenges. ## 5\. Telling an inspiring business story > *The art of storytelling* Beyond numbers and charts lies **the power of storytelling**. Learn how FP&A professionals can [craft compelling narratives from financial data](https://www.financealliance.io/mastering-data-storytelling/) to inspire and drive strategic business actions. 1. Turn numbers into **narratives** that drive action 📈. 2. Speak the language of **decision-makers**, not just technical jargon 🗣. 3. Use **simple visuals** to make a powerful impact 🎨 Understanding this will not only create a **sense of trust** to your audience, but also makes you more credible when presenting important data. ### Storytelling in financial data Did you know that financial presentations with storytelling are **22% more effective** in conveying complex information than those with just data and charts? Storytelling in finance is more than a trend – it's a **powerful way to communicate** complex data in a relatable and memorable manner, leading to better decision-making. ## Recap: Shorten it up Embark on a transformative journey with these pivotal FP&A strategies. Propel your organization forward in a world where agility, insight, and strategic foresight are key to navigating the complexities of today's business landscape. 🤝 **Building strong business relationships:** Cultivating connections across departments, fostering a collaborative ecosystem for financial and strategic success. 🔍 **Understanding the business:** Developing a comprehensive acumen of your organization’s operations and external influences for informed, strategic guidance. 📊 **Harnessing the power of quality data:** Harnessing accurate and insightful data as the cornerstone of effective FP&A, driving credible and actionable business insights. 🚀 **Delivering business insights:** Transforming data into foresight, using predictive analytics and AI to shape business strategies and outcomes. 📖 **Telling an Inspiring Business Story**: Crafting narratives from numbers, turning complex financial data into engaging, action-driving stories. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_5.png) ](https://certified.thealliance.io/course/fpa-certified-core) ### CFO Summit Speaker Spotlight with Dave Wieseneck URL: https://www.financealliance.io/cfo-summit-speaker-spotlight-with-dave-wieseneck/ Last updated: 2025-01-10T10:18:28.000Z Welcome to another edition of our Speaker Spotlight series, where we introduce you to the inspiring voices taking the stage at our upcoming events. This time, we’re featuring Dave Wieseneck, Ramp’s Expert-in-Residence, who'll be sharing his insights on the panel discussion, 'Deploying AI in Finance - Balancing Innovation and Compliance' at the CFO Summit in San Jose (27th February 2025). AI implementation in the financial sector is no small task, particularly in heavily regulated environments. Dave, alongside other industry leaders, will explore the complexities, challenges, and strategies for integrating AI solutions while ensuring strict regulatory compliance. As a seasoned finance professional with a wealth of experience, Dave offers valuable perspectives on balancing technological innovation with risk management. We recently had the chance to ask Dave about his journey in the finance industry, his advice for aspiring finance professionals, and what he believes is the future of AI in the financial world. Read on to gain valuable insights from one of the thought leaders shaping the future of finance.👇 [Register to join the CFO Summit](https://cfoevents.financealliance.io/location/cfosanjose/register) ### **Can you tell us about yourself and your role at Ramp?** I’m [Dave Wieseneck](https://www.linkedin.com/in/davidwieseneck/), Ramp’s first Expert-in-Residence. I’ve spent my career building finance teams at tech startups, focusing on creating scalable processes, optimizing workflows, and leveraging technology to drive efficiency. At [**Ramp**](https://ramp.com/), I oversee our internal use of the product, ensuring we’re our own best customer. I also work closely with customers and product teams to align Ramp’s roadmap with the needs of modern finance teams. Here is a blurb we use on the website: > *"With 15 years of experience as a finance operator and advisor across 7+ fast-growing tech startups, David's career has rallied around one core purpose: building high-performance teams that scale operations with cutting-edge technology.* > *Having previously ran the finance teams at Demostack, letgo, & Ollie Pets & as an advisor for Carta, Justworks, Navan, and Ironclad, he now serves Ramp as their first-ever Expert-In-Residence.* > *David implemented Ramp with three past companies, making him a seasoned authority in their products and workflows. Today, he leads the team by shaping user experiences, both internally and customer-facing, with a unique curiosity and passion for building the future of financial technology."* --- [7 steps of the finance transformation journeyWhat does the finance transformation journey look like? In this article, you’ll learn about the key drivers, challenges, and opportunities that come with navigating this journey.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-47.png)Finance AllianceGabriela Suchanek![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Stock--6--2.png)](https://www.financealliance.io/7-steps-of-the-finance-transformation-journey/) --- ### **What are some of the challenges Ramp faces in their financial planning? And how are you planning to overcome them?** As a rapidly growing company, one of our biggest challenges is maintaining accurate and agile forecasting while scaling. Growth brings frequent changes—whether it’s in headcount, objectives, or market conditions—and these shifts can quickly make traditional [FP&A processes](https://www.financealliance.io/business-process-optimization/) feel outdated. For example, department ownership and reorgs occur multiple times a year as we adapt to new opportunities. This means budget and vendor ownership often changes hands, requiring us to constantly adjust how we partner with the business. Flexibility is critical, both in how we build financial models and how we report to leadership and the board. At this stage, locking into a rigid process simply isn’t an option. We even tried implementing an FP&A platform, but ultimately found the setup too heavy and the tool, while powerful, too constraining for our needs. For now, staying nimble and leveraging adaptable solutions is how we ensure our financial planning keeps pace with our growth. ### **What trends do you foresee in finance over the next few years?** The biggest trend is the acceleration of automation and [AI in finance](https://www.financealliance.io/ai-in-finance-ebook-download/). Finance teams are moving away from transactional tasks and toward strategic advisory roles. Ramp is preparing for this shift by building tools that eliminate busywork, provide real-time insights, and empower teams to focus on high-impact decisions. ### **Why are assemblies of the finance community, like CFO Summit San Jose, so important?** These gatherings are invaluable for exchanging ideas, building connections, and staying ahead of industry trends. ![Speaker spotlight with Dave Wieseneck](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/01/5.png) Some of my closest relationships are borne from events like these—I usually don’t realize it at the time, but there is high long-term ROI on the connections you make at in-person events & online communities. ### **What's your favourite finance resource that you would recommend to others?** - OnlyCFO & SecretCFO are amazing blogs & Twitter/LinkedIn follows - Dave Kellogg & Jason Lemkin are some OGs I follow - Excel TikTok is great to learn new formulas & tips/tricks - ChatGPT for helping me figure out how to debug crazy long formulas --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_6.png) ](https://events.financealliance.io/) --- ### **What's your favorite financial anecdote or story that you've learned over the years?** I’ll give you three: **1\. Building relationships** Early in my career, I worked on a budget with a department head (CTO) who initially seemed resistant to Finance’s involvement, thinking that I wanted to just cut costs & reduce the headcount. He came to the table with some aggressive hiring plans & a hefty expansion of the tech stack; my approach was to be more conservative & build in some gating to that growth. Instead of approaching it as a negotiation, I focused on understanding their challenges. By the end, we not only built a more realistic budget but also found ways to reallocate resources that made more sense for the business & for his department. It taught me that finance is as much about building relationships as it is about numbers. **2\. Eliminating an unnecessary expense** During a routine review, I noticed an unusual recurring expense for a software tool (let's call it "RogLocket"). When I asked the team about it, nobody could recall why we’d started using it. It took a few days of asking around, searching through emails, & even calling them up to ask them to send us emails from some team members that were no longer at our company. It turned out the tool was part of a pilot program from years ago that no one followed up on. By questioning it, we eliminated a significant unnecessary expense and freed up both cash & tech debt in our code. **3\. Cutting expenses with help from Ramp** One of my fave tweets was from a CEO who decided to terminate all his Ramp cards & just see who screamed. He ended up spinning up a bunch of new cards for his team that needed those services, but was able to cut his expense by 50%, because it turned out a bunch of SaaS was just on auto-renew & no one was paying attention enough to shut those cards off. I feel like we should all do this at least once a year - Finance teams should be scrutinizing recurring expense at least quarterly to ensure proper ownership & continued need. ### **What advice would you give to young professionals starting out in the finance industry?** Focus on building relationships and understanding the big picture. Finance doesn’t exist in a vacuum—every decision you make impacts other teams and vice versa. ![Speaker spotlight with Dave Wieseneck](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/01/2-1.png) ### **If you could give your younger self one piece of career-related advice, what would it be?** Don’t shy away from digging deep into an issue and understanding the “why” behind it. Question things instead of taking them at face value—you’ll often discover that a decision was made long ago, and no one actively owns it anymore. In many cases, inertia is the only thing keeping it in place. Use that as an opportunity to step in, take ownership, and drive meaningful change. That willingness to challenge the status quo and lead will set you apart and open up new opportunities. --- ## Join the CFO Summit San Jose! Break free from the daily grind and join us at the CFO Summit in San Jose on February 27, 2025. CFO Summit is an exclusive, invite-only gathering of senior finance leaders who come together to share success stories and industry insights to work through the prevailing challenges facing CFOs today. - Pick the brains of seasoned decision-makers to hone your financial strategy. - Revitalize and find inspiration by taking a break from the daily routine. - Absorb knowledge from leading CFOs and understand market-shifting trends. - Unite with your peers and establish new connections. [Register to join the CFO Summit](https://cfoevents.financealliance.io/location/cfosanjose/register) ### How to optimize capital deployed for sustainable growth URL: https://www.financealliance.io/how-to-optimize-capital-deployed-for-sustainable-growth/ Last updated: 2025-04-10T07:47:30.000Z What's the difference between a business that thrives and one that stalls? 🤔 The answer is almost *always* smart capital management, specifically how that capital is deployed. Spend wisely, and your business survives and grows. Spend carelessly, and you risk failure. If you're in finance, you know that tracking every dollar is essential. However, simply knowing where your money goes isn't enough. To truly drive growth, you need to master the art of strategic capital deployment. Our guide will help you to optimize the capital deployed and help transform your financial strategy into a powerful catalyst for real business growth. --- ### **Topics covered:** - [The meaning of 'capital deployed'](https://www.financealliance.io/p/64ceaa96-8082-40ce-ba23-393a93ab8c9a/#what-does-capital-deployed-mean) - [Why you should care about optimizing it](https://www.financealliance.io/p/64ceaa96-8082-40ce-ba23-393a93ab8c9a/#why-should-you-care-about-optimizing-capital-deployed) - [How to calculate deployed capital](https://www.financealliance.io/p/64ceaa96-8082-40ce-ba23-393a93ab8c9a/#how-do-you-calculate-capital-deployed) - [Optimization strategies](https://www.financealliance.io/p/64ceaa96-8082-40ce-ba23-393a93ab8c9a/#strategies-to-optimize-capital-deployment) - [Mistakes to avoid](https://www.financealliance.io/p/64ceaa96-8082-40ce-ba23-393a93ab8c9a/#don%E2%80%99t-make-these-common-mistakes%E2%80%A6) - [FAQs](https://www.financealliance.io/p/64ceaa96-8082-40ce-ba23-393a93ab8c9a/#faqs) - [Download your free capital deployment checklist](https://www.financealliance.io/p/64ceaa96-8082-40ce-ba23-393a93ab8c9a/#download-your-free-capital-deployment-checklist) --- ## **What does capital deployed mean?** Capital deployed refers to the money used to run and grow a business. This includes funds invested in equipment, inventory, projects, operations, and other business activities that are meant to generate returns. Make sure you don't confuse capital deployed with capital raised. Capital raised is about getting the money in—through loans or selling equity. Capital deployment, on the other hand, is about what you *do* with that money - how you allocate it and use it to grow the business. You can gain deeper insights by focusing on some key metrics associated with capital deployed like: - **Return on Capital Employed (ROCE):** Measures profitability relative to the capital used. - **Weighted Average Cost of Capital (WACC):** This metric represents the average rate of return required by all investors. - **Asset Turnover Ratio**: This one indicates how well a company uses its assets to create revenue. --- [Multiple on Invested Capital (MOIC): Definition & guideIn this article, we’re zeroing in on MOIC to uncover what it is, its role in private equity, and more importantly, how you can use it to sharpen your investment evaluation skills.r![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-45.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_2_capital_allocation.jpg)](https://www.financealliance.io/multiple-on-invested-capital-moic/) --- ## **Why should you care about optimizing capital deployed?** Poor capital deployment is a major drain on profitability and growth potential. But do it right, and you'll: - Keep cash flowing and make sure there’s enough [working capital](https://www.financealliance.io/10-structured-capital-strategies/) to cover short-term obligations. - Run a tight ship and say goodbye to money-burning projects. - Fund your next big move with strategic expansion. - Make investors happy and keep shareholders coming back for more. ****Bottom line:** The better you manage capital deployed, the greater your competitive edge. ## **How do you calculate capital deployed?** There's no single magic formula because it depends on what you're counting as "deployed." Generally, it refers to the total amount of money a company has invested in its operations, assets, and projects. So, you might look at things like: - **Fixed assets:** Property, plant, and equipment (like buildings, machinery, etc.) - **Working capital:** Money used for day-to-day operations (like inventory, and accounts receivable). - **Investments:** Money put into other companies or financial instruments. Basically, if the money has been spent to further the business, it can be considered deployed capital. ## **Strategies to optimize capital deployment** Instead of playing it safe, optimizing capital deployment is about playing it smart. This involves deploying capital in a way that directly supports the company’s long-term goals. Here’s how you can make that easier: **1\. Align capital with strategic objectives** Every dollar should fuel your company's goals. If an investment isn't driving your mission forward, consider cutting it. **2\. Balance risk and return** Taking on too much risk can put your capital in danger, but being too cautious can hold back innovation. Finding the right balance is crucial when you're using capital to grow your business. **3\. Maximize asset utilization** Every piece of equipment, property, or investment should be earning its keep. Dormant assets show that some of your capital deployed isn't being used effectively - it's wasted. Now, let’s move on to more tactical strategies. Here are a few tips to help ensure your capital deployed drives growth you can measure. ### **Let data drive your decisions** Using good [financial management tools](https://www.financealliance.io/10-best-financial-modeling-tools/) gives you a much better handle on how your company's money is being used. By looking at the right data, you can quickly spot which assets aren't performing well and find better places to invest that money instead. This makes it easier to make quick decisions because you can actually *see* how well different parts of your business are doing. ### **Introduce new capital budgeting techniques** Capital [budgeting](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/) is an easy way to evaluate which [business investments](https://www.thetimes.com/business-money/economics/article/does-britain-really-need-to-expand-venture-capital-investment-tm7h58l7z?utm%5Fsource=chatgpt.com) make the most sense for your company. It helps you make smarter decisions about where to put your money by looking at potential returns and checking if they match what your company wants to achieve. Without good capital budgeting, you might end up wasting money on projects that don't pay off. There are three main tools that make this evaluation process easier: - First, Net Present Value (NPV) shows you if a project will add value to your company - if it's positive, that means the project is worth pursuing. - Next is the Internal Rate of Return (IRR), which gives you a clear measure of how profitable an investment might be. - Thirdly, the Payback Period tells you exactly how long it will take to recover the money you put in. --- [Cash runway calculator (plus 5 tips to extend your cash runway)Discover five strategies to improve your cash runway and ensure business continuity. Plus, we’ve included a free cash runway calculator to quickly determine your company’s cash runway.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-46.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--5-.png)](https://www.financealliance.io/cash-runway-calculator/) --- ### **Benchmark your performance** Comparing your company to others in your industry is key. Seeing how successful competitors are using their resources can reveal what works and highlight areas for your own improvement. By benchmarking your performance against industry standards—looking at how they use their assets and the returns they achieve—you can identify inefficiencies and make smarter decisions about how to deploy capital. ### **Divestment and reallocation** It's important to keep an eye on assets that aren't performing well and move that money to better opportunities. Don't let your money sit around in parts of the business that aren't giving you good returns. Sometimes, you'll need to make tough decisions like selling off parts of the business that aren't essential, getting rid of old inventory, or stopping projects that don't fit your goals anymore. When you free up money from these changes, you can reallocate that capital deployed to areas that have better chances of growing and making more profit. This might mean expanding your business into new markets or creating new products. ### **Debt vs. equity management** Finding the right balance between using debt and equity to fund your business is crucial for growth. Taking on too much debt can be risky because you'll have to keep up with interest payments, which can strain your cash flow. On the other hand, if you rely too heavily on equity financing by selling shares, you'll end up with less control over your company and lower earnings per share. As a finance leader, your goal should be to use debt wisely when interest rates are low to help your business grow, while still protecting the value of your shareholders' investment. It's important to regularly check if your financing approach is working and make sure you're not taking on too much debt. > *Strategic shifts in capital deployed can unlock new growth opportunities when aligned with data insights and market needs.* ## **Don’t make these common mistakes…** When you're trying to make the most of your company's money, there are some common mistakes you'll want to avoid. First, be careful *not* to take on more debt than you can handle - this can limit your ability to run your business effectively. Another big mistake is not investing enough in things your business needs to grow, like developing new ideas or hiring good people. It's also important to keep track of how well the capital deployed is actually working. Many businesses fail because they don't properly monitor their financial performance. The best way to avoid all these problems is to make decisions based on real data rather than gut feelings. --- ## **FAQs** What does "deployed" mean in finance? In finance, "deployed" means putting money to work through investments expected to generate returns. It's about strategically using capital, not just holding it. "Deployed capital" simply refers to money that has been invested. What does "assets deployed" mean? "Assets deployed" is similar to "capital deployed" but focuses on the specific assets acquired with that money. Instead of just the total investment amount, it refers to the actual things purchased, like buildings, machines, and inventory. What is the capital deployment phase? The "capital deployment phase" is when a company actively invests capital to grow the business. What is the cost of capital deployed? The cost of capital deployed is the cost to the company of obtaining the invested funds, including interest on debt and the cost of equity (giving up a share of future profits to shareholders). How do companies raise capital externally? Companies raise external capital primarily through debt (loans, bonds) or equity (selling shares). --- ## Download your FREE capital deployment checklist This checklist covers the key steps to ensure every dollar is working hard to drive growth and efficiency. From checking current spending to using data to make smarter decisions, it's a clear roadmap for boosting financial performance and maximizing returns. Great for building smarter capital strategies! (Download for free below👇) ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2025/01/Title-page-option-1-1.png) [FREE capital deployment checklistOur free checklist to help you optimize capital deployment.FREE Capital Deployment checklist.pdf16 MBdownload-circle](https://www.financealliance.io/content/files/2025/01/FREE-Capital-Deployment-checklist.pdf "Download") --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_5.png) ](https://certified.thealliance.io/course/fpa-certified-core) ### Cash runway calculator: 5 proven ways to extend your cash runway URL: https://www.financealliance.io/cash-runway-calculator/ Last updated: 2025-04-07T09:48:33.000Z ## **What does cash runway mean in business?** Cash runway is the amount of time your company can sustain itself, based on two key factors: **💵 Cash reserves:** The total amount of liquid cash the company has on hand. **🔥 Burn Rate:** The rate at which the company spends its cash. This is usually calculated as the monthly difference between cash expenses and cash revenues. A longer cash runway gives you more options and better financial choices. So, how can you make your company's cash last longer? Below, you'll discover five strategies to improve your cash runway and ensure business continuity. Plus, we’ve included a free cash runway calculator to quickly determine your company’s cash runway.👇 ## How to calculate your cash runway To calculate your company's cash runway, you need to know what your **current cash balance** is. You'll find this in yourcompany’s balance sheet. Next, calculate your **monthly net burn rate**, which is the difference between your total cash outflows (operating expenses like salaries, rent, and utilities) and your cash inflows (typically revenue from operations). **Cash runway formula:** > Cash Runway (in months) = Current Cash Balance / Monthly Net Burn Rate ## Cash Runway Calculator Cash Balance ($): Monthly Burn Rate ($): Calculate Runway --- ## 5 tips to extend your cash runway ### **1\. Cut non-essential costs** One of the easiest ways to free up cash fast is by eliminating unnecessary expenses. So, start looking for areas to cut back like canceling subscriptions to under-used tools, and reducing [budgets](https://www.financealliance.io/budget-vs-annual-operating-plan/) for team outings, and non-critical office supplies (*does your company really need all that branded stationery?*). If you're stuck on what to cut, do a cost audit. It'll show exactly where your money goes so you can separate the must-haves from the extras. Prioritize spending that [drives revenue](https://www.financealliance.io/chief-revenue-officer-vs-chief-financial-officer/) or helps your business expand. ### **2\. Negotiate better terms with vendors** Take a closer look at your company’s vendors and spot areas for improvement. Search for opportunities to [renegotiate payment terms](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/) with suppliers. You want to see if you can secure longer payment periods (e.g., 60 days instead of 30) to help extend your cash runway. This gives you more time to generate revenue and collect payments from customers. By cutting costs and delaying payments, you can stretch your company’s resources further and avoid needing quick cash infusions. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_6.png) ](https://events.financealliance.io/) --- ### **3\. Increase revenue with quick wins** If you want to see cash in your metaphorical pockets sooner rather than later, [boosting revenue](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/) is the way to go. It's a faster way to get liquid *without* having to slash expenses or ask for loans. Here are a few ideas for some quick wins: - Launch some flash sales or special offers to get people excited and buying more. - Suggest some add-ons or related products to your existing customers. They already trust you, so they're more likely to say yes. - Offer discounts for paying upfront or sign them up for subscriptions to get cash flowing in faster. When you bring in revenue quickly, it directly boosts your operating funds. This lets you keep things running smoothly without major changes to how you operate. ### **4\. Secure short-term financing** Short-term financing refers to any loan or credit facility with a repayment period of less than one year. This type of financing is useful for addressing immediate funding needs, [managing cash flow](https://www.financealliance.io/cash-flow-drivers-in-a-business/) fluctuations, and acquiring relatively low-valued but important assets and/or opportunities. Here's how to do it: - **Get a line of credit or a short-term loan**: This gives you access to cash when you need it. - **Use invoice factoring**: Get paid upfront for your invoices instead of waiting for customers to pay. - **Talk to your vendors**: See if they'll give you more time to pay or offer financing options. The big win? Short-term financing gives you breathing room. You can focus on fixing things without having to shut down your business. ### **5\. Shift focus to high-margin products or services** To extend your cash runway, focus on the products or services that make you the most money. These have higher profit margins, so each sale contributes more to your bottom line. First things first, figure out which products or services make you the most money. Once you know your top earners, make sure everyone's working together to use resources wisely and market them effectively. Over time, you can gradually phase out or de-emphasize the products that aren't making you much money or are even losing you money. --- ## Common FAQs #### What is an example of a cash runway? If a company has $600,000 in cash reserves and a monthly burn rate of $50,000, the cash runway is 12 months. #### What is the difference between cash runway and burn rate? Burn rate is the amount of cash a company spends per month whereas cash runway is the number of months a company can continue operating at its current burn rate before running out of cash. #### What is a healthy cash runway? A healthy cash runway typically ranges from 12 to 18 months, depending on the company's stage and industry. #### How much cash runway should a company have? A company should aim for at least 6-12 months of cash runway, with startups often requiring closer to 12-18 months to allow time for growth or funding. #### How do you calculate cash runway in months? Cash Runway = Cash Reserves ÷ Monthly Burn Rate For example, if a company has $500,000 in cash and spends $50,000 per month, the runway is 10 months. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_5.png) ](https://certified.thealliance.io/course/fpa-certified-core) ### 7 steps of the finance transformation journey URL: https://www.financealliance.io/7-steps-of-the-finance-transformation-journey/ Last updated: 2026-03-11T11:22:06.000Z *\[This article is based on a presentation given by Gabriela Suchanek, the Local CFO at Teads and moderated by Premal Parekh, Finance Director/ Divisional CFO at the London Stock Exchange Group at our virtual FP&A Summit in 2023\. Catch up with this presentation, and others, using our* [*OnDemand service*](https://www.financealliance.io/ondemand/)*. For more exclusive content, visit your* [*membership dashboard*](https://www.financealliance.io/pro-plus-membership-dashboard/)*.\]* Finance transformation is no longer just an option; it’s a necessity for businesses that want to stay competitive and agile. But what does the finance transformation journey look like? In this article, you'll learn about the key drivers, challenges, and opportunities that come with navigating this journey. So, if you're looking to understand how to embrace change, overcome roadblocks, and unlock the full potential of your finance team, keep reading - you’ll walk away with actionable insights to drive transformation in your organization. ## Start with the "why" The first step in any transformation is understanding your purpose. Why does your business need this change? Are you trying to reduce costs, improve efficiency, or adopt new technology to automate repetitive processes? Without clarity on the “why,” it’s impossible to define the right scope or measure success. At Teads, when we looked at transformation, we always started with that big question: *Why does this change matter?* Once you know the answer, everything else starts to fall into place—your priorities, your goals, and how you’ll measure success. ## Finance & business transformation go hand-in-hand [Finance transformation](https://www.financealliance.io/what-is-finance-transformation/) doesn’t happen in isolation—it’s deeply tied to broader business transformation. Sometimes it’s a top-down initiative led by leadership, but often, it’s a bottom-up effort where employees identify inefficiencies and suggest improvements. Both approaches work, but the key is ensuring alignment between finance and the rest of the business. For instance, if your finance team is [optimizing forecasting processes](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/), that work should complement broader business goals like improving strategic decision-making or scaling operations. Finance transformation is most impactful when it drives value across the organization—not just within the finance function. --- [How accountants can seamlessly transition into FP&AHere’s a very important question for you: Have you ever looked up from your numbers and wondered what it would be like to shape the financial future of a company, rather than just minding its past?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-43.png)Finance AllianceCarolina Lago![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--23-.png)](https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/) _This post is for paying subscribers only._ ### TOP 10 essential FP&A skills to add to your CV in 2025 URL: https://www.financealliance.io/top-10-essential-fp-a-skills-to-add-to-your-cv-in-2025/ Last updated: 2026-03-11T09:40:07.000Z In this article, we'll discuss the top 10 essential [FP&A skills](https://www.financealliance.io/top-10-fp-a-skills-to-master/) that you should add to your CV in 2025 in order to stay ahead of the curve. ### **1\. Financial modeling** Creating and manipulating [financial models](https://www.financealliance.io/10-best-financial-modeling-tools/) using software such as Excel or planning tools is an essential skill for FP&A professionals. These models can be used to forecast future financial performance, assess the impact of business decisions, and identify trends and patterns in financial data. ### **2\. Budgeting, forecasting and management reporting** Creating and managing budgets, including forecasting, monitoring, and reporting on financial performance. ### **3\. Data analysis** The ability to collect, organize, and [analyze large amounts of financial data](https://www.financealliance.io/chatgpt-for-excel/) to identify patterns, trends, and insights. ### **4\. Data visualisation and data storytelling** Using tools such as excel, PowerPoint, Power BI and tableau to visualize data. And also effectively communicate the story and insights behind the numbers. ### **5\. Strategic planning** FP&A professionals should be able to contribute to the development of long-term financial plans and strategies that align with the overall goals of the organization. --- [Transferable FP&A skills that open doorsDid you know that you can leverage transferable skills in FP&A (financial planning & analysis) to shape the career (and life) you truly want? Whether you love your job or find yourself itching for something new, transferable skills can open up career paths you might not have considered.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-42.png)Finance AllianceJody Salbo![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--21--2.png)](https://www.financealliance.io/transferable-fp-a-skills-that-open-doors-way-beyond-finance/) --- ### **6\. Communication and collaboration** FP&A professionals should be able to effectively communicate financial information to a wide range of stakeholders, including executives, managers, and external partners. They should also be able to work effectively as part of a team and [collaborate with other departments](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) to ensure that financial plans and strategies are aligned with the overall goals of the organization. ### **7\. Adaptability and continuous learning** The business landscape is constantly changing, and FP&A professionals should be able to adapt to new situations and technologies. This includes the ability to continuously learn and develop new skills to stay current in the field. ### **8\. Problem-solving** The ability to identify problems, gather and analyze information, and develop and implement solutions. ### **9\. Leadership** Being able to inspire and guide others, as well as make tough decisions and take calculated risks. ### **10\. Risk management** Being able to identify, assess, and mitigate financial risks to an organization. In conclusion, the FP&A function is rapidly evolving. By mastering the above skills, you can stay ahead of the competition and make yourself more valuable to employers. --- ## FP&A Certified: Core Ready to improve your financial planning and analysis (FP&A) skills and skyrocket your career growth? Our FP&A course is your gateway to mastering the skills and know-how needed to drive strategic business growth with the power of FP&A. - Gain an all-in-one, in-depth understanding of financial planning and analysis. - Get practical tools for real-world applications that you can put into action immediately. - Build effective FP&A processes, providing a solid foundation for effective financial planning, insightful analysis, and data-driven decision-making. [Get certified](https://certified.thealliance.io/payment?product%5Fid=fpa-certified-core) ### How accountants can seamlessly transition into FP&A URL: https://www.financealliance.io/how-accountants-can-seamlessly-transition-into-fp-a/ Last updated: 2025-10-15T13:08:59.000Z Here’s a very important question for you: Have you ever looked up from your numbers and wondered what it would be like to shape the financial future of a company, rather than just minding its past? If you're an accountant feeling the itch for a more strategic role, transitioning into [Financial Planning and Analysis](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) (FP&A) might be your next big move. No, one role is not more important than the other. We need *both* to guarantee the success of a company. While accounting provides a solid foundation in finance, FP&A takes it a step further by focusing on forecasting, budgeting, and guiding business decisions. So why not having the best of both worlds? Many of the skills you've honed as an accountant are directly transferable - and highly valued - in FP&A roles. You just need to value yourself better! ## **Understanding the FP&A role** So, what exactly does an FP&A professional do? In simple terms, they analyze financial data to help businesses plan for the future. But a good FP&A professional is involved in so much more than that. Unlike accounting, which looks at historical data to ensure accurate reporting, FP&A is forward-looking. They are the ones that hold the past, present and future in their hands, or within their analysis. Where the company has been, where it’s standing now and where it’s going. Think of accounting as reading a company's autobiography, while FP&A is helping to write its next chapter. Both are crucial, but FP&A allows you to be part of the [storytelling process](https://www.financealliance.io/storytelling-with-data-visualization-playbook/), influencing where the company goes next. However, it’s not hard to find professionals that call themselves FP&A and are unable to hone the past storyline to drive the narrative into the future. These are professionals that are not familiar with the intricacies of accounting. They cannot interpret the past well. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-34.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FP-A-career-salary-and-path-2-3.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## **Transferable skills from accounting to FP&A** As an accountant, you've already got a toolkit shining with valuable skills: ### **Financial acumen** Understanding the financial statements is critical. FP&A professionals need to know how to interpret income statements, balance sheets, and cash flow statements, knowing well their connections and understanding the impact of every transaction in each of the statements. They need to understand the plot where the company finds itself, in order to write the future chapters. ### **Attention to detail** Spotting discrepancies and ensuring accuracy are second nature to you. This precision is vital when developing forecasts and budgets that the company will rely on. ### **Analytical skills** You've spent countless hours analyzing numbers to understand what they mean. In FP&A, you'll dive even deeper, looking for trends and insights that can inform strategic decisions. ### **Technical proficiency** Familiarity with financial software and Excel is a must. Your experience with accounting systems can give you a leg up when learning FP&A tools like Hyperion or SAP. --- ## **Bridging the knowledge gap** While many skills overlap, FP&A does require a few additional competencies: ### **Strategic thinking** Start by getting involved in strategic discussions at your current job. Offer to help with budgeting processes or [financial modeling projects](https://www.financealliance.io/10-best-financial-modeling-tools/). You will find that many patterns from the past repeat themselves into the budget. That’s where your knowledge is invaluable. ### **Advanced analytics** Consider taking courses in data analysis or business analytics. Financial modeling can serve as a great bridge between accounting and FP&A. When you learn how to model projections based on historical financial results you are exponentially increasing the value of your experience. ### **Communication skills** FP&A roles often involve [presenting findings to non-financial stakeholders](https://www.financealliance.io/stakeholder-communication-plan/). Practice simplifying complex financial concepts. Understand and learn to explain scenarios. Start working on the storyline, beginning in the past (accounting and building up in the future (projections and FP&A) [Networking](https://www.financealliance.io/11-networking-in-finance-tips/) can also play a significant role. Join professional groups, attend industry conferences, or find a mentor already working in FP&A. These connections can provide insights and open doors. --- [17 finance business processesEffective and streamlined finance business processes keep companies running smoothly. They’re vital for sound financial management, which is essential for a company’s success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-35.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/industries-4327631_1280.jpg)](https://www.financealliance.io/17-finance-business-processes/) --- ## **Leveraging past experience** When updating your resume, highlight projects where you've done more than just number-crunching. Accountants are usually involved in multiple projects in the company, whether for contributing with solutions or just booking journal entries. Did you contribute to cost-saving initiatives? Were you involved in budgeting processes? Use specific metrics to showcase your impact, like "*Implemented a new reconciliation process that reduced closing time by 20%*." Even if you were just booking journal entries, making sure you understood the impact of your entries will give you some insights on how to demonstrate that participation in the project. Give yourself some credit. In interviews, be prepared to tell your story. Explain why you're passionate about moving into FP&A and how your accounting background makes you uniquely qualified. Employers appreciate candidates who are self-aware and driven. ## **Addressing challenges** Switching careers isn't without its hurdles. You might face skepticism about your lack of direct FP&A experience. Counter this by emphasizing your willingness to learn and adapt. Share examples of how you've successfully taken on new challenges in the past. Remember, every professional faces learning curves when making a transition. Transitioning from accounting to FP&A can be a natural progression for many finance professionals. Your accounting experience has given you a strong foundation; now it's about building on it to take a more strategic role in shaping a company's future. You will be a very complete professional if you understand how to make this leap smoothly. I hope you're ready to move from recording history to making it. I’m sure you have more qualifications already than the most experienced FP&A professionals, so start taking those steps today. Seek out opportunities, invest in learning, and don't underestimate the value you already bring to the table. I’m cheering for you!! --- ## Make the career change easier with FP&A Certified: Core Learn to forecast, budget and turn complex data into insights that drive profitable business growth. Our FP&A course is your gateway to mastering the skills and know-how needed to drive strategic business growth with the power of FP&A. This course is your comprehensive guide to mastering FP&A, including insights, case studies, and practical templates you won't find elsewhere. So, if you want to make a big change to your career, you know where to start... [Discover more](https://certified.thealliance.io/course/fpa-certified-core) ### How to gain and sustain CEO sponsorship URL: https://www.financealliance.io/how-to-gain-and-sustain-ceo-sponsorship/ Last updated: 2025-04-10T07:46:35.000Z *\[This article is based on a presentation given by Kishor Harsiani at our FP&A Summit, London in 2023\. Catch up with this presentation, and others, using our* [*OnDemand service*](https://www.financealliance.io/ondemand/)*. For more exclusive content, visit your* [*membership dashboard*](https://www.financealliance.io/pro-plus-membership-dashboard/)*.\]* Obtaining CEO sponsorship is not just about securing approval. It’s about building a partnership, adding value, and earning trust. Over my years in finance leadership roles, I’ve learned that success in this arena requires a blend of preparation, strategic alignment, and clear communication. In this blog post, I’ll share some insights and practical strategies to help finance professionals, especially CFOs and FP&A teams, gain and sustain CEO sponsorship. --- ### **Topics covered:** - [Understanding CEO sponsorship](https://www.financealliance.io/p/b8619fbf-6bc6-4c32-8bf1-50f03245e74a/#understanding-ceo-sponsorship) - [Why CEO sponsorship matters](https://www.financealliance.io/p/b8619fbf-6bc6-4c32-8bf1-50f03245e74a/#why-ceo-sponsorship-matters) - [Capturing and demonstrating value](https://www.financealliance.io/p/b8619fbf-6bc6-4c32-8bf1-50f03245e74a/#capturing-and-demonstrating-value) - [Practical steps to gaining CEO sponsorship](https://www.financealliance.io/p/b8619fbf-6bc6-4c32-8bf1-50f03245e74a/#practical-steps-to-gaining-ceo-sponsorship) - [Building a culture of success](https://www.financealliance.io/p/b8619fbf-6bc6-4c32-8bf1-50f03245e74a/#building-a-culture-of-success) - [The role of FP&A in strategic success](https://www.financealliance.io/p/b8619fbf-6bc6-4c32-8bf1-50f03245e74a/#the-role-of-fpa-in-strategic-success) - [Lessons from my journey](https://www.financealliance.io/p/b8619fbf-6bc6-4c32-8bf1-50f03245e74a/#lessons-from-my-journey) - [Sustaining sponsorship](https://www.financealliance.io/p/b8619fbf-6bc6-4c32-8bf1-50f03245e74a/#sustaining-sponsorship) --- ## Understanding CEO sponsorship CEO sponsorship is about more than just a nod of approval for budgets and plans. It’s about becoming a trusted sparring [partner for the CEO](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/) \- someone who challenges assumptions, adds value, and helps steer the organization toward its goals. Finance functions, especially [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/), are uniquely positioned to act as the strategic backbone of the organization. If utilized correctly, FP&A can become the most competitive tool for driving business success. But here's the catch: gaining and maintaining CEO sponsorship requires effort. CEOs don’t just want compliance, they want *collaboration*. They need leaders who can think critically, anticipate challenges, and provide actionable solutions. ## Why CEO sponsorship matters For a healthy finance organization, particularly when it comes to FP&A and strategic planning, CEO sponsorship is critical. Without it, finance teams risk becoming overburdened with repetitive planning cycles, endless revisions, and bottom-up recalculations that exhaust the team before the year even begins. This inefficiency isn’t just bad for productivity, it’s damaging to corporate culture and employee morale. When the CEO and [finance leaders](https://www.financealliance.io/financial-leadership-in-changing-times-2/) align on strategic priorities early, it creates clarity and focus. Defined variables from the top prevent the chaos of endless iterations, freeing up time and energy for what truly matters: delivering value. _This post is for paying subscribers only._ ### FP&A Summit London 2024 | OnDemand URL: https://www.financealliance.io/fp-a-summit-london-2024-ondemand-video/ Last updated: 2025-04-04T10:09:51.000Z Catch up with all the sessions from the FP&A Summit London 2024, with sessions from the likes of easyJet, Vinted, Swiss Re & more. _This post is for paying subscribers only._ ### CFO Summit London November 2024 | OnDemand URL: https://www.financealliance.io/cfo-summit-london-november-2024-ondemand-video/ Last updated: 2025-04-04T10:10:14.000Z Catch up with all the sessions from the CFO Summit London 2024, with sessions from the likes of Muller, ISS Facilities, Credit Suisse & more. _This post is for paying subscribers only._ ### 7 tips for finance to get closer to business URL: https://www.financealliance.io/7-tips-for-finance-to-get-closer-to-business-2/ Last updated: 2025-04-07T09:49:55.000Z Having a strong relationship between [finance and business](https://www.financealliance.io/business-acumen-for-cfos-framework/) is essential for success. But, how do finance professionals get closer to business operations? Are you looking for ways to bridge the gap with your business teams? With a few simple steps, you can improve collaboration and communication with your [business stakeholders](https://www.financealliance.io/stakeholder-communication-plan/). In this article, we'll discuss seven proven tips for finance to get closer to business. ### **1\. Participate in business meetings** The number one tip on our list is to participate in business meetings. Start the conversation asking about business. Through these meetings, finance can gain invaluable insights from their business counterparts. And this will help finance understand the business pain points and challenges better. ### **2\. Understand the business and strategy** To connect with the CFO and senior leadership, developing a deep insight into business strategy is important. It is also crucial that you understand how businesses operate. And so is understanding how [strategy and budgets](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) are connected. ### **3\. Make factory or field visits** It is difficult to solely understand the business by numbers. Financial reports often give an outdated picture of operations. Plant or Factory visits can help finance to gain insights in understanding what's happening around now. ### **4\. Become a free consumer** If you are looking to understand your business better, you can start by consuming your company’s products and services! There is no better way to get the full picture of your business than to experience it firsthand. By using the same products and services that you offer, you can gain valuable insight into how they are being perceived by customers. --- [Transferable FP&A skills that open doorsDid you know that you can leverage transferable skills in FP&A (financial planning & analysis) to shape the career (and life) you truly want? Whether you love your job or find yourself itching for something new, transferable skills can open up career paths you might not have considered.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-30.png)Finance AllianceJody Salbo![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--21-.png)](https://www.financealliance.io/transferable-fp-a-skills-that-open-doors-way-beyond-finance/) --- ### **5\. Finance office hours** Finance teams can host office hours on a weekly or monthly basis. They can use this space to share updates on projects, discuss challenges and answer any questions business teams may have related to finance. In addition to staying up-to-date on current happenings, these office hours provide an informal setting for you to connect and foster an open dialogue with your [business partners](https://www.financealliance.io/finance-business-partnering-playbook-2/). ### **6\. Step into business's shoes** Shadowing your business partner's role for a day can be an incredibly experiential way to learn and grow. It presents you with the chance to experience the inner workings of your organization from the perspective of someone in a different role. ### **7\. Participate in cross-functional projects** [Cross-functional collaboration](https://www.financealliance.io/the-power-of-networking-case-study/) enables teams to break down silos, allowing different departments and areas of expertise to come together towards a common goal. By taking a more active role in such high impact projects, finance can bring a unique perspective based on their expertise and experience. Finance and business go hand in hand - one is incomplete without the other. By applying these tips to your day-to-day activities, you can make sure that communication between finance and business teams is clear and open. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_3.png) ](https://www.financealliance.io/insider-membership-plan/) ### Transferable FP&A skills that open doors (way beyond finance) URL: https://www.financealliance.io/transferable-fp-a-skills-that-open-doors-way-beyond-finance/ Last updated: 2026-04-20T07:27:15.000Z Did you know that you can leverage transferable skills in FP&A (financial planning & analysis) to shape the career (and life) you truly want? Whether you love your job or find yourself itching for something new, transferable skills can open up career paths you might not have considered. Even if you’re happy in your current role, I hope to show you how these skills can help keep things fresh, not just in your career but in the broader scope of life. So, let’s dive into the power of transferable [FP&A skills](https://www.financealliance.io/top-10-fp-a-skills-to-master/) and how to make them work for you... ## Why transferable skills are essential What exactly are transferable skills? They’re essentially skills you’ve honed in one role that can add value in many other areas. Think communication, problem-solving, relationship-building - skills that transcend any specific industry or role. These are important because they demonstrate adaptability in an ever-changing job market. It’s never been more crucial to have these “portable” skills that can help you pivot when needed. FP&A, and finance in general, has changed dramatically over the past decade. Many of us have experienced layoffs, industry shifts, and the like. Transferable skills help you remain resilient and adaptable. From my experience, I can say they’re valuable at every career stage, whether you’re a [CFO](https://www.financealliance.io/cfo-interview-questions-and-answers/) or just starting out. ## Don’t forget the soft skills A turning point for me was when I realized how essential it was to develop soft skills - especially emotional intelligence. These skills help you manage relationships, communicate effectively, and make your work life much happier overall. In FP&A, we’re often the storytellers. We take complex data and craft a story that helps others make decisions. Not everyone can do this well. Your job is not only to understand the numbers but to interpret and communicate them so others understand and, more importantly, *care*. Developing emotional intelligence has helped me become a better strategist and people manager, which are critical skills if you want to grow in any organization. [Building relationships](https://www.financealliance.io/the-power-of-networking-case-study/) also helps you gauge how to adjust your message based on who’s in the room—a skill that’s incredibly valuable whether you’re pitching an idea or presenting financials to stakeholders. --- [15 tips to build Business and Commercial Acumen FASTUnderstanding the complexities of business is a highly sought-after skill. If you want to advance in finance, or any career, you need to start thinking like a business owner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-27.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/commercial-acumen-1.png)](https://www.financealliance.io/15-quick-fire-tips-to-boost-your-business-and-commercial-acumen-fast/) --- ## Breadth vs. depth: Deciding on your own career path In career planning, you often face a choice: do you want to go deep and become a specialist, or do you prefer to explore different fields and gain a wide variety of experiences? Both paths are valuable, and they’re not mutually exclusive. Breadth can give you a rounded understanding that’s crucial for leadership roles, while depth establishes you as an expert. Some roles value diverse experience so much that they require it. For example, one bank I worked for wouldn’t allow anyone to move up to the director level without experience in multiple FP&A areas. The goal was to ensure leaders understood the bigger picture. Not every organization will value this, but the right ones will. ## Hard skills: Financial modeling, budgeting, & Excel Let’s talk hard skills. Many of us are naturally proficient in technical areas like financial modeling, [budgeting](https://www.financealliance.io/5-steps-collaborative-budgeting-process/), forecasting, and data analysis. [Financial modeling](https://www.financealliance.io/10-best-financial-modeling-tools/) skills, for instance, don’t just apply to FP&A - they can transfer to marketing, HR, or operations modeling as well. Every company needs people who can budget and forecast, and as FP&A professionals, we’re often the ones helping other departments make sense of their numbers. Then there’s [Excel](https://www.financealliance.io/chatgpt-for-excel/), the universal language of finance. Excel has been around for over 40 years, and I think it’s still holding up the entire economy! It’s fast, comprehensive, and still the go-to for financial modeling and analysis. Programs like Tableau are great for [visualization](https://www.financealliance.io/9-data-visualization-expert-tips/), but if you want something done quickly and comprehensively, you turn to Excel. ## Soft skills revisited: Critical thinking, problem-solving, & communication If I had to emphasize one soft skill that’s often overlooked, it would be communication. Across the corporate world, good communicators stand out. If you’re not naturally a great communicator, find ways to practice. Take a course, join a committee, or volunteer. For me, working with the Wildlife Conservation Society was transformative. Managing 12 people remotely across different African nations pushed me to communicate effectively, without jargon and with clear intent. Another often-overlooked skill in finance is our ability to innovate. Every time you create a new dashboard or rethink a report, you’re innovating. In FP&A, we often drive company strategy without always being recognized for it, so developing the confidence to speak up about your insights is key. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-28.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FP-A-career-salary-and-path-2-2.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## Building transferable skills: Tips & practical advice How can you build these skills? Here are a few things that worked for me: 1. **Mentorship and networking**: [Find mentors](https://www.financealliance.io/join-the-fa-slack-community/) who support your growth and colleagues who can give you honest feedback. Use your alumni network or events to connect with people who align with your goals. 2. **Take on new projects**: Stretch yourself with projects outside your comfort zone. This could be within your company or even in a personal context. Join a local charity board or volunteer to gain experience that you can bring back to work. 3. **Keep learning**: There’s always something new to learn. Whether it’s [taking a formal course](https://www.financealliance.io/introducing-fp-a-certified-core/) or working on a project in an unfamiliar field, seek opportunities to broaden your skill set. ## Embracing experiences beyond bullet points Transferable skills are what make us more than just our resumes. I’ve worked with wildlife teams in Madagascar, been to the Puppy Bowl (*yes, with puppies!*), and even participated in an ivory crush event to raise awareness for elephant poaching. These weren’t part of my “official” finance role, but every experience taught me something I could apply elsewhere. This diversity in experiences made me more resilient and well-rounded, and it’s given me a wealth of stories that I can share with others in professional settings. ## Joining a board: How and why you should consider it If you’re looking to apply your skills in a new way, joining a board can be incredibly fulfilling. There are numerous ways to get started. For nonprofit boards, Idealist and similar websites often post board opportunities, although you’ll likely be expected to make a financial contribution. For profit boards may be more challenging to break into, but networking is key. Mention your interest to colleagues and friends, and use LinkedIn or board matching services. --- [FP&A: The key to unlocking a company’s financial potentialIn this article, we’ll explore the importance of FP&A and how it can be used to drive business growth and success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-29.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--6--2.png)](https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/) --- ## Introversion in FP&A: How to thrive as an introvert I’m an introvert myself, so I understand how hard it can be to feel like you’re in a field that values extroversion. There’s a misconception that extroverts always have the upper hand in advancing their careers, but that’s not true. Introverts often bring thoughtful insight and deep listening skills to the table. And when we do speak up, it’s often meaningful. One tip for introverts is to regularly practice speaking, even in small ways, like giving updates in team meetings or speaking up in calls. This not only helps you get comfortable but also builds visibility. ## Building the career you want Ultimately, transferable skills give you the freedom to choose your path. They’re the tools that allow you to change industries, sectors, and even work on personal projects. If you’re content in your current role, that’s wonderful! Use these skills to become a better manager, communicator, or team member. If you’re looking for a change, your skill set can give you the confidence to try something new. Every step of your career is an opportunity to learn and grow. Keep building, keep stretching, and keep being open to new possibilities. Transferable skills aren’t just about getting the next promotion—they’re about shaping the life you want, in every sense of the word. --- *This article is based on a presentation given by Jody Salbo, Senior Director of xP&A (FP&A) at* Engel & Völkers *at our FP&A Summit, Boston in 2023\. Catch up on this presentation, and others, using our* [*OnDemand service*](https://www.financealliance.io/ondemand/)*. For more* [*exclusive content*](https://www.financealliance.io/tag/members-only-articles/)*, visit your* [*membership dashboard*](https://www.financealliance.io/pro-plus-membership-dashboard/)*.* ### AI and data analytics-driven finance transformation URL: https://www.financealliance.io/ai-and-data-analytics-driven-finance-transformation/ Last updated: 2025-10-01T10:59:20.000Z Just as crude oil fueled the industrial revolution, data drives the engines of the current digital age. This flood of data, underpinned by rapid advancement in AI and data analytics, fundamentally reshapes the finance functions inside organizations. It's no longer a back-office number-cruncher; finance has evolved to become a strategic powerhouse for growth, performance optimization, and risk mitigation through intelligent use of data. However, such transformation needs a strategic roadmap, along with deep knowledge of both technological capabilities and intrinsic peculiarities of financial operations. [Finance transformation](https://www.financealliance.io/what-is-finance-transformation/) has followed the broader technological development in data management and analytics. Initially, Enterprise Resource Planning (ERP) systems like SAP and Oracle integrated finance by dispersing processes, bringing together a centralized repository. This[ paved the way](https://www.researchgate.net/publication/7327312%5FCompeting%5Fon%5FAnalytics) for data warehouse-driven Business Intelligence (BI) dashboards for fast insights into historical trends and performance measures. Today, the emergence of data lakehouses further supports those capabilities of AI and data analytics that have come to mean a new frontier of predictive and prescriptive capabilities, thus setting finance functions on a path not jus*t* to understand the *"what"* and *"why"* of past performance, but also to anticipate the *"* **what's next**" and proactively shape their organizations' futures. Finance leaders have always been adept at navigating complex financial landscapes. However, “*know-how*” isn't enough; we need to “*know now*.” In other words, AI and [data analytics](https://www.financealliance.io/use-of-data-analytics-and-bi-tools-trend-3-transforming-fp-a/) are no longer optional extracts; they're valuable assets for discovering real-time insights, proactive decision-making, and predictive capabilities. I've led large-scale transformations for major Financial Services institutions and enterprises and this experience has allowed me to witness the *real* issues that legacy systems cause in terms of agility and hindering strategic decisions. What organizations need today is a finance team acting as strategic advisors - a group of professionals who can provide insight and foresight in real time to deal with emerging complexities and capitalize on opportunities. This involves a transformation brought about by four key objectives: ### **1\. From transactional to strategic** Finance must shift from a transactional role, which is focused on recording and reporting, toward a proactive partner that contributes to business strategy and value creation. This represents a more basic change in mindset for finance professionals, using data and AI to identify trends, forecast outcomes, and drive strategic investments. ### **2\. Operational excellence** Operational excellence is changing finance functions, not only by bringing down costs but also by releasing new levels of productivity. [Robotic Process Automation](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) (RPA) solutions automate much of the manual effort and human error involved in such processes as invoice processing and reconciliation, freeing resources for more strategic programs. ### **3\. Regulatory landscape** Finance functions operate in an increasingly complex regulatory environment. Maintaining compliance with evolving standards like [IFRS](https://www.ifrs.org/)[ and GAAP](https://www.accounting.com/resources/gaap/) ( or whichever regional standard may be at play, such as Chinese Accounting Standards ([CAS](https://www.hawksford.com/insights-and-guides/china-business-guides/chinese-accounting-standards-vs-ifrs)) or Indian Accounting Standards ([Ind AS](https://www.mca.gov.in/content/mca/global/en/acts-rules/ebooks/accounting-standards.html)) requires truly robust systems and processes to contain risk. AI provides a robust solution through the automation of compliance checks, and flagging of potential violations in real-time, including but not limited to lease accounting errors under [IFRS 16,](https://www.ifrs.org/issued-standards/list-of-standards/ifrs-16-leases/) and ensures regulatory reporting requirements are met related to generating [XBRL reports](https://www.xbrl.org/the-standard/what/what-is-xbrl/) for filing at the [SEC](https://www.investopedia.com/articles/fundamental-analysis/08/sec-forms.asp). It would minimize any penalties and reputational losses by making the approach proactive and ensuring the accuracy and transparency of financial reporting. ### **4\. Proactive risk management** Proactive identification and mitigation of [financial risks](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) are critical in attaining organizational resilience and ensuring sustainable growth. AI-powered systems can perform continuous monitoring of transactions to identify anomalies and send an early warning on potential fraud or financial misstatement with a timely warning for taking action on time to minimize the potential loss. --- [3 pillars of finance transformation you need to get rightIn this article, I’ll share what I’ve learned along the way, from the interconnected pillars of transformation to the importance of culture in driving real, measurable outcomes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-21.png)Finance AllianceManish Gundecha![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--17-.png)](https://www.financealliance.io/3-pillars-of-finance-transformation/) --- ## **Artificial intelligence and data Analytics** AI and data analytics are no longer concepts of the future, but very real and important tools for today's finance functions. These are the ways whereby the finance function can pursue those above-mentioned objectives. With a bundle of power from AI and data analytics, finance can take a quantum leap from being a reactive cost center to a proactive strategic partner. ### **Automation with RPA** RPA is one example of how finance departments have traditionally been doing repetitive rules-based activities. Right from invoice processing to data entry, reconciliation, and many others, companies [can reduce manual efforts](https://www.datasnipper.com/resources/rpa-finance#:~:text=By%20automating%20repetitive%20tasks%2C%20RPA,accuracy%20and%20reliability%20in%20financial) and errors by up to **50%** if RPA is deployed. This would not only release valuable human capital for more strategic tasks in analysis and decision-making, but would also [provide](https://www.neosofttech.com/blogs/successful-rpa-implementation/) more accurate and effective results. ### **Predictive power of machine learning** ML algorithms are also allowing finance functions to move from historical reporting to predictive capabilities. The ML model can also forecast future trends by analyzing historical data and recognizing patterns, thus enabling appropriate budgeting, financial planning, and [resource allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). This, in turn, will allow organizations to [predict any market changes](https://www.future-processing.com/blog/artificial-intelligence-in-data-analytics-opportunities-and-challenges/#:~:text=Companies%20are%20able%20to%20optimize,and%20identify%20opportunities%20for%20growth.), optimize resource utilization, and proactively make decisions for growth in profitability. ### **Unstructured data unlocks insights** NLP and LLMs now empower finance professionals to distill valuable insights from unstructured data sources like contracts, regulatory filings, reports, and news articles. This critical context helps drive decisions and allows the finance teams to deeply understand market dynamics, customer sentiment, and emerging risks. This will eventually enable organizations to make smarter decisions identify opportunities in advance and reduce potential threats proactively. ### **Data-driven decision making** Advanced analytics [dashboards and visualizations](https://www.financealliance.io/9-data-visualization-expert-tips/) are revolutionizing the way finance departments present and consume information. These tools provide instant insights into financial performance and drive data-based decisions throughout all levels of organizations. More importantly, it arms business leaders with exactly what they need to make the right decisions in a minimum amount of time and, therefore, faster to cope with the agile world. ### **Strengthen risk management** AI-powered systems go hand in hand with underpinning [risk management](https://www.financealliance.io/financial-crime-risk-management-fcrm/) in finance functions. These systems further grant compliance, avoid financial risks, and monitor on an ongoing basis transactions against anomalies and possible fraudulent activities. It is a proactive way of managing risks to help organizations protect their assets, maintain their reputation, and ensure long-term sustainability. --- [Your Guide to Finance Transformation | Finance AllianceIn this guide, we’ll delve into the exciting world of finance transformation and explore how you can harness its power to take your business (and your career) to the next level.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-22.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_4_finance_transformation.jpg)](https://www.financealliance.io/your-guide-to-finance-transformation/) --- ## **Key use cases: Where AI is making a real impact** The use of AI and data analytics in finance is not some vague concept; it's a reality being implemented by leading financial institutions to solve real-world challenges and drive tangible business value. Here are some key use cases where AI is making a great impact in **2024**, supported by recent reports and statistics: ### **Invoice processing** AI will revolutionize invoicing processes by automating tasks related to data extraction, invoice matching, and fraud detection. Key information from invoices can be automatically extracted independently of their form, either paper or digital, using AI-driven invoice processing solutions to prevent manual entry and reduce errors. For example, the AI-driven document processing platform Rossum [boasts](https://rossum.ai/five-ways-ai-benefits-invoice-automation/) it can achieve up to **98%** accuracy in invoice data extraction, hence effectively boosting efficiency and increasing efficiency related to the processing time. Moreover, AI algorithms can execute the three-way matching of invoices with POs and receipts. ### **Account receivable** AI is also [rebalancing](https://www.credit-iq.com/us/resources/detail/The-Future-of-Accounts-Receivable-How-AI-is-Revolutionizing-AR-Automation#:~:text=AI%20enables%20real%2Dtime%20accounts,enhancing%20customer%20satisfaction%20and%20loyalty.) accounts receivable by greatly improving credit scoring, collection, and cash flow forecasting. AI algorithms can analyze huge volumes of data on customer payment history, credit scores, and market trends to predict late payments and indicate customers who are most likely to present risk. Thus, AI enables business owners to take a proactive approach toward [credit risk management](https://www.financealliance.io/earnings-credit-rate-ecr/) and optimizing collections strategies. ### **Accounts payable operations** AI is smoothing the workflow of accounts payable by automating invoice processing, vendor management, and fraud prevention. As mentioned earlier, AI can do automatic data extraction in invoices and their matching, hence saving manual effort and reducing inaccuracies. Also, AI can perform vendor data analysis to spot potential risks, such as financial instability or compliance issues, for proactive vendor management. Some AI algorithms can also identify various anomalies in invoice data, such as duplicate invoices or suspicious payment requests, to prevent fraudulent activities and compliance with internal controls. ### **Accounts reconciliation** The use of AI will surely [continue](https://docyt.com/article/benefits-of-ai-powered-automated-account-reconciliation/) to drive efficiency and effectiveness in account reconciliations with automated data matching, identification of discrepancies, and preparation of reconciliation reports. AI algorithms can sift through large volumes of transaction data, identify and clear matching exceptions, and update current statuses of reconciliations. This development reduces manual efforts and, therefore, cuts down on errors, thereby speeding up the process of reconciliation. ### **Predictive financial forecasting** AI models enhance financial forecasting by analyzing vast amounts of historical data, market trends, and external factors to generate more accurate predictions of revenue, expenses, and cash flow. This allows organizations to anticipate future [financial performance](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/), identify potential challenges, and make proactive adjustments to their strategies. For example, [Shell](https://www.researchgate.net/publication/323092695%5FThe%5Fprice%5Fprediction%5Ffor%5Fthe%5Fenergy%5Fmarket%5Fbased%5Fon%5Fa%5Fnew%5Fmethod) and BP have started implementing machine learning since 2017 to predict changes in energy markets for improved revenue predictions from global trends in energy consumption and pricing. ### **Automated financial reporting** RPA and AI are automating the generation of financial statements and reports, freeing up finance professionals from tedious manual tasks and reducing the risk of errors. This not only saves time and resources but also ensures greater accuracy and consistency in financial reporting. For example, in [a recent study](https://www.gartner.com/en/newsroom/press-releases/2024-09-11-gartner-survey-shows-58-percent-of-finance-functions-use-ai-in-2024), Gartner finds that **58%** of organizations are using AI for financial reporting in everything from automated data extraction and reconciliation to variance analysis and anomaly detection. [Large language models](https://www.financealliance.io/chatgpt-for-excel/) are being considered to parse legislation and regulations in countries where they operate to ensure each regulation is followed. ### **Fraud detection and compliance** AI algorithms are playing a crucial role in combating financial crime by monitoring transactions in real time, identifying suspicious patterns, and flagging potential fraud. This helps organizations stay ahead of increasingly sophisticated fraudsters and protect their financial assets. A [report](https://cfca.org/telecommunications-fraud-increased-12-in-2023-equating-to-an-estimated-38-95-billion-lost-to-fraud/) by the Communications Fraud Control Association (CFCA) found that telecommunications fraud in the global telecom industry increased **12%** in 2023 equating to an estimated **$38.95 billion** lost to fraud. AI-powered solutions can help analyze call records for anomaly detection and flag suspicious activities to help the operators reduce such losses and save their revenue streams. ### **Expense management automation** AI is streamlining expense management by automating expense reporting and reimbursement processes. By extracting data from purchase histories, and receipts, categorizing expenses, and ensuring compliance with company policies, AI reduces errors, saves time, and frees up employees from tedious administrative tasks. For instance, retail companies like [Walmart](https://corporate.walmart.com/news/2024/03/14/walmart-commerce-technologies-launches-ai-powered-logistics-product) are into the use of AI mechanisms for automating purchase-ordering and expense management. Companies use AI-driven systems that study customer purchasing habits of the past and predict future needs to optimize products. This will help smoothen their procurement cycles and enhance overall operational effectiveness, saving a lot of manual efforts and reducing procurement costs. ### **Liquidity and cash management** Predictive analytics is [optimizing cash flow forecasting](https://www.financealliance.io/3-cash-flow-forecasting-challenges/), working capital management, and investment decisions, improving liquidity and financial stability. This allows organizations to better manage their cash flow, optimize working capital, and make informed investment decisions. For example, big corporations like Hunt Companies have adopted the AI-powered [Kyriba](https://developer.kyriba.com/site/global/change%5Flog/articles/the-role-of-ai-in-liquidity-management.gsp) platform in their approach to real-time liquidity management. Equipped with integrated APIs, this platform makes working in the treasury easier by providing real-time visibility of cash flows for better capital allocation. AI assists in [liquidity management](https://www.financealliance.io/12-proven-strategies-for-managing-liquidity/) in all ways a firm might need because it further empowers the ability of a firm to handle the cash reserve with the help of predictive analytics, which can predict and deliver future liquidity needs, especially in times of turmoil in the markets. In 2023, industries like healthcare also benefited from AI in managing treasury. Health Care Service Corporation [employed](https://treasury-management.com/articles/the-disruptive-potential-of-generative-ai) AI-driven treasury data analytics and reinvented cash flow management to make better-working capital decisions. The move freed up over 1,000 hours of productivity by automating what had been manually-intensive cash management practices. With the power of AI-driven models, the company attained faster and more data-driven decisions that allowed it to manage liquidity through unpredictable financial cycles better. --- [AI in Finance eBook | Free DownloadWelcome to the AI in Finance eBook, your trusted guide to merging AI’s vast potential with everyday finance operations such as forecasting, budgeting, analysis, and more.👇![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-23.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_AI_in_Finance_Playbook_Blog.png)](https://www.financealliance.io/ai-in-finance-ebook-download/) --- ## **Implementing AI in Finance** The transformation of the finance function with AI is not a plug-and-play exercise; rather, it calls for a structured approach, commitment toward change, and deep insight into both the technology and nuances of financial operations. Below is a high-level roadmap highlighting the major phases a company undergoes during its AI finance implementation. ![finance transformation implementation](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/11/blogimage1.jpg) This phase-based approach to AI implementation in finance underlines the strategic process and iterative evolution, as opposed to a typical finance transformation that would center around ERP systems, data warehouses, and business intelligence dashboards. While those technologies centered around centralization of data and reporting, this roadmap counts on **data as a foundation for AI**, with much stress on **data governance**, **advanced analytics**, and **continuous improvement**. It does this by pointing out that AI is a constantly evolving entity, and to keep up, agile adaptation is required, whereas most implementations of traditional systems are more rigid. Besides that, it covers **change management** and **cross-functional collaboration** to ensure seamless integration of AI into the finance function and greater organzational objectives. The approach regards AI in finance as an issue of unlocking predictive and prescriptive capabilities that underpin strategic decision-making and create new value, not just mere automation. ## **Building the right foundation: Delivery structure and enterprise architecture** Successfully integrating AI into the finance function is not just about choosing the right technology; rather, it is about building a sound foundation that will lay the base for effective implementation and adoption. This requires a robust delivery structure with a well-defined enterprise architecture supportive of the organization's ambitions in AI. ### **Delivery structure:** ![roadmap for finance transformation](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/11/blogimage2.png) Well-structured collaboration, knowledge sharing, and effective execution are what organizations require for effective AI adoption. The Finance Transformation CoE will act as a **central hub** of AI expertise to provide a crystal clear AI skillset to any organization by guiding and providing governance on best practices and support regarding AI initiatives across organizations. It drives innovation, aligns with overall business strategy, and inculcates a culture of data-driven decision-making. Of equal importance is the formation of cross-functional teams comprising finance, IT, and operations, among others. In this way, it [involves all the stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) in the designing and implementation of AI solutions so that the diverse needs within the organization are catered for. Moreover, the usage of external expertise and technology partnerships would be an effective means of guaranteeing access to those particular skills and solutions that may be beyond reach or even unavailable internally. This, therefore, will help organizations hasten AI implementation and tap into state-of-the-art technologies and best practices. Finally, this will be [change management](https://www.financealliance.io/5-change-management-strategies-finance-transformation/) for successful AI adoption. It will be important to clearly communicate the process along with comprehensive training and sustained support to enable employees to navigate through changes resulting from AI and resolve their anxieties so as to work in a culture of continuous learning and improvement. --- [5 CFO change management strategies: finance transformationWith the right approach, you can effectively manage this resistance and bring your finance team into the modern age of digitalization and in this blog post, we’ll show you how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-24.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Change-management-strategies-for-cfos.jpg)](https://www.financealliance.io/5-change-management-strategies-finance-transformation/) --- ## **Enterprise architecture** A clearly defined enterprise architecture ensures seamless integration of the capabilities of AI across all functions of finance, including financial planning, accounting, treasury, risk management, tax, procurement, revenue management, reconciliation, and [strategic finance](https://www.financealliance.io/how-to-improve-your-strategic-impact-in-finance/). It shall guarantee that AI will be utilized to its fullest extent throughout the whole finance function, hence driving maximum impact on efficiency, decision-making, and risk management. From the technical perspective of this architecture, it needs to have a unified data layer that allows the aggregation of data from various sources into one centralised repository and has quality control in data maintained uniformly. The integration layer, via APIs and data pipelines, shall provide for efficient communication amongst the numerous systems involved that allow proper flow and, where applicable, analyses of the data. The AI and analytics layer provides the platform for creating and deploying AI models and advanced analytics. The application layer integrates the use of AI into existing financial applications to drive greater automation, insight, and decision-making. The interface layer, including user-friendly dashboards, mobile apps, and conversational chatbots, will easily bring user access to AI-powered insights and tools by making interactions with data and systems intuitive. Security measures and compliance frameworks are significant in the security and governance layer for protection of data and responsible, ethical use of AI systems. The infrastructure layer finally consists of scalable cloud and on-premise resources that enable AI workloads to scale systems for handling rapid growth in volume and complexity of financial data. ## **Governance of Data and AI** The only way organisations can avoid inefficiencies, overlaps, and silos is by ensuring a **strong data** and **AI governance** framework. While various departments may have their respective data and AI initiatives, it requires a more centralised governance structure to achieve consistency across the board and to encourage collaboration to maximise value from these efforts. [Finance](https://www.financealliance.io/decentralized-finance-disrupting-traditional-finance/) can lead this cross-functional effort, given their intimate understanding of enterprise data management, [regulatory compliance](https://www.financealliance.io/finance-and-compliance/), financial reporting, reconciliation, and balance sheet management. It includes: ![governing AI in finance ](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/11/blogimage3-1.png) By embedding the governance of data and AI into its core functions, finance can encourage cross-functional cohesion, optimise the use of data, and unlock the full value of AI while minimising the risks of AI. ## **Reaping the rewards: Benefits and outcomes** Where organizations are able to effectively fold AI into their finance functions, they tend to achieve major dividends on efficiency, decision-making, risk management, and strategic positioning. ### **Automation and efficiency** AI-driven automation cuts out the tedium from routine operations, such as invoice processing, which often yields appreciable efficiency dividends.. This is the equivalent of a real cost saving; in one 2024 Deloitte [case study](https://psico-smart.com/en/blogs/blog-digital-transformation-optimizing-business-processes-for-the-future-11728), a global consumer goods company reduced finance operating costs by 15% through the use of AI-driven automation. ### **Decision making enhanced** Real-time analytics coupled with AI-cognitive-driven insight can drive data-driven decisions toward better financial performance. According to PwC’s Global NextGen [survey](https://www.pwc.in/services/entrepreneurial-and-private-business/nextgen.html) in 2024, 70% of finance executives believe AI will significantly enhance forecasting accuracy. Indeed, in Unilever, its 2023 [annual report ](https://technologymagazine.com/articles/ai-the-new-secret-ingredient-in-unilevers-customer-recipe)showed that the AI-powered demand forecast enhanced the forecast accuracy by 20%, with obvious further effects on better inventory management and reduced waste. ### **Risk mitigation** AI enables risk management to achieve higher levels in terms of fraud detection, compliance monitoring, and risk assessment. It has also been [noted](https://www.helpnetsecurity.com/2024/07/18/ai-powered-synthetic-identity-fraud/) that synthetic identity fraud increased by 47% in 2023, further cementing the requirement for fraud advanced detection systems powered by AI. In response to these issues, the use of AI in risk mitigation is growing. According to [Market.us](http://market.us), the [AI In Fraud Detection Market](https://market.us/report/ai-in-fraud-detection-market/) valued $12.1 billion in 2023 is further expected to reach a market size of $108.3 billion by 2033 growing at a CAGR of 24.50%. It has grown rapidly as fraud activities they conduct are evolutionary in nature, and most organisations now need to deploy AI technologies inside fraud prevention solutions that ensure efficiency and accuracy. ### **Strategic partnership** AI enables finance to become a strategic partner in the business by bringing real-time insights with predictive capability. AI in the real estate sector helps partnerships study market trends, property values, and customer preferences. Predictive analytics can guide developers and investors in forming strategic alliances to invest in high-growth regions or projects. In 2024, the global generative AI in [real estate market](https://www.precedenceresearch.com/generative-ai-in-real-estate-market) size is calculated at USD 437.65 million, grew to USD 488.06 million in 2025, and is predicted to hit around USD 1,302.12 million by 2034, expanding at a CAGR of 11.52% between 2024 and 2034. ### **Competitive advantage** Early adoption of AI in finance positions organizations as innovators. Thus, early-bird entities can adapt to changing market conditions and outperform competitors. [According to Gartner](https://www.gartner.com/en/newsroom/press-releases/2024-09-12-gartner-predicts-that-90-percent-of-finance-functions-will-deploy-at-least-one-ai-enabled-tech-solution-by-2026), by 2026, **90%** of finance functions will deploy at least one AI-enabled technology solution, but less than **10%** of functions will see headcount reductions. These examples represent very concrete benefits of AI in finance from a variety of industries. Early adoption of [AI in Finance](https://www.financealliance.io/ai-in-finance-ebook-download/) places organizations in innovator positions, thus the ability to race ahead of others and respond to constantly changing market conditions. It allows the organization to be at an advantage by applying AI in its efficiencies, innovation, and customer service. --- [How to use ChatGPT Canvas for finance & FP&AOpenAI has just dropped a game-changer for ChatGPT users: Canvas. This new tool opens in a separate window, making it easier than ever to collaborate with ChatGPT on specific projects.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-25.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Stock--4--1.png)](https://www.financealliance.io/chatgpt-canvas-for-finance-fp-a/) --- ## **Future of finance: AI-driven and data-rich** The future of finance demands a commitment to change, strategic investment, and readiness to embrace transformation. To fully realize the potential of AI-driven finance, organizations need to foster active stakeholder engagement, invest in relevant talent, and continuously monitor and adapt their changes. Key pillars of this transformation include: securing executive sponsorship, roadmapping, upskilling the finance team, and monitoring key performance indicators (KPIs) that assure desired outcomes from AI initiatives. ### **Sustainable finance** Beyond mere efficiency gains and enhanced decision-making, the future of finance will run on AI and big data analytics with a new focus on green and sustainable finance. Itspractices would be enabled through the use of AI. Moreover, KPMG in its recent [article](https://kpmg.com/ch/en/insights/esg-sustainability/sustainable-finance/artificial-intelligence-use.html) also highlighted that AI is revolutionizing sustainable finance by enabling advanced risk assessment, climate risk modeling, impact investing, sustainable [supply chain management](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/), and greenwashing detection, empowering financial institutions to drive positive environmental and social change while maximizing returns. However, widespread adoption is still hindered by challenges such as data availability, model accuracy, regulatory uncertainty, and varying levels of maturity across different sectors and organizations. This is not just a shift; it is a fundamental redefinition of how financial systems will operate in an increasingly focused on sustainability world. ### **Monetizing data and AI models** Data and AI models will evolve from being tools into crucial assets and intellectual property (IP) for companies. Accordingly, taking a lead interest in the development and deployment of innovative solutions with AI, new revenue streams for the finance functions could come from offering data-driven products and services, licensing AI models, or even creating data marketplaces. The European Commission estimates that [**the EU’s data economy alone will be worth €829**](https://www.imd.org/ibyimd/technology/monetizing-data-in-the-ai-era-increasing-profits-while-preserving-privacy/)bn in 2025, accounting for around **6%** of regional GDP. In this new realm, the ability to use and commercialize data will become a key differentiator for forward-thinking financial companies. ### **Enhanced cybersecurity** In the wake of increased reliance on data and AI, the need for strong cybersecurity measures will be very crucial as finance functions. AI [applications will be made](https://www.fintechscotland.com/the-role-of-ai-and-cybersecurity-in-the-financial-sector/#:~:text=By%20leveraging%20AI%20technologies%2C%20financial,data%2C%20and%20maintain%20customer%20trust.) to detect and prevent any form of cyber threat, which will be very crucial in keeping sensitive financial data and maintaining the integrity of the financial systems. The market for AI-based cybersecurity is set to grow remarkably - from $24.3 billion in 2023 to nearly $134 billion by 2030, according to [Statista](https://www.statista.com/statistics/1450963/global-ai-cybersecurity-market-size/). This surge underscores the crucial need for robust security measures as financial companies continue their digital presence and transformation. While ransomware, in recent years, has attacked many sectors other than the financial sector, some of the major sectors involved are manufacturing, healthcare, and energy. For example, in the [Colonial Pipeline attack ](https://www.cisa.gov/news-events/news/attack-colonial-pipeline-what-weve-learned-what-weve-done-over-past-two-years)in 2021, both the financial and operational data were affected. Most businesses had to use AI to focus on spotting anomalies in network activity to quickly identify a breach. In [manufacturing](https://www.threatintelligence.com/blog/manufacturing-ransomware), ransomware attacks on supply chains have put companies into adopting AI-driven security systems that can predict vulnerabilities based on data patterns and guarantee protection for financial transactions and intellectual property. Meanwhile, in healthcare, AI-powered cybersecurity solutions go into the protection of sensitive patient data and financial records after the ransomware [attacks that struck hospital systems in 2024 ](https://www.hipaajournal.com/change-healthcare-responding-to-cyberattack/#:~:text=It%20has%20taken%208%20months,population%20of%20the%20United%20States.)in the US exposed patient and financial information. --- [15 tips to build Business and Commercial Acumen FASTUnderstanding the complexities of business is a highly sought-after skill. If you want to advance in finance, or any career, you need to start thinking like a business owner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-26.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/commercial-acumen.png)](https://www.financealliance.io/15-quick-fire-tips-to-boost-your-business-and-commercial-acumen-fast/) --- ### **Finance self-service agent assistants** Beyond these trends, the rise of AI-driven self-service agent assistants is about to revolutionize the way finance professionals interact with data. The assistants will use NLP to enable users to analyze, process, and manage financial data by using conversational language. Suppose you are asking an AI assistant to "*forecast the revenue of next quarter based on current trends*" or "*identify any anomalies in this month's expenses*." There is no need for complicated software products or specialized skills. In other words, everyone can use this highly effective tool for financial analysis. For example, in 2022 [Gartner](https://www.gartner.com/en/newsroom/press-releases/2022-07-27-gartner-predicts-chatbots-will-become-a-primary-customer-service-channel-within-five-years) predicted that by 2025 - 70% of white-collar workers will interact with conversational platforms daily. Additionally, the rise of AI has significantly accelerated the growth of self-service analytics, particularly by enhancing user accessibility and insight generation. Gartner also [predicts](https://www.gartner.com/en/newsroom/press-releases/2023-08-30-gartner-reveals-three-technologies-that-will-transform-customer-service-and-support-by-2028) that by 2025, 80% of data and analytics innovations will be developed with AI and machine learning, further underscoring the pivotal role of AI in self-service analytics tools. These AI-driven assistants will not only respond to questions but will evolve into proactive advisors anticipating needs and automating routine tasks like report composition and account reconciliation. ## **AI-driven transformation in finance: What's next?** The finance function is on the verge of a profound transformation, with AI and data analytics becoming essential for driving operational efficiency, revenue assurance, cost optimization, risk mitigation, and strategic growth. As we look to the future, financial leaders must embrace continuous learning, agile adaptation, and robust data governance to fully leverage the potential of AI. Organizations should prioritize building data-driven cultures, investing in cross-functional teams, and implementing advanced AI systems to maintain a competitive edge. Emerging technologies such as generative AI, predictive analytics, and self-service AI-driven tools will revolutionize how finance teams operate. The next step of finance transformation will see these technologies more deeply into daily processes, enabling finance functions to evolve from reactive to proactive strategic partners. Furthermore, [sustainable finance](https://www.financealliance.io/7-benefits-of-esg-investing/), enhanced [cybersecurity](https://www.financealliance.io/cfo-cybersecurity/), and the monetization of AI and data assets will become crucial focus areas. For businesses, now is the time to invest in talent development, strategic AI roadmaps, and continuous monitoring of AI-driven initiatives. Those that do will gain a competitive edge, unlocking new efficiencies, revenue streams, and long-term value. As finance leaders, the opportunity is clear: embrace AI’s potential to redefine finance as a data-rich, AI-driven powerhouse for the future. --- ## **Finance Transformation Summit: FREE virtual event (November 13, 2024)** Stay up-to-date with the skills you need to accelerate your finance transformation strategies -learn to leverage AI, integrate automation, and empower your team to thrive. Join senior finance leaders from around the globe as they share their insights and innovations Claim your free pass to access all live sessions and OnDemand recordings post-event. 👇 [Register here](https://virtual.financealliance.io/location/transformation/register) ### AI revolution in Fintech: Unleashing transformative innovation URL: https://www.financealliance.io/ai-revolution-in-fintech-unleashing-transformative-innovation-2/ Last updated: 2024-11-05T08:42:28.000Z The fusion of artificial intelligence (AI) and financial technology (fintech) is igniting a seismic shift that promises to redefine the future of finance. As AI rapidly evolves, its disruptive potential in the fintech realm is becoming increasingly palpable, catalyzing a wave of innovation that will reshape customer experiences, operational efficiencies, and the very fabric of financial services. At the heart of this revolution lies the convergence of cutting-edge AI technologies, including machine learning, deep learning, natural language processing (NLP), and computer vision. These powerful tools are enabling fintech companies to harness the vast ocean of data at their disposal, extracting valuable insights, identifying intricate patterns, and making intelligent decisions with unprecedented speed, accuracy, and scalability. ## **Fraud detection and prevention: Safeguarding financial integrity** One of the most transformative applications of AI in fintech is in the realm of fraud detection and prevention. Traditional rule-based systems have long been the industry standard, but they often struggle to keep pace with the ever-evolving tactics of fraudsters. Enter AI-powered fraud detection solutions. By leveraging advanced [machine learning](https://www.financealliance.io/fpa-machine-learning/) algorithms trained on massive datasets encompassing millions of transactions, AI systems can continuously learn and adapt, identifying even the most subtle anomalies and suspicious patterns that might indicate fraudulent activity. This not only enhances security and trust in financial systems but also streamlines processes, reducing costs and minimizing the impact of fraud on businesses and consumers alike. --- [CFO cybersecurity: What’s the CFO’s role in cybersecurity?From crunching numbers to combating cyber threats, the role of the CFO has leaped into uncharted territory, making CFO cybersecurity one of the hottest topics in boardrooms across the globe.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-18.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Framework_Tiles_4_data_protection.jpg)](https://www.financealliance.io/cfo-cybersecurity/) --- ## **Personalized financial advisory: Tailored solutions for every individual** Another domain where AI is making waves is personalized financial advisory services. Traditionally, obtaining tailored financial advice has been a privilege reserved for the wealthy, with the vast majority of individuals relying on generic, one-size-fits-all solutions. AI is democratizing this landscape. Through the power of machine learning and natural language processing, AI-powered financial advisors can analyze an individual's financial data, investment preferences, risk tolerance, and life goals to provide highly personalized recommendations. From [optimizing investment portfolios](https://www.financealliance.io/multiple-on-invested-capital-moic/) and managing risks to budgeting and tax planning, these AI-driven solutions offer customized guidance at scale, empowering individuals to make informed financial decisions aligned with their unique circumstances. ## **Lending and credit scoring: Enhancing access and fairness** The realm of lending and [credit scoring](https://www.financealliance.io/earnings-credit-rate-ecr/) is also undergoing a profound transformation driven by AI. Traditional credit scoring models have long been criticized for their reliance on limited data sources and potential biases. AI offers a path toward more inclusive and equitable lending practices. By leveraging machine learning algorithms capable of analyzing a vast array of alternative data sources, such as utility bills, rental history, and social media activity, AI-powered credit scoring models can construct more comprehensive risk profiles. This not only improves access to credit for individuals with limited traditional credit histories but also reduces the risk of discrimination and bias, fostering greater financial inclusion. --- [Decentralized finance: Disrupting traditional financeThe DeFi ecosystem is rapidly expanding, offering a wide range of services, including lending and borrowing platforms, decentralized exchanges (DEXs), stablecoins, and more.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-19.png)Finance AllianceBrendan Byrne![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles-2.png)](https://www.financealliance.io/decentralized-finance-disrupting-traditional-finance/) --- ## **Regulatory compliance and risk management: Navigating complexities** In the highly regulated world of finance, ensuring compliance with ever-evolving rules and regulations is a constant challenge. AI is emerging as a powerful ally in this domain, enabling fintech companies to navigate the complexities of regulatory landscapes with greater ease and efficiency. Through the application of natural language processing and machine learning, AI systems can rapidly analyze vast troves of regulatory documents, extracting relevant information, identifying potential areas of non-compliance, and providing actionable insights to [mitigate risks](https://www.financealliance.io/financial-crime-risk-management-fcrm/). This not only enhances compliance but also reduces the operational overhead and potential penalties associated with regulatory violations. According to a recent report by renowned fintech research firm FinTech Analytics, the areas poised to benefit the most from AI integration in the near future include: 1\. Automated trading and investment management 2\. Regulatory compliance and risk management 3\. Customer service and engagement (chatbots, virtual assistants) 4\. Anti-money laundering (AML) and know-your-customer (KYC) processes 5\. Fraud detection and prevention 6\. Lending and credit scoring As Dr. Emily Johnson, Chief AI Strategist at FinTech Innovators, notes: > "The convergence of AI and fintech is not merely a technological shift; it's a paradigm shift that will redefine how we interact with and experience financial services. Those who embrace this revolution early and effectively will gain a significant competitive edge in the years to come." ## **Forging transformative partnerships: AI meets Fintech** In the coming year, we can expect to witness several high-profile partnerships between fintech leaders and AI technology providers, accelerating the pace of innovation and shaping the future of finance. One such rumored collaboration is between blockchain-based lending platform LendingX and the AI research powerhouse DeepMind. According to industry insiders, the two companies are in advanced talks to leverage DeepMind's cutting-edge language models and deep learning capabilities to enhance LendingX's customer interactions, streamline loan processes, and improve risk assessment. Another potential game-changer is the reported partnership between personal finance giant Mint and OpenAI. Credible sources suggest that the two companies are collaborating to develop a conversational AI assistant capable of providing highly personalized financial advice, budgeting recommendations, and investment guidance tailored to each user's unique circumstances. These are just the tip of the iceberg, as numerous fintech startups and established players alike are actively exploring collaborations with AI technology providers to gain a competitive edge in this rapidly evolving landscape. --- [5 steps to avoid budget fails with collaborative budgetingGetting everyone on board can turn a chaotic budget into a united company plan that works. So, if your budget process is close to falling apart, here’s how the 5 phases of collaborative budgeting can save it.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-20.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Doodles--4-.png)](https://www.financealliance.io/5-steps-collaborative-budgeting-process/) --- ## **Navigating the path forward: Challenges and opportunities** While the potential of AI in fintech is undeniable, its adoption is not without challenges. Addressing issues such as data privacy, algorithmic bias, and regulatory compliance will be crucial for sustainable and ethical AI implementation. Data privacy and security are paramount concerns, as AI systems rely on vast amounts of sensitive financial data to function effectively. Robust data governance frameworks, secure data storage and transmission protocols, and strict adherence to privacy regulations like GDPR and CCPA will be essential. Algorithmic bias is another critical challenge that must be addressed. AI models are trained on historical data, which can perpetuate existing biases and discriminatory patterns. Fintech companies must actively work to identify and mitigate these biases, ensuring that AI-driven decisions are fair, equitable, and free from discrimination. Regulatory compliance is another area that requires careful navigation. As AI technologies continue to evolve and disrupt [traditional financial processes](https://www.financealliance.io/17-finance-business-processes/), regulators will need to adapt and develop appropriate frameworks to govern their use. Fintech companies must proactively engage with regulatory bodies to ensure compliance and foster trust in AI-driven financial services. Despite these challenges, the potential benefits of AI in fintech are too significant to ignore. By embracing this transformative technology responsibly and ethically, the fintech industry stands poised to unlock unprecedented levels of innovation, efficiency, and personalization, ultimately enhancing the financial well-being of individuals and businesses worldwide. The AI revolution in fintech is well underway, and those who harness its power strategically will emerge as the leaders of the future financial landscape. As the world of finance continues to evolve, one thing is certain: the fusion of AI and fintech will be a driving force, reshaping the industry in ways we can scarcely imagine today. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_6.png) ](https://events.financealliance.io/) ### 5 steps to avoid budget fails with collaborative budgeting URL: https://www.financealliance.io/5-steps-collaborative-budgeting-process/ Last updated: 2025-10-30T13:00:33.000Z Budgeting is often messy and difficult to get right. Unclear goals, unrealistic expectations, and isolated departments can make the process feel like a never-ending battle. All these issues can lead to budgets that collapse before they even get off the ground. So, why does this happen? Well, if numbers aren’t the problem, it *could* be a lack of teamwork. Meetings and top-down orders aren't always the right answer. ![](https://media.tenor.com/Ntcp2uq39dYAAAAC/huh.gif) Instead, you need a structured approach to the budget process. This is where the five phases of collaborative budgeting come in. Getting everyone on board can turn a chaotic budget into a united company plan that works. So, if yourbudget process is close to falling apart, here’s how the 5 phases of collaborative budgeting can save it.**👇** ## **1\. Pre-kickoff: Setting the stage for success** The pre-kickoff phase is the preparation stage *before* formal budget talks begin. This is your chance to get everyone on the same page. Teams must work together to build budget projections based on key goals, company priorities, and data. This phase also includes setting timelines and identifying who’ll be involved in the [budgeting](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/) process. But it’ll only work as a collaborative process when you get input from *all* departments. By doing this, you’ll create a budget grounded in reality that accurately reflects the needs of the entire company. It creates clarity you won't get if you work in a silo without help or input from others. **Success tips:** - **Set clear objectives and identify what the budget is meant to achieve.** Whether it’s growth, cost control, or innovation, jot those down and don’t leave them to collect dust. It would be best to communicate these goals to *all* stakeholders in a way they understand. In other words, avoid using complex financial jargon (*if you can help it!*). - **Compile historical financial data, market trends, and forecasts.** This will give you a solid foundation for the upcoming planning. - **Decide who you need to get involved in the budgeting process.** Ensure each department has a representative. Then, assign roles and responsibilities as needed. ## **2\. Joint planning: Aligning goals across departments** The second phase of collaborative budgeting is joint planning. This will happen soon after the initial kick-off stage and requires bringing everyone together. We’re talking department heads, [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/), the whole team. You need to set up joint planning sessions where everyone can present their budget proposals, along with their ideas, needs, and so on. For this to work, you need to encourage transparent communication so that everyone can openly voice concerns and negotiate trade-offs. They can also see how their budget affects others. 💡 ****Tip**: Always keep your company’s big-picture goals in mind. Doing this will help make sure that every budget proposal is in service of broader objectives. ## **3\. Consolidation: Bringing it all together** Now that you have all the departmental budgets, it’s time to combine them into a single, unified corporate budget. This phase is your chance to : - Resolve any differences - Remove redundancies - Create a realistic and achievable budget (within the company's financial limits) By consolidating budgets, you can get a clearer picture of [how resources are allocated across the company](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). Issues like overspending and underfunding are *a lot* easier to identify during this phase of the budgeting process. Here’s how to do it: 1. **Review departmental budgets**. Look for inconsistencies or overlaps in each budget. 2. **Use** [**financial modeling**](https://www.financealliance.io/10-best-financial-modeling-tools/) **tools**. Use software that consolidates all budget data into a single view. 3. **Set priorities**. Allocate resources to the most important areas of the business. This prevents departments from overspending or being underfunded for important initiatives. --- [How to turn forecasting & budgeting mistakes into milestonesIn this article, we’ll explore key lessons in implementation processes and corporate strategy, and how you can use them to achieve real, tangible results in your FP&A function. You’ll also discover real-world examples and success stories to inspire and guide your own journey to success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceJames Manning![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/09/Copy-of-FA_Website_Article_Images_Author_Highlight--9-.png)](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/) --- ## **4\. Iteration: Refining the budget through feedback** The fourth stage is the iteration phase. Here, you'll gather feedback from all involved and adjust the budget. You may have to improve the initial plans based on what you learn and what ends up happening in real-time. ****Hint**: It's worth [testing different scenarios](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/) to see if the budget holds up. A rigid budget is one of the main reasons why financial plans fail. If you take time to iterate, you'll likely spot issues early, test for challenges, and make changes *without* delaying the budgeting process. ## **5\. Final alignment: Getting everyone on the same page** ![](https://media.tenor.com/m_Vi-Zb4BnMAAAAC/cat-military-strategy.gif) You’ve made it to the final alignment phase. This is where you finalize the budget and get it signed off by all the stakeholders involved. It's basically the stage when all departments agree the budget *is* achievable and aligns with the company's goals. Even a well-planned budget can fail if it lacks buy-in. Final alignment ensures that everyone - from finance to operations to leadership - is committed to the *same* financial plan. Having this final alignment stage in the budgeting process creates a sense of [shared ownership and accountability](https://www.financealliance.io/financial-accountability/), which makes it more likely that everyone will stick to the budget. Alright, so what does this phase look like in real life? Here are a few tips to help make sure it goes smoothly: - **Hold a final review meeting**. Get key stakeholders together to align on the budget. - **Communicate clearly**. Share the finalized budget across the organization. Include clear instructions on its monitoring and responsibility for each part. - **Assign accountability.** Each department must know who's responsible for managing their budget. They should also know how to report any variances or issues during the year. --- ## FAQs What do you mean by budget process? The budget process is the series of steps organizations take to plan how they will allocate financial resources over a specific period, usually a year. It involves forecasting revenue, estimating expenses, and setting financial goals to guide decisions. Why are budgets useful in the planning process? Budgeting is the decision-making process for accepting and rejecting projects, making them useful because they act as a financial roadmap that helps guide companies when making decisions. What are some key components of successful budgeting? Key components include accurate revenue forecasting, realistic expense estimates, flexibility for adjustments, clear financial goals, and regular monitoring to track progress. Collaboration across departments also ensures all perspectives are considered. What is the usual start point for a master budget? The usual starting point for a master budget is the sales or revenue forecast. This forecast drives other components of the budget, as expected sales levels influence production, purchasing, and operational planning. --- ## **Want to learn more about the five phases of annual budgeting?** Enroll in our [**Budgeting & Forecasting Masters Certified Course**](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) and learn how to navigate each phase with confidence. Gain the skills to: - Create driver-based forecasts and scenario plans with increased accuracy. - Lead the budgeting process from start to finish. - Build robust financial models that withstand uncertainty and provide a solid foundation for strategic planning. ...and with Christian Wattig as your coach, you're in good hands! Ready to take your budgeting skills to the next level? [Enroll today](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### People, process, performance: The 3 pillars of finance transformation URL: https://www.financealliance.io/3-pillars-of-finance-transformation/ Last updated: 2026-04-20T07:23:17.000Z When it comes to [finance transformation](https://www.financealliance.io/your-guide-to-finance-transformation/), change is constant. Over the last few years, I’ve had the privilege of diving deep into this area, both learning and implementing changes within the finance function at HP, Inc. In this article, I’ll share what I’ve learned along the way, from the interconnected pillars of transformation to the importance of culture in driving real, measurable outcomes. ## **What transformation means to me** Transformation is a word that gets thrown around *a lot* these days. Whether it’s setting up a transformation office, implementing new technologies, or adopting AI and [machine learning](https://www.financealliance.io/fpa-machine-learning/), everyone has a different take on what “transformation” actually means. For me, transformation is all of this - and more. It’s not just about shiny new tools or reacting to tough [economic](https://www.financealliance.io/what-is-economic-analysis-the-question-every-cfo-should-be-asking/) times. Transformation is a constant, essential process for staying competitive, no matter the external circumstances. One misconception I often hear is that transformation is only necessary when things are going south. I completely disagree. Whether your industry is booming or facing challenges, transformation should be a priority. Why? Because it’s not about reacting to bad times - it’s about constantly evolving to stay ahead. For me, transformation boils down to three key elements: **sustainable competitive advantage**, **structural change**, and **measurable outcomes**. Let’s break each of these down.👇 ### **1\. Sustainable competitive advantage** At its core, transformation should give your business a competitive edge. Here’s an example: Imagine you’re in an industry where commodity prices fluctuate wildly. If it takes your company weeks to adjust your pricing to reflect those changes, by the time your new prices hit the market, conditions may have already shifted. In contrast, a company with real-time systems that can adjust pricing almost instantly will have a major advantage over you. That’s what I mean by sustainable competitive advantage. Transformation isn’t just about implementing the latest technology, it’s about using that technology to gain an edge. Whether it’s faster decision-making, more accurate data, or improved processes, the goal is to stay ahead of your competitors. ### **2\. Structural change** Structural change is another critical component of [finance transformation](https://www.financealliance.io/what-is-finance-transformation/). It’s not just about temporary adjustments; it’s about fundamentally changing how your business operates. The COVID-19 pandemic is a perfect example of how structural changes can make or break a business. Some industries, like aviation and hospitality, suffered greatly, while others, like tech companies, thrived. Companies like Zoom and DocuSign didn’t just adapt during the pandemic - they made structural changes to how they operated. These changes allowed them to continue thriving even after the world started to return to normal. The lesson here? Transformation should create lasting, structural changes in how your company operates, not just temporary fixes. ### **3\. Measurable outcomes** If you can’t measure the outcomes of your transformation efforts, how do you know if they’re working? For any transformation to be successful, you need clear, measurable outcomes. Whether it’s reducing the time it takes to close your books or improving customer satisfaction, setting concrete goals is crucial. Too often, companies embark on transformation journeys without defining what success looks like. This leads to projects that never fully deliver on their promises. By setting measurable goals, you can track your progress and ensure that your transformation efforts are actually making a difference. --- [Winning over the C-Suite & managing change resistanceChange is inevitable. But why do so many change initiatives fail, even when we, as leaders, embrace new technologies and strategies? In this article, we’ll dig into these hurdles and share some practical strategies for building a strong, flexible business culture that can thrive through change.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceShehryar Gilani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/10/Copy-of-FA_Website_Article_Images_Author_Highlight--15-.png)](https://www.financealliance.io/winning-over-the-c-suite-managing-change-resistance/) --- ## **3 pillars of finance transformation** Now that we’ve covered the three key elements of transformation, let’s talk about the concept of **interconnectedness**. For any transformation journey to succeed, three main pillars - **people**, **process**, and **performance** \- need to work together. These pillars aren’t separate; they’re interconnected, and if any one of them is out of sync, the whole transformation could fail. Let me walk you through each pillar in the context of a case study I’ve been part of. ### **People** No matter how great your technology is, it’s the people who will make or break your transformation. If your team isn’t on board with the changes, the project is destined to fail. It’s not just about training people on new systems—it’s about showing them the benefits of the transformation and how it will make their jobs easier. In my experience, one of the biggest challenges is getting everyone aligned. You need to bring your people along for the journey, ensuring they understand how the transformation will benefit them personally. If they don’t see what’s in it for them, they’re less likely to fully engage with the process. ### **Process** Process inefficiencies are often the root cause of business problems. If your processes are outdated or unclear, no amount of technology will fix that. In fact, implementing a new system without first addressing process inefficiencies can actually magnify the problems. Before you invest in a new tool, make sure your processes are well-documented, tested, and efficient. I like to call this step "paper tiger testing"—you may have fancy documentation, but if you haven’t tested your processes in practice, they might fall apart when put into action. ### **Performance** Finally, let’s talk about performance. When implementing a new system, it’s crucial to define your performance metrics upfront. For example, if your goal is to reduce the time it takes to close your books from 14 business days to four, make sure you have a clear plan for how to achieve that. It’s not enough to just implement the tool - you need to measure the impact it’s having on your performance and make adjustments along the way. --- [The CFO’s crash course in finance and complianceGovernance, risk management and compliance. These aren’t exactly the most exciting aspects of a CFO’s role, but that doesn’t stop them from being vital areas of focus. 🎯![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/FA_Framework_Tiles_3_compliance.jpg)](https://www.financealliance.io/finance-and-compliance/) --- ## **Case study: Implementing a new planning tool** Now let’s bring all these concepts together with a real-life example. Imagine you’re tasked with implementing a new planning tool at a billion-dollar company. The goal is to move from spreadsheets and manual processes to a more automated, efficient system. ### Step 1: Reference check Before jumping in, do a thorough reference check. Talk to other companies who have implemented similar tools and get feedback from the users, not just the executives. This will help you avoid common pitfalls and set realistic expectations. ### Step 2: Define Performance Metrics Set clear [performance metrics](https://www.financealliance.io/why-cfos-need-to-be-people-managers/) from the start. For example, if it currently takes 14 days to complete a planning cycle, your goal might be to reduce that to four days. Make sure these metrics are realistic and that everyone on the team understands what success looks like. ### Step 3: Prioritize When implementing the tool, don’t try to do everything at once. Focus on the most important aspects first, whether that’s the 12-month planning cycle, quarterly forecasts, or something else. Trying to tackle everything at once will only lead to frustration and delays. ### Step 4: Iterate and adjust No transformation is perfect on the first try. Once you’ve implemented the tool, be prepared to iterate and adjust. Listen to feedback from your team and make changes as needed. Transformation is a journey, not a one-time event. --- [Decentralized finance: Disrupting traditional financeThe DeFi ecosystem is rapidly expanding, offering a wide range of services, including lending and borrowing platforms, decentralized exchanges (DEXs), stablecoins, and more.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceBrendan Byrne![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/09/Copy-of-FA_Website_Article_Images_Doodles-2.png)](https://www.financealliance.io/decentralized-finance-disrupting-traditional-finance/) --- ## **Culture: The hidden driver of success** I can’t talk about transformation without mentioning culture. There’s a famous saying: "Culture eats strategy for breakfast." In my experience, this couldn’t be more true. No matter how great your strategy is, if your company culture isn’t aligned with your transformation efforts, the project will struggle. [Culture](https://www.financealliance.io/how-cfos-drive-company-culture-framework/) isn’t something you can write down in a document—it’s something you experience. It’s the unspoken rules that guide how people behave, make decisions, and interact with each other. When embarking on a [transformation journey](https://www.financealliance.io/how-finance-digital-transformation-impact-company/), make sure you take your company culture into account. How do people respond to change? Are they open to new ideas, or do they resist them? Understanding these cultural dynamics is key to a successful transformation. ### **Final thoughts** To wrap things up, successful transformation requires a holistic approach. It’s not just about technology or processes—it’s about bringing people along for the journey, making structural changes, and setting measurable goals. And don’t forget about culture—it’s the glue that holds everything together. If you’re embarking on a transformation journey, my advice is simple: define what transformation means to you and your organization, focus on interconnectedness, and always keep an eye on culture. With the right approach, you can turn any transformation into a sustainable, competitive advantage for your business. --- ### CFO Summit Boston October 2024 | OnDemand URL: https://www.financealliance.io/cfo-summit-boston-october-2024-ondemand-video/ Last updated: 2025-08-15T05:43:20.000Z Catch up on the sessions from the CFO Summit and FP&A Summit in Boston, including speakers from TD Bank, Justworks, Stop & Shop, and many more. _This post is for paying subscribers only._ ### FP&A Summit Boston October 2024 | OnDemand URL: https://www.financealliance.io/fp-a-summit-boston-october-2024-ondemand-video/ Last updated: 2025-04-04T10:10:45.000Z Catch up on the sessions from the FP&A Summit and CFO Summit in Boston, including speakers from TD Bank, Justworks, Stop & Shop, and many more. _This post is for paying subscribers only._ ### 15 quick-fire tips to boost your business and commercial acumen FAST URL: https://www.financealliance.io/15-quick-fire-tips-to-boost-your-business-and-commercial-acumen-fast/ Last updated: 2025-10-01T10:55:01.000Z Understanding the complexities of business is a highly sought-after skill. If you want to advance in finance, or *any* career, you need to start thinking like a business owner. Looking *beyond* the balance sheet and considering the broader dynamics at play - how decisions impact long-term growth, profitability, and customer satisfaction - are all vital to developing a well-rounded business strategy that ensures sustainability, competitive advantage, and overall success. So, how can you develop business and commercial acumen? 🤔 Read on for 15 quick-fire tips to help you do just that. ![](https://media.tenor.com/X15e67QrANUAAAAC/the-office.gif) ## **Commercial acumen vs business acumen** Both business acumen and commercial acumen are vital skills in the professional world, but they differ in scope and focus. Business acumen refers to a broad understanding of how a business operates, including its financial, [operational](https://www.financealliance.io/operational-finance/), and strategic aspects. It's the ability to make sound judgments and decisions that positively impact the overall business performance. Examples of business acumen skills: - **Strategic thinking**: Understanding long-term business goals and aligning actions to achieve them. - **Financial literacy**: Knowing how to read and interpret financial statements like income statements, balance sheets, and cash flow. - **Operational knowledge**: Awareness of how different parts of the business (e.g., HR, IT, production) work together. - **Problem-solving**: Ability to identify, analyze, and solve complex business problems. - **Risk management**: Understanding potential risks to the business and how to mitigate them. - **Leadership and people management**: Managing teams, [influencing stakeholders](https://www.financealliance.io/stakeholder-communication-plan/), and building organizational culture. Commercial acumen, on the other hand, focuses on understanding the market and customers, and how to drive revenue, profits, and growth through commercially sound decisions. It’s more about the external environment like markets, customers, and competitors. Some key commercial acumen examples: - **Customer insight**: Deep understanding of customer needs, preferences, and behaviors. - **Market awareness**: Keeping up with industry trends, competitors, and [economic conditions](https://www.financealliance.io/what-is-economic-analysis-the-question-every-cfo-should-be-asking/) that affect the business. - **Revenue generation**: Identifying opportunities to increase sales, market share, or margins. - **Pricing and profitability**: Knowledge of pricing strategies and how to maximize profitability. - **Sales and marketing strategies**: Creating strategies to effectively position products/services in the market. - **Negotiation skills**: Managing deals, partnerships, and supplier agreements for commercial advantage. --- [6 proven negotiation tactics to seal the dealTime is money, especially when it comes to acquisitions. Deal fatigue can drag negotiations on for months and every day a deal remains unclosed is another day of lost opportunities and unrealized profits.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/FA_Framework_Tiles_5_complete_acquisitons.jpg)](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/) --- ## **15 tips to build** **business and commercial acumen** Here are 15 quick-fire tips to help you sharpen your business acumen skills as fast as possible. 🚀 ### **1\. Understand the big picture** Don't just focus on numbers in isolation. Ask yourself how they fit into the larger vision of the business and its overall goals. If you can, attend strategy meetings. They’ll help clarify your company's mission and track progress toward goals. The more you know about the business's direction, the more you'll understand its financial decisions. ### **2\. Follow the money** Track where revenue comes from and how it’s used. Knowing how money moves in and out will help you make smarter decisions. It’s worth taking time to map out how revenue is generated and what drains cash (expenses, investments, etc.). Understanding the full journey of a dollar can help you forecast better and spot issues *before* they become problems. ### **3\. Get to know your customers** Although you may work in finance rather than a customer-facing role, it’s still worth getting to know your customers. Who are they? What are the pain points your product or service solves for them? If you don’t grasp these details, it becomes much harder to align financial decisions with what really drives value. 💡 ****Tip**: Try sitting in on customer calls and attending a few of your sales and marketing team meetings. Analyze customer purchasing behavior from a financial perspective. ### **4\. Learn the lingo** To be taken seriously and contribute, you must speak the same language. You’re probably familiar with a lot of ‘business jargon’ as it is. Terms like ROI (Return on Investment), EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), and others, often pop up in casual conversation in the office and meetings. If you’re unsure about something, do a quick Google search and try to remember the key ones used by your colleagues and employer. --- [How to use ChatGPT Canvas for finance & FP&AOpenAI has just dropped a game-changer for ChatGPT users: Canvas. This new tool opens in a separate window, making it easier than ever to collaborate with ChatGPT on specific projects.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/10/FA_Website_Article_Images_Stock--4-.png)](https://www.financealliance.io/chatgpt-canvas-for-finance-fp-a/) --- ### **5\. Build relationships across departments** Finance touches every part of the business. So, it doesn't hurt to know how other departments work and gather intel on their processes and priorities. The more you know, the better your decisions will be because you'll have a broader understanding of the business. ### **6\. Keep an eye on competitors** ![](https://media.tenor.com/7H7A-cr4IB4AAAAC/fcdk-boma.gif) What are your competitors doing differently? Analyze their financials and strategies to spot opportunities or risks for your own company. You could try studying competitors' financial reports, press releases, or news articles. Are they launching new products? Cutting costs? Expanding into new markets? Compare their strategies to your company's performance. This will help you spot trends or gaps you can address. ### **7\. Always think ROI** Whether it's a new project or an investment, always ask: What’s the return on this? Thinking like this helps align finance with business decisions. Every dollar the company spends should drive some sort of value. Developing strong business and commercial acumen ensures you’re aligning financial resources with business outcomes. If the numbers don’t stack up, it’s time to challenge or rethink the decision. ### **8\. Understand costs, not just revenue** Sure, revenue is exciting, but it’s not the full story. What really matters is the margin—what’s left *after* costs are covered. Dig into cost structures and identify areas where expenses can be optimized. Knowing the difference between fixed and variable costs, and how to manage each, can help improve profitability. This will also help in pricing decisions, ensuring your company stays competitive. ### **9\. Stay current on market trends** Markets change, and the best finance professionals know how to adapt. Keeping up with trends helps you forecast better and find new opportunities. To help with this, read about market trends and follow industry news. Subscribe to business podcasts, or set up Google Alerts for your industry. Consider how trends, like tech advances or economic shifts, could impact your business model. --- [Winning over the C-Suite & managing change resistanceChange is inevitable. But why do so many change initiatives fail, even when we, as leaders, embrace new technologies and strategies? In this article, we’ll dig into these hurdles and share some practical strategies for building a strong, flexible business culture that can thrive through change.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceShehryar Gilani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/10/Copy-of-FA_Website_Article_Images_Author_Highlight--15-.png)](https://www.financealliance.io/winning-over-the-c-suite-managing-change-resistance/) --- ### **10\. Dive into financial metrics that matter** Knowing which [metrics](https://www.financealliance.io/infographic-financial-performance-metrics/) matter most helps you focus on what drives performance. KPIs like profit margins, return on equity, and cash flow tell the real story. Master them to understand how finance drives the business. ### **11\. Shadow a colleague** ![](https://media.tenor.com/GxSnHeO9YhAAAAAC/following-you-national-geographic.gif) To understand how finance affects other parts of the business, step out of your comfort zone. Walk in someone else's shoes. Spend a day (or a few hours) with a non-finance colleague such as someone in sales or customer service. This will give you a new perspective as you’ll see their unique challenges and decision-making process firsthand. In turn, you’ll be able to provide new solutions and ideas on how finance can support them further. ### **12\. Simplify, don’t complicate** Great business and commercial acumen comes from explaining complex financial concepts so non-finance pros can understand. So, what does this look like for you? It's about turning numbers into stories that non-finance people can understand. To do this, you could use visuals like [financial charts and graphs](https://www.financealliance.io/financial-charts-and-graphs/) to break down concepts. Remember to connect the dots between the numbers and the business outcomes they represent. ### **13\. Take calculated risks** Businesses often need to take risks to grow, and you can be the one who helps ensure those risks are smart. Use [financial analysis](https://www.financealliance.io/what-is-financial-planning-and-analysis/) to weigh the pros and cons of risky projects or investments. Present scenarios, and don’t be afraid to recommend bold moves if the numbers support it. It’s about balancing caution with opportunity. ### **14\. Know when to zoom in and out** Details are important but don’t get lost in them. Switch between high-level business strategy and nitty-gritty numbers when needed. For example, in a financial report, know when to dig into specifics, like cost breakdowns. And, know when to give a high-level summary that ties it back to business strategy. Switching between both modes will make you a more agile and effective decision-maker. ### **15\. Keep learning** Improving business and commercial acumen doesn’t happen overnight. You have to stay on top of it by continuously learning. Take online courses, attend workshops or [network with other finance professionals](https://www.financealliance.io/11-networking-in-finance-tips/). Even reading a few business books or blogs now and again can keep your skills sharp. The more you learn, the more valuable you become. --- ## Common FAQs What does acumen mean in business? Acumen in business refers to the ability to make smart, quick decisions that drive business success. It involves understanding how a company operates, its financial health, and how to navigate challenges to achieve strategic goals. What is an example of business acumen? An example of business acumen is identifying a new market opportunity based on trends and strategically launching a product that boosts company revenue while staying ahead of competitors. What is an example of commercial acumen? An example of commercial acumen is negotiating a supplier deal that reduces costs without sacrificing quality, ensuring the business remains profitable and competitive in its industry. How do you demonstrate commercial acumen? You can demonstrate commercial acumen by making decisions that balance profitability with business strategy—such as optimizing budgets, identifying cost-saving opportunities, and driving revenue through innovative pricing or marketing tactics. How do you describe business acumen on a CV? On a CV, you can describe business acumen as your ability to drive strategic initiatives, optimize financial performance, and make informed decisions that contribute to business growth and profitability. --- ## **Want to build your business and commercial acumen further?** Struggling to turn your financial insights into real influence? Do you feel like your expertise isn’t making the impact it should? It’s time to change that! The [**Business Partnering and Storytelling Certified Masters**](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters) course will teach you to be the ultimate finance business partner and a master storyteller. This certification, by Christian Wattig of FP&A Prep, gives you instant access to five hours of video lessons, slides, and examples. They will teach you to build relationships, provide insights, and turn complex data into compelling stories. So, the real question is - are you ready to claim your seat at the decision-making table? [Learn more](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters) ### 6 steps to transform FP&A into a platform for strategic alignment URL: https://www.financealliance.io/6-steps-to-transform-fp-a-into-a-platform-for-strategic-alignment/ Last updated: 2025-10-23T08:48:47.000Z Financial planning, often perceived as a tedious and bureaucratic process, can be transformed into a powerful tool for strategic alignment, driving the success and cohesion of the entire organization. For leaders across various departments who face challenges in engaging their teams with the company’s financial goals, there's a significant opportunity to redefine how we view and utilize financial planning. Here are six steps (and tips) to transform financial planning into a platform for strategic alignment: ## 1\. The kick-off meeting: Setting the foundation The first and most critical step in the [financial planning process](https://www.financealliance.io/10-big-picture-financial-planning-steps/) is a well-structured kick-off meeting. This meeting should lay out the goals for the planning cycle and clearly explain how these goals connect to the company's broader strategic objectives. During this session, the role and responsibilities of each functional leader must be defined, ensuring they understand their part in the process. Most importantly, the meeting should emphasize that planning is a *collective* exercise. It’s not just about the finance department dictating numbers, but rather a collaborative effort where every leader contributes their insights and expertise to align departmental strategies with overall business objectives. This initial meeting creates a shared understanding and sense of ownership, making it easier to foster commitment and engagement throughout the entire process. --- [FP&A Summit speaker spotlight with Dani MartinsDani draws from years of experience in transforming finance teams globally, revealing exclusive insights to help you unlock new levels of success and create more resilient, future-ready teams.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-16.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--8-.png)](https://www.financealliance.io/fp-a-speaker-spotlight-with-dani-martins-2/) --- ## 2\. Financial education for non-financial managers The next crucial step is providing financial education to leaders outside the finance function. Equipping managers with financial knowledge not only enhances their understanding of the numbers, but also fosters a partnership mindset. When managers grasp the financial impact of their decisions, they are more likely to align their strategies with the broader objectives of the organization. This understanding creates an environment where financial goals are no longer seen as arbitrary figures but as shared targets to be achieved together. ## 3\. Engagement and alignment with financial goals Engaging business units with the company's financial objectives is key. This alignment starts with clear and consistent communication. Managers should be encouraged to take part in the financial planning process from the outset, offering valuable insights and feeling invested in setting targets. Implementing methodologies like [Beyond Budgeting](https://corporatefinanceinstitute.com/resources/fpa/beyond-budgeting/#:~:text=Beyond%20Budgeting%20is%20the%20idea,adaptive%20set%20of%20management%20processes.) can revolutionize this process, making it more agile and adaptable. Beyond Budgeting promotes a continuous, flexible approach, moving away from rigid fixed budgets and encouraging a [culture of innovation and accountability](https://www.financealliance.io/financial-accountability/). ## 4\. Building strong relationships Building strong relationships between the financial planning team and other departments is essential. This relationship should be grounded in mutual trust and respect, where the finance team is viewed not merely as cost controllers but as strategic partners. Regular meetings, cross-departmental workshops, and open communication all help to strengthen these ties, ensuring that everyone works towards a shared goal. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-17.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FP-A-career-salary-and-path-2-1.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## 5\. Performance tracking and continuous feedback For the financial planning cycle to truly serve as a platform for strategic alignment, it must not end once the initial plan is set. A robust system of performance tracking and continuous feedback is essential. Regularly monitoring financial and non-financial KPIs ensures that departments remain aligned with the company’s strategic objectives throughout the year. To make this effective: - **Establish Key Performance Indicators** (KPIs) that are closely linked to both financial targets and strategic goals, ensuring that progress is measurable. - **Schedule regular review meetings** where progress is assessed, and any necessary adjustments to the plan can be made. These meetings should include open discussions on challenges and opportunities, with a focus on keeping departments aligned and agile in response to evolving market conditions. - **Foster a culture of continuous feedback**, encouraging leaders and teams to share insights, learn from both successes and shortfalls, and collectively recalibrate their strategies as needed. This ongoing process of monitoring and adjusting the plan ensures that financial planning is not just a one-time event but a dynamic tool that supports strategic agility and long-term success. ## 6\. Benefits for all stakeholders When financial planning is treated as a platform for strategic alignment, the benefits extend to all stakeholders. The company is able to meet its financial goals more effectively, while teams in other areas gain a greater sense of ownership and involvement in the outcomes. [Investors](https://www.financealliance.io/cfos-role-in-investor-communications/) and shareholders see a cohesive, well-managed organisation, which can boost confidence and investment. Customers, in turn, benefit from an organisation that operates more efficiently, delivering higher quality products and services. ### To conclude... In summary, transforming financial planning into a platform for strategic alignment requires a shift in mindset and the adoption of innovative practices. Financial education, continuous engagement, the building of strong relationships, and performance tracking are the pillars of this transformation. As financial planning professionals, we have the opportunity to lead this change, fostering a culture of collaboration and partnership that benefits the entire organisation. Let’s reimagine financial planning together and build a future where all stakeholders emerge as winners! --- ## **Join Daniele at the FP&A Summit in London** Want to learn more about how to transform your financial planning approach and harness the power of human skills in the age of AI? Don’t miss Daniele Martins’ session, **"Beyond Automation: Elevating Human Skills in the Age of AI"**, at the FP&A Summit London on **November 6, 2024!** Discover how to blend cutting-edge AI tools with critical thinking, creativity, and strategic insight to lead in today’s evolving financial landscape. Gain insights from industry leaders and walk away with actionable strategies to not just adapt, but thrive. [Register now](https://events.financealliance.io/location/london/register) ### Winning over the C-Suite & managing change resistance URL: https://www.financealliance.io/winning-over-the-c-suite-managing-change-resistance/ Last updated: 2025-10-30T13:06:26.000Z *\[This article is based on a presentation given by* [*Shehryar Gilani*](https://www.linkedin.com/in/shehryar-gilani/)*, Director of Financial Planning and Analysis and Performance at L&Q at our FP&A Summit, London in 2023\. Catch up with this presentation, and others, using our* [*OnDemand service*](https://www.financealliance.io/ondemand/)*. For more exclusive content, visit your* [*membership dashboard*](https://www.financealliance.io/pro-plus-membership-dashboard/)*.\]* Change is inevitable. But why do so many change initiatives fail, even when we, as leaders, embrace new technologies and strategies? This question has been on my mind for a while, and I believe it boils down to three key factors: **fear**, **despondency**, and **change fatigue**. In this article, we’ll dig into these hurdles and share some practical strategies for building a strong, flexible business culture that can thrive through change. **Topics covered:** - [Why do 75% of change projects fail?](https://www.financealliance.io/p/3f932767-adec-4198-a078-e58fabf3adaa/#why-do-75-of-change-projects-fail) - [Emotional buy-in](https://www.financealliance.io/p/3f932767-adec-4198-a078-e58fabf3adaa/#the-secret-to-successful-change-emotional-buy-in) - [Speak their language](https://www.financealliance.io/p/3f932767-adec-4198-a078-e58fabf3adaa/#selling-the-change-speak-their-language) - [The final mile](https://www.financealliance.io/p/3f932767-adec-4198-a078-e58fabf3adaa/#adopting-change-the-final-mile) - [Presenting change to the C-suite](https://www.financealliance.io/p/3f932767-adec-4198-a078-e58fabf3adaa/#how-to-present-change-to-the-c-suite) - [Knowing your audience](https://www.financealliance.io/p/3f932767-adec-4198-a078-e58fabf3adaa/#knowing-your-audience) - [Closing the loop & ensuring successful change](https://www.financealliance.io/p/3f932767-adec-4198-a078-e58fabf3adaa/#closing-the-loop-ensuring-successful-change) --- ### Why do 75% of change projects fail? Did you know that three-quarters of change projects fail? That’s a staggering statistic, and it’s not because leaders lack good ideas or [the right tools](https://www.financealliance.io/10-best-financial-modeling-tools/). It’s about people. Human emotions, resistance, and lack of buy-in can cripple even the most well-structured initiatives. When I look back on projects that have faltered, I see three recurring themes: ### Fear People fear change because it threatens their sense of competence. For example, early in my career, I was known as the “Excel Guru.” Back then, VLOOKUP was groundbreaking, and people would come to me for advice. But when a new hire came in who was faster and more skilled, I felt threatened. This fear is universal. People worry about being exposed as less competent or becoming obsolete. Addressing these fears head-on and showing how change enhances roles rather than diminishes them is critical. ### **Despondency** Despondency often arises from repeated failed attempts at change. Teams have seen initiatives come and go, often without long-term success. The result? A pervasive attitude of, *“Why should I bother? It won’t work.”* To counter this, leaders need to demonstrate that *this time* is different - because it’s backed by thoughtful planning and a focus on outcomes. ### **Change fatigue** We live in a world where changes are happening at breakneck speed. I’ve been guilty of what my wife calls the “squirrel complex” - chasing every shiny new idea and losing focus on the current project. This constant pivoting leads to change fatigue, leaving teams drained and disillusioned. Leaders must prioritize, communicate effectively, and ensure that each change is thoughtfully managed, rather than jumping from one initiative to another. _This post is for paying subscribers only._ ### FP&A Summit Spotlight with Jon Yuregir URL: https://www.financealliance.io/fpa-summit-spotlight-jon-yuregir/ Last updated: 2024-10-10T09:10:56.000Z Get ready for an inspiring session at the [**FP&A Summit in London**](https://events.financealliance.io/location/london) on November 6, 2024, as we welcome [Jon Yuregir](https://www.linkedin.com/in/jon-yuregir-6b87904/), Head of Financial Planning and Analysis at easyJet PLC. Jon will be sharing his insider secrets in his talk, *“Fast-tracking Your FP&A Career: Insider Tips, Success Stories, and Networking Strategies.”* Whether you're just starting out in finance or looking to take your career to the next level, this session is packed with actionable advice - from building your technical expertise to developing essential soft skills like leadership and communication. But it’s not just about what you know—it’s also about *who* you know. Jon will dive into the power of professional networking and how to leverage connections to open new doors and advance your career . [Download our event brochure](https://events.financealliance.io/location/london/downloadbrochure) ### Can you tell us about yourself? My name is Jon Yuregir, I’m the Head of Financial Planning and Analysis at easyJet PLC, a FTSE 100 low cost European airline. I look after the long term and short term financial planning cycle, including mid term plan, budgeting and [rolling forecasts](https://www.financealliance.io/rolling-forecast-best-practices/). I also business partner the corporate overheads department. Alongside my love of aviation & travel, and having a loving, if sometimes chaotic home life (three kids, of which two twin boys, a dog, and three chickens), I like endurance sports such as triathlon. I also have a keen interest in cultures, languages, ethnicity and migratory flows. I’ve been fortunate enough to be able to pursue this interest by becoming a trustee for the European Network on Statelessness, a civil society alliance that promotes the right to a nationality in Europe. ### What will you be speaking about at our event? I will be talking about my career journey to date, the key decisions I had to take at various junctures, where I’ve taken risks, where I’ve been deliberate in seeking out a direction I wanted to go in, and where I’ve gone with the flow. I’ll also touch upon my experience of working with a range of very able FP&A professionals, and explain that there's no 'one mould' of personality type, or experience. ### What is the key takeaway you hope attendees will gain from your talk? - Is FP&A for you? - [How to get into FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) (if you aren’t already in a FP&A role), routes from audit/financial control, commercial and how to progress up the ranks - Building a high achieving [FP&A team](https://www.financealliance.io/fp-a-team-structure/) is about ensuring that team members have complimenting skillsets. And if you're a one-man band, how to navigate your areas for development whilst showcasing your strengths. - Systems thinking, automation and process simplification ### Who is your ideal attendee for this event? Someone either just starting out in FP&A and wanting guidance on how to progress, or someone in other areas of finance who want to transition into FP&A. --- [FP&A Summit speaker spotlight with Liudmila GudinaWe’re super excited to have Liudmila Gudina, Fagron’s Global Working Capital Manager, join us for a chat before her big session at the FP&A Summit in London!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-12.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--2-3.png)](https://www.financealliance.io/fp-a-summit-speaker-spotlight-with-liudmila-gudina/) --- ### What are you looking forward to the most about the event? The opportunity to speak to other delegates, presenters and network. ### Can you provide a brief teaser of what attendees can expect from your presentation? Given I work in the aviation sector, I will try and storyboard my presentation in a similar theme to taking a journey. There are many parallels between an FP&A career and taking a plane journey. From gaining a fast track at the airport, to knowing where your destination is, dealing with unforeseen detours, ensuring brilliant customer service throughout. ### What advice would you give to young professionals starting out in the finance industry? Be curious, be competent, be a fixer. Try to make your manager’s life as easy as possible and take opportunities to act up. But also be authentic and portray a personality that brings in aspects of your interests and character outside of work. --- ## **Join us at the FP&A Summit London!** Unleash the full strategic potential of your financial planning & analysis function at the FP&A Summit in London on November 6! Join FP&A leaders as they share best practices and common challenges to keep you up-to-date with the latest innovations and skills you need to increase forecasting accuracy, integrate AI and automation and drive growth through business partnering. See you at the [**FP&A Summit in London**](https://events.financealliance.io/location/london)! [Learn more about the event](https://events.financealliance.io/location/london/) ### How to use ChatGPT Canvas for finance & FP&A URL: https://www.financealliance.io/chatgpt-canvas-for-finance-fp-a/ Last updated: 2025-10-30T13:05:24.000Z OpenAI has just dropped a game-changer for ChatGPT users: Canvas. This new tool opens in a separate window, making it easier than ever to collaborate with ChatGPT on specific projects. Think of it like a virtual whiteboard where you can brainstorm, write, and even code. Need [Python](https://www.financealliance.io/how-to-use-chatgpt-with-python/) code? Ask ChatGPT to generate it, highlight a specific section, and request further edits. It's like having a personal AI assistant right at your fingertips. OpenAI is clearly aiming to stay ahead of the curve and provide users with even more reasons to subscribe to their premium service. But Canvas isn't just for casual users. It's also a *big* deal for finance and FP&A professionals, who'll find it especially useful for data-driven projects. ![ChatGPT Canvas in finance](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/10/Chatgpt-canvas.webp) **Source:* [**OpenAI*](https://openai.com/index/introducing-canvas/) From crunching numbers to crafting better financial presentations, Canvas has got you covered. But it's not just about the data. Canvas understands the broader financial context. Keep reading to learn more about what this new interface is and how you can use ChatGPT Canvas for finance and FP&A. **Table of contents:** - [What is ChatGPT Canvas?](https://www.financealliance.io/p/e7b2566c-562c-48b7-aec2-e0f9abe77369/#what-is-chatgpt-canvas) - [Canvas shortcuts for writing and coding](https://www.financealliance.io/p/e7b2566c-562c-48b7-aec2-e0f9abe77369/#canvas-your-new-financial-ai-co-pilot) - [Using ChatGPT Canvas in finance](https://www.financealliance.io/p/e7b2566c-562c-48b7-aec2-e0f9abe77369/#using-chatgpt-canvas-in-finance) ## **What is ChatGPT Canvas?** ChatGPT Canvas is a new tool that makes working on bigger writing and coding projects easier. According to [OpenAI](https://openai.com/index/introducing-canvas/): > *"Human evaluations assessed canvas comment quality and accuracy functionality. Our canvas model outperforms the zero-shot GPT-4o with prompted instructions by 30% in accuracy and 16% in quality."* This suggests that Canvas is a significant improvement over previous versions of ChatGPT, offering users more accurate and helpful feedback. Here are some special features to note: **Canvas opens in a new window**, so you can focus on longer projects or more complicated code. **Edit your text or code side-by-side**. This means you can highlight specific parts of your text or code to ask for suggestions. **Canvas has built-in features** like: - Making your text longer or shorter. - Changing the reading level. - Adding comments to your code or finding bugs. Worried about losing your work? Well, now you don’t have to. Canvas keeps track of all your previous versions, so you can easily go back to earlier versions of your project if you need to. The best news, though? ChatGPT Canvas is tailored for the type of tasks that finance and FP&A professionals use almost daily. Suddenly, things like financial modelling, [scenario analysis](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/), reporting, and [data visualization](https://www.financealliance.io/storytelling-with-data-visualization-playbook/) are made easy. With Canvas, you have a dedicated space to work on complex data sets and financial stories. --- [How to use ChatGPT with PythonEven without deep Python knowledge, you can use ChatGPT to write Python code in a matter of seconds – and in this blog post, we’ll teach you how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-9.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Python-ChatGPT.png)](https://www.financealliance.io/how-to-use-chatgpt-with-python/) --- ## Canvas: Your new financial AI co-pilot With Canvas, ChatGPT becomes a more effective financial analyst (and assistant). It can better understand the context of your work, thanks to the ability to highlight specific sections. Think of it as a human copy editor or code reviewer, offering inline feedback and suggestions while keeping the entire project in mind. But Canvas isn't just a passive observer. *You're* in complete control. You're free to edit text or code directly, and use the handy shortcut menu to request adjustments like changing writing length, debugging code, or adding emojis. Need to undo a change? The back button is there to save the day. Canvas opens automatically when ChatGPT thinks it can help, but you can also force it to open by including "use canvas" in your prompt. ### **ChatGPT Canvas: Writing shortcuts for finance** - **Suggest edits:** Get tailored suggestions for financial reports, analyses, or presentations. - **Adjust the length:** Make your content more concise or expand it for greater detail. - **Change reading level:** Ensure your audience, whether technical or non-technical, can easily understand your work. - **Add final polish:** Check for financial errors, inconsistencies, and clarity. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/10/shortcut-video.webp) **Source and image credits:* [**OpenAI*](https://openai.com/index/introducing-canvas/) ### **ChatGPT Canvas: Coding shortcuts for financial applications** - **Review code:** Get feedback on your financial models or algorithms. - **Add logs:** Debug your code more efficiently with added logging statements. - **Add comments:** Improve code readability and maintainability for financial applications. - **Fix bugs:** Identify and correct errors in your financial calculations or models. - **Port to a language:** Translate your code into JavaScript, TypeScript, Python, etc. --- [Introducing FP&A Certified: CoreTake your career to the next level with our FP&A Core course. Learn to forecast, budget and turn complex data into insights that drive profitable business growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-10.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_FP-A_Core_Meta_-1.png)](https://www.financealliance.io/introducing-fp-a-certified-core/) --- ## **Using ChatGPT Canvas in finance** ChatGPT Canvas is built to help professionals manage more complex projects, and in the world of finance, that means making financial modeling, [forecasting](https://www.financealliance.io/how-to-turn-forecasting-budgeting-mistakes-into-milestones/), and reporting more efficient and collaborative. Here’s how it can help you in your daily work: ### **1\. Building and refining financial models and forecasts** Financial modeling can be really detail-heavy. You’re juggling data, making assumptions, and constantly refining your numbers. With Canvas, you can do all of that more interactively. Imagine you're building a revenue forecast for the next year. You put in your assumptions: growth rates, cost changes, seasonal spikes, and so on. Instead of having to do all the adjustments manually, Canvas acts like a [smart co-pilot](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/). You can highlight parts of your model that you're unsure about, and [ChatGPT](https://www.financealliance.io/chatgpt-for-excel/) will jump in with suggestions to help you tweak formulas or refine your assumptions. ### **2\. Running ‘what if’ scenarios** [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) often means answering the dreaded “What if?” questions. What if we increase marketing spend? What if raw materials get cheaper? Canvas makes these scenarios less stressful. Say you want to see how a 5% increase in marketing spend in Q2 affects the year-end results. Just type that into Canvas, and it’ll recalculate everything for you - showing you how revenue changes, how margins shift, and even giving you quick graphs to illustrate the impact. You can also save different versions in Canvas, so you’re ready for any follow-up questions from senior management or the CEO. ### **3\. Better visuals, ready for presentations** Turning all your hard work into something that’s easy to present to non-finance folks can be one of the trickiest parts of FP&A. Canvas helps here too. Let’s say you’ve [built a forecast](https://www.financealliance.io/rolling-forecast-best-practices/) and now need to present it to the leadership team. Canvas can help generate clear, [effective charts](https://www.financealliance.io/financial-charts-and-graphs/) that tell the story of your data—like a line graph showing the projected revenue over the next few quarters, with comments explaining key assumptions. Need a visual that compares a “best-case” vs. “worst-case” scenario? Canvas can pull that together for you, making sure you’ve got a polished presentation that’s easy to understand and ready to go. --- [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-11.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/finance-charts.png)](https://www.financealliance.io/financial-charts-and-graphs/) --- ### **4\. Easier budgeting and variance analysis** We all know [budgeting](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) is a beast, and it’s never done just once. There’s always [variance analysis](https://www.financealliance.io/the-variance-analysis-cycle/) \- comparing what you planned vs. what actually happened. Canvas can help you get to the "why" behind the numbers. For example, if your operating expenses were much higher than planned last quarter. You can input those numbers and ask ChatGPT to spot where things went off track. It can add inline comments, helping you zero in on why those variances happened. ### **5\. Speeding up monthly reporting** [Monthly and quarterly closes](https://www.financealliance.io/month-end-close-checklist/) can be a mad rush. With Canvas, preparing those reports gets a whole lot faster and more accurate. You might have a draft of your monthly financial summary—Canvas can help you make it more concise and fix any grammar issues, etc. You can ask it to make the tone more friendly if you’re writing for a broader audience or more formal for executive-level reports. Plus, Canvas can also help make your data come to life visually, adding small but effective graphics or even emojis to help emphasize key points. It’s these small touches that can make a big difference when you’re [presenting to stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) who just need the high-level view. --- ## Become an Insider Member Join 1,000+ rising finance stars who trust Finance Alliance to be their preferred learning and development hub. Benefit from our community-led resources through the [Insider plan](https://www.financealliance.io/insider-membership-plan/), for free! Access expert insights, community, courses, templates and more to boost your finance skills and career. ✔Templates & frameworks ✔ Exclusive content & community events ✔ Finance Alliance Slack community ✔ Ungated access to all reports ✔ Hours of real-world case studies ✔ Weekly newsletters ✔ Finance IQ *(coming soon)* ✔ FA GPT *(coming soon)* No catches, no monthly bills – 100% free, *forever*. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_3.png) ](https://www.financealliance.io/insider-membership-plan/) ### ### CFO Summit Speaker Spotlight with Tom Kelly URL: https://www.financealliance.io/cfo-summit-speaker-spotlight-with-tom-kelly/ Last updated: 2024-10-02T14:25:54.000Z The role of AI in transforming finance is *undeniable* and finance leaders today need more than just traditional tools to stay competitive - they need to future-proof their finance functions with AI-driven solutions. Join us at our upcoming workshop at the [**CFO Summit in Boston**](https://events.financealliance.io/location/boston) (October 8), *Future-proofing Finance with AI-driven Cloud Solutions*, where a top industry expert will break down exactly how AI is transforming finance. From automating routine tasks to driving strategic decision-making, you'll learn how AI is reshaping everything from forecasting to risk management. One of our featured speakers is [Tom Kelly](https://www.linkedin.com/in/tkcloud/), Sr. Director of Product Marketing/Management for [Oracle NetSuite’s](https://www.netsuite.com/portal/home.shtml) Global Business Unit, responsible for Global Cloud Financials. With his extensive experience spanning Fortune 500 companies like PepsiCo and eFunds, as well as high-growth startups, Tom brings a wealth of knowledge on leveraging cloud and AI solutions to optimize financial operations. We caught up with Tom to learn more about his journey and get a sneak peek into his session, where he’ll be sharing how AI-driven cloud solutions are transforming finance functions for the future.👇 [Request an invite](https://events.financealliance.io/location/boston/requestaninvite) ### Hi Tom, welcome to the CFO Summit Speaker Spotlight series! Can you tell us about yourself? My background, while extensive, is not traditional. As a native New Yorker, I went down south on a scholarship to play baseball and obtain an accounting degree from NC State. After a year in the minor leagues, I couldn't pass up the opportunity for a career in accounting and spent two years in public accounting. I then joined a premier finance and marketing company – PepsiCo. It was there that I embraced and honed my skills in finance, technology, human resources, operations and marketing and found my passion for improving business and making things better no matter how big or small. An early adopter on leveraging the Cloud, I use my leadership and transformation skills to turn strategy and vision into reality. At Oracle NetSuite, I am storyteller, product marketer and product strategist, helping define product offerings, competitive positioning, messaging, go to market strategy and analyst relations. Prior to joining Oracle NetSuite, I ran my own business T-Edward, Inc., a strategic and operational Cloud consultancy providing CXO services and Cloud expertise. ### What will you be speaking about at our event? I will explore how AI is reshaping financial operations and strategies. Attendees will learn practical steps to integrate AI tools, enhance decision-making, and safeguard against future challenges. I will also share success stories from leaders who have effectively future-proofed their finance functions and discovered how to turn AI-driven change into a competitive advantage. --- [CFO Summit Speaker Spotlight with David ForlizziJoin us at the CFO Summit in Boston on October 8th to learn how to effectively protect your organization’s financial assets. Hear from industry leaders and experienced CFOs who will share their best practices and insights.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-7.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Sharing_Article_Images_Author-Text--15--2.png)](https://www.financealliance.io/cfo-summit-speaker-spotlight-with-david-forlizzi/) --- ### What is the key takeaway you hope attendees will gain from your presentation? That you actually can teach an old dog new tricks…. ### Who is your ideal attendee for this event? Accounting and finance professionals. I will provide insight to where accounting/finance is going, the vision, strategy and tactics to get there and how AI can be their friend and not their enemy. ### What are you looking forward to the most about the event? Making everyone’s day! ### Can you provide a brief teaser of what attendees can expect from your presentation? I plan on evoking both laughter and tears from the audience in a powerful achievement in storytelling and performance. ### What’s the best career advice you’ve ever received? Maya Angelou: People will not always remember what you said or did, but they will always remember how you made them feel. --- [FP&A Summit speaker spotlight with Liudmila GudinaWe’re super excited to have Liudmila Gudina, Fagron’s Global Working Capital Manager, join us for a chat before her big session at the FP&A Summit in London!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-8.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--2-2.png)](https://www.financealliance.io/fp-a-summit-speaker-spotlight-with-liudmila-gudina/) --- ### What advice would you give to young professionals starting out in the finance industry? An adaptation of a quote attributed to Mark Twain: Good decisions come from experience. But experience comes from bad decisions. This is life so, never regret. Learn from mistakes and move forward. ### How can attendees connect with you after the event to learn more? You can connect with Tom via his [LinkedIn account](https://www.linkedin.com/in/tkcloud/). --- ### About Tom Tom Kelly is the Sr. Director Product Marketing/Management for the Oracle NetSuite Global Business Unit, responsible for Global Cloud Financials. Before joining Oracle NetSuite, Tom founded T-Edward, a strategic and operational cloud consultancy providing cloud expertise and CXO services from companies in the Fortune 500 to start-ups. Prior to T-Edward, Tom held a variety of executive financial and technology related positions with large cap companies including PepsiCo, eFunds and Deluxe Corporation, as well as small cap, privately held entities such as FullContact and PeopleNet Communications. --- ## Join the CFO Summit Boston! Break free from the daily grind and join us at the CFO Summit in Boston on October 8, 2024\. CFO Summit is an exclusive, invite-only gathering of senior finance leaders who come together to share success stories and industry insights to work through the prevailing challenges facing CFOs today. - Pick the brains of seasoned decision-makers to hone your financial strategy. - Revitalize and find inspiration by taking a break from the daily routine. - Absorb knowledge from leading CFOs and understand market-shifting trends. - Unite with your peers and establish new connections. [Request an invite](https://events.financealliance.io/location/boston/requestaninvite) ### Why FP&A teams are the guardians of the company URL: https://www.financealliance.io/why-fp-a-teams-are-the-guardians-of-the-company/ Last updated: 2024-11-26T15:10:53.000Z *\[This article is based on a presentation given by Vaughn Grandin, Head of Financial Modelling at Teneo at our FP&A Summit, London in 2023\. Catch up with this presentation, and others, using our* [*OnDemand service*](https://www.financealliance.io/ondemand/)*. For more exclusive content, visit your* [*membership dashboard*](https://www.financealliance.io/pro-plus-membership-dashboard/)*.\]* You’ve heard about superheroes saving the day in comic books, right? Well, in the corporate world, [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) (Financial Planning & Analysis) professionals are the unsung heroes guarding the company from financial disaster. They've become vital members of the team, helping to navigate risks and drive growth… but are they *really* the guardians of the company? I certainly think so, and in this article, I explain why I believe that’s the case by sharing key insights on the importance of FP&A in protecting companies and practical ways these professionals safeguard their organizations. **Topics covered:** - [Why FP&A is future-focused](https://www.financealliance.io/p/1c46bf23-7b9e-4464-8ae2-b9ec4683111d/#looking-ahead-why-fpa-is-future-focused) - [The risks businesses face today](https://www.financealliance.io/p/1c46bf23-7b9e-4464-8ae2-b9ec4683111d/#the-risks-businesses-face-today) - [Why ignoring warning signs is a costly mistake](https://www.financealliance.io/p/1c46bf23-7b9e-4464-8ae2-b9ec4683111d/#why-ignoring-warning-signs-is-a-costly-mistake) - [How FP&A protects the company](https://www.financealliance.io/p/1c46bf23-7b9e-4464-8ae2-b9ec4683111d/#how-fpa-protects-the-company) **Become a* [**Pro member*](https://www.financealliance.io/signup/) *to access the full session and more valuable content* ## **Looking ahead: Why FP&A is future-focused** FP&A isn’t just about looking at where the company has been; it’s about forecasting where it’s *going*. They provide insights on Key Performance Indicators (KPIs) - things like revenue growth, operating costs, and profit margins. Their goal is to give decision-makers the information they need to understand the full picture and plan for what’s next. In a world that changes as fast as ours, businesses can’t afford to sit still. Markets shift, consumer behaviors change, and external factors (like global pandemics) can throw everything into chaos. *That’s* why the work of FP&A is so important: they’re constantly looking forward, helping to protect the company from risks and serious consequences. FP&A is *not* a one-time exercise. It’s an ongoing process. [FP&A professionals](https://www.financealliance.io/7-reasons-why-fp-a-professionals-miss-the-bus/) are always monitoring the pulse of the company. Every week, every month, they’re adjusting the forecasts, making sure the business’s performance aligns with its goals. This regular check-in keeps companies agile and responsive. _This post is for paying subscribers only._ ### CFO Summit Speaker Spotlight with David Forlizzi URL: https://www.financealliance.io/cfo-summit-speaker-spotlight-with-david-forlizzi/ Last updated: 2024-09-25T13:44:22.000Z Did you know that CFOs play a pivotal role in safeguarding financial data? CFOs *must* be proactive in preventing fraud and cyberattacks. But where should you start? Join us at the [**CFO Summit in Boston**](https://events.financealliance.io/location/boston) on October 8th to learn how to effectively protect your organization's financial assets. Hear from industry leaders and experienced CFOs who will share their best practices and insights. One of our featured speakers is David Forlizzi, CFO of Veracode. David will be joining a panel discussion that will reveal insider secrets for outmaneuvering fraud and cyber threats. We caught up with David to hear more about him and the panel discussion, which will become the *ultimate* CFO's guide to cybersecurity.👇 [Grab your ticket](https://events.financealliance.io/location/boston/register) ## **Please introduce yourself and your current role.** Since 2019, I have served as the Chief Financial Officer for Veracode, Inc, which is a PE backed cybersecurity SaaS business that is a global leader in application risk management. In other words, Veracode helps software development and security teams to write and use secure code by identifying potential vulnerabilities that can be exploited by hackers. As CFO, I am often working closely with the product and go-to-market leaders to enable improved data for decision making as well as partnering on customer deal structuring. I started my career at PwC serving both public and private software clients. With PwC and a global software company, Infovista, I lived, worked and traveled in Paris, France for several years, where I became fluent in French. Outside of work, I enjoy cooking smoked pit BBQ in the summer months and snow skiing in the winter. --- [FP&A Summit speaker spotlight with Kavin SoniWelcome to another interview from our FP&A Summit speaker spotlight series with Kavin Soni!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/09/FA_Sharing_Article_Images_Author-Text--2-.png)](https://www.financealliance.io/fp-a-summit-speaker-spotlight-with-kavin-soni-from-google/) --- ## **What topics will you be discussing as a panelist at our event?** At the upcoming event, I shall be covering “preventing fraud and cyberattacks”, which is a topic closely related to my role at Veracode as well as Veracode’s core mission for our customers. While the job of IT and software security is never complete at any company, Veracode is often at the forefront in protecting itself from outside cyber threats. My goal is to share a perspective of what we have done at Veracode as well as other useful tidbits of knowledge that I have learned along the way during my professional career as CFO. ## **What is the key takeaway you hope attendees will gain from your insights on the panel?** The key takeaways to gain are: 1\. Prompting all financial leaders that they have a responsibility to influence and implement practices to secure a company from cyber-attacks. 2\. Sharing ideas and steps financial leaders can take with their company to reduce cyber risk. 3\. Raising awareness on how great this risk has become for all companies. --- [CFO interview questions and answersIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/08/CFO-interview-questions-2.jpg)](https://www.financealliance.io/cfo-interview-questions-and-answers/) --- ## **Who do you think would benefit most from attending this panel discussion, and why?** Any financial leader who is apart of an organization that has a corporate network, website, and private information that can be accessed from a network (pretty much everyone) can benefit from this topic. With the proliferation of software and digitalization of information, almost every company is exposed to cyber threats. The common saying in the industry is that it is not a question of “if” a company will become victim of a cyber-attack, it is more so a question of “when”. My goal is to cover some simple steps and perhaps less simple steps that financial leaders can take with their peers to reduce such risk or be more prepared in the event they ever become a victim of a cyber-attack. ## **What aspect of this event are you most excited about?** While I am certainly excited to discuss cybersecurity during the panel that I am participating, I am keen to hear the ways other financial leaders have been harnessing the benefits of artificial intelligence through tools in methods for FP&A and other means. While I don’t believe AI will replace humans in the near or mid term, financial leaders that know how to use AI will replace financial leaders that do not know how to leverage AI! ## **Can you share a little preview of the insights you’ll bring to the panel discussion?** During the panel on [Cyber risks and fraud](https://www.financealliance.io/cfo-cybersecurity/), my goal would be to raise awareness by sharing the experiences and best practices that I have had the privilege of having at my current employer Veracode. Not only do we get to see how our customers are addressing cyber risks, but also Veracode has made a lot of progress in maintaining process and policies to mitigate cyber risks. --- [FP&A Summit speaker spotlight with Liudmila GudinaWe’re super excited to have Liudmila Gudina, Fagron’s Global Working Capital Manager, join us for a chat before her big session at the FP&A Summit in London!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-3.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--2-1.png)](https://www.financealliance.io/fp-a-summit-speaker-spotlight-with-liudmila-gudina/) --- ## **What’s the best career advice you’ve received that has helped shape your journey?** It may sound a bit “corny”, but the best advice that I have received in my professional career is “The harder you work, the luckier you get”. There is a lot of truth in that advice! ## **What advice would you offer to young professionals starting their careers in finance?** Our education teaches us the importance of technical skills which is a high focus during the early years of our professional careers. Most of us have the skills to work in finance when graduating school. Two additional core focus areas that for not only early in a finance profession but also later in a person’s professional career are: Networking and Applied Learning. Networking is all about creating connections with as many financial and non-financial professionals as possible. The more positive relationships that are built….the more opportunities or help seizing opportunities are captured. Applied leaning sounds really basis……and it is. However, listening to feedback from your peers, hierarchy and teammates and adapting your work to fine tune your deliverables is extremely important, especially early on in a persons career. Everyone makes mistakes, however, making the same error or oversight on reports or data over multiple weeks or months quickly erodes trust. Listening to feedback and following up on improvements will often rise you to the category of top performer especially early on in your career. --- ## Join the CFO Summit Boston! Break free from the daily grind and join us at the CFO Summit in Boston on October 8, 2024\. CFO Summit is an exclusive, invite-only gathering of senior finance leaders who come together to share success stories and industry insights to work through the prevailing challenges facing CFOs today. - Pick the brains of seasoned decision-makers to hone your financial strategy. - Revitalize and find inspiration by taking a break from the daily routine. - Absorb knowledge from leading CFOs and understand market-shifting trends. - Unite with your peers and establish new connections. [Request an invite](https://events.financealliance.io/location/boston/requestaninvite) ### The #1 most important financial concept (for non-finance professionals) URL: https://www.financealliance.io/the-1-most-important-financial-concept-for-non-finance-professionals/ Last updated: 2025-04-04T14:58:19.000Z This article might be interesting for all non-finance professionals who wonder what financial theories and concepts are truly needed on a day-to-day basis. I will start with the most fundamental from my point of view theory, which is called [time value of money](https://www.financealliance.io/time-to-value-metric/) (or just TVM). The basis for this theory is an understanding that money received today is *not* the same money that someone promises you tomorrow, one year from now or even 10 years from today. Why exactly is that, you might wonder, do we plan to change our currency from dollars to something entirely different? No, of course not, but to understand this interesting concept you need to ask yourself a simple question: what can you do with money received today that you can’t do with money received, say, one year from now? You can’t invest them for one year and receive interest on your investments. And here I am not talking about risky investments, like the ones to equity markets, for example. I am mostly concerned with more standard savings accounts or certificates of deposit which might be even insured in some countries up to a certain limit, so even the most risk-averse person should not worry about losing their money. --- [5 startup financing and VC funding tipsLet me start by saying that fewer than 1 in 10,000 new businesses in the US receive venture capitalist (VC) funding, so being backed by VC is by itself a very difficult task…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceArtem Malinin, Ph.D, MBA![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/Copy-of-FA_Website_Article_Images_Author_Highlight--1-.png)](https://www.financealliance.io/5-startup-vc-funding-tips/) --- ## Risks associated with TVM Moreover, if you think about risks associated with deferred payments – is there really a guarantee that a person or a company that promised you a payment in the future will not go bankrupt during this one-year period? That’s why time value of money theory shows that money received today could be exchanged only for more money promised tomorrow considering opportunity costs, potential inflation as well as non-payment option in general. Inflation, for example, with prices rising much more frequently than one wants them to, will probably make the most sense nowadays, even for people from developed countries which recently are also facing this problem that inherently has been the attribute of only emerging economies. The simplest formula that shows the connection between present and future value of money is the following: PV=FV/(1+I)^n, where PV stands for present value; FV for future value; I for interest rate and n represents the number of periods as the longer in the future you are promised the payment, the less is its current value in today’s dollars. ## How to use TVM theory How can you use TVM theory I real life you might ask? For example, you are contemplating buying a car, something that many people dream about. In this case, there might arise a question of whether to buy the car with cash, finance such a purchase or, maybe, lease it for some period. All those questions might be easily answered if you understand the time value of money theory as it involves comparison of the costs in the present time rather than in the future. Let’s start with the cash purchase first, which is the easiest option – you just pay for your car right away and you incur all your expenses at the present time. The second option, which is financing, might be trickier bearing in mind that you need to consider your initial downpayment and future monthly payments as well. The main difference between financing a car and leasing it is that you end up financing the whole price of the car versus just a depreciation while leasing, meaning the part of the cost that the car will lose after two or three years of your lease contract’s term. --- [Multiple on Invested Capital (MOIC): Definition & guideIn this article, we’re zeroing in on MOIC to uncover what it is, its role in private equity, and more importantly, how you can use it to sharpen your investment evaluation skills.r![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/FA_Framework_Tiles_2_capital_allocation.jpg)](https://www.financealliance.io/multiple-on-invested-capital-moic/) --- The financing option could also be refinanced in the future while lease agreements usually do not have such an opportunity. While comparing those two options, leasing and financing, you need to understand that your monthly payments will happen in the future and as such cost less, according to time value of money theory, in present terms. For a financing option, you also need to factor in potential resale value of your car after some years, depending also on how often you would like to be driving your new car. If your resale value exceeds the amount that you still owe to your financial institution at the time, you need to factor in this positive difference in value that will happen in the future as well and as such should be discounted back to the present using an appropriate value of interest rate I from the formula above. ## In conclusion... As a closing thought, the same time value of money theory is also used in corporate finance as well. Imagine that instead of the car you need to select the best project that will potentially bring your company the biggest monetary benefits. The steps to accomplish this task are very similar to the ones outlined above – calculate present values of your future cash inflows that you anticipate from each of the projects, considering their appropriate interest rates. Then subtract initial investments needed to start each of the projects and you will end up with something called net present value (NPV). You then should select the project with the highest dollar return represented by NPV and if NPV of some project is less than zero, meaning that you need to invest more than potentially receive back from the project, you need to decline such a project right away. My hope is that this article makes finance more interesting for everyone as it shows that concepts of [finance](https://www.financealliance.io/finance-careers-how-many-jobs-are-available-in-finance/) might be used in everyday situations and are indeed fundamental for the life of every person planning to make a large purchase. ***\[Author: Dr. Artem Malinin, Florida Polytechnic University\]*** --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_6.png) ](https://events.financealliance.io/) ### Decentralized finance: Disrupting traditional finance URL: https://www.financealliance.io/decentralized-finance-disrupting-traditional-finance/ Last updated: 2025-04-04T14:58:38.000Z The world of finance is on the cusp of a revolution, driven by the emergence of decentralized finance (DeFi). DeFi is an ecosystem of financial applications and services built on blockchain technology, enabling peer-to-peer transactions *without* the need for traditional intermediaries like banks or other centralized institutions. At its core, DeFi aims to democratize finance by providing an open, transparent, and permissionless system accessible to anyone with an internet connection. Unlike traditional finance, where control is centralized and access is often restricted, DeFi operates on decentralized networks, ensuring that no single entity has control over the system. The DeFi ecosystem is rapidly expanding, offering a wide range of services, including lending and borrowing platforms, decentralized exchanges (DEXs), stablecoins, and more. ## Decentralized lending platforms One of the most significant DeFi applications is decentralized lending platforms, which allow users to lend or borrow cryptocurrencies without the need for a traditional financial institution. These platforms use smart contracts, self-executing contracts built on blockchain technology, to facilitate the lending and borrowing process. Lenders can earn interest by providing liquidity to the platform, while borrowers can access loans without undergoing traditional credit checks or providing collateral. Another critical component of the DeFi ecosystem is decentralized exchanges (DEXs). Unlike centralized exchanges, which act as intermediaries and hold users' funds, DEXs facilitate peer-to-peer trading of cryptocurrencies without a central authority. This decentralized approach eliminates the need for a trusted third party, reducing the risk of hacks, censorship, and other [potential security issues](https://www.financealliance.io/cfo-cybersecurity/) associated with centralized exchanges. Stablecoins, cryptocurrencies designed to maintain a stable value relative to a fiat currency or a basket of assets, play a crucial role in the DeFi ecosystem. They provide a stable medium of exchange, enabling users to participate in DeFi applications without being exposed to the volatility of cryptocurrencies like Bitcoin or Ethereum. --- [How organizations fuel innovation through ESG and diversityIn this article, I’ll be sharing my experience with ESG and sustainability practices.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192.png)Finance AllianceCarolina Veira![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/nicholas-doherty-pONBhDyOFoM-unsplash.jpg)](https://www.financealliance.io/how-great-organizations-fuel-innovation-through-esg-and-diversity/) --- ## DeFi challenges While DeFi offers numerous advantages, such as increased accessibility, transparency, and security, it also faces several challenges. One of the most significant concerns is the lack of regulatory oversight, which could lead to potential risks, including market manipulation, fraud, and money laundering. Additionally, the technical complexities of DeFi applications and the potential for smart contract vulnerabilities raise concerns about the security and reliability of these systems. Despite these challenges, the DeFi ecosystem continues to grow rapidly, attracting significant investment and attention from both traditional financial institutions and cryptocurrency enthusiasts. ## How DeFi can disrupt traditional finance As the technology matures and regulatory frameworks are established, DeFi has the potential to disrupt traditional finance by offering a more inclusive, transparent, and efficient financial system. There are a few key factors that make it challenging for existing traditional banks to fully invest in and control the decentralized finance (DeFi) ecosystem: ### **1\. Decentralized nature** DeFi protocols and platforms are designed to be decentralized, with no single entity controlling or governing the system. This goes against the centralized structure of traditional banks, which are heavily regulated and controlled by central authorities. ### 2\. Lack of regulatory clarity The regulatory landscape for DeFi is still evolving and lacks clear guidelines in many jurisdictions. Traditional banks operate under strict regulations and may be hesitant to invest heavily in an area with uncertain regulatory implications. ### 3\. Different business models DeFi protocols are often built on open-source, permissionless, and trustless principles, which clash with the traditional business models of banks that rely on intermediaries and centralized control. ### 4\. Disruptive potential DeFi aims to disrupt traditional financial services by offering an alternative system that eliminates the need for intermediaries like banks. Existing banks may be hesitant to invest heavily in a [technology](https://www.financealliance.io/how-to-optimize-finance-teams/) that could potentially disrupt their core business. ### 5\. Technological challenges DeFi protocols are built on complex blockchain technology and smart contracts, which may require traditional banks to acquire new technical expertise and infrastructure to participate effectively. ### 6\. Cultural resistance The decentralized, transparent, and open nature of DeFi may clash with the traditional corporate culture and practices of banks, which could lead to resistance in fully embracing the technology. However, it's important to note that some traditional banks and financial institutions are exploring ways to integrate certain aspects of DeFi, such as tokenization, decentralized lending, and blockchain-based payments, into their existing systems. This is often done through partnerships, investments in DeFi startups, or by building their own DeFi-inspired products and services. Ultimately, the core principles of DeFi, such as decentralization, transparency, and disintermediation, make it challenging for traditional banks to completely control and centralize the ecosystem without fundamentally altering its underlying philosophy and structure. --- [CFO vs. Controller: What’s the difference?In this article, we’re going to try to clear up the confusion. We’ll look at how CFOs and Controllers contribute to a company’s financial health, what their day-to-day responsibilities look like, and why both roles are crucial for businesses of all sizes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192.png)Finance AllianceElla Harrison![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/CFO-vs-controller-2.png)](https://www.financealliance.io/cfo-vs-controller/) --- ## How traditional banks are dealing with DeFi Traditional banks are taking a range of approaches to deal with the disruptive potential of decentralized finance (DeFi): ### **1\. Observing and learning** Many banks are closely monitoring the development of DeFi and trying to understand its implications for the traditional financial system. They are studying the technology, use cases, and [potential risks](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) and opportunities. ### **2\. Partnering and investing** Some banks are partnering with DeFi companies or investing in DeFi startups to gain exposure and learn from the inside. This allows them to explore the technology without fully committing their core business. ### **3\. Building in-house DeFi capabilities** A few progressive banks are building their own DeFi-inspired products and services, such as tokenized assets, decentralized lending platforms, or blockchain-based payment systems. This allows them to offer DeFi-like services within a regulated framework. ### 4\. Lobbying and advocating Banks are also working with regulators and policymakers to shape the regulatory landscape surrounding DeFi. They aim to ensure that any new regulations protect their interests and maintain their competitive advantage. ### 5\. Offering custodial services Some banks are exploring offering custodial services for digital assets and cryptocurrencies, which could help bridge the gap between traditional finance and DeFi. ### 6\. Developing enterprise blockchain solutions Banks are investing in enterprise blockchain solutions that could potentially integrate with DeFi protocols, allowing them to leverage the technology without fully embracing the decentralized aspect. ### 7\. Acquiring DeFi startups A few banks have acquired DeFi startups or companies working on blockchain and cryptocurrency solutions, bringing the talent and technology in-house. ### 8\. Maintaining a cautious stance Some banks are taking a more cautious approach, citing regulatory uncertainties, security risks, and the potential for financial instability as reasons for not fully embracing DeFi yet. Overall, while some banks are actively exploring DeFi, others remain skeptical or adopt a wait-and-see approach. The response from traditional banks varies, reflecting the disruptive nature of DeFi and the potential challenges it poses to their existing business models. --- [Profit planning: Why most fail & 7 steps to succeedThe hard truth is that most businesses aren’t profit planning properly or nearly enough. Many are stuck in their old ways using outdated strategies, overlooking critical factors, or worse, flying by the seat of their pants with no real plan at all.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/profit-planning.png)](https://www.financealliance.io/profit-planning/) --- ## Predictions about the future of decentralized finance The potential impact of decentralized finance (DeFi) on traditional banks is significant, and it's challenging to predict the exact magnitude and market size due to the rapidly evolving nature of the technology and industry. However, here's an assessment based on current trends and projections: ### 1\. Potential impact on traditional banks **Disintermediation:** DeFi protocols aim to eliminate the need for intermediaries like banks, posing a direct threat to their role as financial middlemen. **Loss of market share:** As more users adopt DeFi services for lending, borrowing, trading, and other financial activities, traditional banks could lose a substantial portion of their market share. **Reduced profit margins:** The transparent and open nature of DeFi could lead to increased competition and lower fees, squeezing profit margins for traditional banks. **Regulatory challenges:** Banks may face pressure to adapt to new regulations and oversight mechanisms as DeFi grows, potentially increasing their compliance costs. ### 2\. Anticipated market size According to a report by Reditrust, the total value locked (TVL) in DeFi protocols surpassed $200 billion in 2022, indicating significant growth and adoption. Projections by [Crypto.com](http://crypto.com/) suggest that the DeFi market could reach a value of $507 billion by 2028, with a compound annual growth rate (CAGR) of around 43.8% between 2022 and 2028. A report by MarketsandMarkets estimates the global DeFi market size to grow from $13.8 billion in 2022 to $507.9 billion by 2029, representing a CAGR of around 43.2% during the forecast period. It's important to note that these projections are subject to various factors, including regulatory developments, mainstream adoption, technological advancements, and the overall growth of the cryptocurrency and blockchain ecosystem. While DeFi has the potential to significantly disrupt traditional banking services, it's unlikely to completely replace traditional banks in the near future. However, banks that fail to adapt and integrate DeFi components into their offerings may face challenges in retaining market share and remaining competitive in the long run. Ultimately, the impact of DeFi on traditional banks will depend on their ability to innovate, collaborate, and adopt DeFi concepts or develop complementary services that cater to the evolving needs of customers seeking decentralized, transparent, and efficient financial solutions. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_3.png) ](https://www.financealliance.io/insider-membership-plan/) ### FP&A Summit speaker spotlight with Daniele Martins URL: https://www.financealliance.io/fp-a-speaker-spotlight-with-dani-martins-2/ Last updated: 2024-09-13T14:45:22.000Z Artificial intelligence (AI) is streamlining financial processes and helping to improve decision-making across industries worldwide. But keeping up with this level of technology and the speed of its growth can be difficult, which is why we've invited [Daniele Martins](https://www.linkedin.com/company/73979524/admin/page-posts/published/?share=true#), Strategic Business Partner & Founder of DM Brasil Soluções Estratégicas (and Formerly VP, Global Head of FP&A at ThoughtWorks), to speak at the [FP&A Summit in London](https://events.financealliance.io/location/london) (November 6, 2024). Daniele will be speaking about how you can elevate human skills in the age of AI, exploring the critical balance between leveraging technological advancements and nurturing human capabilities in finance and beyond. Daniele draws from years of experience in transforming finance teams globally, revealing exclusive insights to help you unlock new levels of success and create more resilient, future-ready teams. Keep reading to learn more about Daniele, her upcoming speaker session and advice in this speaker spotlight interview.👇 ## **What will you be speaking about at our event?** "*Beyond Automation: Elevating Human Skills in the Age of AI*" explores the critical balance between leveraging technological advancements and nurturing human capabilities in finance and beyond. While automation and AI promise to streamline processes and enhance decision-making, the true competitive advantage lies in cultivating human skills like adaptability, emotional intelligence, and strategic thinking. Drawing from years of experience in transforming finance teams globally, this talk emphasizes the importance of an Agile mindset and a people-centered approach to leadership. By focusing on human development alongside technological adoption, we can unlock new levels of success and create more resilient, future-ready teams. ## **What is the key takeaway you hope attendees will gain from your presentation?** ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/6-2.png) The future will have little room for those who cling to outdated command-and-control leadership styles or rely on micromanagement. Instead, we are challenged by [global economic shifts](https://www.financealliance.io/what-is-economic-analysis-the-question-every-cfo-should-be-asking/) and a new generation of workers demanding purpose, autonomy, and flexibility. To lead effectively in this new era, we must prioritize developing our teams' human skills—such as creativity, adaptability, and emotional intelligence—creating a culture that values continuous learning and innovation. Only then can we fully leverage the potential of AI while ensuring that the human element remains at the core of our success. --- [FP&A Summit speaker spotlight with Liudmila GudinaWe’re super excited to have Liudmila Gudina, Fagron’s Global Working Capital Manager, join us for a chat before her big session at the FP&A Summit in London!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--5--2.png)](https://www.financealliance.io/fp-a-summit-speaker-spotlight-with-liudmila-gudina/) --- ## **Who is your ideal attendee for this event, and why would your presentation be valuable to them?** The ideal attendees for this talk are leaders who already understand that the traditional approach to leadership is no longer viable and are eager to explore new ways to drive performance and engagement within their teams. This includes both experienced leaders who are ready to pivot towards more adaptive and people-focused leadership styles, as well as emerging leaders who are seeking guidance on how to effectively lead in a rapidly changing environment. Additionally, the talk will benefit individuals who are curious about evolving their leadership approach to better empower their teams and navigate the challenges posed by automation, AI, and shifting workplace dynamics. ## **What are you looking forward to the most about the event?** I'm interested in hearing what other leaders are focusing on and are most critical to companies in the UK. And getting to know what challenges they face so I can understand a bit more of the context and perhaps partner with some of them. --- [FP&A Summit speaker spotlight with Kavin SoniWelcome to another interview from our FP&A Summit speaker spotlight series with Kavin Soni!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Sharing_Article_Images_Author-Text--2-.png)](https://www.financealliance.io/fp-a-summit-speaker-spotlight-with-kavin-soni-from-google/) --- ## **Can you provide a brief teaser of what attendees can expect from your presentation?** I am not a traditional finance professional. Although I have over 20 years of experience in the field, 12 of those years were spent at a tech company with a vision to revolutionize the world. This experience challenged me to change how I partner with the business, and throughout my journey, I discovered that my authenticity is what truly drives my success. By blending knowledge from various disciplines, I have developed a unique perspective on what high performance means today. So, expect a fresh take on leadership—one that breaks away from conventional norms and embraces a more holistic, innovative approach. ## **What’s the best career advice you’ve ever received?** The best career advice is to be yourself, keep your head down, and trust that your hard work will eventually be recognized. However, never shy away from avoiding unnecessary conflict, and always be open to change—pivot as many times as needed to find both happiness and success. ## **What advice would you give to young professionals starting out in the finance industry?** Understand that mastery takes time, and there are no shortcuts to becoming truly proficient in your field. Focus on the journey rather than rushing to reach a destination. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/7-3.png) ## About Dani Martins [Dani Martins](https://www.linkedin.com/in/eudanimartins/) is a seasoned strategic executive with over 25 years of diverse and solid career experience. Renowned for her passion for transformation, Dani partners with people and organisations to translate strategies into actionable outcomes. Her expertise spans Financial Planning, Leadership, Business Management, and Change Management. Throughout her career, Dani has spent more than a decade as the International Financial Planning Director at a leading multinational technology company. In this role, she honed her skills in agile processes and team leadership, successfully guiding cross-functional teams across the globe. Beyond her executive leadership, Dani founded the FPA Brasil community and Infinitum Eu. Through these platforms, she is committed to transforming professionals in the financial planning industry and empowering female leadership. Dani holds a strong academic foundation in Accounting, Marketing, Business Management, and Psychology, and she is continually pursuing personal growth and sharing her extensive knowledge with others. --- ## **Join us at the FP&A Summit London!** Unleash the full strategic potential of your financial planning & analysis function at the FP&A Summit in London on November 6! Join FP&A leaders as they share best practices and common challenges to keep you up-to-date with the latest innovations and skills you need to increase forecasting accuracy, integrate AI and automation and drive growth through business partnering. See you at the [FP&A Summit in London](https://events.financealliance.io/location/london?ref=financealliance.io)! [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_6.png) ](https://events.financealliance.io/) ### FP&A: The key to unlocking a company's financial potential URL: https://www.financealliance.io/fp-a-the-key-to-unlocking-a-companys-financial-potential/ Last updated: 2025-10-01T11:02:13.000Z Unlocking a company's financial potential is made possible in large part by the vital role that financial planning and analysis (FP&A) plays inside an organization. FP&A professionals are responsible for analyzing and interpreting [financial data](https://www.financealliance.io/mastering-data-storytelling/), creating [financial models](https://www.financealliance.io/12-financial-modeling-best-practices-to-avoid-frustrations/) and forecasts, and providing insights and recommendations to management. In this article, we'll explore the importance of FP&A and how it can be used to drive business growth and success. ## Budgeting & forecasting One of the main roles of FP&A is to provide management with **financial forecasting and budgeting.** This includes creating financial models that predict future revenue, expenses, and cash flow. These models can be used to identify potential risks and opportunities and make informed decisions about how to allocate resources and invest in the business. Management can decide to devote more resources to a new product line. For instance, if a model indicates that it is likely to be very profitable. --- [FP&A for startups: The role of FP&A in business growthIn this article, we explore how FP&A can help grow startups and provide vital support in making smart financial decisions during the early stages of growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FP-A-startup.jpg)](https://www.financealliance.io/fp-a-for-startups/) --- ## Identifying & tracking KPIs FP&A professionals also **play a key role in identifying and tracking key performance indicators (KPIs)** that are critical to the business. This includes [financial metrics](https://www.financealliance.io/esg-metrics/) such as revenue growth, gross margin, and ROI, as well as non-financial metrics such as customer satisfaction and employee engagement. By monitoring these KPIs, FP&A can provide early warning signs of potential issues and help management take proactive steps to address them. ## Supporting strategic decisions In addition, FP&A also **helps management make strategic decisions.** This includes evaluating potential [mergers and acquisitions](https://www.financealliance.io/m-a-best-practices/), assessing the feasibility of new business ventures, and determining the optimal capital structure for the company. By providing insights and recommendations on these types of decisions, FP&A can help management make informed choices that will drive long-term growth and success. ## Why is FP&A so important? In today's fast-paced business environment, it's more important than ever for companies to have a strong FP&A function. The insights and recommendations provided by FP&A professionals can help management make informed decisions that drive business growth and success. ## In conclusion... FP&A plays a crucial role in unlocking a company's financial potential. It provides financial forecasting, [budgeting](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), and analysis to management, enabling them to make informed decisions that drive business growth and success. By identifying and tracking key performance indicators, making strategic decisions, and ensuring compliance, FP&A professionals can help a company reach its full potential and achieve long-term success. It's a function that should not be overlooked by any business looking to achieve its financial goals. --- ### Read more articles from Asif Masani [7 reasons why FP&A professionals miss the busAsif Masani examines the reasons why FP&A professionals miss the bus when it comes to delivering accurate and meaningful information to the rest of the organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/FA_Website_Article_Images_Stock.png)](https://www.financealliance.io/7-reasons-why-fp-a-professionals-miss-the-bus/) [12 financial modeling best practices to avoid frustrationsWhether you’re just starting in finance and FP&A or if you’re working on your next financial model soon, these 12 tips will be very handy.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Author_Highlight--3--2.png)](https://www.financealliance.io/12-financial-modeling-best-practices-to-avoid-frustrations/) [9 upcoming trends that are transforming FP&AAs the FP&A function continues to evolve, it’s essential for financial professionals to stay up to date on the latest trends. In this article, we’ll explore nine of the top upcoming trends that are transforming the FP&A function.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/pexels-eric-anada-1495580.jpg)](https://www.financealliance.io/9-upcoming-trends-that-ransforming-fp-a/) [7 tips for finance to get closer to businessAre you looking for ways to bridge the gap with your business teams? In this article, we will discuss seven proven tips to help finance get closer to business.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/cytonn-photography-n95VMLxqM2I-unsplash--1-.jpg)](https://www.financealliance.io/7-tips-for-finance-to-get-closer-to-business/) ### FP&A Summit speaker spotlight with Kavin Soni from Google URL: https://www.financealliance.io/fp-a-summit-speaker-spotlight-with-kavin-soni-from-google/ Last updated: 2024-10-02T10:58:20.000Z Want to accelerate your FP&A career? Look no further than [Kavin Soni](https://www.linkedin.com/in/kavinsoni/ ), a financial analyst at Google Ads who has been making waves in the industry. With his deep understanding of financial modeling and advanced quantitative analytics, Kavin has played a pivotal role in driving the success of Google Ads' small business segment. If you're looking to learn from the best, don't miss the opportunity to hear Kavin speak at the [**FP&A Summit in Boston**](https://events.financealliance.io/location/boston/fpasummit) on October 8, where he joins a panel to discuss how you can accelerate your FP&A career. We caught up with Kavin ahead of the event to hear about him, his expertise, and what our attendees can expect from his panel session. ### 1\. Hi Kavin, please introduce yourself! I am Kavin, a finance professional who has been working in the Digital Advertisement space as a Financial Analyst. I have navigated the complexities of this industry through advanced [statistical models](https://www.financealliance.io/10-best-financial-modeling-tools/), contributing my insights as a speaker, author, and judge at various events. I have called Google my professional home since 2019, where I have honed my skills. Beyond crunching numbers, I am also a bit of a coffee enthusiast. I have even dabbled in latte art classes and am always on the hunt for the perfect cup from various roasteries. ☕️ ### 2\. What will you be speaking about at our event? I will be diving into a critical skill for finance professionals: effective [business partnering](https://www.financealliance.io/finance-business-partnering-playbook-2/). We'll explore how to tailor your financial analysis to resonate with different audiences, whether it's senior leadership, cross-functional teams, or external stakeholders. By the end of this session, you'll be empowered to leverage your analysis as a catalyst for change, leading cross-functional teams towards impactful business outcomes. My goal is to help you elevate your business partnering skills through clear, compelling narratives. --- [FP&A Summit speaker spotlight with Mathew ReyndersAs we gear up for the FP&A Summit in Boston, we spoke with Mathew Reynders, Vice President of FP&A at Outbrain, who believes that mastering the art of storytelling is the key differentiator for financial leaders today.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/FA_Sharing_Article_Images_Author-Text--6--2.png)](https://www.financealliance.io/fp-a-summit-speaker-spotlight-data-storytelling-for-fp-a/) --- ### 3\. What is the key takeaway you hope attendees will gain from your presentation? > **Key takeaway: Influence stakeholders, drive impact** The main takeaway I hope attendees will gain is the ability to craft persuasive narratives that drive decision-making and foster collaboration. You will know more about how to translate complex quantitative insights into actionable stories that resonate with your specific audience. ### 4\. Who is your ideal attendee for this event, and why would your presentation be valuable to them? This presentation is tailored for finance professionals who regularly partner with stakeholders and present their findings to leadership across different teams. Entry- to mid-level [FP&A professionals](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) will gain valuable insights into the art of storytelling, while senior executives can use this as a guide to empower their teams. ### 5\. What are you looking forward to the most about the event? Share knowledge and expertise with professionals in the industry and network with people from different walks of life and learn from their experience. ![FP&A Summit speaker spotlight series - Kavin Soni](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/Wayne-Brewer-SaaS-Member-quote.png) ### 6\. Can you provide a brief teaser of what attendees can expect from your presentation? Here's a sneak peek at what you can expect from my presentation: - **Understanding your audience:** Identify their needs, motivations, and preferred communication styles. - **Crafting your narrative:** Develop a clear, concise, and impactful message. - **Business partnering:** Build trust, credibility, and influence across teams. ### 7\. What’s the best career advice you’ve ever received? ![FP&A Summit speaker spotlight series - Kavin Soni](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/09/Wayne-Brewer-SaaS-Member-quote--2-.png) ### 8\. What advice would you give to young professionals starting out in the finance industry? Don't be afraid to express your ideas and take on challenges outside your comfort zone. Embrace opportunities for growth, ask questions, and actively seek out mentors who can guide you on your journey. ### 9\. How can attendees connect with you after the event to learn more? I'm excited to continue the conversation after the event! Feel free to connect with me on [LinkedIn](https://www.linkedin.com/in/kavinsoni/ ). Let's transform your financial communication and make a lasting impact together! --- ## Join us at the FP&A Summit in Boston! Unleash the full strategic potential of your financial planning & analysis function at the FP&A Summit in Boston on October 8! Join FP&A leaders as they share best practices and common challenges to keep you up-to-date with the latest innovations and skills you need to increase forecasting accuracy, integrate AI and automation and drive growth through business partnering. See you at the [**FP&A Summit in Boston**](https://events.financealliance.io/location/boston/fpasummit)! [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_6.png) ](https://events.financealliance.io/) ### Why most businesses fail at profit planning (and 7 steps to succeed) URL: https://www.financealliance.io/profit-planning/ Last updated: 2025-11-05T15:00:34.000Z The hard truth is that *most* businesses aren’t profit planning properly or nearly enough. Many are stuck in their old ways using outdated strategies, overlooking critical factors, or worse, flying by the seat of their pants with no real plan at all. But here’s the good news: effective profit planning isn't rocket science. It's a skill that can be learned, honed, and mastered. So, here’s why most businesses fail at profit planning and seven secrets of the trade to help you transform your approach and supercharge your bottom line.👇 --- ### Topics covered: - [The definition of profit planning](https://www.financealliance.io/p/f5a6cb2f-bec8-4d2b-98ed-a583c83273e4/#what-is-profit-planning) - [What's the difference between cash planning and profit planning](https://www.financealliance.io/p/f5a6cb2f-bec8-4d2b-98ed-a583c83273e4/#cash-planning-vs-profit-planning) - [Budget planning vs profit planning](https://www.financealliance.io/p/f5a6cb2f-bec8-4d2b-98ed-a583c83273e4/#budget-planning-vs-profit-planning) - [Why planning for profits is so important](https://www.financealliance.io/p/f5a6cb2f-bec8-4d2b-98ed-a583c83273e4/#why-is-profit-planning-so-important) - [Common pitfalls](https://www.financealliance.io/p/f5a6cb2f-bec8-4d2b-98ed-a583c83273e4/#where-do-companies-go-wrong) - [How to create a profit plan (in seven steps)](https://www.financealliance.io/p/f5a6cb2f-bec8-4d2b-98ed-a583c83273e4/#7-steps-to-create-a-profit-plan-secrets-for-success) --- ## **What is profit planning?** Profit planning is exactly what it sounds like: planning for profit. It’s a process where companies outline their expected revenues, expenses, and profits for a specific period, usually over a year. To build a solid profit plan, you'll need to set targets for sales, costs, and expenses. It's also smart to [consider different scenarios](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/), like what might happen if things go *really* well or *really* bad. Your main goal is to create a strategy that helps you (or your company) reach its desired profit levels. This means aligning your sales goals, pricing, cost-cutting efforts, and [investment](https://www.financealliance.io/multiple-on-invested-capital-moic/) decisions. ### Cash planning vs profit planning Cash planning is about *managing* liquidity, while profit planning is about *achieving* profitability. [Cash planning](https://www.financealliance.io/cash-flow-drivers-in-a-business/) ensures there is enough cash on hand for a company to meet short-term obligations and it deals with the timing of cash inflows and outflows to maintain adequate liquidity. Profit planning, on the other hand, is centered around [forecasting](https://www.financealliance.io/rolling-forecast-best-practices/) and strategizing to achieve a certain level of profit. It focuses more on setting targets for revenue and managing costs to make sure the business is profitable over time. ### Budget planning vs profit planning The main difference between budget planning and profit planning is that budget planning focuses on [managing expenses and allocating resources ](https://www.financealliance.io/tips-to-allocate-budget-across-departments/)to ensure financial stability, while profit planning concentrates on setting and achieving targets for revenue growth and profitability to drive the company’s financial success. --- [Why CFOs need to be great people managers (10 tips)Being a Chief Financial Officer (CFO) and leading a phenomenal finance team isn’t just about financial management and strategy - it’s about people and being an effective people manager.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/FA_Framework_Tiles_3_people_manager.jpg)](https://www.financealliance.io/why-cfos-need-to-be-people-managers/) --- ## **Why is profit planning so important?** Now, you might wonder why all this planning is necessary. Can’t we just set a sales target and hope for the best? Well, not quite. Profit planning is important because it gives you a clear direction. It keeps you on track, helps you set achievable goals, and shows you where potential roadblocks might lie. Let's consider a fictional example to help illustrate this better… Imagine you’re running a mid-sized tech company. Without a profit plan, you might be throwing money at different projects, hoping something sticks. But with a profit plan, you can make smarter choices about where to invest your resources. For example, you might focus on your most successful product or cut costs in areas that aren't making much money. A profit plan helps you make decisions based on facts, not just gut feelings. ## **Where do companies go wrong?** It’s not always easy to carry out profit planning in such a way that guarantees excellent results. Businesses often dive into some of these common pitfalls: ### **Short-term focus** **Don’t sacrifice long-term growth for quick wins.* Many businesses fall into the trap of prioritizing immediate gains over [long-term sustainability](https://www.financealliance.io/esg-metrics/). They chase quick profits at the expense of building a solid foundation for future growth. ### **Overly optimistic projections** **Be realistic about your sales and revenue goals.* There’s nothing wrong with being optimistic. However, a positive outlook can lead to issues when you start setting overly optimistic sales and revenue projections. When projections are too high, companies may overestimate their revenues and underestimate the resources needed to achieve those targets. Companies might overspend on resources they don't need, struggle with cash flow, and ultimately fall short of their profit goals. ### **Failing to consider all costs** **Unexpected expenses can derail your profits.* Another big mistake in profit planning is failing to account for all potential costs. Many businesses focus primarily on fixed costs (like rent and salaries) and variable costs (like materials and production expenses) but overlook other expenses. And, as you can probably guess, unexpected costs can quickly eat into profits. --- [Enterprise resource planning for the manufacturing industryAre your manufacturing operations looking a little…rusty? The reason for that could be a lack of a suitable enterprise resource planning (ERP) system…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/Enterprise-resource-planning-for-manufacturing-industry.png)](https://www.financealliance.io/enterprise-resource-planning-for-manufacturing/) --- ### **Neglecting cash flow** **Profit doesn't always mean cash in hand.* Businesses often forget to factor in the timing of payments and expenses, leading to cash flow crunches *even* when the books show a profit. For example, if your company sells a product on credit with a 30-day payment term, you'll recognize the [revenue](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/) when the sale is made. However, the cash won't come in until the customer pays. If you have significant expenses due before the payment is received, you might face a cash flow crunch, even if your business is profitable overall. ### **Ignoring market dynamics** **Stay updated on industry trends and changes.* Relying solely on past performance can be a risky strategy. Businesses need to be adaptable to changes in the market, such as shifts in consumer tastes, new technologies, and increased competition. Failing to adjust your profit plan to these changes can put your business at a disadvantage. ### **Lack of clear objectives** **A well-defined goal is essential for success.* Many businesses jump into profit planning without first setting clear, specific objectives or ensuring that their plan aligns with the overall business strategy. This is a problem, because without a clear goal, your profit plan will lack direction. Profit goals should be defined early on so that you can measure progress and adjust the course of the plan if needed. ### **Underestimating the importance of data** **Data is your guide to making informed decisions.* Data is the backbone of effective profit planning. However, many businesses either lack access to quality data or fail to use it properly, leading to inaccurate forecasts and poor decision-making. ### **Poor communication and lack of buy-in** **Involve your team and ensure everyone is on board.* Profit planning often fails because it is done in isolation by the finance team, with little input from other departments. This lack of communication can result in a plan that doesn’t have [buy-in from key stakeholders](https://www.financealliance.io/stakeholder-communication-plan/). If this happens, you’re more likely to see misunderstandings emerge along with misaligned goals and even resistance to change. --- [CFO interview questions and answersIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/08/CFO-interview-questions-2.jpg)](https://www.financealliance.io/cfo-interview-questions-and-answers/) --- ## **7 steps to create a profit plan: Secrets for success** Creating a successful profit plan involves more than just setting sales targets and hoping for the best. If you want to create the best possible profit plan for your business, you’ll need to take a structured approach. So, here are seven steps and secrets for profit planning success to help you maximize your business’s profitability. ### **Step 1: Set clear objectives and SMART goals** Begin by defining what you want to accomplish. Your objectives should be clear and align with your overall business strategy. To make your goals actionable, try following the SMART framework: - **Specific**: Clearly define what you want to achieve (e.g., "Increase net profit by 15%"). - **Measurable**: Set quantifiable targets that can be tracked (e.g., "Increase sales revenue by 20%"). - **Achievable**: Ensure your goals are realistic and attainable given your resources and circumstances. - **Relevant**: Make sure your goals align with your business's overall direction and priorities. - **Time-bound**: Set deadlines to create a sense of urgency and accountability. **Example**: Instead of a vague goal like "Increase profits," set a specific, measurable, and time-bound goal like "Increase net profit margin by 5% by the end of the year." If you’re not sure about what your profit goals should be, it’s generally recommended to underestimate rather than overestimate your profit goals. ### **Step 2: Analyze your current financial situation** Take a deep dive into your current financial statements to understand where you stand. Analyze your revenue streams, cost structures, and profit margins. Doing this will help you identify strengths, weaknesses, and opportunities – serving as a baseline for your profit planning. Make sure to leverage historical data, market trends, and [financial metrics](https://www.financealliance.io/time-to-value-metric/) to inform your planning. Understanding past performance will help you make accurate forecasts and set realistic goals. ### **Step 3: Forecast sales and revenues** Based on your analysis, project your future income by forecasting sales and revenue for the planning period. Consider factors like market demand, economic conditions, and competition. To help prepare for the unexpected, develop multiple scenarios (best case, worst case, and most likely) to prepare for different market conditions. This approach ensures you’re not caught off guard by unexpected changes and can adapt quickly if needed. ****Tip:** Create contingency plans for each scenario to ensure you're prepared for whatever comes your way. ### **Step 4: Identify costs and plan for expenses** Identify all potential costs and expenses, including fixed costs (such as rent and salaries) and variable costs (like materials and production). It’s also worth considering indirect costs like marketing, maintenance, and unforeseen expenses. Remember, higher revenue doesn't always mean higher profits. So, pay close attention to cost management and aim to optimize your profit margins. Identify your most profitable products or services and focus on maximizing their returns. ****Tip:** Conduct a cost-benefit analysis for each expense. Prioritize spending on areas that directly contribute to profit generation and consider reducing or eliminating costs that do not add significant value. ### **Step 5: Align profit plan with operational plans** Ensure your profit plan aligns with your operational plans. This means coordinating with departments like marketing, sales, production, and HR to ensure everyone is working towards the same profitability goals. A key step here is to involve key stakeholders from different departments in the profit planning process. This creates a shared sense of ownership and helps to build a collaborative approach to achieving profit goals. ****Tip:** Struggling with collaboration between departments? Think about hosting cross-departmental meetings to discuss the profit plan. Make sure everyone understands their role and how their actions impact the company’s profitability. ### **Step 6: Monitor performance and adjust regularly** Profit planning is not a one-time exercise. It requires ongoing monitoring and adjustments to stay aligned with market conditions and business performance. If you want to keep track, it’s a good idea to set up a regular review process (monthly or quarterly) to compare actual performance against the profit plan. From there, you can adjust your strategies based on these insights to stay on track. ### **Step 7: Invest in continuous improvement and innovation** Identify opportunities for innovation and continuous improvement. This might involve developing new products, optimizing processes, or adopting new technologies that can boost profitability. Create a dedicated innovation team to identify and develop new ideas. This team can brainstorm, prototype, and implement new initiatives. They can also coordinate with other departments to ensure that new ideas align with your overall business strategy. By continuously improving and embracing innovation, you'll stay competitive and achieve your profit goals. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_3.png) ](https://www.financealliance.io/insider-membership-plan/) ### A fractional CFOs guide to driving company growth URL: https://www.financealliance.io/guide-to-company-growth/ Last updated: 2026-01-07T08:55:56.000Z For Chief Financial Officers (CFOs) transitioning from full-time roles to fractional positions, the shift often comes with a recalibration of focus and responsibilities. As a fractional CFO, the key to success lies in maintaining a strategic perspective, prioritizing broad-scale transformation and innovation over getting entrenched in the day-to-day operational tasks of the business. This blog explores why staying strategic is crucial for fractional CFOs and how it can significantly influence the future trajectory of the companies they serve. **Topics covered:** - [Understanding the role of a fractional CFO](https://www.financealliance.io/p/b60cd886-0a90-4fd3-9abd-61eeaa2765ca/#understanding-the-role-of-a-fractional-cfo) - [Tips to avoid the operational trap](https://www.financealliance.io/p/b60cd886-0a90-4fd3-9abd-61eeaa2765ca/#avoiding-the-operational-trap) - [How to actively shape the future ](https://www.financealliance.io/p/b60cd886-0a90-4fd3-9abd-61eeaa2765ca/#actively-shaping-the-future) ## **Understanding the role of a fractional CFO** [Fractional CFOs](https://www.financealliance.io/how-to-become-a-fractional-cfo/) provide the high-level financial insight that companies need *without* the full-time presence or cost associated with a permanent CFO. This role is particularly valuable for small to medium-sized enterprises or startups that require expert guidance to navigate critical growth phases but don't have the resources to employ a full-time CFO. The primary responsibility of a fractional CFO is to steer the strategic financial direction of the company. This involves high-level decision-making, planning, and forecasting that align with the company's long-term goals. While the temptation to dive into [operational details](https://www.financealliance.io/operational-finance/) can be strong, especially for those accustomed to hands-on roles, fractional CFOs must resist this inclination to remain effective. ### **1\. Staying strategic: The big picture** Staying strategic means consistently focusing on the big picture and how various elements of the business interconnect from a financial perspective. This approach allows fractional CFOs to drive substantial improvements and ensure that the financial strategy supports broader business objectives. ### **2\. Strategic planning and visioning** [Strategic planning](https://www.financealliance.io/how-to-improve-your-strategic-impact-in-finance/) is foundational. It involves setting financial goals that align with the company’s mission and long-term vision. As a fractional CFO, facilitating strategic sessions that involve forecasting, [risk assessment](https://www.financealliance.io/risks-of-mergers-and-acquisitions/), and scenario planning is crucial. These sessions help identify growth opportunities and potential challenges, forming the basis for informed decision-making. ### **3\. Financial leadership and advisory** Another significant aspect of staying strategic is providing leadership and advisory services that go beyond mere financial management. This involves advising on policy, [capital structure](https://www.financealliance.io/multiple-on-invested-capital-moic/), investments, and even corporate governance. By guiding these areas, a fractional CFO can influence the overall direction of the company, ensuring it remains on a path to [sustainable growth](https://www.financealliance.io/esg-metrics/). ### **4\. Focusing on transformation and innovation** In today's rapidly changing business environment, driving transformation and fostering innovation are key. A strategic CFO should focus on how financial tools and models can be used to support new projects, enter new markets, or optimize current operations. This may involve leveraging new technologies, exploring new business models, or initiating strategic partnerships that enhance competitive advantage. --- [Top 20 Q’s from Fractional CFOsHere are the top 20 questions you might have when planning the transition to fractional CFO…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePeter Turner![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/Copy-of-FA_Website_Article_Images_Author_Highlight-2.png)](https://www.financealliance.io/top-20-qs-from-fractional-cfos/) --- ## **Avoiding the operational trap** Getting drawn into the day-to-day management of financial tasks is a common pitfall for many fractional CFOs, particularly those who are used to being deeply involved in all aspects of finance management in full-time roles. Here are our best tips to help you avoid falling into this 'operational trap': ### **Delegation and empowerment** Effective delegation is vital. A fractional CFO must trust and empower the [finance team](https://www.financealliance.io/fp-a-team-structure/) to handle the operational financial tasks. This frees up time to focus on strategic initiatives and high-level decision-making. Building a strong, capable team and setting clear processes and benchmarks is fundamental to this effort. ### **Use of technology** Embracing advanced financial technologies can automate routine tasks and generate real-time data for quicker, more accurate decision-making. Implementing systems like ERP software, cloud accounting, and business intelligence tools can help keep the focus strategic rather than operational. ### **Regular reviews and adjustments** While it's important not to get bogged down in daily operations, maintaining a periodic check-in process ensures that the financial strategy remains aligned with the company's activities and goals. This involves regular financial reviews, updates on ongoing projects, and adjustments based on performance and market changes. --- [Transitioning to fractional CFO: How to lead in 2-4 days!If you’re contemplating this shift, understanding how to effectively lead in just 2-4 days a week is crucial. The unique role of a fractional leader can significantly impact the people in your team, other business functions, external partners and especially business performance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePeter Turner![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/leader-4775796_1280.jpg)](https://www.financealliance.io/transitioning-to-fractional-financial-leadership-how-to-lead-in-2-4-days/) --- ## **Actively shaping the future** A strategic fractional CFO not only navigates the company through current financial landscapes but also actively shapes its future. This involves: ### **Leading with insight** Using financial insights to guide company strategy, especially during uncertain times, can define the trajectory of the company. This means interpreting market trends, [economic signals](https://www.financealliance.io/what-is-economic-analysis-the-question-every-cfo-should-be-asking/), and financial data to forecast potential impacts and prepare proactive strategies. ### **Championing sustainable growth** Sustainability is key in today’s business world. A strategic fractional CFO should advocate for and implement practices that promote financial, social, and environmental sustainability, ensuring the company’s growth does not come at a cost to future generations. ### **Communicating strategically** Effective communication with stakeholders, investors, and internal teams is crucial. Keeping these key parties informed about the financial status and strategy of the company helps build trust and ensures alignment across the organization. For CFOs transitioning to a fractional way of working, focusing on strategic over operational roles can significantly enhance their effectiveness and impact. By steering clear of the minutiae and concentrating on broad-scale transformation, fractional CFOs not only add value to the businesses they serve but also actively shape their future success. This strategic focus is what differentiates a good CFO from a great one, making them not just financial managers but true leaders in the business landscape. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2024/09/FA_Article_Banners_Assets_2.png) ](https://www.financealliance.io/finance-newsletter/) ### FP&A Summit speaker spotlight with Liudmila Gudina URL: https://www.financealliance.io/fp-a-summit-speaker-spotlight-with-liudmila-gudina/ Last updated: 2024-08-30T09:42:56.000Z We're super excited to have [Liudmila Gudina](https://www.linkedin.com/in/liudmila-gudina/), Fagron's Global Working Capital Manager, join us for a chat before her big session at the [FP&A Summit in London](https://events.financealliance.io/location/london/)! Liudmila's a financial strategy guru who's gonna drop some serious knowledge during her talk - "*Driving Financial Agility: Effective Working Capital Strategies for FP&A*." In Liudmila's session at the FP&A Summit, you'll learn how to: - Smooth out your cash flow - Manage your inventory like a pro - Optimize your receivables and payables In this exclusive interview, Liudmila shares more insights about her upcoming session and how to cultivate a "cash-focused culture that aligns financial strategies with operational goals". ### Hi Liudmila, can you tell us about yourself? Hi, I’m Liudmila, and I’m thrilled to be here as a Global Working Capital Manager at Fagron. With over fifteen years of experience optimizing [financial reporting](https://www.financealliance.io/flexible-budget-performance-report/) and working capital for leading multinational companies, I’m passionate about the intricate balance between finance and operations. Throughout my career, I’ve had the privilege of working across various regions, including EMEA, North America, and LATAM, which has enriched my perspective and ability to navigate complex financial landscapes. Beyond work, I’m deeply interested in cultural exchange, which has shaped my ability to navigate and lead in diverse, international environments. I speak five languages and love spending time with my family and kids. I study piloting the small planes in my free time. ✈️ ### **What will you be speaking about at our event?** At the FP&A Summit in London, I’ll be sharing insights on how to cultivate a cash-focused culture that aligns financial strategies with operational goals to drive working capital efficiency. I’ll discuss the importance of communication, aligned incentives, and tailored approaches in managing working capital across different regions and business units that support executive decision-making at Global level. ### **What is the main message or key takeaway you hope attendees will gain from your presentation?** ![FP&A Summit speaker spotlight with Liudmila Gudina](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/08/Wayne-Brewer-SaaS-Member-quote--1--2.png) The key takeaway from my presentation will be the importance of integrating financial strategies with business objectives to achieve sustainable growth and operational excellence. Attendees will learn how aligning communication, incentives, and localized tailor-made strategies can significantly boost working capital efficiency, even in complex, multinational environments. I hope attendees leave with a clear understanding of how to keep focus of everyone to optimizing working capital and improving [cash flow management](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) on the daily basis. ### **Who is your ideal attendee for this event?** My ideal attendee is a finance or operations leader who is looking to optimize their company’s working capital and drive financial sustainability. This presentation will be valuable to them because it offers practical, proven strategies for integrating financial management with operational processes, ultimately leading to improved cash flow and reduced dependency on external financing. ### **What are you looking forward to the most about the event?** I’m most looking forward to engaging with fellow professionals who are passionate about financial management and working capital optimization. I’m eager to share experiences, learn from others, and explore innovative approaches to managing working capital in today’s challenging economic environment. It’s always exciting to engage in discussions that challenge conventional thinking and explore innovative approaches to cash conversion management. ### **Can you provide a brief teaser of what attendees can expect from your presentation?** Attendees can expect a deep dive into actionable strategies for optimizing working capital and improving cash flow management, all framed within the context of achieving broader business goals. I’ll share real-world examples from my experience working with multinational companies, illustrating how these strategies can be implemented effectively. I’ll share specific examples of how we’ve reworked credit policies, aligned operational targets with financial outcomes, and implemented a “helicopter” approach to adapt best practices across different regions and business units. ### **What’s the best career advice you’ve ever received?** ![FP&A Summit speaker spotlight with Liudmila Gudina](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/08/Wayne-Brewer-SaaS-Member-quote-2.png) The best career advice I’ve ever received is to ensure that your work always drives toward the company’s larger goals. Understanding the big picture and how your role fits into it allows you to make a more significant impact and align your efforts with the overall success of the organization. ### **What advice would you give to young professionals starting out in the finance industry?** For young professionals in the finance industry, my advice is to build a solid foundation in both the alignment and strategic aspects of finance. Focus on understanding the connection between [financial metrics](https://www.financealliance.io/tag/finance-metrics/) and operational performance, and cultivate strong communication skills to effectively collaborate across functions. ### **How can attendees connect with you after the event to learn more?** Attendees can connect with me on [LinkedIn](https://www.linkedin.com/in/liudmila-gudina/) or reach out via email. I’m always open to continuing the conversation and exploring opportunities to collaborate on driving financial and operational success. --- ## **Join us at the FP&A Summit London!** Unleash the full strategic potential of your financial planning & analysis function at the FP&A Summit in London on November 6! Join FP&A leaders as they share best practices and common challenges to keep you up-to-date with the latest innovations and skills you need to increase forecasting accuracy, integrate AI and automation and drive growth through business partnering. See you at the [FP&A Summit in London](https://events.financealliance.io/location/london)! [Learn more about the event](https://events.financealliance.io/location/london/) ### How great organizations fuel innovation through ESG and diversity URL: https://www.financealliance.io/how-great-organizations-fuel-innovation-through-esg-and-diversity/ Last updated: 2025-10-23T09:05:37.000Z *Carolina Veira, former Director at Caremax, gave this presentation at the FP&A Summit in November 2022.* I currently lead corporate partnerships, community partnerships, [ESG](https://www.financealliance.io/7-benefits-of-esg-investing/), and [diversity](https://www.financealliance.io/why-we-need-to-amplify-diverse-voices-in-marketing/), equity, and inclusion at Caremax. We have a healthcare platform and manage patients' data technologically, but we also have medical centers as well. In this article, I’ll be sharing my experience with [ESG](https://www.financealliance.io/esg-metrics/) and sustainability practices. - [What is sustainability?](https://www.financealliance.io/p/97903b4d-a90e-41bf-8bed-423d784c9198/#what-is-sustainability) - [Why is sustainability so important? ](https://www.financealliance.io/p/97903b4d-a90e-41bf-8bed-423d784c9198/#why-is-sustainability-so-important) - [Just how wasteful are we?](https://www.financealliance.io/p/97903b4d-a90e-41bf-8bed-423d784c9198/#just-how-wasteful-are-we) - [The triple bottom line (TBL) framework](https://www.financealliance.io/p/97903b4d-a90e-41bf-8bed-423d784c9198/#the-triple-bottom-line-tbl-framework) - [Connecting sustainable development goals (SDGs) to ESG](https://www.financealliance.io/p/97903b4d-a90e-41bf-8bed-423d784c9198/#connecting-sustainable-development-goals-sdgs-to-esg) - [How the financial statements of a company inform the impact change](https://www.financealliance.io/p/97903b4d-a90e-41bf-8bed-423d784c9198/#how-the-financial-statements-of-a-company-inform-the-impact-change) - [Implementing global sustainability projects](https://www.financealliance.io/p/97903b4d-a90e-41bf-8bed-423d784c9198/#implementing-global-sustainability-projects) - [The key advantages of embracing sustainability](https://www.financealliance.io/p/97903b4d-a90e-41bf-8bed-423d784c9198/#the-key-advantages-of-embracing-sustainability) - [Examples of sustainable companies](https://www.financealliance.io/p/97903b4d-a90e-41bf-8bed-423d784c9198/#examples-of-sustainable-companies) # What is sustainability? There's a lot of talk about sustainability and how it impacts our businesses. But what exactly is it? According to the United Nations: *“Sustainability meets the needs of the present without compromising the ability of future generations to meet their own needs.”* For everything that we do, from operations to the supply chain, to finance, to marketing, how can we make sure that our decisions today don’t have a huge or moderate impact on the decisions that future generations are going to be making, and on the world that they're going to be living in? That's why it's about avoiding the depletion of our natural resources to maintain a balanced ecosystem and preserve natural capital because as we know, our natural resources and capital are limited. So that's why we talk about [ESG](https://www.financealliance.io/from-digital-strategy-to-esg/). ESG is a component of three main items: **environment**, **society**, and **economy**. - **Environment** is the air we breathe, the soil we use, and the energy we consume. - **Society** is the interactions between individuals and groups. The things that we do are meant to be for the people that we serve. - On the **economic** or financial side of things, we’re here to add value but also to make a profit. # Why is sustainability so important? We need natural resources and we need our planet to stay healthy. We only have one planet, and that's why there’s a strong focus on making sure that all those natural resources stay there for longer than 100 or 200 years. We want to continue breathing quality air and ensure that the food that’s produced is healthy. We want to connect the quality of the environment to our economic growth, and also to healthcare. Remember, we need everyone to stay healthy to continue producing, evolving, and advancing. Our communities, customers, and producers need healthy environments. So that's why there's such a strong focus on environment and economic growth; we know we depend on the quality of that environment to contribute to the efficient utilization of resources. ## The 4 key global sustainability concerns Global sustainability concerns that we currently face are: - Climate change - Water shortage - Air pollution - Plastic pollution ## Climate change For climate change, there's a strong focus on the economic losses from disasters. In Florida, we have a hurricane season, and that has an impact not only on the way that we operate but also because we have to prepare every year for what's coming. That impacts the reduction of operational hours and the service that we're going to provide, the days that we're going to stay open, and how we’re going to keep our employees, staff, and patients safe. All of that relates to climate change. One might think, *Oh, it's a hurricane? How is that going to impact my daily life?* Well, it does. Because now as an organization, we aren’t only concerned about what's happening with our staff and our customers, but we also have to worry about what's happening with our communities. If the power plants or the city can’t provide energy, that also has an impact on us and our patients. So what do we need to do? Do we hire or rent smaller plants to provide energy? Do we need to let team members connect from a different location? What if something happens to them? In our case, we’ve previously needed to provide additional resources to team members who lost their homes. So that’s why climate change shouldn't only be a concern of the government, it should be a concern for corporations because it impacts our daily operations. ## Water shortage Water shortage is happening a lot as well, and it’s also tied to climate change. Most areas won’t meet demand by 2050, which means that those areas will have no water. That's one of the main elements we need to survive, so that represents a big problem. And what are we going to do about all the flooding? Insurance is impacted by it so the insurance companies charge more to operate. So we have to think about those concerns, but also what's happening with the buildings or locations where we operate. All of that has an impact on our revenue and the way we do business, as well as our vendors’ operations. It's all interconnected. ## Air pollution Air pollution affects the quality of air, and that has an impact on our health, the health of our patients, and also the health of our customers. What are we doing in our operations that are impacting climate change? That also has a lot to do with the governments and the laws they're going to implement, and how our operations are going to be impacted, not only at local and national levels but also globally. Whatever decisions are made in the EU, they trickle down to America, because eventually what's adopted in the EU comes and happens here. It's a slow process, but it affects the way that we operate here. ## Plastic pollution Air pollution is one of the biggest ticket items as well as plastic pollution. By 2050, we expect that there’ll be more plastics than fish in our oceans. So the global impact and the impacts of climate change are some of our biggest concerns as we continue to evolve and grow. I'm very passionate about the environment for many reasons, but I do want to leave a good, healthy planet for future generations. Those future generations could be your children or your nephews or nieces, so we all need to live healthy lives to continue our legacy. --- [11 networking in finance tips: Building your circleNetworking in finance isn’t just about exchanging business cards and talking about the latest stock market trends. It’s about forging genuine connections and positioning yourself in a web of professionals who share insights, opportunities, and wisdom.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/networking-finance-1.png)](https://www.financealliance.io/11-networking-in-finance-tips/) --- # Just how wasteful are we? - The amount of food that’s wasted in the value chain is **31%**. - **60-70%** is the percentage of the original value of PET, cardboard paper that’s lost after the first use of recycled products. - **92%** of the time we don't use our cars. We're a pretty wasteful society in general. We've been trained that way. But for me, it's important to highlight these numbers so we start thinking about ways we can contribute to becoming less wasteful. We can’t solve all the problems in the world, but we can take little steps toward becoming more environmentally friendly. We could commute with somebody or use public transportation. We could also transition from cars that use gas to electric cars or hybrids. That step is much better than just consuming gas, and especially with the economic and political situation globally, it's a better option for us. # The triple bottom line (TBL) framework The TBL framework includes **people**, **planet**, and **profit**, and it goes beyond the traditional measurement of just profit and return on investment. It makes us think about how our decisions and our operational performance are impacting positively or negatively on people, our planet, while in the meantime, making a profit. You can measure people through: - Quality of life - Unemployment rate - Gender equality - Income Examples of environmental measures include: - Air and water quality - Energy consumption - Land use Profit is calculated through economic and financial measures such as: - [Cash flow](https://www.financealliance.io/3-cash-flow-forecasting-challenges/) - Return on investment - All the KPIs that you use in your daily operations So how do we connect those three Ps to ESG? - For environmental we talk about climate change, resource depletion, waste, and pollution. - For social we talk about human rights, modern slavery, child labor, working conditions, and employee relations. - For governance, it’s about executive pay, ethics, board membership, and diversity and inclusion. # Connecting sustainable development goals (SDGs) to ESG The SDGs are a framework that all the big corporations are currently using. The United Nations created the framework with the idea of having a healthy planet and upward mobility for the people who live on it. There are 17 goals. I'm not going to go through them all, but I wanted to make the connection between [ESG](https://www.financealliance.io/are-you-prepared-for-esg-and-sustainable-finance/) and the SDGs, and how they all interconnect. ![The 17 sustainable development goals (SDGs)](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/11/ESG-1.png) We all need economic growth to continue living the lifestyle that we're used to, but we also need to get better in that lifestyle, to live with purpose, and to live in an environmentally friendly way that's going to alleviate the suffering, pain and struggles that future generations will have to go through. All of this needs to be interconnected, and that's why I'm very hopeful that we all connect to the SDGs and support at least one or two that speak to us. To you, that might be climate change, which is SDG 13\. Or maybe SDG 17, which is ‘partnerships for the goals.’ This looks at how we connect with other organizations that also believe in the SDGs, and believe in the environment, social initiatives, governance, diversity, equity, and inclusion. I wanted to give you the big overview and then show you how those connect to ESGs and the people, planet, and profit concept. ![a diagram showing how the SDGs connect to ESG](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/11/ESG-2.png) - Under environmental, you have SDG, 6, 7, 12, 13, 14, and 15\. - For social it’s 1, 2, 3, 4, 5, and 8. - Governance is 9, 10 11, 16, and 17 So we go from a very general concept of ESG to a more specific one. --- [11 must-read FP&A books 📚Get ready to add more titles to your TBR (to be read) list as we reveal the 11 best FP&A books to help you excel within your role.👇🏼![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/books12.jpg)](https://www.financealliance.io/11-must-read-fp-a-books/) --- # How the financial statements of a company inform the impact change Financial statements follow that vision or strategy around cost, profit margins, and the bottom line. But the question always is, how do we incorporate sustainability concepts into our [financial operations](https://www.financealliance.io/scaling-your-saas-finance-operations/) and daily operations as an organization? We all agree that on the financial side, we're always looking to generate revenue. But increasing revenue is the main task. We want to add value and ensure that we become sustainable, that we're not just around for one or two years, and we're there for the long run, and that ties to revenue. So how can we ensure that we're introducing those sustainability concepts and adding value without taking away from our bottom line and cash flows? Sustainability can impact the bottom line and add value just by being thoughtful in the way that we operate. So if we're producing something like packaging, how do we make that packaging more sustainable? How do we recycle items into that packaging so it has a lesser impact on the environment, while also making sure that it ties to our numbers? Instead of increasing the cost of something, how do we make sure that we decrease it or make it more efficient? I believe that sustainability practices have that impact. # Implementing global sustainability projects We can think about using solar energy, wind energy, water efficiency fixtures, and green spaces, and how we can bring all those resources into our operations. Some of you may have manufacturing organizations that can use solar energy instead of regular electricity. We can also buy credits for renewable energy. The good thing about it is that we know how much it's going to cost, so it gives us a good idea of the cost of energy for the next five years, for example. So that's a cost that we can manage. It's also good for the environment, and that's part of the sustainability strategy that you incorporate into your day-to-day operations. # The key advantages of embracing sustainability One of the most important advantages of embracing sustainability is the positive impact that we're going to have, not just on the planet but also on our people. If the planet is healthy then most likely general society will be healthy. And that's good for us because there are fewer expenses on healthcare. We have a healthier population, and therefore we have healthier team members committed to being part of our organizations because they know that we embrace that sustainability strategy. But as a corporation, we also meet public expectations, we take care of our reputation, and we also get good press. Organizations are always interested in ideas or opportunities for good press. We can also think about employee retention. Even when you're looking for new talent, employees are going to be looking for organizations that are going to help them become better citizens and that align with their values. The new generations are especially very concerned about the environment. If you know that that's part of your business strategy as an organization, the team members or future team members are going to be more inclined to give you a chance as their employer because that's one of their biggest concerns. You also get rewarded for good behavior as an organization because now you’re doing what's right for all of us as a global community. Let's not forget that there are many regulations that are being created or developed around ESG. There are lots of laws being created in the EU currently that are probably not set in stone. They're looking for big corporations to give them feedback and more of a partnership between what they think is needed versus what the corporations think is needed. So there will come a time where everything’s going to be aligned and we’re going to have to comply with those regulations, not only because it's the right thing, but also because there's going to be penalties and financial consequences if we don't follow those laws. So it's good to start embracing sustainability practices now if you haven't done so already. Ensuring that we're following what the government is asking from us is not only going to impact us financially, but also by using ESG as part of our strategy, we're able to attract other investors to raise capital. Also, there are financial institutions that are now lending money based partially on your ESG scores. If we can start implementing sustainability concepts into the way that we operate daily, that’ll also help eventually with what's coming. We're always looking to raise capital or looking at institutions to borrow money from. So we have to be proactive around it, and we have an opportunity to do so. --- [AI in Finance eBook | Free DownloadWelcome to the AI in Finance eBook, your trusted guide to merging AI’s vast potential with everyday finance operations such as forecasting, budgeting, analysis, and more.👇![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/FA_AI_in_Finance_Playbook_Blog.png)](https://www.financealliance.io/ai-in-finance-ebook-download/) --- # Examples of sustainable companies ## Nike Nike started introducing sustainability practices in 1979, and they're always using technology to improve their products. But now they're even using technology to improve the soles of their shoes. They’re using recycled materials to produce their shoes. All soles since 2008 have been composed of 50% recycled manufacturer waste. I see spending money as a way of investing money. I know it's going to be an expense, but I like to think that I can do more with the money that I'm going to spend. Instead of just becoming a decrease in my revenue and my income, it's more about, “When I'm buying something, am I being thoughtful about who I'm buying it from?” So if I have to buy shoes, I’ll buy them from Nike because I know that in their operations, they're already thinking about incorporating recycled items to produce their shoes. They have a program where you can bring in your old shoes and get a discount on new shoes that are made with recycled materials. Nike Air’s innovation facilities divert more than 95% of manufacturing waste from landfills. It's great work and you're getting great shoes. Not to mention that they do phenomenal work in advancing social justice and diversity, equity, and inclusion practices. So this is a good example of a great company doing great things. ## IKEA I know you're very familiar with IKEA. For their furniture, they use materials such as cotton, better plastics, and bamboo. They create affordable furniture and energy-saving appliances. Remember, it's not about having to develop or design something with recycled materials or 100% of the product has to be based on recycled materials. That's not the objective. But if we could be more thoughtful about how we’re producing these items and incorporate recycled materials into the products or packaging of the products, that's the solution. And that's what companies like IKEA and Nike are doing. IKEA is reducing food waste by packing lunches, keeping vegetables fresh for longer, and using UTZ-certified teas and coffee. It's not only about producing a product, it's also about who your providers and vendors are. Are you sourcing from women-owned businesses? Are you sourcing from solopreneurs? Are you going to people who can connect you to smaller businesses around your local communities? --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### 7 reasons why FP&A professionals miss the bus URL: https://www.financealliance.io/7-reasons-why-fp-a-professionals-miss-the-bus/ Last updated: 2024-08-15T14:12:28.000Z Financial Planning and Analysis (FP&A) is an essential part of an organization's decision-making process. However, despite its importance, [FP&A professionals](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) sometimes miss the bus when it comes to delivering accurate and meaningful information to the rest of the organization. In this article, we will examine the reasons why FP&A professionals miss the bus and what can be done to avoid it. ## 1\. Lack of data quality One of the primary reasons why FP&A professionals miss the bus is due to a lack of data quality. The success of FP&A depends on having access to accurate, timely, and relevant data. However, in many organizations, the data that is collected and processed is often incomplete, outdated, or inaccurate. This can lead to incorrect projections, miscalculations, and incorrect analysis, which can undermine the credibility of FP&A and ultimately, the decision-making process of the organization. To avoid missing the bus, FP&A professionals must have access to [accurate and reliable data](https://www.financealliance.io/data-cleaning-techniques/). They must also have the tools and processes in place to standardize, clean, and validate the data. ## 2\. Inadequate Technology In today's fast-paced business environment, FP&A professionals must have access to the [right technology](https://www.financealliance.io/podcast/leverage-technology-finance-transformation/) to ensure that they can perform their tasks efficiently and effectively. However, many organizations still use manual processes, spreadsheets, and outdated software, which can lead to errors, delays, and incorrect information. To avoid missing the bus, FP&A professionals must ensure that they have access to the right technology to help them deliver accurate and meaningful information in real-time, such as advanced FP&A software and data visualization tools. --- [Top 20 FP&A skills (10 hard skills & 10 soft skills)Here are the top 20 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/pexels-igoralshin-2873277-2.jpg)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) --- ## 3\. Lack of Communication Another reason why FP&A professionals miss the bus is due to a lack of communication. FP&A professionals often work in isolation, which can lead to misunderstandings, missed deadlines, and incorrect information being shared with the rest of the organization. To avoid missing the bus, FP&A professionals must communicate with the rest of the organization on a regular and effective basis, including the executive team, department heads, and other stakeholders. This can be achieved through regular meetings, presentations, and reporting, as well as making the rest of the organization know that they are available and available. ## 4\. Lack of Strategic Focus FP&A is often seen as a support function, and as a result, the organization's goals and objectives may not be clear to FP&A professionals. This can lead to a lack of alignment between FP&A and the rest of the organization. This can result in a [lack of trust in FP&A](https://www.financealliance.io/fp-a-business-partner/) and incorrect decision-making. To avoid missing the bus, FP&A professionals must ensure that the organization's goals and objectives are clear to them, and that they are aligned with the rest of the organization. This can be achieved through regular communication, collaboration, and engagement with the rest of the organization. ## 5\. Inadequate Business Knowledge Another reason why FP&A professionals miss the bus is due to inadequate business knowledge. FP&A professionals must have a deep understanding of the organization's operations, products, and services to perform their jobs effectively. However, in many organizations, FP&A professionals may not have the necessary business knowledge to perform their jobs effectively. This can lead to incorrect projections, poor decision-making, and a lack of credibility in FP&A. To avoid missing the bus, FP&A professionals must ensure that they have a deep understanding of the organization's products and services, and that they are up-to-date with business changes and new products. This can be achieved through regular training, engagement with the rest of the organization, and by participating in cross-functional teams and initiatives. ## 6\. Insufficient Training and Development Some FP&A professionals miss the bus due to insufficient training and development. In many organizations, FP&A professionals are not given the training and support they need to perform their jobs effectively. This can lead to a lack of knowledge and skills in areas such as data analysis, presentation, budgeting, and forecasting, which can affect FP&A's accuracy and credibility. To avoid missing the bus, FP&A professionals must receive regular training and development, both in-house and through external programs, to keep up to date with the latest information and skills. --- [How to design FP&A team structure (with examples)One of the hardest questions to answer about FP&A is ‘what is the typical FP&A team structure?’ This question is so hard to answer because there is no one-size-fits-all…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePatrick Dennehy![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/Copy-of-FA_Website_Article_Images_Author_Highlight--2-.png)](https://www.financealliance.io/fp-a-team-structure/) --- ## 7\. Poor Priorities Management Finally, some FP&A professionals miss the bus due to poor time management. FP&A professionals are often faced with tight deadlines, multiple projects, and a large volume of data to process. This can lead to stress, burnout, and a lack of focus, which can negatively impact the accuracy and credibility of FP&A. To avoid missing the bus, FP&A professionals must ensure that they have effective time management skills, and that their projects and tasks are prioritized based on their importance and importance. This can be achieved through the use of project management tools and techniques, and by delegating tasks and responsibilities where possible. In conclusion, missing the bus is a common issue faced by FP&A professionals, but it can be avoided by addressing the root causes, such as poor time management, a lack of strategic focus, and a lack of alignment with the rest of the organization. By making sure they have the right resources, support, and skills in place, FP&A professionals can provide the rest of the organization with accurate and meaningful information. This will help improve the organization's overall performance. --- ## **Drive strategic business and career growth with FP&A.** Take your career to the next level with [**FP&A Certified: Core**](https://certified.thealliance.io/course/fpa-certified-core?%5F%5Fhstc=85986695.682ff2e496959034f695a4fff423f6d2.1705586580691.1722844318314.1722929624659.276&%5F%5Fhssc=85986695.3.1722929624659&%5F%5Fhsfp=140557161). Learn to forecast, budget and turn complex data into insights that drive profitable business growth. - Gain an all-in-one, in-depth understanding of financial planning and analysis. - Get practical tools for real-world applications that you can put into action immediately. - Build effective FP&A processes, providing a solid foundation for effective financial planning, insightful analysis, and data-driven decision-making. [Learn more](https://certified.thealliance.io/course/fpa-certified-core?%5F%5Fhstc=85986695.682ff2e496959034f695a4fff423f6d2.1705586580691.1722844318314.1722929624659.276&%5F%5Fhssc=85986695.3.1722929624659&%5F%5Fhsfp=140557161) ### FP&A Summit speaker spotlight with Mathew Reynders URL: https://www.financealliance.io/fp-a-summit-speaker-spotlight-data-storytelling-for-fp-a/ Last updated: 2024-08-09T09:13:49.000Z Translating complex financial data into a narrative that resonates with stakeholders is an *invaluable* skill for FP&A professionals. This isn't just about crunching numbers; it’s about weaving them into a [compelling story](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/) that drives decisions and inspires action. As we gear up for the [FP&A Summit](https://events.financealliance.io/location/boston?) in Boston, we spoke with [Mathew Reynders](https://www.linkedin.com/in/mathewreynders/), Vice President of FP&A at Outbrain, who believes that mastering the art of storytelling is the key differentiator for financial leaders today. In this exclusive interview, Mat shares how the power of narrative can elevate the role of FP&A professionals from data analysts to trusted advisors. ### **1\. Mat, can you tell us about yourself?** I’m Mat Reynders – Vice President of FP&A for Outbrain. My career has spanned the media and technology landscape – with roles in finance, operations, and sales. Today, my responsibilities include financial forecasting, budgeting, [M&A analysis](https://www.financealliance.io/m-a-best-practices/), and capital market guidance for one of the largest advertising technology firms in the world. I live in northern New Jersey with my wife and a very energetic 5-year-old – and when I have a moment, I enjoy playing golf. ### **2\. What will you be speaking about at our event?** ![FP&A Summit speaker spotlight with Matthew Reynders](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/08/Quote-3-1.png) My session will focus on the role of FP&A professionals as storytellers. While needing to be grounded in facts and numbers, I have found that the best financial leaders are also masterful storytellers. They can succinctly explain business performance to those who don’t live in numbers all day – and easily help others to make informed decisions quickly. I’ll also discuss how finance leaders – and aspiring executives – can leverage their knowledge and expertise to become key advisors – all by using communication and preparation to tell a concise story. ### **3\. What is the main message or key takeaway you hope attendees will gain from your presentation?** I hope that attendees will think about the ways they can better leverage their own experience and expertise in their communications. Some of the most skilled finance professionals aren’t recognized because they can’t explain their observations clearly. With an organized approach, knowledge can be easily shared and understood – helping leaders and fellow team members to make critical decisions with better information. --- [How to design FP&A team structure (with examples)One of the hardest questions to answer about FP&A is ‘what is the typical FP&A team structure?’ This question is so hard to answer because there is no one-size-fits-all…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePatrick Dennehy![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/Copy-of-FA_Website_Article_Images_Author_Highlight--2-.png)](https://www.financealliance.io/fp-a-team-structure/) --- ### **4\. Who is your ideal attendee for this event, and why would your presentation be valuable to them?** I believe that this topic is broad. Anyone who works with [financial data](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/), makes business decisions, or communicates with decision-makers can benefit from a thoughtful approach to [storytelling](https://www.financealliance.io/mastering-data-storytelling/). ### **5\. What are you looking forward to the most about the event?** I look forward to connecting with a wide array of finance leaders to learn about their approaches. ![FP&A Summit speaker spotlight with Matthew Reynders](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/08/Quote-2-1.png) ### **6\. What's the best career advice you’ve ever received?** **1\. Spend a lot of time outside of your comfort zone**. Try a different job, sign up for a new task, or take rotation that you have never done before. You’ll learn both from experience, as well as the process of convincing yourself and others that you can do it. **2\. Double-check your work**. There’s no better way to undermine your credibility than to move too fast, make a mistake, and waste others’ time. ### **7\. Can you provide a brief teaser of what attendees can expect from your presentation?** What do Oprah Winfrey, Nikki Glaser, and Barack Obama all share with a room full of finance professionals? It’s simpler than you might think…. This will be a lighthearted approach to a *very* serious skill. ![FP&A Summit speaker spotlight with Matthew Reynders](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/08/Quote-1-1.png) Teammates, [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/), or shareholders want to understand key financial details without combing through spreadsheets. Finance leaders who can summarize and clearly share those key bullets separate themselves by demonstrating their knowledge and skill. But what looks simple requires time and training to ensure that the story is solid and succinct. ### **8\. What advice would you give to young professionals starting out in the finance industry?** Take time to understand how things work – and the reasons behind them. It’s easy to receive a set of data that shows performance without trying to understand what those numbers reflect. While simply processing information might get the job done faster – at the next level, you’ll need to understand what made the widget sell faster in June. And if you don’t know what the widget does – or that it sells best in the summer – it will be impossible to explain the performance. For finance leaders, understanding the '**what*' becomes critical to explaining the '**why*' – so start early! ### **9\. How can attendees connect with you after the event to learn more?** Attendees are welcome to connect with me via [LinkedIn](https://www.linkedin.com/in/mathewreynders/) – or email me at mreynders@outbrain.com. I would welcome the chance to connect and I’m happy to answer any questions or share more information. --- ## **Don't miss Mathew's upcoming talk at the FP&A Summit Boston!** **Session title:** *Data storytelling for FP&A: Turning numbers into narratives that drive results* **Unlock the power of data storytelling!** Join us as Mat not only takes the stage, but takes you on a journey *beyond* charts and graphs, teaching you how to craft compelling narratives that resonate with stakeholders and inspires informed decision-making Whether you’re a seasoned finance professional or just starting out, this session is your key to transforming raw data into powerful stories that lead to big changes (for both the business and your career). Be there to elevate your storytelling skills and make an impact! See you at the [FP&A Summit Boston](https://bit.ly/3YyjkJG)! [Book your ticket](https://bit.ly/3YyjkJG) ### 12 financial modeling best practices to avoid frustrations URL: https://www.financealliance.io/12-financial-modeling-best-practices-to-avoid-frustrations/ Last updated: 2026-03-19T09:38:38.000Z Today, I'm going to go talk about financial modeling best practices. If someone asked me what are a few things you should do to become better at financial modeling, this is exactly what I would tell them. If you're new to finance and FP&A, learning about financial modelling can be overwhelming. Let me tell you: Dealing with complicated and broken financial models can be *very* frustrating. It results in chaos, adds so much stress, and fixing errors in the complex model is a real challenge. I don't want you spend hours and hours working on a broken financial model or finding and fixing errors which could've been avoided in the first place. Whether you're just starting in finance and [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) or if you're working on your next financial model soon, these 12 tips will be very handy. So, let's dive in! ### Tip 1: Avoid duplicate inputs Hard coding an input more than once can lead to inefficiencies, increased chances of errors, and difficulties in maintaining and updating the model. When you re-enter the same input in different places, it not only consumes more time but also makes the model less flexible. You should aim for a dynamic approach where inputs are defined once and referenced as needed throughout the model. ### Tip 2: Do not calculate more than once Recalculating the same values multiple times not only consumes computational resources but also introduces the possibility of inconsistencies. By referring back to the initial calculations, you make your model more robust and consistent. If you make an error. This makes troubleshooting issues and finding errors a lot easier. --- [Top 20 FP&A skills (10 hard skills & 10 soft skills)Here are the top 20 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/pexels-igoralshin-2873277-2.jpg)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) --- ### Tip 3: Avoid numbers in formulas When you include numbers within formulas, especially hard-coded numbers, it makes the model rigid and less adaptable to modifications. There can be an exception to this rule when a number is truly constant, meaning it will never change throughout the model's lifecycle. ### Tip 4: Avoid long formulas. Long formulas can be hard to understand, not only for you as a model creator but also for anyone who may need to refer, review or modify the model later on. Try using [Excel](https://www.financealliance.io/gpt-4o-mini-in-excel-google-sheets/) formulas that are clear, concise and logically structured. Break down complex calculations into smaller, manageable steps. ### Tip 5: Grouping vs hiding rows and columns It's advisable to group rows and columns instead of hiding them. Hidden rows and columns usually result in a lack of visibility, potentially causing confusion or oversight. Grouping rows and columns increases transparency and helps to [clearly organize data](https://www.financealliance.io/data-cleaning-techniques/) in the model. ### Tip 6: Center align vs merge cells Whenever you feel like merging a cell in the model, consider using the Center Across Selection formatting option instead of merging cells. Merge cells usually lead to complications and reduced flexibility. While if you use Center Across Selection, this will maintain individual cell functionality while visually centering content. --- [How to design FP&A team structure (with examples)One of the hardest questions to answer about FP&A is ‘what is the typical FP&A team structure?’ This question is so hard to answer because there is no one-size-fits-all…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePatrick Dennehy![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/Copy-of-FA_Website_Article_Images_Author_Highlight--2-.png)](https://www.financealliance.io/fp-a-team-structure/) --- ### Tip 7: Footnotes & comments Adding footnotes and comments is always a good practice to improve clarity and provide additional context inside the model. **Footnotes:** Can be used to explain assumptions, methodologies, or any important points for users. They appear at the bottom of the model and show up when the model is printed. **Comments:** They are built Within cells allowing for real-time collaboration and ensuring that more details are accessible to anyone reviewing the [financial model](https://www.financealliance.io/10-best-financial-modeling-tools/) for internal purpose. ## Other tips ... **Tip 8:** Structure your model as clearly and simply as possible **Tip 9:** The Model should be usable in your absence. You can include an instruction tab which can help other users to navigate through the model. **Tip 10:** Assumptions should be in one place. Including an “Assumptions” tab in the model where all the assumptions are documented is a very good practice. **Tip 11:** Save your work often. Press “Ctrl + S” every few minutes if you are working on your local machine. **Tip 12:** Take a step back and look at the bigger picture during the design stage to avoid rework later. --- ## **Drive strategic business and career growth with FP&A.** Take your career to the next level with [**FP&A Certified: Core**](https://certified.thealliance.io/course/fpa-certified-core?%5F%5Fhstc=85986695.682ff2e496959034f695a4fff423f6d2.1705586580691.1722844318314.1722929624659.276&%5F%5Fhssc=85986695.3.1722929624659&%5F%5Fhsfp=140557161). Learn to forecast, budget and turn complex data into insights that drive profitable business growth. - Gain an all-in-one, in-depth understanding of financial planning and analysis. - Get practical tools for real-world applications that you can put into action immediately. - Build effective FP&A processes, providing a solid foundation for effective financial planning, insightful analysis, and data-driven decision-making. [Learn more](https://certified.thealliance.io/course/fpa-certified-core?%5F%5Fhstc=85986695.682ff2e496959034f695a4fff423f6d2.1705586580691.1722844318314.1722929624659.276&%5F%5Fhssc=85986695.3.1722929624659&%5F%5Fhsfp=140557161) ### 10 innovative structured capital strategies in corporate finance URL: https://www.financealliance.io/10-structured-capital-strategies/ Last updated: 2025-04-07T16:34:50.000Z ## **What are structured capital strategies?** Structured capital strategies are smart financial plans companies, and investors use to tackle money challenges or reach financial goals. Capital strategies like these usually combine [financial tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/) like debt, equity, and derivative securities. This approach is all about: - Securing funding efficiently - Protecting your company from financial risks - Hitting specific financial targets Every business has its own unique financial needs and market pressures. With structured capital strategies, you can access diverse funding sources, tailor financial products to specific needs, and achieve strategic goals such as expansion, [acquisition](https://www.financealliance.io/m-a-best-practices/), or restructuring. Whether you're looking to manage risk, increase liquidity, or fund growth, these 10 structured capital strategies could be just what you need to outsmart the market. ## **10 structured capital strategies** ### **1\. Mezzanine financing** If you can get past the strange name, mezzanine financing can be very useful as a capital strategy because it's like a hybrid of debt and equity financing. You borrow money, but the lender can also become a part-owner if you can't repay it. They get paid after everyone else who's lent you money (such as [venture capital](https://www.financealliance.io/5-startup-vc-funding-tips/) companies, etc.). It’s most commonly used when companies are buying other companies or growing incredibly fast. Although it offers higher returns to investors compared to traditional debt, it does carry higher risk. For this reason, investors often expect a higher return. They usually want to earn [12-20%](https://corporatefinanceinstitute.com/resources/commercial-lending/mezzanine-financing/#:~:text=Mezzanine%20Financing%20Rate%20of%20Return&text=As%20mezzanine%20financing%20is%20unsecured,of%20return%20on%20ordinary%20debt.), which is more than you'd pay for a normal loan. ### **2\. Securitization** Securitization is like bundling a bunch of loans together (like mortgages or car loans) and selling pieces of that bundle to investors. You essentially sell their related [cash flows](https://www.financealliance.io/cash-flow-drivers-in-a-business/) to third-party investors as securities. This helps companies get rid of loans and get cash faster. It also spreads the risk around, so if some people don't pay back their loans, it doesn't hit the company as hard. --- [Introducing FP&A Certified: CoreTake your career to the next level with our FP&A Core course. Learn to forecast, budget and turn complex data into insights that drive profitable business growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/08/FA_FP-A_Core_Meta_.png)](https://www.financealliance.io/introducing-fp-a-certified-core/) --- ### **3\. Convertible bonds** Convertible securities are bonds and preferred shares that can be converted into a predetermined number of the issuing company's shares. They’re useful for both investors and companies: - **For investors**, it's like having a safety net (the loan part) with a chance to win big (if the company does well, the shares go up). - **For companies**, they can borrow money at a lower rate because investors have a chance to make more money. ### **4\. Credit derivatives** Credit derivatives are financial bets on whether someone (like a company or a country) will pay back their debts. Instead of buying their actual loan, you're purchasing an insurance policy of sorts. One of the most famous credit derivatives is a Credit Default Swap (CDS). This lets [companies manage risk](https://www.financealliance.io/financial-crime-risk-management-fcrm/) by transferring it to other parties. These can be used to hedge against potential credit events like defaults or downgrades. Credit derivatives were a big part of the 2008 financial crisis because they got really complicated and risky. ### **5\. Structured notes** Another commonly used structured capital strategy involves debt securities with embedded derivatives, which provide a customized risk-return profile. These notes are linked to various underlying assets, such as stocks, commodities, or interest rates. By combining debt with derivatives, issuers can create a wide range of payoff structures to meet diverse investor preferences. Structured notes can be tailored to specific investment objectives, offering potential upside while often providing some downside protection. However, their complexity and lack of liquidity can be a problem. ### **6\. Asset-backed securities (ABS)** ABS are bonds or notes backed by financial assets such as loans, leases, credit card debt, or receivables. This provides a way to raise funds by leveraging asset [portfolios](https://www.financealliance.io/client-portfolio-fractional-cfo/) while diversifying risk by pooling assets. According to the [Asset-Backed Securities Global Market Report 2024](https://www.thebusinessresearchcompany.com/report/asset-backed-securities-global-market-report#:~:text=The%20asset%2Dbacked%20securities%20market%20size%20has%20grown%20strongly%20in,%28CAGR%29%20of%207.2%25.), the ABS market size will likely see strong growth over the next few years. It’s expected to grow to **$3112.45 billion** in 2028 at a compound annual growth rate (CAGR) of **6.3%**. ### **7\. Private placements** A private placement is when a company sells securities directly to a select group of investors, bypassing the public market. It's a key component of structured capital strategies, offering tailored financing solutions. Compared to public offerings, private placements are less bureaucratic, quicker to execute, and allow for more flexible terms. However, [McKinsey Global Private Markets Review](https://www.mckinsey.com/industries/private-capital/our-insights/mckinseys-private-markets-annual-review) revealed that private markets actually entered a slower era in recent years with “*macroeconomic headwinds, rising financing costs and an uncertain growth outlook weighing on fundraising, deal activity, and performance.”* Despite these headwinds, private placements remain a valuable option for companies with a clear growth strategy and the ability to navigate the complexities of the private market. --- [What is economic analysis? (Definition, examples, and more)It’s a question that should be at the forefront of every CFO’s mind. Yet, some are still unsure about what economic analysis is and what it involves. This guide explains economic analysis: what it is, why it matters, and how to do it.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/what-is-economic-analysis-2.png)](https://www.financealliance.io/what-is-economic-analysis-the-question-every-cfo-should-be-asking/) --- ### **8\. Recapitalization** [Wall Street Prep](https://www.wallstreetprep.com/knowledge/recapitalization/) defines recapitalization as a catch-all term “*referring to measures taken by companies to adjust the debt-to-equity (D/E) mixture within their capital structures*.” There are different forms of recapitalization including debt-to-equity swaps, issuing new equity, and refinancing debt. This type of [capital](https://www.financealliance.io/multiple-on-invested-capital-moic/) strategy is used to stabilize a company’s capital structure, typically after a significant event such as a buyout. Companies usually choose recapitalization from other structured capital strategies to improve financial stability, manage leverage, or during restructuring. Recapitalizations were a key strategy for companies during the COVID-19 pandemic to manage liquidity. ### **9\. Tax-advantaged financing** Tax-advantaged financing is a way for companies to optimize the tax position of a company, such as: - **Tax-exempt bonds** are loans where the interest you pay isn't taxed. Think of municipal bonds used to build schools or roads. - **Tax credit investments** let you invest in projects like affordable housing and get a tax break in return. The big benefit for companies is a lower overall cost of capital. Less tax means more money to reinvest in the business. ### **10\. Hybrid securities** Hybrid securities are financial instruments that blend the characteristics of both debt and equity. They're like a financial chameleon, changing color depending on how you look at them. Common types include preferred stock, equity-linked debt, and convertible preferred stock. These securities typically offer a fixed income component, similar to a bond, but also have the potential for equity upside, like a stock. For companies, hybrid securities offer flexibility in their capital structure. They can be used to raise money without diluting ownership as much as issuing common stock, while also providing a lower cost of capital compared to traditional debt. --- [Multiple on Invested Capital (MOIC): Definition & guideIn this article, we’re zeroing in on MOIC to uncover what it is, its role in private equity, and more importantly, how you can use it to sharpen your investment evaluation skills.r![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/FA_Framework_Tiles_2_capital_allocation.jpg)](https://www.financealliance.io/multiple-on-invested-capital-moic/) --- ## **Equitable structured capital strategies** Equitable structured capital strategies focus on sharing risks and rewards equally among investors, companies, and others involved. The goal? To close the gap between those who have access to capital and those who don't, ensuring that everyone benefits. Key elements of equitable structured capital strategies include: - **Inclusive access to capital:** Making sure everyone from small to minority-owned businesses, have access to structured financing options. - **Fair risk distribution:** Sharing the risk of [investments](https://www.financealliance.io/chief-investment-officer-vs-chief-financial-officer/) equally among everyone involved. - **Transparent practices:** Being open and honest about how investments work helps to build trust and ensure all stakeholders understand the terms and conditions. - **Balanced returns:** Creating financial products that offer equitable returns to all investors. - **Sustainable and ethical considerations:** Investing in a way that's good for the planet and people. - **Regulatory compliance:** Ensuring that all structured capital strategies comply with [relevant regulations](https://www.financealliance.io/finance-and-compliance/) and promote fair market practices. --- ## FAQs: Capital strategies What is the capital strategy? A capital strategy is a comprehensive plan developed by a company or investor to manage its capital resources effectively. What is the capital plan strategy? A capital plan outlines how a company manages its money. It covers spending plans, funding sources, dividends, debt repayments, and back-up plans to ensure financial health and growth. What is a capital intensive strategy? Capital intensive strategy means investing heavily in physical assets like machinery, equipment, and infrastructure. This approach is common in manufacturing, energy, and telecommunications industries. It helps achieve economies of scale, boost productivity, and stay ahead of competitors. Can you share an example of a capital plan? An example of a capital plan is a company's annual budget for capital expenditures, which details planned investments in property, plant, and equipment. What is a capital preservation strategy? A capital preservation strategy focuses on protecting the principal investment amount while minimizing the risk of loss. This approach typically involves investing in low-risk, highly liquid assets such as government bonds, high-quality corporate bonds, and money market funds, aiming for stable, modest returns to ensure the safety of the invested capital. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### How to design FP&A team structure (with examples) URL: https://www.financealliance.io/fp-a-team-structure/ Last updated: 2026-03-19T09:10:16.000Z One of the hardest questions to answer about financial planning and analysis (FP&A) is ‘what is the typical FP&A team structure?’ This question is so hard to answer because there is no one-size-fits-all. Instead, it depends on numerous factors like company size, funding, revenue, profit, growth rate, public or private, complexity, locations, and subsidiaries, etc. So, determining how *big* your FP&A team should be really comes down to capacity and budget. --- ### Table of contents: - [Signs it's time to expand your FP&A team](https://www.financealliance.io/p/fd72d857-89de-43f6-ba96-402895b9b2cc/#when-should-you-expand-your-fpa-team) - [FP&A team structure at a startup ](https://www.financealliance.io/p/fd72d857-89de-43f6-ba96-402895b9b2cc/#start-up-company-small-business) - [FP&A team structure at a private company](https://www.financealliance.io/p/fd72d857-89de-43f6-ba96-402895b9b2cc/#private-company-fpa-team-structure) - [CFO role within FP&A](https://www.financealliance.io/p/fd72d857-89de-43f6-ba96-402895b9b2cc/#cfo-role-within-fpa-team) - [Leader of FP&A team (role)](https://www.financealliance.io/p/fd72d857-89de-43f6-ba96-402895b9b2cc/#leader-of-fpa-role) - [How FP&A teams interact with other departments ](https://www.financealliance.io/p/fd72d857-89de-43f6-ba96-402895b9b2cc/#how-fpa-teams-interact-with-other-departments) --- ## **When should you expand your FP&A team?** If the workload is becoming unmanageable for yourself or your existing team, it’s likely time to find either additional resources or solve the problem with software. Of course, these decisions need to make sense from a budgetary perspective. Growing an [FP&A team](https://www.financealliance.io/how-fp-a-teams-calculate-and-reduce-customer-churn/) too large too quickly when revenue growth isn’t there to support it is *usually* a bad idea. Timing the growth of your team right so you *aren’t* in an urgent situation to get resources hired is critical to a healthy FP&A function. So, let’s discuss some different company sizes and what an FP&A team would typically look like for each. ## FP&A structure: Start-up company (small business) Let’s assume we're discussing a start-up in the [early stages of fundraising](https://www.financealliance.io/5-startup-vc-funding-tips/) (Seed or Series A) with low revenue. ![FP&A team structure - early stage startup](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/08/fp-A-team-structure-2.png) **Source:* [**FP&A Certified Core course*](https://certified.thealliance.io/course/fpa-certified-core?%5F%5Fhstc=85986695.682ff2e496959034f695a4fff423f6d2.1705586580691.1722441198973.1722502376661.260&%5F%5Fhssc=85986695.6.1722502376661&%5F%5Fhsfp=2204740532) This type of company may require what's called a senior-level “individual contributor”. This person may join the company as a VP of Finance all the way up to a [CFO](https://www.financealliance.io/cfo-vs-controller/), but would typically be handed the full workload of the finance team (maybe one analyst if they're lucky). In this situation, this person would need to be highly skilled in modeling to establish a [working budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), forecast, long-term plan, and other strategic modeling needed while also being a key decision-maker in how the company’s money is used. They would also, in many situations, manage the accounting function with a resource there to [close the books](https://www.financealliance.io/month-end-close-checklist/). This is a highly visible, heavy workload role that can have outsized benefits in terms of career growth or potential equity gains. --- [Recruitment in finance: 4 hiring hacks (FP&A talent)Recruiting in finance isn’t easy and I know this because I recently went through the process of building an FP&A team myself. During that experience, I quickly learned that people set parameters based on what they think the FP&A team should look like.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePatrick Dennehy![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/recruitment-in-finance1-1.png)](https://www.financealliance.io/recruitment-in-finance-4-hiring-hacks/) --- ## Private company FP&A team structure Now, let’s look at this same company and assume they have grown to now be a private company with 500 employees and over $100M in revenue. Here's a visual for what the FP&A team structure might look like for this type of company: ![FP&A team structure](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/08/fp-A-team-1.png) **Source:* [**FP&A Certified Core course*](https://certified.thealliance.io/course/fpa-certified-core?%5F%5Fhstc=85986695.682ff2e496959034f695a4fff423f6d2.1705586580691.1722441198973.1722502376661.260&%5F%5Fhssc=85986695.6.1722502376661&%5F%5Fhsfp=2204740532) This team would be expected to be far more robust. The top of the finance team would almost certainly be a Chief Financial Officer (CFO) or equivalent senior executive in finance. Underneath the CFO would be a leader of FP&A, which could be a wide range of titles but typically a Director, Senior Director or Vice President level. Depending on the complexity of the business (Software-as-a-Service (SaaS), manufacturing, consumer goods, etc.), there could be different needs so let’s assume this is a SaaS business. You would expect anywhere from 2-3 workers underneath the FP&A leader at the analyst and/or manager levels. The necessity around this would be for [FP&A business partnering](https://www.financealliance.io/fp-a-business-partner/) (presenting monthly reporting to the department leaders and budgeting) and strategic FP&A (long-term modeling, planning, and [forecasting](https://www.financealliance.io/rolling-forecast-best-practices/)). The more the business expects to see in terms of reporting and the quicker they expect it, the more resources are needed to support this. So, your FP&A team structure may look larger or smaller depending on the demands of leadership, investors, and the Board. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/FP-A-career-salary-and-path-2.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## CFO role within FP&A team These levels within an FP&A function work in very different ways. The CFO will interact with the board, investors, and the C-level co-workers while delegating all major functions within the finance team to their direct reports. The role is typically very hands-off in terms of work product (actually building or interacting with models) but instead, [storytelling](https://www.financealliance.io/mastering-data-storytelling/) based on the information given and maintaining a critical eye at all times. ## Leader of FP&A role The VP or director level is the layer of protection between the analyst or manager level and the CFO. They're tasked with managing the whole FP&A function, ensuring all processes are carried out seamlessly and on time and any errors are caught before arriving with the CFO. This person needs to be a master delegator, a hirer of people, and a great manager to be successful. The analysts and managers should drive the majority of the work product but the Director or VP should know the P&L better than anyone else in the company. Each person within the FP&A team has a different level of involvement at each stage, but the role must shift the more senior you become. --- [9 FP&A exit opportunities to consider | Finance AllianceConsidering FP&A exit opportunities? Whether you’re searching for your next big challenge or simply curious about what you can do with FP&A experience, this blog post is tailored just for you.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/03/FP-A-exit-opportunities.jpg)](https://www.financealliance.io/fp-a-exit-opportunities/) --- ## How FP&A teams interact with other departments You may be asking how this FP&A team interacts with the rest of the company. Well, the answer is they should be interacting with *all* departments across the company in some capacity. ### FP&A team & accounting First and foremost, FP&A should be joined at the hip with [accounting](https://www.financealliance.io/fp-a-vs-accounting-key-differences-every-finance-pro-should-know/). Understanding the close process, how things are booked into the general ledger (GL), how to find what you need within their accounting software, etc. are necessities to function well within FP&A. ### FP&A team & leadership Leadership interactions, both at the C-level and within each department, are what establishes a healthy [business partnering model](https://www.financealliance.io/finance-business-partnering-playbook-2/). You must do this to ensure you are relied on for decision-making and viewed as a valued thought partner. ### FP&A team & corporate development Depending on company size, you may have a corporate development team. If you do, you likely work on several long-term strategic models with them around growth opportunities for the company. These can sometimes be the most interesting part of the job. ### FP&A team & sales Interacting with sales is a must. Being on the same page with the [sales forecast](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) so you may better forecast revenue is one of the most important things in FP&A. These are just some of the countless interactions FP&A needs to maintain across a business. In summary, FP&A is the glue that keeps the company together. The expectation is to support all functions and arm them with financial data to drive success, whatever form that comes in. That is why it is one of the most critical in any business. --- ### FAQs How are FP&A teams structured? FP&A teams are usually structured with a hierarchy that includes roles such as analysts, senior analysts, managers, directors, and a vice president or head of FP&A. Each level has increasing responsibilities, from data gathering and basic analysis to strategic planning and decision-making support. What does a good FP&A team look like? A good FP&A team is well-rounded, combining strong analytical skills, business acumen, and effective communication. They are proactive, collaborative, and adept at leveraging technology to provide insightful financial forecasts and strategic recommendations. What are the tasks of an FP&A team? FP&A teams handle tasks such as budgeting, forecasting, financial analysis, variance analysis, and strategic planning. They also prepare reports for senior management, analyze financial trends, and provide insights to support decision-making processes. How do I build an FP&A department? Building an FP&A department involves hiring skilled professionals, implementing robust financial software, and establishing clear processes for budgeting, forecasting, and reporting. Training and continuous development are crucial to ensure the team stays updated with best practices and industry trends. What is the group structure of FP&A? The group structure of FP&A often includes specialized teams focusing on different areas such as corporate finance, business unit support, strategic planning, and reporting. This allows for a more focused approach to managing various aspects of financial planning and analysis. --- ## Take your career to the next level with FP&A Certified: Core Ready to improve your financial planning and analysis (FP&A) skills and skyrocket your career growth? Our [FP&A course](https://certified.thealliance.io/course/fpa-certified-core?%5F%5Fhstc=85986695.682ff2e496959034f695a4fff423f6d2.1705586580691.1722502376661.1722506729857.261&%5F%5Fhssc=85986695.1.1722506729857&%5F%5Fhsfp=2204740532) is your gateway to mastering the skills and know-how needed to drive strategic business growth with the power of FP&A. Learn from FP&A experts like: 🎓 **Patrick Dennehy -** Senior Director, Finance at Kyruus Health. 🎓 **Diego Carlesso** \- Head of Finance Integrated Supply Chain at Philips. 🎓 **James Mannering** \- Owner & Operator at Lamson Consulting. 🎓 **Jay Millstone** \- Director of Financial Planning & Analysis at Topa Insurance Company. 🎓 **Bill Singh** \- Vice President of Financial Planning & Analysis at Genting Americas Inc. 🎓 **Eric Rosen** \- Director of Finance at Ordergroove. Find out more about this course including your coaches, the curriculum and what's included.👇🏼 [Learn more](https://certified.thealliance.io/course/fpa-certified-core?%5F%5Fhstc=85986695.682ff2e496959034f695a4fff423f6d2.1705586580691.1722502376661.1722506729857.261&%5F%5Fhssc=85986695.1.1722506729857&%5F%5Fhsfp=2204740532https://certified.thealliance.io/course/fpa-certified-core?%5F%5Fhstc=85986695.682ff2e496959034f695a4fff423f6d2.1705586580691.1722502376661.1722506729857.261&%5F%5Fhssc=85986695.1.1722506729857&%5F%5Fhsfp=2204740532) ### Introducing FP&A Certified: Core URL: https://www.financealliance.io/introducing-fp-a-certified-core/ Last updated: 2025-04-10T07:45:38.000Z ### **Drive strategic business and career growth with FP&A** Take your career to the next level with our FP&A Core course. Learn to forecast, budget and turn complex data into insights that drive profitable business growth. ⭐ **5+** hours of content ⭐ **Actionable** coursework tasks ⭐ **Bespoke** templates & frameworks ⭐ **Expert** insights ⭐ **100%** self-paced ⭐ **Official** certification [Get certified](https://productmarketingall.typeform.com/to/nRVDlvhD?utm%5Fsource=xxxxx&utm%5Fmedium=xxxxx&utm%5Fcampaign=xxxxx&utm%5Fterm=xxxxx&utm%5Fcontent=xxxxx&typeform-source=certified.thealliance.io) ### **Course overview** Ready to improve your financial planning and analysis skills and skyrocket your career growth? Our FP&A course is your gateway to mastering the skills and know-how needed to drive strategic business growth with the power of FP&A. This course is your comprehensive guide to mastering FP&A, including insights, case studies, and practical templates you won't find elsewhere. Whether you're an aspiring FP&A professional or you’ve been in the thick of it for a few years, this course is key to building your expertise. Develop the ability to tell compelling stories with data, align financial strategies with business goals, and drive financial excellence that fuels growth for your organization and accelerates your career. ### **By the end of this course you’ll be able to..** - **Build accurate forecasts:** Ditch the guesswork and learn to create accurate predictions to build rock-solid financial plans and forecasts. - **Turn data into insights:** Develop the ability to transform complex financial data into clear, insightful narratives that help stakeholders make informed decisions. - **Become a business partner:** Go beyond the traditional boundaries of financial planning and analysis by embracing the role of a strategic business partner. [Get certified](https://productmarketingall.typeform.com/to/nRVDlvhD?utm%5Fsource=xxxxx&utm%5Fmedium=xxxxx&utm%5Fcampaign=xxxxx&utm%5Fterm=xxxxx&utm%5Fcontent=xxxxx) ## **What's included when I enroll?** ### **Content** Comprehensive course material that unravels the complexities of financial planning and analysis, designed to sharpen your skills and deepen your understanding. ### **Coursework** Immersive hands-on activities and real-world case studies that provide a practical grasp of building and implementing FP&A frameworks. ### **Footage** 8 modules of expert video lessons that break down intricate FP&A concepts into digestible content that’s easy to understand and apply. ### **Exams** Test your knowledge throughout the course with regular exams to help you internalize the concepts and principles of FP&A. ### **Templates** Get access to battle-tested templates and frameworks that you can seamlessly integrate into your workflow, saving you valuable time and effort while providing a solid foundation for implementing effective FP&A strategies. ### **Access** Enjoy unlimited and lifetime access to the course. So you can revisit lessons, refresh your skills, or dive deeper into specific areas anytime you want. ## **Looking to learn as a team?** If you're looking to get a team of three or more certified, then speak to Matt about team rates on [m.booth@teamalliance.com](mailto:m.booth@teamalliance.com). P.S. If you need help convincing your boss, we've done the hard work for you. [Convince your boss](https://docs.google.com/document/d/142WbJQShHNB90k5hLCgfh1Anf64KKy5Fp4%5FGW2-pRKA/edit?usp=sharing) ## FAQs #### What is the FP&A Core course? FP&A Core is a comprehensive course that equips you with expert knowledge and practical skills in financial planning and analysis. With 8 modules, bespoke templates and exam questions, this self-paced program covers budgeting, forecasting, reporting, modeling, data analytics, and strategic FP&A. Gain the know-how and tools to master FP&A and translate complex data into insights that drive business decisions and real success. #### Who’s this FP&A Core course for? This course is specifically designed for financial planning and analysis professionals wanting to further develop their skills and career in FP&A. #### How does the FP&A Core course work? The course is completely on-demand, so you can take it at your own pace. You’ll work through the modules chronologically, participate in activities, and complete mandatory exam questions at the end of each module to consolidate your knowledge. If you pass all the exams, you’ll officially be FP&A Core certified. #### How long will FP&A Core course take to complete? You can take however long you need to work through the materials, it’s completely flexible. The course consists of 5+ hours of on-demand content, including activities and exams. #### How long will I have access to the course content? For life! A one-off payment gives you unlimited to all the course’s content. #### How much does the FP&A Core course cost? $1,299\. With this investment, you'll have a blueprint for becoming an expert in financial planning and analysis, essential for thriving in a strategic finance career. This includes on-demand course content, templates to put theory into practice, and coursework to solidify your learning. #### What happens if I don’t pass the course exams? If you fail the first time around you'll be given the option to retake the exam. If you fail the second attempt, unfortunately, it means you won’t get the certificate. However, all’s not lost – you’ll have still learned lots and you’ll be given access to the course materials for life, so you can brush up on the bits you slipped up on. ### 5 startup & VC funding tips (and the importance of accelerators) URL: https://www.financealliance.io/5-startup-vc-funding-tips/ Last updated: 2025-04-05T07:25:24.000Z Let me start by saying that fewer than 1 in 10,000 new businesses in the US receive venture capitalist (VC) funding, so being backed by VC is by itself a very difficult task. Moreover, current research shows that female entrepreneurs still face a lot of additional difficulties during negotiations with VCs related to gender-related biases. It was shown that female founders need to make a lot more efforts before their negotiations with VCs could even begin, otherwise it could be hard for them to present their ideas in the first place. The most plausible reason for that is that there are simply not a lot of women working in VCs which usually supply startups with funding. Research indicates that only **7%** of partners of the top 100 VC firms are females. Participation of females in the venture capital (VC) industry remained dramatically low even after unprecedented growth years of early 2000s. It’s in line with the fact that venture capital firms usually consist of less than 10 people and are historically male dominated. Due to a very narrow focus of VC firms as well as the fact of their small size, even for qualified females it’s a very hard task to begin working for a VC firm. In 2008, only 3.8% startups were founded solely by female entrepreneurs in the US. In 2022, the situation improved and there were 7.2% of new ventures founded by women. On the other hand, funding for female-led startups didn’t change much during all those years, they had just 1.8% of all VC capital in 2008 and in 2022 it went up just by 0.1% to 1.9%. --- [Top 20 Q’s from Fractional CFOsHere are the top 20 questions you might have when planning the transition to fractional CFO…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePeter Turner![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/Copy-of-FA_Website_Article_Images_Author_Highlight-2.png)](https://www.financealliance.io/top-20-qs-from-fractional-cfos/) --- ## 5 Tips to help secure start-up financing While working at one of the largest accelerators for startup companies in Houston, Texas; I also first handedly observed very similar picture of female founded startups underfunding. But based on my experience, I would also like to give some advice to female founders of how to increase their chances of being funded. ### 1\. Embrace acceleration programs First, you need to embrace the importance of acceleration programs. Accelerators connect founders with mentors, potential investors, and other entrepreneurs. These connections are invaluable for gaining insights, finding funding, and navigating the startup ecosystem. Attend workshops, networking events, and conferences to [expand your network](https://www.financealliance.io/11-networking-in-finance-tips/) as well. Participating in an accelerator introduces founders to the broader startup universe within their city or region. Understanding local dynamics and building relationships can open doors for collaboration and growth. Engage with local industry associations, chambers of commerce, and entrepreneurial communities. ### 2\. Assemble a balanced and diverse team Second, try to assemble a [balanced and diverse team](https://www.financealliance.io/why-we-need-to-amplify-diverse-voices-in-marketing/). Founders often focus on technical expertise but overlook the importance of a well-rounded team. While technical skills are crucial, don’t neglect other areas. A strong tech team alone won’t guarantee success. Consider hiring individuals who bring diverse perspectives, such as design, marketing, and user experience. Include experts who can provide financial forecasts and appeal to potential investors. Also consider having someone on the team who excels at communication and can handle [investor relations](https://www.financealliance.io/stakeholder-communication-plan/), pitch presentations. ### 3\. Create an effective pitch deck Third, craft an effective pitch deck. A compelling pitch deck is essential for attracting investors. Clearly articulate the problem your startup solves, why this problem is important and how your solution addresses it. Investors want to see a strong fit between the problem and your product or service. Introduce your team members and their expertise. Investors invest in people as much as ideas. Provide realistic financial projections, including revenue, expenses, and growth and be transparent about your assumptions. Many founders overlook the final slides in their pitch decks – they should address the startup’s immediate needs, such as [funding requirements](https://www.financealliance.io/how-to-effectively-fundraise-and-find-investors/) for the next phase. Be specific about what exactly you’re seeking and how you plan to use it, otherwise potential investors might be confused of why you are making the [presentation](https://www.financealliance.io/how-color-impacts-your-finance-presentations/) in the first place – do you need expert advice, their connections, funding or something else entirely. --- [SaaS financing solutions to fund your startup in 2024When it comes to SaaS, it’s all about security. SaaS startups have a trick up their sleeve – they bring in that sweet, consistent revenue early on, unlike their tech counterparts. But there comes a time when you’ve got to grow. So, how do you extend your runway to reach the next level?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceAnthony Witherspoon![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/towfiqu-barbhuiya-jpqyfK7GB4w-unsplash--1-.jpg)](https://www.financealliance.io/saas-financing-solutions-to-fund-your-startup-in-2024/) --- ### 4\. Retain control Next, it’s better to accept less financing initially while retaining more control over your company. Losing control to aggressive [funding terms](https://www.financealliance.io/saas-financing-solutions-to-fund-your-startup-in-2024/) can hinder long-term success. Taking $100,000 for 1% ownership is often wiser than accepting $1,000,000 for 10% if it means maintaining control and organic growth in the future. ### 5\. Consider your location Another important thing when starting your own business is the environment that is suitable for your new company. For example, California is leading the nation and enjoying 39.37% of all funded startups during the period of 6 years, New York is on the second place with 17.56%, Massachusetts is the third with 5.53% while Texas and Florida are on the 4th and 5th spots with 4.57% and 3.40% respectively. Cumulatively those five states represent 70% of all funded startups in the US during the years of 2017-2022 and have their own preferences in terms of the industry (tech/medical, etc.), which is something that startup founders need to consider as well. --- In conclusion, [startup financing](https://www.financealliance.io/how-a-startup-cfo-can-lead-a-new-company-to-success/) often hinges on strategic decisions, team dynamics, and effective communication – all that could be taught in a good acceleration program. By considering these factors, founders can build resilient companies that thrive in the competitive startup landscape. But all of that usually starts with a choice of the right mentor within the acceleration program. Without that initial boost, it’s very hard to be financed by a reputable VC or receive any financing altogether. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### Top 20 Q’s from Fractional CFOs URL: https://www.financealliance.io/top-20-qs-from-fractional-cfos/ Last updated: 2024-11-29T11:31:20.000Z When contemplating a shift from a full-time Chief Financial Officer (CFO) role to a [fractional CFO](https://www.financealliance.io/how-to-become-a-fractional-cfo/) position, there are numerous questions that typically arise. This decision involves substantial changes in work patterns, responsibilities, and financial stability. Addressing these questions can help you gauge whether transitioning to a fractional role aligns with your professional goals and personal life, ensuring you're well-prepared for the challenges and opportunities this change may bring. Here are the top 20 questions you might have when planning the transition to fractional CFO: ### 1\. What is the typical earning potential for a fractional CFO compared to a full-time CFO? Fractional CFOs often command higher hourly rates than full-time salaries due to their specialised skills and the flexibility they offer businesses. While income may initially fluctuate as you establish a client base, successful fractional CFOs can eventually match or exceed their previous full-time earnings, depending on client load and fee structures. ### 2\. How do I build and maintain a stable client base? Building a stable client base involves [leveraging your network](https://www.financealliance.io/11-networking-in-finance-tips/), engaging in targeted marketing, and consistently delivering value to clients. Maintaining relationships through regular communication and exceptional service helps retain clients and encourages referrals, which are crucial for sustainability in a fractional role. ### 3\. What are the risks involved in transitioning to a fractional role? Risks include income variability, the need for continuous client acquisition, and potential client turnover. Managing these risks requires [strategic financial planning](https://www.financealliance.io/financial-planning-in-uncertain-times-advice-from-leading-finance-experts/), effective marketing, and the ability to quickly adapt to different business environments and needs. ### 4\. How do I manage multiple clients without compromising quality? Effective time management and prioritization are essential for managing multiple clients. Utilise technology to streamline processes, maintain strict scheduling, and set clear boundaries. Regular performance reviews with each client ensure that quality standards are met consistently. ### 5\. What kind of legal and insurance considerations should I take into account? It's vital to consider professional liability insurance to protect against potential legal claims. [Legal considerations](https://www.financealliance.io/finance-and-compliance/) include drafting clear contracts that define scope, deliverables, and terms of engagement. Consulting with a legal advisor is recommended to ensure all aspects are covered. --- [How to become a fractional CFO | Finance AllianceMany CFOs have left full-time positions to regain control of their careers and their time. But how did they do it? That’s what you’ll find out in this blog post as we uncover how to become a fractional CFO.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-39.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--3-.png)](https://www.financealliance.io/how-to-become-a-fractional-cfo/) --- ### 6\. How much flexibility can I realistically expect in a fractional CFO role? While the role offers more flexibility than full-time positions, actual flexibility depends on client demands and deadlines. Setting clear expectations with clients regarding availability and response times helps manage these demands while maintaining work-life balance. ### 7\. What are the initial steps to transition from a full-time to a fractional CFO? Begin with a [solid financial plan](https://www.financealliance.io/10-big-picture-financial-planning-steps/) to cover income gaps during the transition. Network extensively, establish a strong online presence, and clearly define your service offerings. Consider starting part-time and gradually increasing your fractional commitments as you gain more clients. ### 8\. How do I market myself effectively to attract the right clients? Identify your [unique skills](https://www.financealliance.io/top-10-cfo-skills/) and industry expertise. Develop a strong value proposition that resonates with your target market. Use professional networking sites, attend [industry conferences](https://www.financealliance.io/all-events/), and participate in relevant forums to raise your profile and demonstrate your expertise. ### 9\. What impact will this change have on my professional development and long-term career trajectory? Transitioning to a [fractional role](https://www.financealliance.io/making-the-move-stepping-into-fractional-success-2/) can broaden your exposure to various industries and business models, enhancing your versatility and marketability. It offers opportunities for significant professional growth through diverse experiences and challenges, potentially leading to higher-level opportunities or consultancy roles. ### 10\. What kind of support network and resources are available for fractional CFOs? Many professional associations and [online communities](https://www.financealliance.io/join-the-fa-slack-community/) exist for fractional executives. These resources offer networking opportunities, industry insights, and peer support. Engaging with these groups can provide valuable advice and support as you navigate your new career path. --- [4 strategies for building a high-value client portfolioThe clients you choose as a fractional Chief Financial Officer (CFO) aren’t just a reflection of your market niche – they define your day-to-day work and strategic focus.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AlliancePeter Turner![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/katie-harp-3DS6EBOsv7U-unsplash-2.jpg)](https://www.financealliance.io/client-portfolio-fractional-cfo/) --- ## Questions: Logistics, strategies, and more These following questions delve deeper into the logistical, strategic, and practical considerations of becoming a fractional CFO. Addressing these areas will help ensure that you're not only prepared for the initial transition but also positioned for sustained success in your new role. ### 11\. How do I price my services? Pricing should reflect your expertise, market demand, and the specific needs of your clients. Consider different pricing models such as hourly rates, retainers, or project-based fees. Research industry standards and adjust your rates based on your experience, the complexity of the services offered, and client feedback. ### 12\. What specific industries or types of businesses will I target? Select industries where you have expertise and contacts, or those undergoing significant growth and requiring strategic financial guidance. Specialising allows you to deepen your expertise and tailor your marketing to attract businesses most likely to benefit from your services. ### 13\. How can I effectively manage client expectations? Start by clearly defining the scope of work, deliverables, timelines, and communication protocols. Maintain transparency throughout the engagement to manage expectations effectively. Regular updates and check-ins will help keep projects aligned with client goals and prevent misunderstandings. ### 14\. What technological tools and software will I need? Invest in reliable [financial management software](https://www.financealliance.io/15-best-fp-a-tools-and-software/), customer relationship management (CRM) tools, and productivity applications. These tools facilitate efficient management of multiple clients and help maintain high-quality standards in your work. ### 15\. How do I handle conflicts of interest between different clients? Develop a clear conflict of interest policy and disclose it during the initial client consultation. Avoid taking on competing clients if possible, and always maintain confidentiality and integrity in managing sensitive information. ### 16\. What legal structure is most appropriate for my fractional CFO business? Consider forming an LLC or corporation to provide liability protection and potential tax advantages. Consulting with a legal or financial advisor can help you choose the best structure based on your specific circumstances and goals. ### 17\. How will I handle my own business accounting and taxes? Initially, you may manage your accounting to maintain close control over finances. However, hiring a professional accountant can ensure compliance, optimise tax strategies, and allow you to focus more on client work. ### 18\. What is my long-term business vision and how does fractional work fit into this? Define your long-term goals, whether it's growing into a larger consultancy, focusing on specific sectors, or maintaining a flexible lifestyle. Align your fractional work with these goals to ensure it serves as a stepping stone towards your ultimate vision. ### 19\. How will I maintain my professional development and stay current in my field? Commit to ongoing education through courses, certifications, and attending industry events. Stay updated with the latest financial regulations, [technologies](https://www.financealliance.io/how-to-optimize-finance-teams/), and trends to keep your skills sharp and relevant. ### 20\. How do I scale my business if demand exceeds my capacity? Scaling may involve subcontracting work to other financial professionals, hiring staff, or partnering with other fractional CFOs. Decide based on your workload, the quality of service you wish to maintain, and your overall business strategy. Understanding these aspects will help ensure that your transition into a fractional CFO role is well-informed and strategically planned, leading to a successful and fulfilling new career phase. *For further information on the common questions regarding planning and making the transition from full-time to fractional CFO, visit* [*Connexion CFO*](https://www.connexioncfo.com/)*.* --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### Banking on a greener future: Where ESG stands in 2024 URL: https://www.financealliance.io/banking-on-a-greener-future-where-esg-stands-in-2024-2/ Last updated: 2024-07-26T09:32:03.000Z The [environmental, social, and governance](https://www.financealliance.io/5-esg-investing-trends/) (ESG) movement has taken root in the financial sector, with banks increasingly recognizing its significance. But how far have we come, and what challenges remain? Here's a look at the current landscape of ESG compliance in banking.👇🏻 --- ### Topics covered: - [Growing momentum](https://www.financealliance.io/p/4a5b9c0a-b267-47fb-9a93-02338e752593/#growing-momentum) - [Challenges and hurdles](https://www.financealliance.io/p/4a5b9c0a-b267-47fb-9a93-02338e752593/#challenges-and-hurdles) - [The road ahead](https://www.financealliance.io/p/4a5b9c0a-b267-47fb-9a93-02338e752593/#the-road-ahead) - [ESG commitments of leading banks](https://www.financealliance.io/p/4a5b9c0a-b267-47fb-9a93-02338e752593/#esg-commitments-of-leading-banks) --- ## **Growing momentum** Some key areas growing momentum include: ### **Net zero commitments** A significant trend is major banks setting ambitious net-zero financed emissions targets. Leaders like UBS and Morgan Stanley are paving the way, aiming for complete decarbonization by 2050. ### **Sustainable finance pledges** Banks are pouring resources into [sustainable finance](https://www.financealliance.io/are-you-prepared-for-esg-and-sustainable-finance/) initiatives. JPMorgan Chase's $2.5 trillion commitment by 2030 and Bank of America's $1 trillion for environmental transition by 2030 are prime examples. ### **Integration with risk management** Leading banks are incorporating ESG factors into their [risk assessment](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) models, recognizing the financial risks associated with climate change and social issues. --- [7 key benefits of ESG investing | Finance AllianceIn this article, we’ll discuss the key benefits of ESG investing and why ESG investing has become such a game-changer in modern finance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/tree-7788512_1280.jpg)](https://www.financealliance.io/7-benefits-of-esg-investing/) --- ## **Challenges and hurdles** Embracing ESG comes with more than a few challenges, so let's look at a few: ### **Data transparency** A significant hurdle is the lack of consistent and comprehensive emissions [data from corporations](https://www.financealliance.io/data-cleaning-techniques/). This makes it difficult for banks to accurately measure their financed emissions and assess progress towards net-zero goals. ### **Fossil fuel dependence** Phasing out exposure to fossil fuels remains a challenge for many banks. While some, like HSBC, are exiting high-risk assets, others continue to finance traditional energy sectors. ### **Standardization and regulation** The lack of standardized [ESG metrics](https://www.financealliance.io/esg-metrics/) and regulations creates confusion and inconsistency in implementation. Clear guidelines from regulatory bodies are needed to ensure a level playing field. ## **The road ahead** The future of ESG [compliance](https://www.financealliance.io/finance-and-compliance/) in banking hinges on overcoming these hurdles. Here are some key areas to watch: ### **Technological innovation** Technological advancements can play a crucial role in improving data collection, analysis, and reporting. This will enable banks to track their ESG performance more effectively. ### **Collaboration between stakeholders** Banks, regulators, and corporates need to work together to establish clear ESG standards and [reporting frameworks](https://www.financealliance.io/the-evolving-role-of-fp-a-in-esg-planning-and-reporting/). This will promote transparency and facilitate progress. ### **Shifting consumer and investor preferences** As stakeholders increasingly prioritize ESG factors, banks that demonstrate strong ESG performance will be better positioned to attract capital and customers. --- [How organizations fuel innovation through ESG and diversityIn this article, I’ll be sharing my experience with ESG and sustainability practices.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2024/07/android-chrome-192x192.png)Finance AllianceCarolina Veira![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/nicholas-doherty-pONBhDyOFoM-unsplash.jpg)](https://www.financealliance.io/how-great-organizations-fuel-innovation-through-esg-and-diversity/) --- ## **ESG commitments of leading banks** The following table provides a snapshot of some major banks' ESG commitments and timelines: ![ESG TRENDS 2024](https://media.licdn.com/dms/image/D4E12AQGVnv6pIHX0XA/article-inline_image-shrink_1500_2232/0/1715012262496?e=1727308800&v=beta&t=abTAxRN-rgJu-NWY7GL-w3xiky9UCfXIvRHl2wzYTFM) While significant progress has been made, ESG compliance in banking remains a work in progress. Overcoming data challenges, reducing fossil fuel dependence, and establishing clear regulations are crucial steps towards a more sustainable financial system. By embracing innovation, collaboration, and a focus on long-term value creation, banks can ensure a greener and more equitable future for all. --- ### About the author Brendan Byrne is the Lead Software Engineer, VP, at Wells Fargo. He is a strategic thinker who aligns cutting-edge technology with business objectives, driving impactful projects that deliver tangible results. Keep up with him on [LinkedIn](https://www.linkedin.com/in/technologyleadershipthroughgrowth/). --- ## Join our free Insider Membership Your gateway to world-class finance resources. Access expert insights, community, courses, templates and more to boost your finance skills and career. No catches, no monthly bills – 100% free, forever. Become a Finance Alliance Insider member for endless insights, connections, and real-life success stories... and we'll bet our bottom dollar that you'll be wanting more. [Become an Insider](https://www.financealliance.io/insider-membership-plan/) ### Recruitment in finance: 4 hiring hacks to attract top FP&A talent URL: https://www.financealliance.io/recruitment-in-finance-4-hiring-hacks/ Last updated: 2025-12-11T09:35:21.000Z Recruiting in finance isn’t easy and I know this because I recently went through the process of building an FP&A team myself. During that experience, I quickly learned that people set parameters based on what *they* think the FP&A team should look like. However, there are no specific rules to hiring for an FP&A team because you’re not looking for a singular skill set. There are *a lot* of different skills that you can glean from people's resumes and backgrounds that might be advantageous to building out your team. So, I wanted to share some insights into the process of [building an FP&A team](https://www.financealliance.io/how-fp-a-teams-calculate-and-reduce-customer-churn/) and designing its structure. I also want to cover the best hiring practices in FP&A to help you find and recruit the best possible talent to build an incredible team. --- ### **Table of contents:** - [Building and leading a successful FP&A team](https://www.financealliance.io/p/f3642011-5785-49b1-9c46-a5fedc41c07f/#building-and-leading-a-successful-fpa-team) - [Diversity within your finance function requires diverse skill sets](https://www.financealliance.io/p/f3642011-5785-49b1-9c46-a5fedc41c07f/#diversity-within-your-finance-function-requires-diverse-skill-sets) - [Finance recruiting: 3 case studies](https://www.financealliance.io/p/f3642011-5785-49b1-9c46-a5fedc41c07f/#finance-recruiting-3-case-studies) - [4 hiring hacks: FP&A and finance recruitment](https://www.financealliance.io/recruitment-in-finance-4-hiring-hacks/#4-hiring-hacks-fpa-and-finance-recruitment) --- ## **Building and leading a successful FP&A team** ![recruitment in finance and FP&A - Steve jobs quote](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/finance-recruitment.png) This quote from Steve Jobs resonates with me because it’s a worthwhile way of thinking about your FP&A function and how to make it successful. For example, you need to have the right people *and* the right software in place to have a successful team. Over the last year, I’ve prioritized building the right team and getting the right software in place. With that, we started to see success grow quickly and it became evident that change happens *constantly*. I view FP&A as a [finance business partnering](https://www.financealliance.io/finance-business-partnering-playbook-2/) function, as well as a strategic finance function. When I joined my current company, I was an FP&A professional and was told I would mainly work on [budgeting and forecasting](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/). However, things changed and soon, I was working with the strategy team helping with due diligence, [M&A](https://www.financealliance.io/m-a-best-practices/), investor relations, procurement, departmental reporting, and more. All of this taught me that you need to be agile enough to know ***when** to hire, ***who** to hire, and ***how** to build that team to support it. To do this properly, you need a ****diverse team** with a ****diverse skillset**. --- ## **Diversity within your finance function requires diverse skill sets** Source: [**Finance Alliance YouTube channel*](https://www.youtube.com/@financealliance7314) When I first started building out a team at my last company, I had it in my head that since I had an FP&A background, I needed to hire someone with an FP&A background too. This seemed like the most logical thing to do at the time. Of course, I soon realized that we were both doing the same thing and it didn’t add value to the company. In retrospect, I should’ve hired someone who was the opposite of me - someone who had a totally different skill set. When you think about recruitment in finance, think about where your function stands today and then consider areas of improvement that you need to focus on. For example, maybe your company wants to focus on M&As. Think about whether that’s something your team *could* own or *should* own. Think about what type of skill sets you need to bring into the company to make that a reality. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/FP-A-career-salary-and-path-2.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## **Finance recruiting: 3 case studies** Now, let’s look at a few members of my own team and assess their different skills and expertise and why I hired them. ### **1\. Giray** ![financial recruitment case study 1 - Giray](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/finance-recruiting-.png) Giray came across my plate, and I thought, here’s someone with a unique skill set that could fit into the broader [finance function](https://www.financealliance.io/building-an-fp-a-function-strategies-for-effective-team-and-organizational-structure/). His experience in healthcare stood out to me since my current company also worked closely with healthcare and patient engagement, hospital systems, and so on. While he had no experience in budgeting or [forecasting](https://www.financealliance.io/rolling-forecast-best-practices/), he knew the players and worked in M&A, [financial modeling](https://www.financealliance.io/10-best-financial-modeling-tools/), and company evaluation. Giray is also a CFA and a CPA, so I found an excellent hire here. ### **2\. John** ![financial recruitment - John](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/recruitment-in-finance--2.png) My next hire was John who was a consultant at Berkshire Research Group. With John’s experience as a consultant on restructuring, it was a completely different ballgame. However, he was still diving through P&Ls, identifying areas of opportunities for those companies, and knew how to optimize them. Having someone who could assess a profit and loss statement like John could really appeal to me as I was carrying out this [finance recruiting](https://www.financealliance.io/finance-talent/) process. John could easily look at a P&L statement and pinpoint exact areas of improvement, he could raise questions that would lead to answers and provide actionable solutions. To me, those types of skills would be an asset to have on my FP&A team. ### **3\. Jessica** ![financial recruitment image 3 - Jessica](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/finance-recruiting-2.png) Jessica started as a bank teller and moved up into the role of Implementation and Conversion Analyst and so on. This was a hire that was just as much about the skills that she brought in as well as her knowledge about software and desire to learn. What you’ll notice about all three hires is that something is missing from their resumes. Not one of them had [FP&A](https://www.financealliance.io/fp-a-exit-opportunities/) in their title and it works because everyone brings a completely different skill set to the table. - When I need someone to carry out [scenario planning](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/) or dynamic modeling, Giray is my guy. - When I need someone to analyze a P&L, compare budget vs actuals, and provide feedback, I turn to John. - When I need someone to work with me on the procurement side of things and expense planning, I rely on Jessica. Everyone brings a unique skill set to the team and each adds value in their own way. --- ## **4 h**iring hacks: FP&A and finance recruitment It’s great to have the best people and a diverse skill set in your finance function, but how can you find people like this? Here are some of the best hiring practices for recruitment in finance: ### **1\. Look through the resumes yourself** When we posted the job ad for Giray’s role, our team of financial recruiters asked me what I was looking for. Of course, I began listing all the desirable skills and experience I’d like to see in the perfect candidate. I emphasized how I’d like to hire someone who knew our software, had experience in FP&A, and could really hit the ground running. So, of course, they went out and began the finance recruiting process, and gave me resumes matching that description. However, Giray’s resume had been dismissed, so I hadn’t seen it because it was rejected in the system. I soon realized that as the hiring manager, I needed to look through *every* resume myself. To me, that was the only way I would know who I was looking for and narrow down the criteria. We had almost 1000 resumes and I looked through every single one of them. It took time, yes, but it was worth it. > *If you're relying on the recruiter to find the talent for you, you're going to miss the right talent.* By looking through the resumes myself, I came across Giray’s and I knew he was the ideal candidate. The same thing happened when I hired John and Jessica. --- ### **2\. Don’t place strict resume parameters** You’ll lose really good talent if you rely on the recruiter to follow specific parameters that may not be right or what you need. If you think hiring is one of the most important things you'll do as a manager, then do the work yourself. Put the time in, look through the resumes, and find the right person for the role. If you’re not willing to do that, you risk hiring the wrong person and having to fix that mistake later. If you’re focusing on [hard skills](https://www.financealliance.io/top-10-fp-a-skills-to-master/) and you think someone must be an expert in a certain software you use at the company, you might want to rethink that approach. We recently switched [FP&A software](https://www.financealliance.io/15-best-fp-a-tools-and-software/) and we’re now implementing something entirely new, and everyone needs to learn how to use it. So, before you set strict parameters, consider whether you’re doing what’s best for the team or not. Here are some of the resume selection best practices that I like to follow when carrying out recruitment in finance or FP&A: ![finance recruiting tips](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/financial-recruiters-.png) ### **3\. Ask the right questions** When I interview someone, I want to know if they can use Excel. Can they assess a P&L statement? Do they know how to construct it? With the financial statements, I find that type of experience and skill set more important than knowing how to use a specific software at this current state of time. It's great if you find someone who happens to check all the boxes. But I strongly advise that you don't consider ‘ticking all the boxes’ as a requirement. Instead, try to find out more about the candidate’s story and why they're interested in the role. You can learn a lot from their answer to a simply question like "why do you want to work for our company?". It’ll tell you whether they’re passionate about the industry, the specific reasons they're interested in joining your team, or if they’re simply looking for a job. ![finance recruiting tips](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/recruiter-finance--2.png) ### **4\. Hire for your future team** ### Also, consider candidate’s career aspirations and find out which path they’re most interested in. For example, maybe you’ll find someone who is an excellent fit for your team with a diverse skill set. Great, but where do they see themselves in 12 months, or a few years down the road? What are their career goals and how can you help them? I always say to anyone who’s working on recruitment in finance or FP&A – hire for your future team, not for today. ![finance recruiting tips](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/recruiter-finance-.png) If you're hiring today and saying, “*I’m Director of FP&A therefore I want to hire an FP&A Analyst who knows the software and we’re just going to continue doing things the same way going forward*.” – I'm sorry to be the one to tell you this, but that mindset won’t set you *or* your team up for success. Instead, think about the team you want to have around you in the future. How can you build a team that adds value to the company? That's how I prefer to approach the hiring process and for me, at least, it works. --- ### **Actionable takeaways:** 🎯 Consider hiring for future skills and team needs rather than just current roles. 🎯 Be willing to look past resumes yourself rather than relying solely on recruiters. 🎯 When interviewing, understand the candidate's full story and motivation beyond just hard skills. --- ### **About the author:** [Patrick Dennehy](https://www.linkedin.com/in/patrickdennehy/) is the Senior Director of Finance at Kyruus Health. Patrick was one of our incredible speakers at the FP&A Summit in Boston and this article has been adapted from his session on the best hiring practices for FP&A teams. --- ## Don't miss our next FP&A Summit - coming to a city near you! We host the best finance events for anyone who wants to learn how to succeed in their role, network with peers, build a trusted network, and hear from top finance leaders and speakers in the industry. Find out more about our events over on our [Events Calendar](https://events.financealliance.io/?%5Fgl=1%2A1rq2d8k%2A%5Fga%2ANTY3MTk0Njc1LjE3MDgwOTA2Nzk.%2A%5Fga%5F2NXFSBEP4N%2AMTcyMTczMDIyNC4yMjQuMC4xNzIxNzMwMjI0LjAuMC4w). [Find out more](https://events.financealliance.io/?%5Fgl=1%2A1rq2d8k%2A%5Fga%2ANTY3MTk0Njc1LjE3MDgwOTA2Nzk.%2A%5Fga%5F2NXFSBEP4N%2AMTcyMTczMDIyNC4yMjQuMC4xNzIxNzMwMjI0LjAuMC4w) ### Transitioning to fractional financial leadership: How to lead in 2-4 days! URL: https://www.financealliance.io/transitioning-to-fractional-financial-leadership-how-to-lead-in-2-4-days/ Last updated: 2025-10-13T12:31:07.000Z For many CFOs accustomed to the rhythms of a full-time corporate role, transitioning to a fractional CFO position can seem daunting. This new model offers a unique set of challenges but also some amazing opportunities for experienced finance professionals looking to diversify their careers and lifestyles. If you're contemplating this shift, understanding how to effectively lead in just 2-4 days a week is *crucial*. The unique role of a fractional leader can significantly impact the people in your team, other business functions, external partners and especially business performance. Here are some tips to guide you on adapting and excelling as a fractional CFO.👇🏼 ## **Understanding the fractional CFO role** As a [fractional CFO](https://www.financealliance.io/how-to-become-a-fractional-cfo/), your job is to provide the same level of strategic guidance and leadership you would in a full-time role, but condensed into a limited number of days. This means you not only have to manage the company's finances but also influence its strategic direction, optimizing team performance, and ensuring robust financial health with *a lot* less time at your disposal. ### **Strategic time management** The key to success as a fractional CFO is exceptional time management. Planning your days meticulously, prioritising high-impact activities, and delegating effectively are [essential skills](https://www.financealliance.io/top-10-cfo-skills/). You’ll need to identify the core functions where your input is most valuable and schedule your involvement in those areas strategically. ### **Remote leadership** Embrace [technology](https://www.financealliance.io/podcast/leverage-technology-finance-transformation/) to maintain a constant presence, even when you're not on-site. Tools such as cloud-based financial software, video conferencing, and secure instant messaging can help you stay connected with your team, oversee operations, and make timely decisions. ### **Strategic oversight and direction** Even in a part-time capacity, a fractional CFO provides the strategic blueprint for the finance team and the wider business, outlining the financial strategy that aligns with the company's overarching goals. The CFO ensures that the finance team is effective, but also providing insights that will inform broader business decisions. --- [CFO interview questions and answersIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/08/CFO-interview-questions-2.jpg)](https://www.financealliance.io/cfo-interview-questions-and-answers/) --- ## **Building and leading your team** One of your primary tasks will be to develop or build a capable, independent [finance team](https://www.financealliance.io/how-to-optimize-finance-teams/) that can handle day-to-day operations in your absence. Your team should be well-aligned with your [strategic vision](https://www.financealliance.io/cfo-mission/) and competent enough to manage regular financial tasks without constant oversight. If you want to become a stronger leader, here's what you need to do: ### **Empower your team** Invest in training and development to enhance your team’s skills and confidence. A well-prepared team is critical, as the'll need to operate independently and handle issues that arise during your non-working days. ### **Establish clear communication channels** Regular updates, clear reporting guidelines, and structured meetings are crucial. Even when you're not physically present, maintaining open lines of communication will help you lead effectively and keep your finger on the pulse of the business. ### **Focus on scalability** Setting up systems and processes that are scalable ensures that as the business grows, the [finance function](https://www.financealliance.io/breaking-down-the-fp-a-function-of-the-cfo-suite/) can adapt without the constant need for overhauls. Automation of routine tasks and the integration of advanced [financial software](https://www.financealliance.io/finance-alliance-tools-of-choice-report-2023/) are critical to enhance efficiency. --- ## **Integrating strategically across the business and beyond** A fractional CFO must integrate [financial strategy](https://www.financealliance.io/financial-accountability/) with broader business objectives efficiently. This requires a deep understanding of various business functions and the ability to communicate financial insights in a way that supports departmental and overall business goals. ### **Cross-functional collaboration** Regularly engage with other department heads to ensure that financial strategies are aligned with operational needs and business aspirations. These interactions can also provide critical insights that shape more informed financial planning. ### **Influence company culture** Even in a part-time capacity, you can influence [company culture](https://www.financealliance.io/how-cfos-drive-company-culture-framework/). Promote values like accountability, transparency, and data-driven decision-making, which are essential for fostering a culture of financial prudence and strategic growth. ### **Building relationships with external stakeholders** Your client’s [external stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) will also need some of your valuable time and attention. Ensuring the key external parties are reassured about the company's financial health and prospects is key to enhancing credibility and trust, both inside and outside the business. ### **Expanding business networks** Leveraging your existing or developing network is important for introducing the business to new opportunities – be it potential investors, advisors, or new markets. These introductions can be invaluable, especially for businesses looking to scale or enter new ventures. --- [How to become a fractional CFO | Finance AllianceMany CFOs have left full-time positions to regain control of their careers and their time. But how did they do it? That’s what you’ll find out in this blog post as we uncover how to become a fractional CFO.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-40.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--3--1.png)](https://www.financealliance.io/how-to-become-a-fractional-cfo/) --- ## **Maximising impact in limited days** To make the most of your days in the office, focus on high-impact activities that drive long-term value. This might include strategic planning sessions, critical [negotiations](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/), major financial reviews, or coaching key team members. ### **Prioritize high-value activities** Identify activities that have the most significant impact on the business’s financial health and growth. Spend your on-site days focusing on these areas, ensuring that your limited time yields maximum benefit. ### **Prepare for each day diligently** Approach each working day with a clear plan. Review upcoming tasks, set specific goals for the day, and prepare for meetings or presentations in advance. This preparation ensures that every hour you spend as a [fractional CFO](https://www.financealliance.io/how-to-become-a-fractional-cfo/) drives the business forward. ## **Navigating challenges and ensuring success** Transitioning to a fractional role involves its set of challenges, from adjusting to a more flexible work schedule to ensuring that your strategic decisions are implemented effectively in your absence. ### **Adapt leadership style** Moving to a fractional role might require adapting your [leadership](https://www.financealliance.io/cfo-leadership-pillars/) style to be more directive and decisive during your working days and more supportive and advisory when off-site. ### **Monitor and adjust** Regularly assess the effectiveness of your new working arrangement. Be open to adjusting your schedule, strategic focus, or communication style based on what is most effective. --- Transitioning from a traditional full-time CFO role to a fractional one offers an exciting opportunity to leverage your expertise in a flexible, impactful manner. By mastering strategic time management, empowering and relying on a strong team, and focusing on high-impact activities, you can lead effectively within the constraints of limited days. This new path not only diversifies your professional experience but also provides the chance to drive significant business transformations across multiple organisations, enriching your career and personal life in the process. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### How to use GPT-4o mini in Excel & Google Sheets URL: https://www.financealliance.io/gpt-4o-mini-in-excel-google-sheets/ Last updated: 2025-11-14T09:34:12.000Z OpenAI has made a significant stride in making AI more accessible with the release of **GPT-4o mini**, their most cost-efficient and intelligent small model yet. This development will potentially revolutionize how finance teams use AI technology. We’re talking about enhanced financial modeling, streamlined workflows, and reimagined budgeting and forecasting. With these tasks streamlined, you can focus on more high-value activities and make data-driven financial decisions with confidence. But let’s back it up and talk more about what GPT-4o mini is, why it’s good news for today’s finance teams, and how you can use it in Excel and Google Sheets. --- ### **Key things to know about GPT-4o mini (at a glance)** - It’s the **cheapest and smallest** version of GPT-4o to date. - Priced at **15 cents per million** input tokens and **60 cents per million** output tokens. - Supports **text and vision** in the API (with video and audio inputs and outputs on the way). - Outperforms other small models on academic benchmarks across both **textual intelligence** and **multimodal reasoning**. - Has knowledge up to **October 2023**. --- ## **What is GPT-4o mini?** [GPT-4o mini](https://openai.com/index/gpt-4o-mini-advancing-cost-efficient-intelligence/) is a compact and more efficient version of the [GPT-4 language model](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/). It's designed to offer powerful AI capabilities while being lighter and faster, making it suitable for devices with limited resources. This version maintains the core strengths of the original GPT-4, like understanding and generating human-like text, but it's optimized for quicker responses and lower computational demands. It's perfect for applications where speed and efficiency are crucial, such as chatbots, virtual assistants, and real-time translation services. > OpenAI’s goal with GPT-4o mini is to “*expand the range of applications built with AI by making intelligence much more affordable*”. ![](https://media.tenor.com/u0jajdhmsY4AAAAC/chatgpt-ai.gif) ## **5 ways to use GPT-4o mini in Excel and Google Sheets** If you're an avid Excel or Google Sheets user, you'll be happy to know that you can use GPT-4o mini as a helpful assistant for your spreadsheets. It’s believed to work well with both Excel and [Google Sheets](https://www.financealliance.io/how-to-use-gemini-ai-with-google-sheets/), so here are a few examples of how this might work in the real world: ### **1\. Financial data analysis** Extracting [key financial metrics](https://www.financealliance.io/infographic-financial-performance-metrics/) is something we all want to do as quickly (and painlessly) as possible. Thankfully, you can do just that with help from GPT-4o mini. All you have to do is feed it specific data points directly within your spreadsheet. It then generates a high-level overview, saving you valuable time previously spent on manual cell-by-cell examination. **How this might work in real-life** 🎬 **Scenario:** Your finance team receives monthly sales data from several departments. It’s *a lot* to get through, potentially taking hours to analyze and comb through for trends. 💡 ****Solution:** Input the raw sales data into Excel or Google Sheets. GPT-4o mini can then analyze your data and highlight key trends like which products are performing best or which regions need attention. ### **2\. Monthly reports** Automating report generation can help take the grunt work out of the [reporting](https://www.financealliance.io/how-to-streamline-investor-reporting-processes-a-comprehensive-guide/) process. To do this in Google Sheets, simply create prompts based on your monthly data and let the AI do the heavy lifting. **How this might work in real-life** 🎬 **Scenario:** You need to prepare a quarterly financial report for the board meeting. You know that some strategies need to be refined and you have to find the time to create and deliver an [impactful presentation](https://www.financealliance.io/how-color-impacts-your-finance-presentations/) – the pressure is on. 💡 ****Solution:** Use GPT-4o mini to help draft a comprehensive report, including summaries, [charts](https://www.financealliance.io/financial-charts-and-graphs/), and insights. All you need to do is provide key points and data in a spreadsheet and feed the right prompts. ### **3\. Smarter budgeting and forecasting** GPT-4o mini can analyze historical data directly within your Excel forecast sheet to [generate sales forecasts](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/). With that side of forecasting and budgeting handled, you can make better data-driven decisions with greater foresight, anticipating sales trends instead of just reacting to them. **How this might work in real-life** 🎬 **Scenario:** Your company needs to forecast the next quarter's revenue based on historical sales data. You’ve done it many times before, but it would be great to streamline the process. 💡 ****Solution:** To leverage GPT-4o for forecasting, simply feed it your historical sales data into a spreadsheet. It can predict future sales trends by analyzing patterns and external factors, helping you to create [accurate forecasts](https://www.financealliance.io/4-tips-for-accurate-sales-forecasts-video/) in less time. ### **4\. Budget allocation** [Allocating the budget across departments](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) can be hard to get right. But you can potentially take a lot of the guesswork out of it by leaning on GPT-4o mini to help you out. This AI tool learns from your past spending patterns and uses that information to suggest a more strategic use of resources. **How this might work in real-life** 🎬 **Scenario:** Your team is [planning the budget](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) for the next fiscal year and needs to allocate funds across multiple departments. It’s not an easy task, but someone has to do it. If you had a way to optimize resource allocation, you could make smarter budgeting decisions. 💡 ****Solution:** Input past expenditure data and future projections into a spreadsheet, GPT-4o can then suggest optimal budget allocations based on historical spending and expected needs. ### **5\. Financial summaries and narratives** Sometimes it can be difficult to [turn numbers into compelling narratives](https://www.financealliance.io/mastering-data-storytelling/). If you’re struggling for the right words, try using GPT-4o mini to help automate the creation of quarterly financial summaries by extracting key points from the data and summarizing them in a readable format. Your summary report can be very valuable for communication and decision-making, but remember - *the better the prompts, the better the results.* **How this might work in real-life** 🎬 **Scenario:** You have to prepare a quarterly financial summary for an upcoming board meeting with a lot of [key stakeholders](https://www.financealliance.io/stakeholder-communication-plan/). Yes, you have the raw financial data ready to go, but you still need to create a coherent summary and narrative. 💡 ****Solution:** Collect the raw data and log it in a spreadsheet. From there, you can use GPT-4o mini for analysis and summary generation. ## **Using GPT-4o mini in Excel and Google Sheets (step-by-step guide)** Using GPT-4o mini with [Excel and Google Sheets](https://www.financealliance.io/google-bard-with-google-sheets-excel/) is definitely possible and can be highly beneficial for you within your role. Here’s a step-by-step guide to help you get started. ![](https://media.tenor.com/otVkYn1FBYkAAAAC/spreadsheet-everybody-gets-a-spreadsheet.gif) ## **GPT-4o mini in Excel** ### **1\. Integration setup** You can use an add-in like OpenAI’s API integrated with Excel through VBA (Visual Basic for Applications) or Power Query. On the other hand, you also have tools like Microsoft Power Automate or third-party connectors designed for integrating APIs with Excel. ### **2\. Steps for VBA Integration** **Step 1:** Open Excel and press Alt + F11 to open the VBA editor. **Step 2:** Insert a new module (Insert > Module). **Step 3:** Write a VBA function to call the GPT-4o mini API. **Step 4:** Use the function within Excel cells. GPT-4o supplied the following code to help with this step: ![GPT-4o in excel 1](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/gpt-4o-in-finance-1.png) --- [How to use GPT-4o in finance (and data analysis)You can now upload Excel, CSV, and other spreadsheet files directly to GPT-4o. No more copying and pasting data into ChatGPT manually, which makes the entire process of analyzing complex data sheets a lot easier and less time-consuming.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/GPT-4o-finance-2.jpg)](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/) --- ## **GPT-4o mini in Google Sheets** ### **1\. Integration setup** You can use Google Apps Script to integrate GPT-4o mini with Google Sheets. ### **2\. Steps for Apps Script integration** **Step 1:** Open Google Sheets and go to Extensions > Apps Script. **Step 2:** Write a function to call the GPT-4o mini API. Again, GPT-4o supplies the following code to help with this step in using GPT-4o mini in Google Sheets: ![GPT-4o mini google sheets](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/gpt-4o-mini-excel-2.png) **Step 3**: Create a custom function in Google Sheets. ![GPT-4o mini Google Sheets](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/gpt-4o-mini-google-sheets-3.png) ### --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ## **GPT-4o mini: Pricing and availability** GPT-4o mini is now available as both a text and vision model through the Assistants API, Chat Completions API, and Batch API. Developers are charged 15 cents for every 1 million input tokens and 60 cents for every 1 million output tokens – that’s around the same as 2,500 pages in a book. ****Availability**: GPT-4o mini has replaced GPT-3.5 for Free, Plus, and Team users in ChatGPT. --- ## **FAQs** #### ****How easily can GPT-4o mini be integrated with existing financial software and tools?** GPT-4o mini can be integrated with various financial systems like Excel, Google Sheets, ERP systems, and other financial software through APIs and custom scripts. It supports seamless integration, allowing finance teams to leverage its capabilities without disrupting their current workflows. #### ****How secure is the data processed by GPT-4o mini?** Data security and privacy are top priorities. GPT-4o mini follows strict data encryption standards and complies with industry regulations like GDPR. It ensures that sensitive financial data is protected during processing and transmission. #### ****How accurate are the insights and predictions generated by GPT-4o mini?** GPT-4o mini is trained on vast amounts of data and uses advanced algorithms to provide highly accurate insights and predictions. However, it's essential to validate its outputs with expert knowledge and historical data to ensure reliability. --- ### Download our AI in Finance eBook Artificial Intelligence (AI) is reshaping the finance industry and empowering finance teams to make smarter, data-driven decisions like never before. But how can you incorporate AI into *your* financial workflow? Welcome to the **AI in Finance** eBook, your trusted guide to merging AI’s vast potential with everyday finance operations such as forecasting, budgeting, analysis, and more. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/08/FA_AI_In_Finance_Playbook_CTA.jpg) ](https://www.financealliance.io/ai-in-finance-ebook/) ### Chief Finance Officer vs. Financial Controller: What’s the difference? URL: https://www.financealliance.io/cfo-vs-controller/ Last updated: 2026-03-11T11:42:01.000Z Are you curious about the distinction between a CFO vs Controller? These titles are often thrown around in the business and finance world, but understanding *exactly* what each role does can be challenging. In this article, we're going to try to clear up the confusion. We'll look at how CFOs and Controllers contribute to a company's financial health, what their day-to-day responsibilities look like, and why both roles are crucial for businesses of all sizes. Whether you're a business owner, a finance professional, or just curious about corporate structures, understanding these roles can give you valuable insights into how companies manage their finances. So, let's dive in and explore the difference between a controller and a CFO... --- ### Table of contents: - [Controller vs CFO: 7 key differences](https://www.financealliance.io/p/3043b4ab-c212-4cc0-b07b-d668b7aeb221/#controller-vs-cfo-7-key-differences) - [Role and responsibilities of a CFO](https://www.financealliance.io/p/3043b4ab-c212-4cc0-b07b-d668b7aeb221/#role-and-responsibilities-of-a-cfo) - [Role and responsibilities of a Financial Controller](https://www.financealliance.io/p/3043b4ab-c212-4cc0-b07b-d668b7aeb221/#role-and-responsibilities-of-a-financial-controller) --- ## **Controller vs CFO: 7 key differences** While CFOs and Controllers play crucial roles in a company's [financial management](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/), they have distinct responsibilities and focuses. Let's break some of these down: ### **1\. Scope of vision** 💸 **CFO**: Think of the CFO as the financial pilot, soaring high above the business landscape. They take a broad, [strategic view of the company's finances](https://www.financealliance.io/10-big-picture-financial-planning-steps/). ⚖️ **Controller**: That makes the Controller more like a skilled navigator, expertly guiding the financial ship through day-to-day operations. ### **2\. Focus areas** 💸 **CFO**: Finance in its broader sense - [financial planning](https://www.financealliance.io/people-planning-strategically-build-your-finance-dream-team/), capital markets, and investments. ⚖️ **Controller**: Accounting specifics - ensuring [compliance](https://www.financealliance.io/finance-and-compliance/) with GAAP, managing tax regulations, and maintaining precise financial records. ### **3\. Strategic vs. tactical** 💸 **CFO**: Develops long-term financial strategies and advises on major business decisions. ⚖️ **Controller**: Executes financial plans and ensures smooth daily [financial operations](https://www.financealliance.io/tag/financial-operations/). --- [17 finance business processesEffective and streamlined finance business processes keep companies running smoothly. They’re vital for sound financial management, which is essential for a company’s success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/industries-4327631_1280.jpg)](https://www.financealliance.io/17-finance-business-processes/) --- ### **4\. External vs. internal** 💸 **CFO**: Often the face of the company to external stakeholders, handling investor relations and major partnerships. ⚖️ **Controller**: Primarily focused on internal processes, collaborating with other departments to implement financial policies. ### **5\. Future vs. present** 💸 **CFO**: Forward-looking, analyzing market trends, and [forecasting financial scenarios](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/). ⚖️ **Controller**: Present-focused, ensuring current financial data is accurate and up-to-date. ### **6\. Decision-making level** 💸 **CFO**: Makes high-level financial decisions that impact the entire organization. ⚖️ **Controller**: Makes operational decisions within the finance department and provides data for higher-level decision-making. ### **7\. Required skills** 💸 **CFO**: Needs a mix of financial acumen, strategic thinking, and [leadership skills](https://www.financealliance.io/cfo-leadership-pillars/). ⚖️ **Controller**: Requires deep technical accounting knowledge and attention to detail. Understanding the difference between a CFO and Controller helps clarify why both roles are essential in a well-functioning finance department. While there may be some overlap, each position brings unique value to an organization's financial health and growth. Let’s dive a little further into each role… ![CFO vs controllers](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/CFOs-vs.-controllers-article-meta--5-.png) ## **Role and responsibilities of a CFO** When you think of a CFO, you might picture someone buried in spreadsheets all day. But the reality is *far* more dynamic. The Chief Financial Officer is like the financial architect of a company, designing and overseeing the big picture of the organization's fiscal health. So, what exactly does a CFO do? Let's break it down: ### **Strategic financial leadership** At its core, the CFO's role is about big-picture thinking. They're not just number crunchers – they're strategic visionaries who use financial insights to guide the entire organization. A CFO spends a good chunk of their time advising the CEO and board of directors on financial matters, developing long-term financial strategies, and identifying opportunities for [revenue growth](https://www.financealliance.io/saas-finance-strategies/) and cost optimization. CFOs are always thinking about how to move the company forward financially. ### **Financial planning and analysis** CFOs spend a lot of time looking ahead. They're constantly analyzing market trends, predicting potential scenarios, and planning for the company's financial future. This involves: - Creating and analyzing [financial models](https://www.financealliance.io/10-best-financial-modeling-tools/) - Conducting scenario planning for various economic conditions - Evaluating the financial impact of major business decisions ### **Capital management** Managing a company's money is no small task. CFOs oversee the [capital](https://www.financealliance.io/multiple-on-invested-capital-moic/) structure, balancing debt and equity to ensure the company has the funds it needs to operate and grow. They're also often involved in big financial moves like [mergers](https://www.financealliance.io/risks-of-mergers-and-acquisitions/), acquisitions, or taking a company public. Alongside all this, they’re also managing the company’s relationships with investors and financial institutions. ### **Risk management and compliance** Today, managing risk has never been more complex, nor more crucial, and CFOs play a key role in protecting the company from financial risks. They're responsible for: - Ensuring compliance with financial regulations - Overseeing internal controls to prevent fraud - Managing financial aspects of [cybersecurity](https://www.financealliance.io/cfo-cybersecurity/) and other business risks --- [5 supply chain risk mitigation strategies to dodge disasterHow can you mitigate supply chain risks as effectively as possible? Find out in this article, where we explore five key supply chain risk mitigation strategies to help you steer your company toward financial stability and resilience.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/06/supply-chain-risk-mitigation-strategies-2.png)](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) --- ### **Team leadership** A great CFO doesn't work alone. They lead the entire finance department, setting the tone for the team's culture and ensuring everyone works together effectively. This leadership extends beyond just the finance department, as CFOs often collaborate with other departments to [drive financial awareness](https://www.financealliance.io/financial-accountability/) across the entire organization. ### **External relations** When it comes to financial matters, CFOs often serve as the face of the company's financial health to the outside world. They might find themselves: - Presenting financial results to investors and analysts - [Negotiating](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/) with banks and other financial partners - Representing the company in financial matters with the media and public ### **Technology and innovation** CFOs are increasingly involved today in leveraging technology to improve financial operations. This could mean implementing new financial software, driving automation initiatives, or exploring cutting-edge fintech solutions to give their company a competitive edge. Remember, the exact responsibilities of a CFO can vary depending on the company's size, industry, and specific needs. But one thing's for sure – it's a dynamic, challenging role that requires a unique blend of financial expertise, strategic thinking, and leadership skills. --- [CFO vs CPA: Does a CFO need a CPA?There’s no rulebook saying you must be a CPA to excel as a CFO. In this blog post, we clear up the confusion between CFOs and CPAs and explore whether you need a CPA to become a successful CFO (spoiler - you don’t!).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/05/cfo-vs-cpa-image.jpg)](https://www.financealliance.io/cfo-vs-cpa/) --- ## **Role and responsibilities of a Financial Controller** While the CFO might be charting the course, the Financial Controller is making sure the ship stays on course day-to-day. Think of them as the guardian of a company's financial present, ensuring everything adds up (quite literally). So, what does a financial controller actually do? Let's dive in: ### **Master of accounting** At their core, Controllers are accounting experts. They're the go-to people for all things related to the company's financial records. This means overseeing the entire accounting department, making sure every number is accurate and every financial i is dotted and t is crossed. ### **Financial reporting** Controllers are the conductors of [financial reporting](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/), responsible for: - Preparing regular financial statements (monthly, quarterly, and annual) - Ensuring compliance with Generally Accepted Accounting Principles (GAAP) - Managing external audits and liaising with auditors ### **Internal control** A key part of the Controller's job is to keep the company's financial house in order. They develop and implement internal control systems that keep the company's finances secure and running smoothly, such as: - Developing and implementing internal control systems - Monitoring for potential accounting errors or fraud - Ensuring compliance with financial regulations and tax laws ### **Operational efficiency** Beyond just keeping the books, Controllers are often tasked with finding ways to make financial operations more efficient. This might involve streamlining processes, implementing new accounting software, or identifying areas where the company can save money. ### **Financial analysis and support** While CFOs focus on the big picture, controllers dive into the details like: - Conducting variance analysis - Providing financial insights to support management decisions - Assisting with budgeting and forecasting processes ### **Team leader and mentor** Controllers typically lead the accounting team. This means they're not just number crunchers – they're also mentors and managers, responsible for ret, training, and guiding their staff. ### **Compliance and risk management** Controllers play a crucial role in keeping the company on the right side of regulations: - Ensuring timely and accurate tax filings - Managing financial aspects of legal compliance - Overseeing proper documentation for all financial transactions ### **Bridge between departments** While primarily focused on accounting, Controllers often serve as a link between finance and other departments. They might collaborate with various teams to gather financial data, explain financial concepts to non-finance colleagues, or [support the CFO](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/) in company-wide financial initiatives. Remember, the exact duties of a Controller can vary depending on the size and structure of the company. In smaller organizations, they might take on some CFO-like responsibilities, while in larger firms, they might specialize more deeply in specific areas of accounting and financial management. Regardless of the specifics, the Controller plays a crucial role in maintaining the financial health and integrity of any organization. ## **Conclusion** So, there you have it - a clear picture of how CFOs and Controllers shape a company's financial landscape. While both roles are crucial, they each bring unique skills and perspectives. Understanding these roles isn't just about knowing who does what. It's about appreciating how different financial professionals work together to keep a business financially healthy and successful. Whether you're building a finance team, considering a career in finance, or just want to understand your company better, recognizing the distinct value of a Chief Financial Officer vs Controller is key. In the end, it's the synergy between these roles that helps drive a company's financial success. --- ## **FAQs** ### **Can a company have a Controller without a CFO?** Yes, especially in smaller companies. In such cases, the Controller might report directly to the CEO and take on some CFO-like responsibilities. As companies grow, they often add a CFO position to focus more on strategic financial planning. ### **What qualifications are typically required for CFO and Controller positions?** Controllers usually have a strong accounting background, often with CPA certification. CFOs may come from various backgrounds, including accounting, finance, or business management. Though it’s not always required, many CFOs hold MBA degrees or other advanced financial certifications. ### **How do CFOs and Controllers work together in larger organizations?** In companies with both roles, the Controller typically reports to the CFO. The Controller focuses on managing day-to-day accounting operations and producing accurate financial reports. The CFO then uses this information to make strategic financial decisions and guide the company's direction. ### **Is it common for Controllers to be promoted to CFO positions?** Yes, it's not uncommon for Controllers to move into CFO roles, especially if they develop strong strategic and leadership skills. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/1-1.png) ](https://www.financealliance.io/pro-membership/) ### The 7 key elements of the McKinsey 7S Model explained URL: https://www.financealliance.io/mckinsey-7s-model/ Last updated: 2025-04-07T16:36:50.000Z If you're a CFO or FP&A professional, you'll be required to understand how your organization is positioned to achieve its strategic goals and what elements influence its ability to implement change successfully. **McKinsey 7S Model** is one of the most *powerful* tools to assess the organization’s effectiveness in achieving its strategic goals through the interactions of seven key elements – Structure, Strategy, Skills, System, Shared Values, Style, and Staff. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/mckinsey-7s-model.webp) [**Image source: Corporate Finance Institute*](https://corporatefinanceinstitute.com/resources/management/mckinsey-7s-model/) The focus of the McKinsey 7s Model lies in the interconnection of the elements that are categorized by “Soft Ss” and “Hard Ss”. “Hard Ss” refers to Structure, Strategy, and system, whereas the remaining elements, which are Skills, style, stuff, and shared values are considered as “Soft Ss.”. Let me break it down for you... ### **1\. Structure** Structure is the way in which a company is organized. In other words, how [departments and teams](https://www.financealliance.io/financial-accountability/) are structured, including who reports to whom, and so on. ### **2\. Strategy** Strategy refers to the organization's plan for building a sustainable competitive advantage over its competitors, reinforced by the company’s [mission and values](https://www.financealliance.io/cfo-mission/). ### **3\. Systems** Systems refers to the business and technical infrastructure of the company that establishes workflows and the chain of decision-making. --- [Making the move: Stepping into fractional successA fractional CFO isn’t limited by working with one company at a time. You’ll usually find that most people in this position work with a variety of companies on a part-time basis, offering deep financial expertise without the overhead cost of a full-time executive.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AlliancePeter Turner![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/07/ladder-of-success-6585235_1280-1.png)](https://www.financealliance.io/making-the-move-stepping-into-fractional-success-2/) --- ### **4\. Skills** [Skills](https://www.financealliance.io/top-10-cfo-skills/) form the capabilities and competencies of the organization's employees that enables achieve its strategic objectives. ### **5\. Style** The attitude of senior employees in a company establishes a code of conduct through their ways of interactions and symbolic decision-making, which forms the [style of leadership](https://www.financealliance.io/cfo-leadership-pillars/) adopted. ### **6\. Staff** Staff involves the employees and their general capabilities, and all human resources related to company decisions, such as training, [recruiting](https://www.financealliance.io/finance-talent/), and rewards systems. ### **7\. Shared values** These are the core values of the organization and reflect its general work ethic. It plays an important role in aligning all key elements to maintain an effective organizational design. --- ## Download free financial templates & frameworks Access the latest insights from renowned finance experts (from companies like Adobe, Salesforce, Burberry, Virgin Galactic, and more), battle-tested templates & frameworks, as well as a network of peers to bounce ideas off and help overcome your challenges. Become a [**Finance Alliance Insider member**](https://www.financealliance.io/insider-membership-plan/) for endless insights, connections, and real-life success stories... and we'll bet our bottom dollar that you'll be wanting more. [Sign up today](https://www.financealliance.io/insider-membership-plan/) ### The 5 pillars to build your next-gen FP&A team URL: https://www.financealliance.io/the-5-pillars-to-build-your-next-gen-fp-a/ Last updated: 2025-04-10T07:49:16.000Z The five pillars of **Mindset, Culture, Skillset, Digitalization, and Capacity** collectively form the foundation of the next generation of financial planning and analysis (FP&A). Each one effectively drives organizations towards innovative, ethical, and efficient financial strategies through a transformative combination of forward-thinking attitudes, collaborative environments, technical skills, technological integration, and optimized operational capabilities. Below, I get into each pillar in more detail to help you build your next-gen FP&A successfully. ## 1\. Mindset *Pioneering FP&A's future* Transform from a cost center to a value creator by embracing curiosity and [fostering business relationships](https://www.financealliance.io/6-steps-to-tackle-your-first-project-finance-business-partner/). **Shift from cost-center to profit-center:** Value creation is key 🔑 **Curiosity behind numbers:** Ask 'So what?' and 'What if?' 🤔 **Build business relationships:** Beyond the numbers 🤝 And don’t forget to foster face-to-face [stakeholder interactions](https://www.financealliance.io/stakeholder-communication-plan/) for impactful communication 🗣 ### Mindset key facts - 80% of FP&A professionals say a **proactive mindset** leads to better forecasting. - Teams with a forward-looking mindset are 30% more likely to **spot trends**. - Regular stakeholder meetings can **reduce misunderstanding** by 50%. - Value creation mindset increases **collaboration** by 40%. ## 2\. Skillset *Empower with knowledge and tools* ![Critical analysis, decision support and tech-savvy](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/Screenshot-2024-07-03-at-10.13.18.png) Tackle critical problem-solving and strategic thinking skills to [transform insights into action](https://www.financealliance.io/mastering-data-storytelling/). **Critical analysis:** Dive deep into data for compelling business insights. 📊 **Decision support:** Equip teams to drive strategic actions and outcomes. 🎯 **Tech-savvy:** Embrace technology for streamlined, effective analysis. 🤖 **Build relationships:** Cultivate trust and influence through [stakeholder collaboration](https://www.financealliance.io/stakeholder-communication-plan/). 🤝 **Business acumen:** Understand all the internal and external factors impacting your business. 🏭 **Storytelling:** Ensure that you provide a [story that inspires](https://www.financealliance.io/storytelling-with-data-visualization-playbook/) for action. ### Skillset key insights - Diverse skills lead to **comprehensive** and **insightful analysis**. - Continuous learning is crucial in adapting to **evolving market demands**. - Technological proficiency **enhances efficiency** and **predictive capabilities**. - Effective communication and collaboration **drive stakeholder trust** and **influence**. --- [CFO interview questions and answersIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/08/CFO-interview-questions-2.jpg)](https://www.financealliance.io/cfo-interview-questions-and-answers/) --- ## 3\. Digitalization *Embrace technological evolution* Build bridges across departments to foster a holistic, united approach to business strategy and execution. - 🔄 Automate for efficiency and strategic value. - ☁ Embrace **cloud solutions** for flexible, fast decision-making. - 🤖 Utilize **AI** for predictive analytics and advanced insights. - 📈 Create **real-time, customized reports** for stakeholder needs. ### Digitalization strategies and actions 1. Adopt **cloud computing** for flexible, efficient financial operations. 2. Utilize **AI and ML** for enhanced predictive analytics and decision support. 3. Invest in **customizable** [**digital reporting tools**](https://www.financealliance.io/15-best-fp-a-tools-and-software/)for better stakeholder communication. 4. Stay updated with **emerging technologies** to maintain a competitive edge. ## 4\. Capacity *Optimize for excellence* Revolutionize your [FP&A function](https://www.financealliance.io/building-an-fp-a-function-strategies-for-effective-team-and-organizational-structure/) by focusing on high-value tasks and [strategic allocation of resources](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). ![Capacity matrix](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/07/Screenshot-2024-07-03-at-10.22.39.png) **Boost your team's capacity**: Efficient capacity management leads to **40% increased** time for analysis and strategic activities. ## 5\. Culture *The heartbeat of high-performance* One of the key pillars that enables your FP&A team to **succeed** is the implementation of the right culture in the organization. There are three types of cultures that should be considered: **🛡 Ethics and compliance**: Build trust and integrity. 🤝 **Collaborative environment:** Cross-functional teamwork is key. 📚 **Diversity:** Different perspectives drive innovation. 🌱 Nurture a **growth mindset** to foster continuous improvement. --- [3 strategies to slash costs with corporate treasuryAn effective corporate treasury department is much more than cutting checks and keeping the books tidy. When managed properly, it becomes a strategic function that optimizes cash flow, mitigates risks, and ultimately, saves your company a fortune.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/FA_Framework_Tiles_6_treasury_operations.jpg)](https://www.financealliance.io/corporate-treasury-guide-plus-3-strategies-to-save-your-company-a-fortune/) --- ## Recap Embrace the 5 pillars of Mindset, Skillset, Digitalization, Capacity, and Culture to **revolutionize your FP&A function**. Propel your organization into a future of informed decisions, strategic growth, and financial excellence. - **Mindset shift**: From cost-center to value creator, fostering curiosity and strategic questioning. - **Skillset enhancement**: Cultivating both analytical and soft skills for impactful business partnerships. - **Digitalization**: Leveraging modern technology for agile, insightful finance functions. - **Capacity optimization**: Streamlining processes to focus on high-value, strategic activities. - **Culture**: Embedding ethics, collaboration, and diversity for a resilient, innovative team. --- ## **Drive your career growth with FP&A Certified** Take your career to the next level with [FP&A Certified: Core](https://certified.thealliance.io/course/fpa-certified-core). Learn to forecast, budget and turn complex data into insights that drive profitable business growth. Enrol today and... - Gain an all-in-one, in-depth understanding of financial planning and analysis. - Get practical tools for real-world applications that you can put into action immediately. - Build effective FP&A processes, providing a solid foundation for effective financial planning, insightful analysis, and data-driven decision-making. [Get certified](https://certified.thealliance.io/course/fpa-certified-core) ### How to boost the bottom line with Balanced Scorecards (BSC) URL: https://www.financealliance.io/how-to-boost-the-bottom-line-with-balanced-scorecards-bsc/ Last updated: 2025-04-07T16:37:01.000Z As a CFO or FP&A professional, it’s important to implement a strategy mapping tool to see where value is added within your organization, and to help develop strategic initiatives and strategic objectives. This can be done by assigning tasks and projects to different areas of the company to boost [financial and operational](https://www.financealliance.io/operational-finance/) efficiencies, thus improving the company's top and bottom line. One of the best tools to do that is with **Balanced Scorecards (BSC).** ## **What are Balanced Scorecards?** Balanced Scorecards (BSC)are a strategic [management performance metric](https://www.financealliance.io/32-cfo-kpis/) that helps organizations translate strategy into operational objectives that drive both behaviour and performance to deliver superior external outcomes. Also, it measures past performance data and provides organizations with feedback on how to make better decisions in the future. There are many benefits of using a balanced scorecard. For instance, the BSC allows businesses to pool together information and data into a single report rather than having to deal with multiple tools. This allows management to save time, money, and resources when they need to execute reviews to improve procedures and operations. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/FP-A-career-salary-and-path-2.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## **The Balanced Scorecards: 4 perspectives** In a Balanced Scorecards (BSC) model, the information is collected and analysed from four aspects of a business: ### **1\. Financial perspective** To satisfy our [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/), what financial objectives must be accomplished? **Examples**: - Increase revenue through finding new sources of revenue. - Improve profitability from existing customers - Improve cost efficiencies - Increase assets utilization - Improve EBITDA - Reduce DSO ### **2\. Customer perspective** To achieve our financial objectives, how the entity provides value to its customers determines the level of customer satisfaction with the company’s products or services. Customer satisfaction is an indicator of the company’s success. How well a company treats its customers can obviously affect its profitability. **Examples**: - Customer satisfaction scores - Customer retention rate - NPS (Net Promoter Score) - Increase number of new customers ### **3\. Internal business processes perspective** To satisfy our customers, and shareholders, which internal business processes must we excel? The scorecard helps [evaluate the company’s](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/) products or services and determine whether they conform to the standards that customers desire or not. **Examples:** - Reduce machine downtime - [Improve forecast accuracy](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) - Reduce [month end closing](https://www.financealliance.io/month-end-close-checklist/) time - Reduce customer returns ### **4\. Organizational capacity / Learning & growth perspective** To achieve our objectives, how must our organization learn and innovate? People are required to demonstrate high performance in terms of leadership, the entity’s culture, application of knowledge, and skill sets. Proper infrastructure is also required for the organization to deliver according to the expectations of management. **Examples**: - Number of key hires - Keep smart (learning) - Employee engagement survey - Number of new hire failures in 90 days - Continuing education and training - Number of quality meetings per week (sales leading indicator) - Glassdoor recommendations - The use of the latest technology to automate activities and ensure a smooth flow of activities, etc. --- ### Join Finance Alliance Pro Membership Our [Pro membership](https://www.financealliance.io/pro-membership/) offers a unified source of trustworthy value for finance professionals to gain new knowledge. Access tools that help you do your daily work, and meet and learn from experts in the industry. This membership plan helps you to gain access to the most recent resources, and a supportive community of peers who share your passion for achievement. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/1-1.png) ](https://www.financealliance.io/pro-membership/) ### Making the move: Stepping into fractional success URL: https://www.financealliance.io/making-the-move-stepping-into-fractional-success-2/ Last updated: 2024-11-29T11:32:13.000Z The journey from a full-time Chief Financial Officer (CFO) to a fractional, portfolio-based career can be as exhilarating as it is challenging. After all, it’s not just a change in job title or working hours. Those who've made the switch know that it’s a profound shift in work style, professional identity, and personal life balance. Whether you're considering the transition, in the midst of it, or still adjusting to this new professional paradigm, understanding both the hurdles and opportunities can significantly help smoothen your path. Keep reading as we reveal the unique opportunities that come with the switch from full-time to [fractional CFO](https://www.connexioncfo.com/services), common pitfalls to avoid, and our best tips to ensure the transition is a success. --- ### Table of contents: - [Fractional CFO role definition](https://www.financealliance.io/p/7e808f1e-be5c-46d3-9414-4cb358071049/#understanding-the-fractional-cfo-role) - [Best opportunities](https://www.financealliance.io/p/7e808f1e-be5c-46d3-9414-4cb358071049/#opportunities-of-becoming-a-fractional-cfo) - [Common challenges](https://www.financealliance.io/p/7e808f1e-be5c-46d3-9414-4cb358071049/#challenges-of-becoming-a-fractional-cfo) - [Tips for success](https://www.financealliance.io/p/7e808f1e-be5c-46d3-9414-4cb358071049/#top-tips-for-making-the-transition-to-fractional-a-success) --- ## Understanding the fractional CFO role A [fractional CFO](https://www.financealliance.io/how-to-become-a-fractional-cfo/) isn't limited by working with one company at a time. You'll usually find that most people in this position work with a variety of companies on a part-time basis, offering deep financial expertise *without* the overhead cost of a full-time executive. To succeed in this role, you'll not only need top-notch financial acumen, but you'll also have to be very flexible, adaptable, and have excellent[ communication skills](https://www.financealliance.io/top-10-cfo-skills/). These are *all* important because you'll likely have to juggle various company cultures, financial statuses, and industry challenges at the same time. --- [How to become a fractional CFO | Finance AllianceMany CFOs have left full-time positions to regain control of their careers and their time. But how did they do it? That’s what you’ll find out in this blog post as we uncover how to become a fractional CFO.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/icon/android-chrome-192x192-41.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/thumbnail/Copy-of-FA_Website_Article_Images_Doodles--3--2.png)](https://www.financealliance.io/how-to-become-a-fractional-cfo/) --- ## Opportunities of becoming a fractional CFO The fractional CFO model offers flexibility, diverse industry exposure, and accelerated career development by working with multiple clients and leveraging their expertise across a wider range of challenges. Still not convinced? Here are some of the best parts of becoming a fractional CFO: ### Diverse experiences and learning opportunities As a fractional CFO, you're exposed to a range of industries and business models, which can help widen your skill set and enhance your adaptability. Each client brings a unique set of challenges and learning opportunities, making your workdays diverse and intellectually stimulating. ### Increased flexibility and work-life balance One of the most appealing aspects of fractional work is the potential for a more flexible schedule. You can often set your hours and manage your client load, which allows for a better balance between professional commitments and personal life – something that’s especially valuable if you’re looking to spend more time with family or pursue other interests. ### Financial incentives and growth Although building a client base can take time, successful fractional CFOs often command a high hourly rate due to their expertise and the high value they deliver. Moreover, as you grow your portfolio, you have the potential to earn more than in a traditional full-time role, depending on how you structure your engagements. --- ## Challenges of becoming a fractional CFO While fractional CFO work offers exciting opportunities, it also comes with its own set of challenges. Here's a breakdown of some key hurdles fractional CFOs might face: ### Building a client portfolio Perhaps the biggest challenge in transitioning to a fractional CFO is [establishing a robust client portfolio](https://www.financealliance.io/client-portfolio-fractional-cfo/). This requires not just [networking](https://www.financealliance.io/11-networking-in-finance-tips/) and marketing your skills, but also demonstrating a clear value proposition to potential clients. How will your expertise translate into better financial health and growth for their businesses? ### Financial runway Transitioning to fractional work often means a period of reduced income as you build your client base. My advice is to work on building a financial buffer to help sustain yourself during this period. Planning your [financial runway](https://www.financealliance.io/forecasting-growth-to-extend-runway-start-up-success-story/) involves evaluating your savings, potential earnings, and the time it might take to secure enough clients to support your financial needs. ### Time management Managing multiple clients means toggling between different financial systems, expectations, and priorities. The ability to effectively manage your time and maintain high standards across all engagements is vital. It’s not just about working hard but working smart – leveraging [tools and techniques](https://www.financealliance.io/10-best-financial-modeling-tools/) to keep you on top of your game. ### Emotional and professional shifts Moving away from a full-time role, particularly one that provided a sense of identity and security, can be very difficult. The uncertainty of the first months and building new relationships can also feel daunting compared to the familiarity of a single company or team. Transitioning to a fractional CFO role is a bold step towards a more flexible and potentially rewarding career path. It requires not only a shift in how you work, but also in how you view your professional and personal life. While the journey may present challenges, especially in the initial stages, the diverse experiences and the impact you can make across multiple organizations can be profoundly fulfilling. Remember, success in this venture comes from preparation, perseverance, and the continuous pursuit of growth – both for yourself and for the businesses you advise. --- [4 strategies for building a high-value client portfolioThe clients you choose as a fractional Chief Financial Officer (CFO) aren’t just a reflection of your market niche – they define your day-to-day work and strategic focus.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AlliancePeter Turner![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/katie-harp-3DS6EBOsv7U-unsplash-2.jpg)](https://www.financealliance.io/client-portfolio-fractional-cfo/) --- ## Top tips for making the transition to fractional a success Conquering the challenges of the fractional CFO role requires a strategic approach and a commitment to excellence. By honing your time management, communication, and client relationship-building skills, you can navigate the ever-changing demands of multiple clients. I've worked closely with fractional CFOs for a *very* long time, and I've learned a thing or two about what it takes to succeed in this role. So, here are some of my best tips for anyone who wants to thrive in this career path: ### 1\. Establish a strong network Before you make the jump, begin cultivating a broad network. Connect with former colleagues, industry peers, and professional groups. These connections can be crucial in gaining referrals and introductions to potential clients. ### 2\. Clearly define your offering What makes you different from a full-time CFO or another fractional CFO? Define your niche based on your skills, experiences, and industry knowledge. Are you an expert in turnaround situations, rapid growth scenarios, or perhaps startups? Knowing your unique selling points and communicating them clearly can help attract the right clients. ### 3\. Invest in continuous learning Stay abreast of industry trends, software updates, and [financial regulations](https://www.financealliance.io/finance-and-compliance/). The more current your knowledge, the more value you can offer to your clients. Continuous learning also includes adapting new technologies that can help you manage multiple clients more efficiently. ### 4\. Set realistic goals and expectations Be realistic about how quickly you can build your client base and achieve your desired income level. Set short-term and long-term goals and adjust them as you learn more about the demands and rewards of your new role. ### 5\. Seek support [Join groups or forums](https://www.financealliance.io/community/) with other fractional CFOs. Learning from their experiences can provide insights and strategies for managing the challenges of the role. Plus, it’s always helpful to have a support network that understands the unique aspects of your work. --- ### Network with Fractional CFOs inside our Slack community Looking to connect with experienced fractional CFOs and elevate your financial expertise? Look no further! Our *free* [**Finance Alliance Slack community**](https://www.financealliance.io/community/) is a thriving hub for finance professionals of all levels, offering a dedicated channel for you to network directly with fractional CFOs. Once you've signed up, simply head over to the **#FractionalCFOs** channel - your one-stop shop for connecting and interacting with fractional CFOs! [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### "Members are supportive and eager to share their knowledge" - Saurabh Jain URL: https://www.financealliance.io/saurabh-jain-case-study/ Last updated: 2024-07-01T08:45:33.000Z We're thrilled to share a testimonial from [Saurabh Jain](https://www.linkedin.com/in/ca-saurabh-jain-136087a6/), a valued member of the [Finance Alliance Slack community](https://www.financealliance.io/community/) and Director of Finance at Rocketium. Our free online community is designed to empower finance professionals from all walks of life. We connect individuals across the world, providing a platform to share best practices, access exclusive resources, and build a strong network of peers. Saurabh has been an active member, consistently engaging in discussions and offering valuable insights. Here's what he has to say about his experience as a member of our community: ### 1\. What was your motivation for joining our community? My motivation for joining the Finance Alliance community was driven by a desire to connect with like-minded finance professionals, share insights, and gain exposure to diverse perspectives within the finance industry. I wanted to be [part of a dynamic network](https://www.financealliance.io/the-power-of-networking-case-study/) that fosters learning, growth, and collaboration. ### 2\. What have you enjoyed most since joining? Since joining the community, what I've enjoyed most is the quality of discussions and interactions. Engaging in conversations with fellow members who are passionate about finance has been intellectually stimulating and has provided me with fresh insights into various aspects of the field. [Networking & collaborating in finance: A testimonial“I see high value in networking and meeting others and the Finance Alliance has been super helpful for that. Using Slack, online meetings, events and publications from the Finance Alliance has been valuable.”![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/Copy-of-FA_Case_Study_Template-5.png)](https://www.financealliance.io/the-power-of-networking-case-study/) ### 3\. What type of discussions have you found the most insightful and useful? The discussions that I've found most insightful and useful are those focused on emerging trends in finance, strategic decision-making in uncertain markets, and discussions around innovative technologies shaping the future of financial services. These discussions have helped me stay ahead of industry changes and make informed decisions. ### 4\. What type of resources have you found the most helpful? The resources I've found most helpful include webinars by industry experts, whitepapers on pertinent financial topics, and access to relevant market reports. These resources have complimented my existing knowledge and helped me expand my expertise. ### 5\. Have you built up any new connections? Yes, I have built new connections within the community. I've engaged with professionals from different sectors of finance, enabling me to [broaden my network](https://www.financealliance.io/11-networking-in-finance-tips/) and establish relationships that could lead to potential collaborations in the future. ### 6\. How has the community impacted your professional growth? The community has had a significant positive impact on my professional growth. Engaging in discussions and accessing valuable resources has enhanced my understanding of complex financial concepts, improved my decision-making abilities, and allowed me to stay updated with the latest industry trends. ### 7\. Can you share a specific instance where the community helped you overcome a professional challenge? One specific instance where the community proved invaluable was when I faced a challenge in understanding the implications of a regulatory change. I posted my query in the community forum, and within hours, I received responses from experienced professionals who provided clarity on the matter, helping me make informed choices for my organization. [Thinking about attending the FP&A Summit? Testimonials“I think it was an amazing day, what I really enjoyed was having so many diverse backgrounds with extremely skilled profiles. I think you did an amazing job bringing all those people together.”![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/Copy-of-FA_Case_Study_Template-6.png)](https://www.financealliance.io/thinking-about-attending-the-fp-a-summit-hear-from-our-attendees/) ### **8\. In what ways have you contributed to the community, and what was the outcome?** I've actively contributed to the community by participating in webinars as a panelist, sharing insights from my expertise, and providing guidance to fellow members seeking advice on specific financial topics. The outcome has been positive, as these interactions have fostered engagement and enriched the overall knowledge pool. ### **9\. How would you describe the culture of the community?** The culture of the community can be described as inclusive, collaborative, and forward-thinking. Members are supportive and eager to share their knowledge, fostering an environment where everyone feels comfortable contributing and learning from each other. ### **10\. How do you see the value of this community in comparison to other professional networks you're part of?** The value of this community stands out in comparison to other professional networks due to its specialized focus on finance. Unlike broader networks, Finance Alliance offers a more tailored and in-depth exploration of finance-related topics, attracting professionals who are deeply committed to the field. ### **11\. Why should other finance professionals join the community?** Other finance professionals should consider joining the community to tap into a rich pool of expertise, engage in thought-provoking discussions, access up-to-date resources, and develop connections that can shape their career trajectories. The community provides a unique platform for continuous learning, collaboration, and staying ahead in an ever-evolving financial landscape. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### FAnow - exclusive finance live streams URL: https://www.financealliance.io/fa-now/ Last updated: 2024-12-02T21:54:52.000Z FAnow is your chance to stream exclusive talks and presentations, hosted by finance experts and industry leaders. It's a unique opportunity to watch the most sought-after finance content – ordinarily reserved for FA Pro members. Each stream delves deep into a key finance topic, industry trend, or case study. Simply sign up to watch any of our upcoming live sessions. 🎥 Access exclusive talks and presentations ✅ Develop your understanding of key topics and trends 🗣 Hear from experienced finance leaders 👨‍💻 Enjoy regular in-depth sessions **Take a look at what we've got coming up** 👇 ### Championing diversity, equity, and inclusion: Women in the C-Suite *Coming soon* Dive into an inspiring panel discussion that champions the power of women in executive roles. Hear firsthand how trailblazing female leaders are shattering barriers and driving DEI initiatives from the top. Gain dynamic insights and actionable strategies for creating a truly inclusive culture, and discover how these influential women are redefining leadership and making a lasting impact in the C-suite. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/12/FAnow---January-14.png) --- ### ChatGPT, Microsoft Co-Pilot and beyond: The CFO's Guide to leveraging Generative AI *Coming soon* Step into the realm of cutting-edge innovation with our masterclass on embracing Generative AI. Discover the thrilling opportunities and potential pitfalls that lie ahead for CFOs in this dynamic landscape. But beware! With great power comes great responsibility. Learn from experts about the risks associated with Generative AI, from ethical considerations to data security concerns, and gain practical advice on navigating these challenges. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/12/FAnow---Feb-11.png) --- ### AI in finance- Balancing efficiency with human insight—A cautionary tale *Coming soon* As AI becomes a cornerstone in manufacturing finance—automating numbers, building budgets, and streamlining operations—there’s a growing risk of losing the social dynamics essential to securing buy-in from key stakeholders. Budgets are more than mere data; they represent agreements between people, often facilitated by local financial analysts whose social interactions bridge gaps and ensure alignment. This keynote explores the potential consequences of over-reliance on AI in financial processes, including the erosion of the human element in decision-making, the loss of critical training grounds for future CFOs, and the broader implications for developing leadership talent. Join us as we dive into strategies for leveraging AI while preserving the human touch in financial strategy and team development. ### 4 strategies for building a high-value client portfolio for fractional CFOs URL: https://www.financealliance.io/client-portfolio-fractional-cfo/ Last updated: 2025-11-10T09:12:42.000Z The clients you choose as a [fractional Chief Financial Officer](https://www.connexioncfo.com) (CFO) aren't just a reflection of your market niche – they define your day-to-day work and strategic focus. Building your ideal client portfolio requires some self-reflection and a deep understanding of your: - Professional goals - Personal preferences - The specific financial expertise you bring to the table Keep reading for four key factors you should weigh as a fractional CFO when it comes to building your client portfolio. Each one highlights the importance of being selective and working with clients that align with your vision and how you operate. ## **1\. Building the foundation** At the start of your career as a fractional CFO, your immediate priority is most likely going to involve building a stable revenue base. In this initial phase, you might need to be more flexible with the clients you accept to help build a stable revenue stream. The goal here is to establish credibility in the market and accumulate a diverse range of experiences. Early clients may come from various sectors and have different needs and challenges, from start-up financial structuring to more mature business refinancing or strategic redirection. However, this stage is also about learning and identifying the: - Industries you resonate with. - Business sizes that you manage most effectively. - Types of business challenges that align with your expertise. While initial flexibility in client selection helps build a [stable income stream](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/), this diversity also offers a broad range of experiences. Having a diverse client portfolio is important it provides a broad experience base from which to refine your preferences and expertise. --- [How to become a fractional CFO | Finance AllianceMany CFOs have left full-time positions to regain control of their careers and their time. But how did they do it? That’s what you’ll find out in this blog post as we uncover how to become a fractional CFO.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/03/Fractional-CFO.jpg)](https://www.financealliance.io/how-to-become-a-fractional-cfo/) --- ## **2\. Refining your client base** As your practice grows and stabilizes, the need to be selective becomes paramount. This shift towards selectivity prioritizes quality over quantity. You'll ideally choose clients who aren't only financially viable but also align with your [strategic goals](https://www.financealliance.io/building-an-fp-a-function-strategies-for-effective-team-and-organizational-structure/) and how you prefer to operate. But what makes a ‘good’ client? A 'good' client for a fractional CFO typically aligns with several key criteria: ### **Business size and sector** Depending on your expertise and comfort, you may find yourself more effective in certain industries or with businesses of a particular size. Some CFOs thrive in the dynamic atmosphere of tech start-ups, while others prefer the steady pace of established manufacturing firms. ### **Growth orientation** Ideal clients often have clear growth ambitions or need strategic financial guidance at a critical juncture. Whether they aim to scale operations, explore new markets, or prepare for an IPO, these clients leverage the full scope of your expertise. ### **Management and culture** The personality of the business owners and [key stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) plays a significant role. Clients whose leadership styles and corporate culture align with your own are likely to result in more harmonious and productive engagements. ### **Strategic needs** Aligning with businesses that have strategic needs matching your skill set allows you to provide the most value. Engagements that require constant firefighting or [emergency management](https://www.financealliance.io/financial-crime-risk-management-fcrm/) can be draining and might not necessarily leverage your strategic financial skills effectively. ## **3\. Avoiding potential pitfalls** While the urge to expand your client base can be strong, especially after initial success, fractional CFOs should be wary of certain pitfalls: ### **Chronic firefighting** Engagements where the primary role is to address continual crises can be unproductive. These often signal deeper managerial or operational flaws that need more than a financial strategy to rectify. ### **Misaligned goals** Working with clients who have unclear or misaligned goals can lead to frustration and wasted effort. Both parties must have a clear understanding and agreement on the outcomes expected from your engagement. ### **Overextension** Taking on too many clients or those outside your expertise realm can dilute the quality of your service and strain your capacity. This not only affects your work-life balance but can also harm your professional reputation. --- [The CFO’s crash course in finance and complianceGovernance, risk management and compliance. These aren’t exactly the most exciting aspects of a CFO’s role, but that doesn’t stop them from being vital areas of focus. 🎯![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/06/FA_Framework_Tiles_3_compliance.jpg)](https://www.financealliance.io/finance-and-compliance/) --- ## **4\. Maintaining and growing your client portfolio** Once you’ve identified and begun to work with your ideal client types, the focus shifts to maintaining and strategically growing your client portfolio. To achieve that, start by performing regular evaluations where you continuously assess how well each client aligns with your goals and their [profitability](https://www.financealliance.io/time-to-value-metric/). This helps in making informed decisions about contract renewals or realignments of service terms. Next, ask for referrals. Satisfied clients are often happy to recommend your services. A referral is a powerful endorsement of your capabilities and a fantastic way to grow your client portfolio sustainably. Finally, you need to [build your network](https://www.financealliance.io/11-networking-in-finance-tips/) and visibility. You can maintain visibility in relevant professional circles through speaking engagements, publications, and active participation in industry events. This proactive approach establishes you as a thought leader in the fractional CFO space, attracting clients who appreciate your strategic financial guidance and focus on long-term value creation. ### To conclude... Building your ideal client portfolio as a fractional CFO is an ongoing journey. It starts broad, then sharpens as you refine your expertise, understand your professional goals better, and identify the businesses that truly benefit from your services. Ultimately, the right mix of clients balances your professional strengths with client needs, creating synergies that enhance both your satisfaction and business impact. By being selective and strategic about client engagements, you ensure that your work as a fractional CFO remains both rewarding and effective. Remember, the right clients are those that not only grow from your expertise but also contribute to your growth as a leader. --- ## FAQs: Building a client portfolio What does a client portfolio include? Think of it as a detailed roadmap for each client. It includes basic information like company name and industry, but also dives deeper into the specifics of your engagement. This could involve details like the scope of services, fees, contract terms, the client's financial needs and goals, performance metrics showcasing your impact, and a record of key interactions and decisions. Why is a client portfolio important? A client portfolio empowers informed decision-making. By analyzing your portfolio, you can evaluate client fit, profitability, and long-term value. It also helps you to track progress and the impact you're making on your clients' finances. How do you create a client portfolio? Start by building a basic system to track client information. Spreadsheets or CRM software can work well. As you gain clients, record the details mentioned above. Regularly update the portfolio with new information and performance metrics. How do you handle a client portfolio? Active management is key. Regularly review your portfolio to assess client fit, profitability, and alignment with your goals. Maintain open communication through meetings and reports to keep clients informed and engaged. As you gain experience, focus on selective growth, prioritizing quality clients over quantity. Finally, track your financial impact and adjust strategies when needed to optimize your success. How important is it to be selective about clients? Very important! As you gain experience, focus on quality over quantity. Choose clients who value your expertise, align with your goals, and contribute to a fulfilling work experience. How do I know if a client is a good fit? Regularly chat with clients to see if their needs align with your skills and goals. Look for clients who appreciate strategic guidance and are open to collaboration. How can I find the right clients? Network with other professionals, speak at industry events, and write articles to establish yourself as a thought leader. Satisfied clients are also a great source of referrals! What's the ultimate goal of building a client portfolio? To create a win-win situation! You want clients who benefit from your expertise while also allowing you to use your skills, grow as a leader, and find fulfillment in your work. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### 5 actionable tips to build trust as an FP&A business partner URL: https://www.financealliance.io/fp-a-business-partner/ Last updated: 2025-04-10T07:47:59.000Z Building trust is the bedrock of success for any FP&A business partner. Without it, collaboration crumbles and strategic decision-making becomes nearly *impossible*. When there’s a lack of trust, business leaders often hesitate to share vital information, leading to inaccurate forecasts and analyses with blind spots.🙈 A wise man (Stephen Covey) once said, “**Change moves at the speed of trust**” and that still holds true today - *especially* when it comes to the role of an FP&A business partner. But how can you build trust *fast*? Here are the five key tips I shared at [Finance Alliance's FP&A Summit](https://www.financealliance.io/ondemand/) to help you build trust with the right people quickly *and* effectively: ![FP&A business partner - building trust](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/Screenshot-2024-06-21-at-16.10.03-1.png) ## 1\. Listen deeply At the key turning point of my career, I asked myself several questions: - How am I showing up to listen deeply? - How am I showing up to provoke thought and to ask important questions? - How am I showing up to keep it simple? - How am I showing up as a human to that business partner? - How am I showing up to help keep myself relevant? My answer to these questions fuelled me to transition into the trusted [FP&A business partner](https://www.financealliance.io/finance-business-partnering-playbook-2/) I am today. Of course, it took time to reach this point in my career and a piece of advice that helped me was when someone said: > “*You’ve got two ears and one mouth, and you need to use them in that order*.” You might have heard similar advice yourself and for good reason. When you’re talking to someone and they’re actively listening to you, it makes you feel valued and heard. That’s why it’s *so* important to show others the same courtesy and remember to not just hear what they’re saying, but truly *listen* to them. ![FP&A business partner - how to become a better listener](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/Screenshot-2024-06-21-at-17.48.44-1.png) **How to be an active listener* When you’re talking to your business partners, whether that’s the CFO, CEO, or other [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/), think about *how* you’re showing up to them. Do they feel heard? Valued? Do they feel like you care? Active listening is so important, which means paying attention to more than the words spoken out loud. **Hit play below to hear some of the tips to help you become an active listener \[from my session at the FP&A Summit\].**👇🏼 ### ## 2\. Provoke thought by asking questions Asking open questions is often the best thing to do. Yes, there are times when closed questions work (usually when you need a direct answer), but a lot of the time, they’re unnecessary. For example, you’ll often hear about the ‘five whys.’ As an FP&A business partner, this is completely normal as we’re curious people and often use these types of questions to get more concrete answers when we need them. However, using the word ‘why’ can come across as being rather direct, which might be fine for a certain audience. But if you’re dealing with a mix of different personalities, you may be more successful at building trust by taking a *softer* approach. It's about being more mindful of your tone and the way you say things when asking questions. For example, instead of asking something like “*Why have you done that?*” you can opt for “*Can you tell me more about your thinking behind that decision?*” It’s a slightly different question, but you’ll still get the same answer. ![Asking better questions as an FP&A business partner](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/Screenshot-2024-06-21-at-17.48.54-1.png) **How to ask better questions* Here are some more question ideas to help you challenge someone *without* coming across as overly direct: - *"That’s interesting, can you tell me/walk me through that?"* - *"If you were to put your X hat on, how would you challenge this?"* - *"What would need to be true to achieve XYZ?"* - *"What would the reasons to believe in this be?"* Another suggestion I have for anyone who wants to be a successful FP&A business partner is to be comfortable with silence. I explain why in this short video: An issue we often face in this role is getting enough feedback from others. Whether you’ve asked for input via a form or through an informal chat, it can be difficult for people to give you the feedback you need. Instead of bombarding them with technical jargon, focus on understanding their biggest challenges. So, you might ask things like: "*If I could help you with one thing in your financial planning, what would it be?*" or... "*What kind of information would make the biggest difference in your decision-making?*" By focusing on their needs, you can provide insights that are truly valuable and that you can implement to reach your goals. This type of approach is particularly useful if you’re short of time or in need of feedback quickly. ## 3\. Keep it simple I used to think that the more complicated our charts looked, the better our analysis. Of course, I was later proved wrong when I learned that complicated charts are rarely beneficial to anyone [outside of the finance department](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). ![FP&A finance business partnering](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/Screenshot-2024-06-21-at-17.49.04-1.png) **How to keep it simple* I teamed up with our [HR business partner](https://www.financealliance.io/why-cfos-need-to-be-people-managers/), who struggled with [charts and reports](https://www.financealliance.io/financial-charts-and-graphs/). And I thought, if I can get her to understand what's happening, then the whole room will. This is a great tip if you find yourself in a similar situation. Another tip that helped me was something I read in a book called ‘*Simply Said*’, and it was about removing the ‘noise of words’ in written emails and presentations, etc. The book talked about the concept of a ‘zero word’, which are words that have little to no impact. By getting rid of those words, you can create simpler [presentations](https://www.financealliance.io/how-color-impacts-your-finance-presentations/) that your audience understands. --- [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/financial-charts-and-graphs.jpg)](https://www.financealliance.io/financial-charts-and-graphs/) --- ## 4\. Show how you’re human In finance, there’s often the perception that we’re all introverted and just want to do our jobs and go home. However, we know how important it is to build connections with people and we do that by showing others we’re *human*. > **“When I take my mask off, and I show my vulnerabilities, people start to show theirs.”** \- Gemma Davie, Head of Finance Business Partnering at Anglian Water (from the FP&A Summit) In my presentation at the FP&A Summit, I shared this story (in the video below) about a time when I showed vulnerability in a leadership meeting, which helped me build trust with the team. It wasn’t exactly something I planned to do, but I learned a valuable lesson from it about showing your human side as an FP&A business partner: Making mistakes and showing vulnerability can help build trust with colleagues and clients. As a perfectionist (and an FP&A professional), you don’t want your numbers to be wrong. However, mistakes happen. But when they *do* happen, it’s important to take [accountability](https://www.financealliance.io/financial-accountability/) and grow from your mistakes rather than dwell on them. ## 5\. Sharpen your saw I believe that if I stand still and do nothing, and everyone else is moving forward, then I'm effectively moving backwards. So, that’s why it’s important to always try to improve and take steps to stay relevant and sharp. ![Staying sharp as an FP&A business partner](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/Screenshot-2024-06-21-at-17.49.15-1.png) **How to stay sharp* If you’re like me, you’ll often find that a lot of your time is taken up with meetings. My diary was *so* packed with meetings that I had to be a little selfish with my time. So, I blocked time in my diary to focus on what I wanted to do with that time. For example, taking time to think creatively or strategically about a problem. Or, taking time to prepare for a meeting beforehand so I know what to cover. Doing this is a great way to make sure you have time to get things done and to help ensure you're using your time wisely. It also frees up mental space for self-reflection. By taking stock of your achievements, you can identify areas for improvement and celebrate your successes. This focus on both growth and progress fuels a more fulfilling and productive work experience. *\[This article has been adapted from Gemma Davie's presentation "Make a difference: Top tips on how to be an impactful finance business partner" at the London FP&A Summit\]* --- ### Actionable takeaways - Evaluate your listening skills and look for ways to minimize distractions and fully focus on the speaker. - Try some of Gemma's go-to questioning techniques like "Can you tell me more?" to encourage deeper thinking. - Consider doing an Insights assessment or Myers-Briggs test for self-awareness. --- ## **Become a strategic finance leader through business partnering & storytelling** Take the leap from being a number-cruncher to becoming a trusted business advisor who drives decisions and profits through effective data storytelling. Enrol in our **certified** [**Business Partnering & Storytelling**](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) course, which includes engaging video lessons, detailed slides, and practical examples. Master the art of communicating complex data in a compelling way that inspires action and builds strong partnerships. With expert guidance from **Christian Wattig** (founder of FP&A Prep), you’ll learn how to present data that influences decisions, build stronger relationships, and become a key player in your organization’s success. [Sign up here](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) ### 9 upcoming trends that are transforming FP&A URL: https://www.financealliance.io/9-upcoming-trends-that-ransforming-fp-a/ Last updated: 2025-11-12T09:04:54.000Z As the FP&A function continues to evolve, it's essential for financial professionals to stay up to date on the latest trends. In this article, we'll explore nine of the top upcoming trends that are transforming FP&A. ## 1\. More emphasis on real-time data and forecasting By using advanced financial modeling techniques and tools, FP&A professionals can help their organizations make better-informed business decisions by using real-time data. ## 2\. Increased use of BI tools and data analytics to improve decision-making Identifying the key questions the business wants to answer through BI and [data analysis](https://www.financealliance.io/microsoft-fabric-for-data-analysis/). This will help FP&A focus on the most important problems and opportunities and prioritize their efforts. ## 3\. Adoption of agile FP&A methodologies Adopting agile methodologies can help FP&A teams become more effective and adaptable by embracing continuous improvement, encouraging flexibility and adaptability, prioritizing business value, and using agile tools and techniques. ## 4\. Greater focus on scenario planning and risk management Scenario planning is a process that involves identifying and analyzing potential future outcomes for the organization. Risk management is the process of identifying, assessing, and [mitigating risks](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) that could impact the organization. By focusing on risk management and scenario planning, FP&A can provide valuable support and insights to the organization to help it achieve its strategic goals. [FP&A Manager Salary Insights 2023Our latest Finance Salary Report revealed the average FP&A Manager salary to be $76,767 globally and $132,500 in the US. Those figures are more than just digits on a screen - they’re a testament to the value organizations place on financial planning and analysis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/FP-A-Manager-salary.jpg)](https://www.financealliance.io/fp-a-manager-salary/) ## 5\. Expansion of the FP&A role The FP&A role is going beyond traditional financial analysis to include strategic planning and business partnership. ## 6\. Integration of sustainability [Environmental, social, and governance ](https://www.financealliance.io/esg-metrics/)(ESG) factors are becoming more integrated into financial planning. ## 7\. Use of automation and machine learning Automation and machine learning (ML) are becoming more instrumental in streamlining key processes and helping to improve efficiency. ## 8\. Greater use of visualizations and dashboards FP&A teams are relying more on visualizations to better communicate key financial information. ## 9\. Collaboration FP&A is collaborating with other departments and functions to drive real business value. [14 dos and don’ts for an accurate financial forecastPreparing an accurate financial forecast demands precision, attention to detail, and a clear understanding of the economic landscape. Below, we’ve curated seven dos and seven don’ts to fine-tune your forecasting process.👇![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/dos-and-don-ts-finance-forecast-2.jpg)](https://www.financealliance.io/14-dos-and-donts-financial-forecast/) In conclusion, the FP&A landscape is continually evolving, with new trends emerging to help finance departments become more agile and efficient. We've highlighted nine of the most important trends that are transforming the way FP&A operates. By understanding these trends and how they will affect the profession, FP&A professionals can take advantage of their full potential. --- ## FP&A Certified Core: Reach your full potential Ready to improve your financial planning and analysis skills and skyrocket your career growth? Our [**FP&A Certified: Core course**](https://certified.thealliance.io/course/fpa-certified-core) is your gateway to mastering the skills and know-how needed to drive strategic business growth with the power of FP&A. By the end of this course you’ll be able to.. - Build accurate forecasts - Turn data into insights - Become a business partner ….and more. [Enrol today](https://certified.thealliance.io/course/fpa-certified-core) ### 3 strategies to slash costs with corporate treasury URL: https://www.financealliance.io/corporate-treasury-guide-plus-3-strategies-to-save-your-company-a-fortune/ Last updated: 2025-04-07T16:37:25.000Z Too often, companies make the mistake of sidelining corporate treasury as just another back-office function when it *should* be viewed as a key player in a company’s success. An effective corporate treasury department is much more than cutting checks and keeping the books tidy. When managed properly, it becomes a strategic function that optimizes cash flow, mitigates risks, and ultimately, saves your company a *fortune*. ![](https://media.tenor.com/esGKjyJ0obkAAAAC/rhode-island-uri.gif) To find out how, keep reading as we cover the basics of corporate treasury and reveal three strategies to achieve this transformation. --- **Key takeaways:** - A strong treasury department is a valuable strategic partner within a company, not just a back-office function. - Corporate treasury keeps the company on the financial straight and narrow - they make sure companies follow regulations properly. - The core functions revolve around managing a company's liquidity, mitigating financial risks, and leveraging capital resources. --- ## **What is corporate treasury?** Corporate treasury refers to the division within a company responsible for managing financial resources and risks. They make sure the company has enough cash on hand to manage its day-to-day needs, invest funds wisely, and [mitigate financial risks](https://www.financealliance.io/risks-of-mergers-and-acquisitions/). ![Corporate treasury definition](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/Corporate-treasury-2.png) ### **Treasury in a large vs small company** According to[ The Association of Corporate Treasurers](https://www.treasurers.org/hub/careers/what-is-treasury#:~:text=Your%20role%20is%20to%20monitor,financial%20risks%20to%20the%20business.) (ACT), large businesses are likely to have a dedicated corporate treasury team “*across multiple regions and countries that operate as part of a wider finance division*.” In small businesses, treasury probably isn’t going to have its own function or specific role. Instead, members of the finance team will likely “*carry out specific treasury activities as part of their day-to-day responsibilities.*” --- [6 proven negotiation tactics to seal the dealTime is money, especially when it comes to acquisitions. Deal fatigue can drag negotiations on for months and every day a deal remains unclosed is another day of lost opportunities and unrealized profits.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/Negotiation-tips.jpg)](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/) --- ## **Corporate treasury functions** While the functions of corporate treasury can vary across businesses, most of a treasurer’s core responsibilities fall under these key areas: ### **Corporate treasury cash management** This involves keeping track of all the money coming in and going out of the company. Treasurers also ensure there's enough liquidity to cover critical expenses like payroll and inventory purchases. On a daily basis, treasurers determine the [optimal cash positioning](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/) strategy. For example, they’ll decide how much cash to keep available for operational needs versus how much to invest to generate returns. They’ll also manage the company’s bank. They’re often the ones deciding how much money to put in the bank, which helps the company prepare for any surprises and keep running smoothly. Under the cash management umbrella, the treasury team: - Forecasts cash needs - Manages bank relationships - Optimizes collection and payment processes - Ensures sufficient liquidity to meet ongoing operational expenses ### **Funding and financing** Another important responsibility for corporate treasury functions is funding and financing. For example, treasurers may be responsible for obtaining loans from banks or selling bonds to [investors](https://www.financealliance.io/cfos-role-in-investor-communications/). They also make sure the company can pay back its loans and will help secure better interest rates. This helps the company afford big projects without running out of money. ### **Risk management** Corporate treasurers also protect the company from money problems and financial risks. They do this by keeping watch for things like changing interest rates or costs that could go up or down unexpectedly. For instance, if they know the cost of borrowing money might go up, they can act early to lock in a lower rate. This keeps the company stable and avoids surprises in spending. ### **Managing investments** The treasury department acts as the bridge between the company and its financial partners. So, expect them to be the ones managing investor relations, especially for publicly traded companies. This involves working with the investor relations team to communicate with shareholders and analysts regarding the company's financial health. With specific investment decisions, the corporate treasury department will develop and implement investment strategies for surplus cash, ensuring a balance between security and return. ### **Payments and collections** Ensuring smooth and efficient domestic and international payments to vendors and [suppliers](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/), as well as managing the collection of receivables from customers. This might involve: - **Payment optimization:** Negotiating payment terms with suppliers to secure early payment discounts or extended payment periods to optimize cash flow. - **Collections strategy:** Developing strategies to collect outstanding payments from customers quicker, potentially including implementing late payment fees. ### **Financial compliance** Ensuring [financial compliance](https://www.financealliance.io/finance-and-compliance/) is a huge part of the role of a corporate treasurer, which means making sure the company adheres to all relevant financial regulations. Foreign Exchange (FX) Management is also vital, and treasurers must monitor and mitigate the company’s exposure to currency fluctuations. To do this, they’ll often use hedging instruments like forwards or options contracts to lock in exchange rates for upcoming transactions. In corporate treasury, it’s vital to stay up-to-date with (and ensure adherence to) international sanctions and trade regulations. This helps protect the company from legal and reputational risks connected with violating these regulations. ### **Treasury liquidity management** Although similar to cash management, [liquidity management](https://www.financealliance.io/12-proven-strategies-for-managing-liquidity/) in treasury looks at a much bigger picture when it comes to a company’s financials. Its main purpose is to make sure the company has enough liquid assets (easily convertible to cash) to meet short-term obligations. This goes beyond simply monitoring checking account balances and involves: - Developing accurate forecasts of future cash inflows and outflows to anticipate potential shortfalls and excesses. - Managing inventory levels, receivables, and payables to ensure the best use of [working capital](https://www.financealliance.io/multiple-on-invested-capital-moic/) (and minimize the amount of cash tied up in non-liquid assets). - Investing surplus cash in low-risk, highly liquid instruments to earn a return while ensuring the funds can be readily accessed if needed. - Establishing and maintaining relationships with lending institutions to secure backup lines of credit in case of unexpected cash flow disruptions. --- --- [Earnings credit rate (ECR) formula & breakdownAccount maintenance, wire transfers, check processing...they all add up. And the more you use bank services like this, the higher the charges. But what if you could recoup some of those costs? Thankfully, there’s a way to offset these types of costs and that’s with the earnings credit rate (ECR).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/earnings-credit-rate-2.jpg)](https://www.financealliance.io/earnings-credit-rate-ecr/) --- ## **3 strategies to transform your corporate treasury department** As the CFO, you understand the critical role your corporate treasury team plays in protecting the company's financial state. However, by leveraging treasury as a strategic tool, you can help it drive even more value and [improve financial performance](https://www.financealliance.io/flexible-budget-performance-report/) in a big way. Here are three strategies to consider: ### **1\. Shorten the working capital cycle** Corporate treasury can experience snags when it comes to managing the working capital cycle and attempting to shorten it. Most of these hurdles are internal issues like disjointed processes within the finance function, inaccurate data, restricted visibility, and the inability to control the working capital management policy. All of these issues can be a real headache. But, if you can successfully navigate these obstacles, corporate treasury can become a strategic advisor to the business and shorten the working capital cycle, which can help: - Convert assets into cash quicker - Build better liquidity and financial flexibility - Reduce reliance on external financing - Increase profitability - Make the company’s operations more efficient According to Deloitte's report, "[*The Strategic Corporate Treasurer: Backbone of a Successful Organization*](https://www2.deloitte.com/content/dam/Deloitte/in/Documents/risk/in-risk-strategic-corporate-treasurer-noexp.pdf)," three critical elements must be embedded within the corporate treasury framework to achieve a sustained shortening of the working capital cycle: - Innovative financial solutions to unlock liquidity from receivables and inventory. - Continuous monitoring of working capital metrics, blockages and leakages. - Consultative and continuous engagement with the business and business finance. By focusing on these core principles, corporate treasury can become a strategic partner in optimizing cash flow. ### **2.** **Leverage big data and predictive analytics** The finance function is usually drowning in data. In fact, the[ World Economic Forum](https://www.weforum.org/agenda/2019/04/how-much-data-is-generated-each-day-cf4bddf29f/) estimates the amount of captured data at a staggering 44 zettabytes – 40 times more bytes than stars in the observable universe! By 2025, this daily data deluge is expected to reach 463 exabytes globally. For corporate treasury departments, this presents both a challenge and a huge opportunity. By leveraging big vast amounts of financial data from various sources (transactions, bank statements, market trends), you can gain deeper insights into things like cash flow forecasting, risk management and optimizing investments. Predictive analytics can identify patterns and trends in cash inflows and outflows, which can help you create more accurate forecasts. In corporate treasury, this technology could potentially spot a currency fluctuation that could impact your overseas operations. By having that nudge in advance, the treasury department can then implement hedging strategies to help minimize potential losses. This is just one example of how predictive analytics and [big data](https://www.financealliance.io/what-is-big-data-security-analytics/) can help improve corporate treasury. Of course, you’ll still need to make sure to invest in the right tools and build a data-driven culture so everyone has the necessary skills to interpret and utilize data insights to inform decision-making. ### **3.** **Foreign Exchange Exposure Netting** If you work for a large company that operates in more than one country, you’ll likely face significant foreign exchange (FX) risks. Unfortunately, a slip-up can lead to significant transaction costs and vulnerability to currency fluctuations. This is where foreign exchange exposure netting proves useful. So, what do we mean by FX exposure? Let’s put this into context in the real world. *Imagine your company has a subsidiary in Europe that owes 1 million euros (EUR) to a supplier in three months. At the same time, you have a US-based customer who will pay you $1.2 million (USD) in three months.* *On the surface, these transactions appear balanced. But, their value is subject to the exchange rate between EUR and USD at the time of settlement.* *So, if the euro strengthens against the dollar in the next three months, you'll receive fewer euros for your US dollar receivables, which can impact your bottom line. This is FX exposure.* Foreign exchange exposure netting can help you: - Reduce the overall number of FX transactions needed (and therefore help you save on costs such as conversion fees). - Minimize the impact of currency fluctuations on your cash flow by offsetting exposures. - Get a clear view of your net FX exposure across different currencies, which allows for better forecasting. So, if we used this strategy in our example above, this is potentially how that might play out: *By netting your 1 million euro payable with your 1.2 million USD receivable (converted to euros at the current exchange rate), you eliminate your FX exposure on this specific transaction.* *In turn, this eliminates the risk associated with euro fluctuations and simplifies your foreign exchange management.* Netting is a powerful tool, but it requires some preparation. For example, it’ll help if you can consolidate your foreign exchange data from all subsidiaries and business units to create a holistic view of your exposures. For netting to work smoothly, you need to build [clear communication protocols](https://www.financealliance.io/stakeholder-communication-plan/) between your corporate treasury department and operating units to ensure timely updates on upcoming payables and receivables. ## Corporate treasury FAQs #### ****What is liquidity management in treasury?** Liquidity management in treasury involves managing the balance between a company's immediate cash needs and its investment opportunities. The goal is to ensure that the company can meet its short-term obligations while maximizing its financial returns. #### ****What does treasury do in a company?** The treasury department manages the company’s cash, investments, and risk to stabilize the corporate finances. They handle debt issuance, capital structure decisions, risk management, and banking relationships. #### ****What is corporate treasury management?** Corporate treasury management involves overseeing a company’s financial assets and holdings, with the aim to maximize the firm’s liquidity, make wise financial investments, and reduce financial risk. #### ****What’s the difference between treasury bonds vs corporate bonds?** Treasury bonds are issued by the government and are considered risk-free, while corporate bonds are issued by companies and involve higher risk and potentially higher yields reflecting the creditworthiness of the company. #### ****How can we improve our corporate treasury operations?** Improvements can be made by integrating advanced analytics for better decision-making, automating routine tasks to increase efficiency, and continuously training staff to keep up with financial strategies and technologies. #### ****What is the difference between a bank and a corporate treasury?** A bank offers financial services to the public and handles deposits, loans, and investments, while a corporate treasury manages the financial operations and risks of a specific company. #### ****What is the difference between corporate finance and corporate treasury?** Corporate finance deals with strategic financial decisions, mergers, acquisitions, and long-term financial planning, while corporate treasury focuses on day-to-day management of company funds, liquidity, and risk. #### ****Does corporate treasury pay well?** Yes, corporate treasury positions typically offer competitive salaries that reflect the significant responsibilities of managing corporate finances and risk. #### ****What is the role of a corporate treasurer?** The Corporate Treasurer is responsible for the company’s capital structure, financial risk management, liquidity, and for maintaining relationships with banks and financial institutions. #### ****What is the role of treasury management in an organization?** The role of treasury management is to optimize the company’s liquidity, ensure financial obligations are met, manage financial risks, and support the overall strategic financial goals of the organization. #### ****Is the corporate treasury front office?** Yes, corporate treasury can be considered a front office role since it involves decision-making that directly impacts the company’s financial strategy and interactions with external stakeholders. --- ### Fast-track your financial career Gain a competitive edge with our Pro+ membership, an exclusive subscription service tailored to help finance professionals reach success. Gain exceptional training from industry veterans, access the latest resources, and connect with like-minded peers who share your passion for achievement. With Pro+, you’ll possess all the tools and knowledge needed to overcome any challenge and excel in your financial career. [Find out more](https://www.financealliance.io/pro-plus-membership/) ## ### How to create a driver-based planning framework URL: https://www.financealliance.io/driver-based-planning-forecasting/ Last updated: 2026-03-11T11:43:35.000Z Looking for better ways to create more efficient and [accurate budgets](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/) and forecasts? You’re not alone. Precision and speed in planning, forecasting, and budgeting aren’t just ‘nice to haves’ – they’re *necessities*. But that’s not always easy to achieve, especially if you’re solely relying on historical data and assumptions to drive your financial plans. This tired approach isn’t *always* the best option and if you want to create more accurate and [agile FP&A processes](https://www.financealliance.io/unleashing-the-power-of-agile-methodologies-for-fp-a/), it’s time to get familiar with **driver-based planning.** Driver-based planning identifies and models the key operational drivers behind your company’s financial performance. With these in place, you can transform budgeting and forecasting from a labor-intensive grind to a seamless, automated process. Find out how in this guide, where we share a proven framework to help you build and embed driver-based planning into your financial planning and analysis processes. --- **Learn how to:** - [Use driver-based planning to create responsive reports ](https://www.financealliance.io/p/5e2691cf-cdc9-4675-ba34-92ab1c2bf48a/#what-is-driver-based-planning) - [Identify your company’s key drivers (internal vs external)](https://www.financealliance.io/p/5e2691cf-cdc9-4675-ba34-92ab1c2bf48a/#what-is-a-revenue-driver) - [Get your boss on board (benefits of driver-based planning)](https://www.financealliance.io/p/5e2691cf-cdc9-4675-ba34-92ab1c2bf48a/#advantages-of-driver-based-planning) - [Build a driver-based planning framework (tailored to your needs)](https://www.financealliance.io/p/5e2691cf-cdc9-4675-ba34-92ab1c2bf48a/#how-to-build-a-driver-based-framework) - [Create a single source of truth for your data](https://www.financealliance.io/p/5e2691cf-cdc9-4675-ba34-92ab1c2bf48a/#create-a-single-source-of-truth) --- ## **What is driver-based planning?** Driver-based planning is a financial planning approach whereby you identify the key factors influencing your company’s performance, rather than just relying on past data. These factors, called ‘drivers’, can be internal, like the number of employees or production volume, or external like market conditions or commodity prices. By identifying and understanding these drivers, you can create more dynamic and responsive financial plans, forecasts, and budgets. ### **Driver-based forecasting & driver-based budgeting** [Driver-based forecasting](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/) and budgeting are two sides of the same coin: a financial planning approach that focuses on the key factors (drivers) that influence a company's performance. You can use these drivers to create forecasts (predictions) and budgets (financial plans) that are more dynamic and adaptable to changing circumstances. --- [6 proven negotiation tactics to seal the dealTime is money, especially when it comes to acquisitions. Deal fatigue can drag negotiations on for months and every day a deal remains unclosed is another day of lost opportunities and unrealized profits.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/Negotiation-tips.jpg)](https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/) --- ## **What is a revenue driver?** A revenue driver is a key variable directly influencing and impacting a company's ability to [generate revenue](https://www.financealliance.io/chief-revenue-officer-vs-chief-financial-officer/). Each revenue driver represents a business activity or operational driver that can lead to increased sales or profits. Some examples include things like sales volumes, units sold, market share, number of subscribers (or customers), customer retention rates, and so on. If you can pinpoint and track these important revenue drivers, you’ll better understand the levers that drive your company’s top-line performance. With these insights, you can build valuable financial plans to help senior management (including the [CFO and CEO](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/)) make informed decisions to optimize revenue streams. ### **Examples of drivers** (internal vs external) ### ![Internal drivers - driver-based planning approach](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/driver-based-forecast.png) On top of internal operational drivers, it's also important to account for relevant external drivers that can impact your company’s performance. Here are some examples of external drivers that could be incorporated into a driver-based framework: ![External drivers - driver-based planning in finance](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/driver-based-planning-image-2.png) ## **Advantages of driver-based planning** If you’re set on transforming your FP&A processes with driver-based planning, you’ll be glad to know it comes with more than a few benefits: - By focusing on key factors that truly drive your company's performance, you’ll create forecasts grounded in reality – not ones solely based on historical data. - You can be *proactive* rather than reactive to changing market conditions. Say you need to see the impact of a potential marketing campaign. Simply tweak the driver for marketing spend and you’ll see how it ripples through your financial projections. ![](https://media.tenor.com/68U_Sux7jJ8AAAAC/jim-carrey.gif) - It’s a less subjective approach to financial planning because it relies on quantifiable operational data, cause-and-effect relationships, and continuous calibration. - Driver-based planning considers both internal and external drivers, providing a holistic view for better financial planning. - It's not a solo act. Instead, this approach encourages collaboration between finance and other departments, like sales and operations. --- [Your ultimate guide to FP&A | Finance AllianceWelcome to the complete guide to financial planning and analysis (FP&A), covering everything you need to know to become a pro at one of the most sought-after roles in finance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/03/FA_website_hub_meta_drivers_of_success.jpg)](https://www.financealliance.io/your-ultimate-guide-to-fp-a/) --- ## **How to build a driver-based framework** Building a driver-based framework is all about making your financial planning smoother and more aligned with the core operations driving your business. Rather than working with high-level assumptions, you'll identify and model the specific operational metrics that truly move the needle on finances. So, how do you go about setting this up? Below, we take you through the steps to create a driver-based framework to use for forecasting, budgeting, and planning. ### **Step 1: Define business goals** People who set goals are [43% more likely](https://persuasion-nation.com/goal-setting-statistics/) to achieve them. So, start by identifying your business goals. This could be anything from increasing revenue to expanding market share, or improving profitability. The key here is to make sure your goals tie back to your company's mission (why you exist) and vision (what you want to achieve). Once you have a list of goals, prioritize them based on their importance and impact. Consider factors like their strategic fit, how achieving this goal will move the business forward, the financial impact, and whether the goal is achievable with available resources and market conditions. According to the [Corporate Finance Institute](https://corporatefinanceinstitute.com/resources/management/smart-goal/), goals that are specific are more likely to be accomplished. To refine your goals, consider answering the following questions: **Who**: *Who is involved in this goal?* **What**: *What do I want to accomplish?* **Where**: *Where is this goal to be achieved?* **When**: *When do I want to achieve this goal?* **Why**: *Why do I want to achieve this goal?* --- ### **Step 2: Identify key operational drivers and KPIs** Now that you have all the data where you need it, you can start to identify the [key operational drivers](https://www.financealliance.io/cash-flow-drivers-in-a-business/) and what key performance indicators you’ll use to measure them in your model. For each business goal, determine the quantifiable metrics (KPIs) that’ll measure progress. These KPIs could be sales figures, customer acquisition costs, or profit margins. Then, you can move onto identifying the key drivers that influence those KPIs. Typically, you'll begin by outlining a few high-level targets - things like your revenue growth percentage, sales volume, or projected cost of goods sold for the period. From those top line targets, you then branch out and split into multiple branches of more detailed drivers below it. As you work on building your framework, you’ll notice it getting increasingly granular the deeper you get into each level. For example, under the revenue target, you might have branches for sales volumes by product line, pricing strategies, marketing spend effectiveness, etc. *Those* branches could then split even further and go on to things like sales volumes breaking down into new customer acquisition rates versus existing customer retention. And *those* retention rates might be influenced by customer satisfaction scores, product quality metrics, and so on. Most robust driver-based frameworks will cascade to several levels. So, while you may only have a couple high-level targets up top, by the time you trace all the branches, you could be modeling and integrating inputs from way more operational drivers across the company. Need help identifying the right drivers? Here’s what we suggest: ![Driver-based planning and forecasting tips](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/driver-based-plans.png) --- ### **Step 3: Assumptions and results** For each driver, you must define the underlying assumptions that’ll impact its performance. This is key in order to model drivers and assumptions that forecast results aligning with your business goals. When you link these components, you can generally rely on a few key drivers to generate most of your planning outcomes. Let’s look at an example to help put this into perspective. **Example: Customer retention rate** First, choose your goal. For now, we’ll go with customer retention rate as the primary goal. Here’s a breakdown of what to do next to help form your driver-based planning model: **1\. Identify the driver** In this case, the primary driver for customer retention is the quality of customer support. The number of customer support representatives and their effectiveness can really influence retention rates. **2\. Define assumptions** Assumptions are the elements that form the logical foundation for your driver. For example, when defining the assumptions for customer retention, you might consider: - **Response time:** The average time it takes for customer support to respond to inquiries. - **Resolution rate:** The percentage of customer issues resolved on the first contact. - **Customer satisfaction score:** The average satisfaction rating given by customers after interacting with support. - **Support training:** The effectiveness of training programs for customer support representatives. In driver-based planning, bad guesses (assumptions) lead to wrong predictions (projections). You want to make educated guesses based on reality to get closer to where you actually land. **3\. Forecast results** Accurate assumptions lead to reliable drivers, which then produce the desired results. For customer retention, the results might include: - **Retention rate:** The percentage of customers retained over a period. - **Customer loyalty:** Measured by repeat purchases or subscription renewals. - **Customer lifetime value (CLV):** The total revenue expected from a customer over their lifetime. This same method can be applied to different business goals. Consider building a financial model that incorporates the identified drivers and assumptions. This will let you [simulate different scenarios](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/) and see how they impact your KPIs and overall business goals. --- ## **Create a single source of truth** A lot of the key drivers of your company will be buried under mountains and silos of data. If that sounds bad, we’ve got worse news for you. Unless you’re working with some extremely organized people, there’s a fair chance all that data is running haywire because it’s coming from different departments within the business. Technically speaking, you *could* have different people collect and sort the data. But that would take a *painstakingly* long time to complete. ![](https://media.tenor.com/pWQeAWBblmYAAAAC/nobody-got-time-for-that-a-intnobody-got-time-for-that.gif) So, one of the most important steps of creating a driver-based planning framework is to centralize the data (and with it, all key business drivers), within a unified enterprise performance management (EPM) system – establishing a single source of truth for reporting, planning, and forecasting. [KPMG](https://kpmg.com/us/en/articles/2023/innovate-fp-and-a-driver-planning.html) reports that having an integrated and unified framework: > *“…connects finance with the essential drivers from across the company—operations, sales and marketing, HR, and more—using agreed-to inputs and values that are vetted by cross-functional teams.”* Driver-based frameworks highlight the value of collaboration, shared understanding, and strategic influence across the business. --- ### FAQs What is the driver-based planning process? Driver-based planning is a method where you identify key business drivers that influence your financial outcomes. You then use these drivers to create models that forecast results. Think of it like mapping out what truly impacts your revenue or costs and using that map to plan ahead. What is an example of driver-based forecasting? Imagine you're running a retail store. A driver-based forecast might look at how the number of store visitors (driver) impacts sales revenue (result). By tracking visitor numbers and average spend per visitor, you can predict future sales more accurately. What is an example of a driver-based budget? In a tech company, a driver-based budget could focus on the number of new product features released (driver) and how this influences R&D costs and projected revenue. If each feature costs $10,000 to develop and brings in $50,000 in revenue, you can budget accordingly. What is a driver-based financial model? A driver-based financial model uses key drivers—like sales volume, customer acquisition cost, or churn rate—to forecast financial outcomes. It helps in understanding how changes in these drivers impact overall financial health. What is data-driven forecasting? Data-driven forecasting uses historical data and statistical methods to predict future outcomes. It’s like looking at past sales data to predict future sales, ensuring decisions are backed by data trends. How to create a driver-based forecast? Start by identifying the key drivers that impact your business outcomes. Collect data on these drivers, create a model linking them to financial results, and use this model to project future outcomes. Regularly update your model with new data to keep forecasts accurate. What is a driver-based cost analysis? Driver-based cost analysis looks at the specific factors driving your costs. For instance, in manufacturing, it might analyze how raw material prices and labor hours impact overall production costs. What is a driver in budgeting? A driver in budgeting is a factor that significantly influences your budget outcomes. For example, the number of employees is a driver for salary expenses, and sales volume is a driver for revenue projections. --- ### Unlock your full potential in FP&A Elevate your career with our [FP&A Certified Core course](https://certified.thealliance.io/course/fpa-certified-core ), meticulously crafted for professionals like you who are driven to excel. Whether you're looking to refine your analytical skills, master budgeting, or steer strategic decisions, this course provides the tools you need to succeed. By enrolling today, you gain access to expert-led tutorials, real-world case studies, and interactive simulations designed to boost your confidence and credentials. Don't just meet the industry standards—set them. Enrol now and transform your professional journey with every module you complete. [Sign up today](https://certified.thealliance.io/course/fpa-certified-core ) ### Beyond FP&A: 9 exciting FP&A exit opportunities URL: https://www.financealliance.io/fp-a-exit-opportunities/ Last updated: 2026-01-08T10:46:12.000Z Ready to move on from FP&A? Or maybe you’re simply curious about what you can do with FP&A experience. Either way, you’re not alone. Many FP&A professionals reach a point where they crave a new direction, and the good news is that having FP&A experience opens doors to a surprising variety of exciting careers. In this article, we’ve curated a list of FP&A exit opportunities that cater to a wide range of interests, skill sets, and ambitions. From scaling the corporate ladder to venturing into the thrilling world of entrepreneurship, you’ve got more than a few options to choose from. Intrigued? Keep reading to discover the best career paths for you after FP&A. **FP&A exit opportunities discussed in this post:** 1. [Progressing within your current company](https://www.financealliance.io/p/cb7bab68-2da1-446b-bfe3-0c178a572bc1/#1-progressing-within-your-current-company) 2. [Consulting](https://www.financealliance.io/p/cb7bab68-2da1-446b-bfe3-0c178a572bc1/#2-consulting) 3. [Corporate finance](https://www.financealliance.io/p/cb7bab68-2da1-446b-bfe3-0c178a572bc1/#3-corporate-finance) 4. [Teaching and mentoring](https://www.financealliance.io/p/cb7bab68-2da1-446b-bfe3-0c178a572bc1/#4-teaching-and-mentoring) 5. [Entrepreneurship](https://www.financealliance.io/p/cb7bab68-2da1-446b-bfe3-0c178a572bc1/#5-entrepreneurship) 6. [Investment banking](https://www.financealliance.io/p/cb7bab68-2da1-446b-bfe3-0c178a572bc1/#6-investment-banking) 7. [Private Equity](https://www.financealliance.io/p/cb7bab68-2da1-446b-bfe3-0c178a572bc1/#7-private-equity) 8. [Venture capital](https://www.financealliance.io/p/cb7bab68-2da1-446b-bfe3-0c178a572bc1/#8-venture-capital) 9. [Portfolio management](https://www.financealliance.io/p/cb7bab68-2da1-446b-bfe3-0c178a572bc1/#9-portfolio-management) --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/10/FA_9_FP-A_Strategies_CTA2--1-.png) ](https://productmarketingall.typeform.com/to/CU9BJK7b) *Psst! Why not download this article in eBook format, so you can always have these insights at your fingertips?* [Grab your free copy](https://productmarketingall.typeform.com/to/CU9BJK7b) --- # **9 FP&A exit** opportunities There's a sea of opportunities waiting beyond the confines of your existing [FP&A career](https://www.financealliance.io/fp-a-salary-and-career-path-guide/). Below, we take a closer look at some of the best FP&A exit strategies that can leverage your skills and propel you towards your dream career. ## **1\. Progressing within your current company** Love your company culture but crave a new challenge? Consider aiming for a senior FP&A position internally. Leveraging your existing expertise and network within the organization allows you to seamlessly transition to a more strategic role, building upon your successes without the upheaval of a new company. Here's how you can make it happen: ### **Chart your course** Identify your target senior FP&A role and develop the necessary skills through training, conferences, and online courses. Focus on areas like finance, [data analysis](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/), and leadership to become more valuable to your organization ### **Step outside your comfort zone** Put yourself forward for projects that showcase your capabilities and help you gain new experiences. This not only demonstrates your initiative and drive but also broadens your knowledge of the business and its various departments. ### Network internally Go beyond your desk and connect with colleagues across departments and levels. Attend company events, join internal committees, and strike up casual conversations with co-workers. [Networking](https://www.financealliance.io/11-networking-in-finance-tips/) helps you gain visibility, learn about internal opportunities, and build a strong support system. about internal opportunities, and build a strong support system. ### Seek feedback and mentorship Regularly ask for feedback from your manager and colleagues to identify areas for improvement. Also, consider finding a mentor who can provide guidance, support, and valuable insights into the company's culture and expectations. Their experience and advice can help you navigate the corporate landscape and accelerate your career growth. ### Showcase your achievements Don't just track your accomplishments, quantify their impact on the business. Weave these success stories into conversations with your manager, both during performance reviews and casual interactions. Highlight how your contributions align with the company's goals and demonstrate your value as a high-performing employee. This not only reinforces your value to the company but also keeps your career goals on their radar. ### Be proactive about promotions Don't wait for opportunities to come to you. Instead, actively seek out conversations with your manager or HR regarding potential promotions or open positions. By expressing your interest and demonstrating your readiness, you'll be better positioned for advancement when the time comes. ### Stay informed about your company's goals Stay in the loop about your company's strategic direction and key priorities. This insider knowledge lets you align your work seamlessly with the organization's goals, demonstrating strategic thinking and making you an invaluable asset to your team. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/FP-A-career-salary-and-path-2.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## **2\. Consulting** Making the leap from an FP&A role to a consulting career can be a rewarding and exciting move. As a consultant, you'll have the opportunity to work with various clients, industries, and projects, offering diverse experiences and challenges. Here are some tips to help you move into consulting: 1. **Enhance your skills** – Focus on improving your analytical, communication, and project management abilities, along with [strategy development](https://www.financealliance.io/podcast/scalable-growth-strategy/) and process improvement expertise. 2. **Gain experience** – Seek projects in your FP&A role that involve cross-functional collaboration or strategic planning to showcase your consulting potential. 3. **Network** – Connect with professionals in the consulting industry. The best way to do this is by attending networking events. You can also try joining relevant groups to expand your connections and gain insights. 4. **Research firms** – Identify consulting firms that align with your interests and values. Learn about their services, clients, and company culture to find the right fit. 5. **Update your resume** – Tailor your résumé to highlight your relevant skills, experiences, and achievements that demonstrate your consulting potential. 6. **Prepare for interviews** – Familiarize yourself with common consulting interview questions in advance. Then, practice case studies to prove your problem-solving skills during interviews. --- ## **3\. Corporate finance** Making the move from FP&A to corporate finance is a natural progression for many professionals. Both fields share similarities and require a strong financial skillset, making it a viable option for FP&A professionals. Corporate finance is a diverse and dynamic field that offers endless opportunities for growth. To excel in this arena, you'll need to leverage your existing analytical and problem-solving skills. As a corporate finance pro, you'll play a pivotal role in: - Managing a company's finances - Dissecting financial data - Making well-informed strategic decisions about investments and operations With your FP&A background, you've already got a solid foundation to build upon. To add to your expertise, consider expanding your knowledge of specific areas of corporate finance. This could include [mergers and acquisitions](https://www.financealliance.io/risks-of-mergers-and-acquisitions/), capital budgeting, or financial risk management. You should also consider pursuing relevant certifications like Chartered Financial Analyst (CFA) to enhance your credibility. These certifications can open doors to new opportunities and career advancements. Some other ways to get your foot in the door include networking and gaining hands-on experience to help sharpen your skills. --- [AI in FP&A: What you need to knowAI in FP&A won’t make you or your role obsolete. But it will help automate routine tasks and give you more time for strategic initiatives. Keep reading to find out how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/03/ai-in-finance.jpg)](https://www.financealliance.io/ai-in-fp-a/) --- ## **4\. Teaching and mentoring** Transitioning from FP&A to a teaching or mentoring role can be a rewarding and fulfilling career change. By sharing your knowledge and expertise with others, you'll have a lasting impact on the next generation of finance professionals. But before diving into a teaching or mentoring career, make sure you genuinely enjoy helping others learn and grow. Passion and enthusiasm are key to becoming a successful educator and mentor. ### Teaching at universities Depending on the level at which you want to teach, you may need additional qualifications or certifications. For example, teaching at a university level often requires a master's degree or higher. Look into the requirements for your desired teaching environment and pursue the necessary education. ### Providing professional development services If you’d rather provide professional development services, you’ll need to create a well-structured curriculum and/or training materials. Professional development can take many forms, such as online courses, in-person workshops, or coaching sessions. Regardless of the format you choose, your curriculum must be engaging and practical. And, it should be tailored to the specific needs of your clients. ### Gaining teaching experience It'll also help if you gained teaching experience in advance. To do this, you can start seeking opportunities to teach or mentor within your current company. Or, reach out for opportunities at a local college, or through professional associations. This hands-on experience will help you develop your teaching style and gain valuable feedback from your students or mentees. Overall, transitioning from FP&A to teaching or mentoring can be a challenging but rewarding career change. It's a chance to share your knowledge and expertise, make a difference in the finance industry, and help others achieve their professional goals. With the right skills, qualifications, and passion, you can become a successful educator or mentor and leave a positive legacy in the world of finance. ![FP&A exit opps and strategies to move on from FP&A - woman carton figure standing on a column ](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/FP-A-exit-opps.jpg) ## **5\. Entrepreneurship** If you have a strong entrepreneurial spirit, starting your own business may be an ideal FP&A exit opportunity for you. This path requires a willingness to take risks, a solid business plan, and the ability to manage finances and operations. If you want to succeed as an entrepreneur, you'll need to be self-motivated, creative, and persistent. One of the main benefits of entrepreneurship is the freedom and autonomy that comes with being your own boss. As an entrepreneur, you can build a business around your passions and interests. Not to mention, you'll have the flexibility to set your own schedule and work from anywhere. To succeed as an entrepreneur, you’ll need a solid business plan outlining your goals, strategies, and objectives. Your plan should also include: ![FP&A exit opportunities - business plan](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/FP-A-exit-opps-business-plan-2.png) Moving from FP&A to entrepreneurship can be a rewarding and challenging career change. It requires a willingness to take riks, a solid business plan, and the ability to manage finances and operations. --- [The evolving role of FP&A in ESG planning and reportingThis blog will explore how FP&A plays a pivotal role in ESG planning and reporting.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTejas Parikh![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/miriam-espacio-H_a57GKWIMI-unsplash--1-.jpg)](https://www.financealliance.io/the-evolving-role-of-fp-a-in-esg-planning-and-reporting/) --- ## **6\. Investment banking** Some of the best exit opportunities for FP&A professionals lie with [investment](https://www.financealliance.io/how-to-streamline-investor-reporting-processes-a-comprehensive-guide/) banking. Investment bankers help companies raise capital from investors, acquire other businesses, and provide advice on various financial transactions. It's a fast-paced and competitive field that involves analyzing business situations, assessing risks, and developing financial models. Despite the prejudice that banking jobs can be a little on the "boring" side of finance, investment banking is anything but. It's a challenging and rewarding career that requires a deep understanding of financial markets, economic trends, and industry-specific knowledge. Investment bankers work with a wide range of clients from small startups to large multinational corporations, providing strategic advice on mergers and acquisitions, initial public offerings (IPOs), and other financial transactions. For FP&A professionals looking to transition into investment banking, there are a few things to consider. ### Financial expertise First and foremost, it's essential to have a solid understanding of [financial modeling](https://www.financealliance.io/10-best-financial-modeling-tools/), valuation techniques, and financial analysis. You'll need to be comfortable working with complex financial data, building financial models, and presenting your findings to clients and colleagues. As an FP&A professional, you likely already tick many of these boxes (if not all). ### Networking Secondly, networking is hugely important. Investment banking is a highly competitive field and building a strong network of contacts will help you make strides in the profession. Attending industry events, reaching out to recruiters, and connecting with current investment bankers on LinkedIn are all effective ways to build your network and increase your chances of landing a job. ### Education Many investment bankers hold a Master of Business Administration (MBA) or another advanced degree, while others have certifications such as the Chartered Financial Analyst (CFA) designation. It's important to research the requirements for your desired position and pursue the necessary education or certifications to increase your chances of success. --- ## **7\. Private equity** Private equity is a popular FP&A exit opp because of its challenging and dynamic nature. This field involves analyzing potential investments, developing financial models, and conducting due diligence on potential acquisitions. As a private equity professional, you'll work closely with investors to manage their portfolios, identify growth opportunities, and generate returns on their investments. If you have a strong understanding of finance and business operations, along with excellent analytical and communication skills, private equity may be a great fit for you. However, it's important to note that it’s another competitive field requiring a strong work ethic and the ability to work well under pressure. Here are a few things that’ll help you transition from FP&A to private equity: - A solid understanding of [financial modeling](https://www.financealliance.io/build-a-saas-financial-model/) and analysis. - Experience with complex financial data. - Feeling comfortable working with teams of professionals from a range of backgrounds. - Participating in networking events (in-person or online) to help build relationships with investors, portfolio managers, and other industry professionals. - Additional education or certifications, such as the Chartered Financial Analyst (CFA) designation. --- [Your ultimate guide to FP&A | Finance AllianceWelcome to the complete guide to financial planning and analysis (FP&A), covering everything you need to know to become a pro at one of the most sought-after roles in finance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/FA_website_hub_meta_drivers_of_success.jpg)](https://www.financealliance.io/your-ultimate-guide-to-fp-a/) --- ## **8\. Venture capital** As a venture capitalist, you’ll work closely with start-up companies to provide them with the funding they need to get off the ground. You will also help these companies develop their business strategies, build their teams, and scale their operations. To succeed in venture capital, you'll need strong analytical skills and a keen eye for identifying promising investment opportunities. You'll also need to be comfortable with taking calculated risks, as not all investments will pay off. Here are some tips for moving into the venture capital field: - Develop a strong understanding of the startup ecosystem and the various stages of funding. - Build a network of contacts in the startup community, including founders, entrepreneurs, and investors. - Seek out opportunities to gain hands-on experience in venture [capital](https://www.financealliance.io/multiple-on-invested-capital-moic/), such as internships or part-time roles at venture capital firms. - Attend pitch events and competitions to see firsthand how startups pitch their ideas and how investors evaluate opportunities. - Stay up-to-date on [emerging technologies](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) and trends that may impact the startup industry. - Consider pursuing advanced education, such as an MBA or a degree in entrepreneurship, to gain a deeper understanding of venture capital and entrepreneurship. - Develop strong analytical and research skills to identify promising investment opportunities and conduct due diligence on potential investments. - Be comfortable taking calculated risks and be able to think creatively to find solutions to challenges that arise in the startup world. --- [Chief Investment Officer vs Chief Financial OfficerChief Investment Officer (CIO) vs Chief Financial Officer (CFO) - they’re two very important C-suite roles, and while they may seem similar at face value, these roles are completely different.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/04/chief-investment-officer.jpg)](https://www.financealliance.io/chief-investment-officer-vs-chief-financial-officer/) --- ## **9\. Portfolio management** Portfolio management is another area of finance that FP&A professionals may find interesting. In this role, you'll be responsible for managing a portfolio of investments and ensuring that they meet the client's financial goals. This requires a strong knowledge of financial markets and investment strategies, as well as excellent communication and relationship-building skills. To transition into portfolio management, you’ll need a deep understanding of financial markets, investment strategies, and [asset allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). A strong background in financial modeling and analysis is also important, as portfolio managers are responsible for making investment decisions based on complex financial data. This shouldn’t be a bother for you though since you already have experience in FP&A, which involves similar skill sets. Additionally, excellent communication and relationship-building skills are critical for success in portfolio management. You'll need to be able to explain investment decisions to clients and build trust with them over time. Portfolio management requires a strong focus on risk management and a willingness to make difficult investment decisions in the face of uncertainty. Successful portfolio managers are proactive and continually seek out new investment opportunities that align with their client's goals and risk tolerance. --- ## **Where can you go after FP&A?** As you can see, there are many different paths you can take as an [FP&A ](https://www.financealliance.io/your-ultimate-guide-to-fp-a/)professional. Whether you're interested in teaching and mentoring, entrepreneurship, investment banking, private equity, or portfolio management, each of these paths offers unique challenges and rewards. The key to success in any of these fields is a strong work ethic, a willingness to take calculated risks, and a passion for learning and growing. You have valuable skills and experience as an FP&A professional, and by pursuing one of these FP&A exit opportunities, you can take your career to new heights and make a significant impact in the world of finance. Remember, the path to success is not always a straight line. It may take some time, effort, and even some setbacks to reach your destination, but with persistence and a positive attitude, you can achieve anything you set your mind to - including succeeding at any one of these FP&A exit opportunities. --- ### FP&A exit opps: Honorable mentions Aside from those mentioned above, there are other FP&A exit opps open to you. So, here are a few honorable mentions: - Business development - Risk management - Financial analysis - Commercial banking - Financial technology (FinTech) - Corporate finance and strategy - Treasury - Controller - Digital finance transformation --- ### FAQs: What's next after FP&A? What is the next step after FP&A? After gaining experience in FP&A, the next step in your career can vary based on your interests and goals. Some common paths include corporate strategy, where you'll help shape a company's long-term direction; corporate development, which focuses on mergers, acquisitions, and strategic partnerships; or progressing to a finance manager role, responsible for overseeing a team and driving financial performance. Additionally, you may consider transitioning to related fields like investment banking, private equity, or consulting, which value the analytical and financial modeling skills developed in FP&A. Ultimately, your next step should align with your desired career trajectory and skill development. How do I move out of FP&A? Transitioning from FP&A depends on your desired career path. You can aim for senior FP&A positions or specialize in areas like budgeting or financial modeling. If you're interested in a different field, your strong analytical and communication skills can be valuable in Strategy, Marketing, or Consulting. What are the exit opportunities for financial analysts? Financial analysts have a wide range of options. You can leverage your financial modeling expertise for roles in Corporate Finance or Investment Banking. Business Analyst, Product Manager, or Pricing Analyst positions can utilize your financial acumen and business understanding. With additional training, data-driven careers like Business Intelligence Analyst or Data Scientist are also possibilities. Can I go from FP&A to banking? Absolutely! Your FP&A experience provides a strong foundation in financial modeling, a key skill for investment banking. An MBA or relevant certifications can further strengthen your candidacy. Can I move from FP&A to consulting? The problem-solving, data analysis, and communication skills honed in FP&A are highly valued in consulting firms. Highlighting your project management experience and networking within consulting can help you make the switch. What's next after FP&A? The beauty is that there's no single "next" after FP&A. It depends on your goals. You can pursue a leadership role within FP&A, transition to a related area like Corporate Finance, or leverage your skills for a completely different path. --- ### **FP&A Core Certified: Drive strategic business and career growth with FP&A** Take your career to the next level with our [FP&A Core course](https://certified.thealliance.io/course/fpa-certified-core). Learn to forecast, budget and turn complex data into insights that drive profitable business growth. This course is your comprehensive guide to mastering FP&A, including insights, case studies, and practical templates you won't find elsewhere. **Enjoy:** - **5+** hours of content - **Actionable** coursework tasks - **Bespoke** templates & frameworks - **Expert** insights - **100%** self-paced - **Official** certification [Find out more](https://certified.thealliance.io/course/fpa-certified-core) ### Earnings credit rate (ECR) formula & breakdown URL: https://www.financealliance.io/earnings-credit-rate-ecr/ Last updated: 2024-05-28T11:28:09.000Z Account maintenance, wire transfers, check processing...they all add up. And the more you use bank services like this, the *higher* the charges. But what if you could recoup some of those costs? Thankfully, there’s a way to offset these types of costs and that’s with the earnings credit rate (ECR). In this blog post, we'll explain what the ECR is, how it works, and how businesses use it to their advantage. --- ### Topics covered: - [Earnings credit rate definition](https://www.financealliance.io/p/f4cf2184-0447-4866-a715-6b9da8955f4f/#what-is-the-earnings-credit-rate) - [How it works](https://www.financealliance.io/p/f4cf2184-0447-4866-a715-6b9da8955f4f/#how-does-it-work) - [Earnings credit rate formula](https://www.financealliance.io/p/f4cf2184-0447-4866-a715-6b9da8955f4f/#earnings-credit-rate-calculation-formula) - [ECR vs. hard interest](https://www.financealliance.io/p/f4cf2184-0447-4866-a715-6b9da8955f4f/#ecr-vs-hard-interest) - [How ECR can positively impact your business](https://www.financealliance.io/p/f4cf2184-0447-4866-a715-6b9da8955f4f/#how-ecr-can-positively-impact-your-business) - [Limitations of ECR](https://www.financealliance.io/p/f4cf2184-0447-4866-a715-6b9da8955f4f/#limitations-of-ecr) - [Common FAQs](https://www.financealliance.io/p/f4cf2184-0447-4866-a715-6b9da8955f4f/#faqs-ecr) --- ## **What is the earnings credit rate?** The earnings credit rate is an interest rate the bank applies to your average daily balance. However, it’s *not* the same as a traditional savings account where you may see some interest accumulate each month. Instead, your bank uses that calculated ‘interest’ to offset the service charges you incur for things like check processing, wire transfers, and [account maintenance](https://www.financealliance.io/fp-a-vs-accounting-key-differences-every-finance-pro-should-know/). 💡 If you hold large deposits, you’ll likely pay lower bank service charges. ## **How does it work?** The earnings credit rate is used to reward businesses for keeping money in the bank. It’s an internal [calculation](https://www.financealliance.io/how-fp-a-teams-calculate-and-reduce-customer-churn/) that translates to a credit applied to your account. Here’s how it works: **1\.** The bank applies the ECR to your average daily balance over a specific period (often monthly). **2.** They take that balance and multiply it by the ECR percentage to get an earnings credit dollar amount. **3.** This credit is then used to offset service charges like maintenance fees, transaction fees, or other account-related expenses. Let’s bring this into the real world for a moment. Say that a company maintains an average balance of $1 million for the month. Now, let’s assume the earnings credit rate is 0.5%. In this case, the earnings credit would be $5,000 (0.5% of $1 million). If the earnings credit covers all the fees, *great!* If not, you (*as in the company*) must pay the remaining amount owed to the bank. In some cases, any excess credits may carry over to the following month. --- [Multiple on Invested Capital (MOIC): Definition & guideIn this article, we’re zeroing in on MOIC to uncover what it is, its role in private equity, and more importantly, how you can use it to sharpen your investment evaluation skills.r![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/03/MOIC.jpg)](https://www.financealliance.io/multiple-on-invested-capital-moic/) --- ## **Earnings credit rate calculation (formula)** The basic earnings credit rate formula is: > **Earnings Credit = Average Daily Balance × Earnings Credit Rate × Number of Days in the Period / 365** This formula gives the total earnings credit in monetary terms for that month, which can then be used to offset the fees. For example, if your business: - Has an average balance of $10,000 in its account - Owes $50 in service charges ...*and* your bank’s ECR is 0.5% per year, here's how you’d calculate the earnings credit: > **Monthly earnings credit = $10,000 × 0.005 × (30/365) ≈ $4.11** As you can see, it’s not a huge amount of savings. And since the earnings credit of $4.11 is less than the service charges of $50, you’d still owe $45.89 in fees *after* the credit is applied. ECR rewards businesses that keep higher balances with reduced banking costs. Essentially, you get a discount on services by keeping your own funds on hand. --- ## **ECR vs. hard interest** There’s often a lot of confusion and mix up between the earnings credit rate and hard interest. The main difference between the two comes down to *where* the benefit of each goes. Below, we look at the main difference between ECR vs interest by looking at their purpose, calculation, and usage. ### **Earnings credit rate (ECR):** ![Earnings credit rate (ECR)](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/earnings-credit-rate.png) ### **Hard Interest:** ![Interest vs earnings credit rate differences](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/interest.png) ### **In a nutshell:** ECR ***saves*** you money on fees. Interest ***earns*** you money. --- ## **How ECR can positively impact your business** Now that we’ve covered the concept of ECR, let's get into the best ways it can help boost your company’s bottom line: ### **1\. Reduces banking costs** The main benefit of ECR is that it helps reduce the monthly fees your business pays for its banking services like: - Account maintenance - Transaction fees - Returned check fees - Minimum balance fees The credits earned are used to offset these fees, helping you to save money (even if it’s not always a huge amount). ### **2\. Encourages larger balances** Think of ECR like a rewards program, but instead of points for buying stuff, you get rewarded for keeping more money in your business account. The more you typically keep on hand (average daily balance), the more "credits" you earn. By keeping a higher balance, you make sure you have enough funds for daily operations *without* getting hit with those service fees. ### **3\. Flexibility in cash flow management** With reduced or offset fees, businesses can have more predictable banking costs, which helps in budgeting and [financial planning](https://www.financealliance.io/the-financial-planning-analysis-chasm/). Not to mention, it helps to free up cash that would otherwise go towards fees. You can then reinvest this [cash flow](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/) *back* into your business, whether it's for strategic growth initiatives, new equipment purchases, or simply building a healthier financial cushion. ### **4\. Improved financial efficiency** With the savings from reduced fees, you can [allocate funds](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) more efficiently across your [business operations](https://www.financealliance.io/business-process-optimization/). This might mean more resources for marketing, inventory, hiring, or other strategic investments. By leveraging ECR to reduce fees, you can gain more control over your financial resources. With this newfound flexibility, you can be a lot more strategic with your investments and focus on areas that align with your company's growth goals. ### **5\. Increased transparency** Another key benefit of ECR is that it gives you a clear picture of your business finances. The [Corporate Finance Institute](https://corporatefinanceinstitute.com/resources/valuation/earnings-credit-rate-ecr/#:~:text=Benefits%20of%20the%20ECR&text=The%20ECR%20reduces%20bank%20service,%E2%80%93%20eventually%20increasing%20shareholders'%20value.) noted the increased transparency you can gain when combining “*demand deposit accounts (DDAs) with the applicable ECR provide transparency in managing cash.*” This is because things like the balance information plus all transaction and fee details are readily accessible and included in your monthly account statements. --- [5 tips to promote financial accountability across the companyLooking after the company’s money is a shared responsibility that needs diligence, transparency, and accountability from all levels of the organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/financial-accountability-1.jpg)](https://www.financealliance.io/financial-accountability/) --- ## **Limitations of ECR** While ECR can offer several benefits for businesses, there are also some limitations to keep in mind: ### **Different ECR rates** The calculation of ECR varies from bank to bank. Big players like money center banks often target businesses with lower average balances by offering them more attractive ECR rates. This strategy aims to attract a wider pool of customers. On the other hand, regional banks tend to focus on businesses that maintain higher average balances. They reward these loyal customers with more generous ECR rates. With so much variation, it can be difficult and time-consuming to compare options and plan accordingly. ### **Limited to certain fees** Depending on your bank, ECR typically applies only to transactional and maintenance fees. This means that feed like overdraft charges, loan interest rates, or fees for special services, may not be covered by the earnings credits. ### **Non-cash benefit** Think of ECR credits like coupons you earn for keeping a higher balance. These coupons help reduce your bank fees, but they don't turn into *actual* cash. If your fees are lower than the credits you earn in a month, those extra credits usually can't be carried over or withdrawn. It's all about using them to get the most out of your banking services. ### **Requires high balances** As we’ve mentioned, the higher your balance, the most you’ll gain from ECR. This might not be realistic for every business, especially smaller companies with limited cash flow or those with seasonal fluctuations in their income. Smaller businesses might struggle to keep a consistently high balance due to operational needs and limited resources. And if you’re a business with fluctuating cash flow, you might also find it difficult to maintain a high average balance throughout the year. --- ## FAQs: ECR What are ECR payments? ECR payments are not direct payments but rather credits applied to an account to offset monthly service charges. They are calculated based on the average balance in the account and the agreed-upon ECR rate. How does the earnings credit rate work? The earnings credit rate works by providing credits based on the average balance maintained in a commercial account. These credits can then be used to offset or reduce the service charges associated with the account, effectively lowering banking costs for businesses. What is the earnings credit rating? The Earnings Credit Rate (ECR) isn't quite a rating, but rather a percentage rate used by banks to calculate a kind of discount on your business banking fees. What is an example of earnings credit rate? An example of an earnings credit rate in action would be a business account with an average monthly balance of $50,000 and an ECR of 0.5% annually. If the bank charges $200 in monthly fees, the earnings credit for that month would be approximately $20.83, reducing the fees payable to $179.17. What is the average ECR rate? The average ECR rate can vary significantly between banks and is influenced by factors such as market interest rates and the bank's policies. Generally, ECR rates range from 0.10% to 1.00% per year, depending on the bank and the economic conditions. What is the ECR ratio? The ECR ratio refers to the ratio of the earnings credit given to the fees generated by the account. It is a measure of how effectively the earnings credit offsets the account's monthly fees. ## --- ### **Unlock your potential with Pro Membership** Streamline your processes, expand your knowledge, and elevate your finance career to unprecedented heights with our Pro Membership. Join a community of driven professionals who share your passion for excellence, and gain access to a wealth of resources, including: - Cutting-edge templates and tools to optimize your daily workflows - Trustworthy, up-to-date insights from industry experts - A supportive network of peers to share ideas and best practices Don't settle for anything less than the best. Invest in your future today and experience the transformative power of [Pro Membership](https://www.financealliance.io/pro-membership/). [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/1-1.png) ](https://www.financealliance.io/pro-membership/) ### Future-proof your forecasting: Strategies for navigating uncertainties URL: https://www.financealliance.io/future-proof-your-forecasting-strategies/ Last updated: 2025-04-07T09:58:24.000Z This article comes from the panel discussion, ‘*Navigating uncertainties in financial forecasting - Insights, Challenges, and Strategies*’, at our **2024 San Jose FP&A Summit**. --- Let's face it: In today's volatile business world, accurately forecasting financial performance is becoming both more essential and more difficult by the day. Unpredictable curveballs and uncertainties can knock even the most carefully crafted forecasts way off course before you know it. Luckily, in this article, we’ll dive into some of the expert insights our recent panel of seasoned finance pros shared on navigating the challenges of financial forecasting. The panel featured some serious heavy-hitters: - **Gabriela Gutierrez**, Founder of **Stealth Startup** - **Chidi Nwosu**,Director of Value Added Services FP&Aat **Visa** - **Jenifer Grocock**,VP of Corporate Financeat **Teradata** - **Harout Sahakian**,Director of FP&Aat **Airgas** With decades of combined experience under their belts across a diverse range of industries, this panel brought invaluable perspectives to the table on key topics like [leveraging data](https://www.saasalliance.io/leveraging-data-to-build-a-great-product/), scenario planning, implementing [forecasting models](https://www.financealliance.io/podcast/financial-forecast-model/), and managing risks. So, let’s dissect! ## **Leveraging data for accurate forecasting** ### In this era of data, utilizing information effectively has become absolutely critical for accurate financial forecasting. As Gabriela Gutierrez put it, > "*Every company needs to establish a data pipeline process and partner closely with technical teams to truly understand what the data is telling you.*" She stressed the importance of clean data and smoothly integrating different data sources into your financial models. Chidi Nwosu wholeheartedly agreed, underlining the need to know your business's core drivers inside and out. > *"It's really important to know the business if you're in FP&A. For example, at Visa, the biggest driver is authorizations – billions of transactions happening globally. By analyzing data around authorizations, spending patterns, and external factors (like the economy and weather), we can gain valuable insights."* Jenifer Grocock shared how, at Teradata, they created a "*financial data warehouse*" - a centralized database for clean, consistent financial data collected from various systems across the company. She explained, > "*The most important thing about data is ensuring it's clean and that various systems have the same data.*" Harout Sahakian, whose team handles dashboard building and automation, cautioned against letting reports and dashboards get out of hand: > "*You can be overloaded with how many you have. Focus on the ones that business leaders need, then free up capacity to take you to the next level with data management.*" _This post is for paying subscribers only._ ### Acquisitions: 6 proven negotiation tactics to seal the deal URL: https://www.financealliance.io/acquisitions-6-proven-negotiation-tactics/ Last updated: 2025-10-15T11:48:30.000Z Time is money, *especially* when it comes to [acquisitions](https://www.financealliance.io/acquisition-financing/). Deal fatigue can drag negotiations on for months and every day a deal remains unclosed is another day of lost opportunities and unrealized profits. But that’s only the case if you *don’t* know how to leverage negotiation tactics to your advantage. By the time you finish reading this guide, you’ll know some of the best secrets of the trade to help you gain an advantage at the negotiation table and close deals quicker. --- ### **Negotiation strategies:** [1\. Preparation and research](https://www.financealliance.io/p/1eb9bc1f-5904-4a78-8f67-beb518c89d6e/#1-preparation-and-research) [2\. Build trust](https://www.financealliance.io/p/1eb9bc1f-5904-4a78-8f67-beb518c89d6e/#2-build-trust) [3\. Be an active listener](https://www.financealliance.io/p/1eb9bc1f-5904-4a78-8f67-beb518c89d6e/#3-be-an-active-listener) [4\. Identify the ‘real’ decision-maker](https://www.financealliance.io/p/1eb9bc1f-5904-4a78-8f67-beb518c89d6e/#4-identify-the-main-decision-maker) [5\. Use the framing method](https://www.financealliance.io/p/1eb9bc1f-5904-4a78-8f67-beb518c89d6e/#5-utilize-the-framing-effect-method) [6\. Win-win paradigm](https://www.financealliance.io/p/1eb9bc1f-5904-4a78-8f67-beb518c89d6e/#6-win-win-paradigm) --- ## **1\. Preparation and research** Acquisitions are *massive* investments, and protracted negotiations can bleed your company dry. For that reason, you *must* put the time and work in to make sure you’re properly prepared for the negotiation phase of the acquisition. Being prepared will help you: - Secure the **desired price** - Navigate **deal structures** - Identify **potential risks** And, most importantly, it’ll put you in a stronger position to maximize value for the company. ![](https://media.tenor.com/HEnh1nSTPwcAAAAC/seinfeld-negotiate.gif) [82% of top performers](https://www.scotwork.co.uk/thought-leadership/negotiation-statistics/) (those exceeding their quotas) say they "always" perform research *before* reaching out to [prospects](https://www.salesenablementcollective.com/the-role-of-bdrs-sdrs-vs-account-executives/). For CFOs, this means doing due diligence and looking into things like the target’s financials and identifying their strengths, weaknesses, and any hidden liabilities. With this knowledge, you can negotiate confidently, ensuring you get the best possible deal. But successful acquisitions aren't just about maximizing your own gain. Researching the target's situation and industry trends allows you to anticipate potential counter-offers. This foresight will help you formulate the best responses and navigate negotiations better. Remember, the most successful acquisitions create value for **both* parties. So, make sure you understand the target's needs and tailor your proposal to address their specific pain points. Finally, don't underestimate the power of a structured process. [Huthwaite International's](https://www.huthwaiteinternational.com/) research found that companies lacking a clear negotiation strategy suffered an average net income decline of **63.3%**. A well-defined roadmap keeps you focused, prevents costly missteps, and increases the odds of securing a deal that creates value for both your company *and* the target (or vice versa). --- ## **2\. Build trust** The saying "*people buy from people they like and trust*" holds true not just in sales, but also in acquisitions. [HubSpot](https://blog.hubspot.com/sales/hubspot-sales-strategy-report?hubs%5Fcontent=blog.hubspot.com%2Fsales%2Fsales-statistics&hubs%5Fcontent-cta=HubSpot) reports that **82%** of sales professionals consider building relationships the most crucial (and enjoyable) aspect of their work. This translates directly to acquisitions where building trust with the target company is *key* to smooth negotiations. By building trust, you can allow for open communication where exchanging information flows better without hitting as many roadblocks. When both sides trust each other, it helps to create transparency, which leads to confidence, and more productive negotiations. So, how can you build trust? A good place to start is by demonstrating genuine interest in the target company and its goals. You should also be open and transparent about your own company’s objectives and limitations. If you hide something important and it pops up down the road, you risk breaking the trust you’ve spent so long building. The best way forward is to be open and honest, which can go a long way in building trust and securing a lasting deal. --- [10 risks of mergers and acquisitions & how to mitigate themIn this article, we explore the top 10 risks of acquiring a company and how to mitigate them.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/mergers2.jpg)](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) --- ## **3\. Be an active listener** Active listening isn't just about hearing the words; it's about fully *absorbing* the message. It might sound easy in theory, but it can be difficult to maintain and showcase interest, especially in drawn-out negotiation conversations. CFOs who prioritize active listening gain a deeper understanding of the target company's needs and position themselves to craft win-win deals that benefit both parties. Here are some useful tips to help you practice active listening: ![CFO negotiation tactics - active listening tips](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/cfo-negotiation-tactics.png) Negotiation isn't just about getting the best deal; it's about building bridges. When you truly listen to the other side (and their needs and concerns) you create a sense of respect and understanding. *That* makes all the difference in an acquisition. People want to feel heard and valued, and active listening shows them you care. It might sound simple, but it can be one of the best negotiation tactics that turns a tense deal into a win-win for everyone involved. --- ## **4\. Identify the main decision-maker** A key part of any negotiation is doing some detective work to avoid a common mishap. Imagine this, you're in the middle of negotiations, you’ve come prepared, you’ve done your research and you’re ready to make the deal. The problem though, is the person you’re negotiating with lacks the authority to make any real decisions, never mind closing the deal. The result? Frustration, wasted time, and *a lot* more back and forth down the road. ![](https://media.tenor.com/fEgWYExhPXUAAAAC/anxious-pacing.gif) To avoid this from happening, [Forbes](https://www.forbes.com/sites/allbusiness/2020/08/21/guide-to-succeeding-in-business-negotiations/) suggests you find out what kind of authority the other person has. In other words, are they the ultimate decision-maker? Or are they acting as the voice of the company, but lacking true authority? That leads us onto the *next* hurdle - how do you go about identifying the [real decision-maker](https://www.financealliance.io/become-a-data-driven-decision-maker-dddm-part-1/)? The obvious answer is to ask. It’s best to do this early in the conversation to find out more about the other person’s role and decision-making authority. You could ask something like “*Who will ultimately approve this agreement?*” or “*If we reach an understanding, who will I need to discuss it with for final approval?*" – these types of questions will help you get a straight answer a lot faster. > *“Negotiations tend to go on for too long when direct questions aren’t asked. Open up discussions to get both sides on the same page.”* \- [Mara Garcia, CFO of Phonexa](https://www.forbes.com/sites/forbesfinancecouncil/2023/07/24/3-effective-negotiation-strategies-cfos-can-leverage-for-great-success/). If you don’t want to take that approach straight away, there are some other ways you can identify the key decision makers *without* asking them outright. For example, take time to research the target company's structure (and do this *before* the negotiation). You can look at [tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/) like LinkedIn to understand the hierarchy and identify key decision-makers. You can also often tell when someone lacks the authority to make final decisions by keeping an eye out for some early signs. You might notice that the person you’re negotiating with says things like "*I can't agree to that*" or "*I need to run this by my manager*" repeatedly. These types of phrases are clear signals they lack the final say. Another giveaway is if the person avoids specific deal points or seems uncomfortable discussing certain aspects, which may suggest they need higher-level approval. --- [32 powerful CFO KPIs to measure and masterThis guide covers some of the most important CFO KPIs to track. First, we’ll look at the ones that’ll give you a solid overview of the company’s financial health and performance. Then, we’ll move into the metrics used to measure your performance as the finance leader of the company.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/CFO-KPIs.jpg)](https://www.financealliance.io/32-cfo-kpis/) --- ## **5\. Utilize the framing effect method** Have you ever noticed how the way someone presents information can completely change your perspective? That's the power of the framing effect, which is a cognitive bias you can actually use to your advantage during negotiations. Take this image for example. ![Negotiation strategies](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/framing-effect-example-.jpeg) **Do you see a rabbit or a duck?* You’ve probably seen it before. It's a great example of how perceptions change according to how it’s presented and your own perception. [Neil Patel](https://neilpatel.com/blog/negotiator/) talked about how you can use this principle as a negotiation tactic: > *“Ask yourself, “How can I frame this solution so we both win?”* > *“Keep in mind that you are not necessarily changing the end result. You are simply changing the way you frame the conversation.”* **Neil Patel, co-founder of NP Digital.** For a CFO working on closing an acquisition deal, you could take the framing effect, which suggests people react to a particular choice in different ways depending on whether it’s presented as a loss or a gain, as one of your best negotiation strategies. For example, you could highlight the possible benefits of an acquisition to create a more favorable perception compared to focusing on the drawbacks or [risks involved](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/). Some other ways you could use this principle in your negotiation include: ### **Use comparisons** Comparing your offer to competitors can be a smart way to make the benefits more tangible. ****Example:** "**By acquiring this company, we will outperform our closest competitor by 20% in market share*." ### **Tailor your message** Frame your message to align with what each [stakeholder](https://www.financealliance.io/stakeholder-communication-plan/) values most. ****Example:** If you’re talking to another finance professional, you can emphasize cost savings and [revenue growth](https://www.financealliance.io/saas-finance-strategies/). On the other hand, if you’re conversing with a marketing officer, you could highlight market expansion and brand synergy. ### **Focus on immediate gains** During acquisition negotiations, focus on the "what's in it for them" factor. People tend to prefer immediate rewards over future benefits. ****Example:** Highlight any tangible and immediate benefits the acquisition will bring them such as new revenue streams, new markets, technology, etc. --- ## **6\. Win-win paradigm** The win-win paradigm is one of the most effective negotiation strategies that focuses on finding solutions that benefit everyone involved. In acquisition deals, this philosophy proves particularly valuable because it helps to build: - Stronger relationships - Smoother collaboration - Sustainable success According to Adam Webb from Sunder Energy (*as quoted in this Forbes article on* [*the art of negotiation*](https://www.forbes.com/sites/forbesbusinessdevelopmentcouncil/2022/10/31/the-art-of-negotiation-15-tips-for-business-leaders-to-master/)): > *“The win-win paradigm is the key to all successful negotiations, so infuse it into your being. Lay the foundation by discussing it at the start of every sales pitch and negotiation.”* If you want to take this approach, take time to understand the goals, concerns, and interests of the other party. This will help you to come up with better solutions that address their needs as well as your own. > *“Many people think in terms of either/or: either you’re nice or you’re tough. Win-win requires that you be both. It is a balancing act between courage and consideration.” -* [*FranklinCovey*](https://www.franklincovey.com/the-7-habits/habit-4/#:~:text=Win%2Dwin%20is%20a%20frame,are%20mutually%20beneficial%20and%20satisfying.) The win-win approach goes *beyond* short-term success. CFOs who embrace it pave the way for lasting, productive partnerships. These partnerships drive long-term growth and success for both companies involved. --- ## FAQs Why is active listening important in negotiations? Active listening is crucial in negotiations because it allows you to fully understand the other party's interests, concerns, and underlying motivations. What does BATNA stand for? BATNA stands for "Best Alternative to a Negotiated Agreement." It's basically your Plan B – what you'll do if the negotiation falls through. Having a strong BATNA gives you confidence and prevents you from settling for a bad deal. What is anchoring in negotiation? Anchoring is the first number thrown out in a negotiation. It sets a reference point for future offers. What are the tactics of negotiation? Negotiation tactics are tools you use to influence the other side. This can include things like active listening, using your BATNA, positively framing the deal, and making counteroffers. What is the number one rule in negotiation? Know your walk-away point. Be clear on the minimum acceptable terms for you, and be prepared to walk away if you don't get them. What is negotiated acquisition? A negotiated acquisition is when two companies agree on the terms of a merger or acquisition through discussion and compromise. How to negotiate a merger and acquisition? Negotiating a merger and acquisition involves carefully valuing the target company, structuring the deal terms (cash, stock, asset vs stock purchase, etc.), conducting thorough due diligence, and aligning leadership teams and company cultures. What is the role of the CFO in acquisition? The CFO usually investigates the target company's finances, crafting financial models to assess value, and then negotiates key terms with the seller. After the deal closes, they ensure a smooth financial integration, making sure the acquisition delivers on its promise. --- ## Finance Alliance Pro Membership Our **Pro Membership** offers a unified source of trustworthy value for finance professionals to gain new knowledge and access templates and tools to help you optimise your daily activities and skyrocket your finance career to new heights. This membership plan helps you to gain access to the most recent resources, and a supportive community of peers who share your passion for achievement. Learn more about our [Pro Membership here](https://www.financealliance.io/pro-membership/). [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/1-1.png) ](https://www.financealliance.io/pro-membership/) ### 32 powerful CFO KPIs to measure and master URL: https://www.financealliance.io/32-cfo-kpis/ Last updated: 2025-04-14T09:16:38.000Z These days, being a CFO is about *way* more than just reporting on finances. Yes, tracking cash flow, planning budgets, and letting everyone know how the company is performing financially is still a core part of the role. But CFOs are also key players in mapping out the strategies and plans of action to *hit* those financial targets. As a CFO, you've got to be clear on which specific metrics and KPIs give you the best snapshot of how the business is doing. And we're talking KPIs at two levels here: 1. 🏢 The **company-wide** **financial KPIs** that show overall money performance. 2. 🧍🏽**Personal KPIs** for you as the CFO to gauge how effectively you're doing your job. This guide covers 32 of the most *important* CFO KPIs to track. First, we’ll look at the ones that'll give you a solid overview of the company’s financial health and performance. Then, we’ll move into the metrics *your* superiors may use to measure your professional performance. --- ### Table of contents - [Company financial performance KPIs](https://www.financealliance.io/p/e4d5b70a-f83e-4dfe-8eb5-d6bdc3cfdab9/#company-financial-performance-kpis) - [CFO KPIs and performance metrics](https://www.financealliance.io/p/e4d5b70a-f83e-4dfe-8eb5-d6bdc3cfdab9/#cfo-kpis-performance-metrics-no2335) - [FAQs](https://www.financealliance.io/p/e4d5b70a-f83e-4dfe-8eb5-d6bdc3cfdab9/#faqs) --- ## Company financial performance KPIs The best way to understand and [assess your company’s financial performance](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/) is by tracking the *right* CFO KPIs. We’ve divided the main ones into four categories: 1. **Revenue and profitability**: These KPIs track your [company’s revenue](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/) and the profitability generated from it. 2. **Operational:** Use these to assess how well your company is managing operations and controlling costs. 3. **Financial efficiency:** These look at how efficient your company is at leveraging assets to generate profits. 4. **Liability:** You can use these metrics to analyze how well your company manages debt, payroll, and [equity financing](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/). Below, we’ll describe the KPIs that CFOs commonly measure across each of these four categories. You can then use this breakdown to help decide which metrics you want to use to evaluate the financial position of your company. ***Note**: **Some of these may overlap and fit into another category just as easily. So, use your best judgment according to how you want to evaluate your company’s financial performance.* ## Revenue and profitability Revenue and profitability KPIs track the company's overall financial health and growth. These assess its ability to generate income, identify areas for cost optimization, and make informed decisions regarding things like pricing strategies, [resource allocation](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), and growth initiatives. ### **1\. Revenue growth rate** Measures the increase or decrease in a company's revenue over some time. ***Revenue growth rate** **\= (Current period revenue - Prior period revenue) / Prior period revenue x 100* ### **2\. Gross profit margin** Shows the percentage of revenue remaining after deducting the cost of goods sold (COGS). ***Gross profit margin** *\= (Revenue - Cost of goods sold) / Revenue* ### **3\. EBITDA** This measures profitability by considering earnings before interest, taxes, depreciation, and amortization. ***EBITDA** *\= Net income + Interest + Taxes + Depreciation + Amortization* ### **4\. Compound annual growth rate (CAGR)** Calculates the annualized growth rate over multiple periods. ***CAGR** *\= (Ending value / Beginning value)^(1/no. of periods) – 1* ### **5\. Revenue variance analysis** Breaks down the difference between actual and budgeted revenue, identifying areas of under or even *over-performance*. ***Revenue variance** *\= Actual revenue – Budgeted revenue* ### **6\. Return on assets (ROA)** Reveals how efficiently a company generates profits from its assets. ***Return on assets** *\= Net income / Total assets* ### **7\. Net profit margin** Shows how much net income a company earns per dollar of revenue. ***Net profit margin** *\= (Net income / Revenue) x 100* ### **8\. Earnings per share** Calculates the portion of a company's profit allocated per outstanding share of stock. ***Earnings per share** *\= (Net income - Preferred dividends) / Average outstanding shares* --- ## Operational Operational KPIs are useful to gauge the efficiency and effectiveness of the company's day-to-day operations. They're used to pinpoint any bottlenecks, streamline processes, manage working capital, and more. ### **9\. Operating cash flow** Measures cash generated from core business operations. ***Operating cash flow** *\= Operating income + Depreciation - Taxes + Change in working capital* ### **10\. Cash conversion cycle (CCC)** This measures the average time it takes a company to convert its inventory and receivables into cash. ***Cash conversion cycle** *\= Days inventory outstanding + Days sales outstanding - Days payable outstanding* ### **11\. Accounts payable turnover** Indicates how many times (per a specific period) a company *pays* its accounts payable. ***Accounts payable turnover** *\= Cost of sales / Average accounts payable* ### **12\. Accounts receivable turnover** Shows how many times per period a company *collects* its accounts receivable. ***Accounts receivable turnover** *\= Net credit sales / Average accounts receivable* ### **13\. Budget variance** Compares actual performance and costs against what was budgeted. ***Revenue budget variance** *\= (Actual revenue-budgeted revenue)/ Budgeted revenue* --- ## Financial efficiency Financial efficiency KPIs measure how the company manages its financial resources and can tell you if it's doing so effectively. You'll turn to these KPIs when you want to assess capital structure, evaluate investment opportunities, and ensure optimal utilization of assets and capital to maximize shareholder value. ### **14\. Return on equity (ROE)** Measures profitability by calculating how much profit is generated with shareholders' invested money. ***Return on equity** *\= Net income / Shareholders' equity* ### **15\. Cash runway** Estimates how many months/years a company can continue operating before running out of cash. ***Cash runway** *\= Cash balance / Monthly operating cash burn rate* ### **16\. Days sales outstanding** Shows the average number of days it takes to collect payment after a sale. ***Days sales outstanding** *\= (Accounts receivable /Net credit sales) x Number of days* ### **17\. Days payable outstanding** Calculates the average number of days a company takes to pay its accounts payable. ***Days payable outstanding** *\= (Accounts payable x days in the time period) / Costs of goods sold)* --- ## Liability Liability KPIs are used to help manage the company's debt obligations and financial risk. CFOs use liability KPIs to measure how well the company can meet its short-term and long-term debt obligations. ### **18\. Working capital** This formula measures a company's liquidity and ability to meet short-term obligations with current assets. ***Working capital** **\= Current assets - Current liabilities* ### **19\. Quick ratio** Measures a company's ability to pay current liabilities with its most liquid assets. ***Quick ratio** *\= (Cash + Marketable securities + Accounts receivable) / Current liabilities* ### **20\. Debt-to-equity ratio** Compares a company's total debt to its shareholders' equity to evaluate financial leverage. ***Debt-to-equity ratio** *\= Total debt / Total shareholders' equity* --- [Business process optimization: 5 inefficiencies to eliminate5 process inefficiencies you should try to eliminate. By streamlining these areas, you can create a ripple effect of efficiency gains across the entire company.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/Business-process-optimization.png)](https://www.financealliance.io/business-process-optimization/) --- ## CFO KPIs & performance metrics (No.21 - 32) The CFO KPIs we covered above are to track the company’s financial health. But there’s more to the story than that. As the CFO, you’re not just [measuring company KPIs](https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/). *You're* also measured based on your performance and output as CFO. CEOs and board members use metrics to help measure the performance of their team members, *including* the CFO. By knowing these personal "benchmarks," you can focus on things that'll help you grow in your career. ****Note**: CEOs will likely evaluate you using a mix of quantifiable financial results and qualitative leadership aspects. Here are some key areas they'll be looking at: ### **21\. Financial performance** At the end of the day, the company wants to see if you're delivering results or not. So, expect them to keep a close eye on those CFO key performance indicators that show whether you delivered on the financial targets they set for things like profit margins, cash flow, and [revenue growth](https://www.financealliance.io/saas-finance-strategies/). If those numbers *aren't* where they're supposed to be, you can bet they'll have some questions for you. ![](https://media.tenor.com/yy2cI_EeT-0AAAAC/so-many-questions-dr-roger-bentley.gif) ### **22\. Aligning strategies with company goals** Another area of interest will be if your financial plans line up with the company's bigger goals. For example, did your cost-cutting measures free up resources for growth initiatives? A top CFO must manage financial resources wisely (like optimizing revenue streams and minimizing risks). ### **23\. Leadership and vision** CFOs are often measured based on their [leadership](https://www.financealliance.io/operational-finance/) skills. The company wants to see how well you lead the finance team and whether you have the necessary people skills. Some of your main priorities to help showcase your leadership skills could include things like: - Guiding the team through periods of [change and transformation](https://www.financealliance.io/managing-complex-change-matrix/) - Building a strong team that thrives - Stepping into a mentorship role for junior team members - Communicating with clarity and patience - Leading by example *and* with integrity ### **24\. Problem-solving** Another big thing that leadership will assess when measuring your performance as a CFO is how well you troubleshoot problems. Senior management and the board want to know you're the type to get ahead of financial hiccups, spotting them early and putting a plan in place to deal with them. CEOs *love* a CFO who's always a few steps ahead. So, try to build your problem-solving skills and sharpen your critical thinking skills too. ### **25\. Risk management** The higher-ups know that curveballs can come out of nowhere in any industry. So when things happen unexpectedly, they're counting on *you* to have that sixth sense and see it coming from a mile away. ![](https://media.tenor.com/GV5A4pzkXmEAAAAC/supertroopers.gif) *That's* why they'll be poring over numbers like the debt-to-equity ratio and the company's credit rating. If *those* are looking dicey, it's a sign you might not be staying ahead of potential storms on the horizon. ### **26\. Cash flow management** The company needs to know you can keep the money flowing. So, expect that they'll assess your ability to manage cash flow. This includes making sure there's always enough money for bills, growth, and taking advantage of opportunities. A couple of tips to help keep up: - **Stay on top of your cash flow forecasting**. Having projections mapped out for the next six months or even the year can help you [anticipate any potential cash crunches](https://www.financealliance.io/3-cash-flow-forecasting-challenges/) *before* they happen. - **Don't sleep on your receivables.** You need to stay disciplined about invoicing and collections to keep that revenue stream steady. - **Be strategic about your payables**. Negotiate terms with vendors, but don't stretch payables so far that you end up straining relationships. ### **27\. Capital management** A great CFO isn't just about bringing in the money, it's about using it wisely. Those who'll be assessing your performance want to be sure you're putting money in *all* the right places. So, they'll look at how you allocate capital to different areas. Are you investing in projects that actually have legs to drive real growth? Can you make that dollar stretch further *without* sacrificing quality? These are the type of questions the company will need answers to. ### **28\. Stakeholder management** Being a great CFO isn't just about spreadsheets and bottom lines. It's about building relationships. So, take time to get to [know your stakeholders](https://www.financealliance.io/stakeholder-communication-plan/). Talk *their* language (in other words, try to use *less* finance jargon they may not understand). And, show them you understand their concerns and can explain complex financial matters in a way that makes sense - *that's* the kind of CFO who gets noticed. ### **29\. Budgeting** Seeing if you can allocate resources and ensure teams stay within their budgets is something that'll be closely monitored. This means allocating resources *strategically*, making sure each department has what it needs to succeed *without* going overboard. 💡 ****Pro tip:** Get buy-in from department heads during the budgeting process. Doing so will help you build a more ****collaborative approach** to the budgeting process. ### **30\. Financial reporting** Numbers are important, but stories resonate. CEOs rely on CFOs to [translate financial data](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/) into clear, concise reports. Can you paint a picture of the company's financial health? Do your reports provide valuable insights for decision-making? A proficient CFO can utilize data to communicate the company's financial trajectory to internal and external stakeholders effectively. ### **31\. Forecast accuracy** CEOs value CFOs who can create [*accurate* financial forecasts](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/). They don't expect you to predict the exact future by any means. Still, they want you to use your financial expertise to anticipate trends and potential roadblocks. By providing reliable financial forecasts, you become a strategic partner to the business, helping it navigate the road ahead confidently. ### **32\. Financial accountability** A strong financial foundation requires a team effort. CEOs look for CFOs who can foster a culture of [financial accountability across the company](https://www.financealliance.io/financial-accountability/). Do employees understand the financial implications of their decisions? Can you implement processes to ensure responsible spending? A great CFO empowers *everyone* in the company to be financially responsible. --- ## FAQs: CFO KPIs How is CFO performance measured? CFO performance is usually measured by evaluating different areas of the role, such as how well they manage the company’s financial health and how effectively they contribute to achieving strategic goals. Some top CFO KPIs might include the accuracy of financial forecasting, the speed (and efficiency) of closing financial books, cost management, leadership qualities and more. What are two metrics a CFO should always monitor? The two metrics a CFO should always monitor depends on their industry. However, two really important metrics for the CFO are the Return on Investment (ROI) and Operating Cash Flow. ROI measures the profitability of investments and is crucial for assessing the efficiency of spending. Operating Cash Flow calcualtes the total cash generated by the company’s regular business operations, which is important for evaluating the company's liquidity and its ability to sustain and grow operations. Why are KPIs important in finance? KPIs are crucial in finance because they provide a quantifiable measure of performance and health within a company. How do you measure the success of a CFO? The success of a CFO can be measured through a blend of financial metrics, strategic achievements, and leadership effectiveness. Financially, success might be assessed via growth in revenue, improvement in profit margins, and the company's financial position. Strategically, the ability to contribute to significant business decisions, manage risks effectively, and innovate in financial practices are key markers. Leadership can be evaluated through team performance, retention rates, and the development of strong relationships both internally and externally. What ratios do CFOs use? CFOs often use financial ratios such as the Debt-to-Equity Ratio and the Current Ratio. These help CFOs ensure the company maintains a healthy balance between its obligations and the resources available to meet them. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### How to use GPT-4o in finance (and data analysis) URL: https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/ Last updated: 2025-04-10T07:49:30.000Z OpenAI's newly unveiled GPT-4 Omni (GPT-4o) model promises to change the roles of finance professionals (and others) forever. This advanced language model represents a *major* leap forward in artificial intelligence capabilities, offering improved experiences across text, voice, and vision. > *“This is the first time that we are really making a huge step forward when it comes to the ease of use*,” **Mira Murati, OpenAI Technology Chief.** Some exciting new features include the ability to ask GPT-4o to translate languages using nothing but an image and soon, the ability to have a more natural, ‘*real-time voice conversation and the ability to converse with ChatGPT via real-time video*.’ [OpenAI reports that GPT-4o](https://openai.com/index/hello-gpt-4o/) “*can respond to audio inputs in as little as 232 milliseconds, with an average of 320 milliseconds*”. Impressively, this is very similar to a natural human response time during a conversation. The best part though, is that GPT-4o is available to free users. However, it *will* have some usage limits. Free users can access these features: - Experience GPT-4 level smarts with greater speed. - Get answers combining model knowledge and web info. - Create [charts and visualizations](https://www.financealliance.io/financial-charts-and-graphs/) from data. - Discuss photos you take by uploading them. - Upload files for help with summarizing, writing, or analyzing (*including Excel files*). - Keep conversations on track with built-in memory. --- ### Table of contents - [Introducing GPT-4o](https://www.financealliance.io/p/6966e0aa-99e2-429d-95ef-d1dc37078dab/#introducing-gpt-4o-openai%E2%80%99s-official-update) - [How to upload Excel files and create charts](https://www.financealliance.io/p/6966e0aa-99e2-429d-95ef-d1dc37078dab/#how-to-upload-excel-files-and-create-charts-in-gpt-4o) - [Analyzing financial data in GPT-4o](https://www.financealliance.io/p/6966e0aa-99e2-429d-95ef-d1dc37078dab/#analyzing-financial-data-in-gpt-4o) - [Voice conversations](https://www.financealliance.io/p/6966e0aa-99e2-429d-95ef-d1dc37078dab/#voice-conversations) - [Desktop app – GPT-4o](https://www.financealliance.io/p/6966e0aa-99e2-429d-95ef-d1dc37078dab/#desktop-app-%E2%80%93-gpt-4o) - [FAQs](https://www.financealliance.io/p/6966e0aa-99e2-429d-95ef-d1dc37078dab/#faqs) --- ## **Introducing GPT-4o (OpenAI’s official update)** **OpenAI's official introduction to GPT-4o \[*[**Source: YouTube*](https://www.youtube.com/watch?v=DQacCB9tDaw)**\]* Alright, all that sounds great. But let’s get into the reason you’re here – to learn how GPT-4o can be used in finance and [data analysis](https://www.financealliance.io/microsoft-fabric-for-data-analysis/). Let’s get into it.👇🏼 ## How to upload Excel files and create charts in GPT-4o ### **1\. Upload Excel spreadsheet files** You can now upload Excel, CSV, and other files *directly* to GPT-4o. No more copying and pasting data from your file into ChatGPT. Now that you can upload your files directly, it makes the entire process of analyzing complex data sheets a lot easier and less time-consuming. You can also upload other files like documents, PDFs, and more. To upload an Excel file (or any file) to GPT-4o, simply click the paperclip icon on the bottom left corner of your screen: ![How to upload files to GPT-4o](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/How-to-upload-files-to-GPT4.png) Once you've clicked it, you'll be able to upload your file. It will then appear on your screen like this: ![How to upload Excel files to ChatGPT](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/upload-Excel-file-to-GPT4.png) Below your file, you can write your prompts, ask ChatGPT to assess and analyze your file, create charts with the data, provide insights and advice, and more. ### **2\. Analyze data and create charts** Once you’ve uploaded your data file, you can start asking questions to help analyze the data. You can even ask GPT-4o to create a chart based on the data you’ve provided. Here are a few simple examples of the types of charts and graphs that GPT-4o can create: **\[Note*: We've used simplified fictional data for demonstration purposes.\]* ![GPT-4o graph example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/GPT-4o-graph.png) ![GPT-4o chart example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/GPT-4o-finance-chart-example.png) ![GPT-4o pie chart example image](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/GPT-4o-pie-chart-example.png) --- ## **Analyzing financial data in GPT-4o** To help you get to grips with how you can use GPT-4o in [finance or data analytics](https://www.financealliance.io/what-is-big-data-security-analytics/), let’s look at an example. We’ve used some ‘dummy data’ to test and demonstrate how finance can leverage this technology in their roles. So, let’s begin by assuming we’ve just uploaded the data below and GPT-4o has put it all into this nice, clean table for us: ![ChatGPT - GPT-4o example data table for analysis](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/GPT4o1.png) Now we're ready to begin analyzing this data. So, we asked ChatGPT this question as a starting point: > *Analyze the cash flow forecast for 2024 and identify any potential liquidity issues. Highlight any months where the cash balance is projected to fall below the minimum required level of $50,000.* When we asked GPT-4o about the monthly cash flow, it provided a list showing the cash balance and liquidity position for each month. For example, January was noted as having a cash balance of **$60,136.25** and no liquidity issues since the cash balance is above the minimum required level of **$50,000**. Moving through the months, it provided similar insights. In May, GPT-4o reported a cash balance of **$47,788.65** and therefore notified us that there *is* a liquidity issue identified because the cash balance was below the minimum required level of **$50,000**. If we want to look into the data even further, we can ask more questions to get GPT-4o to perform data analysis. Here are some examples of the questions we asked, and the responses that GPT-4o gave in return: **Q. Which months have the lowest cash balance, and what could be the potential reasons for this?** ![GPT-4o example of data analysis](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/gpt4.o.png) --- **Q. Calculate the average monthly cash inflows and outflows for 2024.** ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/gpt4.o3.png) --- **Q. Identify and explain any months where cash inflows are significantly lower than average.** ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/gpt.4.o4.png) We’ve used quite a simple example, but it shows just how well GPT-4o can analyze financial data. We suggest trying it out for yourself and seeing what types of insights you can get back from it. By leveraging GPT-4o, you can [process and analyze data](https://www.financealliance.io/cost-benefit-analysis/) to discover deeper insights and improve decision-making. --- [How to use Gemini AI with Google SheetsGoogle’s latest breakthrough in artificial intelligence, Gemini, has many finance pros anticipating its transformative potential in data analysis and decision-making.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/how-to-use-google-gemini-with-google-sheets-2.jpg)](https://www.financealliance.io/how-to-use-gemini-ai-with-google-sheets/) --- ## **Voice conversations** Aside from data analysis, GPT-4o offers extra capabilities for natural conversations and streamlined workflows. With the new Voice Mode, you can engage in voice conversations with the AI directly from your computer. This feature lets you do things like brainstorm ideas or discuss pressing topics in finance using speech input and output. --- ## **Desktop app – GPT-4o** OpenAI is launching a new [ChatGPT](https://www.financealliance.io/chatgpt-for-excel/) desktop app for macOS, so you can now access GPT-4o via the app (it's also available for both free and paid plan users). This app integrates with your computer, so you can access the AI instantly using a keyboard shortcut (Option + Space). From there you can ask questions, take screenshots, and discuss them directly within the app. The desktop app also offers features like screenshot capture and annotation, making it easier to collaborate with the AI on visual content or seek clarification on specific elements within an image. This might be particularly useful if you want help analyzing charts, graphs, etc. --- ## **Math problems with GPT-4o \[video\]** OpenAI posted the video below to demonstrate how you can use GPT-4o to help with math problems. It's interesting to see how well this AI tool performs mathematical problems. Perhaps it'll be just as useful for helping with things like financial formulas or calculating metrics for your next report, etc. *Of course, it's important to double-check the answers you get to make sure you're getting accurate responses!* --- ## FAQs ### **What is GPT-4o?** GPT-4o is OpenAI’s latest flagship model that can reason across audio, vision, and text in real-time. OpenAI claims it's a step “*towards much more natural human-computer interaction*.” ### **How is GPT-4o different than other versions of ChatGPT?** GPT-4o differs from other versions of ChatGPT by offering improved performance, including faster response times and better handling of complex queries, while retaining the comprehensive language capabilities of GPT-4. ### **Is GPT-4o free?** Yes, GPT-4o is available to users of the free version of ChatGPT. ### **Is GPT-4o better than GPT-4?** GPT-4o is considered as an optimized enhancement of GPT-4, offering better performance in terms of speed and efficiency. However, the core language capabilities remain consistent with GPT-4. ### **Is ChatGPT 4o available?** Yes, GPT-4o is now available to users. ### **What does GPT-4o do?** GPT-4o can assess, summarize, and converse with users via text, visuals, and audio. It also answers your queries by combining both model knowledge and information from the internet, helping to provide even better insights. ### **What's new about ChatGPT 4o?** GPT-4o is a new, optimized version of OpenAI's GPT-4, designed to enhance performance and efficiency while maintaining the robust language understanding and generation capabilities of its predecessor. It can now converse with you using images, audio, and video. --- ### Want to keep up with the latest advancements in AI and finance? Stay ahead of the curve by [subscribing to our newsletter](https://www.financealliance.io/finance-newsletter/) and joining our free [Slack community for finance professionals](https://www.financealliance.io/community/). You'll be the first to know about groundbreaking developments, insightful analyses, and practical applications that could revolutionize the way you approach finance. **Sign up today!** [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### The 5 key macro trends reshaping markets in 2024 URL: https://www.financealliance.io/5-key-macro-trends-reshaping-markets/ Last updated: 2024-05-10T16:00:30.000Z This article comes from **Nicholas Pardini**’s insightful talk, ‘*What Macro Forces Will Dominate Markets in 2024 and Beyond*’, at our **2024 Silicon Valley FP&A Summit**. --- What macro forces will truly move the economic needle over the next few years? If you’re in finance, getting ahead of the disruption is *crucial* for protecting portfolios and [spotting opportunities](https://www.financealliance.io/spotting-strategic-opportunities-and-driving-business-growth/). As a macro analyst, my job is to connect the dots between the big economic, political, and social trend lines to provide businesses and investors with actionable insights and analyses. So today, I want to pull back the curtain and reveal the key macro trends I believe will shake up markets in 2024 and beyond in a major way. From new tech breakthroughs to demographic changes and shifting political winds, the macroeconomic landscape is shifting dramatically, and recognizing these pivot points early could pay massive dividends. Ready to uncover the pivotal forces shaping the road ahead? Let's dive in! ## **1\. Unavoidable economic volatility** ### The economic consensus view is that we'll achieve a fabled "soft landing" - a gradual slowing of growth that avoids recession while inflation cools back to normal levels. But I've got to be honest with you all - I think the odds of this "soft landing" scenario are pretty unlikely. Two other probable paths I see are either a resurgence of persistent inflation or an outright recession hitting. One potential inflation catalyst is the enormous horde of [pandemic](https://www.financealliance.io/saas-finance-in-a-post-pandemic-world-lessons-from-covid-19/) savings flooding into interest-rate-sensitive sectors like housing, which now makes up a whopping **41%** of the Consumer Price Index. On the recession side, the leading indicators of economic activity haven't been looking rosy outside of the job market. We're now seeing signs of consumers crowding out amid still-high inflation and rising credit card delinquencies. Adding to the volatility risks is the political chaos surrounding the record number of elections happening globally in 2024\. With India, the U.S., the U.K., and Mexico among the **4 billion people** voting, how will markets digest surprises or disputed results? From an investment standpoint, all of this potential economic and political turmoil suggests the opportunities will be greater in smaller U.S. companies and international markets rather than large-cap domestic stocks. The mega-caps, especially in tech, are already pricing in relatively optimistic scenarios compared to the smaller fry. As an example, cast your mind back to the early 2000s tech bust. While the S&P 500 fell around **25%** from the top, the Russell 2000 small-cap index rallied a staggering **165%** over that stretch as the domestic economic engines kept chugging. International equities today are trading at a **35%** discount to pricey U.S. markets, offering the same kind of potential upside. [Recession fears: How CFOs can address banking system concernsThis article will explore the growing fears of a potential banking crisis and how they compare to previous financial crises while offering insights on how CFOs can navigate these challenges.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/05/banking-crisis-news-2.jpg)](https://www.financealliance.io/growing-recession-fears-banking/) _This post is for paying subscribers only._ ### 5 strategies for promoting financial accountability across the company URL: https://www.financealliance.io/financial-accountability/ Last updated: 2025-04-05T07:28:17.000Z Promoting financial accountability across the company is a smart move for a few reasons. 💰 *Firstly*, it’s about protecting the **bottom line**. When everyone understands their role in managing finances *responsibly*, it helps avoid costly mistakes, careless spending, and possible legal or compliance disputes down the road. Money saved is money earned, right? 🤝🏻 *Secondly*, it builds **trust and transparency**. When everyone takes ownership of finances, it shows a combined investment in the company’s success. It also opens the door for better communication between other departments and finance, which helps improve collaboration too. 🛡️ *Thirdly*, it improves **risk management**. Identifying financial issues early can stop them from snowballing into much larger problems. By encouraging accountability in finance, you’re also inspiring responsible spending, which helps everyone stay within budget. Looking after the company’s money is a shared responsibility that needs diligence, transparency, and accountability from *all* levels of the organization. Failure to maintain financial responsibility can lead to: - Wasted resources - Missed opportunities - Compliance issues - Financial blind spots - Damaged reputation ![](https://media.tenor.com/LX1reyWcd8EAAAAC/oopsies-ohno.gif) The good news is that there *are* steps you can take to help build collective financial accountability across the company. So, keep reading if you want to find out what they are and learn more about the importance of financial accountability.👇🏼 --- ### **Read all about:** - [What is financial accountability?](https://www.financealliance.io/p/82277504-881e-4bef-8efd-6d0b766ab719/#what-is-meant-by-financial-accountability) - [Types of accountability](https://www.financealliance.io/p/82277504-881e-4bef-8efd-6d0b766ab719/#types-of-accountability) - [Key principles to keep top of mind](https://www.financealliance.io/p/82277504-881e-4bef-8efd-6d0b766ab719/#what-are-the-principles-of-financial-accountability) - [Tips to promote financial responsibility in business](https://www.financealliance.io/p/82277504-881e-4bef-8efd-6d0b766ab719/#5-ways-to-build-a-culture-of-financial-accountability) --- ## 5 tips to promote company-wide financial accountability ## What is meant by financial accountability? Financial accountability is when everyone in the company takes responsibility for the money. It means using it wisely, following clear spending rules, and being open about how finances are managed. This builds trust, helps management make smart decisions, and keeps the company on track for long-term success. However, accountability in finance goes *beyond* the people in the company itself. For example, [Investopedia](https://www.investopedia.com/terms/a/accountability.asp) states that financial accountability, particularly in the U.S. includes: > "...a *requirement that public corporations make accurate financial records available to all stakeholders*". ****Important reminder:** Maintaining financial accountability isn’t just a best practice, it’s a legal and ethical obligation. --- ## Types of accountability While not always directly related to finance, here are the main 'types of accountability' when talking about the topic with a wider lens: 🏢 **Corporate accountability**: Companies are responsible to shareholders, workers, customers, and communities through ethical practices and proper [financial management](https://www.financealliance.io/5-change-management-strategies-finance-transformation/). ✊🏼 **Political accountability**: Politicians are answerable to the public for their decisions, spending, and conduct while in office. ⚖️ **Government accountability**: Government bodies operate with integrity, following rules, and acting in the best interests of citizens. 📱**Media accountability**: News outlets and journalists ensure accurate, fair, and ethical reporting that is fact-checked and independent. When you zone in on types of accountability in finance in particular, you have to look at it in connection to areas like financial controls, audits, compliance, and more. Let’s go over some of these financial accountability types (and what they involve) in more detail: ![Financial accountability types to consider](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/Financial-accountability-types.png) --- ## What are the principles of financial accountability? **1\. Transparency** One of the most important principles of financial accountability is transparency, which means being open and making sure financial information (like activities, decisions, and performance) is visible and accessible. **2\. Diligence** When you’re trying to build financial accountability in your company, you need to make sure you’ve clearly defined roles, policies, and processes that align financial duties and decision-making. To ensure resources are used properly, make sure everyone knows *what* they’re responsible for. **3\. Accountability** Everyone, from individual employees to department heads and leadership, *must* be held responsible for their financial decisions and adherence to established policies. **4\. Compliance** To guarantee accurate and legally [compliant financial reporting](https://www.financealliance.io/finance-and-compliance/), you need to make sure the company (*and departments within it*) follow all relevant financial regulations and accounting standards set for their region/location. **5\. Risk management** Staying ahead of [financial risks](https://www.financealliance.io/financial-crime-risk-management-fcrm/) is key. So, keep a close eye on spending patterns and watch out for any areas of wasteful spending. It’s also a good idea to have backup plans ready for unexpected bumps in the road. **6\. Performance measurement** Keeping tabs on important money numbers like profitability, growth, and how resources are being spent allows the company to see how it's progressing toward its financial goals and where it needs to make improvements. --- [The CFO’s First 90-Days PlaybookThe CFO’s First 90-Days Playbook is your handy guide packed with proven tips, tactics, and advice on how to crush those first 90 days as a CFO.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/03/FA_The_CFO-s_First_90-Day_Playbook_Meta_2.png)](https://www.financealliance.io/the-cfos-first-90-day-playbook-blog/) --- ## 5 ways to build a culture of financial accountability ### 1\. Establish clear policies and procedures The first of the accountability steps is to develop clear policies that outline things like [expense management](https://www.financealliance.io/tips-to-allocate-budget-across-departments/), procurement, and approval processes. Make sure the policies clearly define the where, how, and who: - *Where* we can spend - *How* we get what we want - *Who* needs to approve Create accessible procedures that are clear and transparent. The point is to reduce confusion and any ambiguity that might arise. By doing so, the rest of the company will have a much easier time following the guidelines properly (and avoid making financial mistakes). ****Clear policies** are the foundation for strong financial accountability. ### 2\. Define your budget and budget ownership Involve departments in setting realistic budgets and give them ownership over managing those budgets. ![](https://media.tenor.com/cBTWzyEHstUAAAAC/please-i-know-the-owner.gif) [Budget](https://www.financealliance.io/budget-vs-annual-operating-plan/) ownership is a key strategy for promoting accountable finance and here’s why it works: > **Shared responsibility = shared success.** When different departments (besides finance) are involved in defining realistic budgets, they take ownership of their [financial performance](https://www.financealliance.io/flexible-budget-performance-report/). This creates a stronger sense of responsibility and even encourages cost-consciousness. To do this right, you need to involve department heads and key personnel in the budgeting process. And take the [bottom-up approach](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) if you can. This way, departments will build their budgets from the ground up, detailing expenses and spotting possible cost-saving moves. ⏰ Don’t forget to check in from time to time. You could schedule regular meetings to review progress and adjust budgets as needed, which is another great way to allow for course correction if required. --- [How to create a flexible budget performance reportWe’re all familiar with the traditional static budget – a fixed plan based on predetermined assumptions. But what if you need a budget that can adapt to your actual business activity levels? One that gives you a more realistic view of your financial performance?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/Flexible-performance-budget-report-2-2.jpg)](https://www.financealliance.io/flexible-budget-performance-report/) --- ### 3\. Build strong internal controls It’s usually not a great idea to have one person in control of an entire process from start to finish. So, **segregate duties** to help prevent errors or even misuse of funds. Doing this will help improve internal controls and create a center for financial accountability. Just like balancing your checkbook, regular reconciliations compare financial records with external statements (bank accounts, credit card statements, etc.). This is a great way to identify discrepancies sooner rather than later. Another way to help implement strong internal controls is by building systematic review processes. These types of processes will be useful for things like requiring high-level approvals for large expenses. Let’s look at an example of how this all might work in real life. Say you want to build stronger controls after an incident of unauthorized spending led to a very expensive mistake. How would you tackle this situation and use it to improve existing internal controls? Well, one way is to segregate *who* can create purchase orders from those *who* can receive inventory and approve invoices. You could also think about reconciling open POs to receipts weekly, which would surface any discrepancies. Finally, a [spend management system](https://www.financealliance.io/saas-cost-management/) that enforces approval rules and coding requirements would prevent future policy violations. The key is implementing overlapping preventive and detective controls, while strategically automating aspects with technology. This embeds financial accountability into core processes. ### 4\. Training and education Not everyone ‘speaks finance.’ And, if you’ve been in finance for some time, you’ll know the truth of that statement more than anyone. So, a seemingly obvious but often overlooked strategy to build financial accountability is through training and education. ![](https://media.tenor.com/KNIHRqyJWKsAAAAC/jurassic-park-responsibilities.gif) Just for laughs 👀 How’s how you can approach this: First, identify any knowledge gaps within departments. Do marketing teams need a better understanding of [cost analysis](https://www.financealliance.io/cost-benefit-analysis/)? Do sales understand the impact of discounts on profitability? Tailored training addresses specific needs and maximizes impact. Next, you’ll need to take time to break down complex financial concepts into clear and understandable language. So, leave the jargon and niche finance terms out in the cold for now and try to make everything as accessible and relevant as possible. Remember, everyone learns differently. A long, in-depth lecture might work for some people in your company but it might send others into a sleep-like state. Don’t be afraid to mix things up and leverage things like workshops, online courses, and simulations to help engage employees better. Lastly, it’s important to understand that this will be an *ongoing* thing. Continuous learning is key for building fiscal accountability and making it stick. --- [Why CFOs need to be great people managers (10 tips)Being a Chief Financial Officer (CFO) and leading a phenomenal finance team isn’t just about financial management and strategy - it’s about people and being an effective people manager.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/03/people-manager.jpg)](https://www.financealliance.io/why-cfos-need-to-be-people-managers/) --- ### 5\. Align goals and reward success Let’s end on a positive note and talk about [how you can motivate the team](https://www.financealliance.io/finance-talent/) into action with reward-based incentives.🥇 By aligning performance metrics with incentives, you can create a powerful system that motivates departments to actively participate in accountable finance. When achieving financial goals becomes a shared objective with tangible rewards, it strengthens teamwork, drives performance, and fuels the company's success. Here’s how it works: - **Define key performance indicators** (KPIs) that are specific, measurable, achievable, relevant, and time-bound (SMART). - **Don't create departmental silos**. Make sure that each department's KPIs directly tie back to and support the company's broader financial goals. - **Develop incentive programs** that reward teams and individuals for achieving financial targets while maintaining compliance. --- ## FAQs: Financial accountability in business What is an example of accountability in finance? An example of accountability in finance is having a clear approval process for expenditures, where team members are responsible for making purchases have defined spending limits and must provide proper documentation for each transaction. How to ensure financial accountability? To ensure financial accountability, companies should implement strong internal controls, performance metrics aligned with incentives, segregation of duties, regular audits, and mechanisms for reporting and addressing issues. What are four types of accountability? Four types of accountability are corporate accountability, political accountability, government accountability, and media accountability. What is the first stage of financial accountability? The first stage of financial accountability is establishing clear policies, processes, and guidelines that define financial roles, responsibilities, and appropriate practices within the organization. What are the benefits of financial responsibility across a company? Benefits include protecting the organization's assets, mitigating risks, eliminating wasteful spending, driving performance through disciplined planning, and promoting ethical financial management. Who is responsible for financial accountability? Financial accountability is a shared responsibility across all levels of an organization, from individual contributors to department heads to executive leadership and the board of directors. What are the consequences of lacking accountability for finances within a company? Lack of financial accountability can lead to consequences such as misuse of funds, compliance violations, financial losses, erosion of stakeholder trust, legal risks, and potential reputational damage to the organization. --- ### Want to optimize your processes even further? Our **Pro Membership** offers a unified source of trustworthy value for finance professionals to gain new knowledge and access templates and tools to help you optimise your daily activities and skyrocket your finance career to new heights. This membership plan helps you to gain access to the most recent resources, and a supportive community of peers who share your passion for achievement. Learn more about our [Pro Membership here](https://www.financealliance.io/pro-membership/). [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/05/1-1.png) ](https://www.financealliance.io/pro-membership/) ### Chief Investment Officer vs Chief Financial Officer: The key differences URL: https://www.financealliance.io/chief-investment-officer-vs-chief-financial-officer/ Last updated: 2026-04-20T07:34:41.000Z Chief Investment Officer (CIO) vs Chief Financial Officer (CFO) - they’re two very important C-suite roles, and while they may seem similar at face value, these roles are *completely* different. Each focuses on different areas of finance. While the CIO is mostly responsible for the company’s investment portfolio, CFOs oversee the *entire* financial operations of a business including budgeting, financial reporting, risk management, and more. Want to learn more? Keep reading to unpack the surprising differences between a Chief Investment Officer vs a Chief Financial Officer. #### Key takeaways 👇 - CIOs prioritize maximizing returns, while CFOs ensure financial stability and control spending. - While they may wear different hats, they have the same goal - to secure the company's financial success, just from different angles. - Both roles require strong communication and leadership skills to collaborate effectively. ## **What is a Chief Investment Officer?** A Chief Investment Officer is a senior member of the C-Suite responsible for managing and overseeing a company’s **investment portfolio**. They’re constantly looking for the best ways to help grow the company’s wealth. While not every company needs a CIO, you’ll often find them to be vital roles in financial and investment institutions, as well as in companies that have significant investments in financial assets, real estate, etc. ****Fun fact:** The CIO may choose to call the shots directly **or* they may oversee a team of analysts and portfolio managers who handle the day-to-day investment decisions. Some CIOs even choose to outsource the whole operation, hiring external investment firms to manage a portion (or all) of the portfolio. This lets them focus on broader strategic initiatives while leveraging the expertise of outside specialists. ## **Chief Investment Officer responsibilities** The role of a Chief Investment Officer is very important when it comes to building and managing a company’s investment strategy. While not every company needs a CIO, there are plenty that rely on their expertise to manage things like assets, investment portfolios, stocks, bonds, and more. Sometimes, the CIO role gets bundled with other duties, or the CFO might handle these responsibilities. But one thing remains the same: someone needs to make sure those investments are working hard! Alright, let’s get into some of the most *important* responsibilities of a CIO: - Developing and managing the business’s investment plan and guidelines. - Researching and analyzing profitable investments to find the most profitable opportunities. - Deciding [how to allocate investments](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) across different types like stocks, bonds, and alternatives. - Monitoring and adjusting the investment portfolio to make sure it aligns with the business’s goals. - Evaluating and reporting on how well the investments are performing compared to benchmarks. - Putting strategies in place to reduce and manage investment-related [risks](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/). - Working closely with the executive team to ensure investments align with overall business objectives. - Staying updated on market trends, regulatory changes, and economic factors affecting investments. - Overseeing and managing any external investment managers or advisors the company uses. --- [Multiple on Invested Capital (MOIC): Definition & guideIn this article, we’re zeroing in on MOIC to uncover what it is, its role in private equity, and more importantly, how you can use it to sharpen your investment evaluation skills.r![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/03/MOIC.jpg)](https://www.financealliance.io/multiple-on-invested-capital-moic/) --- ## **Chief Investment Officer vs Chief Financial Officer: Key differences** While CIOs and CFOs share some similarities, their roles and priorities are vastly different. Here’s a breakdown of the main ways the two roles differ: ### **🎯 Priorities** **CIO:** Their main priority is to maximize returns on the company's investments while managing risk – they want to *grow* the investment portfolio's value over time. **CFO:** As the finance leader of a company, the CFO prioritizes the company's financial health and stability – their top priorities include [budgeting](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/), managing cash flow, and financial reporting. ### **🏹 Strategic focus** **CIO:** Maximizing returns from investments and managing the associated risks. **CFO:** Focuses on the company's financial health, ensuring it remains financially stable and profitable. ### **🗂️ Reporting** **CIO:** Typically reports to the CEO and may also collaborate with the CFO on investment decisions that impact the company's overall financial health. **CFO:** Reports directly to the[ CEO](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/) and oversees the entire finance department. They’re also responsible for all financial reporting to the board of directors and regulatory bodies. ### **🔍 Scope** **CIO:** Their scope is limited to managing the investment portfolio, including stocks, bonds, real estate, or other assets. **CFO:** Has a much broader scope, encompassing all aspects of the company's finances. This includes accounts payable, receivable, [financial reporting](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/), taxes, and risk management. ### **💼 Compliance** **CIO:** CIOs need to follow the rules, especially investment laws. But their main job is to follow the company's investment plan. **CFO:** CFOs are heavily involved in compliance and responsible for ensuring that financial practices adhere to [laws and regulations](https://www.financealliance.io/finance-and-compliance/). ### **🤝 Interaction with stakeholders** **CIO**: Often communicates with internal stakeholders about the performance of investments and may have interactions with external fund managers and investment banks. **CFO:** Has a broader range of stakeholder interaction, including internal departments, external investors, regulators, and financial institutions. --- [5-step stakeholder communication planA stakeholder communication plan is a strategic document outlining how a company will communicate with its stakeholders.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/stakeholder-communications-pla.jpg)](https://www.financealliance.io/stakeholder-communication-plan/) --- ## **Top 5 Chief Investment Officer skills** Success as a Chief Investment Officer requires a diverse skillset that blends financial expertise with leadership and vision. But what are the most important Chief Investment Officer skills? Here are five that keep showing up as ‘desired skills’ in typical CIO job ads: ### **1\. Investment acumen** A CIO needs to be well-versed in financial markets, different types of assets like stocks and bonds, and various investment strategies. Having this expertise helps them spot promising investment opportunities, evaluate the potential risks involved, and make smart decisions that support the organization's overall objectives. Without a strong grasp of investments, a CIO would struggle to effectively manage the organization's portfolio and maximize returns. ![Chief investment officer skill tips](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/04/Chief-investment-officer-1.png) ### **2\. Risk management** Investments involve risk. So, a skilled CIO needs to identify potential risks, assess their likelihood and impact, and implement strategies to mitigate them. This helps to make sure the company is protected from unforeseen losses. ![CIO skills - development tip](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/04/Screenshot-2024-04-25-at-15.07.26-1.png) ### **3\. Strategic thinking and vision** A CIO doesn't just manage investments; they craft the investment strategy. This requires a clear vision of the company’s long-term goals and being able to develop an investment strategy that aligns with those goals. As you can imagine, doing this effectively requires a strong ability to think strategically about long-term financial outcomes and make decisions that balance potential rewards with associated risks. ![Chief investment officer skill tip](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/04/Screenshot-2024-04-25-at-15.07.49-1.png) ### **4\. Communication skills** CIOs need to communicate complex financial information clearly and concisely to a diverse audience, from internal stakeholders to external regulators. This means that they must have great communication skills, especially when it comes to making sure everyone understands the investment strategy, its rationale, and its performance. ![CIO skills](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/04/CIO-skills.png) ### **5\. Leadership** As the head of the investment team, a CIO will be much more successful if they know how to lead, manage, inspire and direct a team of investment professionals. This will also help to build trust with colleagues and create a great culture of collaboration within the team. ![Chief investment officer skills](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/04/Screenshot-2024-04-25-at-15.08.23.png) --- ## FAQs: CFO vs CIO What's the difference between CFO and CIO? The CFO oversees the overall financial operations of a company, including financial planning, risk management, and financial reporting. The CIO specifically manages the company’s investment portfolio, focusing on investment strategy, asset allocation, and performance monitoring. What is the role of a Chief Investment Officer? The role of a Chief Investment Officer is to oversee the investment strategy and portfolio of a company. This usually includes responsibilities like managing asset allocation, analyzing market trends, ensuring compliance with investment policies, and optimizing returns. How do you become a Chief Investment Officer? Becoming a CIO usually requires experience in investment management or financial services. Most CIOs also have advanced degrees in finance, economics, or business, coupled with professional certifications like CFA (Chartered Financial Analyst). What is the difference between CEO and Chief Investment Officer? The CEO (Chief Executive Officer) is the highest-ranking executive in a company, usually the boss, who is in charge of making big decisions, running the whole company, and keeping the board of directors informed. The CIO, while high-ranking, focuses on the company's investment strategy and portfolio management What is a Deputy Chief Investment Officer? A Deputy Chief Investment Officer assists the Chief Investment Officer in managing and overseeing the investment activities of a company. This role often involves taking on significant responsibilities in the investment operations, including strategy implementation, research, and daily management tasks, particularly in the absence of the CIO. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### Networking & collaborating in finance: A testimonial URL: https://www.financealliance.io/the-power-of-networking-case-study/ Last updated: 2024-04-04T14:08:03.000Z Our free [Slack community](https://www.financealliance.io/community/) for finance professionals isn't just another chatroom – it's a vibrant hub where you'll find an incredible network of CFOs, FP&A analysts, Finance Directors, and industry veterans. Imagine having direct access to these sharp minds, ready to answer your burning questions, offer battle-tested solutions, and collaborate on real-world challenges. That's the kind of value you get when you join our community. But don't take our word for it! We caught up with one of our amazing members, [Erik Nakamura](https://www.linkedin.com/in/eriknakamura/), CFO at Orange Comet, Inc., who raved about the community's impact. He talked about the "*open and welcoming*" culture, growing his network, and his experience mentoring other members. Keep reading to find out more about Erik's experience with our community. His story is just one example of the countless connections and invaluable insights waiting for you! ### What was your motivation for joining our community? Finance professionals are drawn to our community for a variety of reasons. Maybe they want to connect with others who share their interests or perhaps they're looking for a supportive network, a place to ask questions, share experiences, and learn from others. Whatever their motivations, our community offers a welcoming space for them to grow, learn, and connect. For Erik, his main motivation for joining was to expand his network: > *"Networking, meeting great finance professionals and getting a chance to speak at the great Finance Alliance events was my main motivation for joining!"* ### What have you enjoyed most since joining? Finance professionals often flock to our community for two reasons. First, we offer deep dives into industry best practices through insightful blog posts, reports, and playbooks. This allows them to stay ahead of the curve and implement the latest strategies. Second, our community fosters ongoing learning. We host regular workshops and webinars where members can engage in open, collaborative discussions about high-level financial strategies. Additionally, for those seeking a more immersive experience, we hold in-person events like the FP&A and CFO Summits, which have become highly popular among our members. > *"I really enjoyed speaking at the Finance Alliance conference in San Diego. The diversity in people and experience levels was nice to see."* **Learn more about our upcoming finance events** [**here**](https://events.financealliance.io/?%5Fgl=1%2A7to2b5%2A%5Fga%2AMjU3ODQyODEzLjE3MDQxOTM1NTM.%2A%5Fga%5F2NXFSBEP4N%2AMTcxMTYzMTIwOS4xNjguMS4xNzExNjMzNTc3LjAuMC4w)**:** [Finance Alliance WorldFinance Alliance presents its global summit series, with conferences specializing in FP&A and CFO the series visits London, Boston and San Francisco.![](https://assetsacara.com/production/organizations/62876e34645e9fcb6e4019c8/1653669622372-FA-Icon-Colour.png)World Finance Forum 2024![](https://assetsacara.com/production/organizations/62876e34645e9fcb6e4019c8/1700473872437-FP-and-A-Generic-Meta-2023-.jpg)](https://events.financealliance.io/?%5Fgl=1%2A7to2b5%2A%5Fga%2AMjU3ODQyODEzLjE3MDQxOTM1NTM.%2A%5Fga%5F2NXFSBEP4N%2AMTcxMTYzMTIwOS4xNjguMS4xNzExNjMzNTc3LjAuMC4w) ### What type of discussions have you found the most insightful and useful? There's always a lot of chatter happening in the different Slack channels of our community, but you can also enjoy learning from others at one of our finance events. This has been one of Erik's favorite types of discussions to have since joining us: > *"At the FP&A Summit in San Diego, I was able to network and meet other speakers and other CFOs. Discussing and understanding their challenges and successes was comforting that others are having similar experiences to myself."* ### What type of resources have you found the most helpful? We offer a wide range of resources from blog posts to podcasts, videos, webinars, practical guides, reports, eBooks, and more. We asked Erik what type of resources he has found the most useful and he talked about our various publications being particularly helpful: > *"Meeting others and continuing conversations after networking events. Also, the publications that are pushed out from the Finance Alliance are good resources."* ### Have you built up any new connections? Networking in finance isn't always easy. But, with our community (and events), we provide the perfect platform for both virtual *and* in-person networking with industry leaders. > *"Yes, I met several folks at the San Diego event that I spoke at. I have connected with most of them via LinkedIn. I look forward to making more connections."* ### How has the community impacted your professional growth? We're dedicated to helping our members like Erik not only gain knowledge but also grow their careers within the finance industry. Take it from Erik himself: > *"I have been able to use the community to grow my personal brand building via posts on LinkedIn. Also, I have been able to meet others and mentor them with my experiences."* ### Can you share a specific instance where the community helped you overcome a professional challenge? We're dedicated to helping our members not only gain knowledge but also grow their careers within the finance industry. Just like Erik, who leveraged the community to build his brand and mentor others. But what about overcoming specific challenges? Here's a powerful example of a time when our community helped Erik overcome a challenge in his career: > *"I was able to reach out to others that I connected with via Finance Alliance and ask for introductions to strategic VCs my company was targeting while raising capital."* This is the kind of support our community fosters – connections that can make a real difference in your career journey. ### In what ways have you contributed to the community, and what was the outcome? > *"I have mentored or had discussions with members of the community. If a peer, I have had productive discussions on experiences and had chances to bounce ideas off other finance professionals."* ### How do you see the value of this community in comparison to other professional networks you're part of? > *"I see high value in networking and meeting others and the Finance Alliance has been super helpful for that. Using Slack, online meetings, events and publications from the Finance Alliance has been valuable."* ### Why should other finance professionals join the community? > *"Networking and meeting great finance professionals!"* --- ### About Erik Erik Nakamura is the CFO at Orange Comet, Inc. He is an experienced C-Level Senior Executive who is a dynamic and inspiring leader known for a coaching and mentoring approach to building successful, cohesive teams with superior operational excellence. He has expertise in growing Finance, HR, Legal, IT and Facilities teams from the ground up for public and private companies. Erik also has significant experience in equity and debt capital raising, securities offerings, FP&A, operational/technical accounting, treasury, internal controls and process implementation. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### 10 big-picture financial planning steps URL: https://www.financealliance.io/10-big-picture-financial-planning-steps/ Last updated: 2025-04-10T07:48:16.000Z One of the biggest mistakes financial professionals make is losing sight of big-picture financial planning best practices. Business success is all about having an eye on the *bigger* picture. Sure, it’s important to stay on top of your everyday tasks. But without considering how everything interconnects, it’s easy to miss out on opportunities for growth. That’s why we've put together these financial planning tips to help you supercharge your profits and achieve long-term success. **Topics covered:** - [What is big-picture financial planning?](https://www.financealliance.io/p/016afddd-3b90-4577-b126-9d38135bfeb5/#what-is-big-picture-financial-planning) - [Benefits of considering the bigger picture](https://www.financealliance.io/p/016afddd-3b90-4577-b126-9d38135bfeb5/#benefits-of-considering-the-bigger-picture) - [Putting a strategy in place](https://www.financealliance.io/p/016afddd-3b90-4577-b126-9d38135bfeb5/#how-to-put-a-big-picture-financial-planning-strategy-in-place) - [Common questions about financial planning](https://www.financealliance.io/p/016afddd-3b90-4577-b126-9d38135bfeb5/#faqs-common-questions-about-financial-planning) ## **What is big-picture financial planning?** Big-picture financial planning is a comprehensive way to handle a company's finances. It's like taking a step back and looking at the entirety of the business's financial state. In doing so, you’ll be better equipped to make predictions about future finances and revenue, and create a plan to reach long-term financial goals. This kind of planning covers all the wider financial areas of a business, including things like: - Managing cash flow - Creating a budget - Investing wisely - Managing risks - Dealing with taxes The goal is to make the most profit possible, cut down on costs, and make sure the business stays financially strong and continues to grow. [What is cash flow-based financial planning? | Finance AllianceFinancial planning is vital for organizations that want to cement their success and ensure their future is a bright one. Many argue that cash flow based financial planning is the most effective way to plan and manage resources by focusing on the amount of cash coming in and going out of a business.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/cash-flow-based-finanical-planning.jpg)](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/) ## Benefits of considering the bigger picture Here are some more reasons why this type of financial planning is the way to go: ### 1\. Better decision-making With a deeper understanding of the business's finances, you’ll be in a better position to make choices that align with the company’s long-term financial objectives. ### 2\. Efficiency gain A well-thought-out financial plan helps to streamline financial procedures, cut waste, and boost productivity. ### 3\. Better control over cash flow Improved cash flow management is achieved by anticipating future cash requirements and revenues. In doing so, you can prepare for cash flow variations and make sure that the business always has enough cash on hand to pay its debts. ### 4\. Reduced risks Considering all the financial components of a company helps you detect and reduce potential risks and maintain the company's financial stability. ### 5\. Profit growth A well-designed financial plan will highlight potential areas of the company for cost reduction and revenue growth, which ultimately leads to higher profits. ### 6\. Stronger financial stability By planning for the long term, you can ensure that the company has the resources it needs to weather any economic storm and remain financially stable. ![Big picture financial planning strategy - 10 steps - graphic image of upwards arrow trajectory](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/big-picture-financial-planning-2.png) ## How to put a big-picture financial planning strategy in place When done right, financial planning focuses on the big picture and considers more than just the company’s budget. But how can you create a ‘big picture financial plan’ that increases revenue? Here are 10 steps to help you do just that: **1.** Start with a clear understanding of your company's current financial position, including revenue, expenses, debts, and assets. **2.** Set clear financial goals, both short-term and long-term, for your company and develop a plan to achieve them. **3.** Forecast future cash flow needs and revenue to help make informed decisions about investments, expenses, and risk management. **4\.** Create a budget that considers all the major expenses of your business, such as salaries, rent, utilities, and marketing. **5.** Make sure you have a robust risk management plan designed to minimize the impact of financial risks on your business. **6.** Take notice of the tax implications of your financial decisions. And, plan accordingly to minimize your tax burden and maximize profits. **7.** Take advantage of technology to automate financial processes and improve efficiency. **8.** Regularly review and update your financial plan to keep pace with your business's and the economy's changes. **9\.** Keep up with the latest financial trends and best practices. You also need to be willing to adapt your plan as needed. **10.** Finally, be proactive about seeking out opportunities to improve profits, whether it's through expanding your product offerings, diversifying your revenue streams, or finding new markets to enter. [FP&A Manager: What does an FP&A Manager do? | Finance AllianceBut what does an FP&A Manager do? And what skills do you need to pursue a career in FP&A? In this article, you’ll learn what the main FP&A responsibilities, skills, and traits are to become a value-driven FP&A professional on the road to success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/FP-A-manager-blog.jpg)](https://www.financealliance.io/fp-a-manager-what-does-an-fp-a-manager-do/) ## **FAQs: Common questions about financial planning** **Q. What is the purpose of big-picture financial planning for organizations?** *A. The goal is to keep the organization's finances healthy by setting and reaching financial targets, using resources wisely, and reducing financial risks.* **Q. How do we set financial goals?** *A. Financial goals should match the organization's overall strategy and be specific, measurable, achievable, relevant, and have a timeline (SMART).* **Q. How do we manage our budget and forecast future financial performance?** *A. Budgeting and forecasting should be based on past data and realistic assumptions, considering any changes in the market, economy, and organization's operations.* **Q. How do we manage financial risk?** *A. Financial risk can be reduced through diversification, insurance, and close monitoring of financial metrics and market trends.* **Q. What investment strategies are best for organizations?** *A. Investment strategies should depend on the organization's goals, risk tolerance, and current financial situation. Options include stocks, bonds, real estate, and alternative investments.* **Q. How do we plan for taxes?** *A. Tax planning means estimating the organization's tax bill, taking advantage of deductions and credits, and staying up to date on tax law changes.* --- If you have more questions about big-picture financial planning, you can ask as many as you like inside our free[ Finance Slack community](https://www.financealliance.io/community/). There, you can network and discuss topics with hundreds of other CFOs and finance professionals. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### People, performance, profit: Why CFOs need to be great people managers URL: https://www.financealliance.io/why-cfos-need-to-be-people-managers/ Last updated: 2025-04-05T07:28:39.000Z Being a Chief Financial Officer (CFO) and leading a phenomenal finance team isn’t just about financial management and strategy - it’s about people and being an effective people manager. Think about it – finance teams are usually juggling intense workloads paired with extreme pressure to get things right down to the last decimal point. It's a demanding role, that’s for sure, which is why they need a leader who can keep them motivated, engaged, and thriving. At the end of the day, your people are your biggest asset. So, how can you support them and build a legendary [finance team](https://www.financealliance.io/people-planning-strategically-build-your-finance-dream-team/)? Keep reading as we reveal tips to help you become a people-centric CFO who empowers, motivates, and supports your team. **Table of contents:** - [The cost of a disengaged finance team ](https://www.financealliance.io/p/950bbb72-0f13-4708-baf7-41ca8905207f/#the-cost-of-a-disengaged-finance-team) - [What is a people manager?](https://www.financealliance.io/p/950bbb72-0f13-4708-baf7-41ca8905207f/#what-is-a-people-manager) - [10 tips to turn CFOs into great people managers](https://www.financealliance.io/p/950bbb72-0f13-4708-baf7-41ca8905207f/#10-tips-to-turn-cfos-into-great-people-managers) - [How to manage difficult people](https://www.financealliance.io/p/950bbb72-0f13-4708-baf7-41ca8905207f/#how-to-manage-difficult-people) - [FAQs](https://www.financealliance.io/p/950bbb72-0f13-4708-baf7-41ca8905207f/#faqs-cfos-as-people-managers) ## **The cost of a disengaged finance team** Before we get into the tips and strategies to help you grow as a people manager, let’s take a moment to remind ourselves why it’s so important to build a strong finance team. Some potential consequences of a disengaged finance team include: ![CFO people manager - cost of a disengaged finance team](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/people-manager-CFO.png) ### **1\. Reduced productivity** Unmotivated team members usually don’t put their best effort in. When productivity dips, it can slow everything down and lead to missed deadlines, increased stress, and errors in reports. Not to mention, a higher risk of [burnout](https://www.financealliance.io/how-to-optimize-finance-teams/) which can impact your team’s well-being. ### **2\. High turnover** If you have a high turnover, the constant churn is likely to disrupt workflows and leave a sizable knowledge gap in its place. As you can imagine, high turnover also results in costly recruitment efforts to hire and train new employees. ### **3\. Poor decision-making** Disengaged team members are less likely to go the extra mile, resulting in missed opportunities to identify cost-saving measures or strategic financial insights. For a finance team, poor decision-making can have consequences like lost revenue and increased expenses. It can also lead to costly [regulatory or compliance](https://www.financealliance.io/finance-and-compliance/) failures. ### **4\. Low morale** A team riddled with low morale can create a toxic workplace. This negativity can spread throughout the company, impacting overall morale and hindering collaboration. For finance team members, who often work under pressure, low morale can exacerbate the challenges of their roles. The bottom line? A disengaged finance team is a *drag* on your company's success. By prioritizing people manager responsibilities as a CFO, you'll not only build a happier and more motivated team, but you’ll also reap the rewards of a high-performing finance department that contributes to achieving company goals. --- [How to optimize your finance team with people, tech, & structureEverybody is currently struggling with resources. Because of inflation and a generally unstable environment, you can’t really just go out and hire people. I’m going to talk about how you can optimize your current team and make sure you can cover more ground with the teams that you already have.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTejas Parikh![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/pascal-swier-7de474KZIbs-unsplash.jpg)](https://www.financealliance.io/how-to-optimize-finance-teams/) --- ## **What is a people manager?** A people manager is someone in charge of leading, supporting, and developing a team of employees. They're not just supervisors; they're leaders who understand the value of building strong relationships with their team members. Some people manager responsibilities landing on your plate include: - **Hiring the best:** Find and bring in top talent for the team. - **Setting goals & tracking progress:** Make sure everyone knows what to achieve and how they're doing. - **Keeping them motivated:** Create a positive environment where people want to do their bestwork. - **Helping them grow:** Provide opportunities for them to learn new skills and advance their careers. - **Smooth sailing:** Address any issues that come up and keep the team working together well. A good people manager communicates effectively, provides feedback, motivates their team, and helps each member grow professionally. It’s about guiding the team towards achieving their goals while ensuring a positive and productive work environment. But what does any of this have to do with being a great CFO? The simple answer is that CFOs need to be people managers to build a high-performing finance team that's motivated, skilled, and thrives under pressure. --- [10 proven tips to retain top finance talentWhat can you do to keep your best employees happy and prevent them from becoming a flight risk? Here are 11 easy but effective ways to help retain your best finance talent.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/09/finance-talent.jpg)](https://www.financealliance.io/finance-talent/) --- ## **10 tips to turn CFOs into great people managers** Here are some actionable tips to help you become the best people manager for your finance team: ### **1\. Listen more than you speak** Make it a habit to truly listen to your team. This doesn’t mean just nodding along; it means engaging with their ideas, concerns, and feedback. You’ll be surprised how much you learn and how valued they’ll feel. ### 2\. **Transparent communication** Keep your team in the loop about the company’s financial health and their role in its success. Uncertainty breeds anxiety, while transparency builds trust. Remember that when your team understands the big picture, they’re more motivated to contribute to it. ### **3\. Empower, don't micromanage** Trust your team's expertise. Being a great people manager doesn’t mean micromanaging everything your team does daily. Delegate tasks, set clear goals, and give them the freedom to find their own solutions. You'll be surprised by the creativity and ownership they bring to the table. ### 4\. **Acknowledge and reward** Recognition goes a long way. Make a conscious effort to recognize your team’s hard work and achievements. This doesn’t always mean bonuses or promotions. Sometimes, a genuine "thank you" or public acknowledgement can really boost morale. ### **5\. Feedback is a two-way street** Don't just dish it out, receive it too! Regularly ask for feedback on your leadership style and how you can better support them. This shows you value their input and fosters open communication. ### 6\. **Build team cohesion** Organize team-building activities that aren’t just about work. This could be casual lunches, team outings, or volunteer days. It’s about strengthening relationships and fostering a sense of camaraderie within the team. ### 7\. **Offer flexibility** Show that you value your team’s [work-life balance](https://www.financealliance.io/mind-over-money-how-to-combat-burnout/). If possible, offer flexible working arrangements. It demonstrates trust and respect for their time and personal life, which in turn fosters loyalty and dedication. ### 8\. **Invest in their growth** Encouraging your team to pursue training and development opportunities is a key part of your role as a people manager. Urge them to attend [conferences](https://events.financealliance.io/?%5Fgl=1%2A1phqdh0%2A%5Fga%2AMjU3ODQyODEzLjE3MDQxOTM1NTM.%2A%5Fga%5F2NXFSBEP4N%2AMTcxMTYyNTE3My4xNjcuMS4xNzExNjI1NjcxLjAuMC4w), take online courses, or learn new skills relevant to their roles. It’s a win-win: they grow professionally, and you get a more skilled team. ### 9\. **Lead by example** Demonstrate the work ethic, integrity, and professionalism you expect from your team. Your behavior sets the tone for the entire department. Show them what it means to be committed and passionate about your work. ### **10\. Stay positive, even when it’s tough** Finance can be a high-pressure role. Your team will look to you for cues on how to react in stressful situations. Maintaining a positive, can-do attitude can greatly influence the team’s morale and productivity. --- [The CFO’s First 90-Days PlaybookThe CFO’s First 90-Days Playbook is your handy guide packed with proven tips, tactics, and advice on how to crush those first 90 days as a CFO.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/03/FA_The_CFO-s_First_90-Day_Playbook_Meta_2.png)](https://www.financealliance.io/the-cfos-first-90-day-playbook-blog/) --- ## **How to manage difficult people** Not everyone on your team will be easy to manage. Those team members who always seem to find something to complain about, push back on every decision, or spread negativity can pose a difficult challenge for any leader. As the CFO, how you handle these situations can make or break team morale. So, you need some trusted strategies to help manage them effectively. The first step is to approach them with empathy. There may be underlying reasons for their attitude - heavy workload, personal issues, feeling undervalued, etc. Have an open conversation to understand what's really going on. Sometimes simply listening and showing you care can go a long way. With that being said, you also need to set clear expectations and boundaries. Difficult as they may be, they still need to get their work done to your standards. Don't shy away from tough conversations if their negativity disrupts the team. It'll help if you make an effort to focus on solutions, not blame. Try not to dwell on the past and work together to identify solutions that improve their performance and team dynamics. If the situation escalates, document all interactions and performance concerns. This helps protect the team and provides a clear record if further action is necessary. Don’t be afraid to seek guidance from HR or a leadership coach if you need to. They can offer valuable insights and strategies for handling complex situations. Remember, the goal isn't to punish, but to improve performance and foster a positive work environment. By taking a solution-oriented approach, you can navigate even the most challenging personalities and maintain a strong, cohesive team. ![](https://media.tenor.com/84rqaYkWVVQAAAAC/the-office-michael-scott.gif) --- ## FAQs: CFOs as people managers Why is people management important for a CFO? People management is crucial for CFOs because it enhances team collaboration, boosts morale, and increases productivity. How can I improve communication with my finance team? Improve communication by holding regular meetings, providing clear and concise updates, and being open to feedback. Encourage an environment where team members feel comfortable sharing ideas and concerns. Listening is as important as informing. How can I support my team’s professional development? Support professional development by identifying training programs, workshops, and conferences that align with their career goals. Encourage mentorship within the team and allocate time and resources for learning. How can I build a strong finance team culture? Build a strong team culture by fostering open communication, encouraging collaboration, celebrating successes, and addressing challenges collectively. Establishing core values that resonate with your team can also strengthen your culture. What’s the best way to manage remote or hybrid finance teams? Manage remote or hybrid teams by using digital tools to maintain communication, setting clear expectations for work hours and output, and fostering a sense of community through regular virtual check-ins and team-building activities. --- ### Finance Alliance Pro Membership Join the Finance Alliance Pro Membership and unlock exclusive tools, resources, and a network of elite finance professionals. This is your chance to: - **Level up your skills:** Gain access to advanced financial analysis tools and expert-curated resources. - **Sharpen your thinking:** Engage in high-level discussions with peers, sparking innovative ideas and expanding your perspective. - **Build your network:** Connect with industry leaders and build your network. **Don't just survive your career, *thrive* in it.** **Join Finance Alliance Pro Membership today!** 🎓 [Sign Up](https://www.financealliance.io/pro-membership/) ### The CFO's First 90-Days Playbook URL: https://www.financealliance.io/the-cfos-first-90-day-playbook-blog/ Last updated: 2025-04-04T14:37:03.000Z Landing a new CFO role is a huge win, but diving in unprepared can quickly lead to overwhelm. Now, you're the key to the company's financial success – no pressure! That’s why your first 90 days as a CFO are so important. This short window sets the tone for your time with the company and lays the foundation for your future success. ***The CFO's First 90-Days Playbook*** is your handy guide packed with proven tips, tactics, and advice on how to crush those first 90 days as a CFO. ### **Why you *need* this playbook** Those first 90 days as a CFO are your chance to impress the board, build trust with stakeholders, and dive deep into the company's finances. Nail it, and you'll be setting yourself up for financial wins and long-term success. Misstep and well… let's just say the pressure will be on! You want to hit the ground running, which is why this playbook was created - to ensure you set yourself up for financial wins and long-term success. From quickly learning the business inside-out to building the right team around you, all the bases are covered! Grab your free copy of ***The CFO's First 90-Days Playbook*** and transform those first three months into a springboard for success. ### **Explore proven tactics to help you:** 🏃🏼 **Hit the ground running:** Lay the groundwork for success and learn how to make a positive first impression with your team, the board, and key stakeholders. 🏆 **Achieve early wins with BIG impact:** Discover actionable tips to secure quick wins in your first 90 days that demonstrate your financial acumen and deliver maximum value to the company. 🗺️ **Chart your course to success:** Develop data-driven financial, funding, and investment strategies that perfectly align with the company's overall business goals. 🤝🏻 **Build your A-team:** Learn how to assess, recruit, and retain top finance talent. 💬 **Collaborate with the right people:** Discover how to develop strong strategic partnerships with internal and external stakeholders. 🥇 **Become a change champion:** Benefit from practical change management tips honed by experienced finance leaders, ensuring a smooth transition and successful implementation of your financial initiatives. **Ready to make a lasting impact as CFO?** **Grab your copy now.👇** ### A complete guide to competitive intelligence URL: https://www.financealliance.io/a-complete-guide-to-competitive-intelligence/ Last updated: 2024-03-15T10:00:38.000Z *\[This blog post was originally posted on our sister community,* [*Competitive Intelligence Alliance*](https://www.competitiveintelligencealliance.io)*\]* Here’s the thing: Your competitors want to **beat** you. There are only so many prospects out there looking for a solution like yours. So if you’re stepping into their territory, they’ll want to make sure it’s *their* product customers think of first. Competitive intelligence is your tool for knowing your competitors’ strategies, priorities, strengths, and weaknesses. Armed with this information, you can fine-tune your strategies and initiatives to win. In other words, competitive intelligence is your **ticket to the top**. Read on to learn: - [What competitive intelligence is.](https://www.financealliance.io/p/5721cc78-c123-4803-9684-b90158bc11db/#what-is-competitive-intelligence) - [How competitive intelligence works.](https://www.financealliance.io/p/5721cc78-c123-4803-9684-b90158bc11db/#how-competitive-intelligence-works) - [The best sources of competitive intelligence.](https://www.financealliance.io/p/5721cc78-c123-4803-9684-b90158bc11db/#sources-of-competitive-intelligence-techniques-and-methods) - [The primary uses of competitor intelligence.](https://www.financealliance.io/p/5721cc78-c123-4803-9684-b90158bc11db/#uses-of-competitive-intelligence) - [Competitive intelligence best practices.](https://www.financealliance.io/p/5721cc78-c123-4803-9684-b90158bc11db/#competitive-intelligence-best-practices) …and a whole load more. ## What is competitive intelligence? At its simplest, competitive intelligence is information about your business competitors. You’ll use this information to navigate market dynamics, anticipate competitor moves, and refine your strategies for enhanced market positioning and profitability. Competitive intelligence can also refer to the role, or practice, of collecting this info on your competitors. Dedicated [competitive intelligence functions and roles](https://www.competitiveintelligencealliance.io/competitive-intelligence-analyst/) are becoming more and more common in businesses today. Some argue that a competitive intelligence professional is one of the earliest roles a small business owner should look to fill. Why? Because teams are doing competitive intelligence every day. Whether they know it or not. Even if you don’t have a dedicated role for it yet. Your competitive, goal-driven sales reps, for example, are interested in increasing their sales numbers. That involves getting to grips with *who* prospects choose when they don’t choose *you*. Yep. We’re talking about a competitor here. The information they manage to gather during their research is competitive intelligence - even if they don’t know it. That’s why, when you’re building out a competitive intelligence program, you’ll first assimilate all the competitor intelligence floating around in the business. ## The history of competitive intelligence Early on, competitive intelligence was covert and undercover. Before the internet, CI stemmed from a human intelligence model, borne from government intelligence agencies (think FBI). People would frame themselves as new customers and speak with competitors to gain [competitive pricing intelligence](https://www.competitiveintelligencealliance.io/competitive-pricing-intelligence/) and product intel. Think that sounds… kinda ethically unsound? You’d be right. Ethics concerns prompted a shift away from this model and, with the birth of the internet and more freely available intel, this kind of inspector gadgetery became unnecessary. ![](https://www.competitiveintelligencealliance.io/content/images/2022/09/ezgif.com-gif-maker--15-.gif) Now competitive intelligence amounts to researchfocused on core competitors. With these competitors, a tiny competitive advantage means hundreds more deals won, and massive ROI over time. This is what’s driving CI’s impressive growth, with the percentage of organizations monitoring competitors at least once per month [jumping from 64 to 70% from 2020 to 2021](https://www.competitiveintelligencealliance.io/trends-report-2021/). 📈 ## How competitive intelligence works Competitive intelligence can sound scary and complicated, but the process is actually super simple. Let’s break it down: 1. Data gathering 2. Data analysis 3. Data reporting 4. Data execution It’s a cyclical process. Executing on your plans will reveal new information that you can feed back into the beginning of the cycle. ### Data gathering [Data collection](https://www.financealliance.io/data-cleaning-techniques/) is the first step in competitive intelligence. As we’ve said, people in your org already gather information about your competitors. And all of that info’s fair game. What your data gathering process looks like will depend on your CI function’s maturity, the size of your CI team, and your budget. 💰 You’ll usually pull in data using a number of competitive intelligence techniques, but you'll start with the following methods: - Ad hoc research from other departments (e.g. sales, customer success). - Active intelligence gathering (e.g. viewing competitor websites, free trials). - Passive data gathering (with the help of a competitive intelligence platform). Good competitive intelligence research has a system for capturing all the insights coming out of conversations with customers. And other day-to-day activities too, even if they’re not strictly CI-related. You’ll also be collecting intel actively. There’s no substitute for getting up, close, and personal with your rivals. On their websites, they’ll announce the latest updates, publish news articles, and reveal clues about their hiring activities. ![The three most popular methods for gathering competitor intelligence](https://www.competitiveintelligencealliance.io/content/images/2022/09/image-1.png) **The three most popular methods for gathering competitor intelligence are all manual and intentional, like reading press releases and competitor emails.* Finally, competitive intelligence platforms and social listening tools are like Google Alerts’ better-looking, more charismatic siblings. They monitor the web and social media platforms for competitor activity. Then they’ll report that data back to you. ### Analyzing the intel Now it’s time to put that data to work. Through competitive analysis, you’ll extract meaning from the information you have and give it **context**. That means having an opinion and, in the next stage, sharing that opinion with key stakeholders to help create a plan of action. Don’t feel uncomfortable offering an opinion. As the competitive intelligence expert, it’s your job to stay up to speed with all the developments in the competitive environment. So when a competitor development lands on your desk, it’s you who’s best placed to make sense of it. You’ll decide whether this intel constitutes a threat or an opportunity to your brand and, from there, you’ll go ahead and get things done. > In competitive intel, your deliverable is not just the information. It's a clear and defensible point of view that's based on that information. \- *Alex McDonnell, market & competitive intelligence at Airtable* ### Sharing your findings Other departments are relying on you to bring them up to speed quickly on the stuff that matters. With your analysis in hand, you’ll report your conclusions to stakeholders. While number-crunching skills are useful, a lot of the most valuable data in competitive intelligence is qualitative. Feedback from win/loss interviews with new customers and lost prospects, for example, is invaluable. The people you’re targeting tell you directly which factors are most important to their decision-making process. Being able to dissect this kind of feedback, identify patterns, draw conclusions, and report those to your peers is what this stage is all about. ### Creating deliverables and executing With a plan of action in hand and your stakeholders on board, it’s time to execute. This is CI’s true purpose. To help you make informed decisions about your business strategy, come up with a plan of action, and execute it. Your deliverables should enable everyone in the organization to contribute as best they can to beating your competitors. Sometimes that means offering enablement assets to sales and customer success teams directly. Other times it means opening channels of communication to let people feel heard, strengthen the flow of intel through the business, and get everyone informed. A simple fix like creating a competitive Slack channel has great ROI. It’s quick to implement, open to everyone, and people can use it to ask questions, report their findings, and raise concerns. This keeps CI top of mind across all arms of the business. Similarly, a competitive newsletter, distributed internally, is a great way to keep everyone up to speed with the latest competitor developments and strategy changes. 💭 **Remember: CI is an ongoing process. You’ll continue to track progress and tweak your assets and strategies for continued success.* ## Sources of competitive intelligence: Techniques and methods So that’s the competitive intelligence process. But where do you actually get competitive intelligence from? What are [the best competitive intelligence sources](https://www.competitiveintelligencealliance.io/best-sources-competitive-intelligence/) and which [types of competitive intelligence](https://www.competitiveintelligencealliance.io/types-of-competitive-intelligence/) should you prioritize? Here are our top five competitive intelligence techniques: ### 1) Win/loss analysis Win/loss analysis is powerful. By speaking directly to newly won and lost prospects, you get an unbiased understanding of what’s driving their decision-making. Do it right, and you’ll know exactly how to sway new leads in your favor. And if that’s not a superpower, what is? 🦸‍♀️ > CRM data is not enough. Real win/loss analysis involves actually interviewing customers who have recently evaluated you versus a competitor. \- *Alex McDonnell, market & competitive intelligence at Airtable* --- [10 best financial modeling tools (2024) | Finance AllianceIn this article, we’ve highlighted key features to look for when choosing the right software - along with 10 leading financial modeling tools that stand out in today’s market.👇🏼![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/finanical-modeling-tools-2.jpg)](https://www.financealliance.io/10-best-financial-modeling-tools/) --- ### 2) Customer research and interviews More broadly than win/loss interviews, getting up to snuff with the opinions of your target audience makes it obvious what you’re doing well and where you can improve. How does this tie back to your competitors? Positioning. Over time, your product, your brand, and your business will grow and change. That’s a good thing, but it also means the sands are always shifting. You need to keep a vigilant eye on how your customers perceive you and where you’re truly winning with them. Combine that with your research on the wider competitive landscape, and you’ll nail your place in the competitive landscape and know which battles you can win. ### 3) Competitor research Manually monitoring your competitors, even through a browser and a tab for each website, gives you the lowdown on their latest developments. Most business websites publish news articles and blogs full of information about their products, business updates, even customer case studies. Having a nosey around’ll give you a sense of their content strategy. They’ll be trying to win high-value keywords with their content, but behind this SEO strategy, they’re trying to solve customer problems. Just scanning article titles can show you the ones they think are most important. By tying these findings back to your own strategies, you can determine whether your competitors are way off the mark, or are matching you step for step. ### 4) Passive monitoring and tools Even the most vigilant researchers might miss something. After all, the internet’s a big place. 🕸 Passively monitoring the web for mentions of your competitors, or associated keywords and queries, can act as both a safety net in case you miss something, and as an early indicator for competitor developments. Whether you choose Google Alerts or dedicated competitive intelligence software to take care of this stage in the data gathering pipeline, it pays to cast a wide net. ### 5) SWOT analysis SWOT analysis has you take a look at your competitors’ strengths and weaknesses, and the opportunities and threats present in the marketplace. But you can apply the SWOT framework to anything. Apply it to one competitor, all your key competitors, or to the market as a whole. Apply the framework to your own organization too. A comprehensive SWOT analysis that covers all these angles gives you a view of the whole market, and your place within it. When it comes to identifying your competitive edge, and how it might come under threat, there’s no better framework out there. But hold on! Make sure you do your customer research first. Incorporate it into this competitor analysis. This way, you go into the process with open eyes and an objective outlook. 👀 ## Uses of competitive intelligence Why use competitive intelligence at all? There are a number of key deliverables competitive intelligence can drive, and a number of key initiatives that those deliverables support. Let’s focus on those initiatives: ### Sales and revenue enablement The goal of any business function is to drive [revenue](https://www.financealliance.io/chief-revenue-officer-vs-chief-financial-officer/). Whether it’s increasing customer satisfaction scores or adding new product features, trace the line back far enough and you’ll arrive at “increased revenue” as the primary motivator. Your sales team does battle with your competitors every day. Indirectly, with their prospects as the proxy, sure. But their ability to persuade those prospects comes down to how well positioned your product and brand are against your competitors. Enabling your sales teams to win new deals with rock-solid messaging and objection handling is just one of CI’s uses. The best-known deliverable here is the [competitive battlecard](https://www.competitiveintelligencealliance.io/competitive-battlecards-guide-2022/), an on-hand, scannable flashcard primed with all the sound bytes your sales reps need to handle objections and position your product as the best one to meet the customer's need. --- [FP&A automation: Trade manual work for strategic impactIf you’re ready to step off the reporting treadmill and focus on projects that drive valuable insights and strategy, then it’s time to embrace automation in FP&A.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/ai-generated-8293345_1280.jpg)](https://www.financealliance.io/fp-a-automation/) --- ### Product positioning and messaging Marketing teams, too, can benefit from a strong CI program. ‘Cause CI makes it clear what you do best as a business (in the objective eyes of your customers and prospects, rather than your own) and where you fall short versus certain competitors. It lets you know [where your competitive advantages lie](https://www.competitiveintelligencealliance.io/sustained-competitive-advantage/) and how to stop your cheeky rivals from imitating them. 😤 With a firm grasp of your competitive advantages, you can also choose your battles more wisely. Choose the ones you’re in the best position to win, rather than competing against alternatives that are too well established, or that the market doesn’t consider similar to you. This also informs where you choose to stand in the competitive landscape, influencing your positioning, messaging and value propositions, and even your product development roadmaps. Finally, as your CI program uncovers new competitor developments, you’re in a great position to advise when it’s time to pivot and reposition. ### Content strategy Yep, competitive intelligence can even inform your content marketing strategy. In fact, all that keyword research your content managers do is itself a form of competitor intelligence. How, you ask? 🤨 Because they’re trying to uncover and reverse engineer your rivals’ successes. By tracking competitor performance across keywords, and keeping an eye on the content that’s performing best in your niche, they’re finding openings in the competitive landscape to exploit and aiding strategic business decisions. And, for your part, the intelligence you uncover will help your content writers speak confidently about competitors. It’ll help them speak about your products in relation to theirs. This competitive intelligence technique can help identify different content types and lead magnets (like video and long form ebooks) that you might want to give a shot. ![Domain overview - get instant insights into the strengths and weaknesses of your competitor](https://www.competitiveintelligencealliance.io/content/images/2022/09/Screen-Shot-2022-09-08-at-14.02.58.png) **SEO strategy can contribute to your CI research and vice versa.* ## Competitive intelligence best practices OK, so we’ve covered what competitive intelligence is. We’ve covered what sources to use, and even what to use it for. But, in the most practical sense, how do you *do* it? And, more importantly, how do you do it *properly*? 🤔 Here’s a shortlist of some competitive intelligence best practices we learned from industry experts in our community: ### 1) Over-communicate Competitive intelligence is *not* all about data. In fact, it’s a mostly relationships-based discipline. So, how you work and communicate with your colleagues is crucial to your success as a competitive intelligence practitioner. This is all about building trust, so erring on the side of over-communicating is a competitive intelligence best practice. Especially at first. That means getting your stakeholders involved early whenever you start a new project. **This helps for a few reasons:** 1. Gives stakeholders an opportunity to voice concerns. 2. If it’s another group kicking off the project, you can be there while they’re defining the objective or research question. 3. Helps to build trust and mutual respect. Both essential for a healthy ongoing working relationship. ### 2) Show your work Many of CI’s outcomes aren’t so easy to measure. So if you want career progression, you might need to work a little harder than some of your colleagues to prove your value when your next annual review rolls around. This is especially true if yours is a business that undervalues competitive intelligence. So it’s a competitive intelligence best practice to dedicate a portion of your time towards evidencing the value you’ve brought to the company and the revenue you’ve been a part of generating. **Clearly track things like:** - The **won deals** you’ve directly contributed to. - How many teams are asking for training and **enablement sessions** from you. - The projects other people are pulling you into, and the **success of those projects.** If you can supply the breadcrumb-lined path that shows how *your* actions have led to good outcomes, you’ll make it that much easier for your boss to agree to a pay rise. ![](https://www.competitiveintelligencealliance.io/content/images/2023/09/asana.webp) **A simple project management tool can serve as a great starting point to begin tracking your work and your value contributions to your business. Credit: asana.com* ### 3) Start with your sales team As we mentioned, building trust is huge. That starts with getting small wins, and building on that momentum to seize bigger wins over time. Your sales team is a key stakeholder both early on and even after your CI program matures. 💰 In the beginning, sales presents perhaps the most measurable means of contributing to company revenue. When you enable the sales team, and help them generate success, you’ll also build trust in your own abilities and in your CI program’s ability to drive positive change for the business. Soon, other teams will come on board, and you’ll have earned your seat at the table with leadership, marketing, and product teams. ### 4) Orient yourself first Sure, start with sales when you’re ready to launch your CI program in earnest. But the very first thing to do when you land in a new competitive intelligence role is to *orient yourself.* If your predecessor left behind a competitive intelligence program, best practice says to start by assessing the damage. What do you have in place that’s working? What *isn’t* working? And, if there’s nothing in place at all, you have the benefit of starting with a clean slate. But if it’s your first time, blank slates can feel a bit… daunting. For that reason, whichever scenario you find yourself in at first, it pays to orient yourself right away. **That means:** 1. Learning the **business’ goals**, and the aspirations of your leaders. 2. Figuring out what competitive intelligence **exists already**. In the heads of your peers, in your CRM, or even scribbled in notebooks in the drawers of your salespeople. 3. Learning what **competitive content** people like, and what they’re using most right now. Take the lay of the land. Figure out where you are. That’s point A. At the same time, tease out what direction your leaders want the business to head in. That’s point B. With point A and point B firmly in mind, you can start drawing up a plan for how to get there. ![](https://www.competitiveintelligencealliance.io/content/images/2023/09/gcal.png) **Your first week doesn't need to look like this, but to orient yourself effectively, you will have to set up some meetings. Credit: research gate.* ### 5) Prioritize, prioritize, prioritize It’s just a fact. It’s impossible to succeed in competitive intelligence without learning to prioritize. Competitive intelligence teams are often small. Resources are often limited. And budgets are often tight. Yet, with so many possible stakeholders (every department in the business can benefit from competitive intelligence in some way), you’re bound to get too many requests to deal with. Since there aren’t enough hours in the day for you (or your small team) to do everything, you have to pick your battles. **That means prioritizing on everything, including:** - Which **competitors** you’ll dedicate resources to monitoring, reporting on, and trying to beat. - Which **departments** you’ll dedicate resources towards enabling, informing, and helping. - Which **projects** you’ll spend time contributing to. - Which types of **content** you’ll spend time producing. Knowing what to prioritize and what to bump into the “later” pile comes down to being aligned with the goals of the business. See the section on ‘orienting yourself’ above. --- [How to predict revenues using machine learningThis article looks at how machine learning can help FP&A teams achieve increased precision in budget forecasting.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceGabriela Gutierrez![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/cristiano-firmani-tmTidmpILWw-unsplash--1-.jpg)](https://www.financealliance.io/the-future-of-fp-a-how-to-predict-revenues-using-machine-learning/) --- ## Competitive intelligence tools We’ve said it before, but the internet’s a big place. Competitive intelligence software and tools can mean the difference between missing key developments and staying one step ahead. And it doesn’t have to cost the world either. Free tools like Google Alerts can save the day when you’re out of budget. But for those with the dollars to spare, investing in the following types of tools empowers you to rapidly scale your CI program and squeeze out every last drop of its value. ![Dashboard of a competitive intelligence tool](https://www.competitiveintelligencealliance.io/content/images/2022/09/Screen-Shot-2022-09-08-at-13.59.14-1.png) **Competitive intelligence tools help you gather, centralize, and draw insights from data.* ### Competitive intelligence software Competitive intelligence software exists to make your life easier. These tools accept a list of competitors, and they’ll monitor the web in real-time for mentions of them. That means minimal delay between a competitor’s product launch or announcement and you knowing about it. ### Social listening tools In the other direction, you can get narrower by using a social listening tool. 👂 Rather than scanning the entire web for mentions of a competitor, these tools will scan social media platforms. These are life-changing for organizations relying on influencer marketing and social media marketing strategies. ### Market intelligence tools Like competitive intelligence software, but for the wider marketplace. The easiest way to understand the difference is to think of industries with only a few very strong competitors, but where both emerging and legacy players still hold a large portion of the market share. Netflix, for example, competes closely with Amazon Prime Video and a number of other streaming service providers. But they also compete indirectly with the cable TV providers, movie theaters, and even with YouTube for people’s viewing attention. If your organization wants intel on the wider market and its indirect competitors, they’ll benefit from a market intelligence platform. ### CRMs Chances are your organization already uses a CRM. Customer relationship management systems like these are the cornerstone of many a sales program, and for good reason. A central store for everything customer- and sales lead-related, your CRM is a fab resource for gathering competitive intelligence from your sales reps. But it’s also a good place to keep your enablement assets. Hey, your sales reps spend all day in there anyway. It’s like leaving a bowl of steaming spag’ bol’ outside your teenager’s bedroom door. You know they appreciate it, even if they don’t say so. 🍝 ### Sales enablement platforms Sales enablement platforms take the enablement function of a CRM and offer a dedicated solution for it. Once you’ve created a framework for your sales reps that works, you can deliver it to them, track its success, and see key metrics for what’s working and what’s not. Not enough for ya? Sales enablement tools also identify new opportunities and prospects, giving you ways to engage with them meaningfully while providing plenty of juicy data. 🍋 ### Conversational intelligence software Conversational intelligence software uses AI to analyze calls, emails, and text chat messages between sales reps and prospects. For organizations with humongous call volumes, this makes deriving insights from conversation data scalable. And it helps you improve your buyer experience and boost conversions. 🤩 To give your data context and make next steps easier, your conversation intelligence software integrates with the other tools in your stack, including your CRM. How helpful! ### Win/loss platforms Win/loss platforms offer supporting solutions for your win/loss research. They’ll automate this crucial part of the data gathering process for you so you can set and forget it. Nice and easy. 🙌 Since it’s always on, you’ll never miss an opportunity to gather actionable insights from newly won or lost prospects either. And the platform will give you the data you need to tweak and hone your surveys for best results. Basically, win/loss platforms let you be lazy with a very important part of your CI process. If you’re up to your eyeballs, or if you just like to automate tasks like this, grab ya’self a subscription to some win/loss software. You won’t regret it. ## Competitive intelligence ethics [The ethics of competitive intelligence](https://www.competitiveintelligencealliance.io/competitive-intelligence-ethics/) isn’t a shadowy subject hounded by shades of gray. So long as you don’t enter the realms of corporate espionage or illegal activity (like wiretapping your rival’s phone lines or cracking their customer database), you’ll be on the right side of the ethical divide. Information from publicly available sources is all you need to succeed. Customer reviews, competitor press releases, announcements, social media posts, and even published financial statements. All of these are legal and ethical sources of intel on your competitors. In fact, you’ll probably struggle to keep up with all of it, which is why automation via competitive intelligence tools can be so powerful. But developments can be subtle, and the signs often lie in small departures from baseline behavior. That’s why it’s so important to ID that baseline and become intimately familiar with your core competitors. The ones that represent your greatest opportunities. ### Don't let time steal your profits: How to reduce your time to value metric in SaaS URL: https://www.financealliance.io/time-to-value-metric/ Last updated: 2024-03-13T15:01:40.000Z If you’re in *any* finance profession, you’ll know that time is money. Every day that passes without your customers realizing the full value of your product is a day of lost revenue. To stop (or at least *reduce*) the chances of that happening, you need to reduce your time to value (TTV) metric. A lengthy time to value can be a silent killer for SaaS businesses. Customers who don't see results quickly lose momentum, leading to increased churn, stunted growth, and ultimately, a negative impact on your bottom line. On the other hand, a shorter TTV means faster profits, happier customers, and a competitive advantage in the market… but how can you reduce time to value? ![](https://media.tenor.com/2WtBkf2YI00AAAAC/bean-mr.gif) Keep reading as we cover actionable steps to help you reduce your TTV and turn hesitant customers into loyal advocates – all while strengthening your financial position. ## **What is the time to value metric?** ⏰ The time to value metric measures how long it takes for a customer to start experiencing the benefits (value) of a product or service. Tracking TTV provides a window into how quickly (or slowly) customers [unlock the value](https://www.financealliance.io/value-creation-plan/) of your product. Knowing your time to value metric helps make it easier to refine and adjust your strategies and processes appropriately. By reducing TTV, you unlock [faster revenue streams](https://www.financealliance.io/the-future-of-fp-a-how-to-predict-revenues-using-machine-learning/), enhance customer satisfaction (leading to higher retention rates), and ultimately, optimize business efficiency – all factors that contribute to a healthier bottom line. ## How to calculate time to value Calculating the time to value metric is pretty simple, especially when you follow these steps: 1. **Mark the start date**: This is when a project, product, or service is first introduced to the customer. It could be the purchase date, the day they sign up, or the day they first log in or start using what you offer. 2. **Identify the 'value moment'**: Think about the point when the customer first realizes significant benefits from the product or service - this is the 'value moment'. For example, achieving a certain outcome or hitting a milestone. 3. **Record the value date**: This is when the customer achieves that significant benefit or value. 4. **Calculate the duration**: To find the TTV, simply calculate the time between the start date and the value realization date. If your customer signed up for your service on April 1st and realized significant value on April 18th, your TTV is 17 days. --- [21 CFO pain points and challenges 2024In this blog post, we cover 21 of the biggest CFO pain points and challenges in 2024, why they’re tricky, and how to overcome them.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/03/CFO-pain-points.jpg)](https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/) --- ## **Why TTV matters in finance** The time to value metric is more than an indicator into customer satisfaction and churn. It also serves as an important metric to help make informed decisions that directly influence the company’s financial health. So, here’s a few reasons why TTV matters in finance: ### **Investment decision-making** Time to value acts as a key metric when [evaluating potential investments](https://www.financealliance.io/cfos-role-in-investor-communications/), *especially* in SaaS ventures. A shorter TTV hints to a faster return on investment (ROI) as customers realize value quicker. You can use this info to prioritize investments with a proven ability to generate revenue quickly. 💸 ### **Cash flow management** A long wait means your income comes in slower. By keeping an eye on TTV and shortening it, you can better predict how much money is coming in at different times. This helps you to [allocate resources](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) wisely, like making sure there's enough cash on hand to pay bills and avoid any financial hiccups. ### **Performance evaluation** TTV serves as a valuable benchmark for assessing the overall effectiveness of a product or service. By looking at TTV alongside other [financial metrics](https://www.financealliance.io/tag/finance-metrics/), you can see how much money you're getting back from the money you spend on marketing and sales. This lets you make adjustments to get the most out of your resources and boost your profits. ### **Strategic planning** A clear understanding of your time to value metric helps with [strategic planning](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/). By considering the time it takes for customers to see value, you can create more realistic financial projections and develop long-term strategies that account for the cost of customer acquisition and retention. ### **Risk assessment** A lengthy TTV can pose a significant [financial risk](https://www.financealliance.io/risks-of-mergers-and-acquisitions/). If it takes too long for customers to see value from a product, they might get frustrated and stop using it altogether. This can be risky for the company's finances because it means losing potential income from those customers. By focusing on making the product's value clear and easy to experience quickly, you can help reduce the risk of customers leaving and protect the company's financial health. --- [The CFO’s crash course in finance and complianceGovernance, risk management and compliance. These aren’t exactly the most exciting aspects of a CFO’s role, but that doesn’t stop them from being vital areas of focus. 🎯![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/finance-and-compliance.jpg)](https://www.financealliance.io/finance-and-compliance/) --- ## **Types of TTV** There's more than just one type of time to value metric, so here’s a simple breakdown of each one and what it means: - **Immediate time to value:** This refers to situations where customers experience the product's benefit instantly, like using a free online tool that delivers a specific result. - **Time to exceed value:** This one measures the time it takes for customers to discover the product's full potential and unlock additional functionalities or benefits they might have overlooked at first. - **Long time to value:** We mentioned this one a few times already and it refers to when there's a lengthy period before customers experience the product's value, which can lead to increased churn. - **Time to basic value:** This focuses on the time it takes for customers to experience the basic functionalities and intended purpose of the product. - **Short time to value:** Customers see the core value proposition of the product quickly, typically within days or weeks, leading to initial satisfaction and continued use. --- ## How to minimize your time to value metric Imagine customers paying you faster and staying happy longer. That's the magic of reducing your time to value metric. As a finance professional, you know time is money, and a long TTV means lost revenue. Here are some tips to shorten that wait time and boost your company's financial health: ### **1\. Make it easy to get started** Think of onboarding like welcoming a new guest. You want to make the experience as seamless as possible by offering: - **Clear instructions:** Provide simple, step-by-step guides and tutorials that walk users through the product's core features. - **Helpful resources:** Offer readily available FAQs, support articles, and even short explainer videos to answer common questions. ### **2\. Focus on quick wins** Highlight the **immediate benefits** customers can experience. You might want to consider things like: - **Free trials:** Offer limited-time free trials that showcase the product's value proposition quickly. - **Pre-configured settings:** Set up the product with some basic features already activated so customers can see the results right away. ### **3\. Track customer progress** Keep an eye on how your customers are doing and monitor their progress closely to see how they interact with the product and identify areas where they might get stuck. Another good way to reduce your time to value metric is by gathering feedback. Ask customers directly through surveys or chats if they're finding value and offer assistance if needed. 💡 Break down the customer's path to value into distinct ****milestones**. Identify the key steps, actions, and data points that signal progress. This value mapping enables targeted interventions and resource allocation. ### **4\. Invest in a strong customer success team** Having a team readily available to answer questions and address concerns can significantly shorten the time it takes for customers to feel comfortable and successful. However, don't wait for customers to reach out. The support team can proactively check-in with new users and offer guidance as and when needed. 💡 Tie customer success team incentives directly to time to value reduction goals. This promotes laser-focus on rapid value realization and sustainable revenue streams. ### 5\. Quantify the value Work closely with product and sales teams to quantify the expected value of your SaaS offering in concrete financial terms (cost savings, revenue increase, etc.). This will help you to set clear targets and measure progress towards realizing that value. 💡 Implement systems to ****automatically track customer usage** patterns, feature adoption, and other value indicators. This data-driven approach allows proactive interventions and continuous TTV optimization. ### 6\. Prioritize value-based pricing Think about transitioning to a value-based pricing model where customers pay based on the quantified value received rather than a one-size-fits-all subscription fee. By linking pricing to the value customers experience, you incentivize them to maximize their usage and discover the product's full potential faster. This not only reduces TTV but also creates a stronger perception of the product's worth (and hopefully leading to increased customer satisfaction and higher long-term revenue). ### 7\. Foster a value-centric culture Embed the importance of the time to value metric across the company, from product roadmaps to marketing campaigns. A value-first mindset accelerates time-to-revenue and long-term profitability. When each department functions with TTV in mind, the customer journey becomes seamless and efficient. This translates to: - **Faster time-to-revenue:** Customers see the value proposition quicker, leading to increased sales and recurring income. - **Long-term profitability:** Satisfied customers with a shorter TTV are more likely to stick around, contributing to sustainable business growth. --- By implementing these strategies, you're not just helping customers experience the product's value faster, you're also: - **Boosting customer satisfaction:** Satisfied customers are more likely to stick around and become loyal users. - **Increasing revenue:** Faster value realization translates to quicker subscription conversions and recurring income. - **Improving financial forecasting:** With a shorter TTV, you can predict [cash flow](https://www.financealliance.io/cash-flow-drivers-in-a-business/) more accurately and make better financial decisions. Remember, a happy customer is a paying customer, and reducing TTV is a win-win for everyone. --- ### FAQs: Time to value metric What is the time to value (TTV) metric in SaaS? In SaaS (Software as a Service), TTV measures how quickly customers can start benefiting from the service after they've signed up or started using it. It's about speed and efficiency in delivering value. What is a good time to value? A "good" TTV is one that meets or exceeds industry standards and customer expectations. It's short enough to keep customers engaged and satisfied but realistic for the company to achieve consistently. What is an example of a time to value metric? An example of a TTV metric might be the number of days from a customer subscribing to a cloud-based CRM platform to when they successfully run their first marketing campaign using that platform. How is TTV measured? TTV is measured by calculating the time duration from the start of a specific initiative (like product signup, implementation, or deployment) to the point where the customer realizes value from it. What is the goal of time to value? The goal of TTV is to minimize the time it takes for customers to derive value from a product or service, enhancing customer satisfaction, loyalty, and potentially leading to faster revenue growth. How do you minimize time to value? Minimizing TTV involves streamlining processes, enhancing customer onboarding, improving product usability, and ensuring clear communication to quickly guide customers to valuable features or benefits. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### 21 common CFO pain points and challenges URL: https://www.financealliance.io/21-cfo-pain-points-and-challenges-2024/ Last updated: 2025-11-04T10:37:46.000Z Being a CFO is no easy feat. You’re always on the lookout for ways to save money, make smart investments, and build accurate forecasts - the list goes on. It's a demanding job, that’s for sure. And 2024 is throwing even *more* curveballs your way. From staying on top of new tech to dealing with a tough economy, there's no shortage of CFO challenges to prepare for. In this blog post, we cover 21 of the biggest CFO pain points in 2024, why they’re tricky, and how to overcome them. ## **1\. Leading transformation** Leading a company through a [major transformation](https://www.financealliance.io/what-is-finance-transformation/) can be unpredictable, chaotic, and frankly, stressful. As a CFO, spearheading this kind of change can be especially daunting. The truth is that if you want to keep up with competitors, transformation isn’t optional. New technologies, changing customer demands, and economic shifts all push companies to adapt and evolve. This means it might be time to step *outside* your comfort zone a bit. ![](https://media.tenor.com/KH6NJRDWZ6sAAAAC/nervous.gif) Yes, your main focus is to keep the company financially healthy, and diving headfirst into a huge change can feel risky. However, according to [Gartner’s report](https://www.gartner.com/en/finance/trends/finance-top-priorities-for-cfos), leading transformation efforts is the number one priority for CFOs in 2024\. Here are some tips to help you lead your team through transformation: ### 🔎 **Shift your perspective** Think of transformation as an investment in the company's future, not just a risky expense. Look for ways to quantify the potential benefits – increased efficiency, cost savings, or new market opportunities. ### 🤝🏽 **Embrace collaboration** Leading change isn't a solo act. Partner with other departments to understand their needs and concerns. This collaborative approach fosters buy-in and helps ensure the transformation aligns with the overall business goals. ### 🤖 **Become tech-savvy** Technology is often at the core of many [finance transformations](https://www.financealliance.io/your-guide-to-finance-transformation/). Don’t worry, you don’t have to suddenly become a tech expert overnight. But it’ll help if you take some time to understand new technologies and their financial implications. Doing so will help you to make informed decisions about their implementation. --- ## **2\. Cutting costs** Our [Pro members](https://www.financealliance.io/signup/) constantly tell us that finding ways to trim the budget (*without causing an office riot*) is a major headache for them. Striking the right balance between efficiency and growth is important, but it's also one of the biggest CFO pain points of 2024\. Cutting too much can stifle innovation, while not cutting enough can put the company's financial health at risk. So, how can you approach this with the least possible amount of fallout? Well, it’s all about strategic cost-cutting. Rather than slashing budgets across the board, focus on identifying areas where spending can be optimized *without* impacting core operations. This could involve: ![CFO pain points - 3 ways to cut costs](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/CFO-challenges.png) Remember, successful cost-cutting isn't just about saving money, it's about investing in the future. When it comes to CFO challenges, overcoming issues associated with cutting costs should be one of your top priorities. --- ## **3\. Identifying investments with growth potential** As a CFO, you know the importance of [making smart investments](https://www.financealliance.io/cfos-role-in-investor-communications/) that fuel your company's growth. However, with so many choices available, how do you distinguish the best from the rest? Identifying investments with growth potential can be a real challenge. There's always the risk of picking something that turns out to be a dud, which can put your company's financial future at stake. Plus, who has the time to research every single investment opportunity out there? Here are some tips to help you identify investments with the most potential to drive growth: - **Evaluate market trends:** Keep your eyes peeled for the latest buzz – new technologies, changing customer habits, and even government regulations. Investments that align with these trends are more likely to see significant growth. - **Scope out the competition:** Look for areas where your competitors haven't yet claimed their territory. If you can stake your claim first, you'll have a head start capturing market share. - **Tap into the team:** Chat with the folks on the front lines – your sales team, business unit leaders, etc. They often have their ear to the ground and can point you toward promising investment opportunities. - **Analyze growth rates:** Look for areas, segments, and products where your business is already seeing the highest expansion. Focusing more resources on departments already experiencing strong growth can be a smart way to do just that. It leverages what's already working and can ease some of those CFO pain points by building on a foundation of success. - **Listen to your customers:** Pay attention to customer feedback and identify unmet needs or desires. If there's a demand for something you don't currently offer, that's a potential goldmine. - **Do the math:** Don't just rely on gut feeling (although that can be valuable too!). Build financial models that consider market size, potential costs, profit margins, and breakeven points. --- ## **4\. Supply chain disruptions** Ever seen a perfectly good budget thrown off by a supply chain snag? This is a common issue these days, and it can be a real pain. Welcome to the world of supply chain disruptions, a major pain point for CFOs everywhere. These disruptions, caused by factors like worker shortages, lack of materials, and slow shipping can mess with everything. Costs go up, you have less stock to sell, and predicting sales becomes a guessing game. Not good for the company's bottom line! So, what can you do to navigate these financial roadblocks? First, diversify your sourcing to minimize the impact of single disruptions, just like you diversify investments to reduce risk. This strategy can be crucial in managing CFO pain points related to supply chain vulnerabilities. Next, work on improving supplier relationships. Having a strong relationship with your suppliers can keep you informed of potential issues and help you work together to find solutions that minimize financial strain. Remember to factor in potential supply chain disruptions when forecasting costs, revenue, and cash flow. This helps you anticipate financial challenges and [prepare contingency plans](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) to mitigate their impact. --- [5 supply chain risk mitigation strategies to dodge disasterHow can you mitigate supply chain risks as effectively as possible? Find out in this article, where we explore five key supply chain risk mitigation strategies to help you steer your company toward financial stability and resilience.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/06/supply-chain-risk-mitigation-strategies-2.png)](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) --- ## **5\. More accurate forecasting** Industry research shines a spotlight on the importance of preparing for the unexpected. [90% of senior finance leaders](https://www.concur.co.uk/resource-centre/ebooks/cfo-insights-top-priorities-cfos-2024) agree that their key task in 2024 is to prepare their businesses for unforeseen events. And what better way to equip yourself for the unexpected than with [accurate forecasting](https://www.financealliance.io/4-proven-methods-for-accurate-sales-forecasts/)? However, achieving pinpoint accuracy in an environment riddled with uncertainties can feel like chasing a moving target. From fluctuating economic conditions to evolving consumer preferences, the factors influencing a company's financial performance are constantly in flux. This presents a significant challenge for CFOs. They need reliable predictions to make important choices, plan spending wisely, and keep the company running smoothly in the long run. When everything gets thrown off, it makes their job way harder. For more accurate forecasts, make sure to: ![CFO pain points - more accurate forecasting tips](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/CFO-pain-points.png) --- ## **6\. Capital costs** Capital costs usually rank high on the list of CFO pain points and it’s not much of a surprise when you think about it. For CFOs, managing capital costs feels like a constant game of chess - strategically balancing investments for growth against the need for financial stability. Not to mention those rising interest rates can significantly increase borrowing costs for essential equipment, expansion projects, or even routine operations. This can squeeze profit margins and limit your ability to invest in strategic initiatives. To overcome some common CFO challenges around capital costs, it’s a good idea to: ✔️ Scrutinize **capital expenditures**. ✔️ Explore **alternative financing** options. ✔️ **Negotiate** for better terms on loans, interest rates, and payment schedules. ✔️ Optimize **cash flow** management. --- ## **7\. Profitability** One of the biggest CFO challenges is an obvious one and that’s *profitability*. The profitability of a company stands as the ultimate measure of success. It incorporates a blend of countless decisions, strategic maneuvers, *and* a constant battle against shifting market dynamics. No matter the industry, everyone's dealing with two big problems: 1. Costs are going up, making it harder to make money. 2. Customers are changing their minds all the time, which means companies need to constantly adapt and fight hard to stay ahead of the competition. To address these challenges, you need to be financial stewards and [strategic partners](https://www.financealliance.io/how-to-get-started-with-finance-business-partnering/), working across departments to identify cost savings, drive efficiency, and develop innovative strategies that capture market share and solidify your company's leadership position. --- ## **8\. Cash and liquidity planning** Keeping operations running, paying the bills, and seizing opportunities as they come up are all top priorities for finance leaders. However, balancing incoming funds with outgoing payments isn’t always easy, so cash and liquidity planning is so important. Despite its importance, this area remains one of the most persistent CFO pain points due to things like sales fluctuations, unexpected expenses, and unpredictable market shifts. Planning cash and liquidity right helps you anticipate future cash inflows and outflows, preventing unexpected shortfalls that can derail strategic plans. It allows them to make informed decisions and manage financial stability more effectively. --- ## **9\. Make the most of technology and automation** According to the [PwC Pulse Survey](https://www.pwc.com/us/en/executive-leadership-hub/cfo.html), a whopping 88% of CFOs say they struggle to capture value from their technology investments. So, why the disconnect? Firstly, choosing the right technology can be daunting. With a never-ending stream of options, it's easy to get overwhelmed and make costly mistakes. Secondly, integrating new technologies with existing systems can be time-consuming and disruptive, requiring a lot of resources and expertise. Finally, changing mindsets and fostering a culture of adoption can require patience. Not everyone is ready to embrace change, and navigating resistance within the organization can be an uphill battle. ![](https://media.tenor.com/oQE4GfwwSPwAAAAC/on-my-way-struggle.gif) **Cute puppy for motivation 👀* Here are some quick-fire tips to help you get to grips with technology investments: ### 🗂️ **Clearly define your needs** Before diving into the tech pool, understand your specific problems and desired outcomes. What are you hoping to achieve with technology? This helps you choose the right tools for the job, not just the shiniest ones. ### ⚖️ **Start small and scale** Begin with implementing a single, well-defined solution and gradually expand as you gain confidence and expertise. It's like learning to ride a bike – start with training wheels and work your way up. ### 🗣️ **Seek expert guidance** Don't be afraid to consult with technology experts and consultants. They can help navigate the options, ensure smooth integration, and provide valuable training and support. This step is especially important in addressing CFO pain points related to technological advancements and ensuring your financial team stays ahead in a digital age. ### 🎓 **Embrace a culture of learning** Encourage continuous learning and skill development within your team. The more comfortable everyone is with the new technology, the quicker it will be adopted and utilized effectively. --- ## **10\. Strategic risk management** While managing everyday operations is crucial, CFOs also have their eyes peeled for strategic risks. These are [big-picture concerns](https://www.financealliance.io/10-big-picture-financial-planning-steps/) that can significantly impact the company's long-term health, like disruptive technologies, changing regulations, or economic downturns. Here’s your escape plan: - **Embrace "what-ifs"** \- *Explore different scenarios, not just sunny days, to prepare for potential disruptions.* - **Eyes on the lookout** \- *Encourage everyone to identify and report potential risks.* - **Stay adaptable** \-*Be prepared to adjust your strategies and risk management practices as things change.* --- ## **11\. Data accuracy** For modern CFOs, the problem isn't a lack of information, it's a flood of it. Sales figures, operational metrics, market trends – the constant flood of data can be overwhelming. But the real challenge lies not in the quantity, but the *quality* of that data. Inaccurate or incomplete data can lead to flawed decisions, missed opportunities, and ultimately, hinder a company's financial performance. So, how can CFOs conquer this data challenge? Here are two tips: 1. **Implement data governance:** Set clear guidelines for data collection, storage, and access. This ensures data integrity and minimizes the risk of errors or inconsistencies. 2. **Invest in data quality tools:** Technology can be a powerful ally in identifying and correcting data discrepancies. Utilize [data cleaning](https://www.financealliance.io/data-cleaning-techniques/) and validation tools to ensure the accuracy and completeness of your financial information. Remember, high-quality data is not a luxury; it's a necessity for clear financial decision-making. --- ## **12\. Unify disparate data** As we mentioned above, unifying disparate data is another major CFO pain point. The unique challenge here lies in integrating data from various sources fragmented sources - different accounting systems, spreadsheets, reports and more. As you can imagine, trying to get a cohesive, holistic view of finance is extremely difficult when the data is so disparate and disconnected. This lack of unified data hinders their ability to conduct comprehensive analyses, generate accurate forecasts, and make informed decisions. CFOs need to find ways to consolidate and integrate the financial data into a single, unified view to truly understand the state of the business. ![Single source of truth graphic with icons representing data sources](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/Single-source-of-truth-graphic.png) By addressing this challenge and creating a **single source of truth**, CFOs can unlock the full potential of their data and gain a clearer picture of their financial position. --- ## **13\. Attracting and keeping talent** Building a [dream finance team](https://www.financealliance.io/how-to-make-your-finance-team-lean-5-principles-of-lean-finance/) is a mission on its own. The finance function demands a unique blend of technical expertise, analytical prowess, and strategic thinking. Finding people who possess these qualities, alongside a strong work ethic and cultural fit, is no easy feat. This is why attracting and keeping [top finance talent](https://www.financealliance.io/finance-talent/) remains one of the most significant CFO pain points. Thankfully, we’ve got some tips to help you out in this blog post: [10 proven tips to retain top finance talentWhat can you do to keep your best employees happy and prevent them from becoming a flight risk? Here are 11 easy but effective ways to help retain your best finance talent.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/09/finance-talent.jpg)](https://www.financealliance.io/finance-talent/) --- ## **14\. Preventing fraud and prioritizing cybersecurity** CFOs are often responsible for [risk management](https://www.financealliance.io/financial-crime-risk-management-fcrm/), which can include [fraud prevention](https://www.financealliance.io/financial-crime-risk-management-fcrm/) and cybersecurity. Here's why this matters: ### **Financial losses** Fraud can inflict a significant financial blow. Internal embezzlement or external hacking can siphon off funds, impacting everything from profitability to cash flow. ### **Reputational damage** A data breach or exposed fraud scheme can severely damage a company's reputation. Customers lose trust, investor confidence plummets, and attracting future talent becomes harder. Think of a once-trusted brand becoming synonymous with a security lapse – not a good look. ### **Regulatory fines** Depending on the nature of the fraud or cyberattack, companies can face hefty fines from regulatory bodies. These penalties can add insult to injury, further straining the company's financial resources. CFOs are on the front lines of fighting fraud and cyberattacks. By investing in security measures, tightening internal controls, and making everyone security-conscious, they can significantly lower the chances and damage caused by these threats. Want more tips and insights into the [CFO’s role when it comes to cybersecurity](https://www.financealliance.io/cfo-cybersecurity/#cfo-cybersecurity-checklist%F0%9F%91%87)? If so, read our blog post on this topic: [CFO cybersecurity: What’s the CFO’s role in cybersecurity?From crunching numbers to combating cyber threats, the role of the CFO has leaped into uncharted territory, making CFO cybersecurity one of the hottest topics in boardrooms across the globe.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/05/CFO-cybersecurity-2.jpg)](https://www.financealliance.io/cfo-cybersecurity/#cfo-cybersecurity-checklist) And, as a bonus, here’s a handy CFO cybersecurity checklist.👇 ![CFO pain points - cybersecurity](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/03/data-src-image-21e29021-792e-409f-9a80-b1b777844e59.png) --- ## **15\. Improving cash flow** Keeping finances afloat is one of the biggest CFO challenges of 2024\. Things can change quickly. Sales dip, customers pay late, or costs rise, disrupting even the best plans. Cash flow is important because it gives a company financial stability. Having enough cash allows you to take calculated risks and pursue growth opportunities. It also helps to build investor confidence because strong flow shows financial health and makes supporting your growth more appealing to investors. There are some things you can do to help improve cash flow such as encouraging timely payments from customers. This will help reduce delays. Another strategy is to manage inventory carefully and avoid stockpiling, which ties up cash. --- [7 important cash flow drivers in a businessCash flow drivers are vital to sustaining the life of a business. When cash flow is low, a string of issues arise. From struggling to pay suppliers to potential solvency problems, low cash flow must be avoided at all costs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/03/cash-flow-drivers-in-a-business.jpg)](https://www.financealliance.io/cash-flow-drivers-in-a-business/) --- ## **16\. Support a remote workforce** Remote work has become the ‘norm’ for many of us following the impact of COVID-19 on the workforce. But for CFOs, managing a remote workforce presents a unique set of challenges: **Communication and collaboration:** Effective communication is vital for any team, but with geographical distance, fostering collaboration and maintaining a strong company culture can be more difficult. **Technology and security:** Equipping employees with the necessary technology and ensuring robust cybersecurity measures are crucial for remote work success but can also add unexpected costs. Supporting a remote workforce requires a shift in mindset for CFOs. This involves prioritizing investments in collaboration tools and virtual meeting platforms. Cybersecurity protocols should also be regularly reviewed and updated to safeguard against threats. You can also help promote a positive remote culture by encouraging virtual social events, providing mental health resources, and offering flexible scheduling options to boost employee engagement and productivity. --- ## **17\. Manage taxes and regulation** Managing taxes and [regulatory compliance](https://www.financealliance.io/finance-and-compliance/) is one of the major CFO pain points that keeps popping up. As businesses expand across different states and countries, the tax and regulatory landscape becomes even more difficult to manage. Staying on top of constantly evolving tax laws, filing requirements, and reporting obligations across multiple jurisdictions is a daunting task. ![](https://media.tenor.com/DtopVisvlx4AAAAC/tax-doing-taxes.gif) Failure to comply can result in hefty fines, penalties, and damage to the company's reputation. CFOs must ensure that their teams are well-versed in the intricate details of tax codes and regulations, which often require specialized expertise. To alleviate this burden, CFOs can invest in tax management software and outsource to reputable tax advisory firms. These solutions can automate tax calculations, filings, and reporting, reducing the risk of errors and freeing up internal resources to focus on strategic initiatives. --- ## **18\. Move toward ESG reporting** Almost a [third of CFOs](https://www.pwc.com/us/en/executive-leadership-hub/cfo.html) are analyzing how climate change scenarios could impact financial performance. They're analyzing how different climate scenarios, from rising sea levels to extreme weather events, could impact their company's bottom line. While this might seem like an unexpected challenge for financial leaders, it highlights a growing area of concern – Environmental, Social, and Governance (ESG) reporting. So, what is [ESG reporting](https://www.financealliance.io/the-evolving-role-of-fp-a-in-esg-planning-and-reporting/)? ESG is the process of disclosing a company's impact on the environment (environmental), its social responsibility practices (social), and its governance practices (governance). This includes metrics like carbon emissions, employee diversity, and board composition. While ESG reporting offers benefits like attracting responsible investors and enhancing brand reputation, it also presents several difficulties: ### **Evolving standards** ESG reporting standards are still under development and can vary by industry and region, making it challenging to maintain consistency and transparency. ### **Data collection and analysis** Gathering and analyzing the necessary data from various sources across the organization can be time-consuming and resource-intensive. ### **Integration with existing reporting** Integrating ESG reporting with existing financial reports can be complex, requiring adjustments to existing systems and processes. But there’s hope! CFOs can tackle these ESG reporting challenges by: 💻 **Getting techy:** *Data software can help gather and analyze information, saving them tons of time and headaches.* 🌿 **Finding ESG experts:** *Partnering with specialists can provide valuable guidance and keep them on top of the latest standards.* 💬 **Talking it out**: *Open communication with investors, employees, and communities helps them understand what matters most to these groups.* 👣 **Taking it one step at a time:** *Starting small with a few key metrics allows them to build their expertise and resources before diving headfirst.* --- [7 key benefits of ESG investing | Finance AllianceIn this article, we’ll discuss the key benefits of ESG investing and why ESG investing has become such a game-changer in modern finance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/06/benefits-of-esg-investing-2.jpg)](https://www.financealliance.io/7-benefits-of-esg-investing/) --- ## **19\. Lacking insight into customer behavior** CFOs who lack insight into customer behavior can't see: - What products resonate - How pricing impacts buying decisions - Which marketing channels are most effective This gap in understanding is a critical CFO pain point as it makes it difficult to predict future demand, optimize pricing strategies, and allocate budget and marketing resources properly. Without insights into these areas, CFOs are navigating in the dark, potentially missing out on opportunities to enhance revenue and profitability. --- ## **20\. Ensure compliance** [PwC’s](https://www.pwc.com/us/en/library/pulse-survey/business-reinvention/cfo.html) advice to CFOs is to: > *“Think beyond compliance and focus on long-term value. CFOs can help lead the company in building greater resilience and stakeholder trust.”* PwC's advice to "*think beyond compliance*" hits the nail on the head for today's CFOs. While ensuring compliance is crucial, it shouldn't be the sole focus. Instead, CFOs can leverage a compliance-focused mindset as a springboard for creating long-term value. Here’s how you can do it: - Make ethical behavior natural with clear policies, training, and safeguards. Imagine a safety net catching everyone, not just a few. - Foster a sense of shared responsibility where employees own ethical conduct. This builds a stronger foundation than just [top-down](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) rules. - Collaborate with regulators openly and transparently. Think about building bridges, not walls, to foster trust and address issues proactively. - Regularly update the board and CEO on compliance risks and strategies. It's like keeping a compass calibrated on a journey – everyone needs the same map. - Stay up-to-date on changing regulations – compliance is a lifelong journey, not a destination. Think of it like learning a new language – it's an ongoing effort that opens doors. --- ## **21\. Being innovative** Embracing innovation is so important because it can help CFOs unlock new opportunities. Innovation can lead to better ways to manage finances, identify new revenue streams, and gain a competitive edge. An innovative CFO is an adaptable leader, which is key to long-term success. By fostering a culture of innovation, CFOs can prepare their companies for whatever the future holds. A good tip is to encourage your team to "think outside the box" when tackling financial challenges. This can involve: - **Brainstorming sessions:** Dedicate time for your team to explore unconventional solutions, even seemingly outlandish ideas. - **Learning from other industries:** Encourage your team to research and learn from innovative practices in other sectors, not just finance. - **Piloting new ideas:** Allocate resources for small-scale experiments to test innovative solutions and learn from both successes and failures. --- ## FAQs: CFO pain points & challenges What is the biggest challenge for a CFO? The biggest challenge for a CFO is navigating the complex and often unpredictable financial landscape, which requires balancing short-term financial health with long-term strategic goals. This involves making informed decisions amidst economic volatility, regulatory changes, and technological advancements while also managing stakeholder expectations and ensuring the company's financial integrity and growth. What are the most difficult decisions for a CFO to make? The most difficult decisions for a CFO often involve balancing risk and reward in financial investments, determining the right time for expansion or cost-cutting, and allocating capital between competing projects or departments. Deciding on strategic acquisitions or divestitures and navigating through financial crises or downturns also present significant challenges. Is being a CFO stressful? Yes, being a CFO can be highly stressful due to the high stakes involved in managing a company's finances. The role demands constant vigilance over the financial health of the organization, making critical decisions under pressure, and staying ahead of economic, regulatory, and technological changes, all while managing a team and communicating with stakeholders. What are the challenges of CFO in the retail industry? CFOs in the retail industry face unique challenges such as managing inventory levels efficiently, adapting to rapidly changing consumer behaviors, coping with thin margins, and navigating the competitive landscape. Additionally, the shift towards e-commerce requires them to invest in digital transformation while managing physical store costs. What are the pros and cons of being a CFO? The pros of being a CFO include having a significant impact on the strategic direction and success of a company, opportunities for professional growth, high compensation, and a broad, holistic understanding of the business. The cons include high stress, long hours, the burden of making tough decisions that affect the company's future, and accountability for the financial health of the organization. What are CFOs most concerned about? CFOs are most concerned about ensuring financial stability and growth, managing risks, complying with regulatory changes, attracting and retaining talent, and embracing digital transformation. They also worry about global economic uncertainties, market volatility, and the challenge of making data-driven decisions in a fast-paced environment. What are some common challenges that finance leaders face today? Common challenges for finance leaders today include digital transformation and leveraging technology to streamline operations, managing geopolitical and economic uncertainties, navigating complex regulatory environments, cybersecurity threats, and fostering a culture of innovation and agility within their teams. What are CFOs most worried about? CFOs are most worried about economic volatility, geopolitical tensions, cybersecurity risks, and the ability to adapt to rapid technological changes. They also concern themselves with maintaining compliance with evolving regulations, managing cost pressures, and ensuring their teams have the skills needed to meet future challenges. --- ## Finance Alliance Pro Membership Tired of feeling stagnant in your FP&A career? Take control and unlock your true potential with the **Finance Alliance Pro Membership.** This exclusive community is your secret weapon, connecting you with elite finance professionals and equipping you with the cutting-edge tools and resources you need to dominate the field. **Fuel your growth:** - **Engage in high-level discussions** with peers, sparking innovative ideas and expanding your perspective. - **Sharpen your skills** with access to advanced financial analysis tools and expert-curated resources. ️ - **Unlock exclusive career opportunities** within a network of **industry leaders.** **Don't just survive your career, *thrive* in it.** **Join Finance Alliance Pro Membership today!** 🎓 [Sign Up](https://www.financealliance.io/pro-membership/) ### 5 essential financial KPIs every FP&A manager should track URL: https://www.financealliance.io/5-essential-financial-kpis-every-fp-a-manager-should-track/ Last updated: 2025-11-04T10:13:18.000Z [Financial planning and analysis (FP&A)](https://www.financealliance.io/11-must-read-fp-a-books/) managers play a crucial role in driving the financial health and success of an organization. To effectively manage and guide their company's financial strategy, FP&A managers must have a comprehensive understanding of key performance indicators (KPIs). These KPIs provide valuable insights into an organization's [financial performance](https://www.financealliance.io/infographic-financial-performance-metrics/), helping FP&A managers make informed decisions and drive growth. In this article, we’ll explore five essential [financial KPIs](https://www.financealliance.io/32-cfo-kpis/) that every FP&A manager should track, highlighting their significance and how they contribute to financial success. ## Revenue growth Revenue growth is a fundamental KPI that indicates the overall health of an organization's top line. By tracking revenue growth, FP&A managers can evaluate the effectiveness of their sales and marketing strategies, identify areas for improvement, and make informed decisions regarding future investments and resource allocation. **Example:** Let's say a company had revenue of $1 million in the previous year and $1.5 million in the current year. The revenue growth can be calculated as ($1.5 million - $1 million) / $1 million \* 100 = 50%. ### Measuring business performance Revenue growth indicates the success of the company's sales and marketing efforts. Positive revenue growth signifies increasing market demand, effective customer acquisition strategies, and successful product launches. --- [FP&A salary & career path guide (entry-level to executive)Welcome to our FP&A salary and career path guide, where we map out the exciting journey from entry-level roles to the executive suite in the dynamic field of Financial Planning & Analysis (FP&A).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/FP-A-career-salary-and-path-2.jpg)](https://www.financealliance.io/fp-a-salary-and-career-path-guide/) --- ## Gross margin Gross margin is a critical KPI that measures the profitability of an organization's core operations. By monitoring gross margin, FP&A managers can assess the efficiency of production processes, pricing strategies, and cost management, enabling them to make data-driven decisions to improve profitability and maintain a competitive edge. **Example:** Suppose a company had total sales of $500,000 and the cost of goods sold (COGS) amounted to $300,000\. Gross margin can be calculated as ($500,000 - $300,000) / $500,000 \* 100 = 40%. ### Measuring business performance Gross margin measures the profitability of a company's core operations. A higher gross margin indicates efficient production processes, effective pricing strategies, and better cost management. ## Operating expenses ratio The operating expenses ratio provides insights into the efficiency and effectiveness of an organization's cost management. By closely monitoring this KPI, FP&A managers can identify areas of potential cost reduction, optimize resource allocation, and enhance operational efficiency, ultimately improving the company's bottom line. **Example:** Consider a company with operating expenses (excluding COGS) of $200,000 and revenue of $800,000\. The operating expenses ratio can be calculated as $200,000 / $800,000 \* 100 = 25%. ### Measuring business performance The operating expenses ratio reflects the efficiency of cost management. A lower ratio indicates effective resource allocation, streamlined operations, and better profitability. ### Cash conversion cycle The cash conversion cycle (CCC) measures the time it takes for a company to convert its investments in inventory and other resources into cash flow from sales. FP&A managers can use this KPI to evaluate the effectiveness of working capital management, optimize cash flow, and identify potential [liquidity issues](https://www.financealliance.io/12-proven-strategies-for-managing-liquidity/), ensuring the financial stability and [sustainability](https://www.financealliance.io/7-benefits-of-a-cash-flow-forecast-to-drive-sustainable-business-growth/) of the organization. **How do you calculate the cash conversion cycle?** Cash conversion cycle = DIO + DSO – DPO - DIO - Days Inventory Outstanding - DSO - Days Sales Outstanding - DPO - Days Payable Outstanding For example, if it takes your business an average of 14.2 days to turn over inventory (DIO = 14.2), 15.6 days to receive payment from customers (DSO = 15.6), and 17.3 days to pay suppliers (DPO = 17.3), your cash conversion cycle would be 12.5 days (or 14.2+15.6 — 17.3). ### What’s a good CCC ratio? A good cash conversion cycle is a short one. If your CCC is a low or (better yet) a negative number, that means your working capital is not tied up for long, and your business has greater liquidity. ## Return on investment (ROI) ROI is a key financial metric that assesses the profitability of investments made by the organization. By tracking ROI, FP&A managers can evaluate the success of various projects and initiatives, make informed investment decisions, and allocate resources to areas that generate the highest returns, ultimately driving long-term growth and maximizing shareholder value. **Example:** Let's assume a company invested $100,000 in a project, and it generated $30,000 in profits. The ROI can be calculated as ($30,000 / $100,000) \* 100 = 30%. --- [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/tools-pic-2.jpeg)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) --- ### Measuring business performance ROI evaluates the profitability of investments. A higher ROI indicates successful projects and initiatives, efficient capital allocation, and maximization of shareholder value. ## Conclusion Tracking the right financial KPIs is paramount for FP&A managers to effectively manage an organization's financial health and drive its success. By monitoring revenue growth, gross margin, operating expenses ratio, cash conversion cycle, and return on investment, FP&A managers can gain valuable insights into their company's financial performance, make informed decisions, and contribute to sustainable growth. These essential KPIs provide a holistic view of the organization's financial landscape, enabling FP&A managers to identify areas for improvement, allocate resources effectively, and navigate financial challenges with confidence. By leveraging these KPIs, FP&A managers can strengthen their financial strategies, optimize profitability, and ensure the long-term success of their organizations. --- ### FP&A Certified Core course: Reach your full potential Ready to improve your financial planning and analysis skills and skyrocket your career growth? Our FP&A course is your gateway to mastering the skills and know-how needed to drive strategic business growth with the power of FP&A. By the end of this course you’ll be able to.. - Build accurate forecasts - Turn data into insights - Become a business partner ….and more. [Sign up today](https://certified.thealliance.io/course/fpa-certified-core ) ### How to use Azure OpenAI 'On Your Data' in Finance URL: https://www.financealliance.io/how-to-use-azure-openai-on-your-data-in-finance-fp-a/ Last updated: 2025-04-07T09:59:57.000Z We’ve got good news – Microsoft has finally made [Azure OpenAI Service](https://azure.microsoft.com/en-us/products/ai-services/openai-service) *On Your Data* generally available! You can now leverage the power of OpenAI models, like GPT-4, with your own data. *On Your Data* incorporates the innovative capabilities of the RAG (Retrieval Augmented Generation) model, directly “*on your data*” with enterprise-grade security on Azure. This ground-breaking feature is changing how you engage with, understand, and anchor your data, delivering unmatched precision and efficiency through an intuitive chat experience. Quickly craft custom digital assistants powered by your own data to boost understanding, speed up tasks, *and* support smarter decision-making.🔥 ## **What is *On Your Data*?** The Azure OpenAI Service with its *On Your Data* feature lets you harness the power of your data by deploying OpenAI models directly, without needing any type of training or fine-tuning. This means smoother conversations, top customer service, and a big boost in how much you can get done across your team. Thanks to Azure, Microsoft's cloud powerhouse, your data stays safe and meets the high standards businesses expect. What's interesting is how it brings [OpenAI's GPT-4](https://www.financealliance.io/chatgpt-for-excel/) into the mix while keeping your privacy and security a top priority. Expanding on this innovation, the service has been engineered to deliver superior AI responses from the outset. With specialized prompt engineering and enhancements across various components like intent extraction, search retrieval, filtering, re-ranking, and data ingestion, the Azure OpenAI Service ensures that responses are not only precise, succinct, and coherent but also finely adapted to each specific model. This development speaks to a new era of AI interactions, offering unparalleled accuracy and customization in responding to user queries, further enhancing the efficiency and effectiveness of team operations. ![Azure OpenAI on your data](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/Screenshot-2024-02-29-at-12.15.52.png) Source: [**Microsoft*](https://techcommunity.microsoft.com/t5/ai-azure-ai-services-blog/on-your-data-is-now-generally-available-in-azure-openai-service/ba-p/4059514) ## **Azure OpenAI *On Your Data* capabilities** Here's a snapshot of the capabilities that have become widely available: ### **Enterprise-level security enhancements** Securely access your private Azure resources through Azure OpenAI Studio and APIs, leveraging private endpoints and VPNs for things like Azure AI Search and Azure OpenAI. Benefit from document-level access control to generate responses tailored to the documents a user is permitted to access. ### **Broader data integration** Easily link to your [data](https://www.financealliance.io/data-cleaning-techniques/) across a variety of sources, including Azure AI Search and Azure Cosmos DB for MongoDB vCore, with Azure Blob Storage, local files, and URLs/web addresses currently being tested. Additional sources are expected to be fully integrated soon. ### **Advanced information retrieval with RAG** Tap into the sophisticated RAG (Retrieval-Augmented Generation) model to significantly improve the accuracy and relevancy of information retrieval, facilitating more context-sensitive and precise conversational interactions. ### **Tailored chat experiences** Customize your interaction parameters, including response limitations and custom settings, to refine the strictness and scope of documents retrieved during conversations. ### **Enhanced data retrieval techniques** Utilize Azure AI's vector or hybrid search options for more [accurate data searches](https://www.financealliance.io/7-data-management-problems-and-solutions/), enhancing the insights derived from your data. ### **Semantic prioritization by default** Benefit from automatically re-ranked, prioritized search results thanks to the semantic ranker feature of Azure AI Search, now a standard offering. ### **Access to cutting-edge OpenAI models** Leverage a range of OpenAI models, including GPT-35-Turbo, GPT-35-Turbo-16k, GPT-4, and GPT-4-32k, to power your applications. ### **Search customization through API** Fine-tune your searches and add depth with the RAG model, targeting specific aspects of our API for a more tailored search experience. ### **Streamlined SDK updates** Integrate more smoothly with your existing systems using our enhanced SDK, designed to maximize the benefits of Azure OpenAI's *On Your Data* feature. ### **Support for multiple file types** Work seamlessly with a variety of file formats, including .txt, .pdf, .docx, .pptx, .md, and .html, to ensure compatibility and flexibility in data handling. ## **Use cases in finance and FP&A** If you’re a finance professional who wants to use Azure OpenAI Service, with its "[*On Your Data*](https://learn.microsoft.com/en-us/azure/ai-services/openai/concepts/use-your-data?tabs=ai-search)" feature, to help with things like seamless automation of financial reports, in-depth forecasting and scenario analysis, swift identification of [budget variances](https://www.financealliance.io/budget-vs-actual-variance-analysis/), and more – you’re in luck. Below, we share just a few of the possible use cases for finance and [FP&A](https://www.financealliance.io/fp-a-salary-and-career-path-guide/): ### **Automated assistance** Are you faced with complex questions from the board, CEO, or other stakeholders? You can use *On Your Data* to provide quick responses to those questions based on your data so you can find the answers to even the most difficult questions in a matter of seconds. ### **Streamlined financial reporting** This tool lets you whip up detailed [financial reports](https://www.financealliance.io/flexible-budget-performance-report/) effortlessly. It covers everything from revenue trends and cost breakdowns to profitability, all in plain language that's easy to understand. ### **Real-time document search** No time to scan through pages and pages of data and documents? No problem. Azure OpenAI Service’s *On Your Data* feature offers real-time support to help go through documents, provide answers, and offer guidance. ### **Forecasting** You can lean on the AI to test out [different financial scenarios](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/), tweaking the assumptions as you go. It gives you solid forecasts that are gold for strategic planning and keeping risks at bay. ### **Budget variance analysis** Got discrepancies between what you planned to spend and what you actually spent? Just ask the AI. It quickly sifts through your data, spotting variances and offering insights on why they happened and what they might mean. ### **Create custom dashboards** Set up your own AI-driven dashboards to keep a close eye on financial metrics in real-time. Plus, you can get alerts set up for important financial updates, so you're always in the loop without having to dig for information. --- [How to use Gemini AI with Google SheetsGoogle’s latest breakthrough in artificial intelligence, Gemini, has many finance pros anticipating its transformative potential in data analysis and decision-making.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/how-to-use-google-gemini-with-google-sheets-2.jpg)](https://www.financealliance.io/how-to-use-gemini-ai-with-google-sheets/) --- ## **Leveraging RAG for advanced data analysis** A standout aspect of the "*On Your Data*" offering is the integration of the Retrieval Augmented Generation (RAG) model, a sophisticated AI tool designed to significantly enhance data analysis capabilities. RAG blends the power of GPT-4 with a sophisticated mechanism for fetching and applying data from designated datasets. This fusion allows Financial Planning & Analysis (FP&A) professionals to navigate through extensive financial datasets using natural language queries. The model's unique strength lies in its dual ability to generate human-like responses while accessing and synthesizing data from specific sources. This means that financial analysts can ask complex questions about their data and receive detailed, understandable insights, [forecasts](https://www.financealliance.io/rolling-forecast-best-practices/), and analyses directly relevant to their query. --- ### **FAQs: Azure OpenAI Service *On Your Data*** ### What does Azure OpenAI on your data enable developers to do? OpenAI on your data empowers developers to directly apply OpenAI's powerful models, like GPT-4, to their own datasets stored in Azure. This enables the creation of customized AI solutions that can analyze, interpret, and interact with their data securely, offering personalized insights and automating complex tasks. What is the difference between OpenAI and Azure OpenAI? OpenAI is an AI research lab that develops advanced AI models, such as GPT (Generative Pre-trained Transformer) models. Azure OpenAI, on the other hand, is a cloud service provided by Microsoft that integrates OpenAI’s models with Azure’s cloud infrastructure, offering enhanced security, scalability, and integration capabilities for enterprise applications. What are the benefits of Azure OpenAI? Azure OpenAI provides several key benefits, including access to cutting-edge AI models like GPT-4 for generating human-like text, enterprise-grade security features to protect data, scalable infrastructure to meet varying demand, and seamless integration with other Azure services for a comprehensive cloud solution. How does Azure OpenAI work? Azure OpenAI works by allowing users to integrate OpenAI’s models with their own data stored in Azure. It processes queries and tasks through these models, which then generate responses or perform actions based on the data provided. This interaction is facilitated through Azure’s cloud infrastructure, ensuring security and compliance. How does the RAG model enhance data analysis? The Retrieval Augmented Generation (RAG) model combines the generative capabilities of GPT-4 with the ability to pull information from specific datasets, providing FP&A professionals with detailed, natural language insights, forecasts, and analyses as if consulting with a human analyst. What kind of insights can I gain by using "On Your Data"? You can ask complex questions in natural language to receive comprehensive financial reports, perform budget variance analyses, generate forecasts, and create custom dashboards and alerts, enabling more informed business decisions. Can I customize the AI responses and parameters? Absolutely. "On Your Data" allows for the customization of chat experiences, including limiting response length and setting custom parameters to refine search results and insights according to your needs. How does "On Your Data" impact financial analysis and reporting? It revolutionizes financial analysis and reporting by automating the generation of comprehensive reports, enhancing forecasting accuracy, and providing real-time insights and alerts, all through conversational AI. --- ## Unlock your potential with Finance Alliance Pro Membership! Are you a dedicated FP&A professional looking to elevate your career? Join our [Finance Alliance Pro Membership](https://www.financealliance.io/pro-membership/) today and gain exclusive access to a world of opportunities designed to boost your career growth. 🎉 With our Pro Membership, you'll connect with an elite community of finance professionals, engage in thought-provoking discussions, and access cutting-edge financial analysis tools and resources. 🛠️ Whether you're aiming for a promotion, seeking new challenges, or simply wanting to expand your network, our Pro Membership is your gateway to achieving your professional goals. Don't miss out on the chance to transform your career. 🎓 [Sign Up](https://www.financealliance.io/pro-membership/) ### The CFO’s crash course in finance and compliance URL: https://www.financealliance.io/finance-and-compliance/ Last updated: 2025-04-08T17:36:47.000Z Governance, risk management and compliance. These aren't exactly the most exciting aspects of a CFO’s role, but that doesn’t stop them from being vital areas of focus. 🎯 In our conversations with CFOs across various industries, we’ve noticed how their role has expanded *way* beyond managing the books and crunching numbers. Today, finance and compliance go hand in hand. 🤝🏽 These days, CFOs are navigating a maze of regulations to keep their companies on the straight and narrow. It isn’t just about balancing the books anymore. It’s about balancing them *while* tiptoeing through a regulatory minefield. This means wearing multiple hats — from strategist to compliance expert — all in a day's work. Keep reading as we break down the CFO’s role in governance and compliance – including finance and compliance challenges to avoid. ### **Topics covered:** - [Governance and compliance: What’s the difference?](https://www.financealliance.io/p/dcf36072-52fc-4a0e-a29e-b70aac613e95/#governance-and-compliance-what%E2%80%99s-the-difference) - [The CFO's role in governance](https://www.financealliance.io/p/dcf36072-52fc-4a0e-a29e-b70aac613e95/#the-cfos-role-in-governance) - [The CFO's role in compliance](https://www.financealliance.io/p/dcf36072-52fc-4a0e-a29e-b70aac613e95/#the-cfos-role-in-compliance) - [CFO compliance challenges and pitfalls](https://www.financealliance.io/p/dcf36072-52fc-4a0e-a29e-b70aac613e95/#cfo-compliance-challenges-and-pitfalls) - [Tips for staying ahead of regulatory and compliance](https://www.financealliance.io/p/dcf36072-52fc-4a0e-a29e-b70aac613e95/#tips-for-staying-ahead-of-regulatory-and-compliance) - [Measuring governance & compliance program effectiveness](https://www.financealliance.io/p/dcf36072-52fc-4a0e-a29e-b70aac613e95/#measuring-governance-compliance-program-effectiveness) - [What is compliance in financial management?](https://www.financealliance.io/p/dcf36072-52fc-4a0e-a29e-b70aac613e95/#what-is-compliance-in-financial-management) ## **Governance and compliance: What’s the difference?** Before we dive into the CFO’s role in all this, let’s back up and talk about what governance and compliance means. Corporate **governance** refers to the structures and guidelines in place for making business decisions in line with priorities, ethics, and risks, etc. It’s about promoting integrity from the top execs in the boardroom to interns filing paperwork. Now, moving onto compliance. In simple terms, **compliance** is basically ticking off the long list of rules, laws and standards that apply to how companies operate globally. We’re talking [financial reporting](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/) rules, data protection laws, tax codes, environmental standards, and so on. Key regulations on the radar today include heavy hitters like SOX ([Sarbanes-Oxley Act](https://www.investopedia.com/terms/s/sarbanesoxleyact.asp#:~:text=The%20Sarbanes%2DOxley%20Act%20of,tough%20new%20penalties%20on%20lawbreakers.)), which protects investors through strong internal controls and accuracy in financial reporting. Then there’s GDPR ([General Data Protection Regulation](https://gdpr.eu/what-is-gdpr/)), which safeguards personal data and privacy. And let’s not forget financial reporting standards like GAAP ([Generally Accepted Accounting Principles](https://www.ojp.gov/sites/g/files/xyckuh241/files/media/document/GAAP%5FGuide%5FSheet%5F508.pdf)) and IFRS ([International Financial Reporting Standards](https://rpc.cfainstitute.org/en/policy/positions/international-finance-reporting-stds)) that shape those financial statements CFOs know and love. Between potential lawsuits, fines, and lost business due to damaged reputations...non-compliance can become a massive financial sinkhole. CFOs must assess exposure to risks from potential non-compliance, while investing appropriately in audits, controls, training, and more. This careful balancing act is at the heart of finance and compliance, ensuring that the organization not only remains on the right side of the law but also operates efficiently *and* ethically. --- [5-step stakeholder communication planA stakeholder communication plan is a strategic document outlining how a company will communicate with its stakeholders.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/stakeholder-communications-pla.jpg)](https://www.financealliance.io/stakeholder-communication-plan/) --- ## **The CFO's role in governance** As we all know, CFOs play a vital strategic role when it comes to governance. CFOs often take the lead in developing governance frameworks and establish things like: - Financial controls - [Risk management](https://www.financealliance.io/financial-crime-risk-management-fcrm/) processes - Audit procedures - Compliance programs - Ethics and integrity policies - Board reporting and communications - Training and education They play a key role in finding the sweet spot for governance that meshes well with the company's unique culture and needs. But their role in governance doesn’t stop there. CFOs are the ultimate matchmakers between the board and management, crafting crisp, insightful financial reports and communicating [performance metrics](https://www.financealliance.io/esg-metrics/) and risks. A proactive CFO keeps the board *engaged* and *informed*. But wait, there's more. Most CFOs are on a first-name basis with everyone from investors to auditors. They aim to convey transparency and trust with every report they send out. Internally, they're setting the gold standard for integrity and controls without breaking a sweat. A CFO’s role in governance isn’t just about keeping the lights on; it’s about leading the charge, smoothing out the bumps, and making sure everyone’s clued in—from stakeholders to the board. Governance starts at the top. 🔝 --- [What is a CFO’s role in investor communications?A CFO’s involvement in investor communications is crucial for narrating a company’s financial story. As the top financial executive, you understand the past, present, and future of the organization better than anyone.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/pawel-czerwinski--0xCCPIbl3M-unsplash.jpg)](https://www.financealliance.io/cfos-role-in-investor-communications/) --- ## **The CFO's role in compliance** The CFO's role in compliance is all about mastering the maze of regulations that businesses need to follow. It's all about combining finance and compliance - making sure everything's legit and the company's in the clear. Here's how they do it: - **Building programs** to bake compliance into everyday operations - policies, controls, training, monitoring. - **Championing a culture** where every employee feels responsibility for acting ethically and legally. - **Liaising with auditors and regulators** to foster cooperation, transparency and trust. - **Keeping the board and CEO advised** of finance and compliance risks and strategies. - **Staying current as regulations evolve**. Compliance is not a "set it and forget it" endeavor. Through their oversight and leadership, CFOs ensure compliance is not just a box checking exercise, but a company-wide commitment. CFOs also partner with the CEO and leadership team to ensure all business units make compliance a priority. However, the *best* CFOs go beyond building compliance programs by proactively managing risk. They lead efforts to implement strong internal controls that safeguard [data privacy](https://www.financealliance.io/what-is-big-data-security-analytics/) and manage third-party risk. Detecting and preventing violations *before* they occur is the CFO's ultimate responsibility. Their stewardship helps ensure the organization has the right foundation of integrity and ethics. ### **CFO and data privacy** These days, protecting customer data is everything when it comes to integrity. And so, CFOs find themselves on the front lines of the data privacy battle, balancing finance and compliance to ensure the company's operations respect customer privacy while keeping the books straight. Safeguarding financial information and customer details from breaches and misuse falls squarely on the CFO's shoulders. This isn’t your run-of-the-mill financial responsibility, either. Navigating complex regulations like GDPR is just the tip of the iceberg. CFOs also have to work hand-in-hand with IT and legal teams to bake air-tight [data](https://www.financealliance.io/data-cleaning-techniques/) privacy into the core of the company. From investing in secure technologies to implementing meticulous policies and procedures, CFOs take the lead on risk management. Their goal is to lock down data while keeping the business healthy. --- [CFO and CEO relationship: 5 ways a CFO can support the CEOIn this post, you’ll learn what a CEO needs from their CFO, and what you can do to support the CEO on a day-to-day basis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2022/08/handshake-g5cf73343d_1920-1.png)](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/) --- ### **CFO and cyber risk management** As cyber threats get more complex, CFOs need to understand the financial impacts. It's now a key part of overall risk management. CFOs crunch the numbers on the costs of prevention ([cybersecurity](https://www.financealliance.io/cfo-cybersecurity/) software, insurance, and training). But they also estimate potential losses if breaches occur. Working with IT teams, CFOs prioritize smart investments in cyber resilience. Their goal is to not only check the compliance boxes, but also future-proof the company. By taking the lead on cyber risk strategy, including [contingency plans](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/), CFOs help ensure the company's assets and reputation are protected. ### **CFO and third-party risk management** With [supply chains](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) now circling the globe, keeping tabs on third-party partners is tougher than ever. For CFOs, vetting new partners is priority number one and involves researching their financials, compliance, and reputation. No stone goes unturned! Contract negotiation is also key. CFOs ensure air-tight terms are in place for managing risks and maintaining finance and compliance. Third-party risks may be rising, but with CFOs manning the radar, companies can proceed confidently. Their diligence and oversight keeps global supply chains secure. 🌎 --- ## **CFO finance and compliance challenges** While CFOs play a crucial role in finance and compliance, it's not the easiest part of the job. Here are some common pitfalls to sidestep: 🚇 **Tunnel vision.** Don't just focus on financial risks. [Operational](https://www.financealliance.io/operational-finance/) and compliance vulnerabilities also need your attention, so try to take a broad view. 🧠 **Knowledge gaps.** Compliance is complex. Ensure your [CFO skills ](https://www.financealliance.io/top-10-cfo-skills/)are sharp, with regular training to stay current on evolving regulations. Lean on legal and audit teams to fill experience gaps. 💬 **Communication breakdowns.** Clearly convey the *why* behind compliance to the broader team in relatable terms so everyone’s on the same page. 📋 **Undue influence.** Pushback is inevitable when instituting new controls. Hold firm on critical changes without being dismissive. 📈 **Whack-a-mole monitoring.** Don't just react to issues. Proactively self-assess, audit, and update compliance programs. Think *long-term.* --- [CFO interview questions and answersIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/08/CFO-interview-questions-2.jpg)](https://www.financealliance.io/cfo-interview-questions-and-answers/) --- ## **Tips for staying ahead of regulatory and compliance** Effective governance, risk management, and compliance require savvy CFOs to take the lead. Below, we’ve put together 12 tips to help you out: 1. Foster an ethical **culture of integrity** throughout the company. 2. Instill **risk awareness** through training and open communication. 3. Collaborate **cross-functionally**, especially with IT, legal, and audit teams. 4. **Prioritize internal controls** and monitoring via audits, self-assessments and reporting. 5. Maintain finance and **compliance knowledge**. Stay current on regulatory changes and industry best practices. 6. Report risks and compliance **metrics** clearly to the board. Keep them engaged. 7. Forge **open and transparent** relationships with external auditors and regulators. 8. Evaluate **cyber risks** and **data privacy** needs proactively. Don't wait for a crisis. 9. **Vet vendors** thoroughly. Monitor third-party compliance closely. 10. **Document controls** and procedures clearly. Don't let knowledge walk out the door. 11. Think **long-term** when designing governance and compliance programs. Build to last. 12. **Balance governance and controls** appropriately for company culture and risk appetite. --- [A CFO’s guide to economic resilience & financial resilienceWith the right financial resilience strategies, mindset shifts, and execution tactics, developing true economic resilience is possible. And that’s exactly what we’re diving into with this guide.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/ship-1366926_1280.jpg)](https://www.financealliance.io/steering-through-storms-a-cfos-guide-to-economic-resilience/) --- ## **Measuring governance & compliance program effectiveness** Strong governance and compliance programs require diligent oversight and measurement to succeed. CFOs play a pivotal role in monitoring program effectiveness and identifying areas for improvement. Here are some ways CFOs can measure the effectiveness of governance and compliance programs: **Risk metrics** \- Track identified [risks and mitigation strategies](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) over time. If you see a reduction, it demonstrates good risk management. **Cost of governance/compliance** \- Measure legal, audit, and program costs over time. Then, weigh these costs against program maturity and company growth. **Industry benchmarks** \- Compare audit deficiencies, violation rates, liaison relationships against peers. **Stakeholder surveys** \- Survey employees on compliance culture or investors on transparency. Positive trends demonstrate effectiveness. **Board reporting** \- Robust, timely reports to the board enable oversight. Feedback indicates their level of confidence. **Training completion rates** \- High completion rates for governance/compliance training shows engagement. **Violations metrics** \- Track incidents of fraud, data breaches, policy violations etc. **Self-assessments** \- Regular self-assessments on meeting compliance requirements or following governance procedures will highlight improvement areas. **Audit results** \- Internal and external audits will identify control gaps or noncompliance that need to be addressed. --- ## **What is compliance in financial management?** Compliance in financial management refers to the adherence to laws, regulations, standards, and ethical practices related to financial operations and reporting. This encompasses a range of activities, such as: - Accurate financial reporting - Tax compliance - Adherence to accounting standards such as GAAP (Generally Accepted Accounting Principles) or IFRS (International Financial Reporting Standards) - Implementing effective internal controls and risk management practices. Getting finance and compliance right is critical for maintaining the trust of investors, regulators, and other stakeholders, and for protecting your company from financial and reputational damage. --- ### FAQs: CFOs, finance and compliance How can CFOs stay updated on regulatory changes affecting their industry? CFOs can stay informed by subscribing to updates from regulatory bodies, joining industry associations, participating in professional networks, and utilizing regulatory advisory services. How do CFOs measure the impact of their company’s governance and compliance programs? Effectiveness can be measured using KPIs such as audit outcomes, incident reports, resolution times for compliance issues, and employee compliance awareness levels. How can CFOs manage cyber risk in their organizations? CFOs can manage cyber risk by investing in cybersecurity technologies, conducting regular risk assessments, developing a comprehensive cyber risk management plan, and ensuring continuous monitoring and incident response readiness. What is the compliance responsibility of the CFO? The compliance responsibility of the CFO involves ensuring that the organization adheres to all applicable financial regulations and laws, both domestically and internationally. This includes overseeing the preparation of accurate financial statements, ensuring proper internal controls are in place, managing financial risks, and maintaining the integrity of financial reporting. Can a CFO also be a compliance officer? Yes, a CFO can also serve as a compliance officer, especially in smaller organizations where roles are often combined due to resource constraints. However, this dual role requires careful management to avoid conflicts of interest and ensure that compliance responsibilities are given sufficient attention alongside the financial duties. In larger organizations, it's more common to have a separate Chief Compliance Officer (CCO) who works closely with the CFO. What is the role of the CFO in governance? The role of the CFO in governance extends beyond financial management to include a broader responsibility for ensuring the organization's overall governance framework is effective and aligned with its strategic goals. This involves overseeing financial reporting and disclosure, ensuring transparency, managing risks, and fostering ethical business practices. What is an example of compliance in finance? Compliance in finance refers to adhering to laws, regulations, standards, and ethical practices that govern financial operations and reporting. An example of compliance in finance is following the Sarbanes-Oxley Act (SOX) requirements for publicly traded companies in the United States. SOX mandates strict financial reporting and internal control procedures to protect investors from fraudulent financial practices. For instance, a company must maintain accurate financial records, establish internal controls to prevent and detect fraud, and undergo annual audits by independent auditors to verify compliance. This ensures transparency, accuracy, and reliability in financial reporting, safeguarding the interests of investors and the integrity of the financial markets. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### How to use Gemini AI with Google Sheets (Gemini Advanced AI for finance) URL: https://www.financealliance.io/how-to-use-gemini-ai-with-google-sheets/ Last updated: 2025-11-04T10:17:30.000Z Is the finance industry on the brink of a technological revolution? Google's latest breakthrough in artificial intelligence, [Gemini](https://gemini.google.com/), has many finance pros anticipating its transformative potential in data analysis and decision-making. Set to eclipse the capabilities of its predecessor, [BARD](https://www.financealliance.io/google-bard-with-google-sheets-excel/), Gemini Advanced AI can perform highly sophisticated reasoning tasks for different modalities. We’re talking text, image, audio, video, and even code. But is it worth the hype? That’s what we aim to find out in this article, where we dive into the revolutionary power of Gemini and how it can help you reach transformative heights in financial strategy, operational efficiency, and market insight. ## **What is Gemini Advanced AI?** Gemini is replacing [Google’s Bard](https://www.financealliance.io/google-bard-with-google-sheets-excel/) as the “*preferred chatbot compared to leading alternatives*” (according to [Google](https://blog.google/products/gemini/bard-gemini-advanced-app/)). **Gemini Advanced** is powered by Google’s cutting-edge **Ultra 1.0 model**, which elevates the standard for performing intricate tasks such as coding, logical analysis, understanding complex instructions, and fostering creativity in collaborative projects. This enhanced version of large language models (LLMs) not only supports extended, in-depth conversations but also exhibits an improved grasp of context from your earlier prompts. Here are a few ways Gemini Advanced stands out: ### **Personalized learning assistant** Imagine having a tutor that crafts custom learning materials, and quizzes, and engages in dynamic discussions, all adapted to the way you learn best. That's what you'll reportedly get when you use Google's Gemini. ### **Advanced coding companion** Whether you're brainstorming coding solutions or assessing various programming strategies, Gemini Advanced acts as an invaluable partner in navigating complex coding challenges. ### **A creative catalyst** For users looking to bring their visions to life ([financial charts and graphs](https://www.financealliance.io/financial-charts-and-graphs/) spring to mind), Gemini Advanced is a powerhouse, generating innovative content and deciphering the latest trends. **Note:* Currently accessible in over 150 countries and territories in English, plans are underway to extend Gemini Advanced to additional languages.* --- [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/10/CFO_Summit_London_NOV24_Email_Banner_-4.png)](https://cfoevents.financealliance.io/location/cfolondon) --- ## **Gemini is the new Bard** ## **State-of-the-art architecture** Built upon groundbreaking research in Transformer and Mixture of Experts (MoE) models, Gemini Advanced diverges from traditional AI systems by employing a network of smaller, specialized "expert" neural networks. This unique structure allows the AI to activate only the most relevant pathways for the task at hand, significantly enhancing its operational efficiency and precision. For those in the finance sector, this means access to an [AI tool](https://www.financealliance.io/15-best-fp-a-tools-and-software/) capable of rapidly processing complex financial data and delivering insights with unparalleled speed. The MoE architecture's ability to selectively engage expert pathways translates into faster, more accurate analyses - crucial for making informed decisions in finance. --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ## **Using Gemini Advanced for finance** Google's Gemini AI, with its state-of-the-art architecture and advanced capabilities, is poised to revolutionize various aspects of the financial industry. From automating financial report writing to conducting variance analysis and integrating with tools like Google Sheets, Gemini AI offers a suite of applications designed to streamline operations and provide deeper insights. Let's explore how finance professionals can leverage Gemini AI to stay ahead of the curve: ### **Financial report writing** Gemini AI, with its advanced natural language processing abilities, can automate the [creation of financial reports](https://www.financealliance.io/flexible-budget-performance-report/). By feeding the AI system raw financial data, you can receive well-structured, coherent reports that highlight [key financial metrics](https://www.financealliance.io/infographic-financial-performance-metrics/), trends, and anomalies. This not only saves valuable time but also reduces the risk of human error, ensuring that [stakeholders](https://www.financealliance.io/stakeholder-communication-plan/) have access to reliable and accurate information for decision-making. 💡 ***Tip:** *Short on time? Ask Gemini Advanced to summarise the most important insights of your financial data and get results almost instantly.* ### **Generate Python code** > *“Our first version of Gemini can understand, explain, and generate high-quality code in the world’s most popular programming languages, like Python, Java, C++, and Go.* > *"Its ability to work across languages and reason about complex information makes it one of the leading foundation models for coding in the world.” –* [*Sundar Pichai, CEO of Google, and Demis Hassabis, CEO and Co-Founder, Google DeepMind.*](https://blog.google/technology/ai/google-gemini-ai/#sundar-note) Gemini AI can assist by generating [Python](https://www.financealliance.io/how-to-use-python-in-excel/) code snippets tailored for Google Colab, allowing you to easily perform complex data analyses, model financial scenarios, or visualize data trends. This capability not only democratizes access to advanced data science techniques but also significantly speeds up the analytical process. --- [How to build custom copilots with Microsoft Copilot StudioMicrosoft’s latest technological marvel, Copilot Studio, announced at Ignite 2023, marks a revolutionary step for finance professionals.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/Copilot-image.webp)](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) --- ### **Efficient contextual understanding** Gemini AI's advanced contextual understanding capabilities are particularly beneficial for interpreting financial news, market trends, and economic reports. By analyzing such content, AI can provide finance professionals with summarized insights, sentiment analysis, and potential impacts on markets or specific financial instruments. This contextual awareness enables professionals to make informed decisions quickly, leveraging the AI's ability to sift through and interpret vast amounts of information. ## **How to use Gemini AI with Google Sheets** Many finance professionals rely on Google Sheets for [data analysis](https://www.financealliance.io/cost-benefit-analysis/) and reporting. So, you’ll be glad to know that you can use [Gemini](https://workspace.google.com/solutions/ai/) in Google Sheets. Gemini is also available in Google Docs, Gmail, Slides, and Meet. You can use [Gemini in Sheets](https://support.google.com/docs/answer/14218565?hl=en) to help you: - Create tables - Create formulas - Summarize data and files (from Drive and Gmail) You can employ Gemini AI to automate data entry, generate dynamic financial models, and extract insights directly within their spreadsheets. This integration simplifies complex analyses and enhances collaboration among teams by providing a centralized, intelligent platform for financial management. Instructions for using Gemini in the **side panel** of your Google Sheet: **1\.** With your spreadsheet opened, click ‘**Ask Gemini**' at the top right corner. **2.** Select from **suggested prompts** or **create your own**. **3\.** From the generated content, you’ll have more options to either **view more**, **view less**, generate new content by clicking **retry**, or add the supplied content to your spreadsheet (click **insert**). To make the side panel bigger, click ****Expand**. To go back to its original size, click ****Collapse**. --- [How to use GPT-4o in finance (and data analysis)You can now upload Excel, CSV, and other spreadsheet files directly to GPT-4o. No more copying and pasting data into ChatGPT manually, which makes the entire process of analyzing complex data sheets a lot easier and less time-consuming.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/GPT-4o-finance-2.jpg)](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/) --- ## FAQs: Google Gemini AI ### **What is Gemini AI?** Gemini AI is a large language model (LLM) that is described as Google’s “"largest and most capable AI model" yet. ### **What is Gemini Advanced?** The Gemini Advanced version, powered by Google's 1.0 Ultra model, significantly excels in executing highly intricate tasks, including coding, logical reasoning, comprehending detailed instructions, and engaging in creative collaboration efforts. ### **Is Gemini better than ChatGPT?** The comparison between Gemini and[ChatGPT](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/) depends on specific use cases and criteria such as performance, capabilities, and application areas. Gemini is described as Google's most capable AI model, highlighting its advanced capabilities in complex tasks. However, without direct benchmarks or specific performance metrics comparing the two, it's challenging to definitively say one is better than the other across all scenarios. ### **How do I use Gemini Google AI?** To use Google’s Gemini AI, you’ll first need to sign in with your Google Account. Then, you’ll be able to use the Gemini Google AI. However, you might need to pay for a subscription to use the latest models of Gemini. ### **Can Google Gemini create images?** When it was first released, Gemini could generate images. However, Google has paused the AI’s ability to generate images of people until they can improve the accuracy of its responses due to public backlash and inaccurate or even offensive images being generated. ### What is Gemini for Google workspace? Gemini for Google Workspace serves as a dynamic collaborative ally, functioning as a mentor, brainstorming companion, fountain of inspiration, and enhancer of productivity. Additionally, it guarantees that both individual users and organizations maintain authority over their data. --- ### Further reading: Learn about Microsoft 365 Copilot and Excel with this article: [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) Read all about Microsoft Fabric and how you can use it with Data Factory, Synapse Real-Time Analytics, and more here: [How to use Microsoft Fabric for data analyticsWith Microsoft Fabric, you can bridge the gap between data and intelligence and integrate all your data seamlessly. These tools have opened up new possibilities, setting the stage for a new era in finance AI.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Microsoft-fabric-1.jpg)](https://www.financealliance.io/microsoft-fabric-for-data-analytics/) Learn how to use ChatGPT with Excel here: [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) And finally, read all about how to use Copilot with Power BI here: [How to use Copilot in Power BIIn this article, we explore how you can leverage the power of Copilot in Power BI to help streamline your everyday processes within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/copilot-in-power-bi-2.jpg)](https://www.financealliance.io/copilot-in-power-bi/) --- ### The evolving role of FP&A in ESG planning and reporting URL: https://www.financealliance.io/the-evolving-role-of-fp-a-in-esg-planning-and-reporting/ Last updated: 2026-03-05T16:53:55.000Z In recent years, Environmental, Social, and Governance (ESG) factors have emerged as critical drivers of business success. ESG encompasses various non-financial indicators that measure a company's impact on the environment, society, and corporate governance. As organizations increasingly recognize the significance of ESG in shaping their reputation, risk management, and long-term sustainability, the role of financial planning and analysis (FP&A) professionals has evolved. This blog will explore how FP&A plays a pivotal role in ESG planning and reporting. ## Understanding ESG reporting ESG reporting involves disclosing a company's performance in areas such as carbon emissions, workplace diversity, ethical governance, and community engagement. This information is crucial for stakeholders, including investors, customers, regulators, and employees to assess a company's commitment to sustainable and responsible practices. ## Why FP&A matters in ESG reporting ### Data collection and analysis FP&A teams are adept at collecting, analyzing, and interpreting financial data. These skills are equally valuable in collecting and analyzing non-financial ESG data. FP&A professionals can identify relevant ESG metrics, gather data from various sources, and ensure accuracy and completeness. ### Integration with financial metrics ESG performance is increasingly intertwined with financial performance. FP&A teams can bridge the gap by integrating ESG metrics into financial reporting and forecasting models. This provides a comprehensive view of a company's overall health and performance. ### Risk assessment ESG issues pose significant financial risks. FP&A professionals can evaluate the financial implications of ESG-related risks, such as regulatory fines, litigation, or reputational damage. They can assist in quantifying these risks and devising strategies to mitigate them. --- [ESG metrics: How to drive sustainable business successIn this article, we demystify ESG metrics and provide actionable strategies to help you use them to drive sustainable business success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/05/ESG-METRICS.jpg)](https://www.financealliance.io/esg-metrics/) --- ### Cost-benefit analysis FP&A teams excel at cost-benefit analysis. Regarding ESG initiatives, they can evaluate the financial impact of sustainability projects, energy efficiency measures, or diversity and inclusion programs. This helps companies make informed decisions about resource allocation. ### Scenario planning FP&A professionals are skilled in scenario planning and sensitivity analysis. They can model different ESG scenarios, such as the cost of carbon pricing or the potential benefits of renewable energy investments. This enables companies to prepare for various ESG-related outcomes. ### Performance tracking ESG goals and targets require rigorous tracking and reporting, similar to financial KPIs. FP&A teams can establish ESG performance metrics, monitor progress, and provide regular updates to stakeholders, enhancing transparency. ### Investor relations Investors are increasingly scrutinizing ESG performance when making investment decisions. FP&A professionals can collaborate with investor relations teams to ensure ESG disclosures align with investor expectations and regulatory requirements. --- [7 key benefits of ESG investing | Finance AllianceIn this article, we’ll discuss the key benefits of ESG investing and why ESG investing has become such a game-changer in modern finance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/06/benefits-of-esg-investing-2.jpg)](https://www.financealliance.io/7-benefits-of-esg-investing/) --- ## Steps FP&A professionals can take in ESG planning and reporting ### Identify relevant ESG metrics FP&A teams should work closely with sustainability and ESG experts to identify the most relevant ESG metrics for their industry and business. These could include carbon emissions, diversity ratios, water usage, etc. ### Data collection and validation FP&A professionals should establish robust data collection processes for ESG data. This may involve collaborating with different departments to gather data, ensure its accuracy, and validate it through third-party audits or certifications. ### Integration with financial reporting ESG data should be integrated into financial reports and disclosures. FP&A teams can create dashboards that comprehensively present financial and ESG performance metrics. ### Risk assessment FP&A professionals should assess the financial risks associated with ESG issues. This includes evaluating potential regulatory changes, reputational risks, and supply chain disruptions related to sustainability factors. ### Financial modeling FP&A teams can build financial models that incorporate ESG variables. For example, they can model the impact of different carbon pricing scenarios on operating costs and profitability. ### Scenario analysis Using scenario planning techniques, FP&A professionals can help companies prepare for ESG-related uncertainties. They can model various scenarios, such as the effects of extreme weather events or changes in consumer preferences. ### Communication and transparency FP&A is crucial in communicating ESG performance to internal and external stakeholders. They should ensure that ESG disclosures are clear, accurate, and aligned with reporting standards and frameworks such as the Global Reporting Initiative (GRI) or the Task Force on Climate-related Financial Disclosures (TCFD). ### Continuous improvement ESG planning and reporting should be an iterative process. FP&A teams can identify improvement areas, set ESG performance targets, and measure progress over time. --- [How organizations fuel innovation through ESG and diversityIn this article, I’ll be sharing my experience with ESG and sustainability practices.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceCarolina Veira![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/nicholas-doherty-pONBhDyOFoM-unsplash.jpg)](https://www.financealliance.io/how-great-organizations-fuel-innovation-through-esg-and-diversity/) --- ## Conclusion The role of FP&A in ESG planning and reporting is becoming increasingly vital in today's business landscape. By leveraging their data analysis, financial modeling, and risk assessment expertise, FP&A professionals can help organizations navigate the complex ESG landscape, make informed decisions, and demonstrate their commitment to sustainability and responsible business practices. As ESG considerations continue to shape the business world, FP&A's contribution is indispensable for achieving financial success and a positive societal impact. --- ### Thinking about attending the FP&A Summit? Hear from our attendees! 🔊 URL: https://www.financealliance.io/thinking-about-attending-the-fp-a-summit-hear-from-our-attendees/ Last updated: 2024-02-20T10:26:07.000Z We recently wrapped up our [FP&A Summit](https://events.financealliance.io/?%5Fgl=1%2A19vgtng%2A%5Fga%2ANTY3MTk0Njc1LjE3MDgwOTA2Nzk.%2A%5Fga%5F2NXFSBEP4N%2AMTcwODQyNDExNS4yOC4wLjE3MDg0MjQxMTUuMC4wLjA.) in London, where we gathered some of the brightest minds in finance and FP&A and talked about some of the hottest topics in the industry today. From business partnering hacks to the cool ways AI can transform finance, there was *a lot* to uncover at the event. From seasoned pros to eager newcomers in the finance world, the summit was a melting pot of ideas, innovation, and inspiration. But don’t take our word for it! We caught up with some of our special guests to share their experience and what they thought about the event. So, stay tuned as we bring you the highlights and personal stories from some of those who made the event a smashing success. 👇 ## **What finance pros loved about FP&A Summit London** Before we dive into the testimonials, let's set the scene on what made our FP&A Summit in London a hit among finance professionals. It wasn't just the cutting-edge topics or the stunning backdrop of London that stole the show. It was the vibrant energy, the shared passion for finance and planning, and the genuine connections made that truly set this event apart. Attendees were *buzzing* about the deep-dive sessions on [business partnering](https://www.financealliance.io/finance-business-partnering-playbook-2/), where real-world examples brought to life the art of influencing and collaborating across departments. The discussions on applying AI in finance were a particular highlight, with finance pros getting a first-hand look at how technology is reshaping forecasting, reporting, and decision-making in new and exciting ways. But it wasn't all tech and tactics. The summit also provided invaluable [budgeting](https://www.financealliance.io/flexible-budget-performance-report/) insights, from innovative approaches to resource allocation to strategies for navigating economic uncertainty. These conversations weren't just theoretical; they were grounded in practical advice that attendees could take back to their teams and implement immediately. Alright, that’s enough from us! Let's hear directly from some of the attendees about their experiences and takeaways from the summit. [**Eric Adam**](https://www.linkedin.com/in/eadam/)**, Director of FP&A, Insulet Corporation:** > *“I think it was an amazing day, what I really enjoyed was having so many diverse backgrounds with extremely skilled profiles. I think you did an amazing job bringing all those people together.* > *“I really enjoyed the format of the session as well. I think there was a right balance between having presentations and having those sessions where people could share and get to know each other. So, I think it was really successful.”* [**Thomas Auster**](https://www.linkedin.com/in/tom-a-83b6ab30/)**, Head of Finance, GuestReady Ltd:** > *“It’s been really great. We're right in the middle of budgeting right now. So, it's good to be re-energized and get a lot of insights from some key individuals and learn a lot more about FP&A during this busy time.”* --- [AI in Finance eBook | Free DownloadWelcome to the AI in Finance eBook, your trusted guide to merging AI’s vast potential with everyday finance operations such as forecasting, budgeting, analysis, and more.👇![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/FA_AI_in_Finance_Playbook_Blog.png)](https://www.financealliance.io/ai-in-finance-ebook-download/) --- ## **What were the key takeaways from FP&A Summit London?** After the dust settled on an incredible FP&A Summit in London, we were eager to catch up with our attendees to find out what resonated most with them. The event was packed with insights, innovations, and inspiring conversations, and we wanted to know what stood out, what sparked ideas, and what they were taking back to their desks and teams. Here's what they had to say.👇 [**Jasmine Cheng**](https://www.linkedin.com/in/praisejasmine/)**, Finance Manager, GuestReady Ltd:** > *“I learned a lot! I especially enjoyed the tips on how to become an effective business partner and collaborating with the other teams.* > *"It’s really nice to know that I'm not the only person who struggles to collaborate with people from different teams. I got some practical tips shared by many experts here.”* [**Eric Adam**](https://www.linkedin.com/in/eadam/)**, Director of FP&A, Insulet Corporation:** > *“I think there are loads of important takeaways from this day about business partnering. What I personally took away is that there are different ways to adapt. One is about your personal attitudes, how you adapt yourself, your communication and your style to better work with the business.* > *“The second one, I will say really is about how you improve what you're building in terms of visuals and using different types of content in order to better serve the business. And I will say there was an important aspect as well about technology, the topic of AI of course, but tools and how these tools can be leveraged to drive better efficiency and business partnering.”* --- ### **Want to attend our next FP&A Summit?** We’re coming to San Jose, Boston and London in 2024! 🌎 Get all the info and book your tickets to the finance event of the year [right here](https://events.financealliance.io/?%5Fgl=1%2Abmf3bk%2A%5Fga%2AMjU3ODQyODEzLjE3MDQxOTM1NTM.%2A%5Fga%5F2NXFSBEP4N%2AMTcwODQyMDg3NS4xMDQuMS4xNzA4NDIyNzk3LjAuMC4w). [Find out more](https://events.financealliance.io/?%5Fgl=1%2Abmf3bk%2A%5Fga%2AMjU3ODQyODEzLjE3MDQxOTM1NTM.%2A%5Fga%5F2NXFSBEP4N%2AMTcwODQyMDg3NS4xMDQuMS4xNzA4NDIyNzk3LjAuMC4w) --- ### **Can’t wait? Access footage from our events.** Access our event footage with a [Finance Alliance Pro Membership plan](https://www.financealliance.io/pro-membership/), which offers a library of resources including full access to previous in-person and virtual event footage OnDemand, entirely accessible from the comfort of your home! [Sign Up](https://www.financealliance.io/signup/) ### How to create a flexible budget performance report URL: https://www.financealliance.io/flexible-budget-performance-report/ Last updated: 2025-11-04T10:23:08.000Z We’re all familiar with the traditional static budget – a fixed plan based on predetermined assumptions. But what if you need a budget that can adapt to your actual business activity levels? One that gives you a more realistic view of your financial performance? That’s where a flexible budget performance report steps in. Unlike its stiff counterpart, a flexible budget performance report is designed to adapt and shift as the levels of activity within your business change. That kind of adaptability is *huge*. It means when you're analyzing your business and making decisions, you can be sure you're working with budget numbers that match your current reality, not just outdated assumptions. Stick around as we dive deeper into why a flexible budget performance report is the way to go and how you can create one for your business. #### Table of contents - [What is a flexible budget performance report?](https://www.financealliance.io/p/ac042cbb-e14b-48f2-b17d-2b9eed35bb81/#what-is-a-flexible-budget-performance-report) - [Benefits of a flexible budget performance report ](https://www.financealliance.io/p/ac042cbb-e14b-48f2-b17d-2b9eed35bb81/#benefits-of-a-flexible-budget-performance-report) - [How to prepare a flexible budget performance report](https://www.financealliance.io/p/ac042cbb-e14b-48f2-b17d-2b9eed35bb81/#how-to-prepare-a-flexible-budget-performance-report) - [Bonus tips](https://www.financealliance.io/p/ac042cbb-e14b-48f2-b17d-2b9eed35bb81/#more-tips-for-success) - [FAQs](https://www.financealliance.io/p/ac042cbb-e14b-48f2-b17d-2b9eed35bb81/#faq-corner-flexible-budget-performance) ## **What is a flexible budget performance report?** A flexible budget performance report compares actual performance data with budgeted figures that have been adjusted (flexed) for the actual level of output or activity. But a flexible budget report goes a step beyond just flexing the budget. It also compares those adjusted, flexed budget figures to your *actual* real-world results, analyzing the differences line by line. We call those differences the **variances**. If actual revenue or costs were better than the flexed budget predicted, that's a ****favorable variance**. But if actual results were worse than the flexed budget, it's an ****unfavorable variance**. With this variance analysis, the flexible [budget report](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/) gives you powerful insights. It pinpoints areas where you were more efficient or less efficient than expected, so you can investigate the root causes. So that's the essence of a flexible budget report - a budget that bends to reality, comparing the **flexed numbers** to **actual results**, and providing rich analysis to help you run a smarter, more profitable business. --- [6 zero-based budgeting myths debunkedA zero-based budget (ZBB) is a budgeting method where you allocate every dollar earned to a specific category or expense. You start with a blank slate - zero - each time you budget, rather than tweaking your past budget.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/zero-based-budgeting-2.jpg)](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/) --- ## **Benefits of a flexible budget performance report** The flexible budget performance report offers several benefits that make it a valuable tool for businesses seeking to manage their operations and finances more effectively. Let’s walk through some of them.👇🏼 ### ✅ **Better performance evaluation** Instead of just looking at actual results versus a static, outdated budget, you're comparing to flexed numbers that match reality. This pinpoints exactly where you're excelling and where there's room for improvement. ### ✅ **Improved cost control** By analyzing all the variances - both good and bad - you can zero in on areas where costs aren't aligning to plan. With that level of insight, you have a clear roadmap to start [controlling expenses](https://www.financealliance.io/3-key-pain-points-in-budgeting/) and driving greater efficiency. ### ✅ **Increased adaptability** Flexible budgets let you course-correct on the fly as operating conditions change. So you're not stuck with a rigid budget disconnected from reality. Your [planning and forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) can bend and flex to match the dynamic markets and conditions you face. ### ✅ **Smarter decision making** When you deeply understand the reasons driving variances, you have the tools to strategize better. Pricing, production levels, resource allocation - you name it, your decisions will be guided by real, insightful analysis. ![](https://media.tenor.com/QufqbwXItD4AAAAC/theodoros.gif) ### ✅ **More accountability** When department heads and managers are evaluated based on performance against a flexible budget, it creates a fairer and more realistic basis for accountability. This can motivate employees to achieve budgetary goals that accurately reflect their level of activity. ### ✅ **Effective resource allocation** By identifying which areas of the business are performing efficiently and which aren’t, flexible budget performance reports guide the [allocation of resources](https://www.financealliance.io/tips-to-allocate-budget-across-departments/). In other words, you can pump more investment into the areas firing on all cylinders, while doubling down on addressing inefficiencies elsewhere. ### ✅ **Strategic planning support** The insights from variances and activity shifts inform your [big-picture strategies](https://www.financealliance.io/10-big-picture-financial-planning-steps/) and goal setting to sync up with real-world conditions. ### ✅ **Improved financial forecasting** Regularly analyzing variances and understanding their causes can improve the accuracy of future budgets and forecasts. No more flying blind - you'll get better and better at predicting financial performance. --- [13 effective tips to allocate budget across departmentsBudget allocation is the process of designating specific amounts of money to each department within a company. This article highlights 13 tips for successful budget allocation across departments…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/budget-allocation-1.jpg)](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) --- ## **How to prepare a flexible budget performance report** Alright, now let's dive into the nitty-gritty of creating a flexible budget performance report for your business. Here are the key steps: ### **1\. Understand cost behavior** The first step is getting to know the behaviors of your different costs. You need to categorize them into three buckets: - Fixed costs that stay the same no matter what. - Variable costs that move up and down directly with your activity levels - Semi-variable costs that have both fixed and variable components. Getting these classifications right is crucial because it allows you to accurately flex and adjust your budget as activity swings around. ### **2\. Set activity levels** Next up, pinpoint the main [drivers that affect cost and revenue](https://www.financealliance.io/cash-flow-drivers-in-a-business/) changes in your business. It could be units produced, units sold, hours worked - whatever the primary lever is. Then, set a realistic range of expected activity levels to provide a flexible framework for your budget. ### **3\. Develop the flexible budget** Now for the fun part - actually building out the flexible budget! Take each activity level you identified and calculate how variable and semi-variable costs would adjust at that level. Fixed costs just stay static across the board. This gives you a menu of budgets reflecting different [potential real-world scenarios](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/). A powerful baseline to reference as actual results start rolling in. ### **4\. Collect actual performance data** Once the reporting period is over, pull together all the real-world data on revenues, expenses, and that key activity driver you've been tracking, like units produced. This is the factual evidence you'll compare to those hypothetical budgets. ### **5\. Perform variance analysis** With actual results in hand, you can start calculating all the differences, or [variances](https://www.financealliance.io/budget-vs-actual-variance-analysis/), between what actually happened and what the budget anticipated for the real level of activity achieved. 💡 Tag each variance as favorable or unfavorable based on whether performance was better or worse than budgeted. ### **6\. Analyze and interpret variances** But the numbers alone aren't enough - you need to dig deeper to truly understand the "whys" behind each variance. Was it related to efficiencies, market conditions, pricing, or something else? Get to the root causes, because those insights are what will drive meaningful improvements. ### **7\. Report and communicate findings** Compile your findings into a comprehensive report that includes an overview of actual performance, budgeted figures adjusted for actual activity levels, variances, and an analysis of those variances. Communicating with clarity is key for this report to drive better decisions. ### **8\. Recommend actions** Finally, based on your rich variance analysis, make specific recommendations for improvement. This could mean adjusting cost structures, reallocating resources, or revising strategies - whatever it takes to capitalize on opportunities and correct areas of concern. Actionable intel is the entire point! So there you have it - a detailed roadmap for constructing a flexible budget report that moves and breathes with the realities of your business. --- [Rolling forecast best practices | Finance AllianceA rolling forecast formula is a straightforward concept. For every period that passes, a new one is added to the end of the forecast…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/08/rolling-forecast-best-practices-2.jpg)](https://www.financealliance.io/rolling-forecast-best-practices/) --- ## **More tips for success:** We've covered a lot of ground walking through the nuts and bolts of preparing a flexible [budget performance report](https://uk.indeed.com/career-advice/career-development/flexible-budget). But before we wrap up, let’s cover a few bonus tips that’ll really help ensure your success: First off, don't try to build these complex activity-based budgets manually - utilize [financial software](https://www.financealliance.io/10-best-financial-modeling-tools/) or robust spreadsheets to make it much easier. The right tools will let you create and adjust budgets for all those different potential activity levels. Secondly, remember that building an accurate flexible budget takes insights from across the organization. So, engage early and often with department heads and operational managers. Pick their brains on cost drivers, areas prone to variance, and any other intel that can refine your assumptions. It's also critical to regularly review and update those assumptions over time as the business landscape evolves. Don't let projections and cost behavior categorizations get stale - keep them fresh and relevant. And finally, make sure to foster a culture of continuous improvement fueled by the insights from these reports. Use each round of variance analysis to not only course-correct in the short-term, but to refine and optimize your budgeting processes, operational strategies, and everything. View it as a virtuous cycle of constant learning and enhancement. --- ## FAQ corner: Flexible budget performance ### **Q. What is a flexible budget performance report?** A flexible budget performance report compares actual results with budgeted amounts adjusted for the actual level of output or revenue. It adjusts for changes in the volume of activity, making it a more useful tool for analyzing and controlling [operational performance](https://www.financealliance.io/operational-finance/). ### **Q. What is the main purpose of a flexible budget?** The main purpose of a flexible budget is to provide a more accurate benchmark for comparing actual performance by adjusting budgeted figures to reflect the actual level of output or activity. It aids in understanding the effects of variations in operational activity levels on financial performance. ### **Q. What does a flexible budget performance report indicate?** A flexible budget performance report indicates how well the company managed its costs and operations in response to actual levels of activity. It highlights variances between actual and budgeted amounts, identifying areas of efficiency and inefficiency. ### **Q. How do you prepare a flexible budget report?** To [prepare a flexible budget report](https://www.financealliance.io/p/ac042cbb-e14b-48f2-b17d-2b9eed35bb81/#how-to-prepare-a-flexible-budget-performance-report), start by identifying variable costs per unit of activity and fixed costs. Adjust the budgeted amounts based on the actual activity levels. Finally, compare these adjusted budgeted figures to actual figures to analyze variances. ### **Q. How do you write a budget performance report?** Writing a budget performance report involves summarizing the financial performance of a period, comparing actual figures against budgeted figures, explaining variances, and providing insights into the reasons behind those variances. It often includes recommendations for future action. ### **Q. How are flexible budgets used to analyze performance?** Flexible budgets are used to analyze performance by providing a more relevant comparison of actual expenses and revenues to budgeted figures that have been adjusted for the actual level of activity. This analysis helps in understanding how changes in activity levels affect financial outcomes. ### **Q. What is budget performance analysis?** Budget performance analysis is the process of comparing actual financial results with budgeted expectations. It involves identifying variances, understanding the reasons behind these variances, and assessing the organization's financial performance and efficiency. ### **Q. How do you write a budget analysis?** Writing a budget analysis involves reviewing budgeted versus actual financial figures, identifying and explaining variances, and evaluating the reasons for these differences. It should conclude with insights and recommendations for future budgeting and operational improvements. ### **Q. Why is a budget performance report important?** A budget performance report is important because it provides critical insights into how effectively and efficiently resources are being used. It helps identify areas where the organization is over or underperforming against its plans, guiding strategic decisions and financial management. --- ## Take our Budgeting & Forecasting: Certified course Take your [budgeting and forecasting](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) skills to the next level by learning the practical techniques used today at leading companies from an experienced FP&A leader – Christian Wattig. Christian is an accomplished FP&A expert with over a decade of leadership experience in multinational corporations and fast-growing tech start-ups. With Christian Wattig as your coach, you’ll learn how to navigate the five phases of annual budgeting: Pre Kick-Off, Joint Planning, Consolidation, Iteration, and Final Alignment. You’ll also learn to create accurate forecasts that empower leaders to make better decisions. [Enrol today](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### Beyond FP&A: Exit opportunities, business partnering, and cross-functional working URL: https://www.financealliance.io/beyond-fp-a-exit-opportunities-business-partnering-and-cross-functional-working/ Last updated: 2025-04-07T10:01:06.000Z *This panel discussion between Premal Parekh (Former CFO/Finance Director at London Stock Exchange Group), Magdalena Sailer (Former Finance Director, VICE Media), and Chris Ortega (CEO, Fresh FP&A) took place at the FP&A Summit in June 2023.* **Premal Parekh** This session is focused on what you can do beyond [FP&A](https://www.financealliance.io/fp-a-for-startups/), whether that's been your role or the value that you can add to a company. We’ll also be talking about [exit opportunities](https://www.financealliance.io/fp-a-exit-opportunities/), business partnering, cross-functional working, or moving into a business away from finance. There are a whole multitude of options. **Chris Ortega** I'm the CEO of Fresh FP&A. At Fresh FP&A, we provide fractional CFO and advisory services to high-growth businesses, which include software, technology, retail, e-commerce, pharma, and renewable companies. **Magdalena Sailer** I've been working as a finance professional for about 15 years in various functions with very different teams, always as a finance business partner, and most recently as a finance director for VICE Media. Wherever in the world you're working, be aware and be careful of the different titles in the wider finance profession. Different career paths can have a completely different meaning in day-to-day jobs. Also, underlying education as well as work experience can vary tremendously. I usually split finance into [FP&A and accounting](https://www.financealliance.io/fp-a-vs-accounting-key-differences-every-finance-pro-should-know/). I’ve always worked in fast-paced, agile organizations with very little hierarchies, and every finance position has had the chance to work as a business partner and very close to sales teams, account, or project management teams. This isn’t the reality for every organization and industry. - [Defining the evolving roles in finance](https://www.financealliance.io/p/260a90cc-02f3-49ae-9969-1ed774fd0f95/#defining-the-evolving-roles-in-finance) - [Career opportunities beyond FP&A](https://www.financealliance.io/p/260a90cc-02f3-49ae-9969-1ed774fd0f95/#career-opportunities-beyond-fpa) - [The power of communication, collaboration, and connection](https://www.financealliance.io/p/260a90cc-02f3-49ae-9969-1ed774fd0f95/#the-power-of-communication-collaboration-and-connection) - [Purpose, impact, and people: Guiding your finance career](https://www.financealliance.io/p/260a90cc-02f3-49ae-9969-1ed774fd0f95/#purpose-impact-and-people-guiding-your-finance-career) - [Embracing new opportunities and learning from failure](https://www.financealliance.io/p/260a90cc-02f3-49ae-9969-1ed774fd0f95/#embracing-new-opportunities-and-learning-from-failure) ## Defining the evolving roles in finance **Premal Parekh** Let’s start off with defining the roles because it's so different across the landscape. It differs by scale, complexity, country, etc. Magdalena, you mentioned three types of roles towards the end of your introduction, What do they mean to you? **Magdalena Sailer** In the organization I'm working for right now, finance is split into the big areas, accounting and FP&A, and then there are subteams like treasury and taxes, and so on. Accounting is a support function for finance; you can't do FP&A without accounting. **Premal Parekh** Chris, what are your thoughts and experiences of the different types of roles and where you've seen those roles develop for individuals? **Chris Ortega** You’ve got to go back to the history of it and how FP&A spawned. Nobody knows the history exactly, but it was probably a business partner who created FP&A, someone outside the finance organization who probably had a great relationship with finance. And they said to that accounting or finance person, “Thank you for the numbers. But what does this mean for the future?” And that accountant probably said, “Yeah, this is outside the month-end close.” And they probably provided a great answer to that person. So that was the inception, where the business spawned that need and appetite for FP&A, and it’s evolved over the years. I named my business Fresh FP&A, but our version of FP&A isn’t what I consider to be the 1.0 version. That 1.0 version was financial planning and analysis. Just the name is very quantitatively heavy. We came in with the planning, the analysis, the data, Excel, the software, etc. Over the last couple of years, that FP&A and that value has gone to financial partnership and advising. I call it the blue ocean of FP&A. Nowadays, the business expects finance to be the planning and analyst person. Technology should be taking a lot of that data aggregation, data mining, and VLOOKUPs, and traditional financial planning and analysis can be very focused on the technology side. Where we need to upskill our mindset, skill set, and value to the business is definitely around financial partnership and advising. To me, that’s been the evolution and history behind the inception of FP&A, and where we're going to provide value in the future. --- [Cost-benefit analysis: 5 steps to turn data into smarter choicesIf you want to learn more about what cost-benefit analysis is and how to do it, keep reading as we dive into five key steps to streamline your financial evaluations and drive smarter decisions. 🧠![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/cost-benefit-analysis.jpg)](https://www.financealliance.io/cost-benefit-analysis/) --- ## Career opportunities beyond FP&A **Premal Parekh** What do you believe are the career paths for professionals beyond the existing FP&A roles that are around today? **Chris Ortega** If there's one takeaway I can provide, it’s this: get outside of finance and go learn the business. Part of what we do at Fresh FP&A is work with CEOs, founders, and business owners all across the world. We have operations in the Americas, APEC, and EMEA, so we’ve got the whole globe covered. And that's one of the most important things finance professionals need to do. Go and learn the go-to-market function, go learn how you serve customers. Get that acumen outside of the finance organization. I always found myself being a salesperson who loved finance. In high-growth SaaS businesses and through leading those finance organizations, HR, sales, and marketing operations were always my greatest business partners. And one of the most important things I learned in getting outside and learning the business was the art of influencing. So if you want to learn the business, go and sit down with your sales, marketing, revenue, and operations people and ask them about problems, opportunities, frustrations, and challenges that they see in their business and how can you help them solve them. Once you start to understand the business, now you've got that seat at the table. You’re no longer just the number police and smacking them across the head when they go over budget, you're actually providing value. One of the biggest things that I've learned in my career is if you're able to take pain from people and transition that to productivity, you're a value-added partner at that point. And a lot of it starts with getting outside of that comfort zone. You get comfortable with your Excel spreadsheet and your financial models, but you need to get connected and find those challenging opportunities outside the finance organization. **Magdalena Sailer** I absolutely agree with that experience. I think the two crucial points when FP&A fails are ignoring accounting, ignoring the rules, or ignoring business reality. If you don't know what's going on, you can't verify your numbers. You don't know if your numbers are right, and you don't know what analytics you should do, or what questions to ask. So it's really important to go out and connect with your colleagues in the other teams. **Premal Parekh** Have a think about what the [exit strategy](https://www.financealliance.io/13-potential-exit-strategies-after-fp-a/) or the growth strategy is of the business you're in. Think about it from right to left, right being the end. If there's a company that’s possibly going to do a trade sale, a PE exit, a P sale, IPO, or growing to help grow their share price, go in and understand what’s driving the key parts of that business, and work backward. Understand from an M&A perspective or an investor relation perspective, read company accounts or listen into analysts' phone calls at quarterly or year-end reporting. Some of the big listed businesses will give you an insight into strategy, initiatives, and an understanding of growth ambitions. That’ll then feed into the value that finance can create across the business. Then it becomes a point where you as a finance individual can decide what your strongest skills are and where you need to develop. That could lead you into different parts of the business and different functions. Through fact-finding and exploration, learn about that business that you're in or you want to be in if you're looking to move out of your current role or company. --- [5 CFO trends 2024 | Finance AllianceThe future is never certain. Yet, as Chief Financial Officers (CFOs), anticipating the future is an essential part of the job. So, what should be on your radar for 2024? 🤔 Below, we explore some of the biggest CFO trends of 2024 that look ready to reshape finance priorities and functions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/cfo-trends-2024.jpg)](https://www.financealliance.io/cfo-trends-2024/) --- ## The power of communication, collaboration, and connection **Premal Parekh** What skills and competencies do you think are highly valued in roles that involve business partnering and working with cross-functional teams? **Chris Ortega** Communication, collaboration, and connection. I call them the three power Cs of finance. The most important thing is translating finance to the business, and that requires communication. [ChatGPT](https://www.financealliance.io/chatgpt-for-excel/) and generative AI aren’t going to be able to take that really disciplined stuff and communicate it effectively to a business partner. A lot of times, finance fails in that because we go talk to the business from a finance perspective. We talk about revenue and why it’s down and contract amortization and the business doesn’t even understand it. They completely shut down. So we’ve got to be great communicators. The second one is collaboration. There’s no way we get anything done and level our mindset, skill set, and value in the business if we don't collaborate. Get out and go connect and collaborate with people. I know virtually it’s hard right now because people are on a hybrid schedule and can’t always find ways to collaborate. Sometimes I pop into sales meetings, marketing meetings, and leadership meetings. It’s about having that way of collaborating with others and coming from a place of not commanding that collaboration, but wanting to be that collaborative partner. The third one is connection. There’s no better organization that can connect the dots in the business than the finance organization. Everything stops with us. We’re able to see the entire story of a business. We can connect the dots to the sales group, marketing group, operations, and HR. As we establish ourselves as that spoke of the wheel in terms of value and driving the business forward through uncertainty and challenges that we're facing, we can build that connection. That’s value. **Magdalena Sailer** People often think that as soon as there’s a focus on FP&A, the accounting skills aren’t at the very top level, and that's a crucial point when you think about why forecasting is failing and why budgeting is failing. Sometimes, we should be a little bit better at accounting and be really on top of the game. It's also important when you think about digitization. We still need this basic skill. Without this, talking to the business doesn’t help us. We can't really show what we're able to do in our job. Another point is interest in empathy, especially when you work outside of your finance organization with different teams, and the awareness that most people outside of finance don’t love math. They don’t love numbers, and that's why they avoid us. So it's really important to try to change the perspective to see where they're coming from. Not everyone has studied business, administration, finance, or economics, so it's really important to try to speak their language to understand where they're coming from. **Chris Ortega** ChatGPT passed all four parts of the United States [CPA exam](https://www.financealliance.io/cfo-vs-cpa/). What that tells me is if there's a generative AI solution that's not a person that can pass the four parts of the exam, I think that shows that we're the baseline state. That should be the baseline expectation. Coming from an accounting background, you’ve got to learn the numbers, but if you're able to translate that accounting complexity into language in that communication, that connection, and that collaboration that the business can understand, that's that translation. GPT-4 can pass the CPA exam, but I’d love to see it try to explain ASC 606 to a salesperson. That's not going to happen. My point is that you‘ve got to know the accounting side of it. If I look at somebody who has a super strong accounting background, a CPA, and is naturally curious, I have somebody on my team that can build great relationships, and somebody who’s able to manage complexity, when you're looking at the business weight for weight, the value is going to be placed on more of those skills. Learning accounting is hugely important. But when you're looking at the value of where you want to invest that time, energy, and effort, people need to be thinking, *Where am I placing my bets on the future of my value to the business?* **Premal Parekh** Just to challenge that, when someone in the business says to me, “If I want to save costs in X place, will this make a difference to my EBITDA or not?” They won't know the answer to that, but I do know because I have the fundamental understanding of what an EBITDA impact is or a depreciation impact. Knowing that fundamental accounting puts you in a position of understanding value protection versus value optimization, which I think is that communication, collaboration, and connection. You really want to optimize value. And then the third one is really around full-on, brand new value that you can bring to a business through a brand new product, or you enter a brand new market where you probably think about a minimum viable product perspective. That's where you can business partner and use all of your knowledge and experience to decide whether it makes sense or not. I think there's a fundamental platform, however, with the automation that we're seeing right now, it's partly a concern for people in those areas. And I think that depends on the size and scale of the organization that you’re in, and where you are in your career maturity as well. Not every company is going to dive straight into automation or using generative AI. There are some first adopters, some very late adopters, and everybody else in between. So think about where your skills and your gaps are and look to build on those. Empathy is one of my favorite superpowers in finance. We can empathize with our business, we can empathize when things don’t go so well, and we can celebrate when things go really well for our business leaders. **Magdalena Sailer** ChatGPT is really great, however, I really want to emphasize that if you don't know the basic rules, you can't check if ChatGPT has given you the right answer. It's the same when you go into digitalization and AI. These tools are all great, but if you don’t understand the basics of statistics, it doesn’t help. --- [What is a CFO’s role in investor communications?A CFO’s involvement in investor communications is crucial for narrating a company’s financial story. As the top financial executive, you understand the past, present, and future of the organization better than anyone.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/pawel-czerwinski--0xCCPIbl3M-unsplash.jpg)](https://www.financealliance.io/cfos-role-in-investor-communications/) --- ## Purpose, impact, and people: Guiding your finance career **Premal Parekh** Beyond FP&A, what can you do with these skills? What do exit opportunities mean to us as finance people? And where can we add value to that process? **Chris Ortega** In terms of exit opportunities, I look at my own career which started in public accounting. I did corporate accounting, realized that wasn’t where my passion was, jumped into FP&A, got my MBA at the same time, made it to Director of FP&A and Finance, then went to another company and got all the way up to VP and CFO level. The thing that always helped guide my career was none of the vanity stuff. Throw out the titles, the pay, the power, and how it makes you feel. Find your purpose. There are three things that helped me make that shift and start Fresh FP&A. I wanted to chase purpose over praise. I wanted to follow my purpose, and I wanted my team across the globe that help support Fresh FP&A and our clients to follow our purpose, not just the praise. The second thing is to chase impact over income. Our clients, prospects, team, partners, and everybody we work with need to be united on this Northstar, which is utilizing our skills, passions, talents, and experiences to help others realize and achieve greatness. That's the impact we want to make on clients. That's the impact we want to make in the [fractional CFO](https://www.financealliance.io/how-to-become-a-fractional-cfo/) space. That's the impact we want to make on partners. Too often, people are chasing that job because it's $30,000 more. So chase impact over income. The last one is the most important one, which is chasing people over profits. People are your most valuable resource. Whenever you can focus on strategies and tactics and set the visions, the milestones, and the metrics where you're putting people at the front and not chasing profit, that’s where you're set up for success. For me, those were the three things that helped guide me into decisions I was making, from moving out of accounting to starting Fresh FP&A. And finally, take the leap of faith. The worst that can happen is it all fails. But there’s no such thing as failure if you learn. **Magdalena Sailer** It’s about connecting with different teams, whether it's an exit opportunity or any other development opportunity in a company. Connect with legal, connect with sales, connect with the taxes team, and so on. Sometimes, you only have a certain perspective, and other people can see other pitfalls and chances. So it's really important to connect, go and find friends in other teams, and you can automatically add value when everyone’s sitting at the same table. **Premal Parekh** Absolutely. I recently saw a poll that was done on a finance community that said 21% of people think about exit opportunities as a CFO on an ongoing basis. They’re always looking for possible opportunities for an exit if a lucrative option comes along. 40% do it one year in advance, and the rest will consider doing it two to three years in advance. With that in mind, if you're working within FP&A or working as a CFO or investor relations, it’s about understanding what you should be doing during these phases of a company's growth. Finance is the backbone of the business and has the opportunity to see all the different parts of a company and understand what value is being driven in the business from a KPI perspective. But sometimes even more importantly, what do the external people believe are the perceived value drivers of a company? You need to ensure those things are being addressed during your annual cycles, monthly cycles, etc. --- [Strategies to build an​​ effective FP&A functionThis article looks at proven strategies for an effective team and organizational structure in FP&A.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBen Shaw![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/pexels-fauxels-3184292--2-.jpg)](https://www.financealliance.io/building-an-fp-a-function-strategies-for-effective-team-and-organizational-structure/) --- ## Embracing new opportunities and learning from failure **Premal Parekh** How can you move out of finance? And how do you get involved with projects that aren’t finance-related? **Magdalena Sailer** If you intend to move out of FP&A and explore new fields, one key bit of advice is to always be learning. You can do LinkedIn premium courses or attend an online university, for example. If you want to learn something new, find different approaches and different courses, whatever you're interested in. I also suggest thinking about what kinds of people you want to connect with. We all have different personalities, and not everyone in FP&A is outgoing and extroverted and connects easily with everyone. So if you intend to move out of the profession, think about who you’d like to work with. Have a coffee, connect with them as human beings, and find out what's going on in different teams. Discover your specific interests on a personal level and then ask to collaborate on a project or suggest doing a project between different teams. No managers are against you making a suggestion or bringing up an idea. **Chris Ortega** Imagine you wake up and you’ve got $100 in your bank. 70-80% of that $100 for your learning and development is going to come from being on the job. The other 20-30% is going to conferences and events. That's the other majority of how you're going to learn and get outside of this. To give you a real-life example of when I took the leap of faith, I previously worked at a large pharma company as a Senior Financial Analyst. I said, “I want this ability to forecast R&D across eight different currencies in 30 different locations.” I took on that project and I failed because I didn't get the Singapore dollar conversion to USD correct. The CFO was about to go on a call with investors and we were submitting R&D labs, and I found it at the 11th hour. I was sitting there thinking, *Oh my god, this is going to be so bad*. The next day, I saw that I had a meeting scheduled with the CFO. And I was thinking, *Let me go get my cardboard box ready. Let me make sure my resume is good.* I was preparing for *that* conversation. The CFO sits down with me and gives me the best advice you can take in your career. She asked me this one question, “What did you learn from this?” I said, “I'm sorry, I take full responsibility. This is my mistake. Here's how I made the mistake; I didn't get the conversion done correctly. I should’ve looked at this. In the future, these are the things that I'm going to do to make sure that this doesn't happen again and that you're prepared. I learned from this situation.” She said, “Chris, you can’t carry that fear of failure. You jumped right into this, you made a mistake, you owned it, you learned from it, and you're going to be better in the future.” That was the turning point of my career. It's not like the world ended. Once you get over that fear of failure, you're able to get inside that business and find those MVPs, where you can test and learn and get feedback, real-life applications, and insights, and have a great group of trusted people that are going to call you out. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### 10 best financial modeling tools for better forecasting URL: https://www.financealliance.io/10-best-financial-modeling-tools/ Last updated: 2026-01-28T16:45:00.000Z Financial modeling tools are used to create accurate financial forecasts with the flexibility to manipulate variables and test different scenarios. But with new tools constantly entering the market and updates to existing ones, it can be overwhelming to decide which solution is right for your needs. 🛠️ In this article, we've highlighted key features to look for when choosing the right software - along with 10 of the best financial modeling tools that stand out in today's market.👇🏼 ## **What are financial modeling tools?** Financial modeling software is designed to facilitate the creation, analysis, and presentation of [financial models](https://www.financealliance.io/podcast/financial-forecast-model/). You can use financial modeling software to help make decisions about things like: - Investment analysis - [Risk management](https://www.financealliance.io/financial-crime-risk-management-fcrm/) - Budgeting and forecasting - Financial statement analysis - Accounts management - Raising capital They allow users to simulate financial scenarios, evaluate the potential impacts of different business decisions, and forecast future financial performance based on different assumptions and variables. ## **Why is financial modeling software important?** Financial modeling software matters because it lets you easily whip up complex financial models that would make your head spin trying to do by hand. Instead of getting lost in a tangled mess of spreadsheets, you can leverage these tools to analyze assumptions, [run scenarios](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/), and serve up results that give decision-makers that "a ha" moment about the best path forward. --- [Cost-benefit analysis: 5 steps to turn data into smarter choicesIf you want to learn more about what cost-benefit analysis is and how to do it, keep reading as we dive into five key steps to streamline your financial evaluations and drive smarter decisions. 🧠![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/cost-benefit-analysis.jpg)](https://www.financealliance.io/cost-benefit-analysis/) --- ## **Key features to look for in financial modeling tools** When you're on the hunt for the perfect financial modeling tools, there are key features to look out for. These features are important for effective [financial analysis](https://www.financealliance.io/data-cleaning-techniques/) and can make or break your modeling efforts. Here are a few to keep top of mind: ### **User-friendly interface** First things first, if you can't navigate it, you can't use it. The last thing you want to do is waste time trying to figure out how to use a poorly developed modeling tool. So, make sure to keep an eye out for one with an intuitive and easy-to-use interface. ### **Flexibility and customization** Look for financial modeling software that allows you to customize formulas, scenarios, and reports to fit your specific needs. ### **Integration capabilities** Good financial modeling tools should integrate seamlessly with other software such as data sources, accounting software, and other business tools. This is an important feature because it keeps your model up-to-date with the latest inputs. ### **Advanced analytical functions** A top-tier tool offers advanced functions that can handle complex modeling tasks, such as scenario analysis, Monte Carlo simulations, and [sensitivity analysis](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/), providing deeper insights into your financial decisions. ### **Collaboration features** Financial modeling is rarely a solo mission. Features that facilitate collaboration, like cloud-based sharing, real-time editing, and version control, helps put your team on the same page, which, in turn, enhances the accuracy and efficiency of your modeling process. ### **Data visualization and reporting** Look for financial modeling tools that offer robust [data visualization](https://www.financealliance.io/8-key-principles-of-data-visualization-in-finance/) and reporting capabilities, turning your complex data into easy-to-understand [graphs and charts](https://www.financealliance.io/financial-charts-and-graphs/) that can be shared with stakeholders to support strategic decisions. ### **Security and reliability** Finally, your financial data is sensitive and valuable. Opt for tools that prioritize security measures and data protection to keep your information safe from unauthorized access. The best financial modeling tools are easy to use, customizable, integrate well with other systems, offer advanced analytical capabilities, support collaboration, provide strong data visualization and reporting features, and ensure your data's security. --- [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/tools-pic-2.jpeg)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) --- ## **10 of the best financial modeling tools** ### **1\. Microsoft Excel** [Microsoft Excel](https://www.financealliance.io/chatgpt-for-excel/) remains a go-to tool for finance workers because of its easy-to-use grid format and wide range of formulas. It makes tasks like data entry, number crunching, graphs and even complex modeling simple. [Excel](https://www.microsoft.com/en-gb/microsoft-365/excel) is popular because it works on different devices and can be customized with plug-ins. It lets users play with pivot tables, charts, calculations and more. ### **2\. Cube** Cube is one of the better known financial modeling tools for taking forecasting further than basic projections. It lets teams create flexible, data-backed models in one system. By combining data sources, showing real-time performance, and automating repetitive work, Cube saves time and helps you get straight to the solutions that drive better business performance. ### **3\. Jirav** Jirav offers a comprehensive suite of [financial planning and analysis](https://www.financealliance.io/fp-a-vs-accounting-key-differences-every-finance-pro-should-know/) services. It excels in its ability to combine accounting, workforce, and operational data to provide integrated financial planning, forecasting, reporting, and analytics. Jirav stands out for its easy-to-use dashboards that make complex money details understandable. ### **4\. Finmark** Finmark simplifies money planning so almost anyone can start forecasting and modeling, delivering the power of high-end financial modeling tools *without* the steep learning curve. This tool helps startups and small business easily create, manage and update money models. It assists with budgeting, cash flow and runway predictions to guide smart spending. ### **5\. Python** [Python](https://www.financealliance.io/how-to-use-python-in-excel/) is a programming language that streamlines reporting and has become an invaluable tool for financial analysis. Its extensive library ecosystem supports a variety of finance-specific tasks, including data gathering, statistical modeling, and risk assessment. Python's flexibility makes it an excellent choice for both one-off analyses and automated financial systems. --- [M&A best practices: Navigating successful dealsTo help you craft a winning deal, we’ve compiled some M&A best practices that can help you not only survive the ordeal but also thrive, turning potential pitfalls into opportunities for growth. 🚀![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/compass-7592447_1280.jpg)](https://www.financealliance.io/m-a-best-practices/) --- ### **6\. Planful** Planful offers a continuous planning platform that merges [financial forecasting](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/), budgeting, and reporting. Its cloud-based design ensures finance teams always have access to up-to-date data, enabling more agile and accurate forecasting. With its scenario modeling, businesses can better navigate uncertainties and stay ahead of market shifts. ### **7\. Mosaic** Mosaic bridges financial data and business strategy through real-time insights, planning and predictive data, positioning itself as one of the leading financial modeling tools made for high-growth companies. With user-friendly and powerful features, Mosaic helps businesses understand performance, forecast future situations, and decide on data-driven moves quickly. ### **8\. Jedox** Jedox provides an integrated solution for planning, analytics, forecasting, and reporting. Its unified platform creates financial forecasts that are built on consistent and accurate data. Jedox is one of the most adaptable planning and performance management platforms available, allowing you to integrate data from any source, model any attribute, and create any set of business logic rules to [create accurate financial forecasts](https://www.financealliance.io/14-dos-and-donts-financial-forecast/) for your business. ### **9\. Sage Intacct** Sage Intacct is a popular financial reporting choice because it easily integrates with other systems for billing, accounting, orders and more. Its flexibility allows it to adapt as business needs change. With multidimensional data analysis, Sage Intacct enables detailed, insightful reporting. ### **10\. Anaplan** With its connected planning platform, Anaplan empowers businesses to develop robust financial forecasts in real-time. Its model-building capabilities, combined with granular data analysis, allow for in-depth scenario planning. The platform is designed to adapt quickly, helping [finance teams](https://www.financealliance.io/how-to-optimize-finance-teams/) respond proactively to ever-changing business conditions. --- ## FAQs: Financial modeling tools #### ****Q. Can you automate financial modeling?** Yes, you can automate parts of financial modeling using software like Excel with macros, Python scripts, or specialized financial modeling platforms that offer automation features. #### ****Q. Which software is used for financial modeling?** Software used includes Excel, Google Sheets, QuickBooks, and Python for more advanced stuff. Special financial modeling programs like Anaplan and Quantrix are also used. #### ****Q. What does a financial model show?** A financial model shows predictions about how much money a business will make or spend in the future. It helps in planning and making decisions. --- ### Download our Finance Tools of Choice Report Our ultimate directory of finance tools is here, bringing you the best tools and software that finance pros swear by. We've gathered insights from industry leaders to spotlight the tools finance professionals can’t do without. These aren't just any tools; they've been vetted, tested, and proven effective. For every category, we unpack the fan-favorites, giving you a deep dive into: - **Essentials:** Understand the core purpose of each tool and the reasons finance experts consistently choose it. - **Strengths:** Discover how each tool can seamlessly integrate into your operations, optimizing your financial workflows. - **Investment insights:** Get a clear cost breakdown, helping you make informed budget decisions. Download [Finance Alliance’s Tools of Choice report](https://www.financealliance.io/finance-alliance-tools-of-choice/) today! [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/10/FA_Tools_of_Choice_2023_CTA_Banner.png) ](https://www.financealliance.io/finance-alliance-tools-of-choice/) ### Financial leadership in changing times URL: https://www.financealliance.io/financial-leadership-in-changing-times-2/ Last updated: 2025-04-07T10:02:16.000Z My name is Lindsay Jesperson, and I'm excited to share my experiences and some of the strategies that have helped me navigate this age of accelerated digitization and uncertainty. I’m going to talk specifically about the transitional and seismic shifts that have happened in my career that have led to periods of uncertainty and ambiguity, and how we deal with that as [FP&A](https://www.financealliance.io/fp-a-for-startups/) and finance professionals. I’ll also share the strategies that I've found are most effective in leading your businesses, your teams, and yourselves personally. - [Helping businesses navigate uncertainty](https://www.financealliance.io/p/e57aead9-a140-47b2-adeb-a3059aa5c5b7/#helping-businesses-navigate-uncertainty) - [Experiencing the global financial crisis at General Electric](https://www.financealliance.io/p/e57aead9-a140-47b2-adeb-a3059aa5c5b7/#experiencing-the-global-financial-crisis-at-general-electric) - [Dealing with seismic shifts in the media landscape](https://www.financealliance.io/p/e57aead9-a140-47b2-adeb-a3059aa5c5b7/#dealing-with-seismic-shifts-in-the-media-landscape) - [Revenue transformations in the film industry](https://www.financealliance.io/p/e57aead9-a140-47b2-adeb-a3059aa5c5b7/#revenue-transformations-in-the-film-industry) - [3 key strategies for handling change and uncertainty](https://www.financealliance.io/p/e57aead9-a140-47b2-adeb-a3059aa5c5b7/#3-key-strategies-for-handling-change-and-uncertainty) ## Helping businesses navigate uncertainty We're always in a period of digitization that we can't control and will always be evolving, but what we can control is that perception of acceleration and uncertainty. I started my professional career in banking and have held multiple roles in both strategic and operational finance, with responsibilities across film and television, both on the production side and distribution, and nearly always on a global scale. I’ve worked for Comcast, Disney, Bloomberg Television, Viacom, CBS, and GE. The interesting thing that ties all of my roles together is that I've always come to them during a period of change. I started at NBC to integrate the universal acquisition for the global film distribution business. At CBS, I replaced a leader who was retiring after 30 years and the business was ready for a new change. And then I went to Disney to help the division president with new initiatives to take ABC News in a more digitally focused direction. As finance functions broaden with our greater responsibilities, we get to play an important role in helping businesses navigate [transformation](https://www.financealliance.io/what-is-finance-transformation/) and leading during uncertainty. There are always parts of our jobs that are uncertain and ambiguous, so becoming comfortable leading and operating with this ambiguity is what's going to be critical to our success. I think we can all attest that finance is a function that only continues to broaden. Our financial insights help drive not only executive-level decision-making, but a full range of how we operate on a daily basis over a business's lifecycle, and then ultimately how that business competes in its market. --- [FP&A automation: Trade manual work for strategic impactIf you’re ready to step off the reporting treadmill and focus on projects that drive valuable insights and strategy, then it’s time to embrace automation in FP&A.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/ai-generated-8293345_1280.jpg)](https://www.financealliance.io/fp-a-automation/) --- ## Experiencing the global financial crisis at General Electric I began my professional finance career at General Electric (GE) in 2003\. The company was at the top of its game at the time and sold everything from medical equipment, jet engines, appliances, plastic pellets, film and television shows, and industrial products. It also had its own financial arm for both commercial and personal banking. I was lucky enough to be on the financial management program, which was an entry-level development program for analysts to be dropped into various operating units, given exposure to all areas of the finance discipline, and serve as its pipeline for [future CFOs](https://www.financealliance.io/the-future-focused-cfo-from-backseat-drivers-to-strategic-navigators/) and finance executives. In January 2005, I was a young 20-something analyst/ It was my second rotation, and I was lucky enough to be at the global headquarters where the personal banking unit was. This unit handled credit cards, home equity, lines of credit, and mortgages. It was a classic FP&A role and one where my analyst responsibilities were to collect and consolidate metrics for the division. In this case, as part of the mortgage metrics collections, I was to start tracking the foreclosed or repossessed houses worldwide. Our story begins with five houses. As any good FP&A analyst does, I’d set up my spreadsheet template, sent it out with instructions, got it back from all the business leads, and in January, I presented the five houses globally to my manager. Great, job done. In February, I had to repeat the task, and the number of houses had increased fivefold to 25\. I submitted the houses to my manager and was immediately called into his office. He spoke to me about the importance of accurate data, how it looked simple but was crucial for decision making, that this data was going to be seen by the CFO and CEO, and it was going to be reported on the GE annual report, etc. He’d assumed that I hadn't collected the data correctly and I’d missed responses the first time. I promised to do better and was sent back to my desk to double-check the data again. And of course, all the answers came back confirmed. In March, I was asked to do this a third time, and 127 houses came back. And this time, my manager was much harsher. He said that I couldn't be trusted, I clearly didn't understand the ask, and anything in finance probably wasn’t the right career path for me. He’d be taking this task away and doing it himself next month. April came in at 630 repossessed houses. And to this day, I've never seen anyone look quite so horrified and scared as my manager did on that day when he compiled the data and saw the subtotal for himself. And of course, there was a huge panic and a lot more conversations well above my paygrade. But that was the very beginning, at least for me, of the global financial crisis, and my first taste of massive industry disruption in my career. The funny conclusion to that story is fast-forward to eight months, in my final rotation, I was sent to Watford, UK to help with the country-level mortgage business. Those few houses that were on that first report became a giant box of keys. It was kept in the pricing manager's office because they quite frankly weren't sure what to do with it. As you can imagine, the realization set in that in every office in every region, and every too-big-to-fail bank was a similar box of keys representing the houses and families impacted. That shifted my scale of understanding what it was like to be in a business that was going through uncertainty and ambiguity, what that was going to mean, and how it was going to impact me on a day-to-day basis. But that's not the end of the story. That's just the beginning. --- [How to use a driver-based forecast to drive strategic initiativesConnecting your forecasting to the company’s strategic initiatives is a great way to make sure finance is playing a leadership role in moving the company forward. It’s also a great way for an FP&A business partner to get more exposure and add more value.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceChris King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/why-kei-8e2gal_GIE8-unsplash.jpg)](https://www.financealliance.io/how-to-use-a-driver-based-forecast-to-drive-strategic-initiatives/) --- ## Dealing with seismic shifts in the media landscape When I finished the rotational program, I was at a crossroads. Did I stay in seismic shift number one in banking and potentially spend the foreseeable future digging out of that financial market meltdown? Or was this an opportunity to pick an industry and change paths? To take this opportunity at the crossroads to potentially do something more fun, exciting, and stable? So with that, I switched divisions and shifted my career into media at NBC Universal, which was still owned by GE at the time. And what I didn't know was that I was trading a seismic shift in one industry for another. What I hadn't yet realized was that there were always going to be seismic shifts regardless of what industry you were in. So I very confidently rolled into seismic shift number two. In this next case, I wasn’t that analyst collecting the exact data at the exact moment to indicate another massive, impending global collapse. That would’ve been too much of a coincidence. The seismic shift was much slower and disruptive in different ways and far-reaching on a different scale. This seismic shift that was happening in media was playing at a much slower pace, luckily for me. But if you remember, back in 2006, a few things were going on. Piracy was on the rise, which meant you could get a pirated DVD on Tottenham Court Road for $5\. They were selling them out of their backpacks when the original was still on the high street shops for nearly five times the cost. That was an indicator of some of the new formats that were becoming accessible, and this posed an increased risk. The second thing that was happening was that technology was massively improving in terms of quality. We were shifting from HD to 4k quality, and the rise of connected TVs in the form of OTT (over-the-top television) was also being launched and integrated into people's homes. That also led to the rise of SVOD, or subscription video on demand, which provided viewers with an on-demand alternative to linear and cable offerings. My company had announced a little joint venture at the time called Hulu. The genesis of that was that the recognition of this early data, similar to those repossessed houses, was showing that the traditional analog dollars were being traded for digital pennies, as it was called. The fact that this trade-off was happening was going to have massive implications for how the business functioned and where the revenue was coming from, so we needed to start shifting what we were going to do about it. But back in 2006, we were a little early. Or were we? Like those repossessed housing metrics being indicative of larger cracks, these early warning signals were actually being planned for and thought about. As we fast forward 10 years to 2016, in hindsight, audiences were shifting away from traditional linear and cable broadcasts, and increasingly moving to digital platforms. ![Graph showing the time spent per day with digital versus traditional media in the United States from 2011 to 2023](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/Screenshot-2024-02-12-at-09.47.23.png) In real-time in 2022, this seismic shift is still going on. We're still living through it, and there's still a lot more happening. But what does this mean for media finance professionals in real-time? It means that the whole model of how you forecast for studio business has changed. It changes the way we plan for our film slates. It changes how we go to market. It changes how we make money, and that's also how we spend money, and how we bring those film and television products to market in their production. So what does that actually mean? And what does that really look like? ## Revenue transformations in the film industry When you think about a film process, the previous lifecycle started off as a seed of intellectual property (IP). Usually, that's in the form of a book, a novel, a graphic novel, or a comic book series. They go through a development process, get produced, and then once the film or films are ready, they get distributed out into the different markets. Previously, films would traditionally make the most money in their first theatrical windows. This would usually be in the box office when you’d go domestically on the US side or internationally. In those pay theatrical windows, they’d go on to have a wider distribution, usually on what's called the pay one or pay two window. That’s when those films go on to an exclusive service, then onto a television network, and then possibly onto a DVD. You could previously estimate the popularity of a film or similar ones to it, and use that to determine how much you're going to spend on the next one based on that box office performance. That could drive how much money you spend actually producing the film and how much you're going to market it next time. And as you're building up those bigger slates to have all those individual pieces, you have a very clear idea of what the next few years of the business look like. That's massively changed. Now those windows have shrunk. In some cases, films aren’t getting released in theatrical windows at all; they're going directly to platforms. It's caused a massive shift in how the revenue is accounted for, and therefore how we're going to think about building up a slate production spend, marketing spend, and distribution spend. ![Graph showing how money flows have changed over time in the film industry in terms of revenue and expenses](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/Screenshot-2024-02-12-at-09.51.00.png) Below is a very simplified example of what I'm talking about, this shift that’s happened now. You can also say that's been accelerated by the behavioral changes from the pandemic. ![Bar chart showing how film revenue has decreased from a family spending $100 at the box office to $10 to watch the same film at home](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/Screenshot-2024-02-12-at-09.51.19.png) In terms of what a film previously earned, let's say a family of four went to a theatre, that's about $80, plus $20 for concessions. So in that window, that’s $100 to see that film. That same film is now being watched at home by that family of four for around $10 a month. That's probably also being allocated based on all the services and things that they're watching, depending on which studio it is. Going from $100 to $10 has a huge impact. To make the same high-quality films and television shows, you're not necessarily going to drop your production budget from 100 to 10\. A Marvel film isn’t going to get made at 1/10 of the cost, nor are you going to be able to market or even distribute it on that platform. So media companies are now grappling with the fact that we need to overhaul all of the production, marketing, and distribution plans to support what feels and may look like a very similar product, but that has very different revenues attached to it now. Yes, these revenue models may be overhauled and these pricing ideas might be changed. But there's a massive shift that’s impacting how this business is thought about and is going to continue to change how these businesses are thinking about it going forward. This seismic shift plays out over a much longer period of time, mostly because media assets always have a runway of a few years. So with the things that are happening now, we're not going to see many of them play out for the next few years. But stay tuned because this shift hasn't fully happened. There are going to be lots of changes coming in the next few years that are going to be impacting what this is. --- [5 CFO trends 2024 | Finance AllianceThe future is never certain. Yet, as Chief Financial Officers (CFOs), anticipating the future is an essential part of the job. So, what should be on your radar for 2024? 🤔 Below, we explore some of the biggest CFO trends of 2024 that look ready to reshape finance priorities and functions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/cfo-trends-2024.jpg)](https://www.financealliance.io/cfo-trends-2024/) --- ## 3 key strategies for handling change and uncertainty So where does that leave us? What did we learn from these stories? And what are you going to take with you to navigate change and uncertainty in your own worlds? I thought about this from three different perspectives: you as the business professional, you as the FP&A leader, and you as the CEO of your own career. It's important to remember that we all wear many hats, and to be effective at strategy, you need to consider the problems and the impacts from multiple perspectives. So I've distilled it down into three key strategies: ### Tackle it head-on Uncertainty and ambiguity are everywhere all the time. There are always going to be seismic shifts in your industry and your work. In an alternative universe, maybe I’d still be a banker, and maybe it wasn't all that I feared. But my point is that avoidance isn’t always the best option, and it's not the only option. It’s best to consider other alternatives. You've already been living with uncertainty and ambiguity, and you've probably gotten quite good at it. We survived the global pandemic, but how did you survive? You adapted to the information you had. If you didn't think you had it before, you probably have a very high tolerance for ambiguity now. How did you learn to cope? It probably came down to what you chose to pay attention to and how you chose to react to it. In our FP&A lives, we're never going to have all the answers or all the details. For 20 years of my career, I've always heard, “But what if it changes next week? How are we going to know what's going to happen 12 months from now?” It's not about being absolutely precise. We can all pull out budgets designed at the end of 2019 and laugh about how far off they are from what actually happened. But it's about thinking about the information now to make your best guess and quantify it. Of course it's going to change tomorrow, and of course something new will happen. That's one of the fun parts about what we do. It's not static and there's always going to be a business change. But at the time of publication, what was the most thorough, most accurate, most thoughtfully based plan that you could come up with based on what was reasonable at the time? It's important to think about those plans and decide on those strategic plans to take them all into consideration. ### Don't be surprised. Be prepared. The best finance and FP&A professionals are the ones who are great at understanding the strategic planning part *and* the operational execution. We're in a lucky position to be able to critically think about these KPIs, look at early warning cracks that show up, pay attention to them, and scenario plan for what it’ll mean for your business and yourself personally. And then what are you going to do about it today to be able to handle that tomorrow? The first step is to not deny it or procrastinate. Don't put it down. The best way I've heard it described was from one of my favorite strategy professors at London Business School, Julian Birkinshaw. His suggested approach is a phrase that I really like, which is, ‘Be paranoid and pragmatic.’ Operate like you feel like you're being threatened and figure out what you're going to do about it. And the pragmatic part is to deal with it sensibly and make realistic plans. We see this on every FP&A person's favorite sensitivities page of risks and opportunities. What impact does the issue have on the revenue, cost, net income, and overtime? Is it 50%? Is it 80%? What’s the likelihood? Does that have a probability attached to it? When you scope out the magnitude and think about those assumptions that drive it, you're actually deconstructing that complexity and making it more certain. From a leadership perspective, talk to people, socialize the ideas, share those perspectives, and make sure you're helping to future-proof your business by ensuring that teams are prepared and have their game plans ready. Having a plan and really thinking about the ‘what ifs’ and the details is crucial. In real-time, you might not be able to execute it precisely. But you do need to be flexible and spontaneous to make decisions on the fly, except they're not on the fly if you've thought about them ahead of time. There are always going to be factors that guide you differently. You're not getting graded on perfectionism. It's the planning and consideration that’ll make sure you have a successful outcome. And on the ‘be prepared’ side, make sure you're ready for what's next, whether it's your next job, a lateral move, a promotion, an external opportunity, or a new industry. Nobody’s going to tell you, “Hey, there's an amazing opportunity coming your way in six months. Make sure you're ready for it.” You need to be ready now. You need to be expanding your skill set, operating at that next level, and proving to yourself, the hiring managers, recruiters, and interviewers that you're ready and practiced in whatever will come next. That’ll improve the likelihood that you'll not only get that job and be hired but also improve the likelihood that you'll be brilliant at it. ### Find the upside Not all uncertainty is bad. Not all transformations are bad. I'll tell you a quick story that's close to my heart. When I was at CBS in London, we were asked to execute a round of layoffs. It was a small office, so everybody knew about the confidential layoffs that were coming. I had one employee on my team who was nearing retirement age. She was utterly grief-stricken about what was going to happen to her, to the point where she’d cry in the office in absolute fear of the potential dreadful outcomes and was unable to contemplate anything that would be more positive than those. It was really hard for all of us to see. Our hearts were breaking for her. But nobody could do anything to comfort her, and I couldn't tell her about anything that was coming yet. But what happened was that her redundancy package was large enough that she paid off her mortgage on her house and filled up her savings account. We’d structured it so that we could offer her part-time project employment to help her make ends meet. She politely declined because she decided that she'd be spending the next several weeks traveling, and then being busy with her new language classes. She didn't know if she could fit in our part-time offer. Talk about a transformation. I’d never seen her so ecstatic. So what's the lesson there? Don't get stuck in just one perspective. Keep your mind open, get other people's input, and consider the alternatives. Sometimes it's easy for all of us to go into the death spiral thinking, and there are probably lots of folks around you who’ll be happy to commiserate and reinforce that. But always remember that there's another way and there might be another end to this story or different paths that you can take. You might not see it immediately. It might be hard to get to. But that’s fine. You've done hard things before. But your job now is to think about what makes that alternative true and realistic. The hardest part is forcing yourself out of that death spiral thinking and coming up with alternatives. That’s what's going to increase the likelihood of your success. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### M&A best practices: Navigating successful deals URL: https://www.financealliance.io/m-a-best-practices/ Last updated: 2025-04-10T07:50:12.000Z ## **9 M&A best practices** Leading a successful M&A deal is a defining moment for any CFO… but that doesn’t make it easy. Maximizing value while minimizing risks in these complex deals requires a delicate balance, strategic foresight, and careful planning. To help you craft a winning deal, we’ve compiled some M&A best practices that can help you not only *survive* the ordeal but also *thrive*, turning potential pitfalls into opportunities for growth. 🚀 ## **1\. Setting the stage for M&A success** Once the decision has been made to pursue an M&A, one of the first tasks usually involves making sure everyone is on the same page. This means bringing management teams together to develop a cohesive game plan. ![](https://media.tenor.com/YbSk1325RrcAAAAC/will-and.gif) Brainstorming sessions with business heads, legal counsel, and your CEO can help build consensus on priorities and principles for evaluation. To help facilitate a productive discussion, try posing some strategic questions, such as: *What are our *motivations* for pursuing an acquisition or merger?* *How can we deploy M&A to achieve our *growth objectives*?* *What types of *targets* align with our *strategic roadmap*?* *How will success be *measured* if a deal materializes?* Ensuring alignment on these questions not only clarifies the direction and objectives of the M&A process but also sets a solid foundation for any following steps. Don’t forget to document these priorities and principles! You’ll want to refer to them throughout the merger or acquisition to help guide the decision-making process. --- [CFO and CEO relationship: 5 ways a CFO can support the CEOIn this post, you’ll learn what a CEO needs from their CFO, and what you can do to support the CEO on a day-to-day basis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2022/08/handshake-g5cf73343d_1920-1.png)](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/) --- ## **2\. Understanding components of value creation** Once the strategy is set, you’ll enter one of the most crucial phases - identifying and valuing potential M&A targets. An M&A target refers to a company that has been identified as a potential candidate for acquisition or merger by another company. In the context of mergers and acquisitions, the target is the company that is to be bought or *merged* with. So, how can you identify and value targets? A good place to start is by leveraging market research and [data analytics](https://www.financealliance.io/use-of-data-analytics-and-bi-tools-trend-3-transforming-fp-a/) to pinpoint companies that align with your strategic objectives. Utilize industry reports, financial databases, and competitor analyses to create a shortlist of potential targets. Key components to assess when valuing targets include: ![Key components to assess when valuing M&A targets](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/M-A-best-practices1.png) Performing a thorough due diligence process will also uncover any financial, legal, or operational risks that could affect the valuation and eventual integration of the target company. This step is a cornerstone of M&A best practices, ensuring that potential pitfalls are identified and addressed early in the merging process. 💡 Remember, identifying and valuing targets is not just about the numbers; it’s about finding a strategic fit that can drive long-term value for your organization. ## **3\. Identifying opportunities for growth** Now it’s time to pinpoint key growth opportunities. Deploying proactive market intelligence and [networking strategies](https://www.financealliance.io/11-networking-in-finance-tips/) will help you lock in deals with the best growth synergies. Focusing on growth potential is important because it ensures each merger and acquisition isn’t just a financial investment, but a strategic move that can help the company grow. 📈 Here are some tips to help identify these opportunities: ### **Conduct market analysis** Keep a close eye on what’s going on in the market. Are there any emerging sectors? Declining industries? Areas in desperate need of innovation? Market analysis will help you pinpoint sectors where an acquisition could provide a competitive edge or fill gaps in the company's portfolio. ### **Evaluate strategic fit** Assess how potential targets align with your company’s long-term strategic goals. For example, you might want to think about how an acquisition can diversify offerings, enhance product lines, or expand geographic presence. ### **Leverage network and advisors** Utilize the knowledge and connections of industry experts, investment bankers, and M&A advisors who can provide insights into potential opportunities and facilitate introductions. ### **Monitor competitors** Pay attention to competitors' M&A activities, as these can reveal emerging opportunities or sectors worth exploring. ### **Innovate internally** Encourage internal teams to identify potential acquisition targets that can enhance or complement existing operations, products, or services. --- [Cost-benefit analysis: 5 steps to turn data into smarter choicesIf you want to learn more about what cost-benefit analysis is and how to do it, keep reading as we dive into five key steps to streamline your financial evaluations and drive smarter decisions. 🧠![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/cost-benefit-analysis.jpg)](https://www.financealliance.io/cost-benefit-analysis/) --- ## **4\. Crafting compelling investment cases** Once high-potential M&A targets are identified, it’s time to transition into the role of deal champion. In other words, you need to craft compelling cases that justify the investment and outline the value creation roadmap. ![](https://media.tenor.com/CbhnRg0n7ksAAAAC/kermit-the-frog-looking-for-directions.gif) To help with this, you can lay out frameworks that quantify each dimension of a proposed deal, including: - **Strategic rationale:** Details on how target acquisition accelerates key priorities. - **Growth potential:** Granular breakdowns of revenue and cost synergy opportunities. - **Risk factors:** Analysis of integration challenges and mitigation plans. - **Financial returns:** Models projecting IRR, NPV, and pro forma impacts across [finance metrics](https://www.financealliance.io/infographic-financial-performance-metrics/). - **Exit options:** Evaluation of divestment potential via future sale or IPO. Ultimately, your aim is to create an objective risk-reward breakdown with evidence demonstrating how the deal powers **strategic growth**. ## **5\. Determining returns on investment** One of the most important M&A best practices is to make sure the numbers make sense. This means backing investment cases with financial modeling and determining reliable ROI projections. You’ll need to rely on models to assess the viability of any M&A deal *and* optimize structuring for maximum returns. Techniques used include: ![models to assess the viability of any M&A deal ](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/Screenshot-2024-02-09-at-13.45.48.png) ## **6.** **De-risking M&A activities** M&As tend to come with execution risks that can erode value pretty quickly. From regulatory to integration challenges, it’s important to both monitor and mitigate common risk factors. Some potential [M&A risks](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) to focus on include: - **Financial risks:** *Shortfalls in synergy capture, hidden liabilities, financing cost overruns, etc.* - **Valuation risks:** *Overpayment due to forecast inaccuracies or optimism bias.* - **Integration risks:** *Poor system consolidation, cost alignment delays, and culture clashes.* To help avoid risks, assemble cross-functional teams and processes to swiftly address hiccups. establishing regular sync cadences, and rapid intervention protocols. It also helps to [develop contingency plans](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) to prepare for potential events like economic shifts or loss of leadership. --- [5 CFO trends 2024 | Finance AllianceThe future is never certain. Yet, as Chief Financial Officers (CFOs), anticipating the future is an essential part of the job. So, what should be on your radar for 2024? 🤔 Below, we explore some of the biggest CFO trends of 2024 that look ready to reshape finance priorities and functions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/cfo-trends-2024.jpg)](https://www.financealliance.io/cfo-trends-2024/) --- ## **7.** **Engage in effective negotiation** Another important M&A best practice is to employ strategic negotiation tactics to achieve favorable deal terms while maintaining a good relationship with the target company. Easier said than done, we know. So, here are some useful tactics CFOs often deploy to help negotiate successfully: 1. **Anchoring:** Establish reasonable valuation goal posts early, referencing detailed financial analyses. 2. **Active listening:** Uncover the underlying interests of the target through empathy and inquiry. 3. **Bridging:** Offer creative shared value solutions addressing both sides’ core concerns. 4. **Alternative option creation:** Construct contingent structures providing flexibility as uncertainties develop. ## **8\. Communicate transparently** With so much going on during a merger or acquisition, it’s easy for communication to fall by the wayside. But here's the thing—keeping everyone in the loop, from your employees and shareholders to your customers, is not just good manners; it's a strategic move that can make or break the success of your deal. By communicating transparently, you're not just sharing information; you're building trust, managing expectations, and laying the groundwork for a smoother transition. Here are some tips to help keep stakeholders in the know: ### **Start early** As soon as an M&A deal is under serious consideration, start planning *how* and *when* you'll communicate key messages. Waiting too long can fuel rumors and anxiety. ### **Be consistent** Ensure your messaging is consistent across all channels and stakeholder groups. Mixed messages can lead to confusion and erode trust. ### **Use the right channels** Different stakeholders might require different communication methods. While employees might benefit from in-person meetings or internal newsletters, shareholders might prefer official press releases or regulatory filings. ### **Balance honesty with sensitivity** Be as open as you can about the reasons for the merger, the expected outcomes, and how it will affect various stakeholders. However, be mindful of the anxieties and concerns these changes might provoke. It's about finding the right tone that is honest yet reassuring. ### **Encourage feedback** Make it a two-way street by inviting questions and concerns. This not only helps in addressing specific issues but also makes stakeholders feel valued and heard. --- [12 proven strategies for managing liquidityLiquidity management is about ensuring your company always has enough cash, not just for the daily grind but also for tempting growth opportunities. It’s a financial balancing act that involves…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/water-3007467_1280.jpg)](https://www.financealliance.io/12-proven-strategies-for-managing-liquidity/) --- ## **9\. Prioritize IT and systems integration** When merging companies, the integration of IT systems is critical to avoid operational disruptions. This step is crucial for ensuring that all technology platforms and infrastructure work seamlessly together from day one. This is where M&A tools come into play, offering essential support for a smooth transition. Leveraging these tools is part of following M&A best practices, as they can significantly streamline the process of merging IT systems, ensuring a more efficient and less disruptive integration. **Key areas where M&A tools make a difference:** ![Areas where M&A tools make a positive difference](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/02/Screenshot-2024-02-09-at-13.48.56.png) By prioritizing IT and systems integration and leveraging the right M&A tools, companies can minimize downtime and maintain productivity, setting the stage for a successful merger. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/10/FA_Tools_of_Choice_2023_CTA_Banner.png) ](https://www.financealliance.io/finance-alliance-tools-of-choice/) ### How to use a driver-based forecast to drive strategic initiatives URL: https://www.financealliance.io/how-to-use-a-driver-based-forecast-to-drive-strategic-initiatives/ Last updated: 2025-10-01T11:11:21.000Z Connecting your [forecasting](https://www.financealliance.io/3-cash-flow-forecasting-challenges/) to the company's strategic initiatives is a great way to make sure finance is playing a leadership role in moving the company forward. It's also a great way for an [FP&A](https://www.financealliance.io/fp-a-for-startups/) business partner to get more exposure and add more value. In this article, I’ll cover: - [What is strategy?](https://www.financealliance.io/p/e4abe240-944e-48fd-af43-2c3326e4da5f/#what-is-strategy) - [Top tools successful companies use to translate strategy into action](https://www.financealliance.io/p/e4abe240-944e-48fd-af43-2c3326e4da5f/#top-tools-successful-companies-use-to-translate-strategy-into-action) - [What is driver-based forecasting and why is it important?](https://www.financealliance.io/p/e4abe240-944e-48fd-af43-2c3326e4da5f/#what-is-driver-based-forecasting-and-why-is-it-important) - [Applying driver-based forecasting to a real-world example](https://www.financealliance.io/p/e4abe240-944e-48fd-af43-2c3326e4da5f/#applying-driver-based-forecasting-to-a-real-world-example) - [Changing the conversations your company is having about financial results](https://www.financealliance.io/p/e4abe240-944e-48fd-af43-2c3326e4da5f/#changing-the-conversations-your-company-is-having-about-financial-results) ## What is strategy? It's surprisingly hard to find a good definition of strategy. But I prefer Patrick Lencioni’s definition in his book, ‘The Advantage.’ He says: *“An organization’s strategy is nothing more than the collection of intentional decisions a company makes to give itself the best chance to thrive and differentiate from competitors.”* If a strategy is the intentional decisions that a company makes, then having a good strategy means you've made some good decisions about what the company must do differently. But to be successful, you also have to successfully execute that strategy. That's the hard part. The company has to translate that strategy into initiatives that someone in the company will own. And if brought about successfully, that’ll bring the desired result and financial impact. So how do successful companies do that? They start by using one of several tools to translate strategy into action. Let's look at some of those tools. ## Top tools successful companies use to translate strategy into action ### 6 critical questions Patrick Lencioni suggests creating clarity throughout the organization with six critical questions: 1. **Why do we exist?** This is a really important anchoring question for strategy. Why do our customers and our suppliers need us between them? When companies lose sight of the role they play in the value chain, they’ll start to go in the wrong strategic direction. 2. **How do we behave?** This question is about culture and values. 3. **What do we do?** This is being clear about what business we’re in and knowing when we’re just chasing $1 and getting outside of our sweet spot or niche. The last three questions are where the translation of strategy to action occurs. 1. **How will we succeed?** 2. **What’s most important, right now?** 3. **Who must do what?** Question four is the ‘what.’ What’s our strategy? Question five is the ‘how.’ How will we bring it about? ### The 4 Disciplines of Execution Another popular and effective execution tool is called ‘4DX’, or ‘the 4 Disciplines of Execution.’ It comes from FranklinCovey, in a book by Chris McChesney. The first discipline teaches us to ‘focus on the wildly important.’ In other words, how will we exceed and what’s most important right now? Discipline two is to ‘act on the lead measures.’ If you read this book or take the course, you’ll hear about the differences between lead and lag measures. Lag measures are the results that we want but often can't act on directly. Lead measures are the things we *can* act on and measure that’ll in turn act on the lag measures. In [driver-based forecasting](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/), the drivers are lead measures. Again, this tool helps you to identify the ‘what’ and the ‘how.’ ![The 4 Disciplines of Execution](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/01/Screenshot-2023-01-23-at-12.42.10.png) ### Objectives and key results (OKRs) Some people think about lead measures as KPIs, but when we’re translating strategy to initiatives, they're more like OKRs. There's a difference between KPIs and OKRs. You can think of KPIs as indicators about your business as usual, and OKRs as measures of how strategic initiatives are going. The concept of OKRs was developed by Andy Grove at Intel, and brought to Google by Intel employee turned venture capitalist, John Doerr. John explains the concept in some detail in his book, ‘Measure What Matters.’ **Objectives** describe what needs to be done differently. **Key results** are the things that need to happen in the near term to make the objective come true. Do you see the similarity to the 4 Disciplines of Execution? The objectives are the lag measures, what we want to have happen. They’re the ‘what.’ Key results are the actions we plan to take to act on the lead measure, and the specific impact on the lead measure we hope to have. It's the ‘how.’ It's another tool to translate strategy into actions. ### Hoshin Kanri Hoshin Kanri is the lean version of strategic initiative deployment. You’ll see the concepts of ‘what’ and ‘how’ as three to five-year breakthrough objectives get broken down into initiatives with clear results and target metrics. ![Diagram of the Hoshin Kanri X-Matrix](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/01/Screenshot-2023-01-20-at-16.23.38.png) If your company is using one of these four tools or something similar, you can supercharge the effort with a good driver-based forecast and bring finance and financial results to the center of [strategic planning](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/). On the other hand, if your company doesn’t have a good tool for translating strategy into action, then you might be the one to introduce one of these tools. ## What is driver-based forecasting and why is it important? When I talk about driver-based forecasting, I'm talking about the Beyond Budgeting movement. It's been around for a long time and is clearly superior to annual budgeting. However, the torturous annual budgeting process is so ingrained in the way boards control companies, CEOs control management teams, and the way bonuses work, that it’s alive and well in somewhere between 75% and 90% of companies. So it's no surprise if your company still does an annual budget. I’ve found that the best way to get rid of the [budget](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) is to make it irrelevant. The best way to do that is to have a good five-year driver-based rolling forecast that connects the strategies to the initiatives necessary to achieve the results we want. In other words, it's often easiest to add a DBF to what you’re currently doing. Maybe introduce it in the middle of the year, extend the visibility well past year-end, start to use the next year's forecast as a base for your annual planning process, and then eventually drop the budget and all the problems that go with it. Let me try to convince you why the driver-based forecast is the most important financial tool a company can have. Let's start with what a forecast isn’t: **It's not a prediction**, since the purpose of business forecasting is not to foretell the future, but to change it. **It's not a commitment**, since forecasts need to change to reflect the changes in the environment. **It's not precise**, because it's neither possible nor necessary. How does this differ from an annual budget? Companies often act like a budget is a contract between management and the board, a CEO and the department head, or a department head and a manager. You agree to spend less than this budget, and if everyone hits their department budget, then it’ll add up to meeting the company budget, and we'll get the bonus the board agreed to. The etymology of the word ‘budget’ shows it came from the word for leather bag, purse, or wallet. Managers tend to feel like they've been given a bag of money and they can spend it how they like. If they don't spend more or ask for more, they probably won't have to discuss how they spent it at all. But an agile organization must adjust its spending plans as it starts to see the results of its initiatives. The purpose of a budget is to control spending. The purpose of a driver-based forecast, on the other hand, is to enable the creation of grounded and connected strategic and financial plans. To be useful, it doesn't need to be detailed down to the GL account, it just needs to indicate what's driving future performance and how our initiatives are going. We need to identify and track the right drivers. Once you identify the drivers of your financial performance, you can think of the recent trends of those drivers like balls flying through space. They have a trajectory and a velocity. They may be accelerating or decelerating. Based on the past, we can project their path into the future. If we add up the financial results of the drivers continuing on their current course and speed, we can see what our results will look like if we allow these drivers to continue as they are. If we don't like the result, we have to apply a force to it and nudge that driver to change its course. NASA's DART mission involved sending a spacecraft out to collide with an asteroid to nudge it into a different orbit. That's what our strategic initiatives do. They’re intentional actions that companies take to nudge a key driver in a different direction or change its speed or acceleration. Only the finance team can provide the tools to illuminate how big a nudge it’ll take to achieve a certain result or to break down the effort into the lead measures that’ll produce the desired lag measure. Talking about which department, which account, or in which period of variance the budget occurred won’t help the company achieve its strategy. --- [5 CFO trends 2024 | Finance AllianceThe future is never certain. Yet, as Chief Financial Officers (CFOs), anticipating the future is an essential part of the job. So, what should be on your radar for 2024? 🤔 Below, we explore some of the biggest CFO trends of 2024 that look ready to reshape finance priorities and functions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/cfo-trends-2024.jpg)](https://www.financealliance.io/cfo-trends-2024/) --- ## Applying driver-based forecasting to a real-world example Imagine that you start your own strategic consulting company and you're desperate for your first client. Finally, you get to lean on a small company with an ambitious leader who hopes to quadruple revenue next year. The leader in this case is your 10-year-old niece, Susie, and the business is her lemonade stand. Well, you have to start somewhere. Let’s first identify the revenue drivers. ### Revenue drivers Revenue can always first be broken down by price and quantity. Susie gets to set the price on her lemonade stand, and we just have to keep an eye on the elasticity of demand and see if changing the price causes us to lose customers. Let's talk about quantity drivers, and think about which of them we could try to nudge with a strategic initiative, and which we might need to keep an eye on from a risk management perspective: - **Passers-by per hour** \- we can’t control how busy the street corner is, but we may need to track how it's trending and plan corrective actions or responses. - **Hours open per day** \- we can control this, but additional hours could be less productive. - **Days open per week** \- we could have an initiative to change this. - **Weeks open per year** \- we can control this. - **The percent that stop and consider buying** \- we need to consider all the factors that impact this driver. They include our signage, how cute Susie and her stand look, the weather and how hot it is, how busy the people are, etc. We don't control all of these factors, but we can certainly control signage and staff. - **The percent of those that buy** \-this may be impacted by Susie’s sales skills, whether she can make change for a 20, whether Susie takes Apple Pay or Venmo, or if her price is too high, etc. We start by building our driver-based forecast with the actual results of last year, broken down by driver. Susie tells us that she gets on average 80 passers-by per hour. She's open from 10 am to 2 pm, which is four hours per day. She's open every Saturday except Christmas and New Year, so that's one day a week and 50 weeks a year. This year, Susie had one out of every four passers-by stop and consider buying a cup, and she converted 90% of those to customers. So doing the math in our driver-based forecast model, we get 3,600 cups sold at $1.25 per cup for a total of $4,500 in revenue. But remember, Susie has hired you to quadruple revenue. What will you advise her? What are the levers she can pull? What strategic initiatives could we implement for her lemonade stand to grow revenue? ### Strategic initiatives On the price side, we can suggest she raise the price from $1.25 to $1.50\. With respect to the quantity drivers, we consider trying to impact the number of passers-by per hour but decide we aren't willing to change the street corner and there isn't much else we can do. But Susie could increase the hours per day from four to six. She's going to be open from 9 am to 3 pm. She can also add Sundays and update her sign to say, ‘open every weekend.’ She should stick to 50 hours per year because 10-year-olds need their winter break. We recommend improving signs and messaging, and she can place some signs down the street. She was converting 90% of buyers so there isn't much to do there, but our price increase may cause her to lose some here so we'll watch our elasticity of demand. Now, let's update our driver-based forecast for next year and see if our strategic plan would lead to the result we're looking for. ![Applying driver-based forecasting to a real-world example - revenue drivers for year 1 and year 2](https://lh7-us.googleusercontent.com/z5SdBwhYpBsZdzu2eoJfH7vVI9Y0cEnw1aaPg7dCfqN_AHkLADW9Y_C24qxljvhqXEZrp3PPk_LX1oVMij9g9n7mNeNPA9f0B2tSzfi0S1gxpXPPgPVW7pljQDsHhmrnG64f7WfhpBwvH5WLrjVGT-0) Our price is up, passers-by per hour is flat, hours open per day is up from four to six, days open per week is up from one to two, and weeks open per year is flat. We expect our signs and improved outreach to increase the percentage that stop and consider buying from 25% to 30%, and we expect to lose a little on the percentage that buy after stopping from 90% to 85%, due to our price increase. So our driver-based forecast for next year will give us 12,240 cups sold at $1.50\. And if we execute on these initiatives, we’ll achieve our goal to quadruple revenue to $18,360\. We've clearly broken down our strategic objective so we can see the ‘how.’ Now, as the year unfolds, what do we want to keep an eye on? We know we can control our hours per day and the days per week, but we don't have experience with the nine o'clock hour or the two o'clock hour, and we don't have experience on Sundays. Maybe the passers-by per hour will be lower on average. Maybe our improved signs won't be enough to get 30% to stop and consider. Maybe we won't convert 85%. We know we have initiatives to act on the lead indicators, but we'll need to adapt as the year goes on and we'll need to be able to measure these lead indicators throughout the year. If the passers-by per hour falls, we'll need some countermeasures. To get the desired result, we may need a new initiative to get a higher percentage to stop and maybe more signs. But what if we already exhausted our sign budget? In many companies, the budget could limit our response. Marketing doesn't want to be over budget, even though sales are behind in the revenue quota. But here, the driver-based forecast is our primary financial tool for running the business. We can be agile and we can talk about what to do given what's happening with our drivers. --- [How to tell a compelling story with financial dataData visualization storytelling is not just about presenting financial data – it’s about crafting a compelling narrative that resonates with your audience.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/financial-data-storytelling--1-.jpg)](https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/) --- ## Changing the conversations your company is having about financial results I was once leading an [FP&A transformation](https://www.financealliance.io/what-is-finance-transformation/) and met with the team and asked them to imagine they could sit up in a gallery above the management team of a more successful company as they talked about their financial results. I asked them, “How do you think their discussion would differ from your company’s?” They said that the conversation would be **forward-looking**, not focused on the past, and it would be **action-oriented**. They’d understand what was happening in the business, where it was headed, and who needed to do what to succeed. That's what a good driver-based forecast does. The conversation changes to be more forward-looking and action-oriented. We can talk about how the strategic initiatives have done. What’s the latest outlook for our drivers? How has our forecast changed? What corrective actions are possible? And importantly, can we do more? Now, let's talk about how we change the conversation when revenue unexpectedly starts to drop. It often leads to layoffs. ### Top mistakes companies make with layoffs #### Reacting too late The first thing they notice is that the Year to Date budget is behind plan. But most companies don't have a good measure of the drivers that were going to get us to plan in the first place, so they ask the Head of Sales whether they think they can make it up by the end of the year. “I think so,” they may say. Since the plan was based on hope and they still have hope, they may think they can still hit plan, but it often takes another quarter to realize that they won't. #### Reacting to the decline in revenue with an equivalent decline in expenses The conversation usually goes, “Revenues are going to be down 20%, so we need to cut expenses by 20%. Payroll is 70% of our cost and an even higher percentage of the cost we can control quickly, so we'll need to cut heads by 30%.” This brings us to the next mistake: #### Not remembering the role people play in driving revenue and adding value The reason any of us are hired is because there’s a job to be done that contributes to the company's delivery to customers, directly or indirectly, or to the creation of new value. So across the board, cuts impact revenue drivers in chaotic and unknown ways that sometimes lead to a death spiral because they cause a further drop in revenue that’s followed by a further cut in heads. #### Not diagnosing the cause of the decrease in revenue Think about how the driver-based forecast we did for Susie's lemonade stand changes the conversation about a revenue drop. We’d ask, “Are there fewer people passing by? On which day? At which hours? Or is it because nobody’s stopping to consider buying? Or is there some reason the percentage of people buying has fallen substantially?” These questions help us create a new plan for success over our five-year forecast horizon. #### Focusing on the fiscal year and still trying to get back to plan If something unexpected has happened to fundamentally shake revenue, we need to adjust our strategy and our long-term plan. Whatever we do to try to fix the current year is probably at odds with what's most important for the business. For example, one company I was at put lots of effort and activity into pulling revenue from January and February into November and December. Good for the current year, but not so good for the next, and it does nothing to address the fundamental revenue issue. Sometimes the situation calls for headcount reductions, but I feel a lot better about it when we've understood what's happening and the layoff is part of a new plan for success. In my experience, a good five-year driver-based rolling forecast not only helps to navigate a crisis better and enable more effective layoffs, but also prevents layoffs in the first place. This is because I can see past the end of the year, I'm monitoring lead indicators, my risk management plan is based on the drivers I can't control, and I can be more agile in reacting to a change in one driver. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### FP&A automation: Trade manual work for strategic impact URL: https://www.financealliance.io/fp-a-automation/ Last updated: 2025-10-10T08:28:44.000Z FP&A teams know the problem all too well: routine tasks pile up, dominating your days, while those high-value, strategic projects get stuck waiting on the back burner. [Month-end reporting](https://www.financealliance.io/month-end-close-checklist/), budget updates, forecast modeling - it's all essential work, but it’s also *extremely* time-consuming. Before you know it, another week has passed without making much (*if any*) headway on the initiatives that really matter. The solution? FP&A automation. More and more FP&A teams are using artificial intelligence and cloud platforms to systematize those repetitive, manual processes. And who can blame them? By implementing new FP&A automation software, they can slash the hours spent on mundane work and free up time for more impactful analysis. If you’re ready to step off the reporting treadmill and focus on projects that drive valuable insights and strategy, then it’s time to embrace automation in FP&A. In this blog, we’ll explore: ✅ [What FP&A automation is](https://www.financealliance.io/p/725313ed-e84c-4eb5-93f0-9dc52d304fa5/#what-is-fpa-automation) ✅ [Why FP&A teams should embrace automation](https://www.financealliance.io/p/725313ed-e84c-4eb5-93f0-9dc52d304fa5/#why-every-fpa-team-needs-to-embrace-automation) ✅ [Areas of FP&A that can be automated](https://www.financealliance.io/p/725313ed-e84c-4eb5-93f0-9dc52d304fa5/#what-areas-of-fpa-can-be-automated) ✅ [Tips for getting started](https://www.financealliance.io/p/725313ed-e84c-4eb5-93f0-9dc52d304fa5/#getting-started) ✅ [What the future of FP&A automation looks like](https://www.financealliance.io/p/725313ed-e84c-4eb5-93f0-9dc52d304fa5/#the-future-of-fpa-automation) ## **What is FP&A automation?** Simply put, FP&A automation means leveraging technology to streamline the repetitive, manual processes that bog down finance teams. We're talking about all the [Excel spreadsheet](https://www.financealliance.io/chatgpt-for-excel/) wrangling, data entry, and report formatting that bloats your days, but adds little value. By implementing the latest automation software and tools, you can systematize those recurring FP&A tasks around budgeting, forecasting, and reporting. This involves establishing standardized models, workflows, and analytics to handle mundane and repetitive tasks automatically. --- [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/tools-pic-2.jpeg)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) --- ## **Why every FP&A team needs to embrace automation** In the past, FP&A teams often found themselves caught up in manual, time-consuming tasks. Collecting data, updating spreadsheets, and generating reports took up *a lot* of their time, leaving little room for the kind of deep analysis and strategic thinking that can truly drive a business forward. With FP&A automation, this scenario shifts dramatically, allowing finance pros to focus on what they do best: analyzing data, uncovering insights, and advising on strategic decisions. When you think of automating FP&A processes, think: ➡️ Freed-up resources previously bogged down in spreadsheets. ➡️ Accelerated processes measured in minutes not days/weeks. ➡️ Reduced errors and accounting misstatements. ➡️ Continuous planning and forecasting cycles. Automating mundane and redundant tasks in FP&A allows for continuous, [agile processes](https://www.financealliance.io/unleashing-the-power-of-agile-methodologies-for-fp-a/) that keep pace with today's fast-moving marketplace. Rather than being reactive, FP&A professionals become proactive partners, able to prescribe data-driven decisions that drive growth and competitive advantage. --- [FP&A for startups: The role of FP&A in business growthIn this article, we explore how FP&A can help grow startups and provide vital support in making smart financial decisions during the early stages of growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/FP-A-startup.jpg)](https://www.financealliance.io/fp-a-for-startups/) --- ## **What areas of FP&A can be automated?** ![FP&A automation](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/01/FP-A-automation.png) FP&A automation can revolutionize several key areas within the finance function. Let's delve into some of them: ### **Data collection & integration** One of the most time-consuming tasks in FP&A is gathering financial and operational data from various sources. Automation can streamline this process by [integrating data](https://www.financealliance.io/data-cleaning-techniques/) from different systems, such as ERP, CRM, and HR software. This ensures that all relevant data is collected efficiently and consistently, providing a comprehensive view of the organization's financial health. ### **Financial reporting** Generating financial reports is a staple of FP&A, but it's also repetitive and prone to errors when done manually. Specialised [FP&A tools and software](https://www.financealliance.io/15-best-fp-a-tools-and-software/) can produce these reports quickly and accurately, ensuring that stakeholders have timely access to critical financial information. This includes standard reports like: - Income statements - Balance sheets - Cash flow statements - Customized reports tailored to the specific needs of the company ### **Budgeting & forecasting** Automating the budgeting and forecasting process can save a huge amount of time *and* improve accuracy. The best tools can handle complex calculations, [scenario analysis](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/), and what-if modeling, providing FP&A teams with better insights to forecast future performance and plan accordingly. ### **Dashboarding & visualization** Presenting financial data in an easily digestible format is essential for decision-making. By automating these processes, you can easily create dynamic dashboards and visualizations that provide real-time insights into key [financial metrics](https://www.financealliance.io/infographic-financial-performance-metrics/), helping executives and other stakeholders to quickly grasp the financial status and trends. ### **Scenario planning** The ability to analyze different financial scenarios is vital for strategic planning. Automation can facilitate this by quickly modeling various scenarios based on different assumptions, helping organizations prepare for potential future developments. --- [How to use data visualization storytelling to transform FP&AWant to learn how to tell compelling stories with data? Discover techniques to improve your data visualization storytelling skills right here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2022/09/data-visualization-storytelling-2.jpg)](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) --- ## **Getting started** If you want to introduce FP&A automation, there are a few steps to help lay the groundwork: ### 📝 **Evaluate as-is workflows** Which processes soak up the most resources for marginal value? Target those first. ### ✅ **Get stakeholder buy-in** Educate colleagues on automation goals and collaborate on priorities. ### 📈 **Start small, deliver a quick win** Prove out benefits before expanding automation. ### 🔎 **Vet software vendors** Align offerings' strengths and costs to key needs around forecasting, reporting, etc. ## **The future of FP&A automation** Recent research has revealed that [92% of finance leaders](https://www.prophix.com/cfosurvey/?utm%5Fcampaign=GL%5FPROS%5FFY23%5FWP%5FGlobal-Survey-Report&utm%5Fmedium=press%5Frelease&utm%5Fsource=press) are already or planning to automate at least half of their processes within the year. But what does the future hold for FP&A automation? Leading analysts [forecast automation](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) adoption to soar over the next few years as solutions become more capable and accessible. Here are just a few of their predictions: - 👆🏻 **Surging investment**: FP&A teams will earmark more budget for automation tools. - 📅 **Continuous planning**: Real-time performance tracking supplants static cycles. - 🔮 **Improved insights**: [Machine learning](https://www.financealliance.io/fpa-machine-learning/) excavates valuable intelligence from data. - 📊 **Better decisions**: Timely analytics and models feed strategic choices. Rather than getting stuck manually moving data and producing reports, FP&A will pivot to continuous forecasting, predictive analytics, and prescriptive guidance - the keys to finance leading business growth. --- ## **FAQs** ### **Can you automate financial analysis?** Absolutely! A lot of the number crunching and report generating in financial analysis can be automated. Think of software doing the heavy lifting of sorting through data, doing calculations, and spitting out reports. This leaves the analysts free to dig into the why's and what-ifs, which is the really fun part. ### **Will FP&A be automated?** Yep, it's already happening! A bunch of the routine stuff in FP&A, like pulling data together and making basic forecasts, is moving over to automation. It's not about replacing people, but more about giving them time to tackle the [big-picture strategy](https://www.financealliance.io/10-big-picture-financial-planning-steps/) things that robots can't do. ### **What is FP&A technology?** FP&A technology is basically a collection of tools and software that help with financial planning and analysis. It's all about making life easier for finance teams, with advanced features for pulling data from different places, making it look pretty in charts, and helping predict future trends. --- ### Download our Finance Tools of Choice Report! Our ultimate directory of finance tools is here, bringing you the best tools and software of 2023 that finance pros swear by. We've gathered insights from industry leaders to spotlight the tools finance professionals can’t do without. These aren't just any tools; they've been vetted, tested, and proven effective. Download the report to find out what tools made the list.👇 [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/10/FA_Tools_of_Choice_2023_CTA_Banner.png) ](https://www.financealliance.io/finance-alliance-tools-of-choice/) ### The top 5 CFO trends of 2024 URL: https://www.financealliance.io/cfo-trends-2024/ Last updated: 2024-09-27T09:34:04.000Z The future is never certain. Yet, as Chief Financial Officers (CFOs), anticipating the future is an essential part of the job. So, what should be on *your* radar for 2024? 🤔 Below, we explore some of the biggest CFO trends you can expect to see over the next 12 months. --- ## **1\. Embracing finance transformation and AI** The digital revolution in finance is here, and it's powered by Artificial Intelligence (AI). [KPMG](https://kpmg.com/kpmg-us/content/dam/kpmg/pdf/2023/tax-reimagined-2023.pdf) reports a whopping 59% of C-Suite leaders are using AI in their finance departments, signaling a seismic shift towards [digital transformation](https://www.financealliance.io/how-finance-digital-transformation-impact-company/). But why is this CFO trend so pivotal? [AI and automation](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) are reshaping finance, from streamlining transaction processing to enhancing forecasting with machine learning. It's not just about efficiency; it's about unlocking strategic decision-making and transforming the very nature of finance functions. CFOs are diving deep into AI, leveraging predictive analytics and intelligent automation, driving quicker close cycles, and freeing up staff for strategic roles. ### **Key focus areas include:** - Automating transaction processing and reporting. - Applying [machine learning](https://www.financealliance.io/the-future-of-fp-a-how-to-predict-revenues-using-machine-learning/) for enhanced forecasting and planning. - Leveraging predictive analytics to model different risk scenarios. As CFOs continue expanding their use of AI for finance activities, there are a few best practices worth emphasizing to maximize value: ### **1\. Educate and train your team** For starters, your team will only love AI as much as they understand it. Take time to develop AI literacy within your finance team to ensure they understand and can leverage these technologies effectively. When your people grasp how AI can enhance their impact, adoption skyrockets. ### **2\. Invest in the right tools** Not all tools are created equal, so invest wisely in [financial software](https://www.financealliance.io/15-best-fp-a-tools-and-software/) that can automate routine tasks, enhance data accuracy, and provide predictive analytics. ### 3\. **Prioritize data security** Never lose sight of protecting your most valuable asset – your data. State-of-the-art [data security](https://www.financealliance.io/what-is-big-data-security-analytics/) safeguards information integrity and keeps outsiders outside...where they belong! --- ## **2\. Developing ESG and sustainable financial strategies** Sustainability is no longer a buzzword - it's a financial imperative (and one of the biggest CFO trends of 2024). Nearly a [third of CFOs](https://www.pwc.com/us/en/executive-leadership-hub/cfo.html) are now evaluating how climate change scenarios could impact financial performance in 2024\. Sustainable financial strategies are at the core of corporate responsibility, and investors are taking notice. This year, you'll notice more CFOs integrating ESG considerations into financial planning, exploring green finance options, and optimizing ESG performance to drive long-term value and resilience. ### Tips for improving ESG efforts: - **Integrate ESG into financial planning:** Embed ESG factors into financial models and [risk assessments](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/). - **Collaborate with stakeholders**: Engage with investors, customers, and employees to align your ESG strategies with their expectations and values. - **Report transparently:** Ensure your ESG initiatives and their financial implications are communicated clearly in your reporting. --- [How to build custom copilots with Microsoft Copilot StudioMicrosoft’s latest technological marvel, Copilot Studio, announced at Ignite 2023, marks a revolutionary step for finance professionals.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/Copilot-image.webp)](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) --- ## **3\. Focus on profitable growth and optimizing costs** The balancing act between growth and cost-efficiency is more critical than ever. CFOs are scrutinizing budgets, evaluating growth opportunities, and focusing on the most profitable ventures. ### **Key initiatives include:** - Reviewing portfolio of products and services to identify and double down on the most profitable. - Scrutinizing budgets and identifying areas of cost savings through process efficiency. - Carefully evaluating growth opportunities against potential ROI. By focusing on profitable growth and cost levers, CFOs can guide their organizations toward peak performance despite turbulent seas. --- ## **4\. Improving financial data storytelling, a growing CFO trend** CFOs are looking to not just report the numbers, but tell stories that matter. Effective [data storytelling](https://www.financealliance.io/sensitivity-analysis-vs-scenario-analysis/) enables CFOs to convey complex financial information in a clear, engaging, and actionable manner, leading to better decision-making across the organization. The CFOs able to connect the dots between financial data and corporate priorities will have a leading edge. Here’s how you can be one of them: 1. **Develop narrative skills:** Learn to craft compelling narratives around data to highlight key insights and actions. 2. **Use visualization tools:** Use dashboards and infographics to make financial data more accessible and understandable. 3. **Train for clarity:** Educate your team on how to present data clearly to different audiences (*remember - not everyone speaks 'finance'*). --- [A CFO’s guide to economic resilience & financial resilienceWith the right financial resilience strategies, mindset shifts, and execution tactics, developing true economic resilience is possible. And that’s exactly what we’re diving into with this guide.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/ship-1366926_1280.jpg)](https://www.financealliance.io/steering-through-storms-a-cfos-guide-to-economic-resilience/) --- ## **5\. Talent retention** > “*Failing to prioritize talent management results in increased competition for qualified candidates and potential gaps in staffing.”* – William Carter Jr., M.F.A., [AICPA & CIMA](https://www.aicpa-cima.com/professional-insights/article/top-cfo-priorities-and-trends-in-2024#:~:text=Three%20of%20the%20most%20significant,informed%20choices%20for%20your%20organization.) As William Carter Jr. from AICPA & CIMA points out, neglecting talent management leads to increased competition for qualified candidates and staffing gaps. [Retaining top finance talent](https://www.financealliance.io/finance-talent/) is a rising CFO trend because it’s crucial for maintaining continuity, fostering innovation, and ensuring competitive edge. With talent competition heating up, the costs of turnover and loss of intellectual capital can significantly hurt bottom lines. As such, CFOs are thinking deeply about talent retention strategies on multiple fronts — competitive compensation, stimulating work environments, upskilling programs, career development opportunities., etc. Investing in top talent retention will likely be a key theme across the C-Suite in 2024\. Because at the end of the day, people fuel the numbers. ### **Tips to help retain top finance talent:** 1. **Invest in professional development:** Offer continuous learning opportunities to keep your team engaged and up-to-date with the latest financial trends and technologies. 2. **Foster a positive work culture:** Create an inclusive and supportive work environment that values employee contributions. 3. **Offer competitive benefits:** Ensure your compensation and benefits packages are competitive to attract and retain top talent. --- ## Finance Alliance Pro Membership Tired of feeling stagnant in your FP&A career? Take control and unlock your true potential with the **Finance Alliance Pro Membership.** This exclusive community is your secret weapon, connecting you with elite finance professionals and equipping you with the cutting-edge tools and resources you need to dominate the field. **Fuel your growth:** - **Engage in high-level discussions** with peers, sparking innovative ideas and expanding your perspective. - **Sharpen your skills** with access to advanced financial analysis tools and expert-curated resources. ️ - **Unlock exclusive career opportunities** within a network of **industry leaders.** **Don't just survive your career, *thrive* in it.** **Join Finance Alliance Pro Membership today!** 🎓 [Sign Up](https://www.financealliance.io/pro-membership/) ### Building financial resilience: 12 proven strategies for managing liquidity URL: https://www.financealliance.io/12-proven-strategies-for-managing-liquidity/ Last updated: 2025-04-10T07:50:46.000Z Managing liquidity is key to giving your company the financial freedom to grab opportunities and handle uncertainties. As a finance pro, you know that cash and liquidity management isn’t just about keeping your business afloat; it's about strategically positioning yourself to: - Swiftly meet short-term obligations and seize growth opportunities. - Break free from the costly grip of emergency financing. - Optimize excess cash through safe investments. - Identify and resolve customer payment issues *early.* - Maintain flexibility to handle unforeseen events. … and so much more. In other words, it provides flexibility - and that flexibility is *key* to navigating the inevitable ups and downs of business. **Read on to learn more about:** - [What liquidity management is](https://www.financealliance.io/p/2872c599-f50e-4340-a1a5-4df9808537e5/#what-is-liquidity-management) - [The importance of managing liquidity](https://www.financealliance.io/p/2872c599-f50e-4340-a1a5-4df9808537e5/#why-is-it-important-for-a-business-to-manage-liquidity) - [The role of a CFO in liquidity management](https://www.financealliance.io/p/2872c599-f50e-4340-a1a5-4df9808537e5/#the-cfo%E2%80%99s-role-in-managing-liquidity) - [The difference between liquidity management vs working capital](https://www.financealliance.io/p/2872c599-f50e-4340-a1a5-4df9808537e5/#what%E2%80%99s-the-difference-between-liquidity-and-working-capital) - [Liquidity management strategies](https://www.financealliance.io/p/2872c599-f50e-4340-a1a5-4df9808537e5/#12-liquidity-management-strategies) --- ## **What is liquidity management?** Liquidity management is about ensuring your company always has enough cash, not just for the daily grind but also for tempting growth opportunities. Managing liquidity is a balancing act that involves: - **Predicting future cash flows** to avoid surprises - Setting aside money for **unexpected needs** - Securingaccess to **loans or credit lines** for flexibility Think you can just wing it, assuming the cash will be there for vendor payments, employee salaries, or new inventory? Think again. Without savvy forecasting, a rainy-day fund, and a handy credit line, you might be blindsided by an unexpected financial pothole. Good liquidity management means being *prepared* and not just hoping the funds will be there when needed. It's a proactive (*and essential*) approach to handling finances. --- [What is a CFO’s role in investor communications?A CFO’s involvement in investor communications is crucial for narrating a company’s financial story. As the top financial executive, you understand the past, present, and future of the organization better than anyone.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/pawel-czerwinski--0xCCPIbl3M-unsplash.jpg)](https://www.financealliance.io/cfos-role-in-investor-communications/) --- ## **Why is it important for a business to manage liquidity?** Without sufficient cash and other fluid capital, businesses can't make payroll, support critical investments, or simply pay the bills to keep the lights on. But if you're sitting on a cash cushion, you're ready to ride out any storm. [Economic downturn](https://www.financealliance.io/steering-through-storms-a-cfos-guide-to-economic-resilience/)? Bring it on. Sudden crash crunch? Handled like a boss. A golden opportunity for growth? You’re ready to seize it with both hands! ****Bottom line:** Managing liquidity equips your company with endurance and adaptability. It's all about being ready for curveballs, and ensuring your business stays resilient. ## **The CFO’s role in managing liquidity** The CFO's role in cash and liquidity management is vital. If you’re the CFO, it’s on *you* to assess danger zones early AND take risks to find new opportunities. This means: - Forecasting cash flows and ensuring your company can handle its financial commitments. - Juggling assets to strike that perfect balance between [risk and return](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/). - Playing the credit management game to keep the cash flowing. - Being nimble and adjusting [financial strategies](https://www.financealliance.io/5-cost-reduction-strategies/) as the market fluctuates. - Implementing risk management strategies to dodge financial landmines. - Staying on the straight and narrow with regulatory compliance and financial reporting. - Managing working capital to ensure your company's financial engine runs smoothly. - Teaming up with other departments to align financial goals with the broader business strategy. --- [A CFO’s guide to economic resilience & financial resilienceWith the right financial resilience strategies, mindset shifts, and execution tactics, developing true economic resilience is possible. And that’s exactly what we’re diving into with this guide.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/ship-1366926_1280.jpg)](https://www.financealliance.io/steering-through-storms-a-cfos-guide-to-economic-resilience/) --- ## **What’s the difference between liquidity and working capital?** Liquidity management and working capital are related but distinct concepts in [financial management](https://www.financealliance.io/7-data-management-problems-and-solutions/). ### **Liquidity** Liquidity refers to how quickly (and easily) a company can convert its assets into cash to meet its short-term obligations. It's a measure of the company's ability to pay off its short-term liabilities *without* raising external capital. ****High liquidity** \= Can cover short-term debts without any issues. ****Low liquidity** \= Might need to rethink and reassess finances. Common measures of liquidity include the **current ratio** (current assets divided by current liabilities) and the **quick ratio** (cash, marketable securities, and accounts receivable divided by current liabilities). ### **Working capital** Working capital is the difference between a company's current assets and current liabilities. In other words, it's the capital you have to keep daily operations running. Working capital measures the budget available **after* current liabilities. It's calculated by ****subtracting current liabilities** from ****current assets**. Positive working capital? You're in the clear, with more short-term assets than liabilities. Negative working capital, though, could mean liquidity headaches on the horizon. --- [Financial month-end close checklist | Finance AllianceWhether you’re a seasoned finance pro or just starting, we’re here to guide you through the process. We’ve got some handy checklists, nifty tips, and a few tricks up our sleeve to transform your month-end close from a frantic scramble into a streamlined process.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/month-end-close.jpg)](https://www.financealliance.io/month-end-close-checklist/) --- ## **12 Liquidity management strategies** Managing liquidity is essential for maintaining the financial health and operational stability of your business. But where should you even begin? Below are 12 strategies to help with corporate liquidity management: ### **1\. Establish cash reserves** Create a financial buffer by setting aside funds for unexpected situations. This ensures you have the liquidity to cushion against unforeseen expenses or revenue shortfalls. ### **2\. Utilize credit lines wisely** Maintain access to credit facilities for added financial flexibility. Use these lines of credit judiciously to manage short-term liquidity needs *without* overextending your company's debt. ### **3\. Balanced investment strategies** Align your investment decisions with your liquidity requirements. One of the best ways to do this is to choose the right mix of liquid assets and longer-term investments to optimize returns while maintaining cash availability. ### **4\. Accelerate receivables** Implement policies that encourage early payments, such as offering discounts for prompt payments, and make sure to follow up on overdue accounts. ### **5\. Extend payables** Negotiate longer payment terms with suppliers without compromising relationships or incurring late fees. Focus on leveraging payment terms effectively to maintain a [healthy cash flow](https://www.financealliance.io/cash-flow-drivers-in-a-business/). ### **6\. Consider purchasing liquidity** Think about acquiring liquidity through external sources like short-term loans or lines of credit. This can provide immediate cash flow when needed, but it's crucial to weigh the costs and benefits carefully. ### **7\. Centralize all financial data** An effective technique for managing liquidity is centralizing all financial data. If you want to enjoy easier tracking, analysis, and decision-making, ensuring you have a comprehensive view of your company's financial health is the way to go. --- [6 zero-based budgeting myths debunkedA zero-based budget (ZBB) is a budgeting method where you allocate every dollar earned to a specific category or expense. You start with a blank slate - zero - each time you budget, rather than tweaking your past budget.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/zero-based-budgeting-2.jpg)](https://www.financealliance.io/6-zero-based-budgeting-myths-debunked/) --- ### **8\. Manage liabilities** Keep a close eye on your liabilities and strategically manage them. This includes negotiating favorable terms, refinancing debts at lower interest rates, and planning for timely repayments to maintain a healthy balance sheet. ### **9\. Predict future cash positions** Regularly analyze and estimate your future cash positions. Use [forecasting tools](https://www.financealliance.io/15-best-fp-a-tools-and-software/) and models to predict cash inflows and outflows, helping you plan and avoid liquidity crunches. ### **10\. Diversify funding sources** Don't rely on a single source of funding. Diversify your funding sources to reduce dependence on any one option. This can include a mix of internal funds, bank loans, investor capital, and other financing options. ### **11\. Minimize expenses** Managing liquidity effectively involves looking for ways to reduce costs *without* compromising on quality or efficiency. This can include renegotiating supplier contracts, cutting unnecessary expenditures, or implementing cost-effective operational practices. ### **12\. Review financial statements often** Frequently review your financial statements to stay informed about your company's financial performance and position. This regular scrutiny enables you to spot trends, address issues early, and make informed strategic decisions. --- ### FAQs: Liquidity management What is global liquidity and cash management? Global liquidity and cash management refers to overseeing and optimizing cash resources across different countries and currencies in a multinational company, ensuring efficient global cash flow and liquidity. How do you maintain cash liquidity? Maintaining cash liquidity involves managing cash flows, maintaining emergency reserves, optimizing working capital, and ensuring access to credit lines or other financing options. What is the difference between liquidity management and cash flow management? Liquidity management focuses on maintaining sufficient cash to meet short-term obligations, while cash flow management involves the inflows and outflows of cash, emphasizing the timing and amount of cash moving through the business. What is the liquidity of cash? Cash is the most liquid asset, as it can be immediately used to pay for goods, services, or obligations without conversion or delay. How is liquidity management done? Liquidity management is done by forecasting cash flows, managing working capital, maintaining access to credit facilities, and regularly reviewing financial positions. What are the benefits of liquidity management? Benefits of managing liquidity include improved financial stability, reduced risk of insolvency, enhanced ability to seize growth opportunities, and better financial planning and forecasting. What is the key objective of liquidity management? The key objective is to ensure the company has enough liquid resources to meet its short-term financial obligations while maintaining operational efficiency and growth potential. What is a liquidity management strategy? A liquidity management strategy is a plan that outlines how a company will manage its liquid assets and liabilities to maintain financial stability and support business operations. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/10/FA_Tools_of_Choice_2023_CTA_Banner.png) ](https://www.financealliance.io/finance-alliance-tools-of-choice/) ### "Joining has helped me to keep my finger on the pulse of the latest thought leadership in finance." - Megan Walbyoff URL: https://www.financealliance.io/case-study-megan-walbyoff/ Last updated: 2024-01-16T08:44:47.000Z The finance world moves *fast*. Professionals need spaces to connect, network, and advance together - which is where the Finance Alliance community leads the way! Our diverse membership, ranging from industry novices to seasoned experts, ensures a rich library of knowledge and experiences, making the community ideal for anyone looking to grow in their finance career. Below, we hear from [Megan Walbyoff](https://www.linkedin.com/in/megan-walbyoff-33668622/), Commercial Finance Director at Luno (a Cryptocurrency wallet/exchange owned by Digital Currency Group and operating in over 40 countries). In her role, Megan is responsible for FP&A, [Finance Business Partnering](https://www.financealliance.io/finance-business-partnering-playbook-2/), revenue forecasting, and commercial analysis. With over 13 years of post-qualification experience, including eight years with PwC in audit, Megan has tackled a wide array of technical challenges and transactions across multiple industries. Megan wanted to expand her network, which was the main reason she joined the [Finance Alliance Slack community](https://www.financealliance.io/community/). After being a member for quite a while, we decided to catch up with Megan to hear about her experience. ### What have you enjoyed most since joining? Finance Alliance offers a massive range of resources for all community members. From webinars featuring some of the biggest names in finance to educational articles, virtual and in-person events, reports, playbooks, and so much more. We wanted to know what Megan has enjoyed the most since becoming a member. She highlighted our selection of [articles](https://www.financealliance.io/articles/) (updated each week) covering topics such as FP&A, career development, finance transformation and more. > *"The fresh content and resources channels on Slack have been great. I regularly read the articles shared and often take these back to my team as we hold discussions about the latest thinking related to FP&A."* ### What type of discussions have you found the most insightful and useful? Finance Alliance thrives on a diverse array of discussions, offering insights into various facets of the finance world. However, Megan prefers to engage with content and likes to keep up with conversations - but that side of the community isn't her top priority (and that's okay!). > *"I have been less active with the discussions, and more focused on the articles. But I keep an eye on discussions around things like systems."* ### 4\. What type of resources have you found the most helpful? The Finance Alliance community is renowned for its diverse and extensive resources, catering to the varied interests and needs of its members. Among these, our recent focus on [artificial intelligence (AI) in finance](https://www.financealliance.io/ai-in-finance-ebook-download/) has garnered significant attention and appreciation. Members like Megan find these AI-centric resources particularly beneficial, as they offer cutting-edge insights and practical applications of AI in the finance sector: > *"The resources I've found most helpful are those related to AI, and those about some of the challenges facing FP&A (which I share with my team)."* Our content on AI includes in-depth articles, expert-led webinars, and interactive discussions that explore how AI is transforming financial planning and analysis, risk management, and decision-making processes. Here are just a few that our community members have enjoyed recently: [How to leverage AI in finance with Christian MartinezIt’s really important to have that buy-in from management. In order to get it, you need to understand the ‘why are we doing this,’ and ‘why this matters.’ The answers will depend on the management and the project, but understanding those is key.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/09/processor-2217771_1280.jpg)](https://www.financealliance.io/ama-with-christian-martinez-ai-in-finance/) [How to build custom copilots with Microsoft Copilot StudioMicrosoft’s latest technological marvel, Copilot Studio, announced at Ignite 2023, marks a revolutionary step for finance professionals.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/Copilot-image.webp)](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) [Exploring the transformative power of AI in financeIn today’s digitally driven world, finance businesses are dealing with the challenges of managing enormous data sets whilst also having to meet increasing demands for more efficient services.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/pexels-tara-winstead-8386440--1-.jpg)](https://www.financealliance.io/exploring-the-transformative-power-of-ai-in-finance/) ### ### How has the community impacted your professional growth? Professional growth is a hallmark of the Finance Alliance experience and we're dedicated to supporting our members in their career development every step of the way. Our community offers a comprehensive platform where finance professionals can enhance their skills, gain new insights, and connect with industry experts and peers. Through a variety of initiatives such as career advice, and access to exclusive industry reports and case studies, we empower our members to achieve their professional objectives. Megan reflects on her journey within the community, emphasizing how the diverse range of discussions, resources, and networking opportunities has helped her stay on top of industry trends, gain confidence in her role, and expand her professional network: > *"It has been helpful for me to get an insight into who is out there and the types of questions people ask. I have grown in confidence.* Joining has helped me to keep my finger on the pulse of the latest thought leadership in finance.*"* ### Can you share a specific instance where the community helped you overcome a professional challenge? Members often find the community a supportive space for overcoming challenges. Megan recounts a significant experience: > *"Through Finance Alliance, I took part in a panel discussion as part if the FP&A Forum. This was something I had wanted to do for a while but I was unsure about whether I had sufficient expertise. Off the back of this, I posted about my experience on LinkedIn and my Company also reposted this."* ### In what ways have you contributed to the community, and what was the outcome? Contributing to the community can lead to rewarding experiences, as Megan discovered: > *"Talking at the FP&A forum – the outcome was that people got in touch after the fact to say they were interested in learning more."* ### How do you see the value of this community in comparison to other professional networks you're part of? Comparing Finance Alliance to other networks highlights its unique strengths. Megan explains: > *"The Finance Alliance community is welcoming and encourages people to get involved. It’s a readily available network of individuals with a range of knowledge and experience, making it a great place to go to for advice on arising topics.* > *"It's proactive in sharing articles and driving discussions, which is also good for developing yourself professionally."* ### Why should other finance professionals join the community? Encouraging others to join, Megan highlights the many benefits: > *"There are multiple benefits from the community, including the opportunity to tap into a network of like minded professionals and to access information and thought leadership. You get out of it what you put in."* --- ### Join the Finance Alliance Community Sign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders. Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. So, what are you waiting for? Sign up today! [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### How to tell a compelling story with financial data URL: https://www.financealliance.io/how-to-tell-a-compelling-story-with-financial-data/ Last updated: 2025-10-10T08:24:03.000Z ## **7 steps to craft an engaging narrative with financial data** **Data visualization storytelling is not just about presenting financial data – it’s about crafting a compelling narrative that resonates with your audience.** Here are seven steps to help do just that: ### Step 1 – Identify your audience Tailor your story to the needs and preferences of your stakeholders, whether they are senior executives, peers, or non-finance professionals. Understand *who* you’re presenting to and what information is important to them. This will help you **tailor your story** to their needs and make your data more relevant and engaging. ### Step 2 – Define your goal What do you want to achieve with your story? Whether it’s driving a decision, showcasing a trend, or highlighting a risk, your goal should **guide your narrative**. ### Step 3 – Identify the key message Identify the main point of your story and use it to guide your narrative. This should be a **clear and concise statement** that summarizes the key insights from your financial data. ### Step 4 – Choose your data wisely Select the most **relevant data** to support your story. Avoid overwhelming your audience with too much information or unrelated data points. This means selecting relevant, accurate, and easy-to-understand data. Use financial data visualization techniques such as [charts, graphs, and dashboards](https://www.financealliance.io/financial-charts-and-graphs/) to help make your data more visually appealing and easier to interpret. ### Step 5 – Craft a compelling storyline Craft a storyline that engages your audience and leads them on a journey. Use a narrative structure that includes a beginning, middle, and end, and use storytelling techniques such as analogies, metaphors, and examples to make your story more relatable and compelling. ### Step 6 – Use real-world examples Use real-world examples and case studies to show how your financial data has real-world implications and how it can be used to drive better business outcomes. Use these examples to illustrate key points! ### Step 7 – Practice and refine Practice your storytelling skills and refine your narrative over time. Solicit feedback from colleagues and other stakeholders to help improve your storytelling and make your narrative even more compelling. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/01/Screenshot-2024-01-12-at-08.48.42.png) ## **How to structure your data visualization story for maximum impact** Structuring your data visualization story properly is crucial to ensure your audience understands your key message and takes the desired action. A well-structured story can help you connect with your audience, convey complex information, and inspire action. To structure your data story effectively, start with a clear and concise message summarizing the main point of your story. This should be the guiding principle informing the rest of your story and helping you to stay focused on your key message. Once you have your key message locked in, it’s time to think about the overall structure of your story. This means deciding on the order you’ll present the information and the types of data visualization techniques you’ll use to illustrate your points. One effective way to structure your [data visualization story](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) is to use a narrative arc that includes a beginning, middle, and end: **1.** **The beginning sets the scene and introduces the key players and context.** **2.** **The middle presents key information and data that supports your message.** **3.** **The end summarizes the main points and calls to action.** Another effective way to structure your data visualization story is to use a pyramid structure, where you start with the most important and impactful information at the top and work your way down to the supporting details. To structure a powerful data visualization story, follow these five steps: 1\. Setting the stage 2\. Presenting the problem 3\. Showcasing the data 4\. Highlighting key insights 5\. Offering a conclusion or recommendation --- [How to use data visualization storytelling to transform FP&AWant to learn how to tell compelling stories with data? Discover techniques to improve your data visualization storytelling skills right here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2022/09/data-visualization-storytelling-2.jpg)](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) --- ### Bonus tips on using financial data to create a compelling story/narrative **1\. Use relatable examples** Connect your data to real-world situations or familiar concepts to help your audience understand its significance. **2\. Focus on the human element** Whenever possible, emphasize how your data impacts people – whether it’s customers, employees, or stakeholders. **3\. Create an emotional connection** Engage your audience’s emotions by highlighting the potential consequences or benefits of the insights derived from your data. ## **How to build a persuasive argument** When presenting a data story to an audience, such as the CEO and other stakeholders, it’s essential to be prepared for some backlash. This is because financial data can be complex and difficult to understand, and stakeholders may have various interpretations of the data or different priorities and goals. Resist the urge to jump on the defense. Instead, learn to build a persuasive argument with your [financial data storytelling](https://www.financealliance.io/storytelling-with-data-visualization-playbook/). This means presenting data clearly and concisely and fine-tuning the story so it’s relevant to the audience’s needs and interests. It also means being able to anticipate potential objections or questions and having a plan to address them. Building a persuasive argument with data storytelling requires a combination of technical expertise and communication skills. Telling a story that connects with your audience on an emotional level requires the ability to use storytelling techniques such as analogies, metaphors, and examples to make the data more relatable and engaging. Ultimately, building a persuasive argument with data storytelling is about translating complex financial information into a clear and compelling story that drives better business outcomes. By anticipating potential objections and building a strong narrative that resonates with your audience, you can build trust, credibility, and influence, even in the face of potential backlash. --- [How color impacts your finance presentationsColor is an incredibly powerful tool in data storytelling, capable of evoking emotions, drawing attention, and communicating complex information quickly and effectively. When used right, color can help viewers differentiate between different data points and highlight key insights.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/colour-in-finance.jpg)](https://www.financealliance.io/how-color-impacts-your-finance-presentations/) --- ## 4 tips to create a persuasive argument with financial data ### 1\. Use data to support your claims Present concrete evidence that reinforces your argument and establishes your credibility. ### 2\. Address potential counterarguments Anticipate objections or alternative interpretations of the data and address them in your visualizations. ### 3\. Keep it simple and focused Avoid presenting too many data points or arguments at once, as this can dilute your message and confuse your audience. ### 4\. Make a clear call to action Guide your audience toward the desired outcome by offering a clear, actionable recommendation based on data-driven insights. --- ## Presentation skills Even the most compelling financial data story can fall flat without effective presentation skills. Here are some tips to help you shine during your presentations: ### 1\. Practice, practice, practice Rehearse your presentation to build confidence and ensure a smooth delivery. ### 2\. Engage your audience Involve your audience by asking questions, soliciting feedback, or encouraging discussion. This will help keep them engaged and invested in your story. ### 3\. Use storytelling techniques Embrace storytelling techniques such as pacing, tone, and suspense to make your presentation more engaging and memorable. ### 4\. Prepare for questions Anticipate the questions your audience may have and be ready to address them with confidence and clarity. ### 5\. Use visuals effectively Ensure that your data visualizations are clear and concise and use them to support your narrative. Avoid cluttering your slides with too much text or unnecessary visuals. ### 6\. Be mindful of body language Maintain eye contact, stand tall, and use gestures to emphasize key points. Your body language can convey confidence and enthusiasm, which will help to create a strong connection with your audience. --- ### Storytelling with Data Visualization Playbook Are you tired of presenting financial data that falls flat? Frustrated that your insights are lost in a sea of numbers and charts? Worry no more! We've created the ultimate playbook to help you transform your financial data into captivating, persuasive stories. Discover the essential components of a powerful data narrative and learn how to weave them together to create a story that resonates with your audience. Get your copy ### ### What is a CFO's role in investor communications? URL: https://www.financealliance.io/cfos-role-in-investor-communications/ Last updated: 2025-10-23T08:59:17.000Z A CFO's involvement in investor communications is crucial for narrating a company's [financial story](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/). As the top financial executive, you understand the past, present, and future of the organization better than anyone. Leveraging your financial acumen and leadership to shape investor messaging allows you to build credibility, trust, and transparency with investors. Read on as we explore the unique role of the CFO in investor communications and best practices. **Table of contents:** - [What is investor communications?](https://www.financealliance.io/p/8a26acdd-30ef-4db2-b74f-7e0fc34d6bd4/#what-is-investor-communications) - [The importance of investor communication](https://www.financealliance.io/p/8a26acdd-30ef-4db2-b74f-7e0fc34d6bd4/#why-is-investor-communication-important) - [Investor relations in private equity](https://www.financealliance.io/p/8a26acdd-30ef-4db2-b74f-7e0fc34d6bd4/#what-is-investor-relations-in-private-equity) - [The role of a CFO in investor relations](https://www.financealliance.io/p/8a26acdd-30ef-4db2-b74f-7e0fc34d6bd4/#what-is-the-role-of-a-cfo-in-investor-relations) - [Challenges faced by CFOs in investor communications](https://www.financealliance.io/p/8a26acdd-30ef-4db2-b74f-7e0fc34d6bd4/#challenges-faced-by-cfos-in-investor-communications) - [Tips for better investor relations communications](https://www.financealliance.io/p/8a26acdd-30ef-4db2-b74f-7e0fc34d6bd4/#tips-for-better-investor-relations-communications) - [Examples of poor vs excellent investor relations](https://www.financealliance.io/p/8a26acdd-30ef-4db2-b74f-7e0fc34d6bd4/#poor-vs-excellent-investor-communications) ## **What is investor communications?** Investor communications refers to how a company communicates financial and operational information to current and potential investors in the company. As a CFO, you're tasked with not just handling the numbers, but also sharing your company's financial story clearly and engagingly. Here's what it involves: **Financial reporting** This isn't just about sharing numbers. It's about clearly showing your [company's financial health](https://www.financealliance.io/infographic-financial-performance-metrics/) through balance sheets and income statements. **Earnings calls and presentations** Imagine these as regular check-ins where you discuss how the company has performed, throw light on operational updates, and share glimpses of what lies ahead. **Annual reports** More than a document, it's a yearly recap that tells the story of your company’s activities and financial performance, offering both hindsight and foresight. **Press releases** These are timely news bulletins that keep everyone in the loop about major happenings like mergers or leadership changes. **Investor meetings and conferences** These are your face-to-face or virtual interactions where you engage directly with those who have a stake in your company's success. **Regulatory filings** Critical for compliance, these filings ensure you're keeping things transparent and above board with regulatory bodies. **Corporate governance communications** Here, you're conveying how the company is managed and governed, keeping investors informed about policies and practices. **Crisis communication** When things get rocky, this is about being upfront and guiding investors through the storm with clear and prompt communication. The ultimate aim? To ensure investors are well-informed and confident in their decisions, fostering a sense of trust and reliability. Well-executed investor communications can lead to a more positive perception and potentially a stronger financial standing in the market. --- [3 vital things to know about financial performance analysisEven if you’re experienced at it, there are a few important things about measuring a company’s financial performance that even the experts can overlook. In this blog post, we’re digging into three things every CFO should know about financial performance analysis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2022/09/finanical-performance-analysis-header-image.jpg)](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/) --- ## **Why is investor communication important?** Investor communications is important to build a solid, trust-filled relationship between a company and the people who invest in it. You’ve got to keep the investors in the loop. This involves making sure they really get what's happening with the company's finances, where it's heading, and the strategy behind it all. This kind of clear and open chat helps investors feel confident about their decisions, knowing they're on the same page with the [company's leadership](https://www.financealliance.io/cfo-leadership-pillars/). But don’t forget – good investor communications can boost how a company is seen in the market. When a company talks openly and regularly with its investors, it clears up any confusion, keeps everyone's expectations in check, and can even attract new investors while keeping the current ones happy. ## **What is investor relations in private equity?** [Investor relations](https://www.financealliance.io/how-to-effectively-fundraise-and-find-investors/) in private equity refers to the ongoing communication and relationship management between private equity firms and their investors, who are typically institutional investors, like pension funds or endowments, and high-net-worth individuals. Since private equity involves investments in companies that are not publicly traded, the dynamics of these relationships can be quite unique compared to public markets. ## **What is the role of a CFO in investor relations?** Essentially, the CFO is like the main storyteller for a company when it comes to chatting with investors. Their job is to make sure investors are kept in the loop and feel good about where their money is going. This usually involves: ### **Telling the financial story** The CFO breaks down the complex financial stuff into a story that makes sense. They explain how the company is doing, where it's making money, and what the challenges are. It's like translating number-crunching into a clear narrative. ### **Earnings calls and meetings** Think of these as the big stage moments for the CFO. They're presenting the company's financial results and answering all sorts of questions from investors. It's their chance to shine and reassure everyone that they've got things under control. ### **Strategy and forecasting** The CFO doesn't just talk about the here and now. They also lay out the roadmap for where the company is headed. This is about giving investors a peek into the future, like what investments the company is making and what the growth prospects look like. ### **Building trust** This is a big one. The CFO's job is to build and keep trust with investors. This means being honest, even when things aren't going great, and being clear about how they're [handling risks](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) and opportunities. ### **Crisis management** When things get rocky, the CFO is often the one who has to calm the waters. They need to communicate effectively during tough times, showing that they have a plan to [navigate through any storms](https://www.financealliance.io/steering-through-storms-a-cfos-guide-to-economic-resilience/). ### **Regulatory compliance** They also need to make sure all this communication is on the up and up, following all the rules and regulations about financial reporting and disclosures. The CFO is the go-to person for investors when they want the real scoop on the company's financial health and future. They're part therapist, part storyteller, and part strategist, all rolled into one. --- [How to effectively fundraise and find investorsIn this article, I’m going to share some stories from my fundraising career that I’ve never shared anywhere else. Each story comes with a lesson I learned along the way. Hopefully, these lessons will help you as you embark on your journey to raise capital.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceKirill Makharinsky![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/07/alexander-schimmeck-H_KabGs8FMw-unsplash-2.jpg)](https://www.financealliance.io/how-to-effectively-fundraise-and-find-investors/) --- ## **Challenges faced by CFOs in investor communications** CFOs face several challenges in investor communications, but there are practical ways to navigate these issues effectively: ### **1\. Balancing transparency with confidentiality** **Challenge:** CFOs must share enough information to keep investors informed *without* disclosing sensitive details that could harm the company's competitive position. **Solution:** Establish clear guidelines on what constitutes confidential information. Use generalized statements about strategy and performance without revealing specifics that could be leveraged by competitors. Regularly train and update your team on confidentiality protocols. Develop a consistent narrative that satisfies investors' curiosity while protecting key business secrets. ### **2\. Managing diverse investor expectations** **Challenge**: Investors have varying expectations and demands, from short-term gains to long-term strategies. **Solution:** Regularly engage with investors to understand their perspectives and priorities. Tailor your communication to address different investor groups while maintaining a consistent overall message. Use varied communication platforms (like webinars, newsletters, and one-on-one meetings) to cater to diverse investor needs while reinforcing the company's core investment thesis. ### **3\. Navigating market volatility** **Challenge:** Market fluctuations can lead to nervous investors and a demand for immediate information. **Solution:** [Prepare contingency plans](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) for different market scenarios. Communicate proactively during volatile times, even if it's to say that you are monitoring the situation and will provide more information when available. Maintain a calm and consistent tone in communications. Regularly update your crisis communication strategies to handle market uncertainties effectively. ### **4\. Compliance with regulatory requirements** **Challenge:** Ensuring that all communications comply with the increasingly complex regulatory environment. **Solution:** Stay updated on regulatory changes and have a robust compliance framework. Regularly review communication materials with legal advisors to ensure compliance. Implement comprehensive training for your finance and communication teams on regulatory requirements. Use checklists and approval processes to ensure all communications meet legal standards. ### **5\. Addressing negative performance or bad news** **Challenge:** Communicating negative financial results or company setbacks in a way that maintains investor confidence. **Solution:** Be upfront and honest about the challenges while highlighting the steps being taken to address them. Focus on the long-term vision and strategy of the company. Build a narrative that acknowledges the issues but also redirects focus to future growth plans and the company's underlying strengths. By tackling these challenges head-on with clear strategies and proactive communication, you can maintain strong and trusting relationships with your investors, even in the face of obstacles. --- [Crisis Management Plan vs Business Continuity Plan | Finance AllianceBelieve it or not, a crisis management plan is not the same as a business continuity plan. The two are similar in many ways, sure, but they have key differences that set them apart.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2022/11/Crisis-management-plan-vs-business-continuity-plan.jpg)](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) --- ## **8 Tips for better investor relations communications** Alright, let's talk about some real-world, practical tips for CFOs when it comes to nailing investor communications: ### **1\. Keep it clear and simple** Financial data can be complex, but your job is to make it understandable. Don't get lost in jargon or overly complicated explanations. Think about explaining your financials to a friend who's not a finance whiz. ### **2\. Consistency is key** Whether it's good news or bad, keep your communication style consistent. Investors should know what to expect from you in terms of tone and clarity, regardless of the situation. ### **3\. Be proactive, not reactive** Don't wait for the rumors to start flying. If there's news, especially if it's not great, be the first to communicate it. This shows that you're in control and trustworthy. ### **4\. Tell the whole story** Numbers don't exist in a vacuum. Give context. How do these financial results tie into the bigger picture of where the company is headed? What's the strategy behind the numbers? ### **5\. Listen and engage** Communication is a two-way street. Listen to what your investors are saying and asking. Their concerns and questions can give you valuable insights into what matters to them. ### **6\. Stay updated on regulations** The last thing you want is a compliance issue. Make sure you're up to date on any legal changes that affect how and what you can communicate. ### **7\. Practice makes perfect** Before those big earnings calls, practice your presentation. Know your stuff so well that even if you're thrown a curveball question, you can handle it with confidence. ### **8\. Use different channels** Some investors love detailed reports, others prefer a quick update call or an infographic. Mix up how you deliver information to cater to different preferences. ## **Poor vs excellent investor communications** The best way to understand the differences between poor investor communications vs excellent investor communications is by looking at them both in action. So, let’s imagine we're looking at two (fictional) companies – let's call them "*StruggleTech*" and "*ThriveCo*." Here's how their investor communications might stack up: ![Table part 1](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-20-at-11.39.36.png) ![Table part 2](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-20-at-11.40.38.png) In these case studies, StruggleTech's approach to investor communications is riddled with vagueness and a reactive stance, which damages investor trust. On the other hand, ThriveCo demonstrates how clarity, proactive engagement, and transparency can create a positive and trustworthy relationship with investors. --- ## Finance Alliance Pro Membership Take control and unlock your true potential with the **Finance Alliance Pro Membership -** an exclusive community that connects you with elite finance professionals and equips you with the cutting-edge tools and resources you need to dominate the field. **Fuel your growth:** - Engage in high-level discussions - Sharpen your skills - Unlock exclusive career opportunities **Join Finance Alliance Pro Membership today!** 🎓 [Sign Up](https://www.financealliance.io/pro-membership/) --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### Strategies to build an​​ effective FP&A function URL: https://www.financealliance.io/building-an-fp-a-function-strategies-for-effective-team-and-organizational-structure/ Last updated: 2025-04-07T10:03:02.000Z *This panel discussion between Ben Shaw (CFO, Vantem), Harold Tamayo (Interim CFO, Neighborhood LTC Pharmacy), and Kevin Schuler (Former SVP, Corporate FP&A, Warner Bros. Discovery) took place at the FP&A Summit in Boston in October 2023.* **Ben Shaw** I'm the CFO of Vantem. Vantem is a company that builds modular housing - houses built in factories. We're a startup in the U.S., and we've been in Latin America for about ten years. My background is that I’ve been the head of finance for startups generally. I've been in real estate for the last ten years. Before that, I was the head of finance for a tech company, and prior to that, I was in investment banking and consulting. I usually come into companies as the first internal finance guy, so I'm responsible for hiring the controller, building the FP&A function, figuring out the models, and doing strategies. **Harold Tamayo** I’m currently leading the finance function as the CFO for a long-term care pharmacy and remote monitoring patient organization that focuses on individuals with developmental disabilities. My experience has been as a CFO and FP&A. I've also been a controller in large multinational enterprises like Novartis and Merck, and very big companies like CVS Health and McKesson, where I was the SVP of investor relations, corporate FP&A, and mergers and acquisitions. **Kevin Schuler** I began my career at General Electric and GE Capital, where I learned core finance skills like accounting, operations, controllership, and FP&A. I then moved over to NBC Universal and spent several years in multiple finance roles both in New York City and in Los Angeles across the network, including Bravo USA, SYFY, advertising, sales, and television production. Then I moved across the street to Time Inc., which was the magazine division of Time Warner at the time, to augment and build out the FP&A function. After the great recession, Time Warner decided to spin off Time Inc. into its own public company. So I was part of the team that worked on the IPO, the credit markets, and all that kind of stuff to spin off the company. I got great exposure to the CFO skill set and investor relations audit as part of going through the public company process. Most recently, I ran global FP&A for Warner Brothers and WarnerMedia, which is now Warner Bros. Discovery. - [Beyond numbers: Essential skills for FP&A professionals](https://www.financealliance.io/p/591c8c2b-1dce-49c8-8e08-2062191d8bfe/#beyond-numbers-essential-skills-for-fpa-professionals) - [Centralized vs decentralized FP&A teams](https://www.financealliance.io/p/591c8c2b-1dce-49c8-8e08-2062191d8bfe/#centralized-vs-decentralized-fpa-teams) - [Collaboration is key in FP&A](https://www.financealliance.io/p/591c8c2b-1dce-49c8-8e08-2062191d8bfe/#collaboration-is-key-in-fpa) - [Standardizing data across business units in FP&A](https://www.financealliance.io/p/591c8c2b-1dce-49c8-8e08-2062191d8bfe/#standardizing-data-across-business-units-in-fpa) - [Fostering continuous learning and development in finance teams](https://www.financealliance.io/p/591c8c2b-1dce-49c8-8e08-2062191d8bfe/#fostering-continuous-learning-and-development-in-finance-teams) - [Scaling FP&A teams: Balancing headcount and skill sets for growth](https://www.financealliance.io/p/591c8c2b-1dce-49c8-8e08-2062191d8bfe/#scaling-fpa-teams-balancing-headcount-and-skill-sets-for-growth) - [Identifying crucial roles and skills for FP&A](https://www.financealliance.io/p/591c8c2b-1dce-49c8-8e08-2062191d8bfe/#identifying-crucial-roles-and-skills-for-fpa) ## Beyond numbers: Essential skills for FP&A professionals **Ben Shaw** What are the key competencies that you look for when you're hiring in FP&A? **Kevin Schuler** For me, it’s about being collaborative. You can only get so much information from the GL, and it's all about identifying the context around the number. So, being collaborative, forming relationships with folks, and forming trusting relationships when you're going through the risks and opportunities. If you don't have those relationships, you're going to get whatever's on the page, and whatever that president of the division didn't want to tell you, you're not going to find out. But suppose you have the relationships and the trust. In that case, you're going to get that information and you can start to think about how you’re going to mitigate this potential risk that you now know about, whereas you wouldn't be able to do that without trusting relationships. **Harold Tamayo** I’d like to break it down into three components. The first one is that you’ve got to know your fundamentals. A lot of FP&A people who are starting in their careers frown upon that, but it's difficult to become a very good FP&A person if you don't know revenue recognition, as an example. In my opinion, you have to understand the foundational components from an accounting perspective so that you know what’s in your P&L. The second one, as Kevin mentioned, is collaboration. What kind of team player are you? And can you maneuver through the different environments? When you're in FP&A, you're probably supporting various groups like HR, operations, sales, and marketing, and they all have their own dynamics. The third one is to know your business. How do you make money? How do you spend your money? Rather than coming in and talking about [budgets and forecasts](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/), can you speak to how they understand the business and how they see the business? Once you do that, then you can inject your finance knowledge, and they’ll be more likely to listen to you. **Ben Shaw** I'd agree with that. Having a general business sense is really important. That comes from knowing your business, and understanding how businesses work in general. When you look at numbers, does this number make sense from a general business perspective? And then beyond that, there's a skill that I’ve found incredibly useful. It's that skill of being able to look at a spreadsheet and see the number that looks wrong, or when you run a [scenario](https://www.financealliance.io/scenario-planning-strategic-forecasting-for-finance-teams/) and the result is X, and being able to say, “It just doesn't feel right.” It’s about having that gut sense to be able to check if these numbers sound like what they should be, and that's a really hard skill to teach. Some people have it. They just understand how numbers change. Some people don't. And I have no idea how you interview for it. **Harold Tamayo** Let me expand on that because that's very interesting what you just said. How about when some individuals in your group provide you with a forecast and when you look at it, you shake your head and say, “This makes no sense. Where is the trend?” You look historically. Say you have an average price, and in August it says it's a hundred dollars, but you look historically and it's fifty dollars on average per unit. How do you come up with those numbers? What kind of things do you tell your team? **Ben Shaw** I try to coach them and I try and spend a lot of my time with my teams, working through models with them on a granular basis and coaching them on why a trend doesn't look right to me, or going back and looking at historical numbers. I may have the context that they don't have, and I may say, “I happen to know that we're going to need to spend more in this area going forward, and this is why.” I’m trying to give them that context to the business while going through that process. To me, finance is very much a hands-on business. I found the pandemic and working from home incredibly difficult because we teach our staff how to do forecasting by working through models with them. I don't know about you guys, but I found that incredibly difficult to do in a work-from-home environment. **Kevin Schuler** Always ask folks to answer questions like, “Why are the numbers what they are? “How are they what they are?” Instead of just the ‘what.’ The ‘what’ is easy. It's the ‘why’ and the ‘how’ that are more difficult. --- [FP&A for startups: The role of FP&A in business growthIn this article, we explore how FP&A can help grow startups and provide vital support in making smart financial decisions during the early stages of growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/FP-A-startup.jpg)](https://www.financealliance.io/fp-a-for-startups/) --- # Centralized vs decentralized FP&A teams **Ben Shaw** The next question is about how you put teams together, whether they’re a centralized team in having an [FP&A team](https://www.financealliance.io/how-fp-a-teams-calculate-and-reduce-customer-churn/) at the center of the business, or whether you decentralize those teams and move them out into the business units. I come from small startups where that's less of an issue, but we have some folks who've worked at bigger companies. I'd love to hear your perspectives on how you make that distinction between a centralized FP&A team and a team that's more buried in the business units. **Harold Tamayo** If you're at a global organization and all your FP&A teams are in your office, you're pretty far removed from the business. You've helped roles at the corporate level of the FP&A, and if everybody's there, you're kind of missing the pulse of what the business is. In my view, it all depends on the activities that they have. For example, I was at a global organization where we had a lot of FP&A individuals creating a lot of standardized reporting. The reason we did all of that is because there are certain things that you can manage for the business with standardized reporting, credit efficiencies, etc. That, you can move, or at least we thought we could. We were very successful in moving that reporting and much of that went to India at the time as outsourcing. But when it came to working close together in the business and understanding from a commercial standpoint, what it means to understand the customers, what it means to understand the partners that you're dealing with, the decentralized option wasn’t there for us because you have to have that intimacy with the people that you're working with. The farther you are, the more difficult it becomes. Now, what changed the dynamic somewhat was the pandemic. We all went home and now everybody was removed. But that didn't exclude our engagement with our business partners regularly. We could understand what they were going through, and we could then provide that context of business to finance and give the right guidance. **Kevin Schuler** I also think it doesn't have to be either centralized or decentralized. It can be a mix of both. At one of the organizations I worked in, 70% of the business was pretty much one product line. Multiple different brands, but one product line. The rest of it was all different. You never want to say, “Alright, we're going to save costs and do a centralized organization across all of it.” The 70% that's like, great. You can scale India and you can centralize that part of it and then leave the other piece alone that’s close to their business. You still get close to your business, but you get the economies of scale by centralizing like product lines. Also, think about what kind of business you're in. For highly regulated industries, you'll want to have centralized because you want to make sure you've got reports, controls, and everything all buttoned up from the top down. **Ben Shaw** In the startup world, I find that it tends to be centralized because you don't have a whole lot of resources and you don't have a whole lot of expertise distributed around the company, so you tend to control that stuff fairly centrally. **Harold Tamayo** The organization I support now is small and we don't have a whole lot of people. I’m the one who works remotely, but I'm very close to understanding the parts of the business and the things that they're doing. Having everybody close together is a way to work more efficiently. # Collaboration is key in FP&A **Ben Shaw** How does the FP&A function collaborate with other departments? The critical part of being in FP&A is to work very closely with each of the departments that you're trying to do your [forecasting](https://www.financealliance.io/forecasting-growth-to-extend-runway-start-up-success-story/) for. You can't be sitting there in a vacuum creating numbers that you think might be right without understanding the complexities of the department that you're working with, without understanding what priorities they have for that year, what activities they want to be doing that year, how that fits into the overall goals of the company, and what particular activities they're going to be doing in the upcoming period. You have to be actively involved in the business. You have to understand what it is they're doing and you have to collaborate on the forecasts that you're producing. **Kevin Schuler** From a self-serving standpoint, I think the more you collaborate with divisions, the more the operators may come to you and say, “I have this problem that I'm trying to fix. I really need some help figuring it out.” You get the opportunity to help them solve a problem, help everybody achieve the [budget](https://www.financealliance.io/3-key-pain-points-in-budgeting/), and get better at what they're doing. You get to do something you wouldn't have done otherwise if you hadn't collaborated with one of the divisions and one of the operators. **Ben Shaw** I try and tell my finance team that the objective of our team is to be an enabler for the business. I want the business to come to us with their problems and say, “How do you help us fix this problem?” In many organizations, finance and HR are viewed as the blockers. Once I've figured out my project, I then have to go to HR and finance and get them to approve it. I want to try and flip that on its head and say, “When you're thinking about doing something, come to us first and let us help you figure out how to get it done.” **Harold Tamayo** I think that there’s a level of humility being in finance that you’ve got to show to be a partner and collaborate with your business. I'll give you an example. When I started my career, I was supporting sales and marketing. One of the things I did was go in the field with the reps on customer visits so that I could understand when the VP of Sales was talking to me about their budgets and they were thinking about reaching frequency, meaning how often the sales reps see customers. I then understood their language. I worked for Novartis for about seven years and I supported oncology. One of the things that I did was go with the researchers and clinicians. I probably didn't get half of what they were saying, but I understood it enough that whenever we’d talk about their activities, budgeting, and forecasting, I could speak to many of the things that they were saying. And that was appreciated by them. The way I think about collaboration is to understand your customer's perspective, just like you do in sales when you're trying to sell a product. What’s your customer's perspective? My customers are the people that I'm supporting. I'm going to push and I'm going to challenge. It's a little bit different because I'm not trying to sell something, but I'm trying to provide a service, and the service is to help them make better decisions. **Ben Shaw** My last business was a lab management business for bio and pharma. When I had a new hire come into the finance department, the first thing they did was go and spend a day in the lab figuring out what a lab does, because most of us have no clue what labs do. So you go and work, sit with the teams there, and figure out what they do. When they start talking about a piece of equipment, what is that piece of equipment that they're talking about? What does it do? How do our clients use it? If you don't know what the employee does, you have no idea how important it is. --- [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/tools-pic-2.jpeg)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) --- # Standardizing data across business units in FP&A **Ben Shaw** With regards to how you're doing business today, how do you manage data in the FP&A team to keep consistency amongst the units? **Harold Tamayo** In my previous company, we worked on a big project for three and a half years, which was called the data liquidity project. The reason we started it is because when we looked across the organization, it was very difficult to standardize and get the right level of analytics and insights that we needed. Either the sub-ledger wasn't structured appropriately because we had five to ten different ERPs and different FP&A systems, or some people might have been putting T&E inside the project cost, and they never made it to the T&E side. So, you’ve got all these things where the standardization of the data is required and governance around that data standardization is also required in order to drive the value of the insights that you're going to need. **Kevin Schuler** For us, having a data specialist in the FP&A team was really important. We were actually decentralized. That 70% I talked about earlier was decentralized at one point. So, even though they were all like businesses, they were decentralized. We had the exact same thing where somebody was putting something in a product versus a department versus an account. It was a mess. So, having that data specialist come into our FP&A team when we rolled out a new financial reporting and planning system was hugely important. We weren't necessarily going to go back and fix everything in history, but at least going forward, we could say, “No, this isn’t how we're doing it now. This is where T&E gets booked.” It was really important to have a gatekeeper who knew how to speak a data language that we didn’t as FP&A. We needed someone who knew the structure of the ledger, how to say no, and the reason why. **Ben Shaw** That person needs to know how the transactions ought to be flowing through the P&L and be able to spot when things are out of whack. When something's being entered incorrectly, they can say, “That's probably not where that's supposed to be going. It should be going somewhere else.” Hopefully, [AI](https://www.financealliance.io/ai-in-finance-ebook-download/) will help us with some of this stuff. **Kevin Schuler** I heard someone say that AI could fix our data problems. Hopefully, that's true. But if it can't, nothing will work. AI isn’t going to work. The five-million-dollar reporting system on top of all of your data that's not consistent won't work. It doesn't matter. So you have to fix the core data. **Harold Tamayo** The amount of data that we produce now in any given time is so big, so somebody needs to oversee the quality of what goes into the systems, and the standards have to be tough. # Fostering continuous learning and development in finance teams **Ben Shaw** Let's talk a little bit about professional development and how you foster professional development and continuous learning within your teams. **Kevin Schuler** I think it's about showing up to events like this and letting our team see that we're doing it. Bring your team members with you. That shows that you value it and that it's important to your team as well. I think showing by example is the best way. **Harold Tamayo** I have this philosophy which is that professional development is up to me. One of the things I'm going do as a leader is provide guidance, coaching, support, and all the necessary tools. One of the things that I like doing in terms of professional development is supporting and creating avenues for individuals to develop themselves. It's easier to blame the leaders rather than to take accountability for the things that you need to do for your path to grow and compete for the roles that you want to go for in the future. Ultimately, it's your career. **Ben Shaw** I agree. I think it's the leader's role to develop the team. If a team member is failing at a task, you have to ask, *What is it that I've not given them that they need to complete this task? Do they not have the right skills? Do they not have the right tools? Do they not have the right training? How do I provide that for them?* --- [11 must-read FP&A books 📚Get ready to add more titles to your TBR (to be read) list as we reveal the 11 best FP&A books to help you excel within your role.👇🏼![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/books12.jpg)](https://www.financealliance.io/11-must-read-fp-a-books/) --- # Scaling FP&A teams: Balancing headcount and skill sets for growth **Ben Shaw** What are the considerations when scaling the team in terms of both headcount and skill sets? **Harold Tamayo** There's a lot of art involved in doing that because you’ve got to understand the vision of your group. Where is it that you want to head? It's going to look different depending on the organization and the sophistication of that group. For example, when I came into my current organization, one of the basic things that we were missing was controls on the reconciliation process of the revenue. We were going from one system to another to another, and across all of that, we were missing revenue. So, what did we need to do? We had to develop some of the controls and some of the skillsets of the team to learn how to check and provide the level of reconciliation on the revenue side because it’s high volume, lots of transactions, and you’ve got to be able to do that. So, if I only think a year ahead, which is not that far ahead, given the size of the organization, then I’ve got to put a system in place, I have to put the skill set training in place for the people that are there, and then a way that they can practice and create controls, etc. So, you have to think, where in the life cycle of maturity of that organization is that? **Kevin Schuler** I agree. But I also think it’s twofold. One is to look at what your skill sets are and where your gap is. The specific example I can think of is when we spun off Time Inc. from Time Warner. We had the benefit of having Time Warner Treasury manage all of our cash flow. We didn't have to worry about cash flow when we were a division. But when we spun off, all we had to worry about was cash flow, being on our own, and paying off debt. So we had a very specific need to hire a treasure, to hire people who were experts in cash flow, who had worked through cash flow in the past. That was a very specific need. Who invented the light bulb? Thomas Edison, right? Not exactly, partially. Thomas Edison was friends with Sir Joseph Swan from the UK. Joseph Swan was trying to build a light bulb with a paper filament. He had partially evacuated glass with a paper filament. Warren De La Rue had coiled platinum filament. Heinrich Göbel had bamboo filament. Edison coordinated with all these folks. He pulled all the pieces together and created the light bulb as we knew it when it was first invented. But it wasn't Thomas Edison. It was him taking the ideas of all three of them. If Edison had just hung out with his paper filament buddies, who knows what would have happened? So, you have to take ideas from everyone. **Ben Shaw** I think it starts with having a clear sense of what it is that you're trying to do in the upcoming year. You've got to have a plan for what your team is trying to achieve and what skills you're going to need to achieve that, and then go out and hire the people that you think are going to be able to contribute to those skills, whether they have them when they're hired or not, but have the right characteristics for that. **Harold Tamayo** To me, [diversity is an entire spectrum](https://www.financealliance.io/why-we-need-to-amplify-diverse-voices-in-marketing/), and part of that spectrum includes diversity of thought and experiences. If I hire a team that has only done FP&A in sales and marketing, but I need somebody to support manufacturing and the corporate functions, I'm not saying that they wouldn't be able to learn it, but when I think through about being able to bring those experiences together and measure and share new things and ideas, it’s important for me to also have that [diversity of thought](https://www.financealliance.io/how-great-organizations-fuel-innovation-through-esg-and-diversity/). # Identifying crucial roles and skills for FP&A **Ben Shaw** Are there any essential roles or [skills in FP&A](https://www.financealliance.io/top-10-fp-a-skills-to-master/) that you must have? **Kevin Schuler** You have to have someone keeping the trains on time with a calendar or timeline of deadlines. One thing I’d like to do is be able to have the teams have some sort of very specific responsibility, maybe a P&L line, but then also own the board of directors communication or investor relations communication. You can be an expert in part of the P&L, but you also get to see the whole organization. That's the best part about being an FP&A; you do see the whole organization. You can figure out where you want to go next and trade those out sometimes. So maybe someone who’s doing IR can switch and do board directors and IR to get people with different skill sets. **Harold Tamayo** I like to have someone who knows how to consolidate the financials. When it all comes together, I'm not the last person that has the final view. I like having somebody who has the final bill before they get the financials to me, so I'm not catching a lot of the things that should have been caught before they got to me. That consolidation person has generally had a different array of experiences and different functions so they can catch and see what’s rolling up because they're going to be able to help me put together a presentation, etc. Not that I'm not hands-on, but I think that there’s also a good training ground for a very good number two that can eventually do other things. When it comes to skill set, you need a good understanding of the different components of what makes a good FP&A person, which is your basic understanding of accounting, being able to understand more than just the P&L, the balance sheet and cash flows, and being able to to have the leadership skills to manage the different groups of individuals and business partners that they’ve got to work with. --- ### FP&A Certified Core course: Reach your full potential Elevate your career with our [FP&A Certified Core course](https://certified.thealliance.io/course/fpa-certified-core ), meticulously crafted for professionals like you who are driven to excel. Whether you're looking to refine your analytical skills, master budgeting, or steer strategic decisions, this course provides the tools you need to succeed. By enrolling today, you gain access to expert-led tutorials, real-world case studies, and interactive simulations designed to boost your confidence and credentials. Don't just meet the industry standards—set them. Enroll now and transform your professional journey with every module you complete. [Sign up](https://certified.thealliance.io/course/fpa-certified-core ) ### SaaS financing solutions to fund your startup in 2024 URL: https://www.financealliance.io/saas-financing-solutions-to-fund-your-startup-in-2024/ Last updated: 2023-12-27T10:40:50.000Z We all know it by now: [SaaS](https://www.financealliance.io/build-a-saas-financial-model/) spells OPPORTUNITY. The SaaS market is on fire, with a jaw-dropping worth of approximately $197 billion in 2023, and it's revving up to hit a whopping $232 billion next year! But with that comes significant challenges. We live in economically volatile times, prospects are more hesitant than ever about crucial buying decisions and investors are far less likely to take risks with companies in their early stages than they once were. And who can honestly blame them, especially when, according to recent studies, [90% of startups fail?](https://www.forbes.com/sites/neilpatel/2015/01/16/90-of-startups-will-fail-heres-what-you-need-to-know-about-the-10/) But why does this happen? One of the key reasons is [insufficient funding](https://www.financealliance.io/how-to-effectively-fundraise-and-find-investors/) or careless spending. Investors want evidence you’re primed for long-term growth. So, having a firm grasp on your financing is a huge priority. That’s where we come in. In terms of seeking investment, SaaS companies still hold a considerable advantage over others. Here’s why. When it comes to SaaS, it's all about security. SaaS startups have a trick up their sleeve – they bring in that sweet, consistent revenue early on, unlike their tech counterparts. 💸 But there comes a time when you've gotta grow. So, how do you [extend your runway](https://www.financealliance.io/forecasting-growth-to-extend-runway-start-up-success-story/) to reach the next level? --- [11 SaaS finance strategies for scaling subscription revenueJoin us as we dive headfirst into the world of SaaS finance, helping you to better understand the industry, how it operates, and strategies to help you succeed in your role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/06/SaaS-finance-2.jpg)](https://www.financealliance.io/saas-finance-strategies/) --- Traditional banks? Not fans of lending to [SaaS companies](https://www.financealliance.io/top-10-saas-cfo-duties/).They're all about tangible assets, not our [SaaS](https://www.financealliance.io/how-cfos-can-reduce-their-saas-spend/) champions. No collateral, no loan. [Equity funding](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/)? It's an option, but who wants to give up their precious ownership and control for a few million dollars? Plus, these days, snagging venture capital is like hunting unicorns – rare and tricky. Early-stage SaaS startups, don't despair! Want to see that annual recurring revenue soar and your outward cash flow cut down to size? There are some nifty debt funding options in the game. In this article, we'll break them down, but first, a refresher course. ## What is SaaS financing? SaaS financing is all about getting the cash flow rolling for SaaS companies. These companies provide software through subscriptions or usage, but they need funds to grow, market, and make things happen. Here,we’ll go into the nitty gritty on the various SaaS financing options available to you, but in case you’re a bit strapped for time, here’s the short version. ### How do I finance my SaaS company? **Venture capital**: SaaS startups often seek investment from venture capital firms to fund their growth and development. Venture capitalists provide funding in exchange for equity in the company, and they typically look for companies with high growth potential. **Angel investors**: Angel investors are individuals who invest their own money in startups, including SaaS companies. They often provide early-stage funding to help these companies get off the ground. **Bootstrapping**: Some SaaS companies choose to bootstrap, which means they fund their growth using their own revenue and resources without seeking external funding. Bootstrapping allows companies to maintain control but may limit their growth rate. **Debt financing**: SaaS companies can also take on debt financing, such as loans or lines of credit, to fund their operations and expansion. This approach involves repaying the borrowed funds over time, often with interest. --- [The CFOs guide to effective SaaS cost managementIn this blog post, we’ll dive deep into the world of software management, revealing its game-changing importance and serving up some strategies for optimizing spend. We’ll also share practical tips to reduce SaaS spend and recommend the best tools to make the whole process run a lot smoother.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/04/SaaS-cost-management.jpg)](https://www.financealliance.io/saas-cost-management/) --- **Crowdfunding**: Crowdfunding platforms allow SaaS companies to raise money from a large number of individuals or investors who contribute smaller amounts of capital. This approach is typically used for specific projects or product launches. **Revenue-based financing**: Some SaaS companies opt for revenue-based financing, where they receive capital in exchange for a percentage of their future revenue. This arrangement allows them to access funds without giving up equity. **Private equity:** In later stages of growth, SaaS companies may attract private equity investors who provide capital in exchange for a significant ownership stake in the company. Now that we’ve gone through the cliff notes, let’s dive into some more in-depth solutions. # 5 Financing solutions for SaaS startups ### **1\. Internal funding sources/convertible debt** Before hitting the big leagues, many tech entrepreneurs turn to their inner circles for financial support: co-founders, board members, or friends and family. They often make it official with convertible debt. Convertible debt is the MVP here, with low-interest rates and the power to transform into equity when the stars align (usually after an equity financing round). It's a win-win for investors and founders, but here's the plot twist – watch out for these sneaky traps: Subordination terms : Be cautious if they're too aggressive, as they might cramp your style when seeking additional debt from other big lenders later on. Maturity date: Some convertible loans have a 24-month countdown, while others are speed demons with 18 or even 12 months. If you can't pull off that equity financing round before the clock runs out, your convertible notes won't magically turn into equity, and you'll be facing a hefty debt. However, if you’re not able to turn to your inner circle for funding, it’s time to look into venture debt financing. This is the catch-all term for a wide range of loan options designed specifically to meet the unique requirements and challenges faced by organizations ### 2\. **Revenue term loans** This is a classic setup that gives you a cash injection upfront, paid back in neat, fixed monthly installments over a set period. These loans are the Steady Eddie of the debt game, offering predictability compared to their wilder debt counterparts. Unlike those stubborn traditional bank loans that demand collateral, debt covenants, and a fair bit of hoop-jumping, the process is quick and easy! And the best part? You don't have to wager your home to fuel your startup journey! Secured against your recurring revenue streams, it might not score you that rock-bottom interest rate from a bank, but it's a lot more affordable than handing over a piece of your business for capital. --- [How to build custom copilots with Microsoft Copilot StudioMicrosoft’s latest technological marvel, Copilot Studio, announced at Ignite 2023, marks a revolutionary step for finance professionals.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/Copilot-image.webp)](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) --- ### 3\. **Revenue based financing** Traditionally, you had two choices in SaaS financing: debt or equity. But behold, there's a game-changer in town – Revenue-based financing (RBF). RBF is where you trade a piece of your future revenue for an upfront investor boost. It's like debt, but with a twist – the "interest" is a percentage of your monthly recurring revenue (MRR). And you get to keep full ownership! No dilutive financing Yep you read that right. **No dilutive financing.** ### **4\. A/R factoring** In the SaaS game, your payment schedule can be pretty diverse. Some clients are fine with monthly payments, while others roll with net 60 or even 90\. But things things get a little more interesting with A/R factoring! A/R factoring lets you borrow cash based on your accounts receivable. The catch? Your loan's approval hinges on the quality of your contracts. In a nutshell: having a Fortune 500 client in your corner can make lending a breeze. But if your contracts are still in the "just starting out" phase, you might face a few more hoops to jump through. ### **5\. An MRR line of credit** SaaS businesses thrive on MRR, and some lenders are ready to take you to the moon by offering 3–5X your MRR to boost your growth Imagine you've got $5 million in annualized revenue – tech banks might have MRR-like products tailored just for you. But most lenders will want a personal guarantee. So, do your homework and dive into that fine print before you ink the deal. Lines of credit are your go-to for short-term working capital expenses, not for those grand, long-term investments. If you don't pay back that capital pronto, it can start to bite! --- [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/tools-pic-2.jpeg)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) --- ## Wrapping up The SaaS landscape is an ever-evolving terrain of opportunity and challenge. While the market's worth continues to skyrocket, navigating the financial hurdles can be a daunting task, especially for early-stage startups. In a world where traditional financing options often fall short, it's essential to explore alternative routes to fuel your growth. From convertible debt and revenue term loans to revenue-based financing, A/R factoring, and MRR line of credit, there's a myriad of innovative solutions available to SaaS companies. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### Steering through storms: A CFO's guide to economic resilience URL: https://www.financealliance.io/steering-through-storms-a-cfos-guide-to-economic-resilience/ Last updated: 2025-04-10T07:50:59.000Z As a CFO, you're probably feeling the heat with all the talk about a looming recession, inflation, supply chain issues, and global instability. It's times like these when your role becomes *super* important. Your mission? To cultivate **resilience in economics**. That means shaping a business model that's flexible and tough enough to handle whatever the economy throws your way. You might be thinking, "*Easier said than done*," and you're not wrong. After all, the finance industry is known for its volatile nature, extreme ups and downs, and ever-changing variables. However, with the right financial resilience strategies, mindset shifts, and execution tactics, developing true economic resilience *is* possible. Keep reading to find out how. **Topics covered:** - [What makes a resilient economy?](https://www.financealliance.io/p/12e2541b-2ca6-4ec9-9db9-4fe3cf70b41c/#what-makes-a-resilient-economy) - [11 tips to build financial resilience in business](https://www.financealliance.io/p/12e2541b-2ca6-4ec9-9db9-4fe3cf70b41c/#11-tips-to-build-financial-resilience-in-business) - [Financial economic resilience: Advice from the pros](https://www.financealliance.io/p/12e2541b-2ca6-4ec9-9db9-4fe3cf70b41c/#financial-economic-resilience-advice-from-the-pros) - [Economic resilience & agile leadership ](https://www.financealliance.io/p/12e2541b-2ca6-4ec9-9db9-4fe3cf70b41c/#economic-resilience-agile-leadership) - [Economic predictions for 2024 ](https://www.financealliance.io/p/12e2541b-2ca6-4ec9-9db9-4fe3cf70b41c/#economic-predictions-for-2024) ## **What makes a resilient economy?** A financially resilient economy can withstand and recover from unexpected shocks or disruptions. There are a few key characteristics that foster [economic resilience](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/): ### **Diversification** Think about it – a one-trick pony is way more likely to stumble when the going gets tough. An economy that spreads its bets across different sectors and industries is way less likely to take a nosedive when one area hits a snag. ### **Strong financial systems** We're talking rock-solid banking and financial sectors that can take a hit *without* crumbling. Also, easy access to credit for businesses and individuals keeps the wheels turning, even when things get bumpy. ### **Adaptive capacity** It’s all about being able to pivot. Businesses, governments, and even you and me – we've all got to be ready to switch gears, embrace new tech, and shake up our game plans when needed. ### **Effective governance and institutions** Good governance is key. We need transparent, accountable institutions and effective policy-making to [manage crises](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) and drive reforms. ### **Social safety nets** When things go south, systems that help people out – like unemployment benefits and healthcare – can keep spending steady and stabilize the economy. ### **Robust infrastructure** Having solid physical and digital infrastructure in place means businesses can keep running smoothly, even when unexpected things like natural disasters or [cyberattacks](https://www.financealliance.io/cfo-cybersecurity/) happen. ### **Human capital development** Investing in education and training is a no-brainer. It gears up the workforce to adapt to new industries and tech advancements, driving innovation. ### **Global integration with local autonomy** Being connected to the global economy has its perks, but it's also smart to have some self-reliance in critical areas like food, energy, and manufacturing to avoid getting tripped up by global supply chain issues. ### **Sustainable practices** Going green isn't just trendy – it's smart. By focusing on [ESG](https://www.financealliance.io/7-benefits-of-esg-investing/) efforts such as environmental care and renewable energy, you can help reduce reliance on finite resources and lessen climate-related risks. ### **Healthy public finances** Finally, having your financial house in order – think manageable debt and the ability to gather resources in a crisis – is crucial for stability and economic resilience. --- [How to conquer cash flow challenges during economic downturnWith rumors of a potential recession hitting the US over the next 12 months, it’s no surprise that a burning topic in finance right now is how to survive an economic downturn.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBenjamin Verschuere![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/suraj-patil-s5F97wetYgw-unsplash--1---1-.jpg)](https://www.financealliance.io/how-to-conquer-the-most-common-cash-flow-challenges-during-economic-downturn/) --- ## **11 tips to build financial resilience in business** Building financial resilience in business isn't just about bracing for a hit. It's about making sure your business stays on its feet and keeps moving forward, no matter what the economy throws at you. Here’s how you can do just that: ### **1\. Strengthen your cash flow** Cash is king, right? Make sure you're getting paid on time and keeping a good relationship with your suppliers. And it's smart to have a cash reserve tucked away for rainy days. ### **2\. Diversify revenue streams** Don’t rely on just one thing. Explore new products, markets, or business models. It's all about not putting all your eggs in one basket. ### **3\. Maintain a strong balance sheet** Keep an eye on your debts and assets. Smart borrowing and investing can boost your business’s growth and resilience. ### **4\. Plan for the unexpected** Expect the best but prepare for the worst. Have plans ready for potential risks and keep updating them. ### **5\. Invest in your people** Your team is your biggest asset. [Training and developing](https://www.financealliance.io/finance-talent/) their skills mean they’re ready to handle whatever comes their way. ### **6\. Embrace technology and innovation** Stay ahead of the game with the latest tech. It can make your operations smoother and open new opportunities. ### **7\. Build strong relationships** Solid relationships with suppliers, customers, and lenders can be a lifeline when times are tough. ### **8\. Keep an eye on the market** Stay informed and be ready to adapt to industry trends and market changes. ### **9\. Prioritize sustainability** Being eco-friendly can save you money, boost your brand, and open up new markets. ### **10\. Regularly review financial health** Keeping a close eye on your financials helps you make smart decisions and tweak your strategies as needed. ### **11\. Resilient financial planning** This is all about being ready for anything. You want to have a variety of income sources and a balance sheet that's in tip-top shape. It's like having a [toolkit](https://www.financealliance.io/finance-alliance-tools-of-choice-report-2023/) with all sorts of tools – you’re prepared for different kinds of jobs or challenges that may come up. By taking these steps, you're not just setting up your business to survive the tough times; you're gearing it up to grow and flourish, no matter what the economic climate throws at you. --- [CFO interview questions and answersIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/08/CFO-interview-questions-2.jpg)](https://www.financealliance.io/cfo-interview-questions-and-answers/) --- ## Financial economic resilience: Advice from the pros Here are a few words of advice from members of our [Finance Alliance community](https://www.financealliance.io/community/) (including some of our great [event speakers](https://events.financealliance.io/?%5Fgl=1%2Aelxivl%2A%5Fga%2AMjk0MjE5MjAxLjE3MDA3MzkyOTk.%2A%5Fga%5F2NXFSBEP4N%2AMTcwMzA2NjUwNS4yMC4xLjE3MDMwNjY1MjEuMC4wLjA.)!): ![Economic resilience advice](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-20-at-10.03.57.png) ![Financial resilience advice](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-20-at-10.02.44.png) ![Economic resilience tip for CFOs](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-20-at-10.02.31.png) ![Advice for economic resilience](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-20-at-10.03.30.png) ![Economic resilience advice part 2](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-20-at-10.03.38.png) ## **Economic resilience & agile leadership** As a CFO, navigating through economic resilience isn’t just about crunching numbers and balancing budgets. It’s also about agile leadership – being that dynamic force that guides your team and company through the ups and downs of the economy. Let’s face it, when the economic seas get rough, a rigid, “stick-to-the-plan-no-matter-what” approach just doesn’t cut it. You need to be *agile*, ready to make quick decisions, and open to shifting gears when necessary. Being an agile leader means you’re *always* on your toes, looking out for both risks and opportunities. It’s not just about reacting quickly to changes; it’s also about anticipating them. As a CFO, this might mean you're frequently reassessing financial forecasts, staying ahead of market trends, or even re-evaluating investment strategies to ensure they align with the current economic climate. But agility isn’t just about what you do; it’s also about how you lead. In uncertain times, your team looks to you for direction and reassurance. This is where your communication skills come into play. Being clear, transparent, and, most importantly, frequent with your communication can make a world of difference. It’s about keeping everyone in the loop, making sure they understand not just the 'what' and the 'how,' but also the 'why' behind decisions and changes. An important part of being an agile leader is also understanding that resilience is a team sport. Investing in your team, and giving them the tools and skills they need to adapt and thrive, is crucial. It’s about creating an environment where learning, innovation, and flexibility are part of the daily routine. This way, when the unexpected hits, your team is not just ready to face it but can also find new and creative ways to overcome challenges. --- [3 principles to lead with confidence through changeAs a finance leader, you need to learn how to lead through change with confidence & in this post, Stephen Newland, Director of FP&A, shares how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceStephen Newland, CMA![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2022/12/Finance-leader.jpg)](https://www.financealliance.io/3-principles-to-lead-with-confidence-through-change/) --- ## **Economic predictions for 2024** Looking ahead to 2024, economic forecasts suggest a mixed bag. [FocusCFO](https://www.focuscfo.com/blog/cfo-role-preparing-economic-downturn) states that a recession likely to begin toward the end of 2023 and persist throughout 2024\. The high inflation experienced in the past 24 months is expected to wane during this period. However, this relief might be temporary, as inflation is forecasted to return in 2025 and remain a part of the economy for the rest of the decade On the other hand, [Fidelity International](https://www.fidelityinternational.com/editorial/article/the-economy-in-2024-something-will-give-87af1a-en5/) outlines a base case for a cyclical recession in 2024\. Driven by fiscally supported consumers and companies, the economy has shown resilience, but signs indicate it will turn lower next year. The savings buffer built up during the pandemic is nearly depleted, and with likely credit tightening and reduced fiscal support, a moderate recession seems probable. This scenario would be driven by tight monetary policy, normalizing labor markets, and eventually moving toward recovery by the end of 2024. Beyond 2024, experts from [ITR Economics](https://itreconomics.com/2030s-great-depression/) predict a ‘second Great Depression’ in the 2030s: > “*The road leading up to the Great Depression will be consequential in and of itself, with many opportunities and challenges. Business leaders need to be planning now for this period, as we all seek to maximize profits and enterprise value*.” – ITR Economics ## FAQs: Economic resilience #### ****What is the key meaning of resilience?** Resilience is the ability to quickly recover from challenges and adapt to changes, maintaining functionality and stability in the face of difficulties. #### ****What is socio-economic resilience?** Socio-economic resilience refers to the capacity of a community or society to withstand and recover from economic and social challenges, such as financial crises, natural disasters, or social disruptions. #### ****What is economic resilience?** Economic resilience is the ability of a business to withstand and recover from economic challenges like recessions, market volatility, and other financial shocks. #### ****How can CFOs improve cash flow management for resilience?** Improve cash flow by optimizing payment collections, managing payables efficiently, and maintaining an emergency cash reserve for unforeseen events. #### ****What role does technology play in economic resilience?** Technology streamlines operations, improves efficiency, and opens up new business opportunities, all of which contribute to a stronger, more resilient business. #### ****How does sustainability play a role in economic resilience?** Sustainable practices can lead to cost savings, create new business opportunities, and reduce reliance on finite resources, contributing to long-term economic stability and resilience. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### Unleashing the power of agile methodologies for FP&A URL: https://www.financealliance.io/unleashing-the-power-of-agile-methodologies-for-fp-a/ Last updated: 2023-12-15T13:56:43.000Z *Christian Martinez, Finance Automation Manager, Kraft Heinz, gave this presentation at the FP&A Summit in June, 2023\.* In this article, we delve into strategies for elevating your FP&A (Financial Planning & Analysis) function to thrive in today's dynamic business environment. Discover how adopting agile methodologies can give your FP&A operations a competitive edge, ensuring your business stays ahead in the rapidly evolving corporate landscape. **Table of contents:** - [What is agile?](https://www.financealliance.io/p/127eafb2-dc0a-4fcb-9375-ce6534771959/#what-is-agile) - [What is agile in FP&A?](https://www.financealliance.io/p/127eafb2-dc0a-4fcb-9375-ce6534771959/#what-is-agile-for-fpa) - [Why should you adopt agile in FP&A?](https://www.financealliance.io/p/127eafb2-dc0a-4fcb-9375-ce6534771959/#why-should-you-adopt-agile-in-fpa) - [How to unleash the power of agile in FP&A?](https://www.financealliance.io/p/127eafb2-dc0a-4fcb-9375-ce6534771959/#how-to-unleash-the-power-of-agile-in-fpa) - [Shortcomings of agile](https://www.financealliance.io/p/127eafb2-dc0a-4fcb-9375-ce6534771959/#shortcomings-of-agile) ## **What is agile?** Put simply, agile is a way to adapt quickly to changing circumstances in your business. More explicitly, agile is a set of values, principles, and different practices that originated in the software development industry and have since been adopted by a wide range of industries, including finance. _This post is for paying subscribers only._ ### How to identify and nurture high-performing finance professionals URL: https://www.financealliance.io/how-to-nurture-high-performance-finance-team/ Last updated: 2026-03-20T17:09:37.000Z Want to learn how to transform your finance operation into a strategic asset and unlock your team’s full potential? Nurturing high-performers, especially during times of change, is crucial in today’s fast-paced work environment where adaptability and continuous learning are key. But how can you identify the top performers in your finance team? And how can you nurture them properly and help them succeed within their roles? In this article, I share insights on how you can identify and nurture top-performing members of your finance team through the ‘Great Resignation’. **Table of contents:** - [What is the Great Resignation](https://www.financealliance.io/p/22cd28f9-fb38-43ff-a385-d6b4e93a5ec2/#what-is-the-great-resignation) - [Three ways to identify high performers](https://www.financealliance.io/p/22cd28f9-fb38-43ff-a385-d6b4e93a5ec2/#how-to-identify-high-performers) - [Strategies to nurture high performers](https://www.financealliance.io/p/22cd28f9-fb38-43ff-a385-d6b4e93a5ec2/#how-to-nurture-high-performers) ## **What is the Great Resignation?** Post-pandemic, the workplace has seen a significant shift. Dubbed the "Great Resignation," it seemed like everyone was willing to resign from their jobs, no matter the company or the salary. An article by Fortune Magazine highlighted that at least **40%** of U.S. workers were considering quitting their jobs. This phenomenon stems from various factors such as hostile work environments, employee dissatisfaction, and a reshuffling of personal priorities. ## **How to identify high performers** Identifying high performers is the first step in nurturing them. High performers exhibit three distinct habits: **1\. Discipline:** Discipline is key. Respecting schedules, organizing days to get the most out of each hour, and separating time for meetings from individual work are all signs you've got a high performer on your team. **2\. Work-life balance:** This is all about taking substantial breaks to recharge and foster creativity. It also includes breaking monthly and quarterly cycles down and brewing transformation projects. **3\. Continuous learning**: High performers constantly seek knowledge, reflect on their experiences, and strive for improvement. Documenting finance processes can reveal opportunities to empower leading performers and allow them to improve at what they do. Take ****Eliud Kipchoge**, for instance – his routine, from waking up at 5 AM to following a meticulously planned schedule, exemplifies the discipline and commitment of a high performer. ## **How to nurture high performers** If you see someone who exhibits these three main habits, you can quickly identify that this person is a high performer. After you identify the high performers in your team, you can then take actionable steps to help nurture them. Nurturing high performers involves several strategies: ### **Having purpose** *Clear ultimate goal to guide in rough times.* Having a strong sense of purpose is so important. Encourage your high performers to seek a purpose *beyond* daily tasks. Their goal shouldn’t be to send all the Excel files to the right person by the end of the day. They must have a clear ultimate goal to work towards. This will help them to define their higher purpose. ### **Embracing proven methodologies** *Agile tools and methodologies to achieve faster and better results.* Many methodologies are proven to work, so utilize methodologies like Agile and Scrum to enhance productivity. Doing so will motivate high performers to go further and increase the likelihood they’ll want to remain in their existing roles. ### **Constantly embracing challenges** *New challenges to encourage leading performers to achieve ambitious and challenging targets.* High performers won't be happy without a challenge. So, there should always be a challenge and after the challenge is complete, something new should take its place. To achieve this, you must create challenges that are aligned with the company objectives, but that are also appropriate for the high performer. ### **Increasing the scope** *Participate and lead transversal projects to constantly learn and deliver better results.* High performers are very curious. A good way to make a high performer happy in their position is to increase the scope. Allow high performers to explore and contribute beyond their immediate roles. It’s important for high performers to be motivated and not confined to a single job because they’re often curious and want to go further than that. ### **Adopting the concept of ‘culture wins’** *Leading performers feel free to grow and be themselves.* Creating an environment that fosters personal and professional growth is crucial for high performers. This should be created by directors and/or managers, who must focus on creating a culture where people can grow, develop, and be challenged. ### **Conclusion** These five levels are very important to help motivate your team to achieve their goals. Despite the Great Resignation, the pandemic created countless challenges that can be tackled while encouraging performance habits and nurturing leading performers inside companies. It’s essential to recognize that nurturing high performers is not a one-size-fits-all approach. It requires a nuanced understanding of individual needs and organizational goals. By focusing on these aspects, we can ensure that our teams are not just productive but also engaged and motivated, leading to better outcomes for everyone involved. ### Optimizing your financial strategy to account for downturns and ESG factors URL: https://www.financealliance.io/optimizing-your-financial-strategy-to-account-for-downturns-and-esg-factors/ Last updated: 2024-03-01T14:25:17.000Z *Mike Kovar, CFO and Treasurer at Acra Lending, gave this presentation at the Chief Financial Officer Summit in May 2023.* I’m Mike Kovar, and today I’ll be talking about optimizing your strategy to account for downturns and ESG factors. More specifically, I’ll be covering: - [Preparing for downturns](https://www.financealliance.io/p/22d8e40c-fe48-4895-b4c4-9fd5354bf32c/#preparing-for-downturns) - [An overview of ESG](https://www.financealliance.io/p/22d8e40c-fe48-4895-b4c4-9fd5354bf32c/#sustainability-vs-esg-what%E2%80%99s-the-difference) - [Results from the 2022 Capital Group ESG study](https://www.financealliance.io/p/22d8e40c-fe48-4895-b4c4-9fd5354bf32c/#capital-group%E2%80%99s-2022-esg-global-study) - [Sustainability](https://www.financealliance.io/p/22d8e40c-fe48-4895-b4c4-9fd5354bf32c/#the-sustainability-journey) - [The financial impact of climate-related risks](https://www.financealliance.io/p/22d8e40c-fe48-4895-b4c4-9fd5354bf32c/#the-financial-impact-of-climate-related-risks) - [The benefits of adopting a sustainability program](https://www.financealliance.io/p/22d8e40c-fe48-4895-b4c4-9fd5354bf32c/#the-benefits-of-adopting-a-sustainability-program) - [ESG reporting and attestation](https://www.financealliance.io/p/22d8e40c-fe48-4895-b4c4-9fd5354bf32c/#esg-reporting-and-attestation) ## Preparing for downturns I've been in financial services pretty much my whole life, and interest rate changes and downturns are a part of living for me. How I prepare for downturns is to think long-term. Look as far ahead as you possibly can to avoid surprises. But it’s not just about looking ahead at the long-term, but looking at trends and creating a trends committee. What's going on? This is where young employees can really provide some great value. My 18-year-old son is big into technology and he'd be the greatest person to put on this trends committee. I’d be the worst person to put on this trends committee because I'm not really using all of this new technology so I'm not seeing where it's going. So this long-term focus and trends committee would be a big benefit for everybody. _This post is for subscribers only._ ### How to conquer the most common cash flow challenges during economic downturn URL: https://www.financealliance.io/how-to-conquer-the-most-common-cash-flow-challenges-during-economic-downturn/ Last updated: 2023-12-15T13:55:50.000Z *Benjamin Verschuere, Co-founder & CIO at Treasure Financial, gave this presentation at the FP&A Summit in San Diego.* With rumors of a potential recession hitting the US over the next 12 months, it’s no surprise that a burning topic in finance right now is how to survive an economic downturn. So, I wanted to address this topic deeper and explore what exactly we mean by ‘downturn’, along with some common cash flow challenges (and solutions) to help you get through it. ## **Is a recession on the horizon?** Most CFOs already expect a downturn to come over the next 12 months. According to a recent poll, 84% of CFOs said they expected a downturn in the next six months. 90% expected a downturn to occur in the next 12 months. This data tells us that a recession or downturn is highly expected by the wider CFO community. The Federal Reserve model also shows high odds of recession: ![Federal Reserve model](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-08-at-10.14.51.png) As you can see, they are putting the other recession to happen over the next 12 months, north of 60, or close to 60%. _This post is for paying subscribers only._ ### Best practices for optimizing cash flow forecasting URL: https://www.financealliance.io/best-practices-for-optimizing-cash-flow-forecasting/ Last updated: 2026-03-04T10:00:55.000Z ***Jon Cochrane, VP of Strategy at Maximo, gave this presentation at the CFO Virtual Summit, 2023.*** Understanding how to optimize cash is very important, especially in today’s current market. If you know how to optimize cash flow in a business, you’ll be in a much healthier position financially with more accurate forecasts. In this article, I share some of the best practices for optimizing cash flow forecasting. So, if you want to know how you can transform your finance operation into a strategic asset, keep reading! ## **What’s expected of finance leaders** One of the things that we've seen at Maximo, and more broadly in the industry is that finance leaders have BIG expectations placed on them. Here are just a few: ### **The truth** First and foremost, finance leaders are expected to be the source of *truth*. They own the real business numbers. If we’re honest, we must admit that sometimes, the numbers that come from other departments aren’t always correct. Most importantly, they don’t always inform the best decisions, especially when it comes to the financial health of the business. ### **Keep the engine running** Finance leaders are expected to keep the engine running. We’ve always got to make sure that cash coming into our business is always going to be greater than the cash that's in the bank today. ### **Unlock growth** In the past, it was more traditional for finance leaders to come through an accounting path or something similar. Nowadays, though, we’re seeing a shift in finance as more CFOs and other finance leaders are tasked with finding ways to unlock growth in their businesses. Operation-orientated CFOs are more common, particularly when they’ve come from FP&A because they’re looking to the finance department to help the company unlock future growth. --- [How to build custom copilots with Microsoft Copilot StudioMicrosoft’s latest technological marvel, Copilot Studio, announced at Ignite 2023, marks a revolutionary step for finance professionals.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/Copilot-image.webp)](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) --- ## **The expectations of finance leaders** ![expectations of finance leaders](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-06-at-17.28.46.png) Living up to and even exceeding these expectations isn’t easy. When it comes to financial forecasts, if bad data goes in, bad cash forecasts come out. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-06-at-17.29.33-1.png) If you don't have a solid handle on the data coming into your business, you won’t be able to make solid decisions about the future state of the cash flow in your business. So, it's important to have a good pulse on the [data](https://www.financealliance.io/data-cleaning-techniques/), including your invoicing workflows, your DSOs, and all the different things that impact your cash forecast. ## **The journey of a single invoice** Managing a single invoice in your company can be a challenge, especially when you have hundreds or even thousands of invoices to manage. Below is a visual representation of the journey of a single invoice: ![Journey of a single invoice](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-06-at-17.29.49.png) The invoice journey begins when you send an invoice to the customer. Ideally, they’ll send you cash within 30 days, because that's what a contract says. However, it’s not uncommon for the invoice to not make it to the customer. If that happens, many times, businesses don't find out about it until 40 days after the invoice has been sent. This is usually because the invoice was due in 30 days, and it only pops on your radar once the due date has come and gone. Of course, this then leads to further issues. By the time you realize the invoice hasn’t been paid or it hasn’t reached the customer, your primary billing point of contact may have moved on. They may have retired, moved to another business, or someone else may be in charge. The next thing you know, you’re dealing with another executive or team member who's looking at the invoice and questioning *why* they’re paying this amount to this company. You will then need to answer their questions. So, how can you manage an engine like this to ensure you can manage invoices and put an accurate [cash forecast](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) together? Well, it comes down to three things… ### **1\. Automate billing and collections** When a customer closes a new contract, how quickly do you get the invoice to the customer? If you can get it done on day zero, which is what the best companies do, then many times, that cycle of the unpaid invoice never becomes an issue. This is because they are invested in your technology and platform. After all, they’ve paid for it. Automated billing helps reduce unpaid invoices. You also need to consider your collections strategy. If you want to have a fine-tuned cash engine, you need a strategy. Making sure that you've got a predefined game plan for managing your collections and identifying and [mitigating high-risk](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) invoices is so important. By high risk, I’m talking about invoices that haven’t been paid for 60 days. Put those under a magnifying glass and make sure you’ve built a solid process around automating billing and collections. ### **2\. Close A/P before next month** You must be able to close A/P before the next month begins, which can be a bigger challenge than you might think. You should have a pulse on all of your recurring expenses such as your payroll, rent, data center costs, bonuses, commissions, etc. If you can do that, you can close A/P before the end of the month. Closing A/P by the end of the month tells me you've got a really good pulse on what’s your cash out. ### **3\. Measure you’re A/R health** When it comes to cash, you've got to measure your A/R health, which comes down to two things. The first is **DSL** (day sales outstanding), so counting how many days it takes a customer to pay you after you’ve sent an invoice. There are different ways to measure DSL, but it’s essentially an estimate for figuring out how many days it takes somebody to pay you. You should be tracking that monthly. If that number ticks up, it's an indicator that you've got a problem in your cash flow engine. The second thing to measure is your **A/R health**. To measure this, you can track or count the percentage of invoices that were saved below a certain number of days outstanding, versus the percentage of invoices that have been outstanding, say more than those days. If you're doing these three things as regular occurrences, you're hitting the best practices to ultimately forecast your cash flow. So, as long as you’re doing these three things, you can make sure you’ve got good data in, which ensures you have good data and predictions going out. --- [Top-Down vs. Bottom-Up Forecasting | Finance AllianceTop-down vs bottom-up forecasting: Which method should you use to create accurate sales forecasts? Find out in this article.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/04/FA-Infographics_Forecasting.jpg)](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) --- ## **How to do a cash flow forecast** If you've never done a [cash flow forecast](https://www.financealliance.io/cash-flow-drivers-in-a-business/) before, a good place to start is with a 13-week cash flow forecast. This is a great way to give you a pulse point on what your cash is today. It also shows you what your cash flow looks like over the next three months. When you have a good pulse on your next three months, you can then create your annual forecast or a [rolling forecast](https://www.financealliance.io/should-you-use-rolling-forecasts-weighing-the-pros-and-cons/) that you can use to forecast your cash out over the next 12 months. Here’s how it works: ### **Starting point: Understanding your current bank balance** Firstly, get a clear picture of your current financial standing. Log into your bank accounts to assess your current balance. Knowing your bank balance is like having a pulse on your financial health – essential for any business. ### **The next three months: Forecasting cash inflows and outflows** Forecasting is key. Look ahead to the next three months and list out potential cash inflows and outflows. This includes payments from invoices (a primary source of income for most businesses), payroll, rent, marketing costs, and payments to vendors. Remember, your assumptions in this stage are crucial. 💡 ****Remember:** Be wary of pitfalls such as delayed start dates or gaps between bookings and billing. These can significantly impact your cash flow. For instance, a deal might be closed, but the customer might take additional time to finalize their processes, delaying payments. ## **3 tips for cash flow forecasting** 1. **Automate billing and collections:** Streamlining these processes ensures quicker cash inflow. 2. **Close Accounts Payable (AP) promptly:** Regular closing of AP helps avoid surprises in cash outflows. 3. **Monitor Accounts Receivable (AR) health:** Keep track of the money owed to your business to maintain a healthy cash flow. --- ### Spotting strategic opportunities and driving business growth URL: https://www.financealliance.io/spotting-strategic-opportunities-and-driving-business-growth/ Last updated: 2026-01-22T12:39:37.000Z *Anders Liu-Lindberg, Co-founder and Partner of the Business Partnering Institute, gave this presentation at the FP&A Summit, 2023.* The mission of FP&A is to drive the right strategic choices in the company. Although FP&A professionals spend a lot of time working with data, crunching numbers, and putting together management presentations, the role is really about identifying strategic opportunities and driving growth. So, how can your FP&A function drive business growth? Keep reading to find out! ## **FP&A’s role in strategizing** If you want to make FP&A a growth driver, you need to know how to work strategically. Back in 2018, McKinsey published a book ‘*Strategy Beyond the Hockey Stick*’ and in it, they featured the concept of a power curve. This is where they ranked every industry based on its ability to create value (measured as economic profit). ![Industry power curve](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/12/Screenshot-2023-12-06-at-18.52.07.png) **(The data is dated, but it’s more for illustrative purposes).* The point is that the 20%, most value-creating companies create significantly more value than the rest. You could probably even argue that the rest don't create any value. So, all value in the world, at least in the corporate world, is created by these top 20%. _This post is for paying subscribers only._ ### How finance professionals can adapt and thrive in the age of AI URL: https://www.financealliance.io/how-finance-professionals-can-adapt-and-thrive-in-the-age-of-ai/ Last updated: 2024-03-01T14:25:35.000Z *Katrina Martinez, Head of Finance at Hybrid Work Solutions & Peripherals at HP, gave this presentation at the FP&A Summit in June 2023.* Every single day, I see news headlines related to AI. Every single day, all over my LinkedIn feed and my Apple News feed. But there's one particular story that really caught my attention last week. It was about this lawyer In New York. It was a federal case, where a plaintiff's lawyer was suing an airline for for damages. The plaintiff's attorney sent a brief to the court which the defense reviewed. This brief referenced multiple cases, building their case and justifying the lawsuit against the airline. What was interesting was that the defense came back and said, “*Hey, we can't find these cases in any of the legal literature. Where are these cases?*” It made its way to the judge, and the judge was *very* mad. He demanded that the lawyer come forward with what happened with these fake cases. It turned out that they’d submitted six fake cases in the briefing, and the lawyer had to admit that he'd used [ChatGPT](https://www.financealliance.io/chatgpt-for-excel/) to make up the cases. The lawyer feels terrible, the judge is mad. He's considering sanctions, which can be a fine or even jail time. This is a very serious thing. I'll defend the guy a bit because if you think about all the headlines about AI that come all the time and you go into ChatGPT, under the chat box in very small print, it says that this product could actually just make up stuff about people, places, and facts. _This post is for subscribers only._ ### How to improve your strategic impact in finance URL: https://www.financealliance.io/how-to-improve-your-strategic-impact-in-finance/ Last updated: 2023-12-15T13:53:52.000Z *Chris King, Founder and Finance Transformation Consultant at Transformative CFO, gave this presentation at the FP&A Summit in San Diego in March 2023.* I recently did an informal survey of FP&A professionals. The question I asked them was: ‘*How does your job make you feel?*’ Some of the respondents said they feel like a hamster on a wheel. They’re always scurrying and never make any real progress. Others said they could barely keep their heads above water. They always feel like they’re about to go under or get hit by the next thing. Some people said they’re not keeping their heads above water, they’re drowning. Every quarter they’re drowning in this work. Others have duck syndrome; everything looks calm on the surface, but under the surface, they’re paddling furiously. Lots of [FP&A](https://www.financealliance.io/fp-a-exit-opportunities/) teams have a hero culture. It feels like this heroic effort of brute force to get to the finish line and meet deadlines. And then we get, “*Thank you, once again, for working through the weekend and all night to allow us to reach our deadline on time.*” Anytime I see this, I try to find a way to get rid of it. And then, of course, you get the firefighting. It's just one fire after another. You put one out and there's another behind you. So, how do we move into fire prevention? How do we spend less of our time in that fight, and more of our time preventing the next fire? Let’s find out… _This post is for paying subscribers only._ ### The evolution of the modern CFO to effective CEO business partners URL: https://www.financealliance.io/the-evolution-of-the-modern-cfo-to-effective-ceo-business-partners/ Last updated: 2026-03-05T16:56:44.000Z *Sireesha Venkata, CFO at Socialize | We Are Social, joined our CFO Summit and gave the following presentation.* More and more CFOs are becoming strategic thinkers, equipping them with the tools necessary to evolve into effective business partners. But how can the modern CFO transition into a business partner to the CEO? In this article, I discuss the four pillars for a successful relationship between the CFO and CEO, what CEOs *want* from their finance leaders, and how you can become a successful business partner. **Topics covered:** - [Four pillars of the CFO and CEO relationship ](https://www.financealliance.io/p/9679fd78-21c6-40c3-b951-a1f4499bf9fb/#four-pillars-of-the-cfo-and-ceo-relationship) - [Understanding the CEO personality](Understanding the CEO personality) - [How to build trust with the CEO](https://www.financealliance.io/p/9679fd78-21c6-40c3-b951-a1f4499bf9fb/#how-to-build-trust-with-the-ceo) - [Dynamics of CEO-CFO relationship](https://www.financealliance.io/p/9679fd78-21c6-40c3-b951-a1f4499bf9fb/#dynamics-of-ceo-cfo-relationship) - [Tips to enable the CFO-CEO relationship](https://www.financealliance.io/p/9679fd78-21c6-40c3-b951-a1f4499bf9fb/#tips-to-enable-the-cfo-ceo-relationship) ## **Four pillars of the CFO and CEO relationship** ### **1\. Open dialogue** The [CEO and CFO](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/) should be able to communicate effectively without fear of judgment or criticism from either party. They should be able to give each other constructive feedback, and exchange ideas for better decision-making and to help form a healthy working relationship. ### **2\. Mutual respect and trust** Both roles must have mutual respect and trust for each other. They need to rely on each other's expertise and knowledge to get decisions done speedily and have honest conversations free of any blame. ### **3\. Goals and objectives** Both parties should clearly understand what needs to be accomplished for the company to succeed. Setting measurable goals ensures that both the CEO and CFO are held accountable for the team and company’s performance. ### **4\. Willingness to collaborate** A CEO and CFO should be obligated and look forward to working together on projects that benefit their expertise and skill sets. The CEO should view the [CFO](https://www.financealliance.io/tag/cfo/) as a champion in spreading the culture of wise spending instead of as a roadblock to growth at all costs. The CFO, in turn, should enlighten the CEO on the best ways to exceed company goals while remaining cost-effective. --- [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/financial-charts-and-graphs.jpg)](https://www.financealliance.io/financial-charts-and-graphs/) --- ## **Understanding the CEO personality** ### **Pay close attention** To understand the CEO personality, you must pay close attention to the questions you’re being asked. You’ll often learn more when you listen. So, pay attention to the questions the CEO asks and find out what’s important to them and what’s top of their mind. You can also gauge their commitment to values and ascertain if they share your attitude to ethics. ### **Cultivate relationships with peers and board members** It’s important for the CFO to cultivate relationships with peers and board members, which is integral to your success. You must spend time with the board to understand their priorities in the business, and also their relationship with the CEO. And we can use this relationship to ask about hot button issues which are not obvious or what you might have expected. ### **Attend client meetings** Attend client meetings not just when you’re needed to help close the business, but to learn about the business. This way, you can help assist the CEO with business challenges they face in running the company. This will help you to better understand the business from the CEO’s lens. ### **Take data from multiple sources** You need to take data from multiple sources to help make you a better ally. Spending time with the [team beyond finance](https://www.financealliance.io/number-crunchers-finance-business-partners/) will also help you to gain more understanding of the rules and build competitive intelligence. Knowledge of the whole business – not just the financials – is the foundation of a strong CEO-CFO partnership. ## **How to build trust with the CEO** Here are some tips to help you build trust: - Consistently delivering ahead of schedule - Arriving at meetings prepared - Delivering bad news before meetings - Creating structure calendar of events - Circulation of information before meetings - Relationship with service providers - Identifying ways to evaluate instead of reasons --- [The seven Ps of a highly successful CFOIf you want to be a truly successful CFO, you must close the gap or risk losing the front seat as the trusted co-pilot in the C-suite to deliver enterprise value to company shareholders. But what are the distinguishing qualities or characteristics of a highly successful CFO?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTjendra Halima![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2022/04/businessman-g857dd76e4_1920-2.jpg)](https://www.financealliance.io/the-seven-ps-of-a-highly-successful-cfo/) --- ## **Dynamics of CEO-CFO relationship** The dynamics of this relationship involves understanding three things: ## **What do CEOs want?** > “*This is determined by the circumstances of the company size, the industry the companies in the stage the company is in, and of course the personal preference of the CEO*.” – Jack McCullough Most CEOs want something very specific, such as: **Skilful communicators:** A communicator who can articulate the vision and values of the company, be able to present [complex data](https://www.financealliance.io/7-data-management-problems-and-solutions/), and support them in communicating the vision of the company and business strategy to others. **Strategic thinkers:** CEO’s value strategic thinkers more than financial expertise. They expect us to get involved in all aspects of the businesses and be able to craft a business strategy. They need insights *beyond* numbers. **Candor:** They expect candor from their CFO and for that person to be able to deliver unvarnished truth. They need a CFO to support them in public, and challenge them in private. They are the person they rely on to have difficult conversations. **Versatility:** CEOs expect the CFO to be a [business partner](https://www.financealliance.io/finance-business-partnering-playbook-2/). They want the CFO to be enterprise wide executive with the financial expertise. --- [Your guide to financial crime risk management (FCRM)In this blog, we’re not just skimming the surface. We’re diving deep into the true meaning of financial crime risk management and demystifying how you can manage risks around money laundering, fraud, terrorist financing, and other shady activities.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/12/financial-crime-risk-management.jpg)](https://www.financealliance.io/financial-crime-risk-management-fcrm/) --- ## **What do CFOs need from the CEO?** > *“The critical aspect of modern businesses, CFO is not a finance person, but a business problem solver, who brings a finance perspective.”* Here are the three things a CEO can do to make the partnership with the CFO successful: ### **Create platforms to build business context** A CEO should be able to provide a CFO with a good platform where they can get proper business context. They can do this by including the CFO in all management committee meetings and involving them in critical hiring decisions. That way, a CFO can understand the business context better. The more a CFO knows about the business opportunities and challenges, the better their quality of input will be in the decision-making processes. ### **Empower** CEOs must empower their CFO. CFOs can go beyond the conventional aspects of the role. This involves not just doing [budgets and forecasts](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/), but getting involved in designing frameworks and monitoring any deviations in the parameters. This is the empowerment a CFO would need from CEO. ### **Sounding board** A CFO would like to be a sounding board for the CEO. When a CEO leverages the CFOs ability of being objective and articulate in company's interests, that will develop a balanced perspective in decision making processes. If a CFO gets all this, they will be set up for success. --- [13 effective tips to allocate budget across departmentsBudget allocation is the process of designating specific amounts of money to each department within a company. This article highlights 13 tips for successful budget allocation across departments…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/budget-allocation-1.jpg)](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) --- ## **What do CFOs need to do?** To ensure the basic needs and wants of the role covered, here are three things a CFO must do to make the relationship work: ### **1\. Be a solutions builder, not a ‘naysayer’** - Realize being a good accountant and risk manager are core competencies, not their entire role. - Go above and beyond to propose solutions to CEOs. By doing so, they become valuable [business partners](https://www.financealliance.io/podcast/3-pillars-successful-finance-partner/) to their CEO. ### **2\. Articulate via stories** - Willing to put themselves in the shoes of internal customers. - CEOs are comfortable with numbers. However, they often prefer straightforward, accessible ways of understanding performance. - Rely on [charts and graphs](https://www.financealliance.io/financial-charts-and-graphs/). - Don’t just present numbers, interpret them, to identify the root cause of dropped performance and recommend an action plan to rectify the situation. ### **3\. Engage on the right matters** - Engage on the right issues, at the right time and for the right time. - Most CEOs lose interest if conversations become too operational, technical/financial, or short-term. --- [The future-focused CFODiscover how the finance function can move from static, rearview reporting work to a fast-evolving, highly effective source of competitive advantage.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceIlana Esterrich![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/jamie-street-_94HLr_QXo8-unsplash--1-.jpg)](https://www.financealliance.io/the-future-focused-cfo-from-backseat-drivers-to-strategic-navigators/) --- ## **Tips to enable the CFO-CEO relationship** ### **Adopt a collaborative approach to strategic planning** Forward thinking and collaborative planning enables CFOs to successfully execute the plan. Traditionally, CEOs used to lead future things and CFOs would provide context to financial planning and challenges. Collaborative approach involves both parties getting involved more and agreeing on the overall management approach. ### **Ensure good team and tech. Automate data collection and presentation** Hire good managers who can grow in their career in a few years. Serve as a mentor and CFO and build a good team around these managers. Try your best to empower them with good technology. It’s also advised to set up financial modelling, connect all revenues and expense data to view real-time dashboards. ### **Develop a finance communication plan** Work together with the CEO to create a communication plan to disseminate financial information to the wider organisation. Tell a story by putting the context of the financial data connecting to the day to day jobs of all employees in the office. A CFO must also act as a bridge between the CEO and head of the departments. So this would be from the point of view of budgets and forecasts. ### **Challenge the CEO in the right way** Honesty is the key for any successful relationship. We need to be very careful about it. My advice is to be specific with the information. Don’t say it will not work. But instead , say “*I understand your of view and the details X X, and when I consider Y, Y, I believe things can go different, so let’s explore the options Z, Z*." 💡 Support in ****public**. Challenge in ****private**. ### **Shifting your mindset** To excel in this field, you must adopt the right mindset to make this relationship successful. A great way to get started with this is to embrace continuous learning and commit to learn and develop yourself. Stay up to date with latest information in the industry and try to attend workshops and webinars where possible. Take ownership of your career, set goals and seek out opportunities. Be proactive in pursuing your ambitions and make sure you build your personal brand to cultivate a growth mindset. It’s also important to practice effective time management and focus on the big picture. Practice being your future self. I you struggle with time management, for example, practice being a future version of yourself that is productive. Having a big picture view like this helps us to make real progress. If you have many things on your plate, concentrate on doing the important tasks first. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/10/FA_Tools_of_Choice_2023_CTA_Banner.png) ](https://www.financealliance.io/finance-alliance-tools-of-choice/) ### FP&A for startups: The role of FP&A in business growth URL: https://www.financealliance.io/fp-a-for-startups/ Last updated: 2025-04-08T17:40:48.000Z What is the role of FP&A (Financial Planning & Analysis) for startups? Well, it isn't just some fancy acronym to throw around in board meetings. When used properly, it can turn your startup dreams into profitable realities, ensuring you don't fly off the tracks when the ride gets bumpy. FP&A isn't just about balancing the books. It’s about crafting a story from numbers and turning ‘financial gibberish’ into actionable strategies. But is FP&A *really* necessary for startups? In this article, we explore how FP&A can help grow startups and provide vital support in making smart financial decisions during the early stages of growth. ## **Introduction to FP&A for startups** FP&A refers to the processes, tools, and analytics used for financial forecasting, budgeting, modeling, and reporting. For startups, FP&A is essential in translating business vision into numbers and models that tell the growth story. It provides vital visibility that helps startups: - Set realistic goals and key milestones - Understand cash burn rates and capital requirements - Identify risks and opportunities for the business - Attract investors by demonstrating traction and potential With accurate [financial planning and analysis](https://www.financealliance.io/10-big-picture-financial-planning-steps/), startups can confidently make decisions that drive scalability and profitability. --- [11 must-read FP&A books 📚Get ready to add more titles to your TBR (to be read) list as we reveal the 11 best FP&A books to help you excel within your role.👇🏼![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/books12.jpg)](https://www.financealliance.io/11-must-read-fp-a-books/) --- ## **The role of FP&A in driving startup growth** For startups focused on rapid growth, having a dedicated FP&A function (however small) can have huge benefits. Here are just some of the key ways FP&A fuels startup growth: ### **Aligning finance to business strategy** FP&A connects dreams with financial reality, acting as a bridge-builder between aspirations and practicality. It aligns your starry-eyed visions with practical financial strategies, ensuring leadership can pursue aggressive growth goals grounded in financial viability. ### **Excellent cash flow management** [Cash flow](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/) can be a fickle friend for startups. With limited funding, startups must manage cash flow meticulously to extend the runway. FP&A oversees cash planning to ensure adequate liquidity for operations and growth. Whether startups bootstrap or pursue venture capital, FP&A keeps cash reserves healthy for sustained progress. ### **Maintains investor and stakeholder relations** FP&A is your go-to relationship guru, helping you build and maintain important relationships with investors and stakeholders. It’s about building trust through transparency into the financials of the company. This helps in securing funding for growth. FP&A also communicates business health to stakeholders through [financial reporting](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/) and analytics. ### **Driving smarter business decisions** Rather than relying on intuition or guesswork, using FP&A allows you to leverage data to guide business decisions and investments. By quantifying business scenarios and evaluating risks, FP&A underscores growth moves that make strategic sense financially. The important role of FP&A in driving business growth is backed further by a 2023 report from the [ Association for Finance Professionals](https://eweb.afponline.org/eweb/DynamicPage.aspx?WebCode=LoginRequired&expires=yes&Site=afp&URL%5FSuccess=https%3a%2f%2fwww.afponline.org%2fdocs%2fdefault-source%2fregistered%2f2020fpasurvey%5Ftechnologydataplatforms-final.pdf), which said that 77% of finance professionals surveyed agreed (or strongly agreed) that FP&A delivers value-added insight. This statistic not only highlights the critical importance of FP&A in the startup ecosystem but also underscores its effectiveness in providing actionable and strategic financial guidance. --- [FP&A vs accounting: Key differences every finance pro should knowBeing able to pinpoint the key differences between FP&A and accounting is crucial for any business to manage its financial health successfully and plan for a profitable future.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/pexels-karolina-grabowska-4968630-1.jpg)](https://www.financealliance.io/fp-a-vs-accounting-key-differences-every-finance-pro-should-know/) --- ### **Builds important financial models for strategic planning** FP&A doesn’t just predict your financial future; it helps you design it. Detailed models projecting costs, revenues, working capital, and investments provide the financial scaffolding for startup growth. FP&A constructs and maintains these models that underpin growth planning. ### **Aligns the team and leadership** Using financial insights, FP&A fosters alignment across the organization on priorities and objectives. With a consistent data set, FP&A gets everyone on the same page working towards shared goals. --- ## **FAQs** ### **What is the role of FP&A in a startup?** The role of FP&A in a startup is to guide financial strategy and decision-making. This involves budgeting, forecasting, analyzing financial performance, and providing insights to support strategic decisions. FP&A helps startups understand their financial position, manage cash flow, plan for growth, and communicate financial health to stakeholders. It acts as a bridge between the startup’s strategic goals and its financial operations, ensuring alignment and [sustainable growth](https://www.financealliance.io/7-benefits-of-a-cash-flow-forecast-to-drive-sustainable-business-growth/). ### **How do you financially analyze a startup?** Financially analyzing a startup involves examining its financial statements, understanding its revenue and expense patterns, analyzing cash flow, and evaluating key financial ratios and metrics. It's important to assess the startup's burn rate, runway, profitability potential, and scalability. Also, consider market conditions, the competitive landscape, and the startup's unique value proposition as part of the analysis. ### **When should a startup start focusing on FP&A?** The sooner, the better! Think of FP&A as a seed you plant early in your startup journey. The earlier you integrate FP&A into your operations, the stronger your financial foundation will be. Ideally, start focusing on FP&A from the moment you have a business plan in place. ### **Can a small startup afford to focus on FP&A?** Absolutely! In fact, you can’t afford not to. FP&A is about making smart, informed decisions, and even the smallest startup needs that. It’s not about having a huge budget; it’s about wisely managing the resources you have. There are scalable FP&A tools and practices suitable for startups of all sizes. ### **How does FP&A help in investor relations?** FP&A is your storytelling tool for [investors](https://www.financealliance.io/how-to-streamline-investor-reporting-processes-a-comprehensive-guide/). It turns your financial data into compelling narratives about your startup’s potential and progress. By presenting clear, well-analyzed financial projections and insights, FP&A helps build investor confidence and trust, which is critical for securing and maintaining investment. ### **Do I need a dedicated FP&A team from the start?** Not necessarily. In the early stages, your FP&A function can be managed by a smaller team or even a single dedicated individual with the right expertise. As your startup grows, you can consider expanding the team to meet more complex financial planning and analysis needs. ### **How does FP&A differ in startups compared to established companies?** In startups, FP&A tends to be more dynamic and agile. The focus is often on rapid growth, managing uncertainty, and adapting quickly to market changes. In contrast, established companies might use FP&A more for stability and incremental growth. Startups require a more innovative, flexible approach to FP&A. --- ### Build your FP&A career: FP&A Certified Core course Ready to improve your financial planning and analysis skills and skyrocket your career growth? Our [FP&A Core course](https://certified.thealliance.io/course/fpa-certified-core ) is your gateway to mastering the skills and know-how needed to drive strategic business growth with the power of FP&A. By the end of this course you’ll be able to.. - Build accurate forecasts - Turn data into insights - Become a business partner ….and more. [Sign up](https://certified.thealliance.io/course/fpa-certified-core ) --- ### The ultimate guide to financial crime risk management (FCRM) URL: https://www.financealliance.io/financial-crime-risk-management-fcrm/ Last updated: 2025-04-08T17:37:20.000Z ## What is Financial Crime Risk Management (FCRM)? Financial Crime Risk Management (FCRM) is a proactive approach to identifying, investigating, analyzing, and mitigating the risks associated with financial crime. Encompassing an array of nefarious activities, from money laundering to tax fraud and cybercrimes, FCRM has become a vital strategy in our digital age, where cyber threats are not just shadowy figures in the background but palpable, urgent realities. The stakes? *Monumental*. The challenge? *Herculean*. Yet, every company *needs* an effective FCRM strategy in place. It's not just a box to be ticked off in the long checklist of financial obligations. Rather, think of it as the keystone in the arch of financial integrity and security. In this blog, we're not just skimming the surface. We're diving deep into the true meaning of financial crime risk management and demystifying how you can manage risks around money laundering, fraud, terrorist financing, and other shady activities. #### Topics covered: - - [Who commits financial crimes?](https://www.financealliance.io/p/81b80788-19ea-40a2-9fc8-68327390ae04/#who-commits-financial-crimes) - [What is a financial crime risk assessment?](https://www.financealliance.io/p/81b80788-19ea-40a2-9fc8-68327390ae04/#what-is-a-financial-crime-risk-assessment) - [How to assess your company’s financial crime risk](https://www.financealliance.io/p/81b80788-19ea-40a2-9fc8-68327390ae04/#how-to-assess-your-company%E2%80%99s-financial-crime-risk) - - [The role of CFOs in FCRM](https://www.financealliance.io/p/81b80788-19ea-40a2-9fc8-68327390ae04/#the-role-of-cfos-in-fcrm) ## What are examples of financial crimes? PwC’s [Global Economic Crime and Fraud Survey](https://www.pwc.com/gx/en/services/forensics/economic-crime-survey.html) revealed that **51%** of organizations experienced fraud in the past two years, which is the highest level in PwC’s 20 years of research. But what *types* of financial crimes should companies be aware of and prepare for? When we think of "financial crimes," our minds may jump to dramatic movie scenes of bank heists and Wall Street scams. But in reality, financial crimes cover a broad spectrum of illicit activities. Some examples are: ### Bribery and corruption This involves trading bribes for influence in business or government decisions. It not only distorts fair trade but also erodes trust in governance and market systems. ### Counterfeiting The creation of fake financial instruments like currency or checks undermines the value of real money and shatters public confidence. ### Money laundering The process of making "dirty" money appear "clean" by funneling it through legitimate businesses and transactions. It allows criminals to enjoy their ill-gotten gains without raising suspicion. ### Terrorist financing A dire issue, involving the transfer of funds to support heinous terrorist acts, directly or indirectly. ### Fraud A broad category encompassing various deceptive practices from identity theft to [financial reporting](https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/) manipulation, victimizing consumers, businesses, and governments alike. ### Cybercrime A modern plague utilizing technology to steal or compromise data, funds, or identities, ranging from small-scale thefts to massive bank heists. ### Sanctions evasion Crafty methods to sidestep economic sanctions, facilitating illicit trade and supporting nefarious entities. ### Market manipulation The abuse of insider or confidential information to unfairly profit in the financial markets, from manipulating stock prices to spreading false news. ### Insider trading Trading based on non-public, insider information, skews the playing field against ordinary investors. ### Tax fraud [JCW](https://www.jcwresourcing.com/insights/blog/5-of-the-biggest-financial-crime-trends-2023-you-should-know/) reports that **41%** of organizations are particularly concerned about tax fraud, which usually involves illegally avoiding paying owed taxes by deliberately hiding income, lying about circumstances that affect liability, or taking other deceptive actions like false reporting. ### Embezzlement The betrayal of trust by misappropriating funds, often seen in financial roles like accountancy. ### Identity theft Stealing personal information like names and social security numbers to access accounts, open fraudulent lines of credit, make unauthorized purchases, and steal funds. Often ruins victims’ finances and credit. This lineup, though not exhaustive, paints a vivid picture of the multifaceted nature of financial crimes - a web of deceit, theft, and concealment, exploiting loopholes for illegal gain. --- [10 risks of mergers and acquisitions & how to mitigate themIn this article, we explore the top 10 risks of acquiring a company and how to mitigate them.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/05/risks-of-M-A.jpg)](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) --- ## Who commits financial crimes? [Financial crime](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) can be committed by a wide range of individuals and groups, and it's not always the people you might expect. Some possible perpetrators include: **Organized criminal groups:** These are well-structured groups that plan large-scale financial crimes. They're often involved in complex schemes like money laundering or fraud. **Individual criminals:** These can be lone hackers or individuals who have no direct ties to the organization they're targeting. They might use technology to steal money or data. **Employees:** Sometimes, the people working *inside* an organization are the ones committing financial crimes. They might embezzle money, engage in fraudulent activities, or find other ways to illegally benefit at the company's expense. **Shady business leaders:** In some cases, even high-level executives or board members might be involved in financial crimes, using their positions of power to manipulate financial data or engage in insider trading. Regardless of who commits them, these crimes can have serious consequences for organizations, making it crucial for companies to have strong financial crime risk management practices in place. ## What is a financial crime risk assessment? With such a diverse array of potential financial crimes and criminals, how can institutions even begin getting a handle on their risks and vulnerabilities? This is where a financial crime risk assessment comes into play. A financial crime risk assessment is a detailed process to identify, analyze, and evaluate the firm’s exposures to money laundering, terrorist financing, fraud, and other illegal activity. It provides crucial visibility for [leadership](https://www.financealliance.io/cfo-leadership-pillars/) and boards into inherent risks, controls, incidents, and regulatory pressures. --- [CFO cybersecurity: What’s the CFO’s role in cybersecurity?From crunching numbers to combating cyber threats, the role of the CFO has leaped into uncharted territory, making CFO cybersecurity one of the hottest topics in boardrooms across the globe.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/05/CFO-cybersecurity-2.jpg)](https://www.financealliance.io/cfo-cybersecurity/) --- ## How to assess your company’s financial crime risk By assessing various risk factors, organizations can determine where to allocate their limited resources to most effectively combat the highest priority threats. This multi-step process involves: - **Cataloging laws and regulations:** Understanding the legal landscape and ensuring compliance. - **Reviewing existing measures**: Assessing current policies and defenses against financial crime. - **Financial analysis**: Scanning financial statements for unusual patterns or indicators. - **Evaluating changes and new risks:** Considering how new products or expansions into new geographies might alter risk profiles. - **Risk rating:** Assessing inherent risk across different aspects of the business. - **Surveying staff:** Gaining valuable front-line perspectives from operations staff. - **Intelligence gathering**: Incorporating insights on the latest criminal methods. - **Peer comparisons**: Benchmarking against similar institutions to identify gaps or best practices. - **Determining residual risk**: Evaluating the remaining risk after current controls. Assessing your company's financial crime risk is a crucial part of financial crime risk management. If you need a more guided approach, here's some steps you can take: ### Step 1: Identify potential risks Start by identifying financial risks in various areas of your business. This includes examining transactions, business relationships, and market trends for potential vulnerabilities. ### Step 2: Conduct a supplier financial risk assessment Evaluate the financial stability and integrity of your suppliers. This step is vital as it helps in identifying any risks that might arise from your business relationships. ### Step 3: Perform a financial crime risk assessment This involves a thorough examination of your business to identify areas susceptible to financial crimes. Look at past incidents, the nature of your transactions, and the types of financial crimes prevalent in your industry. ### Step 4: Document and prioritize risks After identifying potential risks, document them and prioritize them based on their potential impact on your organization. By systematically assessing these areas, you can create a robust strategy for financial crime prevention. --- [10 proven tips to retain top finance talentWhat can you do to keep your best employees happy and prevent them from becoming a flight risk? Here are 11 easy but effective ways to help retain your best finance talent.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/09/finance-talent.jpg)](https://www.financealliance.io/finance-talent/) --- ## How to protect against financial crime Financial institutions have a major responsibility in defending the integrity and stability of the global financial system. But with relentless threats from money launderers, fraudsters, and cybercriminals, where should they start? While an exhaustive list would span pages, protective measures tend to focus on four key pillars: ### 1\. Policies & procedures - Document risk assessment findings and translate them into comprehensive policies. - Detail risk-based procedures for client onboarding, transaction monitoring, reporting and training. - Update dynamically as financial crime compliance, regulations, and risks change. ### 2\. Detection & monitoring - Leverage data analytics and AI to quickly identify suspicious behavior. - Tune monitoring rules and scenarios to the latest criminal methodologies. - CCTV, biometrics, and [cybersecurity](https://www.financealliance.io/cfo-cybersecurity/) to deter threats. ### 3\. Partnerships & intelligence - Share information on risks with industry peers and authorities. - Liaise public-private task forces to coordinate deterrence. - Incorporate third party cyber threat intelligence. - Screen vendors, clients, and staff through checks and due diligence. ### 4\. Culture & governance - Set the tone from executives and board that compliance comes first. - Foster an ethical culture where employees feel safe raising issues. - Provide regular training tailored to roles on financial crime risks. - Establish clear accountability for risk decisions. --- [The future-focused CFODiscover how the finance function can move from static, rearview reporting work to a fast-evolving, highly effective source of competitive advantage.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceIlana Esterrich![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/jamie-street-_94HLr_QXo8-unsplash--1-.jpg)](https://www.financealliance.io/the-future-focused-cfo-from-backseat-drivers-to-strategic-navigators/) --- ## The role of CFOs in FCRM CFOs play a crucial role in Financial Crime Risk Management (FCRM). Their responsibilities include: ### Ensuring financial security CFOs are tasked with safeguarding the organization's financial assets against fraud, embezzlement, and other financial crimes. This involves overseeing financial systems, implementing effective controls, and ensuring the integrity of financial data. ### Compliance oversight They must ensure the organization complies with relevant financial crime laws and regulations. This involves staying updated on regulatory changes and ensuring the organization's policies and practices are in line with these regulations. ### Strategic decision-making CFOs are key in deciding which FCRM measures and systems to implement. They need to strategically balance risk management with operational efficiency, choosing solutions that protect the organization while supporting its business objectives. ### Resource allocation They determine the allocation of resources for FCRM initiatives, ensuring that adequate tools, technology, and personnel are available to mitigate financial crime risks. In essence, CFOs are at the forefront of creating a culture of transparency and integrity, vital in preventing financial crimes. --- ## FAQs: Financial Crime Risk Management (FCRM) What is Financial Crime Risk Management (FCRM)? TFCRM is the proactive approach to identifying, investigating, and mitigating the risks associated with financial crimes in an organization. What is the Financial Crime Risk Management Program? The Financial Crime Risk Management Program refers to a structured set of policies, procedures, and practices designed to identify, assess, monitor, and mitigate the risks of financial crimes in an organization. What does a Financial Crime Manager do? A Financial Crime Manager oversees the development and implementation of strategies to prevent financial crimes. They manage risk assessments, compliance, investigate suspicious activities, and ensure adherence to relevant laws and regulations. How can technology be used in FCRM? Technology, such as AI, machine learning, and data analytics, can be used for real-time monitoring, detection of suspicious activities, and efficient analysis of financial data. What is the role of a CFO in FCRM? CFOs are responsible for ensuring the organization's financial security, compliance with regulations, strategic decision-making in implementing FCRM measures, and allocating resources for FCRM initiatives. What is an example of a Financial Crime Risk? An example is the risk of money laundering through business transactions, where illegitimate funds are processed to appear legitimate. What are Financial Crime Risk Principles? These are guiding principles that shape how an organization approaches the prevention and management of financial crimes, including due diligence, ongoing monitoring, employee training, and compliance with legal and regulatory standards. How often should financial crime risk assessments be conducted? Risk assessments should be conducted regularly, with the frequency depending on the organization's size, complexity, and exposure to financial crime risks. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### The future-focused CFO: From backseat drivers to strategic navigators URL: https://www.financealliance.io/the-future-focused-cfo-from-backseat-drivers-to-strategic-navigators/ Last updated: 2023-11-30T13:57:56.000Z *Ilana Esterrich, former Chief Financial Officer at American Coatings Association, gave this presentation at the Chief Financial Officer Summit in January 2023.* Whether you started your career in [accounting](https://www.financealliance.io/fp-a-vs-accounting-key-differences-every-finance-pro-should-know/) and auditing, came into finance through operations or management consulting, or made a career change from a non-financial profession, we can all agree the nature of our work has changed. Doesn’t matter if you started your career way back in the days of flip charts which then became PowerPoint, or multi-column ledgers which evolved into Lotus 1-2-3, and eventually into [Excel](https://www.financealliance.io/how-to-use-python-in-excel/). Or whether you started much, much later in the [automation](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) and digitization era, our work is evolving away from the merely technical, which in large part is automated, or in the process of being automated, and is transitioning into work that relies on strategic thinking and people skills. These are two things that aren't always taught in undergraduate and graduate business programs or tested for on our various professional certification exams. Increasingly, companies are looking to their [finance leaders ](https://www.financealliance.io/3-principles-to-lead-with-confidence-through-change/)and teams to be agile, cross-functional business leaders with a broader skill set than just closing the books, preparing financial statements, and completing audit requirements. Today's financial professionals are increasingly being asked to adapt and embrace a changing operating model that’s responsive and ready to adapt, embrace the automation of traditionally manual processes, and invest in new skill sets to provide useful analytic insights and strategic guidance across an organization at multiple levels. The bottom line is that finance is shifting from tactical to strategic. - What sets the modern finance professional apart from the old-school, traditional finance professional? - How does the finance function move from static, rearview reporting work to a fast-evolving, highly effective source of competitive advantage? - And how do we move from being a cost center to being a value driver? Let’s find out… - [Where does finance fit in?](https://www.financealliance.io/p/9af221b8-938d-47be-9dda-0aff46e93cb5/#where-does-finance-fit-in) - [The finance spectrum](https://www.financealliance.io/p/9af221b8-938d-47be-9dda-0aff46e93cb5/#the-finance-spectrum) - [A fresh perspective on the office of the CFO](https://www.financealliance.io/p/9af221b8-938d-47be-9dda-0aff46e93cb5/#a-fresh-perspective-on-the-office-of-the-cfo) # Where does finance fit in? Finance has a fundamental advantage that gives us more than a fair seat at the table: 1. We have access to financial and non-financial data. 2. We have strong analytic skills. 3. We can see across the entire organizational value chain. 4. We have business acumen. But let's look at the progression of finance and accounting using a high-performance vehicle as a stand-in for our enterprises. ![Picture of a car and the words 'your company' under it](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/11/Screenshot-2023-11-22-at-15.10.35.png) First, we look out the back window. These are our financial statements, our tax statements, and other statutory reporting documents. This is basically: how did we do in a past time horizon? ### Back seat drivers We're in the back seat giving advice and making recommendations to the driver. This makes us the prototypical backseat driver. Not everyone enjoys being those or even being on the receiving end of those. We’re checking the fuel situation and kicking the tires. Do we have enough cash to meet our goals? Do we have enough fuel in the tank to get where we want the organization to go? Are we in the right vehicle to begin with? In the same way you wouldn't take a Lamborghini off-roading, we should be asking ourselves, *Does the infrastructure, tools, and human resource we have support the strategy and objectives of the organization?* *Are we using the right vehicle for the road or path we’re on?* We're also checking out the GPS. This might be a mandate set by our shareholders or in the case of not-for-profits and associations, our boards of directors. Where are we going? Did we get where we needed to go? And what course correction, if any, is needed? ### Taking the front seat More and more often, we're being invited from the back seat to sit up in the front passenger seat to navigate with our CEOs. This means we can also keep our eye on the front windshield to check for the proverbial potholes, speed bumps, and other obstacles in our path, as well as look up through the sunroof to anticipate future impacts that will require adjustments to how the vehicle is being driven, such as impending inclement weather. In this example, that might include things like growing interest in DEI or [diversity](https://www.financealliance.io/why-we-need-to-amplify-diverse-voices-in-marketing/), equity, and inclusion, [ESG initiatives](https://www.financealliance.io/7-benefits-of-esg-investing/), the demand from consumers for extended producer responsibility, post-pandemic/return to office impacts, changes in market behavior or the stock market, or product features demanded by our customers and other future factors which just cannot be ignored. --- [How to become a virtual CFO | Finance AllianceImagine having the opportunity to use your financial expertise to guide businesses globally, from the comfort of your home or any remote location (sunny beach in the Caribbean, anyone?). As a Virtual CFO or ‘vCFO’, you can do just that.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/08/how-to-become-a-virtual-cfo-2.jpg)](https://www.financealliance.io/how-to-become-a-virtual-cfo/) --- # The finance spectrum There's nothing inherently wrong with the way finance departments have worked in the past, but there's no way to stay status quo *and* be able to adequately serve the needs of the company of the future. The most valuable CFO competency today is knowledge, or how to transform finance from operating as a hindsight-looking, spreadsheet-driven accounting and reporting center, to a value-added, top-line, and forward-looking predictive hub. And we can't do that without strong skill sets in the basics. ### The basics These are table stakes, and we can't move forward if these don't exist. CFOs and their finance and accounting teams need to be firmly grounded in the basics of the profession first, such as financial reporting, accounting and controls, treasury, capital markets, budgets, and forecasting. But we’re moving away from only being the holders of the purse strings, the keepers of historical records, and the proverbial bean counters and coin stackers. These skills require context, however, so finance teams of the future need to know how their business works, who the key players are in and out of the company, and be aware of broader economic market conditions. We’re moving from being holders of the purse strings and keepers of financial records, and are now future-focused strategists who are capable of providing guidance and data-driven business insights for businesses that need them most. This means adopting a horizontal mindset, where there's a more direct collaboration with other business units beyond the traditional boundaries of the CFO's office. That might mean getting on the ground with manufacturing and walking a production line or production center to understand how your products are made, understanding the ins and outs of the sales and marketing teams, getting a feel for the R&D area and what drives decisions in product development, and understanding firsthand what customers want. It also means understanding and addressing what keeps leadership across the entire enterprise, not just your CEO, up at night. Let's automate what can be automated, wherever consistency can be implemented, or errors avoided. ### Automation These days, what *can* be automated is pretty significant thanks to systems, software, RPI, artificial intelligence, etc. If you don't know what solutions are out there, professional conferences, in-person and virtual, are a great way to learn what's in the marketplace, and what’s perfect for your team or organization. The first step in establishing a [data-driven](https://www.financealliance.io/from-data-driven-to-ai-powered/) culture is to increase automation and let software handle back-office, transactional jobs. This allows greater human focus on strategic initiatives and advanced analytics. Upgrades to a company's accounting and finance software may be required, and this can be scary for so many of us. But it’s time to move away from outdated legacy systems and a reliance on spreadsheets by adopting new automation technology that makes the accounting process as effective as possible. An average [finance team](https://www.financealliance.io/people-planning-strategically-build-your-finance-dream-team/) spends about 70% of their time trying to do their job, whether it's collecting, assembling, recording data, or creating spreadsheets, and only about 30% of their time providing actionable, data-driven decisions to support the organization. The application of ERP systems, automated business intelligence analytics, and artificial intelligence will liberate finance professionals from monotonous, error-prone manual tasks, enabling them to make impactful decisions that could add value across the organization. This will help shift resourcing to 30% doing the monotonous and tedious work, and 70% on the value-added work that helps with impactful data-driven decision-making. ## Analytic capabilities for business partnering It's time to move away from a focus on historical data only and shift to the utilization of real-time analysis, predictive modeling, and forecasting that helps businesses see around corners rather than just looking in the rearview mirror. Instead of, “Where did we land the plane last year?” We ask, “Where do we anticipate landing the plane on 12/31?” Or whatever your fiscal year-end date is. And what are the implications for the next year? In the digital world, data flows everywhere in the business. Finance needs to collaborate and build relationships to gain access to all of that data. Not only does the CFO have to understand how this process works, but they also have to train other departments on how the data works and how to properly interpret it. The CFO should be so familiar with the data that it's treated as if it's just another component of the decision-making process, another member of the team. This means increasing collaboration and relationships across the entire enterprise spectrum and not just within the CFO functional area. ### Future looking To be clear, **the CFO’s job is not going anywhere**. CFOs will only be at risk in the future if they fail to understand how data can be used and how to interpret it to make the very best decisions for the business. We want to treat the organization like it's yours, essentially, and then invest in the people, skills, and capabilities that are most needed by your organization. That means upskilling, reskilling, and hiring for new and missing skill sets. --- [CFO interview questions and answersIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/08/CFO-interview-questions-2.jpg)](https://www.financealliance.io/cfo-interview-questions-and-answers/) --- # A fresh perspective on the office of the CFO I mentioned table stakes earlier, the table stakes of the profession. Here they are, the old-fashioned CFO and the analytic CFO. Let's move on to the next set of competencies or what other capabilities we need to be developing. We want to be tech-savvy and agile, so what scenarios can we expect in the future? We also want to be disruptive and sustainable, so what big moves can we make that propels us ahead of the competition? And how can we reduce our resource spend yet increase the quality of the product? And what rounds all of this out? Strategic. The capstone of this future-focused CFO is [the ability to be strategic](https://www.financealliance.io/operational-finance/). ![Diagram of the different types of CFO](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/11/Screenshot-2023-11-22-at-15.57.32.png) ### Essential skills for future finance I've talked about the overarching concept of the future-focused CFO. Now, let's talk a little bit about the tactical specifics of the future-focused CFO. ### Hard skills **Strategic partnering** is about serving as an equal, active member of our respective leadership teams and being a key partner in the development of the organization's strategic plans. **Operational business partnering** is about partnering with organization leaders across the entire corporate spectrum to provide timely, relevant analysis, benchmarks, and business insights that inform business decisions to drive profitable, common-sense growth. We seek to support the innovation process without squashing it. The skills here include developing workarounds, operational alternatives, and plan Bs. This is why I often explain that our role is shifting from ‘CF no’ to ‘CF go,’ or at least ‘CFO will find a way.’ [**Financial planning and analysis**](https://www.financealliance.io/importance-of-fp-a/) is about developing long-range and alternative scenarios, recommending actions for operational improvements, managing performance dashboards, tracking changes in KPIs and other metrics and measures, providing leadership with support for ongoing business, and developing new growth opportunities. The skill set here ranges from being able to provide standard compliant reporting, being accurate and timely in using advanced analytics for unbiased forecasting, and long-range modeling, and being able to predict future events. Then we have **M&A, business development, and** [**investor relationships**](https://www.financealliance.io/how-to-effectively-fundraise-and-find-investors/). Risk management can include modeling the future using advanced techniques such as predictive analytics and Monte Carlo simulation to have a probabilistic conversation with the business on its high and low scenarios. And finally, we have **board/stakeholder relationship management**. But let's talk about some that we as a profession may not be as strong in, but will be critical for success. ### Soft skills **Building elite teams** includes recruiting, training, retaining, and developing top-quality talent to ensure high performance and productivity, to maintain business continuity as staff develops up and across an organization, or unfortunately sometimes out of the organization. The emphasis should be on integrity, accountability, and transparency. Hire the very best and give them the cultural and organizational safety to do their jobs. Make recommendations for becoming faster, better, more efficient, more effective, and the trust that allows them to give you feedback. Train and develop these resources to keep them. There's a quote attributed to Sir Richard Branson, the British billionaire Founder of the Virgin Group, that says: *“Train people well enough so they can leave, but treat them well enough so they don't want to.”* I'll follow that up with a quote from Henry Ford: *“The only thing worse than training your employees and having them leave is not training them and having them stay.”* Sometimes, investing in your elite team means your team members get promoted up and maybe out to other areas. But don't look at it as losing team members. Look at it instead as investing in people in a way that enhances the overall enterprise. If you aren't doing this, you risk losing elite team members from your entire enterprise altogether. As for **ethical leadership**, I shouldn't have to say too much on this because it should always be foremost and paramount. We’ll always do the right things for the right reasons at the right time. The numbers should never lie. **Communication skills** include providing a clear, concise, and transparent message, both verbally and written, and using business terminologies to gain credibility by being able to simplify complexity when communicating an advanced analytics message. This is the proverbial, what story do the numbers tell us? And by story, I'm not suggesting we tell stories and fables, but rather, how do we convert the numbers into plain English and concepts that can be used by our non-finance peers for action and direction? How many times do we say, “Revenue X is down 6%,” and expect our non-finance peers to understand the relevance? Versus, “Revenue x is down 6% because of a new entrant into our marketplace. But with the launch of new feature Y in two months, we expect the revenue decrease to reverse by 20%. We’ll continue to work with the sales and marketing team and will have an update at our next quarterly meeting.” The difference here is just dropping numbers and various percentages, versus showing the organization that we‘re fully looped in and collaborating across the entire management spectrum. **Change management** is a systematic approach to dealing with the transition or transformation of an organization's goals, processes, or technologies. The purpose of change management is to implement strategies for effecting change, controlling change, and helping people adapt to change. The key here is the ability to communicate in written form and verbally, and often deciding when a meeting should be an email, and an email should be one or more meetings. This is about communicating early and often in crafting communications that are adapted and appropriate to all levels and are specific to your key audiences. --- [Invest in your well-being: CFO strategy for peak performanceA CFO takes you through ways of managing stress and burnout through breathing techniques and guided relaxation.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceEmil Vasilev![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/bruno-nascimento-PHIgYUGQPvU-unsplash--1-.jpg)](https://www.financealliance.io/invest-in-your-well-being-a-cfos-strategy-for-peak-performance/) --- ### Leadership and EQ skills Then there's **leadership and EQ skills**. Leadership is the ability of an individual or a group of individuals to influence, guide, and motivate followers or other members of an organization to contribute toward the organization's goals. In other words, setting the vision and framework in a way that motivates the team to get there collaboratively. It differs from management in that management consists of controlling a group to accomplish a goal. I don't believe they’re mutually exclusive. At the end of the day, we’re both leaders and managers. We have to manage people to accomplish what needs accomplishing in the here and now, the must-do's and the must-haves. But we can't do that and sacrifice the focus on the longer term. Here, I'll use a quote from Steve Jobs of Apple: *“Management is about persuading people to do the things they do not want to do, while leadership is about inspiring people to do the things they never thought they could.”* By EQ, I mean the ability to understand, use, and manage your own emotions in positive ways to relieve stress, communicate effectively, empathize with others, overcome challenges, and diffuse conflict. I think we all found that to be a growing and important skill set during and after the pandemic. Putting all of this together creates long-term value and increased relevance for the office of the CFO. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/FA_Top_10_skills_every_CFO_should_master_CTA--1-.png) ](https://productmarketingall.typeform.com/to/hFpFfhSv) ### FP&A vs accounting: Key differences every finance pro should know URL: https://www.financealliance.io/fp-a-vs-accounting-key-differences-every-finance-pro-should-know/ Last updated: 2024-06-03T10:32:46.000Z [Financial planning and analysis](https://www.financealliance.io/importance-of-fp-a/) (FP&A) and [accounting](https://www.financealliance.io/the-inconvenient-truth-about-accounting-the-true-value-of-intangible-assets/) are two instrumental pillars of effective financial management. In a typical business, approximately 23% of finance spending is dedicated to financial planning and analysis, while 26% is dedicated to accounting and reporting ([Gartner](https://www.gartner.com/en/finance/research/benchmarking)). As such, being able to pinpoint the key differences between the two functions is crucial for any business to manage its financial health successfully and plan for a profitable future. In this article, we’ll delve into: - [What is FP&A?](https://www.financealliance.io/p/7749d789-da34-4721-98d3-bfd3bfa7747e/#what-is-fpa) - [What is accounting?](https://www.financealliance.io/p/7749d789-da34-4721-98d3-bfd3bfa7747e/#what-is-accounting) - [FP&A vs accounting: What’s the difference? ](https://www.financealliance.io/p/7749d789-da34-4721-98d3-bfd3bfa7747e/#fpa-vs-accounting-what%E2%80%99s-the-difference) - [What’s the difference between an FP&A manager and an accounting manager?](https://www.financealliance.io/p/7749d789-da34-4721-98d3-bfd3bfa7747e/#what%E2%80%99s-the-difference-between-an-fpa-manager-and-an-accounting-manager) - [Can you go from accounting to FP&A?](https://www.financealliance.io/p/7749d789-da34-4721-98d3-bfd3bfa7747e/#can-you-go-from-accounting-to-fpa) - [How to improve collaboration between FP&A and accounting](https://www.financealliance.io/p/7749d789-da34-4721-98d3-bfd3bfa7747e/#how-to-improve-collaboration-between-fpa-and-accounting) ## What is FP&A? Financial planning and analysis is a function that focuses on [budgeting](https://www.financealliance.io/3-key-pain-points-in-budgeting/), [forecasting,](https://www.financealliance.io/14-dos-and-donts-financial-forecast/) and analyzing financial performance to support a company’s planning and decision-making processes. [FP&A](https://www.financealliance.io/9-upcoming-trends-that-ransforming-fp-a/) professionals collect and analyze data to identify trends, answer financial questions, and develop strategies to help businesses improve results and plan for future growth. [FP&A](https://www.financealliance.io/uncovering-the-7-most-common-fp-a-designations/) also provides insights that can help businesses anticipate future financial scenarios. It involves undertaking frequent reporting to identify and resolve potential issues quickly and early. ## What is accounting? [Accounting](https://www.financealliance.io/continuous-accounting-achieving-six-hour-financial-closing/) is the process of recording, reporting, and summarizing financial information. Its job is to keep track of all financial transactions, ensuring accuracy and compliance with regulatory standards. Accounting also provides insights into a company’s financial health and overall performance, which informs crucial decision-making. It’s responsible for the preparation of cash flow statements, income statements, and balance sheets, which helps key stakeholders understand financial outcomes, profitability, and liquidity. Ultimately, accounting helps businesses understand what’s working and what’s not so they can make the necessary improvements. --- [15 best FP&A tools and software | Finance AllianceWant to choose the best FP&A tools for your business but don’t know where to start? This guide breaks down the top tools tailored to your needs.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/11/tools-pic-2.jpeg)](https://www.financealliance.io/15-best-fp-a-tools-and-software/) --- ## FP&A vs accounting: What’s the difference? You might be reading this and thinking that [FP&A](https://www.financealliance.io/9-common-myths-about-fp-a-roles/) and accounting sound like pretty similar functions so far. But in fact, there are a number of key differences that distinguish the two. Let’s take a look at a few: ### FP&A **Forward-looking**: [FP&A](https://www.financealliance.io/future-of-fp-a/) focuses on the future performance of the company. It utilizes financial modeling, [forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/), and analysis to predict financial outcomes and guide organizational alignment. According to [Battery Ventures,](https://www.battery.com/blog/solving-the-pain-of-financial-planning-software/) approximately 31% of finance departments carry out [forecasting](https://www.financealliance.io/forecasting-growth-to-extend-runway-start-up-success-story/) every quarter, while 6% do it every six months or more. **Strategic insights**: FP&A professionals analyze key trends to determine how their company will perform in the market compared to competitors, and use these insights to guide the organization to success. **Decision-focused**: FP&A teams provide valuable insights and recommendations to support decision-making regarding the allocation of resources, investment, and risk management. They help businesses understand the financial impact of strategic options through planning, [forecasting](https://www.financealliance.io/scenario-planning-strategic-forecasting-for-finance-teams/), performance management, and financial analysis. **Business-oriented**: FP&A typically builds relationships with the business to establish themselves as reliable and trusted advisors. They earn credibility and contributions to key decision-making through their strategic and operational insights. **Frequent reporting**: FP&A reports are typically prepared on a monthly or weekly basis to identify any potential issues and resolve them quickly. **Cross-functional collaboration**: An [FP&A analyst](https://www.financealliance.io/10-mistakes-i-made-as-an-fp-a-analyst/) often works closely with various departments, including sales, marketing, and operations. They help them to [manage their budgets](https://www.financealliance.io/tips-to-allocate-budget-across-departments/) and align financial objectives with the targets of the business. **Metrics**: FP&A is more focused on capital allocation, so it looks at both quantitative and qualitative metrics, KPIs, and analytics to stay up to date with any changing requirements. ### Accounting **Financial reporting**: Accounting and financial reporting involves preparing accurate financial statements for owners, regulators, and management teams that summarize the company’s financial transactions and overall performance. Reports are prepared on a quarterly and annual basis. **Compliance**: Accounting must possess a strong attention to detail to remain compliant with standardized principles and regulations. **Routine tasks**: The responsibilities of an accountant are usually transactional, routine tasks such as bookkeeping, invoicing, accounts payable, and reconciliations. **Control-focused**: Accountants also ensure that the appropriate financial controls are in place to govern and report on transactions to investors, regulators, and other relevant parties. **Relationships**: Accounting teams mostly interact with other accountants, and provide information to management teams, shareholders, regulators, and creditors. Plus, the end-users of their work are usually other finance practitioners. **KPIs**: As accounting concentrates on reporting capital, they adhere to standardized, quantitative KPIs for comparison over time and with competitors. 💡 In a nutshell, accounting focuses on the ‘what’ of financial transactions, while FP&A looks at the ‘why.’ ## What’s the difference between an FP&A manager and an accounting manager? The titles of [FP&A manager](https://www.financealliance.io/fp-a-manager-salary/) and accounting manager are often used interchangeably, when in fact, they differ significantly in their responsibilities: ### FP&A managers #### Focus and objectives FP&A managers look at the future financial performance of the company by analyzing business and economic trends, evaluating corporate activities, and then mapping out potential outcomes. #### Responsibilities - Forecasting and financial models - Creating budgets - Looking for data trends and irregularities in financial records - Developing strategic plans for achieving company objectives - Estimating financial health through key metrics - Preparing internal reports to support decision-making - Evaluating and ensuring the company optimizes its use of assets and investment opportunities ### Accounting managers #### Focus and objectives Accounting managers develop a plan of action for analyzing and reporting on financial information. They also ensure that the company adheres to legal and regulatory requirements, and identify improvements to existing business processes. #### Responsibilities - Recording company invoices and transactions, including sales, purchases, bills, cash flow, and disbursements - Checking short-term and long-term financial models - Keeping track of financial planning - Preparing annual budgets - Producing, analyzing, and reviewing financial reports - Analyzing key financial metrics in company reports and implementing improvements to existing processes - Managing financial reporting such as tax information, budgets, audits, and cost reports --- [11 must-read FP&A books 📚Get ready to add more titles to your TBR (to be read) list as we reveal the 11 best FP&A books to help you excel within your role.👇🏼![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/books12.jpg)](https://www.financealliance.io/11-must-read-fp-a-books/) --- ## Can you go from accounting to FP&A? Many accountants become interested in [transitioning to FP&A](https://www.financealliance.io/7-reasons-why-fp-a-is-becoming-a-popular-career-path/), which is a completely viable career change. Many FP&A professionals have accounting qualifications and previous experience in accounting or auditing before moving on to FP&A. Here are some top considerations and steps to take to make a smooth transition from accounting to FP&A: ### Develop transferable skills FP&A roles require you to have strong analytical skills to identify trends, patterns, and anomalies in financial data, as well as forecast and model financial outcomes. Effective communication is another vital skill of FP&A, as they need to coordinate with key stakeholders from various departments and be able to explain complex information clearly and concisely. You also need to be confident in making recommendations and decisions based on financial information. ### Familiarize yourself with FP&A technology To successfully manage financial data in FP&A, you should become proficient in the use of tools such as [Microsoft Excel](https://www.financealliance.io/chatgpt-for-excel/), [Power BI](https://www.financealliance.io/copilot-in-power-bi/), and Tableau. ### Seek opportunities within your organization Gain that all-important experience by volunteering to work on FP&A-related projects. You can gain familiarity with FP&A processes and tools and enhance your skills. You could also apply for internal FP&A job postings and transition within your current company if this is a possible option. ### Consider additional education or certification Pad out your resume by taking an additional qualification like an MBA or a CFA. You could also consider FP&A-specific certifications. For example, [Association for Financial Professionals](https://www.afponline.org/) offers globally recognized FP&A courses. --- [AI in Finance eBook | Free DownloadWelcome to the AI in Finance eBook, your trusted guide to merging AI’s vast potential with everyday finance operations such as forecasting, budgeting, analysis, and more.👇![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/10/FA_AI_in_Finance_Playbook_Blog.png)](https://www.financealliance.io/ai-in-finance-ebook-download/) --- ## How to improve collaboration between FP&A and accounting Being able to foster successful collaboration between FP&A and accounting is critical for driving insights and strategic decision-making, as well as maintaining the overall financial health of the business. Here are some top strategies to improve collaboration between FP&A and accounting: ### Regular communication channels Set up regular communication channels through meetings and workshops to discuss current projects, challenges, and other business operations to keep teams aligned. ### Joint planning and goal-setting Involve both FP&A and accounting teams in planning and goal-setting processes to ensure they understand how they each contribute to the organization’s financial goals and can work together to achieve them. ### Collaborative projects Create opportunities for collaboration between the two departments. This could be projects involving financial reporting, analysis, or budgeting, where insights from both teams are highly valuable. This will result in better business outcomes and a stronger relationship between FP&A and accounting. ### Shared KPIs and metrics Develop shared [KPIs and metrics](https://www.financealliance.io/infographic-financial-performance-metrics/) to align the efforts of FP&A and accounting and determine future outcomes. Some shared KPIs for FP&A and accounting include: - Profit and loss - Time to close - Venture capital efficiency ratio - Customer acquisition cost ratio - Return on invested capital ### Integrated systems Use integrated financial systems that both teams can access. This way, the teams can easily pull information from a single source. This reduces friction, makes it easier to share information, and aids in seamless, data-driven decision-making. ## Conclusion Understanding the key differences between FP&A vs accounting is essential for any finance professional. While accounting is all about recording and reporting on past financial transactions, FP&A looks to the future, focusing primarily on forecasting and strategic planning. Despite the differences of accounting vs FP&A, it’s clear how crucial both roles are in steering a company toward financial success, and how they can effectively collaborate to achieve key business objectives. --- ## FAQs What’s the difference between FP&A vs accounting? Accounting focuses on recording, classifying, and reporting past financial transactions, whilst ensuring compliance with regulatory standards. FP&A is more forward-looking, concentrating on budgeting, forecasting, and analyzing financial data to support strategic decision-making and guide future business performance. Is FP&A an accounting role? FP&A isn’t strictly an accounting role, although it’s closely related to the field. FP&A focuses more on future financial planning and strategic analysis, helping businesses forecast revenues and expenditures, and make strategic business decisions. Is FP&A well-paid? FP&A roles are generally well-paid. Salaries in FP&A can vary depending on factors like the individual's level of experience, the size and industry of the company, and the location of the role. Senior roles in FP&A typically have higher salaries due to their strategic importance in guiding business decisions and financial planning. Can accountants do FP&A? Yes, accountants can transition into FP&A. A background in accounting provides a solid foundation for the analytical and strategic requirements of FP&A. With some additional training in areas like strategic planning and financial modeling, accountants can effectively make this career shift. What skills are important for FP&A vs accounting? In FP&A, key skills include strategic planning, financial modeling, data analysis, forecasting, interpreting financial data to predict future trends, and supporting business decisions.Accounting requires meticulous attention to detail, proficiency in accounting principles and regulations, bookkeeping financial reporting skills, and accuracy and compliance in completing financial records. How can FP&A add value for accounting? FP&A can add significant value to accounting by providing forward-looking insights and strategic analysis that complement traditional accounting functions. While accounting focuses on accurately recording and reporting past financial transactions, FP&A uses this data to forecast future trends, analyze financial performance, and guide strategic decision-making. How does accounting support FP&A? Accounting plays a crucial role in supporting FP&A by providing accurate and timely financial data. Historical financial information prepared by the accounting team, such as income statements, balance sheets, and cash flow statements, is essential for FP&A professionals to analyze past performance, understand current financial positions, and forecast future trends. --- ### **Advance your FP&A c**areer: Enrol in our FP&A Certified Core course today Join the ranks of elite financial professionals with our [FP&A Certified Core course](https://certified.thealliance.io/course/fpa-certified-core ). Designed for those aspiring to make a significant impact in their organizations, this course offers deep dives into financial modeling, forecasting, budgeting, reporting, and more. As you progress, you’ll unlock the secrets to crafting compelling financial narratives that influence decision-making at the highest levels. Start your journey to becoming a certified FP&A expert today and build the career you've always wanted. [Enrol today](https://certified.thealliance.io/course/fpa-certified-core ) ### The critical role of financial reporting in private equity URL: https://www.financealliance.io/the-critical-role-of-financial-reporting-in-private-equity/ Last updated: 2023-11-20T17:55:39.000Z *Nathan Chandrasekaran, Co-Founder/Partner at Columbia River Partners, gave this presentation at Finance Alliance’s FP&A Summit.* Columbia River Partners is a small investment firm. We’ve been around for about three years. Prior to that, I was at a larger private equity (PE) firm in New York for about 15 years. - [Capitalizing on the foundation of tech](https://www.financealliance.io/p/5040215d-29de-4aa7-9d9d-5263d3b74ff1/#capitalizing-on-the-foundation-of-tech) - [What are private equity firms?](https://www.financealliance.io/p/5040215d-29de-4aa7-9d9d-5263d3b74ff1/#what-are-private-equity-firms) - [Financial reporting for many different constituents](https://www.financealliance.io/p/5040215d-29de-4aa7-9d9d-5263d3b74ff1/#financial-reporting-for-many-different-constituents) - [Sharing a financial reporting calendar with the CFO](https://www.financealliance.io/p/5040215d-29de-4aa7-9d9d-5263d3b74ff1/#sharing-a-financial-reporting-calendar-with-the-cfo) - [Key considerations for private equity firms](https://www.financealliance.io/p/5040215d-29de-4aa7-9d9d-5263d3b74ff1/#key-considerations-for-private-equity-firms) - [Navigating the nuances of lender reporting and compliance](https://www.financealliance.io/p/5040215d-29de-4aa7-9d9d-5263d3b74ff1/#navigating-the-nuances-of-lender-reporting-and-compliance) - [Financial reporting challenges and best practices](https://www.financealliance.io/p/5040215d-29de-4aa7-9d9d-5263d3b74ff1/#financial-reporting-challenges-and-best-practices) ## Capitalizing on the foundation of tech We invest primarily in the “picks and shovels” of technology. So if it's sexy, SaaS, growth equity, burning cash, we kind of run away from that. We focus on businesses that actually generate cash, have earnings, and a lower margin. If you look at our portfolio of companies, we have a business that manufactures fiber optic cables, we have a business that distributes Chromebooks, and a business that provides IT services for K through 12\. That's where we spend our time, so we're definitely not following the trend of super SaaS and going into a big billion-dollar company. Instead, it’s, “Hey it's a good business.” Our thesis has always been that yes, everyone wants software and everyone loves software, but you still need someone to help sell it, implement it, maintain it, and run hardware on it. My wife works at Amazon, and she always reminds me that the most valuable company in the world is actually a hardware business. It's called Apple. But they build software. They control their ecosystem with their hardware plus the software on top of it. It’s an interesting dynamic. Another one of our [investors](https://www.financealliance.io/how-to-effectively-fundraise-and-find-investors/) is a senior guy at Amazon, and they love CapEx-intensive businesses like data centers and warehouses because it makes it very hard for people to compete. It’s an interesting philosophy that they have. ## What are private equity firms? Now, let's talk about what private equity firms are. There are lots of variations of investment firms. There are buyout funds, growth equity funds, venture capital funds, real estate funds, secondary funds, I can go on. There are dozens and dozens of [funds out there](https://www.financealliance.io/external-funding-options-for-your-growing-business/). What they typically do is raise capital from high net worth and family offices and institutions, take it, and then invest it in portfolio companies, like what we do. We sit at the top; we’re the buyout fund. ![A diagram showing the different types of investment firms](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/11/Screenshot-2023-11-07-at-13.28.04.png) ## Financial reporting for many different constituents When we think about financial reporting, PE firms have a lot of constituents to deal with. We just did a deal with a company, and I was walking them through all their different constituents. Well, we've got the management team itself, what they're looking for, their KPIs, what their burn rate is, or what their cash flow generation is. Then, as the PE firm, we have to report to all these other constituents. There are **existing** [**investors**](https://www.financealliance.io/how-to-streamline-investor-reporting-processes-a-comprehensive-guide/). PE firms are always fundraising; it’s never-ending fundraising. We’re talking to **potential investors**, and the financials you show to an existing versus a potential investor can be different. And then we could talk about that for other reasons. You have **regulatory agencies**, and you have **auditors** at the PE level. There are firms like Cambridge Advisors. They call them **fund gatekeepers** or **consultants**. As a PE firm, they’re trying to raise more money. They're always getting benchmarked by third parties and what they want, and those third parties want to see every detail at the PE firm level, as well as all the way down to the portfolio level. And then they want to see consistency amongst the portfolio in terms of how they see the financials. There are also people called **placement agents**. These guys are helping funds raise money, so they want to see financials all the way down. You've also got **investment bankers** when you're selling or buying a company. You've got **tax/IRS**, and you've got **lenders** (a lot of buyout firms use debt as part of their financing). And then very last, I’ve put the actual company itself, the **management team** that needs the financials. Oftentimes, the PE firms primarily care about their investors first, which is obviously not the right way to do it, but that's what they do. So there are a lot of different constituents that they have to deal with in terms of financials, and what they want is consistency and clarity. --- [11 networking in finance tips: Building your circleNetworking in finance isn’t just about exchanging business cards and talking about the latest stock market trends. It’s about forging genuine connections and positioning yourself in a web of professionals who share insights, opportunities, and wisdom.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/networking-finance-1.png)](https://www.financealliance.io/11-networking-in-finance-tips/) --- ## Sharing a financial reporting calendar with the CFO When we buy a company, we typically buy control stakes, and often we're buying businesses where there's an owner who’s run their business for themselves for 20 years. Often, they may have a controller, they may have an AP person, and they may have a bookkeeper. And then we come in and say, “We've got equity investors, we've got debt investors, and we've got reporting requirements.” Then, we put together this nice, fancy corporate calendar and we tell them, “We need monthlies and we need quarterlies. We have compliance reports for the lenders, and we’ll have to do audits and budgets.” There's a whole bunch of stuff. We try to put this in front of an owner, and usually, they get that look on their faces that says, *What the hell is all this? Is this value add?* Of course it's not value add, but I have to do it anyway. Often, what we see on the private equity side is that finance and marketing are two of the most under-invested departments of small businesses, and I don't blame them. Often, a lot of businesses can just look at their cash flow and say, “Why do I have to do cash accrual accounting versus cash accounting? I just look at my bank balance every week. Cash goes up, I'm doing well. Cash goes down, I'm not doing well.” We just bought a business that was 100 mil of revenue and doing 20 mil of cash flow a year. The owner just did it by looking at his bank statement every week. He didn't really have a full finance function. Cash flow was positive and he was doing great, but that's how he ran his business. So we try to explain to them that when you take on institutional capital and you're taking liquidity out, part of your agreement is that you’ve now got to help the PE firm deal with all their constituents. It's usually a challenge at first, but we figure it out and we work through it, and in almost every case, we end up either replacing or augmenting the company's financial controls. It's not that they're doing a bad job, it's just that there's a different need now and there's a lot of constituents that we have to manage. ## Key considerations for private equity firms At the end of the day, what PE firms really want is to show up once a month and get their financial statements. When a firm starts digging in deeper, it’s because it's not doing well, or we're getting reports late, or it's inaccurate. I was just reviewing the financials for a company this morning, and we found out that in January they moved some cogs around, and we're trying to figure out why they got moved around from the prior January. So, when you think about what a PE firm really wants, they don't want to get involved. They just want to get their financial package monthly, they want to get their quarterly covenant statements for the banks, and then they want to get their audit at the end of the year. The reason why we put all this emphasis upfront is because if you don't lay out this foundation upfront, you end up running into a problem. Twice in my career, I've had to step in as an interim [CFO ](https://www.financealliance.io/cfo-interview-questions-and-answers/)when we couldn't get actual reporting. And I'm sitting next to the CEO, and he's telling me his bank balance is doing really well. But I'm saying, “Well, the marketing costs that you’ve put in here that you’ve spent $100,000 for this booth for the next 12 months, but you’ve put it all in the first month.” And I have to walk them through what a cash versus accrual is. So, what we try to walk through is that every company is different with different KPIs, so we leave that to each company. We also want to understand the revenue cogs, gross profit, SG&A, and EBITDA. The new common term in our world is ‘adjusted EBITDA,’ and if you don't know what that means, it's just whatever you can get away with with the lenders that makes the EBITDA higher. I’ve got to be honest, that's what we try to do. And then, obviously, you want to understand the cash flow on the balance sheet, [CapEx](https://www.financealliance.io/capex-vs-opex/), networking capital, and taxes. What's interesting is that PE firms want lots of data. Sometimes there's a lot of analysis for paralysis aspects in private equity. Firms will want to see year over year, month over month, year to date, actual versus budget, actual versus reforecast, and actual versus second reforecast. It can be mind-numbing. We have a third-party firm that helps some of our smaller companies manage that. And then we're actually working with BSP and some other companies to help put in something adaptive that’ll help us do better planning. The other big thing aside from monthly reporting is that there are K1s, audits lender compliance, and co-investor compliance. --- [AI in Finance eBook | Free DownloadWelcome to the AI in Finance eBook, your trusted guide to merging AI’s vast potential with everyday finance operations such as forecasting, budgeting, analysis, and more.👇![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/FA_AI_in_Finance_Playbook_Blog.png)](https://www.financealliance.io/ai-in-finance-ebook-download/) --- The K1 thing is super critical for private equity firms. A lot of private equity firms will invest in a combination of flow-through and C corp. We no longer invest in flow-through entities. If a company is an LLC or an S corp, we’ll always put a blocker corp above it. At my old firm, we ended up losing three investors because we couldn't get K1s at the time. The investor was livid that he had to do estimates and extensions. The reason why a PE firm likes flow-through income is because they love taking that tax distribution and applying it to the IRR calculation for when they're fundraising. Now, you can make an argument that that’s really not kosher, but a lot of PE firms do that to juice up their IRR because they take those tax distributions through a flow-through. Our view is to not play the IRR game and actually build businesses, so we put blocker corps in every one of our entities. So, if there's an operating company, there's a blocker corp, and then we'll have an LLC where all the investors sit. And the point of that is, when investors get K1s, they say, “Hey, where's my K1?’ I can write back, ‘It's going to be zero. It may be late, but it'll be zero. You'll have no K1s. And then the other issue that we ran into is, if a company’s selling in multiple states, that's a flow-through. You can file in 10, 20, or 30 states, and then you can allocate the income right across all those states. I remember that I had to file for Kentucky and Missouri for $1,000\. So, it gets very mindful. Again, that's in the private equity world. So K1s are super critical for private equity firms, getting them on time, and being accurate. Often, what happens is the PE firms don't appreciate how hard K1s are to get done properly. They'll shove it all down to the portfolio level. So, if you're a [CFO](https://www.financealliance.io/how-to-become-a-virtual-cfo/) or a controller and you've been working for a privately owned family for a long time, and then you have a PE firm that shows up that took 20 investors in their fund, now you’ve got to generate K1s for 20 investors, plus the family across multiple states. It's often a, “What did I get myself into?” situation, and that's pretty important. Also, in private equity, for most deals, you'll take on lenders and third-party debt, and they're going to require an audit. I've tried many times to get that to a review or compilation. I haven't succeeded once yet in getting that done. It's always been an audit, and audits are painful. In a lot of these private companies, they’ve never had to do a full audit. There's a setup fee, it takes time, and often, lenders want the audit done 120 days after the year-end. We always try to push to get it to 270 days so we can get it done cheaper during the summertime. We try to play that game, but lenders often push back. Again, when you're taking on capital from private equity, aside from the monthly reporting, you’ve got K1s and audits. --- [16 of the best financial charts and graphsUsing visual aids like financial charts and graphs can simplify complex data and make it more accessible. 📊 But with a variety of visuals available, which is the best fit for your needs?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/financial-charts-and-graphs.jpg)](https://www.financealliance.io/financial-charts-and-graphs/) --- ## Navigating the nuances of lender reporting and compliance Also with lenders, depending on what kind of money you've borrowed as part of the transaction, you've got compliance certificates as well as borrowing base certificates. If you don't know what those are, some lenders will borrow against the assets of the company, and every quarter, you've got to show that you're compliant with that borrowing certificate. It could be based on AR, real estate, or inventory. What's the value of it? Are you in compliance? And then often, if it's a cash flow lender, they have certain covenants. Fixed charge coverage ratio, which basically just means, what are your fixed expenses over your EBITDA? Or your total leverage, which is your total amount of debt divided by your earnings potential or your earnings. If you haven't done those before, they can get pretty tricky. When we do the leverage test, we try to use adjusted EBITDA and we try to get creative with that dynamic. I was going through one last week, where I told the controller, “Hey, let's add these four adjustments and see if we can get away with it with the lender. Let's just try and see what happens.” My success rate is pretty high. If we're going to install an ERP implementation, there's probably $100,000 in implementation costs and then a monthly $5,000\. I'm able to add $100,000 monthly. That's $100,000 one time, but not the $5,000 a month. Or, if I hire a recruiter to hire a new head of sales, I can add the recruiting costs as a one-time expense. You have to be reasonable in your requests. Where lenders push back or even we push back is if we see that same expense year over year over year, but then you should add it all back. That's where it gets tricky. But if it's truly one time, most lenders are pretty thoughtful. Most lenders are also really busy. We have six companies and we're pretty busy. Enterprise is one of our lenders, and it's an eight-person team. I think there are 60 companies that they're managing, and they're getting compliance reports. So they just want it on time. They're too busy to go and dig the weeds. They just want to get the reports to show to their credit underwriters that they're in good shape and move on. When we're looking to sell a company, we walk through what we think is realistic. You can have a litmus test of what's going to pass and what's not. You’ll often see in these small businesses that the owners try to increase their earnings by saying, “Hey, I don't need to be here anymore. You can go hire somebody.” The biggest change we often see is, “Hey, I'm paying myself. I make $500,000 as CEO, but you really only need a CEO that's $200,000\. That's usually the biggest change that we argue about with people and say that it’s not realistic. The first time we show this to a controller or [CFO](https://www.financealliance.io/5-cost-reduction-strategies/) and they’ve never done it before, it can be overwhelming for them. So we usually spend a fair amount of time making sure to ask, “Have you done compliance reporting? Have you dealt with the banks?” Once you do it the first time, it's pretty easy the second time. The only time it gets tricky is if you end up failing a test, and that's when we have to deal with it separately. But if you've got a growing company, this should be pretty straightforward. One of the things that we’ll share with the company and the finance department is the credit agreement, which is usually a 60 to 100-page document. We don't ask them to read it, but there are a lot of nuances in there of timing, the sample forms, and the definition of debt. We just worked with a company the other day and they're pitching on some business up in New York to install new hardware for a school, but the school wanted a surety bond, which is another form of indebtedness. It’s a form of insurance policy. Lenders will look at that type of insurance as additional debt, so lenders are going to have a restriction on how much more debt you can take on. So, stuff like that we'll work through with the finance team to understand all those dynamics. The last thing that we do is manage personal expenses. If you’re buying a private company that's owned by a family or an owner, they're shoving through a lot of their personal expenses to reduce their tax, which makes sense. Now you've got institutional investors. One thing we forgot to do with one of the companies about seven years ago was we forgot to share. We agreed with the owner that he could no longer expense X, Y, and Z. The CFO didn't find out and we didn't pick up on it. So, for three years the owner kept expensing his personal cars and trips to Vegas. Understanding what’s required, not required, what can be expensed, and what can’t be expensed through the company's P&L are important things to discuss with the finance team at the company. But we usually try to come up with the templates, and then we walk the finance team through how to do it. It's not hard, it's just nerve-wracking the first time if you've never done it before. --- [Finance Alliance Tools of Choice Report 2023Our ultimate directory of finance tools is here, bringing you the best tools and software of 2023 that finance pros swear by.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/FA_Tools_of_choice_Suvery_Blog_Meta_2.png)](https://www.financealliance.io/finance-alliance-tools-of-choice-report-2023/) --- ## Financial reporting challenges and best practices We've learned a few best practices. One is people and understanding how strong the finance department is. Early in my career, we probably looked at it as an oversight because we always focused on the growth drivers of the business. Now, we want to make sure that we always heavily invest in the finance department out of the gate, whether it's bringing a third-party accounting firm or a CFO firm to come in. We'll sit down with the owner and ask, “Can the person or team you have today really do the [FP&A ](https://www.financealliance.io/11-must-read-fp-a-books/)and the controller function?” And if they can't, that's okay, let's either try to train them, or if they can't train them, then we’ll bring in an outside party. And so we spend a lot of time on that. We also try to be very clear on communications in terms of what and when needs to be reported. At the end of the day, my job is to help strategically with the company on where to grow. I really don't want to be involved in the finances, except when we're dealing with the lender or the investors. So, we try to be very clear upfront, “Here's what we need, and here's what it should look like.” So that's why we have that corporate calendar, which can be overwhelming, but we try to use that. A lot of companies that we work with often start with QuickBooks, and we typically end up migrating them to NetSuite, Great Plains, or Sage. We're actually going through two implementations now where we're going from QuickBooks to NetSuite and a third one. It's on Sage, but it’s looking to move to something else because it can't get the inventory reporting. What we've learned is that one of the companies started an ERP implementation, but we put it on hold because they had no one at the company to actually manage it. So, we're going to hire a controller or senior finance person to manage that, and then we'll reengage on that. So that's something that we spent a lot of time understanding: “What kind of accounting systems are you on?” And ensuring we had the right people to support that implementation. We try to help get people packages of what we think they need to look like. Nothing is set in stone, but we try to get people what we think their monthly package should look like. Three statements, KPIs, MD&A. And then the last piece is what we talked about, the K1s, audits, and tax estimates. Those are all critical parts of the reporting process from the company up to the PE firm. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### How to build custom AI copilots with Microsoft Copilot Studio URL: https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/ Last updated: 2025-04-10T07:51:13.000Z Microsoft's latest technological marvel, Copilot Studio, announced at Ignite 2023, marks a revolutionary step for finance professionals. This comprehensive AI-powered tool, now integral to Microsoft 365, promises to redefine efficiency, creativity, and data management in the financial sector. Leading corporations like Visa and Pfizer, along with prominent partners such as Accenture and PwC, have already embraced its transformative capabilities. With [Microsoft Copilot Studio](https://www.microsoft.com/en-us/copilot/microsoft-copilot-studio#tabs-pill-bar-ocb9d4%5Ftab0), you can create a custom copilot or even integrate a custom [ChatGPT](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/) AI chatbot. But the best part is that you don’t need much (if any) code to create your own standalone copilot or AI-powered agent. In this article, we dive into what Copilot Studio is and how you can make the most of this new technology in finance. #### Table of contents - [Background and launch](https://www.financealliance.io/p/0d7598b6-6231-427d-a92b-c20b16c54504/#background-and-launch) - [Key features and innovations](https://www.financealliance.io/p/0d7598b6-6231-427d-a92b-c20b16c54504/#key-features-and-innovations) - [How finance pros can use Microsoft Copilot Studio](https://www.financealliance.io/p/0d7598b6-6231-427d-a92b-c20b16c54504/#how-finance-pros-can-use-microsoft-copilot-studio) - [How to use Microsoft Copilot Studio: A step-by-step guide](https://www.financealliance.io/p/0d7598b6-6231-427d-a92b-c20b16c54504/#how-to-use-microsoft-copilot-studio-a-step-by-step-guide) - [Future developments and availability](https://www.financealliance.io/p/0d7598b6-6231-427d-a92b-c20b16c54504/#future-developments-and-availability) ## **Background and launch** Microsoft unveiled new innovations in its Copilot technology at the [Ignite 2023](https://news.microsoft.com/ignite-2023/) event, introducing a unified Copilot experience across all Microsoft platforms. This move signifies Microsoft's commitment to integrating AI across its suite of applications, offering enhanced productivity tools to users in various fields, *including* finance. ### **General availability and early adoption** On November 1, 2023, Copilot for Microsoft 365 became generally available for enterprises. This release marked a significant milestone, with industry giants such as Visa, BP, Honda, Pfizer, and Chevron, and consultancies like Accenture, EY, KPMG, Kyndryl, and PwC, betting on Copilot's potential. The early adoption by these leading companies underscores the tool's relevance and possible applications in the financial sector​​. Head of Modern Work and Business Applications at Microsoft, Jared Spataro, had this to say about Copilot Studio: > “*With Copilot Studio, building AI assistants, and connecting them to your key business systems is as simple as talking to one.* > *"Now, you can use natural language to describe what you want — and Copilot Studio will help you build and iterate the conversation design.*” ## **Key features and innovations** The launch of [Microsoft Copilot Studio](https://www.microsoft.com/en-us/microsoft-365/blog/2023/11/15/announcing-microsoft-copilot-studio-customize-copilot-for-microsoft-365-and-build-your-own-standalone-copilots/) introduces a low-code tool for customizing Copilot within Microsoft 365 and building standalone copilots. It also comes equipped with a range of impressive features.👇🏽 ### **Microsoft Copilot Studio for customization** Copilot Studio offers end-to-end lifecycle management for customizations and standalone copilots, including building, deploying, analyzing, and managing from a single interface. This feature is particularly beneficial for financial experts seeking to connect Copilot to other data sources and systems like SAP, Workday, ServiceNow, or proprietary business solutions​​. ### **Simplified user experience and data protection** In a bid to make [Copilot](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) more accessible, Microsoft has streamlined the user experience by integrating Bing Chat and Bing Chat Enterprise into Copilot. This integration includes foundational capabilities like answering questions, content creation, and data reasoning, along with web grounding for access to the latest information. Significantly, Copilot ensures commercial data protection, respecting privacy and data security, critical aspects for financial professionals handling sensitive information​​. ### **Enhanced personalization in Microsoft 365 apps** Microsoft is introducing more personalization features to Copilot, allowing users to tailor responses based on their specific roles and preferences. This capability, initially rolling out in Word and PowerPoint, will later extend to other Microsoft 365 apps. Features like “*sound like me*” in Copilot for Outlook, which matches an individual's writing style, are particularly useful for finance professionals who require consistent and personalized communication​​. ### **Integration with Python in Excel** The recent integration of [Python in Excel](https://www.financealliance.io/how-to-use-python-in-excel/), combined with Copilot, allows you to perform sophisticated mathematical analysis using natural language commands. This synergy between one of the most powerful programming languages and Copilot's AI capabilities unlocks new potential for complex financial modeling and [data analysis​​](https://www.financealliance.io/microsoft-fabric-for-data-analysis/). ### **New collaboration capabilities** Copilot is enhancing collaboration in the workplace with new features in Microsoft Teams, Outlook, and Loop. These capabilities include participation in Teams meetings, transforming brainstorming notes into visualizations on digital whiteboards, and building shared workspaces in Microsoft Loop. For finance teams, this means improved focus during meetings, efficient note-taking, and synchronized collaboration on projects. --- [How to use GPT-4o in finance (and data analysis)You can now upload Excel, CSV, and other spreadsheet files directly to GPT-4o. No more copying and pasting data into ChatGPT manually, which makes the entire process of analyzing complex data sheets a lot easier and less time-consuming.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/GPT-4o-finance-2.jpg)](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/) --- ## **How finance pros can use Microsoft Copilot Studio** [Forrester](https://www.forrester.com/blogs/how-to-build-your-business-case-for-microsoft-365-copilot/?utm%5Fsource=pr%5Fpitch&utm%5Fmedium=pr&utm%5Fcampaign=ex) predicts that an estimated **6.9 million** U.S. knowledge workers will be using Microsoft 365 Copilot in 2024 - which is around **8%** of US knowledge workers. If that's the case, it's worth taking time to familiarise yourself with this new technology and use it within your finance role. Below, we've highlighted a few ways finance teams will likely leverage Copilot Studio: ### **1\. Customize financial reports** Microsoft Copilot Studio, with its integration into Microsoft 365, offers a transformative way to handle data analysis and report generation. By leveraging AI-powered tools, you can now quickly sift through large datasets, identify trends, and generate comprehensive reports with ease. This not only enhances efficiency but also allows for deeper insights into financial data, which is essential for making informed decisions. ### **2\. Accelerate project timelines** The introduction of Copilot Studio marks a significant leap in project development efficiency. Finance professionals can now effortlessly create, test, and deploy standalone copilots and custom GPTs. This feature is particularly beneficial for those in the fast-paced financial sector, where time is often of the essence. The ability to accelerate project timelines from conception to execution means that you can respond swiftly to market changes, regulatory updates, and internal demands, maintaining a competitive edge. ### **3\. Enhancing team collaboration and efficiency** Collaboration in finance is key. Copilot Studio enhances teamwork by integrating with Microsoft Teams and Loop, facilitating smoother communication and project management. Financial teams can use AI to organize meetings more effectively, generate minutes, and maintain a cohesive workflow, even in remote settings. This improved collaboration ensures that all team members are on the same page, increasing overall productivity. --- [How to use ChatGPT with PythonEven without deep Python knowledge, you can use ChatGPT to write Python code in a matter of seconds – and in this blog post, we’ll teach you how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/Python-ChatGPT.png)](https://www.financealliance.io/how-to-use-chatgpt-with-python/) --- ## **How to use Microsoft Copilot Studio: A step-by-step guide** Microsoft Copilot Studio is a revolutionary low-code tool designed to simplify the creation of custom plugins and GPTs (Generative Pre-trained Transformers). It seamlessly integrates sophisticated logic and a vast array of connectors to enhance your workflow. But how can you use Microsoft Copilot Studio to create a custom copilot? Here are the steps: ### **Step 1: Start with a prompt** Your journey with Copilot Studio begins with a simple prompt in Copilot. This is where you input your request or question, just like you would interact with any AI assistant. The intuitive nature of the tool makes it accessible even for those new to AI technologies. ### **Step 2: Triggering the orchestration layer** Upon receiving your prompt, Copilot Studio's orchestration layer springs into action. It scans for metadata triggers within your query. These triggers are crucial as they guide the tool to understand the context and the specific system that’ll best address your query. ### **Step 3: Querying relevant systems** Depending on your prompt, Copilot Studio might identify that the answer lies within your CRM (Customer Relationship Management) system, HR (Human Resources) system, or any other relevant application. It then formulates and sends out queries to both the Microsoft Graph and the identified system of record. ![Microsoft Copilot Studio](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/11/Screenshot-2023-11-16-at-14.53.41.png) Source: Microsoft ### **Step 4: Gathering and packaging responses** Once the queries are sent, Copilot Studio efficiently collects responses from both Microsoft Graph and the targeted system of record. These responses are then compiled, creating a comprehensive package of information that’s ready for the next stage. ### **Step 5: Reasoning and response generation** This compiled data is sent to the LLM (Large Language Model), which then applies its reasoning capabilities across both the original prompt and the gathered information. The result is a well-thought-out, contextually relevant response to your initial query. ## **Future developments and availability** ### **Upcoming features and tools** Looking ahead, Microsoft plans to introduce more advanced features to Copilot Studio that will further revolutionize financial analysis and collaboration. These features are expected to include enhanced natural language processing capabilities for even more intuitive data interaction, deeper integration with analytics tools, and more sophisticated AI-driven forecasting models. Such advancements will continue to push the boundaries of what's possible in financial data analysis and decision-making processes. ### **Broader availability and continued testing** Microsoft is also committed to expanding the availability of Copilot Studio, with plans to extend its reach to small businesses and entrepreneurs. This initiative is part of Microsoft's broader goal to democratize AI technology, making it accessible to a wider range of businesses and industries. As part of this effort, Microsoft will continue its Early Access Program, gathering feedback and making iterative improvements to ensure that Copilot Studio meets the diverse needs of its users, including those in the finance sector. Microsoft Copilot Studio is poised to become an indispensable tool for finance professionals, offering unparalleled efficiencies in data analysis, reporting, and team collaboration. With its continuous evolution and expansion, Copilot Studio is set to redefine the landscape of financial technology. --- ### FAQs: Microsoft Copilot Studio Is Microsoft Copilot available already? Yes, Microsoft Copilot was officially made available to enterprises on November 1, 2023\. It has already seen adoption by several major companies and is being integrated into various business processes and workflows. Can I install Microsoft Copilot? Microsoft Copilot is not a standalone application that you install; rather, it is integrated into Microsoft 365\. Users with access to Copilot for Microsoft 365 will find Copilot's features available within their existing Microsoft 365 applications. To access these features, ensure that your subscription includes Copilot for Microsoft 365. How does Copilot Studio enhance my work in Microsoft 365? Copilot Studio enhances your Microsoft 365 experience by allowing you to create customized AI solutions that fit your specific work requirements. Whether it's generating reports in Excel, drafting emails in Outlook, etc., Copilot Studio offers AI-powered assistance to streamline and optimize these tasks. Is Copilot Studio suitable for non-technical users? Yes, Copilot Studio is designed with a low-code approach, making it accessible for non-technical users. The intuitive interface and guided processes allow users from various professional backgrounds to create and customize AI solutions without needing in-depth programming knowledge. Is data security a concern with Microsoft Copilot? Microsoft prioritizes data security and privacy in all its products, including Copilot. Copilot Studio adheres to Microsoft's stringent security, privacy, identity, and compliance policies, ensuring that your data is protected and within your control at all times. This makes it a reliable tool for handling sensitive business data. --- # AI in Finance eBook Artificial Intelligence (AI) is reshaping the finance industry and empowering finance teams to make smarter, data-driven decisions like never before. But how can you incorporate AI into *your* financial workflow? Welcome to the **AI in Finance** eBook, your trusted guide to merging AI’s vast potential with everyday finance operations such as forecasting, budgeting, analysis, and more.👇 [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/08/FA_AI_In_Finance_Playbook_CTA.jpg) ](https://www.financealliance.io/ai-in-finance-ebook/) ## ### The winner of the Finance Alliance Awards 2023 URL: https://www.financealliance.io/the-winner-of-the-finance-alliance-awards-2023/ Last updated: 2025-04-04T14:45:14.000Z It’s time to pop the champagne as we announce the winner of the **Finance Alliance Awards 2023**! 🍾 🥂 We've combed through the final nominees, each recounting tales of extraordinary leadership, innovation, and commitment. And trust us when we say that choosing the winner hasn’t been easy. Each of our finalists has showcased exceptional expertise, dedication, and innovative approaches that have significantly impacted the finance industry. Their stories are a testament to their unwavering commitment and passion for excellence.🥇 However, we *had* to come to a decision and now, we’ve reached the moment you’ve all been waiting for... --- ### **Finance Leader of the Year 2023 🏆** We’re delighted to present the 'Finance Leader of the Year' award to **Manish Gundecha**, Senior Director of Finance Transformation at HP Inc. Manish's journey has been nothing short of inspirational. His forward-thinking approach, combined with his knack for bridging gaps between traditional finance and innovative strategies, sets him apart. Always at the forefront of driving value, Manish embodies what it truly means to be a transformative leader in finance. His dedication, insights, and unwavering commitment to excellence have set a golden standard for others to aspire to. Congratulations, **Manish**! 🥳🎉 --- ### **Thank You 🙏** A huge thank you to each and every member who participated in this year's Finance Alliance Awards. Recognizing and celebrating talent is vital to the growth and evolution of our industry. Through these awards, we aim to highlight the outstanding individuals who push the boundaries and inspire us all in the world of finance. To our community at Finance Alliance, let's continue to uplift and celebrate each other, always setting the bar higher. ### "The community is welcoming & inclusive." - Saleem Noor URL: https://www.financealliance.io/the-community-is-welcoming-inclusive-saleem-noor/ Last updated: 2023-11-14T11:25:26.000Z We're thrilled to bring you an exclusive interview with one of our most active and esteemed members, [Saleem Noor](https://www.linkedin.com/in/salim-noor-2248a11b4/). Saleem, a Senior Financial Audit Specialist at the Ministry of Finance, has been a vital part of our [Finance Alliance community](https://www.financealliance.io/community/), contributing his wealth of knowledge and experience to our vibrant network of finance professionals. In this special interview, Saleem opens up about his journey within the community. He shares his favorite resources and tools that he has discovered along the way, as well as the valuable lessons he's learned. He also discusses the unique opportunities for professional growth that the community offers. Saleem's story is not just about his individual success but also about the power of collaborative learning and networking in the digital age. Read on to discover how you, too, can enhance your career by engaging with peers and experts in the Finance Alliance Slack community!👇🏼 ### What was your motivation for joining our community? Actually, I heard about Finance Alliance through [LinkedIn](https://www.linkedin.com/company/73979524/admin/feed/posts/) and when I did my research about it, I found it helpful for my career development and finding solutions to my problems. The main motivation behind joining the community was the interaction with leaders of the finance profession. I also wanted to update my knowledge and skills through the stories being shared and through insights shared by the community members. ### What have you enjoyed most since joining? Even though I am new here, I have interacted with many community members. The variation and quality of feedback shared by the Finance Alliance community is fascinating and interesting. I love the number of options available to ask questions and get good responses. I also enjoy reading the stories of CFOs and other topics like [ways to identify the cost drivers](https://www.financealliance.io/cash-flow-drivers-in-a-business/), etc. ### What type of discussions have you found the most insightful and useful? I find the financial software solutions and the [financial modelling](https://www.financealliance.io/build-a-saas-financial-model/) discussions more insightful within this community. --- [Case Study | Finance Community“This vibrant community offers an exceptional opportunity and platform for cultivating meaningful relationships, sharing insights, and fostering collaborative growth within the finance realm.”![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/Copy-of-FA_Case_Study_Template-3.png)](https://www.financealliance.io/valerius-case-study-slack-community/) --- ### What type of resources have you found the most helpful? Honestly, details about different topics of daily use for finance professionals, like how to manage cost drivers, financial analysis, the role of the CFO, and others have been so helpful. I use this community's resources to help improve my knowledge and grow my career toward the career stage where I will become a CFO, as I am learning about how to be a good CFO and what is expected from them in today's market. ### How has the community impacted your professional growth? I get a lot of knowledge and I use the community on a daily basis, so it's helping me grow professionally. ### How would you describe the culture of the community? It's good. I love the culture and the platform both. The culture of Finance Alliance is one of collaboration, support, and learning. The community is welcoming and inclusive. ### How do you see the value of this community in comparison to other professional networks you're part of? I find this community helpful, I have not joined any other such community to date. --- [“It was outstanding, the topics were very interesting.” - Ahmed MorsyWe recently wrapped up another exciting FP&A Summit and this time, it was a virtual event, which meant lots of different finance professionals from around the world attended.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/ahmed.png)](https://www.financealliance.io/virtual-event-case-study-ahmed-morsy/) --- ### Why should other finance professionals join our community? It's a great platform for finance professionals and somewhere they can find knowledge and support from others using this platform. I have learned a lot and it has helped me grow professionally. I think every finance professional must join to keep updated with the industry and expand their knowledge. However, it's not just about improving knowledge. I have also gained many professional insights into my career and I'm able to develop skills to perform finance-related tasks more easily and with good understanding. ### About Saleem Saleem Noor is an ACCA-qualified accountant with over five years of experience in accounting, finance, auditing, and planning. He is a highly skilled and experienced professional with a proven track record of success in a variety of roles. Saleem has a strong understanding of financial reporting, taxation, and auditing. He is also proficient in financial modelling and analysis. He is a strategic thinker with the ability to develop and implement sound financial plans. Saleem is a team player with excellent communication and interpersonal skills. He is also a highly motivated and results-oriented individual. He's very passionate about using his skills and experience to help businesses succeed. He is always looking for new challenges and opportunities to learn and grow. --- ### Join our finance community (it's free!) Ready to power-boost your career and take it to new heights? Then don't wait any longer! [Join our community](https://www.financealliance.io/community/) of finance professionals and start networking with brilliant, like-minded professionals, benchmark your methods against the best, give a fresh, invigorating touch to your strategies, and kickstart your journey toward phenomenal career growth. [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg)](https://www.financealliance.io/community/) ### Invest in your well-being: A CFO's strategy for peak performance URL: https://www.financealliance.io/invest-in-your-well-being-a-cfos-strategy-for-peak-performance/ Last updated: 2023-11-10T13:51:16.000Z *This article is from a session by Emil Vasilev, VP of Finance at Cherry, who gave this presentation at the Finance Alliance FP&A Summit.* The most important part of everything that we do is our body, our mind, how we feel, how we do things, and what energy levels we experience. And we experience a lot at work in our day-to-day. So how can we manage ourselves effectively? I’m Emil Vasilev, the VP of Finance at Cherry. My background is in private equity and investment banking. I’m originally from Bulgaria, and I live in Los Angeles now. About six months into my first job, which was at Barclays on Wall Street, I experienced serious [burnout](https://www.financealliance.io/how-to-avoid-burnout-as-a-high-growth-cfo/). I was done. I think all of us have had our ups and downs in the working world. What I tried to do in the following year was many things. Most of them didn't work. I found a new job which didn't work because it was even more stressful. I found a new girlfriend - that didn't work either. It didn’t fill the void I’d felt at the time. I tried various healthy and unhealthy ways of dealing with stress and living in New York City in my early 20s. But it wasn't until I learned a set of tools that are normally taught to high-performance athletes, military personnel, and C-level execs that I noticed an actual difference in my life. This is more about the personal and professional merging, and I'd like to share some of these learnings with you all. I've been doing this for about 10 years, and I'll do my best to bring you in on my experience. - [Managing your energy: The key to tackling stress and burnout ](https://www.financealliance.io/p/3696ba30-bdcb-4403-b6d6-00465b668ced/#managing-your-energy-the-key-to-tackling-stress-and-burnout) - [Getting enough quality sleep](https://www.financealliance.io/p/3696ba30-bdcb-4403-b6d6-00465b668ced/#getting-enough-quality-sleep) - [Getting enough nutrition](https://www.financealliance.io/p/3696ba30-bdcb-4403-b6d6-00465b668ced/#getting-enough-nutrition) - [Getting enough calmness](https://www.financealliance.io/p/3696ba30-bdcb-4403-b6d6-00465b668ced/#getting-enough-calmness) - [Getting enough ‘you’ time](https://www.financealliance.io/p/3696ba30-bdcb-4403-b6d6-00465b668ced/#getting-enough-%E2%80%98you%E2%80%99-time) - [Getting enough… breathing!](https://www.financealliance.io/p/3696ba30-bdcb-4403-b6d6-00465b668ced/#getting-enough%E2%80%A6-breathing) - [Practicing an effective breathing technique](https://www.financealliance.io/p/3696ba30-bdcb-4403-b6d6-00465b668ced/#practicing-an-effective-breathing-technique) - [Shifting your mindset through guided relaxation ](https://www.financealliance.io/p/3696ba30-bdcb-4403-b6d6-00465b668ced/#shifting-your-mindset-through-guided-relaxation) - [Mindful practices transform company culture](https://www.financealliance.io/p/3696ba30-bdcb-4403-b6d6-00465b668ced/#mindful-practices-transform-company-culture) ## Managing your energy: The key to tackling stress and burnout The first thing these frameworks start with is energy management. Just think about a time when you've been really low energy. How do you feel? What kind of emotions come up? You're down, you're sad, you’re depressed. Life is horrible. Then think of a time when your energy was very high. How do you feel when emotions come up then? You're feeling great, there’s enthusiasm, there’s zeal. So, when we get asked to do something after a long day and our energy is very low, and we’re feeling low, what’s our natural response? You get back from a conference and your boss emails you at 9 PM asking you for something urgent the same day. What's your mental attitude? Are you kidding me? Right now? And on the flip side, what’s the mental attitude when we're high energy and something comes up? It's a non-issue. We just take care of it, even if it's something big. I have no idea how I'm going to do this, but I'll get through it. I'll get it done. The enthusiasm, the valor, and the zeal are there. The only difference between those two things is the amount of energy that we have. So, how do we typically get our energy? What are the main sources of energy that we use in our day-to-day lives? Food and sleep, different kinds of nutrition, exercise, caffeine, sunlight. I'll group them into four main buckets. When I think to myself, Okay, how am I feeling? Or something isn’t right, I think, Which one of these four things is off? And we know these, by the way. This isn’t [AI](https://www.financealliance.io/exploring-the-transformative-power-of-ai-in-finance/). This is stuff that we know in our daily lives but forget about. So the basics… --- [Finance Alliance Tools of Choice Report 2023Our ultimate directory of finance tools is here, bringing you the best tools and software of 2023 that finance pros swear by.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/FA_Tools_of_choice_Suvery_Blog_Meta_2.png)](https://www.financealliance.io/finance-alliance-tools-of-choice-report-2023/) --- ## Getting enough quality sleep We know this, and we don't do it oftentimes. How do we feel when we don't get enough sleep? Grumpy. How do we feel when we get too much sleep? Groggy. The right quantity of sleep is important, and for most people that’s six to eight hours. That's the basics. If you want to optimize further, we can think about the timings of sleep. Modern neuroscience tells us that 10 PM to 2 AM is the most valuable window where we typically get the deepest sleep, and our body and brain get to revive themselves and rejuvenate. So, really optimize against that. Going to bed a little earlier and waking up earlier can make a huge difference. ## Getting enough nutrition Then, people mentioned food and drink. How do we feel after a heavy lunch versus something more life-supporting? It’s also about where the food comes from. All these things that we, especially here in California, are super aware of. Nutritious food versus fast food, things like that can make a huge difference in our state of mind or mood, etc. ## Getting enough calmness Then we have a category that I’d call a calm, collected state of mind. So that's the third. And within that, we can place different things. We can place working out, where the body moves, but also the mind gets refreshed. We get purified. I looked at some stats recently that showed most people work out for [mental health](https://www.financealliance.io/why-leading-cfos-prioritize-employees-mental-health-at-work/). They're not working out for a specific, visual, outside result, they're working out to clear their mind and feel good. ## Getting enough ‘you’ time An easy way to think about it is just to remember a time that you spent with someone who was complaining to you for an hour. How do you feel after that? Drained? Tired? Your body hasn't moved physically, but you somehow feel tired. The reverse of that is listening to an uplifting talk, spending time with family, or doing a hobby. These things can actually be a tangible source of energy for us. ## Getting enough… breathing! Then the last thing is the breath. The breath is usually overlooked. We breathe all the time, but we don't think about it. How long can you last without food? Probably a couple of weeks. It depends on how kept up you are. How about without sleep? A couple of days, maybe longer. Without breath, most of us can only last a couple of minutes. Breath can be this link between the tangible world outside and the less tangible world inside. The world of emotions, the world of state of mind, the world of thoughts. And it can be that bridge between them. Why is it so important? Why is energy so important? We’ve talked about how we feel when we're low or high. And then if you think about it, that state of mind dictates the quality of our lives. Have you observed that? Just imagine you have everything you want; an amazing job, a great family, properties everywhere, a lot of money, etc. But if your state of mind is irritated and impatient, and you're constantly thinking, Am I losing money in the market right now? Even if you have 600 million, how’s that going to feel? Is this going to be a pleasant life? A good life? Probably not. This was a critical insight: if I can manage my energy levels, I can manage my state of mind, and my whole life. --- [11 networking in finance tips: Building your circleNetworking in finance isn’t just about exchanging business cards and talking about the latest stock market trends. It’s about forging genuine connections and positioning yourself in a web of professionals who share insights, opportunities, and wisdom.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/networking-finance-1.png)](https://www.financealliance.io/11-networking-in-finance-tips/) --- ## Practicing an effective breathing technique Would you like to know a secret about the breath? With every emotion we experience, there’s a corresponding rhythm of breath associated with it. A very particular one. Just think about a situation where you've been angered or someone around you has been angry. What was their breath like? Most likely fast, quick, shallow, and choppy. How about when you're on a beach somewhere relaxing, just on vacation? Slow, steady, barely noticeable, very subtle. When you come home from a long day and you sit on the couch, what's the breath like? It's like a long exhale of relief. So, we can use this relationship to our advantage, and we can inverse this relationship. By changing the way we breathe, we can actually change our state of mind. We can actually manage how we feel and manage our emotions. Isn't that cool? So let's experience it, shall we? This is a fun breathing technique. Let's do it together and not worry about feeling silly. Sit with your spine straight. You can sit at the edge of a chair. People call this different names. Bellows Breath is one. A bellows is the thing that you use to make a fire bigger. People call it Yogic Coffee as well. But we can do it together and do a quick 5-10 minute guided relaxation. - Breathe in and out through the nose. - Lift your hands up above your head, and then let go and collapse them back into loose fists. Do three rounds of 15 to 20 reps each. You can close your eyes. Just be with the experience and see how you feel after. Sit with your spine straight. Close your eyes, transition breath in through both nostrils… and then out. Keep repeating it, and then relax. Keeping the attention inward, just relax and observe what's happening on the inside. Keeping the eyes closed, let’s do the second round. Loose fist by the shoulders, spine is straight, chin is untucked. Transition breath in… and out. And then relax. Relax the hands. Slow down. Attention inward. Right, final round. Hands in position and loose fists by the shoulders. Remember on the way up, open your palms, and on the way down, collapse them into loose fists. Transition breath in… and out. And relax. Let's sit easily and comfortably. Attention inward. Eyes closed. Just observe your energy level now. Observe your state of mind now, as compared to a couple of minutes ago. --- [How to become a virtual CFO | Finance AllianceImagine having the opportunity to use your financial expertise to guide businesses globally, from the comfort of your home or any remote location (sunny beach in the Caribbean, anyone?). As a Virtual CFO or ‘vCFO’, you can do just that.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/how-to-become-a-virtual-cfo-2.jpg)](https://www.financealliance.io/how-to-become-a-virtual-cfo/) --- ## Shifting your mindset through guided relaxation We’ll do the guided relaxation now. Let's take a normal breath in… and out. Become aware of your environment, the room, any music, any background noise. Don’t resist the noises, be in harmony with them. You're now in harmony with the environment. Take a deep breath in, and out. Become aware of your physical body, your legs and feet, thighs, abdomen, stomach, chest, shoulders, neck, throat, head, and face. Become aware of your whole body. Let's take a deep breath in, and out. Become aware of your thoughts. Good thoughts or bad thoughts. Just let them come. Don’t resist your thoughts, be in harmony with them. Become aware of your feelings, pleasant feelings or unpleasant feelings. Don’t resist your feelings. You are peace. You are joy. Become aware of your feelings, become aware of your thoughts. Become aware of your body. Become aware of your surroundings. Let's take a deep breath in… and out. Then another deep breath in… and out. And then whenever you feel ready, you can open your eyes. So, how was that? Good? Only a couple of minutes of breathing and a few minutes of relaxation meditation can really shift things. ## Mindful practices transform company culture How is your state of mind now? Probably more collected and calm. Imagine living life in this space. Imagine making decisions, working, and getting things done from this space. And then think about, what if all the people around you were living their lives from this space? It’d be different. It wouldn't be a small step. It’d be a giant leap. In my former company, two-thirds of the people learned these kinds of practices in a longer seminar that we did over a couple of days, a couple of hours each day, and it was transformative. It stuck with people. It was taught by an organization called the TLEX Institute. They don't pay me to do any of this. I'm just sharing it. I hope you enjoyed the session, and I hope you have a wonderful day. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### Forecasting growth to extend runway: Start-up success story URL: https://www.financealliance.io/forecasting-growth-to-extend-runway-start-up-success-story/ Last updated: 2023-11-09T16:34:15.000Z As a venture-backed start-up, we raise money with the expectation of reaching certain milestones in X amount of months. As such, managing expenses couldn’t be more critical. The minute the cash hits the bank, there’s a set timer, a death sentence until the company runs out of money. You raise that money on a plan, but….since when do things go according to plan? Every adjustment or change could significantly impact how long you survive. In the first few months, you quickly learn what’s going well, what’s going great, and what’s going terribly. You double down on the things that are going great and you then continue to place other bets. But everything requires someone at the company to do something. And…headcount is extremely expensive. With so many unknowns, the unique challenge for any startup is forecasting organizational growth for the next two to three years amidst the clamor of hiring requests from various department heads. Our objective was clear: to develop a model that could accurately predict headcount needs over time, thereby providing a realistic picture of our future costs and informing our next [fundraising](https://www.financealliance.io/how-to-effectively-fundraise-and-find-investors/) timeline. ## Balancing immediate hiring requests with long-term financial projections Post-funding, the leadership team sent us their "wish lists" of all the roles they wanted to hire for in the next few months. While understanding their immediate needs was manageable, being able to project them over the next 2-3 years is what became tricky. Without a clear understanding of what was driving the need for headcount in the long-term, forecasting these expenses was almost impossible. This uncertainty severely impaired our ability to plan effectively for the future. Essentially, we didn’t know how long our money would last us since we were only confident in the [forecast](https://www.financealliance.io/rolling-forecast-best-practices/) for up to three months. --- [How to improve sales forecast accuracy | Finance AllianceWhile perfect predictions may not be possible, increased accuracy is within reach. The key is blending quantitative data with qualitative insights to get a complete picture. Aim for reasonable precision, not perfection.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/how-to-improve-sales-forecast-accuracy-2.jpg)](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) --- ## Projecting headcount growth through collaborative forecasting We initiated a process of collaborative forecasting by engaging with every business leader to understand the drivers behind their hiring needs. Different departments had different drivers for headcount requirements. For instance: - **Sales**: Driven by quotas. - **Recruiting**: Based on the number of open requisitions. - **IT**: Determined by the total number of employees. - **HR**: Driven by employee count. - **Customer support**: Determined by customer count. The insights gleaned from these interactions were utilized to develop a unified model to project headcount growth across the organization. So, instead of throwing random headcount in a model throughout a year, we relied on these [metrics](https://www.financealliance.io/infographic-financial-performance-metrics/) to tell us when a new head should be added to the plan. --- [Rolling forecast best practices | Finance AllianceA rolling forecast formula is a straightforward concept. For every period that passes, a new one is added to the end of the forecast…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/rolling-forecast-best-practices-2.jpg)](https://www.financealliance.io/rolling-forecast-best-practices/) --- ## Analyzing headcount drivers to extend runway As [budget](https://www.financealliance.io/3-key-pain-points-in-budgeting/) seasons rolled around, discussions with department heads evolved from merely reviewing wish-lists to evaluating the assumptions driving their headcount projections. For example, we met with the head of customer support and agreed that he could get one rep for every 500 accounts. We also learned that different sized accounts required different amounts of attention. The ratio needed additional specificity that included time to resolution and the type of customer. As we adjusted the ratios, we learned more about that department and better ways to track their performance. New resource requests were now analyzed in the context of their impact on headcount assumptions. For example, if recruiting proposed a new applicant tracking system (ATS) to improve efficiency, the discussion would center around how this would affect their ability to handle more open requisitions. By shifting the focus from approving headcount to analyzing headcount drivers, we significantly enhanced operational efficiency and kept our headcount growth under control. This approach fostered a culture of informed decision-making, ensuring resources were allocated based on a thorough understanding of underlying needs and long-term implications. Ultimately, the improved visibility into future costs extended our [runway](https://www.financealliance.io/7-ways-founders-can-extend-their-cash-runway/), thereby providing a solid foundation for planning our next fundraising endeavor. Our approach could be benchmarked against industry standards for operational efficiency and cost management. Adopting a culture of continuous improvement and learning from industry benchmarks, we continually refined our model to stay aligned with our evolving organizational needs. This structured approach, based on collaborative [forecasting](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/), customized metrics, and iterative evaluations, not only aided in extending our runway, but also ingrained a culture of informed decision-making within the organization. It underscored the importance of understanding the dynamics driving headcount needs across different departments and paved the way for a sustainable growth trajectory. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### 11 networking in finance tips: Building your circle URL: https://www.financealliance.io/11-networking-in-finance-tips/ Last updated: 2025-10-23T09:04:26.000Z > *“Your network is your net worth." - Porter Gale* Networking in finance isn't just about exchanging business cards and talking about the latest stock market trends. It’s about forging genuine **connections** and positioning yourself in a web of professionals who share **insights**, **opportunities**, and **wisdom**. It's a strategic move that can: - Unlock new job opportunities - Offer smart career advice - Highlight industry trends - Share expert tips - Be a source of steady support To put yourself at the forefront of new opportunities, simply having a polished resume or a keen understanding of the market isn’t enough. Networking in finance, with its power to bridge you to industry leaders, innovators, and decision-makers, can be the *key* differentiator you need to stand out. Remember – The edge doesn't come from *what* you know, but rather from ***who*** you know. With that being said, let’s dive into some of the best networking tips to help you **build your circle** in finance.👇🏼 #### Table of contents 1. [Build your network organically](https://www.financealliance.io/p/a0e4b18f-bb17-4611-a8cf-783c62306ecc/#1-build-your-network-organically) 2. [Leverage LinkedIn](https://www.financealliance.io/p/a0e4b18f-bb17-4611-a8cf-783c62306ecc/#2-leverage-linkedin) 3. [Attend finance networking events](https://www.financealliance.io/p/a0e4b18f-bb17-4611-a8cf-783c62306ecc/#3-attend-finance-networking-events) 4. [Volunteer your time](https://www.financealliance.io/p/a0e4b18f-bb17-4611-a8cf-783c62306ecc/#4-volunteer-your-time) 5. [Join an online community](https://www.financealliance.io/p/a0e4b18f-bb17-4611-a8cf-783c62306ecc/#5-join-an-online-community) 6. [Seek out mentors and be one](https://www.financealliance.io/p/a0e4b18f-bb17-4611-a8cf-783c62306ecc/#6-seek-out-mentors-and-be-one) 7. [Cold outreach](https://www.financealliance.io/p/a0e4b18f-bb17-4611-a8cf-783c62306ecc/#7-cold-outreach) 8. [Attend alumni and graduate events](https://www.financealliance.io/p/a0e4b18f-bb17-4611-a8cf-783c62306ecc/#8-attend-alumni-and-graduate-events) 9. [Share your expertise with others](https://www.financealliance.io/p/a0e4b18f-bb17-4611-a8cf-783c62306ecc/#9-share-your-expertise-with-others) 10. [Get involved in your community](https://www.financealliance.io/p/a0e4b18f-bb17-4611-a8cf-783c62306ecc/#10-get-involved-in-your-community) 11. [Leverage personal relationships](https://www.financealliance.io/p/a0e4b18f-bb17-4611-a8cf-783c62306ecc/#11-leverage-personal-relationships) ## **1\. Build your network organically** The most effective networking happens naturally through authentic conversations and shared interests. So, try your best to avoid transactional networking where you're solely focused on what the other person can do for you. Build genuine relationships by being curious about the other person, asking thoughtful questions, and listening intently. 💡 ****Reminder**: People are more likely to ****connect** and assist those whom they **know*, **like*, and **trust*. --- ## **2\. Leverage LinkedIn** [LinkedIn](https://www.linkedin.com/company/73979524/admin/feed/posts/) is a goldmine for expanding your professional network. Beyond your first-degree connections, look to second and third-degree connections for new opportunities. For example, you likely know people who are connected to decision-makers at your dream company. Reach out and ask your contact for an introduction. You can also connect with new contacts by engaging in LinkedIn Groups (*such as our free* [*FP&A group*](https://www.linkedin.com/groups/2102983/) *with 100K members*) related to your field. Share advice and build rapport through contributing regularly. --- ## **3\. Attend finance networking events** Look for annual conferences for finance professionals, as well as seminars, happy hours, or other events to mingle with professionals in your field. Come prepared with business cards and a short elevator pitch that summarizes who you are and what you're looking for. When attending networking events, make an effort to introduce yourself to attendees and ask what brings them to the event. Collect their business card so you can connect afterwards. > Following up is *key* \- review your notes, connect on LinkedIn, and send a friendly email to keep the relationship going. We host both in-person finance conferences and events (and virtual events) featuring world-class speakers talking about the most pressing topics in finance. You’ll also have the chance to network with like-minded finance professionals, and it’s a great way to build your circle while learning simultaneously. Find out more about our upcoming [finance conferences and events here](https://events.financealliance.io/?%5Fgl=1%2A1wbf8lj%2A%5Fga%2AMTc4ODQ0NzE1LjE2OTUxMTc2OTU.%2A%5Fga%5F2NXFSBEP4N%2AMTY5ODE0MjM4Ny41OS4xLjE2OTgxNDM2NTEuMC4wLjA.). --- ## **4\. Volunteer your time** Volunteering allows you to meet like-minded professionals willing to use their skills for a good cause. Look for volunteer activities that align with your expertise - helping with taxes, financial literacy, or fundraising events. Excellent networking finance opportunities often emerge from these experiences. Non-profit board service also provides exposure to community leaders running organizations. Use volunteering to increase your visibility and demonstrate your abilities beyond just a resume. --- ## **5\. Join an online community** Finance Alliance offers a free [Slack community](https://www.financealliance.io/community/) where finance professionals can network and collaborate online. Introduce yourself in the #introductions channel and enjoy thought-provoking conversations within our engaged networking group. Chat with global peers, share knowledge, and make connections *without* leaving your desk. Virtual networking expands your reach 24/7\. Active members tend to gain the most visibility and referrals - so don't be shy! --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) --- ## **6\. Seek out mentors and be one** Having a mentor in the finance industry can provide invaluable insights, guidance, and introductions. Look for experienced professionals who've been where you want to go and are willing to share their journey. Conversely, offer to mentor those newer to the field. The reciprocal relationship can result in fresh perspectives, and as they say, teaching is the best way to learn. --- ## **7\. Cold outreach** Cold emailing or calling finance professionals can feel intimidating. But it's an effective way to introduce yourself and request informational interviews. Do your research beforehand on the person and their company. Personalize the message highlighting why you'd value meeting them. If there's no response, follow up once more. Persistence pays off. Even a 15–30-minute coffee chat gives you a chance to make a positive impression. The more cold outreach you do, the more opportunities will arise. --- ## **8\. Attend alumni and graduate events** Most colleges and business schools host regional alumni events and networking nights. Attend these activities to connect with graduates working in your field. Chat with alumni about their career journey and ask their advice. Share your experience since graduating and where you'd like to take your career next. And don't forget to swap business cards and connect on LinkedIn afterward. --- ## **9\. Share your expertise with others** There are many ways to establish your authority by sharing your expertise. Consider speaking at industry conferences or universities. Or, if you're not camera (or mic) shy, think about starting a podcast or YouTube channel diving into financial topics. > Optimizing your knowledge gives you credibility and exposure to new contacts. Earning a speaking slot at a Finance Alliance conference or leading a virtual workshop is an effective way to increase your professional exposure. [Submit your proposal here](https://www.financealliance.io/call-for-speakers-finance-alliance/). You could also share your expertise by [contributing an article to Finance Alliance](https://www.financealliance.io/create-contribute/) to help showcase your thought leadership. Our online library of member-written pieces covers trending topics and best practices in FP&A, finance transformation, business partnership, CFO leadership, and more. Sharing your expertise through Finance Alliance is a win-win networking opportunity. You establish your credibility while making new connections. --- ## **10\. Get involved in your community** Volunteering locally helps you meet professionals and influencers outside the corporate walls. Local non-profit boards also offer great networking exposure while benefiting a good cause. Help out with community events or join the planning committee for finance-related activities. Being proactively involved raises your visibility as a leader in the field. --- ## **11\. Leverage personal relationships** Don't underestimate networking with your own family and friends. You never know who someone might know until you have a conversation. Ask your contacts if they can make professional introductions on your behalf. Referrals often carry more weight than a cold approach. Warm introductions from mutual connections are the most powerful lead source according to many finance recruiters and hiring managers. --- ## **Quick fire tips: How to network in finance** ### 📋 **Come prepared** Bring plenty of business cards and refine your elevator pitch - a quick summary of your background and goals. Rehearse your pitch so you can confidently share it during introductions. 💡 ****Tip:** Research attendees beforehand so you can ask informed questions about their experience. Having context makes networking conversations more meaningful. ### 💎 **Focus on giving value** Look for ways to help others without expecting anything in immediate return. Make introductions between your contacts that make sense. Share an interesting article or job opening suited to someone's interests. Establish your reputation as a connector who wants to see everyone succeed. Your generosity will be remembered. ### ⏰ **Follow up promptly** After meeting someone new, send them a LinkedIn connect request and a brief email that same day. Quick follow-up shows you were engaged and interested in connecting further. 💡 ****Tip:** Include a recap of your conversation, an article they may find interesting, or suggestions for staying in touch. Don't let new contacts fall through the cracks. ### **🎯 Set networking goals** Approach networking with purpose. Set goals like "connect with five new professionals in my field" or "attend three industry events this quarter." Track your progress to stay motivated and on track. Consistency is key to building an impactful network over time. ### 👂 **Listen more than you speak** Resist the urge to self-promote. Instead, spend most of your time listening and learning from others. Ask engaging questions about their career journey and interests. People appreciate being heard. You'll gain key insights by focusing on their perspectives and advice. ### 🌟 **Stay authentic** Don't try to be someone you're not. Networking is about developing genuine connections, not impressing others. Share your real passions, interests, and story. Relax, be yourself, and seek out like-minded professionals. Your authenticity will shine through. 💡 Networking effectively is a long game that requires persistence, follow up and reciprocity. With a little practice, you'll be expanding your circle and unlocking new career opportunities in no time. --- ## **Conclusion** Networking in finance can feel daunting, but it doesn't have to be. By putting in consistent effort over time, you can gradually build a powerful circle of mutually beneficial relationships. Start with the connections already in your orbit and work outward. Attend events, ask for informational interviews, contribute your expertise, and stay engaged with your growing network. Focus on giving first and developing genuine rapport. So get out there - online and in person - and start meeting the mentors, peers, and decision-makers who will shape your future. Through the simple act of networking finance, *anything* is possible. --- ### FAQs: Networking finance What does networking mean in finance? Networking in finance entails building connections with industry professionals to share insights, seek advice, and explore mutual opportunities for career or business advancement. What is the power of networking in finance? Networking in finance opens doors to hidden job opportunities, offers early insights into market trends, fosters business collaborations, and provides a platform for shared knowledge and experiences. How important is networking in finance? Networking is crucial in finance as it not only offers access to job openings but also keeps professionals updated on industry trends, enables partnerships, and solidifies one's position in the financial community. I’m new to the finance sector. How do I start networking? Begin with attending conferences for finance professionals, joining online platforms like LinkedIn, participating in local finance seminars, and connecting with alumni from your educational institution. How can I use LinkedIn effectively for networking finance? Start by optimizing your profile with a professional photo and comprehensive details about your experience. Engage in relevant groups, post regularly about finance topics, and proactively connect with industry professionals, both within and outside your direct network. How often should I attend finance networking events? While there's no set number, it's beneficial to attend several events throughout the year. This keeps you updated, ensures regular touchpoints with contacts, and allows you to meet new professionals in the industry. Can I network even if I'm not actively seeking a new job? Definitely! Networking isn't just about job-seeking. It's about building and maintaining relationships, learning, and growing professionally. How do I handle rejection or lack of interest from potential contacts? Stay gracious and professional. Not every interaction will lead to a meaningful connection, and that's okay. Focus on building quality relationships rather than quantity. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### How color impacts your finance presentations URL: https://www.financealliance.io/how-color-impacts-your-finance-presentations/ Last updated: 2023-11-01T16:34:45.000Z Color is an incredibly powerful tool in [data storytelling](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/), capable of evoking emotions, drawing attention, and communicating complex information quickly and effectively. When used right, color can help viewers differentiate between different data points and highlight key insights. By using different hues, shades, and tones, you can create visual hierarchies that [make it easier for viewers to understand data](https://www.financealliance.io/storytelling-with-data-visualization/) at a glance. For example, using bright colors to highlight important data points can help draw the viewer’s attention to critical information, while more muted colors can help balance the composition and make the visualization easier to read. - Color selection: Which colors work best? - The psychology of color in data visualizations - Colors and emotions - 7 tips for using color in your data visualizations ## **Color selection: Which colors work best?** When it comes to color selection, it’s essential to choose colors that work well together and don’t clash. Color combinations on opposite sides of the color wheel complement each other, such as blue and orange, which tend to work well together and can create an appealing visual contrast. Others, like red and green or purple and yellow, can clash and make it difficult for viewers to distinguish between different data points. Here’s an example of how some colors work well together and others tend to clash: ![Color chart](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/10/Screenshot-2023-10-18-at-15.31.00.png) ## The psychology of color in data visualizations Good data visualization isn’t just about choosing colors that look good together – it’s also about considering the cultural and emotional associations that different colors can evoke. For example, red is often associated with danger or excitement, while blue evokes a sense of trustworthiness and stability. Understanding these associations can help you reinforce your message and create a more impactful visualization. --- ### Colors and emotions: **Red:** Often associated with excitement, passion, and danger, red can be a good choice for highlighting important information or drawing attention to key insights. However, overusing red can be overwhelming, so it’s best used sparingly. **Blue:** Tends to evoke feelings of trustworthiness, stability, and calmness, blue is a versatile color that can work well in a variety of data visuals. It’s also easy on the eyes, making it a good choice for longer presentations or reports. **Green:** Commonly linked with growth, prosperity, and balance, green is a good choice for financial data visualizations. It can also be calming, making it a good choice for visuals or presentations that require a lot of detail. **Yellow:** Universally tied with happiness, optimism, and energy, yellow is perfect for highlighting important data points. **Orange:** Usually connected with enthusiasm, creativity, and warmth, orange is great for increasing energy or excitement. It’s also ideal for highlighting key insights. **Purple:** Traditionally paired with luxury, creativity, and sophistication, purple gives the impression of elegance. However, it’s another color that can be overwhelming if used too much, so just make sure to use it sparingly. **Gray:** Generally tied to neutrality, formality, and professionalism, gray can help create a balanced and professional-looking visualization. It can also help highlight other colors and create contrast. --- ## **7 tips for using color in your data visualizations** ### 1\. Highlight key insights Use color to draw attention to important data points or trends that you want your audience to focus on. This will help you make your message more impactful and memorable. ### 2\. Contrast is key Choose contrasting colors to differentiate between different categories or segments in your visualization. This will help ensure your audience can quickly and easily understand the information you’re presenting. ### 3\. Consider accessibility Keep in mind that not all viewers may be able to see colors the same way. Consider using color-blind-friendly palettes to ensure that everyone can access the information in your visualization. ### 4\. Keep it simple Limit the number of colors you use to avoid overwhelming your audience. Stick to a few key colors that work well together and complement your data. ### 5\. Purposeful color choices Be purposeful with your color choices. Consider the cultural and emotional associations of different colors when selecting them for your visualization. ### 6\. Consistent color scheme Use a consistent color scheme throughout your visualization to create a cohesive and professional look. ### 7\. Create a visual hierarchy Use color to create visual hierarchies that make it [easy for viewers to understand the data at a glance](https://www.financealliance.io/financial-charts-and-graphs/). For example, you could use a bright color to highlight a key data point and a more muted color for supporting data. --- > *“You can use generally accepted colors that lead to a “normal” emotional response like green for positive or red for negative.* > *“Another important element that I always enforce when training teams is to use the company’s color palette and not the standard Excel colors.* > *“It will show your business implication, people will recognize them and feel more confident and it will be standardized.* > *“A last important point regarding colors is to make sure to cover for color blind people and replace green by blue and red by orange/yellow.” *\- Soufyan Hamid, Finance Presentations Coach at SouFBP** --- ## Discover the essential components of storytelling with data visualization Are you tired of presenting financial data that falls flat? Frustrated that your insights are lost in a sea of numbers and charts? Worry no more! We've created the **ultimate playbook** to help you transform your financial data into captivating, persuasive stories. [Download the playbook](https://www.financealliance.io/storytelling-with-data-visualization/) ### AI in Finance eBook URL: https://www.financealliance.io/ai-in-finance-ebook-download/ Last updated: 2025-04-04T14:37:51.000Z Artificial Intelligence (AI) is reshaping the finance industry and empowering finance teams to make smarter, data-driven decisions like never before. But how can you incorporate AI into *your* financial workflow? Welcome to the **AI in Finance** eBook, your trusted guide to merging AI’s vast potential with everyday finance operations such as forecasting, budgeting, analysis, and more. ### What's inside? Dive into our free guide to unlock the immense power of AI in finance and get ready to: **🤖** Explore the world of AI and its applications in FP&A and other areas of finance. **🦾** Tackle the main hurdles of AI integration. 💡Steps to successfully implement AI in your role. 🧠 Get skilled with top AI tools like ChatGPT and others. ... and more. ### Are you ready for this new era of finance? Grab your copy today and learn how to use AI to transform mountains of data into practical insights within seconds, predict market trends with precision, and redefine your decision-making process. What are you waiting for? 👇 ### Exploring the transformative power of AI in finance URL: https://www.financealliance.io/exploring-the-transformative-power-of-ai-in-finance/ Last updated: 2025-10-01T12:04:40.000Z In today’s digitally driven world, finance businesses are dealing with the challenges of managing enormous data sets whilst also having to meet increasing demands for more efficient services. Fortunately, there is a game-changing solution helping finance to overcome these obstacles: Artificial intelligence (AI). From streamlining operations to reducing errors, AI ensures finance and accounting institutions stay agile and ahead of the competition. As a result, AI is being adopted by more and more finance businesses. According to [Grand View Research](https://www.grandviewresearch.com/industry-analysis/artificial-intelligence-in-fintech-market-report), the global AI in fintech market size is expected to grow 16.5% by 2030\. With all this in mind, we’re diving deep into the applications of AI in finance. In this article, we’ll be discussing: - [What is AI?](https://www.financealliance.io/p/84586a9f-e0dd-4bf8-9255-d7c7dedc1041/#what-is-ai) - [What is AI in finance?](https://www.financealliance.io/p/84586a9f-e0dd-4bf8-9255-d7c7dedc1041/#what-is-ai-in-finance) - [The key benefits of using AI in finance](https://www.financealliance.io/p/84586a9f-e0dd-4bf8-9255-d7c7dedc1041/#the-key-benefits-of-using-ai-in-finance) - [The potential risks of not adopting AI in finance](https://www.financealliance.io/p/84586a9f-e0dd-4bf8-9255-d7c7dedc1041/#the-potential-risks-of-not-adopting-ai-in-finance) - [6 types of AI technology - and how to use them in finance](https://www.financealliance.io/p/84586a9f-e0dd-4bf8-9255-d7c7dedc1041/#6-types-of-ai-technologyand-how-to-use-them-in-finance) ## What is AI? Artificial intelligence, or AI, is a broad area of computer science. It centers around the creation of intelligent machines capable of performing tasks that typically require human intelligence. It mimics human intelligence processes through the development of algorithms that are built into dynamic computing environments. Typical tasks carried out by AI applications include learning from experience, interpreting complex data, recognizing patterns, drawing inferences, understanding natural language, and making decisions. ## What is AI in finance? AI in finance refers to the application of sophisticated machine learning and data analysis techniques to streamline and optimize financial processes. It plays a vital role in enhancing efficiency, accuracy, and decision-making for the industry. AI lessens the need for manual tasks like sorting through mountains of data. In fact, AI has the capability to analyze and interpret large volumes of complex financial information in just minutes, leading to quicker, more accurate predictions and market analyses. AI can be leveraged in many areas of finance, including risk management, fraud detection, predictions and forecasting, performance measurement, trading, customer service, investing, real-time calculations, intelligent data retrieval, and more. ## The key benefits of using AI in finance There are multiple benefits of using AI in finance and accounting. However, these can be boiled down to three key advantages: increased productivity, accuracy, and business value. Let’s take a closer look at these three areas: ### 1\. Productivity - **Faster analysis**: AI can process vast volumes of data at unparalleled speeds, spotting patterns, trends, and anomalies for more informed and efficient decision-making. - **Automated tasks:** AI can be used to perform repetitive processes like data entry, reconciliation, report generation, verifying and summarizing documents, and more. This not only speeds up certain processes but also gives finance professionals more time to focus on strategic activities. - **Efficient reporting:** Using AI, finance professionals can drastically reduce the time it takes to produce narrative or statutory reports, accelerating financial reporting cycles as a result. - **Streamlined financial operations:** AI also facilitates quicker generation and auditing of financial statements, and significantly reduces the time needed to complete monthly financial close processes. - **Scalability:** AI systems can easily take on large workloads and transaction volumes without the need for a proportionate increase in the human workforce. ### 2\. Accuracy - **Reduced errors:** Automated processes driven by AI can help reduce human errors in data processing, analytics, calculations, document processing, and other tasks. - **Enhanced forecasting:** By utilizing AI’s predictive capabilities, finance professionals can create more accurate financial forecasts, which ultimately help organizations plan better for the future. - **Risk management:** AI has the power the assess and predict potential risks and security threats. It can continuously monitor transactions and detect unusual patterns or anomalies to protect companies from fraudulent activities and reduce the risk of cyber attacks. - **Consistency:** AI algorithms are able to be more consistent than humans in their work, which can lead to a significant reduction in discrepancies and errors over time. ### 3\. Business value - **Deeper insights:** AI has the ability to provide in-depth insights into business performance, which helps finance professionals understand the main drivers behind business outcomes. - **Profitability**: AI can guide strategic decisions and increase profitability by identifying the most lucrative areas of an organization. It can also help organizations identify market opportunities, which can lead to the development of additional revenue streams in the form of innovative new products and solutions. - **Enhanced decision-making:** AI algorithms can analyze large datasets quickly and in real-time, providing businesses with immediate insights and the ability to make decisions on the fly. - **Cost savings:** By automating routine tasks with AI, businesses can make significant savings in terms of operational costs, as well as avoid potential losses through improved risk management processes. - **Improved customer experience:** AI chatbots and virtual assistants can enhance the customer experience by providing real-time support and responses to queries and guiding customers through financial processes. - **Competitive advantage:** Businesses can gain a significant edge over the competition by adopting the latest AI tools and capabilities to optimize their processes and serve their customers better. --- [How to leverage AI in finance with Christian MartinezIt’s really important to have that buy-in from management. In order to get it, you need to understand the ‘why are we doing this,’ and ‘why this matters.’ The answers will depend on the management and the project, but understanding those is key.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/processor-2217771_1280.jpg)](https://www.financealliance.io/ama-with-christian-martinez-ai-in-finance/) --- ## The potential risks of *not* adopting AI in finance It’s clear that AI is revolutionizing the world of finance, with more and more businesses opting to embrace this innovative technology. While AI can be a costly investment, it’s well worth the money in the long term. By not embracing AI, you could hinder your organization’s growth, and expose it to a number of potential issues. These include: ### Falling behind your competitors As more finance businesses adopt AI to improve their processes and make better decisions, your organization risks being left in the dust, unable to keep up with its technologically advanced competitors. ### Inaccuracy and increased errors Human error is natural in any profession, but in finance, these errors can become costly. AI tools are able to drastically reduce errors in processes such as data entry and complex calculations. They can automate such tasks and generate more accurate and consistent results. ### Reduced productivity Finance professionals tend to spend a significant amount of time on mundane tasks. AI can automate repetitive processes, giving professionals more time to focus on more strategic initiatives. If you’re not using AI, you’re missing out on this opportunity for optimal productivity. ### Enhanced employee satisfaction Those monotonous, mundane tasks can leave employees feeling burned out and unsatisfied with their jobs. As a result, the business may deal with issues in retaining talent. Adopting AI tools means you can keep employees feeling motivated and engaged with more varied and challenging day-to-day responsibilities. ### Limited insights AI has the power to process large amounts of data and generate insightful analysis in real-time. Without it, your finance team might struggle to interpret big datasets, be slower to adapt to evolving market conditions and customer demand, and miss valuable insights that could drive business decisions. Real-time insights are also crucial to avoid inefficient resource allocation. Therefore, AI can help you ensure that funds are appropriately directed toward the most impactful initiatives. ### Increased costs AI can help you implement more efficient processes to reduce operating costs and achieve healthier profit margins. By not embracing AI, you can miss out on these potential savings and waste more time and labor through old-fashioned, manual tasks. ### Inaccurate forecasting You can also generate more accurate financial forecasts through AI. This prevents your finance team from relying so heavily on historical data, which tends to be far less accurate in predicting future performance. Inaccurate forecasts can also cause your stakeholders to lose trust in you. Plus, more accurate forecasts mean that organizations are less exposed to financial risks like cash flow shortages, overspent budgets, and surprise expenses. ### Insufficient fraud detection and prevention With its ability to analyze large datasets, AI can more quickly and accurately identify suspicious patterns and fraudulent activity. Time is money when it comes to your organization’s response to potential fraud, so it’s a good idea to invest in AI in accounting and finance to minimize potential losses and mitigate risk. --- [How to use ChatGPT with PythonEven without deep Python knowledge, you can use ChatGPT to write Python code in a matter of seconds – and in this blog post, we’ll teach you how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/Python-ChatGPT.png)](https://www.financealliance.io/how-to-use-chatgpt-with-python/) --- ## 6 types of AI technology - and how to use them in finance Now we’ll dive into some of the key technologies that are driving the evolution and growth of AI in banking and finance. ### Machine learning (ML) Machine learning is a subset of AI that allows computers to learn from data without being programmed. ML algorithms process the data, recognize patterns, and make decisions based on those patterns. Finance pros can use ML to: - **Enhance decision-making** by making accurate predictions. - **Drive efficiency** by speeding up manual processes and offering real-time solutions. - **Minimize human errors** through more accurate data processing and analysis. - **Reduce workloads** by automating repetitive and time-consuming tasks. - **Improve risk management** by identifying patterns that indicate potential fraud or credit default, flagging them long before traditional methods can. ### Neural networks Neural networks are computational models that are inspired by the human brain. They consist of interconnected layers of nodes or “neurons” that can learn from data, which makes them ideal for carrying out complex tasks. In finance, neural networks can be used to: - Analyze vast amounts of financial data - Predict market trends, forecast stock trends, and exchange rates - Automate and improve trading decisions, and optimize trading strategies - Detect and prevent fraudulent activities and transactions - Monitor compliance with regulations - Predict bankruptcy ### Deep learning Deep learning is a subset of machine learning. It uses neural networks with several layers to model high-level abstractions in data. It excels at recognizing complex patterns in data, including pictures, text, and sounds. It can then use these patterns to generate accurate predictions and insights. You can use deep learning for: - Sentiment analysis of financial news - Predicting market movements based on trends - Automated risk assessment - Algorithmic trading - Credit card research - Customer data management - Detecting security breaches - Processing myriads of transactions in real-time to make quick strategic trading decisions - Maximizing returns and minimizing risk in portfolio management - Analyzing customer behavior ### Natural Language Processing (NLP) Natural language processing (NLP) is an area of AI that’s focused on giving computers the ability to manipulate, decipher, and understand human language in a valuable way. NLP can be used for: - Automating customer service via chatbots - Analyzing customer sentiment - Processing vast amounts of text-based financial data quickly and efficiently. - Streamlining financial reporting and analysis tasks - Performing credibility analysis - Carrying out risk assessments - Portfolio selection and optimization ### Generative AI Generative AI is a type of AI that’s trained to generate new content, such as text, images, and videos. This is often indistinguishable from content created by humans. The most common form of generative AI is a Generative Adversarial Network (GAN), where two neural networks (the “generator” and the “discriminator”) work together to produce a desired output. The generator creates new examples, and the discriminator evaluates them. Then, through a continuous feedback loop, the generator improves its ability to create realistic outputs. Generative AI can: - Automate report generation and accounting functions - Create realistic financial scenarios for testing purposes - Simulate customer interactions for training customer service reps - Develop lifelike simulations of financial markets under different economic conditions - Generate synthetic data for simulating fraudulent patterns - Offer personalized financial advice by leveraging customer data - Create customized investment portfolios - Improve accuracy and efficiency in risk management practices ### Robotic process automation (RPA) Robotic Process Automation (RPA) is a technology that uses software robots or “bots” to automate routine, repetitive tasks like data entry, form filling, invoice processing, or email response. RPA can automate tasks like: - Data entry - Data collection and cleaning - Invoice processing - Regulatory reporting - Transaction processing - Client onboarding - Intercompany reconciliation - Financial planning and forecasting - Accounts payable - Mortgage processing - Know your customer (KYC) --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ## AI is redefining the future of finance Artificial intelligence has triggered a transformational shift in the way that financial businesses operate and serve their clients. Technologies like machine learning, neural networks, and robotic process automation are becoming instrumental in streamlining existing processes and increasing the accuracy of financial tasks. Thanks to AI, companies can quickly analyze vast amounts of data, make better-informed decisions, improve their efficiency, and enhance customer experiences through responsive chatbots and personalized financial advice. As AI becomes increasingly sophisticated, it’s no longer a luxury for finance companies—it's a necessity. Companies must embrace AI technologies in order to maintain a competitive edge and deliver optimal value to customers and stakeholders alike. To reject the adoption of AI in finance means your business could get left behind and potentially become obsolete in an increasingly fast-paced, digital landscape. --- ## FAQs **How important is AI in finance?** AI in finance is incredibly important in order for businesses to maintain a competitive edge. AI is proven to enhance efficiency, improve accuracy, strengthen risk management practices, and provide deeper insights into financial data. **Why is AI the future of finance?** AI is the future of finance because it brings about a number of benefits and opportunities for the industry. It boosts efficiency, improves decision-making, streamlines complex processes, enhances the customer experience through personalized services, and also reduces operational costs. **How does AI work in fintech?** AI is used in fintech in several ways. AI chatbots and virtual assistants are used to speed up service and improve the customer experience, and machine learning algorithms are leveraged in fraud detection to identify suspicious activities. AI can also be utilized to automate financial processes, analyze vast amounts of data, and offer predictive insights. **How is AI used in accounting and finance?** Accounting and finance professionals use AI to automate repetitive, mundane tasks such as data entry, reconciliations, bookkeeping, and invoice processing. This frees up their time to focus on more meaningful, strategic tasks. AI is also used for fraud detection, financial forecasting, budgeting, auditing, and offering personalized financial advice. **Will AI replace financial analysts?** It’s highly unlikely that AI will replace financial analysts. While AI has extensive knowledge and analytical capabilities, humans have the ability to think critically and make decisions based on emotional intelligence, which AI currently can’t replicate. AI isn’t perfect. It has its limitations, can sometimes make mistakes, and doesn’t always interpret data in the right way. --- ### Want to learn more about AI in finance? Download our comprehensive eBook! [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/08/FA_AI_In_Finance_Playbook_CTA.jpg) ](https://www.financealliance.io/ai-in-finance-ebook/) ### Introducing your finalists for the Finance Alliance Awards URL: https://www.financealliance.io/finance-alliance-awards-finalists/ Last updated: 2023-10-11T09:56:12.000Z We’re gearing up to celebrate the unsung heroes in finance for the first ever Finance Alliance Awards, 2023. Thanks so much to the community for your submissions. The financial red carpet is ready, the champagne is on ice and the stage is set for us to spotlight the people revolutionizing the industry. We’ve sifted through the figures and now it’s time to showcase your Finance Award finalists!🥇 ## Finance Leader of the Year 2023 These finance leaders have consistently inspired trust, fostered innovation, and set the golden standard for tackling monetary challenges. They've not only managed to maintain strong relationships with key stakeholders, but they've also seamlessly kept their finger on the pulse of cutting-edge financial strategies. ### The nominees are: - **Christian Martinez**, Finance Analytics Manager at Kraft Heinz. - **Anders Liu-Lindberg**, Partner and CCO at Business Partnering Institute. - **Julio García**, CEO at J&C Financial. - **Manish Gundecha**, Senior Director of Finance Transformation at HP Inc. - **Prakash Shah**, CFO at BUBBL, holistic, Chase Lodge, and Light Initiative. As we eagerly anticipate the winners, it's clear that the finance community is thriving with remarkable talent and innovation. These nominees represent the driving force behind some of the most successful initiatives in the industry, and they've left an indelible mark on the financial landscape. Regardless of who takes home the trophies, all these individuals have shown us what it means to excel in their field. Congratulations to all the nominees, and let's celebrate their contributions to the ever-evolving world of finance! 🏆🌟 The winner will be **announced virtually** on **Nov 15**, so save the date - more details to follow. ### Finance Alliance Tools of Choice Report 2023 URL: https://www.financealliance.io/finance-alliance-tools-of-choice-report-2023/ Last updated: 2024-07-19T13:03:08.000Z **Our ultimate directory of finance tools is here, bringing you the best tools and software of 2023 that finance pros swear by.** We've gathered insights from industry leaders to spotlight the tools finance professionals can’t do without. These aren't just any tools; they've been vetted, tested, and proven effective. For every category, we unpack the fan-favorites, giving you a deep dive into: - **Essentials:** Understand the core purpose of each tool and the reasons finance experts consistently choose it. - **Strengths:** Discover how each tool can seamlessly integrate into your operations, optimizing your financial workflows. - **Investment insights:** Get a clear cost breakdown, helping you make informed budget decisions. Download Finance Alliance’s Tools of Choice 2023 report today.👇 ### How FP&A teams calculate and reduce customer churn URL: https://www.financealliance.io/how-fp-a-teams-calculate-and-reduce-customer-churn/ Last updated: 2025-04-07T10:05:55.000Z What’s more important than acquiring customers? **NOT** losing them (aka churn). Today’s topic is how FP&A teams can calculate and reduce customer churn. This post covers the following: - [Why understanding customer churn is important](https://www.financealliance.io/p/6cd997f8-9941-4c33-88a4-dbf7d7fe86b8/#why-is-customer-churn-important) - [How to calculate customer churn](https://www.financealliance.io/p/6cd997f8-9941-4c33-88a4-dbf7d7fe86b8/#calculating-customer-churn-rate) - [Ways to analyze and reduce churn](https://www.financealliance.io/p/6cd997f8-9941-4c33-88a4-dbf7d7fe86b8/#strategies-to-reduce-churn) You can save your company from losing customers, which makes you a big winner when promotions are given. 🙌 Now, let’s talk about bathtubs. ## What is customer churn? Filling up a bathtub with water is like trying to grow your customer base. Bathtubs take time, effort, and money to fill. But what happens when you try to fill a bathtub and don’t plug the drain? You lose a lot of water. And worse…the bathtub takes FOREVER to fill. Customer churn is like water flowing through an unplugged drain. It happens when customers you worked so hard to acquire decide to say goodbye. Examples of customer churn include: ❌Cancelled contracts ❌Closed accounts ❌Non-renewal of subscriptions Churn makes growth harder, more expensive, and hurts the bottom line. --- [Chief Revenue Officer vs Chief Financial Officer (CRO vs CFO)The CFO oversees accounting, cash flow, and financial planning, while the CRO is laser-focused on driving sales and boosting revenue. But that’s just scratching the surface.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/Chief-Revenue-Officer-vs-Chief-Financial-Officer-2.jpg)](https://www.financealliance.io/chief-revenue-officer-vs-chief-financial-officer/) --- ## Why is customer churn important? Acquiring new customers is expensive and time-consuming. These very reasons are why retaining customers is so important. The longer you keep those customers, the more money you make from them. Don’t waste all that acquisition effort. Customer churn is also a leading indicator of major issues with: - The product you sell - The service you provide - The price you charge - The customer support you offer Fix those issues ASAP and plug that leaky bathtub to accelerate growth. ## Understanding customer churn rate Customer churn rate is the % of customers lost during a certain period. The best companies look at churn monthly and annually, and they track it consistently every single month. How is your customer churn rate trending? Once you have the data at your disposal, it’s critical to investigate the drivers of and reasons behind churn. ## Calculating customer churn rate Investigation requires data to figure out WHO is churning. To calculate the customer churn rate, you need three things: 1. List of active customers at the beginning of the period 2. List of active customers at the end of the period 3. Flag customers that were active at the beginning and not active at the end Let’s fire up the spreadsheet and look at an example below. ### Churn example Start with your list of customers going down and time periods going across as shown below: ![churn example 1](https://lh6.googleusercontent.com/JUV7oydZyk0a62PVrg9M9DmPLg8yzIdgJBdihOPuuvBKR0jrGXsJz8H-bCI2pt0xw7_wkPKTNKUUSdjY9BYstaMnFPEX1sRx_u91d7H9XUX4qN9oax166Vxy3GUuPnr7CYSUwuybbUTnBQLap0rB6gQ) Your company started with 10 active customers and ended with 13\. That’s a change of three. Congrats! Your company grew. 🥳 Now, understand HOW your company grew. Add a column to measure new customers. To do this, count any customers with a “+1” in the change column. ![Add a coloumn to measure new customers](https://lh4.googleusercontent.com/rD27vx1SE-RajoAM6wl4RXjBk9-GqcJg7jkn_NQ-K28stvSbzfix5kjM3_QvHJIu0rLQJM8AhY7l94VRGXspnGr-sw5s68FGBP7FmS6m-SQxS12SCozP8F1ZiwVf715mLFWayqf87E4cWKhFRE-21C4) You added five new customers in the ending period. But why did you only increase the customer count by three? Answer: Churn Add another column to measure churn customers. To do this, count any customers with a “-1” in the change column. ![Measure churn customers](https://lh4.googleusercontent.com/f9ynBFXyAAOaKIxbnfObLafAZlQH7GAXiz_on8Y8G6gvfpgt8eH1NIhPpAOT2iuO6KZNlii4qz_y1Z3MLwuUFAbrpXst4LxWhfav1uukU__hbgUSCHjEkYExAYbWoFlxjK_-C9beWGBTehwdS7FZyqM) You lost two customers to churn out of the original 10. Your customer churn rate is 20%. **Customer churn rate = (2 / 10) = 20%** Let’s find out if that’s good or bad. --- [CapEx vs Opex | Differences, examples, & importanceIf you’re knee-deep in the world of budgeting and financial planning, you’ve probably come across the terms “CapEx” and “OpEx” more times than you can count.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/capex-vs-opex.jpg)](https://www.financealliance.io/capex-vs-opex/) --- ## Interpreting customer churn Customers will churn, it’s a fact of life. To interpret your company’s customer churn, you’ll need to understand a few things. ### Industry benchmarks Every industry is different, so it goes without saying that churn rates will vary. Do you know many people who have terminated their [Microsoft](https://www.financealliance.io/microsoft-fabric-for-data-analysis/) subscription? SaaS companies tend to have lower annual customer churn rates, typically in the single digits. Do you know many people who have joined a gym, quit, and then joined another one? Fitness companies tend to have annual customer churn rates as high as 40-50%. Research your industry’s customer churn rate to understand how you stack up. This info is available on the web. Or just ask ChatGPT. 😉 [Never used ChatGPT? Read this and start using it to save time right now.](https://www.fpandhey.com/how-fpa-can-use-chatgpt-to-save-time/) Then benchmark against your company’s churn rate. ### Track history Is your company’s churn rate improving or getting worse? It’s a critical non-financial metric that should be reviewed consistently. Review customer churn with your customer support team EVERY month. You’ll learn a ton and find ways to materially reduce future churn, i.e. DIRECT impact to the business. Now you’re helping business partners hit essential business goals and marching towards that promotion. ### Identify drivers Build up a robust history of churn customers through your monthly reviews. Now, work to understand WHY those customers are churning. You can create churn categories from this info. Examples of churn reasons include: - Price - Support - Quality - Product/service not needed anymore These categories allow you to take specific actions with your [business partners](https://www.financealliance.io/finance-business-partnering-playbook-2/). Trust us, they’ll love you for it and appreciate you helping them. --- [Finance Business Partnering Playbook | Finance AllianceThe step-by-step guide that takes you from a number cruncher to a strategic business partner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/FA_Finance_Business_Partnering_Playbook_Blog_2-2.png)](https://www.financealliance.io/finance-business-partnering-playbook-2/) --- ## Strategies to reduce churn You can’t go back in time to prevent the churn that happened. But you can look forward. Use information from the past to reduce future churn and improve retention. There’s no shortage of areas you can focus on to plug that leaky bathtub. Think about the products and services you use every day. What makes them great? ### Improve customer experience Customers have questions. Your company must be quick to address them. The best customer support teams leverage case-tracking systems to manage incoming customer questions. Track your customer support team’s case tickets: - How fast are they responding to the initial case question? - How long does it take to resolve the case entirely? - What was the customer’s feedback after the case was resolved? Ideas to help your organization scale its customer support teams: 💡Reduce the number of cases raised by building a public Q&A / Help page that customers can access to address common questions. 💡Eliminate some customer questions altogether by creating thorough educational material for onboarding and ongoing use. Note, however, that you should still expect case tickets. It means your customers are using your product or service. ### Make the product better Life is good when your customers are happy. Understand how they feel by measuring customer satisfaction. You can do this by capturing your customers’ Net Promoter Score (NPS). Analyze these scores across customers and products, and then transform those unhappy customers into your biggest fans. ### Add a personal touch Every customer is different, so make them feel special. Personalization is key. Segment them to tailor your communications and offers, and don’t be afraid to pick up the phone for an old fashioned chat. Human interaction goes a long way in building long-term relationships. --- [11 SaaS finance strategies for scaling subscription revenueJoin us as we dive headfirst into the world of SaaS finance, helping you to better understand the industry, how it operates, and strategies to help you succeed in your role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/SaaS-finance-2.jpg)](https://www.financealliance.io/saas-finance-strategies/) --- ## Conclusion: You helped your company lose less, which is a BIG win for your career You did it, you prevented customers from leaving. Churn reduction is not the sexiest topic. But guess what happens as a result? ✅Your company’s valuation grows (thanks CLTV) ✅Your personal brand skyrockets (hello future promotion)👋 Keep crushing your career and have fun while doing it. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/08/FA_AI_In_Finance_Playbook_CTA.jpg) ](https://www.financealliance.io/ai-in-finance-ebook/) ### "The culture is vibrant, collaborative, & intellectually stimulating." - Imane Haouassia URL: https://www.financealliance.io/the-culture-is-vibrant-collaborative-intellectually-stimulating/ Last updated: 2023-09-29T08:07:29.000Z [Imane Haouassia](https://www.linkedin.com/in/imane-haouassia-1725a875/), Head of Finance at HAAT Delivery, wanted to stay connected with like-minded experts and explore current topics that were shaping the finance industry. Her search for these things brought her to our community and she has since become one of the most active, helpful, and inspiring members of our free [Slack community.](https://www.financealliance.io/community/) In this case study, she tells us what she has enjoyed the most since joining our community, her networking experience, whether she recommends that others join too, and more. ### What was your motivation for joining our community? As a passionate finance professional, I recognize the immense value in staying connected with like-minded experts and exploring current topics that shape our industry's landscape. > *"The opportunity to exchange ideas, share perspectives, and contribute to meaningful conversations is what truly motivates me to be an active part of this vibrant community."* ### What have you enjoyed most since joining? Since becoming a member of the Finance Alliance community, the aspect I've enjoyed the most is the enriching exchange of ideas and insights we receive during webinars, as it has been incredibly rewarding. --- [Behind the mic: Parth Kulkarni reflects on speaking at the FP&A SummitThe audience’s response to the presentation was both encouraging and engaging. Their active participation during the Q&A session and the thoughtful questions posed reflected a genuine interest in the subject being discussed.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/Parth-case-study.png)](https://www.financealliance.io/behind-the-scenes-parth-kulkarni/) --- ### What type of discussions have you found the most insightful and useful? The discussions that I've found most insightful and useful within the Finance Alliance community are those that delve into practical case studies and real-world applications of financial strategies. These discussions often provide tangible examples of how theoretical concepts translate into actionable solutions. ### What type of resources have you found the most helpful? Among the various resources available in the Finance Alliance community, I've found webinars to be particularly helpful in expanding my knowledge. ### Have you built up any new connections? Absolutely, I've built numerous new connections within the community. > *"Engaging in discussions and sharing insights has allowed me to connect with finance professionals from various industries and backgrounds."* ### How would you describe the culture of the community? The culture of the community is vibrant, collaborative, and intellectually stimulating. It's a place where finance professionals from diverse finance backgrounds come together to share their knowledge, insights, and experiences. --- [Case Study: How was your experience at the FP&A Summit?Back in November 2022, Deb attended the FP&A Summit, a virtual event consisting of two days designed to keep finance professionals ahead of trends and arm them with the skills they need to drive their careers forward.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/FP-A-virtual-event-case-study-Deb-Poch.png)](https://www.financealliance.io/virtual-summit-case-study-deb-poch/) --- ### How do you see the value of this community in comparison to other professional networks you're part of? While other professional networks have their merits, the [Finance Alliance community's](https://www.financealliance.io/community/) specialised nature and its commitment to fostering deep, relevant conversations make it an indispensable resource to grow as a finance professional. ### Why should other finance professionals join the community? Joining the Finance Alliance community is a strategic move for any finance professional who seeks to stay informed, connect with peers, access specialised knowledge, and actively contribute to their own growth within the dynamic world of finance. --- ### About Imane As a results-focused financial leader with a passion for optimising strategic financial performance and steering successful transformations, Imane thrives in high-growth environments and has honed her skills through impactful experiences in startup ecosystems. --- ### **Join our finance community** Become a part of our exclusive [Finance Alliance Slack community](https://www.financealliance.io/community/) at no cost. Connect with global CFOs and eminent finance trailblazers. Exchange insights, seek guidance, unearth promising talent, and expand your circle amidst a bustling hub of world-class finance experts. Why wait? Embark on this journey with us now. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### How to leverage AI in finance with Christian Martinez URL: https://www.financealliance.io/ama-with-christian-martinez-ai-in-finance/ Last updated: 2023-11-17T09:44:18.000Z We recently held an Ask Me Anything (AMA) session inside our [Slack community](https://www.financealliance.io/community/) with [Christian Martinez](https://www.linkedin.com/in/christianmartinezthefinancialfox/), Finance Manager at Kraft Heinz. So, Christian answered our members’ burning questions about how to successfully leverage AI tools in finance, and much more. Below, you'll find some highlights from the session, where Christian shared valuable insights and tips with our members. ⬇ ## How FP&A professionals can leverage AI tools The main use cases for using these types of tools, such as ChatGPT and Google Bard, include: - Identifying risks, opportunities, and trends. - Facilitating collaboration between departments. - Developing automatic AOP models. - Natural language processing (NLP). --- **Tired of memorizing and writing Excel formulas?** Enter ChatGPT for Excel: a cutting-edge language model developed by [OpenAI](https://chat.openai.com/chat?ref=financealliance.io). Think of it as a digital consultant that also happens to be a pro at Excel. It can help you crunch numbers, analyze financial data, or even draft reports with ease. To learn about some of the best ways to use [ChatGPT and Excel](https://www.financealliance.io/chatgpt-for-excel/) to help enhance your productivity and optimize your daily processes, check out our article. ⬇ [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ## Can ChatGPT interpret past trends and data to help automate financial forecasting? I’ve seen that [Google Bard](https://www.financealliance.io/google-bard-with-google-sheets-excel/), ChatGPT, and other similar language models are very powerful tools for many processes, but in order to help automate financial forecasting, they require an additional tool. For example, Google Bard + Python. ## How can ChatGPT help perform real-time financial analysis? I see ChatGPT helping in two main ways: 1. Generating ideas on how to perform the analysis. 2. Providing [Python code](https://www.financealliance.io/how-to-use-chatgpt-with-python/) to use on Google Colab to perform real-time financial analysis. ## How can you ensure buy-in from management in finance transformation projects/initiatives? It's really important to have that buy-in from management. In order to get it, you need to understand the ‘*why are we doing this*,’ and ‘*why this matters*.’ The answers will depend on the management and the project, but understanding those is key. Another important thing you need to do is map your stakeholders/management people and understand how much interest and influence they have in your initiative. --- [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) --- ## Do you use third-party tools as the basis for building models or are spreadsheets still the best go-to option? I prefer to use Python (with Google Colab) for this! But for the MVM (minimum viable model), I sometimes use Excel. ## What third-party tools do you recommend for finance professionals and why? I’m still in the process of exploring the potential of third-party tools. Right now, I’m using Tableau, Alteryx, Python, SQL, Microsoft Azure, and Power BI. ## What are your top 5 methods to forecast data? 1. Random forests 2. Linear regression 3. Clustering 4. Monte Carlo simulation 5. Time series ## How can AI help predict financial patterns? They can primarily help through decision-making algorithms, predictive analytics, and automation. ## What do you think are the best ChatGPT plugins for FP&A? I have many articles on plugins: [*3 Great ChatGPT Plug ins for Finance with Guide + Business Case*](https://link.medium.com/sneaghETAAb) [*Generate your own ChatGPT Plug in guide in 3 Simple Steps*](https://link.medium.com/MtxEi7FTAAb) [*10 Amazing Ways to Use ChatGPT Plugins for Stock Analysis: Part 1*](https://link.medium.com/ELk3GwITAAb) ## How can I use AI for financial modeling? There are many good use cases for [financial modeling](https://www.financealliance.io/build-a-saas-financial-model/). Some of the main ones are the creation of models (LBO, DCF, etc), research about models, generation of shortcuts guides on your financial modeling software, formula builder, etc. [How to build custom copilots with Microsoft Copilot StudioMicrosoft’s latest technological marvel, Copilot Studio, announced at Ignite 2023, marks a revolutionary step for finance professionals.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/11/Copilot-image.webp)](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) ## Do you recommend using ChatGPT API in Python or is inaccuracy still a huge issue? On its own, the API is the same as using the model on the OpenAI website. If you add things on top, it can then be valuable. On accuracy, there are two things I’d recommend: - Use this before your prompts: "*Act as a purely factual AI that doesn’t hallucinate. If you don't know an answer or if it's out of your training data, just say it...*" - Treat ChatGPT as the most junior member of your team. They can contribute and help a lot, but you need to check their work before submitting it to your stakeholders/customers. Use your knowledge and expertise to assess the veracity of what they produce. ## What news sources do you use to stay on top of all the tools and developments in AI? I mainly use Twitter and LinkedIn. I tend to follow a group of AI "general" influencers on Twitter, and then if I think it can be applied to finance and accounting, I post it on LinkedIn. These are some of the accounts I follow: - [TheRundownAI](https://twitter.com/TheRundownAI?t=nLmlqWbWYR5nSTp2gweSHg&s=09) - [TheJasSingh](https://twitter.com/TheJasSingh?t=sJgAb7nctDB%5FBIn%5FLdYgKQ&s=09) - [itsPaulAi](https://twitter.com/itsPaulAi?t=lViZhorZ2JhOaomQ8JDGyw&s=09) --- ## About Christian Martinez Christian Martinez is currently the Finance Manager at Kraft Heinz and has over six years of experience in financial planning and analysis (FP&A). He’s also the founder of The Financial Fox, a non-profit startup project which aims to democratize machine learning and data analysis. Christian was named as one of the 30 under 30 in the Accounting and Finance industry in Australia in 2021\. He also won the EMEA Data Democratizer Award in 2022 and was a finalist in the Young Leaders in Finance Awards in 2018. --- ### Download our AI in Finance eBook Artificial Intelligence (AI) is reshaping the finance industry and empowering finance teams to make smarter, data-driven decisions like never before. But how can you incorporate AI into *your* financial workflow? Welcome to the **AI in Finance** eBook, your trusted guide to merging AI’s vast potential with everyday finance operations such as forecasting, budgeting, analysis, and more.👇 [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/08/FA_AI_In_Finance_Playbook_CTA.jpg) ](https://www.financealliance.io/ai-in-finance-ebook/) ### Behind the mic: Parth Kulkarni reflects on speaking at the FP&A Summit URL: https://www.financealliance.io/behind-the-scenes-parth-kulkarni/ Last updated: 2023-09-20T09:08:51.000Z [Parth Kulkarni](https://www.linkedin.com/in/parthkulkarni1290/), Director of FP&A at Adobe, was one of our incredible speakers at the virtual FP&A Summit. He took part in one of our panels: *From Numbers to Narratives - Mastering the Art of Storytelling with Data* and also acted as our moderator. The talk was a massive hit with our audience, who had gathered to hear about the challenges of transforming complex data sets into compelling stories, as well as the important role of data visualization in conveying powerful narratives. We caught up with Parth after the event to get some behind-the-scenes insights into his experience as a speaker. We got the inside scoop on what he gained from speaking at one of our events and key takeaways from his experience. ### What inspired you to become a speaker at our event? The inspiration to become a speaker at the Finance Alliance FP&A Summit stemmed from both personal and professional alignment with the subject. Both, in my current and prior roles, I've seen firsthand the transformative power of data storytelling in finance. The event's focus on this critical aspect resonated with my own experiences and beliefs. Moreover, the opportunity to engage with industry peers, share insights, and contribute to a broader understanding of the field was an appealing prospect. The collaborative nature of the event and the chance to be part of a community working towards innovation and ethical practices in finance further fueled my desire to participate. --- [Chris Ortega Speaker Testimonial | Finance Alliance“I wanted to create an open conversation, which I think is a unique aspect of this conference compared to others. It was less about PowerPoint and more about open dialogue and communication.”![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/FP-A-Summit-case-study.png)](https://www.financealliance.io/chris-ortega-shares-his-experience-as-a-speaker-at-fp-a-summit/) --- ### How did you prepare for your presentation? Can you describe your process? Preparation involved a thorough analysis of the subject matter, identifying key takeaways, and structuring them into a coherent narrative. Collaborating with colleagues for feedback and conducting a few practice sessions ensured that the presentation was tailored to the audience's interests and needs. ### What were some of the challenges you faced during your presentation, and how did you overcome them? We didn’t face any technical difficulties during the event. Having backup materials and having had a joint practice session prior to the main event allowed for a smooth experience. Engaging the audience with questions and interactive elements helped maintain interest and overcome any initial hurdles. --- [“It was outstanding, the topics were very interesting.” - Ahmed MorsyWe recently wrapped up another exciting FP&A Summit and this time, it was a virtual event, which meant lots of different finance professionals from around the world attended.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/ahmed.png)](https://www.financealliance.io/virtual-event-case-study-ahmed-morsy/) --- ### How did the audience respond to your presentation? The audience's response to the presentation was both encouraging and engaging. Their active participation during the Q&A session and the thoughtful questions posed reflected a genuine interest in the subject being discussed. Feedback received post-presentation was constructive, with attendees appreciating the practical application of concepts and the clarity of the narrative. Several attendees expressed a desire to explore further collaboration, and the dialogue continued even after the session, indicating a successful connection with the audience. ### What did you enjoy most about the event? The event was a rich combination of learning, collaboration, and networking. What I enjoyed most was the sense of community and shared purpose among professionals from diverse backgrounds. The panel discussions were particularly enlightening, with each speaker bringing unique perspectives to the table. ![Parth speaker case study testimonial](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/parth-case-study-quote.png) A standout moment for me was being able to both participate as a moderator and a panellist in the event, giving me an opportunity to invite diverse perspectives on the topic while also sharing my own insights on the subject. The camaraderie, intellectual stimulation, and the opportunity to contribute to the industry's growth were truly rewarding experiences. ### How do you think the event impacted your personal or professional development as a speaker? Participating in the event had a multifaceted impact on both my personal and professional development. As a speaker, the preparation and delivery of the presentation honed my communication and public speaking skills. Engaging with a diverse audience challenged me to articulate complex ideas in an accessible manner. Professionally, the interactions with industry leaders and peers provided fresh insights and broadened my understanding of emerging trends. The event also facilitated networking opportunities that have potential for future collaboration. Overall, it was a growth-oriented experience that enriched my professional journey. ### Would you recommend speaking at one of our events to others? If so, why? Absolutely. The event offers a unique platform for knowledge sharing, networking, and collaboration. It fosters professional growth and provides an opportunity to contribute to important industry discussions. ### What advice would you give to other speakers? Speaking at the Finance Alliance event is a rewarding and enriching experience, but it also requires thoughtful preparation. My advice to prospective speakers would be to focus on understanding the audience's needs and tailoring the content accordingly. Engage in dialogue, not just a monologue; encourage [questions](https://www.financealliance.io/cfo-interview-questions-and-answers/) and foster an interactive environment. Practice is key, so rehearse multiple times and seek feedback from trusted colleagues. Embrace the collaborative spirit of the event, be open to learning from others, and don't hesitate to share your unique insights. Remember, the event is not just about presenting but also about contributing to a community of professionals working towards common goals. ### How did you benefit from networking opportunities at the event? The networking opportunities at the event were extensive and highly beneficial. I had the privilege of connecting with professionals from various sectors within finance, each bringing unique insights and experiences. These interactions led to stimulating discussions on industry challenges, innovations, and future directions. ![Parth speaker case study](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/Copy-of-FA_Testimonial_Template_.png) Several connections have evolved into ongoing professional relationships with the potential for collaboration on projects and research. The diversity of perspectives and the openness to share and learn made the networking experience at the event not only valuable but also inspiring. ### Are there any topics or areas of expertise that you would like to see covered at future events? Looking ahead, future events could delve into areas that are at the forefront of financial innovation and ethical considerations. Topics such as the integration of [artificial intelligence in financial planning](https://www.financealliance.io/ai-in-finance-ebook/), the role of blockchain in securing transactions, and the ethical dilemmas in data usage would be highly relevant. Additionally, exploring the impact of global economic shifts, and the role of finance in sustainable development could provide fresh perspectives. Collaborative workshops and case study analyses might also add value, allowing participants to engage in hands-on problem-solving and learning. ### About Parth Parth is a seasoned FP&A leader with a decade of experience in business partnering with senior executives at top e-commerce and technology organizations. With prior experience in analytics consulting and decision sciences, he's passionate about leveraging his skills in finance, analytics, and storytelling to drive effective decision-making and achieve desired business outcomes. --- ### Interested in speaking at one of our events? Don't miss this fantastic opportunity to connect, network, and grow professionally in a collaborative and stimulating environment. ### **Apply to speak** ### Talent retention: 10 tips to retain top finance talent URL: https://www.financealliance.io/finance-talent/ Last updated: 2025-04-10T07:51:55.000Z Attracting top finance talent is one thing, but how can you make them stick around? One of the biggest challenges CFOs face today is retaining talent with many reporting that traditional management techniques are falling short. So, what can you do to keep your best employees happy and prevent them from becoming a flight risk? --- --- Here are 10 easy but effective ways to help retain your best finance talent.👇🏼 ## **1\. Create a career development roadmap for your team** ![Career map - finance talent retention strategy](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/finance-talent-map.jpg) Nobody likes feeling as though they’re stuck with no opportunities for career progression. To avoid your team feeling like this, consider creating a career development roadmap that clearly shows where they can progress within the company – and the steps to get there. 💡 ****Tip:** Schedule regular one-on-one meetings with your team to discuss their career paths. Identify their goals and help them set milestones to achieve them. 🗓️ A few must-haves of an effective career roadmap include: - **Skill markers:** Highlight essential skills to acquire or refine at each stage. It's not just about what job they’re doing, but how they’re excelling in it. - **Timeframes:** Set realistic but challenging timeframes for reaching each milestone. - **Feedback loops:** What’s a journey without some course corrections? Incorporate regular check-ins with your team to gauge their progress and make any needed adjustments. ## **2\. Recognize and reward performance** We all know the power of a simple 'thank you,' but when it comes to retaining top finance talent, you've got to up the ante. Recognizing and rewarding performance helps to fuel motivation and serves as a catalyst for continued excellence. ****Tip:** Establish a quarterly or bi-annual bonus system tied to performance metrics. Publicly acknowledge top performers in team meetings to boost morale. 🏅 Rewards could be anything from financial bonuses to extra vacation days, half-days, public recognition (a company shout-out, a mention in a newsletter, etc.), and more. It helps to personalize rewards because everyone is different. Some may prefer a public shoutout; others might value an Amazon gift card. Tailor the reward to the individual. Don't wait for an annual review to drop praise and/or reward your team members. Do it as soon as the achievement occurs. 💡 ****Bonus tip:** Transparency is key. Make sure everyone knows what they’re being measured against by setting clear metrics. 📊 --- [CFO interview questions and answersIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/CFO-interview-questions-2.jpg)](https://www.financealliance.io/cfo-interview-questions-and-answers/) --- ## **3\. Implement a mentorship program** ![Mentorship - people around a desk](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/finance-team-retention.jpg) Mentorship isn't just a feel-good concept; it's a strategic tool that can supercharge your team's skills, enthusiasm, and yes, loyalty to the company. It can accelerate learning, increase engagement and help employees move up in their [career progression](https://www.financealliance.io/finance-career-advice-and-tips-from-3-experts/) roadmaps that we talked about. When pairing a mentor with a team member, don’t just throw names into a hat. Consider experience, skill sets, and even personalities to make mentor-mentee pairs that click. Some more tips to make your mentorship program a success: - **Set objectives:** What should the mentee learn? What skills should be developed? Set these targets upfront to give the relationship direction and focus on talent development. - **Regular check-ins:** Make mentorship meetings a mandatory monthly agenda. It’s easy to let these slide with the pressures of work, so add it to the calendar. - **Professional credits:** Offer some form of professional credit or certification that mentors can add to their portfolio. - **Exclusive access:** Give mentors and mentees first dibs on internal workshops or external professional development opportunities. 💡 ****Tip:** Don’t forget to highlight successful mentor-mentee stories in team meetings or even company newsletters. Nothing motivates like success! ## **4\. Invest in the best tools and develop a diverse tech stack** The best finance talent won’t settle for sub-par resources. They want state-of-the-art, and if you offer it, they’re more likely to stick around. With the right tools, your team can automate repetitive tasks, leaving more time for strategic work. But before you welcome new tools, make sure to assess the actual needs of your team. Do they need better [data analytics](https://www.financealliance.io/what-is-big-data-security-analytics/), faster computation, or maybe more secure storage? Find out what your team needs and use that information to help you decide on what tools to invest in. To build the best tech stack for your team, consider: - **Demo days:** Schedule demos for the top contenders. Have team members participate to gauge usability and to see if the tools meet the identified needs. - **Training time:** No tool is beneficial unless your team knows how to use it. Invest in training sessions to get everyone up to speed. - **Scalability:** Always think about the future. The tools should not only meet your current needs but also scale as your team and company grow. Check for modular functionalities and upgradability. 💡 ****Tip:** Integrate, don’t isolate. Your new tools should play well with your existing tech stack. Ensure they offer easy integration options, whether through APIs or native features. --- [CFO vs CPA: Does a CFO need a CPA?There’s no rulebook saying you must be a CPA to excel as a CFO. In this blog post, we clear up the confusion between CFOs and CPAs and explore whether you need a CPA to become a successful CFO (spoiler - you don’t!).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/cfo-vs-cpa-image.jpg)](https://www.financealliance.io/cfo-vs-cpa/) --- ## **5\. Conduct ‘stay interviews’** ![Handshake](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/finance-talent-interview.jpg) Instead of only conducting exit interviews, regularly check in with current employees to gauge their satisfaction levels and get feedback on what would make them stay. These interviews signal to your team that you care not just about their work but also about their happiness and career development. It also helps you to spot issues *before* they turn into resignation letters. Before scheduling your first stay interview with your top talent, here are some points to keep in mind: 1. **Timing is everything:** Don’t spring this up during high-stress periods like year-end closings. Pick a time when you both can talk without constantly glancing at the clock. 2. **Safe space:** Create an atmosphere of trust and confidentiality. Your finance talent should feel comfortable sharing their honest opinions without fear of repercussions. 3. **Structured yet flexible:** While you should have a set of questions prepared, be flexible enough to let the conversation flow naturally. 4. **Act on it:** The most critical part of a stay interview is what you do with the information. Create an action plan and follow through to show that you’re serious about retention. By strategically incorporating stay interviews into your talent management toolkit, you're not just gathering intel—you're showing your finance talent that their voice matters. That *they* matter. Here are a few sample questions to fuel the conversation: - What do you look forward to when you come to work each day? - Can you name one thing that would make your job more satisfying? - Do you feel like you’re growing professionally? What opportunities for growth are you seeking? - Are there any obstacles you feel are hindering your performance? - How well do you think your skills are being utilized here? - Do you feel you're adequately recognized and rewarded for your contributions? - What will keep you with this company? Conversely, what could make you leave? ## **6\. Offer training and development** Budget for online courses, certifications, or workshops that can improve your team’s [finance skills](https://www.financealliance.io/top-10-fp-a-skills-to-master/). Make it easy for them to request and access these resources. Set aside a specific annual budget for team learning. This could be for online courses, certifications, or even tickets to premium industry events like one of our in-person [FP&A Summits](https://events.financealliance.io/?%5Fgl=1%2A16vnekn%2A%5Fga%2AMTM1OTc5OTEyOC4xNjkwMTkwNTU4%2A%5Fga%5F2NXFSBEP4N%2AMTY5NDE3MTY2OC4xMzIuMS4xNjk0MTczMzAzLjAuMC4w), or an educational virtual event. Whenever someone completes a course, or certification, or attends an industry event, make it a mini celebration. Share the accomplishment in team meetings, internal newsletters, or even on your company's social media. This not only boosts morale but also encourages others to take advantage of the learning opportunities available to them. Investing in your team's continuing education isn't an expense; it’s an investment in the future of your finance department and, ultimately, your company. Equip your finance talent with the skills they need to excel, and you'll not just retain them—you'll empower them to be the driving force behind your company's financial success. --- [CFO cybersecurity: What’s the CFO’s role in cybersecurity?From crunching numbers to combating cyber threats, the role of the CFO has leaped into uncharted territory, making CFO cybersecurity one of the hottest topics in boardrooms across the globe.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CFO-cybersecurity-2.jpg)](https://www.financealliance.io/cfo-cybersecurity/) --- ## **7\. Finance team building games** ![Ludo game pieces - Finance team building games](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/finance-team-building-games.jpg) Finance doesn’t have to be all numbers and no play. A little bit of fun can go a long way in building a cohesive, [high-performing finance team](https://www.financealliance.io/how-to-make-your-finance-team-lean-5-principles-of-lean-finance/). You could set aside time each month or each quarter and focus on fun team-building activities. Here are some finance team-building games you could try with your team: - **The budget bonanza:** Divide your team into small groups and give them a mock budget to allocate across various hypothetical projects. The twist? Introduce sudden 'market changes' that force them to reconsider their budget allocations. - **Financial escape room:** Create a finance-themed virtual or physical escape room. The puzzles could include cracking a code to "unlock" investments or deciphering a maze to streamline a cash flow statement. - **Excel wizardry:** Have an [Excel tips](https://www.financealliance.io/how-to-use-python-in-excel/) and tricks contest. Who can create the most complex yet useful spreadsheet? Reward the winner with a fun trophy or a gift card. Or… take your team out of the office altogether for a game of bowling, scavenger hunts, etc. that the entire team can enjoy. ## **8\. Encourage a healthy work-life balance** Encourage flexible work hours or remote work days to accommodate the personal lives of your team members. Measure performance based on outcomes, *not* just hours spent at the desk. Why work-life balance matters: - **Increased productivity:** A rested mind is a productive mind. Ensuring your team has time to recharge will result in better focus and higher output when they are on the clock. - **Employee loyalty:** When you show concern for your team's well-being outside of work, it fosters loyalty. Your finance talent will think twice before leaving a workplace that values their life outside the office. So, how can you establish a healthy work-life balance within your team? Some quick wins could include: - **Flexible work hours:** Not everyone is a 9-to-5 person. Allow your team some flexibility in their work schedules to fit their personal lives. - **Remote work options:** If the job permits offer opportunities to work from home at least part of the time. This reduces commute stress and allows for a more comfortable work environment. - **Mandatory time off:** Encourage your team to use their vacation days. And when they do, make sure they're not bombarded with work emails and calls. Remember, a *happy* team is a *productive* team. --- [How to use Python in Excel: Microsoft & Python integrationMicrosoft has revealed a new era of analytics with the integration of Python in Excel. No more toggling between platforms or fiddling with add-ons, you can now manipulate and explore data in Excel using Python’s analytical and visualization libraries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/Python-in-excel.jpg)](https://www.financealliance.io/how-to-use-python-in-excel/) --- ## **9\. Lunch and learn** Held during the lunch hour, these are informal sessions where your team can eat while gaining insights from guest speakers, internal leaders, or even each other. This is a great way to develop skills, improve employee engagement and offer networking opportunities for your team. The trick to a successful lunch and learn session is to let your finance talent have a say in the topics they'd like covered or the guest speakers they'd want to hear from. And remember to keep them varied, don’t stick to the same old thing every time. A little diversity in subject matter like a session on mental wellness or communication skills will help keep things fresh. ## **10\. Offer financial incentives beyond salary** Consider adding stock options, impressive retirement plans, or even profit-sharing strategies to give employees a real stake in the company’s success. Types of financial incentives to consider: - **Stock options:** These provide employees the option to buy shares of the company at a pre-determined price after a specified period. The better the company does, the more valuable the stock becomes, benefiting both the company and the employee. - **Retirement plans:** A robust 401(k) matching program or other retirement benefits not only helps your team plan for their future but also makes your company more attractive compared to competitors who offer less. - **Profit-sharing plans:** A share in the profits directly correlates with the company's success. The better the company does, the bigger the slice for your employees. - **Bonuses for milestones:** Offering bonuses for reaching particular milestones or achieving specific goals can serve as immediate, tangible rewards that boost morale and motivation. ### Pro tip: Transparency is key 🗝️ Whatever financial incentives you decide to offer, make sure they're clearly outlined and transparently communicated to your team. The last thing you want is a misunderstanding that leads to disappointment. Clear, upfront communication about these benefits can make them even more powerful as retention tools. --- ## FAQs: Retaining finance talent **1\. What are some quick wins in retaining finance talent?** Quick wins often come from addressing immediate concerns. Consider implementing flexible work hours or remote work options, offering immediate skill-building opportunities through Lunch & Learn sessions, and initiating recognition and reward programs. These steps show your finance talent that you're actively investing in their work-life balance and professional development. **2\. How can I measure the effectiveness of these finance talent management strategies?** Success can be measured using both qualitative and quantitative metrics. Qualitatively, regular stay interviews and employee satisfaction surveys can provide insights into how your finance talent feels about the implemented strategies. Quantitatively, reduced turnover rates, higher levels of productivity, and improved team performance can serve as indicators of successful talent management strategies. **3\. Is financial incentive the most crucial aspect of retaining finance talent?** While financial incentives like competitive salaries, bonuses, and stock options are undoubtedly important, they aren't the sole factor in retaining finance talent. Today's professionals look for a well-rounded package that also includes work-life balance, opportunities for learning and growth, and a positive, inclusive work environment. Overemphasizing financial incentives at the expense of these other factors can still lead to high turnover rates. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### 3 key pain points in budgeting URL: https://www.financealliance.io/3-key-pain-points-in-budgeting/ Last updated: 2026-03-05T17:01:40.000Z Budgeting is an important business process that helps organizations allocate resources and track progress towards meeting their financial goals. However, the budgeting process can be hampered by several factors. In this article, we'll discuss the three key pain points in budgeting and how they can be addressed. ### **1\. Ineffective technology** ![three telephones and a mobile phone image](https://media.graphassets.com/gQMXjCoQQ9CLJoOQlyrl "1669483510900.jfif") More than 60% of companies still use [Microsoft Excel](https://www.financealliance.io/how-to-use-python-in-excel/) as their primary budgeting tool. Excel is very functional and user-friendly. However, it may not be the best tool for budgeting. Issues arise when you must integrate and roll up the multiple business units at the total organization level. Many [budgeting](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/) tools are now available that can be a better option than using Excel. ### 2\. **Long cycle times** ![Man waiting for computer to load](https://media.graphassets.com/Um6pkWi2RB656EN6i462 "1669485263712.jfif") The average cycle time for preparing an annual budget is around three to four months. This is way too long, slow to detect problems and doesn't add a lot of value. The annual budgeting process is a key component of financial planning for many businesses. In order to be more effective, budgeting needs to be streamlined and accelerated. There are a number of ways to improve the budgeting process and aim for shorter cycle times by data integration, real-time monitoring, and automated processes. --- [Budgeting vs forecasting: Understanding 20 key differencesWhen it comes to guiding decision-making, allocating resources, and ensuring an organization’s long-term financial stability. Budgeting and forecasting are two crucial FP&A activities. Forecasting and budgeting are connected but separate activities with differing goals, methods, and results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/EGGS.jpeg)](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) --- ## 3\. **Gaming rather than stretch behavior** ![Super Mario figures](https://media.graphassets.com/a5QYw6KR4ihnaZI7ypyi "1669483694074.jfif") The traditional budgeting process incentivizes “gaming” instead of a “stretch” behavior. ### What is “Gaming” behavior? - Spending money at year end to avoid losing the budget next year. - Accelerating sales near year-end/month-end to meet the budgeted quota. - Negotiating easy targets - Deferring necessary expenditure. - Budgetary slack: i.e., deliberate under–estimation of budgeted revenue. or over-estimation of budgeted expenses. ### What is a “Stretch” behavior? A stretch means pushing the boundaries on what can be realistically achieved. For example: - For the sales division, this may mean setting higher sales targets than what would usually be expected. - For the production department, this may mean producing more goods for less. ## Better budgeting practices: - Create budgets after goals/strategic direction has been set. - Develop continuous/[rolling forecasts](https://www.financealliance.io/rolling-forecast-best-practices/). - Employ and Automated [driver-based metrics](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/). - Be honest and realistic. ### **Conclusion** Budgeting is a critical part of any organization, yet it is often ineffective. The three key pain points in budgeting are ineffective technology, long cycle times and gaming rather than stretch behavior. Ineffective technology results in a lack of transparency and control over budgeting processes. Long cycle times make it difficult to respond to changes in the business environment. Gaming rather than stretch behavior leads to unrealistic budgets that do not take into account the true costs of doing business. --- ### Use of data analytics and BI tools: Transforming FP&A URL: https://www.financealliance.io/use-of-data-analytics-and-bi-tools-trend-3-transforming-fp-a/ Last updated: 2025-04-07T10:07:10.000Z We'll continue our examination of upcoming trends that are transforming FP&A in today's article, with an emphasis on the increased use of data analytics and business intelligence tools. Financial planning and analysis (FP&A) teams can increase the use of data analytics and business intelligence (BI) tools to improve decision-making in several ways: ### Identify the key business questions that need to be answered The main business questions that FP&A teams hope to resolve through [data analysis](https://www.financealliance.io/microsoft-fabric-for-data-analysis/) should be identified. Then, they should prioritize efforts and concentrate on the most significant issues, challenges and problems. ### Collect and clean the necessary data It's important to make sure we have access to all the necessary data in order to respond to the posed business problem. To make sure the data is correct and consistent for analysis, [data also needs to be cleaned](https://www.financealliance.io/data-cleaning-techniques/), massaged and prepared. ### Choose the right BI tools and techniques FP&A teams should select BI tools and methods that are appropriate for their unique requirements and objectives. Traditional tools like spreadsheets and dashboards as well as cutting-edge techniques like [machine learning](https://www.financealliance.io/fpa-machine-learning/) and predictive analytics may be used in this. --- [How to improve sales forecast accuracy | Finance AllianceWhile perfect predictions may not be possible, increased accuracy is within reach. The key is blending quantitative data with qualitative insights to get a complete picture. Aim for reasonable precision, not perfection.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/how-to-improve-sales-forecast-accuracy-2.jpg)](https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/) --- ### Use data visualization to communicate insights The insights and recommendations obtained from FP&A teams' data analysis can be effectively communicated to stakeholders by using [data visualization](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/). To convey their findings in a style that's simple to grasp, they should employ clear and succinct graphs, charts, and tables. ### Continuously improve the use of data analytics and BI To make sure they're utilizing the most efficient tools and approaches and maximizing the value of their data, FP&A teams should constantly assess and enhance how they employ data analytics and BI. This might require investing in new technology and methods as necessary, as well as training and development for team members. In conclusion, the usage of BI technologies and data analytics in FP&A has grown significantly in recent years. These technologies can be applied in a number of different ways to provide a more precise, predictive analysis of financial performance. Companies may make sure their financial operations remain as effective and efficient as possible by putting the proper tools and processes in place. --- ### Download our AI in Finance eBook Artificial Intelligence (AI) is reshaping the finance industry and empowering finance teams to make smarter, data-driven decisions like never before. But how can you incorporate AI into *your* financial workflow? Welcome to the [**AI in Finance**](https://www.financealliance.io/ai-in-finance-ebook/) eBook, your trusted guide to merging AI’s vast potential with everyday finance operations such as forecasting, budgeting, analysis, and more.👇 [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/08/FA_AI_In_Finance_Playbook_CTA.jpg) ](https://www.financealliance.io/ai-in-finance-ebook/) ### How to improve your sales forecast accuracy URL: https://www.financealliance.io/how-to-improve-sales-forecast-accuracy/ Last updated: 2025-11-04T10:22:11.000Z How to improve sales forecast accuracy is a million-dollar question for businesses looking to predict future revenue. And if you’re here, you likely want to know the answer to that question too. While perfect predictions may not be possible, increased accuracy *is* within reach. The key is blending quantitative data with qualitative insights to get a complete picture. Aim for reasonable precision, *not* perfection. Of course, accurate forecasting is easier said than done. But by using these forecasting best practices, you can boost the accuracy of your next forecast and set your sales team up for success. **Topics covered:** - [Forecast accuracy definition](https://www.financealliance.io/p/bd766ae6-9d0b-4fa2-afb6-efab44dc1643/#what-is-the-definition-of-forecast-accuracy) - [What is a good forecast accuracy percentage?](https://www.financealliance.io/p/bd766ae6-9d0b-4fa2-afb6-efab44dc1643/#what-is-a-good-forecast-accuracy-percentage) - [Tips to improve the accuracy of your sales forecasts](https://www.financealliance.io/p/bd766ae6-9d0b-4fa2-afb6-efab44dc1643/#how-to-improve-sales-forecast-accuracy) --- --- ## **What is the definition of forecast accuracy?** Forecast accuracy refers to the degree to which a predicted value matches up with the actual result. Simply put, it's how close you can get your sales predictions to what ultimately happens. Higher forecast accuracy means your predictions consistently and reliably reflect the direction of future performance. Perfection is unrealistic - there are *always* uncertainties. But with a sound forecasting process, you can achieve solid accuracy quarter after quarter. ## **What is a good forecast accuracy percentage?** A good sales forecast accuracy depends on the industry, the volatility of the market, and the forecasting method used. However, most industries consider a sales forecast accuracy within 10% of your forecast as pretty good. For example, if a company predicted they would sell 100 units of a product and they sold 95, their forecast accuracy would be 95%. This is a commendable rate. **Forecast accuracy formula:** > *Day 1 Forecast – Actual Sales) / Actual Sales \* 100%* However, achieving such a high rate of accuracy isn’t always feasible.[ Intangent](https://www.intangent.com/blog/6-shocking-statistics-about-sales-forecasting) reports that **80%** of sales organizations don’t have a forecast accuracy greater than **75%.** And **93%** of sales leaders are unable to forecast revenue within **5%**, even with two weeks left in the quarter. But that’s not all. Here are some more interesting (albeit shocking) statistics to note: - Less than **50%** of sales leaders and sellers have high confidence in their company's forecasting accuracy. ([Gartner’s ‘State of Sales Operations Survey’](https://www.gartner.com/en/newsroom/press-releases/2020-02-12-gartner-says-less-than-50--of-sales-leaders-and-selle)) - **55%** of sales leaders do not have high confidence in their forecasting accuracy. ([*Intangent*](https://www.intangent.com/blog/6-shocking-statistics-about-sales-forecasting)) - **67%** of organizations lack a formalized approach to forecasting altogether. ([*Intangent*](https://www.intangent.com/blog/6-shocking-statistics-about-sales-forecasting)) - The top **24%** of sales teams are **1.5 times more likely** to base forecasts on data-driven insights. ([Salesforce](https://www.salesforce.com/blog/15-sales-statistics/)) The data paints a clear picture - there is significant room for improving sales forecast accuracy across most organizations. While perfection is not attainable, striving for a high degree of precision is possible with the right approach. By leveraging data, insights, and robust processes, top-performing teams can boost accuracy and operate with greater visibility. --- [Rolling forecast best practices | Finance AllianceA rolling forecast formula is a straightforward concept. For every period that passes, a new one is added to the end of the forecast…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/rolling-forecast-best-practices-2.jpg)](https://www.financealliance.io/rolling-forecast-best-practices/) --- ## **How to improve sales forecast accuracy** Now let's dive into proven tactics to improve forecast accuracy. Applying the following strategies will help you to develop predictions that inspire confidence and drive better decisions. So, here are our top tips on how to improve sales forecasting accuracy: ## 1\. Create a simple model If you don’t know where to start, keep it simple. This is an effective approach because a basic model is an adaptable model. With it, you can grasp the foundational elements of sales trends *without* getting stuck in complexity. With fewer variables, it’s easier to communicate the reasoning behind your forecast and obtain approval from leadership. For example, starting with a regression forecasting model for several sales activities will be a lot more manageable than throwing in all types of variables and trying to make it work. Of course, that’s not to say that a more complex forecast *wouldn’t* work. But if you want to test a new model, starting simple ensures the sales forecast remains responsive to changing business realities, *without* the risk of overcomplicating the process from the outset. As the company gathers more data and learns more about its sales patterns, it can improve the model. ## 2\. Keep clean records and validate data sources You’ve probably heard the saying, garbage in, garbage out. Any errors, duplications, or outdated data will be incorporated into forecast models, reducing reliability. > *Clean data = accurate data.* Clean records and validated data sources are critical for increasing sales forecast accuracy for a few key reasons: - With clean sales data, it’s easier to spot trends, cycles, and trajectories that inform future projections. - Data inputs need to originate from credible, consistent sources. Unvalidated market research or biased rep forecasts distort models. - Quality data and vetted sources consolidate the bedrock that precise forecasts are built on, forming the foundation for accuracy. Flawed data undermines accuracy. The integrity of your [sales forecast](https://www.financealliance.io/podcast/financial-forecast-model/) is significantly influenced by the credibility of the data. So, you must be diligent in making sure the data used in your forecasting process is validated, originated from trusted sources, and updated consistently. --- [3 cash flow forecasting challenges | Finance AllianceCash flow forecasting is a continuous process, and it’s normal to face challenges along the way. However, with some effort and determination, you can overcome these obstacles and improve your forecasting skills over time.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/labyrinth-g0189cfb72_1920.jpg)](https://www.financealliance.io/3-cash-flow-forecasting-challenges/) --- ## 3\. Use historical data When creating sales forecasts based on historical data, past performance provides invaluable context. By analyzing previous sales trends, you expose seasonal fluctuations, growth trajectories, and the impact of past strategies. This enables pattern recognition that informs future projections. Evaluating how to forecast sales based on historical data allows you to spot where cycles exist. Which months see spikes or dips? How has growth progressed year over year? What catalysts previously drove major gains or declines? The answers shape reliable assumptions. With this hindsight, you can set realistic targets and account for seasonal variations. Past trends become reference points to calibrate your models. Isolate factors that disrupted past forecasts and adjust your lens. Historical data anchors your forecast in realism while revealing opportunities for improvement. ## 4\. Use the right sales forecasting method Choosing the right forecasting approach is crucial for improving forecast accuracy. Different methods have strengths and weaknesses based on your business model, sales cycle, and data availability. Align the methodology with your unique needs and processes. Shorter-term tactical forecasts may leverage different techniques than long-range strategic projections. Consider options like: ### **Top-down vs bottom-up forecasting** The top-down method starts with high-level estimates and breaks them down into smaller targets; it's effective with clear strategy and established sales patterns. ![Top-down vs Bottom-up forecasting](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/09/Top-down-vs-bottom-up-2.jpg) [Learn more about top-down vs bottom-up forecasting.](https://www.financealliance.io/top-down-vs-bottom-up-forecasting) Bottom-up starts with local projections and aggregates them, excelling when diverse products or large deals are involved. Evaluate your sales landscape to choose the best method for clear forecasting. A blended approach is also an option. ### **Pipeline forecasting** This method focuses on current deals or leads in the sales process. It evaluates the likelihood of each deal closing based on its stage in the sales pipeline. For example, a lead in the final negotiation phase might have a higher chance of converting than one in the initial contact phase. By weighing these probabilities, companies can predict their future sales. ### **Historical trend analysis** As we previously mentioned, historical forecasting looks at past sales patterns and seasonality to estimate future trends. Some pros and cons to consider: **Pros:** - **Easy peasy:** One of the best things about historical forecasting is its simplicity. Got past sales data? Plug it in, and you’re well on your way to creating an in-depth forecast based on your own data. - **The devil you know:** When your sales have had a steady rhythm, historical data can be incredibly useful. You can use it to compare month-over-month or year-over-year revenue with fairly accurate results. - **Budget-friendly:** No need to hire a team of analysts or invest in fancy software. A solid Excel sheet or basic CRM could give you enough juice to make decent projections. **Cons:** - **Past ≠ future:** If your market’s changing faster than a chameleon on a rainbow, historical data can be misleading. - **Blind spots:** New competitors entering the ring? A potential economic downturn? Historical forecasting won't warn you. It’s like trying to drive using only the rearview mirror. - **Missed opportunities:** Relying too much on the past could mean you’re not agile enough to capitalize on new trends or markets. While you're looking back, your more adaptive competitors could zoom past you. Some other methods (and sales forecasts strategies) include: - **Regression forecasting:** This method uses statistical algorithms to identify the relationships between sales and one or more influencing factors like advertising spend or market trends. It's super useful for understanding how various elements could impact your sales trajectory. - **Opportunity stage forecasting:** Here, you estimate the likelihood of a sale based on the current stage of each opportunity in your sales pipeline. It's great for giving a nuanced view of short-term revenues. - **Opportunity creation forecasting:** This focuses on the rate at which new sales opportunities or leads are being created. It helps you understand if you're generating enough new business to meet future sales goals. - **Length of sales cycle forecasting:** By analyzing how long it typically takes to close a deal, you can predict when current opportunities will likely turn into revenue. It's good for long-term planning and resource allocation. - **Seasonal forecasting:** This method considers seasonal trends and cycles in the industry, helping you plan inventory and staffing around high- and low-sales periods. - **Lead-driven forecasting:** This starts with the number and quality of leads in your sales funnel to predict sales. It's fantastic for scaling efforts—knowing what each lead can potentially bring in helps you allocate resources wisely. - **Multi-variable analysis forecasting:** This one's the Swiss Army knife of forecasting. It combines various factors like market conditions, seasonality, and lead quality to provide a comprehensive view of future sales. - **Test-market analysis forecasting:** By introducing a product to a limited market, you can gauge its future success. It's a proactive way to validate if a new launch will soar or sink before going all in. - **Intuitive forecasting:** This relies on the experience and gut feelings of your sales team. It may not be data-driven, but it can capture intangibles like market sentiment. - **Time series forecasting:** This method uses past sales data to identify trends or patterns over time, helping you make educated guesses on future sales. It's the go-to for businesses with stable, repetitive sales cycles. - **Demand forecasting:** This aims to predict consumer demand for your products or services. It’s crucial for inventory management, helping you stock up just right—neither too much nor too little. Choose an approach that aligns with your sales cycle, available data, and resources. Blend methods to optimize strengths and minimize blind spots. --- [How to navigate uncertain times with a driver-based forecastMany companies are announcing budget cuts and layoffs in response to the uncertain economic environment. Unfortunately, most companies lack the finance tools and strategic clarity needed to navigate such an environment well.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceChris King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/driver-based-forecasting.jpg)](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/) --- ## **5\. Integrate influencing factors** If you've given all the above methods a whirl and you're still not hitting the mark, it might be time to dig deeper with some qualitative insights. There could be other hidden variables, either inside or outside your organization, that your existing sales forecast process is missing. If you want to know how to improve forecasting accuracy, take a look at some likely elements that *could* be throwing off your predictions: ### Seasonality Let's start with the weather—well, sort of. We're talking about the 'climate' of your sales. If you have a forecast accuracy dashboard, pay attention to seasonal spikes or dips. Many businesses experience fluctuations in sales due to various seasonal factors, whether it's retail sales spiking during the holiday season or a drop in tourism-related sales during off-peak months. Knowing when your products are hot (or not) is key to improving sales forecast accuracy. ### Market changes Are you keeping tabs on your market? If a new competitor struts into town or a popular product starts trending, you'll want to know ASAP. This can either be a hurdle or an opportunity. Either way, plug these changes into your forecasts to stay ahead of the curve. ### Economic conditions No sales forecast lives in a vacuum. It's influenced by everything from inflation rates to unemployment numbers. So, if you're scratching your head about how to [improve sales forecast accuracy](https://www.financealliance.io/7-benefits-of-a-cash-flow-forecast-to-drive-sustainable-business-growth/), consider economic indicators. A cautious peek into economic reports can give you a more nuanced view of what to expect. ### Business changes Is your company rolling the red carpet out for new hires? Or perhaps you're launching a new product or tweaking pricing? These internal shake-ups need to be accounted for in your sales forecast. Updates like these can send ripples across your forecast accuracy dashboard. Ignoring them is like ignoring a leaky faucet—annoying at first, disastrous over time. ### Legislative changes New taxes, trade tariffs, or compliance regulations can play a big role in your sales numbers. When legislation changes, the first place you'll see the impact is on your bottom line. So, you'd do well to factor these shifts into your strategy on how to improve sales forecast accuracy. ## **6\. Leverage modern technology for precision** If you're still juggling spreadsheets or scratching your head over an abacus, it's time to step into the 21st century. Leveraging technology isn't just trendy - it's practically a must-do for anyone serious about sharpening their sales forecast accuracy. Here are a few ways you can leverage technology to help improve forecast accuracy: ### AI and Machine Learning Imagine having a mini-Einstein in your computer, crunching numbers while you sip your latte. That's AI for you. [Artificial intelligence](https://www.financealliance.io/ai-in-finance-ebook/) and [machine learning](https://www.financealliance.io/fpa-machine-learning/) algorithms can sift through mountains of data very quickly. They not only look at historical trends but can also consider a plethora of variables you might not even be aware of. Plus, as AI systems are trained over time, their predictions become increasingly precise. --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ### CRM systems Customer Relationship Management (CRM) systems have come a long way and can now integrate with your sales data and even offer built-in forecasting tools. A CRM keeps all your info in one place and makes it much simpler to track changes that could impact sales, such as a high-performing sales rep leaving or a new product launching. ### Automate data collection Automated data collection tools can sync up with various data sources and funnel them right into your forecasting model. They save time, reduce errors, and most importantly, allow you to focus on what really matters: strategic planning. ### Use forecasting tools The digital age presents a plethora of advanced sales forecasting software and tools, tailored to streamline and enhance the prediction process. By tapping into these technologies, you can automatically analyze vast datasets, spot patterns more efficiently, and adjust predictions in real time. ### Consistently review technology While technology does the heavy lifting, human oversight remains crucial. Setting up regular review intervals using these technological tools ensures that the forecast remains in line with real-world developments. Regularly updating and refining predictions with the aid of technology ensures forecasts are both current and relevant. --- [How to use Python in Excel: Microsoft & Python integrationMicrosoft has revealed a new era of analytics with the integration of Python in Excel. No more toggling between platforms or fiddling with add-ons, you can now manipulate and explore data in Excel using Python’s analytical and visualization libraries.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/Python-in-excel.jpg)](https://www.financealliance.io/how-to-use-python-in-excel/) --- ## **7\. Prioritize cross-department collaboration** For a sales forecast to truly resonate with accuracy, it must be informed by a holistic view of the organization. This means incorporating insights not just from the sales team, but also from marketing, operations, and customer service. Every team brings its own flair to the table, spotting trends or red flags that others might miss. By setting up inter-departmental meetings, finance teams can refine forecasts by incorporating a wide array of valuable insights, ensuring the predictions are both comprehensive and precise. ### Sales team input The frontline sales team is often the first to witness shifts in market demands or customer preferences. Their on-the-ground experiences are invaluable for accurate forecasting. Encouraging regular feedback and insights from them ensures that the forecast is rooted in real-world observations. You should also consider training the sales team on the importance of accurate data input to ensure information fed into forecasting models is both reliable and relevant, reducing the chance of skewed predictions. --- ### FAQs: Sales forecast accuracy What factors affect a sales forecast? Several factors can affect a sales forecast, including market conditions, economic indicators, seasonality, competitor activities, and internal changes like new hires or product launches. External legislative changes can also impact forecasts. Understanding these variables and how they interact is crucial for creating a reliable sales forecast. What things can make sales forecasts inaccurate? Inaccurate data, outdated methods, lack of cross-departmental input, and failing to adapt to market changes can all make a sales forecast inaccurate. Overreliance on gut instinct or overly optimistic projections can also skew results, leading to poor decision-making and missed opportunities. What is the key to successful forecasting? The key to successful forecasting lies in integrating accurate data, utilizing advanced analytical methods, and maintaining an agile approach that allows for quick adaptation to changing conditions. Continuously updating and improving your forecasting model ensures that it remains a useful tool for strategic planning. Why improve forecast accuracy? Improving forecast accuracy is crucial for strategic planning, risk management, and resource allocation. Accurate forecasts allow businesses to make informed decisions, identify growth opportunities, and mitigate potential risks, thereby enhancing overall organizational performance. What is forecast accuracy based on? Forecast accuracy is based on how closely predicted numbers align with actual outcomes. It is typically measured by comparing the forecasted figures to the actual sales for a given period, often using metrics like Mean Absolute Percentage Error (MAPE) or Forecast Error. High forecast accuracy indicates a reliable, well-calibrated model and effective planning. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### Finance Alliance Awards, 2023 URL: https://www.financealliance.io/finance-alliance-awards-2023/ Last updated: 2023-10-10T11:59:43.000Z We want to shine a spotlight on the unsung heroes in finance and give credit where credit is due (pun intended), which is why we’ve launched the first ever Finance Alliance Awards, 2023. Whether you want to nominate a great team, a top finance pro, or even shine a light on your own successes – we have an award for every finance achievement.🥇 So, without further ado, it's time to roll out the financial red carpet and get your nominations in! ### Key date for your diary - **💌 Nomination deadline: October 4, 2023** ### 2023 Awards Categories Let’s take a look at each of the awards up for grabs… - Finance Leader of the Year 2023 - Finance Team of the Year 2023 - Lifetime Achievement Award in Finance 2023 ### Finance Leader of the Year 2023 The best finance leaders aren't just about the numbers. They inspire trust, foster innovation, and make waves in an ocean of monetary challenges. Got the vision of a hawk when it comes to financial strategies, while also maintaining a golden touch with your team and stakeholders? Or know someone who does? The finance arena awaits its champion. Get nominating! 🌟 [Nominate here](https://productmarketingall.typeform.com/to/WsvhuxCM) ### Finance Team of the Year 2023 Talk about team synergy! This award is scouting for squads that do more than crunch numbers. We're seeking out teams with a dynamic pulse, unmatched collaboration, and results that would make Wall Street take a double glance. If you're part of (or acquainted with) a finance team that's setting the gold standard, now's the time to give them the credit they deserve! [Nominate here](https://productmarketingall.typeform.com/to/WsvhuxCM) ### Lifetime Achievement Award in Finance 2023 Finance isn't just about yearly quarters, it's about decades of dedication, innovation, and sheer grit. This award is reserved for an incredible finance professional who has seen it all, done it all, and still making a mark. Their legacy? A story of fiscal genius, invaluable contributions, and lessons for the next generation. If you know a finance pro who fits the bill, help us etch their name in history. 🏆 [Nominate here](https://productmarketingall.typeform.com/to/WsvhuxCM) ### Our judging criteria Here's what we're scouting for in our victors: - Finance professionals revolutionizing the industry. - Concrete outcomes that are evident – be it profits, successful investments, portfolio growth, enhanced financial procedures, or elevating fellow teams to excellence. - Testimonials from at least one other colleague within your/the nominee’s organization. - Any other accolades or achievements that make you/your nominee truly shine amidst the financial elite. Happy nominating and best of luck! ### How to use Python in Microsoft Excel URL: https://www.financealliance.io/how-to-use-python-in-excel/ Last updated: 2025-05-07T11:06:02.000Z Microsoft has revealed a new era of analytics with the integration of Python in Excel. No more toggling between platforms or fiddling with add-ons, you can now manipulate and explore data in Excel using Python’s analytical and visualization libraries - all without having to install additional software. > “*Today, we are excited to introduce the Public Preview of Python in Excel – making it possible to integrate Python and Excel analytics within the same Excel grid for uninterrupted workflow*.” – [Stefan Kinnestrand, General Manager of Modern Work at Microsoft.](https://techcommunity.microsoft.com/t5/microsoft-365-blog/introducing-python-in-excel-the-best-of-both-worlds-for-data/ba-p/3905482) In collaboration with Anaconda, Python in Microsoft Excel bridges the gap between the intuitive user-friendly interface of Excel and the intricate capabilities of Python, unlocking unprecedented possibilities for finance professionals. So, if you’re as excited about this news as we are, keep reading to learn more about what’s possible, how Python in Excel works, how to use it in your role, and more. **Table of contents:** - [How Python in Excel works](https://www.financealliance.io/p/97c76185-477d-4892-ae12-168f28101c85/#how-python-in-excel-works) - [What we know about the new =PY function](https://www.financealliance.io/p/97c76185-477d-4892-ae12-168f28101c85/#what-is-the-py-function) - [How to use the PY function](https://www.financealliance.io/p/97c76185-477d-4892-ae12-168f28101c85/#how-to-use-the-py-function) - [Using Python in Excel (finance applications)](https://www.financealliance.io/p/97c76185-477d-4892-ae12-168f28101c85/#using-python-in-excel-finance-applications) - [Collaboration abilities ](https://www.financealliance.io/p/97c76185-477d-4892-ae12-168f28101c85/#share-and-collaborate-with-your-team) - [FAQs](https://www.financealliance.io/p/97c76185-477d-4892-ae12-168f28101c85/#faqs-python-in-excel) [**Source: Microsoft's YouTube Channel*](https://www.youtube.com/watch?v=H4XbvL8Mglc) ## How Python in Excel works The integration of Python in Excel signifies a significant [advancement in data analytics](https://www.financealliance.io/microsoft-fabric-for-data-analysis/). With the introduction of the 'PY' function (*more on that below*), Excel now embeds Python's capabilities, allowing users to directly utilize its vast libraries for tasks like data visualization, machine learning, and advanced analytics, all within the familiar confines of an Excel workbook. This eliminates the need for separate installations or shifting between platforms, which is amazing news for anyone who regularly works with both tools. A standout aspect of this integration is the ability to type Python code directly into an Excel cell. Once entered, the calculations are conducted securely within the Microsoft Cloud, and the results – whether they're data points, plots, or visualizations – are relayed back to the Excel worksheet. This seamless process allows users to pair Python's renowned data analysis tools with Excel's traditional features like formulas, charts, and pivot tables. Excel's capability to source data has also been enhanced. Its built-in connectors and the Power Query feature streamline the process of importing external data into Python-activated workflows, optimizing the analytics process. With Anaconda's Distribution operating on Azure, users have access to some of the most popular Python libraries, including pandas for data manipulation, statsmodels for statistical modeling, and tools like Matplotlib. The best news, though, is that using Python in Excel is simple. You can access it directly from Excel without having to install or set up anything extra: > *“Now you can do advanced data analysis in the familiar Excel environment by accessing Python directly from the Excel ribbon. No set-up or installation is required…* > “Using Excel’s built-in connectors and Power Query, you can easily bring external data into Python in Excel workflows.” - [Stefan Kinnestrand, General Manager of Modern Work at Microsoft.](https://techcommunity.microsoft.com/t5/microsoft-365-blog/introducing-python-in-excel-the-best-of-both-worlds-for-data/ba-p/3905482) --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ## What is the =PY function? According to [Microsoft](https://techcommunity.microsoft.com/t5/excel-blog/announcing-python-in-excel-combining-the-power-of-python-and-the/ba-p/3893439), the new =PY function lets users seamlessly integrate Python's analytical capabilities into Excel's grid. It can be used just like any other Excel function or macro. Here is an example of the =PY function in action: ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/Microsoft-example.gif) Source: [Microsoft](https://techcommunity.microsoft.com/t5/excel-blog/announcing-python-in-excel-combining-the-power-of-python-and-the/ba-p/3893439) It’s important to note that this new function operates securely within the Microsoft Cloud, ensuring enterprise-level security aligned with [Microsoft 365](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/)'s compliance standards. A highlight of this function is its commitment to user privacy: it prohibits Python code from accessing user identity and adds an extra layer of security when opening workbooks from the internet by isolating them in unique containers. [Microsoft Excel](https://techcommunity.microsoft.com/t5/excel-blog/announcing-python-in-excel-combining-the-power-of-python-and-the/ba-p/3893439) reports: > “*Data from your workbooks can only be sent via the built-in xl() Python function, and the output of the Python code can only be returned as the result of the =PY() Excel function*.” --- [How to use GPT-4o in finance (and data analysis)You can now upload Excel, CSV, and other spreadsheet files directly to GPT-4o. No more copying and pasting data into ChatGPT manually, which makes the entire process of analyzing complex data sheets a lot easier and less time-consuming.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/GPT-4o-finance-2.jpg)](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/) --- ## How to use the PY function To use the new =PY function to access Python in Excel, simply type "=PY" in your desired [Excel](https://www.financealliance.io/chatgpt-for-excel/) cell, followed by the relevant Python code. Once the code is executed, the results - whether they’re calculations, data manipulations, or visualizations - materialize directly in the Excel worksheet. For example, if you want to merge two intricate datasets, it can be accomplished quickly using [Python](https://www.financealliance.io/how-to-use-chatgpt-with-python/) code right within Excel, facilitated by this function. 💡 ****Note**: **Some users are reporting difficulties accessing Python in Excel when using this new formula. We suspect this is due to the initial rollout being in the early stages and expect Microsoft to solve any issues in due course.* *Microsoft has reported that Python in Excel will be included with the Microsoft 365 subscription during the initial preview stage. However, they’ve also emphasized that some functionality will be restricted without a paid license after the preview comes to an end.* --- [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) --- ## Using Python in Excel (finance applications) The integration of Excel and Python has opened a whole new level of data analysis to transform your everyday workflow. So, let’s take a closer look at the types of analysis you can achieve with Python in Excel: ### Clean, prepare, and manipulate data You can use Python in Excel to clean and manipulate your data. This is because Python's integration into Excel introduces a robust suite of [data cleaning](https://www.financealliance.io/data-cleaning-techniques/) tools, streamlining the often complex and time-consuming process of data preparation. You can now effortlessly pinpoint missing values, standardize inconsistent formats, and eradicate duplicate entries. Beyond these basics, the flexibility of Python allows for more advanced manipulations like employing regular expressions, which proves invaluable for pattern-based transformations and refinements. ### Build advanced data visualizations Both Anaconda and Microsoft say that with Python in Excel, users can [create advanced data visualizations](https://www.financealliance.io/storytelling-with-data-visualization-playbook/). In Excel, users can harness the capabilities of Python charting libraries such as [Matplotlib](https://matplotlib.org/) and [Seaborn](https://seaborn.pydata.org/), to craft diverse and intricate visualizations. From traditional bar graphs and line charts to more specialized displays like heatmaps, violin plots, and swarm plots, these libraries enhance Excel's data representation, offering a richer perspective on datasets. ### Financial forecasting (plus predictive analytics & machine learning) The integration of Python libraries like [scikit-learn](https://scikit-learn.org/stable/index.html) and [statsmodels](https://www.statsmodels.org/stable/index.html) into Excel opens the door to a wealth of advanced analytical techniques. You can employ[ machine learning for predictive analytics](https://www.financealliance.io/fpa-machine-learning/), use regression analysis to better understand asset price movements or delve into time series modeling for accurate financial forecasting. ## Share and collaborate with your team Sharing Python-driven analyses is now as simple as sharing any Excel workbook. Colleagues can interact with and update the Python-based analytics *without* the hassle of extra installations or managing intricate dependencies. Team members can engage through comments, @ mentions, and co-author just as they would with standard Excel files. Even if a teammate doesn't have the Python in Excel feature activated, they can still refresh the analytics to view the latest information. Plus, with the application of sensitivity labels, all shared Excel workbooks align with an organization's information protection protocols. Essentially, it retains the power of Python analytics while facilitating effortless collaboration in an Excel-friendly manner. --- ## FAQs: Python in Excel ### How do I connect Excel to Python? Simply type =PY() in an Excel cell and follow it with your Python code. Python in Excel runs on the Microsoft Cloud, seamlessly integrating the two. ### Can I use Python to automate Excel? Yes, with the integration of Python in Excel, you can harness Python's capabilities to automate various Excel tasks and processes. ### Can Python do everything Excel can do? While Python is a versatile programming language with powerful data manipulation libraries, Excel offers unique features like PivotTables and user-friendly interfaces. The integration maximizes the strengths of both. ### Can Python analyze Excel data? Yes, with Python integrated into Excel, you can perform advanced analyses using Python libraries directly on your Excel data. ### How do I use Python automation in Excel? By integrating Python scripts using the =PY() function in Excel, you can automate data processing, analysis, and other tasks right within your workbook. --- ### Join the Finance Alliance Community Sign up to our free [Finance Alliance Slack community](https://www.financealliance.io/community/?%5Fgl=1%2Adyppmw%2A%5Fga%2AODIzNzQwOTAxLjE2ODA5NDY3Mjk.%2A%5Fga%5F2NXFSBEP4N%2AMTY4MTQ4MTgzMi4xMi4xLjE2ODE0ODMyMzIuMC4wLjA.) and start networking with other CFOs and finance leaders. Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. So, what are you waiting for? Sign up today! ### Uncovering the 7 most common FP&A designations URL: https://www.financealliance.io/uncovering-the-7-most-common-fp-a-designations/ Last updated: 2025-04-07T10:07:48.000Z Are you considering a career in financial planning and analysis (FP&A)? If so, then you should be aware of some of the most common FP&A designations available. In this article, we'll discuss and provide an explanation of the main responsibilities and tasks associated with each of them. ### 1\. FP&A Associate The FP&A associate is responsible for **supporting the financial planning and analysis team** within an organization. This may include tasks such as data entry, report generation, and supporting the development of budgets and plans. ### 2\. FP&A Analyst / FP&A Sr Analyst / FP&A Assistant Manager The [FP&A analyst](https://www.financealliance.io/10-mistakes-i-made-as-an-fp-a-analyst/) is responsible for **analyzing financial data and developing financial models** and helping to make informed decisions. This includes forecasting future performance, identifying trends and opportunities, and supporting the development of budgets, forecasts, and management reports. ### 3\. FP&A Manager / FP&A Senior Manager The [FP&A manager](https://www.financealliance.io/fp-a-manager-what-does-an-fp-a-manager-do/) is responsible for **managing a team of analysts** and providing financial insights and recommendations to senior leadership. --- [Rolling forecast best practices | Finance AllianceA rolling forecast formula is a straightforward concept. For every period that passes, a new one is added to the end of the forecast…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/rolling-forecast-best-practices-2.jpg)](https://www.financealliance.io/rolling-forecast-best-practices/) --- ### 4\. FP&A Director / Vice President, FP&A The FP&A director / VP is responsible for **leading the financial planning and analysis function** within an organization. This includes **setting strategic direction** and providing financial insights and recommendations to senior leadership. ### 5\. FP&A Consultant The FP&A consultant is an expert who works with a variety of clients. They analyze financial data and develop recommendations for improving business performance. ### 6\. FP&A specialist / Subject Matter Expert (SME) The FP&A specialist is an expert who has a deep understanding of one particular function or domain or tool, and is responsible for providing specialized support within an organization. ### 7\. Finance Business Partner The role of an [FP&A Business Partner](https://www.financealliance.io/how-finance-business-partners-drive-value/) involves working with internal stakeholders on FP&A activities. They're specialized in one function, for example, Sales Finance Business Partner, Supply Chain Finance Business Partner, or Marketing Finance Business Partner. In conclusion, being aware of these seven most common FP&A designations and the associated requirements can help you assess the FP&A profile better. --- ### **Join our finance community!** The Finance Alliance community is the ultimate space for finance pros who want to accelerate their careers. Connect with our fellow finance leaders to network, discuss and share. Join now to be a part of the conversation. [Join our Slack community](https://www.financealliance.io/community/) ### FP&A Manager salary insights: What the data reveals for 2023 URL: https://www.financealliance.io/fp-a-manager-salary/ Last updated: 2023-10-19T12:19:52.000Z Our latest [Finance Salary Report](https://www.financealliance.io/finance-salary-report/) revealed the average FP&A Manager salary to be ****$76,767** globally and ****$132,500** in the US. Those figures are more than just digits on a screen - they're a testament to the value organizations place on financial planning and analysis. The role of an [FP&A](https://www.financealliance.io/your-ultimate-guide-to-fp-a/) manager is not just about crunching numbers; it's about understanding business dynamics, strategizing for growth, and paving the path to financial success. So, why the disparity in salaries across the globe? 🌎 Why does the US seem to pay a premium? And what factors might push those numbers even higher? Stay with us as we dive deeper into the realm of FP&A compensation. Here's a quick breakdown of what we're about to explore: ### Table of contents: - [FP&A Manager job description](https://www.financealliance.io/p/d2803ae3-6895-441f-8d1c-584a23ea62fc/#what-does-an-fpa-manager-do) - [The average global salary for an FP&A Manager](https://www.financealliance.io/p/d2803ae3-6895-441f-8d1c-584a23ea62fc/#decoding-the-dollars-fpa-manager-salaries-around-the-world-%F0%9F%92%B0) - [Beyond the base: Bonuses, stock options, and more](https://www.financealliance.io/p/d2803ae3-6895-441f-8d1c-584a23ea62fc/#additional-compensation-and-benefits) - [Tip to boost your FP&A salary](https://www.financealliance.io/p/d2803ae3-6895-441f-8d1c-584a23ea62fc/#tips-for-fpa-managers-to-boost-their-salary) Ready to dive into the dollars and cents of the FP&A world? Let's get started.👇🏼 ## ****What does an FP&A Manager do?** An [FP&A manager](https://www.financealliance.io/fp-a-manager-what-does-an-fp-a-manager-do/) serves as a bridge between raw financial data and actionable business strategies. They ensure the company's financial health and steer it toward growth and profitability. They're responsible for analyzing financial trends, advising on decision-making processes, and ensuring the business is on the right track to achieve its financial goals. Typical duties of an FP&A Manager include: - [Budgeting and forecasting](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) - Financial analysis - Variance analysis - [Strategic planning](https://www.financealliance.io/saas-finance-strategies/) - Reporting - Scenario modeling - Collaboration - Process improvement - Stakeholder communication - Performance management - Staff management --- [FP&A Manager: What does an FP&A Manager do? | Finance AllianceBut what does an FP&A Manager do? And what skills do you need to pursue a career in FP&A? In this article, you’ll learn what the main FP&A responsibilities, skills, and traits are to become a value-driven FP&A professional on the road to success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/FP-A-manager-blog.jpg)](https://www.financealliance.io/fp-a-manager-what-does-an-fp-a-manager-do/) --- ## ****Decoding the dollars: FP&A Manager Salaries around the world** 💰 **Disclaimer*: The data below is from our Finance Salary Survey 2023, which was open to a global audience. Below, we have included the data from the portion of respondents who reported their job title to be 'FP&A Manager'. Please keep this in mind.* ![average salary FP&A manager](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/data-src-image-x44710jtnb.png) FP&A Managers are reeling in an average global salary of ****$76,767**. However, experience plays a huge role in these figures. For instance, an FP&A Analyst typically earns a significant amount less than a Senior FP&A manager. Here's what our report concluded: ![salary FP&A manager breakdown](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/data-src-image-ntto30dlne9.png) Every FP&A manager's journey starts somewhere, and for those just stepping into the arena, the lower end of the pay spectrum stands at ****$30,071**. As they blend experience with expertise, mid-level managers see their compensation figures inching upwards, with a median of ****$64,800**. And finally, the average Senior FP&A Manager's salary sits at ****$135,429**. **Note*: This data is from our Finance Salary Report 2023\. Therefore, we have based our findings on the data given to us by our participants. So, it’s not representative of every finance professional, just those who took our survey.* ## The gender gap: A reality check In a world striving for equality, there's still some ground to cover. Our data reveals a disparity with male FP&A managers earning around ****$78,771**, whereas their female counterparts are bringing home ****$68,250** on average. ![FP&A Manager salary by gender](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/data-src-image-6vdqs3wh8vk.png) A conversation that warrants more than just numbers, this gap is a call for introspection and action in the finance world. --- ## Geographical influence 🌎 Different continents, different compensation stories: - ****Asia** \- With its dynamic economies and budding industries, FP&A managers in Asia are drawing an average of ****$55,813.** - ****Europe** \- In Europe, you can expect to see an average salary of ****$75,714** for this position (of course, this varies depending on location and other contributing factors). - ****North America** \- Topping the charts, North America, with its financial hubs and high-stakes marketplaces, rewards its FP&A managers with ****$132,500** on average. ![FP&A Manager salary by region](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/data-src-image-zhg1exi7mue.png) These US figures vary by region and industry. For example, [Glassdoor](https://www.glassdoor.com/Salaries/fpa-manager-salary-SRCH%5FKO0,11.htm) reports an average FP&A Manager salary in the United States being **$113,041** with **$95,642** base pay and around **$17,399** in additional pay. The [Economic Research Institute](https://www.erieri.com/salary/job/fpanda-manager/united-states) reports the Financial Planning & Analysis Manager'ssalary to be around **$131,278** with an average hourly rate of **$63/hr.** Finally, [Salary.com](https://www.salary.com/research/salary/listing/fpanda-manager-salary#:~:text=The%20average%20FP%26A%20Manager%20salary,falls%20between%20%24109%2C030%20and%20%24151%2C464.) states that the average FP&A Manager salary in the United States is $126,292, with a range between **$109,030** and **$151,464.** ## Additional compensation and benefits When asked about satisfaction with their current salary, just ****19.04%** reported being satisfied with their salary while ****61.92%** of respondents said they were unhappy with their current salary. ![FP&A salary satisfaction code](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/data-src-image-k2v4k9bid7.png) ![FP&A manager salary satisfaction](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/data-src-image-rckx5j4d0qq.png) However, while base salaries give us a broad understanding, it's the additional compensation and perks that often paint a more nuanced picture of total remuneration. ### Bonuses For finance pros, bonuses are a significant factor: ![average salary FP&A manager - bonus breakdown overview](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/data-src-image-zzj6jcgbtw9.png) This question was posed to everyone who took part (not just FP&A Managers). A notable ****31%** of finance professionals surveyed reported that their earnings did not come with any bonus. On the brighter side, ****21%** enjoyed a bonus, albeit capped at ****$5,000** ****or less.** ### Perks and benefits FP&A Managers play a critical role in the success of an organization. The work they do is complex and demanding, and it requires a high level of skill, knowledge, and experience. Recognizing their invaluable contributions goes beyond just salaries; it's about the perks and incentives that echo an organization's appreciation. But what's the perk landscape like for finance teams in 2023? Below, you'll see the most prevalent incentives revealed in our survey, and discover how many professionals are actually enjoying these benefits at their workplaces: ![FP&A manager benefits and perks](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/data-src-image-25l6m2yg2cp.png) This question was posed to everyone who took part (not just FP&A Managers) and allowed multiple-choice answers. ## Tips for FP&A Managers to boost their salary ### 1\. Pursue further education and certifications Consider pursuing advanced degrees such as an MBA or specialized finance certifications, such as the Certified Public Accountant (CPA). ### 2\. Specialized training Attend workshops and courses that focus on emerging finance trends, tools, and software to stay ahead of the curve. ### 3\. Network Join finance and industry-specific associations, attend conferences, and actively engage with peers. Networking can open doors to higher-paying opportunities and internal promotions. For example, our free [Finance Alliance Slack community](https://www.financealliance.io/community/) is an online space where finance professionals can network virtually, ask questions, learn from each other, and more. ### 4\. Negotiation skills Regularly review your compensation and be prepared to negotiate during performance reviews or when taking on additional responsibilities. ### 5\. Expand your role Take on cross-functional projects or responsibilities that align with company goals. Demonstrating a broader understanding of the business can position you as more valuable. ### 6\. Stay updated with market trends Regularly benchmark your salary against industry averages using reports like the [Finance Salary Report](https://www.financealliance.io/finance-salary-report/) to ensure you're compensated fairly. ### 7\. Develop soft skills Emphasize and develop leadership, communication, and strategic thinking skills, which can set you apart and position you for higher-level management roles. ### 8\. Seek mentoring Engage with a mentor in the finance field who can provide guidance, advocate for you, and help navigate career growth. ### 9\. Consider geographic relocation If possible, be open to relocating to regions or countries with higher average salaries for FP&A managers. ### 10\. Stay performance-driven Consistently deliver high-quality work, take the initiative, and demonstrate your impact on the business. Quantify your contributions wherever possible. ### 11\. Additional perks and bonuses While base salary is essential, don't overlook negotiating additional compensation elements like sign-on bonuses, performance bonuses, stock options, or other perks. ### 12\. Switch companies Sometimes, the most significant salary bumps come from changing employers. If you feel you've plateaued at your current company, consider exploring opportunities elsewhere. --- ## Want more salary insights? Whether you're charting your own career path or looking to benchmark compensation across the finance sector, our comprehensive [Finance Salary Report 2023](https://www.financealliance.io/finance-salary-report/) holds the answers. Explore in-depth data, salary trends, and insider insights on this role and many others in the finance universe. 🔍✨ [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1000/2023/02/FA_Salary_Report_2023_CTA_Banner.jpg)](https://www.financealliance.io/finance-salary-report/) ### "This community is an invaluable resource for continuous learning" - Valerius Dcunha URL: https://www.financealliance.io/valerius-case-study-slack-community/ Last updated: 2023-08-14T10:37:41.000Z There's a profound saying that the strength of the team is each individual member, and the strength of each member is the team. This couldn't be more accurate for our incredible [finance community](https://www.financealliance.io/community/), which thrives on collaboration, the sharing of insights, and endless opportunities to learn and grow. Recently, we had the pleasure of sitting down with one of our esteemed community members, [Valerius Dcunha](https://www.linkedin.com/in/valerius-d/), the Founding Member at FinFloh. Passionate about his work and an ardent believer in the power of community, Valerius was gracious enough to share some reflections on his experience with us. As you read on, you'll discover the tangible benefits of being part of a community that not only shares a common passion for finance but is also deeply committed to ensuring every member succeeds. ### What is your background and experience with finance? With a background encompassing diverse roles across the banking and fintech sectors, including Sales, Partnerships, and Consulting, I've acquired profound insights into the intricate workings of the financial landscape. My focus on secure and seamless payment solutions has led me to a pivotal role within a tech startup's founding team. Harnessing my skills and extensive network, I am dedicated to propelling innovation in the B2B SaaS Finops realm. [“It was outstanding, the topics were very interesting.” - Ahmed MorsyWe recently wrapped up another exciting FP&A Summit and this time, it was a virtual event, which meant lots of different finance professionals from around the world attended.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceFinance Alliance![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/ahmed.png)](https://www.financealliance.io/virtual-event-case-study-ahmed-morsy/) ### What was your motivation for joining our community? Forge connections and establish a robust global network with finance professionals spanning various corners of the world. > "This vibrant community offers an exceptional opportunity and platform for cultivating meaningful relationships, sharing insights, and fostering collaborative growth within the finance realm." ### What have you enjoyed most since joining? The thrill of embarking on a journey to connect with like-minded professionals and potential partners who perfectly resonate with our target market. It's like putting together a puzzle of possibilities while savouring the excitement of every piece falling into place. ### What type of discussions have you found the most insightful and useful? I've stumbled upon captivating threads that pique my interest, such as discussions about revolutionary [financial transformation tools ](https://www.financealliance.io/what-is-finance-transformation/)that have the potential to reshape the way businesses manage their operations. These conversations ignite a spark of curiosity and inspire exploration into the cutting-edge solutions driving innovation across industries. [Chris Ortega Speaker Testimonial | Finance Alliance“I wanted to create an open conversation, which I think is a unique aspect of this conference compared to others. It was less about PowerPoint and more about open dialogue and communication.”![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/FP-A-Summit-case-study.png)](https://www.financealliance.io/chris-ortega-shares-his-experience-as-a-speaker-at-fp-a-summit/) ### Have you built up any new connections? Indeed, I've established some valuable connections, a mix of gems that might not perfectly fit my objectives, but that's where the magic lies! > "Engaging with fresh faces and exploring various facets of finance problems not only enriches my journey but also adds a dash of intrigue and adventure." ### How has the community impacted your professional growth? As a devoted finance professional, immersing myself in this community not only improves my networking game but also helps me stay at the forefront of global innovations. ### How would you describe the culture of the community? I've found the community to have a warm and amicable atmosphere, fostering an environment of openness and a strong sense of camaraderie. > "Members are not only approachable and friendly but also display a remarkable willingness to offer assistance and support to one another." ### How do you see the value of this community in comparison to other professional networks you're part of? When evaluating the worth of this community in relation to my involvement in other professional networks, its exceptional value becomes evident through the continuous interactions and timely updates shared by members. These elements not only amplify the potential for acquiring valuable knowledge and engaging in meaningful discussions but also foster a unique atmosphere of active involvement and interconnectedness. [Why you should join our finance community | Case Study | Adam TzagourisIt’s great to be around other Finance folks that have a wide array of experiences in different industries. That way, you get the most useful takeaways from each and can make them your own.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/FA_Case_Study_Template-5-2.png)](https://www.financealliance.io/adam-tzagournis-community-case-study/) ### Why should other finance professionals join our free Slack community for finance professionals? I highly recommend others in the finance industry to join the Finance Alliance community because it not only offers a guided pathway for professional growth within the finance realm but also serves as an enlightening arena to observe how different organizations effectively manage various facets of their processes. > "It's an invaluable resource for continuous learning and a platform for exchanging strategies that can significantly elevate one's career in the financial landscape." --- ### Join our finance community Become a part of our exclusive [Finance Alliance Slack community](https://www.financealliance.io/community/) at no cost. Connect with global CFOs and eminent finance trailblazers. Exchange insights, seek guidance, unearth promising talent, and expand your circle amidst a bustling hub of world-class finance experts. Why wait? Embark on this journey with us now. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### Budget vs Annual Operating Plan (AOP): Understanding the key differences URL: https://www.financealliance.io/budget-vs-annual-operating-plan/ Last updated: 2026-01-21T11:15:24.000Z A budget and an annual operating plan (AOP) are both financial tools used by organizations to manage their performance. It's important to note that a budget and an operating plan are *not* the same thing, but they are closely related. ## What is a Budget? A budget is a financial tool that shows the resources an organization has available to spend. ## What is an Annual Operating Plan? An operating plan is a more comprehensive plan that shows how the organization intends to use those resources to achieve its goals. --- [Rolling forecast best practices | Finance AllianceA rolling forecast formula is a straightforward concept. For every period that passes, a new one is added to the end of the forecast…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/rolling-forecast-best-practices-2.jpg)](https://www.financealliance.io/rolling-forecast-best-practices/) --- ## Budget vs Annual Operating Plan The [budget](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/) provides the financial foundation for the operating plan, and the operating plan provides the context for how the budget will be used. ### Think of budget as a map It outlines the financial resources (money) an organization has available. And how they will be used to reach their destination (goals). A map shows the roads and routes to take to reach a destination. Similarly, a budget shows the financial resources and expenditures needed to reach the organization's goals. ### Think of the Annual Operating Plan as an itinerary Think of an annual operating plan as an itinerary for a trip. The itinerary outlines the destination (goals), the activities (strategies) that will be done at each destination, and the time frame for each activity (initiatives). An itinerary provides the context for the trip and helps ensure that the resources (money) are being used effectively to achieve the goals. > **A budget focuses on the financial resources, while an operating plan focuses on the goals, strategies, and initiatives.** Together, they help ensure that the organization's resources are being used effectively to achieve its goals. --- [Budgeting vs forecasting: Understanding 20 key differencesWhen it comes to guiding decision-making, allocating resources, and ensuring an organization’s long-term financial stability. Budgeting and forecasting are two crucial FP&A activities. Forecasting and budgeting are connected but separate activities with differing goals, methods, and results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/EGGS.jpeg)](https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/) --- ### Financial plan vs comprehensive plan A budget is a plan that shows how an organization will spend its money over a certain period of time, usually a year. An AOP, on the other hand, is a [comprehensive plan](https://www.financealliance.io/the-financial-planning-analysis-chasm/) that outlines an organization's objectives, strategies, and initiatives for the upcoming year. ### Level of detail **Budgets are more detailed** and provide detailed information on how money is being spent and how much is being spent. **An AOP is high-level but more comprehensive** and provides a broader view of the organization's objectives and strategies. ### Focus A budget focuses on the **financial aspect** of an organization, whereas an operating plan focuses on the **operational aspect**. ### Time horizon A budget is typically prepared for a single year, while an operating plan may cover a multi-year period. ### Uses A budget is used to control spending and ensure that resources are being used effectively. An operating plan is used to guide decision-making and ensure that the organization's objectives are being met. ### Involvement A budget is usually prepared by the finance department and approved by senior management. An operating plan may involve input from a wider range of stakeholders, including department heads and employees. ### Monitoring A budget is used to monitor and control spending, while an operating plan is used to monitor progress towards organizational objectives. --- [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) --- ### How do budgets and operating plans work together? By integrating the budget and the [operating plan](https://www.financealliance.io/operational-finance/), organizations ensure that: - It has the resources it needs to successfully execute its strategy. - Its resources are being used effectively to achieve its goals. An operating plan and a budget are closely related and should be integrated to ensure that the organization's resources are effectively used to achieve its goals. A budget without an operating plan is like a roadmap without a destination, and an operating plan without a budget is like a destination (goal) without a road map (budget) to support it. ### For example: An organization's operating plan calls for the expansion into a new market; the budget will allocate the necessary resources (e.g. capital expenditures, marketing expenses, and personnel expenses) to support that expansion. In conclusion, [budgets and operating plans](https://www.financealliance.io/scaling-your-saas-finance-operations/) are two important financial tools that work together to help organizations effectively manage their finances and achieve their goals. By using both tools in conjunction, organizations can ensure that their resources are being used effectively to achieve their objectives. --- ## **Become a pro at budgeting & forecasting** Learn the cutting-edge budgeting and forecasting techniques that top finance professionals use to guide strategic decisions. Join **Christian Wattig**, a seasoned FP&A expert, as he walks you through the entire budgeting process—from Pre Kick-Off to Final Alignment—and teaches you how to create forecasts that inform and empower leadership. In this [certified course](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters), you’ll gain access to detailed video lessons, slides, and practical resources to help you refine your financial planning skills and drive impactful decisions within your organization. [Sign up today](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### Journey to CFO eBook URL: https://www.financealliance.io/journey-to-cfo-ebook/ Last updated: 2025-04-04T14:38:12.000Z Take the first step on your road to the C-Suite.👇 Whether you're an aspiring finance professional or a seasoned veteran aiming for the top, this eBook is more than just a guide - it's your golden ticket to the C-suite. You’ll not only learn about the critical skills to master for the role, but you’ll also hear from accomplished CFOs who share their wisdom, experiences, and personal anecdotes to help you achieve the same level of success. ## What’s in this eBook? - **The secrets of the CFO role:** Get the inside scoop on the essential traits and skills needed to lead at the highest level. - **Explore the intricacies of educational backgrounds and professional qualifications**, and learn how to strategically leverage your expertise to ascend the ranks. - **Navigate the competitive job market** and ace the interview process with insider tips and expert guidance. - **Developing essential CFO skills:** Master the skills that every successful CFO needs in their arsenal. - **Developing an action plan:** Forge a strategic path towards your goal with a clear, actionable plan. Your extraordinary journey to the C-suite starts right here, at your fingertips. ### Rolling forecast best practices: Bridging the gap between strategy & execution URL: https://www.financealliance.io/rolling-forecast-best-practices/ Last updated: 2026-03-11T11:37:24.000Z ## **What is the difference between a rolling forecast vs static forecast?** Static forecasts are like fixed financial blueprints. You lay out expected revenues, costs, and profits at the start of the year, and even if things change in the market, the forecast stays the same. Rolling forecasts, on the other hand, are highly adaptable. For instance, if your sales skyrocket in the first quarter, you can adjust the forecasts for the following months accordingly. Having this adaptability at your fingertips can prove useful for accurate financial planning and yet many finance pros remain adamant that static forecasts are the way to go. But… are they right? Or is it time to move away from traditional methods of forecasting? We want to help you decide by diving deep into rolling forecasts, their flexibility, responsiveness to real-time data, and how these features can directly contribute to your company's strategic decision-making process. So, if you’re ready to roll with the changes in the financial forecasting landscape, let's get stuck in. ## Types of rolling forecasts There are a few main variations of rolling forecasts commonly used in financial planning and analysis (FP&A). They include: 1. **Standard rolling forecasts:** Think of this as a moving window that always covers the next 12 months. As one month ends, like when July wraps up, the forecast rolls to include the next July. It gives a constantly updated year-long view. 2. **Quarterly rolling forecasts:** Similar to standard, but we're talking in quarters here. Each quarter, the forecast period moves forward by one quarter, keeping a constant 12 month outlook. 3. **Continuous rolling forecasts:** Instead of fixed monthly or quarterly updates, this forecast operates in real-time. Whenever new data enters, it adjusts. 4. **Extended-horizon forecasts:** Some businesses like to gaze farther – maybe 18 or even 24 months ahead. Even though it's a long view, they keep it fresh with regular updates. 5. [**Driver-based forecasts**](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/)**:** This forecasting method uses key performance drivers to predict future revenues and costs. The main drivers of a business, such as number of customers, sales per customer, marketing expenses, etc., are identified and then used to estimate future financial performance. Instead of a fixed period, like an annual forecast, a rolling forecast 'rolls' with the times. --- [Top-Down vs. Bottom-Up Forecasting | Finance AllianceTop-down vs bottom-up forecasting: Which method should you use to create accurate sales forecasts? Find out in this article.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/FA-Infographics_Forecasting.jpg)](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) --- You can use a rolling forecast to predict a variety of figures and areas of the business. For example… A **rolling cash flow forecast** focuses on your company's liquidity and how much cash is coming in and going out. A **rolling financial forecast** is more holistic than the cash flow version. This one encompasses *all* financial aspects - revenues, expenses, assets, and liabilities. It's the bigger financial picture that continually evolves. A **rolling sales forecast** concentrates on sales projections. It’s vital for marketing and inventory decisions. You can think of it as a pulse check on customer demand and market trends. A **rolling forecast budget** adjusts throughout the year. As situations change, so does the budget, making it a more adaptive financial tool. *FYI: You may come across the term ‘running forecast’. This is a synonym for rolling forecast, underscoring its continuous, 'running' nature. But it’s essentially the same as a classic rolling forecast.* ## **The rolling forecast formula** A rolling forecast formula is a straightforward concept. For every period that passes, a new one is added to the end of the forecast. So, if you're using a 12-month rolling forecast, at the end of January, February becomes your starting point, and the following January is added, maintaining a consistent 12-month outlook. ### **When is a rolling forecast needed?** - **Business agility:** In rapidly changing industries, where the landscape can shift in just a few months, it’s essential to have a forecast that evolves to reflect the latest conditions. - **Long-term projects:** For projects that span several months or even years, it's useful to always have a clear forward-looking window that updates regularly. - **Managing seasonality:** Businesses in sectors with pronounced seasonality, like retail or agriculture, can benefit from a rolling forecast to adjust projections in real time. ### **Why is a rolling forecast useful?** - **Real-time adaptability:** As businesses face unexpected challenges or opportunities, rolling forecasts can be adjusted in real time, ensuring they’re based on the latest data. - **Continuous planning:** Instead of yearly budgeting and planning, companies can continually refine their strategies, allowing them to stay ahead of the curve. - **Stakeholder confidence:** For stakeholders, whether they're investors, partners, or board members, seeing an always-current forecast can instill greater confidence in the business's management and direction. --- [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) --- ## **Who benefits from rolling forecasts?** For companies that face swift currents of change, rolling forecasts help ensure they steer clear of risks and are ready to seize opportunities as they come. Let's dive into which businesses can best harness their power… ### Dynamic market players If your company thrives in environments that are always shifting due to seasonality, growth spurts, or economic swings, rolling forecasts are your best bet. An example would be a retailer that needs to frequently update sales forecasts. ### Skyrocketing startups With rolling forecasts, growing startups can keep pace, ensuring they're always ahead of the curve. ### Project-based businesses For those in the project domain - like consultants or construction magnates - revenue comes in bursts, often aligned to project milestones. [Rolling forecasts ](https://fpa-trends.com/article/rolling-forecast-7-factors-success)help these businesses sync their finances with their project timelines. ### Highly leveraged companies Companies with complex debt structures involving covenants should use rolling forecasts to closely monitor cash flows and covenant compliance. ### Companies with long budgeting cycles If you're used to the tradition of annual budgets, rolling forecasts offer a breath of fresh air. No more waiting a year to rejig those numbers; you can now adapt on-the-go. ### Companies adopting agile frameworks Agile teams want rapid insights to guide decisions. Rolling forecasts provide updated data more aligned with agile sprints. ## **Knowing when to use a rolling vs a static forecast** Recognizing the right moment to shift from a static forecast to a rolling forecast can make all the difference in financial planning. You’ll notice some cues to reveal when it’s time to leave static forecasts in the past and move to rolling forecasts. For example, if you notice your business environment or internal operations are changing more frequently than your static forecast can accommodate, take it as a sign it’s time to consider a more adaptive approach. The same goes for when your business is in a phase of rapid growth or expansion. This is a perfect example of when a rolling forecast offers the responsiveness you need. Some other signs of when to use a rolling forecast include: **Economic uncertainty:** If your industry or region faces volatile economic conditions or is susceptible to unexpected external factors (like natural disasters or geopolitical events), rolling forecasts can provide a clearer lens. **Complex projects:** Are your revenues and costs associated with long-term, complex projects? Rolling forecasts can help you keep pace with project-based financial fluctuations. **Feedback loop:** If you're consistently adjusting and tweaking your static forecasts or if there's a significant deviation between forecasts and actuals, it's an indication that a rolling model might be more suitable. **Strategic flexibility:** Businesses aiming for a more agile strategic approach, where pivots and shifts are common, will find rolling forecasts more aligned with their goals. **Stakeholder expectations:** If investors, board members, or other stakeholders demand more frequent and updated financial insights, rolling forecasts can meet this need. **Technological infrastructure:** If you've recently upgraded your financial systems or have access to real-time data analytics, you're in a prime position to harness the benefits of rolling forecasts. **Budgeting fatigue:** If the annual budgeting process feels like a drain, both in terms of time and relevance, introducing a rolling forecast can inject efficiency and relevance back into the process. **Competitive landscape:** If competitors are rapidly innovating, launching new products, or entering and exiting markets, maintaining a rolling forecast can help you stay a step ahead. Remember, while rolling forecasts offer adaptability, they also demand more frequent attention. Weigh the benefits of real-time adaptability against the resources required for regular updates. Sometimes, a hybrid model – combining elements of both static and rolling forecasts – might be the best fit. --- ## **How to create a rolling forecast** The way one finance team creates a rolling forecast may differ from another. But the steps are often similar, following a sequential order to help create the best possible rolling forecast model. Here are the typical steps to create and maintain a [rolling forecast for a company's finances](https://www.financealliance.io/should-you-use-rolling-forecasts-weighing-the-pros-and-cons/): ### 1\. Set clear objectives Begin by mapping out your destination. Why are you embarking on this journey of forecasting? Determine who will be relying on these projections and for what decisions. ### 2\. Choose forecast frequency Decide on the duration your forecast will cover and establish its recurring increments. For instance, if you opt for monthly increments spanning 12 months, as each month concludes, it's phased out, and a new month takes its place. ### 3\. Zoom in or out on details Depending on the vastness of your trek (length of the forecast), you might want to pack light (less detail) or be more prepared (detailed). Especially when the stakes are high, ensure precision and comprehensive detailing. ### 4\. Pinpoint key value drivers Instead of trying to conquer every aspect of the business, identify those pivotal to your journey's success. Recognize the elements that historically and currently drive value in your business and industry. ### 5\. Gather and verify data Create a rolling forecast model to analyze historical data and project future revenues, expenses, capex, etc. Identify [key cash flow drivers](https://www.financealliance.io/cash-flow-drivers-in-a-business/). Determine what data is needed from each business unit or department to populate the forecasts. This may include sales projections, hiring plans, operating costs, etc. Remember, the data you rely upon for your forecasts is your sustenance. Ensure its quality is top-notch, sourced from credible origins. ### 6\. Compile forecasts and create scenarios Foresee various paths your journey might take based on certain conditions and drivers. This foresight allows preparation for various eventualities, ensuring better adaptability. As the winds shift, adjust your path accordingly. ### 7\. Measure, assess, and adjust As you journey on, periodically check your actual path against the forecasted one. Are there any deviations? If so, work to understand the reasons and recalibrate. This continuous checking ensures you're always on the right path or equipped to pivot when necessary. You may also want to share results with stakeholders and executives. Discuss variances, opportunities, and risks. ### 8\. Move the model forward Move the model forward one period, update inputs, and compile a new forecast on the predetermined frequency. Continue to compare the actual results to your forecasts to improve the process and inform future projections. ## **Tips: Creating a rolling forecast in Excel** Microsoft Excel is an excellent platform for building rolling forecasts due to its flexibility and power for financial modeling. With Excel, you can leverage historical trends, driver-based modeling, and sensitivity analysis to create robust 12-month or longer rolling forecast models. The "rolling forecast excel" structure allows new data to be input each period to move the forecast forward seamlessly. Teams can use "12-month rolling forecast excel templates" tailored to their needs while benefiting from Excel's shared language and accessibility. These templates allow new time periods to be appended while previous periods drop off, maintaining a 12-month rolling projection. Some tips to help create better rolling forecasts in Excel include: - **Data gathering:** Start by collecting historical data on sales, expenses, and any other relevant metrics. - **Setup timeframes:** Decide on the forecasting period (e.g., 12 months) and set up columns for each month/quarter. - **Formulas:** Use the OFFSET and COUNTA functions to dynamically select the most recent data points. - **Drop-off logic:** Implement logic where, as a new month/quarter is added, the oldest one drops off. - **Input section:** Designate a section of the worksheet for inputting new data as it becomes available. - **Visuals:** Incorporate charts/graphs that update automatically with the rolling forecast for a visual representation. - **Scenario analysis:** Use Excel's scenario manager for what-if analysis based on different variables. - **Consistent updating:** Regularly input new data to keep the forecast current and rolling. - **Error checks:** Implement conditional formatting to highlight any anomalies or unexpected results. - **Protection:** Protect cells with formulas to avoid accidental edits, while leaving input cells open for data entry. --- [14 dos and don’ts for an accurate financial forecastPreparing an accurate financial forecast demands precision, attention to detail, and a clear understanding of the economic landscape. Below, we’ve curated seven dos and seven don’ts to fine-tune your forecasting process.👇![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/dos-and-don-ts-finance-forecast-2.jpg)](https://www.financealliance.io/14-dos-and-donts-financial-forecast/) --- ## **Why are rolling costs difficult to predict?** Predicting rolling costs can be difficult because they’re influenced by multiple factors that can change at any time. The very nature of businesses, especially those operating in fast-paced environments, means that variables like demand fluctuations, supply chain disruptions, regulatory changes, and economic shifts can all impact costs. Not only that, but these variables often interplay in complex ways, making their combined effects even harder to anticipate. While rolling forecasts aim to offer a more adaptive approach to financial planning, the inherent volatility and interconnectedness of business factors can make [rolling costs ](https://www.financealliance.io/3-cash-flow-forecasting-challenges/)elusive to accurately predict. ## **Rolling forecast best practices** To optimize the process and get the most accurate and actionable insights, consider these 10 best practices: ### **Embrace flexibility** The very essence of a rolling forecast is its adaptability. Business environments change, and your forecast should be nimble enough to adjust accordingly. Instead of being anchored to fixed periods, it should flow with real-time data and updates. ### **Prioritize key metrics** While it's tempting to include every imaginable data point, it’s wiser to focus on the key performance indicators (KPIs) that drive your business. Determine which metrics matter most to your organization's success and build your forecast around them. ### **Consistent data collection** Uniformity in data gathering is paramount. Ensure that the data you use is consistently sourced, processed, and interpreted. Any discrepancies can lead to skewed results. ### **Collaboration is key** Financial forecasting isn’t just for the finance department. Engage multiple departments and stakeholders, as they provide varied insights that can lead to a richer, more comprehensive forecast. ### **Regularly review and revise** The "set it and forget it" approach won't do. Regularly compare your forecasts with actual outcomes. Understand discrepancies, learn from them, and refine your forecasting model accordingly. ### **Simplicity over complexity** While detailed forecasts can be insightful, they can also become overly complex and difficult to navigate. Aim for a balance: detailed enough to be actionable, yet simple enough to be comprehensible. ### **Leverage technology** Take advantage of forecasting software and tools available today. They can automate data collection, offer advanced analytical capabilities, and provide visualization aids, streamlining the entire process. ### **Scenario analysis** Forecasting isn’t about predicting a single future but understanding a range of possible outcomes. Engage in scenario planning to assess how different factors might influence outcomes. This practice helps in preparing for both opportunities and threats. ### **Continuous learning** Like all skills, your forecasting abilities will improve with experience and reflection. Create a feedback loop where you constantly evaluate past forecasts, learn from mistakes, and continually refine your techniques. ### **Educate and communicate** Ensure that everyone involved understands the purpose, process, and outcomes of rolling forecasts. Transparent communication helps align the organization around shared objectives and insights. --- ### FAQs: Rolling forecast best practices What is the difference between a forecast and a rolling forecast? A traditional forecast is usually set for a fixed period, like a fiscal year, and doesn't change until the next period. A rolling forecast, on the other hand, is continuously updated, typically by dropping the oldest period and adding a new one at the end. How do you create a 12-month rolling forecast? Start with data for the current month, then forecast the next 11 months. Each subsequent month, drop the oldest data and add a new forecast month at the end, ensuring you always have a 12-month view. What is the definition of a rolling forecast? A rolling forecast is a financial projection method where forecasts are continuously updated by extending the forecast period by a set interval, usually monthly or quarterly. Why is Excel recommended for rolling forecasts? Excel offers flexibility, familiarity, a rich array of formulas, visualization tools, and integration capabilities, making it adept for creating and updating rolling forecasts. --- ## Level up your budgeting & forecasting skills with our certified course Enhance your skills in [budgeting and forecasting](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) with expert techniques used by top companies worldwide. Learn from **Christian Wattig**, an experienced FP&A leader, and gain insights into the five essential phases of budgeting and the forecasting strategies that help businesses stay ahead. With Christian as your guide, you’ll get hands-on experience navigating the key steps of annual budgeting, from Pre Kick-Off to Final Alignment, and gain the confidence to create accurate forecasts that support strategic decision-making. **Enrol now** to start mastering the financial tools that make you an indispensable part of your organization! [Sign up](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### 14 dos and don’ts for building an accurate financial forecast URL: https://www.financealliance.io/14-dos-and-donts-financial-forecast/ Last updated: 2025-10-10T08:31:26.000Z Preparing an accurate financial forecast demands precision, attention to detail, and a clear understanding of the economic landscape. But it's not just about the numbers. It's about knowing what to do (*and what not to do*)to ensure the accuracy and relevance of your forecast. Below, we've curated seven dos and seven don’ts to fine-tune your forecasting process.👇 ![Financial forecasting dos and don'ts](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/FA-GRAPHIC-1.png) ## Do… ### 1\. Use historical data **Why:** Think of historical data as the footprints left behind on a trail. They show you where you've been and help guide where you're going. It's your chance to learn from the past.⌛ **Example:** Let's say you're working in a SaaS ([Software as a Service](https://www.financealliance.io/saas-finance-strategies/)) company. By looking at your historical churn rates (the percentage of customers who stop using your software), you can forecast future churn rates. If you've been experiencing an average churn rate of 5% per quarter for the past two years, and there are no major changes in your market or business model, you could reasonably forecast a similar churn rate for the next few quarters. This allows you to make informed decisions about customer retention strategies and calculate the number of new customers you need to maintain or grow your business. 💡 ****Tip:** Don't get trapped in the past, though. Use historical data as a foundation and adjust for current conditions. --- ### 2\. Involve key stakeholders **Why:** Many hands make light work, as the saying goes. Forecasting is a team sport, and including different departments ensures all angles are covered. **Example:** If you're planning your company's [cash flow forecast](https://www.financealliance.io/3-cash-flow-forecasting-challenges/), involving the sales department can provide insights into expected deals closure, while your HR team can inform you about potential hiring or restructuring costs. At the same time, the product department can share updates about upcoming launches or enhancements that might attract new customers or impact revenue. By inviting inputs from these different stakeholders, your financial forecast will be much more comprehensive and accurate. 💡 ****Tip:** Encourage open communication and make everyone's voice heard. More perspectives usually lead to a more rounded view. --- ### 3\. Regularly update forecasts **Why:** Your financial forecast isn't a static painting, it needs to change and grow with your business. **Example:** Imagine your company secures a significant new client halfway through the year, resulting in a substantial increase in your projected revenues. If you stick to your original sales forecast without updating it to account for this new development, you might miss out on opportunities to strategically reinvest this additional revenue *back* into your business. 💡 ****Tip:** Set reminders or specific checkpoints throughout the year to revisit your forecasts. Stay agile! --- [CFO interview questions and answersIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/CFO-interview-questions-2.jpg)](https://www.financealliance.io/cfo-interview-questions-and-answers/) --- ### 4\. Conduct sensitivity analysis **Why:** It's like testing your ship for leaks before setting sail. You're exploring how different scenarios might impact your forecast, preparing for the unknown. ⛵ **Example:** What if fuel prices skyrocketed by 20%? By running a sensitivity analysis, you could see the projected increase in your operating expenses. On the flip side, what if fuel prices were to drop by 10%? The analysis would show you the potential savings you might enjoy. 💡 ****Tip:** Don't be afraid to play with the numbers; it's about preparing, not predicting every possibility. --- ### 5\. Monitor external factors **Why:** Your business isn't an island; it's affected by the world around it. Keeping an eye on the broader landscape ensures you're not blindsided. **Example:** Consider a coffee shop chain; political instability in coffee-producing regions might affect coffee bean prices. That's an external factor worth monitoring. Another example is if you were a CFO at a technology firm (or any firm, really) that was heavily invested in the cloud services space. A crucial external factor for you would be regulatory changes in data privacy laws, such as GDPR ([General Data Protection Regulation](https://gdpr-info.eu)) in Europe or CCPA ([California Consumer Privacy Act](https://oag.ca.gov/privacy/ccpa)) in the United States. If there are indications that a new country is planning to implement strict data privacy laws, it may impact how you can offer and price your cloud services in that market. Monitoring these external regulatory changes will allow you to adjust your financial forecasts, taking into account potential compliance costs or changes in revenue projections. 💡 ****Tip:** Keep your ear to the ground and be aware of changes in your industry, economy, and regulatory environment. --- ### 6\. Review and validate assumptions **Why:** Assumptions are the roots of your forecast. If these assumptions are flawed or unvalidated, your entire forecast becomes unreliable, potentially leading to misinformed decisions that can adversely affect your company's financial health. **Example:** You may assume your business will grow revenue by 15% next quarter because you're launching a new product. However, this assumption shouldn't be based solely on optimism or past successes. It's crucial to validate this projection with solid data - perhaps you've conducted market research showing high interest in the product, or maybe your sales team has gathered promising feedback from key clients. By continually reviewing and validating your assumptions, you ensure that your [financial forecasts](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/) are not only based on realistic expectations but are also more likely to withstand scrutiny from stakeholders. 💡 ****Tip:** Regularly revisit and question your assumptions. They need to be as solid as possible. --- ### 7\. Communicate results **Why:** A forecast kept under lock and key doesn't help anyone. It's a tool for the whole company to use and understand. **Example:** A clear presentation of the forecast to different departments can spark valuable insights or ideas and help align everyone's goals. Let's imagine you've forecasted a 25% increase in sales revenue for the next quarter based on expected market conditions and new product launches. Sharing this forecast with the Marketing team can help them plan their strategies to effectively support this growth. They might consider boosting advertising campaigns or crafting more targeted promotions to reach a larger audience. 💡 ****Tip:** Keep it simple and clear. Use visuals and be ready to answer questions. The more people understand, the more they can contribute. --- [How to become a virtual CFO | Finance AllianceImagine having the opportunity to use your financial expertise to guide businesses globally, from the comfort of your home or any remote location (sunny beach in the Caribbean, anyone?). As a Virtual CFO or ‘vCFO’, you can do just that.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/08/how-to-become-a-virtual-cfo-2.jpg)](https://www.financealliance.io/how-to-become-a-virtual-cfo/) --- ## Don't… ### 1\. Rely on a single forecast **Why:** Putting all your eggs in one basket is a risky move. A single forecast can't account for all the uncertainties your business might encounter. **Example:** Imagine you run a tourism-based business. You wouldn't want to rely solely on a rosy forecast without considering potential disruptions, like a resurgence of travel restrictions due to a health crisis (*remember Covid?*). 💡 ****Tip:** Embrace the power of scenarios. Explore the best case, worst case, and most likely outcomes. --- ### 2\. Ignore historical patterns **Why:** While it's important to look forward, ignoring the rearview mirror can lead to blind spots in your forecast. **Example:** Let's say you're an FP&A professional at a software company that operates on a subscription-based model. Over the years, you've noticed a recurring pattern of increased subscription renewals and new customer acquisitions at the start of each fiscal year, likely due to many businesses setting their budgets for the year during this time. Ignoring this historical pattern could lead to an underestimation of your revenue forecast for the first quarter. Therefore, when planning for the next fiscal year, it would be critical to take this seasonal trend into account to ensure that your revenue forecast is as accurate as possible. This would allow your company to plan and allocate resources more efficiently. 💡 ****Tip:** Be mindful of the rhythms in your business and incorporate them into your forecast. --- ### 3\. Overlook risks and uncertainties **Why:** The future is murky and filled with unknowns. Not considering potential risks in your forecast is like walking on a tightrope without a safety net. **Example:** A significant supplier going out of business could dramatically impact your production line. 💡 ****Tip:** Stay aware and agile. Plan for uncertainties and have contingency strategies ready. --- ### 4\. Disregard feedback **Why:** Feedback is a goldmine of insights. Ignoring it can lead to missed opportunities for refinement and improvement. **Example:** As a finance professional, one of your key responsibilities is managing and forecasting the company's cash flow. The Sales team, for instance, could provide valuable feedback on their latest client interactions. Let's say they've been hearing that some clients are struggling with payment deadlines due to market conditions. If you disregard this feedback, your forecast for cash inflow might be overly optimistic, leading to potential liquidity issues down the line. By taking this feedback into account and adjusting the expected payment timings in your [cash flow forecast](https://www.financealliance.io/cash-flow-drivers-in-a-business/), you can avoid potential surprises and ensure that you have a more accurate understanding of your company's future financial position. This more accurate forecast could then be used to renegotiate payment terms with clients or arrange for necessary financing ahead of time. Such proactive financial management can enhance business stability and give your stakeholders increased confidence in your company's financial forecasts. 💡 ****Tip:** Create an open environment for feedback. It's a two-way street that leads to more accurate forecasting. --- [How to create a CFO mission and vision statementIn this blog post, we shed some light on how an established vision can drive success for your company. We’ll also share some CFO mission and vision statement examples and teach you how to create one of your own.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/07/CFO-Mission-header-image-2.jpg)](https://www.financealliance.io/cfo-mission/) --- ### 5\. Forget to validate data **Why:** Garbage in, garbage out. If your data isn't accurate, your forecast won't be either. **Example:** A sudden spike in sales might be due to a one-off bulk order, not a trend. Including this in your forecast without [data cleaning and validation](https://www.financealliance.io/data-cleaning-techniques/) could skew your results. 💡 ****Tip:** Always clean and validate your data. It's worth the extra effort. --- ### 6\. Neglect regular reviews **Why:** A forecast is not a one-and-done deal. Without regular check-ins, your forecast might become outdated or irrelevant. **Example:** A newly signed contract with a big client should trigger a review and potential adjustment of your sales forecast. 💡 ****Tip:** Mark your calendar for regular review sessions. Your future self will thank you! --- ### 7\. Underestimate assumptions’ impact **Why:** Even small changes in your assumptions can cause big swings in your forecast. Ignoring this can lead to unpleasant surprises. **Example:** Suppose you're a CFO for a company with significant reliance on raw materials, like a manufacturing or construction company. You've assumed a stable cost for these raw materials in your financial forecast. However, market conditions can be unpredictable, and even a slight increase in raw material costs can have a significant impact on your cost of goods sold (COGS) and, consequently, your profit margins. For instance, if raw material costs increase by just 5%, this could lead to a substantial drop in your profit margin, especially if these costs represent a large portion of your total expenditure. Underestimating the impact of such an assumption in your forecast could result in an overestimation of your future profits, potentially leading to misinformed decision-making about investments, growth strategies, or shareholder dividends. By acknowledging and carefully considering the potential impact of your assumptions, you can create more robust and reliable financial forecasts, capable of better withstanding unexpected market shifts. 💡 ****Tip:** Be aware of how sensitive your forecast is to changes in key assumptions. Monitor them closely! --- ### FAQs How often should I update my financial forecasts? There's no one-size-fits-all answer, but generally, a quarterly review and update is a good starting point. However, if significant changes occur in your business or market environment, you should update your forecasts accordingly. How far into the future should my financial forecast extend? It depends on the nature of your business and industry. However, a 12-month forecast is commonly used for operational planning, while a 3-5 year forecast can be useful for strategic planning and investor relations. How can I improve the accuracy of my financial forecasts? Regularly review and update your forecasts, validate your data, and ensure your assumptions are realistic. Involving key stakeholders and incorporating their insights can also improve forecast accuracy. What do I do when unforeseen factors affect my financial forecast? When unexpected events occur, it's time to reassess your forecasts. Adjust your assumptions, consider the impacts, and revise your forecasts to reflect the new reality. It's all part of staying agile and responsive. What factors should be considered when preparing financial forecasts? When forecasting, you should take into account historical data, current market conditions, feedback from stakeholders, potential risks and uncertainties, and the impact of external factors. It's also crucial to validate your data and assumptions. What are some common mistakes made when forecasting financial statements? Some common pitfalls include relying too heavily on historical data without considering current market trends, overlooking external factors, and ignoring risks and uncertainties. It's also common to see over-optimistic or overly conservative assumptions that don't align with reality, as well as lack of regular reviews and updates. --- ### Keep up with us! Keep up with the latest releases on the Finance Alliance blog and podcast and be the first to know about upcoming events, reports, and industry news! [Subscribe to The Monthly Balance newsletter.](https://www.financealliance.io/finance-newsletter/) [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### How to become a virtual CFO URL: https://www.financealliance.io/how-to-become-a-virtual-cfo/ Last updated: 2025-04-10T07:57:46.000Z Wouldn’t it be great if you could work with clients around the world, unburdened by location, traditional office hours, or geographical limitations? Well, for today's CFOs, this isn’t merely a pipe dream, but a tangible reality as many have and are in the process of transitioning into the role of a virtual Chief Financial Officer. No longer bound to a specific location or organization, virtual CFOs are providing crucial financial leadership on a remote, freelance basis. But how do you become a virtual CFO? What does the process involve, and what steps should you take to make the change? Keep reading as we reveal why the virtual CFO path is becoming so popular for modern finance leaders, and the steps to help you make this career pivot confidently and effectively. #### Table of Contents: - [What is a virtual CFO?](https://www.financealliance.io/p/05d9d3c9-33d7-436f-b87e-0eed643de066/#what-is-a-virtual-cfo) - [What’s the difference between CFO and virtual CFO?](https://www.financealliance.io/p/05d9d3c9-33d7-436f-b87e-0eed643de066/#what%E2%80%99s-the-difference-between-cfo-and-virtual-cfo) - [What does a virtual CFO do?](https://www.financealliance.io/p/05d9d3c9-33d7-436f-b87e-0eed643de066/#what-does-a-virtual-cfo-do) - [The rise of the virtual CFO](https://www.financealliance.io/p/05d9d3c9-33d7-436f-b87e-0eed643de066/#the-rise-of-the-virtual-cfo) - [How to become a virtual CFO](https://www.financealliance.io/p/05d9d3c9-33d7-436f-b87e-0eed643de066/#how-to-become-a-virtual-cfo) ## What is a Virtual CFO? Imagine having the opportunity to use your financial expertise to guide businesses globally, from the comfort of your home or any remote location (*sunny beach in the Caribbean, anyone?*). As a Virtual CFO or 'vCFO', you can do just that. This role offers a unique blend of flexibility and challenge. It allows you to provide your strategic financial expertise on a part-time, remote basis. You become an instrumental part of your client's success story, helping them navigate financial decisions and strategies, and ensuring their fiscal health, all while embracing the benefits of modern technology and the digital workspace. It's about taking your existing [CFO skills](https://www.financealliance.io/top-10-cfo-skills/) and deploying them in a way that fits the new normal of work, offering both you *and* your clients the best of both worlds. --- [Top 10 must-have Chief Financial Officer skillsThe modern CFO wears multiple hats and must master a variety of skills. But what skills does the CFO of the future need to stay on top? Here are the top 10 skill sets for CFOs of tomorrow.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/arrow-gb0e6f39dd_1920.jpg)](https://www.financealliance.io/top-10-cfo-skills/) --- ## What’s the difference between CFO and virtual CFO? Ah, the question everyone wants to know the answer to! Some of the main differences between traditional CFOs and virtual CFOs include: ### 1\. 🏠 Where they work A traditional CFO typically works in the office, as part of a 9-to-5 (or let's be honest, often longer) workday. Meanwhile, the virtual CFO is all about that flexible life, providing strategic guidance from any location, and often working outside the traditional office hours. So, as a vCFO, you can say goodbye to the dreaded commute! 🚗 ### 2\. 🤝🏽 How they're hired Usually, a CFO is a full-time employee, complete with a long-term contract, benefits, and the whole shebang. On the other hand, businesses hire CFOs virtually on a part-time, flexible basis. They get to tap into top-tier financial expertise *without* the full-time commitment and cost. And you, as a virtual CFO, get the flexibility to work with multiple clients or juggle other commitments. ### 3\. 💻 *Who* they work with CFOs are often found in larger corporations that have the resources to afford their expertise. Virtual CFOs, though, are a boon for small to mid-size businesses that might not be ready for a full-time CFO but still need strategic financial leadership. ### 4\. 🧠 Their focus While both roles handle high-level financial strategy, the virtual CFO often wears more hats. You might handle some tasks usually assigned to controllers or accountants in larger organizations, like overseeing the nitty-gritty of financial operations. It's a broader role, so expect to flex a wider range of financial muscles! So, while a virtual CFO shares the strategic acumen and leadership of a traditional CFO, the roles differ in flexibility, the scope of work, and their potential clients. As a virtual CFO, you'd be at the forefront of a dynamic and evolving way of delivering financial expertise, offering the benefits of a CFO with the added advantage of adaptability to modern work environments. --- [CFO cybersecurity: What’s the CFO’s role in cybersecurity?From crunching numbers to combating cyber threats, the role of the CFO has leaped into uncharted territory, making CFO cybersecurity one of the hottest topics in boardrooms across the globe.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CFO-cybersecurity-2.jpg)](https://www.financealliance.io/cfo-cybersecurity/) --- ## What does a virtual CFO do? If you're considering the leap to becoming a virtual CFO, it's important to understand the key responsibilities that come with this exciting role. Although your tasks might slightly vary based on the specific needs of your clients, here's what you can typically expect: **1\. Crafting financial strategies:** As a Virtual CFO, you'll be guiding the financial strategy of businesses, steering them towards profitability and growth. Your expert advice will influence major business decisions, financial plans, and future strategies. **2\. Running the numbers:** From budgeting to forecasting, you're the one pulling the financial strings. You'll be expected to provide comprehensive financial planning and forecasting, identifying potential financial risks and opportunities. This includes periodic [financial analysis](https://www.financealliance.io/data-cleaning-techniques/) to assess business performance and inform strategic planning. **3\. Juggling cash flow:** Money in, money out. You’ll make businesses don't trip over their financial shoelaces, keeping a close watch on liquidity. **4\. Storytelling through reports:** Budget reports, financial statements, you name it. You'll be spinning tales of triumph and warning, armed with numbers and insights that drive decision-making. **5\. Keeping it legal:** You'll need to ensure businesses stay compliant with financial regulations and implement effective tax planning strategies. **6\. Tech maestro:** As a virtual CFO, you'll work your magic on financial systems and processes, leveraging modern tech to bring efficiency to financial operations. **7\. Conversing with stakeholders:** Remember, you're the financial interpreter, translating complex financial data into language stakeholders can understand. Being a virtual CFO is so much more than being a financial consultant. You're a [strategic partner](https://www.financealliance.io/finance-business-partnering-playbook/), an insightful analyst, a careful planner, and a communicator, all rolled into one. --- [How to become a fractional CFO | Finance AllianceMany CFOs have left full-time positions to regain control of their careers and their time. But how did they do it? That’s what you’ll find out in this blog post as we uncover how to become a fractional CFO.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Fractional-CFO.jpg)](https://www.financealliance.io/how-to-become-a-fractional-cfo/) --- ## The rise of the virtual CFO Why are virtual CFOs becoming the talk of the town? There are a few good reasons and, of course, some pretty cool trends to thank for that: - **Leveling up with tech:** The rise in cutting-edge software gives businesses real-time insights into cash flow, making strategic decision-making a breeze. - **Playing the smart money game:** Who said you need a massive bank balance to afford top-notch financial expertise? With virtual CFOs, even small and midsize businesses can now get the financial acumen they need *without* breaking the bank. - **Flexible financial leadership:** Today, businesses can bring a virtual CFO on board on a part-time, flexible basis. It's financial leadership made-to-order, quite literally! - **Remote control:** Working remotely has many benefits and according to [research](https://www.apollotechnical.com/working-from-home-productivity-statistics/#:~:text=Several%20studies%20over%20the%20past%20few%20months%20show,day%20a%20week%2C%20and%20are%2047%25%20more%20productive.), those who work from home are **47% more productive** than those who work in an office. Not only that but working remotely has never been easier. Thanks tovideo conferencing platforms like Zoom, businesses can stay connected with their CFOs virtually just as effectively as if they were in the same office. And let's be honest, who wouldn't prefer a Zoom call over a long commute? - **Lean & mean operations:** In the wake of the pandemic, businesses are looking to streamline, focusing more on their core functions. And when you can get a seasoned CFO without the added costs of benefits, like paid holidays or medical leaves, it's a no-brainer! - **Moving beyond the basics:** The accounting landscape is shifting, and services like tax preparation and compliance are fast becoming commodities. Businesses want more bang for their buck, which is exactly what a virtual CFO provides - strategic insight, financial analysis, and more. --- [Journey to CFO eBook | Finance AllianceDownload the Journey to CFO eBook and take the first step on your road to the C-Suite.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/FA_Journey_to_CFO_eBook_Meta_.png)](https://www.financealliance.io/journey-to-cfo/) --- ## How to become a virtual CFO If you're intrigued by the virtual CFO path and want to take the leap, here’s how you can make it happen: ### 1\. Identify your virtual CFO services Start by mapping out what virtual CFO services you'll offer. These might include strategic financial planning, budgeting and forecasting, financial report preparation, [cash flow management](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/), risk management, and regulatory compliance. Make sure to leverage your unique skills and experiences to offer services that set you apart. ### 2\. Set your price When it comes to pricing, balance is key. You need to strike a fair price that reflects the value you provide, while also being attractive to your potential clients. Remember, you're not just selling your time, but your expertise, insights, and the value they'll bring to a business. 💡 Research typical virtual CFO rates, but also consider the value you personally bring based on your track record. You may be able to command premium pricing. ### 3\. Build your tech infrastructure In today's digital world, having a strong tech infrastructure is a must. You'll need reliable software for video conferencing, project management, financial reporting, and data analysis. Plus, since you'll be handling sensitive financial information, robust cybersecurity measures are a must. 💡 ****Update your digital presence:** Create a LinkedIn profile highlighting your experience and capabilities. Build a professional website too. This will help you attract clients. ### 4\. Reach out to past and existing clients Don't underestimate the power of your existing network. Offer your services to past clients who already know the value you provide, and consider upselling to existing ones by offering your new virtual CFO services. After all, who better to kickstart your solo career than those who already trust and value your work? ### 5\. Network, network, network Expand your client base by tapping into networking opportunities. This could be anything from attending [industry events](https://events.financealliance.io/?%5Fgl=1%2A1ki6qkc%2A%5Fga%2AMTM1OTc5OTEyOC4xNjkwMTkwNTU4%2A%5Fga%5F2NXFSBEP4N%2AMTY5MDg5MTgyNS4xOC4xLjE2OTA4OTIwNDguMC4wLjA.), joining [online forums or groups](https://www.financealliance.io/community/), to leveraging LinkedIn to connect with potential clients. Remember, every conversation could be a door to a new opportunity. ### 6\. Showcase your expertise Finally, let the world know you're a virtual CFO ready to take on new clients. Consider starting a blog, posting on social media, or giving webinars to [showcase your expertise ](https://www.financealliance.io/call-for-speakers-finance-alliance/)and attract potential clients. Not only will you be marketing your services, but you'll also be building your personal brand as a thought leader in the field. --- So, there you have it - your essential guide on how to become a virtual CFO. Embracing this career path isn't just about adopting new technologies or altering your work style, it's also about reinventing your professional persona and embracing the flexibility and dynamism of the modern business landscape. It's about leveraging the CFO skills you already possess while adapting to the digital era. --- ### FAQs: Transitioning to a CFO virtual role What is a CFO virtual role? A Virtual CFO, or vCFO, offers the same high-level strategic financial expertise as a traditional CFO, but operates remotely, often on a part-time, flexible basis. They work with multiple clients, providing strategic financial leadership tailored to each organization's unique needs and circumstances. What skills are essential for a virtual CFO? In addition to the strategic financial acumen required of a traditional CFO, virtual CFOs need excellent remote communication skills, technological proficiency, and a high degree of adaptability. They should be comfortable with digital tools for collaboration, financial analysis, and cybersecurity. How can a CFO transition to a virtual role? Transitioning to a vCFO role involves identifying the services you'll offer, setting a fair price for your services, building a strong tech infrastructure, reaching out to past and existing clients, networking to attract new clients, and showcasing your expertise through content creation or webinars. --- ### Download our Journey to CFO eBook! Whether you're an aspiring finance professional or a seasoned veteran aiming for the top, this eBook is more than just a guide - it's your golden ticket to the C-suite. You’ll not only learn about the critical skills to master for the role, but you’ll also hear from accomplished CFOs who share their wisdom, experiences, and personal anecdotes to help you achieve the same level of success. ### CFO Stories | Sam Filer, CFO, The Alliance URL: https://www.financealliance.io/cfo-stories-sam-filer/ Last updated: 2025-04-07T16:31:09.000Z This is a very special post in our CFO Stories series as we hear from our very own CFO, Sam Filer. Sam is the CFO of [The Alliance](https://thealliance.io/?utm%5Fsource=linkedin&utm%5Fmedium=pagecta&utm%5Fcampaign=joinslack&utm%5Fcontent=aprilbubble), the world’s most forward-thinking community-led professional development platform for high-growth organizations and individuals. Learn about Sam's interesting and unconventional route into finance, the value of mentorship, and how to ensure a successful career as a CFO.👇 ### Educational background I took an unconventional route into finance. I studied physics at university which actually helped with my development indirectly. I learned analytical techniques, to be curious and to challenge status quo perspectives, and also how to communicate complex ideas in plain English. I later qualified as a charted accountant and then studied for an MBA. My ACA taught me the bread and butter [skillset of a CFO](https://www.financealliance.io/top-10-cfo-skills/) and my MBA was invaluable in providing a strategic and global perspective. ### Continued education and modern CFOs It’s essential in keeping up to date with the latest trends across industries and also in learning new perspectives. I personally enjoy learning about [technology trends](https://www.financealliance.io/podcast/fintech-trends-2023-top-trends-future-predictions-for-fintech/) that may fundamentally change the way we do business and so greatly impact finance e.g. blockchain technology. --- [11 SaaS finance strategies for scaling subscription revenueJoin us as we dive headfirst into the world of SaaS finance, helping you to better understand the industry, how it operates, and strategies to help you succeed in your role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/SaaS-finance-2.jpg)](https://www.financealliance.io/saas-finance-strategies/) --- ### Career path After qualifying as an accountant, I moved over to the investor side working for a hedge fund and private credit fund as an investment analyst and then director. I then relocated to Silicon Valley in the US to study for my MBA and worked in various tech businesses there. After another stint I had was as an investor. I then became a fractional CFO in the UK. My investment experience was pivotal in understanding how to analyze and communicate business performance and also drive fundraising processes. ### Career challenges Relocating back to the UK after seven years in the US was difficult as I had to rebuild my network here. I addressed this by taking on portfolio and investor roles in the UK to meet a range of people and businesses here. ### Networking and mentorship It’s been vital for me, especially when making the switch from being an investor. It has also enabled me to meet best-in-class vendors, investors, and recruits for businesses I work with. --- [10 risks of mergers and acquisitions & how to mitigate themIn this article, we explore the top 10 risks of acquiring a company and how to mitigate them.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/risks-of-M-A.jpg)](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) --- ### Skills and qualities The ability to empathize and communicate with different stakeholders, effective prioritization, leadership, and the ability to inspire and motivate. ### The changing role of a CFO It has become more important to understand the technology and the ways of improving the modern finance tech stack. I have adapted mostly by [networking with other CFOs](https://www.financealliance.io/community/) to learn about their experiences. ### Keeping up with industry trends I have mostly worked in the tech and media sectors so I keep up to date with news in these sectors via leading industry publications. I also monitor trends in the finance world via ICAEW (the UK accountancy body) and keep tabs on relevant news. ### Advice for aspiring CFOs Work in industries you have an interest in and in teams that prioritize culture and are mission-driven. Gain a breadth of experience where possible. ### Key characteristics of a successful CFO Adaptably, the ability to communicate with a range of people and an understanding of industry dynamics beyond the finance bubble. ### Collaborating with key stakeholders By taking the time to meet with each individual stakeholder on a regular basis to understand their specific motivations, objectives, concerns, and priorities. It is important to gain trust via early quick wins and consistent communication. ### Leveraging digital transformation I keep informed by keeping current on products and tools that peer businesses have been using to good effect. I tend to select products that are user-friendly and simple to use but which are powerful as part of well thought-through tech stack. --- ![CFO stories - Sam Filer](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/07/7-2.png) ### About Sam Sam is the CFO of The Alliance, a forward-thinking community-led professional development platform for high-growth organizations and individuals. He is an experienced startup leader having worked within venture-backed businesses in Silicon Valley and in Europe, and also has a background as an investor, working for a variety of debt funds. Sam has an MBA from UC Berkeley and is an ACA. --- ### Take the first step on your road to the C-Suite.👇 Download the '**[Journey to CFO](https://www.financealliance.io/journey-to-cfo/)**' eBook for more tips and advice to help you progress on your journey to the C-Suite. ### What’s in this eBook? - ****The secrets of the CFO role:** Get the inside scoop on the essential traits and skills needed to lead at the highest level. - ****Explore the intricacies of educational backgrounds and professional qualifications**, and learn how to strategically leverage your expertise to ascend the ranks. - ****Navigate the competitive job market** and ace the interview process with insider tips and expert guidance. - ****Developing essential CFO skills:** Master the skills that every successful CFO needs in their arsenal. - ****Developing an action plan:** Forge a strategic path toward your goal with a clear, actionable plan. [Download the eBook](https://www.financealliance.io/journey-to-cfo/) ### CFO Stories | Wayne Spivak, CFO, SBA Consulting URL: https://www.financealliance.io/cfo-stories-wayne-spivak/ Last updated: 2023-08-08T14:39:01.000Z Welcome back to another behind-the-scenes look into the career journey of a successful finance leader as part of our CFO Stories series. Whether you're an aspiring CFO, a seasoned financial professional, or simply someone fascinated by the world of finance, this series promises to provide valuable insights and practical advice to help you in your own journey to the C-Suite. In this [interview](https://www.financealliance.io/cfo-interview-questions-and-answers/), we asked Wayne Spivak, CFO of SBA Consulting to share his career path and tips for anyone who wants to emulate his success. ### Educational background I have a BS in Accounting which provided one basis for my journey to the CFO seat. While in college, I worked in several different businesses and industries where I was in Operations and Accounting. I learned by doing cost accounting, manufacturing, mail\_order (the precursor to e-commerce), inventory control, FP&A skills, etc. ### Continued education and modern CFOs When you are in the CFO suite, continuing education takes on many different forms. Depending on the size of your company and/or the size and breadth of your staff, you may need to stay up to date on accounting issues, tech issues, legal, HR, and the list goes on. With a large staff, the depth of knowledge goes from the micro, or closer to a subject matter expert, to more macro and understanding of the surrounding issues. ### Career path From bookkeeper to controller, and finally to CFO, was my path. Each firm I worked in, as an employee or a consultant, increased my knowledge. My travels were somewhat unique because, for many years, I implemented ERP systems in a wide range of companies in different industries and sectors. --- [CFO vs CPA: Does a CFO need a CPA?There’s no rulebook saying you must be a CPA to excel as a CFO. In this blog post, we clear up the confusion between CFOs and CPAs and explore whether you need a CPA to become a successful CFO (spoiler - you don’t!).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/cfo-vs-cpa-image.jpg)](https://www.financealliance.io/cfo-vs-cpa/) --- ### Career challenges To this day, CEOs believe (usually on the advice of HR and sometimes their public CPA), that a [CFO needs to be a CPA](https://www.financealliance.io/cfo-vs-cpa/). This is just categorically wrong. The role of the CFO is not the Chief Accounting Officer, which would be unless in a large company. Second to that, is a mistaken belief that the CFO needs to have been an auditor. Again, that is not the case. While the CFO may run the public audit for the company, they don’t need to have been an auditor at a Big 6 firm. The role of CFO is more about soft skills, business acumen, and leadership (among others) rather than just “accounting”. ### Networking and mentorship While I never had a mentor, I have had a group of other CEOs, CFOs, Attorneys, and Accountants that have become an unofficial think tank. We ask questions of each other and bounce ideas off each other. It is great to have a sanity check every so often. ### Skills and qualities Having worked in the SME space, and implementing all those ERP systems, I developed IT skills, FP&A, Treasury as well as my accounting skills. I helped multiple companies grow, completed my M&A, been involved in numerous civil actions (and class actions), and defended companies in administrative actions. Each experience became another skillset, each adding to the whole. --- [Top 10 must-have Chief Financial Officer skillsThe modern CFO wears multiple hats and must master a variety of skills. But what skills does the CFO of the future need to stay on top? Here are the top 10 skill sets for CFOs of tomorrow.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/arrow-gb0e6f39dd_1920.jpg)](https://www.financealliance.io/top-10-cfo-skills/) --- ### The changing role of a CFO The CFO has gone from “Accountant” to the [Strategic Partner of the CEO](https://www.financealliance.io/finance-business-partnering-playbook-2/). Many times, especially in the SME space, the CFO is also the COO, so not only does the CFO need to think strategically about finance, cash flow, the budget, etc., but they’ll also need to make sure that the operational aspects of the company are also best practice. Years ago, it was accounting and simple spreadsheets. That is a major change that HR hasn’t grasped yet. Just read most of the job advertisements for CFOs. ### Keeping up with industry trends I read a lot. I also write for CFO.com as a Contributing Editor so I research a wide range of articles and also talk to people. One area that has been an unbelievable advantage is the sheer amount of information people share on LinkedIn. ### Advice for aspiring CFOs Go into Operations for a while. Learn more about the law, two business law classes don’t cut it. Learn to delegate. Learn to lead. Understand the roles of each department and major divisions. Lastly, don’t get stuck in the weeds. --- [CFO Stories | Daniel Echeverri, Warner Bros Discovery“CFOs must stay up-to-date with the latest trends and technologies in finance to ensure their organizations remain competitive and meet the evolving needs of the business.”![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceDaniel Echeverri![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/CFO-Stories-meta-image-1.png)](https://www.financealliance.io/cfo-stories-daniel-echeverri/) --- ### Key characteristics of a successful CFO The ability to see the forest through the trees. Strategic thinking, planning, and understanding the cash flow and cash conversion cycle of the business. A fully developed business acumen, a full understanding of, and best practice of leadership. ### Collaborating with key stakeholders Communication. If you have constant, honest, and frank discussions, then there are no surprises. That means you create a budget and/or forecast that is honest, good, or bad. Nothing is worse than over-promising and underperforming. ### Leveraging digital transformation Up to a year or two ago, if one had to do a cash flow management report it was done in [Excel](https://www.financealliance.io/chatgpt-for-excel/). It was a tedious process, time-consuming, and depending on the circumstances, needed to be done multiple times per month. With the tech stack today, it not only can be done in minutes (after setup) but multiple models can be created using 95% of the same data. Accurate, fast answers can be provided with an increase in overall productivity as the time not spent on a one-dimensional cash flow can be dedicated to other projects of equal or greater urgency (assuming cash flow and runway are sufficient). --- ![CFO stories: Wayne Spivak](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/07/6-2.png) ### About Wayne Wayne Spivak is an experienced CFO, CIO, COO, and CEO, having spent the last 30 years in the small/ medium-sized business market space. He has been the President of SBA\* Consulting since 1995, originally focusing on Manufacturing Accounting Systems (MRP implementations), Accounting Information Systems, Information Technology, and Finance. His company now provides CFO services to the mid-market, where seasoned C-Level and Senior Managerial consultants apply their areas of expertise to creating, facilitating, reporting, and suggesting improvements from the results of a 360° GAP Analysis, as well as business continuity services including cyber security and Incident/ Crisis Management Assistance Teams. Wayne has served as the outsourced CFO of a major high-fashion modeling agency for over 10 years. During that time he enabled and implemented a state-of-the-art, industry-specific accounting system (where he was part of the system analysis team) and was part of the team responsible for maintaining a yearly 30% increase in sales, through one minor and one major recession. He was the New York partner at Hardesty LLC, an outsourced CFO firm, and was a partner at Management Interactive LLC, and the Fund Manager of Prime Resonance Ventures LP, a private equity firm. He is currently a Contributing Editor at CFO.com, an Advisory Board Member at Ithaca College, a Judge for MassChallenge, and the VP, CIO, and Board Member for the Association for Rescue at Sea, Inc., a 501(c)(3) charity. --- ### Take the first step on your road to the C-Suite.👇 Download the '**[Journey to CFO](https://www.financealliance.io/journey-to-cfo/)**' eBook for more tips and advice to help you progress on your journey to the C-Suite. ### What’s in this eBook? - ****The secrets of the CFO role:** Get the inside scoop on the essential traits and skills needed to lead at the highest level. - ****Explore the intricacies of educational backgrounds and professional qualifications**, and learn how to strategically leverage your expertise to ascend the ranks. - ****Navigate the competitive job market** and ace the interview process with insider tips and expert guidance. - ****Developing essential CFO skills:** Master the skills that every successful CFO needs in their arsenal. - ****Developing an action plan:** Forge a strategic path toward your goal with a clear, actionable plan. [Download the eBook](https://www.financealliance.io/journey-to-cfo/) ### How to effectively fundraise and find investors URL: https://www.financealliance.io/how-to-effectively-fundraise-and-find-investors/ Last updated: 2025-04-05T07:33:29.000Z *This article is taken from a presentation Kirill Makharinsky gave at our sister community's event, the Future of SaaS Festival 2022\. Get the full unedited talk on demand,* [*right here.*](https://www.futureofsaas.io/future-of-saas-festival-3/) In this article, I’m going to share some stories from my fundraising career that I've never shared anywhere else. Each story comes with a lesson I learned along the way. Hopefully, these lessons will help you as you embark on your journey to raise capital. A little bit of background before we get started: I've co-founded companies that have over $200 million in net revenue. I’ve raised over $100 million from investors like Founders Fund, General Catalyst, and Accel. I also spent about eight years angel investing, during which time I was an early investor in companies like Angel Investor, List, Calm, and many more. **Main talking points include:** - [Fundraising: it’s not magic](https://www.financealliance.io/p/819d842d-5d7c-4b21-8227-764e566f0d3b/#fundraising-its-not-magic) - [The power of SaaS metrics](https://www.financealliance.io/p/819d842d-5d7c-4b21-8227-764e566f0d3b/#the-power-of-saas-metrics) - [When doubt sets in](https://www.financealliance.io/p/819d842d-5d7c-4b21-8227-764e566f0d3b/#when-doubt-sets-in) - [Raising $13m pre-product](https://www.financealliance.io/p/819d842d-5d7c-4b21-8227-764e566f0d3b/#raising-13m-pre-product) - [When we got capital with negative dilution](https://www.financealliance.io/p/819d842d-5d7c-4b21-8227-764e566f0d3b/#when-we-got-capital-with-negative-dilution) - [When you’re rejected… many times](https://www.financealliance.io/p/819d842d-5d7c-4b21-8227-764e566f0d3b/#when-we-should-have-died%E2%80%A6-twice) ## **Fundraising: it's not magic** I want to start by dispelling the myth that fundraising is some kind of magic black box. It's a simple process. There are six key steps to fundraising; all you have to do is keep practicing each one. Let's look at the six steps. **Step one:** **Figure out your story**. What does the product or service you’re building have to offer? Why would a potential investor be interested? You have to figure this out before you can go anywhere. **Step two: Find the right investors** – more on this later. **Step three: Pitch again and again.** Unless you’re incredibly lucky, pitching is probably going to be a long and arduous process. It may take months or even years. **Step four: Agree on reasonable terms.** Once you’ve got someone interested in investing in you or your company, it’s time to set a deal that works for both of you. **Step five: Get the money in the bank.** This step doesn’t need much explanation. **Step six: Get back to work!** That’s it. There’s no magic, alchemy, or witchcraft. The folks who are good at fundraising and finding investors are just nailing each of these steps and getting better with practice. ## **The power of SaaS metrics** We need to talk about metrics. Improving your business is the most effective way to get investors excited. You can demonstrate improvement with metrics. The great thing about SaaS is there are loads of metrics you can leverage to measure and present the health of your business. Even early on, when you have a limited number of customers, it's pretty much algorithmic. Keep in mind that the top investors will have a crystal-clear view of how a business like yours should be performing metrics-wise at every stage. Now, let’s delve deeper into my experience. --- [11 SaaS finance strategies for scaling subscription revenueJoin us as we dive headfirst into the world of SaaS finance, helping you to better understand the industry, how it operates, and strategies to help you succeed in your role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/SaaS-finance-2.jpg)](https://www.financealliance.io/saas-finance-strategies/) --- ## **When the unicorn founders wrote the first checks** One thing that links all of my companies’ investment journeys is that they all began with a check from an influential investor. At my first company, Quid, the first check was from Max Levchin, the founder of PayPal, with who I had worked at Slide. The next company’s first check came from Naval Ravikant, the founder of AngelList. At Enki, the first money came from John Earner, who's the founder of Space Ape Games. Despite appearances, your first investor doesn't need to be a unicorn founder, but if you find someone with a high centrality score, it’s going to make securing further investments much easier. Now, your immediate impression might be “you've got an influential network, you're lucky,” but the reality is that anyone can build their network and reputation these days. Unlike Hollywood producers, technology industry influencers are very open and meritocratic about who they talk to, who they employ, and who they invest in. You need to impress these folks – the simplest way is to work for them. Working for Max Levchin at Slide was a big reason why he was willing to back me. So whether you're joining a successful company with a lot of influential folks in the exec team, or you manage to build a relationship through your blog with folks who have built interesting things, you have to make an impression. [!['Investment'](https://www.futureofsaas.io/content/images/2022/07/investment.jpg)](https://www.futureofsaas.io/how-to-effectively-fundraise-and-find-investors) ### **Lesson one: Investor brand matters** Investor brand matters and this is true throughout the entire lifecycle of a company. If you're raising a Series A or a first institutional round, it's important who your seed investors are. If that first investor has a strong brand, it’ll help you get on the radar of the top VC funds. Unless your metrics are out completely out of this world, it's near-impossible to raise funding from a top-tier institutional fund if you haven’t been highly recommended by an earlier stage fund that they know and respect. That's the first lesson to keep in mind: the brand of your early investors and the metrics that you focus on can make everything else much easier. ## **It’s a match!** My second story is about how I was introduced to Joel Cutler at General Catalyst, the first institutional investor in my second company. This was a hotel booking company, so naturally, I was looking for investors with an interest in the travel industry. I was looking for people I had some mutual connections with, so I could make a warm introduction. That’s how I came across Joel. It turns out I had exactly one connection to Joel, someone who I’d worked with at Slide, so things looked promising. Marc Andreessen says securing a warm introduction is the first test. Why? Because an investor might think that if you can’t land that introduction, there’s no way you’ll be able to do even harder things like hiring or finding customers. However, while a warm introduction is a great way to find an investor, it’s not the only way. You can identify potential investors in databases and other online resources these days. From there, it’s just a matter of reaching out in an email. [![hands counting money](https://www.futureofsaas.io/content/images/2022/07/money.jpg)](https://www.futureofsaas.io/how-to-effectively-fundraise-and-find-investors) ### **Lesson two: Target the right investors** The part I missed out from the story with Joel Cutler, and by far the biggest reason we were able to raise an institutional round with him, is that he was searching for a company like ours at the time. We were building a hotel booking product for the Russian-speaking market, and he was searching for a company that was doing exactly that. To be totally transparent, I had no idea that that was what he was looking for, so we actually did get quite lucky. However, the fact that we were looking for travel investors who were interested in emerging markets was enough at that point. Now, there are a thousand reasons why a pitch can fall flat, and we’ll get into that later, but targeting investors who are looking for the opportunity that you're offering is still incredibly important. If you don't manage that, your pitch is dead on arrival. --- [The CFOs guide to effective SaaS cost managementIn this blog post, we’ll dive deep into the world of software management, revealing its game-changing importance and serving up some strategies for optimizing spend. We’ll also share practical tips to reduce SaaS spend and recommend the best tools to make the whole process run a lot smoother.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/SaaS-cost-management.jpg)](https://www.financealliance.io/saas-cost-management/) --- ## **When doubt sets in** I already mentioned how Naval Ravikant signed the first check for my travel company. The story here is that we sent him a very basic slide deck and pitch, and he committed $50,000 on a SAFE note. We were super excited. I like Naval and was thrilled to have him as our first investor. Because he’s so influential, we soon started getting verbal agreements from other investors too. Then he gave me a call. He was unwell, and not in the right frame of mind to be investing in new things. Plus, he had never met my co-founder before and he wasn't sure of him. He was considering passing on the investment. This was all out of the blue, and it would have been pretty bad – the other investors would probably pull out too. I had to sell Naval on the amazing opportunity we had in front of us. It took half an hour of persuasion, but eventually, he changed his mind. [![](https://www.futureofsaas.io/content/images/2022/07/deal-unsplash--1-.jpg)](https://www.futureofsaas.io/how-to-effectively-fundraise-and-find-investors) ### **Lesson three: You’ve got to sell effectively** This brings us to our third lesson: fundraising is a sales process. You’ve got to learn how to sell. You’ll have a lot of experiences like this, especially in the early stages of fundraising, so you've got to have your sales hat on at all times. ## **The spontaneous flight to Hawaii** Next, we have the tale of the spontaneous flight to Hawaii. This happened back when I was working at Slide and I was considering leaving to focus on my new venture, Quid, full time. At the time, my co-founder and I were basically building the product on weekends. A lot of things were up in the air. I had a great relationship with Max, who was my boss, but I hadn't told him yet that I was considering moving on. Plus, we hadn't had any commitments from investors yet. Through a mutual friend, my co-founder and I started to build a relationship with a wealthy investor who was traveling around the world at the time. He’s a busy guy – he’s always traveling. One day, he messaged us saying, “Hey, I'm going on a trip to Hawaii with my family. If you guys want to chat about business, you should come over and do it here,” which is absolutely ridiculous, right? I mean, we were in San Francisco. He said he was going to be there for another 24 hours, and so we said, “Screw it, let's do it. Let's fly to Hawaii.” We boarded the first plane to Hawaii and ended up chatting for four hours on the beach with this guy. By the end of it, we got a verbal commitment from him. It had such an impact on the future of the company, I think of it as a ‘Sliding Doors’ moment. --- [Top 10 SaaS CFO duties for scaling an epic SaaS companywhat are the main SaaS CFO duties on your plate? And what can you do to lead the finance team and the company to roaring success? In this article, we’re diving into the top 10 SaaS CFO duties for scaling an organization to new heights![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/SaaS-CFO-Duties-2.jpg)](https://www.financealliance.io/top-10-saas-cfo-duties/) --- ### **Lesson four: Hustling is par for the course** The lesson here is you gotta hustle. It's going to be difficult. You're going to be pitching over and over, but when the right opportunity presents itself, you’ve just got to go for it. ## **Raising $13m pre-product** I’ve already told you how we started working with Joel from General Catalyst. What I haven’t told you yet is that we ended up raising $13 million for our company, pre-product. This was unusual at the time, even in Silicon Valley. It was particularly unusual given that we were based in Eastern Europe. No founders had ever raised more than $5 million, let alone over $10 million for a pre-product company in that area. We could never have done that without a compelling story. ### **Lesson five: It’s all about the narrative** What I want to stress here is that it's all about the narrative you create. A compelling story is crucial. It has to be all about you, and it has to project something so irresistible to the investor you're talking to that they take out time from their schedule and make your company one of the small handful they invest in that year. [![Plant growing from a pot of money](https://www.futureofsaas.io/content/images/2022/07/growth.jpg)](https://www.futureofsaas.io/how-to-effectively-fundraise-and-find-investors) Focusing on the story and making it as precise and compelling and memorable as possible is something that few people practice systematically. Often you have to iterate on it 20 or 30 times with friends and with colleagues until you get it right. Of course, appealing to what your audience cares about is vital. A useful mental model is to approach your story like an onion. Each layer of the onion represents something you have de-risked in the past, something you’re currently working on de-risking, or something that you will de-risk in the future, once you have secured your investment. A very compelling story for an investor typically sounds like, “In the past, with the previous money I've raised, I've managed to de-risk the following things. This cost me X amount of money. And now with the money that I'm about to raise, I'm going to de-risk these things. This is going to cost me X amount of money and here's my plan to do that.” This is a handy framework to keep in your back pocket. ### **Lesson six: It’s not in the bank until it’s in the bank** The lesson here is a simple one: it's not in the bank until it's in the bank. ## **When we got capital with negative dilution** When a deal with the Chinese travel company fell through, we went back to our investors at General Catalyst. This was four years after they first invested and right after chief villain Vladimir Putin came back to power. The future of Russia was looking bleak, so General Catalyst said they wouldn’t support us with the $5 million or so we needed to survive. Now the interesting story here is that instead of investing the $5 million, they did something even better. They decided to give us a couple of million dollars so we could raise the rest of the money we needed. They also canceled themselves from the cap table because they were no longer allowed to invest in Russian companies. In the end, we got a couple of million dollars with negative dilution, which helped us raise the next bridge round. --- [How to build a basic SaaS business financial modelWhether you’re launching a SaaS start-up, or your existing financial model needs some much-needed TLC, building the best financial model for your SaaS company doesn’t have to be difficult. In this article, we’ll cover how to build a SaaS financial model![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/SaaS-financial-model.jpg)](https://www.financealliance.io/build-a-saas-financial-model/) --- ### **Lesson seven: Board member = life partner** The main lesson here is that your board members and your institutional venture capitalists can be amazing partners. The best investors hope you will become a big independent company, and that's a 15-to-20-year journey – longer than the average American marriage. If you put as much thought into choosing an investment partner as you do a life partner, you have the roots of an amazingly fruitful relationship. ## **When we should have died… twice** Off the back of the Chinese company not investing in us, we had to raise $3 million in a weekend to survive, all from non-VCs. It was Christmas Eve, which was a complete nightmare, but somehow we did it. COVID nearly took us out too. As you can imagine for a hotel booking company, our revenue literally went down about 95%. How we survived that, I'm still not sure. ### **Lesson eight: When the going gets tough, the tough get going** This is about more than just hustling – you’ve got to do whatever it takes to survive. This is what separates those that win from those that don't. As the old saying goes, when the going gets tough, the tough get going. ## **When you’re rejected… many times** Everyone talks about how they've been rejected as an entrepreneur. By my latest estimate, I’ve been rejected about 350 times by various investors across all my companies. [!['resilience'](https://www.futureofsaas.io/content/images/2022/07/resilence.jpg)](https://www.futureofsaas.io/how-to-effectively-fundraise-and-find-investors) ### Lesson nine: Don’t take it personally Reflect and move on. What's important here is not to take it personally. Do a retrospective as to what you could have improved and move on. The best entrepreneurs have been through a huge amount of rejection, but they just keep practicing each of those steps that I mentioned at the top of the article. Do you believe in your vision? Do you believe in what you're doing? That's the only real thing that matters. What folks early on in their entrepreneurial careers don't realize is that there are so many reasons why you might get rejected. Institutional investors say no mainly because they can only invest in five to 10 deals a year. Within that five-to-10-deal punch card, there are so many factors, including internal politics, that dictate why they do or don’t invest. Just keep getting better at each of these steps, and keep in mind that this is only one part of the entrepreneurial process. The other parts are much more interesting and often more challenging. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### CFO Stories | Mike Kovar, CFO, Acra Lending URL: https://www.financealliance.io/cfo-stories-mike-kovar/ Last updated: 2023-07-11T09:00:17.000Z > "I believe my job as CFO, at its core, is to take data and create usable information out of it – to provide transparency and analysis to enact change." In this inspirational CFO story, you'll hear how Mike Kovar, CFO of Acra Lending, has gotten to where he is today. As a driven and tech-savvy finance leader, Mike's story is packed with tips and insights to help you on your journey to becoming a successful CFO. Keep reading as we unravel Mike's CFO story - a tale of transformation, mentorship, and leveling up in the world of finance. ### Educational background I have a mathematics and business undergraduate degree, an MBA in Finance and Accounting, and am a CPA and CFA. My education has dramatically impacted my ability to address technical and managerial issues. As a bit of a “Quant”, I can talk prepayment speeds and valuation for our servicing portfolio and understand management and tax issues. ### Continued education and modern CFOs If the business didn’t change, I believe you could make an argument that you shouldn’t either. But markets, industries, and businesses do change, and we need to change as well. This is not just for continued education, but constantly revisiting what we do and why we do it – in the never-ending search for greater efficiency. --- [11 SaaS finance strategies for scaling subscription revenueJoin us as we dive headfirst into the world of SaaS finance, helping you to better understand the industry, how it operates, and strategies to help you succeed in your role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/SaaS-finance-2.jpg)](https://www.financealliance.io/saas-finance-strategies/) --- ### Career path As both a CPA and CFA, I was instrumental at public financial services firms in implementing FAS 133 Derivatives and Hedging. Technical accounting was a springboard for me, and I never looked back. I moved into FIN 46 and Goodwill impairment analysis and have always needed my technical accounting skills. The FASB works hard to keep CPAs on their toes. ### Career challenges Many times, I did not have resources to assist and, at times, was a “one-man show”. While I always had credibility because of my high-profile duties, not everybody always shared my priorities. These challenges tested my resolve to complete my duties. I was either able to go around, under, over, and, at times, right through obstacles to stay results-oriented. ### Networking and mentorship [Networking](https://www.financealliance.io/community/) has been very important to my success, and I would recommend everybody work hard to maintain an active network and invest in it. One flaw in my background is the lack of a mentor. This resulted in a lot of extra work and mistakes that otherwise may not have occurred with a mentor. ### Skills and qualities Communication is key as is a drive for results. I have always had the ability to work tirelessly and stay focused on a goal – and it has paid off. My attempts to re-engineer my duties, team, or myself have resulted in the ability to either adapt or be proactive in responses to changes. --- [5 supply chain risk mitigation strategies to dodge disasterHow can you mitigate supply chain risks as effectively as possible? Find out in this article, where we explore five key supply chain risk mitigation strategies to help you steer your company toward financial stability and resilience.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/supply-chain-risk-mitigation-strategies-2.png)](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) --- ### The changing role of a CFO The CFO role has dramatically changed over the past 25 years – I believe because of Sarbanes-Oxley. This propelled the CFO to be responsible for documentation and internal controls related to operations, finance, and IT. The CFO now tests controls that can also impact a CEO – and that has had a big impact on the CFO’s duties. Also, the world is more technical and things seem to move faster than ever. ### Keeping up with industry trends I attend conferences, review trade publications, and have daily information from the LA Times and other online sites. We do have a subscription to Gartner from our IT group, and this provides great information on [trends and industry updates](https://www.financealliance.io/5-esg-investing-trends/). Properly implemented, this minimizes surprises. ### Advice for aspiring CFOs > "Work hard, invest in yourself, and leap when you get an opportunity." Accountants are generally risk-averse and an aggressive mindset for your projects and career will separate you from the rest. If you are asking the question whether you have the skills to sit in the seat then you probably don’t. ### Key characteristics of a successful CFO The CFO of today needs to have a diverse background of experiences – they need tax experience, treasury, internal controls, and technical accounting skills. The staffing shortages require changes in staff management to retain employees. Talent is so hard to come by that most teams are operating shorthanded – creating the need to be more efficient. Prioritization seems to be important as the workload and areas of responsibility have increased tremendously. --- [Operational finance: A CFO’s guide to leadership stylesOperational finance is an essential aspect of a successful CFO’s skill set. But mastering the operational side alone isn’t enough. You also need to wear your strategic leadership hat too and learn to balance both for maximum impact. But how?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CFO-operational-finance.jpg)](https://www.financealliance.io/operational-finance/) --- ### Collaborating with key stakeholders My company is PE-owned and this can create challenges at times. My focus with all stakeholders is our common interest – everybody is focused on creating a profitable and growing company. We may go about this interest in different ways, but this allows for common ground to initiate conversations and think collaboratively. CEOs have a certain skill set and it is typically not the skillset a CFO has – a smart CEO will partner with his CFO to form a formidable 1-2 punch. ### Leveraging digital transformation We are very focused on system implementation and data. I have been fortunate to have worked with some excellent CTOs and their vision and impact have been tremendous on my teams. The companies with less depth and vision in IT had a harder time providing recommendations and solutions to make the teams more efficient. --- ![CFO Stories: Mike Kovar](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/07/5-2.png) ### About Mike I am a driven and tech-savvy finance leader transforming operations to drive shareholder value. My focus is on middle-market, private, and private equity-backed companies. I use metrics, results, and analysis to drive strategic decisions to impact operations. I partner with operations and executives to drive efficiency and ensure focus is on strategic initiatives to obtain results as set by BOD and Management. I believe my job as CFO, at its core, is to take data and create usable information out of it – to provide transparency and analysis to enact change. The CFO is in a unique position to see all the costs associated with business decisions and the benefits derived from them. --- ### Take the first step on your road to the C-Suite.👇 Download the '**[Journey to CFO](https://www.financealliance.io/journey-to-cfo/)**' eBook for more tips and advice to help you progress on your journey to the C-Suite. ### What’s in this eBook? - ****The secrets of the CFO role:** Get the inside scoop on the essential traits and skills needed to lead at the highest level. - ****Explore the intricacies of educational backgrounds and professional qualifications**, and learn how to strategically leverage your expertise to ascend the ranks. - ****Navigate the competitive job market** and ace the interview process with insider tips and expert guidance. - ****Developing essential CFO skills:** Master the skills that every successful CFO needs in their arsenal. - ****Developing an action plan:** Forge a strategic path toward your goal with a clear, actionable plan. [Download the eBook](https://www.financealliance.io/journey-to-cfo/) ### How to create a CFO mission and vision statement URL: https://www.financealliance.io/cfo-mission/ Last updated: 2025-08-11T14:25:46.000Z Have you ever wondered what a CFO's mission is and why it's so important? To be a successful CFO, you must establish (and communicate) your mission, vision, and values for the company. These guiding principles are the backbone of great financial leadership. By keeping these concepts front of mind, you’ll be in a much stronger position to lead the company to success. The CFO mission and vision statement aren't just fancy phrases – they're essential components of what makes a good CFO *great*. So, what should your mission look like? And how can you communicate it to your team and other stakeholders? In this blog post, we shed some light on how an established vision can drive success for your company. We’ll also share some CFO mission and vision statement examples and teach you how to create one of your own. --- --- ## **The CFO mission** ### What is the CFO's mission and why does it matter? The CFO mission is all about the main goals and responsibilities of a Chief Financial Officer within an organization. It matters because it helps guide financial strategy, decision-making, and overall success. ### Key components of a CFO mission statement Your CFO mission statement should include: - **Clear financial objectives:** State the specific financial goals you’ll work towards, such as growth or profits. - **Stakeholder focus:** Show how you’ll serve various stakeholders (internally and externally), like shareholders, employees, and customers. - **Strategic alignment:** Ensure your mission connects with the company's overall strategy and objectives. --- [5 supply chain risk mitigation strategies to dodge disasterHow can you mitigate supply chain risks as effectively as possible? Find out in this article, where we explore five key supply chain risk mitigation strategies to help you steer your company toward financial stability and resilience.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/supply-chain-risk-mitigation-strategies-2.png)](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) --- ## Define your mission statement’s purpose A well-crafted CFO mission statement: **Inspires and motivates the finance team:** It gives them a clear direction and purpose, so they're eager to contribute to the company's success. **Guides decision-making:** It helps you and your team make better choices, aligned with the company's goals. **Builds trust with stakeholders:** When the CFO's mission is clear, it's easier for stakeholders to understand and support their financial decisions. ## Examples of effective CFO mission statements Not sure how to create your CFO mission statement? Here are some simple examples: **"To lead financial strategy and execution, ensuring sustainable growth and long-term value for our stakeholders. My mission is to also promote transparency and collaboration across the company."* **"My mission is to drive financial excellence by providing accurate and timely financial information, optimizing resources, and safeguarding company assets for the benefit of all stakeholders."* **"As the CFO, I'm committed to empowering the company through strategic* [**financial leadership*](https://www.financealliance.io/cfo-leadership-pillars/)**, fostering innovation, and ensuring the highest ethical standards in all financial activities."* ## **CFO vision** ### What is the CFO's vision and how does it shape financial strategy? The CFO vision is your long-term aspiration for the finance function within an organization. It outlines where you want to take the finance team and how you plan to contribute to the company's success. Your vision plays a key role in shaping financial strategy, as it sets the direction and focus for the team. Research by [KMPG](https://assets.kpmg.com/content/dam/kpmg/pdf/2016/07/being-the-best.pdf) revealed 44% of CFOs say their finance function doesn’t have a clear vision, so it's important to make sure you've got yours covered. > “*CFOs who fail to articulate their role and demonstrate their value to the business can find it more difficult to win the resources required to create a leading finance function*.” – *Being the Best: Insights from leading finance functions*, KMPG --- [CFO cybersecurity: What’s the CFO’s role in cybersecurity?From crunching numbers to combating cyber threats, the role of the CFO has leaped into uncharted territory, making CFO cybersecurity one of the hottest topics in boardrooms across the globe.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CFO-cybersecurity-2.jpg)](https://www.financealliance.io/cfo-cybersecurity/) --- ### Critical elements of a CFO vision statement An impactful CFO vision statement should include: 1. **Future orientation:** Describe where the finance function should be in the long term and how it’ll evolve. 2. **Strategic alignment:** Connect the vision to the company's broader strategy and long-term goals. 3. **Aspirational tone:** Make it inspiring and ambitious, encouraging your team to aim high and work towards excellence. Remember, a compelling CFO vision statement: ### Motivates the team It helps the finance team understand the importance of their role and encourages them to work towards the long-term vision. ### Provides focus It serves as a guide, helping your team prioritize tasks and projects that align with company goals. ### Fosters a sense of purpose When the team knows where they're heading, they feel more engaged and committed to achieving the vision. ## Examples of powerful CFO vision statements Here are some inspiring CFO vision statements to consider: **"My vision is to become the trusted financial partner for our organization, driving growth and innovation while maintaining the highest standards of financial integrity and transparency."* **"As the CFO, I envision a future where our finance function is a catalyst for change, providing strategic insights and creating value across the company."* **"I will empower the company through data-driven financial leadership, fostering a culture of continuous improvement, adaptability, and collaboration."* ## CFO values: The guiding principles Core values are the fundamental beliefs that guide a CFO's decision-making process. These values shape the way a CFO manages financial resources, interacts with stakeholders, and contributes to the organization's overall success. CFOs must also focus on building purpose-driven values that are authentic. According to [Deloitte](https://www2.deloitte.com/uk/en/pages/finance/articles/cfo-vision.html): > "*Providing clarity and commitment to investors and employees on *purpose* makes goal setting easier and decisions clearer – it gets people facing the same direction*." ### Some examples of CFO values might include: - **Integrity:** Upholding the highest ethical standards in all financial activities and decisions. - **Accountability:** Taking ownership of financial responsibilities and delivering on commitments. - **Collaboration:** Fostering teamwork and open communication across the organization. - **Innovation:** Continuously seeking opportunities to improve financial processes and drive growth. - **Transparency:** Ensuring financial information is clear, accurate, and readily available to stakeholders. --- [10 risks of mergers and acquisitions & how to mitigate themIn this article, we explore the top 10 risks of acquiring a company and how to mitigate them.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/risks-of-M-A.jpg)](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) --- ## Aligning the CFO mission and vision with company values It's essential to align your CFO mission and vision with the company’s values because it... ### 1\. Promotes a cohesive approach When everyone in the organization shares the same values, it's easier to work towards common goals. ### 2\. Builds trust Stakeholders are more likely to trust and support your decisions if they align with the company's values. ### 3\. Reinforces the company culture A strong alignment between your mission, vision, and the company's values contributes to a healthy and positive work environment. CFO values play a crucial role in ensuring ethical, transparent, and responsible [financial management](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) by: - **Guiding decision-making:** Values help the CFO make choices that are in line with the company's principles and expectations. - **Setting expectations for behavior:** When the CFO models the values, it sets the standard for the entire finance team to follow. - **Enhancing reputation:** Upholding strong values can enhance the company's reputation among stakeholders and the broader business community. ## Identifying and developing your core values Here are some suggestions for identifying and developing a CFO's core values: ### Reflect on your beliefs Consider the principles and ethics that you believe are most important for a CFO's role. ### Analyze the company's values Review your company's values and identify those that are most relevant to the finance function. ### Gather input from others Ask colleagues, peers, and mentors for their insights on the values that should guide your decisions. ### Create a values statement Combine your findings to create a clear and concise statement that outlines your core values. ### *Live* the values Consistently demonstrate the values in your actions and decisions, setting an example for your team and the organization. --- [Operational finance: A CFO’s guide to leadership stylesOperational finance is an essential aspect of a successful CFO’s skill set. But mastering the operational side alone isn’t enough. You also need to wear your strategic leadership hat too and learn to balance both for maximum impact. But how?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CFO-operational-finance.jpg)](https://www.financealliance.io/operational-finance/) --- ## **Bonus tips** Here are some additional tips to help you create a more effective statement: ### For your CFO vision statement: Focus on the finance function's future image. Think about how the CFO and the finance team would like to be seen by CXOs and stakeholders in the future. Use descriptive keywords such as: - Visionary - Proactive - Supportive - Risk enabler - Solution provider - Collaborative - Team player ### For your CFO mission statement: Emphasize value addition: Clearly state how the CFO and the finance team will contribute to the company's success and growth. Use action-oriented keywords like: - Value addition - Deep insight - Predictive - Consistency - Timely - Driving profitability - Wealth creation ### **The power of a well-defined CFO mission, vision, and values** As we've explored in this blog post, defining each of these concepts is essential for driving financial growth. These guiding principles not only shape your financial strategy but also motivate your team to work towards a common goal. --- ### FAQs What is the difference between a CFO mission and a CFO vision? The CFO mission outlines the primary goals and responsibilities of a Chief Financial Officer within an organization, while the CFO vision describes the long-term aspirations for the finance function and how it will contribute to the company's success. Why are CFO mission and vision statements important? CFO mission and vision statements are essential as they provide a clear direction for the finance team, guide decision-making, and help build trust with stakeholders. They also inspire and motivate the team to work towards the organization's financial goals. How can I create an effective CFO mission statement? To create an effective CFO mission statement, focus on clear financial objectives, stakeholder focus, and strategic alignment with the company's overall goals. Make sure the statement is concise and communicates the main responsibilities of the CFO. How do CFO values contribute to financial management? CFO values guide decision-making, set expectations for behavior, and enhance the company's reputation. By upholding strong values, a CFO fosters a culture of ethical, transparent, and responsible financial management. How can I identify and develop my CFO core values? Reflect on your beliefs, analyze your organization's values, gather input from others, create a values statement, and consistently demonstrate the values in your actions and decisions. This process will help you identify and develop the core values that guide your role as a CFO. --- ### Join our Slack community It's an empowering platform for finance professionals like you, offering an exclusive space to connect, learn, and grow. We bring together diverse minds from the finance world, facilitating knowledge sharing and fostering innovation. From topical discussions and expert insights to collaborative projects, you'll find value in every interaction. Join us to stay updated with the latest in finance, network with peers, and contribute to shaping the future of our industry. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### CFO Stories | Daniel Echeverri, Warner Bros Discovery URL: https://www.financealliance.io/cfo-stories-daniel-echeverri/ Last updated: 2023-08-08T14:44:59.000Z Welcome to the first blog post in our CFO Stories series, where we interview successful CFOs and finance leaders about their unique career paths. Whether you're an aspiring CFO, a seasoned financial professional, or simply someone fascinated by the world of finance, this series promises to provide valuable insights and practical advice to help you in your own journey. First to take center stage is none other than Daniel Echeverri, Executive Director of FP&A at Warner Bros Discovery and the previous CFO of Renault Mexico. Daniel's story is one of determination, resilience, and innovative thinking. It's about harnessing the opportunities that come your way, creating value in unexpected places, and always pushing the boundaries to stay ahead of the game. Keep reading as we unravel Daniel Echeverri's CFO story - a tale of leading, learning, and leveling up in the world of finance. ### Educational background My educational background has significantly impacted my success as a CFO. As a Mechatronic Engineer, I have a deep understanding of processes and systems, and how to strive for optimal efficiency. Working in a manufacturing plant early on in my career helped me understand how value is created in a company. And, my educational pursuits in finance, business excellence, and [mergers and acquisitions](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) have provided me with the necessary knowledge and skills to lead financial organizations effectively. ### Continued education and modern CFOs Continued education is vital for modern CFOs, especially in areas like developing high-performance teams and learning about new technologies for finance. CFOs must stay up-to-date with the latest trends and technologies in finance to ensure their organizations remain competitive and meet the evolving needs of the business. --- [CFO cybersecurity: What’s the CFO’s role in cybersecurity?From crunching numbers to combating cyber threats, the role of the CFO has leaped into uncharted territory, making CFO cybersecurity one of the hottest topics in boardrooms across the globe.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CFO-cybersecurity-2.jpg)](https://www.financealliance.io/cfo-cybersecurity/) --- ### Career path My career path leading up to my current CFO position has been varied, starting in logistics and transport costs before working with distributors and dealers. I served as the Chief of Staff for LATAM before becoming a CFO. The pivotal roles and experiences that shaped my journey include working with cross-functional teams, developing strategies that align with the overall business objectives, and leading finance transformations. ### Career challenges As I progressed in my career, the main challenge I faced was learning to depend on my team and peers rather than solely on myself. It was important to learn how to develop together while growing as an organization. Through effective mentorship and by continuously learning and helping others, I overcame these challenges and developed the necessary skills to lead successful finance teams. ### Networking and mentorship Mentorship has been a critical aspect of my journey to becoming a CFO. Choosing the right mentors and understanding which feedback is beneficial is crucial. [Networking](https://www.financealliance.io/community/) should be the result of overperforming in your assignments and helping others to achieve common goals. --- [Top 10 must-have Chief Financial Officer skillsThe modern CFO wears multiple hats and must master a variety of skills. But what skills does the CFO of the future need to stay on top? Here are the top 10 skill sets for CFOs of tomorrow.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/arrow-gb0e6f39dd_1920.jpg)](https://www.financealliance.io/top-10-cfo-skills/) --- ### Skills and qualities The specific [skills or qualities](https://www.financealliance.io/top-10-cfo-skills/) that were crucial to my success in obtaining the CFO role include: - Having common sense - Being a team player - Striving to overperform - Being curious - Continuously learning - Helping others ### The changing role of a CFO The role of a CFO has evolved significantly since I first began my career in finance. It's no longer perceived as just a bookkeeper but is now a key player in driving digital transformation and acting as a business partner for every area of the company. As a CFO, I have adapted to these changes by continuously staying curious and learning how to work effectively with other departments while implementing new technologies that drive the company’s growth. ### Keeping up with industry trends To stay current with industry trends, regulatory changes, and emerging technologies in the finance world, I regularly join courses offered by universities and companies. I also network with my peers and attend [finance conferences](https://events.financealliance.io/?%5Fgl=1%2A1agsm1j%2A%5Fga%2AODIzNzQwOTAxLjE2ODA5NDY3Mjk.%2A%5Fga%5F2NXFSBEP4N%2AMTY4ODM3ODE0MC4zMjMuMS4xNjg4MzgxNDM4LjAuMC4w) to learn from thought leaders and industry experts. ### Advice for aspiring CFOs My advice to aspiring CFOs who are looking to follow in my footsteps is to understand themselves as leaders and create a strategy that aligns with their personal vision and values. It is essential to continuously learn, stay curious, and build strong relationships with their teams and key stakeholders. --- [Managing Complex Change Matrix for CFOs (Lippit-Knoster Model)Change is often necessary to help companies stay adaptable, competitive, and prepared for new challenges. One tool that has proven helpful in this area is the Lippitt-Knoster Model for Managing Complex Change Matrix, which provides a clear framework for handling change.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/managing-complex-change-model-2.jpg)](https://www.financealliance.io/managing-complex-change-matrix/) --- ### Key characteristics of a successful CFO The [key traits of a successful CFO](https://www.financealliance.io/10-cfo-personality-traits/) in today’s business environment include being a business partner to the CEO and every area of the company, overperforming through the financial teams by implementing new technologies and driving digital transformation that contributes to the organization’s growth and success. ### Collaborating with key stakeholders To foster a healthy and productive relationship with the CEO, board of directors, and other key stakeholders, CFOs must create a full confidence environment with their partners. This involves always speaking the truth and understanding and supporting the CEO’s and board’s strategy, which is a good beginning for a long and healthy relationship. ### Leveraging digital transformation Leveraging [digital transformation ](https://www.financealliance.io/what-is-finance-transformation/)and innovative technologies is essential to improving a company’s financial performance and efficiency. CFOs must encourage and allow their teams to use different technologies in their daily activities and provide the necessary training to use them effectively. --- ![CFO Stories - Daniel Echeverri](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/07/CFO-Stories-meta-image-1.png) ### About Daniel Digital and finance transformation leader, Daniel Echeverri, is an Engineer from the Antioquia School of Engineering. He holds a Master’s degree in Finance from the EM Strasbourg Business School, as well as an MBA from the School of Administration, Finance and Technological Institute (EAFIT) in Colombia. He also has a master’s degree in Business Excellence from HEC Montréal and studied Mergers and Acquisitions at the Stanford University Graduate School of Business and participated in the Singularity Executive Program. Daniel began his career in the automotive industry in 2011 when he joined Renault in Colombia where he occupied different positions in logistics, transport, and finance. Echeverri also served as Executive Secretary for the Americas in Brazil for the brand from 2018 to January 2020, the month in which he expatriated to take over the Financial Direction of the subsidiary in Mexico. In 2023, he begins his journey in the entertainment industry as Executive Director of FP&A for Warner Bros Discovery in Mexico. --- ### Take the first step on your road to the C-Suite.👇 Download the '**[Journey to CFO](https://www.financealliance.io/journey-to-cfo/)**' eBook for more tips and advice to help you progress on your journey to the C-Suite. ### What’s in this eBook? - ****The secrets of the CFO role:** Get the inside scoop on the essential traits and skills needed to lead at the highest level. - ****Explore the intricacies of educational backgrounds and professional qualifications**, and learn how to strategically leverage your expertise to ascend the ranks. - ****Navigate the competitive job market** and ace the interview process with insider tips and expert guidance. - ****Developing essential CFO skills:** Master the skills that every successful CFO needs in their arsenal. - ****Developing an action plan:** Forge a strategic path toward your goal with a clear, actionable plan. [Download the eBook](https://www.financealliance.io/journey-to-cfo/) ### "It was outstanding, the topics were very interesting." - Ahmed Morsy URL: https://www.financealliance.io/virtual-event-case-study-ahmed-morsy/ Last updated: 2025-08-15T08:07:50.000Z We recently wrapped up another exciting FP&A Summit and this time, it was a virtual event, which meant lots of different finance professionals from around the world attended. But as always, the stars of the show were our outstanding speakers. Handpicked for their expertise and ability to captivate audiences, these brilliant minds from the world of finance shared their industry secrets and innovative strategies with our audience. While we take great pride in the content we deliver, nothing speaks to the success of an event quite like the feedback from our valued attendees. That's why we're thrilled to share some feedback we got from an attendee and a valued member of our [community](https://www.financealliance.io/community/), Ahmed Morsy. Ahmed is a Financial Reporting Manager who's not only been a consistent participant in our events but also a passionate supporter of our mission to upskill the finance community. His feedback not only gives us insight into his personal experience at the FP&A Summit but also offers a glimpse into the impact our summit has on our global attendees. So without further ado, let's dive into what Ahmed had to say... ### What inspired you to attend our event? I was impressed with the event's topics and the high number of professional speakers at the event. ### Did the event meet your expectations? Yes, it was outstanding and the topics were very interesting. ### What did you enjoy most about the event? The FP&A Summit was really helpful, I enjoyed it to the max. Katrina Martinez's session, "*How to differentiate yourself in an AI World*", was really amazing. ![Ahmed Morsy testimonial](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/ahmed2.png) ### Did you learn anything new from the event? Yes, AI will have an impact for sure and we need to use it as a tool for improvements. ### Would you recommend attending our finance alliance event to other professionals in your field? Sure I will, the events are useful for finance professionals. ### Are there any topics or areas of expertise you'd like to see covered at future events? More details on how to use AI to improve our duties and enhance our analysis. --- ### Don't miss our next event! Network with like-minded finance experts to benchmark your processes, rejuvenate your strategies, and accelerate your career growth when you attend any of our [events](https://events.financealliance.io/?%5Fgl=1%2A1dfbm6l%2A%5Fga%2AODIzNzQwOTAxLjE2ODA5NDY3Mjk.%2A%5Fga%5F2NXFSBEP4N%2AMTY4ODExODUyNC4zMTkuMC4xNjg4MTE4NTI0LjAuMC4w)! ### Join our finance community (it's free!) Ready to power-boost your career and take it to new heights? Then don't wait any longer! Join our community of finance professionals and start networking with brilliant, like-minded professionals, benchmark your methods against the best, give a fresh, invigorating touch to your strategies, and kickstart your journey toward phenomenal career growth. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### Why we need to amplify diverse voices in our companies URL: https://www.financealliance.io/why-we-need-to-amplify-diverse-voices-in-marketing/ Last updated: 2025-04-05T07:33:48.000Z *This article is adapted from Patrick's appearance on CMO Convo, "*[*It's a diverse world. Marketing should be too.*](https://www.cmoalliance.com/cmo-convo-its-a-diverse-world-marketing-should-be-too-patrick-reynolds-jade-warne/)*"* I’m Patrick Reynolds, and I’m the CMO of a company called BlueConic, which is a technology company in the customer data platform space. BlueConic is a portfolio company of Vista, which is the largest technology investor in the world. I’ve always been an observer of people in life, which is an expression that I learned quite early on. I try to be a cultural anthropologist of humans in the wild, as it were. So on the subway, in the park, when they don't know that you're observing, you're observing (in a non-creepy-weird way). I always keep an ear open and my eyes open to how people look, behave, and interact. And I think that's always been really core to me. I take a journalistic perspective on how to do marketing, I guess. It's important to talk about diversity, equity, and inclusion (DEI) from a marketing perspective and make sure that we’re building the kinds of organizations that represent us as people and our businesses well. I’d also like to speak secondarily as a human who recognizes the dramatic and desperate need for a more inclusive, multicultural, multi-palleted world. And then I’d also like to speak to you as a cisgender, middle-aged white guy, because I think that persona is critical to making everything else work better, faster. ## **Defining diversity, equity, and inclusion** To me, DEI is about creating a space where everyone is welcome. And a different way to say that is that I want to create an environment that broadly looks like the world we live in. Up until quite recently, the business world was a little cocoon nested within this increasingly diverse world, but immune to it. It was a little white bastion in the middle of a very multicolored ocean or constellation. But that dog won't hunt anymore. So we need to figure out a way to make what happens inside the four walls of the business more closely mirror what happens outside of them. --- [10 mistakes I made as an FP&A Analyst | Asif MasaniI would like to share the top 10 mistakes I made as a young analyst. I hope that others can learn from my experiences and avoid making them in their own careers.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/brett-jordan-ehKaEaZ5VuU-unsplash-2.jpg)](https://www.financealliance.io/10-mistakes-i-made-as-an-fp-a-analyst/) --- ## **Business is integral to a better society** > *“Diversity is being invited to the party. Inclusion is being asked to dance. And belonging is dancing like no one’s watching.”* It's important to be fluent in all of the idioms of the audience that you’re candidly marketing to or selling to. So, even though we're selling enterprise-level software, we're seeing the buyers of that kind of product change. Ten years ago, they looked a lot like me. And that's still the case in certain places. Now, though, we're finding people who are younger, more diverse, and have a different background. And if I come at them with a series of Seinfeld references, dad jokes, and baseball terms, it's probably not going to land. So it's enlightened self-interest for me to have people who can make us fluent in the language of our customers. If you want to be purely financially motivated, that's one way to look at it. The other way is that we need to create a better society, and business is integral to creating a better society for better or worse. We can't fix the fact that business has a large outsized presence because it does. So let's capitalize on it and try to advance the ball as much as we can. So there's both a financial and business motive. I also believe that a more diverse set of marketers is preferable and better over time than a less diverse set of marketers for business results. I’d also like to create a world that I'd like to work and live in, and that's one that welcomes and celebrates the diversity of everyone. Another thing that's really interesting is that younger people are currently making very interesting employment decisions. You read a lot of things that’ll say a lot of people are opting to work less or more remotely, or they'll take less money for more latitude of schedule. I believe that a lot of that has to do with the fact that the business doesn’t map to their values, and they almost want to limit their exposure to something that's contrary to their values. If your work life is just too different from your life-life, you're going to want to shrink it so that you can have your life-life. So if we can make work life a little more like the outside world, then maybe we can have a more harmonious relationship between work and personal life. ## **Establishing authentic DEI in marketing** When it comes to DEI, companies have been talking the talk for a long time, but it’s only recently that they're beginning to walk the walk. Optics have always been essential. You needed to look suitable for a company. So people would make great efforts in their advertising campaigns to show a vast array of people. But behind the scenes, the people making those things were typically much more like me than what the company was portraying. Now, I think that’s starting to change. I think it’s changed dramatically in the case of women, but I don't think it's changed as much as it frankly needs to in the case of people of color. I think that it’s happening, but it's just not happening at the rate and pace that I think anyone would be comfortable with. It's very ironic because marketing is typically the canary in the coal mine. It'll put it out there that this is where we need to be. But then if you actually pull back the covers on the people making the marketing, they're talking the talk but not walking the walk. It's a lot of white people making commercials about how important diversity is. Now that’s changing, and I think that's critically important. But that's another irony that sticks in my craw a little bit. A lot of the startups I've been a part of are very clubby. You have a small number of people in the venture capital community giving money to a small number of people that they can rely on. And it perpetuates this handing off the baton within a circle so it really just goes around. Most of these people are really good people, in my experience. But again, it's a very small circle. When I worked for MasterCard, which is obviously a large, publicly traded global company, diversity was real there. I’d literally be the token straight white guy in the room, and I’d be amongst all of God's creatures. It was fantastic; the ability to harmonize that energy and get that thinking together and all those broad perspectives. We also have a terrible fault in the US of thinking in red, white, and blue terms and thinking of a very US-centric world, which is becoming less the case all the time as well. So for all those reasons, just hearing people, hearing how they talked, hearing their stories, hearing about their families, seeing their pictures and all that, it was an awakening, and it made us better at what we did. --- [The ultimate data cleaning checklist for financeIn this blog, we get into the nuts and bolts of data cleaning techniques. We’ll also provide practical data cleaning steps to help guide you through the process.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Data-cleaning-checklist-2.jpg)](https://www.financealliance.io/data-cleaning-techniques/) --- ## **DEI initiatives and their impact on customers** If we look at some examples of DEI initiatives from other brands and how those initiatives have affected customers, I guess we'd be remiss to not talk about the Bud Light fiasco. Just because you say it, doesn't mean it’s so. I’d just file that under that heading. I think that there was absolutely nothing wrong with what Bud Light did. In fact, I could find a lot of things that are admirable about it, providing it was coming from a genuine place and it wasn’t something they did so that they could get a good DEI grade in their board meeting. I don't know if the average consumer, much less Kid Rock, has privy into what they're talking about when they're creating that kind of campaign. So I think it's a little self-serving for the haters as well. But it just goes back to the idea that you’ll make things that work for your audience, provided you know those inputs. I can market to a diverse array of customers better if I have a diverse array of people helping me market. You can also think about cosmetic companies like Fenty Beauty, who came in with a wide collection of makeup that suits all skin tones. And now this is the norm in the cosmetic industry. I don't think the initial people who created these kinds of cosmetic products and marketing campaigns were doing it from a place of exclusion. I think they just didn't know. They're more like sins of omission than commission. I don't think anyone ever intended to make makeup that wouldn’t work for people of color. I think it just never occurred to them that it wouldn't work for those people because they look like me. If it's all super single-threaded, elitist, white, or American. We're not doing it from a bad place. It's just the language that we speak and the culture that we grew up in. But it doesn't work anymore. So you need to bring other people into the room and they can sanity check your stuff. How is it plausible that you can ask a very small group of people who aren’t what you want them to be, to be more like what you want them to be? Imagine I'm going to tell a room of 10 people who are all white, six went to Stanford, and four went to Harvard, “I want you to now be of the people and go out and cast a big net for the people in Hoboken, New Jersey, and Brixton, London.” How is that going to ever work? It won’t. So the question is, do you actually want that? Or do you want to look like you want that? If you actually want that, you need to bring in people who have some understanding of those places. ## **Twitter’s role in DEI discourse** Twitter has recently been going through a bit of a chaotic time under Elon Musk's management. Personally, I view the platform as a vast wasteland that I’ll occasionally glimpse into on my own time just to see how crazy the world is. And then I quickly slam it shut and run away. I think that Elon Musk is trying to make the argument that it's plumbing. He’s saying, “Put whatever you want on there. We're not here to sanction it. We're not a publisher.” And yet on the 2nd of June, the second day of Pride, he was actively promoting anti-trans rhetoric. Twitter wants us to think that it's not a publisher, like the New York Times, promoting hate and filth and exclusivity and all these other things. It's a forum, it's a message board, and people put what they want on it. I don't think that’s going to hold true anymore, especially if you're going to charge people to put things on there and you're profiting from that, and you have the owner of the company actively amplifying toxic and harmful rhetoric. It's pretty transparent. It's also not a place where I think serious business should be done. I'm not sure anything should be done on it. If wishes were fishes, I’d rather it didn't exist. But it’s drawn into a stark conversation about how powerful a weapon Twitter can be. A weapon is a word that I use intentionally. Words can be weaponized to turn people from pretty sane, normal people into pretty fringy people, just through a constant stream of misinformation and bad information. And it's great that Twitter throws its hands up and says, "We're not posting anything, we're just passing it along," but they're making money from it. That's what's so bothersome about it. People should just use Twitter very seldom, and never for serious business. In other words, I don't think running B2B software marketing campaigns on Twitter is time well spent. "Do I need software, let me see what Twitter thinks?" It’d just never occur to me as a buyer. There are LinkedIn, forums, B2B review sites, Gartner, and Forrester. I’d go to those places to do my research. There are other kinds of forums that are specific to the topic. I wouldn’t go to Twitter to do serious business myself. It's going to be an incredibly wild political season here in the US. With Trump now being reapproved to be back on Twitter, it's just going to be a mudslinging mess for several months. And all of this will initially harm DEI as a concept because anybody who's for those ideals, these loudmouths, will be against them and they'll denigrate them. Then they'll bring in all their sheep behind them to put more wood on that fire. I think long term, it's good because I’m an optimist. I believe that with all of this hate, for every action there's an equal and opposite reaction. I think in time, there’ll be a cry to put down these people. But I think that fire’s going to have to burn out first. I actually think it’ll advance the case for a more tolerant, diverse, inclusive world. It's just going to take a minute. What's really frightening though is when you think about what’ll happen with the proliferation of AI. You now have big machines that can smell the soft spots, can see where the demographics are, and can see in real-time or near real-time where an election is trending. For example, "We're losing in the state of Louisiana, let's now gin up some message that we know will resonate with voters because we're damn near omniscient. And then let's just put it into everyone's feed down there unsolicited, and try to turn these outcomes." It's literally Mary Shelley's monster come to life, but the monster is now running the experiment. And it's crazy and vaguely terrifying and horrible all at the same time. --- [Journey to CFO eBook | Finance AllianceDownload the Journey to CFO eBook and take the first step on your road to the C-Suite.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/FA_Journey_to_CFO_eBook_Meta_.png)](https://www.financealliance.io/journey-to-cfo/) --- ## **Upholding DEI values beyond financial gain** At BlueConic, we have really, really tight alignment amongst the leadership team and amongst Vista around our values. I think our values and values alignment was one of the big reasons that Vista was attracted to BlueConic and BlueConic to Vista. We’ve celebrated Mental Health Month, Women's Month, and Native Indigenous Peoples Month. We’re really into that, not because it helps us sell any software (it doesn't do a single thing for software), but because it sends out a beacon to the world that these are our values. And if your values map to our values, if you want to talk, cool, and if you don't, that's cool, too. Doing the right thing when there's no financial gain is something that’s really, really important to us. It's not lost on me that BlueConic is interesting in many different ways, but we have a young female CEO, a female CRO, and a female Chief People Officer. We also have high-ranking women in product, in engineering, in everything. First of all, I don't think it’s by design. But secondarily, it prevents us from going into some of these dark corners that maybe some of our competitors go into. We stick to the sunny side of the street at BlueConic. ## **Overcoming DEI obstacles: Strategic approaches for marketing teams** When looking to overcome some of the obstacles of implementing DEI, you just have to work backward from, "What do you want?" Let’s say you’d like to have an inclusive team that’s representative of the audience that you’re marketing to. Okay, so how do you do that? Let's just say in this case, "I need to find more people of color than we have presently in the company". How do you do that? The first thing is you’ll recruit in places where people of color actually go to school. And it might not just be Stanford and Harvard. It might be state schools or tech schools. It might be all kinds of different places that are non-traditionally recruited from. How do we make sure that diverse candidates get into those schools? You have to have community outreach programs, you have to do days of charitable work, and you have to talk about STEM (science, technology, engineering, and math). When you're doing your community days, make sure that it's not just for the suburban kids, that it's also for the kids right smack-dab in the middle of the city. It's root and branch, all the links of the chain have to connect in order to get the outcome you want. So that's something that we're hard at work on, there's tonnes of work to be done. The other thing is that you have to KPI it. It's an objective of mine. It's not like, "Hey, if you find somebody that's diverse, that'd be cool". It's, "You're being evaluated on your ability to cast a broad slate and bring in the kinds of people that we want to bolster up." Just like I am for pipeline creation, bookings, revenue, cash, all of those things. DEI is also part of that letter set. ## **The power of diversity in self-enlightenment** In my view, there’s a very small fringe component of the world that wantonly and knowingly does the wrong thing. If you talk to 80% of the world and ask, "Should workplaces be diverse? Should they be inclusive? Should they be equitable?" They go, “Of course!" Most people aren’t actively unfair. And most people think that they manifest DEI in their private life and their work life. It's only when you’re exposed to someone not like you, who gives you the eyeball when you say something or you overhear a conversation. You don't know what you don't know until you know. And you'll never know if you don't bring people into your circle who force expose you to it. My children are an amazing foil for me. I think I’m a liberal, enlightened, progressive, wonderful human being. But not a day will go by that I won’t get called to account for something I’ve said. At the time, it hasn’t even occurred to me that what I’ve said might be offensive to anybody. It could be something around pronouns or expressions that I learned from TV as a kid that now makes my kids’ heads explode. Until somebody is different than you and you hear how they do it, or they call you out on how you do it, you just don't know. And when you do know, you go, "That makes so much sense." And you actually do move closer to enlightenment. You’ve still got a long way to go, but you’ll move closer to it. But you'll never ever read about that. You can't search websites or attend conferences about it. Your circle must be inclusive of people who are very different from you, or you're just never going to get it, in my view. And that's why it's so important to hire people who are broadly representative of the world so that you go, "I’m learning so much every day, and I was supposed to be the teacher". I learn 10x what I teach because I'm surrounded by people that I’ve not been around before, and I'm so much better for it. --- **Diversity is essential for success in every department, including finance. What role are you taking as a finance professional to champion it? Do you need help finding the way forward?** **Share your story with a global network of finance leaders inside the** [**Finance Alliance Community Slack channel**]( )**.** [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### 11 SaaS finance strategies for scaling subscription revenue URL: https://www.financealliance.io/saas-finance-strategies/ Last updated: 2025-04-10T07:58:29.000Z There’s no denying that we’re living in the era of Software-as-a-Service (SaaS), especially considering that [70% of apps](https://startupbonsai.com/saas-statistics/#:~:text=Companies%20estimate%20that%2070%25%20of,80%20IT%2Dsanctioned%20SaaS%20apps.) used by companies today are SaaS-based (and this will likely increase to 85% by 2025). But what does this mean for you as a finance professional? Well, for one, it has significantly reshaped the landscape of financial management within SaaS companies. Forget about just crunching numbers, you’re now navigating the ins and outs of SaaS finance, which focuses on recurring revenue and the never-ending quest to reduce churn. Join us as we dive headfirst into the world of SaaS finance, helping you to better understand the industry, how it operates, and strategies to help you succeed in your role. **Learn about:** - [How a SaaS business model operates](https://www.financealliance.io/p/503179f2-b859-4cc9-bf6e-0da538696bd7/#what-is-a-saas-finance-business-model) - [The power of recurring revenue](https://www.financealliance.io/p/503179f2-b859-4cc9-bf6e-0da538696bd7/#saas-finance-the-power-of-recurring-revenue) - [Types of SaaS finance and pricing models ](https://www.financealliance.io/p/503179f2-b859-4cc9-bf6e-0da538696bd7/#types-of-saas-financing-pricing-models) - [Tips and strategies to scale subscription revenue](https://www.financealliance.io/p/503179f2-b859-4cc9-bf6e-0da538696bd7/#11-strategies-to-scale-subscription-revenue) - [Why SaaS companies lose money](https://www.financealliance.io/p/503179f2-b859-4cc9-bf6e-0da538696bd7/#why-do-saas-companies-lose-money) ## What is a SaaS finance business model? The SaaS model involves **accessing software through a subscription** online, rather than purchasing and installing it on separate devices. SaaS business models can be confusing if you’re accustomed to more traditional industry frameworks. There are new metrics to consider, such as: - Monthly Recurring Revenue (MRR) - Annual Recurring Revenue (ARR) - Customer Acquisition Cost (CAC) - Lifetime Value (LTV) - Churn rate These metrics, though different from the typical balance sheet ratios, paint a clear picture of the health of a SaaS business. Take MRR, for example. It reflects the predictability of your revenue stream, a key factor for investors and stakeholders. Meanwhile, LTV and CAC together indicate how sustainable your growth is. Understanding and keeping an eye on these metrics is a key success factor for any SaaS finance professional. One of the unique characteristics of SaaS is the subscription model, where **cash flow management** is paramount. Cash flows in a subscription model differ from those in traditional models due to the nature of recurring payments. Therefore, mastering the art of managing these cash flows and **optimizing recurring revenue** is vital. --- [The CFOs guide to effective SaaS cost managementIn this blog post, we’ll dive deep into the world of software management, revealing its game-changing importance and serving up some strategies for optimizing spend. We’ll also share practical tips to reduce SaaS spend and recommend the best tools to make the whole process run a lot smoother.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/SaaS-cost-management.jpg)](https://www.financealliance.io/saas-cost-management/) --- ## SaaS finance: The power of recurring revenue SaaS is different from traditional software because it makes money from **repeat customers**. In SaaS, you earn money by offering a service that customers use often, instead of just selling something once. In a way, your customers are "renting" a valuable business service from you, resulting in a steady, predictable cash flow. But recurring revenue doesn't just involve bringing new customers on board - it's also about keeping the old ones. Hence, you need a balanced focus on acquiring new customers and retaining existing ones. ![Recurring revenue - SaaS finance](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/finance-SaaS.png) New customers + existing customers = recurring revenue However, here's the catch with recurring revenue – it's all about *timing*. Cash inflow occurs daily, as your service is being utilized. But a common mistake made by these companies is spending money they haven’t earned yet. This can happen when you spend this month’s profits too soon and before the month ends, you’re up against service disputes and an influx of refunds. To avoid this nightmare, keep a tight grip on your cash flow. ## Types of SaaS financing & pricing models Picking the right pricing model for your SaaS business is a critical decision that can make or break your revenue goals. Here are a few SaaS financing and pricing models to consider: **Pay-Per-User:** This is the most common SaaS pricing model. It's simple: you charge for each individual user on the platform. It’s akin to selling tickets to a show - the more, the merrier. **Pay-Per-Active-User:** A twist on the traditional per-user model. Here, you only charge for users that are actually using the product. It’s a great option if your service is used sporadically by different team members. **Volume Pricing**: Also known as tiered pricing, this model offers discounts for larger user volumes. It's like buying in bulk at the supermarket - the more you buy, the less you pay per unit (*hopefully*). **Per-Storage Pricing:** Mostly used by cloud storage services, this model charges customers based on the amount of storage they use. Think of it as renting a storage unit but in the cloud. **Feature-Based Pricing:** With this SaaS finance model, you charge based on the features a user wants access to. If they want more features, they have to pay more. **Pay-As-You-Go:** Just like it sounds, customers pay for what they use. It’s flexible but can be unpredictable. You may associate this one with mobile phone usage options where you pay for the data you consume. **Flat-Rate:** This is a one-size-fits-all model where you offer unlimited access to your service for a set price. **Free, Ad-Supported:** This model offers your service for free but generates revenue from ads shown to users. It's like watching network television - the shows are free, but you'll have to sit through some commercials. --- [Top 10 SaaS CFO duties for scaling an epic SaaS companywhat are the main SaaS CFO duties on your plate? And what can you do to lead the finance team and the company to roaring success? In this article, we’re diving into the top 10 SaaS CFO duties for scaling an organization to new heights![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/SaaS-CFO-Duties-2.jpg)](https://www.financealliance.io/top-10-saas-cfo-duties/) --- ## 11 strategies to scale subscription revenue To navigate the complex SaaS landscape, there are a few strategies to help you keep profits flowing.👇 ### 1\. Create a robust pricing strategy The 'right price' for a SaaS product isn't just about covering costs and securing a profit. It’s a delicate balance that considers customer value, competitive landscape, and company goals. As a [SaaS CFO](https://www.financealliance.io/top-10-saas-cfo-duties/), you need to create a pricing plan that earns money *and* reflects the worth of your service. This involves understanding the value perception of your customers, studying competitors, and frequently reassessing and fine-tuning your pricing. > Remember, the 'right price' isn't static - it evolves with your business and market dynamics. ### 2\. Cultivating customer relationships SaaS companies thrive on customer loyalty. As a CFO, you have a role in understanding customer behavior and driving initiatives that enhance customer lifetime value (LTV). 💡 ****Tip:** Work with your sales and customer success teams to keep customers and sell more. ### 3\. **Revenue recognition** Recognizing subscription revenue isn't as straightforward as it seems. The rules can be tricky, and you'll need to ensure compliance and accuracy in your financial reporting. While subscriptions provide a steady stream of income, when should you recognize subscription revenue? Is it when payment is received? When the service is delivered? Or should it be spread over the subscription period? Generally, revenue should be recognized when it's earned and realizable, not necessarily when it's received. To navigate this, you'll need a comprehensive understanding of financial standards. Training can help your finance team stay up-to-date and regular updates ensure financial reports are accurate and comply with regulations. ### 4\. Cloud cost optimization Cloud services are vital for SaaS, but without strategic management, costs can spiral. The key to cloud cost optimization is understanding your cloud spending thoroughly. Talk to your tech team about cloud services, costs, and usage. Use cloud cost management tools to see how much you're spending in real time. Remember, the saved penny today is the growth investment for tomorrow! --- [5 supply chain risk mitigation strategies to dodge disasterHow can you mitigate supply chain risks as effectively as possible? Find out in this article, where we explore five key supply chain risk mitigation strategies to help you steer your company toward financial stability and resilience.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/supply-chain-risk-mitigation-strategies-2.png)](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) --- ### 5\. Growth investment Speaking of growth investment, this is another critical area where finance SaaS teams can make a significant impact. Balancing the need for growth with the realities of burn rate and cash flow is a vital role that CFOs play in SaaS companies. A great way to create a smart investment strategy is to focus on one that balances short-term cash needs with long-term growth objectives. This could involve investing in new features, market expansion, marketing, or even [mergers and acquisitions](https://www.financealliance.io/risks-of-mergers-and-acquisitions/). ### 6\. Managing cash flows In the subscription-based world of SaaS, managing recurring revenue and cash flow is crucial. CFOs need to ensure they have a strong handle on cash flow forecasts and take steps to optimize the timing of cash inflows and outflows. ### 7\. Tailor your Chart of Accounts (CoA) Your Chart of Accounts is more than just a list of accounts where you record your company's financial transactions. It's a structured representation of your business operations, which can drastically influence your financial analysis and decision-making. With that in mind, you'll want to tailor your CoA to reflect the unique aspects of SaaS finance economics. Consider elements like deferred revenue, capitalized software costs, and various revenue streams. Remember, a well-crafted CoA is your first step toward clear and actionable financial reports. ### 8\. Staying compliant Regulations in the tech industry can change rapidly, and non-compliance can lead to significant penalties. As a CFO, it's your responsibility to stay on top of these changes and ensure your company is always compliant. This may involve regular audits, maintaining robust internal controls, and investing in compliance training for your team. ### 9\. Promoting a data-driven culture SaaS companies are rich in data. CFOs should promote a culture that values this data and uses it to drive decision-making. Invest in analytics tools, train staff in data analysis, and make data accessible and understandable to all relevant team members. It’s also wise to take time to get to know your data sources. Each source gives you unique insights and understanding these data sources, their interconnections, and their potential for insights is crucial. With this knowledge, you can leverage analytics tools effectively, [turning raw data into strategic actions](https://www.financealliance.io/7-data-management-problems-and-solutions/). ### 10\. Master financial SaaS forecasting In the SaaS industry, forecasting can sometimes feel like trying to predict the weather in a tornado. But despite the inherent unpredictability, there are techniques and tools to make this process more accurate. [Scenario planning](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/), for example, can help manage the inherent risks. By forecasting multiple outcomes based on different assumptions, CFOs can prepare for a range of possibilities and ensure the company is ready to pivot as needed. ### 11\. Leveraging technology SaaS CFOs have a host of technology tools at their disposal to streamline financial operations. From automated billing systems to sophisticated financial modeling software, these tools can save time, increase accuracy, and provide more insights for better decision-making. Automation can be a game-changer for financial operations. It can remove manual tasks, reduce errors, and free up time for more strategic initiatives. --- [Managing Complex Change Matrix for CFOs (Lippit-Knoster Model)Change is often necessary to help companies stay adaptable, competitive, and prepared for new challenges. One tool that has proven helpful in this area is the Lippitt-Knoster Model for Managing Complex Change Matrix, which provides a clear framework for handling change.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/managing-complex-change-model-2.jpg)](https://www.financealliance.io/managing-complex-change-matrix/) --- ## Why do SaaS companies lose money? SaaS companies often lose money, especially in the early stages, due to high customer acquisition costs (CAC) and upfront investments in product development and infrastructure. They are betting on the fact that the lifetime value (LTV) of a customer will eventually exceed these initial costs. Let’s take a closer look at some of the key reasons why SaaS finances can often get worse before they get better: ### High customer acquisition costs In a competitive market, attracting new users demands substantial investment in marketing and sales efforts. This might include costs associated with advertising, sales team salaries, incentives, and even freemium offerings to entice users. ### Upfront product development costs Creating innovative, user-friendly, and reliable SaaS products requires significant initial expenditure. From hiring skilled engineers to licensing necessary technologies, the expenses can quickly pile up before any revenue streams in. ### Infrastructure expenditure SaaS companies need robust and scalable infrastructure to support their services. The investment in servers, storage, [cybersecurity](https://www.financealliance.io/cfo-cybersecurity/), and compliance measures can lead to substantial outlays. ### Recurring revenue model Unlike traditional sales, the SaaS finance model banks on recurring subscriptions which means revenue trickles in slowly over an extended period. This time lag between investment and return can cause a temporary deficit. ### Investment in growth To keep up with the fast-paced SaaS industry, companies need to continuously innovate and expand their product offerings. Whether it's adding new features or expanding to new markets, these growth strategies necessitate further investment. Remember, though, that this is a calculated gamble. SaaS firms believe that customers will bring in more money than the cost of acquisition. This makes the business profitable in the long term. --- ### SaaS finance FAQs How does SaaS make money? SaaS companies make money primarily through subscription fees charged to users for access to their software. Other revenue streams may include upselling additional features or services, and in some cases, ad revenues or transaction-based fees. What is the subscription model for SaaS? The subscription model for SaaS is like a gym membership for software. Users pay a recurring fee, usually monthly or annually, for access to the software. This approach provides businesses with predictable revenue and users with the flexibility to discontinue the service when they no longer need it. What are some crucial financial strategies for SaaS companies? Key financial strategies for SaaS companies include implementing a robust pricing strategy, effectively managing revenue recognition, optimizing cloud costs, investing in growth while balancing cash flow, and promoting a data-driven culture. --- ### **Join our finance community!** The Finance Alliance community is the ultimate space for finance pros who want to accelerate their careers. Connect with our fellow finance leaders to network, discuss and share. Join now to be a part of the conversation. [Join our Slack community](https://www.financealliance.io/community/) ### 10 mistakes I made as an FP&A Analyst URL: https://www.financealliance.io/10-mistakes-i-made-as-an-fp-a-analyst/ Last updated: 2025-04-07T10:10:06.000Z As a young FP&A Analyst, I have made many mistakes early in my career. Some of these mistakes were minor. In contrast, some others had significant consequences. Here, I would like to share the top 10 mistakes I made as a young analyst. I hope that others can learn from my experiences and avoid making them in their own careers. ### Mistake # 1: Underestimating the importance of data accuracy One of the biggest mistakes I made was underestimating the importance of data accuracy. As an [FP&A](https://www.financealliance.io/future-of-fp-a/) analyst, you're responsible for ensuring data used in your analysis is accurate and up-to-date. However, in my early days, I often assumed that the data I was given was correct, without verifying it. This led to inaccurate results and false conclusions, which could have easily been avoided. 💡 ***Lesson learned:** **Take the time to double-check your data. Build internal checks and balances.* ### Mistake # 2: Neglecting to communicate with other departments The next big mistake was neglecting to communicate with other departments. As an FP&A analyst, I was responsible for analyzing data from many different sources, including sales, marketing, and operations. However, I failed to reach out to these departments to clarify data or get more information. This resulted in missing out on important insights and made it difficult for me to do my job effectively. 💡 ***Lesson learned:** **Don't be shy to pick up the phone or walk up to their desks and ask them*. ### Mistake # 3: Not presenting information in a clear and concise manner Another mistake I made was not presenting information in a clear and concise manner. It is important to be able to communicate your findings to others in a way that is easy to understand. --- [7 reasons why FP&A is becoming a popular career pathFinancial planning and analysis (FP&A) is one of the most sought-after careers in the finance industry. There has been an exponential rise in the availability of data.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/pexels-mikael-blomkvist-6476589-2.jpg)](https://www.financealliance.io/7-reasons-why-fp-a-is-becoming-a-popular-career-path/) --- However, I often presented my findings in a complex and complex manner. This made it difficult for others to understand my recommendations. And led to misunderstandings and miscommunications. That could have easily been avoided if I had taken the time to present my findings in a clear and concise manner. 💡 ***Lesson learned:** *Simplify your message as if you are teaching a 5th Grade student.* ### Mistake # 4: Failing to prioritize tasks I also made the mistake of failing to prioritize tasks. As an FP&A Analyst, you often have multiple tasks to complete, each with its own set of deadlines. However, I often failed to prioritize my tasks, leading to missed deadlines and rushed work. This not only negatively impacted the quality of my work but also put undue pressure on myself and my team. 💡 ***Lesson learned:** **Prioritize your tasks. Keep others informed ahead of time if you are running late.* ### Mistake 5: Failing to consider the bigger picture I focused too much on the numbers and not enough on the [bigger picture](https://www.financealliance.io/10-big-picture-financial-planning-steps/). While analyzing financial data is a key aspect of my job, it's also important to understand how this data fits into the broader context of the organization and its goals. By neglecting to consider the bigger picture, I often missed opportunities to identify potential growth areas or potential risks. 💡 ***Lesson learned:** **Always understand or ask why are you doing something that you are being asked to do.* ### Mistake 6: Relying too much on historical data Another mistake I made was relying too much on historical data. While historical data can be useful in making projections and analyzing trends, it's also important to consider future changes and developments. By relying too much on historical data, I failed to anticipate changes in the market and missed out on opportunities to make informed recommendations. --- [9 common myths about FP&A roles | Asif MasaniDespite the importance of FP&A, there are many myths and misconceptions about FP&A that can lead to misunderstandings about the work that FP&A professionals do.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/fp-A-myths.jpg)](https://www.financealliance.io/9-common-myths-about-fp-a-roles/) --- ### Mistake # 7: Not seeking feedback I also made the mistake of not seeking feedback. As an FP&A Analyst, it's important to get feedback from others, both within your own department and across different departments. This feedback can help you to identify areas for improvement, gain a deeper understanding of the business, and make more informed decisions. By neglecting to seek feedback, I missed out on these valuable opportunities to grow and develop as an analyst. ### Mistake # 8: Not challenging assumptions Another mistake I made was not challenging assumptions. As an FP&A analyst, it's important to be critical and analytical. And to question assumptions and data to ensure the accuracy and validity of your findings. By not challenging assumptions, I often missed important insights and made incorrect assumptions that led to misinformed decisions. ### Mistake # 9: Not using technology effectively Finally, I made the mistake of not using technology effectively. As an FP&A analyst, a wide range of tools and technologies are available. This can help you to [automate routine tasks](https://www.financealliance.io/chatgpt-for-excel/), analyze data more efficiently, and make better-informed decisions. By not taking full advantage of these tools and technologies early on. I missed out on the benefits they could have provided and was less effective in my role. ### **Join the Finance Alliance Community** Sign up to our free [Finance Alliance Slack community](https://www.financealliance.io/community/) and start networking with other FP&A professionals, CFOs and finance leaders. Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. So, what are you waiting for? [Join our Slack community](https://www.financealliance.io/community/) ### 9 mind-blowing tips from a data visualization expert URL: https://www.financealliance.io/9-data-visualization-expert-tips/ Last updated: 2026-03-05T17:03:07.000Z The old adage that a picture paints a thousand words is very true when it comes to data visualization, except in this case, it could be a thousand megabytes. It’s all about portraying information in a digestible and actionable form. Some do’s and don’ts when it comes to building visualizations and being an effective data journalist (or data visualization expert) include: ### 1\. Know your audience As a data storyteller in finance (or any industry), you need to produce visualizations that’ll work for all stakeholders and give them what they need. Understand that some users will only want to see the high-level numbers, but others will like the ability to “drill down” into certain aspects and learn more. One simple option for creating hierarchies in the story is to utilize bookmarks and links to further visuals to allow users to jump from one visual/report to the next. It’s also paramount to be aware of sensitive data and the audience who will have access. ### 2\. Set clear objectives Just like every project, be clear about the aims and objectives of your stakeholders. What are they trying to achieve and what answers do they need from the data? ### 3\. Adopt an agile approach to building dashboards and reports Check in often that what you’re building is telling the right story. Don’t fall into the trap of “cherry picking” data for the purpose of meeting a milestone or making a visual work. 💡 ****Remember**: The data needs to tell the ****whole story**, not part of the story. ### 4\. Name your visuals appropriately Simple descriptive headings can give all the context a user might need for what a visual is portraying. On the topic of text, I’ve always found it better to use simple fonts, e.g. Sans, and keep headings to a consistent size. --- [8 principles of data visualization in financeIn this article, we’ll delve into these principles, revealing how they’re reshaping the finance industry. We’ll also discuss data storytelling in finance and offer some best practice tips from the experts.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/principles-of-data-visualization-blog1-2.jpg)](https://www.financealliance.io/8-key-principles-of-data-visualization-in-finance/) --- ### 5\. Be wary of showing “too much” TMI can lead to TL;DR which defeats the purpose of data visualization. If your visuals or legends are being truncated, you’re probably trying to show too much and should consider a different visual or table. 💡 ****Tip:** Tables are still visuals and very powerful when used in the right scenarios to show small lists of pertinent data. ### 6\. Highlight KPIs When utilizing tables, make good use of conditional formatting to highlight KPIs and draw a user’s attention. ### 7\. Don’t over-slice the pie Much like at the bakery, a pie with too many slices is probably ugly and not quite satisfactory. Avoid using these when there are too many categories. The same goes for donuts! The right chart should make the data easier to understand but also present it in the right light to the user. For example, a simple dial chart can be compelling for showing progress toward a goal. --- [7 data management problems and solutionsData management plays a pivotal role in driving insightful decisions and ensuring the financial success of a company. But let’s face it – navigating this intricate landscape can feel like a battle, filled with data management challenges like inaccuracies, security breaches, and complex integrations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/markus-spiske-8OyKWQgBsKQ-unsplash-2.jpg)](https://www.financealliance.io/7-data-management-problems-and-solutions/) --- ### 8\. Choose colors wisely When it comes to colors, keep it simple and the palette consistent. For example, if you have used blue to represent gross sales on one visual, don’t use green on another. Relating back to knowing your audience, be cognizant of any stakeholders who may be color blind. There’s also no need to reinvent the wheel, RAG ratings still work very effectively and are universally known. ### 9\. Use the space available to tell an effective story Don’t add an extra visual just because you can, rather enlarge the key visuals which give the user the main results they need. It can also be important to use different perspectives to draw attention to the most important visuals, i.e. the bigger the point, the bigger the visual. --- ## Learn from more data visualization experts inside our playbook Tired of presenting financial data that falls flat? Frustrated that your insights are lost in a sea of numbers and charts? Worry no more! We've created the ultimate [playbook](https://www.financealliance.io/storytelling-with-data-visualization/) to help you transform your financial data into captivating, persuasive stories. Discover the essential components of a powerful data narrative and learn how to weave them together to create a story that resonates with your audience. ### **What's Inside?** ✅ A step-by-step guide to crafting compelling data stories ✅ Financial data preparation and cleaning tips ✅ Data visualization expert tips on selecting the right graphs and charts ✅ Best practices for engaging presentations that inspire action ✅ How to build a persuasive argument with financial data ### 5 supply chain risk mitigation strategies to dodge disaster URL: https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/ Last updated: 2025-04-10T07:58:39.000Z Supply chain hiccups can quickly cascade into financial tremors that shake the core of your enterprise. In other words, if your supply chain goes belly up, it can spell disaster for the entire company. As a Chief Financial Officer (CFO), you’re tasked not just with navigating these choppy supply chain waters, but also with fortifying the business against any potential storm. So, how can you **mitigate supply chain risks** as effectively as possible? Find out in this article, where we explore five key supply chain risk mitigation strategies to help you steer your company toward financial stability and resilience. Learn how to: - [Spot pesty risks in your supply chain *before* they become a problem](https://www.financealliance.io/p/97317efc-e8eb-48fd-a024-ffc2dd591946/#strategy-1-risk-identification-and-assessment) - [Cast a wider safety net by diversifying your supply chain](https://www.financealliance.io/p/97317efc-e8eb-48fd-a024-ffc2dd591946/#strategy-2-supplier-diversification) - [Gain more visibility by leveraging robust supply chain technologies](https://www.financealliance.io/p/97317efc-e8eb-48fd-a024-ffc2dd591946/#strategy-3-implementing-robust-supply-chain-technologies) - [Create contracts and compliance procedures](https://www.financealliance.io/p/97317efc-e8eb-48fd-a024-ffc2dd591946/#strategy-4-establishing-strong-contracts-and-compliance-procedures) - [Build a resilient supply chain](https://www.financealliance.io/p/97317efc-e8eb-48fd-a024-ffc2dd591946/#strategy-5-building-a-resilient-supply-chain) But before we get into the supply chain risk mitigation strategies, let’s touch base on what types of risks to look out for.👇 ## **What are the types of risk in supply chain management?** There are several types of risks in supply chain management you could face, including: ![Types of supply chain risks](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/supply-chain-risk-mitigation-strategies-.jpeg) - **Supplier bankruptcy or financial instability** leading to failure in delivering goods or services. - Disruptions due to **geopolitical instability**, such as trade restrictions or wars. - **Natural disasters** or severe weather conditions affecting production or transportation. - [**Cybersecurity**](https://www.financealliance.io/cfo-cybersecurity/) **threats** leading to data breaches or disruptions in digital operations. - **Changes in regulations** that can impact the production, import, or export of goods. - **Poor quality control** resulting in defective products that need to be recalled. - **Labor disputes** or strikes causing delays in production or shipping. - **Fluctuations** in **currency exchange rates** impacting costs. - Significant changes in **market demand** leading to overstock or shortage. - **Failure of IT infrastructure** disrupting digital processes and communication. None of these situations are ideal. But sometimes, no matter how well you prepare, you'll suddenly be up against one (or more) of these supply chain risks. Thankfully, you won’t have to struggle for long as we’ve comprised some useful supply chain risk mitigation strategies. --- [Crisis Management Plan vs Business Continuity Plan | Finance AllianceBelieve it or not, a crisis management plan is not the same as a business continuity plan. The two are similar in many ways, sure, but they have key differences that set them apart.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Crisis-management-plan-vs-business-continuity-plan.jpg)](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) --- ## **5 supply chain risk mitigation strategies** [Gartner](https://www.gartner.com/en/supply-chain/insights/supply-chain-risk-management?%5Fits=JTdCJTIydmlkJTIyJTNBJTIyNzIyMDJhMGMtZjE2YS00ZTFhLTlkNTItMTc4MTZmYjczMjNlJTIyJTJDJTIyc3RhdGUlMjIlM0ElMjJybHR%2BMTY4NjgyNzI2Mn5sYW5kfjJfMTY0NjVfc2VvXzlhY2IwMjk3ZDJmODkwNTZhOGEyMTc3ODg3MmZkOGM0JTIyJTJDJTIyc2l0ZUlkJTIyJTNBNDAxMzElN0Q%3D) reports that **89%** of companies experienced a supplier risk event in the past five years. So, how can you help mitigate these risks? Here are five supply chain risk mitigation strategies to consider: ## Strategy 1: Risk identification and assessment According to [Symantec](https://symantec-enterprise-blogs.security.com/blogs/threat-intelligence/threat-landscape-2021), supply chain attacks increased by 100% year-over-year in 2021, which emphasizes the importance of identifying and analyzing risks as early in the process as possible. This step focuses on spotting any dangers that could throw your supply chain off track and then sizing up how serious and likely they are. Don’t worry, you won’t have to rely on a crystal ball to help you spot risks in your supply chain. However, there are a few things you can do to help identify potential risks. These methods could involve using tech platforms for data crunching, carrying out supplier checks, or even just having honest chats with your suppliers. It's about digging deep to see what *could* go wrong. From a supplier going bust to political upheavals, or even natural disasters – these are all potential risks that could interfere with your supply chain. Once you’ve identified the risks, it’s time to assess them. After all, it’s not enough to just spot the risks, you need to *understand* them. Ask relevant questions to help assess risks, such as: - How much damage could they do to your business? - What's their chance of happening? …and so on. Tools like risk charts and predictive analytics can help, giving you insights into which risks should be addressed first based on how impactful and likely they are. ### But where does the CFO come in? Your financial know-how and forward-thinking approach are crucial in understanding the money-related impacts of these risks. It’s up to you to make sure resources are spent wisely to handle and reduce the risks you've identified. In a nutshell, identifying and analyzing risks is like drawing up a good game plan. It’s the groundwork that paves the way for all the risk reduction work that follows. Developing a [business continuity plan](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) will also help to prepare for risks related to supply chains. ![Global supply chain risk mitigation strategies - image of a map with various types of transport](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/supply-chain-risk-mitigation-strategies-1-1.jpg) ## Strategy 2: Supplier diversification Seasoned CFOs know that diversifying suppliers is one of the most beneficial supply chain risk mitigation strategies. Think about it logically – the more suppliers you have spread out in different locations, the wider your safety net. If you're dependent on one supplier, you're playing with fire.🔥 ### What's good about this approach? Having different suppliers makes your supply chain tougher and more adaptable. If one supplier drops the ball or an entire region hits trouble, you've got backup options. Plus, a wide supplier base means better access to extra resources, tech, and skills. All these things can help drive innovation and keep you ahead of the game. ### How can you diversify your supplier base? It starts with widening your search for suppliers and looking at a mix of local, national, and global partners. Keep track of how well suppliers are doing and have a fresh list of backup suppliers at the ready. As a CFO, you're a key player in making supplier diversification work. You can help decide *where* to invest in building relationships with a range of suppliers. Your [financial insights](https://www.financealliance.io/infographic-financial-performance-metrics/) can also balance the cost of diversification against how much risk it cuts down. This involves looking at pricing, reliability, and quality to ensure diversifying doesn't hurt the bank or how well things run. 💡 ****Reminder:** Supplier diversification comes down to building a strong safety net. However, you’ve also got to make sure this safety net doesn't ****cost** too much, can stand the test of ****time**, and lines up with your company's long-term ****goals**. ## Strategy 3: Implementing robust supply chain technologies One of the most important supply chain risk mitigation strategiesis leveraging the right technology. A simple Google search turns up a list of tech solutions claiming to help solidify your supply chain. These range from basic tracking tools to advanced platforms that can streamline the entire process. But how can technology reduce risks related to the supply chain? It’s all about 'visibility'. Having a clear view across your supply chain puts you in a better position to handle risks head-on. You can spot and deal with disruptions as and when they happen, reducing their overall impact. Technology can also give you a heads-up about risks *before* they happen. Like most things in life (and business), bringing in new technologies comes with a price tag. You’ve got to consider the cost of buying, setting up the technology, and the cost of training staff, etc. 💡 Since you’re the CFO, you’re in control of deciding which technology to invest in. So, it’s time to weigh up the costs and benefits to see which technologies are worth the money. Once you’ve chosen the right tool, you’ll also have to manage its financial setup, making sure the transition is smooth and keeping an eye on the return on investment. If you use it right, technology can be a game-changer in managing your supply chain risks. It can not only help you handle risks better but also make operations more efficient. --- [Managing Complex Change Matrix for CFOs (Lippit-Knoster Model)Change is often necessary to help companies stay adaptable, competitive, and prepared for new challenges. One tool that has proven helpful in this area is the Lippitt-Knoster Model for Managing Complex Change Matrix, which provides a clear framework for handling change.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/managing-complex-change-model-2.jpg)](https://www.financealliance.io/managing-complex-change-matrix/) --- ## Strategy 4: Establishing strong contracts and compliance procedures There’s nothing like official contracts and compliance procedures to brighten a CFO’s day. Whilst both of these things may not be as shiny as high-tech solutions, they're still key parts of a good risk management strategy. Well-made contracts act as another safety net by setting out responsibilities, expectations, and steps to take if disruptions happen. They can be vital in avoiding arguments, making sure you get paid, or quickly switching to backup suppliers if needed. On the other hand, compliance procedures make sure everyone in your supply chain is playing fair. They can help with sticking to regulations, ethical sourcing, quality control, and more. Never underestimate the power of a strong compliance program. It can shield you from reputational risks, and legal fines, and help keep your supply chain on the straight and narrow. When it comes to compliance, your job is to understand the financial fallout of *not* sticking to the rules and to make sure resources are used effectively for compliance activities. You might also be involved in deciding metrics to measure how successful the compliance program is. Basically, having solid contracts and compliance procedures makes a rulebook for your supply chain and a game plan for when things go wrong. As a [CFO](https://www.financealliance.io/how-to-prepare-for-a-financial-crisis/), your know-how makes sure this rulebook is financially sound and safeguards your company's interests. ## Strategy 5: Building a resilient supply chain Resilience is your supply chain's knack for bouncing back from problems, keeping the business going even when the unexpected happens. In today's unpredictable world, resilience isn't just a nice-to-have - it's a *must-have*. So, how can you make your supply chain more resilient? There are various strategies to consider, like the risk assessment and supplier diversification we've discussed, as well as investing in flexible production capabilities. It could also involve nurturing strong relationships with suppliers for better teamwork and communication when trouble strikes. A resilient supply chain can bring several financial perks: - Minimized disruptions - Financial stability - Enhanced reputation - Competitive advantage - Customer satisfaction - Innovation and increased collaboration With your financial expertise, you're pivotal to boosting supply chain resilience. You're key in matching risk management strategies with financial goals, making sure the right investments are made to build resilience. Creating a resilient supply chain might need some initial investment and effort, but in the long run, it can pay off in terms of less risk and sustainable growth. --- [10 risks of mergers and acquisitions & how to mitigate themIn this article, we explore the top 10 risks of acquiring a company and how to mitigate them.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/risks-of-M-A.jpg)](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) --- ## **Other global supply chain risk management strategies** There are more supply chain [risk management](https://www.financealliance.io/value-creation-plan/) strategies to consider, so we’ve included some extras below: ### **Building strong relationships with suppliers** Nurturing solid relationships with suppliers can serve as a strong pillar in your risk mitigation plan. Close partnerships increase reliability and transparency since suppliers may be more willing to share potential risk information early with people they trust. Working collaboratively with suppliers is a key focus for [**53%**](https://www.wtwco.com/en-gb/insights/2023/02/2023-global-supply-chain-risk-report)[ of senior decision-makers](https://www.wtwco.com/en-gb/insights/2023/02/2023-global-supply-chain-risk-report), which proves just how vital collaboration is to increase resilience. In times of shortage or disruptions, you may experience preferential treatment or faster recovery times thanks to the strong relationship you’ve built with the supplier in question. Think of these relationships as strategic investments for maintaining long-term supply chain stability from a financial standpoint. ### **Inventory management** Managing your inventory effectively is another vital risk mitigation strategy in supply chain management. This involves maintaining a balanced inventory – not too high to escalate holding costs, and not too low to risk stockouts. Techniques like just-in-time inventory systems can be useful in managing inventory risks. As a CFO, you can play a key role in determining optimal inventory levels and assessing the financial implications of inventory decisions. ### **Risk transfer** Transferring risk, through mechanisms such as insurance or contractual agreements, can be a savvy move. It allows you to shift some of the work that goes into mitigating risk to other parties, creating an extra layer of protection for your company. Understanding the various risk transfer options and their cost-effectiveness is a crucial part of any risk management toolkit. ### **Scenario planning** This strategy involves creating a set of forecasts that depict different future scenarios. This practice can help you understand potential risks better and plan responses proactively. As the leader of the finance team, your analytical and strategic planning skills can contribute immensely to developing and interpreting these [scenarios](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/). ### **Continuous monitoring and improvement** Remember, risk mitigation isn't a one-and-done task. It requires ongoing monitoring of the supply chain environment and regular updating of risk mitigation strategies based on new information. Embedding a culture of continuous improvement within the organization is key, emphasizing that managing risk is a journey, not a single destination. --- ### FAQs: Global supply chain risk management strategies How can we improve supply chain visibility? Improving supply chain visibility involves integrating technology like IoT devices, AI, and blockchain into your operations. This allows for real-time tracking and monitoring, which can aid in quick decision-making and risk mitigation. How can we quantify the financial impact of supply chain risks? Quantifying the financial impact of supply chain risks involves a combination of cost accounting, scenario modeling, and risk probability assessment. A detailed risk assessment plan should be in place to understand potential financial losses from different risk scenarios. How can we leverage technology for supply chain risk management? Technology plays a pivotal role in supply chain risk management. Tools like AI and predictive analytics can help in anticipating potential risks and disruptions. Blockchain can improve transparency and traceability, and IoT devices can offer real-time tracking and monitoring. What should be included in a robust contingency plan for supply chain risks? A robust contingency plan should detail alternative suppliers, backup storage and distribution facilities, emergency response procedures for natural disasters, and a crisis communication plan. Regular testing and updating of the plan is also crucial. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### AMA with Christian Martinez | June 5-16 URL: https://www.financealliance.io/ama-with-christian-martinez/ Last updated: 2023-06-09T10:26:02.000Z ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/FA_AMA_--1--1.png) We are delighted to announce that we have an AMA with one of our very own members [**Christian Martinez**](https://www.linkedin.com/in/christianmartinezthefinancialfox)**! 🚀** Christian is currently the Finance Manager at Kraft Heinz and here is some facts about him: 🔥 Launched The Financial Fox , a project to democratize machine learning and data analytics. 🔥 Organized workshops and networking events for Young Professionals in Brisbane around data analytics, finance and machine learning. 🔥 Named 30 under 30 in the Accounting and Finance industry in Australia in 2021 Christian will be answering questions from June 5 to June 16\. 🗓 To ask him a question all you will need to do is: - Join Finance Alliance Slack by [**clicking this link**](https://www.financealliance.io/community/) - Add yourself to the channel #ama-christian-martinez and ask away! We look forward to seeing all of your questions 👏 ### How to use ChatGPT with Python (finance guide) URL: https://www.financealliance.io/how-to-use-chatgpt-with-python/ Last updated: 2025-10-01T08:43:34.000Z If you want to explore the transformative potential of AI in finance, learning how to use ChatGPT with Python is a great place to start. This high-tech language model from OpenAI can greatly boost your performance and streamline processes like financial modeling and data analysis. Better yet, ChatGPT’s API (Application Programming Interface) can act as a coding mentor that's available around the clock. Even *without* deep Python knowledge, you can use ChatGPT to write Python code in a matter of seconds – and in this blog post, we’ll teach you how. **Topics covered:** - [ChatGPT vs. ChatGPT API](https://www.financealliance.io/p/5b7079f0-5792-42ea-985b-db2da30679e9/#chatgpt-vs-chatgpt-api-the-key-differences) - [Getting started with ChatGPT in Python and obtaining an OpenAI API Key](https://www.financealliance.io/p/5b7079f0-5792-42ea-985b-db2da30679e9/#getting-started-with-chatgpt-in-python) - [How to use ChatGPT in Python (installation)](https://www.financealliance.io/p/5b7079f0-5792-42ea-985b-db2da30679e9/#how-to-install-chatgpt-api-in-python) - [Exploring the capabilities of ChatGPT in Python](https://www.financealliance.io/p/5b7079f0-5792-42ea-985b-db2da30679e9/#exploring-the-capabilities-of-chatgpt-in-python) - [How to interact with ChatGPT programmatically ](https://www.financealliance.io/p/5b7079f0-5792-42ea-985b-db2da30679e9/#how-to-interact-with-chatgpt-programmatically-as-a-finance-pro) - [Financial use cases of ChatGPT](https://www.financealliance.io/p/5b7079f0-5792-42ea-985b-db2da30679e9/#financial-use-cases-of-chatgpt) - [Python ChatGPT use cases in finance ](https://www.financealliance.io/p/5b7079f0-5792-42ea-985b-db2da30679e9/#python-use-cases-for-finance-professionals) ## ChatGPT vs. ChatGPT API: The key differences ChatGPT and the ChatGPT API, while closely related, serve distinct functions. Both are developed by OpenAI. However, ChatGPT is the AI model that has been trained to chat, understand prompts, and generate human-like text responses. If you haven’t used it yet, you’ve definitely heard about it as its user base grew by an explosive [9,900% in the first 60 days of launch](https://nerdynav.com/chatgpt-statistics/). On the other hand, ChatGPT API allows developers to harness the power of ChatGPT in their own applications or services. Instead of having to manually input and output each interaction, you can automate and customize the process, integrating the AI's capabilities into a broader system. You can think of ChatGPT API as the bridge connecting this tool with other software. This distinction makes the ChatGPT API especially attractive for developers and other professionals who want to embed AI capabilities within their systems. For finance professionals who code, the ChatGPT API offers a particularly interesting opportunity. Not only can it function as an AI assistant in your financial work, but it can also serve as a coding mentor, helping you write your Python code, troubleshoot issues, and deepen your understanding of Python's vast capabilities. --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ## Getting started with ChatGPT in Python Don't worry if you're new to programming or Python - this is a simple guide to follow. For those of you who are seasoned Python users, you'll find this to be a breezy and straightforward process. ## How to get an OpenAI API Key To access the [ChatGPT](https://www.financealliance.io/chatgpt-for-excel/) API, you’ll need to get your hands on an **OpenAI API Key**. Here’s how to get one: 1\. First, you need to sign up on the [OpenAI website](https://auth0.openai.com/u/signup/identifier?state=hKFo2SBhcGR4QzlDakVtMmgwdmlUbkpxQkpmZUdGNnpBMGJhWaFur3VuaXZlcnNhbC1sb2dpbqN0aWTZIExTM21nR09VNVJma19EMnZGeWs2Y1EtUDNJOEFMVXZRo2NpZNkgRFJpdnNubTJNdTQyVDNLT3BxZHR3QjNOWXZpSFl6d0Q) and apply for an API key. To do this, select the ‘**Personal**’ tab. You’ll find it in the top-right section of the screen. ![How to get an OpenAI API Key - click 'personal' in the top right](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/ChatGPT-API-Key-1.png) 2\. In the dropdown list, select ‘**View API Keys**’ and you’ll be taken to the main API keys page. ![How to get an OpenAI API Key - click 'view API keys'](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/Python-ChatGPT-API-Key-2.png) 3\. Select ‘**Create new secret key**’ to generate your API key. Take note of it because you can’t view it a second time. ![How to get an OpenAI API Key - Select 'create new secret key'](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/ChatGPT-API-Key-3.png) ![Select 'create secret key'](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/ChatGPT-API-Key-4.png) Once your application is approved, you’ll receive your unique API Key. ## How to use ChatGPT in Python (installation) Once you have an API key, you’re all set to implement the ChatGPT API in Python. This allows for seamless interaction with the ChatGPT system without having to go back and forth to the platform's site to ask questions. By combining ChatGPT and Python, you can enable the querying and utilization of the system's features directly from your Python environment. The instructions below are based on the assumption you’ve got your API key: ### Step 1: Required Python libraries and tools To begin, you'll need to have Python installed on your computer. In addition to Python, you can use OpenAI's Python client library, which provides a simple interface to the ChatGPT API. ### Step 2: Installing and setting up OpenAI's Python client To install OpenAI's Python client, open your terminal (or command prompt, if you're on Windows) and type the following command: ![ChatGPT and Python: pip install openai](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/Python-ChatGPT-1.png) This command uses pip, Python's package installer, to download and install the OpenAI library. ### Step 3: Authenticating and making API requests Before you can start making API requests, you'll need to authenticate with the OpenAI API. To do this, you'll need your API key from OpenAI. Once you have your key, you can set it as an environment variable in your terminal like this: ![ChatGPT with Python: export openai API key](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/Python-ChatGPT-2.png) Alternatively, you can include it directly in your Python script like so: ![Python ChatGPT: import openai](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/Python-ChatGPT-3.png) *\[Note: Make sure to replace 'your-api-key' with your actual API key\].* Once you've set your API key, you're ready to start making API requests. Here's a simple example of what an API request might look like: ![Python ChatGPT request example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/Python-ChatGPT-4.png) In this example, the script instructs ChatGPT to act as a helpful assistant and asks it a question. The response is then printed to the console. --- [CFO cybersecurity: What’s the CFO’s role in cybersecurity?From crunching numbers to combating cyber threats, the role of the CFO has leaped into uncharted territory, making CFO cybersecurity one of the hottest topics in boardrooms across the globe.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CFO-cybersecurity-2.jpg)](https://www.financealliance.io/cfo-cybersecurity/) --- ## Exploring the capabilities of ChatGPT in Python Now that you’ve set up the ChatGPT API and made your first requests, it's time to delve deeper into the functionalities that this technology can offer, especially for finance professionals using Python. ### Understanding Prompts, Tokens, and Models When interacting with ChatGPT, you mainly communicate through prompts, which are essentially the input you provide to the model. For instance, if you ask the model to summarize a financial report, the report's text would be the prompt. ChatGPT interprets your prompts as a series of tokens. A token can be as short as one character or as long as one word (e.g., 'a', 'apple'). Both the prompt and the model's response count toward the total number of tokens used. The model you'll use in your interactions with ChatGPT refers to the specific version of the AI you're communicating with. ### Understanding responses: Temperature and Max Tokens Two important parameters significantly influence the outputs from ChatGPT and they are referred to as 'temperature' and 'max tokens'. The 'temperature' parameter controls the randomness of the model's responses. A high temperature (close to 1) will produce more random outputs, while a low temperature (closer to 0) makes the output more deterministic and focused. The 'max tokens' parameter controls the length of the generated response. It can be used to ensure responses don't get too lengthy. This is especially useful when analyzing financial documents in a hurry. ## Handling conversational contexts One of the exciting features of ChatGPT is its ability to handle conversational contexts. By using a series of messages instead of a single prompt, you can simulate a conversation with the model. Each message has a 'role' that can be 'system', 'user', or 'assistant', and 'content' which contains the text of the message from the role. The 'system' role is used to set the behavior of the 'assistant'. For instance, you can tell the model that "*You are an assistant that summarizes financial reports.*" Following this, the 'user' role can ask the assistant to perform tasks within that description, such as summarizing a quarterly earnings report. Utilizing this conversational approach, you can build dynamic and interactive financial tools. For instance, you can develop a financial chatbot that provides explanations of complex financial terms, answers questions about specific financial events, or offers insights on financial trends. --- [Managing Complex Change Matrix for CFOs (Lippit-Knoster Model)Change is often necessary to help companies stay adaptable, competitive, and prepared for new challenges. One tool that has proven helpful in this area is the Lippitt-Knoster Model for Managing Complex Change Matrix, which provides a clear framework for handling change.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/managing-complex-change-model-2.jpg)](https://www.financealliance.io/managing-complex-change-matrix/) --- ## How to interact with ChatGPT programmatically Armed with the foundational knowledge of how ChatGPT operates and its potential capabilities, you’re now ready to level up and learn how to interact with ChatGPT programmatically. This ability to converse with the AI on your terms is what really unlocks its power, especially in the realm of finance. So, let's dive in. ### Managing sessions: The concept of chat models Chat models are a powerful feature of the ChatGPT API that allows for extended conversations. Each conversation is a session, and messages within a session are processed in the order they're received. This allows for the creation of back-and-forth dialogue, a crucial aspect of creating interactive financial applications. ### Crafting system messages System messages are typically used at the beginning of a conversation to gently instruct the assistant about its role. While not strictly required, they can help set the tone and behavior of the assistant. For example, you might start a conversation with: ![ChatGPT API Python example 1](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/_ChatGPT-API-Python-example-1.jpg) This message tells the assistant to gear its responses toward financial analysis and stock predictions. ### Sending user messages User messages are where you interact with the assistant. It's as simple as dictating the role as 'user' and providing your query or instruction in the content. For example, following the previous system message, a user message might look like this: ![ChatGPT API Python example 2](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/_ChatGPT-API-Python-example-2.jpg) This will prompt the assistant to generate a response fitting the financial analysis it was primed for in the system message. ### Controlling chat outputs: Setting Tokens and Temperature To control the length and randomness of the AI's responses, you can set the 'max tokens' and 'temperature' parameters in your API call. For example, to limit the response to 100 tokens and make it more deterministic, you could modify your API call like so: ![ChatGPT API Python example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/ChatGPT-Python-5.png) These features allow for a much more controlled and customizable interaction with the AI, allowing you to program your financial applications with precision that suits your requirements. ## Financial use cases of ChatGPT As we start to understand the mechanics of ChatGPT, the wide-ranging implications for its application in the finance industry become clear. By combining the natural language understanding of ChatGPT with Python's powerful data-handling capabilities, we can create some truly transformative financial solutions. Let's explore some of these potential use cases: ### Creating conversational financial advisors ChatGPT's ability to maintain context and respond to prompts makes it a great candidate for creating conversational financial advisors. These advisors can help answer customer queries on various financial products, offer personalized advice based on user inputs, or simply help users navigate the complexities of financial markets in a conversational, interactive manner. In this use case, the ChatGPT model could simulate a financial advisor, providing users with responses to financial queries: > **Prompt**: As a financial advisor, what would you suggest I invest in with a budget of $10,000? ![ChatGPT API Python example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/ChatGPT-Python-6.png) ### Natural language processing for financial statements With the power of ChatGPT, extracting valuable information from financial documents like earnings reports or cash flow statements becomes a more approachable task. You can task it to extract key financial metrics, read footnotes for any red flags, or simply transform these often dense, difficult-to-read documents into a more user-friendly format. For processing financial statements, you might use ChatGPT to extract relevant information or translate jargon into plain English: > **Prompt:** Translate the following financial statement into plain English: 'The company's EBITDA increased by 10% due to aggressive cost-cutting measures and increased market share. ![Chatgpt + API](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/Python-and-ChatGPT-7.png) ### Generating summaries for complex financial reports Finance professionals often must go through long and complex financial reports. ChatGPT can be used to generate concise summaries of these reports, saving professionals valuable time. The model could be used to create a summary of a complex financial report, for example: > **Prompt:** Generate a concise summary of the following financial report: '... (report text) ...' ![Chatgpt + API - response example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/ChatGPT-and-Python-8.png) ### Stock market predictions and trend analysis While no model can predict the stock market with absolute certainty, ChatGPT can be used as a tool to analyze market trends and sentiments. It can parse news articles, tweets, or other forms of public sentiment to give a broader picture of market sentiment around specific stocks, sectors, or the overall market. It can be used to generate analysis or discuss possible scenarios based on historical trends: > **Prompt:** Discuss the possible trends for the tech sector in the stock market based on historical data. ![Chat gpt open api](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/Python-ChatGPT-API-9.png) ## Python use cases for finance professionals Here are some specific ChatGPT API Python examples (in finance): ### Financial reporting automation Python's ability to extract, manipulate, and analyze data makes it a perfect tool for automating financial reports. It can fetch data from various sources, perform necessary computations, and generate comprehensive reports. Combining this with ChatGPT, you could even automate the generation of written analysis to accompany your reports. ### Automate spreadsheets Python libraries like openpyxl or pandas allow for extensive manipulation and automation of spreadsheets, a staple in any finance professional's toolkit. Whether it's cleaning data, performing calculations, or creating new spreadsheets, Python can handle it. You can also leverage ChatGPT to interpret complex spreadsheet data and provide summaries or insights. ### Financial analysis Python's powerful data analysis libraries, like NumPy and pandas, can perform complex financial analysis tasks, from simple statistical analysis to more complex time-series analysis. ChatGPT can then be used to interpret and explain the results of these analyses in clear, natural language. ### File management Python can automate file management tasks like organizing documents, renaming files, and archiving old data. This can be a significant time saver for finance professionals managing large numbers of documents. ### Data cleaning and validation Python can be used to validate the integrity and accuracy of financial data. It can check for missing data, outliers, or inconsistencies in datasets, which is crucial for accurate financial analysis and reporting. Thanks to the combined pairing of ChatGPT API and Python, [data cleaning](https://www.financealliance.io/data-cleaning-techniques/) is made simple. ### Data visualization Libraries like Matplotlib and Seaborn make Python a powerful tool for [data visualization](https://www.financealliance.io/8-key-principles-of-data-visualization-in-finance/). You can create anything from simple bar charts to more complex financial visualizations. ChatGPT can be used to automatically generate descriptions or analyses of these visualizations. ### Create PowerPoint presentations Python has libraries like python-pptx that allow for the creation and editing of PowerPoint files. This can be used to generate presentations summarizing financial results, investment strategies, or market research. Combined with ChatGPT, you can automate the creation of presentation scripts or speaker notes. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ## Python Libraries for finance Before we dive into specific libraries, let's understand what we mean by "Python libraries." A Python library is a reusable chunk of code that you may want to include in your programs or projects to avoid creating from scratch. These libraries provide pre-written functionality that helps to execute complex tasks quickly and reduce the amount of code you need to write. Here are some of the essential Python libraries that finance professionals might find particularly useful: **pandas** pandas is a fast, powerful, and flexible open-source data analysis and manipulation library for Python. It is perfect for handling financial data, providing data structures and functions needed to manipulate numerical tables and time-series data. **NumPy** NumPy is a library for the Python programming language, adds support for large, multi-dimensional arrays and matrices, along with a large collection of high-level mathematical functions to operate on these arrays. **Matplotlib** Matplotlib is a plotting library for Python and its numerical mathematics extension NumPy. It provides an object-oriented API for embedding plots into applications. **SciPy** SciPy is a free and open-source Python library used for scientific computing and technical computing. It contains modules for optimization, linear algebra, integration, interpolation, special functions, FFT, signal and image processing, ODE solvers, and more. **python-pptx** python-pptx is a Python library for creating and updating PowerPoint (.pptx) files. This can be particularly useful for finance professionals who often need to present their findings or analysis in the form of presentations. With python-pptx, you can create slides, add text, images, tables, graphs, and other shapes, and even manipulate the layout and design of the slides. **openpyxl** openpyxl is a Python library for reading and writing Excel 2010 xlsx/xlsm/xltx/xltm files. It is a comprehensive tool that lets you generate new Excel files, load existing ones, and access their data for further manipulation. It's particularly useful in finance for automating data extraction, transformation, and loading processes, generating reports, and performing complex calculations. ## 3 Tips for increased accuracy with ChatGPT Python When it comes to interacting with ChatGPT, one of the most important aspects is crafting effective prompts. The better your prompts, the more accurate and useful the model's responses will be. This is particularly crucial for finance professionals like [CFOs](https://www.financealliance.io/top-10-cfo-skills/), financial analysts, or investment advisors, whose decision-making often hinges on accurate and precise information. So, here are a few simple tips to help improve the accuracy of ChatGPT’s outputs: ### 1\. Be clear and specific One of the key things to remember when creating prompts is to be as clear and specific as possible. Ambiguity or vagueness can lead to responses that don't quite match what you were looking for. For example, instead of asking: > *Tell me about Tesla’s performance.* A more specific question could be: > *Can you provide a summary of Tesla's financial performance in the second quarter of 2023?* By being specific, you give ChatGPT a better chance of providing a response that meets your needs. ### 2\. Use the right tone The tone of your prompt can also influence the model's response. For example, if you're looking for a detailed, professional-level analysis, you might want to phrase your prompt more formally. On the other hand, if you're looking for a simplified explanation for beginners, you might want to make that clear in your prompt. For example: **Formal, professional tone:** > *Provide a detailed analysis of the current bond yield curve and its implications for our investment strategy.* **Simplified, beginner-friendly tone:** > *Could you explain in simple terms what a bond yield curve is and why it matters for our investments?* ### 3\. Experiment and iterate Finally, one of the best ways to get better at writing prompts is to experiment and iterate. Try different phrasings and tones, and see which ones get you the results you want. If the model's response isn't what you were hoping for, try tweaking your prompt and sending it again. To illustrate this, let's imagine a CFO is interested in an AI-generated brief about the impact of a recent Federal Reserve policy change on the company's bond portfolio. An effective prompt might look something like this: ![ Python Chatgpt code example](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/Python-code-example.jpg) Here’s how it might look in ChatGPT Python code: ![ChatGPT and Python code for analysis](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/Python-and-Chatgpt-api-10.png) The assistant, provided with a clear, specific task and context, will then generate a response that provides the requested analysis. --- ### FAQs: ChatGPT Python Can I use ChatGPT for Python? Absolutely! OpenAI provides a Python client library which you can use to interact with ChatGPT. You can install this library and use it to create a variety of interesting applications and solutions. What are the capabilities of ChatGPT Python? ChatGPT, when used with Python, can perform a wide range of tasks. It can generate human-like text, Python code, answer questions, create written content, translate languages, and much more. Can ChatGPT write Python scripts? Yes, ChatGPT can generate Python scripts based on given instructions or prompts. However, the quality and correctness of the scripts can vary and may require manual refinement. How to interact with ChatGPT programmatically? To interact with ChatGPT programmatically, you can use the OpenAI API. You send a list of messages to the API, and it returns a model-generated message as a response. Each message in your list should have a role (either "system", "user", or "assistant") and content (the text of the message). You'll typically start with a "system" message to set the behavior of the assistant, followed by alternating "user" and "assistant" messages. The OpenAI Python client provides an easy-to-use interface for this API. --- ### Further reading: Learn about Microsoft 365 Copilot and Excel with this article: [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) Read all about Microsoft Fabric and how you can use it with Data Factory, Synapse Real-Time Analytics, and more here: [How to use Microsoft Fabric for data analyticsWith Microsoft Fabric, you can bridge the gap between data and intelligence and integrate all your data seamlessly. These tools have opened up new possibilities, setting the stage for a new era in finance AI.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Microsoft-fabric-1.jpg)](https://www.financealliance.io/microsoft-fabric-for-data-analytics/) Learn how to use ChatGPT with Excel here: [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) Read all about how to use Copilot with Power BI here: [How to use Copilot in Power BIIn this article, we explore how you can leverage the power of Copilot in Power BI to help streamline your everyday processes within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/copilot-in-power-bi-2.jpg)](https://www.financealliance.io/copilot-in-power-bi/) And finally, discover how to use Google Bard with Excel and Google Sheets: [How to use Google Bard with Google Sheets and ExcelIn this article, we discuss the rise of Google Bard and how it can act as your personal assistant within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Bard.jpeg)](https://www.financealliance.io/google-bard-with-google-sheets-excel/) --- ### **Join the Finance Alliance Slack Community** Start networking with other CFOs and finance leaders inside our free [Slack community for finance professionals](https://www.financealliance.io/community/). Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. [Join our community today](https://www.financealliance.io/community/) ### 7 reasons why FP&A is becoming a popular career path URL: https://www.financealliance.io/7-reasons-why-fp-a-is-becoming-a-popular-career-path/ Last updated: 2025-04-07T10:09:25.000Z Financial planning and analysis (FP&A) is one of the most sought-after careers in the finance industry. There has been an exponential rise in the availability of data. And companies are relying on FP&A professionals to provide insights and analysis to drive strategic business decisions. [FP&A](https://www.financealliance.io/fp-a-exit-opportunities/) offers a unique blend of finance, strategy, and technology. This makes it an appealing option for those who are passionate about problem-solving and data analysis. Additionally, the role provides ample opportunities for career growth and advancement. Which makes it an attractive option for many professionals. This article will delve into seven reasons why FP&A has become such a popular career choice for finance professionals. And why it's worth considering as a future career path. ### 1\. Business strategy [FP&A professionals](https://www.financealliance.io/how-can-you-add-value-in-your-organization-as-a-fp-a-professional/) play a key role in a company's overall business strategy by providing financial analysis and insights to the company's management. ### 2\. Working with senior leadership FP&A professionals often work closely with senior leadership, including the CEO and CFO, which can provide valuable exposure and mentorship opportunities. ### 3\. Problem-solving They're often called upon to identify and solve complex problems related to financial performance and business strategy. --- [9 common myths about FP&A roles | Asif MasaniDespite the importance of FP&A, there are many myths and misconceptions about FP&A that can lead to misunderstandings about the work that FP&A professionals do.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceAsif Masani![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/fp-A-myths.jpg)](https://www.financealliance.io/9-common-myths-about-fp-a-roles/) --- ### 4\. Collaboration FP&A teams often work closely with other teams across the organization, including sales, marketing, and operations, to achieve common goals. ### 5\. Communication skills People who work in FP&A need strong communication [skills](https://www.financealliance.io/top-10-fp-a-skills-to-master/) in order to effectively present financial analysis and recommendations to various stakeholders. Hence, they become excellent communicators. ### 6\. Global opportunities FP&A roles often provide the opportunity to work on different projects around the world. This can be a great way to learn and grow. ### 7\. Career advancement and personal satisfaction FP&A roles often provide opportunities for advancement within a company. As well as the opportunity to learn about various aspects of the business. Many people find great satisfaction in helping to drive the financial success of a company and contribute to its long-term growth. --- [The ultimate data cleaning checklist for financeIn this blog, we get into the nuts and bolts of data cleaning techniques. We’ll also provide practical data cleaning steps to help guide you through the process.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Data-cleaning-checklist-2.jpg)](https://www.financealliance.io/data-cleaning-techniques/) --- In conclusion, there are several compelling reasons why many people are drawn to a career in FP&A. It offers a unique combination of financial expertise, analytical skills, and strategic thinking. This appeals to individuals who are driven to solve complex business problems. Plus, the demand for FP&A professionals continues to grow. That provides ample opportunities for career growth and advancement. Furthermore, FP&A offers a challenging and rewarding work environment. This allows professionals to make a meaningful impact on the success of an organization. With all these benefits, it's no wonder why FP&A is such a popular career choice among finance and business professionals! --- *This article was originally published at [www.fpnaprofessionals.com](https://www.fpnaprofessionals.com/posts/7-reasons-why-fpna-is-becoming-a-popular-career-path)* ### Join the Finance Alliance Community Sign up to our free [Finance Alliance Slack community](https://www.financealliance.io/community/) and start networking with other FP&A professionals, CFOs and finance leaders. Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. So, what are you waiting for? [Join our Slack community](https://www.financealliance.io/community/) ### 8 key principles of data visualization in finance URL: https://www.financealliance.io/8-key-principles-of-data-visualization-in-finance/ Last updated: 2025-11-04T10:18:32.000Z If you want to extract meaningful insights from data, understanding the key principles of financial data visualization is crucial. In this article, we'll delve into these principles, revealing how they're reshaping the finance industry. We'll also discuss data storytelling in finance and offer some best practice tips from the experts. **Table of contents:** - [What is data visualization?](https://www.financealliance.io/p/81859660-83e1-479f-a935-74866ba4f5e3/#what-is-data-visualization) - [What is data storytelling?](https://www.financealliance.io/p/81859660-83e1-479f-a935-74866ba4f5e3/#what-is-data-storytelling) - [Data storytelling vs data visualization](https://www.financealliance.io/p/81859660-83e1-479f-a935-74866ba4f5e3/#data-storytelling-vs-data-visualization-what-are-the-main-differences) - [Why should you care about data storytelling?](https://www.financealliance.io/p/81859660-83e1-479f-a935-74866ba4f5e3/#why-should-you-care-about-data-storytelling) - [Key principles of data visualization in finance](https://www.financealliance.io/p/81859660-83e1-479f-a935-74866ba4f5e3/#key-principles-of-data-visualization-in-finance) ## **What is data visualization?** Data visualization is a visual display of information or data. Rather than staring at spreadsheets or numbers, you can use colorful charts, graphs, and other visuals to help make sense of complex data. The goal of data visualization is to make the information more accessible, understandable, and interesting. It helps you see patterns and trends that might not be immediately apparent when you’re looking at rows and columns of numbers. With data visualization, you can quickly identify what’s working, what’s not, and where there might be room for improvement. Effective data visualization requires careful consideration of the financial data presented, the target audience, and the desired outcomes. ## **What is data storytelling?** Data storytelling is the art of transforming raw, numerical data into visually compelling narratives that captivate your audience. It combines the power of data analysis with the impact of storytelling to present financial information in a way that’s clear, engaging, and actionable. By using a variety of visualization tools – such as bar charts, scatter plots, timelines, graphs, heat maps, and more – you can paint a vivid picture of your data, making it easier for non-finance professionals to grasp and act on your insights. --- [The ultimate data cleaning checklist for financeIn this blog, we get into the nuts and bolts of data cleaning techniques. We’ll also provide practical data cleaning steps to help guide you through the process.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Data-cleaning-checklist-2.jpg)](https://www.financealliance.io/data-cleaning-techniques/) --- > *“It’s predicted that around 120 zettabytes (ZB) of data will be produced in 2023; in 2010, it was 2ZB! Businesses have more data than ever available to them but there is no point in producing and storing it if it is not used to gain insights and drive decisions. That’s where Data Visualisation comes into play. It is the art of bringing together large, sometimes disparate datasets and presenting them in a digestible form.* > *“If done right, it can be a perfect balance of quantitative and qualitative analysis, i.e. giving key results and KPIs but with a visual representation of the reasons driving these outcomes. It helps with absorbing information about data quickly.* > *"As data volume inevitably increases, visualization manages influxes of new information and makes it easy to find trends, understand requirements, and see correlations between business conditions that could otherwise go unnoticed.* > *“Among its many benefits, it can give leaders the ability to manage by exception, dashboards, and visuals can direct them to areas that most need their time and resources e.g. highlighting risk and possible mitigation.”* \- [**Liam Boyle**](https://www.linkedin.com/in/liam-boyle/)**, Data Analyst at Future Beauty Labs** ## **Data storytelling vs data visualization: What are the main differences?** ### **Data visualization** Data visualization for financial data involves presenting information in a pictorial or graphical format such as charts, graphs, and maps, so that decision-makers can see patterns, trends, and insights more easily. **Use in finance:** Often used in financial analysis for pattern recognition, spotting market trends, risk management, and investment decision-making. Dashboards with real-time KPIs and heat maps of asset performance are examples of data visualization in finance. ### Pros: - Simplifies complex datasets. - Quick and intuitive understanding of data. - Supports decision-making processes. ### Cons: - Lacks context and narrative - may not fully explain 'why' and 'how'. - Not always effective for detailed analysis or complex datasets. ### **Data storytelling** **Definition:** [Data storytelling](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) involves combining data, visuals, and narrative to convey meaningful and impactful insights from data. It not only presents data but also provides a story to give context, making the data more relatable and understandable. **Use in finance:** Can be used in financial presentations to shareholders or management, explaining complex fiscal scenarios, narrating the financial health of a company, or communicating strategies for growth or cost-cutting. ### Pros: - Enhances audience engagement by providing context and narrative. - Explains complex ideas in a digestible way. - Can guide the audience to specific conclusions or actions. ### Cons: - More time-consuming to create. - Can introduce bias based on the narrative chosen. --- [How to use data visualization storytelling to transform FP&AWant to learn how to tell compelling stories with data? Discover techniques to improve your data visualization storytelling skills right here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/data-visualization-storytelling-2.jpg)](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) --- ## **Why should you care about data storytelling?** In the fast-paced world of finance, it’s essential to communicate complex data effectively and efficiently. But why should you, as a finance expert, care about telling stories with data? Here are five key reasons: ![Data visualization principles - 5 reasons why finance pros should care about data visualization](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/06/data-visualization-principles.png)  --- ## **Key principles of data visualization in finance** We asked [Soufyan Hamid](https://www.linkedin.com/in/soufyanhamid/), Finance Presentations Coach at SouFBP, to share some of the key data storytelling and visualization principles in finance, and here’s what he had to say: The question you have to ask yourself is whether data visualization is necessary. Many times, explaining the issue is sufficient. But most of the time in finance, they’ll be needed and for that, the key principles are: ### 1\. Simplicity If a chart is more complex than a table, it’s not doing the job of giving the message and supporting your speech. ### 2\. Accuracy When I say accuracy, I am not saying that it must show all the details but it must not mislead the audience. Many times, we see charts where we play with the axis and give the impression that a bar is far longer than another but it’s not the case. ### 3\. Tailored In the age of business intelligence (BI) and dashboard solutions, efficiency is taking the lead. But the thing is when used in a presentation or a report, you have to tailor the colors, the labels, and the explanations to support your point. If you give a standard chart, you don’t do the job of analyzing it for the reader. --- Continuing from Soufyan’s insights, let's delve into a few more essential principles of financial data visualization: ### 4\. Consistency Consistency in the use of colors, symbols, and units helps in interpreting visualizations easily. Stick to a particular color code or symbols throughout your data to avoid any confusion. ### 5\. Context Always provide context to your visual data. For instance, if you're showing revenue growth, include information about the market trends or competitor performance during the same period. This helps the audience understand the significance of the data. ### 6\. Interactivity With advanced data visualization tools, you can make your visuals interactive. This allows your audience to explore data at their own pace, particularly helpful when dealing with complex or extensive data sets. ### 7\. Balance Striking a balance between simplicity and detail is crucial. While you want your visual to be simple enough to understand, it should also carry sufficient details to convey the complete story. ### 8\. Data integrity Above all, ensure your visualizations maintain data integrity. Misrepresenting data can harm your credibility and mislead your audience. Always double-check your sources and ensure your visualizations accurately represent the underlying data. Remember, visualizing financial data is not merely about creating graphs or charts. It's about presenting data in a meaningful, understandable, and accurate way that supports your narrative and facilitates decision-making. Following these principles can enhance the effectiveness of your data visualization in finance. --- ### FAQs: Principles of data visualization Is data visualization always necessary in finance? Not always. Sometimes, a well-explained narrative can convey the point without visualization. However, for complex data or trends, data visualization can aid in better comprehension. How can I choose between data storytelling and data visualization? It depends on your goal and audience. Data storytelling is useful when you want to engage the audience with a compelling narrative, while data visualization is excellent for quick, intuitive understanding. Are there any specific tools I should use for financial data visualization? There are various tools available such as Tableau, PowerBI, and Excel. The choice depends on your specific requirements, the complexity of data, and your comfort with the tool. How can I ensure my visualizations are easily understood? Stick to simplicity and clarity. Use consistent colors and symbols, provide context, and avoid overloading your visuals with too much data. How can data visualization support decision-making in finance? By providing visual representations of complex data, visualizations can help identify patterns, trends, and insights that support strategic decision-making in finance. --- ## Download the Storytelling with Data Visualization Playbook Tired of presenting financial data that falls flat? Frustrated that your insights are lost in a sea of numbers and charts? Worry no more! We've created the ultimate [playbook](https://www.financealliance.io/storytelling-with-data-visualization/) to help you transform your financial data into captivating, persuasive stories. Discover the essential components of a powerful data narrative and learn how to weave them together to create a story that resonates with your audience. ### **What's Inside?** ✅ A step-by-step guide to crafting compelling data stories ✅ Financial data preparation and cleaning tips ✅ Expert tips on selecting the right graphs and charts ✅ Best practices for engaging presentations that inspire action ✅ How to build a persuasive argument with financial data [![Storytelling with Data Visualization playbook](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/FA_Storytelling_with_Data_Visualization_CTA_.png)](https://www.financealliance.io/storytelling-with-data-visualization/) ### 5 data cleaning techniques for high-impact financial analysis URL: https://www.financealliance.io/data-cleaning-techniques/ Last updated: 2025-04-08T17:36:19.000Z In finance, extracting actionable insights from data is paramount. But to do so, we must ensure our data is correct. This is where a process called data cleaning or data cleansing comes into play. In this blog, we get into the nuts and bolts of data cleaning techniques. We'll also provide practical data cleaning steps to help guide you through the process. **Table of contents:** - [What is data cleaning?](https://www.financealliance.io/p/404e3004-0133-4d25-9b26-0a80fe06831e/#what-is-data-cleaning) - [The importance of data cleaning](https://www.financealliance.io/p/404e3004-0133-4d25-9b26-0a80fe06831e/#why-is-data-cleaning-important) - [Why manually cleaning data is so difficult](https://www.financealliance.io/p/404e3004-0133-4d25-9b26-0a80fe06831e/#what-makes-manually-cleaning-data-challenging) - [Examples of data cleaning in finance](https://www.financealliance.io/p/404e3004-0133-4d25-9b26-0a80fe06831e/#data-cleaning-in-finance-examples) - [Data cleaning techniques and tips](https://www.financealliance.io/p/404e3004-0133-4d25-9b26-0a80fe06831e/#data-cleaning-techniques) ## What is data cleaning? Data cleaning is the process of identifying and correcting errors, inaccuracies, and inconsistencies in raw data. This is important because it involves removing duplicate entries, filling in missing data points, and standardizing data formats to ensure data is accurate and consistent. Financial data must be ‘clean’ to be used for analysis and [data visualization](https://www.financealliance.io/storytelling-with-data-visualization-playbook/). By cleaning the data, you can prevent errors and incorrect insights, which can be a costly and time-consuming mistakes further down the line. But what exactly is ‘clean data’? According to TechTarget, [characteristics of clean data](https://www.techtarget.com/searchdatamanagement/definition/data-scrubbing) include: - Accuracy - Completeness - Consistency - Integrity - Timeliness - Uniformity - Validity ## Why is data cleaning important? Data cleaning is super important, and here's why. First off, it's all about making sure your data is accurate. Think about it - if you're working with what's known as 'dirty data', the analysis can go haywire. This can lead to misleading results, misinformed decisions, and potential financial loss. Secondly, clean data makes the whole process of data handling and analysis run a whole lot smoother. Who wouldn't prefer working with a neat, orderly dataset over a chaotic one? It just makes everything (including data processing) more efficient. Finally, when your data is clean, your predictive models turn out to be much more reliable. These models are kind of like picky eaters - they perform best when you feed them good, clean data. So, with your data in tip-top shape, you'll be in a better position to forecast future trends and make smart, proactive decisions. --- [7 data management problems and solutionsData management plays a pivotal role in driving insightful decisions and ensuring the financial success of a company. But let’s face it – navigating this intricate landscape can feel like a battle, filled with data management challenges like inaccuracies, security breaches, and complex integrations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/markus-spiske-8OyKWQgBsKQ-unsplash-2.jpg)](https://www.financealliance.io/7-data-management-problems-and-solutions/) --- ## What makes manually cleaning data challenging? One of the main challenges of manually cleaning financial data is the sheer volume of information on hand. In today's world, [finance professionals manage massive datasets](https://www.financealliance.io/7-data-management-problems-and-solutions/), which can quickly become overwhelming. After all, making sure no errors are overlooked takes time, patience, and meticulous attention to detail. Secondly, data discrepancies can often be subtle and hard to detect. Identifying and correcting these can be a daunting task. Some examples include issues in the data, like differing data formats or misspelled words. Lastly, there's the risk of introducing new errors during the data cleaning process. For instance, while filling in missing data or removing duplicates, one might accidentally delete critical information or input incorrect data. ## Data cleaning in finance examples Examples of data cleaning in finance can vary but here are a few common scenarios: ### Duplicates in a transaction database Let's say you're pouring over a massive list of customer transactions. As you sift through, you start noticing some suspiciously identical entries - same customer, same date, same amount, etc. That's a classic example of duplicate data. In data cleaning, your first order of business is to seek out and remove these sneaky repeats. ### Inconsistent currency formats When working with a dataset from multiple countries, you'll often work with different currencies. One dataset can include figures in US dollars, Canadian dollars, euros, etc., and analyzing mixed data like this can be difficult. You'd need to convert all those different currencies into one standardized format. ### Consolidating financial statements Suppose a CFO is overseeing multiple business units, each with its own financial statements. In this case, data cleaning might involve aligning the data structure across all these units, ensuring the same account names and financial categories are used, so that a consolidated report can be prepared accurately. ### Handling different fiscal year ends If the CFO is managing companies or subsidiaries with different fiscal year-ends, they'll need to standardize the data for comparison or consolidation. Data cleaning in this scenario involves aligning data into a uniform fiscal period. ### Discrepancies in revenue recognition In some cases, different business units might recognize revenue differently. For instance, one on a cash basis and another on an accrual basis. Data cleaning is needed to standardize the revenue recognition method across all units for accurate reporting and analysis. --- [How to use data visualization storytelling to transform FP&AWant to learn how to tell compelling stories with data? Discover techniques to improve your data visualization storytelling skills right here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/data-visualization-storytelling-2.jpg)](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) --- ## Data cleaning techniques in finance There are a few commonly used data cleaning techniques to help ensure data is clean and free from mistakes. Here are a few: ### 1\. Remove duplicates Duplicated data entries are more common than you might think and tend to occur during data collection. This can lead to inconsistencies and errors in your [analysis and visualizations](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/). By removing duplicates, you can ensure your data is accurate and consistent. ![Data cleaning technique tip in Excel - remove duplicates](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-cleaning-in-excel.png) --- ### 2\. Fill in missing values Have you ever tried to solve a puzzle with missing pieces? It’s frustrating! The same goes for missing data in your dataset. Missing data can be a major problem when it comes to analysis. It can skew your results and make it difficult to draw accurate conclusions. By filling in missing values, you can ensure your analysis is based on complete and accurate data. ![Data cleaning technique tip in Excel - Fill down](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-cleaning-tip.png) --- ### 3\. Correct inaccuracies Inaccurate data can lead to incorrect insights and decisions. Taking time to correct errors ensures your data is reliable and trustworthy. ![Data cleaning technique tip in Excel - Find and replace](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-cleansing.png) --- ### 4\. Standardize data formats Standardizing data formats ensures your data is compatible and easy to work with. If your data formats are inconsistent, it can lead to more errors. ![Data cleaning technique tip in Excel - Text to columns](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Data-cleaning-technique.png) --- ### 5\. Remove irrelevant data Irrelevant data can clutter your dataset and make it difficult to draw meaningful insights. Removing unnecessary data lets you focus on the most important information. ![Data cleaning technique tip in Excel - Filter](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-cleaning-excel-tip.png) --- ### FAQs: Data cleaning What are the 3 objectives of data cleaning? The main objectives of data cleaning are to enhance data quality by removing errors and inconsistencies, to prepare the data for analysis and visualization and to ensure reliable and accurate decision making based on the data. What data should be cleaned? All data, regardless of its source, should be cleaned before analysis. This includes data from spreadsheets, databases, text files, and even data collected through forms and surveys. Is data cleansing a part of extraction? Yes, data cleansing can be part of the extraction process, often referred to as the ETL (Extract, Transform, Load) process. However, it is also a standalone process that needs to be performed continuously as new data is added. --- ## Download the Storytelling with Data Visualization Playbook Tired of presenting financial data that falls flat? Frustrated that your insights are lost in a sea of numbers and charts? Worry no more! We've created the ultimate [playbook](https://www.financealliance.io/storytelling-with-data-visualization/) to help you transform your financial data into captivating, persuasive stories. Discover the essential components of a powerful data narrative and learn how to weave them together to create a story that resonates with your audience. ### **What's Inside?** ✅ A step-by-step guide to crafting compelling data stories ✅ Financial data preparation and cleaning tips ✅ Expert tips on selecting the right graphs and charts ✅ Best practices for engaging presentations that inspire action ✅ How to build a persuasive argument with financial data [![Storytelling with Data Visualization playbook](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/FA_Storytelling_with_Data_Visualization_CTA_.png)](https://www.financealliance.io/storytelling-with-data-visualization/) ### Budgeting vs forecasting: Understanding 20 key differences URL: https://www.financealliance.io/budgeting-vs-forecasting-understanding-the-key-differences/ Last updated: 2026-02-02T11:41:42.000Z When it comes to guiding decision-making, allocating resources, and ensuring an organization's long-term financial stability. Budgeting and forecasting are two crucial [FP&A](https://www.financealliance.io/your-ultimate-guide-to-fp-a/) activities. Forecasting and budgeting are connected but separate activities with differing goals, methods, and results. **Topics covered:** - [What is budgeting?](https://www.financealliance.io/p/ef4bfb81-6809-4e6c-a73b-d0491f105f3d/#what-is-budgeting) - [What is forecasting?](https://www.financealliance.io/p/ef4bfb81-6809-4e6c-a73b-d0491f105f3d/#what-is-forecasting) - [Differences between budgeting and forecasting](https://www.financealliance.io/p/ef4bfb81-6809-4e6c-a73b-d0491f105f3d/#budgeting-vs-forecasting-understanding-the-key-differences) ## What is budgeting? [Budgeting](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/) is the process of planning and allocating resources for a specific period, such as a fiscal year. It involves setting revenue and expense targets, determining resource needs, and [managing cash flow](https://www.financealliance.io/3-cash-flow-forecasting-challenges/). A budget is a blueprint for how the company is expected to do business in the next financial year. It forms the basis of business operations in the year ahead. It dictates the decisions relating to: - Where to invest - What costs to cut - Where to allocate more resources - Where to focus specific efforts FP&A teams work with various other departments/business units/functions to prepare departmental budgets and consolidate them into one overall company budget. --- [10 risks of mergers and acquisitions & how to mitigate themIn this article, we explore the top 10 risks of acquiring a company and how to mitigate them.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/risks-of-M-A.jpg)](https://www.financealliance.io/risks-of-mergers-and-acquisitions/) --- ## What is forecasting? A forecast is an estimate of what the company will achieve if it keeps performing as it is. It shows you how far you'd be off budget if you kept going as is. FP&A teams create, update, and maintain financial models (in Excel or a forecasting tool). They maintain detailed forecasts of the company’s future operations. After the budgets are done. Every quarter, we reflect on what has actually happened versus the budget. Not everything goes as planned. This is where quarterly [forecasting ](https://www.financealliance.io/14-dos-and-donts-financial-forecast/)becomes important. It helps to quantify and manage the gap between the original budget and reality. According to the latest insights, a forecast is where the company is genuinely headed. --- [Top-Down vs. Bottom-Up Forecasting | Finance AllianceTop-down vs bottom-up forecasting: Which method should you use to create accurate sales forecasts? Find out in this article.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/FA-Infographics_Forecasting.jpg)](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) --- ## Budgeting vs forecasting : Understanding the key differences 1. **Purpose:** Budgeting is the process of creating a financial plan for a defined period of time, usually a fiscal year. [Forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) is the process of predicting future financial outcomes based on historical data and trends. 2. **Inputs:** Budgeting starts with setting financial goals and allocating resources to achieve them. Forecasting uses past financial data and market trends to make predictions. 3. **Time horizon:** Budgeting is typically a long-term planning tool that covers a fiscal year or more. Forecasting can be done for any period of time, from the next month, quarter, 1 year, 3 years. 4. **Precision:** Budgets are often detailed and precise, with specific revenue and expense targets. Forecasts are less precise, due to the uncertainty of future events. 5. **Flexibility:** Budgets are static and sometimes set in stone, making it difficult to change them during the year. [Rolling forecasts](https://www.financealliance.io/rolling-forecast-best-practices/), on the other hand, can be updated as new information becomes available. 6. **Level of detail:** Budgets are usually more detailed, covering all expenses and revenues. Forecasts are often high-level and less granular. 7. **Use:** Budgeting is used to guide financial decision-making and [measure performance](https://www.financealliance.io/infographic-financial-performance-metrics/) against goals. Forecasting is used to anticipate future events and adjust plans accordingly. 8. **Decision-making:** Budgeting is a key tool in the decision-making process, as it helps managers allocate resources and prioritize initiatives. Forecasting is used to inform and support decision-making, by providing a view of potential future outcomes. 9. **Role of management:** Budgeting often involves input and approval from upper management, while forecasting may be done by finance teams with individual departments. 10. **Accuracy:** Budgeting is based on well-researched assumptions and estimates, but may still be subject to significant deviations from actual results. Forecasting accuracy can be impacted by unpredictable events and market changes. 11. **Relevance:** Budgeting is important for companies that need to plan and manage their money, while forecasting is important for companies that want to know and prepare for future market conditions. 12. **Compliance:** Budgeting is sometimes tied to regulatory requirements and financial reporting standards, while forecasting is not necessarily subject to the same level of compliance. 13. **Complexity of financial models:** Financial modelling plays an important role in both Budeting and forecasting. However, in general budgeting may utilize less [complex financial models](https://www.financealliance.io/managing-complex-change-matrix/), while forecasting often relies on models and algorithms to predict future outcomes. 14. **Emphasis:** Budgeting places emphasis on controlling costs and managing resources, while forecasting focuses on anticipating future financial outcomes. 15. **Continuous process:** Budgeting is a process that is typically done annually or semi-annually. While forecasting is a continuous process that is updated as needed to reflect changes in market conditions. 16. **Real-time vs historical data:** Forecasting typically uses real-time data and market trends, while budgeting may use historical data and assumptions. 17. **Iterative process:** Both budgeting and forecasting are iterative processes.Budgeting may involve an iterative process, with multiple rounds of revisions and updates. While forecasting may involve a more dynamic and ongoing process. 18. **Basis of comparison:** Budgeting provides a basis for comparing actual performance against planned results. Forecasting provides a basis for evaluating potential risks and predicting future results. 19. **Dynamic vs static:** Forecasting is a process that changes over time, while budgeting is a process that is set for a certain period of time. 20. **Input from other departments:** Budgeting may involve lots of inputs from other departments, such as marketing and sales. While forecasting may involve fewer inputs and may be primarily done by [finance and data analytics](https://www.financealliance.io/microsoft-fabric-for-data-analysis/) teams. Budgeting and forecasting both serve different purposes. And are important tools for financial planning and decision-making. --- ## **Learn how to create budgets & forecasts to support strategic decision-making** Take your budgeting and forecasting skills to the next level by learning the practical techniques used today at leading companies from an experienced FP&A leader – Christian Wattig. Christian is an accomplished FP&A expert with over a decade of leadership experience in multinational corporations and fast-growing tech start-ups. With Christian Wattig as your coach, you’ll learn how to navigate the five phases of annual budgeting: Pre Kick-Off, Joint Planning, Consolidation, Iteration, and Final Alignment. You’ll also learn to create accurate forecasts that empower leaders to make better decisions. [Enrol today](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### CFO cybersecurity checklist: What's your role in managing cybersecurity? URL: https://www.financealliance.io/cfo-cybersecurity/ Last updated: 2025-10-10T08:22:21.000Z From crunching numbers to combating cyber threats, the role of the CFO has leaped into uncharted territory, making CFO cybersecurity one of the hottest topics in boardrooms across the globe. And it’s not a surprise considering for a whopping [83% of companies](https://www.ibm.com/reports/data-breach), it's not a question of *if* a data breach will happen, but *when*. So, what role does the CFO play in cybersecurity, if any? You’ll find out in this blog post, where we talk about why the CFO is vital in protecting the financial security of a business. Don't forget to grab your free CFO cybersecurity checklist.👇 **Topics covered:** - [The CFO's role in cybersecurity](https://www.financealliance.io/p/0023b2c3-bd47-4914-91e4-da735256a4c6/#the-role-of-the-cfo-in-cybersecurity) - [The current state of cybersecurity](https://www.financealliance.io/p/0023b2c3-bd47-4914-91e4-da735256a4c6/#the-current-state-of-cybersecurity) - [How CISOs and CFOs can work together](https://www.financealliance.io/p/0023b2c3-bd47-4914-91e4-da735256a4c6/#how-cisos-and-cfos-can-work-together) - [Types of data breach](https://www.financealliance.io/p/0023b2c3-bd47-4914-91e4-da735256a4c6/#types-of-data-breach) - [Advantages and disadvantages of cybersecurity](https://www.financealliance.io/p/0023b2c3-bd47-4914-91e4-da735256a4c6/#advantages-and-disadvantages-of-cybersecurity) - [How cybercriminals attack companies](https://www.financealliance.io/p/0023b2c3-bd47-4914-91e4-da735256a4c6/#how-cybercriminals-attack-companies) - [Your free CFO Cybersecurity Checklist](https://www.financealliance.io/p/0023b2c3-bd47-4914-91e4-da735256a4c6/#cfo-cybersecurity-checklist%F0%9F%91%87) ## The role of the CFO in cybersecurity Financial data is prime bait for cybercriminals and CFOs must be on their toes, keeping up with the latest IT security systems, understanding complex legal frameworks, and integrating new tech and data across the company. You see, CFOs aren't just about numbers and spreadsheets anymore. They're now the digital gatekeepers at the forefront of safeguarding a company’s financial data and digital assets. Apart from keeping the company financially healthy, CFO cybersecurity measures can also include sourcing the best digital defenders and making sure the company's virtual walls are impenetrable. Thankfully, CFOs don’t hold this responsibility alone. It’s a team effort and the CFO will often work alongside other colleagues to help ensure data is kept safe. This often includes roles like: - Chief Information Officer (CIO) - Chief Technology Officer (CTO) - Compliance and Risk Officers (CSRO) - General Counsels - Internal Audit teams - Chief Information Security Officer (CISO) - HR, and Operations Each one plays a role in this intricate game of cyber defense. --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ## The current state of cybersecurity The first thing you need to know about the existing state of the cybersecurity universe is the fact it’s evolved. Like chameleons, attackers have adapted to our defenses. In some cases, you’re not just dealing with a lone hacker, but well-funded and highly organized units. These cyber attackers aren't interested in a quick steal anymore. They're playing the long game and bypassing firewalls, antivirus software, and intrusion detection systems with ease. As you can imagine, losing confidential data can’t lead to anything good, resulting in issues such as steep drops in revenue, reputational damage, and regulatory impacts. With CEOs losing sleep and boards asking tough questions, the role of the CFO in cybersecurity has never been more important. A recent surge in high-profile cyber attacks has rocked major U.S. companies, leading to significant financial losses and shattered consumer confidence. The financial toll of these types of incidents is staggering, which is why managing cybersecurity is a core element of enterprise risk, often falling squarely in the CFO's domain. CFO cybersecurity goes beyond the company itself, extending to vendors, suppliers, and third-party partners, and even becoming a key factor in M&A deals. --- [What is big data security analytics?From network intrusions and malicious insider activity to data breaches and compliance violations, the risks to a company’s sensitive data are at an all-time high. So, how can you protect data from theft and other malicious threats?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/hacker-g63e41dc9d_1280-2.jpg)](https://www.financealliance.io/what-is-big-data-security-analytics/) --- ## How CISOs and CFOs can work together Protecting financial data is a shared mission that calls for the combined efforts of two key figures in a company: the CFO and the CISO (Chief Information Security Officer). This partnership isn't just beneficial, it's *crucial*. The CFO brings their deep understanding of financial data to the table, while the CISO has the technical expertise to protect this data from cyber threats. Together, they can identify the most critical data assets, determine potential vulnerabilities, and establish a strategy to safeguard these assets. Here are some tips to help you work with your CISO (and other team members) to improve cybersecurity measures: ### 1\. Open communication The CFO and the CISO must maintain a consistent dialogue to align their goals. This allows the CISO to gain a clear understanding of the financial risks and implications of data breaches, while the CFO learns about the current cybersecurity landscape and the technological measures available to protect data. ### 2\. Create a cybersecurity budget Next, they should work together to create a comprehensive cybersecurity budget. The CFO's understanding of financial constraints and the CISO's knowledge of necessary cybersecurity investments can result in a budget that balances cost and security. We recommend investing in [artificial intelligence](https://www.aiacceleratorinstitute.com/your-guide-to-artificial-intelligence/) or automated protection software, which according to [IBM](https://www.ibm.com/reports/data-breach), has a 74-day shorter breach lifecycle and saves an average of USD $3 million more than companies without one in place. ### 3\. Identify potential risks Both roles must manage cyber risks by identifying potential threats and vulnerabilities. By combining the CFO's risk management skills and the CISO's technical knowledge, they can develop a robust [risk management strategy](https://www.financealliance.io/value-creation-plan/). ### 4\. Build a company-wide culture of cybersecurity Lastly, the CFO and the CISO can also collaborate on establishing a company-wide culture of cybersecurity. The CFO can communicate the financial implications of cyber threats, while the CISO can offer training and resources to improve employees' cybersecurity practices. --- [How to use Google Bard with Google Sheets and ExcelIn this article, we discuss the rise of Google Bard and how it can act as your personal assistant within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Bard.jpeg)](https://www.financealliance.io/google-bard-with-google-sheets-excel/) --- ## Types of data breach Regarding CFO cybersecurity efforts, CFOs must be aware of the various types of cyberattacks that can put their company's financial data at risk. This includes being familiar with different data breach types and understanding the implications of each. ### Hacking and malware One of the most common types of data breaches is the hacking of systems to steal sensitive information, often through the use of malware. These attacks can result in unauthorized access to financial data, customer information, and proprietary assets. ### Phishing attacks Phishing attacks are another type of information security breach. Here, the attacker tricks employees into revealing sensitive information, like usernames and passwords, by masquerading as a trustworthy entity through emails or other forms of communication. It can be a really costly attack with the [FBI](https://www.ic3.gov/Media/Y2022/PSA220504) reporting business email compromise attacks have cost organizations a staggering $43 billion since 2016. ### Ransomware attacks Ransomware is a particularly malicious type of attack in cybersecurity. In these attacks, hackers encrypt the victim's data and demand a ransom to restore access. If the ransom isn't paid, the data may be permanently lost or even published online. ### Insider threats Insider threats also pose a significant risk. These types of breaches occur when someone within the organization, such as an employee or contractor, intentionally or unintentionally mishandles data or system access. ### Denial-of-service (DoS) attacks Finally, denial-of-service (DoS) attacks can be a real headache. Here, the attacker overwhelms the company's network or servers with traffic, causing them to slow down or crash, thereby denying service to legitimate users. --- [How to use Copilot in Power BIIn this article, we explore how you can leverage the power of Copilot in Power BI to help streamline your everyday processes within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/copilot-in-power-bi-2.jpg)](https://www.financealliance.io/copilot-in-power-bi/) --- ## Advantages and disadvantages of cybersecurity The CFO cybersecurity role is about strategic thinking, risk management, and weighing the benefits against the costs. So, here are some of the main strengths and weaknesses of cyber security for you to consider: ### Advantages of cybersecurity - **Protection from cyber threats:** Cybersecurity measures help protect networks, systems, and data from various cyber threats such as malware, ransomware, phishing, and more. - **Prevents unauthorized access:** Online security measures help prevent unauthorized access to sensitive information, safeguarding intellectual property, personal data, and financial information. - **Maintains brand reputation:** By preventing data breaches, cybersecurity helps maintain a company's reputation, which could otherwise be severely damaged by a security incident. - **Compliance with regulations:** Many industries have regulations requiring certain levels of cybersecurity, such as GDPR for personal data protection. Implementing robust cybersecurity helps organizations comply with these rules. ### Disadvantages of cybersecurity - **High costs:** Implementing effective cybersecurity measures can be expensive. This includes the cost of software, hardware, and hiring or training staff. - **Complexity:** Cybersecurity can be complex to manage, especially as threats continue to evolve. This requires continuous learning and adaptation. - **Potential for false positives:** Security systems can sometimes flag harmless activities as potential threats, leading to unnecessary action or investigation. - **User inconvenience:** Some security measures, such as multi-factor authentication, can lead to inconvenience for users, potentially impacting productivity. --- [How to use Microsoft Fabric for data analyticsWith Microsoft Fabric, you can bridge the gap between data and intelligence and integrate all your data seamlessly. These tools have opened up new possibilities, setting the stage for a new era in finance AI.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Microsoft-fabric-1.jpg)](https://www.financealliance.io/microsoft-fabric-for-data-analytics/) --- ## How cybercriminals attack companies As the CFO, it’s vital to do your homework and learn how cybercriminals plan and execute their attacks. In the first act of their plot, they carry out research and look for any weaknesses they can exploit - this could be a less-secure third-party vendor, outdated software, or an employee who's a little too click-happy on emails. Once they've identified their entry point, they're ready to move on to the next phase. Now, here’s where the attack happens, and it usually happens fairly quickly. For example, the attack could be a type of malware infiltration, where the attacker sneakily installs malicious software onto the company's systems. Or perhaps it's a phishing expedition, where they send emails pretending to be a trusted source and trick employees into handing over sensitive data. And let's not forget about ransomware, where they hold a company's data hostage until a ransom is paid. These are just a few examples, there are many others. The key takeaway for a CFO? Stay alert, stay informed, and invest in strong cybersecurity defenses. The quicker you respond, the better. In fact, the average savings of containing a [data breach](https://www.ibm.com/reports/data-breach) in 200 days or less is **$1.12M**. The battle against cybercriminals is ongoing, but with the right strategies, you can keep your company's financial data safe and secure. ## **CFO Cybersecurity Checklist**👇 ![CFO Cybersecurity Checklist](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CFO-cybersecurity.png) --- ### FAQs: CFO cybersecurity What's the first step I should take to improve our company's cybersecurity? The first step is always to assess your current cybersecurity landscape. Understand your existing systems, potential vulnerabilities, and the value of the data you're protecting. This will help you prioritize your efforts and investments. How can I convince my board to invest more in cybersecurity? Show them the numbers! Highlight recent high-profile cyber attacks and their financial impacts. Discuss the potential cost of a data breach to your company, not just in terms of immediate financial loss, but also damage to reputation and customer trust. What's the best way to promote a cybersecurity culture within our company? Training and education are key. Regularly educate your employees about potential threats and best practices for cybersecurity. Also, lead by example. When the leadership prioritizes cybersecurity, it sets the tone for the entire organization. How can I ensure our third-party vendors aren't a cybersecurity risk? It's essential to vet your vendors' cybersecurity practices. Include cybersecurity requirements in your contracts and consider regular audits to ensure they're upholding their end of the deal. After all, your cybersecurity is only as strong as the weakest link in the chain. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### How to use Copilot in Power BI URL: https://www.financealliance.io/copilot-in-power-bi/ Last updated: 2025-09-15T08:48:27.000Z [Copilot in Microsoft](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) Power BI revolutionizes how finance teams interact with data. Powered by cutting-edge generative AI, Copilot brings a whole new dimension to data analysis, making it easier, faster, and more intuitive than ever before. But how can finance professionals use Copilot in Power BI? The integration of Copilot with Power BI is set to make a powerful impression. This strategic partnership helps level the playing field, allowing data enthusiasts of all skill levels to engage in intricate model creation. In simpler terms, Copilot is turning complexity on its head - making the difficult, doable, and the technical, *accessible*. The future of financial modeling just got a whole lot brighter, and it's a change that's sure to revolutionize how finance professionals handle their data. In this article, we explore how you can leverage the power of Copilot in Power BI to help streamline your everyday processes within your finance role. **Topics covered:** - [What is Copilot in Power BI](https://www.financealliance.io/p/27249fb6-0c2e-48cb-921e-931d71b67067/#what-is-copilot-in-power-bi) - [How finance professionals can use Copilot in Power BI](https://www.financealliance.io/p/27249fb6-0c2e-48cb-921e-931d71b67067/#how-finance-professionals-can-use-copilot-in-power-bi) - [How to use Copilot in Power BI (in simple steps)](https://www.financealliance.io/p/27249fb6-0c2e-48cb-921e-931d71b67067/#how-to-use-copilot-in-power-bi-in-simple-steps) **Source: Microsoft* ## **What is Copilot in Power BI?** [Copilot](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) is a next-generation AI large language model (LLM) that “*turns your words into the most powerful productivity tool on the planet.*” Microsoft recently announced the introduction of a Copilot assistant, which will act as your personal AI assistant, helping to automatically analyze data, create accurate reports, and answer your questions in plain English. > “*Today marks the next major step in the evolution of how we interact with computing, which will fundamentally change the way we work and unlock a new wave of productivity growth.* > *“With our new copilot for work, we’re giving people more agency and making technology more accessible through the most universal interface — natural language*.” - Satya Nadella, CEO of Microsoft You can use [Copilot in Power BI](https://powerbi.microsoft.com/en-us/blog/introducing-microsoft-fabric-and-copilot-in-microsoft-power-bi/) to analyze data, create complete reports, generate charts and graphs based on your data, and access actionable insights almost instantly. In essence, Copilot transforms how we approach data analysis, turning it from a potentially arduous task into an intuitive, AI-driven conversation. However, it's not just about making financial data analysis faster and easier. It's about making it accessible and immediately beneficial to everyone - opening up a whole new world of instant, data-driven decision-making. --- [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) --- ## **How finance professionals can use Copilot in Power BI** The integration of Copilot with Power BI offers finance professionals a powerful toolkit to navigate and utilize data more effectively and efficiently. From simplifying complex calculations to generating custom reports and creating compelling narratives, these tools will transform the way financial data is understood and applied. CEO of Microsoft, Satya Nadella, said in a recent [interview with CNBC](https://www.youtube.com/watch?v=H57nY1Kvph4), “*We’re moving to the co-pilot era of AI*.” So, how can you make sure you don’t get left behind in this new era of AI? Below, we delve into some of the many ways these cutting-edge tools can be utilized in finance: ### **1\. Interactive data visualization** Welcome to the new age of [data visualization](https://www.financealliance.io/storytelling-with-data-visualization-playbook/). Now, instead of wrestling with complex data manipulation, you can just describe the visuals and insights you're after. Copilot works its magic in the background, saving you the trouble of having to do it all manually. ### **2\. Fast and customized reporting** Forget the hours spent crafting financial reports. You can ask Copilot to create and tailor financial reports in mere seconds. From overall data trends to specific insights, Copilot ensures you get exactly what you need without wasting time. For example, you could ask Copilot something like, “*Help me build a cash flow statement report for last quarter, summarizing our key metrics and trends.*” And, it’ll create your report and even help you refine it. ### **3\. Advanced calculations and financial modeling** Making [Data Analysis Expressions](https://learn.microsoft.com/en-us/dax/) (DAX) calculations used to be a headache, but not anymore. Copilot can generate and edit these complex formulas for you, saving you time and letting you get back to providing strategic advice and insights to help guide business decisions. If you’re creating financial models for your data using complex code, you can have Copilot create it for you. Simply describe what you want, and it’ll generate code tailored to your request. ### **4\. Powerful data summaries** Power BI's Copilot allows you to create compelling narrative summaries using simple, conversational language. Let’s say you asked Copilot to create that [cash flow statement](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) we mentioned earlier. Now, you’ve got a full report and you’ve refined it to suit your company’s needs. However, you want to explore the data even *closer*. So, you ask Copilot more detailed questions about the data, and in turn, you receive in-depth insights to further support your ideas and strategies to help the business grow. Basically, it transforms your data into easy-to-understand narratives that make your insights truly shine. ### **5\. Inquisitive data exploration** Ever wished you could ask your data direct questions? Now you can. Simply ask Copilot about the aspects of your data you're interested in, and it’ll provide you with the answers. The best part is that it uses natural language, so you can ask straightforward questions and it’ll provide the answers in seconds. ### **6\. Dynamic report narratives** Strengthen your data's impact by effortlessly tailoring the tone, scope, and style of your report narratives. Seamlessly add them within your reports, providing data insights in a language that's clear, concise, and easy to grasp. ### **7\. Create accurate financial forecasts** By now, we know just how well Copilot can visualize financial data. But it can also tap into Power BI’s advanced analysis capabilities to find key influencers and outliers and create in-depth forecasts. These are just a few of the ways finance professionals can leverage Copilot and Power BI. If you have more to add, let us know inside our free [Slack community](https://www.financealliance.io/community/?utm%5Fsource=LinkedIn&utm%5Fmedium=social&utm%5Fcampaign=fa-content) for finance professionals. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/08/FA_AI_In_Finance_Playbook_CTA.jpg) ](https://www.financealliance.io/ai-in-finance-ebook/) ## **How to use Copilot in Power BI (in simple steps)** The good news is that Copilot in Power BI is very easy to use. You won’t need to take a lengthy or technical course to learn the ropes. **Step 1:** Open Power BI. **Step 2:** Type a question about your data into the Copilot tab on the screen. For example, you can request it to create a financial report or choose from the selection of ideas that Copilot has automatically generated for you. **Step 3:** Sit back and relax as Copilot sifts through your data and analyzes it to find the answers you're looking for. **Step 4:** Copilot goes the extra mile and pulls together a visually stunning report, effectively translating complex data into readily understandable, and actionable insights. **Step 5:** Dive even further into your data by asking questions, creating summaries to share with stakeholders, and more. *\[Note: For now, Copilot in Power BI is currently in private preview\].* ### Further reading: Latest News: Microsoft launches [Copilot Studio](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) [How to build custom copilots with Microsoft Copilot StudioMicrosoft’s latest technological marvel, Copilot Studio, announced at Ignite 2023, marks a revolutionary step for finance professionals.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/11/Copilot-image.webp)](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) Learn more about [Microsoft 365 Copilot and Excel](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) with this article: [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) Read all about Microsoft Fabric and how you can use it with Data Factory, Synapse Real-Time Analytics, and more here: [How to use Microsoft Fabric for data analysisWith Microsoft Fabric, you can bridge the gap between data and intelligence and integrate all your data seamlessly. These tools have opened up new possibilities, setting the stage for a new era in finance AI.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Microsoft-fabric-1.jpg)](https://www.financealliance.io/microsoft-fabric-for-data-analysis/) Learn how to use ChatGPT with Excel here: [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) And finally, discover how to use Google Bard with Excel and Google Sheets: [How to use Google Bard with Google Sheets and ExcelIn this article, we discuss the rise of Google Bard and how it can act as your personal assistant within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Bard.jpeg)](https://www.financealliance.io/google-bard-with-google-sheets-excel/) --- ### **Join the Finance Alliance Slack Community** Start networking with other CFOs and finance leaders inside our free [Slack community for finance professionals](https://www.financealliance.io/community/). Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. [Join our community today](https://www.financealliance.io/community/) ### How to use Microsoft Fabric for data analysis URL: https://www.financealliance.io/microsoft-fabric-for-data-analysis/ Last updated: 2024-05-14T20:15:19.000Z The next generation of AI in finance is here with the release of Microsoft Fabric and [Copilot in Microsoft Power BI](https://www.financealliance.io/copilot-in-power-bi/). So, why should you (and other finance professionals) care about either of these things? Well, finance tends to juggle an enormous amount of data from countless sources. And, collecting all this data is a time-consuming process. Even if you’ve managed to figure that part out, it’s difficult to harness its power effectively. With Microsoft Fabric, you can bridge the gap between data and intelligence and integrate all your data seamlessly. These tools have opened up new possibilities, setting the stage for a new era of AI in finance. Keep reading to learn how you can use Microsoft Fabric for [data analysis](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/) and bring your financial data to life. **Topics covered:** - [What is Microsoft Fabric?](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#what-is-microsoft-fabric) - [Components of Microsoft Fabric ](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#what-comes-with-microsoft-fabric) - [What is OneLake](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#what-is-onelake) - [How to leverage Microsoft Fabric for data analysis](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#how-to-leverage-microsoft-fabric-in-finance) - [How to enable Microsoft Fabric](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#how-do-i-get-microsoft-fabric) ## **What is Microsoft Fabric?** [Microsoft Fabric](https://www.microsoft.com/en-us/microsoft-fabric) is an end-to-end human-centered analytics product that brings all your data and analytics into one central, easy-to-navigate place. Fabric is like the Swiss army knife of the analytics world. It connects the best elements of Microsoft Power BI, Azure Synapse, and Azure Data Factory into one cohesive platform. The beauty of Fabric lies in its all-encompassing design. Whether you're tinkering with data infrastructures, looking for patterns, scrutinizing numbers, or searching for actionable insights, Fabric's got you covered. *\[Source:* [*Microsoft YouTube channel*](https://www.youtube.com/@Microsoft)*\]* ## **What comes with Microsoft Fabric?** Fabric offers a unified data foundation that promises to ‘*align your team within a single source of truth*.’ This means you can unite data from many sources within a single, centralized place. Microsoft Fabric offers seven core components: - [Data Factory](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#data-factory) - [Synapse Data Engineering](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#synapse-data-engineering) - [Synapse Data Warehouse](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#synapse-data-warehouse) - [Synapse Data Science](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#synapse-data-science) - [Synapse Real-Time Analytics](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#synapse-real-time-analytics) - [Data Activator](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#data-activator) - [Power BI](https://www.financealliance.io/p/bda798e1-5014-4dec-b949-192e4ea4c0ab/#power-bi) Below, we’ll explore each component or ‘experience’ in more detail: ### **Data Factory** [Data Factory in Microsoft Fabric](https://learn.microsoft.com/en-gb/fabric/data-factory/data-factory-overview?wt.mc%5Fid=tela%5Fmscom41%5Fwebpage%5Fgdc) offers a streamlined experience for data integration. It lets you ingest, prepare, and transform data from various sources. Regardless of your level of expertise, you’ll be able to transform data easily. One of the standout features is Fast Copy. It's a tool that speeds up the data movement process across your chosen data stores. In the context of finance, this means you can quickly collect and analyze financial data from various sources, enhancing decision-making processes. You can also use Fast Copy to bring data into your Lakehouse and [Data Warehouse within Fabric](https://blog.fabric.microsoft.com/en-us/blog/introducing-data-factory-in-microsoft-fabric/) for further analytics. This feature ensures your financial data is always *where* you need it *when* you need it. Some great features include: **Data integration** As mentioned above, Azure Data Factory lets you pull data from different sources with over 150 connectors. The process is automated in a three-part pattern consisting of three stages: Extract, Transform, and Load. **Dataflows** Dataflows serve as a user-friendly tool for managing data from an array of sources. It offers over 300 [data transformations](https://www.financealliance.io/what-is-finance-transformation/) for your convenience. With Dataflows, you can also easily distribute data to various destinations, including Azure SQL databases. These processes can be set to run manually, on a schedule, or as part of a data pipeline orchestration. **Data pipelines** Data pipelines offer robust data orchestration capabilities, allowing for the creation of complex and flexible workflows. Data pipelines are equipped with built-in control flow capabilities, meaning they enable the construction of logic-driven workflows, perfect for handling multiple tasks. With this feature, you can easily manage data pipelines and consolidate hybrid data more effectively. --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ### **Synapse: Data Engineering** Synapse [data engineering](https://blog.fabric.microsoft.com/en-us/blog/introducing-synapse-data-engineering-in-microsoft-fabric/) in Fabric offers an elite platform designed for large-scale data transformation and democratization via the Lakehouse (OneLake). Data is stored as tables or files, depending on each source type. You can also use shortcuts and other methods to move data from one source to the Lakehouse. This upgraded version of Synapse strengthens the authoring experience, facilitates instant start with live pools, and enhances collaboration, making data management, table management, and transformation more efficient. ### **Synapse: Data Warehouse** Data warehousing plays an integral role in business strategy, serving as the backbone for managing and analyzing enormous volumes of data. It's the key to unlocking informed decision-making and fostering business expansion. Enter [Synapse Data Warehouse](https://blog.fabric.microsoft.com/en-us/blog/introducing-synapse-data-warehouse-in-microsoft-fabric/), which is currently in preview. It brings exceptional SQL performance and scalability to the table, making it a game-changer in the industry. With Synapse, data engineers, warehousing professionals, and BI analysts can finally work in harmony on a unified open format, leading to a singular, reliable source of truth for everyone involved. It's a leap forward in [data management](https://www.financealliance.io/7-data-management-problems-and-solutions/), set to redefine the way businesses and finance teams interact with their data. --- [How to use GPT-4o in finance (and data analysis)You can now upload Excel, CSV, and other spreadsheet files directly to GPT-4o. No more copying and pasting data into ChatGPT manually, which makes the entire process of analyzing complex data sheets a lot easier and less time-consuming.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/GPT-4o-finance-2.jpg)](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/) --- ### **Synapse Data Science** [Synapse Data Science in Fabric](https://blog.fabric.microsoft.com/en-us/blog/introducing-synapse-data-science-in-microsoft-fabric/) is an end-to-end tool that simplifies the entire process of creating sophisticated AI models. It's a collaborative hub where data scientists can work alongside data engineers and BI analysts to train, deploy, and manage [machine learning](https://www.financealliance.io/fpa-machine-learning/) models at an incredible pace and scale. ### **Synapse Real-Time Analytics** Ever wondered how to make sense of the data tsunami streaming in from various sources? Enter [Synapse Real-Time Analytics](https://blog.fabric.microsoft.com/en-us/blog/sense-analyze-and-generate-insights-with-synapse-real-time-analytics-in-microsoft-fabric/) to help you analyze huge volumes of semi-structured data and more importantly, to do so in real-time. It's not just about keeping up with the pace of incoming data; it's about turning that data into actionable insights quickly and efficiently. ### **Data Activator** [Data Activator](https://blog.fabric.microsoft.com/en-us/blog/driving-actions-from-your-data-with-data-activator/) is a no-code Microsoft Fabric experience that keeps a watchful eye on your data analytics and can trigger notifications and actions when it detects specific patterns in your data. ### **Power BI** When you use Power BI in Fabric, you can really take your data insights to a whole new level. It's recognized for its strong visualization and AI-driven analytics capabilities, making it an excellent resource for finance professionals seeking to extract knowledge from data. [![Source: Microsoft Fabric and Power BI](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/ms-powerBI.webp)](https://www.microsoft.com/en-us/microsoft-fabric#tabxc6542732277245beae4affbb3a0d5680) Source: [Microsoft Fabric and Power BI](https://www.microsoft.com/en-us/microsoft-fabric#tabxc6542732277245beae4affbb3a0d5680) You can also tap into [Microsoft’s Copilot in Power BI](https://www.financealliance.io/copilot-in-power-bi/) and use it to create reports, translate complex data into actionable insights, and more. Then, share them with apps and other tools such as [Microsoft Excel](https://www.financealliance.io/chatgpt-for-excel/). --- [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) --- ## **What is OneLake?** OneLake is a multi-cloud data lake that's ready to go as soon as you set up your Fabric tenant. It's like the OneDrive of Microsoft 365 but for all your Fabric workloads. But [OneLake](https://blog.fabric.microsoft.com/en-us/blog/microsoft-onelake-in-fabric-the-onedrive-for-data/) isn't just a storage system—it's a tool that promotes collaboration and harmony within your finance team (and beyond). Developers, finance professionals, and business users can all use OneLake, waving goodbye to those chaotic data silos that occur when everyone has their own storage accounts. Now, discovering and sharing data is a lot easier with security settings managed centrally for peace of mind. [![OneLake image from Microsoft](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/ms2.png)](https://blog.fabric.microsoft.com/en-us/blog/microsoft-onelake-in-fabric-the-onedrive-for-data/) Source: [**Microsoft OneLake in Fabric, the OneDrive for Data*](https://blog.fabric.microsoft.com/en-us/blog/microsoft-onelake-in-fabric-the-onedrive-for-data/) OneLake isn't reinventing the wheel—it's built on and fully compatible with Azure Data Lake Storage Gen2 (ADLSg2). This means you're not just getting a storage system; you're getting access to an expansive ecosystem of apps, tools, and developers. ### What is the OneLake ‘Shortcuts’ feature? OneLake also brings a handy feature called "Shortcuts" to the table. Instead of moving and duplicating data all over the place, Shortcuts let you share data easily between users and applications. And the best part? It isn't limited to ADLSg2\. You can also virtualize data lake storage in Amazon Simple Storage Service (Amazon S3) and, soon, Google Storage. This means you can pull together and analyze data across different clouds, keeping all your data interconnected. So, in essence, OneLake isn't just a data lake—it's a bridge between different data sources, keeping your data flow seamless and efficient. ## **How to leverage Microsoft Fabric for data analysis** Now, let’s dive into some examples of how finance professionals can leverage Microsoft Fabric for better data analysis: ### **1\. Unifying data sources** Microsoft Fabric allows for the seamless integration of data from various sources. Whether it's from ERP systems, CRM tools, or financial databases, Fabric enables a finance professional to gather it all into a single dataset. For instance, a financial analyst could compile data from all these different systems, facilitating a comprehensive financial report that would otherwise take quite some time to complete. ### **2\. Eliminating data silos with OneLake** Fabric's built-in multi-cloud data lake, OneLake, serves as a unified, centrally managed hub for all your data needs. A multinational finance team dealing with data from several regional offices could leverage OneLake to store and access data from one place. This helps to do away with data silos, promoting better data governance and team collaboration. ### **3\. Powering up with Power BI** The integration of Power BI into Fabric brings AI-driven analytics and superior [data visualization tools](https://www.financealliance.io/storytelling-with-data-visualization-playbook/) right to your fingertips. With these tools, raw financial data can be turned into meaningful insights. An example of this in action could be when it comes to analyzing trends, you could identify areas for cost-cutting, or discover profitable opportunities. ### **4\. Making the most of shortcuts** OneLake offers a feature called "Shortcuts," allowing easy sharing of data between users and applications without unnecessary duplication. For example, a financial controller needing regular updates from both an internal finance database (on Azure) and an external stock market feed (on Amazon S3) could use Shortcuts to unify and analyze this data efficiently. ### **5\. Utilizing real-time analytics for financial decisions** The Synapse Real-Time Analytics feature in Fabric could be a game-changer for finance professionals. It provides the ability to analyze large volumes of data streaming in real time. In a finance scenario, this could be used to track market fluctuations or monitor transactional data for immediate risk assessment or decision-making. In summary, Microsoft Fabric brings together a wealth of features designed to help finance professionals streamline their data analysis processes, generate actionable insights, and collaborate more effectively. --- [How to use Google Bard with Google Sheets and ExcelIn this article, we discuss the rise of Google Bard and how it can act as your personal assistant within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Bard.jpeg)](https://www.financealliance.io/google-bard-with-google-sheets-excel/) --- ## **How do I get Microsoft Fabric?** Fabric will be turned on by default on July 1 for all Power BI tenants. However, if want to access it now, you can by turning on the Fabric tenant setting in the admin portal of Power BI. You can also activate Fabric for select capacities via the 'Capacity Settings' tab found in the admin portal. Just as with the full tenant settings, you also have the option to restrict access to these specific capacities to certain users or security groups. This way, you can experiment with and assess the impact of Fabric in a controlled manner before a full-scale rollout. If you don't currently possess Power BI Premium but are keen to try out Fabric, there's an available free Fabric trial (*more details about the* [*Fabric trial*](https://learn.microsoft.com/en-gb/fabric/get-started/fabric-trial) *can be found online*). ### Further reading: Learn more about Microsoft 365 Copilot and Excel with this article: [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) Read all about how to use Copilot with Power BI here: [How to use Copilot in Power BIIn this article, we explore how you can leverage the power of Copilot in Power BI to help streamline your everyday processes within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/copilot-in-power-bi-2.jpg)](https://www.financealliance.io/copilot-in-power-bi/) Find out how to use ChatGPT with Excel here: [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) And finally, discover how to use Google Bard with Excel and Google Sheets: [How to use Google Bard with Google Sheets and ExcelIn this article, we discuss the rise of Google Bard and how it can act as your personal assistant within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Bard.jpeg)](https://www.financealliance.io/google-bard-with-google-sheets-excel/) --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### ESG metrics: How to drive sustainable business success URL: https://www.financealliance.io/esg-metrics/ Last updated: 2025-04-07T16:42:43.000Z If you're a Chief Financial Officer (CFO), you're probably familiar with environmental, social, and governance (ESG) metrics. But understanding their complexities and navigating the ESG ecosystem can be a challenge for even the most seasoned CFO. In this article, we demystify ESG metrics and provide actionable strategies to help you use them to drive sustainable business success. **Topics covered:** - [What are ESG metrics?](https://www.financealliance.io/p/e8f33076-9adc-4304-a23b-7dab1b0c3f11/#what-are-esg-metrics) - [Why are ESG metrics so important?](https://www.financealliance.io/p/e8f33076-9adc-4304-a23b-7dab1b0c3f11/#why-are-esg-metrics-so-important) - [ESG standards and frameworks](https://www.financealliance.io/p/e8f33076-9adc-4304-a23b-7dab1b0c3f11/#esg-standards-and-frameworks) - [Examples of ESG standards, frameworks, and reporting](https://www.financealliance.io/p/e8f33076-9adc-4304-a23b-7dab1b0c3f11/#examples-of-esg-standards-frameworks-and-reporting) - [Qualitative vs quantitative ESG metrics](https://www.financealliance.io/p/e8f33076-9adc-4304-a23b-7dab1b0c3f11/#qualitative-vs-quantitative-esg-metrics) - [ESG metric examples and how to measure ESG metrics](https://www.financealliance.io/p/e8f33076-9adc-4304-a23b-7dab1b0c3f11/#common-esg-metrics-and-how-to-measure-them) - [How to choose which ESG metrics to use](https://www.financealliance.io/p/e8f33076-9adc-4304-a23b-7dab1b0c3f11/#how-to-choose-which-esg-metrics-to-use) - [How to leverage ESG metrics for business success](https://www.financealliance.io/p/e8f33076-9adc-4304-a23b-7dab1b0c3f11/#how-to-leverage-esg-metrics-for-business-success) ## What are ESG metrics? ESG metrics serve as key performance indicators to measure a company's operations in relation to environmental, social, and governance criteria. They shed light on a company's performance, potential risks, and overall corporate responsibility. Businesses will often weave these metrics into the fabric of their company, influencing policies, reports, and operations. With ESG metrics, you can align company practices with the principles of environmental stewardship, social responsibility, and robust governance. ### Is ESG reporting mandatory? Back in May 2022, the [US Securities and Exchange Commission](https://www.sec.gov/news/press-release/2022-92) (SEC) called for “*amendments to rules and reporting forms to promote consistent, comparable, and reliable information for investors concerning funds’ and advisers’ incorporation of environmental, social, and governance (ESG) factors*.” Although SEC currently maintains a [comply-or-explain regime with some mandatory reporting features](https://www.sec.gov/news/public-statement/coates-esg-disclosure-keeping-pace-031121), there's no universal mandate that applies across all industries. Some companies voluntarily include ESG disclosures in their annual reports. Many produce standalone sustainability reports, keeping investors and the wider public updated about their ESG actions and commitments. We advise researching your country's ESG reporting regulations to avoid any mishaps. Although ESG reporting isn’t mandatory,[**74%**](https://assets.ey.com/content/dam/ey-sites/ey-com/en%5Fgl/topics/assurance/assurance-pdfs/ey-2021-corporate-reporting-survey.pdf)[ of finance leaders](https://assets.ey.com/content/dam/ey-sites/ey-com/en%5Fgl/topics/assurance/assurance-pdfs/ey-2021-corporate-reporting-survey.pdf) said they’d like reporting of ESG performance measures against a set of globally consistent standards to be a mandatory requirement. Interestingly, this increased to **89%** for investors. ## Why are ESG metrics so important? ESG metrics are important because they paint a holistic picture of a company's health, highlighting potential risks and opportunities that might otherwise be overlooked. Notably, they also appeal to a rising breed of socially conscious investors, aligning financial gains with positive societal and environmental impact. ESG metrics for companies make sustainability commitments more than just words. They hold companies accountable and turn bold claims into clear, trackable KPIs. Measuring ESG performance metrics offers a level of transparency that strengthens trust between the company and the consumer, regulator, or investor. --- [5 ESG investing trends every CFO needs to watch closelyHow prepared are you for the rising dominance of Environmental, Social, and Governance (ESG)? In this post, we’re looking at some interesting ESG market trends to pay close attention to…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/ESG-investing-trends-2022.jpg)](https://www.financealliance.io/5-esg-investing-trends/) --- ## ESG standards and frameworks When it comes to ESG reporting, standards, frameworks, and questionnaires often make an appearance. But what do these terms actually mean? And more importantly, how do they help convey ESG performance? ### ESG standards Think of a standard as your detailed roadmap for ESG disclosure. It gives you specific performance measures or metrics to report on, so there's no confusion. ESG standards are created with a public interest focus, ensuring independence, due process, and public consultation. This governance process ensures standards are trustworthy. It also reinforces their purpose: providing clear criteria for reporting ESG performance, targets, and policies. ### ESG frameworks An ESG framework is a set of principles to guide and shape understanding of ESG topics. However, the framework doesn't necessarily lay down the methodology for data collection or reporting. Rather, it gives you high-level disclosures while leaving room for maneuvering. Unlike standards, frameworks follow simpler advisory processes for creation. So, while they may not be as detailed, they’re flexible and adaptable to your specific circumstances. ### ESG questionnaires Finally, an ESG questionnaire is essentially a third-party audit of your ESG practices. These are surveys designed to evaluate your sustainability performance and result in an ESG rating or score. It's voluntary, and the questions usually align with existing standards and frameworks. However, questionnaires are usually confidential and the methodologies behind them are less transparent. --- [Managing Complex Change Matrix for CFOs (Lippit-Knoster Model)Change is often necessary to help companies stay adaptable, competitive, and prepared for new challenges. One tool that has proven helpful in this area is the Lippitt-Knoster Model for Managing Complex Change Matrix, which provides a clear framework for handling change.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/managing-complex-change-model-2.jpg)](https://www.financealliance.io/managing-complex-change-matrix/) --- ## Examples of ESG standards, frameworks, and reporting ESG frameworks are developed by global bodies like the *World Economic Forum*. They’re designed to help identify, assess, document, and measure a company’s commitment to ESG issues. These ESG frameworks take the guesswork out of sustainability by laying down an ESG KPI list of sorts. These metrics act like milestones, giving tangible markers to measure your progress against. Think of it as turning ESG commitment into something of a science, ensuring you’ve concrete, comparable data to guide the company’s actions and decisions. But what's the point of all these metrics and measurements? The answer is transparency and accountability. This is where ESG reporting comes into play. ESG reports are detailed accounts of how you’re delivering on your ESG commitments. They're designed for all your stakeholders - governments, NGOs, investors, and of course, the public - providing clear insight into the company’s ESG initiatives and how you're progressing toward your goals. To help you get your head around these metrics, here is a brief overview of some examples of ESG frameworks available: ### Global Reporting Initiative (GRI) GRI is an independent, international organization dedicated to helping companies take responsibility for their impacts. According to [KPMG](https://kpmg.com/xx/en/home/insights/2022/09/survey-of-sustainability-reporting-2022.html), the GRI Standards remain one of the most commonly used anchors for sustainability reporting. They're used by over 10,000 organizations in over 100 countries. GRI's approach is all about shining a light on an organization's contributions, both positive and negative, to sustainable development. The [GRI Standards](https://www.globalreporting.org/how-to-use-the-gri-standards/gri-standards-english-language/) aren't a one-size-fits-all solution. They're a flexible, “[modular system of interconnected standards](https://www.globalreporting.org/media/s4cp0oth/gri-gristandards-visuals-fig1%5Ffamily-2021-print-v19-01.png)”, broken down into three parts: **1.** **GRI Universal Standards:** These apply to every organization out there. **2\. GRI Sector Standards:** These are tailored to the unique needs and impacts of specific sectors. **3\. GRI Topic Standards:** These focus on disclosures relevant to distinct topics. ![Examples of GRI standards for ESG ](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/ESG-metric-1.jpg) Example of [**GRI Standards*](https://www.globalreporting.org/how-to-use-the-gri-standards/gri-standards-english-language/) ### Future-Fit Business [Future-Fit Business](https://futurefitbusiness.org/about-us/) (Foundation) is a charity dedicated to helping business leaders, policymakers, and investors “*respond effectively to today’s biggest challenges*” by being environmentally restorative, socially just, and economically inclusive. The Future-Fit benchmark covers everything from how to avoid accusations of greenwashing to how to implement the benchmark in your organization as seamlessly as possible. ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/esg-metric-2.jpg) Example image sourced from [**Future-Fit Business*](https://futurefitbusiness.org/about-us/) ### The Task Force on Climate-related Financial Disclosures (TCFD) In response to the need for robust climate-related risk disclosures, the Financial Stability Board (FSB) set up the [Task Force on Climate-related Financial Disclosures ](https://assets.bbhub.io/company/sites/60/2022/10/2022-TCFD-Status-Report.pdf)(TCFD). They aimed to construct guidelines on what information organizations should share, assisting investors, lenders, and insurers in making well-informed evaluations and appraisals of climate-associated risks. TCFD’s framework includes climate-related risks and opportunities to help companies disclose these details effectively and covers how to disclose: - **Governance:** Related to climate-related risks and opportunities. - **Strategy:** Actual and potential impacts of related risks and opportunities on the company’s strategy and financial planning. - **Risk management:** How a company identifies, assesses, and manages risks related to the climate. - **Metrics and targets:** The relevant metrics and targets (related to the climate) the company uses. ![ESG KPI image from TCFD Report](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/esg-metric-3.jpg) Sample image source: [**Task Force on Climate-related Financial Disclosures*](https://assets.bbhub.io/company/sites/60/2022/10/2022-TCFD-Status-Report.pdf) ### World Economic Forum (WEF) Established in 1971, the [WEF](https://www.weforum.org/about/world-economic-forum) is an international organization for public-private cooperation. It engages the “*foremost political, business, cultural and other leaders of society to shape global, regional and industry agendas*.” The World Economic Forum (WEF) developed a suite of ESG performance indicators, referred to as the 'Stakeholder Capitalism Metrics.' This aids businesses in standardizing ESG reporting and monitoring their strides toward Sustainable Development Goals (SDGs) on a consistent basis. You can find everything you need to know in their report, [*Measuring Stakeholder Capitalism: Towards Common Metrics and Consistent Reporting of Sustainable Value Creation*](https://www.weforum.org/reports/measuring-stakeholder-capitalism-towards-common-metrics-and-consistent-reporting-of-sustainable-value-creation)*.* ![ESG metrics examples from WEF](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/esg-metric-4.jpg) Source: [**Word Economic Forum*](https://www3.weforum.org/docs/WEF%5FIBC%5FMeasuring%5FStakeholder%5FCapitalism%5FReport%5F2020.pdf) ### International Sustainability Standards Board The International Sustainability Standards Board (ISSB) is committed to formulating standards that present a comprehensive, quality-assured global groundwork for sustainability disclosures, keeping in mind the requirements of investors and financial markets. The [ISSB](https://www.ifrs.org/groups/international-sustainability-standards-board/#:~:text=The%20ISSB%20is%20committed%20to,to%20investors%20across%20markets%20globally.) has mapped out four primary goals: - The creation of standards that constitute a global foundation for sustainability disclosures. - Addressing information necessities of investors. - Equipping businesses with the means to communicate extensive sustainability information to the global capital markets. - Enabling coherence with disclosures that are region-specific and/or target broader stakeholder groups. --- [Storytelling with Data Visualization Playbook | Finance AllianceDiscover the essential components of a powerful data narrative and learn how to weave them together to create a story that resonates with your audience.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/FA_Storytelling_with_Data_Visualization_Blog_Meta_2.png)](https://www.financealliance.io/storytelling-with-data-visualization-playbook/) --- ## Qualitative vs quantitative ESG metrics Qualitative ESG metrics are all about descriptive data that can't be crunched into numbers. They provide insights into a company's strategies, operations, and other unique traits that are tough to pin down numerically. This means when collecting data for this ESG metric, it’s easier to use words rather than numbers. ESG quantitative metricsare data you can collect and assess in numbers (or numerical patterns). They can be set in hard stats and figures that can be plugged into a calculation or a spreadsheet. They dish out data in forms such as percentages, monetary values, or other measurable units, giving you a clear, numerical snapshot of your company's ESG performance. They might provide insights like how much product you're shifting, or the mileage your imports and exports are racking up. So, while qualitative metrics weave the story, quantitative metrics give you the cold, hard facts. Both are essential for a holistic understanding of a company's ESG impact. ## Common ESG metrics (and how to measure them) If it helps, try to think of ESG metrics like a giant jigsaw puzzle, with pieces belonging to the environment, social, and governance pillars. The picture that comes into focus is influenced by the framework you choose to follow. But here's a tip: if your goal goes beyond just ticking the compliance boxes, it pays to adopt a wider lens. Also, keep in mind that not all ESG metrics are created equal. You’ll discover that some can neatly fit into spreadsheets as numbers and percentages. On the other hand, you’ll come across others that might be a simple tick in a box. Here is a list of ESG metrics to consider and how to measure them: ## Environmental metrics Environmental metrics center around how a business's activities influence the world around us - our air, water, land, and the various species that call this planet home. It's all about understanding the ecological footprint of a company's operations, products, and services. Below, we’ll discuss some standard ESG environment metrics but it’s worth noting that you may want to include additional metrics according to your business and the framework you choose to use. ### Greenhouse gas emissions (GHGs) The amount of harmful gases a company releases into the atmosphere is a key ESG metric. Tracking CO2 and methane emissions allows businesses to identify the largest sources of their emissions and target those areas for improvement. Companies can use carbon accounting methodologies and tools, considering direct emissions (from owned or controlled sources) and indirect emissions (from purchased electricity, steam, heating, and cooling). > **Measure:** *Levels of methane (CH4), carbon dioxide (CO2), carbon monoxide (CO), and nitrous oxide (N2O).* ### Energy efficiency This measures how much energy a company uses to produce its goods or services, with the goal being to achieve the same or better outcomes with less energy. It’s an important ESG KPI because the quantity of energy a company consumes to produce its goods or services can significantly impact its environmental impact. More efficient use of energy reduces both operating costs and reliance on fossil fuels. > **Measure:** *Energy consumption per unit of output such as kilowatts per hour (kWh). You can use energy management software that provides insights into usage patterns to help with this.* ### Water use and management With water scarcity affecting many parts of the world, efficient water usage is not only environmentally responsible but also essential for risk management. Companies must monitor total water withdrawal, recycled water, and their water usage impact on local ecosystems. > **Measure:* Water footprint calculators and water accounting methodologies can help track this ESG KPI by measuring water consumption (liters or cubic meters).* ### Waste management Sustainable waste management means a company is not only reducing the waste it generates but also maximizing its recycling efforts. This reduces environmental harm and can cut costs. Waste includes everything from solid waste such as plastic to hazardous waste, radioactive waste, and so on. > **Measure:* Regular waste audits can identify the types and amounts of waste produced, and waste tracking software can provide ongoing monitoring. Waste usage is measured in cubic meters, tons, and/or kilograms.* ### Air pollution Beyond greenhouse gases, a company's operations can emit other harmful substances into the air, such as dust, dirt, soot, and sulfur compounds from burning oil and coal. Monitoring these emissions helps protect air quality and public health. > **Measure:* Emission measurement devices or calculations based on fuel usage can provide accurate measures. For example, a gas monitor.* ### Biodiversity impact A company's operations can significantly impact local ecosystems, from changing land use to disrupting local species. Tracking these impacts helps protect biodiversity, an essential component of a healthy planet. Ecological surveys or environmental impact assessments can provide this information. > **Measure:* Quantify and monitor elements such as land use, resource depletion, etc.* ### Raw material sourcing Sustainable sourcing helps reduce the environmental harm caused by extracting and transporting raw materials. It also ensures the sustainability of supply chains. > **Measure:* Certifications like FSC (for wood products) or MSC (for fish) and life cycle assessments can track sustainable sourcing and assess overall environmental impact.* --- [CFO vs CPA: Does a CFO need a CPA?There’s no rulebook saying you must be a CPA to excel as a CFO. In this blog post, we clear up the confusion between CFOs and CPAs and explore whether you need a CPA to become a successful CFO (spoiler - you don’t!).![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/cfo-vs-cpa-image.jpg)](https://www.financealliance.io/cfo-vs-cpa/) --- ## Social metrics Social metrics are the pillars of social responsibility in an organization, addressing a broad spectrum of issues ranging from workforce diversity to human rights. Social metrics don't only mirror a company's internal culture but also show how a business aligns its practices with societal expectations, fostering trust and enhancing its reputation in the process. ### Charity and philanthropy This captures the magnitude of a company's efforts to give back to the community, reflecting its societal contributions. From organizing volunteering programs to making financial contributions, this metric helps gauge the depth of a company’s philanthropic spirit > **Measure:* Add up your financial donations, volunteer hours, and the number of community initiatives you support.* ### Comparative living wages A metric that establishes whether a company pays wages that align with or surpass the living cost in the regions it operates. By ensuring fair wages, businesses can positively impact their employees' living standards. > **Measure:* Wage comparisons against local living cost indexes can help measure this.* ### Diversity and inclusion ESG diversity metrics quantify the level of workforce diversity across different demographic attributes like ethnicity, gender, or age. Furthermore, it examines how well the organization includes and values these diverse groups. > **Measure:* Employing methods like surveys, demographic data analysis, and gathering employee feedback can provide insights into these areas.* ### Employee engagement This metric reveals the degree of employees' emotional connection and commitment to their organization, which typically signifies a positive company culture. > **Measure:* Regular employee surveys, attrition rates, and performance metrics can be excellent indicators of engagement levels.* ### Gender pay gap This ESG metric highlights any pay disparity between men and women for the same job roles within a company, representing a crucial aspect of employment fairness. > **Measure:* Regular pay audits and comparative salary analysis will help measure this.* ### Health and safety Health and safety is an important one because it assesses the work environment in terms of accident rates and health hazards, and the efforts made to promote employee well-being. > **Measure:* Tracking incidences of workplace accidents, sick leaves, and the implementation of wellness and safety programs helps in measuring these aspects.* ### Human rights This metric embodies a company's commitment to upholding human rights within its premises and throughout its supply chain. Compliance with child labor laws, fair work conditions, and workers' rights are integral parts of this. > **Measure:* Regular audits and obtaining third-party certifications are methods to measure these aspects.* ### Reskilling and training This assesses a company's investment in upgrading and enhancing the skills of its workforce. > **Measure:* This ESG metric can be quantified by the number of training hours per employee, funds allocated to training and development, and/or the number of employees who undergo training.* ### Wealth generation Wealth generation evaluates the economic value a company creates for its stakeholders, which includes employees, shareholders, and the local community. > **Measure:* Calculating economic value added (EVA) or other financial impact tracking methods can measure this.* --- [Operational finance: A CFO’s guide to leadership stylesOperational finance is an essential aspect of a successful CFO’s skill set. But mastering the operational side alone isn’t enough. You also need to wear your strategic leadership hat too and learn to balance both for maximum impact. But how?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CFO-operational-finance.jpg)](https://www.financealliance.io/operational-finance/) --- ## Governance metrics ESG governance metrics focus on how a company is run and how well it adheres to ethical business practices. Here are some of the key governance metrics, what they mean, and how they can be measured: ### Board composition This refers to the diversity and independence of a company's board of directors. A diverse and independent board can foster a variety of perspectives and reduce the risk of conflicts of interest. > **Measure:* Companies can measure this by tracking the demographic diversity (such as gender, race, age, etc.) and professional backgrounds of their board members, as well as their independence (i.e., not having ties to company management).* ### Executive compensation This involves the pay packages for a company's top executives and how well they align with the company's performance. > **Measure:* Compare executive pay to company performance indicators like profits or share price. They can also compare their executive pay ratios (the CEO's pay as a ratio of the median employee's pay) to industry norms.* ### Ethics and anti-corruption policies This measures a company's commitment to ethical business practices and its efforts to prevent corruption. > **Measure:* You can track this through internal audits and compliance checks. Or, you can also monitor any violations of their ethics policies or any legal issues related to corruption.* ### Shareholder rights This refers to how well a company respects the rights of its shareholders. > **Measure:* Keep track of shareholder votes, any disputes with shareholders, and their efforts to engage with shareholders.* ### Regulatory compliance Regulatory compliance is how well a company adheres to laws and regulations. > **Measure:* Trail regulatory fines, warnings, and inspections.* ### Transparency and reporting This refers to a company's openness about its operations, financials, and ESG performance. > **Measure:* Evaluate the quality and frequency of your financial and sustainability reporting, as well as any third-party recognition you receive for transparency.* --- [7 data management problems and solutionsData management plays a pivotal role in driving insightful decisions and ensuring the financial success of a company. But let’s face it – navigating this intricate landscape can feel like a battle, filled with data management challenges like inaccuracies, security breaches, and complex integrations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/markus-spiske-8OyKWQgBsKQ-unsplash-2.jpg)](https://www.financealliance.io/7-data-management-problems-and-solutions/) --- ## **How to choose which ESG metrics to use** As a CFO, choosing the right ESG metrics for your company can seem like a daunting task given the myriad of options available. But it doesn't have to be. Here are some tips to help you decide which ESG KPIs and metrics to focus on: ### 1\. Know your industry and your company Different sectors face different ESG challenges. The primary metrics for a manufacturing company will be different from those of a tech startup. Analyze your company's operations and sector to understand which ESG issues are most pertinent. ### 2\. Align with company strategy The selected ESG metrics should align with the company's overall strategy and values. If your company has committed to becoming carbon-neutral, for example, you'll need to track CO2 emissions closely. ### 3\. Identify stakeholder concerns The views and expectations of stakeholders, including investors, employees, customers, and the wider community, should be factored into your decision-making process. For instance, if your shareholders are particularly focused on social impact, metrics related to workforce diversity and community involvement would be important to track. ### 4\. Consider legal and regulatory requirements Depending on your geographical location and industry, there may be legal or regulatory requirements that dictate which ESG metrics you need to monitor and disclose. ### 5\. Benchmark against peers Look at the ESG metrics that your industry peers and competitors are using. This can provide useful insights into industry best practices and [ESG trends](https://www.financealliance.io/5-esg-investing-trends/). ### 6\. Leverage ESG frameworks Utilize established ESG frameworks and standards to help guide your selection of metrics. These frameworks have been developed by experts and provide a comprehensive approach to ESG reporting. ### 7\. Ensure the feasibility of data collection Lastly, it's important to consider whether you have the capabilities to reliably gather and measure the data required for your chosen metrics. The selected ESG metrics should be practical and feasible for your business to implement. ## How to leverage ESG metrics for business success Here's your quick guide to boost them to drive business success: ### Link metrics to strategy It's essential to make your ESG metrics part of your core business strategy. They're not just 'nice to have'—they're powerful tools for [value creation and risk management](https://www.financealliance.io/value-creation-plan/). ### Storytelling is key How you communicate your ESG efforts matters. Craft a compelling narrative around your ESG performance, linking it to your business's broader vision and values. This will resonate with stakeholders and create brand loyalty. ### Stay ahead with tech Embrace technology. [Advanced analytics](https://www.financealliance.io/what-is-big-data-security-analytics/) and AI can help you track your metrics more accurately and identify areas for improvement more quickly. ### Engage stakeholders Keep the lines of communication open. Regularly engage with investors, employees, and customers to update them on your ESG progress. Their feedback can provide valuable insights for future action. ### Continuous improvement Make ESG a journey, not a destination. Regularly review your metrics and progress, adjusting your approach and goals as necessary. Remember, successfully leveraging ESG metrics isn't just about the numbers. It's about embedding [sustainable finance](https://www.financealliance.io/are-you-prepared-for-esg-and-sustainable-finance/) practices into your business DNA and using them to drive meaningful change and success. --- ### FAQs: ESG metrics What are ESG metrics and why are they important? ESG metrics measure a company's environmental, social, and governance performance. They're vital because they help companies track their sustainability efforts, inform strategic decisions, and demonstrate their commitment to sustainable practices to stakeholders. How do we select the right ESG metrics for our company? Start with your company’s strategy and values. Consider your industry, size, geography, and stakeholder expectations. Use these factors to identify the most relevant ESG issues, and select metrics that align with these. How can we ensure the accuracy of our ESG data? Accuracy starts with robust data collection and validation processes. Technology can play a big role here. Using dedicated ESG software or platforms can ensure consistency and reliability in your ESG reporting. What's the role of a CFO in ESG reporting? As a CFO, you're a key player in ESG reporting. You'll help to select relevant metrics, oversee data collection and reporting, and communicate the financial implications of ESG performance to investors and other stakeholders. How is ESG performance measured? ESG performance is measured using a combination of qualitative and quantitative metrics, often aligned with established standards or frameworks. Data is gathered from various sources, analyzed, and then reported in a structured manner. How do you evaluate an ESG report? When evaluating an ESG report, look for comprehensiveness, relevance, accuracy, and transparency. Check if the company has used recognized standards or frameworks and whether the data is audited. Also, see if the report aligns with the company's overall strategy and operations. --- ### Join the Finance Alliance Slack Community Start networking with other CFOs and finance leaders inside our free [Slack community for finance professionals](https://www.financealliance.io/community/). Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. [Join our community today](https://www.financealliance.io/community/) ### How to use Google Bard with Google Sheets & Excel URL: https://www.financealliance.io/google-bard-with-google-sheets-excel/ Last updated: 2025-09-15T08:48:29.000Z *\[Note: Bard is now* [*Gemini*](https://www.financealliance.io/how-to-use-gemini-ai-with-google-sheets/)*\]* As finance professionals, we swim in an ocean of numbers, and deciphering these digits is both our challenge and our craft. However, the way we view, understand, and present these figures is changing, thanks to the transformative power of AI. We’ve seen the rising growth of finance professionals using [ChatGPT in Excel](https://www.financealliance.io/chatgpt-for-excel/) and now, with Google Bard on the scene, we’re all left wondering if Bard can assist us even *better* than ChatGPT. Can it help create accurate financial reports? How about analyzing large datasets? These are just some of the questions we answer in this article, where we discuss the rise of Google Bard and how it can act as your personal assistant within your finance role. **Topics covered:** - [What is Google Bard?](https://www.financealliance.io/p/49703a08-9623-49ac-ac80-a080a7fa2dba/#what-is-google-bard) - [What’s the difference between ChatGPT and Bard](https://www.financealliance.io/p/49703a08-9623-49ac-ac80-a080a7fa2dba/#chatgpt-vs-bard-what%E2%80%99s-the-difference) - [How to use Bard with Google Sheets](https://www.financealliance.io/p/49703a08-9623-49ac-ac80-a080a7fa2dba/#can-you-use-bard-in-google-sheets) - [How to use Bard with Excel](https://www.financealliance.io/p/49703a08-9623-49ac-ac80-a080a7fa2dba/#how-to-use-bard-with-excel) - [Bard in finance](https://www.financealliance.io/p/49703a08-9623-49ac-ac80-a080a7fa2dba/#bard-in-finance) - [Bard vs ChatGPT: A case study](https://www.financealliance.io/p/49703a08-9623-49ac-ac80-a080a7fa2dba/#bard-vs-chatgpt-a-case-study) ## What is Google Bard? Google Bard is a large language model (LLM) chatbot developed by Google AI. It’s trained on a massive dataset of text and code and can generate text, translate languages, write creative content, and answer questions. You can even have a conversation with Bard directly about anything from the weather to the latest economic news and insights. It's worth noting that Google itself calls Bard an ‘experimental conversational AI service’. According to [Google](https://blog.google/technology/ai/bard-google-ai-search-updates/), Bard seeks to… > *“…combine the breadth of the world’s knowledge with the power, intelligence, and creativity of our large language models. It draws on information from the web to provide fresh, high-quality responses. Bard can be an outlet for creativity and a launchpad for curiosity.”* Google Bard is a powerful new tool, but is it better for streamlining finance tasks than ChatGPT? That remains to be seen. For now, though, let’s take a closer look at the main differences between the two [artificial intelligence](https://www.aiacceleratorinstitute.com/your-guide-to-artificial-intelligence/) chatbots. --- ## ChatGPT vs Bard: What’s the difference? Google Bard and ChatGPT are both large LLMs trained on huge datasets of text and code. But they aren’t exactly the same. Below, we break down some of the main differences between the two: ### 1\. User experience ChatGPT and Bard are easy to navigate and provide a user-friendly experience. Just tap away at your keyboard, feed them your questions, and that's it! They'll whip up answers for you within seconds. It's a straightforward process as the simplicity of typing in your prompts means it's almost impossible to mess up. Here is a side-by-side comparison of ChatGPT and Bard's opening screens: ![ChatGPT opening screen compared to Bard's opening screen](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/ChatGPT-vs-Bard-2-1.png) Chat GPT-4 opening screen (left) and Google Bard's opening screen (right) ### 2\. Accuracy Early users claim Bard provides more accurate information than its competitor, which relies on carefully crafted prompts to generate detailed responses. As you can imagine, having more accurate information can help you make better decisions. For example, if Bard is asked to provide information on a particular stock, it can access the latest news and research to provide a more accurate assessment of the stock's value. ### 3\. Relevance Bard shines when it comes to unearthing the right answers to your questions but it’s still a work in progress and will need to be fact-checked to ensure relevancy and accuracy. Bard is a time-saver and can pull together relevant pertinent articles, research papers, and resources to help you as and when needed. On the other hand, ChatGPT is more adept at crafting and summarizing text in a conversational manner. ### 4\. Training style A lot of people don’t realize that both AI chatbots have been trained with different ‘training styles.’ This is one of the biggest differences between the two. Bard uses a "learn by doing" method called self-supervised learning. On the flip side, ChatGPT goes the traditional route with supervised learning, where it learns from data that's been labeled by us humans. Here are some examples of how Bard learns by doing: - When a user asks a question - When a user asks Bard to complete a task - When Bard interacts with users Basically, Bard continues to learn new things about the world and how to communicate with people. It also learns new things about language, how to generate text, translate languages, write different kinds of creative content, and answer questions in an informative way. --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ## Can you use Bard in Google Sheets? Yes, you can use Bard in Google Sheets. Since Bard’s release, there’s been an increasing (and very vocal) demand for coding functionalities. The good news is [Google](https://blog.google/technology/ai/code-with-bard/#:~:text=Bard%20can%20also%20assist%20with,explain%20code%20snippets%20for%20you.) listened to its users and Bard can now help with all types of programming and software development tasks. Bard can not only help with code generation, debugging, and code explanation in more than 20 programming languages such as Python, Javascript, Typescript, and others, but it can also assist with writing functions for Google Sheets. --- ## How to use Bard with Google Sheets At the [Google I/O 2023 ](https://io.google/2023/)conference, the search giant did a deep dive session into the Bard AI chatbot and talked about how it can be used with Google Sheets and other products such as Gmail. You can watch the full video below (or skip ahead to 24:02 to learn more about using Bard with Google Sheets). In the presentation, the speaker showed an example of how you can ask Bard to arrange data into a table with rows and columns (screenshots below). Here is an example of that in action: ![Google Bard example from Google presentation](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/google-bard-and-finance.png) **Source: Google I/O 2023 conference presentation* Next, the speaker explained that you'll be able to export that data directly to Google Sheets with the click of a button (bottom right on the screen in the image below). ![How to export to sheets picture](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/bard-and-google-sheets.png) **Source: Google I/O 2023 conference presentation* Like clockwork, your data is suddenly organized in Sheets and you barely had to lift a finger. ![Bard and Google Sheets](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Google-bard-AI.png) **Source: Google I/O 2023 conference presentation* Of course, in finance, you’ll be working with a lot more complex data than comparing universities, but you get the idea. You'll also be able to access Bard directly in Sheets via Google’s new service, ‘[Duet AI for Workspace](https://workspace.google.com/blog/product-announcements/duet-ai)’. > "Our new '*help me organize'* capability in Sheets automatically creates custom plans for tasks, projects, or any activity that you want to track or manage — simply describe what you’re trying to accomplish, and Sheets generates a plan that helps you get organized. > "Whether you’re an event team planning an annual sales conference or a manager coordinating a team offsite, Duet AI helps you create organized plans with tools that give you a running start." - [Aparna Pappu, GM and Vice President, Google Workspace](https://workspace.google.com/blog/product-announcements/duet-ai) For Google Sheets, the presenter used a dog-walking business as an example for the keynote. However, you can easily use the same feature to help you automate tasks, analyze data, and even generate financial reports. Simply open a new sheet, type your request in the side panel on the right via the ‘Help me organize’ tab, and hit create (as shown in the image below from Google’s keynote): ![Google Sheets and Bard](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Bard-in-sheets.jpg) **Source: Google I/O 2023 conference presentation* The AI model is then able to figure out what you need based on your query or prompt. In the example shown in the presentation, Bard was able to generate the following data with more relevant details. ![Google Sheets and Google Bard](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/bard-in-finance.png) **Source: Google I/O 2023 conference presentation* --- ## How to use Bard with Excel While Bard isn’t integrated with Excel, you can still use it to help streamline and [automate Excel tasks](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/). For example, you can use Bard to help generate data for Excel spreadsheets. It can generate and/or analyze specific financial data such as revenue, expenses, or profit. You can perform simple operations like calculating the average of a range of cells or visualizing data with a chart or graph. Bard is also capable of executing more intricate analyses, including regression analysis or time series analysis. When it comes to data formatting, Bard shines again. You can use Bard to convert text to numbers, apply styles to cells, or create hyperlinks. More advanced formatting tasks, such as creating pivot tables or macros, are also within Bard's capabilities. Some other tasks you can use include updating formulas automatically, sending emails with attachments, creating reports, and even automating data entry or generating custom functions. These enhanced functionalities position Bard as a valuable asset if you’re a loyal Excel user, streamlining your workflow and boosting your efficiency. --- [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) --- ## Bard in Finance Here are some more examples of how you can use Google Bard in finance: ### Data entry Bard is cutting down hours of manual work by extracting data from documents and spreadsheets automatically. This is proving invaluable for [managing large datasets](https://www.financealliance.io/7-data-management-problems-and-solutions/), giving you that much-needed breather. ### Data analysis Bard is stepping into the shoes of an analyst by performing calculations and generating reports on the fly. It's helping finance professionals spot trends and patterns, ultimately leading to more informed decision-making. ### Financial forecasting Bard is playing the role of a financial soothsayer, [generating forecasts](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) based on historical data. This foresight is aiding professionals in planning for the future and making smarter investment choices. ### Risk management Bard is turning into a vigilant watchdog, identifying and assessing risks. This is empowering finance professionals to mitigate potential dangers and safeguard their company's assets more effectively. ### Create presentations Bard can create presentations that are clear, concise, and visually appealing. This can help you communicate financial information to stakeholders. ### Write financial documents Bard can write financial documents, such as budgets, forecasts, and financial statements. This can save you a lot of time and help them ensure that their documents are accurate and compliant. ### Compliance Lastly, Bard is serving as a compliance guide, ensuring that you're meeting all relevant regulations. This helps ensure that companies avoid potential fines and penalties, keeping their operations smooth and trouble-free. --- [What is finance transformation? | Finance AllianceIn this article, we’re diving into what finance transformation means, the key drivers of it, and why it’s something that needs to be on your radar in 2023 and beyond.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/what-is-finance-transformation.jpg)](https://www.financealliance.io/what-is-finance-transformation/) --- ## Bard vs ChatGPT: A case study We wanted to put the two AI giants to the test with a simple case study. So, we asked both [Bard and ChatGPT](https://www.aiacceleratorinstitute.com/chatgpt-vs-bard-what-are-the-top-key-differences/) the same question: > *“Write an in-depth financial report (cash flow statement) based on Netflix's latest quarterly earnings.”* With this prompt, we were able to perform a comparative analysis between the two AI chatbots to compare their responses to see which one provided a more accurate and contextually relevant answer. Here’s what ChatGPT churned out: As expected, ChatGPT let us know about its knowledge limits and the fact it can only access data up until September 2021\. However, it went on to guide us on how to write a cash flow statement report based on a company's quarterly earnings. It also provided blank spaces for us to fill in: ![ChatGPT vs Bard](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/ChatGPT-example1.png) Next, it was Bard’s turn. We asked Bard the same question and it not only provided an overview of Netflix’s quarterly earnings, but it also created an in-depth analysis, outlook, and further details on cash flow from operating activities to investing activities and more. ![Bard case study](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/BARD-EXAMPLE1.png) Here is the information Bard provided relating to sources of cash flow, as well as the numbers: ![Bard in finance case study](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/BARD-EXAMPLE-2.png) If ChatGPT remains restricted with its lack of internet access, it appears Bard has the upper hand when it comes to providing more in-depth and accurate information. With that being said, we've noticed ChatGPT has a more engaging tone and is able to be ‘more human’ when it comes to writing in general. --- ### How do I enable Bard on Google? 1. Go to the Google Search bar and type "Bard." 2. Select "Bard" from the list of results. 3. Click on the "Enable Bard" button. 4. You will be prompted to sign in to your Google account. 5. Once you have signed in, Bard will be enabled. ## Bard is now Gemini Google has updated Bard to [Gemini](https://www.financealliance.io/how-to-use-gemini-ai-with-google-sheets/), the latest edition of Google's AI model. Learn more about Gemini here: [How to use Gemini AI with Google SheetsGoogle’s latest breakthrough in artificial intelligence, Gemini, has many finance pros anticipating its transformative potential in data analysis and decision-making.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/how-to-use-google-gemini-with-google-sheets-2.jpg)](https://www.financealliance.io/how-to-use-gemini-ai-with-google-sheets/) --- ### FAQs: Google Bard How does Google Bard work? Bard is a large language model, also known as a conversational AI or chatbot trained to be informative and comprehensive. It's trained on a massive amount of text data, and can communicate and generate human-like text in response to a wide range of prompts and questions. Is Bard sentient? Despite what you might have heard, Bard is not sentient. Bard is a large language model, and isn't capable of feeling emotions or having its own thoughts. Can I use Google Bard for financial analysis? Yes, you can use Bard for financial analysis. It can help you with tasks such as researching stocks and investments, analyzing financial data, and generating financial reports. How much does Bard cost? Bard is free to use and accessible to everyone. --- ### Further reading: Learn about Microsoft 365 Copilot and Excel with this article: [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) Read all about Microsoft Fabric and how you can use it with Data Factory, Synapse Real-Time Analytics, and more here: [How to use Microsoft Fabric for data analyticsWith Microsoft Fabric, you can bridge the gap between data and intelligence and integrate all your data seamlessly. These tools have opened up new possibilities, setting the stage for a new era in finance AI.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Microsoft-fabric-1.jpg)](https://www.financealliance.io/microsoft-fabric-for-data-analytics/) Learn how to use ChatGPT with Excel here: [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) And finally, read all about how to use Copilot with Power BI here: [How to use Copilot in Power BIIn this article, we explore how you can leverage the power of Copilot in Power BI to help streamline your everyday processes within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/copilot-in-power-bi-2.jpg)](https://www.financealliance.io/copilot-in-power-bi/) --- ## Subscribe to The Monthly Balance newsletter👇 Stay up-to-date with the latest industry news, updates, blogs, reports, events, and more – all sent straight to your inbox each month. [**Subscribe to The Monthly Balance newsletter.**](https://www.financealliance.io/finance-newsletter/) [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### Managing Complex Change Matrix for CFOs URL: https://www.financealliance.io/managing-complex-change-matrix/ Last updated: 2025-09-15T08:48:22.000Z Managing complex change as a CFO can feel like a daunting task. After all, you're put in charge of leading your entire finance team through the organizational change. This involves handling not just the technical aspects, but also the human side, which is challenging since change often sparks resistance. This resistance isn't due to stubbornness or incompetence though, it’s usually a natural reaction to the uncertainty of new territory. So, it's important to communicate *why* change is necessary. You also need to highlight the benefits it’ll bring to your team and the organization. One tool that has proven helpful when leaders (and their teams) are faced with change is the **Lippitt-Knoster Model for Managing Complex Change Matrix**, which provides a clear framework for handling change. This article guides you through the matrix, introducing its origin, concepts, and techniques to help you manage and guide your team through complex change successfully. **Table of contents:** - [The Lippitt-Knoster Model for Managing Complex Change](https://www.financealliance.io/p/f56bf246-abdc-49ed-8516-17259cb8ccd5/#what-is-the-lippitt-knoster-model-for-managing-complex-change) - [Components of complex change](https://www.financealliance.io/p/f56bf246-abdc-49ed-8516-17259cb8ccd5/#what-are-the-components-of-complex-change) - [Types of organizational change defined as a complex change](https://www.financealliance.io/p/f56bf246-abdc-49ed-8516-17259cb8ccd5/#what-types-of-organizational-change-are-defined-as-complex-for-finance-teams) - [How to use the model for managing complex change](https://www.financealliance.io/p/f56bf246-abdc-49ed-8516-17259cb8ccd5/#how-to-use-the-lippitt-knoster-model-for-managing-complex-change) - [Consequences of poor implementation](https://www.financealliance.io/p/f56bf246-abdc-49ed-8516-17259cb8ccd5/#consequences-of-poor-implementation-of-change-management-components) ## **What is the Lippitt-Knoster Model for Managing Complex Change?** ![Lippitt-Knoster Model for Managing Complex Change](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/FA_Managing-Complex-Change-Model-1.png) Adapted from the Lippitt-Knoster Model for Managing Complex Change, 1987\. (Knoster model, 1991). The [Lippitt-Knoster Model for Managing Complex Change](https://sergiocaredda.eu/organisation/tools/models-the-lippitt-knoster-model-for-managing-complex-change/) is an acclaimed tool that has significantly shaped the field of change management. Developed by [**Dr. Mary Lippitt**](https://twitter.com/marylippitt) (and later adapted by [**Timothy Knoster**](https://www.bloomu.edu/people-directory/tim-knoster-edd-eds)), this model serves as a roadmap to navigate the winding paths of complex change. Timothy introduced his version of the model at the [TASH](https://tash.org) conference back in 1991\. Since then, it's become known as the '*Lippitt-Knoster model*,' which is how we'll refer to it in this article. Knoster is responsible for adding the extra element ‘consensus’ to the original matrix. The underlying rationale is that in many situations, leaders can't take the successful implementation of complex changes for granted without securing agreement and support from crucial stakeholders and team members who might be affected by these changes. ## **What are the components of complex change?** At the heart of the Lippitt-Knoster Model are six (*five original and one added by Knoster*) integral components: 1. **Vision:** The picture of the future state you wish to achieve. Your vision will act as the guiding light, providing direction to the change process. 2. **Consensus** *(Knoster's extra component)* **:** The collective agreement and support from all stakeholders involved in the change. Consensus ensures the change process is collaborative, reducing resistance and creating a sense of ownership. 3. **Skills:** The abilities and competencies required to implement the change. Skills ensure the team can convert the vision into reality. 4. **Incentives:** The motivators or rewards that encourage teams to embrace the change. Incentives can be intrinsic (like personal growth) or extrinsic (like bonuses). 5. **Resources:** These include the time, finances, personnel, and other assets necessary to support the change process. 6. **Action plan:** The detailed roadmap that outlines the steps to be taken to achieve the vision. It includes who does what, by when, and how. The brilliance of the Lippitt-Knoster Model lies in its emphasis on the simultaneous presence of all five elements for change to be effective. Each component is like a piece of a jigsaw puzzle; missing one can disrupt the entire picture. > *“Applying the model to coalitions takes vision, skills, incentives, resources, and an action plan to get a coalition to produce change in a community. If you have all five, you will likely end up with change. And, if you leave one of the components out, you will likely end up with something different.”* *Source:* [*The Managing Complex Change model, Dr. Mary Lippitt, founder and president of Enterprise Management, Ltd., 1987*](https://meyerfoundation.org/wp-content/uploads/2019/12/Managing-Complex-Change.pdf)*.* --- [Operational finance: A CFO’s guide to leadership stylesOperational finance is an essential aspect of a successful CFO’s skill set. But mastering the operational side alone isn’t enough. You also need to wear your strategic leadership hat too and learn to balance both for maximum impact. But how?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CFO-operational-finance.jpg)](https://www.financealliance.io/operational-finance/) --- ## **What types of organizational change are defined as complex for finance teams?** Organizational change is deemed 'complex' when it involves multiple dimensions of the organization, is intertwined with numerous factors, and when it prompts a significant shift in how the organization and its members operate. For a finance team, complex changes can include: ### 1\. Mergers and acquisitions These changes can significantly alter the financial structure and operations of a company. For the finance team, integrating financial systems, policies, and procedures can be a complex task. They'll need to manage due diligence, valuation, and integration processes while maintaining regular financial operations. ### 2\. Digital transformation Implementing new financial software, shifting to cloud-based systems, or integrating [artificial intelligence](https://www.aiacceleratorinstitute.com/your-guide-to-artificial-intelligence/) (AI) into financial processes are examples of [digital transformation](https://www.financealliance.io/your-guide-to-finance-transformation/). These changes can be disruptive, as they require the finance team to learn new skills and adapt to new ways of working. ### 3\. Restructuring Organizational restructuring can have significant implications for the finance team. Whether it involves downsizing, upsizing, or reshuffling of roles, it directly impacts the financial planning and budgeting within the company. ### 4\. Changes in financial regulations New regulations or changes in existing ones can have a considerable impact. Adapting to new reporting standards or tax laws, for instance, can be a complex process requiring substantial adjustments. --- [5 Pillars of CFO leadership | Finance AllianceCFO leadership isn’t just about flexing your financial muscles. It’s also about inspiring your team, adapting to change, and navigating complex challenges…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/cfo-leadership-pillars-2.jpg)](https://www.financealliance.io/cfo-leadership-pillars/) --- ### 5\. Shifts in strategic direction If a company decides to enter new markets, launch new products, or make major strategic changes, the finance team will be at the forefront of budgeting, financial planning, and investment analysis for these initiatives. In each of these scenarios, the team needs support from the CFO to effectively manage the change. According to a recent survey by [McKinsey](https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/our-insights/mastering-change-the-new-cfo-mandate): > “*Finance leaders are deeply involved in determining how businesses adapt to significant changes in how work gets done—particularly in places where digital and finance intersect*.” There are a few main reasons why you'll need to support your team during this time, such as: - **Skill gaps:** The team might need to acquire new skills or enhance existing ones to adapt to the change. - **Resistance to change:** As with any change, there can be resistance due to fear of the unknown or comfort with current practices. This resistance needs to be managed for successful change. - **Workload:** Complex changes often mean extra work on top of regular duties, which can lead to stress and burnout if not managed well. - **Uncertainty and risk:** Complex changes involve uncertainty and potential risks, especially financial ones, which need to be managed effectively. Using a model like the Lippitt-Knoster Managing Complex Change Model can provide a structured approach to [navigating these complex changes](https://www.financealliance.io/5-change-management-strategies-finance-transformation/), making the process more manageable and less stressful for the finance team. ## **How to use the Lippitt-Knoster model for managing complex change** As a CFO, you’ll often find yourself at the forefront of managing complex change within your organization. From mergers and acquisitions to digital transformation and strategic shifts, managing these changes can be a difficult task. However, having a structured approach can make this task significantly more manageable and effective. ![Managing complex change matrix](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-vvx7769z5u.png) As we discussed, this is where the Lippitt-Knoster Model can be used to help guide you through the process. Below, we’re diving into how you can use each of the components effectively: ### **Step one: Establish a clear vision** As a CFO, the initial step in managing complex change is to define your vision. Your vision should encompass the reasons why change is necessary and what goals you want to achieve because of the change. Think of it as your strategic blueprint, which will guide the subsequent steps. Here’s how you can put this into action: **1\. Define your vision:** Use your understanding of the organization's financial position and future direction to develop a vision that aligns with the company's overall strategic goals. **2\. Communicate your vision:** Use meetings, newsletters, emails, or one-on-one conversations to communicate this vision to your team and stakeholders. Address questions like, "*Why is this change needed?*" and "*What are the benefits of this change?*" **3\. Reinforce your vision:** Regularly revisit and reinforce the vision to keep it at the forefront of all change-related activities. ### **Step two: Building consensus** Consensus forms a critical part of managing complex change, particularly in a leadership role such as a CFO. It involves gaining widespread agreement and support for the change from all stakeholders involved. Here's how you can build consensus: **1\. Identify key stakeholders:** Determine who will be most impacted by the change. This could include your team, other departments, management, or even external partners. **2\. Invite feedback:** Encourage stakeholders to share their thoughts, concerns, and suggestions. This makes them feel valued and part of the change process, which leads to buy-in. **3\. Address concerns:** Address stakeholder concerns promptly and effectively. This might involve making adjustments to your plan or providing additional information to clarify misunderstandings. **4\. Regular updates:** Keep stakeholders informed about the progress of the change. Regular updates ensure that everyone remains aligned and any emerging issues are addressed promptly. --- [5 CFO change management strategies: finance transformationWith the right approach, you can effectively manage this resistance and bring your finance team into the modern age of digitalization and in this blog post, we’ll show you how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Change-management-strategies-for-cfos.jpg)](https://www.financealliance.io/5-change-management-strategies-finance-transformation/) --- ### **Step three: Identifying necessary skills** The next step is to identify the skills needed to execute your vision. You can approach this step by focusing on the following initiatives: **1\. Skill assessment:** Determine the skills your team currently possesses and the ones they'll need to acquire for the change. This might involve financial modeling for a merger or learning a new software tool for digital transformation. **2\. Training opportunities:** If gaps exist, plan for training opportunities. This could be internal workshops, online courses, or partnering with external training providers. Time for skill acquisition should also be factored into the change timeline to reduce anxiety and resistance. **3\. Support continuous learning:** Encourage a culture of continuous learning in your team. This not only helps in skill acquisition but also builds resilience to future changes. ### **Step four: Designing appropriate incentives** Incentives can significantly motivate your team to embrace change. To effectively use incentives: **1\. Understand motivations:** Each team member might be motivated by different things - some might value career progression, while others appreciate monetary rewards or recognition. **2\. Design incentives:** Based on these motivations, design a reward system. This could range from promotions and bonuses to public recognition or additional learning opportunities. **3\. Communicate incentives:** Clearly communicate how these incentives are tied to the change process. Ensure your team understands what rewards are available and how they can achieve them. ### **Step five: Gathering required resources** A lack of resources can lead to frustration and anxiety. To prevent this: **1\. Identify resources:** Determine what resources are needed for the change process like financial resources, additional personnel, equipment, etc. **2\. Bridge resource gaps:** If there's a gap between the required and available resources, devise a plan to bridge it. This might involve reallocating budgets, hiring temporary staff, or seeking external support. **3\. Communicate resource availability:** Ensure your team is aware of the resources available to them. This transparency can reduce anxiety and build confidence in the change process. ### **Step six: Creating an action plan** The final step in managing complex change is developing a clear action plan. Here's how you can do it: **1\. Develop a detailed plan:** Outline the steps to be taken to achieve your vision. This should include who does what, by when, and how. **2\. Share progress:** Regularly update your team and stakeholders on the progress of the change process. This keeps everyone aligned and informed. **3\. Define success:** Clearly define what success looks like. This will help your team understand the end goal and how their efforts contribute to it. Answering questions like, "*How will we know when we have reached our goal?*" can provide clarity and direction. --- [3 principles to lead with confidence through changeAs a finance leader, you need to learn how to lead through change with confidence & in this post, Stephen Newland, Director of FP&A, shares how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceStephen Newland, CMA![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/Finance-leader.jpg)](https://www.financealliance.io/3-principles-to-lead-with-confidence-through-change/) --- ## **Consequences of poor implementation of change management components** The Lippitt-Knoster Model is a powerful tool for understanding the components needed for successful change. However, just as it illuminates the path to success, it also highlights the pitfalls and challenges that can arise when any of these components aren't executed properly. By studying these negative outcomes — confusion, sabotage, anxiety, resistance, frustration, and false starts — we can better understand the importance of each component in the change management process. So, here's a breakdown of what happens when you miss the mark with any of the components: ### **Vision** ![managing complex change - vision](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-avu6pbew1z.png) If you have consensus, skills, incentives, resources, and an action plan, but lack a clear vision, the result will be confusion. The vision acts as the north star for your change process. Without it, there's no guiding light to steer your team, which leads to miscommunication and lots of confused looks shared around the room. > *Lack of Vision = Confusion* ### **Consensus** ![managing complex change - consensus](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-p25fgcx0iye.png) Without consensus, even if all other elements are in place, you risk sabotage. Consensus represents the collective agreement and support from stakeholders involved in the change. If key stakeholders don't buy in, they might openly or subtly work against the change, hindering its success. > *Lack of Consensus = Sabotage* ### **Skills** ![managing complex change - skills](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-yltb8pfddhn.png) If you have everything in place but your team lacks the necessary skills to implement the change, you'll face anxiety within the team. Unprepared team members can become apprehensive about failing, causing stress and potentially undermining the change efforts. > *Lack of Skills = Anxiety* ### **Incentives** ![managing complex change - incentives](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-esphbjen49.png) Incentives are crucial for maintaining motivation and engagement during the change process. If you have a vision, consensus, skills, resources, and an action plan, but fail to provide appropriate incentives, you'll likely encounter resistance. Without rewards or recognition, stakeholders may cling to old ways of doing things, slowing the change process considerably. > *Lack of Incentives = Resistance* ### **Resources** ![managing complex change - resources](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-jycka90o7lk.png) Resources are the fuel for the change process. You may have a solid plan and know how to accomplish it, but without the necessary resources, executing the change becomes an uphill battle. > *Lack of Resources = Frustration* ### **Action plan** ![managing complex change - action plan](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-1fzvu6v5esy.png) An action plan is a roadmap to achieving your vision. If you have a vision, consensus, skills, incentives, and resources, but no detailed action plan, you'll likely experience a situation akin to running on a "treadmill" — exerting effort without making progress. In the absence of a clear action plan, you may face repeated false starts, as you're unable to advance towards your goal effectively. > *Lack of an Action Plan = False Starts* --- ### FAQs: Managing Complex Change Model What is complex change? Complex change involves significant shifts in an organization's processes, systems, or culture, often occurring on multiple levels or areas simultaneously. It requires strategic planning, extensive communication, and careful management. How do you manage complex change? Managing complex change requires a clear vision, acquiring necessary skills, creating incentives, ensuring adequate resources, and developing a detailed action plan. Gaining consensus from stakeholders is also crucial. How can CFOs use the Lippitt-Knoster Model effectively? CFOs can use the model as a framework for planning and implementing change initiatives. Each element of the model serves as a critical consideration to ensure successful change. For instance, creating a clear vision, ensuring the team has necessary skills, providing incentives, allocating sufficient resources, and drafting a comprehensive action plan. Additionally, gaining consensus from stakeholders is crucial to ensure the change is accepted and implemented effectively. What are some common obstacles to successful change management according to the Lippitt-Knoster Model? Common obstacles often emerge from neglecting one or more components of the model. For instance, without a clear vision, the team can become confused. If there's no consensus, it could lead to sabotage. Lack of necessary skills can create anxiety, while missing incentives might cause resistance. Insufficient resources can lead to frustration, and without a solid action plan, the team might experience false starts or feel like they're stuck on a treadmill. How can I avoid negative outcomes in the change management process? Avoiding negative outcomes involves proactive planning and thorough implementation of all the components of the Lippitt-Knoster Model. Ensure there is a clear vision that is well communicated, equip your team with necessary skills, provide incentives, allocate sufficient resources, and create a detailed action plan. Moreover, gaining consensus from all stakeholders can help prevent resistance and sabotage. --- ### Join our free Slack community! The Finance Alliance community is the ultimate space for finance pros who want to accelerate their careers. Connect with our fellow finance leaders to network, discuss and share. Join now to be a part of the conversation. [Join our Slack community](https://www.financealliance.io/community/) [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### 9 common myths about FP&A roles URL: https://www.financealliance.io/9-common-myths-about-fp-a-roles/ Last updated: 2023-05-16T13:48:03.000Z Despite the importance of FP&A, there are many myths and misconceptions about FP&A that can lead to misunderstandings about the work that FP&A professionals do. Here are the top 9 myths about FP&A roles: ### Myth #1: FP&A is just about creating budgets While budgeting is certainly a key component of FP&A, it's far from the only thing that FP&A professionals do. In addition to creating budgets, [FP&A](https://www.financealliance.io/your-ultimate-guide-to-fp-a/) professionals are also responsible for analyzing and interpreting financial data, developing financial models and forecasts, and providing insights and recommendations to decision-makers. ### Myth #2: FP&A is only for finance professionals. While it's true that many FP&A professionals have a background in finance or accounting, this is not a requirement for the role. In fact, many FP&A professionals come from diverse backgrounds, such as economics, business, or even engineering. What is important for an [FP&A role](https://www.financealliance.io/breaking-into-fp-a-without-fp-a-experience/) is the ability to analyze and interpret financial data, understand business operations, and communicate effectively with decision-makers. --- [Your ultimate guide to FP&A | Finance AllianceWelcome to the complete guide to financial planning and analysis (FP&A), covering everything you need to know to become a pro at one of the most sought-after roles in finance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/FA_website_hub_meta_drivers_of_success.jpg)](https://www.financealliance.io/your-ultimate-guide-to-fp-a/) --- ### Myth #3: FP&A is a boring and mundane job While some aspects of FP&A work may be routine, the role can also be quite dynamic and challenging. FP&A professionals are often at the forefront of analyzing and interpreting financial data, which can inform important business decisions and strategies. As a result, they have the opportunity to make a meaningful impact on the direction and success of the organization. ### Myth #4: FP&A is all about numbers While there is certainly a lot of data and numbers involved in FP&A work, it's not all about the numbers. FP&A professionals must be able to interpret and understand the meaning and context behind the numbers and be able to communicate this effectively to decision-makers. This requires strong analytical skills, the ability to think critically and strategically, and good communication. ### Myth #5: FP&A is only about the past and present While FP&A does involve analyzing and understanding historical financial data, it is also about looking to the future. FP&A professionals are responsible for developing [financial forecasts and models](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/), which help to inform long-term planning and strategy. ### Myth #6: FP&A is only about cost-cutting While cost management is an essential aspect of FP&A, it is not the only focus of the role. FP&A professionals are also responsible for analyzing revenue and growth opportunities, and for identifying ways to optimize financial performance. ### Myth #7: FP&A is only for large organizations FP&A is a critical function for any organization, regardless of size. Small and medium-sized businesses also rely on FP&A to inform decision-making and strategy. And in fact, may even have a higher need for these services due to limited resources. --- [9 FP&A exit opportunities to consider | Finance AllianceConsidering FP&A exit opportunities? Whether you’re searching for your next big challenge or simply curious about what you can do with FP&A experience, this blog post is tailored just for you.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/FP-A-exit-opportunities.jpg)](https://www.financealliance.io/fp-a-exit-opportunities/) --- ### Myth #8: FP&A is a standalone function While FP&A does operate as a separate function within an organization, it is not completely isolated. FP&A professionals work closely with other departments and teams to understand and analyze financial data. They also provide insights and recommendations that support the overall goals of the organization. ### Myth #9: FP&A is a dead-end career FP&A is not a dead-end career. In fact, the skills and experience gained in an FP&A role can be highly valuable in a variety of different careers. Many FP&A professionals go on to pursue leadership roles within finance or other departments. --- ## Want to learn from FP&A experts? Attend our next virtual [FP&A Summit](https://fpasummit.financealliance.io/?%5Fgl=1%2A14adun8%2A%5Fga%2AODIzNzQwOTAxLjE2ODA5NDY3Mjk.%2A%5Fga%5F2NXFSBEP4N%2AMTY4NDI0MzIzNS4xNDQuMS4xNjg0MjQzOTYxLjAuMC4w ) and hear from some of the brightest minds in FP&A including world-class speakers and some well-known faces in finance. The next virtual FP&A Summit is on **June 15, 2023!** 🎓 Earn **CPE/CPD credits.** 🧠 Uncover the **latest industry trends** and **emerging technologies** to gain a competitive edge. 📱 **Collaborate, share ideas** and **connect** with 500+ fellow FP&A professionals. …did we mention it’s free to tune in live? All you have to do is register and you’re all set!👇 [Save your seat!](https://fpasummit.financealliance.io/?%5Fgl=1%2A14adun8%2A%5Fga%2AODIzNzQwOTAxLjE2ODA5NDY3Mjk.%2A%5Fga%5F2NXFSBEP4N%2AMTY4NDI0MzIzNS4xNDQuMS4xNjg0MjQzOTYxLjAuMC4w ) ### Storytelling with Data Visualization Playbook URL: https://www.financealliance.io/storytelling-with-data-visualization-playbook/ Last updated: 2025-04-10T06:45:23.000Z Are you tired of presenting financial data that falls flat? Frustrated that your insights are lost in a sea of numbers and charts? Worry no more! We've created the ultimate playbook to help you transform your financial data into captivating, persuasive stories. Discover the essential components of a powerful data narrative and learn how to weave them together to create a story that resonates with your audience. ### What's Inside? ✅ A step-by-step guide to crafting compelling data stories ✅ Financial data preparation and cleaning tips ✅ Expert tips on selecting the right graphs and charts ✅ Best practices for engaging presentations that inspire action ✅ How to build a persuasive argument with financial data ### Ready to transform the way you present financial data? With this playbook in your toolkit, you'll be well-equipped to turn raw data into actionable insights that drive real change. ## Want to improve your storytelling skills even more? Build the skills and expertise you need to take the step from ‘number cruncher’ to strategic business partner. Our certified ‘[Business Partnering & Storytelling](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters )’ course gives you immediate access to five hours of bite-sized video lessons, detailed slides for review, and a bunch of downloadable examples and cheat sheets to help you become the ultimate finance business partner and storyteller. With Christian Wattig (founder of FP&A Prep) as your coach, you’ll learn how to build and nurture relationships, provide insightful guidance to influence decisions, and turn complex data into compelling stories that inspire action. [Sign up](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) ### How can you add value in your organization as a FP&A professional? URL: https://www.financealliance.io/how-can-you-add-value-in-your-organization-as-a-fp-a-professional/ Last updated: 2025-04-07T10:12:09.000Z FP&A professionals play a vital role in the organization by helping to unlock the full potential of business with the help of key decision-making inputs backed by thorough research and data analysis. They not only help businesses make key decisions by analyzing the possible outcomes, but they also establish the annual budget and carry out regular [forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/) to keep businesses aware of [upcoming events](https://www.financealliance.io/top-finance-events/). ## How can an FP&A professional add value in the organization? The ultimate goal of any business is to generate wealth for its shareholders. The returns earned by shareholders is measured in terms of *Return on Equity (ROE).* > **ROE = Net profit/owner's equity.** FP&A professionals can add value in the organization by helping business to maximize the ROE. However, higher ROE is a by-product of improved net margins, efficient asset management, and financial leverage management. Therefore, ROE can also be expressed as a product of net profit margin, asset turnover, and financial leverage. In order to maximize the ROE in the business, one needs to bring improvement in all three aspects. ![ROE formulas](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-qbshz3m5zdn.png) ## How to improve net margins - **Increase the sales -** As an FP&A professional, one needs to find the optimum scalable sales mix which not only leads to growth in revenue but also gross margins. They should work closely to shorten the customer funnel cycle by identifying the key delay areas such as product non-availability, higher delivery lead time, etc. - **Optimize the cost -** FP&A professionals need to do a thorough analysis of fixed and variable cost drivers of the business and look for means of reducing the cost wherever possible and generating other investment income with close coordination with the treasury team. - **Benchmark -** FP&A professionals must do an industry trend analysis and compare it with their own business to find out the major delta in key margins such as gross profit, EBITDA, and net profit. This helps in identifying the areas of improvement in comparison to industry trends and building a roadmap to achieve the set improvement targets. --- [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) --- ## How to improve asset turnover Before diving deep into asset turnover improvement measures, let us first understand what asset turnover is Asset turnover indicates how much revenue a business generates on each $ invested in it. > **Asset turnover = Revenue/asset.** ### Improve working capital days gap Prime components of working capital in a business consist of inventory, receivables, and payables. Working capital days of a business can be derived by adding inventory and receivable days and subtracting payable days from them. > Working capital days = Inventory days + Receivable days - Payable days. In order to improve the working capital days gap, one can incentivize customers to make payments before due dates, negotiate with vendors for additional credit days, and opt for just in time inventory management model. ![inventory management model](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-m31098499vh.png) ### Efficient capital budgeting FP&A teams need to do capital budgeting and employ discounted cash flow, or internal rate of return methodology with anticipated cash flows to ensure that any investment in capex is generating positive returns for the business. However, there’s an exception to this rule, i.e. when the business is in its early stages, the fixed asset turnover may be lower due to high capex investment in the beginning, along with lower revenues. --- [How to transition from FP&A to CFO with Paul BarnhurstIn this episode of the podcast (and blog post) Paul Barnhurst, otherwise known as ‘The FP&A Guy,’ talks about how you can move from FP&A to CFO.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AlliancePaul Barnhurst (The FP&A Guy)![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Paul-Barnhurst-podcast-thumbnail.png)](https://www.financealliance.io/podcast/fp-a-to-cfo/) --- ## How to improve financial leverage Financial leverage is used to identify how much business is funded by the owner's capital and vice-versa. The usual approach for this is to find out **debt/equity**. However, a more holistic approach can be to find out the **total asset/equity**. Here, any source of funding not invested by owners is considered to find out financial leverage. E.g. the total asset of the company is $100 and equity is $80, so the financial leverage is $100/$80, which equals 1.25 times or 125%. Below are the measures to improve the financial leverage: ![High leverage and low leverage measures](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-td7gdpl7y5m.png) ## Increase total asset The financial leverage can be increased by the addition of assets of the business without infusing the additional owner's equity. However, here, the impact of increasing total assets works against our strategy if the business is not able to generate incremental revenue on the additional asset introduced, and gets canceled with the asset turnover. E.g. certain growth projects may require heavy investments which may not be available with the company as equity. In this case, the company can use the leverage with the matching tenure of the project, resulting in higher revenue with the same equity, and higher ROE. Also, it saves the business from diluting its equity. ![Equations](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-ter8711wd3a.png) ### Decrease owner's equity In case the organization is not able to generate any additional revenue with its available capital, it should consider returning its equity capital back to shareholders in the form of buyback, bonus issue, or dividends. A lower equity base leads to higher financial leverage and results in a higher return on equity, e.g. if a business earns $10 on its $100 equity, then the ROE is 10%. However, if the earning remains the same but the owner's equity becomes $50, then ROE doubles to 20%. --- ## Want to learn from FP&A experts? Attend our next virtual [FP&A Summit](https://fpasummit.financealliance.io/?%5Fgl=1%2A14adun8%2A%5Fga%2AODIzNzQwOTAxLjE2ODA5NDY3Mjk.%2A%5Fga%5F2NXFSBEP4N%2AMTY4NDI0MzIzNS4xNDQuMS4xNjg0MjQzOTYxLjAuMC4w ) and hear from some of the brightest minds in FP&A including world-class speakers and some well-known faces in finance. The next virtual FP&A Summit is on **June 15, 2023!** 🎓 Earn **CPE/CPD credits.** 🧠 Uncover the **latest industry trends** and **emerging technologies** to gain a competitive edge. 📱 **Collaborate, share ideas** and **connect** with 500+ fellow FP&A professionals. …did we mention it’s free to tune in live? All you have to do is register and you’re all set!👇 [Save your seat!](https://fpasummit.financealliance.io/?%5Fgl=1%2A14adun8%2A%5Fga%2AODIzNzQwOTAxLjE2ODA5NDY3Mjk.%2A%5Fga%5F2NXFSBEP4N%2AMTY4NDI0MzIzNS4xNDQuMS4xNjg0MjQzOTYxLjAuMC4w ) [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg)](https://www.financealliance.io/community/) ### How to transition from FP&A to CFO URL: https://www.financealliance.io/podcast/fp-a-to-cfo/ Last updated: 2025-04-07T10:12:29.000Z Thinking about making the move from FP&A to CFO? Well, you’re not alone. [Deloitte](https://www2.deloitte.com/content/dam/Deloitte/us/Documents/finance/us-cfo-signals-2q18-full-report.pdf) reports that 47% of CFOs had experience in FP&A before they transitioned to the top executive role… and you can too. In this episode of the Two Cents: Finance Talk podcast, we had the pleasure of speaking with [Paul Barnhurst](https://www.linkedin.com/in/TheFPandAGuy/), otherwise known as ‘The FP&A Guy.’ We talked about what it takes for an FP&A professional to become a Chief Financial Officer, covering topics such as: - [Can you transition from FP&A to CFO?](https://www.financealliance.io/p/3a77d43c-09e2-4244-a5d0-6943d51b2a3a/#can-you-transition-from-fpa-to-cfo) - [Communication tips](https://www.financealliance.io/p/3a77d43c-09e2-4244-a5d0-6943d51b2a3a/#improving-your-communication-skills-to-help-move-from-fpa-to-cfo) - [How FP&A professionals can get more involved in strategic discussions](https://www.financealliance.io/p/3a77d43c-09e2-4244-a5d0-6943d51b2a3a/#how-fpa-professionals-can-get-more-involved-in-strategic-decisions) - [How to demonstrate leadership skills](https://www.financealliance.io/p/3a77d43c-09e2-4244-a5d0-6943d51b2a3a/#how-to-demonstrate-leadership-skills-as-an-fpa-professional) - [How CFOs can help to standardize data](https://www.financealliance.io/p/3a77d43c-09e2-4244-a5d0-6943d51b2a3a/#how-cfos-can-help-to-standardize-data) - [Reducing non-value add activities ](https://www.financealliance.io/p/3a77d43c-09e2-4244-a5d0-6943d51b2a3a/#reducing-non-value-add-activities-in-fpa) - [Top tips to get closer to the C-Suite](https://www.financealliance.io/p/3a77d43c-09e2-4244-a5d0-6943d51b2a3a/#3-top-tips-to-help-you-transition-from-fpa-to-cfo) You can listen to Paul’s episode below, or keep reading for Paul’s insights in his own words: ## Can you transition from FP&A to CFO? The ability for FP&A to transition to the role of CFO is completely possible. You're seeing more and more people from FP&A transition to the role of CFO (or to the position of a [virtual CFO](https://www.financealliance.io/how-to-become-a-virtual-cfo/) or [fractional CFO](https://www.financealliance.io/how-to-become-a-fractional-cfo/)). One of the software vendors out there recently did a study showing that more and more CFOs today are coming through FP&A versus the traditional way. The vast majority came through controllership. Governance used to be key, and it was all about keeping people out of trouble and making sure the books were right. Today, the modern CFO is much more about data and commercials and really helping create value for the business. And because FP&A is one of the few organizations that's cross-functional, has a holistic view of the entire business, and works with every part of it, they're well positioned. At the same time, you need more than just FP&A experience. You need to be well-rounded in finance. There’s one person I really like, Jeff Marks. His company uses something they call the ‘finance passport.’ He says that if you want to be a CFO, you need to be a finance specialist. A specialist is like an athlete, where you do multiple different things. You’ve got to punch different parts of that passport. It doesn't mean you have to be in all those roles, but you need projects that show you can demonstrate and lead a group that matches those things, from audit to tax, to accounting, to FP&A, to treasury. --- [The future of FP&A: How the FP&A role is evolvingThe role of FP&A is transforming before our very eyes, and it’s high time we explored why. In this post, we’re diving into the FP&A journey, analyzing its dynamic evolution, and mapping the road ahead.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/FA-Infographics-Meta_Past_v_Future_FP-A.jpg)](https://www.financealliance.io/future-of-fp-a/) --- ## Improving your communication skills to help move from FP&A to CFO To improve your communication, I think the biggest thing is practice. One person who speaks a lot about it on LinkedIn and is a fabulous presenter is Carl Seidman. He often talks about all the practice he’s put in. He used to be part of a comedy group, he did Toastmasters, and now he's part of a national speaking club. He even had a voice coach at one point. He made a complete commitment to learn how to be able to command a room, and he’s put in hundreds of hours. So, communication, whether written, verbal or whatever method it may be, really comes down to deliberate practice to get good at it. ## How FP&A professionals can get more involved in strategic decisions To go from FP&A to CFO, you need to be more strategic and there are a couple of things that go into becoming more strategic. First, you’ve got to know the business. For a long time, FP&A was viewed as what I call FP&R, Financial Planning and Reporting. For example, here's this 100-page deck that nobody will read which will end up in the round file basket. Now you're seeing much more. It's about knowing the business and discussing commercials. --- [10 CFO personality traits to go down in history | Finance AllianceWhat are the most important Chief Financial Officer (CFO) personality traits? And what type of person makes a good CFO? In this post, we reveal the top 10 qualities of a good CFO to go down as one of the strongest finance leaders in history.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/CFO-personality-traits.jpg)](https://www.financealliance.io/10-cfo-personality-traits/) --- I remember one time knowing I'd really made an impact in the business when I was sitting in a meeting with our product team. We were working through some new pricing, and they turned to me and asked, well, what *should* the price be? I tried to look at it strategically, but my response was: > “*Here's what it needs to be from a margin perspective. But ultimately, setting the price should be the responsibility of product, the marketing, and the sales team. With finance, I'll give my input, but you guys need to decide what the market can bear here*.” …and so that was a strategic discussion. We got to the point where I had that seat at the table, and we were working together. But the only way that happened was because I took the time to *learn* the business. That's the biggest piece of advice I can give. > If you want to be involved in strategic discussions, make sure of two things. One, that you've learned the business, and two, that you're providing value and support to the leaders of your organization. You're not focusing on finance needs, you're focusing on *business* needs. ## How to demonstrate leadership skills as an FP&A professional At the end of the day, whether it's finance or an [FP&A](https://www.financealliance.io/your-ultimate-guide-to-fp-a/) role, if you want to be a senior leader, you must demonstrate leadership. That can be done in different ways. There's a manager, and there's a leader. I've been in roles where I've had a manager, but I’ve had my CFO telling me, “*You're the leader of this group right now, even though you have a manager*.” And in time, I ended up becoming the manager as well. Demonstrating leadership comes from working to take control of situations and being proactive. By taking control, I don't mean going in and saying, “*Hey, I'm in charge, I'm going to run this*.” Instead, it’s showing you can help guide and move it forward and influence it regardless of whether you're the one officially in charge. There are a lot of ways you can do that. Volunteering for assignments is always a great way when you don't have any leadership experience. I had someone on my podcast called John Laudie, who's now a CFO. He wanted to get some leadership experience, but there just weren't enough people on the team. So, he proposed a program to bring in some college interns for the summer, and he managed both the program and the interns. It was low cost, high value, and it gave him some really good [CFO leadership](https://www.financealliance.io/cfo-leadership-pillars/) experience. And then when a position came up to manage a team, he ended up getting the position. So sometimes you need to be creative and think of different ways to get experience, even outside of work. For example, you could volunteer to be part of different leadership organizations during school. There are lots of ways you can demonstrate that. --- [5 Pillars of CFO leadership | Finance AllianceCFO leadership isn’t just about flexing your financial muscles. It’s also about inspiring your team, adapting to change, and navigating complex challenges…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/cfo-leadership-pillars-2.jpg)](https://www.financealliance.io/cfo-leadership-pillars/) --- ## How CFOs can help to standardize data CFOs are the ones who are mostly responsible for implementing new technologies in the business, and this is certainly something you can get more involved with to help go from FP&A to CFO. The reality is that more CFOs are putting the analytics and the data teams under them. In the last job I had, we got a new CFO, and one of the very first things he did was stick analytics under him and get involved in the system side. We were working on a [CFO transformation](https://www.financealliance.io/5-change-management-strategies-finance-transformation/) and bringing in CPQ, configure, procure, and quote tools. And he immediately asked, “*How do we move this forward? How do we get this done quicker?*” He brought in a new person to manage the analytics and the operations, and you could see it was very data focused. So, you're seeing a big push by CFOs because what's one of the few organizations that sees the data across the entire business? It's finance. And often they should be the ones calculating those metrics so they’re standard. One huge problem is something I dealt with a lot in my last role. I was helping to standardize all our definitions for metrics. I went to marketing and asked how they defined churn. “*Well, we're doing it this way*.” In finance, we were doing it another way. Then you went over to the sales ops person, and they were doing it a completely different way as well. And then the CFO says, “I want to see it *this* way.” Every number is different. So that's the worst place to be for a leader, to sit in a meeting and spend the first 45 minutes arguing over the data and how it should be defined. And so, the more a CFO can help with that transformation and push to ensure that systems speak together, and the data is standardized, the better. --- [How FP&A evolves & fits within a scalable growth strategyIn the episode, we explored how FP&A evolves and fits within a scalable growth strategy. Jeffrey shared his expertise on the subject, revealing practical insights on how small businesses can use FP&A as part of a scalable business model.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Jeff-blog-image-podcast.png)](https://www.financealliance.io/podcast/scalable-growth-strategy/) --- ## Reducing non-value add activities in FP&A We’re really in a golden age of software tools. I've talked to around 60 CEOs in the last year. Since I started doing this in the last 14 months, I’ve also demoed 60-70 tools. I talk to a CEO every week, around someone who's built a software tool. The opportunity to use a tool is better than ever. And despite that, there are still times that [Excel](https://www.financealliance.io/chatgpt-for-excel/) or Google Sheets, depending on the size and complexity of the business, may make sense. But as companies start to scale, they deal with some real challenges such as collaboration, security, and data integration, which a tool such as a spreadsheet can't solve very well because they're not an enterprise platform. An FP&A tool is great because it can help with collaboration, bringing in all that data, and helping a business automate a lot of things. The reality is that most finance people spend 50-70% of their time on non-value add activities. Those types of things aren’t what they want to be doing and don't help them to be strategic and a senior leader, but they have to be done. So, tools will continue to play a big role in making it so that you don't have to spend as much time on the non-value add activities, and you can focus on gaining insight from the data. ## 3 top tips to help you transition from FP&A to CFO There are three key things that FP&A professionals can start doing now in their roles to help them get closer to a C-suite position. The biggest thing is to learn the business. The second is to add value to the senior leaders. Make sure you're meeting their needs. And the third thing is to be willing to speak up and speak about more than just financial issues. Speak up about strategic things in the business. Don't take over conversations, but make sure you can add value and your voice can be heard because people will notice that. And when you start adding value, more opportunities will become open to you, and your career can grow from there. --- ### **FAQs: FP&A to CFO** Can FP&A lead to CFO? FP&A serves as a solid foundation for pursuing a CFO role, providing crucial experience in financial planning, analysis, and forecasting. Although it's not the exclusive route, it equips you with an in-depth understanding of a company's financial well-being and strategic decision-making, which are vital for a CFO. Broadening your experience and showcasing leadership skills can significantly improve your prospects of progressing to a CFO position. Can I become a CFO without an MBA? Yes, you can become a CFO without an MBA, but having one can enhance your career prospects. Pursuing a relevant master's degree, such as an MBA or a Master's in Finance, can help you gain valuable skills, demonstrate your commitment to the field, and expand your professional network. What skills do I need to transition from FP&A to CFO? To transition from FP&A to CFO, you'll need to develop skills in strategic planning, financial management, risk assessment, leadership, communication, and understanding regulatory compliance. It's essential to gain experience across various finance functions and build a broad business perspective. Can a Financial Analyst become a CFO? Yes, a Financial Analyst can become a CFO. It's important to gain experience in various finance roles, including FP&A, and develop a broad range of skills in strategic planning, financial management, and leadership. Demonstrating your ability to think strategically and contribute to a company's overall growth will help you progress towards a CFO position. --- ### ### The future of FP&A: How the FP&A role is evolving URL: https://www.financealliance.io/future-of-fp-a/ Last updated: 2025-04-07T10:12:45.000Z The role of FP&A is transforming before our very eyes, and it's high time we explored *why*. In this post, we're diving into the FP&A journey, analyzing its dynamic evolution, and mapping the road ahead. Here's what's on the agenda: - [The FP&A role of the past](https://www.financealliance.io/p/326e4c9b-7f67-4b7b-b392-7f92b5c5c895/#the-fpa-role-of-the-past) - [The future of the FP&A role](https://www.financealliance.io/p/326e4c9b-7f67-4b7b-b392-7f92b5c5c895/#the-future-of-the-fpa-role) - [Three key building blocks for the future of FP&A](https://www.financealliance.io/p/326e4c9b-7f67-4b7b-b392-7f92b5c5c895/#3-key-building-blocks-shaping-the-future-of-fpa) ![Future of FP&A - Past vs Future of the FP&A role](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/FA-Infographics-Square_Past_v_Future_FP-A.png) ## The FP&A role of the past ### Manual data processing Think back to when FP&A professionals were knee-deep in manual data processing. Remember those never-ending hours of data collection and processing? Even the most diligent among us couldn't entirely avoid the odd mistake making its way into our reports. According to [Datarails research](https://www.datarails.com/fpa-economic-role/), **96,000** hours were wasted on manual FP&A tasks (*based on a conservative estimate of two hours per week of manual work by those surveyed*). Manual data processing is a painstaking process, to say the least, and made it challenging to provide timely and accurate data when needed. ### Limited software tools Not too long ago, FP&A teams had to work with a limited selection of software tools. Admittedly, we still have a soft spot for old-fashioned spreadsheets, but those tools often fell short when it came to some of the advanced capabilities seen in today's software. Hindered by these limitations, FP&A professionals grappled with mountains of manual tasks and struggled to deliver crucial insights for [strategic planning](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/). ### Focus on historical data FP&A roles were once all about diving deep into historical data to make sense of past performance and spot trends. While the info was useful, it didn't necessarily give us a crystal-clear view of what lay ahead. By fixating on past data, we found ourselves somewhat blindsided by changes in the business landscape or industry trends. ### Siloed decision-making FP&A professionals often worked solo, with minimal interaction across departments. This "lone wolf" approach led to limited shared understanding, making it tricky for teams to coordinate and work towards common goals. As a result, decision-making took its sweet time, causing organizations to miss out on opportunities for growth and expansion. ### Reactive analysis FP&A roles used to be more reactive, diving into data and providing insights after the fact. This approach made companies sluggish in adapting and hampered their ability to pounce on opportunities or mitigate risks swiftly. With a focus on reactive analysis, FP&A teams faced an uphill battle in helping companies maintain a proactive stance. --- [The finance function of the future: Transform or perishFrom digital disruption to economic uncertainties, the finance industry is facing a veritable storm of change. It’s a sink-or-swim moment, and only those who can adapt will make it to the other side.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/future-of-the-finance-function.jpg)](https://www.financealliance.io/the-finance-function-of-the-future/) --- ## The future of the FP&A role ### Automated data analysis PWC carried out an [FP&A survey](https://www.pwc.com/us/en/services/consulting/business-transformation/finance-transformation/financial-planning-analytics.html) and found that **60%** of FP&A data requires manual data manipulation while upwards of **80%** of FP&A tasks are somewhat or significantly done in offline databases and spreadsheets. Thankfully, this is set to change *very* soon because, in the not-too-distant future, FP&A teams will tap into the power of automation to supercharge data analysis. Thanks to automating data collection and processing, FP&A professionals can focus on what they do best: delivering top-notch insights and strategic recommendations. This exciting automation revolution promises to boost efficiency and take the quality of analysis to new heights. ### Advanced software and AI Get ready for cutting-edge software solutions and [artificial intelligence](https://www.aiacceleratorinstitute.com/your-guide-to-artificial-intelligence/) (AI) to take center stage in the FP&A world. These trailblazing technologies will arm FP&A teams with formidable tools to analyze massive datasets, identify patterns, and generate predictive insights. We're already seeing more FP&A teams embracing AI such as learning to use [ChatGPT for Excel](https://www.financealliance.io/chatgpt-for-excel/) and implementing [Microsoft's Copilot in Excel](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/). As FP&A pros continue to harness the power of advanced software and AI, they'll unlock unparalleled levels of accuracy and detail in their analysis. The result? Organizations make data-driven decisions with newfound confidence. ### Real-time data insights Soon, FP&A teams will be embracing real-time data insights, paving the way for faster and better-informed decision-making. With access to up-to-the-minute information, FP&A professionals can keep a watchful eye on performance and tweak forecasts as needed ([rolling forecasts](https://www.financealliance.io/rolling-forecast-best-practices/)). Real-time data insights will enable FP&A teams to be nimbler and more proactive, ultimately fueling strategic growth and boosting their competitive edge. ### Collaborative decision-making The future of the FP&A role will have collaboration and cross-functional teamwork at its core. By breaking down the silos that once stifled knowledge-sharing and insights, FP&A teams can better align strategies and ensure stakeholders have the intel they need for informed decision-making. This teamwork-driven approach will foster a more unified and agile organization, one that's well-prepared to conquer challenges and grab opportunities with both hands. ### Proactive and strategic planning FP&A's future is all about transitioning from reactive to proactive and strategic planning. By wielding advanced tools, automation, and real-time data insights, FP&A teams can: - Anticipate changes in the business landscape - Pinpoint opportunities - Craft contingency plans This forward-thinking mentality will empower organizations to make strategic decisions and stay ahead of the curve in an ever-competitive market. --- [9 FP&A exit opportunities to consider | Finance AllianceConsidering FP&A exit opportunities? Whether you’re searching for your next big challenge or simply curious about what you can do with FP&A experience, this blog post is tailored just for you.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/FP-A-exit-opportunities.jpg)](https://www.financealliance.io/fp-a-exit-opportunities/) --- ## 3 key building blocks shaping the future of FP&A Here are three critical elements molding the future of FP&A: ### 1\. Digital transformation: FP&A's brave new world The business landscape is being revolutionized by digital transformation, and FP&A is riding that wave. As organizations welcome digital transformation with open arms, FP&A teams need to stay on their toes, adapting to novel technologies and processes to remain relevant and valuable. The influence of [finance digital transformation](https://www.financealliance.io/how-finance-digital-transformation-impact-company/) on FP&A encompasses the integration of cutting-edge software, AI, automation, and real-time data analysis. By embracing digital transformation, FP&A pros can boost efficiency, sharpen accuracy, and provide more strategic insights for better decision-making. ### 2\. Unleashing the power of data: FP&A's growth accelerator Data is the beating heart of contemporary organizations, and mastering its power is key for FP&A's future. To wield data, FP&A teams must excel at gathering, managing, and analyzing vast volumes of information from diverse sources. This demands the cultivation of new skill sets, such as data visualization, data mining, and statistical analysis. By honing these skills and deploying the right tools, FP&A can transform raw data into actionable insights that inform strategic decisions and propel business growth. ### 3\. Analytics: The secret sauce for informed decisions Analytics will take center stage in the future of FP&A, empowering teams to extract meaningful insights from intricate data and guide better decision-making. Advanced analytics techniques, like predictive analytics, [machine learning](https://www.financealliance.io/fpa-machine-learning/), and artificial intelligence, enable FP&A teams to spot trends, reveal hidden patterns, and forecast future performance. By harnessing these formidable analytics tools, FP&A professionals can offer organizations a deeper comprehension of their financial performance, pinpoint opportunities and risks, and deliver data-driven recommendations to back strategic initiatives. --- *Liked this article? Why not download it in eBook format, so you'll always have these insights at your fingertips? 👇* [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/10/past-banner-image.png) ](https://productmarketingall.typeform.com/to/C4nuKert) --- ### FAQs: Future of FP&A How has the FP&A role evolved from its past to the future? In the past, FP&A roles focused on manual data processing, limited software tools, historical data analysis, siloed decision-making, and reactive analysis. The future FP&A role involves automated data analysis, advanced software & AI, real-time data insights, collaborative decision-making, and proactive & strategic planning. How will automation benefit the future FP&A role? Automation will streamline data analysis, reduce time spent on manual tasks, and minimize the risk of errors. This will allow FP&A professionals to focus on delivering valuable insights and strategic recommendations, ultimately improving efficiency and the quality of analysis.. What are the different FP&A roles? Different FP&A roles include FP&A analysts, who focus on data analysis and forecasting; FP&A managers, who oversee the FP&A team and coordinate with other departments; and FP&A directors, who develop strategic financial plans, manage budgeting processes, and ensure alignment with overall business objectives. What are the areas within FP&A? Key areas within FP&A include budgeting and forecasting, financial modeling, performance management, strategic planning, and risk assessment. These areas contribute to the overall goal of informing and driving data-driven business decisions, optimizing financial performance, and achieving long-term growth. --- ### Ready to level up your FP&A game? Don't miss the FP&A Summit! Join us at the FP&A Summit and propel your FP&A function into the future. 🗓 Mark your calendar: June 15, 2023 📍 It's virtual, so you can attend from anywhere! ### Why should you attend? 🎓 Earn those valuable **CPE/CPD credits.** 🧠 Discover the **latest industry trends** and emerging **technologies** to give you that **competitive edge.** 📱 **Collaborate**, exchange ideas, and **connect** with 500+ fellow finance professionals just like you. [Register for free 🚀](https://fpasummit.financealliance.io/?%5Fgl=1%2Axl4lbo%2A%5Fga%2AODIzNzQwOTAxLjE2ODA5NDY3Mjk.%2A%5Fga%5F2NXFSBEP4N%2AMTY4MzU1NjQyNC4xMTEuMS4xNjgzNTU3NTc0LjAuMC4w) ### Do you need a CPA to be a Chief Financial Officer (CFO)? URL: https://www.financealliance.io/cfo-vs-cpa/ Last updated: 2026-03-11T11:42:58.000Z CFO vs CPA: What’s the difference? Whilst the two share some similarities, they aren’t the same. You see, being a proficient Certified Public Accountant (CPA) doesn't automatically mean you're destined for the role of a Chief Financial Officer (CFO). And guess what? That's perfectly fine! There's no rulebook saying you *must* be a CPA to excel as a CFO. Likewise, CPAs don't have to chase the corporate finance dream if it's not their cup of tea. In this blog post, we clear up the confusion between CFOs and CPAs and explore whether you need a CPA to become a successful CFO (*spoiler - you don't!*). - [What is a CFO?](https://www.financealliance.io/p/5383a073-edf7-4113-b33a-8a072d0d020e/#what-is-a-cfo) - [What is a CPA?](https://www.financealliance.io/p/5383a073-edf7-4113-b33a-8a072d0d020e/#what-is-a-cpa) - [Differences between CFOs and CPAs](https://www.financealliance.io/p/5383a073-edf7-4113-b33a-8a072d0d020e/#what%E2%80%99s-the-difference-between-a-cfo-vs-cpa) - [Do you need a CPA to be a CFO?](https://www.financealliance.io/p/5383a073-edf7-4113-b33a-8a072d0d020e/#do-you-need-a-cpa-to-be-a-cfo) - [How to become a CFO without a CPA](https://www.financealliance.io/p/5383a073-edf7-4113-b33a-8a072d0d020e/#how-to-become-a-cfo-without-a-cpa) ## **What is a CFO?** A CFO is a top-level executive responsible for shaping the financial strategy and ensuring the business stays on the right track (financially speaking). They juggle a range of responsibilities including [financial planning](https://www.financealliance.io/financial-planning-in-uncertain-times-advice-from-leading-finance-experts/), risk management, and financial reporting. Using their insights and financial expertise, they play a huge part in supporting the company’s growth by making data-driven decisions. CFOs are highly collaborative and must be team players since they’ll join forces with fellow C-Suite members to set strategic goals and allocate resources. And they're not shy about sharing their company's financial performance with stakeholders, making sure everyone is kept in the loop. ## **What is a CPA?** A Certified Public Accountant (CPA) is a professional designation awarded when you pass the Uniform CPA Examination. CPAs know the ins and outs of accounting, auditing, taxation, and financial reporting. These important skills make them incredibly useful in sectors such as public accounting firms and government agencies. When it comes to accurate financial records, preparing and filing tax returns, conducting audits, and dishing out financial advice, CPAs have got you covered. An often overlooked part of the role is the fact that CPAs are held to incredibly high ethical standards. They must adhere to a strict code of professional conduct, ensuring trust and credibility in their work. --- [CFO and CEO relationship: 5 ways a CFO can support the CEOIn this post, you’ll learn what a CEO needs from their CFO, and what you can do to support the CEO on a day-to-day basis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/handshake-g5cf73343d_1920-1.png)](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/) --- ## **What’s the difference between a CFO vs CPA?** While both roles are vital, CPAs and CFOs have distinct responsibilities and areas of expertise. So, let's dive into the three main differences to get a better understanding of how these finance gurus differ: ### **1\. Tax strategy vs financial strategy** When it comes to tax strategy, CPAs are the first in line to take charge. With their in-depth knowledge of tax laws and regulations, they help businesses remain compliant. They also identify tax deductions, credits, and other opportunities to reduce a company's tax liability. For instance, a CPA might recommend a specific depreciation method for a business asset to maximize tax benefits over time. On the other hand, CFOs are all about shaping and implementing the broader financial strategy of a business. They take a holistic approach, focusing on the company's overall financial health and growth. This includes activities like financial planning, budgeting, and [forecasting](https://www.financealliance.io/top-down-vs-bottom-up-forecasting/), as well as managing risk and ensuring the business remains profitable. A CFO might, for example, recommend a merger or acquisition to achieve long-term growth goals. ### **2\. Expertise in tax strategy vs long-term organizational strategy** While both CPAs and CFOs have financial expertise, their focus areas differ. CPAs are experts in tax strategy, which means they're well-versed in tax laws and can help businesses navigate complex tax situations. They focus on the books and provide guidance on tax compliance and tax planning. Some CPAs even represent clients before tax authorities during audits or disputes. CFOs, however, concentrate on the long-term strategy of the organization. They analyze financial data, identify trends, and make strategic recommendations to support the company's growth and sustainability. For example, a CFO might identify a new market opportunity and suggest reallocating resources to capitalize on it, helping to increase profitability. ### **3\. Fundraising and capital structure** One key area where CFOs excel is fundraising and managing the capital structure of a company. They're responsible for securing the necessary funds to fuel the company’s growth, which might involve debt financing, equity financing, or a combination of both. CFOs can help businesses: - Decide on the right mix of debt and equity - Negotiate terms with lenders and investors - Manage the overall capital structure to minimize risk and optimize returns --- [Operational finance: A CFO’s guide to leadership stylesOperational finance is an essential aspect of a successful CFO’s skill set. But mastering the operational side alone isn’t enough. You also need to wear your strategic leadership hat too and learn to balance both for maximum impact. But how?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CFO-operational-finance.jpg)](https://www.financealliance.io/operational-finance/) --- ## **Do you need a CPA to be a CFO?** The short answer is no, you don't need to be a CPA to become a successful CFO. While having a CPA designation can be beneficial in some cases, it’s not a prerequisite for the role of a Chief Financial Officer. A strong background in finance, combined with strategic thinking and leadership skills, is typically more important for a CFO than a specific accounting certification. That being said, some CFOs do hold a CPA designation. According to the Journal of Accountancy,[ 44% of CFOs are CPAs](https://www.journalofaccountancy.com/news/2022/jan/diversity-rises-cfos-ceos-crist-kolder-report.html#:~:text=44%25%20of%20CFOs%20are%20CPAs,are%20both%20CPAs%20and%20MBAs%29.). Plus, a CPA background can provide a solid foundation in accounting principles and tax laws, helping you navigate complex financial situations and make well-informed decisions as a CFO. Another benefit of having a CPA is the impact it’ll have on the executive team. With a CPA on board, it can enhance a company's credibility in the eyes of stakeholders, such as investors and board members. Ultimately, the qualifications and skills required for a CFO role will depend on the specific needs and expectations of the organization. While a CPA designation can be a valuable addition to a CFO's skill set, you can become a CFO without a CPA. ![CFO vs CPA - image of a calculator](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/CPA-vs-CFO-1.jpg) ## **How to become a CFO without a CPA** Becoming a CFO without a CPA is definitely possible and here are some tips to help you do it: ### 1\. Earn a relevant degree Pursue a Bachelor's degree in finance, accounting, business administration, or a related field. This will provide you with a strong foundation in financial management and business operations. ### 2\. Gain practical experience Obtain hands-on experience in finance or accounting roles, which can help you develop a deep understanding of [financial management practices](https://www.financealliance.io/7-data-management-problems-and-solutions/), budgeting, and financial analysis. ### 3\. Develop leadership skills As a CFO, you'll need to lead and manage teams, so it's essential to develop strong leadership and communication skills. Seek opportunities to lead projects, mentor junior team members, or participate in leadership development programs. ### 4\. Expand your network Networking can be crucial for career advancement. Attend [finance industry events](https://events.financealliance.io/), join professional organizations, and connect with other finance professionals to stay informed about new developments and job opportunities. ### 5\. Pursue advanced education Consider earning an advanced degree, such as an MBA or a Master's in Finance, which can help you gain a deeper understanding of financial management, strategy, and decision-making. ### 6\. Stay current with industry trends Keep up to date with the latest financial trends, regulations, and best practices by attending conferences, participating in webinars, and reading industry publications. ### 7\. Focus on strategic thinking Develop your strategic thinking skills by analyzing financial data, identifying trends, and making recommendations that support the long-term growth and sustainability of your organization. ### 8\. Gain experience in various industries Broadening your experience across different industries can help you develop a diverse skill set and a more comprehensive understanding of financial management in various contexts. ### 9\. Seek mentorship Identify experienced finance professionals, such as current CFOs or other finance executives, who can provide guidance, advice, and insights on how to successfully navigate a career path toward becoming a CFO. ### 10\. Demonstrate results Showcase your ability to drive financial success by highlighting your achievements in previous roles, such as cost savings, revenue growth, or improved financial performance. ### **Final thoughts** The debate of CFO vs CPA is an intriguing one, revealing the unique yet complementary roles these finance professionals play in the world of business. Although they each possess distinct areas of expertise and responsibilities, their combined efforts can drive a company's financial success. It's important to remember that a CFO doesn't necessarily need to be a CPA, as their focus lies more in the strategic and long-term aspects of a company's financial management. By following the tips provided, aspiring CFOs without a CPA designation can still build a successful career, acquiring the necessary skills and experience to excel in the role. --- ### FAQs: CFO vs CPA What other certifications or designations might be useful for a CFO? Besides a CPA, other certifications that can be beneficial for a CFO include the Chartered Financial Analyst (CFA), Certified Management Accountant (CMA), or Financial Risk Manager (FRM). These designations can demonstrate expertise in various aspects of financial management and may be helpful in advancing your career as a CFO. Can a CFO also perform the tasks of a CPA? A CFO with a strong background in accounting and tax may be able to perform some tasks typically handled by a CPA, such as financial reporting and tax planning. However, if the CFO is not a licensed CPA, they may not be able to represent the company before tax authorities or sign off on certain financial documents. It's essential to consider the specific needs and requirements of your organization to determine whether a CFO can fulfill the roles of a CPA or if separate individuals should handle these responsibilities. How can a CPA become a CFO? For a CPA looking to transition into a CFO role, they should focus on gaining experience in financial strategy, risk management, and leadership. This can include taking on roles with increasing levels of responsibility, participating in executive education programs, and developing strategic thinking and decision-making skills. Networking and building relationships with industry professionals can also help open doors to CFO opportunities. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### Operational finance: A CFO's guide to operational and strategic leadership URL: https://www.financealliance.io/operational-finance/ Last updated: 2025-04-08T17:38:56.000Z Operational finance is an essential aspect of a successful CFO's skill set. But mastering the operational side alone isn’t enough. You also need to wear your strategic leadership hat too and learn to balance both for maximum impact. But how? In this post, we discuss the difference between two primary types of CFO: the strategic leader and the operational leader. We’ll also share how you can integrate the best of both worlds to help you become the best leader for your finance function, covering topics like: - [What is operational finance?](https://www.financealliance.io/p/e474985a-f535-4d8d-9122-d9131636a0ce/#what-is-operational-finance) - [What is strategic finance?](https://www.financealliance.io/p/e474985a-f535-4d8d-9122-d9131636a0ce/#what-is-strategic-finance) - [Pros and cons of embracing operational finance leadership](https://www.financealliance.io/p/e474985a-f535-4d8d-9122-d9131636a0ce/#pros-and-cons-of-embracing-operational-finance-leadership) - [Comparing leadership approaches: Operational CFO vs. strategic CFO](https://www.financealliance.io/p/e474985a-f535-4d8d-9122-d9131636a0ce/#comparing-leadership-approaches-operational-cfo-vs-strategic-cfo) - [How different types of CFOs help businesses](https://www.financealliance.io/p/e474985a-f535-4d8d-9122-d9131636a0ce/#how-different-types-of-cfos-help-businesses) - [Tips for integrating strategic and operational finance](https://www.financealliance.io/p/e474985a-f535-4d8d-9122-d9131636a0ce/#7-tips-for-integrating-strategic-and-operational-finance) ## **What is operational finance?** Operational finance is a crucial aspect of a finance function that focuses on the daily activities driving a business forward. Professionals who specialize in operation finances possess a deep understanding of financial statements and the unique datasets of individual business units. At the heart of operational finance lies the operating financial model. This is a powerful tool weaving complex business processes together to help you hit top-line goals, allocate budgets, and keep cash runway projections on point. Imagine you're figuring out the cost of producing a new product. An operational CFO won't just crunch the numbers for your budget – they'll also reveal the bigger picture, showing you the real impact of that cost on your company. This side of the CFO is about getting up close and personal with the company's past and present finances. The CFO will paint a crystal-clear picture of where you stand today while tirelessly working to trim down those pesky operational costs. --- [How to shorten your month-end close | Finance AllianceOne of the ways to improve Finance is to make the information provided to the business more timely. There are two ways to make the reporting timelier: shortening your month-end close, and speeding up the time from close to reporting and availability of results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceChris King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/pocket-watch-g10b9ffe9f_1920-2.jpg)](https://www.financealliance.io/make-your-information-more-timely/) --- ## **What is strategic finance?** Strategic finance is the domain of CFOs who focus on developing comprehensive financial plans for their companies. Just like operational CFOs, these financial wizards have a deep understanding of the company's inner workings. But, they kick things up a notch by harnessing this knowledge to set ambitious goals and propel the business forward. Picture our previous product production scenario: a strategic CFO wouldn't just wrap their head around production costs – they'd go the extra mile to evaluate future growth potential and shape the company's vision. What truly sets strategic finance apart is its future-focused outlook, which zeroes in on planning and charting a course for the company's long-term financial growth. ## **Pros and cons of embracing operational finance leadership** According to [IBM](https://www.ibm.com/thought-leadership/institute-business-value/en-us/c-suite-study/ceo), CEOs view the CFO as playing the most crucial role in their organizations over the next 2 to 3 years. To live up to their expectations, it's a good idea to get familiar with what it takes to bring operational finance leadership to the role of the CFO, and the pros and cons of doing so: ### **Pros of operational finance leadership** **1\. Transform business data into actionable departmental insights** With their unique vantage point at the crossroads of all business data, operational finance leaders are perfectly positioned to amplify growth. They excel at translating the bigger picture into valuable insights for department leaders, ensuring plans are aligned with business goals and maximizing ROI. **2\. Keep your head above water during market downturns** When the market takes a nosedive, operational CFOs have got the company’s back. They know exactly how to drive efficiencies and guide senior management through crucial decisions to improve cash flow, such as boosting revenue per employee or tweaking payment plans. **3\. Fine-tune performance by benchmarking KPIs** Operational CFOs are masters at monitoring crucial business metrics like gross profit margin, working capital, and operating cash flow. They compare these figures against industry benchmarks to help pinpoint where to trim costs and stay competitive. ### **Cons of operational finance leadership** **1\. Missing the future-focused outlook** While operation finance leadership excels at learning from the past and honing in on the present, they may struggle to envision the company's future, leaving them less prepared for long-term growth and potential financial risks. **2\. Overlooking market changes** Factors like government policy shifts or natural disasters can throw a wrench in the best-laid plans. And even if we set aside these extraordinary circumstances, evolving customer demands, emerging technologies, and shifting marketing strategies make it challenging to make sound financial decisions based solely on past data. --- [5 Pillars of CFO leadership | Finance AllianceCFO leadership isn’t just about flexing your financial muscles. It’s also about inspiring your team, adapting to change, and navigating complex challenges…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/cfo-leadership-pillars-2.jpg)](https://www.financealliance.io/cfo-leadership-pillars/) --- ## **Comparing leadership approaches: Operational CFO vs. strategic CFO** While operational and strategic CFOs both play crucial roles in managing a company's finances, they each bring distinct qualities to the table. Here are some key differences between the two [leadership](https://www.financealliance.io/cfo-leadership-pillars/) styles that help them stand apart: ### Roles Operational CFOs focus on understanding the inner workings of a company to boost efficiency and remove redundancies. They achieve this by scrutinizing each function, pinpointing areas for improvement, and cutting unnecessary expenses. Strategic CFOs, on the other hand, concentrate on the company's financial health and its impact on future growth. They assist management in setting realistic long-term financial goals and provide insights to guide the company toward those objectives. ### Areas of focus Operational CFOs zero in on daily business operations, developing strategies to streamline processes such as: - Allocating team members to projects - Pausing ineffective ad campaigns - Consolidating tools for greater productivity CFOs who are more strategic based will focus on the company's overall financial strategy. They often work closely with product designers to create more profitable product lines, team up with accountants to ensure precise financial reporting, and explore revenue generation possibilities in up-and-coming markets. ### Time Frame Operational CFOs usually zero in on shorter timeframes, delving into past and present financial data gathered over several months up to a year. On the other hand, strategic finance leaders adopt a more long-term perspective, evaluating information across multiple years to obtain insights and analysis. ### Scope The operational side of a CFO will home in on business units or departments, scrutinizing granular details such as daily raw material costs or an individual's weekly performance. In contrast, CFOs who lean in on the strategic side of the role will usually take a more holistic approach, ensuring that each department achieves its financial objectives and promoting company-wide growth. ![How different types of CFOs can help businesses](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Operational-CFO.png) ## **How different types of CFOs help businesses** **Operational CFOs can help your business:** - Reduce excess spending - Enhance ROI - Conduct financial analysis and performance management - Identify and address inefficiencies - Understand the company's operations and financial standing - Provide a comprehensive view of the company's current finances **Strategic CFOs can support your business by:** - Collaborating with executives on future planning - Evaluating the company's financial health - Working with the CEO and HR on staffing needs from a financial perspective - Determining resource allocation strategies - Facilitating sustainable growth through mergers and acquisitions - Boosting stakeholder and investor confidence --- [10 CFO personality traits to go down in history | Finance AllianceWhat are the most important Chief Financial Officer (CFO) personality traits? And what type of person makes a good CFO? In this post, we reveal the top 10 qualities of a good CFO to go down as one of the strongest finance leaders in history.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/CFO-personality-traits.jpg)](https://www.financealliance.io/10-cfo-personality-traits/) --- ## **7 tips for integrating strategic and operational finance** ### 1\. Embrace the magic of finance automation Say goodbye to mundane, repetitive tasks, and hello to finance automation! By leveraging cutting-edge automation tools, you'll free up precious time to focus on strategic decision-making and delve deeper into operational analysis. Watch your accuracy improve and manual data entry become a thing of the past! ### 2\. Build bridges between departments Strong collaboration between departments is your secret weapon for seamlessly blending strategic and operational finance. Encourage open communication, and watch as understanding different business units' priorities helps you craft a financial strategy that aligns with the company's big-picture goals. ### 3\. Keep your finger on the pulse with real-time reporting Stay ahead of the game by implementing real-time reporting systems. As a modern CFO, you'll be able to monitor performance indicators on-the-fly, addressing deviations from expected outcomes and striking the perfect balance between strategic and operational concerns. ### 4\. Adopt a forward-thinking mindset While reflecting on past performance is essential, it's time to shift gears and adopt a forward-looking mindset. Proactively anticipate market changes, spot growth opportunities, and plan for potential risks, all while ensuring your company's financial stability and long-term success. ### 5\. Level up your skills and stay informed The finance landscape is always evolving, so it's crucial to keep your skills sharp and stay on top of industry trends. Embrace continuous learning and professional development opportunities to become a well-rounded CFO who can master both strategic and operational finance. ### 6\. Develop a balanced scorecard Combine the best of both worlds by developing a balanced scorecard that features key performance indicators (KPIs) from strategic and operational finance realms. This powerful approach aligns financial targets with broader business goals, ensuring that short-term operational improvements contribute to long-term strategic growth. ### 7\. Cultivate a data-driven culture Inspire a data-driven culture within your company by emphasizing the significance of data in decision-making processes. Encourage teams to use data as their guiding star, showcasing the impact of their initiatives on the company's financial health. By putting these tips into action, you'll be well on your way to mastering the art of integrating strategic and operational finance. Embrace your role as a dynamic, modern CFO and drive your company towards new heights of growth and success! --- ### FAQs What are examples of financial operations? Examples of financial operations include budgeting, cash flow management, cost tracking, and monitoring the performance of individual business units or departments. What is an operational finance manager? An operational finance manager is a professional responsible for overseeing daily financial activities, improving efficiency, and driving the financial success of specific business units or departments. What is the difference between operational and strategic finance? Strategic finance focuses on long-term financial planning, growth opportunities, and overall business strategy. On the other hand, operational finance prioritizes daily financial activities and short-term goals. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### "It's one of the few events I've been to where I've had extensive dialogue with so many people." - Wing Chang URL: https://www.financealliance.io/fpa-san-diego-2023-case-study/ Last updated: 2025-08-15T08:05:06.000Z [Wing Chang](https://www.linkedin.com/in/wingchan888/), Account Executive/Finance Transformation Specialist at Business Solution Partners, joined our first in-person event, the [FP&A Summit](https://events.financealliance.io) in San Diego. We assembled finance experts from some of the world's largest companies and most exciting startups to share their success stories, experiences, and challenges. The agenda was packed with thought-provoking talks on topics like empowering your inner leader, sustainable finance, dealing with cash flow challenges, how to exceed expectations during your first 90 days as a CFO, and more. After the event, we caught up with Wing and asked him to share his experience at the event. Here's what he had to say: [Browse our events calendar](https://events.financealliance.io) --- ### What stood out to you the most about the FP&A Summit? I've been to a lot of events like this in the past, but what really stood out for me was the level of depth of experience of the attendees. It seems like everyone here is really well entrenched in FP&A, finance, accounting, or the CFO management role. ### What did you think about the networking opportunities at the event? The level of dialogue and experience level has been really impressive. It's one of the few events I've been to where I've had such an extensive dialogue with so many people that are so well entrenched in the FP&A process and really understand it and what they do in FP&A on a day-to-day basis. So, they have a lot of great real-world experience to share. And everyone I've engaged with has been really good about being candid and willing to share what their experience is with FP&A in their organization and other organizations. --- [Top finance events to attend | Finance Alliance2023 is set to be an exciting year with a range of finance events taking place around the world that offer opportunities to learn, network, and grow. Have your calendar ready as we drop the ultimate round-up of top finance events to attend in 2023.👇🏽![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Finance-events.jpg)](https://www.financealliance.io/top-finance-events/) --- ### Don't miss the next FP&A Summit! **🔊** We have lots of exciting events on the horizon and we'd love to see you there! Our events bring together leading experts and practitioners in finance to share their knowledge and best practices. By attending one of our [events](https://events.financealliance.io), you'll have the opportunity to network with other finance professionals and learn from the best in the industry. Whether you're interested in learning about the latest financial technologies, regulatory changes, or investment strategies, our events offer something for everyone. Did we mention you'll earn **CPE/CPD credits** when you attend any of our events? Don't miss out on the chance to advance your career and stay ahead of the curve. [Browse our events calendar](https://events.financealliance.io) *Keep up with our upcoming events by* [*joining our community*](https://www.financealliance.io/community/) *of finance professionals and remember to sign up for our newsletter, '*[*The Monthly Balance*](https://www.financealliance.io/finance-newsletter/)*' to stay in the know!* ### 8 undeniable benefits of having a CFO URL: https://www.financealliance.io/benefits-of-having-a-cfo/ Last updated: 2023-08-08T14:46:32.000Z Did you know there are over[ 131,815 Chief Financial Officers](https://www.zippia.com/chief-finance-officer-jobs/demographics/) (CFOs) currently employed in the United States? It's a mind-blowing number, and it goes to show just how significant the benefits of having a CFO are. These financial experts are transforming companies across the nation by providing strategic insights, optimizing financial performance, and ensuring long-term stability. If you’re still on the fence, here are eight benefits of having a CFO that might change your mind. ### 1\. Cash flow forecasts How many times have you heard that cash is the lifeblood of a business? Probably too many times to count, but it’s true. It’s so important to monitor the cash coming in and out of your business. In fact, when new businesses fail, it’s almost always because they lose control of their cash flow - so don’t let it happen to you. When you bring a CFO on board (or a [virtual Chief Financial Officer](https://www.financealliance.io/how-to-become-a-virtual-cfo/)), you’re also tapping into their knowledge and understanding of financial data and market trends. Backed by their experience and expertise, a CFO creates accurate [cash flow forecasts](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) you can use to closely monitor cash flow, anticipate cash shortages, and make well-informed decisions about investments or working capital expenditures. By recognizing cash flow patterns, a CFO can identify potential issues *before* they snowball out of control. Doing so gives you the foresight to weather any financial storm. --- [10 CFO personality traits to go down in history | Finance AllianceWhat are the most important Chief Financial Officer (CFO) personality traits? And what type of person makes a good CFO? In this post, we reveal the top 10 qualities of a good CFO to go down as one of the strongest finance leaders in history.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/CFO-personality-traits.jpg)](https://www.financealliance.io/10-cfo-personality-traits/) --- ### 2\. Financial strategy development CFOs craft and execute powerful financial strategies that align seamlessly with your company's goals and vision. Taking a comprehensive approach to strategy development, CFOs examine the [bigger picture](https://www.financealliance.io/10-big-picture-financial-planning-steps/). They factor in elements such as market trends, competitive dynamics, and your company's distinct strengths and weaknesses to build strategies that position your company to: - Tackle challenges head-on - Seize lucrative opportunities - Attain lasting growth ### 3\. Increased profits According to[ PWC](https://www.pwc.com/us/en/library/executive-leadership-hub/cfo.html), 91% of business executives agree that a CFO’s ability to build and maintain trust improves the bottom line. As you can imagine, increasing profits is one of the greatest benefits of having a CFO. They can effectively benchmark profits and financials against industry averages, which helps you to [identify areas for cost savings ](https://www.financealliance.io/5-cost-reduction-strategies/)through expense analysis, process streamlining, and supplier negotiation. Some examples of how CFOs discover revenue growth opportunities include: - Assessing pricing strategies - Exploring new markets - Finding ways to upsell or cross-sell products --- [5 Pillars of CFO leadership | Finance AllianceCFO leadership isn’t just about flexing your financial muscles. It’s also about inspiring your team, adapting to change, and navigating complex challenges…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/cfo-leadership-pillars-2.jpg)](https://www.financealliance.io/cfo-leadership-pillars/) --- ### 4\. Reduce business risks Risk is an inherent part of doing business regardless of your industry. However, having an experienced CFO means your company's exposure to financial risks is significantly lower. [CFOs possess the skills](https://www.financealliance.io/top-10-cfo-skills/) and experience to identify potential risks, assess their impact, and develop strategies to mitigate them. Whether it's navigating complex compliance requirements, managing credit risk, or safeguarding against fraud, a CFO's expertise safeguards your company. ### 5\. Leverage negotiations and pricing A skilled CFO can work wonders when it comes to negotiations and pricing. They understand the importance of striking the right balance between competitive pricing and maintaining healthy profit margins. You can depend on your CFO to implement optimal pricing strategies to drive revenue *without* sacrificing profitability. Not to mention, CFOs are often involved in negotiating contracts with vendors, suppliers, and partners. Their strong negotiation skills can result in more favorable terms, lower costs, and better overall deals for the company. These savings can then be reinvested into your business, fueling further growth and success. ### 6\. Improved operational efficiency A CFO's impact extends beyond just the financial realm. They can also significantly improve your company's operational efficiency. By applying their analytical skills and a keen eye for detail, CFOs identify bottlenecks, inefficiencies, and areas for improvement across various processes and departments. By working closely with other executives and team leaders, CFOs can help: - Implement new systems - Streamline workflows - Promote a culture of continuous improvement --- [7 data management problems and solutionsData management plays a pivotal role in driving insightful decisions and ensuring the financial success of a company. But let’s face it – navigating this intricate landscape can feel like a battle, filled with data management challenges like inaccuracies, security breaches, and complex integrations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/markus-spiske-8OyKWQgBsKQ-unsplash-2.jpg)](https://www.financealliance.io/7-data-management-problems-and-solutions/) --- ### 7\. Accelerate financial software [McKinsey](https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/our-insights/mastering-change-the-new-cfo-mandate) revealed that the number of finance leaders who claim responsibility for their companies' digital activities has more than tripled between 2016 and 2021\. Today, nearly two-thirds of finance leaders oversee these activities, compared to 44% in 2016. Our own [State of Finance Transformation Report](https://www.financealliance.io/state-of-finance-transformation-report-2022/) revealed similar findings with 74.1%of respondents reporting that the CFO was the one responsible for finance transformation (and implementing technology and software) in the workplace. If you want to leverage financial software and use it to drive performance, a full-time or [fractional CFO](https://www.financealliance.io/how-to-become-a-fractional-cfo/) can help identify and implement suitable software for your finance function. They can also train your team to use these tools properly, ensuring your company reaps the full benefits of cutting-edge technology. ### 8\. Make informed business decisions Finally, a CFO benefits your company by helping you (and senior management) make informed, data-driven decisions by providing accurate financial reports, analyses, and forecasts. CFOs also give valuable advice based on their expertise, helping you avoid financial pitfalls and seize opportunities. The benefit of having a CFO means your company's decisions are backed by solid financial analysis, ensuring long-term success. --- ### FAQs - Benefits of having a CFO What value does a CFO bring to a company? A CFO brings financial expertise, strategic planning, risk management, and data-driven decision-making. They're like a financial superhero making your company more resilient and competitive. What are the benefits of having a CFO? CFO benefits include improved financial reporting, better cash flow management, cost control, and expert guidance during mergers, acquisitions, or fundraising. In short, they keep your financial house in order! What is the most important quality of a CFO? The most important quality is a combo of financial expertise and strategic thinking. A great CFO can crunch numbers and craft a winning game plan for your company's growth and success. --- ### Don't miss our virtual CFO Summit - May 10! 🎓 Earn CPE & CPD credits by attending the summit. ❓Solve common challenges by connecting with 500+ fellow finance leaders. 🧠 Accelerate your company's growth by tapping into the brightest finance minds. [Register for free](https://cfosummit23.financealliance.io/?%5Fgl=1%2Ay6s2dh%2A%5Fga%2AODIzNzQwOTAxLjE2ODA5NDY3Mjk.%2A%5Fga%5F2NXFSBEP4N%2AMTY4MjQyMjQ5MC41Ni4xLjE2ODI0MjMwODYuMC4wLjA.) ### How to use ChatGPT for Excel: A guide for FP&A URL: https://www.financealliance.io/chatgpt-for-excel/ Last updated: 2025-05-07T11:06:33.000Z Tired of memorizing and writing Excel formulas? Enter ChatGPT for Excel: a cutting-edge language model developed by [OpenAI](https://chat.openai.com/chat). Think of it as a digital consultant that also happens to be a pro at Excel. It can help you crunch numbers, analyze financial data, or even draft reports with ease. In this blog post, you'll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes. We also discuss: - [How ChatGPT can be used in finance](https://www.financealliance.io/p/37d770f2-b702-41b3-8309-690ed3ad3279/#how-chatgpt-can-be-used-in-finance) - [ChatGPT vs Copilot: What’s the difference?](https://www.financealliance.io/p/37d770f2-b702-41b3-8309-690ed3ad3279/#chatgpt-vs-copilot-what%E2%80%99s-the-difference) - [ChatGPT pros and cons](https://www.financealliance.io/p/37d770f2-b702-41b3-8309-690ed3ad3279/#chatgpt-pros-and-cons) - [How to upload data from Excel to ChatGPT](https://www.financealliance.io/p/37d770f2-b702-41b3-8309-690ed3ad3279/#how-to-upload-financial-data-from-excel-to-chatgpt) - [Using ChatGPT to create Excel formulas](https://www.financealliance.io/p/37d770f2-b702-41b3-8309-690ed3ad3279/#how-to-use-chatgpt-to-write-microsoft-excel-formulas) - [How ChatGPT can help explain complex formulas](https://www.financealliance.io/p/37d770f2-b702-41b3-8309-690ed3ad3279/#how-to-use-chatgpt-to-explain-excel-formulas) - [How to create macros](https://www.financealliance.io/p/37d770f2-b702-41b3-8309-690ed3ad3279/#how-to-use-chatgpt-to-create-macros) - [Generating financial reports](https://www.financealliance.io/p/37d770f2-b702-41b3-8309-690ed3ad3279/#how-to-use-chatgpt-to-generate-financial-reports) - [Using ChatGPT for data analysis](https://www.financealliance.io/p/37d770f2-b702-41b3-8309-690ed3ad3279/#how-to-use-chatgpt-for-excel-data-analysis) - [ChatGPT FP&A prompts](https://www.financealliance.io/p/37d770f2-b702-41b3-8309-690ed3ad3279/#chatgpt-prompts-for-fpa) ## **How ChatGPT can be used in finance** According to [Forbes](https://www.forbes.com/sites/martineparis/2023/02/03/chatgpt-hits-100-million-microsoft-unleashes-ai-bots-and-catgpt-goes-viral/?sh=56dd1eba564e), since hitting 100 million monthly engaged users, ChatGPT set a new record as the most rapidly expanding consumer internet application in history. On top of that, [Yahoo Finance](https://news.yahoo.com/chatgpt-on-track-to-surpass-100-million-users-faster-than-tiktok-or-instagram-ubs-214423357.html?guccounter=1) reported that UBS analysts estimate the overall potential market value for ChatGPT at a staggering $1 *trillion*. So, it should come as no surprise to learn that modern finance teams have jumped at the chance to leverage ChatGPT within their roles, helping to perform activities such as: - **ChatGPT data analysis:** Uncovering insights from complex data sets. - **Drafting reports:** Creating clear and concise financial documents. - **Forecasting trends:** Predicting market movements and identifying opportunities. - **Managing risk:** Evaluating potential risks and making informed decisions. - **Automating routine tasks:** Streamlining processes and improving efficiency. - **Research assistance:** Staying up to date with the latest financial news, market trends, and regulations. - **Decision support:** Providing data-driven insights for strategic planning and investment decisions. ![ChatGPT vs Copilot - ChatGPT logo image](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/Excel-ChatGPT-2.jpg) ## ChatGPT vs Copilot: What’s the difference? Both ChatGPT and [Microsoft’s Copilot](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) are AI-powered tools developed by OpenAI, but they serve different purposes. While ChatGPT is a language model designed to understand and generate human-like text, Copilot is an AI tool specifically tailored for code generation and assistance in software development. --- [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/10/CFO_Summit_London_NOV24_Email_Banner_-6.png)](https://cfoevents.financealliance.io/location/cfolondon) --- ### Similarities between Copilot vs ChatGPT - Both are powered by OpenAI's cutting-edge technology. - They can understand context and provide relevant suggestions or solutions. - Both have been trained on massive data sets to deliver accurate and useful outputs. ### Differences between ChatGPT vs Copilot - ChatGPT focuses on natural language processing and understanding, while Copilot is centered on code generation and software development. - Copilot is integrated with code editors, like Visual Studio Code, whereas ChatGPT is designed for more general-purpose text-based tasks. --- [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) --- ## **ChatGPT pros and cons** This cutting-edge tool has made a significant impact on the financial landscape, streamlining tasks and revolutionizing the way professionals work. However, like any technological advancement, ChatGPT has its pros and cons when applied to finance tasks. ### **ChatGPT Pros:** - **Natural language understanding:** ChatGPT excels at understanding and generating human-like text, making it a versatile tool for a wide range of tasks. - **Diverse applications**: ChatGPT can be used for tasks such as data analysis, report drafting, forecasting, and research assistance. - **Large knowledge base**: Trained on a massive dataset, one of the best benefits of ChatGPT is its extensive knowledge on a variety of topics. This allows it to provide relevant and informed responses. - **Time-saving**: It can help automate routine tasks and improve efficiency, freeing up time for finance professionals to focus on more complex or strategic work. - **Decision support**: ChatGPT can provide data-driven insights and information to support decision-making and problem-solving in various domains. ### **ChatGPT Cons:** - **Knowledge cutoff**: ChatGPT's training data only extends up to September 2021, which means it may not be up-to-date on the most recent information or events. - **Context limitations**: While ChatGPT is good at understanding context, it may sometimes misunderstand or misinterpret user inputs, leading to less accurate or relevant responses. - **Output quality**: ChatGPT's generated text may occasionally contain errors, inaccuracies, or inconsistencies, which means users must verify and cross-check information. - **Bias and sensitivity**: The AI may unintentionally exhibit biases or generate outputs that are politically, culturally, or socially sensitive, as it is trained on data that may contain such biases. - **Dependence on user guidance**: ChatGPT's performance largely depends on the clarity and specificity of user input; unclear or ambiguous queries may result in less helpful or accurate responses. ### **Does ChatGPT save data?** As an AI language model, ChatGPT itself doesn't save data. However, the platform you're using to access ChatGPT might store your conversation history for a certain period. OpenAI, the company behind ChatGPT, has a data retention policy outlining how long user data is stored. As of September 2021, OpenAI retains API data for 30 days and no longer uses data sent via the API to improve its models. It's essential to review the data storage and privacy policies of the platform you're using to access ChatGPT to understand how your data is handled. --- [How to use Microsoft Fabric for data analysisWith Microsoft Fabric, you can bridge the gap between data and intelligence and integrate all your data seamlessly. These tools have opened up new possibilities, setting the stage for a new era in finance AI.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Microsoft-fabric-1.jpg)](https://www.financealliance.io/microsoft-fabric-for-data-analysis/) --- ## **How to upload financial data from Excel to ChatGPT** While ChatGPT doesn't have a built-in feature to directly upload data from Excel or Google Sheets, you can work around this limitation. Here's how: ### 1\. Copy and paste data as plain text The simplest way to share data from Excel with ChatGPT is by copying the relevant data and pasting it as plain text in the chat window. Be sure to maintain a clear and organized structure so that the AI can understand the data easily. For example: ![ChatGPT data analysis](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-gbbysc8kgdv.png) With this ChatGPT dataset, you can now ask the AI tool to analyze or perform specific tasks based on your financial data. ### 2\. Summarize the data and share key details Another approach is to summarize the data in a brief, concise format before sharing it with ChatGPT. This method can be especially useful when dealing with large datasets but may require more effort on your part in the 'prepping' stage. For example, if you have a dataset containing monthly revenues, you could share a summary like this: ![ChatGPT dataset](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-2q7zlip9vne.png) You can then ask ChatGPT to analyze the data, find trends, or provide insights based on the summary. ### 3\. Use third-party integrations Developers can also use the OpenAI API to integrate ChatGPT into custom applications, which could potentially facilitate a more seamless connection between Excel, Google Sheets, and ChatGPT. By doing so, you could programmatically transfer data between these platforms and access the AI's analysis capabilities more efficiently. *Remember that while these methods allow you to share data with ChatGPT, the AI might not always interpret or analyze the information with perfect accuracy. Be prepared to review the responses and make any necessary adjustments to ensure the desired results.* ## **How to use ChatGPT to write Microsoft Excel formulas** Instead of manually entering complex formulas, you can now ask ChatGPT to generate them for you. Simply type your query in plain English, and ChatGPT will provide the appropriate formula, saving you time and reducing the risk of errors. Here are a few examples of ChatGPT use cases with Excel: ### Prompt 1: ![ChatGPT excel formula](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-qfmgj1r7vr.png) ChatGPT told us to use the SUM function and gave us the Excel formula =SUM(B2:B11). So, we pasted that exact formula into cell B12 and the total sum was immediately calculated. ![ChatGPT for Excel](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-nc4stk5myd.png) ### Prompt 2: Next, we tested using a prompt for a formula to help calculate the 12-month rolling average of monthly expenses in one column only. Here's how ChatGPT responded: ![ChatGPT for excel and FP&A](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-vf7or1wl0cs.png) Remember these three tips to help you get the most out of ChatGPT and Excel: **1\. Be specific with your request** When asking ChatGPT to generate a formula, provide clear and detailed instructions. For example, instead of asking for "*a formula to calculate the total revenue*," specify "*a formula to sum up the revenue from column B, rows 2 to 100.*" **2\. Double-check the output** ChatGPT is an impressive tool, but it's not infallible. Always verify the generated formula *before* incorporating it into your spreadsheet. This will help you avoid any inaccuracies that may arise from miscommunication or AI limitations. **3\. Iterate your request** If ChatGPT doesn't provide the desired formula on the first try, don't be afraid to rephrase your request or provide additional context. This can often lead to a more accurate result. --- [Infographic: 10 financial performance metrics & calculationsWith so many different metrics to track for your financial performance analysis, we thought we’d lend you a helping hand with this useful infographic featuring 10 financial performance metrics (and their calculations) to help you monitor and assess the financial health of your organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/10-financial-perfornance-metrics-infographic.jpg)](https://www.financealliance.io/infographic-financial-performance-metrics/) --- ## How to use ChatGPT to explain Excel formulas FP&A professionals rely on Excel formulas to help search for specific values, calculate findings, and so on. But what are the most useful Excel formulas used by FP&A teams? And how does each one work? We asked ChatGPT that question and here’s what it had to say: ![ChatGPT and Excel formula examples](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-v33boaw29q.png) As you can see, ChatGPT was able to not only provide examples of the top three Excel formulas for FP&A but also explained each one accurately. ## **How to use ChatGPT to create macros** Macros are like your personal Excel assistants, taking care of those repetitive tasks for you with just a click of a button. They're programmed using Visual Basic for Applications (VBA) and can handle everything from simple formatting to complex calculations. Now, imagine combining the power of macros with the intelligence of ChatGPT. Sounds like a dream team, doesn't it? Here's how you can make that dream a reality: 1. Start by getting crystal clear on what you want your macro to do. Jot down the steps, calculations, or any specific details involved in the task. 2. When you're ready to ask ChatGPT for help, channel your inner storyteller and paint a vivid picture of the task at hand. The more information you provide, the better ChatGPT can understand what you need. 3. If your macro feels like a jigsaw puzzle, don't worry! Break it down into smaller, bite-sized pieces, and ask ChatGPT for help with each section. This way, you can build your macro step by step, making it much easier to grasp and manage. 4. Once you've got your shiny new macro from ChatGPT, give it a thorough once-over. Keep in mind that ChatGPT is incredibly smart, but it's not foolproof. Double-checking the code ensures that it's accurate and does exactly what you need it to do. --- [How to create a digital reporting shortcut in 3 easy stepsHow can you as the CFO (and/or your finance team members) create a financial report that’s truly time-efficient? In this post, I reveal 3 easy steps to create a digital reporting shortcut for busy CFOs and their finance teams.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceDaniel Echeverri![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/lukas-blazek-mcSDtbWXUZU-unsplash.jpg)](https://www.financealliance.io/digital-reporting-shortcut/) --- ## **How to use ChatGPT to generate financial reports** ChatGPT can also help you create comprehensive and visually appealing reports. By asking the AI model to generate charts, tables, or graphs based on your data, you can quickly transform raw data into actionable insights. You can use ChatGPT with both Excel and Google Sheets to [create financial reports ](https://www.financealliance.io/digital-reporting-shortcut/)such as: - Income statements - Balance sheets - Cash flow statements - Budget vs. actual reports - Sales performance reports - Financial ratios analysis We asked ChatGPT to provide a mock example of how FP&A can use it to create a quarterly sales performance report. Here’s what it gave us: ![excel ChatGPT prompt](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/data-src-image-lhf3y20yq9k.png) This mock example demonstrates how ChatGPT can help FP&A professionals create a financial report by providing a structured summary of sales performance, including key insights and recommendations. *Remember to always review and verify the output to ensure accuracy and relevance.* ### **Tips to effectively use ChatGPT for Excel reports** 1. **Data preparation**: Start by ensuring your data is clean, organized, and formatted correctly. Remove any inconsistencies or errors to enable ChatGPT to work with the most accurate information possible. 2. **Be specific with your request**: When asking ChatGPT to create charts, tables, or graphs, provide clear instructions and context about your data. For example, instead of requesting a "*chart for revenue*," ask for a "*bar chart representing monthly revenue from January to December 2022*." 3. **Use templates**: Create a set of report templates with predefined sections, charts, and tables. This will help ChatGPT understand the structure and layout you want to maintain, resulting in more accurate and visually appealing reports. 4. **Textual explanations and summaries**: In addition to visual elements, ask ChatGPT to provide written explanations, summaries, or insights based on your data. This can help you identify trends, patterns, or anomalies that may not be immediately apparent from the charts and tables. 5. **Review and refine**: Always review the generated reports to ensure accuracy and relevance. While ChatGPT is a powerful tool, it is not infallible. By reviewing and refining the output, you can catch any inaccuracies and make necessary adjustments. 6. **Iterate and optimize**: As you continue to use ChatGPT for financial reporting, learn from its output and optimize your instructions and templates to yield even better results. Over time, this iterative process will enable ChatGPT to create increasingly accurate and insightful reports. --- [How to build a culture of financial data analytics | Brian Kalish | Finance AllianceOur ‘new normal’ keeps changing and finance teams must adjust processes including people, process, culture, and technology to adapt. Confronting a historic level of uncertainty has rendered traditional methods of data analytics, forecasting, and scenario planning all but useless.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/sean-pollock-PhYq704ffdA-unsplash-2.jpg)](https://www.financealliance.io/how-to-build-a-culture-of-financial-data-analytics-to-develop-and-act-on-business-insights/) --- ## **How to use ChatGPT for Excel data analysis** ChatGPT can be a game-changer for your [data analysis](https://www.financealliance.io/microsoft-fabric-for-data-analysis/) process. Here are some ways to harness its potential: - **Data cleaning and preprocessing:** ChatGPT can assist you in cleaning and preprocessing your data by identifying inconsistencies, missing values, and outliers, ensuring your analysis is based on accurate and reliable data. - **Descriptive analysis:** Use ChatGPT to generate summary statistics, frequency distributions, or visual representations of your data, providing you with an overview of the key trends and patterns. - **Predictive analysis:** ChatGPT can help you create predictive models by suggesting relevant algorithms, estimating parameters, and validating your model's performance. - **Scenario analysis:** By utilizing ChatGPT's natural language understanding, you can conduct scenario analyses by asking the AI model to forecast outcomes based on different input variables. ![Excel ChatGPT for finance](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/d-koi-Fc1GBkmV-Dw-unsplash.jpg) ## **ChatGPT prompts for FP&A** To get the most out of ChatGPT, it's crucial to communicate your requests effectively. Use clear and concise language, and don't hesitate to provide context or ask follow-up questions if needed. Imagine you're a finance professional trying to assess the impact of a proposed merger on your company's financials. Instead of asking ChatGPT, "*What happens after the merger?*", provide more specific information, like the financials of both companies, the merger terms, and the expected synergies. This will enable ChatGPT to give you a more accurate and insightful analysis. Here's a list of prompts that you can use to get help from ChatGPT for various FP&A tasks, along with some tips on how to achieve the best and most accurate results: **1\. "*What are the key drivers affecting our revenue forecast? Please consider the provided historical data and external factors*."** Provide historical data and mention specific external factors that could impact your business. **2.** **"*Help me create a financial model to project our company's cash flow over the next five years based on the provided assumptions and historical data*."** Share relevant data and assumptions, such as revenue growth rates, expenses, and capital expenditures. **3.** **"*Analyze the provided budget data and suggest areas where we could potentially reduce costs without significantly impacting operations.*"** Offer a clear overview of your current budget, including detailed expense breakdowns. **4.** **"*Based on our historical sales data, identify any seasonal trends that we should consider in our sales forecast.*"** Provide sales data with clear date markers to help ChatGPT spot patterns. **5.** **"*What is the optimal capital structure for our company, given our current financials and industry benchmarks?*"** Share your company's financials, along with relevant industry benchmarks or ratios. **6\. "*Evaluate the potential financial impact of implementing a new marketing campaign, considering our current marketing spend and ROI data.*"** Provide information on your current marketing budget and ROI, as well as details about the proposed campaign. **7\. "*Help me create a flexible budget model that can accommodate changes in sales volume, production levels, and other variables.*"** Specify the variables that should be considered and share any relevant data or assumptions. **8.** **"*Analyze the provided sales data by product category and region to identify areas of growth and underperformance.*"** Offer detailed sales data, including product categories and regional information. **9.** **"*How should we allocate our R&D budget to maximize long-term growth and innovation, considering the provided data on past projects and their outcomes?*"** Share information on previous R&D projects, their budgets, and results. **10\. "*Using the provided financial data, help me determine the breakeven point for our new product line.*"** Provide information on product costs, pricing, and any relevant fixed or variable expenses. To get the best and most accurate results from ChatGPT, remember to: - Be specific and clear in your prompts. - Provide relevant and well-organized data. - Offer context and additional information when needed. - Break down complex tasks into smaller, manageable parts. - Always review and verify the AI's output for accuracy. By using these prompts and following the tips above, you can leverage ChatGPT to enhance your daily activities, streamline processes, and make data-driven decisions. --- ### FAQs - ChatGPT and Excel How do I open ChatGPT in Excel? ChatGPT isn't directly integrated into Excel, but you can still use it to help you with your Excel tasks. You'll need to access ChatGPT through the OpenAI website, OpenAI API, or a third-party platform that has integrated ChatGPT. Just ask your questions or provide your requests in the chat interface, and you can apply the provided guidance in your Excel workbook. Can ChatGPT solve Excel problems? Absolutely! ChatGPT can help you tackle various Excel problems, from simple tasks like writing formulas to more complex ones like creating macros. Just remember that it's always a good idea to double-check the AI's suggestions for accuracy and relevance to your specific problem. How many questions can you ask ChatGPT in an hour? There's no strict limit on the number of questions you can ask ChatGPT in an hour. It depends on your access level, subscription plan, or the platform you're using. Generally, you can ask as many questions as needed, but keep in mind that some platforms may impose usage limits or throttle requests during peak times.For example, if you use GPT-4, you can ask a total of 25 messages every three hours (as it currently stands). What countries is ChatGPT available in? ChatGPT is available to users from around the world, as long as they have access to the internet and a compatible device. However, some specific platforms or integrations might have geographic restrictions, so it's best to check the availability of the platform you're using to access ChatGPT. Why does ChatGPT ask for a phone number? ChatGPT itself doesn't ask for a phone number. However, the platform you're using to access ChatGPT might require phone number verification to ensure account security or prevent abuse. It's a common practice to help protect user accounts and maintain a safe online environment. How much data is ChatGPT trained on? ChatGPT is trained on a vast dataset that includes text from websites, books, and other sources. It has been designed to understand and generate human-like text based on the patterns it has learned from this data. While the exact size of the dataset is not disclosed, it's safe to say that it's in the range of terabytes, allowing ChatGPT to understand a wide variety of topics and provide relevant information to users. --- ### Further reading: Learn more about [Microsoft 365 Copilot and Excel](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) with this article: [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) Find out more about Microsoft Fabric and how you can use it with Data Factory, Synapse Real-Time Analytics, and more here: [How to use Microsoft Fabric for data analysisWith Microsoft Fabric, you can bridge the gap between data and intelligence and integrate all your data seamlessly. These tools have opened up new possibilities, setting the stage for a new era in finance AI.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Microsoft-fabric-1.jpg)](https://www.financealliance.io/microsoft-fabric-for-data-analysis/) Read all about how to use Copilot with Power BI here: [How to use Copilot in Power BIIn this article, we explore how you can leverage the power of Copilot in Power BI to help streamline your everyday processes within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/copilot-in-power-bi-2.jpg)](https://www.financealliance.io/copilot-in-power-bi/) And finally, discover how to use Google Bard with Excel and Google Sheets: [How to use Google Bard with Google Sheets and ExcelIn this article, we discuss the rise of Google Bard and how it can act as your personal assistant within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Bard.jpeg)](https://www.financealliance.io/google-bard-with-google-sheets-excel/) --- ### Join the Finance Alliance Slack Community! Sign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders. Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. So, what are you waiting for? Sign up today! (it’s free). [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### 4 stages of how finance business partners drive value URL: https://www.financealliance.io/how-finance-business-partners-drive-value/ Last updated: 2025-04-07T16:25:25.000Z Want to know how you can drive massive value for your organization? Well, buckle up, because [Christian Wattig](https://www.linkedin.com/in/christian-wattig/), Managing Director at FP&A Prep, has got a killer framework that’ll help you create value as a finance business partner. Keep reading to hear from Christian as he talks about the four stages of finance development, as well as the essential skills you need to succeed.👇 **Topics covered:** - [Finance business partnering skills](https://www.financealliance.io/p/5ce7325b-188e-49a3-a7d6-72ee155195c5/#finance-business-partnering-skills) - [How to develop key finance business partnering skills](https://www.financealliance.io/p/5ce7325b-188e-49a3-a7d6-72ee155195c5/#how-to-develop-key-finance-business-partnering-skills) - [The 4 stages of finance business partnering](https://www.financealliance.io/p/5ce7325b-188e-49a3-a7d6-72ee155195c5/#the-4-stages-of-finance-business-partnering) - [Advice for aspiring business partners in finance](https://www.financealliance.io/p/5ce7325b-188e-49a3-a7d6-72ee155195c5/#advice-for-aspiring-business-partners-in-finance) ## Finance business partnering skills It’s possible to land a finance business partnering role, even if you haven’t done it before. To better position yourself, go over your prior responsibilities and think about where you worked with other teams. Then look at how you helped them achieve their goals and make sure that’s highlighted in your resume. A finance business partner needs to combine broad technical and deep people skills. They need the financial know-how, but they also need to be able to translate it into a language anyone can understand. And it’s about more than simple communication skills. The best financial analysis is worthless if people don’t take action. So, to be effective as a finance business partner, they need to be effective at influencing people over whom they don’t have hierarchical authority. --- [How to transform your team into finance business partnersFinance teams are more than just number crunchers. To become a finance business partner, you must create value by providing insights that help business leaders make data-driven decisions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Schöler![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/finance-business-partners-header-image.jpg)](https://www.financealliance.io/number-crunchers-finance-business-partners/) --- ## How to develop key finance business partnering skills On-the-job support from an experienced mentor is the best way to learn higher-level finance business partnering skills. You should learn from someone who has done business partnering successfully for a long time, ideally more than ten years. Someone who led teams of finance business partners and worked closely with senior leaders in other departments. If you don’t have access to such a mentor in your company, the next best thing is to find someone online who is willing to share what they learned. But remember that skills like financial storytelling can’t be learned by passively watching videos. You need to be able to apply what you learn right away in a safe environment. So live, bootcamp-style courses that are delivered via Zoom are the way to go. This type, of course, gives you the opportunity to apply new skills in breakout room discussions, guided brainstorming sessions, and even role plays. You meet and connect with other finance professionals, and it’s more engaging and fun than watching hours of videos. That’s why I decided to create just such a course, called “FP&A Bootcamp”. ## The 4 stages of finance business partnering Finance needs to do more than manage budgets and maintain standard reporting. You can think of it as a pyramid with four stages of finance development: ![Framework by Christian Wattig](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/4-stages-of-finance.png) ### 1\. Data focus At the bottom of the pyramid, you focus on data. At this stage, you’re just getting started with reporting. Your focus is ensuring you share accurate and timely data. ### 2\. Story focus Once you master that, the next stage is to understand what the insights and the stories behind the data are. There are more metrics than any executive could reasonably process at a given time, so you need to separate raw data from insights. ### 3\. Strategy focus [Finance business partners](https://www.financealliance.io/tag/business-partnering/) need to understand how the business ticks. The goal is to take the focus *out* of the siloed finance function and challenge ourselves to understand how those insights link with broader strategies. To do that, we need to understand what the marketing, sales, and product strategies are. Then we can start connecting strategy with action plans, we can determine metrics to track those plans, and finally determine if the strategies work. At this stage, we’re also starting to evaluate investment decisions. That’s when leaders come to finance and say, “*Hey, we’re planning to make this investment. What do you think? Is this a positive return on investment? Should we go ahead with it?*” ### 4\. Proactive value-creation The final stage at the top of the pyramid is proactive value creation. Now, finance business partners start to make concrete recommendations about risks and opportunities to help improve return on investment and drive the company forward. All the other stages I mentioned must be mastered so you can do this. You need to have accurate data to identify the stories that matter *now*. And you need to understand the goals and objectives of the other parts of the company to evaluate what works and what doesn’t. Then, you have everything you need to start connecting the dots. You can start to spot changes in trends early and use that to do scenario planning. This, in turn, allows you to make concrete recommendations about what to do differently to capitalize on new opportunities and mitigate risks. --- [6 steps for your first project as a finance business partnerIn this blog post, Srushti Mahamuni, Operation Business Analyst at Bank of America Merrill Lynch, guides you through the six steps to get started on your first project as a finance business partner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSrushti Mahamuni![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/finance-business-partnering-project.jpg)](https://www.financealliance.io/6-steps-to-tackle-your-first-project-finance-business-partner/) --- ## Advice for aspiring business partners in finance Don’t ask for it, just go ahead and do it. Once you have shown your leadership that you can add value as a finance business partner, it’s easier to convince them to make it a bigger part of your role. Here is a quick tip to get you started: Ask someone in another department what they would like to know about their business to make better decisions. Then take a look at the data you have access to and see if you can come up with a way to give them those metrics. Then, you immediately deliver value to the other person and they are more likely to spend the time to teach you how their side of the business works. --- ### Enrol in our Business Partnering & Storytelling: Certified Course Drive smarter business decisions by mastering the art of storytelling and business partnering. This [**Business Partnering & Storytelling**](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) course gives you the tools to transition from simply analyzing numbers to using them to inspire change and profit. Gain five hours of engaging, on-demand content, actionable slides, and expert advice from **Christian Wattig** to turn complex data into compelling stories. You’ll learn how to influence decision-makers and build stronger, more productive business relationships. [Find out more](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) ### Convince the boss letter URL: https://www.financealliance.io/finance-alliance-convince-the-boss/ Last updated: 2024-05-11T08:08:38.000Z Use this handy template to help you craft a learning & development request that will allow you to engage with financial leaders at the next Finance Alliance summit. [Finance Alliance Convince the boss Finance Alliance Convince the boss .pdf71 KBdownload-circle](https://www.financealliance.io/content/files/2023/04/Finance-Alliance-Convince-the-boss-.pdf "Download") ### 4 tips to become a successful finance business partner URL: https://www.financealliance.io/4-tips-to-become-a-successful-finance-business-partner/ Last updated: 2025-04-07T16:25:42.000Z Are you ready to take on a new challenge and become a strategic business partner in your organization? If so, you're in luck, because [Christopher Spencer](https://www.linkedin.com/in/christopher-spencer/), Finance Business Partner at Staffordshire University, has generously shared his top four tips for finance professionals who want to make the leap. But before Christopher reveals his tips, let’s take a moment to remind ourselves why finance business partnering is so important. ## The importance of finance business partnering Here are four reasons why becoming a partner to the business is so important for finance professionals: 1\. It aligns financial goals with the strategic goals of an organization, helping to ensure that the business is in the best possible position to conquer both. 2\. It involves working closely with other departments to understand their needs, identify opportunities for improvement, and provide financial insights and support to help the business make informed decisions. 3\. It helps drive the success of the business and ensures that it’s well-positioned for long-term growth. 4\. It can also help to improve communication and collaboration within an organization since it promotes sharing of information between departments and improves understanding of the organization’s financial position. --- [How to transform your team into finance business partnersFinance teams are more than just number crunchers. To become a finance business partner, you must create value by providing insights that help business leaders make data-driven decisions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Schöler![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/finance-business-partners-header-image.jpg)](https://www.financealliance.io/number-crunchers-finance-business-partners/) --- Now, let’s get into the tips! Whether you're looking to switch careers or take your current role to the next level, these tips are practical, actionable, and guaranteed to help you stand out in your organization. So, let's get started and discover how you can become a finance business partner extraordinaire! 👇 ## How to be a good finance business partner ### 1\. Make sure you understand the organization you work for The difference between a finance business partner and a ‘number cruncher’ is that FBPs are there to ‘partner’ with other individuals or departments in the organization, giving guidance support, and strategic advice. To do this well, you need to understand the environment you're in, and the context of the advice you are giving. It’s well worth reading up on what your organization does and spending some time on the ‘shop floor’ to get a real feel for it. I work for a university. A university has very different challenges to (for example) a manufacturing organization. I didn’t go to university myself (having qualified on the job with CIMA), so didn’t have the organizational knowledge I needed. I got around this by networking, subscribing to sector newsletters, and volunteering to do some other work in the organization – such as exam invigilation and helping at open days. Just putting in a little time on this made a huge difference to the value I can add. ### 2\. Gain a professional qualification (such as CIMA, ACA, or ACCA) It’s hard work but gaining a professional qualification gives you a very tangible ‘leg up’ that no one can take away from you. It gives you credibility in a very ‘black and white’ way, as well as a solid technical grounding. --- [6 steps for your first project as a finance business partnerIn this blog post, Srushti Mahamuni, Operation Business Analyst at Bank of America Merrill Lynch, guides you through the six steps to get started on your first project as a finance business partner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSrushti Mahamuni![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/finance-business-partnering-project.jpg)](https://www.financealliance.io/6-steps-to-tackle-your-first-project-finance-business-partner/) --- ### 3\. Be confident When you are giving advice to senior managers in your organization, it can be easy to suffer from imposter syndrome but remember you are there for your finance expertise. The odds are that in any meeting outside of the finance department, you will know significantly more about finance than anyone else in the room. You wouldn’t imagine you know more about HR than an HR professional, even if you are more senior than them – this is the same situation, so speak with confidence, and don’t be afraid to use your authority. ### 4\. Speak plainly in non-technical language As an FBP, you'll often be supporting people who are not finance trained. Remember, they will not usually be familiar with words like ‘accrual’ or ‘pre-payment’, so try to put things into layman’s terms and help them to understand. You have to be patient, but this is another way to add real value. You are there to support as much as you are there to challenge. --- There you have it, folks - [Christopher Spencer's](https://www.linkedin.com/in/christopher-spencer/) top four tips for becoming a strategic finance business partner. We hope you found these tips helpful and insightful, and that they've given you the tools you need to take your finance career to the next level. Remember, becoming a finance business partner is all about building relationships, communicating effectively, and being a trusted advisor to other departments. By following Christopher's advice, you'll be well on your way to success in this exciting and rewarding role. --- ## **Master the art of business partnering & storytelling** Unlock the power of storytelling and transform your role in finance with our [**Business Partnering & Storytelling**](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) course. Learn how to make data speak and influence strategic decisions that matter. This course gives you immediate access to five hours of dynamic video content, presentation slides, and hands-on resources. You’ll get practical insights from **Christian Wattig**, FP&A expert, on how to deliver impactful business insights and foster meaningful relationships that drive organizational success. Enhance your communication and business partnering skills today. **Sign up and start your journey now!** [Sign up](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) ### How to master the 5 Pillars of CFO leadership URL: https://www.financealliance.io/cfo-leadership-pillars/ Last updated: 2025-04-05T07:36:51.000Z CFO leadership isn’t just about flexing your financial muscles. It's also about inspiring your team, adapting to change, and navigating complex challenges. According to [IBM](https://www.ibm.com/thought-leadership/institute-business-value/en-us/c-suite-study/cfo), CEOs view the CFO as playing the most crucial role in their organizations over the next two to three years. This means stepping into the role of leader and driving value through the organization. However, to do that effectively, CFOs must "*optimize their own potential and that of their teams*." Keep reading to learn more about the five pillars of finance leadership to help you steer your team (and organization) toward success with unwavering confidence. 1. [Strategic thinking](https://www.financealliance.io/p/b06bae5d-e76c-4f9a-a2f5-ad41289cdda4/#1-strategic-thinking) 2. [Communication](https://www.financealliance.io/p/b06bae5d-e76c-4f9a-a2f5-ad41289cdda4/#2-communication) 3. [Integrity](https://www.financealliance.io/p/b06bae5d-e76c-4f9a-a2f5-ad41289cdda4/#3-integrity) 4. [Adaptability](https://www.financealliance.io/p/b06bae5d-e76c-4f9a-a2f5-ad41289cdda4/#4-adaptability) 5. [Teamwork](https://www.financealliance.io/p/b06bae5d-e76c-4f9a-a2f5-ad41289cdda4/#5-teamwork) ## 5 finance leadership pillars for CFOs ![5 pillars of CFO Leadership](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/data-src-image-prsd91trjb.jpeg) ## 1\. Strategic Thinking As a CFO, you're no stranger to the importance of strategic thinking. After all, a large part of the job is about seeing the bigger picture, anticipating trends, and navigating complex challenges to drive lasting success. ### Why is strategic thinking so important in CFO leadership? Strategic thinking goes beyond numbers. It's about connecting the dots and understanding exactly how your financial decisions affect the company's goals. By learning to think more strategically, you’ll be in a better position to offer key insights and make informed decisions to steer the company toward further growth. ### How to anticipate trends and identify potential opportunities To succeed as a CFO, you've got to keep an eye on emerging trends in your industry and the economy as a whole. So, start making a habit of reading financial news, attending [industry events](https://events.financealliance.io), and participating in relevant discussions. This will not only help you spot potential opportunities but also prepare you to tackle any challenges that may arise. ### Navigating complex challenges No matter your profession, you're bound to come across some challenges along the way. For a CFO, one of the best ways to overcome these challenges is to approach each situation with a growth mindset. Ask yourself, *"What can I learn from this?"* and *"How can I turn this challenge into an opportunity?"* By embracing a solutions-oriented mindset, you'll be well on your way to mastering strategic thinking as one of the most important leadership pillars. ### Tips to enhance strategic thinking skills - Create a [SWOT analysis](https://www.competitiveintelligencealliance.io/competitor-swot-analysis/) to assess your company's strengths, weaknesses, opportunities, and threats. - Set aside time for reflection and brainstorming, allowing yourself to think creatively and explore new ideas. - Collaborate with colleagues and mentors to gather diverse perspectives and insights. Remember, strategic thinking is an ongoing process, so don't forget to revisit and reassess your strategies regularly. Stay open to new ideas and be prepared to adapt as needed. --- ## 2\. Communication Communication is crucial for any leader. As a CFO, it's your job to clearly articulate financial insights to stakeholders and encourage collaboration across multiple departments. ### Why effective communication is so important Effective communication is key to ensuring that your team, colleagues, and stakeholders understand your financial vision and strategy. By improving communication skills, you can build trust, gain buy-in, and create a collaborative environment that drives success. ### Communicating financial insights to stakeholders To communicate complex financial information effectively, you must tailor your message to your audience. Focus on presenting data in a clear, concise, and visually appealing manner. You can do this by using [data visualization storytelling](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) techniques and presenting data using charts, graphs, heat maps, etc. It's also worth remembering that stakeholders will likely want more clarity or information to help them understand the bigger picture or intent behind the data. So, make sure that you are as prepared as possible and expect to answer questions or provide additional context when needed. ### Creating a collaborative culture Encourage open dialogue and create a culture where everyone feels comfortable sharing ideas and perspectives. This will not only lead to better decision-making but also create a more inclusive and engaged work environment. ### Tips to improve communication skills - Practice active listening and ask open-ended questions to encourage conversation. - Develop your storytelling [CFO skills](https://www.financealliance.io/top-10-cfo-skills/) to make financial information more relatable and engaging. - Use visual aids, such as graphs and charts, to simplify complex data. --- [Top 10 must-have Chief Financial Officer skillsThe modern CFO wears multiple hats and must master a variety of skills. But what skills does the CFO of the future need to stay on top? Here are the top 10 skill sets for CFOs of tomorrow.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/arrow-gb0e6f39dd_1920.jpg)](https://www.financealliance.io/top-10-cfo-skills/) --- ## 3\. Integrity Integrity is the backbone of any [successful CFO](https://www.financealliance.io/10-cfo-personality-traits/) and one of the most important pillars of leadership. As a CFO and leader, it's up to you to uphold ethical standards and practice a culture of transparency and accountability. ### The role of integrity in CFO leadership Integrity is vital in establishing trust and credibility within your company and with external stakeholders. By acting with honesty and fairness, you'll set a positive example for your team. In turn, this will help you create a strong foundation for long-term success. ### Upholding ethical standards in financial management Make sure your organization follows all relevant laws and regulations and adheres to the highest ethical standards. This includes: - Maintaining accurate financial records - Conducting regular audits - Addressing potential issues as efficiently as possible ### Increasing transparency and accountability Leading the finance team comes with a host of duties including building a culture of transparency and accountability. To do this, you could start by encouraging open communication and providing regular updates on financial performance, goals, and challenges. Hold yourself and your team accountable for your actions, and always be willing to learn from mistakes and grow. ### Tips and tools to maintain and promote integrity in the workplace - Develop and implement a code of ethics for your organization. - Provide regular training on ethical conduct and compliance. - Establish clear reporting mechanisms for employees to voice concerns or report misconduct. --- ## 4\. Adaptability In today's rapidly evolving financial landscape, CFOs must embrace change, continuously learn, and drive innovation. ### Embracing change Change is inevitable, and as a CFO, it's important to stay agile and adapt to new trends, technologies, and challenges. By being open to change, you'll be better prepared to capitalize on emerging opportunities and steer your organization through uncertain times. ### Continuous learning and development Never stop learning! Invest in your personal and professional growth by attending workshops, conferences, and online courses. This will not only help you stay current with industry trends but also enable you to bring fresh insights and ideas to your organization. ### Driving innovation As a leader, it's your responsibility to create an environment where innovation thrives. Encourage your team to think creatively and take calculated risks, and be prepared to challenge the status quo when needed. ### Tips to enhance adaptability and resilience - Stay informed about industry trends and emerging technologies by subscribing to relevant publications, blogs, and podcasts. - Encourage a culture of experimentation and learning from failures within your organization. - Develop a strong network of peers and mentors to exchange ideas and best practices. --- [How to become a fractional CFO | Finance AllianceMany CFOs have left full-time positions to regain control of their careers and their time. But how did they do it? That’s what you’ll find out in this blog post as we uncover how to become a fractional CFO.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Fractional-CFO.jpg)](https://www.financealliance.io/how-to-become-a-fractional-cfo/) --- ## 5\. Teamwork Teamwork is one of the most important CFO leadership pillars. Therefore, it's crucial to empower and motivate your team to achieve shared goals and cultivate a high-performing culture. ### Why teamwork is so important Teamwork is essential for driving your company's financial success. By cultivating a cooperative culture, you can harness the combined expertise and talents of your finance team. This collaboration will allow you to make more informed decisions, develop better strategies, and ultimately reach your financial objectives. ### Empowering and motivating your team to achieve shared goals Create a supportive and inclusive environment where team members feel valued and inspired to contribute their best. Set clear expectations and provide the necessary resources, guidance, and feedback to help your team succeed. ### Tips to improve teamwork and team management skills - Develop strong relationships with your team members by investing time in one-on-one meetings and team-building activities. - Set clear, measurable, and achievable goals for your team and regularly track progress. - Foster a growth mindset by providing opportunities for professional development and skill-building. --- And there you have it! By mastering these 5 CFO leadership pillars, you'll be well-equipped to lead your organization toward financial success. Embrace strategic thinking, effective communication, integrity, adaptability, and teamwork to truly elevate your CFO leadership game. --- ### FAQs - Pillars of leadership What is the CFO role in leadership? The CFO plays a critical leadership role in an organization by overseeing financial management, providing strategic direction, and ensuring long-term financial stability. Additionally, a CFO contributes to the overall decision-making process, collaborates with other senior leaders, and communicates financial insights to stakeholders. How can a CFO balance their financial responsibilities with their leadership role? Balancing financial responsibilities with leadership involves prioritizing tasks, delegating when appropriate, and ensuring open communication with team members and stakeholders. A CFO should focus on both the strategic and operational aspects of financial management while also nurturing a positive, collaborative work environment that supports the professional growth of their team. How does a CFO's leadership style impact the organization? A CFO's leadership style can significantly impact the organization's financial performance, employee engagement, and overall culture. Effective CFO leadership fosters collaboration, innovation, and a solutions-oriented mindset, ultimately driving the organization towards its financial goals and long-term success. What are some common challenges CFOs face in their leadership role, and how can they overcome them? Common challenges for CFOs in their leadership role include managing change, ensuring compliance, navigating complex financial situations, and maintaining a work-life balance. To overcome these challenges, CFOs should stay informed about industry trends, invest in their personal and professional development, collaborate with peers and mentors, and prioritize self-care and stress management. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### Digitalization in finance: Top pitfalls and how to dodge them URL: https://www.financealliance.io/podcast/digitalization-in-finance/ Last updated: 2023-04-05T10:53:44.000Z The road to digitalization in finance is paved with many pitfalls and challenges, but thankfully, there are ways to make sure the journey is a smooth one. In this episode of the [Two Cents: Finance Talk podcast](https://www.financealliance.io/podcast-two-cents-finance-talk/?wchannelid=id4lbj7w42&wmediaid=6qx3gktbwu), you'll hear from Tejas Parikh, FP&A transformation specialist and Lead Consultant/Director at Akshar Business Consulting Ltd. Tejas talks about why many finance professionals are stuck in the past and how you can implement digitalization in finance successfully within your organization. **Tejas spoke to us about:** - [Why it’s time to move on from Microsoft Excel](https://www.financealliance.io/p/2c5329d7-1863-4065-9047-aa1c4e927156/#why-it%E2%80%99s-time-to-move-on-from-microsoft-excel) - [Why digitalization in finance is about changing the ways we work](https://www.financealliance.io/p/2c5329d7-1863-4065-9047-aa1c4e927156/#finance-transformation-is-about-changing-the-ways-we-work) - [The importance of embracing technological change in finance](https://www.financealliance.io/p/2c5329d7-1863-4065-9047-aa1c4e927156/#the-importance-of-embracing-technological-change-in-finance) - [Drive finance transformation from the top down, but deliver it from the bottom up](https://www.financealliance.io/p/2c5329d7-1863-4065-9047-aa1c4e927156/#drive-finance-transformation-from-the-top-down-but-deliver-it-from-the-bottom-up) - [Why the fear of change is preventing finance transformation](https://www.financealliance.io/p/2c5329d7-1863-4065-9047-aa1c4e927156/#fear-of-change-is-preventing-finance-transformation) - [The major pitfalls of digital transformation in finance](https://www.financealliance.io/p/2c5329d7-1863-4065-9047-aa1c4e927156/#the-major-pitfalls-of-digital-transformation-in-finance) - [How technology can improve work-life balance](https://www.financealliance.io/p/2c5329d7-1863-4065-9047-aa1c4e927156/#how-technology-can-improve-work-life-balance) - [Top tips for successful digitalization in finance](https://www.financealliance.io/p/2c5329d7-1863-4065-9047-aa1c4e927156/#top-tips-for-successful-finance-transformation) Listen to Tejas' interview below, or keep reading the full blog version of this episode: ## Why it’s time to move on from Microsoft Excel For anybody who’s still working on Excel, you're stuck in the 1980s. It might be controversial, but people who know me know I never shy away from controversy, and I do like to make statements like this. Not to grab attention, but to stimulate thinking. We’re finance professionals. And most finance professionals I've worked with are at least partly if not fully qualified charters. And with all their training and qualifications, they’re happy to continue to do things the way they’ve always been done. And I just think, *You’re so well qualified, why are refraining from thinking differently?* That’s wrong. The whole idea of educating a population isn’t so they don’t think and don’t challenge themselves. That's not good. So I tend to make controversial statements very respectfully from the perspective of getting people to think. *Do I really need to be stuck in Excel? Is there a better way of doing these things? Maybe I should at least consider the options.* The purpose is not to criticize Excel. I love Excel as well and I still use it. But it has its place. We have to move with the times and use the right tools for the right things. --- [How FP&A machine learning is powering a new era of financeBy automating manual processes and utilizing advanced algorithms, it’s never been easier to access in-depth insights and predictions. But the question still remains – is it time to say goodbye to manual FP&A processes for good?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/FP-A-machine-learning.jpg)](https://www.financealliance.io/fpa-machine-learning/) --- ## Digitalization in finance is about changing the ways we work The role of finance in most organizations has become much wider because of the fact that it’s responsible for performance management, creating accountability, creating a clear vision of how the business is operating, and how that impacts your bottom line. The role of finance has expanded, but that doesn't mean you can have 200 or 500 finance people. That's not happening. Nobody out there is saying, “I'm going to quadruple my finance sector.” So it’s essentially a problem of, ‘do more with less.’ And that’s where finance transformation comes in. Digitalization in finance is about changing how we work and our ways of working. People talk about different ways of working on LinkedIn and other parts of social media, but in my world, ways of working are how your people, processes, technology, and data interact with each other. So for me, when I say [finance transformation](https://www.financealliance.io/your-guide-to-finance-transformation/), I mean the ways of working need to be transformed. That doesn't mean you're going to get aliens replacing people. You're still going to have the same people. But the way people are working with the kinds of technology, in the manner and process they're following, in the sequence of events, and with the data they have, *that* interaction needs to change. I’ll give you a simple example. To do a board report, businesses take five to seven days on average. The clients that I end up working with say it takes a minimum of five to seven days, but a lot of them take two weeks to create a board report. That needs to change. Imagine, first of all, that it takes at least a week or 10 days to close your books, and then two weeks to designate somebody to do the report. By the time that report has come out, your second month is over. It’s irrelevant data now. So digitalization in finance basically means changing the way we operate and challenging ourselves on a consistent basis to improvise and do new things. ## The importance of embracing technological change in finance Why don't we use calculators today? Why don't we do pen-and-paper accounts with calculators? Why do you use an ERP? How many businesses do you know that don't have an ERP and do day-to-day bookkeeping on Excel or with pen and paper and a calculator? Not many. Definitely not in the Western world, I'd say. What’s happened is that FP&A and your business partners haven’t moved from that Excel book to somewhere else. In the last 10-20 years that I’ve been in the industry, I've seen a lot of research being done and a lot of offerings in the market emerge to help improve the month-end. Do businesses still have that challenge? I'm not saying it's solved, but that’s been ongoing in business, even implementing ERP, SAP, Oracle, Microsoft Dynamics, you name it. > "FP&A hasn’t kept pace with the change of technological transformation." Technology was very costly when it started out, and now it’s become a lot more cost-effective. It's a much more competitive landscape, which means it’s not going to cost you $500,000 for every transformation you do. It doesn't need to cost you an arm and a leg... *or* a kidney. So modern finance teams need to embrace new technology because the scope has increased and you’ve got to keep up with it. And you either take that on the front foot and own that and say, “*Yes, I’ll take on finance as a function. I’ll take up more responsibility and do better performance management and data management, and I’ll do that by embracing new technology*.” Otherwise, you'll become irrelevant, or you’ll become somebody who keeps the books in the back end, and that's about it. > "To sit at the strategic table and be an influence in that boardroom, you need to embrace new technology. And I can say that with confidence because I’ve seen it done right, and I've seen it done wrong." I’ve sat with a CFO in a boardroom and I've seen how marketing, sales, all operations, and R&D leaders are dominating the conversation. And finance doesn’t get a say in most things because they're not bringing anything new to the table. They’re just not adding value. And therefore, you’re just going to have to sit quietly and listen to what you're being told. > "You’ll either lead or be led. It's not very complicated. To lead, essentially, you need to have your house in order by embracing new technology and making sure that you can go into that boardroom and be at the strategic table, and actually pose the right positive challenging questions to add to the strategy of the business." Either be part of the change or be dragged into the change. You don't have a choice. --- [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) --- ## Drive digitalization in finance from the top down, but deliver it from the bottom up First of all, for finance transformation, I’d say finance is responsible. There are a lot of times when I’ve seen IT guys try to change finance. It doesn't work. IT or a CIO can support a finance transformation. That’s critical. Without their support, you can't do it. But they can’t *lead* finance transformation. Anybody outside finance shouldn’t be leading digitalization in finance. It should be led by finance. But having said that, whether it’s the CFO or the finance team, the answer is always singular. In my world, transformation is basically driven from the top down, but delivered from the bottom up. And this is basically what most people fail at. Either they try to drive it bottom up, which won’t work, or they try to deliver top down. I’ve seen some disastrous outputs from it because respectfully, the C-suite doesn't know every Excel book and every manual process out there. It's not a criticism, it's just not what they do. So the delivery of the final transformation and for it to be able to speak is important. Otherwise, you do a final transformation and the transformation team goes away in three to six months, and then people are like, “*Let me go back to Excel because that's how I've always done it*.” > "For you to have really sticky finance transformation, it needs to be delivered from the bottom up. But it has to be driven top-down because very few people are going to embrace change." I've been told a few times that I'm losing my head because I like change. I can't do the same thing over and over again, whereas other people are just unwilling to move out of their comfort zone. So to move from the comfort zone, it has to be driven from the top down because when your C-suite says, “This needs to change,” people listen. Once people start listening, you need to listen to them as well. That's the second leg, which is very important. If you don't listen to them, you’ll implement a transformation or a change of trust where either you’ll miss something, or people don't have any stake in it. > "This morning, I was reading an interesting LinkedIn post about the IKEA effect. We like our IKEA furniture because we have to build it ourselves. And because you went through the pain, you love it. > It’s the same with transformation. If you involve the last foot soldier in the transformation, they have a stake in it, and therefore they won’t go back to their old ways of doing it." ## Fear of change is preventing finance transformation If I had a pound for every time somebody told me, “*We’ve always done it like that*,” I'd be a millionaire by now. It's a fear of change, a lack of clarity, and a lack of visionary leaders. Leaders need to think beyond this week, this month, or even next quarter. They need to think one year, three years, and five years ahead. - How is my business growing? - What are my cost or [cash flow drivers](https://www.financealliance.io/cash-flow-drivers-in-a-business/)? - How am I going to support this business? - Do I have the infrastructure in place? - Am I making the right investments today? There’s a lack of understanding of technology. There’s also a limit to us as people who love technology as well. We need to be able to show use cases of exactly what changes for you tomorrow morning. There’s basically apathy: “*They’ve already done it that way. I don't want to change Why do I need to change? I love Excel*.” Finance transformation is a way of life, even for an Excel lover. Think of it this way. Does he make an Excel book and then leave it like that all his life? No. Most people that I've seen work with Excel will keep improvising upon it, and they’ll work on it as they learn new formulae or new formatting. Today, new technologies are coming in about every three months, so it's about being able to keep up at least a certain level with the pace. With [transformation](https://www.financealliance.io/5-change-management-strategies-finance-transformation/) as a way of life within finance, that’s the only way. Otherwise, yes, there’ll always be leaders who’ll lead digitalization in finance, and then there'll be people who you'll have to drag across, people who push back. So if you make it a business culture, then it makes a very big difference. I've seen it succeed, especially at GE Healthcare. If you ever went to your boss and said you had a problem, he'd say, “*Don't come to me with a problem. Come to me with a solution or a proposal*.” We were always open to transformational ideas. You’d go to someone with a transformational idea and say, “*I want to change this. I don't like this. I can change it like that*.” Does it make sense? Will it work? Do a pilot run and see what happens. --- **Fun fact:** *85% of finance teams are currently undergoing or planning a [finance transformation](https://www.gartner.com/en/finance/insights/finance-transformation). However, 70% of finance transformation initiatives fail to deliver the forecast benefits to the business.* --- [5 CFO change management strategies: finance transformationWith the right approach, you can effectively manage this resistance and bring your finance team into the modern age of digitalization and in this blog post, we’ll show you how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Change-management-strategies-for-cfos.jpg)](https://www.financealliance.io/5-change-management-strategies-finance-transformation/) --- ## The major pitfalls of digitalization in finance Data. People don't have data discipline, so the quality of data is one reason. The other reason is that people are trying to implement change top-down, which doesn't work because your C-suite is telling you what they think about how the business works, and if you don't involve the ground soldiers, then you don't know how it really works. And therefore, you miss a lot of stuff. You have to put people at the heart of transformation. My transformation philosophy when I work with my clients is that it’s the people who come first. Who are the people? What are they doing on a daily basis? How are they doing it? Things like that. Then you start going into the process. So people, process, and then technology that can help that process and people, and also generate data that’s the most relevant and well-organized. It's a very fine-tuned machine. When one piece falls out of place you get a disaster. And I've been a part of a couple of disaster recovery stories. When you point it out to people they say, “How did we miss this?” You don't have the data organized. Or you made up this model, but the guys were really actually doing the forecast. They don't work like this. They work on a customer level or on a product code level. Forecasting is too high level. It doesn't work. How did you not think of it? Because you didn't ask. You assumed. ## How technology can improve work-life balance Technology doesn’t just mean improved productivity. It also means a better work-life balance. You don’t have to work for 12 hours. Work eight hours effectively and get the hell home. I love my wife and my kid, and I want to come home and feed them. And I’d like that for everybody. It's all good and well to say we should all talk about mental health and work-life balance on LinkedIn. Make it part of your finance transformation business case and see what it does to the motivation of your people. You want more dedicated people who want to work for the betterment of the business, but what are you doing for those people? There’s all this conversation about how people should be better finance business partners. What about if they don't do a month-end properly and they go and talk to the business? Are you going to take that? I don't know if a CFO is going to take that. So for them to be better finance business partners, have better mental health, and a work-life balance, make your routine tasks small, efficient, and less resource intensive so that they have time for all this. Everybody gets 24 hours in a day, and time is a great equalizer. --- ## Top tips for successful finance transformation ### 1\. Start small Firstly, start small. I don't like finance transformation programs that sweep over six months with the goal to transform the entire finance team. Start small, but have a consistent approach. “This quarter, we'll change this and see how that runs while we change that in the next quarter.” Make it an elongated process. ### 2\. Consider a third party Secondly, get a third party. Let an outsider come in and look at stuff because sometimes you can’t see the wood for the trees. ### 3\. Drive from top down, deliver from the bottom up Third is, as I’ve said a number of times now, to drive it from the top down, but deliver from the bottom up. Don't forget your bottom guys because otherwise, it’s going to be very difficult to transform your finance functions. ### 4\. Explore technology options Also, go out and look at technological options. Every business has different ways of working, so at least look at three suitors before you buy something. One of my bosses once said to me, “*If it was your money, how would you spend it?*” Don't think of it as a business. So do these basic things, and honestly, the outcome of digitalization in finance can be very different. The first thing is to do quarterly plans for small wins as you go along, because when you do it like that, what happens is that you know what works and what doesn't work. And then you can fix it. If you try to do everything in broad strokes, what happens is that you miss the detail. But the devil still lives there. The devil is still in the details and you can't miss anything. ### About Tejas ![Digitalization in finance - Two Cents podcast with Tejas Parikh](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/Digitalization-in-finance.png) [Tejas Parikh](https://www.linkedin.com/in/tejasparikh/) is a Financial Planning & Analysis Transformation Specialist and the Founder/Lead Consultant at Akshar Business Consulting. With over 18 years of experience in the industry, Tejas has helped businesses significantly improve their forecasting speed and effectiveness, creating connected planning environments and optimizing resource allocation. As an expert in FP&A transformation, he assists finance leaders in overcoming manual processes, disparate systems, and technological challenges. Tejas is passionate about transforming planning processes, moving from traditional budgeting practices to xP&A models, and revolutionizing reporting by establishing a single source of truth. By leveraging Power BI and Corporate Performance Management technology, he delivers real-time insights and smart visualizations that empower data-driven decision-making and contribute to a company's bottom line. --- ### FAQs - Digitalization in finance What are the main drivers of digitalization in finance and finance transformation? The main drivers of digitalization in finance include evolving customer expectations, competitive pressure from fintech companies, the need for cost reduction, regulatory changes, and advancements in technology such as AI, big data, and cloud computing. How can FP&A teams overcome resistance to digital transformation? By fostering a culture of innovation, investing in employee training and reskilling, developing a clear digital strategy, and ensuring strong leadership support for the transformation process. How can digitalization help improve financial forecasting and decision-making? Digitalization enables advanced data analytics, real-time insights, and machine learning, which can improve the accuracy of forecasts, optimize resource allocation, and help businesses make more informed, data-driven decisions. What are the main challenges finance teams face during the digital transformation journey? Some key challenges include legacy systems, data security and privacy concerns, regulatory compliance, lack of digital skills, and resistance to change. --- ### Download the Digital Transformation in Finance eBook Learn how to master the operational and financial processes that underpin digital transformation success. Download our eBook, *[Digital Transformation in Finance: How CFOs can save on software and scale](https://www.financealliance.io/digital-transformation-in-finance-how-cfos-can-save-on-software-and-scale/) (*courtesy of Cledara). [Digital Transformation in Finance | Finance AllianceGrab our latest eBook and set yourself up for digital transformation success and drive value with proven strategies that you can implement today.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceCledara![](https://images.unsplash.com/photo-1571171637578-41bc2dd41cd2?crop=entropy&cs=tinysrgb&fit=max&fm=jpg&ixid=MnwxMTc3M3wwfDF8c2VhcmNofDJ8fHNvZnR3YXJlfGVufDB8fHx8MTY4MDEwNDUwMw&ixlib=rb-4.0.3&q=80&w=2000)](https://www.financealliance.io/digital-transformation-in-finance-how-cfos-can-save-on-software-and-scale/) ### The CFOs guide to effective SaaS cost management: 9 tips for managing spend URL: https://www.financealliance.io/saas-cost-management/ Last updated: 2025-04-07T10:13:35.000Z Over 70% of CFOs consider digital transformation a top priority, but many still haven't implemented it due to the constraints of limited budgets. The solution? SaaS cost management. By proactively addressing SaaS spend, you can mitigate risks, secure cross-department access, and avoid common buying mistakes that can quickly inflate expenses. In this blog post, we'll dive deep into the world of software management, revealing its game-changing importance and serving up some strategies for optimizing SaaS spend. **Table of contents:** - [What is SaaS cost management?](https://www.financealliance.io/p/a1b4469c-c698-4cca-86cc-e4dd3147296c/#what-is-saas-cost-management) - [The role of CFOs in SaaS cost management](https://www.financealliance.io/p/a1b4469c-c698-4cca-86cc-e4dd3147296c/#the-role-of-cfos-in-saas-cost-management) - [Top CFO challenges in SaaS cost management](https://www.financealliance.io/p/a1b4469c-c698-4cca-86cc-e4dd3147296c/#top-cfo-challenges-in-saas-cost-management) - [How to identify and categorize SaaS expenses](https://www.financealliance.io/p/a1b4469c-c698-4cca-86cc-e4dd3147296c/#how-to-identify-and-categorize-saas-expenses) - [9 tips to help CFOs manage SaaS spend](https://www.financealliance.io/p/a1b4469c-c698-4cca-86cc-e4dd3147296c/#9-strategies-to-help-cfos-manage-saas-spend) - [SaaS spend management software](https://www.financealliance.io/p/a1b4469c-c698-4cca-86cc-e4dd3147296c/#saas-spend-management-software) ## **What is SaaS cost management?** SaaS cost management is the practice of overseeing and controlling expenses related to cloud-based software-as-a-service (SaaS) applications. It involves tracking, analyzing, and optimizing costs associated with SaaS subscriptions to ensure maximum value and minimize unnecessary spending. SaaS spend optimization, on the other hand, focuses on strategically aligning the use of SaaS applications with business goals and eliminating waste. This includes right-sizing licenses, negotiating better pricing, and identifying underutilized or redundant software to cut costs and enhance efficiency. With global cloud adoption skyrocketing, it's more important than ever to have a handle on SaaS cost management. [Gartner](https://www.gartner.com/en/newsroom/press-releases/2021-08-02-gartner-says-four-trends-are-shaping-the-future-of-public-cloud) forecasts that by 2026, public cloud spending will account for over 45% of all enterprise IT spending, a massive leap from less than 17% in 2021\. Given these eye-opening statistics, it's clear that SaaS cost management is essential for organizations looking to stay competitive and harness the power of the cloud *without* going over budget. --- [Digital Transformation in Finance | Finance AllianceGrab our latest eBook and set yourself up for digital transformation success and drive value with proven strategies that you can implement today.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceCledara![](https://images.unsplash.com/photo-1571171637578-41bc2dd41cd2?crop=entropy&cs=tinysrgb&fit=max&fm=jpg&ixid=MnwxMTc3M3wwfDF8c2VhcmNofDJ8fHNvZnR3YXJlfGVufDB8fHx8MTY4MDEwNDUwMw&ixlib=rb-4.0.3&q=80&w=2000)](https://www.financealliance.io/digital-transformation-in-finance-how-cfos-can-save-on-software-and-scale/) --- ## **The role of CFOs in managing SaaS cost** As stewards of financial resources, [CFOs play an important role in SaaS](https://www.financealliance.io/top-10-saas-cfo-duties/) cost management. After all, when the company wants to reduce SaaS spend, the CFO is almost *always* the first person everyone looks to for solutions. They’re responsible for developing and implementing strategies that ensure the company's investments in SaaS applications align with its growth objectives and deliver a solid return on investment (ROI). This involves working closely with IT, procurement, and business unit leaders to make informed decisions about software purchases, renewals, and usage. So, what does this mean for you as the CFO? Well, you’ll need a clear understanding of your company's software landscape, including the total cost of ownership (TCO) for each SaaS application. You’ll also need to establish a robust governance framework that: - Streamlines procurement - Centralizes data - Enforces policies to optimize SaaS spending - Reduces risks associated with decentralized purchasing Not to mention, a well-optimized SaaS cost management structure can significantly contribute to your department’s finance transformation journey. As organizations embrace [digital transformation](https://www.financealliance.io/digital-transformation-in-finance-how-cfos-can-save-on-software-and-scale/), CFOs must find ways to save on software while maintaining the efficiency and performance required by the organization. By proactively managing software expenses, you can free up resources that can be reinvested in strategic initiatives that improve financial processes (such as forecasting, modeling, etc.) as well as drive business growth and innovation. Some of the benefits of efficient SaaS cost management include: - Cost savings - Improved productivity - Enhanced security and compliance - Better decision-making --- [Top 10 SaaS CFO duties for scaling an epic SaaS companywhat are the main SaaS CFO duties on your plate? And what can you do to lead the finance team and the company to roaring success? In this article, we’re diving into the top 10 SaaS CFO duties for scaling an organization to new heights![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/SaaS-CFO-Duties-2.jpg)](https://www.financealliance.io/top-10-saas-cfo-duties/) --- ## **Top CFO challenges in SaaS cost management** ### Shadow IT and decentralized purchasing CFOs, brace yourselves for shadow IT and decentralized purchasing – two sneaky culprits that can mess with your [SaaS management ](https://www.cledara.com/saas-management)efforts. They creep in when employees or departments buy software *without* looping in IT or finance, making it tough to keep track of spending and spot security risks. ### **Inefficient contract management** Many CFOs struggle to manage contract terms, renewal dates, and usage limits. But with a little organization and vigilance, you can master contract management, snag better deals, and avoid surprise expenses. ### **Incomplete or inaccurate usage data** A clear view of SaaS usage is crucial for CFOs but gathering accurate data can be a difficult task. Don't let incomplete or inaccurate info derail your cost management efforts – dive deep into the data, spot underutilized or redundant software, and optimize your licenses. ### **Balancing cost and performance** Last but not least, it's all about finding that sweet spot between cost savings and performance. While trimming SaaS expenses is essential, going overboard can stifle productivity and innovation. Assess the value and impact of each tool to ensure your cost-cutting moves don't hamper your organization's growth and success. --- ## **How to identify and categorize SaaS expenses** You can't optimize what you can't see. So, first things first, it's time to shine a light on all those SaaS expenses hiding in the nooks and crannies of your company. Gather data from every department, and don't forget to include any off-the-books subscriptions that might be lurking. The more thorough you are, the better your chances of finding hidden cost-saving opportunities. Now, let's talk about categorization. To make sense of your SaaS expenses, sort them into meaningful categories that align with your organization's structure or goals. Think of it as putting together a SaaS spending puzzle – each piece will fit neatly into place, revealing a complete picture of where your money's going. By gaining total visibility into your SaaS spending, you'll be empowered to make data-driven decisions that'll positively impact the bottom line. --- ## **9 tips to help CFOs manage SaaS spend** Ready to optimize your [SaaS spend](https://www.futureofsaas.io/saas-finance/) and make every dollar count? We've got some practical, tried-and-true strategies to help you prioritize SaaS spend optimization. ### 1\. Renegotiate contracts ![SaaS cost management tip - renegotiate contracts](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/SaaS-cost-management.png) Don't be shy about negotiating with vendors – they want to keep you happy, too! Review your contracts regularly and look for opportunities to score better deals, such as volume discounts or more favorable terms. ### 2\. Consolidate software licenses ![SaaS cost optimization - tip 2 - consolidate software licenses](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/SaaS-software-management.png) If you have too many SaaS licenses to keep track of, it's time to consolidate. Review your software inventory, identify any overlaps or redundancies, and streamline those licenses for maximum efficiency (and minimum cost). ### 3\. Cut unused or redundant subscriptions ![software management tip 3 - cut unused or redundant subscriptions](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/software-management.png) Keep an eye out for subscriptions that are collecting digital dust. If they're no longer needed, cut them loose, which will help reduce SaaS spend. ### 4\. Create a centralized procurement process ![reduce saas spend tip 4 - create a centralizes procurement process](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/reduce-saas-spend-tip-4---create-a-centralizes-procurement-process.png) By bringing all your software purchases under one roof, you'll avoid the chaos of fragmented and duplicated spending. With a clear, organized system in place, you can make smarter purchasing decisions and keep costs in check. ### 5\. Track and monitor usage ![Manage SaaS sped tip 5 - track and monitor usage](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/manage-saas-spend.png) Keep a close eye on how your team is using SaaS tools. By cracking the case on underutilized tools, you'll unlock data-driven decisions about reallocating or trimming subscriptions. ### 6\. Align SaaS purchases with business goals ![Tip 6 - Align SaaS purchases with business goals](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/CFO-tips-for-reducing-costs-on-software.png) Before you splash out on a new SaaS tool, make sure it's in sync with your organization's goals and adds real value. This helps ensure your investment contributes to your business growth and success. ### 7\. Encourage cross-department collaboration ![Tip 7 - Encourage cross-department collaboration](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/Encourage-cross-department-collaboration.png) Get departments talking and sharing their SaaS needs. By joining forces, they can spot opportunities for shared tool usage, saving you big bucks on duplicate subscriptions and licenses. ### 8\. Opt for annual billing plans ![agile software management tip 8 - opt for annual billing plans](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/Agile-software-management.png) Many SaaS vendors offer discounts for annual billing plans over monthly ones. If the tool has proven its value and you plan to use it long-term, opting for an annual plan can lead to big savings. ### 9\. Test-drive SaaS tools ![Tip 9 - test SaaS tools](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/Saas-tools.png) Before committing to a paid SaaS subscription, take new SaaS tools for a spin with free trials or freemium models. This helps you make sure they're a perfect match for your organization, reducing the risk of costly mismatches. --- ## **Choosing the right SaaS management software** With so many SaaS spend management tools on the market, picking the right one can be a challenge. But fear not, we've got your back with a list of things to consider and a fantastic resource to help you out! Here's what to watch out for when selecting the right tool or software: 1. Seamless software discovery, purchasing, admin, and cancellation. 2. The ability to benchmark, cut costs, and set the right processes in place. 3. A positive impact on KPIs like employee churn, CSAT, ARR, cash flow, and compliance. To make your decision-making journey even smoother, we've got an amazing eBook (courtesy of Cledara) packed with insider info: "[*Digital Transformation in Finance: How CFOs Can Save on Software and Scale*](https://www.financealliance.io/digital-transformation-in-finance-how-cfos-can-save-on-software-and-scale/)." It's brimming with stats, insights, and actionable tips to help you choose the right tool and transform your organization's SaaS cost management. [Download the eBook now](https://www.financealliance.io/digital-transformation-in-finance-how-cfos-can-save-on-software-and-scale/) and unlock the secrets to conquering your SaaS cost management challenges.👇 --- ### FAQs - SaaS spend management What is SaaS cost management? SaaS cost management is the process of monitoring, analyzing, and controlling expenses related to cloud-based software-as-a-service (SaaS) applications. This practice aims to maximize value, minimize unnecessary spending, and ensure efficient use of resources across an organization's software subscriptions. How is SaaS cost calculated? SaaS cost is typically calculated based on the subscription model and pricing tier chosen by an organization. Factors that can influence the cost include the number of users or licenses, storage capacity, features, and functionality. Some SaaS providers may also charge additional fees for customization, integrations, or premium support. How do I optimize my SaaS spending? To optimize SaaS spending, you can regularly review and audit your software subscriptions, identify and eliminate unused or redundant applications, renegotiate contracts and seek volume discounts, consolidate software licenses, and adopt a centralized procurement process What is SaaS spend management? SaaS spend management is the practice of overseeing and controlling the costs associated with acquiring, using, and maintaining software-as-a-service applications within an organization. It involves strategic planning, budgeting, and monitoring of expenses to ensure optimal use of financial resources and alignment with business objectives. ### Chris Ortega shares his experience as a speaker at FP&A Summit URL: https://www.financealliance.io/chris-ortega-shares-his-experience-as-a-speaker-at-fp-a-summit/ Last updated: 2023-03-31T08:18:34.000Z The FP&A Summit in San Diego was a truly remarkable event, bringing together professionals and experts from the finance world to share insights, experiences, and best practices. Among the many outstanding speakers and thought leaders present, the conference featured [Chris Ortega](https://www.linkedin.com/in/freshcfo/ ), Fractional CFO and CEO of [Fresh FP&A](https://www.linkedin.com/company/freshfpa/). Chris' engaging presentation at the Summit captivated the audience and facilitated an open, interactive dialogue, showcasing his unique approach to financial planning and analysis. As an experienced speaker and expert in his field, Chris provided valuable insights while fostering an atmosphere of collaboration and connection among the attendees. We were fortunate to catch up with Chris after his talk to discuss his experience at the event, the preparation process for his presentation, and the impact it had on his professional development. ### What inspired you to become a speaker at our finance alliance event? I've always enjoyed speaking and really wanted to help the event and kick off the in-person experience. That's what inspired me to present. ### How did you prepare for your presentation? I've done this presentation before, so my main focus was on understanding the audience. I wanted to create an open conversation, which I think is a unique aspect of this conference compared to others. It was less about PowerPoint and more about open dialogue and communication. --- ![Chris Ortega testimonial](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/7.png) --- ### What were some of the challenges you faced during your presentation, and how did you overcome them? There were no challenges. As I said, I think for everybody, it was a lot more interactive and a lot more engaging, which was the intention of my presentation. So, I think if it wasn’t engaging with people, and people were not commutative and didn't want to share, it would’ve been more challenging. But I haven’t had many challenges during my presentations. ### How did the audience respond to your presentation? I think the audience reacted really well to it. As you can see from the session, you had a lot of people who wanted to share their insights, share their discussion, and share their perspectives. They responded really well to it. I received some great feedback. After the presentation, everybody told me how just awesome it was, noting the transparency and the ability to have open dialogue and conversation during the presentation. --- [FP&A Summit San Diego | Speaker TestimonialsWe recently held our first in-person event, the FP&A Summit, in San Diego. In this video and blog post, you’ll hear what some of the speakers thought of the event.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/FP-A-Summit---San-Diego---Speaker-testimonials-2.png)](https://www.financealliance.io/fp-a-summit-san-diego-speaker-testimonials/) --- ### What did you enjoy most about the event? What I enjoyed the most about the event was the interaction between everybody. Because it was a more intimate event, you had a lot more people to be able to connect and meet each other learn, and share different perspectives. The audience was really good. I think one of the standout moments for me was one of the panel conversations with all the different various leaders. You had people that were FP&A managers all the way up to FP&A experts such as CFOs. So, I really liked that panel and conversation. ### How do you think the event impacted your personal or professional development as a speaker? I've been doing this for a long time. What impacted me the most was definitely the personal development side of things and meeting more people, connecting with some great leaders I've never had the chance to present to or didn't even know about. So, I think from the professional side of it, I was able to discover some amazing presenters I wasn’t aware of before and build new connections. --- [Top finance events to attend | Finance Alliance2023 is set to be an exciting year with a range of finance events taking place around the world that offer opportunities to learn, network, and grow. Have your calendar ready as we drop the ultimate round-up of top finance events to attend in 2023.👇🏽![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Finance-events.jpg)](https://www.financealliance.io/top-finance-events/) --- ### Would you recommend speaking at our finance alliance event to other professionals in your field? I’d definitely recommend other presenters to come to talk at a Finance Alliance event, whether they're in finance, FP&A, a CFO, or a fractional CFO, etc. So, I’d recommend any other speakers to come to talk at an event. ### What advice would you give to other speakers who are considering presenting at our event? Just be authentic, be yourself, speak to your experience, and don't worry so much about the presentation, whether it’s going to be good, and the structure of it. Make it feel like more of a conversation and less of a presentation. That's always a tip I always think about when I'm presenting. I want it to feel like we're having very intimate conversations with a lot of different people versus me going to go give a college lecture or something like that. So that would be my advice. --- ![Chris Ortega testimonial](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/6.png) --- ### How did you benefit from networking opportunities at the event? I met some great people. I thought the networking opportunities were great even during Alpha sessions and connecting over lunch. It was so intimate and you had the ability to just go free and connect with everybody. ### Are there any topics or areas of expertise that you would like to see covered at future events? Um, I think this did a great job. We talked about technology. We talked about current issues, we talked about leadership, we talked about processes. I think we covered all the really great topics, and the presenters had a lot of depth and experience in the various courses and presentations that they were talking about. So overall, it was really great event. I loved the intimacy, loved the collaboration and connection with everybody, and loved the engagement from the audience. I thought the topics were great. So yes, it was a super successful event. The length of time for the sessions was great too. You kept it to around 45 minutes each, which is awesome. It was a really great event. If I was to score the event out of 10, I would say 8.5 out of 10 - Great job Finance Alliance FP&A Summit! --- ## Find out more about our upcoming events! Interested in speaking or attending our next [in-person event](https://events.financealliance.io)? Don't miss this fantastic opportunity to connect, network, and grow professionally in a collaborative and stimulating environment. ### Apply to speak ### Attend our next virtual event: Can't make it to an in-person event? No problem! We also host virtual events like the [CFO Summit](https://cfosummit23.financealliance.io/?%5Fgl=1%2A1px72ae%2A%5Fga%2AMTYxNzU4NjkxLjE2NzI3Mzk5MDI.%2A%5Fga%5F2NXFSBEP4N%2AMTY4MDI0MzA2NC4zMzQuMS4xNjgwMjQzNzU2LjAuMC4w), which offers the same high-quality content and networking opportunities as our in-person gatherings, all from the comfort of your own home or office. Whether you're a seasoned professional or just starting in the finance world, our events provide a platform to expand your knowledge, foster meaningful connections, and ultimately, contribute to the growth and success of your career. Don't wait – join us at our next event and be a part of our thriving finance community! ### Value creation plan: Uniting FP&A and risk management URL: https://www.financealliance.io/value-creation-plan/ Last updated: 2025-04-07T10:13:49.000Z Building a value creation plan that effectively unites FP&A and risk teams can be a game-changer for your organization. In this blog post (and video), [Stefan Gershater](https://www.linkedin.com/in/stefangershater/), the Director of Risk at Burberry, walks you through the process of collaboration between these two crucial teams to address both internal and external risks, while maximizing value in uncertain times. You can also watch a clip from Stefan’s talk at our virtual FP&A Summit, where he talks about how FP&A and risk teams can work together to create value. **Topics discussed:** - How understanding external risks and setting key milestones can pave the way for better collaboration and informed decision-making. - The significance of identifying internal risks and implementing controls to adapt and respond effectively. - How incorporating audit into the value creation process can boost confidence and facilitate better decision-making among stakeholders. Join us on this journey to transform your organization's approach to risk management and financial planning and unlock the true potential of a well-crafted value creation plan! **🎤If you want to hear more from great speakers like Stefan, don't miss our next virtual event,** [**CFO Summit**](https://cfosummit23.financealliance.io/?%5Fgl=1%2Ayqbrp6%2A%5Fga%2AMTYxNzU4NjkxLjE2NzI3Mzk5MDI.%2A%5Fga%5F2NXFSBEP4N%2AMTY4MDE3Mzc0Ny4zMjkuMS4xNjgwMTc3NDM0LjAuMC4w) **\- 🗓 May 10, 2023!** ## The value creation plan continuum A lot of risk teams will look at risk in isolation. They’ll give you (the finance team) a list of big scary things that may or may not happen. They'll talk about them once a year, and they'll get their time in the spotlight at the board, and that'll be that. They'll do okay and they'll probably get a bonus for that… and all is well with the world. But feel free to demand more from your risk team. Here’s how I think that can work. ### Understanding external risks and setting key milestones It starts with the external environment and flows through the following factors: > **External risks** > Identify external risks to guide ambitions and objectives. > **Key milestones** > Understand key milestones over three years which contribute to our financial and ESG objectives. > **Internal risks** > Identify internal risks impacting the ability to reach key milestones. > **Controls** > Identify investments to reduce risks to match risk tolerance. > **Audit** > Provide assurance over the previous steps. This involves identifying external risks to guide ambitions and objectives. However, it’s better to separate external risks. Why? Well, you can’t control external risks. You can’t stop anything from happening. You can't invest capital, and you can't invest OPEX into changing macroeconomic conditions. You can't invest in preventing technological revolutions or invest in societal expectations and norms. If you’ve completed an MBA, think back to what you learned about PEST analysis: Politics, Economics, Social, and Technology. All of that comes under this umbrella and neither you nor I can prevent these things from happening. I can't reduce the probability. But what I *can* do is sense it and prepare for it. And that's part of my job as a Director of Risk. It then flows straight to you guys in finance. The key milestones, that’s you. So what are the key things we need to deliver? > "Risk teams and finance must work together on that to figure out how those external risks flow." For example, I would model the risk using machine learning and AI, and then quantify that as best we can. We're going to say to the exco, “*Right, you set these targets, and this is what you decided you wanted to achieve with your business for the next three years*.” The risk team has modeled what might affect that. You can think of them like the tides, the wind, or the currents that push the business one way or the other. Once we’ve set milestones, we can measure how [external risk forces](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) will affect us. Finance teams can then course correct. So, as well as actuals from your business and recording revenue and margin figures, cash, and whatever else it is you're able to record and whatever your capabilities allow you to do, we're also now giving you an extra feed. We're saying, “*Yeah, the actuals went one way, but that could be because of market conditions, or we surpassed our expectations, and the market was going against us at the same time*.” Let's be optimistic here. So, we've got that flow of information starting from the outside, going into the business, and affecting whether or not we're going to achieve these milestones that we've set, which you helped us to do. --- [How to use Microsoft 365 Copilot in Excel | Finance AllianceIn a ground-breaking move, Microsoft has recently launched its highly anticipated Microsoft 365 Copilot, set to transform the daily work processes of finance professionals overnight.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-21-at-13.26.26.png)](https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/) --- ### Identifying internal risks and implementing controls That then flows into internal risks. So how am I going to respond to that? Here are just a few questions that you might need to consider: - Do I need more people? - Do I need fewer people? - Do I need to put more pressure on my supply chain? - What about the data that I'm using to support this information? - What about commercial aspects? - What about legal? All those enablers that every business has, we look at those in a *risk context*. ![Value creation plan FP&A and Risk Analysis](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Value-creation-plan.jpg) And then the controls are our way of responding to that. So, the investments that I need to make to get those risks into some sort of level where I feel comfortable, that I think is going to enable those milestones to be delivered to respond to those external risks. > "That flow of information flows in both directions. We're sensing things, but we're also *responding* to them." ### Creating confidence through audit And then finally, we come to our friends in audit. They're creating a really rare commodity, and that’s *confidence*. They're creating confidence in those previous four steps. We can really target those guys because they can add a lot of value. But if we target them appropriately across those external risks and across the key milestones, internal risks, and controls, we can target them at the things which are changing most rapidly or the things that give us the most cause for concern. If we look at value creation in this continuum in this way, audit really comes into its own and it creates that vital confidence that decision-makers need in order to make decisions as effectively as possible. --- ### FAQs - Value creation planning in finance and risk management How do you write a value creation plan? When you're crafting a value creation plan, you'll want to kick things off by setting clear objectives and pinpointing key performance indicators (KPIs). Dive into a deep analysis of your current financial and operational situation, and spot areas where you can improve or grow. Then, come up with initiatives that align with your objectives, and keep a close eye on progress to make sure everything's on track. What are the four types of value creation? There are four main types of value creation: operational, financial, strategic, and relational. Operational value creation is all about boosting efficiency and effectiveness. Financial value creation means fine-tuning your capital structure and financial performance. Strategic value creation revolves around competitive positioning and growth, while relational value creation focuses on building strong connections with stakeholders and customers. What is a value creation strategy? A value creation strategy is essentially a well-thought-out plan detailing how a company plans to create and increase value for its stakeholders. To craft this strategy, you'll need to identify key improvement areas, set measurable targets, and put initiatives into action that drive growth, profitability, and sustainability. What is value creation in finance? In the world of finance, value creation is all about raising a company's financial worth. You can achieve this by enhancing operational efficiency, allocating capital wisely, launching strategic growth initiatives, and nurturing stakeholder relationships. The end goal is to boost shareholder value and ensure the company stays financially healthy for the long haul. What is value creation in risk management? When it comes to risk management, value creation involves spotting, assessing, and mitigating risks that could put a dent in a company's financial performance and overall value. By managing risks effectively, companies can minimize potential losses, seize opportunities, and ultimately boost their value to stakeholders. How can financial strategies be useful for value creation? Financial strategies can be useful for value creation by optimizing capital allocation, improving financial performance, and fostering sustainable growth. By implementing effective financial strategies, organizations can reduce costs, increase revenues, manage risks, and create long-term value for stakeholders. --- ### Don't miss our next virtual event, Chief Financial Officer Summit! **When? - 🗓 May 10, 2023** Check out our cutting-edge [agenda](https://cfosummit23.financealliance.io/schedule/) full of leading keynote sessions and panel discussions and see what incredible [speakers](https://cfosummit23.financealliance.io/speakers/) we have lined up for the event! Did we mention it's free to attend live? Register now.👇 [Chief Financial Officer Summit May 2023Be a part of the forward thinking finance community![](https://s3.amazonaws.com/heysummit-production/media/uploads/events/revenue-marketing-festival-copy/Wxgde3FdE4xRJJW2o26RgH.jpg)Chief Financial Officer Summit May 2023HeySummit![](https://s3.amazonaws.com/heysummit-production/media/uploads/events/chief-financial-officer-summit-copy/iEoCBYAq9oUJ4RUBkSFLLb.png.png?updated=1680175881.077111)](https://cfosummit23.financealliance.io) ### 7 important cash flow drivers in a business URL: https://www.financealliance.io/cash-flow-drivers-in-a-business/ Last updated: 2026-03-19T09:29:54.000Z Cash flow drivers are vital to sustaining the life of a business. When cash flow is low, a string of issues arise. From struggling to pay suppliers to potential solvency problems, low cash flow must be avoided at all costs. So, what should you do as a finance professional to ensure cash flow is never in short supply? The answer is to start by focusing on the key cash flow drivers in a business. From there, you can start analyzing the current state of each source. Then, you can get to work and strategize a plan to keep cash flowing into the business. Keep reading to learn more about the definition of cash flow drivers and which ones you should focus on. **Topics covered:** - [What are cash flow drivers?](https://www.financealliance.io/p/093e4867-a371-46c6-91b5-bffc58c11256/#what-are-cash-flow-drivers) - [Importance of maintaining cash flow](https://www.financealliance.io/p/093e4867-a371-46c6-91b5-bffc58c11256/#importance-of-maintaining-cash-flow) - [The role of finance teams in managing cash flow](https://www.financealliance.io/p/093e4867-a371-46c6-91b5-bffc58c11256/#the-role-of-the-finance-team-in-managing-cash-flow) - [7 cash flow drivers in a business](https://www.financealliance.io/p/093e4867-a371-46c6-91b5-bffc58c11256/#7-cash-flow-drivers-in-a-business) - [Cash flow vs working capital](https://www.financealliance.io/p/093e4867-a371-46c6-91b5-bffc58c11256/#what-is-cash-flow-vs-working-capital) - [FAQs](https://www.financealliance.io/p/093e4867-a371-46c6-91b5-bffc58c11256/#cash-flow-drivers-in-a-business-%E2%80%93-faqs) ## What are cash flow drivers? Cash flow drivers in a business are key factors that influence a company's cash flow. They play a vital role in shaping its long-term financial health and growth potential. They also affect how much money comes in and goes out of a business as a result of strategic decisions. When you're trying to figure out a company's true value or predict its future success, understanding these cash drivers is *crucial*. By keeping an eye on the main [cash flow](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/) drivers of the business, you'll be in a better position to: 1. Evaluate growth prospects and profits 2. Assess the sustainability and trajectory of a business ## Importance of maintaining cash flow Maintaining cash flow is vital for a business's survival and growth. Not only does it ensure there are enough funds to meet financial obligations, but a healthy cash flow puts the business in a stronger position to invest in new opportunities and weather unexpected challenges. Healthy cash flow means the business can pay suppliers, employees, and lenders on time, fostering strong relationships and trust. Plus, positive cash flow attracts investors and can lead to better access to credit, further fueling growth. --- [3 cash flow forecasting challenges | Finance AllianceCash flow forecasting is a continuous process, and it’s normal to face challenges along the way. However, with some effort and determination, you can overcome these obstacles and improve your forecasting skills over time.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/labyrinth-g0189cfb72_1920.jpg)](https://www.financealliance.io/3-cash-flow-forecasting-challenges/) --- ## The role of the finance team in managing cash flow The finance team plays a pivotal role in managing cash flow within a company. Some key responsibilities of the finance team include: - Cash flow forecasting - Budgeting and financial planning - Monitoring and analyzing cash flow - Working capital management - Cost control and profitability - Capital expenditure management ![Drivers of cash flow - an image of a hand fanning cash](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/cash-flow-drivers.jpg) ## 7 cash flow drivers in a business Now that we've discussed the importance of cash flow, let's dive into the seven key cash flow drivers in a business. By understanding and optimizing these drivers of cash, you can take charge of your company's financial health and set the stage for sustainable growth. ### 1\. Revenue growth Revenue growth is the increase in a company's sales over time. It's a critical cash flow driver because it affects cash inflow. Top-performing companies focus on expanding their customer base, launching new products or services, and optimizing their marketing and sales strategies to [boost revenue](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/) growth. ### 2\. Gross margin Gross margin is the percentage difference between revenue and the cost of goods sold (COGS). A higher gross margin indicates that a company is generating more profit for every dollar of sales. To improve gross margin, consider: - Optimizing your pricing strategy - Reducing production costs - Negotiating better terms with suppliers ### 3\. EBITDA margins Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) margins measure a company's operating profitability. Healthy EBITDA margins signify the company's ability to generate cash from its core operations. If you want to improve EBITDA margins, focus on: - Cost control - Operational efficiency - Refining your product or service mix ### 4\. Capital Expenditure Capital Expenditure (CapEx) refers to investments in long-term assets, such as equipment, property, or technology. While necessary for growth, CapEx can tie up cash, impacting cash flow. To optimize CapEx to help increase cash flow, prioritize: - Projects based on potential returns - Improving budgeting and forecasting - Seeking alternative financing options like leasing or vendor financing ### 5\. Accounts receivable Accounts receivable represents the money owed to a company by its customers. As a cash flow driver, effectively managing accounts receivable can accelerate cash inflows. You can transform accounts receivable management for the better by: - Implementing a robust credit policy - Streamlining the invoicing process - Offering early payment incentives - Diligently following up on overdue payments ### 6\. Accounts payable Accounts payable is the money a company owes to its suppliers for goods or services. Managing accounts payable efficiently can help preserve cash flow by optimizing the timing of cash outflows. Some strategies to improve cash flow via accounts payable include: - Negotiating favorable payment terms with suppliers - Taking advantage of early payment discounts - Leveraging technology to automate and streamline the accounts payable process ### 7\. Working capital Working capital is the difference between a company's current assets and current liabilities. It's a key cash flow driver, as it reflects the company's ability to cover short-term financial obligations. To raise working capital management, focus on: - Reducing inventory levels - Keeping expenses under control - Collecting payments as soon as possible *\[Disclaimer: there are many more drivers of cash flow to consider, but these are the seven that we've chosen to discuss in more detail\]* --- [How FP&A machine learning is powering a new era of financeBy automating manual processes and utilizing advanced algorithms, it’s never been easier to access in-depth insights and predictions. But the question still remains – is it time to say goodbye to manual FP&A processes for good?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/FP-A-machine-learning.jpg)](https://www.financealliance.io/fpa-machine-learning/) --- ## What is cash flow vs working capital? Cash flow refers to the inflow and outflow of cash within a business over a specific period. On the other hand, working capital is the difference between a company's current assets and liabilities. Cash flow is a measure of a company's liquidity and its ability to generate and use cash. Working capital focuses on short-term financial health and operational efficiency. --- ## Cash flow drivers in a business – FAQs What is the definition of cash flow drivers? Cash flow drivers are the key elements that influence the inflow and outflow of cash within a business. They help determine a company's financial health and can vary depending on factors like industry, business model, and management decisions. Cash flow drivers include revenue, expenses, working capital, and investments. What are the drivers of working capital? Working capital drivers are elements that impact a company's current assets and liabilities, which ultimately influence its liquidity and operational efficiency. Key drivers of working capital include inventory management, accounts receivable, and accounts payable. Effective management of these drivers can lead to better cash flow and financial stability. What is a profit driver? A profit driver is any factor or activity that contributes to the generation of profit in a business. These drivers play a crucial role in the overall financial success of a company. Examples of profit drivers include sales volume, pricing strategies, cost management, and operational efficiency. What drives free cash flow? Free cash flow is the cash generated by a business that's available for distribution to the company's investors after accounting for all operating expenses and capital expenditures. The primary drivers of free cash flow include revenue growth, operating margin improvement, working capital management, and capital expenditure optimization. --- ### Join our community of finance professionals! Sign up to our free [Finance Alliance Slack community](https://www.financealliance.io/community/) and start networking with other CFOs and finance leaders. Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### How FP&A machine learning is powering a new era of finance URL: https://www.financealliance.io/fpa-machine-learning/ Last updated: 2025-04-08T17:40:23.000Z Are you tired of spending hours on manual financial planning and analysis (FP&A) processes? What if we told you there was a solution that could not only save you time but provide more accurate forecasts? Enter FP&A [machine learning](https://www.aiacceleratorinstitute.com/your-guide-to-machine-learning/) (ML). By automating manual processes and utilizing advanced algorithms, it's never been easier to access in-depth insights and predictions. But the question still remains – is it time to say goodbye to manual FP&A processes for good? We'll let you decide that one for yourself. For now, though, let's explore how FP&A machine learning is powering a new era of finance. **Topics covered:** - [What is machine learning in finance?](https://www.financealliance.io/p/3cae2706-ba00-4267-889c-67e061992800/#what-is-machine-learning-in-finance) - [5 undeniable benefits of machine learning in FP&A](https://www.financealliance.io/p/3cae2706-ba00-4267-889c-67e061992800/#5-undeniable-benefits-of-machine-learning-in-fpa) - [Common use cases for FP&A machine learning](https://www.financealliance.io/p/3cae2706-ba00-4267-889c-67e061992800/#common-use-cases-for-fpa-machine-learning) - [Risks and limitations of machine learning in FP&A](https://www.financealliance.io/p/3cae2706-ba00-4267-889c-67e061992800/#risks-and-limitations-of-machine-learning-in-fpa) - [What to consider *before* embracing FP&A machine learning](https://www.financealliance.io/p/3cae2706-ba00-4267-889c-67e061992800/#what-to-consider-before-embracing-fpa-machine-learning) - [How to get started with machine learning in FP&A](https://www.financealliance.io/p/3cae2706-ba00-4267-889c-67e061992800/#how-to-get-started-with-machine-learning-in-fpa) - [Tips to leverage machine learning in FP&A](https://www.financealliance.io/p/3cae2706-ba00-4267-889c-67e061992800/#tips-to-leverage-machine-learning-in-fpa) ## **What is machine learning in finance?** Machine learning in finance refers to the application of algorithms that can analyze complex volumes of financial data and learn from them. The use of machine learning in finance has become integral to many phases of the financial ecosystem. These include everything from approving loans and carrying out credit scores to managing assets and assessing risk. Machine learning can be particularly useful for FP&A to identify trends, forecast future outcomes, and optimize resource allocation. You can also use it to analyze mountains of historical sales data, customer behavior, and market trends in a matter of minutes. ## **5 undeniable benefits of machine learning in FP&A** In today's fast-paced financial landscape, time is of the essence, and accuracy is critical. By leveraging FP&A machine learning, you can transform your day-to-day processes for the better. Here's how: ### 1\. Enhanced forecast accuracy and precision You can create driver-based self-learning models to leverage data and provide greater consistency and accuracy in forecasting. ### 2\. Increased productivity and efficiency Delegate your most time-consuming tasks to machine learning technology. In doing so, you can free up time to focus on more strategic initiatives such as business partnering. ### 3\. Better-informed decisions with valuable insights Machine learning unlocks powerful business insights from large datasets that were previously difficult to discover and optimize. FP&A teams can identify patterns, trends, and anomalies that may have gone unnoticed with traditional forecasting methods. These insights can inform strategic decision-making and give businesses a competitive edge. ### 4\. Decreased cycle times FP&A processes can be completed faster, reducing cycle times and enabling teams to respond more quickly to changing business conditions. Automated forecasting and update capabilities allow for faster iterations and reduce the need for manual iterative cycles. Oftentimes, this reduces budgeting and forecasting cycles from months to weeks and even days in some cases. ### 5\. Real-time scenario planning and sensitivity analysis FP&A machine learning gives you the power to run scenarios in real time and forecast across all of them simultaneously. Machine learning can also perform sensitivity analysis at an astonishing level of precision. This helps businesses better understand how changes in key variables will impact their financial performance. --- [Your Guide to Finance Transformation | Finance AllianceIn this guide, we’ll delve into the exciting world of finance transformation and explore how you can harness its power to take your business (and your career) to the next level.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Hub-page-finance-transformation.jpg)](https://www.financealliance.io/your-guide-to-finance-transformation/) --- ## **Common use cases for FP&A machine learning** [Machine learning](https://www.aiacceleratorinstitute.com/your-guide-to-machine-learning/) in FP&A harnesses the power of data-driven insights, automates repetitive tasks, and optimizes resource allocation. But how are finance teams leveraging this technology in their roles? Here are a few common use cases: - **Forecasting:** Financial forecasting using machine learning involves training algorithms to analyze historical data and identify patterns to make predictions about future financial trends. - **Automating data management:** Instead of spending time manually inputting data, monitoring spreadsheets, and updating databases, machine learning models can automate these tasks. You can delegate things like data entry and data cleaning. - **Fraud detection:** By analyzing transaction data and identifying patterns of suspicious behavior, machine learning algorithms can help organizations detect anomalies and prevent fraudulent activities. - **Predictive modeling:** With machine learning, FP&A teams can build predictive models that use historical and real-time data to forecast future outcomes, identify trends, and uncover opportunities for growth. This can help businesses make more informed decisions and stay ahead of the competition. - **Optimizing portfolio performance**: Machine learning can swiftly identify patterns and trends in the stock market, machine learning can help organizations make informed decisions about where to allocate their resources. This can lead to better investment returns and improved overall performance. - **Customer segmentation:** Analyzing customer data and spotting patterns with machine learning technology makes it easier to segment customers based on their behaviors, preferences, and needs. - **Pricing optimization**: Optimize your pricing strategies by analyzing market trends, competitor pricing, and customer behavior. ![Machine learning in FP&A - image of a typewriter printing a page that says 'machine learning'](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Machine-learning-in-finance.jpg) ## **Risks and limitations of machine learning in FP&A** While machine learning has many potential benefits in FP&A, it also carries some risks and limitations, including: ### 1\. Data quality Machine learning algorithms need large volumes of high-quality data to learn from. If the data is inaccurate or incomplete, it can lead to incorrect or biased predictions. So, you must ensure the data used in machine learning models is trustworthy and reliable. ### **2\. Over-reliance** You must be cautious about over-reliance on machine learning algorithms. Although they can automate many tasks, they cannot replace human judgment and experience. It's important to understand the limitations of machine learning and use it as a tool to support decision-making rather than a substitute for it. ### 3\. Model complexity Machine learning algorithms can be complex and difficult to interpret. As a result, it can be challenging to understand how they arrived at a particular prediction or decision. This can be a significant issue when attempting to explain results to stakeholders and regulators. ### 4\. Security and privacy As with any technology that involves sensitive financial data, there are some security and privacy risks associated with machine learning in FP&A. It's essential to ensure that data is secure and that access to it is appropriately controlled. ### 5\. Bias and discrimination Machine learning algorithms can unintentionally amplify biases that exist in the data used to train them. This can lead to discriminatory outcomes that impact certain groups of people unfairly. Therefore, it's crucial to monitor machine learning models and ensure they're not perpetuating existing biases. --- [How finance digital transformation can impact your companyIn today’s fast-paced business world, finance digital transformation is crucial for organizations to stay ahead of the game. From streamlining processes and increasing efficiency to providing real-time insights and improving data accuracy, financial transformation is the ultimate game changer.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/finance-digital-transformation-header-image.jpg)](https://www.financealliance.io/how-finance-digital-transformation-impact-company/) --- ## **What to consider** ***before*** **embracing FP&A machine learning** As organizations begin to explore the potential of machine learning in FP&A, it's crucial to consider a few important factors before diving in headfirst. Here are a few key considerations you can evaluate to help build out your organization’s machine-learning roadmap: ### 1\. Data cleanliness Data is the foundation upon which the future of finance will be built. Therefore, data within your organization must be clean, accurate, and reliable. This applies to all business units throughout the organization, not just finance. ### 2\. Data governance It's important to have data governance in place throughout your organization to maintain data integrity. Identify any data issues early on to avoid downstream waste. ### 3\. Familiarity with external, ambiguous, and unstructured data Take time to get to know your data. And, explore how external indicators can help deliver better insights to the business. This is where advanced analytics and machine-learning technologies can be particularly useful. ### 4\. Timeframe for reconstructing end-to-end business planning logic Building a fresh approach to unraveling and reforming business planning logic takes time. Establish a reasonable timeframe to achieve this and challenge the use of more convenient lift-and-shift strategies. ## **How to get started with machine learning in FP&A** There are several areas of FP&A where machine learning can be applied, including financial forecasting, financial modeling, and financial planning and budgeting. In this section, we'll explore each area in detail and provide practical advice on how to use machine learning to improve your FP&A processes. ### **ML and financial forecasting:** Machine learning can be a powerful tool to improve the accuracy and precision of financial forecasts. To get started with machine learning in [financial forecasting](https://www.financealliance.io/podcast/financial-forecast-model/), the first step is to identify the key drivers that impact your business and gather historical data for those drivers. Next, you can use machine learning algorithms to identify patterns and relationships in the data and use those insights to make more accurate forecasts. Note: It's important to continually monitor and adjust the algorithms based on actual results to improve their accuracy over time. ### **ML and financial modeling:** Financial modeling is a crucial component of FP&A, and machine learning can help streamline and improve the accuracy of this process. To get started with machine learning in [financial modeling](https://www.financealliance.io/build-a-saas-financial-model/), pin down the key variables and assumptions that go into your models. Then, you can use machine learning algorithms to test different scenarios and identify the most likely outcomes. This can help you make more informed decisions and mitigate risks. ### **ML and financial planning and budgeting** Machine learning can also be applied to the financial planning and budgeting process, helping to improve accuracy, efficiency, and flexibility. Similarly to how financial forecasting machine learning works, you've also got to start by identifying and fathering historical data for the key drivers of the business. Next, you can use machine learning algorithms to analyze the data and identify trends and patterns. This can help you develop more accurate forecasts and make more informed decisions about resource allocation. Additionally, machine learning [budgeting models](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/) can help you automate many of the manual tasks involved in the planning and budgeting process, freeing up time for more strategic activities. --- [What is finance transformation? | Finance AllianceIn this article, we’re diving into what finance transformation means, the key drivers of it, and why it’s something that needs to be on your radar in 2023 and beyond.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/what-is-finance-transformation.jpg)](https://www.financealliance.io/what-is-finance-transformation/) --- ## **Tips to leverage machine learning in FP&A** So, you're sold on the benefits of FP&A machine learning, but where do you start? Don't worry, we've got you covered with some tips to help you make the most of this powerful technology. **1\. Start with a clear goal:** Before diving into machine learning, it's essential to have a clear understanding of what you hope to achieve. Identify specific challenges or pain points in your forecasting process and set measurable goals for improvement. **2\. Invest in quality data:** Machine learning algorithms are only as good as the data they're trained on. Make sure your data is clean, accurate, and relevant to your forecasting needs. **3\. Choose the right algorithm:** There are countless machine learning algorithms out there, each with its strengths and weaknesses. Take the time to research and choose the one that's best suited to your specific needs. **4\. Don't forget the human touch:** While machine learning can do wonders for forecasting accuracy, it's important not to overlook the value of human expertise. Ensure that your team has a solid understanding of the data and can provide the necessary context to help algorithms make informed predictions. **5\. Iterate and improve:** Machine learning is not a one-and-done solution. Continuously evaluate the effectiveness of your algorithms, and use that feedback to improve and iterate over time. --- ## **FP&A machine learning FAQs** Will FP&A be automated? Well, some parts of FP&A might be automated, but it's unlikely that the whole field will be. Machine learning and other tech can help with tasks like forecasting and data analysis, but we'll still need humans to interpret those results and make strategic decisions. Do financial analysts use machine learning? Absolutely! Many financial analysts use machine learning to analyze large data sets, spot patterns and trends, and predict future performance. It can also automate certain tasks, giving analysts more time to focus on strategic activities. Should finance professionals learn machine learning? While not every finance professional needs to be an ML expert, it can definitely help to know the basics. Understanding how machine learning works can help you better use the tech in your job and communicate more effectively with data scientists and other tech-savvy folks. What is ML for financial modelling? Machine learning for financial modeling is all about using algorithms to analyze financial data, identify patterns, and make predictions about future performance. These models can help with things like investment strategies and risk management. What is ML in financial planning? Machine learning in financial planning involves using algorithms to analyze data and make predictions about future financial performance. This can include forecasting revenue and expenses, identifying potential risks, and developing financial plans to achieve specific goals. What is the use of ML in forecasting? Machine learning can be used in forecasting to analyze large data sets, identify patterns and trends, and make predictions about future performance. This can include forecasting revenue and expenses, identifying potential risks, and developing financial plans to achieve specific goals. What are the main 3 types of ML models? There are three main types of machine learning models: supervised learning, unsupervised learning, and reinforcement learning. In supervised learning, models are trained on labeled data and then used to make predictions about new data. Unsupervised learning models are trained on unlabeled data and used to find patterns and relationships in the data. Reinforcement learning models are trained to make decisions in a dynamic environment, receiving feedback, and adjusting their approach over time. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/01/FA_State_of_Finance_Transformation_Report_2022_CTA.jpg) ](https://www.financealliance.io/state-of-finance-transformation-report-2022/) ### How to use Microsoft 365 Copilot in Excel URL: https://www.financealliance.io/how-to-use-microsoft-365-copilot-in-excel/ Last updated: 2025-04-04T14:42:56.000Z In a ground-breaking move, Microsoft has recently launched its highly anticipated [Microsoft 365 Copilot](https://blogs.microsoft.com/blog/2023/03/16/introducing-microsoft-365-copilot-your-copilot-for-work/), set to transform the daily work processes of finance professionals overnight. This innovative tool, combining large language models (LLMs) with data in both the Microsoft Graph and Microsoft 365 apps, promises to unlock new levels of productivity and efficiency within the Microsoft 365 suite. ### What is Microsoft Copilot? Copilot is designed to alleviate the burden of mundane tasks, enabling users to focus on more fulfilling and creative aspects of their work. This new tool can be integrated seamlessly into Microsoft applications such as Word, Excel, PowerPoint, Outlook, and Teams. It’s to become an indispensable resource for CFOs, FP&A teams, Finance Directors, and pretty much every finance role under the sun. > “*Today marks the next major step in the evolution of how we interact with computing, which will fundamentally change the way we work and unlock a new wave of productivity growth...* > “...*With our new copilot for work, we’re giving people more agency and making technology more accessible through the most universal interface — natural language*.” - Satya Nadella, Chairman and CEO, of Microsoft. Microsoft's introduction of the all-new **Business Chat** feature further enhances the Copilot experience. By connecting the LLM, Microsoft 365 apps, and your data, Business Chat enables users to issue natural language prompts for tasks like generating status updates based on meetings, emails, and chats. --- [How to use GPT-4o in finance (and data analysis)You can now upload Excel, CSV, and other spreadsheet files directly to GPT-4o. No more copying and pasting data into ChatGPT manually, which makes the entire process of analyzing complex data sheets a lot easier and less time-consuming.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/05/GPT-4o-finance-2.jpg)](https://www.financealliance.io/how-to-use-gpt-4o-in-finance-and-data-analysis/) --- The positive impact of Copilot is evident from recent [GitHub data](https://github.blog/2022-09-07-research-quantifying-github-copilots-impact-on-developer-productivity-and-happiness/), with developers reporting significant improvements in productivity by up to 88%. Not only that, but 74% of those who used Copilot said they were able to focus on more engaging work while 77% reported spending less time on research. 💡 Microsoft has launched [Copilot Studio](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) \- find out more about it here. [How to build custom copilots with Microsoft Copilot StudioMicrosoft’s latest technological marvel, Copilot Studio, announced at Ignite 2023, marks a revolutionary step for finance professionals.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/11/Copilot-image.webp)](https://www.financealliance.io/how-to-build-custom-ai-copilots-with-microsoft-copilot-studio/) ## How to use Copilot in Excel Copilot in Excel offers numerous benefits, such as the ability to ask questions about your data set in natural language rather than just formulas. The tool can reveal correlations, suggest what-if scenarios, and create powerful visualizations based on your queries. With commands like, "*Give a breakdown of the sales by type and channel, then insert a table*," or "*Project the impact of \[a variable change\] and generate a chart to help visualize*," you can streamline your daily processes and make more informed decisions. A Microsoft 365 Copilot's integration with Excel provides a wealth of benefits for finance professionals, including those focused on financial modeling and similar processes. Below, we'll explore how to harness the power of Copilot in Excel and dive into its applications for specific finance-related tasks: ### Natural language queries Copilot's ability to process natural language queries makes it easier than ever to analyze and explore data in Excel. Users can simply ask questions about their data sets without having to rely solely on complex formulas. Copilot will reveal correlations, propose what-if scenarios, and even suggest new formulas based on the questions asked. ![Source: Microsoft 365 Copilot](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/copilot1-1.png) ### Financial modeling and scenario analysis When working on financial modeling, Copilot can be an invaluable asset. By providing prompts such as, "*Model how a change to the growth rate for \[variable\] would impact my gross margin*," you can explore the implications of various scenarios on your financial models *without* modifying the underlying data. ### Visualizations and recommendations In addition to simplifying data analysis, Copilot offers the ability to create powerful visualizations that aid in decision-making. With commands like "*Project the impact of \[a variable change\] and generate a chart to help visualize*," you can effortlessly generate visuals to present your findings. Furthermore, Copilot can offer recommendations to drive different outcomes based on the data being analyzed. ### Streamlining financial processes Whether it's budgeting, forecasting, data analysis, or financial analysis, Copilot's integration with Excel enables you to streamline your daily tasks. By asking Copilot for assistance with specific processes or requesting recommendations, users can save time and focus on higher-value activities. --- [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/10/CFO_Summit_London_NOV24_Email_Banner_-7.png)](https://cfoevents.financealliance.io/location/cfolondon) --- Microsoft 365 Copilot's integration with Excel opens up a world of possibilities for finance professionals, making financial modeling, data analysis, and other complex tasks more accessible and efficient than ever before. With natural language queries, visualizations, and a wealth of insights at their fingertips, users can make better-informed decisions and drive success for their organizations. --- ### Microsoft Excel Copilot - FAQs How do I activate Copilot in Microsoft 365? There's no need for a separate activation process to enable Copilot in Microsoft 365\. As long as you have a valid Microsoft 365 subscription, you'll automatically have access to Copilot features in the supported applications. How do I enable Copilot in Excel? With a valid Microsoft 365 subscription, you can start using Copilot features within Excel right away. Simply type a natural language query in the formula bar or use the "Ask Copilot" feature to get insights and recommendations based on your data. What types of financial tasks can Copilot in Excel help with? Copilot in Excel is a versatile tool for finance professionals, assisting with tasks like financial modeling, budgeting, forecasting, and financial analysis. By streamlining these processes, Copilot allows you to focus on higher-value activities and make data-driven decisions with ease. How do I use natural language queries with Copilot in Excel? To use natural language queries with Copilot in Excel, simply follow these steps: 1. Launch Microsoft Excel and open the desired workbook. 2. Locate the "Ask Copilot" or "Ideas" button, usually found on the "Home" tab or in the top right corner of your Excel window. 3. Click the button to open the Copilot panel. 4. Type your natural language query into the search bar, such as "Show me the average sales for the last quarter" or "Create a pie chart for department expenses." 5. Press Enter or click the magnifying glass icon to submit your query. 6. Copilot will analyze your data and provide relevant results, insights, or suggestions based on your query. Simply click on the suggested action or visualization to apply it to your data. Is Copilot in Excel compatible with existing Excel files and templates? Yes, Copilot in Excel is fully compatible with existing Excel files and templates. When you use Copilot, it integrates seamlessly into your Excel environment, enabling you to utilize its powerful features and natural language query capabilities with any existing workbooks or templates. Simply open your desired file or template, and access Copilot through the "Ask Copilot" or "Ideas" button. Copilot will analyze your data and provide relevant insights, suggestions, and visualizations based on your queries. --- ### Further reading: Find out more about Microsoft Fabric and how you can use it with Data Factory, Synapse Real-Time Analytics, and more here: [How to use Microsoft Fabric for data analyticsWith Microsoft Fabric, you can bridge the gap between data and intelligence and integrate all your data seamlessly. These tools have opened up new possibilities, setting the stage for a new era in finance AI.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Microsoft-fabric-1.jpg)](https://www.financealliance.io/microsoft-fabric-for-data-analytics/) Learn how to use ChatGPT with Excel here: [How to use ChatGPT for ExcelIn this blog post, you’ll learn about some of the best ways to use ChatGPT and Excel to help enhance your productivity and optimize your daily processes.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/04/ChatGPT-for-Excel.jpg)](https://www.financealliance.io/chatgpt-for-excel/) Read all about how to use Copilot with Power BI here: [How to use Copilot in Power BIIn this article, we explore how you can leverage the power of Copilot in Power BI to help streamline your everyday processes within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/copilot-in-power-bi-2.jpg)](https://www.financealliance.io/copilot-in-power-bi/) And finally, discover how to use Google Bard with Excel and Google Sheets: [How to use Google Bard with Google Sheets and ExcelIn this article, we discuss the rise of Google Bard and how it can act as your personal assistant within your finance role.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/05/Bard.jpeg)](https://www.financealliance.io/google-bard-with-google-sheets-excel/) **Continue the discussion about how to use Copilot and other AI software (like ChatGPT and GPT4) inside our** [**Finance Alliance Slack Community**](https://www.financealliance.io/community/)**.** [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### FP&A Summit San Diego | Speakers share their experiences URL: https://www.financealliance.io/fp-a-summit-san-diego-speaker-testimonials/ Last updated: 2023-03-21T12:20:14.000Z We recently held our first in-person event, the **FP&A Summit** in San Diego. 🔊 The event brought together finance professionals from around the world to learn, network, and exchange solutions on issues most top-of-mind. The agenda was packed with thought-provoking talks on topics like empowering your inner leader, sustainable finance, dealing with cash flow challenges, how to exceed expectations during your first 90 days as a CFO, and more. Attendees had the opportunity to hear from notable speakers such as [Chris Ortega](https://www.linkedin.com/in/freshcfo/), CEO at Fresh FP&A, [Steve Robertson](https://www.linkedin.com/in/stevengrobertson/), CFO at HDMI, [Erik Nakamura](https://www.linkedin.com/in/eriknakamura32675/), CFO at Orange Comet, and [Gina Spain](https://www.linkedin.com/in/ginaspain/), Director of Finance Reporting at Virgin Galactic. After the event, we caught up with a few of the speakers to hear their thoughts about the event. Here’s what they had to say: ### An intimate setting for collaborating and communicating Chris Ortega, CEO at Fresh FP&A spoke highly of the event, saying: > "*The thing I loved the most about the *FP&A Summit* was the interaction from everybody. You had a very *intimate setting*. But you had so many people *collaborating* and *communicating*, not just regarding the presenter topics, but amongst themselves too.*" - Chris Ortega, CEO at Fresh FP&A He also noted the great opportunity to share viewpoints in an intimate setting with other finance leaders: ![Chris Ortega testimonial from the FP&A Summit](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/9.png) ### Great insights and an engaged audience Steve Robertson, CFO at HDMI, appreciated the engagement of the audience, comparing it to a comedy show where the quality of the experience depends on the engagement of the audience. He noted that the event was an excellent opportunity to share viewpoints and collaborate with other finance CFO and FP&A leaders: ![Steve Robertson testimonial - FP&A Summit](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/10.png) ### An interactive experience Erik Nakamura, CFO at Orange Comet, added that the people were passionate, coming from diverse backgrounds and industries, which made for a fascinating mix of perspectives. > *“It was very *interactive*. The people were very *passionate*, which is good. We had a great group and mix of different types of people from different backgrounds and industries, which was really *interesting* to see.”* – Erik Nakamura, CFO at Orange Comet ### Collaboration for addressing issues > *“The *FP&A Summit* was *fantastic*, especially getting to *network* with so many different individuals and *leaders in finance*.”* – Gina Spain, Director of Finance Reporting at Virgin Galactic Gina Spain, Director of Finance Reporting at Virgin Galactic, appreciated the event's collaboration with other finance leaders, gaining insights on how others are addressing issues and problems. The event had great information exchange, allowing attendees to take back useful information to their organizations. ![Gina Spain testimonial - FP&A Summit](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/3.png) --- ## Our upcoming events 🔊 Overall, the FP&A Summit was a great success with its fantastic line-up of world-class speakers, engaging panels, and hands-on workshops. But the fun doesn't stop there! If you're itching to get in on the action and learn about the latest and greatest in finance, check out our [upcoming events](https://events.financealliance.io)!👇 [Top finance events to attend | Finance Alliance2023 is set to be an exciting year with a range of finance events taking place around the world that offer opportunities to learn, network, and grow. Have your calendar ready as we drop the ultimate round-up of top finance events to attend in 2023.👇🏽![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Finance-events.jpg)](https://www.financealliance.io/top-finance-events/) ### From the back office to the boardroom: How to get a seat at the table URL: https://www.financealliance.io/how-to-get-a-seat-at-the-table/ Last updated: 2025-04-07T16:26:03.000Z Are you a finance professional who's tired of being stuck in the back office, crunching numbers and preparing reports day in and day out? Do you yearn for a seat at the boardroom table, where the real decisions are made? If so, then you're in luck because we've got just the expert to guide you on your journey to connect finance and leadership and become a successful finance business partner. Meet [Andrew Jepson](https://www.linkedin.com/in/financebusinesspartnering/), Partner (APAC) at The Finance Business Partner, and a true master of his craft. With years of experience under his belt, Andrew knows exactly what it takes to move from the back office to the boardroom and thrive as a finance business partner. In this Q&A-style blog post, Andrew shares his expert insights and practical tips on how to make the transition and succeed in your new role. **Topics covered:** - [What’s the true meaning of finance business partnering?](https://www.financealliance.io/p/cb7eb540-9d1b-45f3-99e5-089a0aa6eef0/#what%E2%80%99s-the-true-meaning-of-finance-business-partnering) - [How can finance professionals build relationships with business partners?](https://www.financealliance.io/p/cb7eb540-9d1b-45f3-99e5-089a0aa6eef0/#how-can-finance-professionals-build-relationships-with-business-partners) - [How to overcome 3 common barriers](https://www.financealliance.io/p/cb7eb540-9d1b-45f3-99e5-089a0aa6eef0/#how-to-overcome-3-common-barriers) - [What organizational changes need to happen to help embrace this type of business partnership?](https://www.financealliance.io/p/cb7eb540-9d1b-45f3-99e5-089a0aa6eef0/#what-organizational-changes-need-to-happen-to-help-embrace-this-type-of-business-partnership) - [What essential skills does a finance business partner need?](https://www.financealliance.io/p/cb7eb540-9d1b-45f3-99e5-089a0aa6eef0/#what-essential-skills-does-a-finance-business-partner-need) - [How to build key finance business partnering skills](https://www.financealliance.io/p/cb7eb540-9d1b-45f3-99e5-089a0aa6eef0/#how-to-build-key-finance-business-partnering-skills) - [How can someone step into a finance business partnering role?](https://www.financealliance.io/p/cb7eb540-9d1b-45f3-99e5-089a0aa6eef0/#how-can-someone-step-into-a-finance-business-partnering-role) - [What advice would you give to someone who wants to become an FBP?](https://www.financealliance.io/p/cb7eb540-9d1b-45f3-99e5-089a0aa6eef0/#what-advice-would-you-give-to-someone-who-wants-to-become-an-fbp) Ready to learn from the best? Let's get started!👇 ## What’s the true meaning of finance business partnering? It’s quite a simple yet broad concept and there’s a lot of stuff out there that overcomplicates it. [Finance business partnering](https://www.financealliance.io/tag/business-partnering/) is finance professionals working effectively with non-finance colleagues. What does that mean? It means the non-finance individuals are the judges of whether you can help them and solve business problems for *them*. ## How can finance professionals build relationships with business partners? Ask your business partners these three questions: ![Andrew Jepson - 3 questions to ask business partners](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Screenshot-2023-03-09-at-07.30.27.png) Unfortunately, doing that won’t get all the answers you need. So, you need to do some prep work to ensure they don’t see you as a threat and feel comfortable around you. So, take them out for lunch/coffee/a beer and just tell them you want to get to know them better as a person and talk to them about non-work things. Doing so will help to make them like you more, they’ll feel more comfortable, and they’ll share things with you they previously didn’t. *Get them talking about them, not you talking about you.* ## How to overcome 3 common barriers In the workshops we run, we ask this exact question and the top three responses without question are: ![Get a seat at the C-Suite table](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/seat-at-the-table.png) ### No time Time never changes, so that’s solved by prioritizing what’s important for the organization (not for finance) and accepting you will never get your to-do list done – and that’s ok. ### No seat at the table This is due to non-finance people having a lack of trust in you. If they don’t trust you, they’ll actively work around you. And if they don’t like you, they’ll avoid you and only call you in at the end. To fix this, finance individuals should focus on having people like them more, building strong relationships and connections, and not positioning themselves as an authority or threat to other people. ### Systems and processes Systems and processes are situational things that are different for every team and organization and is moving around all the time. But if your systems, processes, and staff are not capable of doing the things they need to, it’ll drag you down into that world where you are doing no business partnering and you’re just doing rework. --- [How to transform your team into finance business partnersFinance teams are more than just number crunchers. To become a finance business partner, you must create value by providing insights that help business leaders make data-driven decisions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Schöler![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/finance-business-partners-header-image.jpg)](https://www.financealliance.io/number-crunchers-finance-business-partners/) --- ## What organizational changes need to happen to help embrace this type of business partnership? Separate roles for Finance individuals that are not focused on month ends, budgets, and forecasts. Those three tasks alone, although important in any organization, position a finance business partner to be someone who focuses on month ends, budgets, and forecasts because they simply don’t have any time to do anything else. And that isn’t finance business partnering. A finance business partner should have a roving remit of a role to drop into wherever they deem necessary to solve business problems and help people. If they are stuck doing month ends for five days a month, then a forecast for three, then spending three to four months of the year on the budget, they’re not able to have the capacity to work on those problems as and when they arise. And hence others will find ways to work around you as you are never there for them when they want or need you. ## What essential skills does a finance business partner need? Communication, understanding of the business, and being able to build strong relationships. ### 1\. Communication Communication skills are number one by a long way. They solve all the issues required to be a great FBP, such as storytelling, presenting, problem-solving, critical thinking, influencing, persuasion, negotiating, and building relationships with people. Great communicators operate on a completely different level to those that are not great communicators. ### 2\. Strong relationships Next is great relationships and connections with people, whereby people answer their questions, give them the information they ask for, and sometimes even give them the information they didn’t ask for. ### 3\. Understanding the business And finally, they understand the business deeply. And not theoretically from textbooks. They have been in the business and deeply understand what John in Segment B goes through on a day-to-day basis and they can translate that into the numbers they see. --- [How to become a successful finance partnerWant to know how to become a successful finance partner? The role of the finance function has changed massively over recent years. Rather than generating reports all day, finance pros must step into a partnership role and work closely with other functions of the business.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/money-g094a1229b_1920-2.jpg)](https://www.financealliance.io/podcast/3-pillars-successful-finance-partner/) --- ## How to build key finance business partnering skills Spend as much time away from your desk as you do behind it. You simply won’t understand the business well enough by looking at your ERP system, spreadsheets, or running power BI dashboards. FBP is a face-to-face exercise that can NOT be done from your desk. If you are away from your desk working with people in other functions, you will greatly improve your communication skills, your knowledge of the business, and your relationships with the people in it. Funnily enough, those three things are the core skills and traits of a successful finance business partner. ## How can someone step into a finance business partnering role? I would suggest not seeing it as a role per se, but more as a thing you do within a role. Just because you have the title doesn’t mean you are one. And just because you don’t have the title doesn’t mean you are NOT one. Anyone can do FBP. The tax manager, the AR clerk, the payroll supervisor, and the FP&A Manager. Remember, it's finance people working effectively with non-finance people. Start working on some things that are important to your non-finance colleagues and you will be doing FBP. And, following on from that, the formal request to have you as their official “finance business partner” will look after itself. --- [How Finance professionals can measure their business impactMany Finance professionals strive to become better business partners supporting the business through insights and decision-support. But how do you measure whether you are succeeding as a finance business partner? This article presents three ways to measure your impact as a finance business partner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceChristian Frantz Hansen![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/hourglass-g627873e27_1920-2.jpg)](https://www.financealliance.io/how-finance-professionals-can-measure-their-business-impact/) --- ## What advice would you give to someone who wants to become an FBP? Get a job *outside* of finance. Even if it is a secondment to a project role, do something where you must call on skills you have yet to develop. Focus on your non-technical skills more. Remember everyone has the technical skills, we all have the same letters after our names and know the same stuff. It’s your non-technical skills and being able to apply them that separates you from everyone else. Nobody gives you an FBP role because you can recite IFRS16, do an amazing spreadsheet model that probably has an error in it, or can develop some great Power BI dashboards. It is also hard to know who to listen to in this space. There are a lot of opinions out there on it and the best FBPs in the world are most likely not making the noise on it. They are just doing it and getting on with it. Most great FBPs are great because their business partners say they are, not because they say they are themselves, so it’s hard to find the good ones to tap into. If in doubt, ask someone you trust or look up to in this space who they would recommend talking to. --- ### Download the Finance Business Partnering Playbook If you want to learn even more about finance business partnering and get expert advice from Andrew Jepson and other finance experts, be sure to download our [Finance Business Partnering playbook](https://www.financealliance.io/finance-business-partnering-playbook/). It's packed with valuable insights, practical tips, and actionable strategies that will take your finance business partnering skills to the next level. So, what are you waiting for? **Download the playbook today and become the ultimate finance business partner.**👇 [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1000/2023/02/FA_Finance_Business_Partnering_Playbook_CTA.jpg) ](https://www.financealliance.io/finance-business-partnering-playbook/) ### Become a data-driven decision maker (DDDM) | Part 1 URL: https://www.financealliance.io/become-a-data-driven-decision-maker-dddm-part-1/ Last updated: 2024-06-20T11:11:39.000Z My last blog about the [FP&A Chasm](https://www.financealliance.io/the-financial-planning-analysis-chasm/) generated a lot of buzz, so I thought I'd write a short playbook on another hot topic - "Data-Driven Decision Making" or DDDM. **Topics covered in this article:** - [The Basics: Recognizing that you have a problem ](https://www.financealliance.io/p/22d18bd2-a14c-4532-a516-07807a9d5391/#the-basics-recognizing-that-you-have-a-problem-is-the-first-step-to-solving-it) - [Predictive analytics](https://www.financealliance.io/p/22d18bd2-a14c-4532-a516-07807a9d5391/#predictive-analytics) - ‍[1-10-100 Rule](https://www.financealliance.io/p/22d18bd2-a14c-4532-a516-07807a9d5391/#%E2%80%8D1-10-100-rule) - [How to avoid analysis paralysis](https://www.financealliance.io/p/22d18bd2-a14c-4532-a516-07807a9d5391/#but-how-do-we-avoid-analysis-paralysis) ## The Basics: Recognizing that you have a problem is the first step to solving it ‍ ![](https://uploads-ssl.webflow.com/6363ef9d34ca74e4c5cc8a92/63ee34a9baf934c51ffab7a3_omvQIZC__7371L01zbfMlT5DLGn3UPU26ri2INWBUOIaGfR9HaVo5wLNVnz9j_iIkTILrRQyeOxyFeBqQhqOjszPJn51TFd4eXQTE9pSIUQjWfZ4DsLI98UFZH1o1isoL4x_oIMgmv1GbWsBXxdZZcY.png) [Image Source ](https://www.smartsheet.com/data-driven-decision-making-management) The overwhelming majority of executives plot their organizations as either data-informed or data-driven on the spectrum above. However, most of them have data collection practices more characteristic of a 'data indifferent' organization. We all know the saying, "*garbage in, garbage out*" when it comes to analysis, so it stands to reason that you can’t be [data-driven](https://www.financealliance.io/from-data-driven-to-ai-powered/) or data-informed if you don’t collect the data. At least not in the way you think. It's common for the CRO of an organization to puff up their chest and tell me about all the salesforce dashboards they use to drive decisions. They quickly deflate when I ask them about the integrity of their salesforce data. If this is you, that’s fine! Just understand that you are not truly analyzing your pipeline, customer traction, GTM effectiveness, or your sales process. The decisions that you are making are based on what your sales reps decided to show you. This doesn’t mean that you can’t glean insights, it just means that you have to be realistic about what data you’re actually analyzing. Are you analyzing the effectiveness of your sales process, or are you analyzing the behavior of reps? That matters. When we analyze this type of sales-rep-biased pipeline data, even the worst data, we’ve come up with an insight that either made or saved the company $500k or more every single time.‍ ## Predictive analytics Every organization we work with wants to move into predictive analytics (why else would they buy our platform?). If you haven’t seen this chart by Gartner covering the analytic value escalator, then you should look at it very carefully, close your eyes, and burn that image into your brain. ![Analytic value escalator image by Gartner](https://uploads-ssl.webflow.com/6363ef9d34ca74e4c5cc8a92/63f2c9d9eb2bb2cb47047196_Screenshot%202023-02-20%20at%209.14.39%20AM.png) ‍ The famous quote by philosopher George Santayana, "*Those who do not learn history are doomed to repeat it*.” This is an escalator for a reason. You can never get to predictive or prescriptive analytics without tackling descriptive and diagnostic analytics first. It may seem counterintuitive, but nail the descriptive and diagnostic phase of your business and you’ll get predictive answers faster. The human brain is the best analytical engine we have. Feed this analytical engine accurate historical analytics and you will instantly connect dots that would take analysts years to do with a mediocre data set. Focus your Organization's efforts on understanding your past, and the people at your company will be able to predict the future 10x faster than if you spent the same resources on predicting the future. Why? Because of the 1-10-100 rule. ## ‍1-10-100 Rule ![the 1-10-100 rule](https://uploads-ssl.webflow.com/6363ef9d34ca74e4c5cc8a92/63ee34a9edd0a50cf38a333f_4_VUaZz_LNPAWGzYXKJ5DzkLxpRCbhcP_z_W-mgYiIRXSpTj806-y3Q_W0CtZDJiTKOKm8mO6eg4K2-v6OGOBRR4D5JH_jukDpBQfXUzyc-EtyE5j5eNOz59ZceM_f4ms9UPuH9gIwO8AoeW5C8BdLo.png) [Image Source](https://smarteinc.com/the-1-10-100-rule-the-business-benefits-of-customer-data-enrichment/) ‍There’s a concept in manufacturing called the 1-10-100 rule that describes the exponentially increasing cost of fixing an issue as it moves through the stages of the process. ##### **The 1-10-100 rule applies directly to DDDM! A faulty data point costs your organization exponentially more to fix the more decisions you make based on it.** For instance, if you hire additional engineers based on an inaccurate revenue forecast, the cost of unwinding that decision is exponentially more expensive than generating a better revenue forecast. Look at the debacle that is [JP Morgan’s acquisition of Frank](https://www.forbes.com/sites/alexandralevine/2023/01/11/jp-morgan-fake-customers-frank-charlie-javice/?sh=3999386714d4), where a little more analysis would have saved them $175,000,000\. --- [The Financial Planning & Analysis Chasm | Finance AllianceOliver Vander Horn breaks down the inner workings of the Financial Planning & Analysis Chasm in this insightful blog post.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceOliver Vander Horn![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/wormhole-ga69ffc70f_1920-2.jpg)](https://www.financealliance.io/the-financial-planning-analysis-chasm/) --- ## But how do we avoid Analysis Paralysis? Use Amazon's Type 1 and Type 2 decision framework to understand when you should make a decision quickly versus taking the time to ensure you understand all the facts and circumstances.‍ ![Decision to make framework](https://uploads-ssl.webflow.com/6363ef9d34ca74e4c5cc8a92/63ee34a9ba7afb5318f4bdde_9SRucd3h13fpEFcUEeQXIqmpUvT3t-n4_G_oEF6p5lp3l6qbNuu9BVR6IMWACUPaU-ilrH1NS8YbnevyeZx79hJn8FR9tPNRcjMQcWpKq1CwlEzMzg_BmJVMUxKicWMk4vNyOCiOxbLecIGylq2S5ak.png) [Image Source](https://productiveclub.com/type-1-type-2-decisions-jeff-bezos/) Amazon's decision-making framework distinguishes between two types of decisions: Type 1 and Type 2. Type 1 decisions are irreversible and can have significant long-term consequences. They are high-stakes decisions that require careful consideration and should not be made lightly. Examples of Type 1 decisions include investing in a new business line or product, entering a new market, or acquiring another company. These decisions often require a great deal of time and resources to fully evaluate all the relevant facts and circumstances. It is important to take the time to gather all the necessary information and input from relevant stakeholders before making a Type 1 decision. Type 2 decisions, on the other hand, are reversible and have a lower level of impact. These decisions are more operational in nature and are typically made on a day-to-day basis. Examples of Type 2 decisions include changing a website layout or modifying a marketing campaign. Type 2 decisions can often be made quickly, with less input and analysis, because the potential consequences of making a wrong decision are relatively minor and can be corrected easily if needed. By using this framework, you can determine when to make a quick decision versus when to take the time to gather all the facts and make a more informed decision. When faced with a decision, you should consider the potential impact of the decision, the reversibility of the decision, and the amount of time and resources required to fully evaluate the decision. This can help ensure that you make the right decision for your organization, based on the circumstances and stakes involved. --- [How to use data visualization storytelling to transform FP&AWant to learn how to tell compelling stories with data? Discover techniques to improve your data visualization storytelling skills right here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/data-visualization-storytelling-2.jpg)](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) --- ### Key Takeaways 1. Recognize the problem to solve it: Executives who have poor data collection practices cannot make data-driven decisions. 2. Understand what you can analyze: Even the worst data is often a gold mine when you think creatively. 3. Descriptive and Diagnostic Analytics are essential: You can't predict the future until you understand your past. 4. The 1-10-100 rule applies to [data-driven decision-making](https://www.financealliance.io/make-your-information-more-timely/): The cost of fixing an issue increases exponentially the more decisions you make based on a faulty data point. 5. Use Amazon's Type 1 and Type 2 decision framework to understand when to make quick decisions and when to take the time to gather all the facts. ### How to get started with finance business partnering URL: https://www.financealliance.io/how-to-get-started-with-finance-business-partnering/ Last updated: 2025-04-07T16:26:20.000Z If you want to make a real-time impact and solidify your place within a business, you’ve got to be more than just a ‘number cruncher.’ Moving into a business partnering role is a topic that stirs a lot of buzz in the finance community. But how can you get started with business partnering in finance? Being a finance business partner means working closely with other departments to help them make financially savvy decisions that'll benefit the whole company. But let's be honest, starting out in finance business partnering can be daunting, which is why we reached out to [Christian Wattig](https://www.linkedin.com/in/christian-wattig/), Managing Director at FP&A Prep, to simplify the process. In this post, Christian outlines why finance business partners are so valuable to organizations and what you can do to get started on the right foot and add as much value as possible from day one. So, if you're eager to take that first step toward your future as a finance business partner, keep reading! **Topics covered in this blog post:** - [Why finance business partners are so valuable to organizations](https://www.financealliance.io/p/4f339590-07a1-43f9-85bd-9a17ae20ef14/#why-finance-business-partners-are-so-valuable-to-organizations) - [Two reasons why finance business partners have a vital role to play](https://www.financealliance.io/p/4f339590-07a1-43f9-85bd-9a17ae20ef14/#the-vital-role-of-finance-business-partners) - [Getting started with finance business partnering](https://www.financealliance.io/p/4f339590-07a1-43f9-85bd-9a17ae20ef14/#getting-started-with-finance-business-partnering) - [How to get a seat at the table](https://www.financealliance.io/p/4f339590-07a1-43f9-85bd-9a17ae20ef14/#how-to-get-a-seat-at-the-table) ## Why finance business partners are so valuable to organizations [Finance business partners](https://www.financealliance.io/podcast/3-pillars-successful-finance-partner/) take an active role in helping the company achieve its goals. We do that by being a strategic partner to the business to drive sustainable growth and profitability while managing risk. Great finance business partners don’t just raise alarm bells when leaders want to take unnecessary risks. We also recommend which risks are worth taking, backed by data and thorough financial analysis. Specifically, finance business partners add value in four ways: ![How to get started with finance business partnering](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/business-partnering-in-finance-2.png) ## The vital role of finance business partners Finance business partners have a vital role to play because of two important reasons: ### 1\. Our goals are different. We don’t sit in silos like our cross-functional business partners. As a result, our incentives aren’t as narrowly defined. A sales leader wants to increase top-line revenue, which may come at the cost of profitability. And an R&D leader wants to keep launching new features, even if fixing the existing features results in more customer loyalty. Finance business partners can help achieve the right balance because they have broader goals. ### 2\. We have a birds-eye view of the financials. The data we access is broader and often all-encompassing, while our cross-functional business partners typically only consider what is necessary for their role. As a result, we can connect the dots between different areas of the business and use the information to spot changes in trends before others do. --- [6 steps for your first project as a finance business partnerIn this blog post, Srushti Mahamuni, Operation Business Analyst at Bank of America Merrill Lynch, guides you through the six steps to get started on your first project as a finance business partner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSrushti Mahamuni![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/finance-business-partnering-project.jpg)](https://www.financealliance.io/6-steps-to-tackle-your-first-project-finance-business-partner/) --- ## Getting started with finance business partnering If you’re eager to take the first step towards your future as a finance business partner, here are some tips to help you set off on the right foot by adding as much value as possible from the beginning. ### Demonstrate your value You need to start implementing something where other departments immediately see the value. It needs to help them achieve their goals. So, one thing that worked for me was giving them more flexibility around budgets. Traditionally, companies set a budget at the beginning of the year, and then people just must manage with that. Getting a budget increase after the fact can be difficult for many companies. But instead, I would tell people, look, we are happy to give you more flexibility. We just need two things from you: ![How to get started with finance business partnering](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/business-partnering-in-finance-1.png) Because they’re telling us things ahead of time, we can create a financial forecast and carry out the necessary tasks to meet their needs. And because they share the expected results of a change in the budget, we can do a financial analysis around it. We can run a return on investment (ROI) model or a discounted cash flow model and get a better idea of what the actual impact is on expected business results. And once that forecast and financial analysis process start to result in concrete recommendations, our business partners trust our abilities more. And that, in turn, can lead to more collaboration and opportunities for finance to add even *more* value. --- [How to transform your team into finance business partnersFinance teams are more than just number crunchers. To become a finance business partner, you must create value by providing insights that help business leaders make data-driven decisions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Schöler![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/finance-business-partners-header-image.jpg)](https://www.financealliance.io/number-crunchers-finance-business-partners/) --- ## How to get a seat at the table As finance business partners, we aim to become strategic partners driving sustainable growth and profitability while managing risk. But to get there, we need our cross-functional business partners to be willing to give us a seat at the table where decisions are made. And that requires trust. Sometimes, there isn’t enough trust because departments are concerned that sharing information about how they are planning to spend their funds may result in finance determining the return on investment isn’t good enough. They are concerned that their projects may then get stopped and budgets cut. So, finance business partners need to demonstrate that they can do more than that. They need to show that they can help their business partners achieve their goals, instead of only focusing on profitability. --- ### **Partner for impact and use data storytelling to drive decisions** If you want to learn even more about finance business partnering and get expert advice from Christian Wattig, take our Business Partnering & Storytelling: Certified course. With Christian Wattig (founder of FP&A Prep) as your coach, you’ll learn how to build and nurture relationships, provide insightful guidance to influence decisions, and turn complex data into compelling stories that inspire action. [Find out more](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) ### Creating harmony across the enterprise as a finance leader | Ernie Humphrey URL: https://www.financealliance.io/podcast/creating-harmony-across-the-enterprise-as-a-finance-leader/ Last updated: 2023-03-08T11:13:59.000Z Building a strong personal brand can help you stand out from the crowd in today’s highly competitive market. It can also help you establish yourself as an expert in your field, build a long-lasting network of contacts, and increase your visibility and credibility in the industry. Ernie Humphrey, aka, "The Why Guy” is a renowned specialist in this area and the CEO of [Treasury Webinars](https://www.treasurywebinars.com), a company that empowers treasury professionals to own their own career success. In our latest episode of the Two Cents podcast, Ernie chatted to us about how to create harmony across the enterprise as a finance leader, as well as: - The need for companies to control all cash movements - The challenges associated with AP, AR, and treasury departments all working in silos - How a treasury manager can break down these silos and effectively collaborate with AP and AR - How to develop a strong personal brand at work - How to build relationships with people as an introvert - Other important tips and takeaways for building your brand Tune in: Check out the highlights of our talk with Ernie below.👇 ## The importance of controlling your cash movements ***Q. I've noticed that you post a lot online about the need for companies to control all cash movements. Why are you so vocal about this topic?*** I think a big reason for me is that we're seeing all of these words and technology about AI, and there’s all this talk about financial transformation. And I think people make it too complicated. To me, the biggest impact of financial transformation should be around controlling your cash movements. Being able to predict and control your cash movements is really what gives you strategic agility to deal with all the things you can control and all the things you can't control, like supply chain, inflation, all of those good things. So, we need to be able to understand the ‘*why*’ of our movements. And then once we understand *why* it's happening, we can move towards controlling our movements and giving ourselves a little business agility. ## The challenges associated with working in silos ***Q.Do you think that AP, AR, and treasury departments all work in silos? If so, why?*** I’ve thought that it's been happening for a while, but I've done survey research in each area and asked AP leaders, AR leaders, and treasury leaders if they work in silos. And the vast majority in all areas say that they do. Working in silos really puts up inherent barriers. So for AP, even working in silos within their own departments limits the control and predictability we have on how and when we make payments, which is obviously crucial with cash going out and making our cash needs and accounts receivable. I think this has been a bigger focus for every company for the past couple of years. We have to look at being able to predict when we get paid and then also how we communicate with our customers. And so it's very dangerous for AR to be working in silos and communication with customers and outreach that's not really productive. And then for folks in Treasury, what we need to do is be able to forecast things and work with AP and AR to understand the why so we don't get in a little silo as well. When I was in Treasury, we did work in a little bit of a silo, so we really didn't take control of AP. We didn't have a strategy around how we're paying, the type of payments, and things like that. We also didn't have interactions with AR, but there wasn't enough interaction there. So in regards to working with silos, it's within the departments, but also that culture goes across the enterprise because all of those areas impact the cash conversion cycle. [How FP&A evolves & fits within a scalable growth strategyIn the episode, we explored how FP&A evolves and fits within a scalable growth strategy. Jeffrey shared his expertise on the subject, revealing practical insights on how small businesses can use FP&A as part of a scalable business model.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Jeff-blog-image-podcast.png)](https://www.financealliance.io/podcast/scalable-growth-strategy/) ## The true value of collaboration between treasury, AP, and AR ***Q. How can a treasury manager break down silos and collaborate with AP and AR?*** I talk about these topics a lot when I go to AP conferences. I look at it from their perspective, and I ask them, “*Do you collaborate with treasury?*” And then they ask me, “*How do I collaborate with treasury?*” So I try and look at it from both sides. From a treasury perspective, it's about getting everyone to understand the value of collaborating together. Treasury success should be aligned with AP success, so we should be saying, “*Hey, accounts payable, you actually have a strategic role. This is the way that you're helping us.*” It can start with, “*Hey, I was just on this podcast/I listened to this podcast/I was on a webinar and they were talking about accounts payable and optimizing how we make payments and when we make payments. So I think we should work together.*” So it's about creating that common ground. It’s the same thing on the accounts receivable side. It's like, “*Hey, we all want to get paid. But we need to understand the predictability.*” So telling them that debt predictability in addition to control gives our company our competitive advantage in this world. It's about communication, and communication depends on the person. When I was in corporate Treasury, I had to give a presentation on how we manage cash. And we invited the AP and AR people. And afterward, they said, “*Wow, I didn't know you guys were doing that.*” Then they came up and wanted to learn more. And also, some people just aren't outgoing. But there's someone in your company that has a relationship with a person that's not outgoing. So you’ve got to connect on a personal level with those folks. ## How to build your personal brand at work **Q. You mentioned the value of a strong professional brand and work. How does someone build that brand?** What your brand does is empower you to take ownership of your career. And that's the underlying mission of what I do. I've spoken to hundreds of CFOs and treasurers, and finance and accounting leaders of all sizes, including Fortune 20 companies. Every person I've asked says their success was fueled by mentorS, colleagues, and professional peers. A strong brand inspires people to want to work with you. You have to be able to offer them value, to collaborate up and down the ladder, and then across your country. Another thing I'd like to talk about is that people don't understand the dimensions of your brand. So for your professional brand, you have your value proposition, your resume, your LinkedIn profile, and your network. And your brand is on display at work. So you have a brand with your co-workers. And then in terms of your professional network, you have to look at that internally. How are you connected with people in your department and across the enterprise? So that's really looking at your network and thinking about all these things: your departmental colleagues, co-workers, customers, suppliers, peers, banks, and consultants. All these people interact with you, so you need to network with them and get them on your team. And when it comes to building that network with people you need to get in contact with, I tell people, “*Think about it this way. Who do you want to know? Who do you need to know? Who do you already know? Who knows what you want to know? And who needs what you need to know?*” There’s a big answer there, but I'm happy to have a conversation with someone about how to actually do these things because nobody talks about that. Implementing a personal branding action plan is important. [6 steps for your first project as a finance business partnerIn this blog post, Srushti Mahamuni, Operation Business Analyst at Bank of America Merrill Lynch, guides you through the six steps to get started on your first project as a finance business partner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSrushti Mahamuni![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/finance-business-partnering-project.jpg)](https://www.financealliance.io/6-steps-to-tackle-your-first-project-finance-business-partner/) ## How to build business relationships as an introvert ***Q. How does someone that doesn’t classify themselves as an extrovert go about building relationships with people that aren’t known for being friendly?*** Part of it is that you have to make yourself do it. You have to be authentic and you have to find what works for you. Oftentimes, we watch other people and we try and borrow from them, but if you're not a comedic person and you go up to someone and start telling jokes, that's kind of it. But one of the many great things about introverts is that they listen. So just listen, take opportunities, and also hang out with people that are more outgoing so you can get those natural connections. But it's trial and error. I think the biggest thing is to be authentic and not be too hard on yourself. I think that's a big part of it. It’s just judging yourself. I’m a big personality. Some people like me, and some don't, and I don't really care if people don't like me anymore. That's just who I am. So you have to be comfortable in your own skin. And sometimes, you're not going to get a good reaction from someone. They might be having a bad day. But you can't just let it shut you down. You have to give it another try. You have to keep putting the olive branch out there. And then like I said, if there's someone that you're not connecting with that somebody else knows, you might say, “*Hey, John, I'd really like to get to know Mary better. How do I do that?*” So those are some of the tips that I share with people. ## Closing thoughts I think for me, the number one thing is that your professional brand matters. That's important. But it's not rocket science. So don't make it too hard. The other thing is that I'm happy to help people make that journey. And finally, just realize that you're always *on*. So make sure you're conscious of whatever your environment is. How you're acting and reacting is all part of your brand. And to this, I always say and I'm not the best at it: *Listen, listen, listen.* That's the best career advice anyone can get. ## About Ernie ![Creating harmony across the enterprise - two cents podcast with Ernie Humphrey](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Ernie-Humphrey.png) Ernie Humphrey serves as the CEO of 360 Thought Leadership Consulting & Treasury Webinars. Over the past three years, Treasury Webinars has delivered thought leadership webinars to over 15,000 treasury and finance leaders across the globe. Ernie was a driving force behind Proformative, formerly the largest community of Finance professionals, which grew from 500 to 30,000 during his tenure. He has authored published articles on working capital management, performance management, budgeting & planning, acquisition integration, and bank relationship management in addition to articles dealing with several aspects of professional development. His e-book focused on career management and was recognized as one of the Top 10 e-books for CFOs in 2018\. Ernie was named one of the Top 20 Pioneering CEOs by Tech Magazine in 2020\. Ernie has a BS and MS in Economics both from Purdue University. **Resources & mentions from this episode:** - [Connect with Ernie on LinkedIn](https://www.linkedin.com/in/erniehumphrey/) - [Treasury Webinars](https://www.treasurywebinars.com/) - [360 Thought Leadership Consulting](https://www.threesixtytlc.com/) ### The finance function of the future: Why transformation is key for survival URL: https://www.financealliance.io/the-finance-function-of-the-future/ Last updated: 2024-06-20T11:54:10.000Z The finance function of the future has landed, and it's like nothing we've ever seen before. But along with the promise of new opportunities come unprecedented challenges that demand quick thinking, flexibility, and innovation. From digital disruption to economic uncertainties, the finance industry is facing a veritable storm of change. It's a sink-or-swim moment, and only those who can adapt will make it to the other side. In this post, we'll explore why [finance transformation](https://www.financealliance.io/your-guide-to-finance-transformation/) is the key to staying ahead of the curve. We also share predictions from top finance experts about how they see the future of finance evolving over the next 12 months. **Table of contents:** - [The current state of finance: Challenges and disruptions](https://www.financealliance.io/p/53d7fcb5-8fa3-45d6-90ca-23d5098a207b/#the-current-state-of-finance-challenges-and-disruptions) - [Key trends to watch](https://www.financealliance.io/p/53d7fcb5-8fa3-45d6-90ca-23d5098a207b/#the-future-of-the-finance-function-key-trends-to-watch) - [Predictions and insights from finance professionals](https://www.financealliance.io/p/53d7fcb5-8fa3-45d6-90ca-23d5098a207b/#predictions-and-insights-from-finance-leaders) - [How CFOs can prepare for the future of the finance function](https://www.financealliance.io/p/53d7fcb5-8fa3-45d6-90ca-23d5098a207b/#how-cfos-can-prepare-for-the-future-of-the-finance-function) ## **The current state of finance: Challenges and disruptions** The finance function is in the eye of a perfect storm, and it's testing the grit of even the most seasoned CFOs. From digital disruption to economic uncertainty to the COVID-19 pandemic, finance teams are facing a wave of challenges that demand adaptability, creativity, and agility. Here are some of the biggest disruptions that finance teams must navigate in today's business landscape: ### Digital disruption The digital revolution is in full swing, and finance teams must keep pace with new technologies or risk being left behind. From blockchain to artificial intelligence and machine learning, these tools offer tremendous opportunities for efficiency, insight, and growth. But they also demand new skill sets and a fundamental shift in traditional finance processes. ### Economic uncertainties The global economy is more volatile than ever, with factors such as trade tensions, political instability, and currency fluctuations driving uncertainty and risk. In this environment, finance teams must balance the need for strategic investments and growth with the imperative of risk management and financial stability. ### Cybersecurity threats The rise of digital technology has also brought with it a new breed of security threats, such as hacking, data breaches, and cyberattacks. These threats can have devastating consequences for businesses such as reputational damage and even financial loss. Because of these threats, finance teams must work closely with IT and security experts to safeguard systems and data. ### Talent shortages As the finance function becomes more complex and specialized, finding the right talent has become a major challenge. CFOs must compete for top talent in a crowded and competitive marketplace, while also developing their existing teams to meet the demands of the future. ### Regulatory compliance Regulations and compliance requirements are becoming more complex and stringent, particularly in industries such as finance and healthcare. CFOs must ensure that their teams are up to date on the latest rules and regulations. This means finance functions will need to have the right systems and processes in place to meet these requirements. ### COVID-19 pandemic The COVID-19 pandemic has been a seismic event for businesses, with finance teams on the front lines of the response. From managing cash flow to financial reporting to scenario planning, CFOs must navigate a rapidly changing landscape and make critical decisions in the face of uncertainty. These disruptions are not just challenges, they're also opportunities for you to innovate and transform for the future. But to do so, you must be willing to take risks, experiment, and continuously learn and develop new skills. --- [Your Guide to Finance Transformation | Finance AllianceIn this guide, we’ll delve into the exciting world of finance transformation and explore how you can harness its power to take your business (and your career) to the next level.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Hub-page-finance-transformation.jpg)](https://www.financealliance.io/your-guide-to-finance-transformation/) --- ## **The future of the finance function: key trends to watch** Will [big data analytics](https://www.financealliance.io/what-is-big-data-security-analytics/) continue to make waves in the industry, or will embedded finance rise as the biggest game changer? Here are some key trends to watch out for: ### The rise of automation In the finance function of the future, machines will be doing more of the heavy lifting. [Robotic process automation](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) (RPA) and intelligent automation are taking over routine tasks like data entry, freeing up finance teams to focus on more strategic initiatives. With automation, finance teams can work smarter, not harder. ### The cloud is king Finance teams are flocking to the cloud for its flexibility, scalability, and cost savings. With cloud computing, you can access data from anywhere, collaborate in real-time, and benefit from advanced analytics and reporting capabilities. ### AI is the future Artificial intelligence (AI) is transforming the finance function, from improving forecasting and risk management to detecting fraud. With AI, finance teams can analyze vast amounts of financial data and gain valuable insights and recommendations that can help drive better decision-making. ### The Blockchain revolution The potential of blockchain technology to revolutionize financial transactions cannot be ignored. Offering security, transparency, and speed, blockchain has the potential to transform the way finance teams manage transactions, contracts, and more. ### The importance of cybersecurity With the rise of cybersecurity threats, finance teams are investing heavily in security measures to protect against data breaches and cyberattacks. Biometric authentication, multi-factor authentication, and security information and event management (SIEM) systems are becoming increasingly important. ### The power of data analytics With the right data analytics tools and processes in place, you can quickly gain valuable insights into financial performance, trends, and opportunities. By leveraging data analytics, finance teams can make more informed decisions and drive greater business value. As the finance function continues to evolve, you’ve got to stay on top of the latest trends and innovations in technology. By embracing these trends and using technology to your advantage, you can thrive in the finance function of the future. --- [Robotic Process Automation in Finance: 5 benefits of RPAIn this post, you’ll find out how to use RPA to streamline financial processes. We’re also sharing five amazing benefits of using automated RPA software.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/robotic-process-automation-in-finance-2.jpg)](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) --- ## **Predictions and insights from finance leaders** What do finance professionals have to say about all of this? Below, we investigate some key insights from our [*State of Finance Transformation Report*](https://www.financealliance.io/state-of-finance-transformation-report-2022/) to uncover what the experts predict will reign supreme in the world of finance over the next 12 months. ### **Which technology will be the biggest game changer?** We wanted to know what type of technology movements finance professionals predict will rise above the rest over the next 12 months. And, the findings were very interesting, to say the least. Buy now, pay later, came in 5th place with 3.7% of respondents predicting that it’ll be the biggest game changer. In 4th place, open banking/embedded finance swooped in with 11.1% of votes. In joint second place with 14.8% of the votes each was Cloud and self-service technology/chatbots. Coming out on top, with 55.6% of respondents predicting it’ll be the biggest game changer over the next 12 months, was big data analytics. ![Future of finance function predictions](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/data-src-image-jj3a57z2aj.png) ### **Which area is the most critical for future investment?** We asked our surveyed finance professionals to tell us which area they think is the most important for organizations to invest in to help streamline financial processes and almost half (48.1%) chose data and real-time analytics. Next up was legacy technology replacement/modernization (14.9%), which tells us that a lot of finance professionals believe their existing technology just doesn’t cut it. Whether it needs to be updated or replaced completely, it’s clear that a technological revolution needs to happen within certain organizations. ![finance transformation trends](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/data-src-image-7cbigbin5ta.png) ### **How will digital finance transformation evolve over the next 12 months?** Although none of our participants are active fortune-tellers (*as far as we know*), they were keen to share their thoughts on how finance transformation will evolve over the next 12 months. Many talked about the likelihood of seeing increased speed when it comes to accessing and analyzing data to improve performance. Less manual processes and more automated tasks were other predictions that showed up time and time again. Here are some more insights and predictions about the evolution of finance transformation from our survey respondents: > *“It will be part of a crucial process for many companies to keep up in the market.”* “*It will continue to become more streamlined as technology advances and becomes more accessible to all levels of a team (plus integration with existing tools)*.” > *“I see how the world is stepping back from globalization; thus, I assume regulatory will be the priority (sanctions, embargoes, etc.).”* *“The adoption rate will be much quicker than expected and the haves and have-nots will be apparent.”* > *“12 months is a short time. We need at least 36 months for the entire finance monthly cycle time to go down. I also predict we’ll use a rise in the use of rolling forecast models instead of annual budget preparations.”* *“With an uncertain economic outlook, the hurdle to get projects approved or funded will increase. A clear strategy and project prioritization, with a robust cost-benefit model, will be even more important.”* ![Future of the finance function prediction - Brian Kalish](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/data-src-image-wjvu8zyglz.png) ![Future of the finance function prediction - Tjendra Halima](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/data-src-image-6xo9c9a3ezo.png) ## **How CFOs can prepare for the future of the finance function** Preparing for the finance function of the future can seem like a daunting task, but it's essential for CFOs who want to stay ahead of the curve. Fortunately, there are some [key steps CFOs can take](https://www.financealliance.io/5-change-management-strategies-finance-transformation/) to ensure their finance function is ready to face the challenges and opportunities of the future. Here are some tips from finance experts and respondents from our survey to help you get started: Make digitalization a core change requirement. - Continue to keep skills fresh and challenge the status quo to find new opportunities/innovations. - Set a vision and communicate it. - Learn more about FT and how it relates to your business. - Don’t delay transformation for a big-bang implementation. Empower everyone to transform their function. - Encourage learning and training. - Dedicate time to the topic, and benchmark with peers and SMEs. - Organize the processes and have good software to collect the data. - Expand knowledge. Explain the long-term benefits. - Strategic review and plan to show how the finance team can be a profit center. - Better planning is key (long-term thinking). - Be open-minded and update your skills regularly. - Clean house to work optimally in the technology environment/business environment you’re currently in and keep an eye out for those transformations/technologies that will have the largest impact on their specific organization/industry. ![Andrew Jepson - advice for CFOs](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/data-src-image-gcg0e7j5sj5.png) ![Brian Kalish - advice for CFOs](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/data-src-image-2i9yqixzj2o.png) ![Tjendra Halima - advice for CFOs](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2024/06/data-src-image-88ndzoy3fyg.png) While we don’t know what’ll happen this time next year, or even tomorrow, we do know that financial transformation isn’t likely to fade into our distant memories anytime soon. If anything, it’ll continue to evolve and get even better at helping to make your life as a finance professional that much easier, freeing up your time to spend on more influential tasks, such as helping other functions and solving business problems. The challenges and disruptions facing the industry are significant, but so are the opportunities for those who are willing to embrace change. By leveraging technology, investing in talent, and focusing on strategic partnerships, CFOs can position their finance functions for success in the years ahead. Ultimately, the imperative for finance transformation is clear: it's the only way for finance functions to survive and thrive in the face of an ever-changing business landscape. --- ### **Download The State of Finance Transformation Report!** **Key topics discussed in this report include:** 💡 Where finance transformation is **now**. 🔑 **Key drivers** of finance transformation. 💰 The positive impact of **automation in finance**. 🤔 **Common challenges** and how to overcome them. ⚒️ How to develop a **culture of change**. 🔮 What a **successful adoption** of finance transformation looks like. ….and so much more. ### **Ready to get stuck in?** Grab your copy today and discover the real impact of finance transformation on not just organizations, but the everyday life of finance pros like you! 👇 [Get your copy](https://form.typeform.com/to/f5Yjq66a?typeform-medium=embed-snippet) ### Your guide to finance transformation URL: https://www.financealliance.io/your-guide-to-finance-transformation/ Last updated: 2026-04-24T14:26:02.000Z Finance transformation is a crucial business strategy gaining traction across industries worldwide. Gone are the days when you spent most of your time manually inputting data into spreadsheets (*yawn!*). Now, with the help of automation, you can free up valuable time and offer your unique expertise to influence key decisions and drive the business forward. But, as with any transformative business strategy, it's essential to get buy-in from the top. So, how can you convince stakeholders to invest in finance transformation? And perhaps more importantly, how can you leverage technology to drive positive change? In this guide, we'll delve into the exciting world of finance transformation and explore how you can harness its power to take your business (and your career) to the next level. **In this guide, you’ll learn:** - [The definition of finance transformation](https://www.financealliance.io/p/05df67e2-d807-4f08-81d6-25df27317cae/#what-is-finance-transformation) - [Why it’s so important](https://www.financealliance.io/p/05df67e2-d807-4f08-81d6-25df27317cae/#why-is-a-financial-transformation-so-important) - [Benefits of digital transformation in finance functions](https://www.financealliance.io/p/05df67e2-d807-4f08-81d6-25df27317cae/#benefits-of-digital-transformation-in-finance) - [Challenges of implementing new technologies](https://www.financealliance.io/p/05df67e2-d807-4f08-81d6-25df27317cae/#challenges-of-implementing-new-technologies) - [How to overcome challenges ](https://www.financealliance.io/p/05df67e2-d807-4f08-81d6-25df27317cae/#how-to-overcome-these-challenges) - [Automation and machine learning in finance](https://www.financealliance.io/p/05df67e2-d807-4f08-81d6-25df27317cae/#automation-and-digital-transformation) - [Building a finance transformation roadmap](https://www.financealliance.io/p/05df67e2-d807-4f08-81d6-25df27317cae/#how-to-build-a-finance-transformation-roadmap) # **What is finance transformation?** Have you ever heard the saying, "*out with the old, in with the new*"? Well, finance transformation takes that mantra to a whole new level. At its core, finance transformation is a strategic initiative that aims to revamp financial systems, processes, and capabilities to enhance business performance and drive sustainable growth. The main drivers of finance transformation are to: - Streamline financial operations - Improve decision-making - Enhance the efficiency and effectiveness of financial processes But it's not just about implementing new software and tools. Finance transformation is a holistic approach involving everything from financial planning and analysis (FP&A) to accounting, reporting, and risk management. To succeed in [finance transformation](https://www.financealliance.io/what-is-finance-transformation/), you must have a deep understanding of your company's goals, customer needs, and market dynamics. Once you're clear on those things, you can create a roadmap that aligns with your overall strategy. Now, we won't sugar-coat it - finance transformation can be a complex and timely process. But, when executed successfully, it can help improve your financial processes, and business decisions, and position your business for sustainable growth. --- ## **Why is a financial transformation so important?** In today's fast-paced business landscape, companies must continually evolve to stay competitive. And, as finance professionals, we must adapt to this new reality by embracing financial transformation. Gone are the days when digital transformation was considered an optional extra. Today, it's a necessity if you want to keep up with the competition and achieve your company's goals. CFOs have a critical role to play in the digitalization of organizations. They must focus on enabling their finance function to deliver faster and more accurate data to support critical decision-making processes. This data must be reliable and timely to ensure effective decision-making. Failure to do so can result in falling behind competitors and missing out on valuable opportunities. --- [3-step finance maturity assessment for finance functionsWant to achieve a successful finance function transformation? Start by following this 3-step maturity assessment framework!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AlliancePierre-Alain Liegeois![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/businessman-g63ce8b3c6_1920-2.jpg)](https://www.financealliance.io/maturity-assessment-finance-function-transformation/) --- We reached out to some finance experts to get their take on why finance transformation is so important. Here's what they had to say: > *“Finance transformation is a journey and not a destination. Finance Transformation is not just about implementing changes to the finance organization and operating model, re-platforming the finance processes and systems, or upgrading the existing digital technologies to increase the overall value of the finance function; it is more about reimagining the finance vision and strategy that is fully aligned with the overall enterprise-wide strategy and ambition to deliver sustainable and profitable growth story.”* \- ***Tjendra Halima, Chief Financial Officer & Management Consultant at Digital CFO Advisory Services*** --- > *“Technological progress happens exponentially. Most of the tasks we do today are digital, so we also need to bring that progress to our industry. Take advantage of the best in technologies to deliver more assertive and efficient analysis.” - *Paula Mota, FP&A Analyst at BRZ Insurance** --- > *“Given all the stresses and strains organizations have experienced over the past 2+ years, the need to modernize the finance function has never been more acute. We are operating in a world of ultra-high VUCA (Volatility, Uncertainty, Complexity, Ambiguity) hopefully, the highest level we will ever experience.* > *“CFOs need a Finance function that enables the strategic ambitions of the enterprise in this volatile environment. For most organizations, those ambitions feature transformation.” - *Brian Kalish, Principal and Founder at Kalish Consulting** --- [How finance digital transformation can impact your companyIn today’s fast-paced business world, finance digital transformation is crucial for organizations to stay ahead of the game. From streamlining processes and increasing efficiency to providing real-time insights and improving data accuracy, financial transformation is the ultimate game changer.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/finance-digital-transformation-header-image.jpg)](https://www.financealliance.io/how-finance-digital-transformation-impact-company/) --- ## **Benefits of digital transformation in finance** Finance transformation is a game-changing process that can help companies take their financial management practices to the next level. But what exactly are the benefits of finance transformation, and how do they impact the finance function? Here are just a few: ### 1\. Real-time access to financial data across the organization By having up-to-date data on hand, finance teams can quickly: - Identify potential issues and opportunities - Monitor financial performance - Measure progress against KPIs With a comprehensive view of financial data, you'll be able to communicate better with stakeholders. This includes investors, customers, and business partners, which can help build trust and enhance an organization's reputation. ### 2\. More streamlined business processes and financial operations By creating a more efficient workflow, finance teams can reduce manual errors and improve accuracy, which saves time and resources. This streamlined approach also creates a better experience for customers and suppliers. One of the main reasons being the elimination of bottlenecks in the financial process and the acceleration of the order-to-cash cycle. When we asked participants of our [State of Finance Transformation Report](https://www.financealliance.io/state-of-finance-transformation-report-2022/) what drives the need to adopt new technologies, a desire for more efficient processes came out on top with **92.6%** of respondents in agreement. Here are some more drivers of finance transformation within organizations: ![Main drivers of financial transformation - The State of Finance Transformation Report](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Drivers-of-finance-transformation.png) Source: [The State of Finance Transformation Report ](https://www.financealliance.io/state-of-finance-transformation-report-2022/)by Finance Alliance ### 3\. A single source of truth for financial data Having a single source of truth for financial data reduces confusion and errors. All stakeholders have access to the same data, which means you don’t have to worry about discrepancies, conflicting information, or manual reconciliations. The result? A more accurate and reliable view of financial data makes decision-making easier and more efficient. Another reason why having a single source of truth is so beneficial is that it helps reduce the risk of data breaches or other security issues, as all financial data is stored in a centralized, secure location. ### 4\. The automation of time-consuming, manual finance tasks By automating tasks like invoice processing and account reconciliation, finance teams can improve accuracy and reduce the risk of errors. Automation also frees up time, allowing finance teams to focus on higher-value activities, such as strategic planning, financial analysis, and risk management. ### 5\. Improved collaboration and communication across the organization Finance transformation projects improve collaboration and communication across the organization by providing better access to financial data and streamlining financial processes. **96.3%** of the respondents of our report agreed that technology helps to provide more opportunities to collaborate with other departments including administration/operations, marketing and sales, human resources, customer service, and more. ![How digital transformation in finance increases collaboration](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Collaboration-1.png) Source: [The State of Finance Transformation Report](https://www.financealliance.io/state-of-finance-transformation-report-2022/) Ultimately, improved collaboration can help the organization achieve strategic goals and enhance its competitive advantage. We asked a few finance leaders to share their thoughts on how they believed finance transformation positively impacts the roles of finance professionals, from FP&A Managers to CFOs. Let’s see what they had to say: ![Benefits of finance transformation quote from Angelina Hendraka](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/digital-finance-transformation-1.png) ![Benefits of finance transformation quote from Brian Kalish](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Brian-Kalish-finance-transformation.png) ![Benefits of finance transformation quote from Paula Mota](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/paula-finance-transformation-quote.png) ![Benefits of finance transformation quote from Tjendra Halima](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/Finance-function-transformation.png) ## **Challenges of implementing new technologies** Embarking on a journey towards a better financial future can be a thrilling adventure, but it's not without its fair share of challenges. The path to finance function transformation can be a bumpy one, and businesses must be prepared to navigate through some obstacles along the way. Here are some of the key hurdles companies often face during the finance function transformation process: **Resistance to change:** Finance professionals may be accustomed to the way things have always been done and may be reluctant to embrace new methods. However, with the right approach and communication, organizations can win over the hearts and minds of their finance teams and get them on board with the change. **Integration issues:** Integrating new systems and processes with existing ones can be like fitting a square peg in a round hole. There may be unforeseen complications, leading to delays and additional costs. However, by taking a proactive approach and planning ahead, businesses can reduce the risk of integration issues. **Data quality issues:** Accurate and reliable financial data is crucial to success, and any issues in this area can have severe consequences. To mitigate this risk, organizations must prioritize data quality and ensure that they have the right tools and processes in place to maintain it. **Lack of expertise:** Finance transformation requires specialized knowledge in both IT and financial processes and systems. Organizations may not have the necessary expertise in-house, leading to additional costs and delays. In such cases, outsourcing or partnering with a specialist can be an effective solution. **Budget constraints:** Transforming your finance function can be a costly endeavor. Limited funds can be a significant challenge, and organizations must find ways to invest wisely and make the most of their resources. **Time constraints:** [Finance transformation](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) is a time-consuming process, and companies may find it challenging to balance the need for transformation with day-to-day operations. **Lack of a digital transformation strategy:** Without a clear digital transformation strategy, digital transformation efforts can lack direction and may not align with overall business goals. This can lead to a lack of focus and wasted resources. **Security concerns:** The implementation of new financial systems and processes can pose security risks, such as data breaches or cyber-attacks. It is essential to ensure that appropriate [data security measures](https://www.financealliance.io/what-is-big-data-security-analytics/) are in place to mitigate these risks and protect sensitive financial data. By understanding the challenges and taking steps to address them, organizations can increase their chances of a successful transformation. --- [5 CFO change management strategies: finance transformationWith the right approach, you can effectively manage this resistance and bring your finance team into the modern age of digitalization and in this blog post, we’ll show you how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Change-management-strategies-for-cfos.jpg)](https://www.financealliance.io/5-change-management-strategies-finance-transformation/) --- ## **How to overcome these challenges** | Challenge | Solution | | ----------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | Resistance to change | Involve employees in the transformation process from the outset. Communicate the benefits of the transformation and provide training and support to help employees adapt to new ways of working. | | Integration issues | Assess the compatibility of new systems and processes with existing ones before implementation. Pilot testing and phased implementation can help identify and address integration issues before they become major problems. | | Data quality issues | Establish clear data governance policies and procedures. Regular data quality checks and audits can help identify and address any issues. | | Lack of expertise | Hire external consultants or partner with vendors who specialize in finance transformation. This can help ensure that the transformation is implemented effectively and efficiently. | | Budget limitations | Explore different financing options such as leasing or financing arrangements. It's also important to prioritize investments based on the expected ROI and to seek out cost-effective solutions where possible. | | Time constraints | Create a realistic timeline and allocate sufficient resources to the transformation project. Prioritizing tasks and breaking the project down into smaller, manageable components can also help ensure that the transformation stays on track. | | Lack of a digital transformation strategy | Develop a clear and comprehensive strategy that aligns with their overall business goals. This strategy should include a roadmap for finance transformation that outlines key milestones and timelines. | | Security concerns | Implement robust security measures and protocols to protect sensitive financial data. This may include encryption, access controls, and regular security audits and testing. | ![Finance transformation challenges and solutions - Angelina Hendraka](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/03/finance-transformation-challenges.png) ## **Automation and digital transformation** The use of [automation and machine learning](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) in the finance function has truly revolutionized the way CFOs approach financial data analysis. With these cutting-edge technologies, finance teams can make better decisions *faster*, which can ultimately drive business growth. By automating manual finance tasks, such as accounts payable and receivable, finance teams can eliminate time-consuming and error-prone manual processes. This not only frees up time for more strategic tasks, but it also reduces the risk of human error, ultimately leading to increased accuracy. --- [Robotic Process Automation in Finance: 5 benefits of RPAIn this post, you’ll find out how to use RPA to streamline financial processes. We’re also sharing five amazing benefits of using automated RPA software.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/robotic-process-automation-in-finance-2.jpg)](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) --- Machine learning takes this a step further, allowing CFOs to improve financial forecasting and risk management. By analyzing historical financial data, machine learning algorithms can identify patterns and trends that may not be visible to the human eye. These insights can be used to make more accurate predictions about future financial performance, as well as identify potential financial risks and provide recommendations to mitigate those risks. As more and more companies adopt these technologies, we can expect to see even greater improvements in financial performance and decision-making. However, it is important to note that automation and machine learning are not a silver bullet. CFOs must still exercise sound judgment and use these tools to augment, rather than replace, their financial expertise. --- [5 tips for CFOs to accomplish finance digital transformationAs the CFO, you’ll lead the charge for finance digital transformation within the organization. But doing so takes some work. Here are 5 ways CFOs can drive finance digital transformation, optimize business processes, and even enhance overall profitability.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/finance-digital-transformation.jpg)](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) --- ## **How to build a finance transformation roadmap** To create a [successful finance transformation](https://www.financealliance.io/10-principles-thatll-make-your-finance-transformation-successful/), you need to understand how it aligns with business strategy, allocate resources to initiatives that'll deliver the most business value, manage expectations and monitor/measure the overall success of the transformation. Ready to build your finance transformation roadmap? Let's dive into the four stages of the process in more detail: ### 1\. Assess To assess your current state, start by identifying the pain points and areas of opportunity for improvement within your finance function. This includes evaluating your current financial systems and processes, as well as the skills and capabilities of your finance team. You may also want to conduct a gap analysis to compare your current state to where you want to be in the future. This will help you define your vision for the finance function and determine the key initiatives that will drive transformation. ### 2\. Design The design stage involves creating a blueprint for the future state of your finance function. This includes defining the new financial processes, selecting the new financial systems, and defining new roles and responsibilities for the finance team. To design the new processes, consider best practices and benchmarking against industry standards. When selecting the systems, ensure they align with your vision and can integrate with other systems you use. Finally, define new roles and responsibilities for your finance team that align with the new processes and systems. ### 3\. Build With the blueprint in place, it's time to start building. This stage involves implementing the new financial processes and systems defined in the design stage. Your main tasks will include configuring the new financial systems, migrating data from old systems to new ones, and training the finance team on new processes and systems. This is also a good time to communicate the changes to the broader organization and prepare for any potential impacts on other departments. ### 4\. Operate The final stage is all about running the new financial processes and systems, monitoring performance, and continuously improving the function. Establish performance metrics and monitor the performance of the transformation initiatives against those metrics. Make adjustments as needed and continuously improve the function. This stage is also a good time to review your progress and celebrate your successes. --- By following these four stages, you can build a successful finance transformation roadmap that aligns with your business strategy and delivers the most business value. Remember to allocate resources to the initiatives that will deliver the most impact and manage expectations throughout the process. With a well-designed roadmap, you can achieve a more efficient and effective finance function that drives better financial performance. Finance transformation is a critical process that can help organizations improve their financial performance and achieve strategic goals. By leveraging [automation](https://www.financealliance.io/how-finance-automation-is-changing-role-fpa/), machine learning, and data analytics, CFOs can make better-informed decisions, reduce manual workloads, and increase efficiency. --- ### Download The State of Finance Transformation Report! **Key topics discussed in this report include:** 💡 Where finance transformation is **now**. 🔑 **Key drivers** of finance transformation. 💰 The positive impact of **automation in finance**. 🤔 **Common challenges** and how to overcome them. ⚒️ How to develop a **culture of change**. 🔮 What a **successful adoption** of finance transformation looks like. ….and so much more. ### **Ready to get stuck in?** Grab your copy today and discover the real impact of finance transformation on not just organizations, but the everyday life of finance pros like you! 👇 [Get your copy](https://form.typeform.com/to/f5Yjq66a?typeform-medium=embed-snippet) ### 6 steps to tackle your first project as a finance business partner (like a pro!) URL: https://www.financealliance.io/6-steps-to-tackle-your-first-project-finance-business-partner/ Last updated: 2024-06-20T11:21:58.000Z Are you a finance professional starting out as a business partner for the first time? Congratulations, you're about to embark on an exciting journey that'll push your skills and expertise to new heights. But, let's be honest, it can also be a little overwhelming. As a [finance business partner](https://www.financealliance.io/number-crunchers-finance-business-partners/), you'll be expected to provide financial insights and strategic guidance to support decision-making across the organization. It's a challenging role, but with the right mindset and approach, you can tackle your first project with confidence and ease. In this blog post, Srushti Mahamuni, Operation Business Analyst at Bank of America Merrill Lynch, guides you through the six steps to get started on your first project as a finance business partner. So, let's dive in! ## How to make your first project a success ### Step 1 – Set yourself a 90-day deadline for your project. By the end of 90 days, you should either have your improvement recommendations agreed upon, adopted, and actioned – or at least have your recommendations agreed upon and in progress. Keep the momentum, don’t let things ‘slide’, and don’t let the project scope ‘creep’. ### Step 2 - Choose a problem that really needs to be resolved or an opportunity that can’t be ignored. Make sure it has a significant quantifiable benefit – or resolves a recognized ongoing issue. The idea of the project is to illustrate how Finance (and you) can help your operational managers improve the business’s performance. So, when complete, it must be something that can be celebrated and talked about across the business. ### Step 3 – Make sure it’s something you can tackle alongside your ‘day job’. You’ll already have a host of regular Finance duties to perform and timetables to achieve, so you’ll need to create the capacity to take on the project. Likely, that will require a bit of prioritization, a bit of delegation (if that’s possible), a bit of negotiation, and a commitment from you to work extra hours, where and when needed. --- [How to become a successful finance partnerWant to know how to become a successful finance partner? The role of the finance function has changed massively over recent years. Rather than generating reports all day, finance pros must step into a partnership role and work closely with other functions of the business.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/money-g094a1229b_1920-2.jpg)](https://www.financealliance.io/podcast/3-pillars-successful-finance-partner/) --- ### Step 4 - Decide what data you’re going to need for the project – and where and how to get it. It’s also worth considering getting what Tom Peters calls a ‘CHRO’ (Chief Hurdle Removal Officer) on board for when you hit a roadblock (the hurdles and roadblocks are often human). > “A financial business partner bridges the gap between raw data and powerful insights.”- **Srushti Mahamuni, Operation Business Analyst at Bank of America Merrill Lynch** ### Step 5 - Decide what knowledge and skills you’ll need to ‘brush up’ on for this project. Often, it’s the ‘soft’ skills that need to be honed. They are the skills that those operating in more traditional accounting roles where logic, standards, and ‘right’ or ‘wrong’ apply, don’t get the same opportunity to exercise. Brilliant analysis and important insight won’t improve performance if you can’t ‘sell’ the idea. Just because it looks like a ‘no-brainer’ to you, doesn’t mean it will ‘fly’. ### Step 6 - Choose someone experienced, whom you trust, to be your ‘sounding board’. It’s very easy to get wrapped up in a project and go off down a blind alley or put forward an idea that on paper or spreadsheet looks good, but is impractical or not sellable. --- [How Finance professionals can measure their business impactMany Finance professionals strive to become better business partners supporting the business through insights and decision-support. But how do you measure whether you are succeeding as a finance business partner? This article presents three ways to measure your impact as a finance business partner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceChristian Frantz Hansen![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/hourglass-g627873e27_1920-2.jpg)](https://www.financealliance.io/how-finance-professionals-can-measure-their-business-impact/) --- ## 9 quickfire tips to help you succeed in the early stages 1. Leverage your contacts better. 2. Take every opportunity to work alongside other business areas. 3. Be clear about how your role helps the business. 4. Meet up with anybody who benefits from what you do. 5. Be interested in what non-Finance areas do. 6. Listen for what’s important and try to help with it. 7. Be the one to link everything to business strategy. 8. Don’t just crunch the numbers, understand them. 9. Talk value. --- ### Want to learn more about finance business partnering? Our [Finance Business Partnering Playbook](https://www.financealliance.io/finance-business-partnering-playbook/) is the perfect resource for anyone who wants to deepen their understanding of this important role. Our comprehensive guide covers everything from the basics of finance business partnering to the key skills and competencies required to succeed in this role. With practical tips from some of the most influential names in finance, this playbook is designed to help you navigate the challenges of finance business partnering with confidence and ease. Download our playbook today and discover how finance business partnering can help you drive strategic value for your organization.👇 [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1000/2023/02/FA_Finance_Business_Partnering_Playbook_CTA.jpg) ](https://www.financealliance.io/finance-business-partnering-playbook/) ### How was your experience at the FP&A Summit? - Deb Poch, Stacked Analytics URL: https://www.financealliance.io/virtual-summit-case-study-deb-poch/ Last updated: 2023-02-24T10:00:38.000Z [Deb (Stracker) Poch](https://www.linkedin.com/in/debpoch/) is the Founding Partner and Strategic Consultant of Stacked Analytics, a community of experts designed to solve the most challenging data and analytics problems facing people today. Back in November 2022, Deb attended the [FP&A Summit](https://summit22.financealliance.io/?%5Fgl=1%2A1ne4l5y%2A%5Fga%2AMTYxNzU4NjkxLjE2NzI3Mzk5MDI.%2A%5Fga%5F2NXFSBEP4N%2AMTY3NzA3MzIwNS4yMDMuMC4xNjc3MDczMjA1LjAuMC4w), a virtual event consisting of two days designed to keep finance professionals ahead of trends and arm them with the skills they need to drive their careers forward. We caught up with Deb to get her thoughts on the event and in this case study, she discusses: ## Why did you want to attend our virtual FP&A Summit? I learned about the Summit through Finance Alliance’s posts on [LinkedIn](https://www.linkedin.com/company/73979524/) & in the [Slack community](https://www.financealliance.io/community/). I wanted to hear what was top of mind for FP&A leaders and practitioners. There is a lot of crossover and similar responsibilities shared by analytics and financial planning and analysis teams. I wanted to hear about the state of finance transformation in the FP&A community. --- [Top finance events to attend | Finance Alliance2023 is set to be an exciting year with a range of finance events taking place around the world that offer opportunities to learn, network, and grow. Have your calendar ready as we drop the ultimate round-up of top finance events to attend in 2023.👇🏽![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Finance-events.jpg)](https://www.financealliance.io/top-finance-events/) --- ## Were there any particular insights that you found interesting? Yes, several. In the concept of value planning from a risk perspective, the CFO is the new chief feelings officer, and getting the right people in the right seat is paramount to FP&A's success. ## How are you going to apply the findings from the FP&A Summit in your current role? I will bring these insights into my data strategy engagements with my clients. One of the areas where analytics organizations struggle is showing how they add value; aligning with and enabling finance teams is a huge win for companies as there is a symbiotic value created here if done right. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) --- ## What was your favorite speaker session and why? I enjoyed Stefan’s talk on using risk assessment to add value. It was also a great reminder of how military veterans add value to the corporate perspective. ## What was your biggest takeaway from the event? The FP&A function is amid a transformation both technically and from a mindset perspective in how they interact and add value to organizations. ## How did this event stand out compared to others on the market? It was cool. It was nice to hear from industry practitioners about what is top of mind for them. In the analytics world, they share content in a forum called MeasureCamp. It would be cool to see something like this where it is interactive at the end more than questions in a chat for finance professionals. ## Would you recommend other finance professionals to attend one of our events? Yes --- ## Want to attend our next event?**🎤** Check out the [blog post](https://www.financealliance.io/top-finance-events/) below for the line-up of some of the best upcoming virtual and in-person events of the year - including our famous FP&A Summits, CFO Summits and more! [Top finance events to attend | Finance Alliance2023 is set to be an exciting year with a range of finance events taking place around the world that offer opportunities to learn, network, and grow. Have your calendar ready as we drop the ultimate round-up of top finance events to attend in 2023.👇🏽![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Finance-events.jpg)](https://www.financealliance.io/top-finance-events/) ### 5 powerful CFO change management strategies for finance transformation URL: https://www.financealliance.io/5-change-management-strategies-finance-transformation/ Last updated: 2025-10-01T12:05:43.000Z As we all know, change management strategies are critical to the success of finance transformations. But what happens when you experience pushback against the idea of introducing new technology to the finance function? It’s a tricky one because resistance to change can quickly undermine even the most thought-out plans. But with the right approach, you can effectively manage this resistance and bring your finance team into the modern age of digitalization and in this blog post, we’ll show you how. **Topics covered:** - [Understanding the resistance to change](https://www.financealliance.io/p/cefc8375-f1b1-4a8f-9344-f75054fe9d3b/#understanding-the-resistance-to-change-why-change-management-strategies-are-so-important) - [Building a case for change](https://www.financealliance.io/p/cefc8375-f1b1-4a8f-9344-f75054fe9d3b/#building-a-case-for-change) - [Change management strategies](https://www.financealliance.io/p/cefc8375-f1b1-4a8f-9344-f75054fe9d3b/#strategies-for-successful-change-management) - [Change management quotes](https://www.financealliance.io/p/cefc8375-f1b1-4a8f-9344-f75054fe9d3b/#change-management-quotes-tips-from-finance-leaders) ## **Understanding the resistance to change: Why change management strategies are so important** Resistance to change is a natural reaction to any major change and can come in many forms, including fear of the unknown, loss of control, or lack of trust in leadership. Understanding the reasons *behind* the resistance and developing effective change management strategies is key to overcoming these obstacles and achieving the desired outcome. So, let’s get into why so many are resistant to change, even if that change can have a positive impact. ### Fear of the unknown At the root of most resistance is a fear of the unknown. Not many people want to admit it, but stepping into the unknown can be terrifying. When you introduce new technologies that completely rewire traditional processes and systems, you should prepare and even expect some backlash from your team. Try to be empathetic and understanding about where this backlash is coming from. People on your team may be worrying about how these new tools and software will impact their job security, their workload, and/or their daily routines. This fear can lead to feelings of anxiety and uncertainty, which can quickly turn into resistance. ### Loss of control Another common reason people resist change is a loss of control. When [finance transformations](https://www.financealliance.io/what-is-finance-transformation/) change processes, systems, or technology, it can leave employees feeling like they no longer have control over their work. This can lead to a lack of motivation, low morale, and, ultimately, resistance to the new change you’re trying to implement. ### Lack of trust in leadership Don’t take it personally, but one of the most common reasons for resistance to change in the workplace often links to a lack of trust in leadership. When employees don't believe that leadership has their best interests at heart or is transparent about the reasons for change, it can create a sense of distrust that can lead to resistance. As a CFO, it's your responsibility to understand these reasons for resistance and to develop strategies to address them. By tackling the underlying concerns and fears of stakeholders, you can minimize resistance and promote a positive attitude toward change. --- [3 principles to lead with confidence through changeAs a finance leader, you need to learn how to lead through change with confidence & in this post, Stephen Newland, Director of FP&A, shares how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceStephen Newland, CMA![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/Finance-leader.jpg)](https://www.financealliance.io/3-principles-to-lead-with-confidence-through-change/) --- ## **Building a case for change** Building a compelling case for change is one of the most critical steps in managing resistance to [finance transformation](https://www.financealliance.io/tag/finance-transformation/). By addressing the concerns of stakeholders and clearly articulating the benefits of the transformation, you can create buy-in and minimize resistance. So, how do we build a case for change that resonates with stakeholders and drives the finance transformation forward? Here are a few key steps: ### 1\. Clearly articulate the problem Start by clearly defining the problem you want to solve. For your organization, this could be anything from dealing with inefficiencies in the current processes to improving financial reporting and overall transparency. By articulating the problem you’re trying to solve with new tools and software, you’ll help stakeholders understand the need for change. ### 2\. Highlight the benefits > *“Be a vocal leader and supporter and emphasize the benefits of the changes.*” Next, focus on the [benefits of the finance transformation](https://www.financealliance.io/how-finance-digital-transformation-impact-company/). Be specific about how the transformation will improve existing processes, maximize efficiency, drive innovation, etc. Make sure to highlight how these benefits will positively impact stakeholders, both individually and as a team. ### 3\. Address concerns At this stage, you’ll likely get some feedback from your team and/or other members of the organization. This could include concerns about job security, increased workload, or the need for additional training. Make sure that you listen to feedback and don’t brush it under the rug. Instead, address these concerns head-on and help others see the positive aspects of the change. ### 4\. Get buy-in from key stakeholders > *“Use a strategic and collaborative approach and include all stakeholders in the decisions.”* Involve key stakeholders in the process of building the case for change. By including their insights and perspectives, you can increase their investment in the transformation and minimize resistance. --- [5 tips for CFOs to accomplish finance digital transformationAs the CFO, you’ll lead the charge for finance digital transformation within the organization. But doing so takes some work. Here are 5 ways CFOs can drive finance digital transformation, optimize business processes, and even enhance overall profitability.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/finance-digital-transformation.jpg)](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) --- ## **5 strategies for successful change management during finance transformation** To effectively manage resistance and drive positive change within the organization, CFOs must adopt a strategic approach that considers the needs of stakeholders and the business. So, here are some of the best [change management](https://www.financealliance.io/3-principles-to-lead-with-confidence-through-change/) strategies to help you ensure the success of your finance transformation: ### 1\. Make communication your top priority Developing a clear and effective communication strategy that takes the needs and concerns of all stakeholders into consideration is so important. So, make sure to involve the right people early in the change management process as this will help build buy-in and reduce overall resistance. It’s also vital to keep stakeholders informed about the status of the finance transformation and always be open to their feedback. ### 2\. Provide sufficient training and development Providing training and development opportunities to help your team learn how to use new processes, technology, and/or systems is vital to the overall success of the transformation. When we asked finance professionals to rate their confidence in their ability to adapt to new technologies as part of our [State of Finance Transformation Report](https://www.financealliance.io/state-of-finance-transformation-report-2022/), 51.9% of respondents said they were between 81% to 100% confident. On the other hand, 29.6% of respondents stating they were slightly less confident, rating their ability to adapt to new technologies as somewhere between 61% to 80%. ![Change management strategies - findings from the state of finance transformation report on the confidence of using new technologies](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Change-management-strategy-ideas.png) These insights tell us that finance professionals absolutely need sufficient training and development to help them adapt to change. So, make sure that you’ve provided both, and don’t expect everyone to just ‘get it’ straight off the bat. ### 3\. Lead by example According to our [finance transformation survey](https://www.financealliance.io/state-of-finance-transformation-report-2022/), 74.1% of respondents said that strong leadership is very important when delivering transformation successfully. Unfortunately, not everyone received the level of support from their leadership that they required to succeed. In fact, 33.3% rated their level of leadership support as just average and a total of 44.6% said they were unsatisfied or very unsatisfied. ![Statistics from our State of Finance Transformation Report on leadership satisfaction](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/finance-transformation-change-management-.png) As a CFO, you must lead by example and demonstrate a positive attitude toward change. Your actions and attitudes will set the tone for the rest of the organization. Remember to set a positive example, demonstrate empathy, and encourage open and honest communication. ### 4\. Engage your team and offer incentives Offering incentives and recognition can be an effective way to manage resistance and promote positive attitudes toward change. This could include bonuses, promotions, or public recognition. It’s also worth making a conscious effort to engage the finance team in the change process and involve them in decision-making to increase buy-in and reduce resistance. ### 5\. Evaluate and adjust One of the most important change management strategies comes into effect after the initial financial transformation has occurred. Once new technologies are implemented, you’ve got to evaluate the progress of the finance transformation and adjust as needed. This will help ensure that the transformation stays on track and that resistance is managed effectively. ## Change management quotes: Tips from finance leaders Finance transformation impacts more than just an organization’s processes and systems, it also impacts the *team*. When plans for transformation fall apart, it’s often not because of the new technologies that were introduced, but because of the ways those changes were implemented. Therefore, you must build an effective culture of change to help manage resistance and deliver change successfully.... but how? Here are some change management quotes, including tips from respondents of our survey to help manage resistance and deliver change effectively: > *“Change is inevitable and for the greater good. As a CFO, you must make continuous dialogue with teams to come up with ideas for digitalization, process automation, and risk control measures, etc., along with the benefits of adopting these changes. Engage the momentum by using the ‘‘walk the talk’ approach in implementing discussed changes and provide needful support to the team in adverse situations.” – anonymous respondent of the State of Finance Transformation Survey* --- > *“CFOs must lead this strategic imperative. Most employee surveys complain of inefficient processes and competing priorities. Finance transformation can address this and improve morale and support retention.* > *CFOs have the power to allocate resources to make this happen. A dedicated, expert team is key.” – anonymous respondent of the State of Finance Transformation Survey* --- > *“Change is difficult to implement because, inherently, human beings find it more comfortable not to change. We like control and change brings with it uncertainty which we don’t like.* > *“Finance teams often struggle with change as they try to tell people what is needed from the perspective of finance or what is “right”, and do not spend a lot of time answering the question the other person who is being impacted by the change is asking themselves....what’s in it for me? - *Andrew Jepson, Partner (APAC) at The Finance Business Partner** --- > *“Showing the benefits that this transformation will bring to everyone, encouraging employees to specialize (which will develop their career), and proposing a growth perspective to employees who adhere to the changes.” - *Paula Mota, FP&A Analyst at BRZ Insurance** --- > *a) Identify your key stakeholders* > *b) Identify their needs and requirements* > *c) Engage their “head, heart, and hands”* > *d) Track and measure progress* > *e) Have well-planned, consistent communications that go both ways - *Brian Kalish, Principal, and Founder at Kalish Consulting** --- In conclusion, managing resistance to finance transformation requires a strategic approach that considers the needs of stakeholders and the business as a whole. By following these strategies, CFOs can effectively manage resistance and drive change, ensuring the success of finance transformations. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/01/FA_State_of_Finance_Transformation_Report_2022_CTA.jpg) ](https://www.financealliance.io/state-of-finance-transformation-report-2022/) ### Finance Alliance Salary Report 2023 URL: https://www.financealliance.io/finance-salary-report-2023/ Last updated: 2024-07-19T13:04:15.000Z \=Uncover the truth about what your finance peers are earning and see how your salary measures up with the **Finance Alliance Salary Report 2023**! 💵 ## What to expect in this report We’ve put a series of questions to our alliance of finance professionals to deduce: - The average **baseline** **salary** by region. - How salaries vary depending on your **role and seniority**. - Whether there is a discrepancy in pay between **genders**. …and so much more. ## What’s in it for you? Whether you need to recruit and retain top talent or you’re planning your next big career move, our report breaks down **global salary data** for a variety of finance roles. But that’s not all, our salary report will help you: 🌎 Learn how much your peers are earning in **different regions**. 🪜 Verify your **earning** **potential** as you climb the career ladder. 💰 Find out the average salaries for the most **in-demand finance roles**. 💸 Help negotiate your next **salary**, **pay** **raise**, or **promotion** with confidence. 🔮 Gain insights to help you **recruit and** **retain** **top** **talent** for your organization. ### What are you waiting for? Get your hands on the Finance Alliance Salary Report 2023 below. 👇 ### 3 cash flow forecasting challenges and how to navigate them URL: https://www.financealliance.io/3-cash-flow-forecasting-challenges/ Last updated: 2024-09-18T08:07:24.000Z How many times have you heard the saying; cash is king? Probably too many times to count. Yet, it keeps coming back up again and again because it’s *true*. Cash really *is* king and it’s the lifeblood of a business, which is why you’ve got to keep track of it. But we know that forecasting cash flow can be a challenging task, especially for small businesses and startups. There are a lot of variables to consider, and it can be tricky to predict the future with any degree of accuracy. In this post, we dive into the most common cash flow forecasting challenges, along with tips to overcome them. **Topics covered:** - [What is cash flow forecasting?](https://www.financealliance.io/p/974ba7f9-9f31-4688-a45c-27723f42a125/#what-is-cash-flow-forecasting) - [Cash flow forecasting challenges](https://www.financealliance.io/p/974ba7f9-9f31-4688-a45c-27723f42a125/#cash-flow-forecasting-challenges) - [7 tips to improve your cash flow forecasting process](https://www.financealliance.io/p/974ba7f9-9f31-4688-a45c-27723f42a125/#7-tips-to-improve-your-cash-flow-forecasting-process) ## **What is cash flow forecasting?** [Cash flow forecasting](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) is the process of estimating the amount of cash that a business will receive and spend in the future. This can be done for a specific period of time, such as a month or a year, or on an ongoing basis. Think of it like a GPS for business, helping you navigate through the ups and downs of the road ahead. It’s a powerful tool that supplies you with the data and insights needed to make better business decisions and achieve the company’s financial goals. Predicting money inflow and outflow is important for businesses because it allows them to plan for expenses, make informed decisions about investments, and identify potential cash flow shortages that may require financing. ![cash flow managemet challenges - maze with a red marker running through it](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/cash-flow-management-challenges.jpg) ## **Cash flow forecasting challenges** Cash flow forecasting is a continuous process, and it's normal to face challenges along the way. However, with some effort and determination, you can overcome these obstacles and improve your forecasting skills over time. But for now, here are three of the most common cash flow forecasting challenges to avoid: ### 1\. Manual work leading to errors According to[ Forbes](https://www.forbes.com/sites/salesforce/2014/09/13/sorry-spreadsheet-errors/?sh=50cfa5ce56ab), almost 9 out of 10 spreadsheets (88%) contain errors. Worse still, most of those errors are made by humans. If you think about it, it isn’t *that* surprising considering how much data entry many finance professionals carry out daily. But why are these human errors so common? Well, one of the main causes is a lack of proper training in the software and its capabilities, which can lead to mistakes such as: - Using the wrong formulas or functions - Inputting incorrect data - Omitting important information - Not following proper formatting - Not using proper controls With the complexity of financial spreadsheets, it's easy to overlook small errors that can have a *big* impact on outcomes. Therefore, it's crucial to have a system of checks and balances in place and to regularly review and audit spreadsheets. Better yet, you could leave manual data entry in the past and move to new technologies to help automate repetitive tasks and minimize errors. --- [What is cash flow-based financial planning? | Finance AllianceFinancial planning is vital for organizations that want to cement their success and ensure their future is a bright one. Many argue that cash flow based financial planning is the most effective way to plan and manage resources by focusing on the amount of cash coming in and going out of a business.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/cash-flow-based-finanical-planning.jpg)](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/) --- ### 2\. Not updating forecasts regularly Once you've created a cash flow forecast, it can be easy to let it collect dust. However, it's important to regularly review and update your forecast to make sure it stays accurate and relevant. After all, market conditions, business operations, and financial performance can all change quickly and unexpectedly. An outdated cash flow forecast won’t reflect these changes, which can land you (as the person or team responsible for forecasts) in a heap of trouble. Regularly updating the forecast lets you anticipate and plan for changes in revenue, expenses, and other financial transactions. ### 3\. Struggling to juggle data in multiple sources One of the most common cash flow forecasting challenges is when the data you need to complete your job is dispersed across multiple sources and systems. There’s nothing more frustrating than having to go and locate all that data. Aside from being incredibly time-consuming, collecting data from various sources across the company can lead to inaccuracies and inconsistent data. A possible solution is to use a centralized system for data management. This can be software or a database that allows you to collect, store, and analyze data from multiple sources in one place. Centralized data management systems can help you standardize and automate data collection, as well as improve data accuracy. You can also try out some of the more advanced features that often come with centralized data management systems. Some of these include things like [data visualization](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/), reporting, and collaboration tools, which can help you make sense of the data and share it with others. A centralized data management system is a great way to streamline your data collection and management process and make your life a little bit easier. --- [7 Benefits of a cash flow forecast to drive business growthUnderstanding the role the cash flow forecast plays in your finances is so important, which is why we’re sharing the top cash flow forecast benefits to help drive sustainable business growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/benefits-of-a-cash-flow-forecast.jpg)](https://www.financealliance.io/7-benefits-of-a-cash-flow-forecast-to-drive-sustainable-business-growth/) --- ## **7 tips to improve your cash flow forecasting process** Forecasting is an essential tool for managing the finances of any business. However, it can also be a difficult task. But by understanding the common challenges of cash flow forecasting and how to overcome them, you can start taking the right steps to make more accurate predictions. Here are a few tips to help you do just that: ### 1\. Use accurate and reliable data The quality of your forecast depends on the accuracy and reliability of the data you use. So, make sure to use data from all relevant sources, such as financial statements, invoices, and bank statements, and validate the data for completeness and accuracy. ### 2\. Use a consistent and comprehensive forecasting model A consistent and comprehensive forecasting model ensures your forecast is accurate. Not to mention, it'll also let you make meaningful comparisons between different periods. ### 3\. Incorporate a range of scenarios Include a range of scenarios in your forecast, such as best-case, most likely, and worst-case scenarios. This will give you a more complete picture of the potential outcomes and allow you to plan for a range of possibilities. ### 4\. Regularly review and update your forecast Your cash flow forecast is a living document and should be regularly reviewed (once per month, for example) and updated to reflect changes in the business environment. ### 5\. Communicate with other departments Collaborate with other departments, such as sales, operations, and marketing, to understand their plans and how they might impact the cash flow forecast. ### 6\. Use technology to automate and streamline the process Automating the forecasting process can help reduce errors and improve accuracy. ### 7\. Continuously learn and improve The markets are constantly changing, so it's essential to stay current with the latest forecasting techniques, best practices, and trends, and continuously improve and adapt your process. --- ## **Enrol in our Budgeting & Forecasting: Certified course** Take your financial planning to the next level with **"**[**Budgeting & Forecasting: Certified**](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters)**"** and learn directly from FP&A expert **Christian Wattig**, whose extensive experience spans multinational corporations and fast-growing startups. Through this course, you’ll gain a comprehensive understanding of the five phases of budgeting and develop the forecasting techniques that drive better business outcomes. Whether you’re refining your budgeting approach or learning how to forecast with greater accuracy, this course equips you with practical tools to make informed financial decisions. [Find out more](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### How FP&A evolves & fits within a scalable growth strategy URL: https://www.financealliance.io/podcast/scalable-growth-strategy/ Last updated: 2025-04-07T10:14:27.000Z As small businesses scale, the role of financial planning and analysis (FP&A) evolves and becomes increasingly important. But where exactly does FP&A fit within a scalable growth strategy? In this post, we're sharing insights from a recent episode of the [Two Cents: Finance Talk podcast](https://www.financealliance.io/podcast-two-cents-finance-talk/?wchannelid=id4lbj7w42&wmediaid=xxk4jjo6il), where we sat down with [Jeffrey Mazza](https://www.linkedin.com/in/jeffreymazza/), CFO in the BizOps group at CliftonLarsonAllen. In the episode, we explored how FP&A evolves and fits within a scalable growth strategy. Jeffrey shared his expertise on the subject, revealing practical insights on how small businesses can use FP&A as part of a scalable business model. So, whether you're a seasoned CFO or just starting to dive into the world of finance, this one is for you! Listen to the full episode below: Or keep reading to see what Jeffrey has to say about FP&A and scalable growth. **Topics covered:** - [Where FP&A fits within a scalable business model](https://www.financealliance.io/p/7b664b6d-6f8f-40c5-bc4e-6864838dd1e3/#q-where-does-fpa-fit-within-a-scalable-growth-strategy-or-business-model) - [How small businesses use FP&A to help them scale](https://www.financealliance.io/p/7b664b6d-6f8f-40c5-bc4e-6864838dd1e3/#q-how-can-small-businesses-use-fpa-to-help-them-scale) - [How the FP&A function evolves as the business grows](https://www.financealliance.io/p/7b664b6d-6f8f-40c5-bc4e-6864838dd1e3/#q-how-does-the-fpa-function-change-or-evolve-as-the-business-grows) - [How the way in which companies use FP&A has changed since Covid-19](https://www.financealliance.io/p/7b664b6d-6f8f-40c5-bc4e-6864838dd1e3/#q-since-covid-19-do-you-think-that-how-companies-use-fpa-has-changed) - [Key traits and skills of a successful FP&A team](https://www.financealliance.io/p/7b664b6d-6f8f-40c5-bc4e-6864838dd1e3/#q-what-are-some-of-the-key-traits-and-skills-of-a-successful-fpa-team) - [Tips for FP&A teams to help drive business growth](https://www.financealliance.io/p/7b664b6d-6f8f-40c5-bc4e-6864838dd1e3/#q-do-you-have-any-tips-or-advice-for-fpa-teams-to-help-drive-business-growth) ## Q. Where does FP&A fit within a scalable growth strategy or business model? I believe that it's front and center and that’s the way it should be. [FP&A](https://www.financealliance.io/your-ultimate-guide-to-fp-a/) has changed over the years and maybe I would’ve given a different answer 10 or 15 years ago. But FP&A has grown, and I think there's been a lot of education around what FP&A is in general. When you look at what FP&A can do, both internally and externally, it’s powerful. As the business grows and scales, it becomes even more important to not only utilize FP&A but develop good teams around it to interpret data to help the business scale and grow. ## **Q. How can small businesses use FP&A to help them scale?** A lot of our clients, especially the smaller business, might not know what FP&A is. But once you start to dive into it, their eyes light up and it's so powerful because you can use this both internally and externally. > "What I mean by that is, when you’re looking at your own current scalable processes within a company and provide the analysis, you’ll find critical drivers that help identify even little decisions that have *big* impacts." Externally, FP&A helps navigate where a company is going. It puts a financial plan in place to be able to achieve growth goals. And, there's a lot of uncertainty in this current environment, and being able to help navigate through rough waters is very critical nowadays. --- [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) --- ## Q. How does the FP&A function change or evolve as the business grows? This can start off very simple for small businesses, but as FP&A grows, your business grows. I believe that the FP&A function should be able to adapt to that. And, that could involve building out additional teams, but even as you grow, there starts to be a lot more analysis that might take place. For example, if a company is looking to 5x the top and bottom line over the next few years, it sounds like pretty aggressive growth goals and what does that even look like? Can your production facility even process the number of units that might be coming through there? It might lead to performing a deep dive on an analysis of your own current internal processes, as well as production to see if you can even handle that growth. And you might make some decisions based on the analysis such as obtaining another facility, or more staff to help identify what the business needs. However, you can also look at FP&A as your business grows and ask how we can be more efficient to be able to achieve that growth. From there, you can look at the current processes, and start to make some tweaks along the way. Then, as you grow, you're going to need some sort of technology, because the technology today is very powerful, and can adapt rapidly. --- [Two Cents: Finance TalkLearn how to navigate your way to the C-Suite and excel within your role with help from the Two Cents podcast. Each episode features exclusive interviews with CFOs and industry experts - all sharing their two cents on everything finance.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/meta-generic-image-1.jpg)](https://www.financealliance.io/podcast-two-cents-finance-talk/?wchannelid=id4lbj7w42&wmediaid=zwduy4z1wb) --- ## **Q. Since COVID-19, do you think that how companies use FP&A has changed?** COVID-19 really affected the entire global landscape. It wasn't just directed to one area. So that meant, at least for me, having conversations with fellow financial executives, and realizing that no one was really planning for something like this. After all, how can you plan for a global pandemic to disrupt the global economy? But everyone kind of shifted and had to consider things on a much deeper level. When the lockdown happened, we needed to know how much cash we had. Those are some of the discussions that other businesses were having. And as I mentioned, you can't really plan for that. I think the pandemic really opened the eyes of business owners to say, “*what if?*” What if one of these scenarios comes around, again, do we have options to handle it? Should another pandemic happen, I feel like people are aware of the real downside of that now. > "It really opened our eyes to better planning and making sure that the business can navigate through rough waters." In my opinion, the way that FP&A has changed since the pandemic is that it’s really accelerated a lot of businesses to be more open and adapting to not only having FP&A as part of their business, but making it way more robust to be able to help navigate through some of these rough waters that could be around the corner. ## **Q. What are some of the key traits and skills of a successful FP&A team?** Good FP&A teams have evolved over the years, and you're starting to see more and more focus on FP&A from businesses and people are very interested in that. To me, a [skilled FP&A team](https://www.financealliance.io/top-10-fp-a-skills-to-master/) is about development as well as looking for that talent that's beyond the core finance capabilities. > "Bringing a good FP&A team together that can think *outside* the box is important, but it takes more than that. Your team really needs to understand the business, the industry, and how the FP&A team can help identify efficiencies of processes and offer better recommendations using that data to really elevate the FP&A team." --- [7 Benefits of a cash flow forecast to drive business growthUnderstanding the role the cash flow forecast plays in your finances is so important, which is why we’re sharing the top cash flow forecast benefits to help drive sustainable business growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/benefits-of-a-cash-flow-forecast.jpg)](https://www.financealliance.io/7-benefits-of-a-cash-flow-forecast-to-drive-sustainable-business-growth/) --- ## **Q. Do you have any tips or advice for FP&A teams to help drive business growth?** I look at it as three areas you need to prioritize: ### 1\. Internal You need to look at the internal processes that you can prove helps [drive performance](https://www.financealliance.io/how-fp-a-teams-can-drive-real-growth-in-2023-q-a-with-christian-wattig/). Not only that but evaluate any existing processes that really identify the critical drivers and performance of the company and analyze them. Are there any efficiencies that can take place? And that's using FP&A to help with the analysis of those processes. Also, consider if there's any automation and if there are any areas in that you can make small tweaks to have big impacts. ### 2\. Technology The technology that’s out there today is powerful. We went from just moving a lot of manual processes. For example, think about the budgeting process. Everyone's used to Excel sheets with lots of going back and forth, which leaves room for human error. Recently, we have had more options such as AP automation and RPA. Now, we have AI and that's even a step further than RPA. It’s remarkable that with this type of technology, you can access even deeper insights. Using AI and ML, you can identify trends that the human eye can’t always see and it's powerful. More importantly, you can use that technology to utilize efficiencies and speed. Nowadays, people want their data in real-time to be able to make better-informed decisions based more on data and less on intuition. ### 3\. Teams The final piece is developing your core team, which will require some training. But finding that talent that’s beyond the core finance capabilities is so important. > "You need to build a team that really understands the business, the industry, and the drivers that affect the business itself." And even when a scalable growth strategy is in place, you still need to include solid financial plans to go along with the business growth goals. ![Scalable growth strategy - Two Cents podcast with Jeffrey Mazza](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/Jeff-podcast-logo.png) ### About Jeffrey Mazza [Jeffrey Mazza](https://www.linkedin.com/in/jeffreymazza/) is the Greater Chicagoland Office Leader and CFO in the BizOps group at CliftonLarsonAllen. CLA creates opportunities for businesses, individuals, and communities through our wealth advisory, outsourcing, audit, tax, and consulting services. Jeffrey brings with him over 20+ years of experience in senior financial and operational leadership roles. He has a measurable history of helping businesses succeed by designing and executing growth strategies and capitalizing on opportunities to accelerate profitability through effective financial planning and analysis. He also brings extensive experience in developing both financial and operational infrastructure in early-stage companies. Jeffrey serves as a steering committee member at The CFO Leadership Council, a member of the Association of Certified Fraud Examiners, and the CFOrward Group. He is also an active volunteer and a board member of The GALF LLC. He earned a bachelor’s degree in finance from the University of Massachusetts, Amherst, and attended the MBA program at DePaul University Charles H. Kellstadt Graduate School of Business. Jeffrey also holds the CFE (Certified Fraud Examiners) designation. ### What is financial planning and analysis (FP&A) URL: https://www.financealliance.io/your-ultimate-guide-to-fp-a/ Last updated: 2026-03-11T11:45:42.000Z Welcome to the complete guide to financial planning and analysis (FP&A), covering everything you need to know to become a pro at one of the most sought-after roles in finance. FP&A is almost always the main driving force behind all major business decisions or, at least, it *should* be. It’s a critical part of any organization, helping leaders make informed choices about the future of the company. With the right[ FP&A](https://www.financealliance.io/tag/fp-a/) strategies in place, you can identify and manage risks, seize opportunities, and drive growth. And that's exactly what we'll cover in this comprehensive guide. **In this guide, we cover:** - [What is financial planning and analysis (FP&A)?](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#what-is-fpa) - [Why do businesses need FP&A?](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#why-do-businesses-need-fpa) - [Benefits](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#benefits-of-financial-planning-and-analysis) - [The difference between FP&A and accounting](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#fpa-vs-accounting-what%E2%80%99s-the-difference) - [What do FP&A teams do?](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#what-do-fpa-teams-do) - [Responsibilities](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#fpa-responsibilities) - [Job roles](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#fpa-roles) - [Important FP&A skills](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#fpa-skills) - [How to build an FP&A function](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#how-to-build-an-fpa-function) - [Technology and automation](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#technology-and-automation-in-fpa) - [What’s next for FP&A?](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#what%E2%80%99s-next-for-fpa) ## **What is FP&A?** Picture this – you're the CEO of a business, and you need to make a decision that will impact your bottom line. But you can't just go with your gut, you need hard data to back up your choice. That's where FP&A comes in. FP&A professionals dig into the numbers and use their expertise to paint a picture of a company's financial future. They use budgets, financial models, and data analysis to give decision-makers the information they need to make informed decisions. In short, FP&A is a way for companies to stay ahead of the game financially. By using data and smart forecasting, businesses can plan for the future, remain financially healthy, and achieve their goals. So, what is FP&A in finance? Simply put, it's a critical tool for making smart financial decisions in today's fast-paced business world. ## **Why do businesses need FP&A?** An effective financial planning and analysis function is the cornerstone of any successful organization, providing a critical lens into the financial health of a company. It's not just about number crunching and spreadsheets, it's about helping organizations make informed decisions that drive growth, optimize resources, and mitigate risk. Think of it like this – if you're driving cross-country, you don't just hit the gas and hope for the best. You map out your route, plan for pit stops, and factor in unexpected roadblocks. The same is true for a business – you need a plan to reach your destination, and that's where FP&A comes in. By using data and smart forecasting, FP&A gives companies a clear view of their financial situation (past, present, and future). --- [How FP&A teams can drive real growth in 2023 | Q&A with Christian WattigChristian Wattig, Managing Director at FP&A Prep, recently answered the Finance Alliance Slack Community’s burning questions about how to best prepare for 2023.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/fp-a-teams-success-2023.jpg)](https://www.financealliance.io/how-fp-a-teams-can-drive-real-growth-in-2023-q-a-with-christian-wattig/) --- ## **Benefits of financial planning and analysis** FP&A is a critical tool for any business that wants to remain financially healthy and make data-driven decisions that impact the bottom line. But what are the main benefits? There are many, but some of the most important include: - Data-driven decision making - Financial foresight and heightened financial visibility - Increased accountability and transparency - Better resource allocation - Improved risk management - Better cash flow management ## **FP&A Vs accounting: What’s the difference?** You’d be surprised at just how many people confuse these two areas of finance. While both involve working with financial data, there are key differences between them. First and foremost, let's start with accounting. Accounting is all about tracking and reporting a company's financial performance. Accountants use data to create financial statements, balance sheets, and income statements, which provide a snapshot of a company's financial situation at a specific point in time. On the other hand, FP&A is all about using data and smart forecasting to make informed decisions for a company. Unlike accounting, which provides a static view of a company's financial situation, FP&A focuses on creating a guide for a company's future. The main differences between FP&A and accounting are their focus and purpose. While accounting focuses on maintaining accurate records and compliance with financial regulations, FP&A leans on financial data to drive business strategy and decision-making. --- [How to transform your team into finance business partnersFinance teams are more than just number crunchers. To become a finance business partner, you must create value by providing insights that help business leaders make data-driven decisions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Schöler![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/finance-business-partners-header-image.jpg)](https://www.financealliance.io/number-crunchers-finance-business-partners/) --- ## **What do FP&A teams do?** FP&A teams serve as financial problem-solvers, providing critical insights and recommendations to drive business success. But what do FP&A teams do? A lot of things, as it turns out. From data collection to creating detailed financial reports, budgeting, forecasting, scenario planning, and more, FP&A professionals have a lot on their plate, such as: - [Forecasting](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#forecasting) - [Financial modeling](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#financial-modeling) - [Strategic financial planning](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#strategic-financial-planning) - [Budgeting](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#budgeting) - [Performance reporting](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#performance-reporting) - [Scenario planning](https://www.financealliance.io/p/0f9b749a-c6ad-4b6d-9053-feee56740dcc/#scenario-planning) - [Risk management and stress testing](https://www.financealliance.io/your-ultimate-guide-to-fp-a/#risk-management-and-stress-testing) - [Ad hoc financial reporting](https://www.financealliance.io/your-ultimate-guide-to-fp-a/#ad-hoc-financial-reporting) ![FP&A - What is FP&A in finance? - image of the process from plan to success](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/What-is-fp-a-.png) ## **FP&A responsibilities** Let’s take a closer look at some of the most important FP&A roles and responsibilities: ### Forecasting [Financial forecasting](https://www.financealliance.io/podcast/financial-forecast-model/) is a key responsibility of the FP&A team. The main goal of forecasting is to establish what the future holds concerning the financial performance of the company. With those valuable insights, management is in a much better place to make informed decisions so they can prepare for the future. Unlike weather reporters, FP&A professionals don’t use a green screen to forecast a company’s finances. Instead, they rely on historical data and assumptions about future events and trends to make accurate projections. This helps companies plan for what’s to come, identify potential risks, and make informed decisions that impact the bottom line. Forecasting is carried out by first collecting and analyzing data on the company’s historical financial performance, market trends, and economic conditions. All of this information is then used to create projections of the future financial performance of the company, often covering aspects such as revenue, expenses, and cash flow. --- [How to create a simple financial forecast modelFinancial forecasting predicts the future performance of the business. But how can you build a financial forecast model from the ground up? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/financial-forecast-model.jpg)](https://www.financealliance.io/podcast/financial-forecast-model/) --- ### Financial modeling Financial modeling is the process of creating an abstract representation of a company's financial situation and using that model to help understand how different scenarios might impact the bottom line. FP&A uses a variety of software programs and tools to create financial models, including spreadsheets, databases, and specialized modeling software. Think of it like a crystal ball into the future, but instead of magic, it's all about data and trends. The creation of a [financial model](https://www.financealliance.io/build-a-saas-financial-model/) starts by determining what the company’s key financial drivers are. Once you have those pinned down, it’s time to work on the model and make sure it reflects the relationships between these drivers and the organization's financial results. You can then use the model to test multiple scenarios (via scenario planning, which we get into in more detail below), to establish the potential impact of different decisions on the organization. --- [How to build a basic SaaS business financial modelWhether you’re launching a SaaS start-up, or your existing financial model needs some much-needed TLC, building the best financial model for your SaaS company doesn’t have to be difficult. In this article, we’ll cover how to build a SaaS financial model![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/SaaS-financial-model.jpg)](https://www.financealliance.io/build-a-saas-financial-model/) --- ### Strategic financial planning Financial planning helps align a company's financial goals with its overall strategic objectives. It also provides a clear blueprint for decision-making and helps ensure that the company's financial resources are aligned with its goals. Keep in mind that strategic financial planning is not just about crunching numbers. It's about understanding the business, making informed decisions, and taking a proactive approach to achieving financial success. It's all about being in control of the organization's financial future and making sure that it has the resources it needs to achieve its goals and stay competitive. --- [Why value proposition budgeting is key to boosting revenueIs value proposition budgeting right for your business? It could be, but before you jump in headfirst and shake up your entire budgeting process, let’s take a moment to understand how this form of budgeting impacts the bottom line.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/what-is-value-proposition-budgeting-.jpg)](https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/) --- ### Budgeting Budgeting involves planning and managing the company's financial resources, tracking the performance of initiatives against pre-set targets, and making informed decisions to drive business success. The [budgeting process](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) is a collaborative effort between FP&A, the finance team, and each department within the business. Each team provides input into the budget, including their plans for achieving their goals and the resources they’ll need to make it happen. FP&A then takes this information and uses it to create a comprehensive budget for the entire organization. Once the budget is finalized, FP&A is responsible for monitoring the actual results against the budget and adjusting as needed. --- [How to create a digital reporting shortcut in 3 easy stepsHow can you as the CFO (and/or your finance team members) create a financial report that’s truly time-efficient? In this post, I reveal 3 easy steps to create a digital reporting shortcut for busy CFOs and their finance teams.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceDaniel Echeverri![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/lukas-blazek-mcSDtbWXUZU-unsplash.jpg)](https://www.financealliance.io/digital-reporting-shortcut/) --- ### Performance reporting FP&A teams rely on performance reporting to track a company's financial performance and communicate it to stakeholders. It’s also used to track key metrics such as revenue, expenses,[ cash flow](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/), etc. The process starts with collecting and analyzing financial data, such as actual results, budgets, and forecasts. Armed with this information, they can then create reports that provide valuable insights like variances between actual results and budgets, trends, and areas for improvement. These reports are usually shared with executives and senior management, the rest of the finance team, and other key stakeholders within the company. FP&A is also expected to present information in a clear, concise, and meaningful way, often using data visualization techniques to tell a compelling story that non-finance professionals can understand. ### Scenario planning [Scenario planning](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) is a key tool used by FP&A teams to help businesses prepare for and respond to potential future events. We live in an uncertain world after all, and organizations need to be ready for whatever comes their way. The scenario planning process begins by identifying the key drivers of the organization's financial performance and the factors that could impact those drivers in the future. The team then uses this information to create multiple scenarios, each with different assumptions about how the key drivers will perform. The reasoning behind scenario planning is to provide management with a range of possible outcomes so that they can make informed decisions about how to respond to different financial scenarios in real time should any of those events happen. Scenarios are created using a combination of data analysis, expert judgment, and intuition. While the process of building multiple scenarios can be time-consuming, it’s important because it helps organizations anticipate change and prepare for the future. --- [How scenario planning can prepare your business for anythingReducing risk and building awareness of what could happen can help you prepare for almost anything. But how does strategic scenario planning work? And how can finance teams use it to future-proof the business? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/firmbee-com-jrh5lAq-mIs-unsplash-2.jpg)](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) --- ### Risk management and stress testing Risk management and stress testing are key components of the FP&A process, used to help businesses identify and mitigate financial risks and ensure the company's financial stability. Managing risk is all about identifying, assessing, and prioritizing financial risks to the company. Once you’re clear on that, it’s up to you to come up with the steps to help mitigate those risks. To do this, FP&A teams often develop contingency plans and will allocate resources to manage any risks that arise in an attempt to reduce their impact on the company. Stress testing is a form of risk management that involves simulating potential adverse events to understand the potential impact on the company's financial performance. ### Ad-hoc financial reporting Sometimes, companies need FP&A to perform financial reporting out of the blue. This is referred to as ‘ad hoc financial reporting’ and means that financial reporting needs to be created on an as-needed basis. Whilst it’s not everyone’s favorite approach to FP&A, ad-hoc financial reporting is extremely important because it provides the company with timely, relevant, and accurate financial data when they need it. --- [Infographic | 10 FP&A best practices 2023 | Finance AllianceThe best-run finance functions have mastered the art of FP&A. They’ve proved that when done right, FP&A doesn’t just predict business outcomes, it can drive them too. Here, you’ll find our infographic detailing the top FP&A best practices of 2023.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/FP-A-BEST-PRACTICES-2.jpg)](https://www.financealliance.io/infographic-10-fp-a-best-practices/) --- ## **FP&A roles** There are a variety of different job titles within FP&A that focus on different aspects of financial planning and analysis. Some job titles and roles may vary by company, but here are some of the most common roles in FP&A: ### Chief Financial Officer (CFO) As key executives within a company, CFOs often play a critical role in FP&A because it helps them make informed decisions about the organization's future financial performance. Not to mention, they also rely on insights from FP&A to help oversee financial operations and provide financial guidance to senior management. ### Director of FP&A/Vice President of FP&A Say hello to one of the most important players in the FP&A world! A Director of FP&A or VP of FP&A is a senior-level executive who leads the FP&A function within an organization. They’re responsible for ensuring that the company’s FP&A processes are efficient, effective, and aligned with overall goals and objectives. They work closely with different teams and the CFO to develop and execute financial strategies. Without the Director of FP&A, an organization would struggle to make informed decisions about its finances, and it would be more difficult for senior management to understand the financial performance of the organization. --- [FP&A Manager: What does an FP&A Manager do? | Finance AllianceBut what does an FP&A Manager do? And what skills do you need to pursue a career in FP&A? In this article, you’ll learn what the main FP&A responsibilities, skills, and traits are to become a value-driven FP&A professional on the road to success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/FP-A-manager-blog.jpg)](https://www.financealliance.io/fp-a-manager-what-does-an-fp-a-manager-do/) --- ### FP&A Manager An[ FP&A Manager](https://www.financealliance.io/fp-a-manager-what-does-an-fp-a-manager-do/) oversees the day-to-day operations of the FP&A function. They often work closely with other departments to help gather financial data, create financial models, and provide insights and recommendations to senior management. Some of their daily tasks include evaluating and building budgets, creating financial models and forecasts, providing detailed analysis of the performance of different initiatives (such as a product), and communicating insights to executives. ### Financial Analyst / FP&A Analyst While you’ll often hear of different levels of seniority within the Financial Analyst role (such as Junior and Senior Analysts), many of the responsibilities remain similar regardless of seniority. Someone in this role is usually responsible for analyzing financial data, creating forecasting models, tracking revenue and gross margin, analyzing trends and forecasts, preparing reports, and so on. --- [Top 10 FP&A skills every finance professional must masterHere are the top 10 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/FP-A-Skills-2.jpg)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) --- ## **FP&A skills** What skills do you need in your arsenal to succeed in FP&A? Here are just a few: ### Attention to detail Spotting trends and inconsistencies in complex reports isn’t easy. A skilled FP&A professional can look at the[ bigger picture](https://www.financealliance.io/10-big-picture-financial-planning-steps/) and at the same time, zoom into the details to understand patterns and extract information from the data presented. ### A curious mind Having a curious mind and knowing the right questions to ask is so important for strategic planning and better decision-making. For example, a talented FP&A Manager isn’t afraid to ask executives what their biggest problem is and how they believe FP&A can help solve it. ### Business acumen You won’t get far in FP&A without understanding the business inside and out. This means taking the time to get familiar with the business model, goals, objectives, and strategy. The more you know about how the business works and what it wants, the better. ### Analytical skills Analyzing financial data and using the findings to make informed decisions is crucial for FP&A. This means you'll need analytical skills to be able to understand complex financial information, identify trends, and make recommendations based on that information. ### Communication FP&A teams aren’t siloed in the slightest. You’ll often be required to communicate complex financial information to a variety of stakeholders, including senior management, other departments, and external partners. Therefore, you must be an excellent communicator to articulate insights and recommendations to others. ### Data storytelling This one is connected to communication because it refers to the skill of communicating the meaning *behind* data using visuals such as graphs, tables, charts, and so on. Not only that but being able to [build a story using that data](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) to communicate business performance and drive decisions is extremely important. ### Tech-savvy You don’t need to be a pro at every new software and tool to hit the market. However, being a tech-savvy FP&A professional gives you a competitive edge because you’ll often have to learn new tools quickly and even teach others on the team how to use different technology. --- [3 ways FP&A can thrive amongst a field of skepticismIn this article, you’ll discover three ways an FP&A professional (or an FP&A team) can survive and thrive amongst a field of skepticism.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Page![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/FP-A-professional.jpg)](https://www.financealliance.io/3-ways-an-fp-a-professional-can-thrive-amongst-a-field-of-skepticism/) --- ## **How to build an FP&A Function** Building an FP&A function from scratch can seem like a daunting task, but it doesn't have to be. With the right approach, you can build a strong and effective FP&A function that’ll help your organization achieve its financial goals. Here are some of the steps to help you get started: ### Step 1: Define the goals and objectives of the FP&A function What does the organization want to achieve through FP&A? What kind of insights does it want to gain? Having clear goals and objectives will help you focus your efforts and ensure that the FP&A function is aligned with the organization's broader goals. ### Step 2: Assess the resources available What kind of budget do you have? What kind of technology and tools are available? What kind of talent is already in the organization? With a clear understanding of the resources available, it’ll be much easier to make informed decisions about how to build your FP&A function. ### Step 3: Develop a detailed plan Next, it’s time to come up with a detailed plan and make sure to include specific steps for setting it up, such as hiring and training new staff, implementing technology and tools, and establishing processes and procedures. ### Step 4: Build a strong team You need to hire experienced and talented professionals who have the skills and expertise required for the roles you must fill. Make sure you have a mix of skills and experience on the team, including financial modeling, data analysis, and project management. ### Step 5: Implement processes and procedures This includes developing and implementing financial forecasting and reporting processes, as well as establishing clear lines of communication between the FP&A function and other departments within the organization. ### Step 6: Continuously monitor and improve Finally, you need to continuously monitor and improve the FP&A function. This means regularly reviewing its performance and making changes as needed to improve its effectiveness. Just remember, building an FP&A function takes time, effort, and resources. So, be patient, stay focused, and don't be afraid to ask for help when you need it. --- [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) --- ## **Technology and automation in FP&A** Technology has made a huge impact on the finance industry, especially within FP&A. According to our[ State of Finance Transformation Report](https://www.financealliance.io/state-of-finance-transformation-report-2022/), 55.6% of respondents said that automation had the biggest positive impact on their FP&A processes above all else. Specifically helping to streamline processes, improve accuracy and speed, and provide a deeper level of insights that simply weren't as accessible as before. [AI](https://www.aiacceleratorinstitute.com/your-guide-to-artificial-intelligence/) is one of the biggest game-changers in FP&A right now. From predictive analytics to machine learning algorithms, AI is helping FP&A teams make better decisions, *faster*. For example, AI can automatically identify patterns and trends in financial data that might take a person hours or even days to spot. This means FP&A teams can make data-driven decisions in real-time, *without* sacrificing accuracy. But the [benefits of technology in FP&A](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) go beyond just speed and accuracy. For example, cloud-based software and tools have made it easier for finance teams to collaborate and share data with stakeholders across the organization. This has helped to improve communication, streamline workflows, and boost productivity. So, what kind of software and tools are finance teams using to stay ahead of the curve? There are a ton of options out there, but some of the most popular include: - **Budgeting and forecasting software**: This type of software helps FP&A teams create, monitor, and update budgets, as well as make more accurate forecasts. - **Financial reporting software**: These tools help teams create and distribute reports more quickly and easily while maintaining accuracy. - **Dashboarding and data visualization tools**: This type of technology helps teams turn raw financial data into easy-to-understand visualizations that make it easier to identify trends, spot opportunities, and make informed decisions. Whether you're looking to streamline processes, improve accuracy, or just work more efficiently, there's no denying the power of technology in FP&A. --- [Robotic Process Automation in Finance: 5 benefits of RPAIn this post, you’ll find out how to use RPA to streamline financial processes. We’re also sharing five amazing benefits of using automated RPA software.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/robotic-process-automation-in-finance-2.jpg)](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) --- ## **What’s next for FP&A?** The future of FP&A is all about two things: automation and data. As technology continues to evolve, finance teams will be able to automate more and more processes, freeing up time and resources to focus on higher-level tasks. This will lead to faster and more accurate decision-making, and help organizations stay ahead of the curve in an increasingly competitive business landscape. Another big trend we're likely to see in the future is a greater focus on data. FP&A teams will have access to an ever-growing pool of data, which of course, they’ll have to turn into actionable insights. To do so properly, FP&A will need to build its understanding of data science, machine learning, and other advanced technologies. So, it’ll be even more important to stay on top of these emerging [FP&A trends](https://www.financealliance.io/podcast/fintech-trends-2023-top-trends-future-predictions-for-fintech/). One thing that won't change is the importance of the human touch. While automation and technology will play a big role in the future of FP&A, finance professionals will still be needed to interpret the data and make informed decisions. This means that the role of the FP&A professional is likely to evolve as well, becoming more focused on strategy and less on the nitty-gritty details of data analysis. In conclusion, the future of FP&A is all about embracing technology and data, while maintaining a strong focus on human judgment and decision-making. As finance teams continue to automate processes, they'll be able to focus on the bigger picture and provide valuable insights to organizations across the board. The future of FP&A is looking bright, and we can't wait to see where it goes from here! --- ## Frequently asked questions (FAQs) What does an FP&A role do? An FP&A (Financial Planning & Analysis) role is responsible for financial planning, forecasting, and analysis to support the organization's overall strategic goals. Is FP&A accounting or finance? FP&A is a finance role. While accounting focuses on past financial transactions, FP&A focuses on forecasting and planning for future financial outcomes. Is FP&A same as financial analyst? Yes, FP&A is a type of financial analyst role. However, FP&A analysts typically have a broader range of responsibilities than other types of financial analysts. What is the hierarchy of FP&A? The hierarchy of FP&A typically includes roles such as Analyst, Senior Analyst, Manager, Senior Manager, Director, and Vice President. What qualification is needed for FP&A? Most FP&A roles require a bachelor's degree in finance, accounting, or a related field. Some employers may also require a master's degree or professional certification, such as the CFA (Chartered Financial Analyst) designation. What skillset is required for FP&A? Some of the key skills required for FP&A roles include financial analysis, budgeting, forecasting, data analysis, and communication skills. Strong Excel skills and knowledge of financial software such as ERP (Enterprise Resource Planning) systems are also often required. Is FP&A a good career path? Yes, FP&A can be a rewarding career path for those interested in finance and analysis. FP&A roles offer the opportunity to work closely with senior leadership and make strategic decisions that can have a significant impact on the organization's financial performance. How to get into FP&A without experience? While most FP&A roles require some previous experience, it is possible to get into the field without direct experience. One way to do this is to gain relevant skills and experience through internships or entry-level finance roles such as accounting or financial analysis. Do you need CFA for FP&A? No, a CFA (Chartered Financial Analyst) designation is not typically required for FP&A roles. However, some employers may prefer or require candidates with this certification, particularly for more senior or specialized roles. --- ### **Want to take your FP&A knowledge to the next level?** We host both in-person and virtual [FP&A Summits](https://events.financealliance.io/) for finance professionals looking to stay ahead of the curve and take their skills to the next level. This is a rare opportunity to network with some of the best minds in the industry, learn from leading experts and thought leaders, and get hands-on experience with the latest tools and technologies. Whether you're looking to improve your forecasting accuracy, streamline your workflows, or just stay up-to-date on the latest trends, an FP&A Summit is the place to be. So why wait? [Sign up for the next virtual or in-person FP&A Summit today](https://events.financealliance.io/)! ### 10 CFO personality traits to go down in history URL: https://www.financealliance.io/10-cfo-personality-traits/ Last updated: 2025-10-23T08:58:39.000Z What are the most important Chief Financial Officer (CFO) personality traits? And what type of person makes a good CFO? Below, we reveal the top 10 qualities of a good CFO to go down as one of the strongest finance leaders in history. ## **10 of the most important CFO personality traits** ### **1\. Excellent communicator** If you want to stand out as a CFO, you must be able to communicate complex data effectively. After all, you're the financial brain of the company. Stakeholders rely on you to paint a clear picture of the company's financial health. Even the most complicated data is easy to explain to non-finance people by a CFO with great communication skills. But how? The answer is simple – they tailor their message to their audience. Whether that's swapping 'finance lingo' for simpler terms or showcasing data with visuals instead of spreadsheets, successful CFOs are expert communicators. ### **2\. Strong leadership skills** Leadership is one of the most important CFO traits. As key members of the C-Suite, CFOs have *a lot* of eyes on them. Therefore, setting a good example and fostering a positive work culture is essential. There's no arguing that the most effective[ CFOs have strong leadership skills](https://www.financealliance.io/top-10-cfo-skills/). They anticipate future trends and challenges within their industry and back those insights with data to help make strategic business decisions. This level of vision and foresight is a key indicator of a great leader. ### 3\. A problem-solver A successful CFO identifies and solves problems in a timely and effective manner. They have a natural ability to see beyond the surface and dig deep to understand the root cause of the problem. The company’s financial performance drives every decision a CFO makes. This is especially important when deciphering financial data and coming up with strategic solutions to not only fix the immediate issue but also improve the company’s long-term financial performance. --- [CFO and CEO relationship: 5 ways a CFO can support the CEOIn this post, you’ll learn what a CEO needs from their CFO, and what you can do to support the CEO on a day-to-day basis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/handshake-g5cf73343d_1920-1.png)](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/) --- ### 4\. Detail-oriented Strong attention to detail is a must-have CFO personality trait because so much time is spent analyzing complex data. Paying close attention to details ensures the accuracy of financial reports. It also improves the chances of spotting and fixing errors or discrepancies. A detail-oriented CFO digs deep and leaves no stone unturned in their quest for accuracy. They’re prepared to go above and beyond to ensure that everything is correct because they know all too well that even the smallest error can have serious repercussions. ### 5\. High emotional intelligence If there was one CFO personality trait imperative for maintaining effective relationships and making sound decisions under pressure, it’s this one. Emotional intelligence (EI) is the ability to recognize, understand, and manage your emotions. It also involves understanding and responding to the feelings of others. If you can navigate and manage complex relationships, communicate effectively, and handle high-pressure situations with grace and poise, you’re well on your way to solidifying your place in the CFO hall of fame. ### 6\. A true visionary What does it mean to be a visionary? For CFOs, it means having a clear vision for the future and the ability to inspire and guide the finance team to achieve it. It’s one of the top qualities of a CFO because a visionary CFO sees beyond the numbers. With a deep understanding of the industry and the market, CFOs get a clear sense of where the company is, and where it should be heading. Then, they create a plan to help the company reach that destination. --- [Top 10 must-have Chief Financial Officer skillsThe modern CFO wears multiple hats and must master a variety of skills. But what skills does the CFO of the future need to stay on top? Here are the top 10 skill sets for CFOs of tomorrow.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/arrow-gb0e6f39dd_1920.jpg)](https://www.financealliance.io/top-10-cfo-skills/) --- ### 7\. Strategic thinker Successful CFOs are strategic thinkers. This means looking at the [big picture](https://www.financealliance.io/10-big-picture-financial-planning-steps/), understanding the company's goals, and developing a plan to achieve them. A strategic mindset allows CFOs to be more proactive in identifying potential issues and creating solutions. To do this, they must know how all areas of the business interconnect and be fully aware of the financial implications of their decisions. ### 8\. Demonstrates honesty and integrity Honesty and integrity help establish trust with team members and stakeholders. So, if you want to build a legacy as a great CFO, you must practice both in your role. Both traits are important because people tend to trust a CFO's judgment. And, they’ll trust a CFO who is open and honest in their communication and conduct that much more. Without the trust of your team, you’ll have a hard time convincing *anyone* to follow your lead. But what about integrity? Why is that one of the most important CFO qualities? Having integrity implies operating morally and ethically. A CFO with integrity makes difficult decisions with confidence, knowing that they are the right decisions, even if they may be unpopular. ### 9\. Strong people skills Being a CFO is not just about crunching numbers. Strong people skills help a CFO understand and address the needs and concerns of their teams. A good CFO with strong people skills is viewed as a leader who can guide the company toward success while also taking care of the employees. So, having strong people skills is not just a nice to have, it's a *must-have* for any successful CFO. ### 10\. Highly adaptable and flexible CFOs need to be able to roll with the punches and adapt to whatever the business world throws their way. Being adaptable and flexible makes navigating change that much easier. Not only that, but they're also required skills to have when it comes to making important financial decisions in a timely and effective manner. This is crucial for responding to changes in regulations or shifts in consumer demand. Having these qualities also helps CFOs capitalize on new opportunities, making them an asset to the company. The role of a CFO is critical to the success of any organization. By embodying these CFO personality traits, you can guide your company and team toward financial success and stability. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### The Financial Planning & Analysis Chasm URL: https://www.financealliance.io/the-financial-planning-analysis-chasm/ Last updated: 2024-06-19T08:38:30.000Z ## The Gartner Analytic Value Escalator (Perception) FP&A has, until recently, been considered a back/middle office function. However, a few recent trends have thrust FP&A into the spotlight: - Gartner’s Magic Quadrant recognition of [FP&A](https://www.financealliance.io/10-big-picture-financial-planning-steps/). - Broad adoption of FP&A as part of the go-to-market team’s competitive advantage. - “Business partnership” appears frequently in job posts. - Finance as an enablement function vs. a compliance or administrative function (ex. Deal Desk movement). - An explosion of financial data in both size (number of rows) and scope (number of data sources). - Financial data integration into R&D-owned production systems. - Popularization of Revenue Operations, and the VC-funded marketing engines of their products. ![The Financial Planning & Analysis Chasm](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/chasm-1.webp) Mysteriously, the in-house analytics have mostly remained focused on answering “what happened” and “why did it happen” (Descriptive & Diagnostic). For decades, consulting practices have focused on Predictive and Prescriptive analytics (ex. pricing equilibrium models). However, organizations are often unable to execute the top-down strategies and recommendations provided. With access to the underlying data sources required to perform deep analysis in-house, forward-thinking organizations attempt to apply consulting tools (ex. balanced scorecards, BCG matrices) to push the organization up the value escalator. While often these efforts are focused, intentional, and executed with the full support of the organization, they fall short due to a fundamental flaw in the perception of the Analytic Value Escalator. ## **Reality of the Analytic Value Escalator** ![The Financial Planning & Analysis Chasm](https://uploads-ssl.webflow.com/6363ef9d34ca74e4c5cc8a92/636d697ecb31fcb045f66ad3_3f4b9d_0c6127b38db84285881c4682195c2b91~mv2.png) The difficulty in bridging the gap from Reactive to Proactive is due to an often-overlooked chasm. **The chasm is represented by a gap in technology, personnel, expertise, information, data collection, and/or capitalization**. With an understanding that this chasm exists, we can bucket the Gartner Analytic Value Escalator into 3 main phases: Reactive, Iterative, and Proactive. **The Reactive phase is well understood, and processes are often governed by regulated principles and procedures**. Movement between Descriptive and Diagnostic Analytics is fluid and natural. This phase is managed by leadership (Controller, CFO, etc.) all the way through individual contributors (Accountants, Analysts). A firm typically builds out a robust and well staffed organization to support these deliverables. **The Iterative phase is implemented by organizations wishing to understand their business on a deeper level**, often due to missing targets, exponential growth, additional funding, or low gross margins. The Iterative Phase is usually underfunded, often staffed by a single analyst with a focus on systems, or funded by broadening the responsibility of those managing the Reactive Phase. [Finance Business Partnering Playbook | Finance AllianceThe step-by-step guide that takes you from a number cruncher to a strategic business partner.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/FA_Finance_Business_Partnering_Playbook_Blog_2-2.png)](https://www.financealliance.io/finance-business-partnering-playbook-2/) In a standard Finance organization, **the Proactive phase is typically owned by the Senior Leadership Team (SLT) with analytic support from contributors at all levels**. Objectives and targets are set using experience, and backed up by Descriptive and Diagnostic Analytics, ending with directives being established. This is best illustrated by the standard implementation of an Annual Operating Plan – typically characterized by a once-per-year target set by management (or investors), followed by a series of modeling gymnastics performed by management and analysts to support the targets. During this commonly practiced approach, there is no Iterative Phase, but rather an extension of Descriptive and Diagnostic Analytics applied to a Proactive state hypothesis. The team driving this (AOP) process is usually well-funded and staffed. Success with the AOP process gives organizations a false sense of a successful transition to the Proactive phase. ## **Understanding the Chasm** ![The Financial Planning & Analysis Chasm](https://uploads-ssl.webflow.com/6363ef9d34ca74e4c5cc8a92/636d697fb06330af16519f7b_3f4b9d_ed28def1e8944bd2810ef2624f94e9cc~mv2.png) The Proactive State is typically visualized by the Senior Leadership Team members, translated into metrics, and pushed down to those managing Reactive Analytics. The Reactive Analytics team then stretches the most versatile players to put the bare minimum processes and analytics in place to report on the SLT-defined metrics that matter. However, the SLT team is rarely aware of the assumptions and efforts taken by those tasked to deliver, often clouding the results. Further, those tasked to deliver are rarely fully informed of the original problem, making it impossible to anticipate future requests and, therefore, implement scalable processes and systems from the outset, leading to a high level of effort and further stretching of the team. To make matters worse, the metrics are still lagging indicators performed by teams that often revert to the tools available to them (Reactive analytics). This leads to a large productivity stall in the Iterative Phase. ## Signals you are entering the Iterative Phase of FP&A ![The Financial Planning & Analysis Chasm](https://uploads-ssl.webflow.com/6363ef9d34ca74e4c5cc8a92/636d697f4b90015292c7b6c4_3f4b9d_949eb40dcd5e4df5ad6a2f732012531d~mv2.png) ## **Characteristics of FP&A during the 3 phases** ### **Reactive Phase** - Focus on financial statement actuals - **Standard industry KPIs** - Informal planning cycle - Excel-based system and models - Manual processes with low automation - Tribal knowledge and information gaps - Minimal collaboration - Basic allocations - **Minimal understanding of unit economics** - Small & simple data sets ### **Iterative Phase** - CFO, VP/Director, 1-2 FP&A Analysts - Focus on Income Statement - **Company-specific KPIs** - AOP + Quarterly reforecasting - Bridge systems, disparate data sources - Semi-automated processes - SOPs as primary documentation - **Business Partnership focus, but little true interlocking** - Ad hoc profitability analysis - Basic understanding of unit economics - Some data, poor quality ### **Proactive Phase** - Data-science driven FP&A organization - **Data-driven OKRs & KPIs** - Rolling forecasts with snapshots for plan(s) - Integrated systems with high automation - Integration with GTM teams - Automated profitability analysis - **Deep understanding of unit economics** - Big data, ETL processes ## Recommended approach to crossing the FP&A Chasm ![The Financial Planning & Analysis Chasm](https://uploads-ssl.webflow.com/6363ef9d34ca74e4c5cc8a92/636d697eef41c92677f1c881_3f4b9d_cd55b9637dee454eabe66a50d4aa438b~mv2.webp) Once we recognize that we are about the enter the Iterative Phase, we can plan accordingly. **I call this the Iterative Phase because an organization doesn’t know what additional requirements and roadblocks will emerge until they’ve embarked on the journey**. For example, investing in a large system before gaining a clear understanding of data requirements, and unit economics, or before implementing a driver-based forecasting process, typically puts the Finance team right back into Excel for everything but the most basic storage and reporting needs. I’ve found a successful approach is to recognize this period of uncertainty, get the team comfortable with it, and step through it using available systems and resources, followed by short-term bridge systems and scaling the team based on permanent requirements. [How to build a culture of financial data analytics | Brian Kalish | Finance AllianceOur ‘new normal’ keeps changing and finance teams must adjust processes including people, process, culture, and technology to adapt. Confronting a historic level of uncertainty has rendered traditional methods of data analytics, forecasting, and scenario planning all but useless.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/sean-pollock-PhYq704ffdA-unsplash-2.jpg)](https://www.financealliance.io/how-to-build-a-culture-of-financial-data-analytics-to-develop-and-act-on-business-insights/) Take these six actions to successfully cross the value escalator chasm: 1. Outline (document or brief) the Transformed State, and ensure you have the right team (internal or advisors) to help you chart the path to get there 2. Document "What Constitutes Success" at each stage of the journey, and couple these with Primary KPIs 3. See [Y Combinator video](https://www.ycombinator.com/library/6j-how-to-set-kpis-and-goals-sus-2019) on Primary KPIs, which is relevant for any sized business, but shapes the message for the team 4. Ensure everyone in the organization understands what you are setting out to do, why you are setting out to do it, and recommendations for how you intend to accomplish the goals are sourced 5. Don't enter into an implementation unless you have prototypes, detailed documentation, and clear success criteria for the post-transformation state 6. See our blog on implementations for a breakdown *Originally appeared on* [*analystintelligence.com* ](https://www.analystintelligence.com) --- ## Ready to advance to the next level in your FP&A career? Our [FP&A Certified Core course](https://certified.thealliance.io/course/fpa-certified-core) is your gateway to becoming a leader in the finance industry. This course is specifically tailored to provide you with the insights and techniques used by top FP&A professionals. Through a series of comprehensive modules, you'll learn how to harness sophisticated financial tools, perform impactful analysis, and deliver results that propel your company forward. With our expert guidance, you’ll not only achieve certifications but also gain a competitive edge in your career. [Enrol today](https://certified.thealliance.io/course/fpa-certified-core) ### How to break into FP&A without experience URL: https://www.financealliance.io/breaking-into-fp-a-without-fp-a-experience/ Last updated: 2025-04-07T10:16:34.000Z [Financial planning and analysis (FP&A)](https://www.financealliance.io/your-ultimate-guide-to-fp-a/) is a field that involves the analysis of an organization's financial performance and forecasting future financial performance. FP&A professionals work closely with management to develop long-term financial strategies, budget plans, and forecasted financial statements. They also analyze the company's financial performance, identify trends and variances from the budget, and provide recommendations to improve financial performance. FP&A is an important function that helps a company make informed business decisions and achieve its financial goals. If you’re interested in breaking into the field of FP&A but don't have any prior experience, here are some steps you can take: ### Learn about FP&A Start by gaining a solid understanding of the fundamentals of financial statements. Take the time to learn about the specific roles and responsibilities of an FP&A professional. This includes understanding management reporting, profitability and variance analysis, financial modeling, budgeting, and forecasting, as well as the tools and technologies commonly used in FP&A. --- [3 ways FP&A can thrive amongst a field of skepticismIn this article, you’ll discover three ways an FP&A professional (or an FP&A team) can survive and thrive amongst a field of skepticism.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Page![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/FP-A-professional.jpg)](https://www.financealliance.io/3-ways-an-fp-a-professional-can-thrive-amongst-a-field-of-skepticism/) --- ### Consider earning a relevant degree or certification A bachelor's degree in finance or accounting can be beneficial for a career in FP&A. Additionally, obtaining a professional certification such as a Chartered Accountancy (CA) or Certified Management Accountant (CMA) can help demonstrate your knowledge and skills to potential employers. ### Gain experience in finance or a related field. While you may not have FP&A experience, any experience in finance or a related field such as accounting or business analysis can be beneficial. This experience can help you develop the skills and knowledge necessary for a career in FP&A. ### Network and build relationships with professionals in the field. Connecting with professionals in the [field of FP&A](https://www.financealliance.io/how-fp-a-teams-can-drive-real-growth-in-2023-q-a-with-christian-wattig/) can help you learn more about the industry and potentially open up job opportunities. Attend industry events, join relevant professional organizations, and consider reaching out to professionals in the field to learn more about their experiences and advice for breaking into the field. ### Be proactive in your job search. While you may not have direct FP&A experience, you can still highlight your relevant skills and knowledge in your job search. Look for entry-level positions or internships in finance or FP&A and tailor your resume and cover letter to highlight your relevant skills and experiences. --- [10 big-picture financial planning steps to maximize profitsDiscover 10 financial planning steps to help supercharge profits and achieve long-term success.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/02/big-picture-financial-planning.jpg)](https://www.financealliance.io/10-big-picture-financial-planning-steps/) --- ### Do pro bono work with NGOs and organizations that are in need of assistance. Offer to volunteer your time and skills to help them with their financial planning and analysis. This can be a great way to gain practical experience while also making a positive impact in your community. ### Volunteer for cross-functional projects. Many organizations have cross-functional teams that work on projects that involve multiple departments. Volunteering for such projects can give you the opportunity to work with financial data and contribute to the financial planning and analysis process. ### Keep an eye out for internal job openings or internships in FP&A and consider applying if you feel that you’re a good fit. These opportunities can provide valuable experience and help you build your resume. ### To conclude… Overall, breaking into FP&A without prior experience will require a combination of education, experience, and networking. With hard work and dedication, you can position yourself as a strong candidate and increase your chances of success in this field. Be persistent. It may take time to land a job in FP&A, but don't give up. Keep learning, networking, and applying for jobs until you find the right opportunity. *This article was originally published on* [*www.fpnaprofessionals.com*](https://www.fpnaprofessionals.com/posts/breaking-into-fpna-without-fpna-experience) --- ### Finance Business Partnering Playbook URL: https://www.financealliance.io/finance-business-partnering-playbook-2/ Last updated: 2025-04-04T10:38:15.000Z ### The step-by-step guide that takes you from a number cruncher to a strategic business partner. Finance business partnering is more than just a job title. It’s a unique combination of personality traits, skills, and capabilities that collide to form world-class business leaders and strategy advisors. ## ‌What’s inside? In this playbook, you’ll learn: - Why it’s so important for finance professionals to move into a partnership role - How to get started and demonstrate your value - Overcoming common barriers and getting a seat at the table - Key traits and skills of a finance business partner - Core principles of financial leadership - How to develop a plan to become a finance business partner ‌Dive into this playbook and uncover tips, strategies, insights, and advice from some of the most influential people in finance business partnering, such as FP&A Prep’s Christian Wattig, The Finance Business Partner’s Andrew Jepson, and Business Partnering Institute’s Christian Frantz Hansen. Start your journey to becoming an irreplaceable asset to your organization.👇 ‌ ## **Take your business partnering skills even further with our Business Partnering & Storytelling: Certified course** Build the skills and expertise you need to take the step from ‘number cruncher’ to strategic business partner. Our certified ‘[Business Partnering & Storytelling](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters )’ course gives you immediate access to five hours of bite-sized video lessons, detailed slides for review, and a bunch of downloadable examples and cheat sheets to help you become the ultimate finance business partner and storyteller. With Christian Wattig (founder of FP&A Prep) as your coach, you’ll learn how to build and nurture relationships, provide insightful guidance to influence decisions, and turn complex data into compelling stories that inspire action.‌ ‌ ### How finance digital transformation can impact your company URL: https://www.financealliance.io/how-finance-digital-transformation-impact-company/ Last updated: 2025-10-10T08:21:51.000Z In today's fast-paced business world, finance digital transformation is crucial for organizations to stay ahead of the game. From streamlining processes and increasing efficiency to providing real-time insights and improving data accuracy, financial transformation is the ultimate game changer. But don't just take our word for it! Stick around to learn about specific examples of finance digital transformation success stories and find out how finance leaders can ensure a successful transformation for their organization. **Topics covered:** - [How finance digital transformation can improve your role in finance](https://www.financealliance.io/p/4026d5c2-6108-43d5-b948-ede033e3c7c9/#how-finance-digital-transformation-can-improve-your-role-in-finance) - [Before and after financial transformation](https://www.financealliance.io/p/4026d5c2-6108-43d5-b948-ede033e3c7c9/#before-and-after-financial-transformation) - [How it leads to better collaboration](https://www.financealliance.io/p/4026d5c2-6108-43d5-b948-ede033e3c7c9/#how-finance-digital-transformation-leads-to-better-collaboration) - [How finance digital transformation helps you excel within your role](https://www.financealliance.io/p/4026d5c2-6108-43d5-b948-ede033e3c7c9/#how-finance-digital-transformation-helps-you-excel-within-your-role) ## **How finance digital transformation can improve your role in finance** Technology is revolutionizing the finance function. But it isn’t just about automating repetitive tasks. It also instills a new level of visibility, allowing finance professionals to provide valuable insights that drive the business forward. We asked finance leaders to share their thoughts on how they believed finance transformation positively impacts the roles of finance professionals, from FP&A Managers to CFOs. Here's what they had to say: ![Angelina Hendraka quote](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Financial-transformation-quote-1.png) ![Tjendra Halima quote](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Financial-transformation-quote-2.png) ![Paula Mota quote](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Financial-transformation-quote-4.png) ![Brian Kalish quote](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Financial-transformation-quote-3.png) *(Source:* [*The State of Finance Transformation Report 2022*](https://www.financealliance.io/state-of-finance-transformation-report-2022/)*)* ### Before and after financial transformation If you’re in finance, you’ve surely heard all sorts about how technology, AI, and automation are impacting finance functions around the world. Many claim that finance digital transformation helps to streamline processes, increase efficiency, and provide real-time insights into the organization's financial health. But do those claims hold any truth? We wanted to find out, which is why we put it to the test in our [State of Finance Transformation Report](https://www.financealliance.io/state-of-finance-transformation-report-2022/). Interestingly, 37%of our respondents estimated that they spent 21% – 40% of their time on manual tasks (*before turning to technology for help*), while 22.2% said they spent up to half of their time on tedious tasks that added little value or impact. ![Financial transformation - insights from the State of Finance Transformation Repor](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Finance-digital-transformation.png) When asked whether they noticed a positive change in the speed and efficiency of day-to-day processes after implementing digital transformation, the collective response was a positive YES. Here are a few responses from some of our participants on how finance transformation has improved their existing processes: > *“Moving billing to an automatic process has changed the speed of our billing process by 30%.”* > *“Our manual processes have been reduced by half.”* > *“Processes such as month-end close are down from 15-20 days to 5-7.”* --- [What is big data security analytics?From network intrusions and malicious insider activity to data breaches and compliance violations, the risks to a company’s sensitive data are at an all-time high. So, how can you protect data from theft and other malicious threats?![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/hacker-g63e41dc9d_1280-2.jpg)](https://www.financealliance.io/what-is-big-data-security-analytics/) --- ## **How finance digital transformation leads to better collaboration** Technology can help the finance function collaborate with other departments in several ways. For example, by providing real-time access to financial data and insights, better-informed decision-making is practiced across multiple departments. Additionally, technology has made it easier for finance teams to communicate better with other teams. It has also enabled more efficient and effective collaboration on projects and initiatives, as teams can now easily share documents, track progress, and provide feedback in real time. This leads to more streamlined processes and better alignment between departments, ultimately driving better financial results for the organization. According to our survey, 96.3% of finance professionals said that thanks to finance digital transformation, they’ve been able to work with other departments within their organization. Meanwhile, just 3.7% said that they haven’t had any increased opportunities to collaborate with other business functions. ![Digital finance transformation - insights from the State of Finance Transformation Repor](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Finance-transformation.png) ### Who are finance teams collaborating with? Finance professionals were able to choose multiple answers to this one, as we wanted to see just how collaborative they were able to be by implementing certain technologies to assist them within their roles. Administration and/or operations came out on top with 70.4% of votes, which shows that finance and operations really do go hand-in-hand. Finance has also been able to work closely with marketing and sales with 66.7% of respondents stating that they’ve been able to collaborate with them closely. Some other departments, that finance professionals have worked with since introducing new technologies to the finance function, include human resources (55.6%), customer service (44.4%), and research and development (14.8%). ![Finance digital transformation - insights from the State of Finance Transformation Repor](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Finance-digital-transformation-graph.png) ## How finance digital transformation helps you excel within your role Financial transformation can have a huge impact on your role. Some of the most common ways that technology has transformed finance roles for the better include: - More visibility and improved processes. - Increased capacity to perform higher-value activities. - Improved data display and efficiency. - New learning experiences and opportunities for collaboration. - More accurate results. Here are some more insights from respondents of our survey: > *“I’m now seen as a change agent and source of knowledge.”* > *“I led a small FP&A task force that gave me visibility. I am now more focused on the storytelling rather than verifying the numbers and have unlocked time to put towards Business Partnering, which in the end increases my knowledge on the business.”* > *“I now can provide value- added, data-driven analyses with minutes/hours versus days.”* > *“Finance transformation made my processes faster and easier, so I don’t waste time in machinal tasks.”* > *“It’s allowed me to demonstrate project leadership and cross-functional leadership. I’ve also been able to gain credibility as a change agent and it has made my processes more efficient.”* --- [What is finance transformation? | Finance AllianceIn this article, we’re diving into what finance transformation means, the key drivers of it, and why it’s something that needs to be on your radar in 2023 and beyond.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/what-is-finance-transformation.jpg)](https://www.financealliance.io/what-is-finance-transformation/) --- ### Which daily processes benefit the most from digitalization? Financial planning and analysis (FP&A) involves performing budgeting, forecasting, and analysis to support business leaders with decision-making. When the C-Suite have questions, they look to the FP&A team for answers, which usually means that anyone responsible for FP&A within a company probably has a lot on their plate. The good news is that FP&A has come out on top as the main process or activity that has benefited the most from automation and digitalization, with over half (55.6%) of respondents in agreement. 33.3% said that accounting benefited the most, while 3.7% collectively reported seeing an improvement in processes such as risk assessment, scenario planning, and tax optimization. ![Financial transformation - insights from the State of Finance Transformation Repor](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Finance-digital-transformation-data-graph.png) Digging a little deeper into exactly *where* technology has had a positive impact within organizations, we asked participants to state whether finance transformation has impacted some key aspects of their role and the company. Some interesting findings turned up as a result, with over half (55.6%) of respondents stating that they strongly agreed that technology has improved the speed of their processes. Here is an overview of the responses and whether participants agreed or disagreed with the following statement: ![Finance digital transformation - insights from the State of Finance Transformation Repor](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Finance-digital-transformation-image.png) ![Finance digital transformation - insights from the State of Finance Transformation Repor](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Finance-digital-transformation-charts.png) ![Finance digital transformation - insights from the State of Finance Transformation Report](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/digital-finance-transformation-chart.png) **Want to learn more about finance digital transformation and access even more insights?** Download *The State of Finance Transformation Report 2022* and discover: 💡 Where finance transformation is **now**. 🔑 **Key drivers** of finance transformation. 💰 The positive impact of **automation in finance**. 🤔 **Common challenges** and how to overcome them. ⚒️ How to develop a **culture of change**. 🔮 What a **successful adoption** of finance transformation looks like. ….and so much more. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/01/FA_State_of_Finance_Transformation_Report_2022_CTA.jpg) ](https://www.financealliance.io/state-of-finance-transformation-report-2022/) ### "It’s great to have a group of people to bounce ideas off of." - Adam Tzagournis, CPA, FlowCog URL: https://www.financealliance.io/adam-tzagournis-community-case-study/ Last updated: 2023-01-27T09:28:35.000Z [Adam Tzagournis, CPA](https://www.linkedin.com/in/adam-tzagournis-cpa/) is the founder & CEO of **FlowCog**, a battle-tested financial modeling tool designed specifically for SaaS companies. He’s also a Brazilian Jiu-Jitsu blue belt. 🥋 Adam is also an active member of the [Finance Alliance Slack community](https://www.financealliance.io/community/), a supportive, informal, and inspirational space where finance leaders network with like-minded people. From sharing ideas to offering advice to your peers, our Slack community is the ultimate space for finance pros who want to accelerate their careers. In this case study, Adam shares his thoughts and experience as an active member of our community, covering: - [Why he joined our community](https://www.financealliance.io/adam-tzagournis-community-case-study/#what-was-your-motivation-for-joining-our-community) - [What he has enjoyed the most](https://www.financealliance.io/adam-tzagournis-community-case-study/#what-have-you-enjoyed-most-since-joining) - [The most insightful discussions](https://www.financealliance.io/adam-tzagournis-community-case-study/#what-type-of-discussions-have-you-found-the-most-insightful-and-useful) - [Helpful resources](https://www.financealliance.io/adam-tzagournis-community-case-study/#what-type-of-resources-have-you-found-the-most-helpful) - [Building new connections](https://www.financealliance.io/adam-tzagournis-community-case-study/#have-you-built-up-any-new-connections) - [Why you should join](https://www.financealliance.io/adam-tzagournis-community-case-study/#why-should-other-finance-professionals-join-the-community) ### What was your motivation for joining our community? I’m a finance nerd and love helping others! Seems like a waste if I were to spend so much time and research on finance and SaaS and not share any of the learnings. ### What have you enjoyed most since joining? It's great to be around other Finance folks that have a wide array of experiences in different industries. That way, you get the most useful takeaways from each and can make them your own. ### What type of discussions have you found the most insightful and useful? I really enjoyed seeing other folks share their experience in FP&A and how they got to where they are today. It's really interesting to see how that shapes someone's perspective on the role of Finance in an org. ### What type of resources have you found the most helpful? I really enjoyed some of the [blog posts](https://www.financealliance.io/articles/) that Finance Alliance has put out recently. Particularly the ones on how to cut costs on the software subscriptions side of the business, as well as the post on financial transformation and [how technology will change the Finance role](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/). --- [The State of Finance Transformation Report 2022 | Finance AllianceThe State of Finance Transformation Report 2022 from Finance Alliance reveals exactly how technology is shaping modern finance functions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/FA_State_of_Finance_Report_2022_Meta.jpg)](https://www.financealliance.io/state-of-finance-transformation-report-2022/) --- ### Have you built up any new connections? Yes! It seems like everyone is genuinely interested in helping each other, which I think is the basis for building a community in the long run. ### Why should other finance professionals join the community? Even if you're not contributing on a daily basis, it’s great to have a group of people you can bounce ideas off of and get a gut check on your instinct. --- ### **Join the Finance Alliance Community** Sign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders. Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. So, what are you waiting for? [Sign up today](https://www.financealliance.io/community/)! (it’s free) [![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg)](https://www.financealliance.io/community/) ### Why value proposition budgeting is key to boosting revenue URL: https://www.financealliance.io/why-value-proposition-budgeting-is-key-to-boosting-revenue/ Last updated: 2024-09-18T08:03:29.000Z Is value proposition budgeting right for your business? It *could* be, especially if you want to avoid unnecessary spending and ensure every penny delivers value. But before you jump in headfirst and shake up your entire budgeting process, let’s take a moment to understand how this form of budgeting impacts the bottom line. In this article: - [What is value proposition budgeting?](https://www.financealliance.io/p/f3219534-8b6b-491a-88aa-845a70f3edce/#what-is-value-proposition-budgeting) - [Who’s responsible?](https://www.financealliance.io/p/f3219534-8b6b-491a-88aa-845a70f3edce/#who%E2%80%99s-responsible) - [How it works](https://www.financealliance.io/p/f3219534-8b6b-491a-88aa-845a70f3edce/#how-it-works) - [Important questions to ask during budget plan meetings](https://www.financealliance.io/p/f3219534-8b6b-491a-88aa-845a70f3edce/#important-questions-to-ask-during-budget-plan-meetings) - [How value proposition budgeting increases profits](https://www.financealliance.io/p/f3219534-8b6b-491a-88aa-845a70f3edce/#how-value-proposition-budgeting-increases-profits) - [Key advantages and disadvantages](https://www.financealliance.io/p/f3219534-8b6b-491a-88aa-845a70f3edce/#advantages-and-disadvantages) ## **What is value proposition budgeting?** In today's fast-paced business world, you've got to make the most of every dollar in your company’s budget. And that's where value proposition budgeting comes in. Value proposition budgeting prioritizes initiatives based on how much monetary value they'll bring to the company. It’s a strategic process that forces finance teams to scrutinize spending and make decisions based on value above all else. By focusing on the value each endeavor provides, companies ensure their budget is used in a way that drives revenue and growth. ## **Who’s responsible?** In most companies, the finance team controls the budget in partnership with other departments such as marketing, sales, and product development. They'll also track the performance of the chosen initiatives to make sure that they’re delivering the value promised. However, it’s important to note that this form of budgeting is a cross-functional effort. It requires collaboration among different departments to be successful – including key members of the C-Suite like the CEO, CMO, and CFO. --- [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) --- ## How it works The process starts by identifying your company's value proposition, which is the unique combination of products, services, and experiences that the business offers to its customers. Next, you’ll look at different projects and evaluate how well they align with that value proposition. This can help you determine which projects are most likely to drive revenue and growth for the business. Think of it like holding up a magnifying glass to every item on the company’s expenditure list to evaluate its real value. Once you’re clear on that, it’s time to decide where the budget should be spent for a positive return on investment. The entire process boils down to these three steps: **1.** Clarify the company’s overall goals, vision, and desired results. **2\.** Identify what products, services, programs, software, etc. the company spends capital on. **3.** Allocate the budget and resources to the initiatives that drive the highest value. --- [How FP&A teams can drive real growth in 2023 | Q&A with Christian WattigChristian Wattig, Managing Director at FP&A Prep, recently answered the Finance Alliance Slack Community’s burning questions about how to best prepare for 2023.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/fp-a-teams-success-2023.jpg)](https://www.financealliance.io/how-fp-a-teams-can-drive-real-growth-in-2023-q-a-with-christian-wattig/) --- ## **Important questions to ask during budget plan meetings** Now that you understand the basic steps of the value proposition budgeting process, it’s time to finalize where to allocate company resources. Sounds fairly simple until you realize that determining the value of each expense is more challenging than you thought. To help you make those tough decisions, try asking these important questions during your next budget plan meeting: **1\.** Why is this expense included in our budget plan? **2\.** What value, if any, does this expense provide? **3\.** Does the value of this expense exceed its initial price? **4\.** How will this expense impact our operating profit? **5\.** What metrics will we use to track performance and determine if this expense is delivering the value promised? By asking these questions and evaluating the answers, you can make sure that the company’s budget is being used in a way that’ll help drive revenue and growth for the business. ![Value proposition budgeting to drive growth - image of gold bars](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/value-proposition-budgeting.jpg) ## **How value proposition budgeting increases profits** Value proposition budgeting helps increase profits by: 1\. Aligning budget and resources with the value proposition. 2\. Prioritizing investments and initiatives that drive the most revenue and growth. 3\. Tracking the performance of different initiatives to ensure that they’re delivering the value promised. ## Advantages and disadvantages Although value proposition budgeting is an excellent tool to allocate budgets in a way that helps generate more income, it’s not always smooth sailing. Here are some of the main pros and cons of using this [budgeting method](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/): ### The good: - Better alignment of resources as you can focus spending on areas that’ll deliver the most value. - Improved performance tracking as you’ll see exactly where the cash is going. - Makes it easier to prioritize future expenses and increases the potential to save money and boost revenue. ### The not-so-good: - It’s hard to measure value, which can be considered to be an abstract concept. - The budget and the value of an expense need to be reassessed regularly alongside changing market conditions. - You can miss out on valuable opportunities as your attention is always on existing expenses. Value proposition budgeting is an effective approach to budgeting that can help businesses achieve their goals by focusing on creating and delivering value to customers. However, it requires more time and resources, cross-functional collaboration, and a clear understanding of the value proposition. It's important to weigh the advantages and disadvantages and decide if it's the right approach for your business. --- ## **Take our Budgeting & Forecasting: Certified course** Take your financial planning to the next level with **"**[**Budgeting & Forecasting: Certified**](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters)**"** and learn directly from FP&A expert **Christian Wattig**, whose extensive experience spans multinational corporations and fast-growing startups. Through this course, you’ll gain a comprehensive understanding of the five phases of budgeting and develop the forecasting techniques that drive better business outcomes. Whether you’re refining your budgeting approach or learning how to forecast with greater accuracy, this course equips you with practical tools to make informed financial decisions. [Sign up](https://certified.thealliance.io/course/budgeting-and-forecasting-certified-masters) ### How FP&A teams can drive real growth | Q&A with Christian Wattig URL: https://www.financealliance.io/how-fp-a-teams-can-drive-real-growth-in-2023-q-a-with-christian-wattig/ Last updated: 2025-04-07T10:17:33.000Z How can FP&A teams better support the business in 2023? And, is it really time to leave Excel in the past, or have you been looking at it all wrong? [Christian Wattig](https://www.linkedin.com/in/christian-wattig/), Managing Director at [FP&A Prep](https://www.fpaprep.com), recently answered the [Finance Alliance Slack Community’s](https://www.financealliance.io/community/) burning questions about how to best prepare for 2023. Here’s what he had to say.👇 **Topics covered:** - [Two key ways to make areas of financial planning less overwhelming](https://www.financealliance.io/p/3e6778b7-ff88-4756-8bd8-d1c9a151e271/#two-key-ways-to-make-financial-planning-less-overwhelming) - [How to make a convincing argument for a standard budget process](https://www.financealliance.io/p/3e6778b7-ff88-4756-8bd8-d1c9a151e271/#how-fpa-teams-can-make-a-convincing-argument-for-a-standard-budget-process) - [How to stay ahead of accelerating change in 2023](https://www.financealliance.io/p/3e6778b7-ff88-4756-8bd8-d1c9a151e271/#how-to-stay-ahead-of-accelerating-change-in-2023) - [Why you don’t need to leave Excel behind in 2023](https://www.financealliance.io/p/3e6778b7-ff88-4756-8bd8-d1c9a151e271/#why-you-don%E2%80%99t-need-to-leave-excel-behind) - [The importance of automating data consolidation](https://www.financealliance.io/p/3e6778b7-ff88-4756-8bd8-d1c9a151e271/#the-importance-of-automating-data-consolidation) - [How FP&A teams can better support the business](https://www.financealliance.io/p/3e6778b7-ff88-4756-8bd8-d1c9a151e271/#how-fpa-teams-can-better-support-the-business) - [Why driver-based financial models don’t have to be complicated](https://www.financealliance.io/p/3e6778b7-ff88-4756-8bd8-d1c9a151e271/#why-driver-based-financial-models-don%E2%80%99t-have-to-be-complicated) - [Scenario planning & analysis is vital for budgeting](https://www.financealliance.io/p/3e6778b7-ff88-4756-8bd8-d1c9a151e271/#scenario-planning-analysis-is-vital-for-budgeting) ### Two key ways to make financial planning less overwhelming ***Q: What’s your advice for making financial planning a year-round process without it being so overwhelming?*** **A:** I have two pieces of advice for this. Number one is that your annual plan needs to be at a level of detail that makes it possible to learn from your variances throughout the year. If your annual plan was done at too high a level of detail, you won't be able to look at those variances. And for sure, you’ll have variances and say, “*Okay, this tells me that that strategy probably didn't work as planned*,” or, “*This tells me that this driver or input to my business didn't have the ROI that we expected originally*.” So that's number one, you need to make sure that your annual plan is detailed enough. Number two is using rolling forecasts. A traditional forecast always tries to predict the remainder of the year. So, let's say your fiscal year ends in December. If you were at the beginning of December already, you’d only have one month to forecast. But in a rolling forecast, you're always trying to predict a certain number of months. Most companies use 12 months. In other words, when you're at the beginning of July, you don't just predict six months, you're always looking at 12 months in the future no matter which month you're at. The big advantage of that is that it makes the annual planning process a lot less overwhelming because you don't start from zero. You have your rolling forecast as a base, which you can use to go deeper and set yourself up for success in the next year. --- [What is cash flow-based financial planning? | Finance AllianceFinancial planning is vital for organizations that want to cement their success and ensure their future is a bright one. Many argue that cash flow based financial planning is the most effective way to plan and manage resources by focusing on the amount of cash coming in and going out of a business.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/cash-flow-based-finanical-planning.jpg)](https://www.financealliance.io/what-is-cash-flow-based-financial-planning/) --- ### How FP&A teams can make a convincing argument for a standard budget process ***Q: How do you convince a CEO who likes to make top-down decisions shortly before a board meeting that a standard budget process makes more sense?*** **A:** This all comes down to winning your CEO's trust, essentially. What I would recommend is to start putting together a rough outline of what a budget process would look like, ideally with some inputs you’ve already collected from the different teams. Then, you can walk your CEO through that leading up to the board meeting and highlight how the thoughts of the subject matter experts can be great inputs for their final budget model. I wouldn't try to convince them to stop doing what they were doing at this stage. Rather, I’d share information that can make their top-down budget more effective, accurate, and insightful. Then, hopefully, they’ll realize during this process that with more lead-up and more involvement from the other teams, having a proper bottom-up that can be compared to their top-down is the best way to go. The argument they usually give people when they’re unsure whether a top-down is enough is if you do a bottom-up and a top-down, you can compare them to each other and use them to iterate, and critically, they’re a great conversation starter. Often, your top-down budget will be more aggressive than your bottom-up budget, and you can use the difference between the two to talk to the team and say, “*Okay, you're telling me you’re bottom-up and we can hit that revenue number. What do you need to get there? What’s missing? What changes do we need to make to the business and what risks and opportunities do you see?*” So, that's a good argument for a standard budget process that includes both a top-down and a bottom-up. ### How to stay ahead of accelerating change in 2023 ***Q: What are the primary concerns that*** [***FP&A***](https://www.financealliance.io/tag/fp-a/) ***professionals should acknowledge and prepare for in 2023?*** **A:** Most likely change. The rate of change will continue to accelerate in the next year. We may or may not have a deeper recession and other things will happen, so you need to prepare for that. How you prepare for that is to make sure that your processes are as automated as possible. Ideally, you need to be able to get real-time data as quickly as possible to stay ahead of the change and be able to respond to changes in trends before the end of the month or the end of the quarter, and before it's too late. That’s number one. The other one is that you need to meet more frequently with your cross-functional business partners as a finance leader. If you currently meet on a monthly or even just a quarterly basis, that's not enough. I strongly recommend having weekly check-ins with your main business partners. It doesn't mean you need to reforecast or prepare a big deck of what you see going on in the business every week. But you can make your KPIs show how you're trending on a weekly basis just by doing math. This allows you to hear about risks that your business partners may see coming much sooner. Also, the more frequent interactions give you more opportunities to show your cross-functional business partners that you can do more than cutting budgets or updating forecasts. That will then build trust and a relationship and they’ll be more likely to share doubts or concerns with you before it's too late. That's how you can stay ahead of the accelerating change that we'll likely see next year. --- [Infographic | 10 FP&A best practices 2023 | Finance AllianceThe best-run finance functions have mastered the art of FP&A. They’ve proved that when done right, FP&A doesn’t just predict business outcomes, it can drive them too. Here, you’ll find our infographic detailing the top FP&A best practices of 2023.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/FP-A-BEST-PRACTICES-2.jpg)](https://www.financealliance.io/infographic-10-fp-a-best-practices/) --- ### Why you don’t need to leave Excel behind ***Q: Do you have any suggestions for a making gradual shift from Excel to a new FP&A solution when some team members are reluctant to leave Excel behind?*** **A:** What's important to know is that there are two philosophies when it comes to an FP&A solution. Some companies make software that gets people out of Excel because they say it’s old and lacks features, so it's better if they learn their software and stop using Excel. However, there are other companies that make FP&A software that builds on top of Excel. That software doesn't encourage people to leave Excel behind and argues that Excel has been around for decades. The reason that Excel’s still going strong is mainly for two reasons: 1. It's very easy to use. There are fantastic resources, even free ones on YouTube to help you learn Excel. 2. It's incredibly flexible. You can do basically anything you’d like with Excel. Those two reasons are why Excel is so popular, and also because people are used to it and learned it in school. So, I would definitely look at those solutions as well. I'm a bit biased of course because I work at Datarails. Datarails is an FP&A software company and they make a tool that sits on top of Excel, brings it into the cloud, and adds sophisticated database and automation features on top of it. But that's just one of the solutions. There are others out there as well that help with allowing you to keep using Excel, and keep using the flexibility and ease of use while adding automation into the mix. ### The importance of automating data consolidation ***Q: Do you have any advice for efficient and effective data consolidation?*** **A:** I call data consolidation a non-value-adding task. What I mean by that is that it doesn't add value, because spending more time on data validation doesn't drive your business forward. You want to spend time on value-adding tasks like business partnering, financial analysis, separating raw data from insights, and making recommendations. The goal has to be to fully automate your consolidation. It should be a click of the button and all your sources come together and output the report in the layout you want. You may be able to do that through Excel, but you need to be mindful that there are many tools out there that can help you with automating your consolidation. You have a setup period with most of them, and you set them up once. And with most software services, you don't have a large upfront cost. Once they're up and running, it’s as easy as clicking a button and your consolidation process runs in the background. A few seconds later, you’ll have your consolidated report and you can spend the time you saved on those value-adding, higher-level finance tasks. So, in 2023, I would strongly recommend that if you're still spending more than 10 minutes consolidating your data, stop and look for a tool that can help you with that. ### How FP&A teams can better support the business ***Q: Do you have any financial planning tips or advice on how FP&A teams can better support the business?*** **A:** My number one piece of advice is to go and ask them more questions. The response I sometimes get when I suggest that is, “*If I go and ask them a lot of questions, isn't that a bit selfish? Doesn't that take away their time when they're already busy? Do they have time to listen to my questions?*” But if you ask the questions the *right* way and at the *right* time, you're actually helping the business because you’re encouraging them to think outside of the box and look at new ways to approach the business. Specifically, the question I recommend you ask is, “*In an ideal world, what do you like to know about your business, and when to make better decisions?*” Because sometimes people feel that there's certain information we won't be able to get for them or certain analysis we can’t run before a certain date. And that holds people back from making those requests to the [FP&A team](https://www.financealliance.io/3-ways-an-fp-a-professional-can-thrive-amongst-a-field-of-skepticism/). But if you ask the question that way, “*What would you like to know and when?*” That opens the door for discussions that can lead to you creating new reports, new metrics, and new insights that can really help drive the business forward. And then as a side effect of that, you're also showing that you’re an effective business partner, that you understand your business partners' goals, and that you want to do more and help them achieve their goals. It's not just about your goals. And you'll see when you keep doing that, that their relationships will improve, and they’ll be more likely to come to you and share how you can help drive the business forward. --- [7 Benefits of a cash flow forecast to drive business growthUnderstanding the role the cash flow forecast plays in your finances is so important, which is why we’re sharing the top cash flow forecast benefits to help drive sustainable business growth.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/benefits-of-a-cash-flow-forecast.jpg)](https://www.financealliance.io/7-benefits-of-a-cash-flow-forecast-to-drive-sustainable-business-growth/) --- ### Why driver-based financial models don’t have to be complicated ***Q: How can you build a driver-based financial model that isn’t overly complicated?*** **A:** A driver-based financial model predicts revenues by looking at the inputs into the business that have an effect on your revenue. For example, activities of the sales team, marketing activities, upgrades, changes to the product, changes to your pricing, etc. Yes, those driver-based models can get complicated, but often that's the case because people didn't spend enough time upfront really thinking through what the key drivers are. It can be easy to just try and list all the drivers that potentially have an impact on the business and then estimate the return on investment. But most likely, that’ll get you worse accuracy than if you approach it from an 80/20 approach, where you say, “*Okay, these are the three or four most important drivers that make up 80-90% of the variance that I can expect next year in my revenue*.” If you do that, you can spend more time on each, you can understand it better, and you can ask the business more questions to really improve your understanding of it. Then the model won't be as complicated. It’ll be easier to explain how the model works to non-finance business partners, and will also be easier to maintain. And on top of that, its accuracy will most likely be better as well. So, in a nutshell, spend more time before you even start building the model by analyzing the business and talking to different teams to understand what the three or four drivers are that make the most difference to your business right now. ### Scenario planning & analysis is vital for budgeting ***Q: How do you budget for growth and what risk factors are you considering?*** **A:** To create a budget for a growing company, scenario planning is essential. In other words, don’t just provide a point estimate, forecast a range. Start with the worst-case scenario, then work through what a best-case would look like. And don’t just do that for revenue at a high level, run the scenario analysis for every major business driver individually. Then you can add up the ranges to get a clear picture of not just your forecast for growth, but also the degree of risk that’s involved. If your budget doesn’t meet expectations, it’s easy to adjust individual ranges to reflect a scenario closer to the best case. Then you can make a clear statement about how much risk you’re considering by calling out the business drivers that assume a best-case scenario. --- **Don't miss our next Q&A session with a thought leader in finance - join the** [**Finance Alliance Slack community**](https://www.financealliance.io/community/) **today!** [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### How to avoid burnout as a high-growth CFO URL: https://www.financealliance.io/how-to-avoid-burnout-as-a-high-growth-cfo/ Last updated: 2024-09-27T09:31:01.000Z As a high-growth CFO, the pressure to meet financial targets, manage budgets, and make strategic decisions can be overwhelming. It's easy to get caught up in the day-to-day demands of the job and forget to take care of yourself. Unfortunately, this can lead to burnout, a state of physical, emotional, and mental exhaustion caused by prolonged stress. In this post, we’ll discuss practical ways for CFOs to avoid burnout and maintain a healthy work-life balance. We’ll cover topics such as: - [What is burnout?](https://www.financealliance.io/p/e05701d5-7aa9-458c-9237-742ed34897ca/#what-is-burnout) - [Signs to look out for](https://www.financealliance.io/p/e05701d5-7aa9-458c-9237-742ed34897ca/#signs-of-burnout) - [Common causes](https://www.financealliance.io/p/e05701d5-7aa9-458c-9237-742ed34897ca/#common-causes-of-workplace-burnout) - [Tips to avoid burnout](https://www.financealliance.io/p/e05701d5-7aa9-458c-9237-742ed34897ca/#helpful-tips-to-avoid-burnout-as-a-high-growth-cfo) - [How to help support someone struggling with burnout](https://www.financealliance.io/p/e05701d5-7aa9-458c-9237-742ed34897ca/#how-to-help-support-someone-struggling-with-burnout) --- ## **What is burnout?** As a high-growth CFO, you’re likely well aware of the many responsibilities that come with the role. From managing budgets and financial targets to making strategic decisions, the daily demands of the job can be overwhelming. However, when these demands become unmanageable, it can lead to workplace burnout. Burnout is a state of physical, emotional, and mental exhaustion. It can manifest in a variety of ways, including feelings of hopelessness, increased irritability, and a lack of motivation. It can also lead to physical symptoms such as fatigue, headaches, and sleep disturbances. For CFOs, burnout can be especially challenging as it can impact not only your personal well-being but your ability to perform effectively in your role. It can lead to poor decision-making, decreased productivity, and even errors in financial reporting. --- [Why leading CFOs prioritize employees’ mental health at workTo be a truly great CFO and leader, you need empathy and an understanding of mental health. In this article, I talk about the importance of addressing mental health and how you can better support your employees’ mental health at work, as well as your own.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Schöler![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/mental-health-at-work.jpg)](https://www.financealliance.io/why-leading-cfos-prioritize-employees-mental-health-at-work/) --- ## **Signs of burnout** It's important to remember that burnout isn’t a personal weakness, but rather a natural response to a great deal of stress. Once you recognize the signs, you can take the necessary steps to address and prevent burnout to maintain a [healthy work-life balance](https://www.financealliance.io/why-leading-cfos-prioritize-employees-mental-health-at-work/). Some common signs of burnout in CFOs include: - Feeling exhausted and drained, both physically and emotionally. - A lack of motivation and struggle to find enjoyment in your work. - Increased irritability and finding it hard to maintain professional relationships. - Difficulty concentrating and making decisions. - A sense of hopelessness and helplessness. - Physical symptoms such as headaches, fatigue, and sleep disturbances. ## **Common causes of workplace burnout** If you’re struggling with stress and burnout, you’re not alone. Workplace burnout is more common than you might think. A study carried out by[ Deloitte](https://www2.deloitte.com/us/en/pages/about-deloitte/articles/burnout-survey.html) reported that 77% of respondents have experienced employee burnout at their current job. So, what’s the main cause of feeling burnt out? The answer is *stress*. 91% of respondents said that having an unmanageable amount of stress or frustration negatively impacts the quality of their work and is the main driving factor toward burnout. Stress isn’t the only cause of burnout though. So, let’s take a look at some of the most common drivers: - **Excessive workload:** Having too much on your plate can be very demanding both mentally and physically, so don’t be afraid to push back when you need to. - **Lack of control:** A lack of autonomy or decision-making power can lead to feelings of helplessness and lack of control. This is often brought on when you feel like you have little to no influence over decisions that affect your job and/or personal life. - **Unclear expectations:** A lack of clear expectations or goals can lead to confusion and frustration. Not fully understanding what’s expected of you by the CEO, for example, can put you on edge. - **Poor work-life balance:** CFOs often work long hours, and it can be difficult to separate work from personal life, leading to burnout. ![workplace burnout - CFO tips to overcome burnout](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/high-growth-cfo-burnout-in-the-workplace.jpg) ## Helpful tips to avoid burnout as a high-growth CFO When burnout strikes, it can be difficult to find a way out, which is why it’s so important to get help. Taking care of yourself is not only essential for your well-being, but it also enables you to make the most impact in your role. Here are some practical tips to help combat high-stress levels at work: **1\. Prioritize self-care:** Make sure to take care of your physical and mental health by getting enough sleep, eating well, and exercising regularly. **2\. Create boundaries:** Set clear boundaries between work and personal time and stick to them. This can help prevent work from invading your personal life and causing unnecessary stress. **3\. Take breaks:** Taking short breaks throughout the day can help refresh your mind and boost your productivity. **4\. Practice mindfulness:** Mindfulness practices such as meditation or yoga can help reduce stress and improve focus. **5\. Seek support:** It's important to have a support system in place, whether it be a therapist, counselor, or a group of trusted colleagues, who can offer guidance and support when needed. It's important to remember that combating burnout is a continuous process, and it's essential to make self-care and work-life balance a priority. Keep in mind that as a high-growth CFO, you’re not alone in this journey and it's important to seek support when needed. --- [CFO tips: How to predict and prepare for a financial crisisWhat can you do to prepare for a financial crisis? In this article, you’ll learn about the most common warning signs that there’s a financial crisis looming and how to prepare for one as the CFO of a company.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/how-to-prepare-for-a-financial-crisis.jpg)](https://www.financealliance.io/how-to-prepare-for-a-financial-crisis/) --- ## **How to help support someone struggling with burnout** Addressing burnout in the workplace is so important. As a high-growth in-house or [virtual CFO](https://www.financealliance.io/how-to-become-a-virtual-cfo/), you’re likely viewed as a leader alongside the companys CEO and other members of the C-Suite. This means that people look up to you and may come to you for support. However, not everyone on your team will feel confident enough to approach you about their struggles. This is why it’s important to know the signs and try your best to support anyone on your team who appears to be struggling. According to[ Deloitte](https://www2.deloitte.com/us/en/pages/about-deloitte/articles/burnout-survey.html), almost 70% of professionals feel their employers are not doing enough to prevent or alleviate burnout within their organization. And, very few offer any type of programs or initiatives to prevent or alleviate it. So, how can you help support your team? Here are some helpful ways you can help someone who feels stressed and close to burning out at work: **1\.** Give them the green light to step away from work and take time to rest and recharge. **2.** Listen to their concerns and offer support. **3.** Encourage them to prioritize self-care and make sure they’re taking care of themselves physically, mentally, and emotionally. **4\.** Lead by example. As a CFO, you can set an example by promoting a healthy work-life balance and encouraging self-care and well-being at work. **5\.** Provide your team members with resources, such as employee assistance programs, counseling services, or mental health days. **6.** Review workload and expectations to ensure they are manageable and realistic. **7.** Provide opportunities for growth and development to help your team stay engaged and motivated. **8.** Recognize and reward good work to show you appreciate your team. **9.** Create a positive work culture that prioritizes the well-being of employees and provides them with the support they need to de-stress. If you’re experiencing burnout, know that you’re not alone, and there *is* help available. Seek support from your colleagues, manager, friends, family, or a professional counselor, and take the necessary steps to take care of yourself. Remember, taking care of your well-being is not a sign of weakness, it's a sign of *strength*. --- **Join the Finance Alliance Slack Community** *Sign up for our free* [*Finance Alliance Slack community*](https://www.financealliance.io/community/) *and start networking with other CFOs and finance leaders today!* *Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.* [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### 12 of the best finance books for CFOs URL: https://www.financealliance.io/12-of-the-best-cfo-books-to-help-you-succeed-in-2023/ Last updated: 2026-03-11T11:30:33.000Z > *“Not all readers are leaders, but all leaders are readers.”* – Harry Truman The most successful CFOs are lifelong learners and loyal readers. They constantly invest time and effort in both their personal and professional development through educational content, courses, networking events, and yes, lots and lots of books. But what books do the most successful CFOs have on their bookshelves or stored in their Kindle libraries? And what titles should you add to your reading list in 2024? Take a seat and get comfortable as we reveal the 12 best CFO books to help you excel within your role. --- ### 1. *The 80/20 CFO* by Janice Berthold and Suzy Taherian ![The 80/20 CFO - cover image - best CFO books](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Screenshot-2023-01-16-at-14.38.06.png) [*The 80/20 CFO*](https://amzn.to/3Xnp7hg) is a must-read for any CFO who wants to create change within their organization. This book provides a fresh perspective on how CFOs can leverage the 80/20 principle to drive value for both themselves and their companies. The authors draw on real-world examples and their own experiences to offer practical advice and actionable strategies for CFOs that want to make a difference. You’ll also learn about some very useful shortcuts to help you earn credibility and trust. So, whether you're a seasoned finance veteran or a newcomer to the field, *The 80/20 CFO* is packed with actionable insights to help you lead strategic transformations in your company. [Grab your copy](https://amzn.to/3Xnp7hg) --- ### 2\. *The New CFO Financial Leadership* *Manual* by Steven M. Bragg ![The New CFO Financial Leadership Manual - cover image - best reads for CFOs](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/leadership.jpeg) If you want to stay ahead of the curve in today's fast-paced business environment, this is one of the best CFO books to add to your reading list in 2023. Written by one of the most respected experts in the field, [*The New CFO Financial Leadership Manual*](https://amzn.to/3QRsBqx) covers everything you need to know. From mastering financial analysis and forecasting to leading strategic initiatives and driving business growth, this book has it all. It also features a step-by-step guide to building a strong financial team, along with key insights to help you communicate effectively with stakeholders and leverage technology to drive efficiency and growth. [Grab your copy](https://amzn.to/3QRsBqx) --- ### 3\. *Atomic Habits* by James Clear ![Atomic Habits - cover image - great books for CFOs](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/atomic-habits.jpeg) With over 4 million copies sold, it’s not surprising that CFOs are loving this book, which promises ‘*tiny changes, and remarkable results*.’ [*Atomic Habits*](https://amzn.to/3W7Trvo) provides a fresh perspective on how small, incremental changes can lead to *big* results over time. Inside, you’ll unpack a powerful framework for creating and maintaining good habits, along with strategies for breaking bad ones. The book provides actionable advice on how to set clear goals, track progress, stay accountable, and how to make lasting changes that’ll improve your performance and help you achieve your biggest goals. [Grab your copy](https://amzn.to/3W7Trvo) --- ### 4\. *Reinventing the CFO* by Jeremy Hope ![Reinventing the CFO - cover image - CFO book](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/cfo-reinventing.jpeg) Another excellent book for CFOs who want to take their role to the next level, and become true strategic partners within their organizations, is [*Reinventing the CFO*](https://amzn.to/3GZJqfk). This great find offers a thought-provoking and insightful look at how the role of the CFO has changed over time. Hope also shares practical advice on how you can adapt to meet the challenges of today's business environment. > *“It’s time to redefine the role of CFOs in today’s organizations, liberating them from ineffective number-crunching responsibilities and enabling them to focus on helping managers improve performance.”* – Jeremy Hope [Grab your copy](https://amzn.to/3GZJqfk) --- ### 5\. *Dare to Lead* by Brené Brown ![Dare to Lead - Cover image - books for CFOs](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/dare-to-lead.jpeg) [*Dare to Lead*](https://amzn.to/3w1LZY6) is one of those books you won't be able to put down. Brown cuts the fluff and supplies a useful roadmap for developing the skills and mindset needed to lead with courage, vulnerability, and authenticity. CFOs are often required to lead teams and make tough decisions, and this book will teach you how to build trust, inspire others, and drive results. It also shares tips for managing difficult conversations and building a resilient mindset. A worthy title to feature on our best CFO books of 2023! [Grab your copy](https://amzn.to/3w1LZY6) --- ### 6\. *Principles* by Ray Dalio ![Principles - cover image](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/principles-cfo-books.jpeg) > *“Principles are fundamental truths that serve as the foundations for behavior that gets you what you want out of life.”* \- Ray Dalio In his book, Dalio shares his unique approach to decision-making, which he calls "[*Principles*](https://amzn.to/3ZJZb1w)", and how it has helped him build one of the most successful investment firms in the world. He also delves into how to develop a set of guiding principles for yourself, and how to apply them to achieve success. Discover how to create a culture of radical transparency and effective communication, which is key to driving a successful organization. [Grab your copy](https://amzn.to/3ZJZb1w) --- ### 7\. *Women CFO Stories* by Nidhi Agarwal ![Women CFO Stories - cover image - what books should CFOs read?](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/women-cfo-stories-1.jpeg) Written by Nidhi Agarwal, [*Women CFO Stories*](https://amzn.to/3CKGWz1) provides an in-depth look at the career journeys of some of the most accomplished women in the industry. It also explores how they've navigated the unique challenges and opportunities that come with being a woman in finance. With in-depth interviews with top female CFOs from a wide range of industries, each sharing their insights and experiences on topics such as leadership, mentorship, work-life balance, and overcoming biases and barriers, this is a CFO book with a difference. > *“While each person's circumstances are different, and their story won't be the same as anyone else’s, I hope by reading this book, every woman can understand that Ambition, Humility, Profession, and Prosperous family life can all co-exist!!”* – Nidhi Agarwal [Grab your copy](https://amzn.to/3CKGWz1) --- ### 8\. *Winning* by Jack and Suzy Welch ![Winning by Jack and Suzy Welch](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Screenshot-2023-01-16-at-14.47.06.png) Written by two of the most respected business leaders and management experts in the world, [*Winning*](https://amzn.to/3Wo71Lr) provides a comprehensive look at the key principles and practices that have guided the Welchs' successful careers and helped them drive growth and profitability for some of the world's largest companies. The Welch’s share their insights and experiences on how to build and lead high-performing teams, create and execute winning strategies, and drive innovation and growth. [Grab your copy](https://amzn.to/3Wo71Lr) --- ### 9\. *The Successful CFO* by Tony Tripodo ![The Successful CFO - cover image - CFO book list](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/successful-cfo.jpeg) Hands down, this has got to be one of the best CFO books for anyone who wants to become a dynamic and positive influence for their organization. [*The Successful CFO*](https://amzn.to/3QDNOnA) by Tony Tripodo offers a comprehensive look at the key principles and practices that are essential for CFOs to succeed in today's fast-paced business environment. Inside, you’ll find a wide range of topics that are crucial for CFOs, including leadership, strategy, financial analysis, and risk management. Tony shares his insights and experiences and reveals practical advice on what works and what doesn't work for a CFO to achieve success. [Grab your copy](https://amzn.to/3QDNOnA) --- ### 10\. *Competitive Strategy: Techniques for Analyzing Industries and Competitors* by Michael Porter ![Competitive Strategy: Techniques for Analyzing Industries and Competitors](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Kitap_2022092113473114064181.jpeg) Michael Porter provides a clear and practical guide for understanding the competitive forces at play and how to develop strategies that take advantage of them. He also shares how competitive advantage can be defined in terms of relative cost and prices, linking it directly to profitability. Many successful CFOs swear by Porter’s framework for predicting competitor behavior, which has transformed the way companies look at their rivals and has given rise to the new discipline of competitor assessment. > “Competitive Strategy has filled a void in management thinking. It provides an enduring foundation and grounding point on which all subsequent work can be built.” [Grab your copy](https://amzn.to/3WdDAeB) --- ### 11\. *The Lean CFO: Architect of the Lean Management System* by Nicholas S. Katko ![The Lean CFO - cover image - best CFO books](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/s-l500.jpeg) [*The Lean CFO*](https://amzn.to/3ZxBrNS) is all about how you can become a lean CFO by leading a company in developing and deploying a lean management system. It covers everything from lean accounting to performance measurement, strategic planning, and more. This book is not only a valuable resource for CFOs, but also for anyone looking to gain a deeper understanding of how to apply lean principles to the finance function and drive business success. [Grab your copy](https://amzn.to/3ZxBrNS) --- ### 12\. *The Alchemy of Finance* by George Soros ![The Alchemy of Finance - cover image](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/30566604511.jpeg) If you want to gain a deeper understanding of the principles and practices of successful investing and finance, this one is for you. Dubbed by BusinessWeek as "*the Man who Moves Markets*," Soros is one of the most successful and respected investors in the world. In his book, he presents a theoretical and practical account of current financial trends and a new paradigm by which to understand the financial market today. [*The Alchemy of Finance*](https://amzn.to/3w1a69u) stands out from most CFO books because it features expert advice and valuable business lessons, revealing the timeless principles of an investing legend. > *"An extraordinary inside look into the decision-making process of the most successful money manager of our time. Fantastic."* \- The Wall Street Journal [Grab your copy](https://amzn.to/3w1a69u) --- ## CFO Book Club📚 Whether you're a seasoned CFO or an aspiring one, the [CFO Book Club](https://www.financealliance.io/cfo-book-club/) is for you! Join like-minded finance professionals who come together each month to expand their knowledge and discuss thought-provoking books. But it's not just about reading. We bring in top authors and industry experts for live Q&A sessions, so you can learn from the best and get your burning questions answered. ### What is big data security analytics? URL: https://www.financealliance.io/what-is-big-data-security-analytics/ Last updated: 2024-06-20T11:46:28.000Z Big data security analytics is something that’s becoming increasingly important in finance, which isn’t a surprise considering today’s digital landscape. Now, more than ever, organizations are facing a constant wave of security threats. From network intrusions and malicious insider activity to data breaches and compliance violations, the risks to a company’s sensitive data are at an all-time high. So, how can you protect data from theft and other malicious threats? Keep reading to find out how to detect and respond to security threats and how you can implement cybersecurity measures to protect sensitive financial data. We also dive into: - [Big data’s role in finance](https://www.financealliance.io/p/c299d7a6-38e5-4689-85f9-94e41eaea1b5/#big-data%E2%80%99s-role-in-finance) - [What is big data security analytics?](https://www.financealliance.io/p/c299d7a6-38e5-4689-85f9-94e41eaea1b5/#what-is-big-data-security-analytics) - [How to leverage big data security](https://www.financealliance.io/p/c299d7a6-38e5-4689-85f9-94e41eaea1b5/#how-can-you-leverage-big-data-security-analytics) - [How to get started with big data in the finance function](https://www.financealliance.io/p/c299d7a6-38e5-4689-85f9-94e41eaea1b5/#how-to-get-started-with-big-data-in-the-finance-function) ## **Big data’s role in finance** Before we dig into the security analytics side of big data, let’s take a moment to clarify what we mean by ‘big data.’ Put simply, big data in finance refers to large and diverse sets of financial data that are used to gain a competitive advantage and offer solutions to business challenges. ## **What is big data security analytics?** Big data security is the process of using advanced analytics techniques, like machine learning and data mining, to analyze large volumes of data and protect it from theft, attacks, and other malicious activities. Keeping data safe is so important, especially if your organization stores sensitive or confidential information, such as credit card numbers, contact details, and other personal details. From a financial perspective, a malicious cyber-attack can wreak havoc and lead to losses, fines, sanctions, and litigation costs. If your data is at risk, the faster you detect and respond to the threat, the better. With the right cyber-security measures, you can automate the process of finding patterns and anomalies in data that could indicate a security breach – and then take action before it gets out of hand. --- [Robotic Process Automation in Finance: 5 benefits of RPAIn this post, you’ll find out how to use RPA to streamline financial processes. We’re also sharing five amazing benefits of using automated RPA software.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/robotic-process-automation-in-finance-2.jpg)](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) --- ## **How can you leverage big data security analytics?** By leveraging big data security, you can gain a more comprehensive understanding of the potential risks and threats facing the organization. But how can you lean on this type of security to protect sensitive financial information? Here are a few of the most common ways modern finance functions leverage [big data security analytics](https://www.financealliance.io/from-data-driven-to-ai-powered/): 1. **Fraud detection and prevention** – Finding patterns and anomalies in financial transactions that may indicate fraudulent activity. 2. **Compliance management** – Monitoring and detecting potential compliance violations, such as those related to anti-money laundering (AML) and know-your-customer (KYC) regulations. 3. **Cybersecurity** – Detecting and responding to possible cybersecurity threats like network intrusions and phishing attacks. 4. **Insider threat detection** – Spotting malicious activity from the inside, such as insider trading or data breaches. 5. **Risk management** – Identifying potential risks to the organization and informing risk management strategies. ![Big data security analytics and cyber security in finance](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/cyber-security-g02edfc7a1_1920-2.jpg) ## How to get started with big data in the finance function Implementing big data security sounds a lot more intimidating than it is. One of the most common security tools is encryption, which requires a key to unlock the encrypted data and makes it extremely difficult for hackers to access. Another useful way to protect data is with a solid firewall, which filters all traffic that enters and exists on the server. Firewalls can help prevent attacks by eliminating third parties and other unknown and potentially harmful data sources. When considering data security measures, keep these three concerns top of mind: 1\. Incoming data 2\. Data in storage 3\. Outputted data The data security software you choose must be able to effectively protect data throughout the organization, whether it’s being inputted, outputted, or stored. It’s also important to keep in mind that while big data security analytics can be a powerful tool for organizations to improve their security posture, it also has its limitations. --- [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) --- Some pros and cons to consider include: ### Pros: - Improved fraud detection and prevention - Better compliance management - Enhanced cybersecurity - Advanced insider threat detection - Enhanced risk management ### Cons: - High cost of implementation - Complexity - Data quality and accuracy - Privacy concerns - False positives and false negatives To get the most value from big data security analytics, the data must be clean, well-structured, and accurate. It’s also worth establishing both data governance and data quality standards to help make sure the data is prepared correctly. This involves data cleaning, transformation, and integration. You should also identify the specific business objectives that you (and senior management) hope to achieve with this technology. Is the main objective to detect and prevent fraud? Improve compliance management? Or do you simply want to enhance the company’s cybersecurity efforts in general? Keep the objectives top of mind when choosing what tools to implement. We recommend looking for platforms that are easy to use, integrate well with existing systems, and are customizable to specific requirements. ### Final thoughts It's important to have realistic expectations and to weigh the potential pros and cons before deciding to introduce this type of cybersecurity. With the right approach, however, big data security analytics can be a valuable tool for finance teams to improve their organization's security posture and protect sensitive financial information. --- **Download our** [**State of Finance Transformation Report**](https://www.financealliance.io/state-of-finance-transformation-report-2022/) **and learn more about the real impact of technology and AI in finance!** [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/01/FA_State_of_Finance_Transformation_Report_2022_CTA.jpg) ](https://www.financealliance.io/state-of-finance-transformation-report-2022/) ### What is cash flow-based financial planning? URL: https://www.financealliance.io/what-is-cash-flow-based-financial-planning/ Last updated: 2023-01-11T16:40:47.000Z Financial planning is vital for organizations that want to cement their success and ensure their future is a bright one. Many argue that cash flow based financial planning is the most effective way to plan and manage resources by focusing on the amount of cash coming in and going out of a business. But why is the cash flow-based approach to financial planning so important? And what does it involve? Keep reading to uncover the answers to both of these questions and more… **Topics covered in this article:** - [What is cash flow-based financial planning?](https://www.financealliance.io/p/208c6b49-13fa-43f8-ab8f-a0d1f65f0ec3/#what-is-cash-flow-based-financial-planning) - [The benefits of cash flow-based financial planning](https://www.financealliance.io/p/208c6b49-13fa-43f8-ab8f-a0d1f65f0ec3/#what-are-the-benefits-of-cash-flow-based-financial-planning) - [What you need to create a cash flow plan](https://www.financealliance.io/p/208c6b49-13fa-43f8-ab8f-a0d1f65f0ec3/#what-do-you-need) - [The process of this type of financial planning](https://www.financealliance.io/p/208c6b49-13fa-43f8-ab8f-a0d1f65f0ec3/#what-is-the-process-of-cash-flow-based-financial-planning) - [How to improve the accuracy of your plans](https://www.financealliance.io/p/208c6b49-13fa-43f8-ab8f-a0d1f65f0ec3/#how-to-improve-the-accuracy-of-your-cash-flow-plans) ## **What is cash flow-based financial planning?** Cash flow-based financial planning focuses on managing a business's cash inflows and outflows to achieve financial stability and meet financial goals. Sounds fairly simple, right? Well, it is… except it requires more precise data than, say, goals-based planning, which identifies financial goals, assesses the existing financial situation, and develops a plan from there. Goals-based planning is often better suited for individuals, whereas cash flow-based financial planning caters to businesses. Cash flow-based financial planning forecasts future cash flows, which involves analyzing current and expected expenses, and identifying potential sources of income. The main goal of this type of financial planning is to ensure that there’s sufficient cash available to meet short-term and long-term financial obligations. It’s also used to help take advantage and seize opportunities to cut costs and increase profits. When done right, this type of financial planning helps businesses manage finances more effectively, providing a clear understanding of the business’s financial situation. In turn, this helps members of the C-Suite (such as the CEO and CFO), make informed decisions about how to best allocate company resources. [7 cash flow management strategies for busy finance teamsHow can you make sure that your cash flow management strategy is a booming success? In this article, we share seven simple but effective cash flow management strategies for busy finance teams...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/cash-flow-management-strategies.jpeg)](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) ## **What are the benefits?** There are several benefits to using cash flow-based financial planning to forecast and manage the amount of cash coming into and going out of the business, including: - Improved cash management - Enhanced flexibility - Better decision-making - Smarter risk management - Better management of cash reserves - Increased ability to borrow - Improved financial stability - Increased profitability ## **What do you need?** A cash flow plan outlines a business’s expected cash inflow and outflow over a set period of time, but what do you need to create one? Here are some key elements to create a solid cash flow plan for a business: **Financial statements** You’ll need to gather and review the business's financial statements. This means getting your hands on the company’s income statements and balance sheets to get a clear picture of its current financial status. **Budget** A budget will help you forecast future cash inflow and outflow by projecting revenues and expenses. **Cash flow projections** You’ll need to create detailed projections that include the business's current financial status, budget, and any anticipated changes in [cash flow](https://www.financealliance.io/7-benefits-of-a-cash-flow-forecast-to-drive-sustainable-business-growth/). **Break-even analysis** A break-even analysis helps you determine the point at which the business will start generating positive cash flow. **Sales forecast** A sales forecast anticipates future revenue and makes more accurate cash flow projections. **List of all sources of income and costs** If you want to develop a complete picture of how money flows into and out of the business, you’ll need to identify all of the company’s sources of income and costs. **Projected timelines** It's important to set the right timeline for each step of the cash flow plan to effectively track progress and make any necessary adjustments. **Contingency plan** A contingency plan will help you prepare for unexpected changes in finances. It'll also make it easier to mitigate any potential negative effects on the business. **Communication and collaboration** To effectively manage cash flow, it's important to involve all relevant stakeholders in the cash flow planning process, including management, finance and accounting, and any external financial advisors. **Regular monitoring and updating** Finally, the cash flow plan should be regularly monitored and updated to ensure that it remains accurate and effective in helping the business manage its finances. Having all this information together in a comprehensive and easy-to-understand format puts you (and senior management) in the best position to make the right decisions for the business and to make sure it’s always on a good financial footing. ## **What is the process of cash flow-based financial planning?** The process of this type of financial planning involves collecting and analyzing financial data, forecasting, developing, and implementing a plan to manage resources, and monitoring the plan to ensure its success. Although the process may differ from company to company, there are a few similar steps that most finance teams take when developing a cash flow plan: **Step 1\. Gathering information** The first step is to gather all relevant financial and operational data. Make sure you have all of the information ready and waiting, such as data about the company's income, expenses, assets, and liabilities. This can include data on sales and revenue, costs of goods sold, operating expenses, and other key financial metrics. **Step 2\. Forecasting cash flow** Once the necessary data has been collected, the next step is to use it to forecast the company's predicted finances for a specific period of time, such as the next year or even several years into the future. This can be done using a variety of forecasting techniques, like financial modeling or scenario analysis. **Step 3\. Developing a plan** Based on the forecast, you can then develop a plan for managing the company’s financial resources. This usually involves identifying areas where the company can reduce costs or increase revenues, as well as identifying opportunities for investment or expansion. **Step 4\. Implementing and monitoring the plan** The final step is to implement the plan and monitor its performance. You can do this by regularly reviewing financial reports and adjusting the plan as needed. [How to instantly improve cash flow forecasting techniquesWhen done well, a cash flow forecast will accurately estimate money flowing in and out of the business over a set period of time. If you want to improve your cash flow forecasting techniques, keep reading to discover five tips to help you do just that.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/cash-flow-forecasting-methods-header-image.jpeg)](https://www.financealliance.io/5-ways-to-instantly-improve-cash-flow-forecasting-techniques/) ## **How to improve the accuracy of your cash flow plans** Financial planning is an important part of financial management for businesses of all sizes. By creating and regularly reviewing a cash flow plan, you can identify potential issues and take steps to address them *before* they become serious problems. If you want to create better cash flow plans, you must set a realistic budget. Don’t over or underestimate how much money is available. Instead, create a budget that accurately reflects the business's expenses and income. You also need to monitor cash flow regularly. Don’t create a plan only to put it aside until the next reviewing stage. Keep track of the company’s financial health on a regular basis, such as weekly or monthly. This will allow you to identify any potential issues early on and take action to address them. If the business is struggling finanically, look for ways to increase revenue, such as by expanding your product or service offerings or finding new customers. Finally, remember to plan for seasonal fluctuations. If your business experiences fluctuations in cash coming in and out of the business due to the seasonality of your industry, make sure to plan ahead and have a strategy in place to manage those fluctuations. --- **Join the Finance Alliance Slack Community** *Sign up for our free [Finance Alliance Slack community](https://www.financealliance.io/community/) and start networking with other CFOs and finance leaders today!* *Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.* [Sign up](https://www.financealliance.io/community/) ### "I appreciate having the opportunity to get great feedback from finance professionals" - Julio García, J&C Financial URL: https://www.financealliance.io/julio-garcia-case-study/ Last updated: 2023-01-09T11:31:13.000Z [Julio García](https://www.linkedin.com/in/senior-financial-jcga/) is the CEO and Founder of J&C Financial, where he is currently forging a new initiative developing his financial consulting firm, acting in the roles of CFO and FP&A for Mexico. Alongside running his own consultancy, Julio is a Senior Associate Public Accountant of the IMCP (Mexican Institute of Public Accountants) as an independent professional serving the collegiate in matters of SME Consulting and Consulting for Individuals. Julio is also an active member of the [Finance Alliance Slack community](https://www.financealliance.io/community/), a supportive, informal, and inspirational space where finance leaders can gather and discuss with like-minded people. From sharing ideas to offering advice to your peers, our Slack community is the ultimate space for finance pros who want to accelerate their careers. In this case study, Julio shares his thoughts and experience as an active member of our community: ### What was your motivation for joining the Finance Alliance Slack community? Business units need leaders with a global vision. Sharing experiences in a transcendental way has a great impact to help us learn from others within the community. I also appreciate having the opportunity to get great feedback from financial professionals from global sectors. ### What are the main benefits of being in the Slack community? I can summarize three competitive advantages: 1. The platform is very user-friendly and segregated according to the Finance Alliance's mission. 2. The synergy starts as soon as we accept the emotion of sharing our experiences and the novelty that is workable for each position and in each situation. 3. Self-directed networking is exciting. [Case Study | FP&A Summit Virtual Event | Finance AllianceIn November 2022, Bruno attended our FP&A Summit, a virtual event designed to keep finance professionals ahead of trends and arm them with the skills they need to drive their business and career forward.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/2-1.png)](https://www.financealliance.io/how-was-your-experience-at-the-fp-a-summit/) ### What have you enjoyed most since joining? The [content](https://www.financealliance.io/articles/), the topics of interest, and the recent [FP&A Summit](https://summit22.financealliance.io/?%5Fgl=1%2A13wk4at%2A%5Fga%2AMTYxNzU4NjkxLjE2NzI3Mzk5MDI.%2A%5Fga%5F2NXFSBEP4N%2AMTY3MzI1OTYwNC4yMC4xLjE2NzMyNjI4NTkuMC4wLjA.). ### What type of discussions have you found the most insightful and useful? The synergy of roles, the strategic planning regarding some of the content items of good management, and the use of money over time. Of course, all of this adds to what I have experienced objectively. ### What type of resources have you found the most helpful? CFO & FP&A Content. I have also built up connections with the excellent Finance Alliance team. ### What key outcomes have there been for you? Tips and scenarios that add up to my perspective, improving it globally. ### Why should other finance professionals join the community? To be different, we have to get out of the comfort zone of the region to which we belong. The industry and external factors require us to make better decisions and to be open to other perspectives. ### About Julio In the last 12 years, Julio (Mexican nationality) became a senior business partner in the management of the transnational BOSKALIS, a leader in the international maritime construction of complex projects. With a history of working in the corporate world, supporting management on strategic and operational issues, Julio has had a number of roles from Project Accountant, Accounts Payable Specialist, Sr. Financial Accountant, Accounts Payable Leader in Mexico to Regional Treasurer in Mexico, Central America, and the Caribbean. Julio is spontaneous, collegial, takes initiative, is hands-on, analytical, and precise in his work. He has the ability to look beyond the question at hand. He likes to connect in teams with problems and projects to find the best solution. His mission has been to contribute to his organization and help bring it to the next level. Always collaborating as a team to achieve synergy between his area and others, to be part of the same goal, and assuming the commitments of the organization with conviction and professionalism. --- ### Join the Finance Alliance Community Sign up to our free Finance Alliance Slack community and start networking with other CFOs and finance leaders. Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. So, what are you waiting for? [Sign up today](https://www.financealliance.io/community/)! (it’s free) [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### What is finance transformation? URL: https://www.financealliance.io/what-is-finance-transformation/ Last updated: 2023-01-05T14:18:23.000Z The role of finance within organizations is changing. Gone are the days when you spent most of your time manually inputting data into spreadsheets (*yawn!*). Thanks to new technologies, many of the most tedious and mundane tasks can be (or have been) automated. Finance can now step up and offer its unique expertise to influence better-informed decisions that help drive the business forward. But what is finance transformation? And why is it so important to modern CFOs and their teams? In this article, we’re diving into what finance transformation means, the key drivers of it, and why it’s something that needs to be on your radar in 2023 and beyond. **Topics covered:** - [What is finance transformation?](https://www.financealliance.io/p/6d925860-4039-487d-b55e-ffc66cf3e442/#what-is-finance-transformation) - [Why is finance transformation so important?](https://www.financealliance.io/p/6d925860-4039-487d-b55e-ffc66cf3e442/#why-is-finance-transformation-so-important) - [10 Key drivers of digital transformation.](https://www.financealliance.io/p/6d925860-4039-487d-b55e-ffc66cf3e442/#what-is-finance-transformation-10-key-drivers) - [Finance transformation progress within organizations.](https://www.financealliance.io/p/6d925860-4039-487d-b55e-ffc66cf3e442/#finance-transformation-progress-within-organizations) - [Budgeting for finance transformation.](https://www.financealliance.io/p/6d925860-4039-487d-b55e-ffc66cf3e442/#budgeting-for-finance-transformation) ## **What is finance transformation?** Finance transformation refers to tactical initiatives that help transform the finance function by assessing and improving its strategy, vision, processes, and systems to better align with the company’s overall strategy. Finance transformation is evolving exceptionally fast, and things have escalated that much faster (and further) since the dawn of COVID-19. The pandemic saw a spike in demand for more effective and efficient ways to complete repetitive and mundane tasks. From collecting data business-wide to automating daily processes, finance transformation has proven to generate positive change across the entire organization. Suddenly, finance professionals are no longer siloed to adding numbers to lengthy spreadsheets. Those days are a thing of the past. Or at least they *can* be if your organization invests in new technologies to help streamline existing processes and ease the workload. [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) ## **Why is finance transformation so important?** It’s the question on top of everyone’s minds, so let’s address it. Why should finance professionals care about implementing technology at all? And why is it so important? [Finance transformation](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) is important for several reasons. It can help organizations improve the efficiency and effectiveness of their financial operations, which can lead to cost savings and increased profitability. It can also help organizations better understand and manage their financial performance, which can inform decision-making and strategy. Additionally, finance transformation can help organizations adapt to changing business environments and regulatory requirements and can position them for future growth and success. In our recent State of Finance Transformation Report 2022, we asked a few finance experts to share their thoughts on why more finance teams need to become advocates for finance transformation within their organizations. Here’s what they had to say: ![What is finance transformation - Tjendra Halima quote](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Screenshot-2023-01-04-at-16.47.24.png) ## **What is finance transformation: 10 Key drivers** What drives interest in adopting new technologies within the finance function? To find out, we asked finance professionals to identify the main drivers of finance transformation in their organizations. Here are 10 key drivers of finance transformation within organizations (ranked according to the results from our *[State of Finance Transformation Report 2022](https://www.financealliance.io/state-of-finance-transformation-report-2022/)*): 1\. The desire for more efficient processes 2\. Improved controls 3\. Improved reporting and stakeholder visibility 4\. Meeting customer demands 5\. Pressure to digitalize finance processes 6\. Increased business complexity 7\. Shorten cash cycles 8\. Globalization 9\. Uncertainty 10\. Need for supplier integration ## **Finance transformation progress within organizations** A successful finance transformation journey takes more than blindly investing in some jazzy new technology. You won’t get very far without a clear plan and long-term strategy in place. The good news is that it looks like most of our respondents are taking a strategic approach to finance transformation with 70.4% reporting that their organization has a specific strategy in place, while 29.6% said that a strategy was absent. [Robotic Process Automation in Finance: 5 benefits of RPAIn this post, you’ll find out how to use RPA to streamline financial processes. We’re also sharing five amazing benefits of using automated RPA software.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/robotic-process-automation-in-finance-2.jpg)](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) ### Who oversees finance transformation? We were keen to find out who, if anyone, was responsible for implementing finance transformation. Do companies hire roles dedicated to finance transformation? Or, is somebody else or an entire team responsible for identifying which technology to use, who gets to use it, and to what capacity? We weren’t overly surprised to see that 74.1% of respondents reported that the Chief Financial Officer (CFO) is the one who oversees finance transformation in the workplace. However, 40.7% said that their company has hired a designated finance transformation role, while 37% reported that the finance team had been given full control over how they want to leverage technology. ![State of Finance Transformation report graphic](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Screenshot-2023-01-04-at-16.47.39.png) The results showed that finance transformation is typically overseen by senior finance leaders, such as the Chief Financial Officer (CFO) or other members of the C-suite. These leaders are responsible for identifying the need for financial transformation, developing a plan to implement it, and ensuring that it is carried out effectively. They may work with other members of the finance team, as well as external consultants, to implement changes to processes, systems, and organizational structures. Depending on the scope of the transformation, other stakeholders within the organization, such as the CEO, board of directors, and business unit leaders, may also be involved in overseeing the process. ### Why do some companies fail? When digital transformation fails to meet expectations, it’s usually not because of the new technology itself, but how that new technology was onboarded. After all, if the people using the technology don’t know how it works or are unsure of the answer to the question - *what is finance transformation?* \- what’s the point? We wanted to find out just how ‘ready’ finance professionals are for this new wave of technology we’ve seen flooding through the gates of finance departments from around the world. We asked our survey respondents to rate not only their knowledge of technology in finance but their entire finance team’s knowledge of what finance transformation means and to see if there’s an evident training gap when it comes to adopting new technology. 59.3% of finance professionals surveyed rated their knowledge as average, while 18.5% rated their knowledge as poor. On the bright side, 14.8% considered themselves to be technology experts. ![What is finance transformation? - Stats from the State of Finance Transformation report](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2023/01/Screenshot-2023-01-04-at-16.48.06.png) ## **Budgeting for finance transformation** How much does it cost to invest in the best technology to streamline financial processes? And how much of a company’s budget is going towards finance transformation? According to 77.8% of finance professionals surveyed, between 0% – 25% of the overall company budget is set aside for technological investments that could benefit them within their roles. 14.8% of respondents reported that their companies allocated between 26% – 50% of the budget to finance transformation and only 7.4% reported over 50% of the company’s budget is invested in technology for the finance function. ### Can technology impact the bottom line? Yes, finance transformation can potentially impact business profits in several ways. By improving the efficiency and effectiveness of financial operations, an organization may be able to reduce costs and increase profitability. For example, if a company can streamline its billing and collection processes, it may be able to reduce the amount of time and resources it spends on these activities, which could lead to cost savings. --- **Want to see more key findings from the [State of Finance Transformation Report](https://www.financealliance.io/state-of-finance-transformation-report-2022/)?** **Grab your copy today and discover the real impact of finance transformation on not just organizations, but the everyday life of finance pros like you!** [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2023/01/FA_State_of_Finance_Transformation_Report_2022_CTA.jpg) ](https://www.financealliance.io/state-of-finance-transformation-report-2022/) ### How the rise of super apps is impacting banking and FinTech URL: https://www.financealliance.io/podcast/how-the-rise-of-super-apps-is-impacting-banking-and-fintech/ Last updated: 2023-01-04T11:44:43.000Z What are super apps, and how are they impacting banking and FinTech on a global scale? In this episode of the Two Cents: Finance Talk podcast, Xavier Gomez, the COO and Co-Founder of INVYO, guides us through the rise of the super app and how this up-and-coming trend will impact the finance industry. You can listen to the full episode below: Or, if you prefer, keep reading to learn more about super apps. Xavier covers topics such as: - [What makes an app ‘super’ and the definition of a super-app](https://www.financealliance.io/p/fdb54f8d-d472-4714-95c1-141c32e8bbaa/#q-what-makes-an-app-%E2%80%98super%E2%80%99-and-what-exactly-are-super-apps) - [The rise of super-apps in Asia and whether the US and Europe will also jump on this trend](https://www.financealliance.io/p/fdb54f8d-d472-4714-95c1-141c32e8bbaa/#q-do-you-think-that-we-have-seen-the-absolute-rise-of-super-apps-in-asia-do-you-think-the-us-and-europe-will-jump-on-the-trend-as-well-or-are-they-too-late) - [How fintech companies and banks will be affected by super-apps](https://www.financealliance.io/p/fdb54f8d-d472-4714-95c1-141c32e8bbaa/#q-what-does-the-rise-of-super-apps-mean-for-fintech-companies-and-banks-what-will-the-potential-challenges-be) ## Q: What makes an app ‘super’ and what exactly are super-apps? The definition of a super app is pretty simple. It’s a single application with multiple functions, often supported by a payment system from the same company. This concept came from Asia, specifically China. While mobile users typically use dedicated apps for specific tasks, mobile users in the Asia-Pacific region are accustomed to performing multiple functions, often seemingly unrelated to a single super app. For example, WeChat, developed by Tencent, is a classic example of a super app. Aside from its basic function of sending messages, WeChat can also be used to order food, call taxis, and book plane tickets. Tencent doesn’t offer these additional services itself but instead allows third-party companies to build apps in WeChat. Officially called mini programs in China, these apps within an app allow mobile users to use services from third-party companies without downloading a separate app. WeChat now acts as its own operating system and reached over 1 million mini-programs in November 2018. Another big player in this space is Alipay, which is the closest competitor to WeChat with more than 130,000 mini programs. Other successful super apps in China which use the mini program model include Baidu, the Chinese search engine, Meituan, which provides online catering, and Taobao, the C2C and B2C online shopping platform from Alibaba. This is an extremely interesting creation in terms of user experience, as super-apps go across eCommerce, mobile apps, and FinTech payments. Previously, most people predicted that the use of super-apps would be confined to Asia and we would never see them used in developed countries. But after COVID-19, we saw big developments in super-apps through a number of different players around the world, especially in Europe. [FinTech Trends 2023 | Finance AllianceWhat does the future hold for FinTech?In this post, Xavier Gomez, the COO and Co-Founder of INVYO, shares his top 3 predictions for FinTech Trends in 2023.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/FA-2-Cents-Podcast---Meta-2.png)](https://www.financealliance.io/podcast/fintech-trends-2023-top-trends-future-predictions-for-fintech/) ## Q. Do you think that we have seen the absolute rise of super apps in Asia? It depends on which way you look at it in terms of consumption. For me, this is clearly the start of the awakening of super apps in Europe and the US. In terms of players, Chinese players are currently more advanced than others. For example, in France, you have Lydia, which is a non-financial institution with 7 million clients and users. They have apps you can use for retirement savings, payments, financial banking, and so on. But in comparison, Chinese players have up to 300 million customers, which is a significantly larger amount. I can see super apps being developed in the US and Europe because customer data is becoming more important to control and understand. For traditional companies and startups leveraging super-apps, the customer data collected is of very high quality, in particular with integrated payments. This makes it possible to obtain key information such as the frequency of purchases, what customers buy, why they buy certain products etc. It's massively helpful in gaining knowledge of your customers and clients. Privacy is a big issue in adopting super apps, as this is more regulated in the West than in the Pacific region. Integrating multiple services into a single app raises concerns about the processing of storage and use of personal data for which Meta and Google are already under huge scrutiny by different regulators around the world. Cultural differences are also a huge deterrence to the super-app model globally. Super-apps are used in culturally close regions such as China, India, and South Asia. Uber Technologies recognized this problem when expanding into emerging markets. They didn’t incorporate more functions into their app, but instead split into separate, less cultural apps such as Uber Lite in India, and Uber Bus in Egypt. [AI in banking | Finance AllianceWith AI in banking having the potential to offer up to $1 trillion of additional value each year, it becomes paramount to have a strong cloud architecture while still understanding customer needs. In this article, we’ll take a look at AI in banking...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceMarisa Garanhel![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/AI-in-banking.jpg)](https://www.financealliance.io/ai-in-banking/) ## Q. What does the rise of super-apps mean for fintech companies and banks? It depends on the innovation policy inside the banks. As many know, today’s banks have a problem with IT legacy infrastructure and agility compared to tech companies and startups. I think the best strategy for banks to adopt this kind of service is by applying competition. This means that banks will have to accept the competition of other players such as non-financial payers or fintech, and they'll have to cooperate with them in order to innovate and learn from this kind of partnership. For me, this is the only way for traditional banks to move forward and survive. This is because they have a lot of regulations in place to stay compliant, they spend a lot of money in terms of working capital on financial markets, and they have to invest a lot of money in innovation structures. And without any help from big startups or tech companies, they'll really struggle. ### AI in banking URL: https://www.financealliance.io/ai-in-banking/ Last updated: 2022-12-29T11:43:33.000Z From [artificial intelligence in manufacturing](https://www.aiacceleratorinstitute.com/artificial-intelligence-in-manufacturing/) to marketing and other industries, automating processes has proven to help businesses in decision making. Banking is no different; with deep learning and machine learning paving the way for better customer service and lower operational costs, it’s no wonder that banking services are increasing their use of AI tools. With [AI in banking having the potential to offer up to $1 trillion](https://www.mambu.com/gcp-bank-of-the-future) of additional value each year, it becomes paramount to have a strong cloud architecture while still understanding the customer needs, so that services can be delivered at scale and extremely personalized. In this article, we’ll take a look at AI in banking, namely: - [Best practices](https://www.aiacceleratorinstitute.com/ai-in-banking/#best-practices-for-ai-in-banking) - [Its applications](https://www.aiacceleratorinstitute.com/ai-in-banking/#ai-applications-in-banking) - [Benefits](https://www.aiacceleratorinstitute.com/ai-in-banking/#benefits-of-ai-in-banking) - [What the future brings](https://www.aiacceleratorinstitute.com/ai-in-banking/#future-of-ai-in-banking) ## **Best practices for AI in banking** ### **Step 1: Knowing your business needs** By understanding the specific problem you want AI to help solve, you’ll be able to pinpoint what tools will be more beneficial. Sometimes adding a chatbot as part of customer service can be what's needed to lower costs and increase customer satisfaction. ### **Step 2: Defining how the data will be handled** Banking produces large amounts of data, and knowing how your business will analyze, clean, extract, and centralize it is essential. ### **Step 3: Giving AI models time to learn** With any AI technology, it’s essential that tools have enough time to learn what’s needed of them so they can deliver the best results. Models need to be fed historical data so they can train themselves, which can be time-consuming if you’re starting from scratch. ### **Step 4: Automation of testing** AI models need to perform continuous testing, to make sure that results continue to be accurate. Errors in data analysis can lead to bigger issues in your business, either short or long-term, so it’s imperative that you have a system in place to always have your models learning. [Robotic Process Automation in Finance: 5 benefits of RPAIn this post, you’ll find out how to use RPA to streamline financial processes. We’re also sharing five amazing benefits of using automated RPA software.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/robotic-process-automation-in-finance-2.jpg)](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) ## **AI applications in banking** ### **Predictive analytics** With AI being able to detect patterns and make correlations in data, its general-purpose natural language and semantic applications mean it’s ideal for predictive analysis. Patterns AI can detect are often cross-selling opportunities, potential sales opportunities, and operational data metrics. ### **Chatbots** Chatbots are extremely common across all industries, as they can deliver a high return on investment (ROI) by saving on costs. They can help with frequently asked questions like fund transfers or balance inquiries, which frees up human employees and reduces workloads in other channels. ### **Credit scoring and direct lending** Deciding whether clients are creditworthy through the analysis of data from both traditional and non-traditional sources is something AI is helping alternate lenders with. This leads to the creation of innovative systems based on a strong credit scoring model, aiding individuals with a limited credit history. ### **Cybersecurity** By leveraging data from previous security threats and learning indicators of potential attacks, AI can help prevent external threats in banking and finance. Additionally, it can also monitor potential internal security risks and offer suggestions on how to correct them, to prevent data theft. ### **Customer onboarding** Onboarding customers can be challenging, as it’s still document-heavy, and banking services still require undertaking a series of identity checks. AI tools can streamline the onboarding process through document-uploading-automation, facial recognition, or using Optical Character Recognition (OCR) in order to pre-populate data in applications. [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) ## **Benefits of AI in banking** ### **1\. Regulatory compliance** Compliance rules can change regularly as the industry develops, and banking services need to be able to reassure customers that they’re being supported under existing regulations. Customer data protection is something all banking services require, and AI tools can significantly help detect suspicious activity, whether that’s hackers or phishing. ### **2\. Minimized operational costs** Automation in workflows, with the use of natural language processing and machine learning, for example, helps in the operation of repetitive tasks that human employees would potentially not perform as accurately as a machine. Ensuring minimal errors helps to lower operational costs. Having 24/7 customer support through chatbots has increased banking services’ reliability and credibility, as customers can have quick access to basic information they would otherwise have to spend time on the phone for or go in-branch. ### **3\. Improved customer service** Alongside chatbots improving the customer experience, AI apps have also helped banking services by adding value and increasing customer retention. These apps allow customers access to their bank accounts on public holidays and weekends, where otherwise banks, for example, would ordinarily close. ### **What value can be added throughout the banking chain?** ****Front line** - Marketing 1\. Customer analytics and targeting 2\. Customer engagement 3\. Customer profiling - Products and services 1\. Lending 2\. Trading 3\. Product advisory 4\. Investment portals 5\. Financial advice 6\. Payment initiations 7\. Account management - Sales and relationships 1\. Automated reconciliation 2\. Know Your Customer (KYC) solutions 3\. Risk management and credit scoring ****Mid office** - Operations 1\. Analytics and research 2\. Compliance 3\. Process automation solutions 4\. Authentication and identity verification ****Back office** - Performance management 1\. Cybersecurity 2\. Predictive recruitment - Risk servicing 1\. Early warning systems 2\. Fraud monitoring and detection [5 tips for CFOs to accomplish finance digital transformationAs the CFO, you’ll lead the charge for finance digital transformation within the organization. But doing so takes some work. Here are 5 ways CFOs can drive finance digital transformation, optimize business processes, and even enhance overall profitability.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/finance-digital-transformation.jpg)](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) ## **Future of AI in banking** Juniper Research states that, by 2024, there will be over [3.6 billion users](https://www.businesswire.com/news/home/20200302005659/en/Juniper-Research-Digital-Banking-Users-to-Exceed-3.6-Billion-Globally-by-2024-as-Digital-Only-Banks-Catalyse-Market) of digital banking services - a 54% increase from 2020\. Digital-only banks and the current digital transformation that’s being seen across the sector are behind this expected increase. But how are digital-only banks growing so quickly? According to the study, these digital-only services have tightly focused USPs and offer a superior user experience compared to traditional services. The latter must increase their digital offering to remain competitive, which is often represented by providing an excellent balance between human engagement and digital tools. Combining customer knowledge with AI tools will lead to more personalized experiences, regardless of customers’ chosen channels. Having a clear data strategy, reimagining operating models, investing in a strong and modern tech core, and building AI use cases are essential for banking services to future-proof themselves. In addition to using data to offer personalized and intelligent engagements, banking services will also need to improve their back-office operations, innovation processes, and decision-making. --- **Want to learn more about how finance has embraced technology?** ****Download [The State of Finance Transformation Report](https://productmarketingall.typeform.com/to/f5Yjq66a) 2022 and find out:** 💡 Where finance transformation is ****now**. 🔑 ****Key drivers** of finance transformation. 💰 The positive impact of ****automation in finance**. 🤔 ****Common challenges** and how to overcome them. ⚒️ How to develop a ****culture of change**. 🔮 What a ****successful adoption** of finance transformation looks like. [Get your copy](https://www.financealliance.io/state-of-finance-transformation-report-2022/) ### How to make your data more timely by shortening your month-end close URL: https://www.financealliance.io/make-your-information-more-timely/ Last updated: 2022-12-27T10:07:37.000Z One of the ways to improve Finance is to make the information provided to the business more timely. There are two ways to make the reporting timelier: shortening your month-end close (e.g., the time from month-end to the date the books are closed), and speeding up the time from close to reporting and availability of results. This post is concerned with the first part: shortening the month-end close. The month-end close period is the number of days from month-end (Day 0) to the completion of all sub-ledger, journal entry, and review tasks that occur prior to reporting. To shorten the close, you need to do one or more of the following: 1. Decrease the time spent on each task by making it more efficient. 2. Move post-month-end tasks to pre-month-end. 3. Eliminate time spent on other activities during the close. 4. Increase the staff participating in month-end. That is a simple list, but there is some work to do to accomplish it. I recommend establishing a routine that will lead to improvements each cycle. This is what I consider best practice: ### **Set a vision and get team members to set a short-term goal** Start with a meeting where you discuss why faster reporting would be valuable to the business. Consider that one way to measure whether our team is better than our competitor’s team or better than we were in the past is whether we provide information on a more timely basis. Using the practices below, set out how the team might accomplish this. Get the team’s feedback and suggestions and seek a commitment to set and achieve a team goal. [Infographic | 10 FP&A best practices 2023 | Finance AllianceThe best-run finance functions have mastered the art of FP&A. They’ve proved that when done right, FP&A doesn’t just predict business outcomes, it can drive them too. Here, you’ll find our infographic detailing the top FP&A best practices of 2023.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/FP-A-BEST-PRACTICES-2.jpg)](https://www.financealliance.io/infographic-10-fp-a-best-practices/) ### **Create a task list** Get the team together and make a list of every task needed to complete year-end. Define a task as work that takes at least 0.5 hours and no more than 4 hours to complete and creates an output that is either an input to another task, a changed status in the system (e.g., closing the period in the AP ledger), or an adjustment or verification of an account balance. A task that takes longer than 4 hours should be broken up if it cannot be shortened. The task list can live in Blackline or Excel or some other system. Ideally though, for each task, you can track who owns the task, how long it is expected to take, when it's expected to be completed, the status for this period, how long it took this period, and when it was delivered. To start, make a reasonable guess as to how long a task should take and plan which day it will be completed and by whom. As you work the list over the coming months, it can be adjusted. ### **Identify work that can be done pre-month-end** There is likely some work your team is doing during month-end that could be done earlier. Review your task list looking for opportunities to break a task into a pre-month-end and post-month-end piece. For example, we often use the same spreadsheet each month to perform a reconciliation or calculation. The first part of the effort is to take last month’s spreadsheet and roll it forward for the current month. The team member should do this portion before month-end. Then you just need to update a data table with the current month’s transactions after month-end. Another example might be reconciling intercompany transactions. This is often a task that delays closing. However, it’s unnecessary to reconcile a month’s worth of transactions at month-end. Simply change your process to reconciling the activity from the first of the month to the 25that day -5\. Then reconcile the last 5 days at month-end. Certain schedules that amortize pre-paid expenses, calculate straight-line rent or accrue recurring amounts can also be performed before month-end. In addition to moving work earlier, you want to review the list for imbalances between people and days. If the schedule calls for one team member to do 15 hours of tasks on Day 2, it sets you up for failure before you start. [3 principles to lead with confidence through changeAs a finance leader, you need to learn how to lead through change with confidence & in this post, Stephen Newland, Director of FP&A, shares how.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceStephen Newland, CMA![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/Finance-leader.jpg)](https://www.financealliance.io/3-principles-to-lead-with-confidence-through-change/) ### **Hold a daily stand-up during close** Every day beginning with the first day when several tasks are due (e.g., Day -5) have a quick 15-minute stand-up meeting. Review the status of all tasks due the prior day. If not completed on time or if they took longer than expected, try to understand the root cause of the delays. For example, if the information did not arrive in time from another department, the root cause may be that they forgot it was due (so we need a reminder). Alternatively, perhaps they didn’t realize we were expecting it (we need to clarify), or they were out of the office (we need better communication), etc. Use these meetings to focus the team and prioritize meeting the schedule as well as to identify opportunities for improvement for next time. The team leader should also be looking to remove obstacles and resolve problems. Try to avoid blame and defensive language and focus on the process and distractions. If team members bought into a team goal, encourage them to make and keep commitments to complete the tasks on schedule. Discuss how to respond to distracting requests during the close period. ### **Create a scoreboard** During the daily stand-ups, update the task list with the actual hours to complete and the date completed. After month-end, we want to have a scoreboard that shows the portion of the work performed before month-end, total task hours, percent completed on time, and the date and time that the close was completed. If you are familiar with the[ Four Disciplines of Execution](https://www.franklincovey.com/the-4-disciplines/discipline-2-act/), these are the lead indicators we are going to act on. We are betting that if we move work before month-end, make tasks efficient, complete tasks on time, and eliminate distractions during close, we will complete the close earlier. ![After shortening your month-end close, task hours should be lower, earlier, and more focused.](https://transformativecfo.com/wp-content/uploads/2022/08/Month-end-Task-Distribution-Graph-1024x615.png) After transforming the month-end close process, the distribution of task hours should look more like the blue bars. ### **Hold a retrospective after each close** Each month after close, hold a Retrospective with the team. Each team member contributes their thoughts on four categories: 1. What went well? 2. What could have gone better? 3. What questions do you have? 4. What ideas do you have for the future? In addition, you should review the Scoreboard to see if the team improved compared to last time and what led to the improvement. Then make changes to the task list/plan or next time based on the discussion and set some goals for improving the metrics. ### **Continuous improvement** Once you have implemented these suggestions and made them a habit, you have succeeded in putting the team on a path to make the close faster and faster. --- Stay up-to-date with the latest industry news, updates, events, and more – all sent straight to your inbox each month. Keep up with the latest releases on the Finance Alliance blog and podcast and be the first to know about upcoming events, reports, and industry news! **[Subscribe to The Monthly Balance ](https://www.financealliance.io/finance-newsletter/)newsletter today!** [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### Infographic | 10 FP&A best practices URL: https://www.financealliance.io/infographic-10-fp-a-best-practices/ Last updated: 2022-12-23T09:58:49.000Z What are the best practices in financial planning and analysis (FP&A)? The best-run finance functions have mastered the art of FP&A. They’ve proved that when done right, FP&A doesn’t just predict business outcomes, it can *drive* them too. Below, you’ll find our infographic detailing the top FP&A best practices to help you streamline your existing processes and transform FP&A into a strategic and effective initiative that drives distinctive business performance. Enjoy! ## **10 FP&A best practices Infographic:** ![10 FP&A best practices infographic](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/FP-A-best-practices-2023.jpg) Here are some more details about each of the 10 FP&A best practices: ### 1\. Build multiple scenarios based on historical data Businesses must be equipped to face a variety of potential financial scenarios. For example, what would happen if revenue growth slowed down? Or if taxes increase drastically next year? Scenario planning is important because it helps you understand how the business will perform in such events. When using historical data to help map out scenarios, there are three variations of scenario analyses that can prove useful: - **Base scenario** – What’ll happen if the business remains on the same growth trajectory? - **Upside scenario** – What’ll happen if the business performs better than expected? - **Downside scenario** – What’ll happen if the business underperforms? ### 2\. Develop a strategy and translate it into actionable plans Yes, FP&A is used to forecast sales and expenses, and perform the proper budget allocation. But, if you want to help transform the business into a high-performing powerhouse, you must learn to use [FP&A](https://www.financealliance.io/tag/fp-a/) to drive business outcomes. The CEO and other senior members will often approach the FP&A team with high-level strategies to help drive business growth. For example, they might want help identifying areas to cut costs without damaging their reputation as the lowest-cost supplier on the market. The FP&A team then takes that strategy and translates it into an actionable plan to make it happen. This could involve identifying opportunities to cut expenses, targets, timelines, and measurement criteria and communicating all of this to leadership. ### 3\. Allocate resources required to deliver projects and gain budget approval In the same way that you can’t achieve financial projections without an operational plan, you can’t pursue those plans without having the necessary resources at your disposal. Plans won’t materialize without resources to make them happen. Resources can take the form of both time and money, which should be allocated to the plan and/or budget. From there, the FP&A team must gain budget approval from senior management. ### 4\. Link operational plans with how they’ll drive financial growth Operations are intertwined with financial growth. The best-performing companies understand this and make conscious efforts to connect the two. To help link operational plans to how they drive growth, it’s best to start with Operational Managers. While most know everything about their operations inside and out, not everyone understands their impact on the company’s profit and loss (P&L). Therefore, connecting financial growth with operations requires educating the operations team and making sure they can correlate how their goals and actions directly impact finance. ### 5\. Identify and communicate the story behind the data One of the most important FP&A best practices is learning how to communicate numbers to people who can’t understand the data as quickly or as well as someone with a background in finance. This is where variances analysis is particularly useful, especially when a business experiences an earnings shortfall. In this type of situation, an ‘inch deep’ analysis just won’t cut it. Executives and key shareholders such as investors want more than a few lines from the income statement as an explanation, they want to know exactly how the shortfall happened. Teams that follow [FP&A best practices](https://www.financealliance.io/how-to-build-a-culture-of-financial-data-analytics-to-develop-and-act-on-business-insights/) successfully will be able to provide a thorough business understanding of the variance and do so in ways that senior management understands. Data visualization storytelling is another effective way to convert numbers into compelling narratives that accurately depict the story behind the data. You can learn more about data visualization storytelling in the blog post below: [How to use data visualization storytelling to transform FP&AWant to learn how to tell compelling stories with data? Discover techniques to improve your data visualization storytelling skills right here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/data-visualization-storytelling-2.jpg)](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) ### 6\. Take action when you’re falling behind financial or operational goals Sometimes things don’t go as planned and you may find yourself dragging behind financial or operational goals. Companies that follow FP&A best practices tend to use models of agility. This essentially means they respond strategically when goals seem out of reach. Taking action when you’re falling behind is important for obvious reasons. However, you’d be surprised to learn just how many organizations are happy to adjust their expectations downward. In reality, when things aren’t going as planned, it’s time to evaluate what’s happened and identify the steps to get back on track. ### 7\. Hold people accountable for delivering financial and operational results Accountability is important. Best-in-class FP&A ties reward to achievement. In other words, when people do well, they’re rewarded for it whether that’s in the form of a salary rise, bonus, promotion, title change, etc. Holding people accountable is powerful not just for them personally, but those around them too. When someone is held accountable for delivering results and they’re rewarded for doing so, other people take notice. Having accountability for achieving operational targets and financial results drives productivity. This becomes even more apparent when the company provides incentives for doing so. ### 8\. Identify drivers of success and develop measures for those drivers One of the top financial planning and analysis best practices that successful teams follow is to identify factors that drive business success. When a positive financial change occurs, you need to uncover the ‘why’ and take a closer look at the drivers of business success. You can assess the main drivers of success based on the logical connection between the driver and outcome and whether there was an actionable cause that manipulated the driver and can do so again. Some examples of how FP&A professionals identify key drivers of success are searching for a logical connection between something like innovation and business growth, whether the company can manipulate the driver, and how strong the connection is between the two variances (such as innovation and increased revenue). ### 9\. Build an efficient process for rolling forecasts A rolling forecast uses historical data to continuously predict future numbers over a period of time. It’s an essential report that is a lot more agile than static forecasts and therefore more effective at helping senior management make sound business decisions. If you intend to brush up on FP&A best practices going forward, we suggest that you build an effective and efficient process for rolling forecasts. The best-performing rolling forecasts use real-time data to forecast business performance and provide insights for better scenario planning. Not only that, but when done right, a rolling forecast can also be used as a growth measurement tool, which becomes invaluable to both the finance team and leadership. ### 10\. Lean on scenario modeling to understand and mitigate risk [Risk mitigation](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/) is a vital part of FP&A best practices, which is why the most successful teams use scenario modeling to help detect, analyze and mitigate risk. Scenario modeling estimates the likelihood of certain situations occurring. With a scenario model, the business can put a plan in place to protect the business should any of the events actually happen. Although it can be time-consuming to perform strategic scenario planning for outcomes that may never actually happen, it has its fair share of advantages, including: - It helps executives understand the impact of a variety of potential events, making your life easier as an FP&A Manager who has to explain why action plans for different scenarios are necessary. - It can take place at any level of an organization. You can use strategic scenario planning for the entire business or individual projects. - It helps to divide resources rationally and effectively. - It reduces risk and the impact of negative risks because it gives you the insight to prepare for them and ‘fix’ weak spots before they manifest into much bigger problems. Learn how[ strategic scenario planning](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) can prepare your business for anything in this blog post: [How scenario planning can prepare your business for anythingReducing risk and building awareness of what could happen can help you prepare for almost anything. But how does strategic scenario planning work? And how can finance teams use it to future-proof the business? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/firmbee-com-jrh5lAq-mIs-unsplash-2.jpg)](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) --- ### Join the Finance Alliance Community Start networking with other CFOs and finance leaders today. Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world. So, what are you waiting for? [Join our free Slack community](https://www.financealliance.io/community/) ### 7 benefits of a cash flow forecast to drive sustainable business growth URL: https://www.financealliance.io/7-benefits-of-a-cash-flow-forecast-to-drive-sustainable-business-growth/ Last updated: 2022-12-23T10:57:12.000Z Cash is king. It may be a cliché in the finance world, but it’s true. A business needs a healthy flow of cash to thrive and the best way to monitor money going in and out of the business is with a cash flow forecast. But why is a cash flow forecast so important? And how can cash flow forecasting positively impact your business? Understanding the role the cash flow forecast plays in your finances is so important, which is why we’re sharing the top cash flow forecast benefits to help drive sustainable business growth. In this blog post, you’ll learn more about seven key advantages of a cash flow forecast including: [1\. Forecast future cash shortages](https://www.financealliance.io/p/e66cfaac-ed1d-4cf1-bd20-a1b4912281fa/#1-forecast-future-cash-shortages) [2\. Use scenario planning in your cash flow forecasting](https://www.financealliance.io/p/e66cfaac-ed1d-4cf1-bd20-a1b4912281fa/#2-use-scenario-planning-in-your-cash-flow-forecasting) [3\. Monitor business expenditures more accurately](https://www.financealliance.io/p/e66cfaac-ed1d-4cf1-bd20-a1b4912281fa/#3-monitor-business-expenditures-more-accurately) [4\. Track late payments and payers](https://www.financealliance.io/p/e66cfaac-ed1d-4cf1-bd20-a1b4912281fa/#4-track-late-payments-and-payers) [5\. Support decision making](https://www.financealliance.io/p/e66cfaac-ed1d-4cf1-bd20-a1b4912281fa/#5-support-decision-making) [6\. Allocate cash surplus more efficiently](https://www.financealliance.io/p/e66cfaac-ed1d-4cf1-bd20-a1b4912281fa/#6-allocate-cash-surplus-more-efficiently) [7\. Better manage FX risk](https://www.financealliance.io/p/e66cfaac-ed1d-4cf1-bd20-a1b4912281fa/#7-better-manage-fx-risk) ## 7 benefits of a cash flow forecast ### 1\. Forecast future cash shortages One of the best benefits of a [cash flow forecast](https://www.financealliance.io/5-ways-to-instantly-improve-cash-flow-forecasting-techniques/) is the fact it can be used as a helpful tool to identify and plan for cash shortages. Cash forecasting shines a spotlight on cash gaps *before* they become a problem. Having this knowledge in advance gives you ample time to act before the cash shortage hits your business. Preventing cash shortages from damaging the business is crucial to ensure long-term financial health. ### 2\. Use scenario planning in your cash flow forecasting There are many ‘what if’ scenarios that could impact the business and the bottom line. While you can’t prepare for every possible outcome, you can use cash forecasting to build plans to help navigate potential events or situations that could impact the business. Modeling [hypothetical business scenarios](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) gives the business a heads-up in the sense that it allows time to plan and act accordingly to avoid risk and seize opportunities as they come. [3 ways FP&A can thrive amongst a field of skepticismIn this article, you’ll discover three ways an FP&A professional (or an FP&A team) can survive and thrive amongst a field of skepticism.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Page![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/FP-A-professional.jpg)](https://www.financealliance.io/3-ways-an-fp-a-professional-can-thrive-amongst-a-field-of-skepticism/) ### 3\. Monitor business expenditures more accurately Keeping track of business expenditures is no easy task without the right tools and processes in place. However, a key benefit of a cash flow forecast is that it creates a clear picture of cash coming in and going out of the business over a given period. With a cash flow forecast, you can monitor spending more accurately and across different departments. Having one place to see all of that information makes it a lot easier to pinpoint areas where the company is overspending and find opportunities to cut costs when necessary. ### 4\. Track late payments and payers There’s nothing more frustrating than tracking down late payments and the customers behind them. When customers repeatedly pay late, it can knock your company’s cash flow, which will be reflected in your cash flow forecast. Rather than sifting through stacks of invoices and data trying to find the culprit, a cash flow forecast helps you identify late-paying clients without all the hassle. You can then decide how to approach the situation to help prevent late payments from leading to negative cash flow. ### 5\. Support decision making With better data, comes better decisions. On top of helping you understand the potential risk or opportunities of certain situations, a cash flow forecast can also support the decision-making process throughout the organization. Having accurate financial information presented in a cash flow forecast is useful when it comes to deciding whether to invest, cut costs, or push a specific business venture. [The State of Finance Transformation Report | Finance AllianceThe State of Finance Transformation Report 2022 from Finance Alliance reveals exactly how technology is shaping modern finance functions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/FA_State_of_Finance_Transformation_Report_2022_Blog_2.png)](https://www.financealliance.io/the-state-of-finance-transformation-report-2022/) ### 6\. Allocate cash surplus more efficiently If your company has excess cash in the bank, a huge benefit of a cash flow forecast is that it helps predict when surplus cash will be available. The business can then plan what they want to do with the surplus, such as reinvest it in new markets, pay back a loan, etc. ### 7\. Better manage FX risk A [reliable cash flow forecast](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) will be one of the best tools at your disposal when it comes to mitigating risk connected to foreign currency. You can use it to not only anticipate evolving cash needs, but it’s also useful to better understand a company’s exposure, reduce foreign currency transactions where necessary, and plan for mitigating risk related to FX. There are so many advantages of a cash flow forecast that you really can’t afford not to have one. From monitoring fluctuations in cash flow and predicting future financial impact, a cash flow forecast is a powerful asset for any business. Having a clear understanding of your company’s cash flow is vital for continuous growth and preparing for potential issues before they become a present-day reality. *Want to read more of our financial planning and analysis (FP&A) articles? Check out our library of[ FP&A articles](https://www.financealliance.io/tag/fp-a/) right here.* ### What does an FP&A Manager do? (Role and career guide) URL: https://www.financealliance.io/fp-a-manager-what-does-an-fp-a-manager-do/ Last updated: 2025-04-08T17:38:14.000Z The role of an FP&A Manager is in extremely high demand. The need for financial planning and analysis has skyrocketed since COVID-19, with [financial planning and analysis (FP&A)](https://www.financealliance.io/your-ultimate-guide-to-fp-a/) becoming a vital function within companies facing uncertainty and inevitable change. Of course, FP&A is nothing new, but data and technology trends have played a huge role in transforming FP&A into a valuable business asset. Not to mention, the evolution of finance professionals into strategic business partners has also played a hand in rising FP&A to a must-have status within businesses. But what does an FP&A Manager do? And what skills do you need to pursue a career in FP&A? In this article, you’ll learn what the main FP&A responsibilities, skills, and traits are to become a value-driven FP&A professional on the road to success. Topics covered: - [What does FP&A stand for?](https://www.financealliance.io/p/b688b4e5-1645-4180-9b3d-c48b15f3beaf/#what-does-fpa-stand-for) - [What is an FP&A Manager?](https://www.financealliance.io/p/b688b4e5-1645-4180-9b3d-c48b15f3beaf/#what-is-an-fpa-manager) - [What skills do you need to be an FP&A Manager?](https://www.financealliance.io/p/b688b4e5-1645-4180-9b3d-c48b15f3beaf/#what-skills-do-you-need-to-be-an-fpa-manager) - [FP&A roles and responsibilities](https://www.financealliance.io/p/b688b4e5-1645-4180-9b3d-c48b15f3beaf/#fpa-roles-and-responsibilities) - [What is the typical FP&A Manager salary?](https://www.financealliance.io/p/b688b4e5-1645-4180-9b3d-c48b15f3beaf/#what-is-the-typical-fpa-manager-salary) ## What does FP&A stand for? FP&A stands for Financial Planning and Analysis, a group of planning, budgeting, forecasting, and analytical processes that support business decisions made by the CEO, CFO, and the Board of Directors, etc. ## What is an FP&A Manager? The FP&A Manager develops, provides, and implements financial analysis on key metrics and KPIs, providing valuable data-driven insights to support decision-making. By reviewing past company performance and tracking economic and business trends, they can accurately predict possible future outcomes and help devise plans to navigate those outcomes successfully. FP&A Managers also oversee business forecasting, create financial budgets, and conduct performance-based analyses. They aren’t usually siloed in their roles and will often coordinate with other divisions and teams within the company. An FP&A Manager isn’t just an accountant. They are excellent communicators and leaders, ensuring important processes such as variance analysis and budgeting are running as smoothly as possible. [How to build a culture of financial data analytics | Brian Kalish | Finance AllianceOur ‘new normal’ keeps changing and finance teams must adjust processes including people, process, culture, and technology to adapt. Confronting a historic level of uncertainty has rendered traditional methods of data analytics, forecasting, and scenario planning all but useless.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/sean-pollock-PhYq704ffdA-unsplash-2.jpg)](https://www.financealliance.io/how-to-build-a-culture-of-financial-data-analytics-to-develop-and-act-on-business-insights/) ### Variations of FP&A roles There are different variations of roles related to FP&A, and while their titles are different, a lot of their roles and responsibilities are the same. The main difference between each role comes down to seniority and experience. Some roles that typically involve FP&A include: - Chief Financial Officer (CFO) - Director of FP&A / FP&A Director - Senior Analyst or Manager - Junior Analyst In some businesses, the individual or team responsible for FP&A is often referred to in more general terms such as FP&A professionals, specialists, experts, etc. ## **What skills do you need to be an FP&A Manager?** There are certain [FP&A skills](https://www.financealliance.io/3-ways-an-fp-a-professional-can-thrive-amongst-a-field-of-skepticism/) that every finance professional must have to thrive in their role, and these include: ### Budgeting Creating budgets is a vital skill for an FP&A Manager, who will spend a good chunk of time planning what metrics the company is expected to hit, such as cash flow, revenue, burn rate, runway, etc. Quarterly, monthly, and annual budgets are all part of the job. You’ll be expected to develop them based on the company’s past performance, growth forecasts, and on analysis of current trends and market conditions. ### Forecasting Making realistic forecasts of the company based on past and present data is one of the main roles of an FP&A Manager. Projecting numbers of specific areas within the business and monitoring the company’s process toward those numbers is crucial to ensure everything’s going according to plan. If things start to fall off the wagon, the FP&A Manager will know before it gets out of hand and take action to get things back on the right track. Identifying trends as early as possible and proposing solutions to avoid risk and meet budgets will put you on the most wanted list of FP&A professionals (in the best way possible). ### Communication and collaboration If you thought working as an FP&A Manager meant locking yourself up in a cubicle and keeping to yourself, think again. FP&A Managers are excellent communicators and collaborators. They work with a range of different people and often from various departments, which means polished communication skills are a must. You’ll often act as an advisor to the rest of the team, including leadership, which means you need to work effectively with others. Communicating data insights to people outside of the finance function can be tricky, so get creative with data visualization storytelling techniques and practice communicating complex data in a more digestible and easy-to-understand way. ### Financial analysis Probably one of the most important skills for any FP&A Manager, taking a retrospective look at the company’s financial performance and identifying the ‘why’ behind the data is a vital part of the role. Financial analysis and financial reporting involve assessing not just the profitability of the business, but also the viability and stability of the business moving forward. It includes tasks such as evaluating budgets, projects, and financial transactions to assess their performance and help make strategic business decisions. ### Leadership In times of uncertainty, finance often rises as a comforting voice that reassures and offers viable solutions when necessary. FP&A Managers don’t work alone or solely with numbers. You may manage an entire team dedicated to financial planning and analysis, in which case you’ll need strong leadership skills to emphasize with others, cultivate positive team culture, and understand the needs of those around you. [Finance and HR: Can they peacefully coexist? | Finance AllianceIt’s no secret: Finance and Human Resources (HR) are often at odds with each other. But is it destined to be this way? In this article, you’ll learn more about how HR and Finance can work together in important areas of business.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceAdam Tzagournis, CPA![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/12/hannah-busing-Zyx1bK9mqmA-unsplash-2.jpg)](https://www.financealliance.io/finance-and-hr-can-they-peacefully-coexist/) ## **FP&A roles and responsibilities** The FP&A Manager has a variety of responsibilities related to indirect cost and rate management and financial analysis and reporting. Their responsibilities may change as business needs evolve, but here is a general overview of some of the typical duties of an FP&A Manager: - Evaluating the financial health of a company. - Supplying financial analysis and reports on key KPIs. - Creating internal reports to support leadership’s decision-making. - Identifying when and how the company can optimize assets, investments, and progression opportunities. - Collaborating with other departments to prepare accurate budgets. - Building and maintaining financial models and forecasts. - Analyzing historical data and reporting on areas such as monthly financial analysis, variance analysis, pipeline analysis, etc. ## **What is the typical FP&A Manager salary?** Pinning down an exact universal number for the salary of an FP&A Manager is incredibly difficult. So, we’ve accumulated some statistics from several sources to gain a clearer picture of the average FP&A Manager's salary. According to [Wall Street Prep](https://www.wallstreetprep.com/knowledge/fpa-career-path-salary-guide-analyst-director/), the average FP&A Manager salary in the USA is around $85,000 to $115,000 (including bonuses). This is based on a finance professional with at least five to 10 years of experience. We saw similar statistics from other sources, including Salary.com, which estimated the average salary for this position to fall somewhere between $106,477 and $147,916.In the UK, the average FP&A Manager salary is around £69K according to [Glassdoor](https://www.glassdoor.co.uk/Salaries/fp-and-a-manager-salary-SRCH%5FKO0,16.htm). A Senior Finance Manager may have a higher salary of approx. £77K. --- ### Want to learn more about financial planning and analysis? *Join our panel of FP&A professionals and finance experts from Google, E-Capital, HDMI, and more at the* [***FP&A Summit***](https://events.financealliance.io/location/sandiego) *in *San Diego* on *March 8th – 9th 2023*. They’ll be exploring forecasting in uncertain times,* [*mastering FP&A*](https://events.financealliance.io/location/sandiego/agenda) *to establish predictability in times of change, and more.💡* *Join our attendees for a 2 day event that will feature keynotes, panels, and more from top industry decision makers to equip you for future challenges and help you unlock your career potential.* **Register now before tickets run out!* 👇* [Find out more](https://events.financealliance.io/location/sandiego) ### 3 principles for finance leaders to lead with confidence through change URL: https://www.financealliance.io/3-principles-to-lead-with-confidence-through-change/ Last updated: 2022-12-08T12:07:58.000Z This past year, I’ve found myself wondering if I have what it takes to lead through change. I implemented a billing system for a startup, took on a new role and had the two most senior people on the team leave within two months for various reasons. Oh, and I became a first-time dad! And…I’d be lying if I said I was confident leading through all of it. As a finance leader, you probably have similar stories to mine. You want to lead with confidence through change but struggle to. Maybe you’ve had deliverables change, tech changes, or people changes on your team. All of those changes can cause us to look in the mirror and ask ourselves if we’ve got what it takes. The reality is that change is constant in finance. The best finance leaders rise to the occasion and lead from the front lines during times of change. So…how can we lead confidently through it? Three principles stand out when I look back at times when I’ve led with the most confidence: 1. [Be vulnerable](https://www.financealliance.io/p/0c9543a0-c063-486b-aa2f-7c521f162655/#be-vulnerable) 2. [Communicate clearly](https://www.financealliance.io/p/0c9543a0-c063-486b-aa2f-7c521f162655/#communicate-clearly) 3. [Learn to adapt](https://www.financealliance.io/p/0c9543a0-c063-486b-aa2f-7c521f162655/#learn-to-adapt) ## **3 principles to lead with confidence as a finance leader** ### Be vulnerable Communicate to your team that you don’t have all of the answers. Why? Your team will gain respect for you and you’ll gain their trust. You’ll feel like a team. The best teams know the strengths and weaknesses of the unit. Where one might be weak another might have strength. This is especially important if you’re the leader because it will give others on your team the freedom to be vulnerable too. That means that you’ll have a good insight into if someone doesn’t have the skillset to accomplish something or will need more resources to get the job done. This will allow you to give real-time feedback easier because egos tend to diminish on a team that’s vulnerable with each other. During times of change, you need speed and agility. Real-time feedback is critical. Vulnerability is a sign of confidence. Vulnerable people know that they’ll elevate others around them through their vulnerability. This might feel uncomfortable at first, but it’s effective. ****Practical Application** Tell your team about a time you failed and the lesson you learned from it. Work this in naturally to an all-hands meeting or 1:1’s. You might be surprised how others open up. This needs to be cultivated over time so it’s best to start sooner than later. [How to navigate uncertain times with a driver-based forecastMany companies are announcing budget cuts and layoffs in response to the uncertain economic environment. Unfortunately, most companies lack the finance tools and strategic clarity needed to navigate such an environment well.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceChris King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/driver-based-forecasting.jpg)](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/) ### Communicate clearly In times of change, clear communication with your team and leadership is your greatest asset as a finance leader. When everyone understands the primary goal and the part they play in achieving the goal things just run smoother. This will add to your confidence to lead during times of change. Clear communication starts with understanding the communication style that works best for your team and leadership. Some people prefer long emails with all of the details. Others might just need high-level bullet points, while others may just want to hop on a quick call. Taking the time to tailor communication to different people takes time, but I’d argue that it takes even more time down the line if there’s confusion because of a lack of good communication. If there’s a key message you want your team and leadership to know during a time of change, repeat it more times than you think you need to. They have other communication from countless others competing against the message you want to stick to. ****Practical Application** Set up regular lines of communication during times of change. Maybe that’s in the form of a daily huddle with your team or a weekly meeting/email to your leadership. This will give you the opportunity to communicate belief in your team, ask your leadership for more resources and provide them with updates on what they’re most concerned about. In these huddles/emails, always ask if anything is unclear. [How to instantly improve cash flow forecasting techniquesWhen done well, a cash flow forecast will accurately estimate money flowing in and out of the business over a set period of time. If you want to improve your cash flow forecasting techniques, keep reading to discover five tips to help you do just that.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/cash-flow-forecasting-methods-header-image.jpeg)](https://www.financealliance.io/5-ways-to-instantly-improve-cash-flow-forecasting-techniques/) ### Learn to adapt as a finance leader Times of change require agility. It means putting old initiatives on hold to prioritize something new. If you’re a planner, like me, quick change can frustrate you without a system in place to manage it. Having a system in place will help reduce those feelings of overwhelm and frustration in the midst of change. Overwhelm and frustration can erode confidence quicker than just about anything. If you’re not in the middle of change it can be easy to ignore this step, but taking some time now to get a system in place will allow you to jump right into change confidently when it happens. ****Practical Application:** Get organized now with your priorities and deadlines. Follow these five steps below: 1. Write down current deadlines 2. Which can be delayed? Delegated? Eliminated? 3. What new deadlines need to be elevated? 4. Refresh the plan, as needed 5. Execute the plan If you have a plan in place, execution becomes much easier for you as a finance leader because you have a clear focus on what needs to get done and by when. Step back and imagine you have a big change on your team. Think about if you: - Led with a vulnerability that resulted in a more cohesive team with fewer blind spots. - Had clear communication with your team and leadership so everyone was on the same page. - Had a system in place that allowed you to adapt quickly. ****How confident would you feel leading through the change you’re facing?** Imagine how much of an impact we, as finance leaders, could have on our teams and organizations if we learn to lead confidently through change. --- ### **Join more finance leaders in our Slack Community** *Sign up for our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today!* *Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.* ***[Sign up to the Finance Alliance Slack community](https://www.financealliance.io/community/) and introduce yourself, we can't wait to meet you (even if it is virtually!).** ### Finance and HR: Can they peacefully coexist? URL: https://www.financealliance.io/finance-and-hr-can-they-peacefully-coexist/ Last updated: 2025-04-05T07:39:31.000Z It's no secret: Finance and Human Resources (HR) are often at odds with each other. But is it destined to be this way? Folks often see these two groups as completely distinct entities. In reality, they're co-dependent. They need each other. The truth is, HR and Finance can (and must) work together to create a more efficient workplace. In this article, you'll learn more about how HR and Finance can work together in important areas of business, including: - [Hiring employees](https://www.financealliance.io/p/fc88b611-1d0a-4d3f-b10b-9cb188591a3e/#hiring-employees) - [Onboarding](https://www.financealliance.io/p/fc88b611-1d0a-4d3f-b10b-9cb188591a3e/#onboarding) - [Compensation](https://www.financealliance.io/p/fc88b611-1d0a-4d3f-b10b-9cb188591a3e/#compensation) - [Payroll and benefits](https://www.financealliance.io/p/fc88b611-1d0a-4d3f-b10b-9cb188591a3e/#payroll-benefits) - [Healthcare and wellness](https://www.financealliance.io/p/fc88b611-1d0a-4d3f-b10b-9cb188591a3e/#healthcare-and-wellness) - [401K plans](https://www.financealliance.io/p/fc88b611-1d0a-4d3f-b10b-9cb188591a3e/#401k-plans) - [Stock options](https://www.financealliance.io/p/fc88b611-1d0a-4d3f-b10b-9cb188591a3e/#stock-options) - [Terminated employees](https://www.financealliance.io/p/fc88b611-1d0a-4d3f-b10b-9cb188591a3e/#terminated-employees) ## **What do those people even do?** Let's clear the air: both finance and HR are crucial for any company. Full stop. There's no company without the hiring, onboarding, and ongoing support that HR provides. And guess what? That company won't last long if it spends recklessly or the financial strategy hasn't been ironed out. In other words, a company needs both departments to keep the lights on. But what does that mean for the relationship between HR and finance? Well, it should be a partnership - not a competition. Otherwise, the overlapping of responsibilities leads to duplication of effort, confusion, and lots of conflict. [Crisis Management Plan vs Business Continuity Plan | Finance AllianceBelieve it or not, a crisis management plan is not the same as a business continuity plan. The two are similar in many ways, sure, but they have key differences that set them apart.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Crisis-management-plan-vs-business-continuity-plan.jpg)](https://www.financealliance.io/crisis-management-plan-vs-business-continuity-plan/) ## **How can finance and HR work together?** ### Hiring employees Finance and HR must be in sync for the hiring process to function at all. For example, Finance must work with all departments to create the hiring budget. However, they also need to confirm with HR that it's realistic to actually find and onboard quality candidates for those roles within that budget and timeframe. Communication should continue throughout the entire hiring process. For example, let's say an HR manager finds a candidate they're excited about but whose salary expectations are outside of the budget. Should HR just move forward full throttle anyway? Not unless they want to ignite conflict. Instead, the HR manager should reach out to finance to discuss the possibility of increasing the budget or negotiating with the candidate. Without this line of communication, the company may miss out on a great candidate. Or even worse, it may hire someone who isn't the right fit. ### Onboarding After a new employee is hired, many forms need to be completed from both a financial and HR standpoint (think legal and bank account info, tax & benefit forms, and so on). Finance teams need to know about the new hire in order to set up payroll and process tax forms. To make this easier, HR should have a system in place (an HRIS) that automatically shares this data with Finance when a new employee is onboarded. That way, everyone is on the same page. This communication should be ongoing, as changes in taxes, benefits, immigration status, and other details will impact both departments. [Finance career advice from 3 experts | Finance AllianceWe asked a few of our special guests on the Two Cents: Finance Talk podcast to share their best finance career advice to help build a successful finance career and here’s what they had to say…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/compass-ga6f9af187_1920-2.jpg)](https://www.financealliance.io/finance-career-advice-and-tips-from-3-experts/) ### Compensation The same goes for setting salaries. HR is usually in charge of researching the going rate for a certain position and location. However, they need to consult with Finance to ensure that the company can actually afford to pay that salary. They also need to consider things like raises and bonuses. For example, if an employee is being promoted, HR will need to work with finance to adjust their salary accordingly. Finance also needs to be involved when it comes to setting up commission structures and other types of incentive-based compensation. This ensures that the company is spending its money in the most efficient way possible and not overpaying employees for meeting certain targets. Meanwhile, HR needs to ensure that an employee's total compensation is fair and consistent with the rest of the market. ### Payroll & benefits Payroll is a function typically handled by the accounting & finance department. However, payroll data is crucial for HR purposes, especially when dealing with new hires and terminations. Make sure your payroll system standardizes communication and shares this data between the two departments. Again, a single source of truth removes the risk of duplicate or incorrect data. In addition, HR and finance departments can collaborate on benefits administration. By working together, the two departments can ensure proper communication so employees can make informed decisions on their benefits. ### Healthcare and wellness For healthcare, the two departments should collaborate on open enrollment so that employees understand their health insurance options and make the best choices for themselves and their families. They can also work together to manage the plan costs that the company incurs. By sharing data and working together, they can find ways to reduce insurance costs while still providing high-quality plans. Finance and HR should also cooperate to form wellness programs. They're a great way to reduce healthcare costs by encouraging employees to live healthier lifestyles (e.g. gym membership reimbursements). [FinTech Trends 2023 | Finance AllianceWhat does the future hold for FinTech? In this post, Xavier Gomez, the COO and Co-Founder of INVYO, shares his top 3 predictions for FinTech Trends in 2023.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBekka Nathan![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/FA-2-Cents-Podcast---Meta-2.png)](https://www.financealliance.io/podcast/fintech-trends-2023-top-trends-future-predictions-for-fintech/) ### 401k plans 401k plans are also an area ripe for collaboration. Finance and HR should create resources together so that employees understand what your plan offers (especially company matches, that's free money for them!) and can make informed choices. ### Stock options Stock options for new hires are important because they help attract and retain top talent. On the backend, Finance needs to make sure that the stock options are properly accounted for (and approved by the board of directors). This includes understanding the tax implications and tracking options as they vest. Meanwhile, HR needs to ensure that employees understand their stock options and how they can impact their future. An [equity management platform](https://www.linkedin.com/pulse/spreadsheet-manage-your-cap-table-please-dont-adam-tzagournis-cpa/) can help with this. ### Terminated employees Terminated employees must complete paperwork for all the benefits mentioned above. There are usually strict deadlines to complete everything. This includes post-termination exercise periods for stock options, COBRA for healthcare, and 401k terminations. Finance and HR should get clear on their roles in this process by creating a shared checklist of actions and approvals that need to happen. You can use a tool like Trello to create an offboarding template that keeps everyone in the loop on a given employee's termination progress. ## **Conclusion** The Finance and HR departments both play a vital role in keeping the company running smoothly. By working together, you can improve coordination and communication to better meet the needs of all employees. So, next time you're feeling like you're in a silo, take a look around and see how you can help your fellow colleagues. Chances are you'll benefit from it too. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### How was your experience at the FP&A Summit? | Bruno Oliveira, Swissport URL: https://www.financealliance.io/how-was-your-experience-at-the-fp-a-summit/ Last updated: 2022-12-05T10:17:30.000Z [Bruno Oliveria](https://www.linkedin.com/in/bosilva/) is the Head of FP&A at **Swissport**, the world's leading airport ground and air cargo handling services company. In November 2022, Bruno attended our [FP&A Summit](https://summit22.financealliance.io), a virtual event designed to keep finance professionals ahead of trends and arm them with the skills they need to drive their business *and* career forward. In this case study, Bruno shares: - [Why he wanted to attend the FP&A Summit](https://www.financealliance.io/p/f81c9c96-9b4e-4b1e-837b-e2cebfec2126/#1-how-did-you-find-out-about-the-fpa-summit-and-why-was-it-important-for-you-to-attend-our-virtual-event) - [What were the key insights he found interesting](https://www.financealliance.io/p/f81c9c96-9b4e-4b1e-837b-e2cebfec2126/#2-were-there-any-particular-insights-at-the-fpa-summit-that-you-found-interesting) - [How he's going to apply findings from the event in his current role](https://www.financealliance.io/p/f81c9c96-9b4e-4b1e-837b-e2cebfec2126/#3-how-are-you-going-to-apply-the-findings-from-the-fpa-summit-in-your-current-role) - [His favorite speaker session and why he found it so interesting](https://www.financealliance.io/p/f81c9c96-9b4e-4b1e-837b-e2cebfec2126/#4-what-was-your-favourite-speaker-session-and-why) - [His biggest takeaway from the event](https://www.financealliance.io/p/f81c9c96-9b4e-4b1e-837b-e2cebfec2126/#5-what-was-your-biggest-takeaway-from-the-event) - [How the FP&A Summit differed from similar events](https://www.financealliance.io/p/f81c9c96-9b4e-4b1e-837b-e2cebfec2126/#6-how-did-this-event-stand-out-compared-to-others-on-the-market) - [Whether he would recommend our events to his peers](https://www.financealliance.io/p/f81c9c96-9b4e-4b1e-837b-e2cebfec2126/#7-would-you-recommend-other-finance-professionals-to-attend-one-of-our-events) ### 1\. How did you find out about the FP&A Summit and why was it important for you to attend our virtual event? I found it in Linkedin searching from FP&A Events. It was very important because it is a rare opportunity to have leading edge content with worldwide experts for *free*. ### 2\. Were there any particular insights at the FP&A Summit that you found interesting? Yes. To keep an eye even more opened for the dichotomy strategy-FP&A. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### 3\. How are you going to apply the findings from the FP&A Summit in your current role? Yes. Mainly “driver-based planning”. ### 4\. What was your favourite speaker session and why? [Chris King](https://www.financealliance.io/author/chris/). It was amazing how easy he made to connect strategy-operations-finance. ### 5\. What was your biggest takeaway from the event? How important is to have more discussion about FP&A in a practical and easy going way, assuring that from analysts to high-leaders, we are being inspired from the same leading edge vision. [The State of Finance Transformation Report | Finance AllianceThe State of Finance Transformation Report 2022 from Finance Alliance reveals exactly how technology is shaping modern finance functions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/FA_State_of_Finance_Transformation_Report_2022_Blog_2.png)](https://www.financealliance.io/the-state-of-finance-transformation-report-2022/) ### 6\. How did this event stand out compared to others on the market? There’s not much events deep appointed to FP&A, for me it’s a one-of-a-kind. ### 7\. Would you recommend other finance professionals to attend one of our events? Yes, sure! [3 ways FP&A can thrive amongst a field of skepticismIn this article, you’ll discover three ways an FP&A professional (or an FP&A team) can survive and thrive amongst a field of skepticism.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Page![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/FP-A-professional.jpg)](https://www.financealliance.io/3-ways-an-fp-a-professional-can-thrive-amongst-a-field-of-skepticism/) --- ### Are you thinking about attending the next Finance Alliance event? Keep an eye on our events tab to keep up with all of our upcoming events. You can also sign-up to watch all of our events [OnDemand](https://summit22.financealliance.io), including this FP&A Summit, from the comfort of your own home. ### 3 ways an FP&A professional can thrive amongst a field of skepticism URL: https://www.financealliance.io/3-ways-an-fp-a-professional-can-thrive-amongst-a-field-of-skepticism/ Last updated: 2025-04-07T10:19:19.000Z In my speaking session at the Finance Alliance [FP&A Summit](https://events.financealliance.io/location/sandiego), I discussed how we could incorporate incentive schemes both in the long and short term to align managers with business owners' financial objectives. I argued that by focusing on the monetary reward and communicating this clearly across teams, it would enable a strong partnership with the FP&A team, to ensure that you're an integral part of strategic financial discussions. In the Q&A session that followed, I was asked what to do if the operations team didn’t believe that an FP&A professional's analysis was necessary. If you found yourself in a circumstance where the FP&A team was new to the organization, how could you address any skepticism that you were able to bring value and ultimately improve business performance? This can often be amplified by the fact that the business unit has been operating successfully without input from an FP&A professional in the past. So, it becomes a challenge, particularly when your initial efforts can add to their workload and administrative burden. In this article, you'll discover three ways an FP&A professional (or an FP&A team) can survive and thrive amongst a field of skepticism. ## **Stick close by to the data** Firstly, the focus of your efforts should be around bringing yourself up to speed on the data that already exists in the organization. Not only in the sense of what the key metrics are but where there are gaps in the data. If you spot any inconsistencies in reporting metrics over time, say the past three years, then carrying out a full audit in your own space will help clear the decks for any progressive changes you may be about to propose. This also achieves several further benefits: it gives you the confidence as an [FP&A](https://www.financealliance.io/tag/fp-a/page/2/#sts=FP&A) professional to speak up about the results, ongoing performance, and trends that will, in turn, help guide you in asking the right questions to the team. Your goal here is to elicit trust with the teams and break down any existing preconceptions around what the data is telling them. It'll also help you understand where the difficulties lie in data collection and what data is currently collected that requires manual intervention. This will give you a broader understanding of what is involved in contact with the operational teams and ensure that any future conversations you have with them relating to data will not be completely railroaded into the ‘too difficult’ bucket on account of the current processes. Once you are then comfortable with understanding and tracking the data that exists across the organization, address the processes around data collection and where manual inputs are required by operational teams. Think through how processes could be redesigned or adapted to minimize the touchpoints that teams will have with the data. You need to be able to preempt the pushback you will experience from operations and therefore be ready with constructed solutions that will address the skepticism they are likely to retort with. Armed with this prepared work, you can then approach teams with more open-ended questions. By taking a consultative approach, you can ask not only what the current dataset is telling them, but what new data series they would like to see and where they currently believe their blindsides exist. For this part to be most successful, it will help to have an ally in operations for you to bounce ideas off, which brings me to my next point. [FP&A: What is financial planning and analysis?What does FP&A stand for? In this post, we’re covering the basics of financial planning and analysis!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/What-is-FP-A--2.jpg)](https://www.financealliance.io/what-is-financial-planning-and-analysis/) ## **Find your data champion in operations** Every organization has one individual who has found themselves in an operations role but is an incognito data champion. On their own accord, they will have searched out the data and run analysis and even entire dashboards for themselves. It can often be surprising how extensive this work can be, completely separate from any formal business intelligence or finance efforts. Seeking out these individuals and ensuring that their efforts are captured and integrated into ongoing business processes, will help from two fronts. Firstly, having someone who understands the operations from the inside out will accelerate your knowledge of what data is useful and can be utilized. Secondly, taking counsel from these individuals, testing your ideas, and seeking a greater understanding of their operating environment, will not only assist you in having more meaningful conversations on operational matters but will give you a worthy ally in changing the cultural mindset of the team around the use of data and how it can drive decision making. One of the goals you are wanting to achieve early on in these interactions is to derive a key relationship in the data with which you can improve forecasting to predict results. Addressing this challenge in partnership with someone on the operational team will help in your ability to understand where to look for these relationships and to adjust for any real-world impacts that may cloud the data when pulled into your analysis. [How to use data visualization storytelling to transform FP&AWant to learn how to tell compelling stories with data? Discover techniques to improve your data visualization storytelling skills right here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/data-visualization-storytelling-2.jpg)](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) ## **Feedback on progress back to senior management** In an ideal world, carrying out a thorough audit of data processes and outputs, as well as aligning your efforts with the resident operations data champion should see you face any skepticism against the FP&A function that you may have initially faced. However, we do not live in an ideal world. Therefore in addition to proceeding with this work, you also need to develop strong communication channels back to senior management, which keeps them abreast of your progress and ensures that you highlight the problems you face in a timely manner. You will face roadblocks in your journey, with either the state of the data or indeed with how the tech stack brings together the data in the first place. Ensure then that you map out what your stated goals are and where progress has got to in achieving these. Communicating what you are setting out to achieve is a difficult challenge in itself and is time-consuming, however, it will pay dividends further down the line, when progress becomes stalled and it can be difficult to articulate where progress has become stuck and therefore where resources or support needs to be applied. [XP&A: 5 advantages of extended planning and analysisWhat is xP&A? In this post, we define the meaning of xP&A and share 5 surprising advantages of xP&A that every CFO should be aware of.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/5-facts-about-xp-a.jpg)](https://www.financealliance.io/5-advantages-xp-a/#sts=What%E2%80%99s%20the%20difference%20between%20FP&A%20and%20xP&A?) ### Key Takeaways In summary, you should gain a thorough understanding of the data and think through solutions to data processes that seek to minimize the impact on the operations team. Seek an ally from within to help with bridging the gap in your knowledge, with what data may or may not be needed. Finally, communicate your overall plan with senior management and be vocal in highlighting roadblocks to help unstick these. Ultimately skepticism will exist where there is mistrust. Your priority should therefore be focused on building this trust and providing a clear signal that the data will always be your guiding light in the journey. --- *Wanna learn more about financial planning and analysis? Join our panel of FP&A professionals and finance experts from Google, E-Capital, HDMI, and more at the* [***FP&A Summit***](https://events.financealliance.io/location/sandiego) *in *San Diego* on *March 8th – 9th 2023*. They’ll be exploring forecasting in uncertain times,* [*mastering FP&A*](https://events.financealliance.io/location/sandiego/agenda) *to establish predictability in times of change, and more.💡* *Join our attendees for a 2 day event that will feature keynotes, panels, and more from top industry decision makers to equip you for future challenges and help you unlock your career potential. *Register now before tickets run out!* 👇* [FP&A Summit | San Diego![](https://storage.googleapis.com/acara-assets-production/production/organizations/62876e34645e9fcb6e4019c8/1668182122230-FA-Icon-Colour-No-Background-Padding-01.png)San Diego![](https://storage.googleapis.com/acara-assets-production/production/organizations/62876e34645e9fcb6e4019c8/1666708747126-FP-and-A-Meta-2023-2.jpg)](https://events.financealliance.io/location/sandiego) ### The State of Finance Transformation Report 2022 URL: https://www.financealliance.io/the-state-of-finance-transformation-report-2022/ Last updated: 2024-07-19T13:01:58.000Z [**The State of Finance Transformation Report 2022**](https://productmarketingall.typeform.com/to/f5Yjq66a) **has arrived!** Read through its pages to uncover how modern finance teams adopt new technology to improve data collection, automate timely tasks, and more. You’ll also unpack intriguing insights from global finance experts on the current state of digital transformation and learn how technology is shaping modern finance functions. ### Why did we create this report? The role of finance within organizations is changing. Gone are the days when you spent most of your time manually inputting data into spreadsheets (yawn!). Thanks to new technologies, many of the most tedious and mundane tasks can be (or have been) automated. Finance can now step up and offer its unique expertise to influence better-informed decisions that help drive the business forward. But how can finance professionals like you leverage technology to drive positive change not just within your organization, but in your everyday role? And how can you convince the CEO that it’s time to invest in finance transformation? You’ll discover the answers to all these questions and more inside [The State of Finance Transformation Report 2022](https://productmarketingall.typeform.com/to/f5Yjq66a). ### Key topics discussed in this report include: 💡 Where finance transformation is **now**. 🔑 **Key drivers** of finance transformation. 💰 The positive impact of **automation in finance**. 🤔 **Common challenges** and how to overcome them. ⚒️ How to develop a **culture of change**. 🔮 What a **successful adoption** of finance transformation looks like. ….and so much more. ### A sneak peek of what’s inside: ► **70.4%** of finance professionals said their organization is currently developing a finance transformation strategy. ► **92.6%** said the main driver of finance transformation is the desire for more efficient processes. ► **55.6%** of finance professionals predict that big data analytics will be the biggest game changer for finance over the next 12 months. ► More than half (**55.6%**) of respondents said that FP&A processes have benefited the most from digitalization. ### Ready to get stuck in? Grab your copy today and discover the real impact of finance transformation on not just organizations, but the everyday life of finance pros like you! 👇 ### Finance career advice and tips from 3 experts URL: https://www.financealliance.io/finance-career-advice-and-tips-from-3-experts/ Last updated: 2022-11-23T11:36:55.000Z Pursuing a career in finance can lead to a variety of different paths and roles. Once you’ve got a foot in the door, it becomes so much easier to work your way up the financial career ladder. However, it takes a lot of hard work to achieve a CFO level of success. And you may face a lot of challenges on the way to the top, which can make you doubt yourself and your abilities. When imposter syndrome kicks in, sometimes the best way to overcome it, gain your confidence back and re-focus on your goals is to learn from others who have been where you are now, which is exactly what you’ll find in this article. We asked a few of our special guests on the [Two Cents: Finance Talk](https://www.financealliance.io/podcast-two-cents-finance-talk/) podcast to share their best finance career advice to help build a successful finance career and here’s what they had to say… **What advice do you have for someone who wants to build a successful career in finance?** --- ## **Brian Kalish** ### Principal and Founder of Kalish Consulting I've been around for a little while and when I was hiring for my FP&A team 20 years ago, what I wanted was someone who knew accounting, and was a Jedi Master at Excel. That skill set is not the skill set that we need for today or tomorrow. When people ask me - what makes a good FP&A professional? What are you looking for? I always say I want a quant, which is someone who understands finance and understands accounting but tells great stories. I need a storyteller communicator who completely understands my business. Yes, it’s important to have the blocking and tackling of finance and accounting. Your life will be a lot easier if you can read a balance sheet and understand the general ledger, those are important. But you’re already expected to know those things. The next level is communication. So, how do I determine whether someone's a good communicator or not? ### 1\. Understanding your audience A part of it is understanding your audience. You have to be a good either teacher or a chameleon in the sense that you need to be able to understand your audience because the way people consume information is very different. The onus is on your ability to tell that story, and this depends on the way you present information. ### 2\. Speaking their language Analysis is critically important. But the ability to share that with someone is just as important. I believe that math and numbers are a language, and I understand what numbers mean. However, if you show that to HR or the marketing department, that's not the story they need. So, you must understand how communications works and how people consume information differently. ### 3\. Understand what business you’re in I like asking people two questions. The first is simple - what does Starbucks sell? The number one answer is coffee, which is the wrong answer. They don’t sell coffee, they sell an experience. If they were selling coffee, it'd be a function of price. You don’t buy Starbucks because you want a cup of normal coffee. You buy Starbucks because you want to buy a Starbucks cup of coffee. Finance people need to get out and see the business. You must understand how the business works. If you don’t, nobody wants you to come to them and say, “Here's how you should run your business better even though I don't understand anything about your business.” You just don't have any credibility. Start with small wins – think about simple things you can do to build trust. Even though you’re in finance, you have to look at things in a much broader sense and actively look for opportunities to understand the business better. We're not just talking about numbers, we're talking about a business. If I were to distill my finance career advice to one component or characteristic, it’s this – you need to be curious. The way you're going to succeed is by asking the question why? If you're someone who just accepts the status quo, then you're a reporter. You're someone who's doing diagnostic and descriptive work. If you want to do more than that, the best career advice I can give you is to be curious and have that innate ability to ask why. Ask why we’re doing things the way we're doing it? We're not in the slow-moving world anymore. We're in a very fast-moving world and we have to understand it. Try to learn something new every day. It doesn't necessarily have to be business related but try to learn something new and be someone who is constantly learning. **Want to hear more from Brian? Listen to his episode on the Two Cents: Finance Talk podcast [here](https://www.financealliance.io/podcast-two-cents-finance-talk/?wchannelid=id4lbj7w42&wmediaid=rpvsdzt6x4).** You can also read Brian's articles on the Finance Alliance blog, including: - *[How finance automation is changing FP&A](https://www.financealliance.io/how-finance-automation-is-changing-role-fpa/).* - [*How technology is impacting the planning, budgeting & forecasting function.*](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) - *[How to build a culture of financial data analytics to develop and act on business insights.](https://www.financealliance.io/how-to-build-a-culture-of-financial-data-analytics-to-develop-and-act-on-business-insights/)* [How to build a culture of financial data analytics | Brian Kalish | Finance AllianceOur ‘new normal’ keeps changing and finance teams must adjust processes including people, process, culture, and technology to adapt. Confronting a historic level of uncertainty has rendered traditional methods of data analytics, forecasting, and scenario planning all but useless.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/sean-pollock-PhYq704ffdA-unsplash-2.jpg)](https://www.financealliance.io/how-to-build-a-culture-of-financial-data-analytics-to-develop-and-act-on-business-insights/) --- ## **Stewart Houston** ### Exec. Director of Business Operations Finance at ICON plc. I think certain intrinsic things can be valuable as finance career advice such as simply being authentic. Try not to be the person who's looking at that ladder all the time because it becomes apparent that you’re just looking to climb the ladder, and not do a good job. Sometimes you just need to do a good job where you're at, and they'll get recognized, and then the ladder climbing will come. But there is recognition that, you know, we’re human beings, and the way we organize ourselves there is always a certain amount of politics. So, there will have to be an increasing amount of exposure to senior-level people but don't try to force those interactions. If you do good things within the business units, etc. that will come to people's attention naturally anyway. You’ll be on calls with them, and you'll get recognized. An evolution to that stage rather than trying to force it is always better. It’s something that’ll happen through you doing a good job. I think it's more important to ensure that you’re enjoying what you're doing, rather than looking to climb the ladder because you can’t do one without the other. If you advance further, then you're enjoying what you're doing and I think we all should enjoy what we're doing. To some degree, do we enjoy every second? Absolutely not. But you need a sense of enjoyment and fulfillment from your work, which is more important than climbing ahead A faster route to climbing up the ladder managerially and title-wise may not be the route that’s good for you, your core skill set, and what you would naturally enjoy doing on a day-to-day basis. Obviously, we want to climb as high as our abilities will take us. But it has to be measured with everything else. It can't be the sole goal. Otherwise, you'll end up in the wrong place. If things happen too quickly and that is your only aim, you may end up somewhere where you're no longer happy being. My other piece of finance career advice is to be realistic about what's achievable. As long as you're doing the right things, you'll get to where you need need to be naturally. Not everyone's going to be a Finance Director. You have to have that realization of your capabilities and what's good for you. > It is not always your current knowledge that matters but what you are prepared to discover. - **Stewart Houston** [Listen to Stewart's full episode on the Two Cents: Finance Talk podcast.](https://www.financealliance.io/podcast-two-cents-finance-talk/?wchannelid=id4lbj7w42&wmediaid=ei8268utl1) Read Stewart's article, *The 3 pillars of a successful finance business partner – Stewart Houston*, here: [How to become a successful finance partnerWant to know how to become a successful finance partner? The role of the finance function has changed massively over recent years. Rather than generating reports all day, finance pros must step into a partnership role and work closely with other functions of the business.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/money-g094a1229b_1920-2.jpg)](https://www.financealliance.io/podcast/3-pillars-successful-finance-partner/) --- ## **Ilya Osver** ### Financial Analyst Be curious, always curious. Read a lot like with any industry, just be curious. And you will see that things become easier, and your job will be a lot easier too. As a Finance Analyst, you've also got to be negative in the sense that you must be suspicious of people and companies who want money from you. Treat the company's or bank’s money like your own. When you’re considering lending money, for example, think to yourself – would you give this person money from your pocket? If not, then why should the company do it? My next career advice is to stay up to date with your industry. Many things in finance haven’t changed since 1976, such as financial ratios. But the approach has changed because the world is constantly changing. Software is changing too, so as a finance professional, you need to be up to date. Finally, enjoy your work. Loving your job is very important. Start loving your job. Our work is much more interesting than manually tying numbers, it’s almost like we’re trying to predict the future with our forecasts and scenario planning, etc. My motto in life is that nothing is impossible. So, if something isn’t working, try to solve it yourself. [Tune in to Ilya's full episode of the podcast here.](https://www.financealliance.io/podcast-two-cents-finance-talk/?wchannelid=id4lbj7w42&wmediaid=esgbe6yati) Read Ilya's article, *How to create a financial forecast model*, here: [How to create a simple financial forecast modelFinancial forecasting predicts the future performance of the business. But how can you build a financial forecast model from the ground up? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/financial-forecast-model.jpg)](https://www.financealliance.io/podcast/financial-forecast-model/) **To hear from more finance professionals sharing their advice, insights, and expertise, tune in to the [Two Cents: Finance Talk podcast](https://www.financealliance.io/podcast-two-cents-finance-talk/) \- and don't forget to subscribe!** ### FinTech Trends 2023: Top Trends & Future Predictions for FinTech URL: https://www.financealliance.io/podcast/fintech-trends-2023-top-trends-future-predictions-for-fintech/ Last updated: 2022-11-17T11:02:23.000Z What does the future hold for FinTech? In this episode of the [Two Cents: Finance Talk podcast](https://www.financealliance.io/podcast-two-cents-finance-talk/?wchannelid=id4lbj7w42&wmediaid=wswrqvwqdu), Xavier Gomez, the COO and Co-Founder of INVYO, shares his top 3 predictions for FinTech Trends in 2023. But that's not all, he also goes into detail about how these new trends in FinTech will impact the global economy. You can listen to the full episode below: Or, if you prefer, keep reading to learn more about FinTech Trends for 2023. **Xavier covers topics such as:** - [Top 3 FinTech trends to watch in 2023](https://www.financealliance.io/p/b7dc2b3b-828b-4a0c-8be6-6b066369421a/#top-3-fintech-trends-to-watch-in-2023) - [Gamification: Linking gaming and finance](https://www.financealliance.io/p/b7dc2b3b-828b-4a0c-8be6-6b066369421a/#gamefi-linking-gaming-and-finance) - [Will blockchain become a bigger part of our everyday lives?](https://www.financealliance.io/p/b7dc2b3b-828b-4a0c-8be6-6b066369421a/#will-blockchain-become-a-bigger-part-of-our-everyday-lives) - [How new trends in fintech will impact the global economy](https://www.financealliance.io/p/b7dc2b3b-828b-4a0c-8be6-6b066369421a/#how-new-trends-in-fintech-will-impact-the-global-economy) - [How previous FinTech trends are performing](https://www.financealliance.io/p/b7dc2b3b-828b-4a0c-8be6-6b066369421a/#how-previous-fintech-trends-are-performing) - [The metaverse and why it's top of mind for many professionals](https://www.financealliance.io/p/b7dc2b3b-828b-4a0c-8be6-6b066369421a/#the-metaverse-and-why-its-top-of-mind) ## Top 3 FinTech trends to watch in 2023 **Q. What do you think will be the top 3 FinTech trends to watch in 2023?** **1.Blockchain technology** I’d first like to start with blockchain technology. This year has been a rollercoaster for the crypto industry and investors. The market was valued at two trillion dollars and has mostly evaporated. We are in a transition period today as you can see lots of investment and creation in this particular industry to invest in blockchain infrastructure, mostly in crypto exchange. This is a new trend because this building of infrastructure has a different application for finance between the banks and the central banks’ equation of digital money. In terms of business in the gaming sector, there’s a lot of flow from GameFi, gaming, and finance. People like to pay to earn, and younger people are also willing to pay to see other people play games, particularly on Twitch. This is a new business model in parallel with the development of Web3\. It's a huge trend and you have big players in a different ecosystem and the creation of different blockchains on Web3. Blockchain technology aims to address a different issue in terms of increasing speed and security, in particular with international payments. Payments and blockchain are deeply linked with banks to become mainstream in the coming years. **2\. Embedded finance** Another trend would be embedded finance, which refers to the integration of financial tools or services within the offering of a non-financial institution. This is a big competitive area for regular institutions because it comes with new infrastructure, more services, and a bigger capacity to integrate into any IT infrastructure. The ecosystem of embedded finance covers financial services such as banking, credit, and investments, and extends its reach to adjacent areas like payments, processing, and insurance. The most well-known form of embedded finance is buy now pay later (BNPL). This payment option allows people to buy a product now and pay for it later, usually by splitting the purchase into multiple installments to be paid at set times. **3\. Alternative financing** The last trend to watch out for would be alternative financing. The COVID-19 virus has left its mark on almost every corner of the world. According to 2021 surveys, a large portion of bank leaders didn't reduce the amount of capital dedicated to supporting trade. The global trade finance gap is still steadily widening, and this is where alternative financing comes into play. Alternative finance refers to the business funding offered by non-banking institutions. And some of this funding doesn’t end up becoming a loan at all. The emergence of non-finance institutions is a big change and means big competition for traditional banks or financial institutions. Currently, there is not a huge competition against regular financial institutions, but you can certainly see significant growth. The valuation of this market is between two and seven billion and is growing every year from 6%-10%. [How to navigate uncertain times with a driver-based forecastMany companies are announcing budget cuts and layoffs in response to the uncertain economic environment. Unfortunately, most companies lack the finance tools and strategic clarity needed to navigate such an environment well.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceChris King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/driver-based-forecasting.jpg)](https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/) ## Gamification: Linking gaming and finance **Q. Could you tell us a bit more about GameFi?** A: As I mentioned before, this is the link between gaming and finance. Today, Gamification (GameFi) refers to play-to-earn blockchain games which offer an economic incentive to players. Typically, players can earn cryptocurrency and NFT rewards by completing a task, battling other players, and progressing through the different game levels. Unlike traditional video games, most blockchain games let players transfer items out of the game’s virtual walls. Players can trade their items on NFT and cryptocurrency exchange marketplaces. GameFi has rapidly been taking over the traditional gaming industry since the rise of Axie Infinity. It attracts gamers by offering them an opportunity to make money while also having fun. Now with the development of blockchain, you have a deep link with virtual worlds. And you can see the merger between blockchain, infrastructure, Web3, and a new business model. It’s a new world where people are ready to play to receive rewards on tokens or crypto. Big brands are also ready to make advertisements in order to attract consumers to these types of games. This is a new concept and new business model to discover in the coming years, and each GameFi project will adopt a different model in the game economy. In most cases for in-game assets, NFTs run on the blockchain, which means they can be traded on the NFT marketplace. However, in-game assets need to be converted into an NFT before players can trade or sell them. ## Will blockchain become a bigger part of our everyday lives? **Q.** **Just like digital banking has become a part of our lives, perhaps tokenized assets and blockchain will also be used much more in the coming years. What do you think about this?** A: Exactly. We can see that play-to-earn is a revolutionary gaming mode, and it's very different from the pay-to-play model adopted by traditional video games. Pay-to-play requires gamers to invest before they can start playing. For example, famous video games like Call of Duty require players to purchase licenses or recurring subscriptions. Traditional video games will not generate any financial returns for players, and their in-game assets are controlled and held by the gaming company. In contrast, play-to-earn games give players full control over their in-game assets while also offering opportunities for them to make money. This is a completely new internal business model, and very a interesting one. [How to instantly improve cash flow forecasting techniquesWhen done well, a cash flow forecast will accurately estimate money flowing in and out of the business over a set period of time. If you want to improve your cash flow forecasting techniques, keep reading to discover five tips to help you do just that.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/cash-flow-forecasting-methods-header-image.jpeg)](https://www.financealliance.io/5-ways-to-instantly-improve-cash-flow-forecasting-techniques/) ## How new trends in fintech will impact the global economy **Q. How do you think these new trends and developments in the fintech industry will impact the global economy?** A: When you manage money today, you have to be regulated. Tomorrow, all the big players will be non-financial companies that manage payments, so they will have to be compliant. With the current trend, money and traditional financial institutions will become a commodity because they will be competing with a whole other player in any industry, particularly gaming because you don't have any friction. Regulation relies on the values of the young generation such as Generation Alpha and Generation Z. They may not understand compliance requirements in terms of compliance, money laundering, and anti-terrorism action. This is why I would say to watch out because malicious players have the potential to come into this kind of industry. We have to regulate softly for now as this industry is new, however, it has big growth potential. ## How previous FinTech trends are performing **Q. Have any of the trends we’ve talked about in the last five years already plateaued? Are they already part of the new normal and not a subject of excitement anymore?** A: I used to work as a trader and fund manager, where the quants guys used to sit near salespeople and traders on the trading floor. Over time, the salespeople and traders have been replaced by quants on the trading floor. So now you have two or three real traders and the rest are automated with algorithms. The quants are just there to check that everything is working. Transactions are the same. There is a model in place of ‘do it yourself’. You have an API connected with your client, your client sends you an order, and you don't require any more sales. And behind that process is technology, a quant, and an algorithm. This change was also good for the banks because they have different regulations in terms of working capital with Basel III. You should drastically reduce the operating cost if you want to stay competitive and if you’re going to work on this kind of operation. It is the new normal today. Even I have made big moves and replaced most of the sales and traders with a quant, data scientist, and data engineer. [How to build a culture of financial data analytics | Brian Kalish | Finance AllianceOur ‘new normal’ keeps changing and finance teams must adjust processes including people, process, culture, and technology to adapt. Confronting a historic level of uncertainty has rendered traditional methods of data analytics, forecasting, and scenario planning all but useless.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/sean-pollock-PhYq704ffdA-unsplash-2.jpg)](https://www.financealliance.io/how-to-build-a-culture-of-financial-data-analytics-to-develop-and-act-on-business-insights/) ## The metaverse and why it's top of mind **Q. If you had to name one app, platform, or technology that you're going to follow next year, what would it be?** A: It's not directly linked with finance or fintech, but I would say the metaverse. As you know, Meta (previously known as Facebook) made a big bet on the metaverse and invest a billion US dollars per year. JP Morgan has also invested a lot of money to propose some services in different metaverse worlds. The metaverse should be a good thing, but it could also be risky in terms of society. It is a virtual world, and perhaps some of us will not make the distinction between what you can do in the real world versus the metaverse. Of course, you have to pay for this kind of service, and we can see from news stories that people spend a lot of money to play with or buy something because there’s no friction, it's very easy. And some platforms even give you credits to consume their content and so on. From a technological perspective, it's a big step because it requires a lot of machine learning, AI, data, and good user design and definition. But also in terms of the real world and particularly for the younger generation, we have to be careful. ***Q. The regulations on metaverse or tokenized assets remain a big question mark. In the future, do you think that it’s going to be more regulated?*** A: Yes of course. We’ve already heard stories of bad behaviors happening in the metaverse against women and certain populations. In the real world, this would not be accepted, so of course, we have to regulate it a little bit. What you’re allowed to do in the metaverse will be aligned with what you’re allowed to do in reality. ### **About the guest** ![FinTech trends 2023 - Xavier Gomez - Two Cents podcast episode 7](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/FA-Podcast_Social.png) *Xavier Gomez is the COO and Co-Founder of INVYO, a data management startup that uses machine learning and natural language processing to help corporations identify tomorrow's opportunities in the financial industry. He is also a regular columnist on the television news channel, BFM Business.* ### How CFOs can reduce their SaaS spend URL: https://www.financealliance.io/how-cfos-can-reduce-their-saas-spend/ Last updated: 2022-11-18T11:59:44.000Z There’s no denying that SaaS spending has increased astronomically in recent years. So much so that it now accounts for around 12.7% of total spend, meaning that roughly $1 in every $8 is now being invested in software applications. But it’s not set to slow down any time soon. According to Gartner, worldwide spending on cloud application services (SaaS) is expected to [**exceed $208 billion in 2023**](https://www.gartner.com/en/newsroom/press-releases/2022-04-19-gartner-forecasts-worldwide-public-cloud-end-user-spending-to-reach-nearly-500-billion-in-2022) — up 37% in just two years. A finding that is supported further by the fact that [**more than half of all organizations**](https://swzd.com/resources/state-of-it/) are planning to increase their IT budgets in the coming year. Yet, despite this rise in IT budgets and SaaS spending, the economic slowdown cannot be ignored. [Nor can the **rise of SaaS inflation**](https://eu1.hubs.ly/H02bjc20). So, while budgets may be growing, finance leaders are becoming increasingly challenged to ensure that the software being invested in is driving maximum efficiency and delivering exponential value to the organization. Simply put, they must look at new ways to optimize their SaaS spend. ## The biggest challenges surrounding SaaS spend optimization When it comes to reducing software spend, finance leaders face two challenges: decentralized SaaS purchasing and obscured software pricing. Analyzing both in detail reveals more challenges: ### Decentralized SaaS purchasing Unlike almost every other business overhead, the selection, management and renewal of SaaS is often decentralized, causing huge problems for finance and IT teams alike. In fact, research suggests that as much as 66% of SaaS spend is managed by business units or individual employees. It’s also been found that in some organizations, as many as [**32 billing owners**](https://blog.fusebill.com/subscription-management-software-in-subscription-based-business) may be tied to a single subscription, emphasizing just how fragmented the SaaS purchasing process really is. So, why is it happening? In some organizations, department heads are being given increased autonomy to purchase new software applications, particularly those under a certain value. In others, maverick spending is happening in a bid to [**bypass procurement protocols**](https://eu1.hubs.ly/H022f3n0)**.** Either way, when software is purchased without the knowledge or approval of the finance team, it can lead to a whole host of problems, including: **● Auto-renewals** According to data from Vertice, as many as 89% of software vendors include auto-renewal clauses in their contracts.The problem is, when software is purchased without the finance team’s knowledge, they won’t be able to keep on top of these renewals, which can have huge financial implications for the business in terms of renewing unwanted and often expensive software licenses. ● **Duplicate or redundant SaaS applications** Close to a [**third of total SaaS spend**](https://eu1.hubs.ly/H022f4K0) is either underutilized or wasted. But while this should ideally be the starting point for any finance team looking to cut their SaaS spending, either by consolidating tools that have overlapping functionality or eliminating the applications that are no longer in use, without prior knowledge of these tools it’s just not possible. ● **Unused licenses** The average company wastes around $135,000 on SaaS software annually, a portion of which comes from unused licenses or seats. So, while the tools themselves may be in use, you may be subscribed to — and therefore paying for — excess licenses. ● **Overpriced software** With the majority of software vendors choosing to obscure their pricing — 55% to be precise — organizations are left with very little leverage to negotiate the best possible prices. In fact, our data shows that a typical business is [**overspending by about 20-30%**](https://eu1.hubs.ly/H022f4K0) on SaaS annually. ### Obscured software pricing It’s not just decentralized SaaS buying that’s causing problems for finance leaders, it’s also the [**lack of pricing transparency**](https://eu1.hubs.ly/H022f430) in the market. As we’ve already mentioned, organizations are overpaying for their SaaS tools by as much as 20-30%. What we’ve not yet mentioned though is that this is happening to as many as 90% of businesses. So, why is this? Ultimately, because vendors have all the leverage — the majority don’t publish list prices and there’s no simple way of knowing just how willing they are to provide a discount, which makes it extremely difficult for buyers to negotiate the best possible pricing and contract terms. Here’s the thing though: these issues can be prevented with both visibility and insight. When finance teams have oversight of their entire SaaS stack and spend, they can: - More easily manage spend - Stay ahead of SaaS renewals - Identify opportunities to reduce costs - Prevent maverick spending But this is only possible with a centralized SaaS purchasing model. To gain complete control of your SaaS spend, you ultimately need a comprehensive system of record that details every single piece of software being subscribed to by your business, including the cost of each tool, the number of licenses being paid for — and at what cost per license — the owner of the application and the terms of each contract. Then you need to keep track of this information, a process that is best automated. At [**Vertice**](https://eu1.hubs.ly/H022f5d0), we do just that. We give you complete visibility of your entire SaaS stack from a single place, enabling you to track your subscriptions, renewals and spend. But that’s not all we do. We also give you the insight you need to gain leverage when negotiating the terms of your contract. Insights such as SaaS buying trends and pricing intelligence. In other words, we can tell you how much other companies are paying for the same subscription. Better still, we can take the burden of managing, buying and renewing SaaS off your hands, saving you a substantial amount of time and money. **See for yourself how much we can save you at Vertice, with our [free cost savings analysis](https://eu1.hubs.ly/H022f4F0).** ![Vertice - SaaS procurement made easy](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/-2022-10--BizClik-Banner-970x250-2-1.png) --- ### How Finance professionals can measure their business impact URL: https://www.financealliance.io/how-finance-professionals-can-measure-their-business-impact/ Last updated: 2022-11-14T09:30:50.000Z *Many Finance professionals strive to become better business partners supporting the business through insights and decision support.* *But how do you measure whether you are succeeding as a finance business partner?* *This article presents three ways to measure your impact as a finance business partner.* ## Creating impact as a business partner At its core, the sole focus of finance business partnering must be to create real business impact – helping the business to be in a better place than it would have been without the involvement of finance. However, impact is an unclear concept in today’s corporate world. It's a term used frequently, often as meaning “*having a strong effect on someone or something in the business*” (Cambridge Dictionary, 2022), but without any clarification on how it is measured. As a Finance professional, three ways to measure your impact as a finance business partner include: 1. **Business results:** Your ability to help the business reach its objectives and financial results. 2. **Value interventions:** The effect of your value-adding interactions with the business. 3. **Customer satisfaction:** The value of your services as perceived by the business stakeholders, i.e., your internal customers. [How to transform your team into finance business partnersFinance teams are more than just number crunchers. To become a finance business partner, you must create value by providing insights that help business leaders make data-driven decisions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Schöler![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/finance-business-partners-header-image.jpg)](https://www.financealliance.io/number-crunchers-finance-business-partners/) Each of the three ways to measure your impact is unfolded below. ### Business results Finance professionals striving to be true business partners should be measured according to the same metrics as the business being supported. That is, as a business partner, you're a success if your internal business stakeholders are succeeding. > **...as a business partner, you're a success if your internal business stakeholders are succeeding.** In the most ambitious form, a finance professional who's committed to act as a true finance business partner must create a value-add equal to or larger than the cost associated with his/her employment. That is, if you’re not improving the net profit by an amount greater than the sum of your salary plus overhead, the company has no reason to keep you on the payroll. However, as a Finance professional, you are rarely able to influence revenue directly, nor are you able to reduce costs significantly without the involvement of others. Thus, to succeed as a finance business partner, you must assert influence to create an indirect impact on the business results through others. ### Value interventions Measuring your impact on the overarching results of the business is an impossible task for most - who knows exactly what their effect is on the bottom line? However, measuring the impact of your interventions on the business is more tangible. That is, when you – as a Finance professional – deliver services to an internal business stakeholder, the value created by these efforts can often be documented in terms of various performance measures such as productivity improvements, risk reductions, lead times, or even monetary effect. > **Finance business partners should see their engagements with the business as value interventions and keep track of their results.** Consequently, your impact as a finance business partner comes down to your ability to create 'value interventions' - value-adding interactions with your business stakeholders. By monitoring the progress and results of your value interventions, you will be able to showcase your ability to create business impact. [How to become a successful finance partnerWant to know how to become a successful finance partner? The role of the finance function has changed massively over recent years. Rather than generating reports all day, finance pros must step into a partnership role and work closely with other functions of the business.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/money-g094a1229b_1920-2.jpg)](https://www.financealliance.io/podcast/3-pillars-successful-finance-partner/#sts=3%20main%20pillars%20of%20finance%20business%20partnering) ### **Customer satisfaction** As concluded earlier, finance business partnering entails creating an impact through others. That is, finance business partnering is about exuding influence on others, thereby making them act in different ways than they would have done otherwise. To achieve influence through others, you must see your internal stakeholders as a customer base. > **Only by keeping the customers satisfied, will you be able to succeed with impact creation.** Consequently, to measure your impact as a finance business partner, you should keep track of customer satisfaction through frequent dialogues, performance reviews, or even a qualitative measure like a Finance NPS (Net promotor score). If your internal customers are satisfied, you are doing something right. --- Want to keep the conversation around finance business partnership going? If so, consider joining the [Finance Alliance Slack community](https://www.financealliance.io/community/), where you can network with other finance professionals, share ideas, access resources, and more. [Sign up here!](https://www.financealliance.io/community/) ### How a driver-based forecast can help CFOs navigate uncertain times URL: https://www.financealliance.io/how-a-driver-based-forecast-can-help-cfos-navigate-uncertain-times/ Last updated: 2025-04-07T10:19:42.000Z Many companies are announcing budget cuts and layoffs in response to the uncertain economic environment. Unfortunately, most companies lack the finance tools and strategic clarity needed to navigate such an environment well. A typical reaction we already see in the layoffs announced this year is to try to cut costs in line with revenue reduction. If revenue is off 20%, they seek to cut expenses by 20%. Payroll costs around 70% of total costs and a greater percentage of costs that can be rapidly trimmed. It’s common for executives to turn to layoffs as a necessary tactic to “live to fight another day.” They believe the “willingness to make tough decisions” is one of the burdens that come with the responsibility of being an executive. They delegate the task of determining who should be cut to department heads that are often not bought into this action until the last minute. To be “fair” to them, some CEOs give all the executives an even share of the burden by asking for “across-the-board” cuts. Viewing payroll simply as a cost is the first mistake. After all, companies hire employees for a reason: to support the activities that produce revenue and create value. Cutting employees cuts those activities and the ensuing chaos following a layoff impairs them further. [10 principles for a successful finance transformationTo truly transform a finance function into one that gets more efficient and effective each year, you need a transformation that does not begin or end with technology. Below are my 10 principles of finance transformation...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceChris King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/laptop-g40c597eea_1920-2.jpg)](https://www.financealliance.io/10-principles-thatll-make-your-finance-transformation-successful/) Another mistake is fixating on fiscal year periods. In a difficult economic environment, the goal is not to have a good year. When the market changes, the goal becomes understanding: - How the market has changed - How the company needs to change in response - How resources need to be adjusted or redeployed to ensure employee activities align with the actions needed to survive and thrive in the future. ## **How to navigate a decline in revenue** The first step to take when [revenue declines](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) is to analyze the decline. Was it a decrease in price or volume? What has happened to supply and demand? If the volume has declined, consider the real impact on market demand. Perhaps customers have decided to put off making this purchase, and there is pent-up, unsatisfied demand. If so, what will happen to relieve this pent-up demand in the future? Or maybe customers have found a lower-cost substitute for your product. If that's the case, what can you offer at a similar price point to meet this demand? Has there been a long-term reduction in demand for certain products or services? After identifying the root causes of the impacts on your revenue drivers, you can start to form a strategy for dealing with the new environment. This is what the executive team gets paid to do – aligning the activities of employees and the investment of capital with the objectives necessary to succeed in the long term. Companies that try to save the current year plan are distracted from making the right long-term decisions. Understanding the most important initiatives for the company to accomplish in the short term allows you to take actions that are much more effective than across-the-board layoffs. Some areas of the business may need more staff, some employees may need to be retrained and redeployed, and some departments may need to run an initiative to improve productivity and reduce costs. Naturally, you may determine that some product lines will have a long-term reduction in volume and you should reduce staffing commensurate with the decline in transactions. In that circumstance, the best you can do is to try to execute the layoff well and support the remaining employees. The work you did to understand your revenue decline and how the business needed to adjust to it will pay off here. [How to instantly improve cash flow forecasting techniquesWhen done well, a cash flow forecast will accurately estimate money flowing in and out of the business over a set period of time. If you want to improve your cash flow forecasting techniques, keep reading to discover five tips to help you do just that.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/cash-flow-forecasting-methods-header-image.jpeg)](https://www.financealliance.io/5-ways-to-instantly-improve-cash-flow-forecasting-techniques/) ## **The Finance tool to navigate difficult times** The most important financial tool for running the business is a good driver-based rolling forecast that looks out for about five years and is based on Beyond Budgeting principles. Leading the effort to create a good one is probably the most valuable thing your Finance team can do for you. This is far more important in times when the future is uncertain and results are chachrnging quickly. In these circumstances, your [Financial Planning & Analysis](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/) (FP&A) team is wasting their time and yours if they put together a variance analysis telling you which departments and line items are over or under the (now obsolete) budget you all spent months putting together. Reforecasting to December is not going to be much help either. A good driver-based rolling forecast creates clarity around the drivers of both your revenue and your expenses and enables agility in a challenging market. Instead of having executives complain about “arbitrary cuts” to “their budget,” you can focus on a strategy for success and the actions required to carry it out. Although a good driver-based forecast generally comes from iterating several versions, the thinking and discussion required to put the first version together will help you navigate the near-term crisis. Times of uncertainty leads to faster buy-in and engagement from the executive team for shifting from a static budget to a dynamic forecast process. As the adage goes: “never let a crisis go to waste.” Corporations spend a large amount of time, focus, energy, and resources producing financial statements for boards and shareholders, preparing budgets and variance reports to control how money is spent, and developing bonus plans to align variable compensation with the achievement of short-term targets. These short-term targets are often obtained through activities detrimental in the long term such as pulling revenue forward or focusing only on deals that can be closed this quarter. It takes a relatively small investment to build a far better navigation tool to allow the company to navigate rapidly changing environments with agility and to align resources with the critical activities that move the business forward. The more the driver-based forecast is used and improved, the more able the company will be to navigate challenging times without across-the-board layoffs. **You can read more great content like this by Chris on our** [**blog**](https://www.financealliance.io/author/chris/) **and on Chris' website,** [**Transformative CFO**](https://transformativecfo.com)**.** --- *Wanna learn more about financial planning and analysis? Join our panel of experts from Google, E-Capital, HDMI, and more at the* [***FP&A Summit***](https://events.financealliance.io/location/sandiego) *in *San Diego* on *March 8th – 9th 2023*. They’ll be exploring forecasting in uncertain times,* [*mastering FP&A*](https://events.financealliance.io/location/sandiego/agenda) *to establish predictability in times of change, and more.💡* *Join our attendees for a 2 day event that will feature keynotes, panels, and more from top industry decision makers to equip you for future challenges and help you unlock your career potential. *Register now before tickets run out!* 👇* [FP&A Summit | San Diego![](https://storage.googleapis.com/acara-assets-production/production/organizations/62876e34645e9fcb6e4019c8/1668182122230-FA-Icon-Colour-No-Background-Padding-01.png)San Diego![](https://storage.googleapis.com/acara-assets-production/production/organizations/62876e34645e9fcb6e4019c8/1666708747126-FP-and-A-Meta-2023-2.jpg)](https://events.financealliance.io/location/sandiego) ### 5 ways to instantly improve cash flow forecasting techniques URL: https://www.financealliance.io/5-ways-to-instantly-improve-cash-flow-forecasting-techniques/ Last updated: 2024-06-20T11:03:14.000Z A winning cash flow forecasting plan is accurate and reliable. Granted, cash forecasting isn’t the most glamorous part of the role of a finance professional, but it’s vital for business continuity. When done well, a cash flow forecast will accurately estimate money flowing in and out of the business over a set period of time. If you want to improve your cash flow forecasting techniques, keep reading to discover five tips to help you do just that. In this article, we cover: - [What is cash flow forecasting?](https://www.financealliance.io/p/a1c78465-df55-412b-b5ae-a14a0f6b70a4/#what-is-cash-flow-forecasting) - [Why is cash flow forecast important to a business?](https://www.financealliance.io/p/a1c78465-df55-412b-b5ae-a14a0f6b70a4/#why-is-cash-flow-forecast-important-to-a-business) - [How to improve cash flow forecasting techniques.](https://www.financealliance.io/p/a1c78465-df55-412b-b5ae-a14a0f6b70a4/#how-to-improve-cash-flow-forecasting) ## **What is cash flow forecasting?** A cash flow forecast is essentially a document that estimates how much cash is coming in and out of the business. It also includes projected income and expenses, typically covering the next 12 months. However, you can also use cash flow plans for shorter periods, such as a week or a month. If you want to identify funding requirements or excess cash in the short term, performing a cash flow plan covering 30 days is the best option. On the other hand, if your goal is to predict future sales, you may want to expand the cash flow forecast to cover between one month to one year ahead of time. ![Cash flow forecasting techniques - tip](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/cash-flow-forecasting-techniques.png) ****Note**: **Short-term cash flow forecasts tend to be more accurate. The longer the time period of your cash flow forecast, the less accurate the results are (in most cases).* ## **Why is cash flow forecast important to a business?** Cash flow forecasts are vital to helping steer business decisions in the right (and most profitable) direction. By predicting cash flow, businesses can better prepare for potential cash flow issues and come up with a strategy to deal with them. The more accurate your cash flow forecasting techniques are, the better. Here are a few more reasons why cash flow forecasting is so important to a business: - A cash flow plan reveals whether the business is meeting expectations and if not, what areas need some work. - You can predict the impact of potential best and worst-case scenarios and come up with a plan should one (or more) of those scenarios happen. - Cash forecasting helps you identify upcoming expenses. - Keep track of overdue payments and plan for cash gaps. - Track whether company spending is on target, break down your budgeting and make adjustments where needed. [How many jobs are available in finance? | Finance AllianceHow many jobs are available in finance? The answer is A LOT. Here’s a simplified overview of some of the most popular career paths in finance....![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/how-many-jobs-are-available-in-finance.jpg)](https://www.financealliance.io/finance-careers-how-many-jobs-are-available-in-finance/) ## How to improve cash flow forecasting ### 1\. Create different best-case and worst-case scenarios Building a variety of cash flow forecast scenarios is a great way to prepare action plans should your company experience any financial deviations. Of course, you can’t plan for *every* possible scenario (such as natural disasters, geopolitical tensions, or global pandemics). But preparing for different scenarios will give your company a good foundation to work from and help you to create more accurate and reliable forecasts. ### 2\. Decide how far in advance you want to plan Your cash flow plan can cover anything from one week to many months. Your cash flow forecasts must be adapted for specific timeframes, so you have to decide whether you’re forecasting short, medium, or long-term. Start-ups probably won’t have enough data to plan far out, which can lead to inaccurate predictions. In most cases, using short-term cash flow forecasts is the best choice for newer businesses. On the other hand, established businesses will have an easier time forecasting further out since they’ll have data that articulates a predictable sales pipeline, making future forecasts and predictions more likely to be accurate. ### 3\. Leverage automation Save time (*and your sanity*) by consolidating cash flow data in one place using automated technology. Manually inputting data into spreadsheets is a time-consuming process where human error thrives. If your company hasn’t invested in automation yet, consider implementing cash flow forecasting software to help improve cash flow management by automatically collecting and sorting data. **Tip**: *You can use automatic reminders to alert stakeholders and teams that the deadline is approaching to contribute to the cash flow forecast.* *This is particularly useful if you rely on others to provide cash flow data to help ensure the timely and reliable completion of your forecasts.* [How to build a culture of financial data analytics | Brian Kalish | Finance AllianceOur ‘new normal’ keeps changing and finance teams must adjust processes including people, process, culture, and technology to adapt. Confronting a historic level of uncertainty has rendered traditional methods of data analytics, forecasting, and scenario planning all but useless.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/sean-pollock-PhYq704ffdA-unsplash-2.jpg)](https://www.financealliance.io/how-to-build-a-culture-of-financial-data-analytics-to-develop-and-act-on-business-insights/) ### 4\. Make sales forecasting a regular process Forecasting sales is important to help create accurate cash flow forecasts that reflect the current state of cash revenue. Take the guesswork out of the equation and start relying on precise sales data to help gain a better understanding of the company’s sales cycle. Sales and revenue forecasting will lead to more efficient and effective cash flow predictions. With this type of forecasting, you can identify things like how many customers are likely to churn and how much cash the company can burn without leading to liquidity risks. ### 5\. Working capital optimization Working capital management is a vital part of cash flow forecasting. So, make sure that you have a solid grasp of your company’s current assets, accounts receivable, accounts payable, and how much flows in and out – and *when*. Optimizing working capital is one of the most effective ways to improve cash flow forecasting techniques because it gives you clarification on your projected cash positions over the next few weeks or months. ### **Key Takeaways** ✔️ Short-term cash flow forecasts are more accurate while long-term cash flow forecasts tend to be less accurate (particularly with newer businesses). ✔️ Develop different cash flow forecast scenarios and prepare action plans should your company experience financial deviations. ✔️ Consolidating cash flow data in one place using automation saves time and leads to more accurate cash flow plans. ### Join the Finance Alliance Slack Community *Sign up for our free Finance Alliance Slack community and start networking with other CFOs and finance leaders today!* *Share ideas, ask questions, discover new talent, and grow your network within one of the most engaged communities of finance professionals in the world.* [***Sign up to the Finance Alliance Slack community***](https://www.financealliance.io/community/) ***and introduce yourself, we can't wait to meet you (even if it is virtually!).*** ### Finance careers: How many jobs are available in finance? URL: https://www.financealliance.io/finance-careers-how-many-jobs-are-available-in-finance/ Last updated: 2024-02-16T15:45:52.000Z *\[Updated: 16.2.24\]* Thinking about pursuing a career in finance? Or perhaps you already have your foot in the door and you’re ready to take the next step in your finance career? Whatever the case may be, there are many jobs available in finance. The financial industry is bursting with career opportunities for rookies and experts alike. So, just how many jobs are available in finance? The answer is *a lot.* With so many options to choose from, it's difficult to know which is the right career path for you. That's why we’ve curated a list of some of the most sought-after roles to consider, covering: - [Chief Financial Officer](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#1-chief-financial-officer-cfo) - [Financial Controller](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#2-financial-controller) - [Financial Analyst](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#3-financial-analyst) - [Financial Adviser](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#4-financial-advisor) - [Chief Accountant/Accounting Manager](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#5-chief-accountantaccounting-manager) - [Treasury Manager](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#6-treasury-manager) - [Budget Analyst](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#7-budget-analyst) - [Finance Business Partner](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#8-finance-business-partner) - [Finance Manager](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#9-finance-manager) - [Director of Finance](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#10-director-of-finance-finance-director) - [FP&A Manager](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#11-financial-planning-analysis-fpa-manager) - [Chief Investment Officer (CIO)](https://www.financealliance.io/p/1147dafa-0cf4-44d0-af0d-44695ce5ec97/#12-chief-investment-officer-cio) ### 1\. Chief Financial Officer (CFO) The Chief Financial Officer, or CFO for short, is basically the money guru of any company. As a senior executive, the CFO oversees anything, and everything related to the financial health of the business. We're talking managing cash flow, prepping financial statements, dealing with taxes, and more. The [CFO](https://www.financealliance.io/top-10-cfo-skills/) is the one analyzing all those numbers and finances to make sure things are accurate and sound. When issues come up, such as profits sinking or costs ballooning, they build models to find solutions. On a daily basis, the CFO has their plate full of responsibilities like: - Putting together financial reports and statements - Working with the accounting and finance teams to make sure protocols are followed - Comparing income and expenses to find ways money is being wasted - Giving the executives and CEO recommendations based on the financials to guide big decisions - Liaising with investors and partners to establish relationships - Monitoring [cash flow patterns](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) and investments - Ensuring compliance - Overseeing anything related to $$$ - budgets, payroll, revenue goals, you name it! --- [CFO interview questions and answersIn this guide, we’ll help you prepare so that when you walk into that interview room (virtual or in-person), you’ll be ready to show them exactly why you’re the best person for the job.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2023/08/CFO-interview-questions-2.jpg)](https://www.financealliance.io/cfo-interview-questions-and-answers/) --- ### 2\. Financial Controller The main role of a Financial Controller is to supervise activities related to accounting within the company. For example, overseeing the preparation of budgets and making sure that ledgers are accurately showcasing how much cash is coming in and out of the company. Typical responsibilities for Financial Controllers vary from company to company, but may include: - Overseeing accounting and all financial control activities. - Setting up bank accounts. - Managing external tax accountants if applicable. - Ensuring payment is received from debtors and customers, etc. - Ensuring the company meets all tax, permit, and licensing requirements. - Supplying accurate financial information to executives to help guide effective financial strategizing. - Analyzing deficiencies and summarizing [budget trends](https://www.financealliance.io/budget-vs-annual-operating-plan/). ### 3\. Financial Analyst Tracking a company’s financial performance to decide whether they’re suitable for investment is the main responsibility of a Financial Analyst. But their workload doesn’t end there. Financial Analysts are responsible for a long list of tasks, such as: - Reviewing company accounts. - Financial forecasting, reporting, and tracking key metrics. - Creating financial models to help support business decisions. - Analyzing financial reports and data. - Interpreting data (yield, risk, stability, price, etc.) that contribute to a company’s viability. - Collaborating with other teams such as the accounting team to ensure accurate reports. - Evaluating the financial performance of the company and overseeing financial functions (tax, budgeting, planning, cost control, auditing, etc.). ### 4\. Financial Advisor With their acute organizational skills, Financial Advisors help companies manage money. Again, the role varies depending on the size of the company. However, a few of the common responsibilities of a Financial Advisor include: - Helping board members (such as the CEO) make informed decisions. - Researching financial products and presenting all the relevant information to help the company choose which products to invest in. - Assisting the company when it comes to building credibility and customer loyalty. - Completing [risk analyses](https://www.financealliance.io/5-supply-chain-risk-mitigation-strategies/) and researching the marketplace. - Building effective financial strategies. - Responding to the changing needs of the business. - Communicating with product suppliers for better rates. - Working closely with members of the head office, financial service providers, solicitors, valuers, and so on. ### 5\. Chief Accountant/Accounting Manager Chief Accountants have a wide range of responsibilities and oversee accounting operations. Making sure that financial transactions are reported and recorded properly (and on time) is an important part of the role. A Chief Accountant’s job role involves: - Performing financial analysis and month-end accounting activities. - Creating financial reports and statements and reviewing both for any errors. - Managing accounting procedures for compliance. - Monitoring cash flow to make sure debts are paid. - Building working relationships with regulators, external auditors, etc. - Conducting internal audits to assess the company’s financial management system. - Reporting to management as and when needed. --- [5-step stakeholder communication planA stakeholder communication plan is a strategic document outlining how a company will communicate with its stakeholders.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/stakeholder-communications-pla.jpg)](https://www.financealliance.io/stakeholder-communication-plan/) --- ### 6\. Treasury Manager This role involves overseeing a company’s cash flow, revenue, and other areas of finance. They usually report to senior staff such as the CFO. The Treasury Manager is often part of a larger finance team depending on the size of the organization. But what are some of the main responsibilities of a Treasury Manager? Here are just a few: - Managing cash flow, liquidity management, and banking relationships. - Assessing the company’s need for funding. - Helping to minimize financial risk. - Taking control of treasury operations and controls. - Managing foreign currency exposure and currency payments, etc. - Debt facilities and daily cash management. - Developing risk mitigation strategies and interest rate management. - Reporting treasury updates and activities to senior management. ### 7\. Budget Analyst A Budget Analyst evaluates the company’s budget and determines the most efficient ways to allocate resources (project funds). Some of the main responsibilities of this role include: - Reviewing budget proposals and assessing funding requests. - Performing [cost-benefit analyses](https://www.financealliance.io/cost-benefit-analysis/). - Deciding whether to approve or reject funding requests and submitting budgeting recommendations. - Developing a budget and a final budgetary agreement. - Forecasting the financial needs of the business. - Monitoring spending. ### 8\. Finance Business Partner The role of [Finance Business Partners](https://www.financealliance.io/finance-business-partnering-playbook-2/) is to help the business make strategic decisions to help secure its financial future. Finance Business Partners are also accountants that have stepped into the role of trusted advisors within the business. Here are a few of the key responsibilities of a Finance Business Partner: - Analyzing financial reports and helping management make strategic business decisions. - Monitoring business performance and helping to build key partnerships. - Gaining investment and updating shareholders. - Identifying and mitigating business risks. - Providing real-time support and analysis. ### 9\. Finance Manager The Finance Manager plays a vital role in the success of the business, providing financial guidance and support when needed. Main responsibilities: - Reporting, budgeting, and forecasting processes. - Monitoring cash flow, analyzing targets, and predicting trends. - Back-office duties such as accounts payable, payroll, and collection. - Providing data and insights that reflect the overall financial health of the company. - Liaising with department heads and accountant teams. - Ensuring the business meets statutory and compliance requirements. - Building strategic business plans to help influence business performance. ### 10\. Director of Finance/ Finance Director A Director of Finance has a huge role to play when it comes to any finance-related business decisions. They are responsible for ensuring the stability of a company’s finances and have a lot of important tasks to carry out, such as: - Assessing financial markets and trends. - Analyzing the company’s financial performance and risks. - Financial planning and monitoring cash flow. - Identifying solutions and providing insights to help drive business decisions, such as budget allocation and future investments. - Preparing accounts and creating financial models as needed. - Collaborating with other departments within the company. --- [12 proven strategies for managing liquidityLiquidity management is about ensuring your company always has enough cash, not just for the daily grind but also for tempting growth opportunities. It’s a financial balancing act that involves…![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/01/water-3007467_1280.jpg)](https://www.financealliance.io/12-proven-strategies-for-managing-liquidity/) --- ### 11\. Financial Planning & Analysis (FP&A) Manager [FP&A Managers](https://www.financealliance.io/fp-a-manager-salary/) oversee business forecasting and are able to predict possible future outcomes by reviewing past company performance while keeping a close eye on economic and business trends. The [FP&A](https://www.financealliance.io/fp-a-vs-accounting-key-differences-every-finance-pro-should-know/) Manager’s general responsibilities include the following: - Assessing a company’s financial health. - Providing commercial financial analysis on key KPIs. - Preparing internal reports to support leadership’s decision-making. - Identifying when and how the company can optimize assets, investments, and progression opportunities. - Working with other departments to prepare accurate budgets. - Building and maintaining financial models and forecasts. - Analyzing historical data, performing variance analysis, and paving the way forward. ### 12\. Chief Investment Officer (CIO) The responsibility of developing and communicating a company’s investment strategy lies with the Chief Investment Officer. They usually oversee and manage the company’s investments and have further responsibilities, including: - Sourcing, managing, and monitoring the company’s investments. - Developing an investment policy statement (IPS) and ensuring all investment policies are followed. - Developing (and communicating) the company’s investment strategy. - Working closely with external analysts, portfolio managers, and investors. - Building and managing the investment team. - Overseeing the entire investment process from start to finish. --- [Acquisition financing explained: Types & how it worksDone right, acquisition financing fuels growth. Done poorly, it can sink the whole ship. The sweet spot is structuring a deal that makes strategic sense and positions your now-bigger company for continued success into the future.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceRichard King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1200/2024/02/acquiring-financing.jpg)](https://www.financealliance.io/acquisition-financing/) --- ### How many jobs are available in finance? This list is just the tip of the iceberg when it comes to possible [finance career paths](https://nationalcareers.service.gov.uk/job-categories/business-and-finance) in finance. With so many roles to choose from, you can pave your own way and choose the best career path for you. Of course, we couldn’t list all of the jobs available in finance in detail in this post. But here are a few more that you might be interested in: ### Accountant Accountants prepare and examine financial records, ensuring accuracy and compliance with laws and regulations. **Tasks:** - Prepare financial statements and tax returns. - Conduct audits to ensure financial compliance. - Offer financial planning and advisory services. --- ### Auditor Auditors examine financial statements to ensure they are accurate and comply with laws and regulations. **Tasks:** - Review financial statements and accounting systems for efficiency and compliance with laws. - Identify potential financial mismanagement. - Report findings and recommend improvements. --- ### Head of Financial Crime This role involves leading efforts to prevent, detect, and respond to financial crimes such as fraud, money laundering, and financing of terrorism within an organization. **Tasks:** - Develop and oversee anti-financial crime policies and procedures. - Coordinate with regulatory bodies and law enforcement. - Train staff on financial crime risks and compliance. --- ### Equity Researcher/Financial Market Researcher Equity researchers analyze companies and industries to make investment recommendations. **Tasks:** - Analyze financial statements and market trends. - Produce reports on potential investment opportunities. - Advise investment teams and clients on stock selections. --- ### Bank Cashier/Clerk Bank cashiers or clerks handle the day-to-day financial transactions with customers at a bank. **Tasks:** - Process deposits, withdrawals, and other banking transactions. - Answer customer inquiries and offer banking products. - Maintain accurate transaction records. --- ### Bank Manager Bank managers oversee the operations and staff of a bank branch, ensuring efficient service and profitability. **Tasks:** - Manage branch staff and operations. - Develop strategies to attract and retain customers. - Ensure compliance with banking laws and regulations. --- ### Bookkeeper Bookkeepers maintain an organization's financial records, recording transactions, and preparing reports. **Tasks:** - Record financial transactions in ledgers. - Prepare invoices and manage accounts payable/receivable. - Reconcile bank statements and produce financial reports. --- ### Finance Administrator Finance administrators manage the day-to-day financial operations within an organization. **Tasks:** - Manage budgets and financial records. - Process invoices and payments. - Assist with financial reporting and forecasting. --- ### Investment Banker Investment bankers assist organizations in raising capital and provide strategic financial advice. **Tasks:** - Structure and negotiate financial deals. - Conduct market research and financial analysis. - Advise clients on mergers, acquisitions, and other financial transactions. --- ### Payroll Administrator Payroll administrators manage the process of paying employees, ensuring accuracy and compliance with tax laws. **Tasks:** - Process payroll transactions and ensure accurate employee payments. - Manage payroll taxes and deductions. - Address payroll-related queries from employees. --- ### Tax Examiner Tax examiners ensure individuals and businesses comply with tax laws by reviewing tax returns and conducting audits. **Tasks:** - Review tax returns for accuracy and compliance. - Conduct audits and investigations into tax issues. - Assess taxes owed and manage disputes. --- ### Treasury Analyst Treasury analysts manage an organization's financial assets, ensuring liquidity and optimizing financial performance. **Tasks:** - Manage cash flow and forecast financial needs. - Handle investments and debt obligations. - Develop strategies to mitigate financial risk. --- ## FAQs How many people work in the finance industry? The number of people working in the finance industry varies significantly across different countries and over time, influenced by economic conditions, regulatory changes, and technological advancements. As of the latest data, millions of individuals globally are employed in various sectors of finance, including banking, investment, insurance, and financial planning. Precise numbers would require consulting specific labor market statistics from relevant government departments or industry reports. What job roles are there in finance? The finance industry offers a wide range of job roles, including but not limited to Accountants, Auditors, Financial Analysts, Investment Bankers, Financial Planners, Risk Managers, Bank Tellers, Loan Officers, Insurance Underwriters, Tax Advisors, and Treasury Analysts. These roles span across several sectors such as banking, investments, insurance, real estate, and corporate finance. What is the highest finance job? IThe highest finance job can vary depending on the context and criteria used (e.g., authority, compensation, impact). Chief Financial Officer (CFO) is often regarded as one of the highest positions in finance within a corporation, responsible for managing the company's financial actions, strategy, and planning. In the broader finance industry, roles such as CEO of a major financial institution or managing partner at a top investment firm are also highly prestigious and influential. How do I start a career in finance? Starting a career in finance often begins with obtaining relevant education, such as a bachelor's degree in finance, accounting, economics, or business administration. Gaining internships or entry-level positions in financial institutions, networking, and pursuing professional certifications (e.g., CFA, CPA) can significantly enhance your prospects. Continuous learning and staying updated with industry trends are also crucial. Are finance jobs in demand? Finance jobs are generally in demand due to the critical role finance plays in the functioning of economies and businesses. Specific demand for finance roles can fluctuate with economic cycles, regulatory changes, and technological advancements. Areas such as financial technology (FinTech), risk management, compliance, and data analytics have seen growing demand in recent years. --- **If you’re looking for a new role in finance, consider joining the** [**Finance Alliance Slack community**](https://www.financealliance.io/community/)**. Inside, you'll find a library of resources, networking opportunities, and job opportunities posted by our members.** [Join our Slack community (it's free!)](https://www.financealliance.io/community/) ### Team CFO and CMO: Maximizing data to weather downturns URL: https://www.financealliance.io/team-cfo-and-cmo-maximizing-data-to-weather-downturns/ Last updated: 2023-03-09T12:44:32.000Z US GDP has contracted two quarters in a row and, whatever you call it, the current downturn is causing jitters. When economic times are tough, budget cuts follow, and my marketing colleagues know as well as I do that our budgets can seem like low-hanging fruit for firms looking to reduce spend. The narrative is often that CFOs and CMOs are at loggerheads in these situations. But both have the same goal – to drive sales and business performance and maximize spend. Analytic Partners data gathered from tracking hundreds of billions of marketing spend shows that, during the last recession, 60 percent of brands that increased their media investment saw ROI improvements. Brands that increased paid advertising also saw a 17 percent rise in incremental sales, while those that slashed spend risked losing 15 percent of their business to competitors. While wanting to cut marketing spend during periods of slow economic activity is an understandable instinct, data doesn’t lie. Slashing marketing investment does not protect margins because short-term savings are quickly undermined by dips in sales and brand equity, undermining revenues. Instead, doubling down on marketing will boost margins and improve ROI, putting brands in front of customers when their competitors are fleeing. Leaning into marketing during a recession has other longer-term benefits. As competitors give up on the attention ecosystem, the price of paid advertising declines, allowing advertisers to reach more customers with less spend. This is a fantastic opportunity to build long-term relationships and gain lasting market share because the customers you gain or support during the downturn are not customers your rivals can simply win back when the economy recovers. Of course, just throwing money at things isn’t the answer either. CMOs and CFOs can work together to ensure they understand marketing performance data and the organization’s short- and long-term marketing goals. Then, they can implement systems that monitor progress and optimize impact by tracking and quantifying the results of marketing spend. [How to build a culture of financial data analytics | Brian Kalish | Finance AllianceOur ‘new normal’ keeps changing and finance teams must adjust processes including people, process, culture, and technology to adapt. Confronting a historic level of uncertainty has rendered traditional methods of data analytics, forecasting, and scenario planning all but useless.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/sean-pollock-PhYq704ffdA-unsplash-2.jpg)](https://www.financealliance.io/how-to-build-a-culture-of-financial-data-analytics-to-develop-and-act-on-business-insights/) ## **Clarify short- and long-term goals** A well-defined plan with clear objectives and appropriate measurement tools works for both marketing and finance teams. While measurement is essential at any time, during a period of budget constraints, the need to demonstrate measurable impacts and agree to required outcomes is more important than ever. Marketing spend is not just about driving sales today but also about longer-term brand building and the cumulative effect of a holistic multi-channel marketing plan. While real-time analysis enabled by channels like paid search provides accessible and easily understood metrics, it doesn’t take longer-term strategies into account, nor does it measure the value of brand marketing. Being able to assess and measure the short- and long-term impacts of each element of your marketing spend makes marketing decisions clearer and more accountable and can demonstrate the long-term disadvantage of pursuing a purely short-term sales growth strategy. CFOs and CMOs working together can quantify and clarify these goals and identify the measurement tools that will monitor and assess outcomes. [How a startup CFO can lead a new company to success | Finance Alliance BlogAs the CFO of a startup, you have a huge role to play in navigating the company toward growth and financial prosperity.This article takes a closer look at the role of a startup CFO and how you can help your startup scale up...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/startup-CFO-road-image.jpg)](https://www.financealliance.io/how-a-startup-cfo-can-lead-a-new-company-to-success/) ## **Monitor progress and optimize** Marketing and finance leaders value data, and a strategic and transparent conversation between these groups hinges on the quality and accessibility of this data. By understanding how their organization, and organizations like theirs, have performed in the past, CMOs and CFOs can agree what the firm needs to continue to boost sales, build brands, and generate the required ROI. This means robustly tracking marketing data with systems and processes that can monitor and analyze it independently and against industry benchmarks. It also means enlisting the talent required to analyze the data and deliver insights in which actors across the organization have confidence. With the right data and a strong working relationship, CFOs don’t need to make knee-jerk requests for budget cuts, and CMOs don’t need to scramble to make the case for investment in marketing. Rather, business leaders can work together to ensure the data guides the decisions they make when preparing to weather a downturn. --- ****With major economic downturns appearing all across the world, how are you working with your CMO? Need advice on how to align your goals? Join the conversation with a global network of CFOs and finance professionals inside the [Finance Alliance Community Slack channel](https://www.financealliance.io/community/).** [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### How to build a culture of financial data analytics to develop and act on business insights URL: https://www.financealliance.io/how-to-build-a-culture-of-financial-data-analytics-to-develop-and-act-on-business-insights/ Last updated: 2025-04-07T10:19:56.000Z Our ‘new normal’ keeps changing and finance teams must adjust processes including people, process, culture, and technology to adapt. Confronting a historic level of uncertainty has rendered traditional methods of data analytics, forecasting, and scenario planning all but useless. Predictions for the return to business-as-usual, as far as scope and scale, remain wide-ranging. The old approach to the finance function is coming up short in an unprecedented crisis, but there *is* a path forward. Better yet, you can learn how to adjust to thrive and not just survive in the ‘new normal.’ But how? This article addresses exactly what this ‘new normal’ looks like for finance teams, particularly regarding financial data analytics, forecasting, and scenario planning. Topics covered in this article: - [What the new normal looks like for FP&A](https://www.financealliance.io/p/8b576d7a-4f38-4e97-879d-8c65162e25db/#the-new-normal-for-fpa-a-roadmap) - [Where your organization is on the FP&A maturity curve](https://www.financealliance.io/p/8b576d7a-4f38-4e97-879d-8c65162e25db/#where-is-your-organization-on-the-fpa-maturity-curve) - [Common pain points in financial data analytics](https://www.financealliance.io/p/8b576d7a-4f38-4e97-879d-8c65162e25db/#common-pain-points-in-financial-data-analytics) - [4 tips to build a culture of analytics](https://www.financealliance.io/p/8b576d7a-4f38-4e97-879d-8c65162e25db/#4-tips-to-build-a-culture-of-financial-data-analytics) - [Expected user experience & common data challenges](https://www.financealliance.io/p/8b576d7a-4f38-4e97-879d-8c65162e25db/#expected-user-experience-common-data-challenges) - [Traditional data analysis approach vs modern data approach](https://www.financealliance.io/p/8b576d7a-4f38-4e97-879d-8c65162e25db/#traditional-data-analysis-approach-vs-modern-data-approach) - [The game changer: direct data mapping](https://www.financealliance.io/p/8b576d7a-4f38-4e97-879d-8c65162e25db/#the-game-changer-direct-data-mapping) - [Financial data analytics maturity model](https://www.financealliance.io/p/8b576d7a-4f38-4e97-879d-8c65162e25db/#financial-data-analytics-maturity-model) - [The new normal: Forecasting](https://www.financealliance.io/p/8b576d7a-4f38-4e97-879d-8c65162e25db/#the-new-normal-forecasting) - [The new normal: Scenario planning](https://www.financealliance.io/p/8b576d7a-4f38-4e97-879d-8c65162e25db/#the-new-normal-scenario-planning) ## The new normal for FP&A: A roadmap The key to great forecasting and outstanding scenario planning is good data analytics. You need to think about how you represent your data because representation *matters*. Avoid overcomplicating it and remember Occam’s Razor and the Law of Parsimony, which states that "*entities should not be multiplied beyond necessity.*" In other words, if you’re given two solutions to a problem, the simpler one is usually correct. This theory was echoed by both George Box and Albert Einstein: > *“All models are wrong, but some are useful.” – George Box* > *“Everything should be made as simple as possible, but no simpler.” – Albert Einstein* ## Where is your organization on the FP&A maturity curve? The American Productivity and Quality Centre came out with a very interesting benchmark assessment called the [Planning and Management Accounting Open Standards Benchmarking Assessment](https://www.apqc.org/what-we-do/benchmarking/assessment-survey/planning-and-management-accounting-performance-assessment), which lets you know where you are on the FP&A maturity curve (*see slide below*). ![Maturity information available: financial data analytics](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.37.01.png) When it comes to information availability, 22% of survey respondents reported that real-time, internal and external data is readily accessible across the enterprise based on need. Data-driven planning is a similar story: ![data-driven planning](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.37.32.png) Around 29% of survey respondents report a robust data-driven enterprise planning and reporting capability. In doing so, organizations take a giant leap toward creating a culture of analytics for data-driven decision-making. ![Maturity: Data analysis](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.39.49.png) When asked questions about how they leverage data to assist with decision-making, only 18% reported using closed-loop self-adjusting algorithms to analyze real-time data: ![Maturity: monitoring/reporting performance](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.39.58.png) Concerning the maturity of monitoring and reporting operational performance, a decent number are producing regular scorecards/scoreboards with near-time data. However, only 19% of survey respondents use ‘closed loop’ real-time reporting and feedback systems in their day-to-day decision-making. So, what can we take away from these findings? Hopefully, by looking at this data, you can see that you’re not alone. Everyone's at a different point on the curve, and there's always room to grow. ## Common pain points in financial data analytics There are a few common pain points in data analytics that many organizations and finance functions struggle with. Take a look at them below and think about which of these pain points you believe is most prevalent within your organization: - Hard to access data from legacy systems. - Too many disconnected data sources. - Data accuracy concerns. - Limited real-time analytics/visualization. - Limited self-service reporting across the enterprise. Something that often gets left to the side lines when organizations want to do more with data analytics in finance is the importance of empowering your employees – including the FP&A team and your business partners. [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) ## 4 tips to build a culture of financial data analytics Here are four tips to empower your employees so they can also help build a culture of analytics to develop and act on business insights: ### 1\. Deliver consistent reporting and dashboards Increased speed, consistency, accuracy, and flexibility across all business units. ### 2\. Self-service reporting Users to utilize defined and governed metrics, product/location dimensions, and attributes as needed, to allow business analysis with recommendations for improvement. ### 3\. Drill-down capability The integrity of data is maintained as the user can drill down to the lowest level to uncover or discover. ### 4\. Exception reporting The ability for users to create exception reports to help direct focus and attention on meaningful insights. ## Expected user experience & common data challenges The [FP&A](https://www.financealliance.io/tag/fp-a/) team and business partners, etc., want five things when they’re dealing with financial data analytics: 1\. Speed 2\. Accuracy 3\. Consistency 4\. Time savings 5\. Flexibility Some of the most common data challenges that teams experience include: - Too much ETL. - Slow refresh times. - Poor query responses. - No actionable insights. - No self-service. Have a look through those challenges and ask yourself if your organization is currently battling with one or more of them. ![Common data challenges](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.40.29.png) From an FP&A perspective, one of the biggest challenges is having no actionable insights to work with. In the past, this was a very real issue in most organizations because the data was either not physically available, or it cost too much, or by the time we got the data, it just wasn’t timely. Nowadays, I’d argue that the data war has been won because the data is now basically free to access, it’s immediate and unlimited. The problem, though, is that it doesn't help the organization make better, faster, and smarter decisions. It’s great that we have access to the data but it’s not enough. We need to take data and convert it into insights, which is different than information. The business needs actionable insights to create enough knowledge to make better, faster, and smarter decisions. ## Traditional data analysis approach vs modern data approach Technology is driving a lot of our enhancements and our ability to do higher levels of finance data analytics. Here are a few slides showing how the data approach has evolved from traditional methods to a more modern data approach: ![traditional data approach](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.41.37.png) ![Modern data approach](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.41.59.png) ## The game changer: Direct Data Mapping ![The game changer: direct data mapping](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.42.08.png) Direct data mapping allows you to leave data in its source form. We can therefore pull out the pieces of data that we want, making it data relationship aware. When you make one change, you can make the same change throughout the entire system. It performs against billions of records, resulting in fast refresh times, fast query responses, and easy access to actionable insights on time. Another great thing about direct data mapping is that it enables self-service and it's ELT versus ETL. As FP&A professionals, we want to access our data as quickly as possible and in real time. So, here are a few snapshot examples of the type of reports that we’d like to have when we’re getting our analysis. ![Cost center cockpit sample](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.44.00.png) ![profit and loss - planning sample](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.44.07.png) ![sales dashboard - reporting sample](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.44.40.png) ### Data visualization It’s great to do the analysis, but we've got to be able to tell the story with [data visualization storytelling](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/). For example, my team can do the greatest analysis that's available, but if they present it to me in Danish, it doesn't mean anything because I don't speak Danish. So, a part of the onus on FP&A is being able to *tell the story*. The international communication standards advise that when presenting data, remember that similar things should look similar, and different things should look different. This is a semantic notation for better report comprehension. Here’s an example of dashboards with a semantic notation: ![Dashboards with semantic notation sample](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.54.42.png) Our research showed that when people consume things from a reporting system that uses a common platform, their error rate of reading the information drops by 61%, and the amount of time it takes for them to understand that data drops by 46%. ![IBCS reduces error rates - graphs](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.55.00.png) The main takeaway here is that there's a much better way to create your dashboards, reports, and presentations. ## Financial data analytics maturity model What type of financial data analytics do you generate primarily? - Descriptive - Diagnostic - Predictive - Perspective - Cognitive/self-learning The reason I ask is that it’ll help you place your organization in the analytics maturity model below more accurately. ![Analytics maturity model](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-10-31-at-17.56.03.png) Understanding where your company belongs within this model will help you better understand what you need to do to improve. It helps you to see where you are now, what happened, why did it happen, what will happen next, what should you do about it, and perhaps more importantly, what *don’t* you know? Descriptive and diagnostic analytics is historically where we've been in FP&A. It’s a little more on the reactive side, it’s the hindsight and some insight. It tells us what happened and where it happened. But you want to move to predictive analysis because it’s proactive, it helps the business understand what will happen. Beyond that, is moving into prescriptive analytics, which means you can better influence the company and positively impact top-line growth using optimization and foresight. We've got the people, tools, and processes and if we've got the right mindset, the organization can have whatever level of analytics it wants, as long as it's willing to invest. Here’s a look at the bigger picture of the analytics journey: ![The finance data analytics journey](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-11-02-at-17.03.04.png) In case you needed reminding, here are a few key reasons why data analytics is so important in the ‘new normal’ and beyond: - Data Analytics is increasingly critical during times of crisis. - Organizations are using data more often than before. - Organizations are reporting an increased need for data-driven insights than before. - Organizations are reporting they are increasing their spend on data analytics. ## The new normal: Forecasting When Covid-19 happened, we were at the onset of a global health crisis. For many organizations, it was like a bank of fog that rapidly and unexpectedly engulfed everything in its path. All of your tried-and-true navigation skills, processes, and how you would usually assess risks and opportunities were taken away and you had to rely on new ways to steer the organization on the right course. Forecasting in the fog wasn’t easy and suddenly, the models FP&A teams were using during Covid-19 were no longer useful for them. The reason is, having 20 years of history wasn't going to tell you about what's going to happen tomorrow or the next day. ![George E.P.Box quote - "Essentially, all models are wrong, but some are useful."](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-11-02-at-17.03.24.png) FP&A teams have been forced to change the cadence and many FP&A specialists are forecasting a lot quicker and perhaps more frequently than we have in the past. But why is forecasting so important in the ‘new normal’ and beyond? I believe there are three main reasons. Firstly, the need to know has never been greater. Secondly, the world we are operating in is in a constant state of flux. And thirdly, the drivers to the success of our organizations are constantly changing in importance. The world is constantly changing. So, our ability to be agile, and to forecast “on the fly” has never had a greater premium. ### Best practices in forecasting ![Best practices in forecasting](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-11-02-at-17.03.52.png) Here are a few tips to help you leverage forecasting to steer through times of uncertainty and navigate this new normal we’ve all found ourselves in: - Align your forecast with the strategy. - Implement rolling forecasts. - Consider a driver-based approach. - Remove excess detail. Match the level of detail with your predictive capabilities. - Expect the unexpected. - Improve your process through automation, and supercharge it with analytics. [Why leading CFOs prioritize employees’ mental health at workTo be a truly great CFO and leader, you need empathy and an understanding of mental health. In this article, I talk about the importance of addressing mental health and how you can better support your employees’ mental health at work, as well as your own.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Schöler![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/mental-health-at-work.jpg)](https://www.financealliance.io/why-leading-cfos-prioritize-employees-mental-health-at-work/) ## The new normal: Scenario planning In hindsight, many people around the world look back at what happened with the pandemic and wonder whether anyone could’ve predicted it. So, how could FP&A professionals have predicted both the pandemic occurring and the scope and scale of its impact? The simple answer is that we’re not fortune tellers. We don’t try to predict the future. Rather, FP&A professionals are about preparing for a range of possible outcomes, attaching a likelihood or probability of each outcome, and developing corresponding strategies to maximize the long-term benefit of the organization. But how do you mitigate uncertainty? Well, it's with planning, planning, and more planning. ![Dwight D. Eisenhower quote - "In preparing for battle, I have always found that plans are useless, but planning is indispensable."](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-11-02-at-17.04.02.png) Types of scenario planning include: - Quantitative scenarios - Operational scenarios - Normative scenarios - Strategic management scenarios ### Scenario planning: actions to take vs actions to avoid ![Scenario planning actions to take](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-11-02-at-17.04.37.png) ![Scenario planning actions to avoid](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/11/Screenshot-2022-11-02-at-17.04.44.png) There are three key steps to better best-case worst-case scenario planning: 1\. Identify critical triggers even amid uncertainty. 2\. Develop multiple scenarios but keep it simple. 3\. Build a nimble response strategy. Furthermore, a few key best practices for [successful scenario planning](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) involve assembling the right team, getting the right data, modeling with basic scenarios, and providing a break-even analysis. [How a startup CFO can lead a new company to success | Finance Alliance BlogAs the CFO of a startup, you have a huge role to play in navigating the company toward growth and financial prosperity. This article takes a closer look at the role of a startup CFO and how you can help your startup scale up...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/startup-CFO-road-image.jpg)](https://www.financealliance.io/how-a-startup-cfo-can-lead-a-new-company-to-success/) ## Why is scenario planning so important in the ‘new normal’ and beyond? The ability to respond quickly and pivot to any given change in our environment is critical and requires robust scenario planning. In this world of great uncertainty, knowing the most likely business scenarios permits organizations to maximize opportunities and minimize risks. Knowing and understanding the most probable and possible business outcomes, enable organizations to focus on the likely and avoid wasting resources on the unlikely. You can even think about scenario planning insurance for your business, in a way. It’s so cheap to plan versus how much it costs to react in a crisis. --- ### Key takeaways To truly thrive in the “New New Normal”, organizations need data analytics that: ➢ Keeps data in its source state ➢ Incorporates tools that are relationship aware ➢ Are able to perform against billions of records **Some other key takeaways include:** - Organizations must advance from simply providing Descriptive and Diagnostic Analytics to generating those mission-critical Predictive, Prescriptive, and ultimately Cognitive Analytics. - The frequency of Forecasting will be greater in the “New New Normal. - Organizations must leverage their People, Processes, Technology, and Mindset/Culture to meet this new reality. - Organizations must run robust scenario planning platforms to maximize the opportunities and minimize the risks that our highly uncertain world continues to throw in our path. --- ### About the author **Brian Kalish – Global Certified Corporate FP&A Professional** Brian Kalish is the Principal and Founder of Kalish Consulting, an Expert-in-Residence at eCapital Advisors and an Adjunct Professor at Florida International University. He has over 25 years of experience in Finance, FP&A, Treasury, and Investor Relations. Brian is also a public speaker and addresses many of the most topical issues facing FP&A professionals today. He has spoken all over the world and is committed to building and connecting the global FP&A community. He continues to host FP&A roundtables and events in North America, Europe, Asia, and South America. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### 7 ways founders can extend their cash runway URL: https://www.financealliance.io/7-ways-founders-can-extend-their-cash-runway/ Last updated: 2025-04-05T07:40:09.000Z While most industries suffered from the devastating economic repercussions of Covid-19, others saw tremendous growth. One such sector was the Technology industry. During this two-year period, Tech soared to a new level of success, which led to a complete funding frenzy among investors, especially VCs. The economy finally witnessed the perfect conditions for a thriving Tech startup ecosystem to flourish, with higher valuations and greater investments being poured into young startups, most noticeably at the seed funding stage. According to Pitchbook, “*More Tech startups crossed the $1 billion valuation threshold than in the previous five years combined*.” The combination of a booming economy and a growing Tech industry created the perfect recipe for young companies to secure funding for growth. Unfortunately, as we’ve seen time and time again, what goes up, must also come down. Now in the midst of a war in Ukraine, the ongoing effects of covid, and blows to the economy, experts are seeing a likely economic crisis looming in our near future. Topics covered in this article: - [How to approach an economic downturn](https://www.financealliance.io/p/815a1d6a-258f-451c-b5cd-6acdb8b0794d/#approaching-an-economic-downturn) - [Extending your cash runway](https://www.financealliance.io/p/815a1d6a-258f-451c-b5cd-6acdb8b0794d/#how-to-extend-your-cash-runway-advice-from-our-experts) - [Planning for success: How to prepare for takeoff](https://www.financealliance.io/p/815a1d6a-258f-451c-b5cd-6acdb8b0794d/#planning-for-success-how-to-prepare-for-takeoff) ## Approaching an economic downturn Because of the recent mixed public company earnings and the strong possibility of an incoming economic recession, tech startup valuations are declining, and rapidly. In fact, [Joyce Mackenzie Liu](https://designedtoscale.substack.com/p/how-to-play-offensive-in-a-recession?token=eyJ1c2VyX2lkIjoxMDk3NDc5MSwicG9zdF9pZCI6NTY0MjcyNTcsIl8iOiJ0SW5ZUiIsImlhdCI6MTY1MzU3OTUzMywiZXhwIjoxNjUzNTgzMTMzLCJpc3MiOiJwdWItMjk3MDIiLCJzdWIiOiJwb3N0LXJlYWN0aW9uIn0.UyAvh5G43gBN0D8b2CZHQ-zDXRsHInkE%5FCKbDC90u80&s=r), CFO, and founder of Pegafund, reported that Tech startup valuations have plummeted by **30-50%** over the past year, with the bulk of this decline occurring over the past two months. Joyce also states: > “While current financial health remains similar, public Cloud companies are now trading on **current revenue multiples of 9.7x and 7.5x** for top and median quartile businesses, respectively, with investors placing a premium on companies that have a balanced mix of revenue growth, margins, and capital efficiency. (This is in contrast to the emphasis on forwarding 12-month revenue which we experienced in recent years.)” Investors are now proceeding with caution as the economy continues to adjust. Because of high inflation, market volatility is trending upward, leading experts to believe that the IPO market will remain closed until further notice. ### What does this mean for tech startups? So what does all of this mean for founders in the startup ecosystem? It means it is time to adapt, hunker down, and ride this wave until we can see the light at the end of the tunnel. One of the best ways startups can go about this is to extend their financial runway. According to [CB Insights](https://www.cbinsights.com/research/startup-failure-reasons-top/), one of the most common reasons startups fail is because they run out of runway. To avoid this, you must learn how to reduce your cash burn and extend your runway as quickly as possible. Our FP&A Ops team has put together this comprehensive guide to help your organization brace for the bumpy journey ahead. In this article, we will be covering everything you need to know on how to control costs and extend a company’s cash runway during times of uncertainty. [How a startup CFO can lead a new company to success | Finance Alliance BlogAs the CFO of a startup, you have a huge role to play in navigating the company toward growth and financial prosperity. This article takes a closer look at the role of a startup CFO and how you can help your startup scale up...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/startup-CFO-road-image.jpg)](https://www.financealliance.io/how-a-startup-cfo-can-lead-a-new-company-to-success/) ## How to extend your cash runway: Advice from our experts The future is inevitable. Instead of being reactive on the sidelines and watching the market unfold, take a more hands-on approach by adopting these simple principles below. **The 7 ways founders can extend their cash runway include:** 1. Calculate your Net Cash Burn Rate 2. Be cautious of your timeline 3. Reduce expenses 4. Raise prices 5. Prioritize scenario planning 6. Reforecast for success 7. Improve the efficiency of your tech stack Below, we will be exploring each of these points in depth so your team can start implementing these practices as soon as possible. ### **1**. Calculate your Net Cash Burn Rate The net burn rate is a critical metric that showcases the rate at which a company uses up its cash reserve in a loss-generating scenario. This number can be calculated by subtracting the operational expenses from the revenue generated. Typically, a company that is pre-revenue has a cash burn rate that is equal to its operational expenses. Startups that are looking to stretch their funding further must control and slow down their month-over-month net cash burn in order to stay afloat until their next funding round. Many startups will often calculate burn multiples, which illustrates how much a startup is burning in order to generate each dollar of ARR. As a rule of thumb, the lower the burn multiple, the more efficient a company is growing. For companies that are considered a venture-stage startups, consider following these [multiples](https://medium.com/craft-ventures/the-burn-multiple-51a7e43cb200#:~:text=Burn%20Multiple%20%3D%20Net%20Burn%20%2F%20Net,achieve%20each%20unit%20of%20growth): - Under 1x → Amazing - 1-1.5x → Great - 1.5-2x → Good - 2-3x → Suspect - Over 3x → Bad ### 2\. Be cautious of your timeline If a runway is too short, a plane will never be able to take off. The same concept goes for startups. But how long is a startup expected to survive during these difficult times? According to [CB Insights](https://www.cbinsights.com/research/days-between-funding-rounds/), a startup should have a runway of 18 to 24 months. Anything less, and a company puts itself at risk of going under. CB Insights conducted a study to analyze the average runway time for startups at different stages. The findings can be seen in the graph below:‍ ![runway time for startups](https://uploads-ssl.webflow.com/60cc684a8bf9116327e503e5/62a053f0ab80727fd65f9a85_njWMy99aRQE4_0Zy2bJ1loL59TjUppHX712mdYpmxVYTELjemgG3kl2kQjKgAU8oFogYRFDq_9dmqNJc6yGximDbExgipetmz0idm8wqrC1dyYbMNCk_unNWafrU2MTb4glcbbx6r2j9ZPz2FQ.png) ### 3\. Reduce expenses If you are currently looking to extend your startup runway, cash conservation should be your number one priority. Reducing operating expenses is one of the easiest ways to stretch your cash reserve further. A few ways to reduce expenses as a startup might include: - **Slow down hiring**: Bringing on a new team member can be expensive. If you have been rapidly growing your team, slow down and only prioritize the most critical positions that need to be filled. If you find yourself with only three to six months of runway left, you may be forced to lay off employees. While no founder wants to have to make this decision, headcount is often the biggest expense for a company and can be the difference between life, or death for a struggling startup. - **Rethink your office space:** Do you currently pay a lease for an office space or coworking space? If you want to cut down on operating costs, consider downgrading to a smaller office space or adopting a fully remote working policy. - **Prioritize spending:** What tactics have previously brought success to your organization? Whether it's focusing on sales or marketing initiatives or doubling down on product development, invest in outlets that have a proven track record for supporting growth. From there, cut or reduce spending on all other areas that do not positively impact your bottom line. - **Cut ad spend:** It’s common for startups to pour money into ad spend. Companies will set MRR objectives and adjust their ad spend accordingly to help them reach their targets. While ad spend may help bring in leads and ultimately close deals, this investment often comes at a high cost. As companies continue to scale, their advertising budgets must also increase to keep up with this increasing MRR target. Startups in danger of going under should cut ad spend and focus on growing their revenue more sustainably. While a company's growth rate will take a hit, this is one of the immediate ways for startups to cut costs and stay afloat. ### 4\. Raise prices Often, startups under-price their products and services to start acquiring customers and generating revenue. However, once you start growing your customer base, gaining visibility on the market, and having a clearer positioning, you need to make sure that your pricing is more aligned with the value you deliver. If you are a founder struggling to break even, consider raising your prices to increase revenue. Start by increasing your pricing plan for new customers, and if needed, adjust your prices slightly for existing clients as well. This requires a high level of tact, as the last thing you want is for them to churn. As long as your product or service offering is robust, they are very likely to see the value and keep using it. ### 5\. Prioritize scenario planning Scenario planning is the process of making assumptions about the future and predicting how your business will be affected. By preparing for what could happen, you will better be able to react and respond to forthcoming obstacles. This process gives organizations the power to go from reactive to proactive in their strategic planning initiatives. In today’s market conditions, the only way a company will be able to stay alive is if they are able to adapt at a moment’s notice. Right now, companies should be focusing on three main scenarios. These include: - Growth-at-all-costs - Sustainable growth - Survival By creating strategic financial plans around these three scenarios, organizations will better be able to adapt as an economic dip unfolds. [Why leading CFOs prioritize employees’ mental health at workTo be a truly great CFO and leader, you need empathy and an understanding of mental health. In this article, I talk about the importance of addressing mental health and how you can better support your employees’ mental health at work, as well as your own.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Schöler![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/mental-health-at-work.jpg)](https://www.financealliance.io/why-leading-cfos-prioritize-employees-mental-health-at-work/) ### 6\. Reforecast for success Reforecasting allows organizations to course-correct as needed. By taking a more strategic approach to financial forecasting, leadership can identify challenges, seek out opportunities, and create a clear roadmap moving forward. Reforecasting also paints a clearer picture for senior management of which scenario the company is falling into. By analyzing these insights, companies can improve their agility and make faster decisions while planning for the future. When implementing a financial reforecasting plan, startups should be focusing on these key KPIs and metrics: - Customer acquisition cost - Cash conversion cycle - Net revenue retention - Revenue expansion - Cash runway - EBITDA - Net burn These metrics will allow senior management to take a pulse on an organization’s overall health and track organizational performance. ### 7\. Improve the efficiency of your tech stack With the market being so unpredictable, it can be hard for companies to plan for the long term. Most finance teams use an Excel spreadsheet to manage their financial data, however, this manual process can be tedious, prone to human error, and difficult to build for multiple scenarios. In order to save your finance team valuable time for more strategic analysis initiatives, automate these processes by implementing a strategic finance solution, also referred to as FP&A software. While your team may want to cut costs, it's still essential that you are prioritizing the right tech platforms to support growth. Not only does an FP&A software help improve data quality, but it also allows finance teams to stay agile and make the right decisions for the next 18 to 24 months… and longer! ## Planning for success: How to prepare for takeoff We can all agree - the future is uncertain. Unfortunately, no matter how much we plan, no one knows what will happen in the coming year. What we can do, however, is stay prepared, tactical, and agile for what has yet to come. If you’re prepping your company for takeoff, now is the perfect time to buckle up and strategize. By following these tactics above, you’ll be able to navigate the storm with a healthy runway and set your company up for a future of growth and success - even if a bit of turbulence might come your way. --- ### How a startup CFO can lead a new company to success URL: https://www.financealliance.io/how-a-startup-cfo-can-lead-a-new-company-to-success/ Last updated: 2025-04-05T07:40:39.000Z How can you succeed as a startup CFO? While a full-time CFO might not be on the cards for startups with modest budgets, some want to hire a CFO to help set the business up for success. As the CFO of a startup, you have a huge role to play in navigating the company toward growth and financial prosperity. This article takes a closer look at the role of a startup CFO and how you can help your startup *scale up*. ### Key talking points include: - [What is the role of a CFO in a startup?](https://www.financealliance.io/p/1d8e02c6-ed9f-44c0-aeeb-14b65a1bce47/#what-is-the-role-of-a-cfo-in-a-startup) - [CFO startup responsibilities](https://www.financealliance.io/p/1d8e02c6-ed9f-44c0-aeeb-14b65a1bce47/#cfo-startup-responsibilities) - [How to be a CFO of a startup](https://www.financealliance.io/p/1d8e02c6-ed9f-44c0-aeeb-14b65a1bce47/#how-to-be-a-cfo-of-a-startup) ## **What is the role of a CFO in a startup?** The startup CFO role is mainly focused on preparing the company for fundraising, building the finance function, filling key financial roles within the company, and ensuring general compliance. The specifics of your role as a startup CFO will vary from company to company. But there are a few common threads that run through the CFO role no matter *what* company you work for. Namely, helping to grow the company and providing financial insights to steer decision-making and lead the company to success. [How to use data visualization storytelling to transform FP&AWant to learn how to tell compelling stories with data? Discover techniques to improve your data visualization storytelling skills right here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/data-visualization-storytelling-2.jpg)](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) ## **CFO startup responsibilities** A startup’s main goal is to grow and become as profitable as possible. The CFO has an active role in helping the company meet that goal. But how? Here are a few of the most important responsibilities of a startup CFO: ### Partnering with the CEO As a valued member of the C-Suite, you’ll brush elbows with some of the big leagues within the company, including the boss. The most successful CFOs are those that make a conscious effort to develop a collaborative partnership with the CEO. Partnering with the CEO is important because you’ll work very closely to help grow the business. So, listen to what the CEO has to say, and gradually, over time, you’ll get better at anticipating their needs and providing sound advice that they can trust. Here are a few ways CFOs can support the CEO: **1\. Build a foundation of trust** CEOs must trust their CFO with important and often highly confidential information related to the business and finances. The CFO must earn the CEO’s trust so that they can express their opinions openly and discuss matters with mutual trust and respect. **2\. Strive for open and honest communication** The CEO must trust that their CFO can deliver data insights in a way that they (and other management teams) can understand. Communicate complex issues in simple terms where possible. And always strive for open and honest dialogue. **3\. Know the business inside and out** You need to develop a good understanding of the business strategy and how the business works across each department. Learn where the CEO sees the business going, and how they plan to get there. **4\. Challenge the status quo and drive positive change** The CEO doesn’t expect their CFO to enter the business and blindly accept the status quo. CEOs want their CFOs to voice their opinions and challenge the business to push toward a more profitable future. **5\. Become a strategic business partner** CEOs need more than a C-Suite member who's good with numbers. They need their CFOs to be strategic business partners and help them make strategic business decisions. To find out more about how you can build a stronger partnership with your CEO, check out our article – ‘[5 ways CFOs can support the CEO](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/).’ [CFO and CEO relationship: 5 ways a CFO can support the CEOIn this post, you’ll learn what a CEO needs from their CFO, and what you can do to support the CEO on a day-to-day basis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/handshake-g5cf73343d_1920-1.png)](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/) ### Building the finance function Startup CFOs are highly focused on maintaining and improving key finance functions and responsibilities. Capturing and analyzing financial data is a massive part of the role of a CFO in a startup, which covers everything from accounting and controlling, to forecasting, budget management, cash flow management, reporting, and so on. Growing businesses often lack the necessary people and teams they need to continue to grow. So, don’t be surprised if you’re given the green light to build the finance function from the ground up and construct your ‘dream finance team’ at the same time. Avoid overcomplicating things by filling roles for the most important functions first. For your startup, this might include hiring someone (or a team) to fulfill the following roles: **Accounting** \- You can hire in-house or outsource a company or individual to handle accounts in the early days when transaction volumes are relatively low. **Controllers** – Reviewing data, ensuring accuracy, and identifying pain points are all responsibilities that fall under the controller’s umbrella. They’ll also help make sure that the company complies with local/global rules and regulations. **Finance operations** – It’s one thing to have a shiny tech stack that promises to streamline all your finance processes, but they’ll go to waste if nobody knows how to use them. A finance operations team will be able to implement tools and software successfully and ensure everyone who’ll be using them knows *how*. **Financial planning and analysis (FP&A)** – FP&A provides the reports, forecasts, and strategic advice needed to scale the company. ### Fundraising From targeting the right venture capitals (VCs) to prepping for due diligence and managing the runway, there’s a lot to consider when it comes to raising funds for startups. In the early stages, the CFO must help choose the best VCs for the company. When considering a VC, you’ve got to consider not only the source of capital but if it'll be the best partner for your startup. Remember that timing is *everything*. If you wait until the last minute to raise funds, you’ll run out of runway a lot quicker. On the other hand, if you start too soon, you may lack the necessary metrics to demonstrate market opportunity, growth, and product-market fit. You should also perform internal reviews beforehand to ensure that the company is prepared and in the best possible position so that when investors consider funding the company, they’ll like what they see. During the fundraising process, the CFO must support the pitch with presentations that tell powerful stories with data. You’ll also be the investors' internal point person, which means you’ll be the one negotiating on the company’s behalf. Once you’ve locked an investor, you’ll have to keep track of the burn rate and take control of the cash/runway management. ### Human resources A good CFO will have polished people skills and will usually be well-liked within the organization. As a key member of the C-Suite, you can expect to be heavily involved with your team and how it operates. This includes hiring new members of the team and being involved in the firing process if necessary. Managerial skills are a *must* and even though your background is in finance, HR involvement will likely be a key part of your role as a startup CFO. As the company grows, you may be able to release some of the workloads to a specialized HR person. But until then, the CFO will usually hold a lot of the HR responsibility within a startup company. ### Legal One of the most important CFO startup responsibilities is ensuring legal compliance. Don’t worry, you don’t need to start law school and become a qualified lawyer by any means, but you’re expected to be able to build legally compliant processes throughout the finance function and the business as a whole. You’ll need to develop a solid understanding of the financial legal laws and regulations of the country your startup operates in. If necessary, you’ll also require in-depth knowledge of relevant foreign laws, particularly if your company merges with another in a different country, for example. The company may hire a lawyer eventually. But for now, you can expect most legal responsibilities to sit with you and the finance team. [Why leading CFOs prioritize employees’ mental health at workTo be a truly great CFO and leader, you need empathy and an understanding of mental health. In this article, I talk about the importance of addressing mental health and how you can better support your employees’ mental health at work, as well as your own.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Schöler![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/mental-health-at-work.jpg)](https://www.financealliance.io/why-leading-cfos-prioritize-employees-mental-health-at-work/) ## **How to be a CFO of a startup** As the CFO of a startup company, you’ll wear more than one hat. This means you’ll have to juggle a range of responsibilities that aren’t always siloed to the finance function but extends to other parts of the business too. So, how can you set yourself up for success as a startup CFO? Let’s break it down.👇 ### Start with the basics When you first join a startup as the CFO, it can be tempting to jump right in and start doing all the things at once. However, when it comes to building a finance team from scratch, it’s better to start with the fundamentals and build out from there. Take time to make sure that the company’s accounting practices, data analyzing processes, and so on, are all in working order before you start bringing in more people and new systems and processes, etc. ### Keep potential risks at the forefront While it’s important to help the business to grow, it’s also vital that the startup CFO helps to mitigate risk in key areas of business and the law, including: - Outstanding litigation or potential claims (e.g. lawsuits, open claims, etc.) - Employee payroll (benefits programs, certain clauses) - Local and sales tax compliance - Tax incentives - Audit requirements - Financial impacts - Ethics and fraud reporting - Debt agreements and covenants - International operations - Customer/vendor concentration risk - Insurance gaps/regulatory requirements - Cybersecurity and resilience - Customer data privacy and compliance ### Focus on scalability and driving strategic business planning What does every startup want more than anything? You’ve guessed it – they want to scale (preferably, sooner rather than later). If you want to impress, emphasize scalability. Gain a holistic understanding of the business and develop a strategic view of how it remains profitable. What is driving top-line revenue? Engage with other departments and step into the role of a business partner. Build a working relationship with other functions, such as the go-to-market team, and learn as much as you can about their vision, the product/service, and how finance can add further value and help achieve revenue objectives. As the CFO, you’re in an optimal position to drive hypergrowth for your startup company. By focusing on scalability, long-term value creation, and strategizing key business decisions, you can have an active role in driving growth, which will put you in a good position to thrive within your role. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### Financial planning in uncertain times: Advice from leading finance experts URL: https://www.financealliance.io/financial-planning-in-uncertain-times-advice-from-leading-finance-experts/ Last updated: 2022-11-30T08:38:21.000Z Life as a finance professional is anything but smooth sailing and if recent times have taught us anything, it’s that a major crisis can strike at any time, anywhere. From navigating a global pandemic to preparing for a potential financial crisis on the horizon, there’s a lot of responsibility resting on your shoulders. So, how should you approach financial planning in uncertain times? Here are some words of advice from a few of the speakers at the [FP&A Summit 2022](https://summit22.financealliance.io) when we asked them the question at the top of everyone’s minds… ### *What advice can you give for financial planning in turbulent times?* ## Chris Ortega - CEO of Fresh FP&A ![Chris Ortega - financial planning in uncertain times](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/Screenshot-2022-10-13-at-09.38.35-1.png) “The advice that I would give to FP&A as we continue to navigate uncertainty is: **1\. Don’t try to balance prevision vs accuracy** With this level of uncertainty, don't try to balance precision versus accuracy inside it. In other words, don't try to be perfect in what you're trying to expect. Try to be precise in the next 90 days of any of your budgeting or forecasting. **2\. Stay connected with your business partners** Another piece that I would give is to stay deeply connected with your business partners. Build that collaboration, build that communication, build that community of knowledge and information to share directly with your business partners. **3\. Develop a scalable roadmap** And the third piece as you continue to navigate this uncertainty and challenge and turbulence that we're all experiencing is making sure that you're developing a financial transformation or scalable roadmap that you're looking to execute in the next 6 - 12 months. Plan your processes, plan the work, and make sure you work with the plans.” ### About Chris Chris is a dynamic, empathetic, and servant financial leader with extensive experience in finance, accounting, financial planning and analysis (FP&A), strategic planning, and financial leadership. He’s a seasoned leader with a proven track record building and shaping domestic, multinational, and international matrix finance organizations. He started his career in public accounting at EY and has experience in seed to enterprise companies leading the finance organization. His current position is CEO of Fresh FP&A which is a consultancy focused on finance transformation and scalable solutions for businesses. ## Lindsay Jespersen – CFO of Plex ![Lindsay Jespersen - financial planning in uncertain times](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/Screenshot-2022-10-13-at-09.40.47-1.png) “Our contributions as finance leaders play important and strategic roles in navigating transformation in this age of accelerated digitization and uncertainty. I think we can all attest to the fact that finance as a function only continues to broaden. And our financial insights help drive not only executive-level decision making, but the full range of daily operations over the course of a business's lifecycle, and ultimately, how well it competes in its market. We know that today's macro shifts in global economies are very likely to impact us all in these next few months and over the course of 2023 and 2024\. And how will we prepare ourselves now will be indicators of how well we navigate all that's ahead.” ### About Lindsay Lindsay was appointed Plex’s first Chief Financial Officer in August 2021 to lead the global media streaming company’s finance, accounting, legal, and strategic planning functions through its next phase of growth. Lindsay has 20+ years of experience in strategic and operational finance roles at major media companies and has held leadership roles at Bloomberg Television, ViacomCBS, and GE. She previously served as Vice President of Finance for Comcast NBCUniversal’s Global Distribution & International segment and prior to that, as Vice President of Finance & Strategy at the Walt Disney Company where she led a global team responsible for the financial operations of ABC News. [FP&A Summit 2022: Hear from our keynote speakersFinance Alliance is pleased to announce that our first virtual event – the FP&A Summit, will be held on November 9 – 10 2022, and it’s 100% free!🔥![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/FP-A_Summit_NOV22_Assets_-2.jpg)](https://www.financealliance.io/fp-a-summit-2022-speakers-quotes/) ## Osman Belal – FP&A Director of GE Renewable Energy ![Osman Belal - financial planning in uncertain times](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/Screenshot-2022-10-13-at-09.41.08-1.png) “I think of the changes impacting the finance function, a key topic that will continue to be top of the agenda next year is expectations for the work environment, and team engagement, development, and retention. A key word of advice generally in planning and even more so in turbulent times is working closely with the operating team in defining the plan and discussing the underlying assumptions for the key metrics. Most likely the operating teams have insight into leading indicators that influence the financial performance of the business. And it's good to get these inputs during the planning stage.” ### About Osman Osman is a finance leader with 10+ years of experience in various areas of Finance including Controllership, Commercial Finance, Supply Chain Finance, Transformation, Financial Planning & Analysis, and Executive Board roles. In his current role, he is an FP&A Director in GE Vernova, where he is responsible for financial planning, analysis, and reporting processes and outcomes for a business in the group. Osman’s experience was gained in both Financial Services and Industrial companies. He has worked and lived in 6 countries across NAM, Asia, and EMEA with his current role based in France. He is a CFA charter holder and an Alumni of Tsinghua-INSEAD EMBA. ## Stephen Newland – Director of FP&A at GrowthLab FaaS ![Stephen Newland - financial planning in uncertain times](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/Screenshot-2022-10-13-at-09.40.57-1.png) “Well, I think there are two key things, I think one is just taking the time away from the day-to-day of the business just to pull back and really put the planning hat on. It's really tough to plan when you're so busy in the day-to-day and so you really have to be intentional with that. Number two would just be setting a regular cadence to review performance and review the financials, again, when we get so busy and it's easy to fall out of cadence where we are regularly reviewing the financials and kind of putting that planning hat on. So those would be the two tips I would say about financial planning in turbulent times.” ### About Stephen Stephen is the Director of FP&A at GrowthLab Financial. He leads a team of analysts responsible for developing financial models, analyzing business valuations & providing ongoing financial support to a number of startups and small businesses. Stephen has worked in a finance role at a variety of organizations including startups, early-stage companies, non-profits, and Fortune 500. ## Grab your tickets to FP&A Summit! If you want to hear more advice from our amazing speakers about financial planning in uncertain times and other topics, make sure to join us on November 9th and 10th for our free virtual event, the FP&A Summit, which consists of 2 days packed with insightful leading content from over 15 keynote speakers and finance experts. [👉 GRAB YOUR TICKET👈](https://summit22.financealliance.io/checkout/select-tickets/) If you’re reading this post after the event has ended, don’t worry! Our next event is right around the corner (more details below*👇).* *Wanna learn more about financial planning and analysis? Join our panel of experts from Google, E-Capital, HDMI, and more at the *[FP&A Summit](https://events.financealliance.io/location/sandiego)* in *San Diego* on *March 8th – 9th 2023*. They’ll be exploring forecasting in uncertain times, [mastering FP&A](https://events.financealliance.io/location/sandiego/agenda) to establish predictability in times of change, and more.💡* *Join our attendees for a 2 day event that will feature keynotes, panels, and more from top industry decision makers to equip you for future challenges and help you unlock your career potential. *Register now before tickets run out!* 👇* [FP&A Summit | San Diego![](https://storage.googleapis.com/acara-assets-production/production/organizations/62876e34645e9fcb6e4019c8/1668182122230-FA-Icon-Colour-No-Background-Padding-01.png)San Diego![](https://storage.googleapis.com/acara-assets-production/production/organizations/62876e34645e9fcb6e4019c8/1666708747126-FP-and-A-Meta-2023-2.jpg)](https://events.financealliance.io/location/sandiego) ### CFO: Communication skills URL: https://www.financealliance.io/cfo-communication-skills-framework/ Last updated: 2024-06-20T13:44:14.000Z If you want to be a successful CFO, it’s time to brush up on your people skills. Communication is a big part of the CFO's role because they talk to a variety of people. This includes board members, shareholders, investors, suppliers, customers, and employees. The CFO of tomorrow must be a superb communicator. They must be able to share company messages with people outside of the organization as clearly as possible. And… they’ve got to have a knack for communicating complex information (such as data insights) to people who lack the same level of understanding. So, whether it's explaining the financial rationale behind a tough decision that had to be made or sharing updates on the company's overall financial health and vision for the future, the way a CFO communicates can have a *huge* impact. It shapes team morale, instils confidence in stakeholders, and helps align everyone around the company's strategic direction. ### 10 principles that'll make your finance transformation successful URL: https://www.financealliance.io/10-principles-thatll-make-your-finance-transformation-successful/ Last updated: 2022-10-18T12:14:22.000Z The term ****Finance Transformation*** is sometimes used for implementations of new ERP or other finance systems, or for introducing automation. A good Finance Transformation is so much more. It addresses all five areas of the target operating model: People, Process, Technology, Data, and Information. To truly transform a finance function into one that gets more efficient and effective each year, you need a transformation that does not begin or end with technology. Below are my 10 principles of finance transformation: ## People Transformation means change. Massive change. The People part of the target operating model is critical because you cannot **transform* your finance organization *without* changing its culture. ### 1\. Invest in staff This principle is based on the premise that a finance organization’s capability is the sum of the capability of its people. Investing in the skill development and alignment of the staff pays off. Creating an environment where continuous growth and development of the individuals is embedded in the team's culture **really* pays off. ### 2\. Embrace change management There is a whole discipline and industry around change management and it's foolish to think you can manage the change of a transformation by just figuring it out as you go. Adopting best practices in this area can help you manage the change for everyone. Change management covers a spectrum that includes sharing a common vision for the future state, addressing “what’s in it for me” for each person, providing training and upskilling, and assessing org readiness for new technology. ## Process Focusing on process improvement before technology changes is a critical success factor for Finance Transformation. Expecting your process to be defined by your new software is a common (and expensive) mistake. ### 3\. Adopt Lean Finance When it comes to process improvement, there is no need to reinvent the methodology. Lean principles, which began in automotive manufacturing, have been adapted across all sorts of business lines and functions. I have successfully adapted the tools and principles to create Lean Finance organizations. To build a strong foundation for your transformation, make Lean Finance principles a part of the culture and apply Lean tools and methods to improve your team’s processes. To find out how to make your finance team lean, you can read my previous article on this topic below: [How to make your finance team leanIf you want to develop a world-class finance team, you’ve got to embrace lean finance. In this article, you’ll discover the five principles of lean finance for transformative results.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceChris King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/heidi-kaden-XvPsA9Riev4-unsplash-2-2.jpg)](https://www.financealliance.io/how-to-make-your-finance-team-lean-5-principles-of-lean-finance/) ### 4\. Organize by process groups The best organizational unit on which to focus improvement efforts is the process groups. These groups probably align pretty well with your organizational structure already. A process group is a team responsible for a group of related processes (e.g., Collections, Cash Applications, Accounts Payable, G/L Accounting, Cost Accounting, FP&A, Tax Reporting, etc.). The right group will vary slightly for each company. At this level, you can identify the objectives, improvement targets, and metrics for a team to work on as well as the Process Group Owner to lead the team. One of the Lean Finance principles is Empowerment. Empowering these teams to make improvements in their own areas is the key. ## Technology Process Groups should use technology to enable improvements in efficiency and effectiveness. The role of new or improved technology will be clear after the People and Process work is well underway. Implementing new systems should not be the primary driver of your Finance Transformation. More importantly, do **not* charge the third parties you need to implement new systems with change management toward a new culture or the development of your people. ### 5\. Optimal Use of Existing Technology Many Finance organizations start their Finance Transformation believing that the key is implementing new technology. They almost always have best-in-class technology solutions in their organizations that they are not using well. These might include Excel, Blackline, Concur, Power BI, etc. If you consider all the technology solutions currently deployed, do you think the software providers would say you were in the top quartile of all their customers in terms of: - How well it has been implemented? - How well staff has been trained? - How much functionality is being utilized? - How well benefits have been realized? Addressing the root causes of these issues and improving the utility of existing technology should come first. ### 6\. Effective implementation of new technology If you don’t already have competency in effectively implementing new technology, I suggest you develop it before starting on multi-year, multi-million-dollar system implementation. You cannot outsource the responsibility for successful implementation to others. All the software providers and implementation consultants you are considering have both successes and failures in their past projects. It’s not the contract that protects you against failure. It’s a leader’s willingness to lead the whole team (internal and external) and establish trust and teamwork, to get into the details of the messy middle, and be the glue that prevents critical items from slipping through the cracks. I call it **active sponsorship* and it is the opposite of being ready to distance yourself from failure. [How to use data visualization storytelling to transform FP&AWant to learn how to tell compelling stories with data? Discover techniques to improve your data visualization storytelling skills right here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/data-visualization-storytelling-2.jpg)](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) ## Data Finance Transformation must address the state of the critical data. This includes data quality, data structure, and data accessibility. I have yet to see an organization that does not complain about the quality of its data and yet they rarely seem to understand who is responsible for the problem or how to fix it. Upskilling the team should include improving their data literacy. Processes that create bad data can be improved with Lean Finance. The usefulness of clean data is still dependent on its accessibility and structure. Finance executives need enough data competency to have a vision for how it should be structured, transformed, stored, secured, and made available. ### 7\. Improve data structure One major aim of a Finance Transformation should be to enhance the team’s ability to provide insightful analysis of the business. Good BI tools and dashboards can allow people throughout the organization to self-serve their inquiries while enabling the FP&A team to explore trends and variances at a deeper level (getting beyond **what* and **where* and into **why*). However, none of that will be optimized without a well-structured financial data model comprised of dimension tables for key dimensions like Customer, Product, Segment, and Employee and fact tables with transactions that can be aggregated using the dimension tables. Somebody with a clear vision of how transaction data can turn into valuable information must architect the financial data model. ### 8\. Data stewardship The concept of data stewardship is that data is a valuable asset that belongs to the enterprise. A data steward is a person responsible for a particular sub-group of data. Typically, they own a process that creates this data. A staff member is more likely to focus on maintaining data quality if they understand that one of their roles is to create and safeguard accurate data, that others in the organization depend on them to do this well, and that inaccurate data impairs the value of the whole database. ## Information The Finance team starts having an impact on the organization’s success and driving strategic changes when data is used to provide meaningful information and insights to the business. These are the principles that relate to the Finance Transformation objective of providing a more insightful analysis. [How to create a simple financial forecast modelFinancial forecasting predicts the future performance of the business. But how can you build a financial forecast model from the ground up? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/financial-forecast-model.jpg)](https://www.financealliance.io/podcast/financial-forecast-model/) ### 9\. Driver-based forecasts I have come to believe that the single most important financial report for any enterprise is a good driver-based rolling forecast with a 5-year (or so) horizon. Accordingly, no Finance Transformation can achieve its full value without developing the people, processes, technology, and data that can enable one. A good driver-based forecast model (DBF model) changes the conversation executives have about results from a backward-looking variance-oriented discussion to one that is forward-looking and action-oriented. It provides clarity about what initiatives need to be undertaken to act on the drivers that will deliver desired results and can serve as the basis for the enterprise risk management (ERM) plan. I have discussed DBF models in an earlier post and I expect I’ll expand on them in later posts. ### 10\. BI/Data visualization One area where the rest of the organization will really feel a positive impact from your Finance Transformation is from Business Intelligence (BI) dashboards that enable them to really explore good data sets. To do this, team members need to become skilled at building good dashboards that refresh with the latest data. Further, data needs to be transformed into effective datasets that are continuously updated. In my opinion, the best tool for the money is Microsoft’s Power BI, but I’ve used other excellent tools like Tableau, Domo and Qlik. You can teach yourself to use Power BI for free with excellent articles and YouTube videos like Guy in a Cube. Good dashboards enable comprehension of information and allow important connections and insights to be made. --- **Want to read more articles about finance transformation? You can visit our [finance transformation library of articles right here](https://www.financealliance.io/tag/finance-transformation/) and continue learning.** ### Why leading CFOs prioritize employees’ mental health at work URL: https://www.financealliance.io/why-leading-cfos-prioritize-employees-mental-health-at-work/ Last updated: 2025-04-07T16:44:33.000Z The topic of mental health at work is something that has been largely stigmatized in the work environment for years. Yet, discussing mental health at work is important to ensure your staff's duty of care and the productivity of your team. As the CFO, your role is about more than ensuring the financial health of the organization is in top shape. You’ve also got a responsibility to your team to make sure that their mental well-being needs are met. Good mental health should be one of your top priorities as not only a CFO but a human being. After all, looking after your mental health is key to a more fulfilling, happier, and productive life – both in and outside of the workplace. To be a truly great CFO and leader, you need empathy and an understanding of mental health. In this article, I talk about the importance of addressing mental health and how you can better support your employees’ mental health at work, as well as your own. **Key topics covered in this article:** - [A brief overview of my own mental health journey](https://www.financealliance.io/p/b82d2f94-3fac-46c2-a752-8051e1a3d5a6/#a-journey-towards-embracing-good-mental-health) - [What it means to be in a 'good place'](https://www.financealliance.io/p/b82d2f94-3fac-46c2-a752-8051e1a3d5a6/#what-does-it-mean-to-be-in-a-%E2%80%98good-place%E2%80%99) - [Some of the most common mental health problems ](https://www.financealliance.io/p/b82d2f94-3fac-46c2-a752-8051e1a3d5a6/#the-most-common-mental-health-problems) - [Why mental well-being is important at work](https://www.financealliance.io/p/b82d2f94-3fac-46c2-a752-8051e1a3d5a6/#why-is-mental-well-being-important-at-work) - [Examples of work and personal life circumstances that can trigger poor mental health](https://www.financealliance.io/p/b82d2f94-3fac-46c2-a752-8051e1a3d5a6/#what-circumstances-can-trigger-poor-mental-health) - [Tell-tale signs of a change in mental health](https://www.financealliance.io/p/b82d2f94-3fac-46c2-a752-8051e1a3d5a6/#tell-tale-signs-of-a-change-in-mental-health) - [Tips to improve your mental health](https://www.financealliance.io/p/b82d2f94-3fac-46c2-a752-8051e1a3d5a6/#tips-to-improve-your-mental-health) - [How to take care of your team’s mental health](https://www.financealliance.io/p/b82d2f94-3fac-46c2-a752-8051e1a3d5a6/#how-to-take-care-of-your-team%E2%80%99s-mental-health) - [How to practice psychological safety in the workplace](https://www.financealliance.io/p/b82d2f94-3fac-46c2-a752-8051e1a3d5a6/#practice-psychological-safety-in-the-workplace) ## A journey towards embracing good mental health I believe that everyone has their own mental health journey, whether they realize it or not. For me, my journey toward good mental health was about understanding the world around me, and the people in it. I had to learn to open my eyes and ears to truly listen to those around me so I could fully understand what they were going through. When I was younger, my grandma had severe depression. I was too young, or perhaps too ignorant, to really understand what she was going through. I couldn’t see it at the time for what it really was. At that time of my life, I had just been promoted to my previous position, so it really should’ve been a happy time of celebration for me. However, I was also going through a breakup and somewhere along the way, I could feel that the light at the end of the tunnel was fading. I was overworking and couldn't stop thinking about work. And I realized that even though it’s nicer to sit in a Mercedes and cry, you’re still *crying*. I knew something needed to change and I knew I needed help to do it. So, I talked to my boss about it, which was uncomfortable because I was recently promoted and instead of showing how capable I was by society’s standards, I showed that I was struggling. I did it anyway and it turned out to be one of the best decisions I’ve ever made. I was treated with respect and received support from not just my boss, but my colleagues too. Talking about mental health at work isn’t easy because there’s a stigma to it, but it’s up to us as leaders to make others feel safe to share their struggles and be supportive of them. Whilst it was a one-time experience for me it has taught me a lot about how I can support colleagues if they are struggling. [How to use data visualization storytelling to transform FP&AWant to learn how to tell compelling stories with data? Discover techniques to improve your data visualization storytelling skills right here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/data-visualization-storytelling-2.jpg)](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) ## What does it mean to be in a ‘good place’? As the CFO, you have a lot on your plate and at times, it can be very overwhelming, which is why I want you to take time to reflect on your own mental health and what you can do to help support the mental health of your colleagues and staff. You’ll often hear people talk about being in a good place mentally, but what does that really mean? How do you know if you’re in a good place or not? I think being in a ‘good place’ looks different to everyone. Just as our journey towards good mental health is unique to us, the destination is also unique, which means there isn’t one single definition of being in a ‘good place’ that is relevant to everyone. However, there are a few common signs that could indicate you’re in a good mental state. When you’re in a good place, you can: \- Handle stress \- Be empathetic \- Work productively \- Realize your own abilities Although it’s a complex and broad term, a strong sign that you have good mental health is that you can see the light at the end of the tunnel. If you find yourself in a rough patch, you can see a way out. You find the solution and you can get out of that dark place fairly quickly. On the other hand, if you’re struggling with your mental health, you might find it difficult to see any form of light at the end of the tunnel. When you’re really down, it can also affect your ability to recognize suffering in others and you may struggle to work productively. However, it’s important to remember that having good mental health doesn’t always mean you’re happy. There'll be times in your life when you feel sad, but the difference is that you’ll know how to deal with the sadness, and you won’t let it consume you entirely. ## The most common mental health problems In the UK, one in four people will suffer from a mental health problem at some point in their lives. If you think about how many people are in your finance team or the entire company and then work out the math, you may be surprised to learn that a large number of people you work with could be struggling with mental health. Some of the most common mental health-related issues include generalized anxiety disorder and depression. The most common treatment options for these issues include: \- Psychological therapy \- Medicine \- Lifestyle changes Although treatment can help, it’s not always effective at solving the underlying issue. Therapy is extremely useful, but it can be difficult to book an appointment with a professional, particularly through the NHS. Some medicines do help, but finding the right option can be difficult. Lifestyle changes are good and beneficial but if you have depression, it might be really difficult to motivate yourself to make those changes as there is a disconnect between rational thinking and emotional thinking. ## Why is mental well-being important at work? Supporting the mental health of your employees is so important because people are at the heart of every organization. Whether you’re a start-up or a huge enterprise, your people and their mental health should be at the top of your priorities. The impact of mental health issues at the workplace: ![Impact of mental health at work](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/Mental-health-awareness-.png) So, what does this mean for the business and you as the CFO? Well, each of the three categories affected by poor mental health have a financial impact on companies, namely economic costs. According to [Enterprise Research](https://www.enterpriseresearch.ac.uk/wp-content/uploads/2020/05/Employee-Wellbeing-Mental-Health-and-Productivity-in-Midlands-Firms-May-2020.pdf), here are the economic cost impacts of each category (in the UK as a whole, not individual businesses): - Absenteeism - £6.8bn - Staff turnover - £8.6bn - Reduced productivity - £26.6 - £29.3bn [Unleash the power of data & analytics with AIAs automation technology matures and becomes an integral part of business operations, it’s time for organizations to pivot from process automation to intelligent automation, and from data-driven organizations to AI-powered organizations.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTjendra Halima![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/tjendra-helima-article-image.jpg)](https://www.financealliance.io/from-data-driven-to-ai-powered/) ## What circumstances can trigger poor mental health? Learning how to spot mental health issues at work can be extremely beneficial for leadership because when you know the signs, you can take a proactive approach towards making sure that person is supported. There are countless circumstances that can trigger ill mental health, and some may be more obvious than others. However, here are a few circumstances to be aware of so that if any of your employees experience one of them, you can make an extra effort to help and support them through it. ### Personal life changes ![how to spot mental health issues at work - personal life changes](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/mental-health-at-work---personal-life-changes.png) **Bereavement** – losing a family member, friend, or pet can be devastating. Making sure your employee gets the support they need is so important, as well as being understanding and empathetic. **A relationship breakdown** – not all employees will be the first to tell you that they’ve just separated from their partner, so this can be a tricky one to spot. **Having children** – although having children is a beautiful thing, it’s a huge adjustment for mothers and fathers alike. Many parents experience ill mental health after having a newborn. **Health issues and health scares** – many people are reluctant to talk openly to their employers about health scares. But dealing with a serious health issue or something that will have a massive impact on their life is something that can really affect someone’s mental health. ### Changes at work ![how to spot mental health changes at work](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/mental-health-at-work---changes-at-work.png) **Starting a new job** – somebody new to the company might struggle, especially if they’re a remote worker as it can be easy to feel excluded. Try to make sure they feel involved and spend time to make them feel like part of the team. **Coping with an increased workload or a promotion** – getting a promotion is very exciting, but it can also be incredibly daunting and it can come with a mountain of pressure to prove that you made the right decision by promoting them. **Poor relationships with colleagues or managers** – if two team members don’t get along, or one is bullying the other, etc., it can quickly spiral out of control and lead to poor mental health. Try to be observant and spot potential warning signs that two people aren’t getting along and see if you can do something about it. **Redundancy or fear of redundancy** – being worried about losing your job is not a pleasant experience. It’s a stressful situation to be in, so you need to be as supportive as possible if your company is facing some redundancy issues. ## Tell-tale signs of a change in mental health How can you tell if someone has a potential issue with their mental health? It can be difficult to spot the signs, but it’s helpful to at least be aware of a few common signs that a person may be struggling, some of which include: | **Work** | **Physical health** | **Mood** | | --------------------------------- | --------------------------------- | ------------------------------------------------------------------- | | Increased errors | Frequent headaches/stomach upsets | Aggression or tearfulness | | Taking on too much work | Difficulty sleeping | Indecision, inability to concentrate | | Working long hours | Lack of care over appearance | Conflict with colleagues | | Struggling with fairly easy tasks | Sudden weight loss or gain | Increased consumption of caffeine, alcohol, cigarettes or sedatives | ## Tips to improve your mental health Helping others starts with helping yourself. If you take care of yourself, then you’ll be in a much stronger position to help and support your team. So, here are a few tips to help improve your mental health and well-being: - **Be active** – the power of movement - **Take notice** – the power of mindfulness - **Learn** – the power of knowledge - **Give** – the power of charitable actions - **Connect** – the power of community ## How to take care of your team’s mental health As the CFO, you have a lot more power and influence than you might realize. You can shape the company and take active steps to make sure your finance team feels safe to talk about mental health and ask for help if they need it. Here are a few suggestions to help support your employees: - Make sure the working environment is safe and free of discrimination (legal obligation) - Employee assistance hotline - Mental health first aiders - Offer training for managers and employees around well being - Staff survey – measure over time Investing in your employee’s mental well-being is a worthy investment for any business. A study recently showed that every dollar you put into mental well-being pays back three times as much. So, investing in mental health is also beneficial from a financial point of view. If you’re the CFO of a company or a Director of Finance or someone in a leadership role, it’s important to think about how you can support your team. Here are some of the best ways to take care of your employees as a leader: ### 1\. Be a role model One of the best things you can do is to be a role model for what good mental health looks like. Take care of yourself and don’t overwork because if you do, your team will feel obliged to overwork as well and that can have an impact on their mental health. They may want to go home and spend time with their family, but when they see that the CFO is working after hours, they’ll feel like they need to meet those same standards. ### 2\. Be vulnerable You should also try to be more vulnerable to foster a culture that embraces talking about issues. If you always have a solid wall around you, people will struggle to open up to you because you’ve never opened up to them either. If you want your team to trust you enough to feel safe opening up about their mental health struggles, you need to make a conscious effort to be someone they feel safe talking about such personal matters. ### 3\. Reconstruct your 1:1s Your 1:1s with your team shouldn’t solely focus on work content. Yes, it’s important to meet deadlines, achieve KPIs, and so on, but those 1:1s offer a great opportunity to get to know your team and build a good relationship with them. My advice to any CFO who wants to develop a trusting relationship with their team is to reconstruct your 1:1s to contain less work content and make employees feel like they're safe to talk about other issues. ### 4\. Be transparent As a leader, it’s up to you to make sure everyone feels included. So, you need to be transparent where possible. If you have been leading a team for a while, you’ll know that the smallest thing can make people feel excluded. For example, maybe you forget to copy someone into an email, which feels marginal to you, but they may feel left out when they hear their co-workers discussing the contents of the email. So, make sure that you share more rather than too little. [3 vital things to know about financial performance analysisEven if you’re experienced at it, there are a few important things about measuring a company’s financial performance that even the experts can overlook. In this blog post, we’re digging into three things every CFO should know about financial performance analysis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/finanical-performance-analysis-header-image.jpg)](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/) ## Practice psychological safety in the workplace A lot of people feel like they’re under constant surveillance at work and if they make a single mistake, they could get in a lot of trouble or even risk losing their job. So, you’ve got to make sure that your team feels safe in their roles and you can do this by practicing psychological safety, which is based on research carried out by Amy Edmondson ’99. The premise of practicing psychological safety is based on three things: 1\. Being able to bring up difficult topics 2\. Owning up to your mistakes 3\. Not fearing negative consequences Give your staff the room to fail without fear. You don’t want everyone on your team to make huge mistakes all the time. But, when a mistake *does* happen, try to be more understanding about it. Doing so will make your team feel more confident to own up to their mistakes and bring up difficult topics without fear of ridicule. Psychological safety is about giving people reassurance and confidence to do their jobs without fear. But it’s not a free pass to be disrespectful. Practicing these things will enhance teamwork because people will begin to talk to each other in a different way that’s more open and freer. It’ll also lead to higher performance and productivity because you can make better-informed decisions, which is crucial for finance teams. --- ### Mental health resources: Looking for additional help and support? Here are a few mental health resources that may help you: - [Mental Health Matters](https://www.mhm.org.uk/pages/faqs/category/helpful-resources) *(features links to resources, downloadable leaflets, and websites about different mental illnesses and mental health conditions, etc).* - [NHS](https://www.nhs.uk/mental-health/) *(find information and support for your mental health - UK).* - [Mental Health First Aid](https://www.mentalhealthfirstaid.org/mental-health-resources/) *(includes some helpful resources - USA).* --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### How to streamline investor reporting processes: A comprehensive guide URL: https://www.financealliance.io/how-to-streamline-investor-reporting-processes-a-comprehensive-guide/ Last updated: 2022-10-06T12:16:58.000Z In today’s current business landscape, startups have to contend with the additional challenges of an uncertain global economy. High inflation rates worldwide; new interest rate cycles from the Federal Reserve, Central European Bank, and Bank of England; continued global supply chain problems; and the looming risk of recession, all contribute to a vulnerable environment that makes it difficult for startups to scale. For this reason, excellent **investor reporting** is critical, as it is the vessel that drives strong investor relations. For many startups, investor reporting can seem like a distraction - an undesirable obligation. However, the reality is that *reporting to investors* can be one of the most critical cornerstone processes for a startup’s success. With the market's current conditions in mind, it's now more critical than ever for startups to take advantage of the insider guidance experienced investors provide. Crafting quality and consistent investor reports is easier said than done. It is a key skill that is crucial for scaling startups to master if they want to optimize their investor communication strategies, which in turn can set the foundation for success. **This article will cover:** - [Five reasons why investor reporting is crucial for all startups](https://www.financealliance.io/p/595400fc-7d3e-419d-82f3-af210b37cc80/#five-reasons-why-investor-reporting-is-crucial-for-all-startups) - [Five investor reporting best practices](https://www.financealliance.io/p/595400fc-7d3e-419d-82f3-af210b37cc80/#five-investor-reporting-best-practices) - [What are the different components involved in an investor report?](https://www.financealliance.io/p/595400fc-7d3e-419d-82f3-af210b37cc80/#what-are-the-different-components-involved-in-an-investor-report) - [How to improve the quality of your investor reports](https://www.financealliance.io/p/595400fc-7d3e-419d-82f3-af210b37cc80/#how-to-improve-the-quality-of-your-investor-reports) - [Why data automation is the future of investor reporting](https://www.financealliance.io/p/595400fc-7d3e-419d-82f3-af210b37cc80/#why-data-automation-is-the-future-of-investor-reporting) ## Five reasons why investor reporting is crucial for all startups Investor reporting serves several purposes. Whether highlighting the latest quarterly results or showcasing a new press release to shareholders, periodic reports help investors get an inside look into a company's overall health. Below, we will be diving into some of the top benefits of investor reports for startups. 1. **Maintain healthy investor relationships** An investor report acts as a periodic update - a kind of “check-in” or record of the company’s progress. Done correctly and transparently, reporting can help a company develop open, strong investor relations that inspire confidence and trust among shareholders. **2\. Avoid shocking or negative news** The nature of startups, especially those in their first three years of operations, tends to include a considerable degree of risk attached to their return on investment. For this reason, it is common for there to be unexpected roadblocks or dips in revenue. Frequent reporting to investors allows startups to keep their VCs up to date on all the latest developments in their company. This can help avoid any investor dissatisfaction, especially if these events lead to poor key performance indicators, delays in product development, recruitment bottlenecks, and so forth. **3\. Receive feedback and advice** Investors are meant to provide guidance. Many of them have been in your shoes and have been startup founders at some point in their careers. Whether they have founded a company or have invested in multiple startups, they often have the expertise needed to scale an early-stage company. Investors can be a source of invaluable advice for startup founders. Keeping them updated on company performance through regular reports gives investors the key insights they need to be able to support business strategy and growth effectively. **4\. Safeguard future funding opportunities** A startup’s series B or C funding often comes from the same investors that provided their series A funding round. By maintaining strong relationships with detailed, transparent reporting regularly, a company puts itself in a stronger position to raise capital during future funding rounds. **5\. It’s required** Venture capital firms typically require regular business reports from their investors. This means investors must provide data, status updates, and insights into how their investments are going. [The importance of improving collections and how to do itImproving accounts receivable is important, but first, you need to understand and address the reasons why customers pay invoices late.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceChris King![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/coins-g0483d70c4_1920-2.jpg)](https://www.financealliance.io/the-importance-of-improving-collections-and-how-to-do-it/) ## Five investor reporting best practices To make each investor report as strong as possible, startups must follow these strategic guidelines. ### Establish the right investor relations culture As mentioned, the obligation to report to investors can sometimes feel like an inconvenient task among a list of other startup demands. When left to the last minute, it can become tedious and lack perspective or critical insight. Instead, prioritize investor reporting as a way to support the overall growth of the organization. Once you shift your mindset and look at these reports as a fundamental aspect to scale, you will then become laser-focused on the overall process and, in turn, create stronger and more strategic reports. ### Prepare in advance Reporting should be periodic, like clockwork. Whether it's once a month or once a quarter, make sure to create a timeline and schedule reports. To ensure consistency in each and every report, there should be an assigned project manager, and each stakeholder, such as CFO, CTO, and CMO, should be given ample time to compile and deliver the requested data. Moreover, the right technologies and processes should be identified and put in place to ensure optimal outcomes. ### Identify the ideal reporting method The best thing a startup can do is to find an efficient way to create investor reports. While many finance teams depend on investor reporting software, there are also more strategic solutions on the market that assist with other FP&A processes. Today, many modern finance teams are shifting towards FP&A software to conduct essential business tasks and plan for the future. Not only does this help to streamline their data and financial information into a single solution, but it also allows them to speed up the entire process of financial planning, reporting, and forecasting, from start to finish. ### Maintain a rigorous commitment to transparency Honesty is the best policy. If an investor doesn’t have a full understanding of a company’s position, the organization can’t benefit from its advice. It may be tempting to disguise or keep disappointing results from view, but doing so will likely damage the company more in the long run. Moreover, venture capitalists are smart, seasoned professionals. Chances are they can spot when something is amiss, which is a surefire way to torpedo trust and confidence. ### Ensure your financial information is accurate and comprehensive The quality and integrity of data, departmental performance, and forecasts should all be meticulously checked. This even goes for more minor details, such as spelling, fact-checking, and so forth. To prevent human-prone errors, consider using a strategic finance platform that can help automate the entire data collection process. [How to use data visualization storytelling to transform FP&AWant to learn how to tell compelling stories with data? Discover techniques to improve your data visualization storytelling skills right here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/data-visualization-storytelling-2.jpg)](https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/) ## What are the different components involved in an investor report? A high-quality report typically includes the following elements: **a.** An executive summary of current company performance. **b.** Metrics including takeaway KPIs, key data, and predictive analytics. **c.** A high-level overview of the performance for the period you are assessing. **d.** Product updates, including launches, upgrades, or changes to the product. **e.** Company updates, including market changes, notable investments, events, new recruits, compliance developments, etc. ‍**f.** Conduct forecasts and scenario planning analysis. **g.** A brief summary that contains key takeaways from the report. ## How to improve the quality of your investor reports Startups can implement a series of measures to improve the quality of their reporting. Below are a few of our top recommendations on how to create top-notch investor reports. ### Consolidate data into a centralized solution This avoids the prevalence of data silos and inefficient, inconsistent processes to do with data gathering, retrieval, and analysis. A single platform that houses all data needs also provides centralized control in addition to greater efficiency, data integrity, and transparency. ### Modernize your tech stack There are a whole host of new FP&A features and strategic finance trends that are emerging in the industry today. If you want to make sure your finance function stays ahead of the game, make sure you invest in a modernized tech stack. Today’s technology landscape is vast and ever-growing, making it increasingly difficult to know which platforms are right for your finance team. That’s why it is essential to do your research, outline your desired features, and study the different options available. ### Ensure all budget owners are accountable for their data Each budget owner should have ownership over their data and be assigned key responsibilities. This ensures that the quality of monthly, quarterly, or annual reports is held to a higher standard and has the right oversight before it's shared with investors. ### Adopt a “BizOps” mindset BizOps - taken from business operations - is the belief that maximized success is only possible through strong collaboration and connection between the finance team and operations. By aligning different teams of an organization, all functions will be able to align on KPIs and business objectives when creating their path forward. [Top 10 FP&A skills every finance professional must masterHere are the top 10 FP&A skills you must master if you want to thrive within your role as a finance professional.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/10/FP-A-Skills-2.jpg)](https://www.financealliance.io/top-10-fp-a-skills-to-master/) ## Why data automation is the future of investor reporting Data is everywhere. The best thing an organization can do is to learn how to harness and use it to its advantage to grow. When a company is unable to manage its data to derive valuable insights, it won’t be able to learn from the past and create a clear roadmap for the future. However, with the right strategic finance platform in place, startups can streamline their financial processes and better support strategic decision-making among senior management. If your finance function wants to build robust investor relations, improve transparency, and build trust among your investors, consider incorporating an FP&A solution into your current processes. --- ### How data visualization storytelling transforms FP&A URL: https://www.financealliance.io/how-data-visualization-storytelling-transforms-fp-a/ Last updated: 2025-04-04T10:40:29.000Z FP&A professionals are masters at analytical thinking and numerical analysis, but they also need to learn how to tell an amazing story with data. Believe it or not, not everyone in your board meetings can read and analyze data like a pro. Most people outside of the finance function look at data graphs and spreadsheets like they’re something out of *The Matrix* movies. They know the data is important and that it means something that could potentially impact the business, but they’re not sure *what*. This is where you step in. As an FP&A expert, you understand how the data comes together, what it means, and how that data can be used to make better-informed decisions that lead to real-world success. The only thing left to do is figure out how to convert data into compelling stories to share with the CEO and other stakeholders. In this article, you’ll learn why data visualization storytelling is so important and how to tell amazing stories with data. Topics covered in this article: - [What is data visualization storytelling?](https://www.financealliance.io/p/28e693ee-9468-4f76-94ad-e3b07c0b6371/#what-is-data-visualization-storytelling) - [Why do FP&A teams need to be great storytellers?](https://www.financealliance.io/p/28e693ee-9468-4f76-94ad-e3b07c0b6371/#why-do-fpa-teams-need-to-be-great-storytellers) - [Three tips to tell better data-driven stories](https://www.financealliance.io/p/28e693ee-9468-4f76-94ad-e3b07c0b6371/#how-fpa-teams-can-tell-better-stories-with-data-visualization-best-practices) - [Data visualization storytelling techniques](https://www.financealliance.io/p/28e693ee-9468-4f76-94ad-e3b07c0b6371/#data-visualization-storytelling-techniques) ## **What is data visualization storytelling?** Data visualization storytelling translates data into stories to help others understand exactly what the data means. Don’t worry, nobody’s asking you to write the next big fantasy epic. You’re essentially translating data into a visual context, which makes it easier for others to make sense of it. Some examples of translating information into visuals include: - Graphs - Colorful tables - Images - Maps Rather than looking at data on a screen and trying to figure out what it means, visual aids make it easier to identify patterns or trends in the data. Data visualization storytelling requires some degree of creativity on your part. Creating a narrative and weaving a story together with data is a useful skill for any finance professional to have. One of the best ways to tell a story with data is by anchoring your narrative in facts. Think of how you can communicate the true meaning of the data in a way that’ll keep your audience engaged. Focus on emphasizing *why* the data is relevant. You also need to try and communicate your story with clarity. The last thing you want is for your audience to feel like they have to study large datasets for hours to grasp your message. [3 vital things to know about financial performance analysisEven if you’re experienced at it, there are a few important things about measuring a company’s financial performance that even the experts can overlook. In this blog post, we’re digging into three things every CFO should know about financial performance analysis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/finanical-performance-analysis-header-image.jpg)](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/) ## **Why do FP&A teams need to be great storytellers?** [80% of CFOs](https://www.accenture.com/%5Facnmedia/PDF-85/Accenture-CFO-Research-Global.pdf) agree that data storytelling is an essential skill for today’s finance professionals, and it’s not that surprising if you think about it. Humans are visual creatures. We’re naturally drawn to visually appealing things, hence our undying love for the cinema and pictures of cute animals. We also love a nice graph. We’d rather look at a colorful representation of data because it makes it easier to identify patterns and comprehend the meaning of complex data. Data visualization storytelling is a form of visual art. It grabs our attention and keeps it there long enough for us to grasp the message *behind* the data. There are lots of reasons why FP&A teams should embrace data visualization and work on their storytelling skills. But, in case you need some more convincing, here are a few of the best benefits of telling stories with large amounts of data: ### Data visualization storytelling makes it easier to grasp the meaning of large datasets As we’ve mentioned, data visualization presents information in a way that’s easy to digest. You can look at a huge spreadsheet of numbers and have no idea what any of it means. Yet, if you’re presented the same information as a story on a chart or graph, for example, you can grasp complex information in a matter of seconds. ### Anchoring your claims in facts boosts your credibility Nothing boosts credibility like stating how it is. By rooting your data stories in facts, you make it extremely difficult for anyone to disagree with your claims. Since you’re only presenting factual information, your overall message comes across as more credible than if you presented ideas or solutions based on assumptions. ### A unified understanding of data leads to better solutions Representing data in a way that’s easy to absorb, makes it a lot easier for everyone to understand the data and make faster, better-informed decisions. Not only that, but if you have convincing data visualization storytelling skills, you’ll be in a much stronger position to recommend what steps the business should take next to improve. [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) ## **How FP&A teams can tell better stories with data visualization best practices** FP&A professionals can’t tell great data-driven stories without considering three key areas of the data visualization storytelling process: ### 1\. Understand the data If you don’t understand the data you’re presenting, how can you expect anyone else to understand it? As an FP&A expert, you need to understand the data and the call to action (CTA) the business must take. Once you have a thorough grasp of the data, the next step is to develop your key message. ### 2\. Know your story and consider your audience You’ve got the data, now you’ve got to pin your story down. The best data visualization stories are always empathetic and relevant to the audience. Once you have your key message, it’s time to build a story around it using data. Let’s say that you have an idea of how the company can cut costs, save more money, and become more profitable in the future. You know your boss and the entire board of C-Suite members are going to love your idea. Unfortunately, a great idea isn’t enough. You also need data to back your story and justify your idea. Consider what data sets are going to communicate your story as effectively as possible for maximum impact. When developing your story, consider... - Your story's purpose - Your target audience - The risks and opportunities you want to cover - The call to action We recommend starting with a hook to draw the audience in. Then, bring them along for the ride and continue to build momentum until you reach a solution (the CTA). ### 3\. Choose the right data visualization storytelling chart The final step in creating your data visualization story is to choose the right visuals to support your story and make it as compelling as possible. Need some help choosing what data-driven narrative to go with for your story? Here are a few of the best ones: **Comparison/Correlations** – Comparing one set of data with another and looking at how they evolve over time is a good narrative strategy to analyze trends more broadly. **Trends** – Numbers rarely stay the same. If you notice numbers increasing and decreasing, look out for trends within the data that could tell an important story that the company needs to pay attention to. Trend graphs are one of the best methods to showcase how specific trends are impacting the business. **League table** – If you need to focus on hierarchy, a rank order table is a useful way to show the ranking order of a range of stats and KPIs. You can organize the data in a chart or table to make the data easily digestible. [7 cash flow management strategies for busy finance teamsHow can you make sure that your cash flow management strategy is a booming success? In this article, we share seven simple but effective cash flow management strategies for busy finance teams...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/cash-flow-management-strategies.jpeg)](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) ## **Data visualization storytelling techniques** FP&A teams are bombarded with data. It’s one thing to have all that data on a spreadsheet, but how can you present it in a more visually appealing way? There are a few commonly used methods to present data such as charts, tables, graphs, infographics, maps, and dashboards. However, there are also some more specific methods of data visualization that you might find useful. Let’s look at some of the best data visualization storytelling methods and techniques for FP&A professionals: **Charts:** - Area chart - Bar chart - Gantt chart - Pie chart - Line chart **Graphs:** - Bullet graph - Wedge stack graph - Streamgraph - Bar graph **Tables:** - Highlight table - Text tables **Maps:** - Dot distribution map - Heat map - Treemap **Other ways to present data:** - Box-and-whisker plots - Bubble cloud - Cartogram - Circle view - Histogram - Matrix - Network - Polar area - Radial tree - Scatter plot (2D or 3D) - Timeline - Word cloud Effective data visualization is a vital skill for FP&A professionals. After all, data is central to most business-related decisions. So, if you can learn to tell compelling stories with data, you’ll see a lot more success when it comes to presenting your ideas with credibility. You'll also have a higher chance of gaining the support you need to see those ideas put into action. --- ## **Enrol in our Business Partnering & Storytelling: Certified course** Drive smarter business decisions by mastering the art of storytelling and business partnering. This [**Business Partnering & Storytelling**](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) course gives you the tools to transition from simply analyzing numbers to using them to inspire change and profit. Gain five hours of engaging, on-demand content, actionable slides, and expert advice from **Christian Wattig** to turn complex data into compelling stories. You’ll learn how to influence decision-makers and build stronger, more productive business relationships. Ready to make an impact? **Enrol today and take your finance career to the next level!** [Enrol today](https://certified.thealliance.io/course/business-partnering-and-storytelling-certified-masters ) ### How to survive a post-merger integration URL: https://www.financealliance.io/podcast/how-to-survive-a-post-merger-integration/ Last updated: 2025-04-05T07:41:46.000Z A post-merger integration (PMI) can be both an exciting and stressful time for any organization. So, what can you do to ensure a successful post-merger integration? In this episode of the Two Cents: Finance Talk podcast, we’re joined by Janice Hopkins, Director of Finance at Convergence Networks. Janice is amid a post-merger integration herself and has a lot of useful tips and advice to help finance functions prepare for a post-merger integration and navigate the common challenges that come along with it. Listen to the full episode below: Or keep reading to learn: - [What is a post-merger integration?](https://www.financealliance.io/p/92474b4b-db09-4c84-8bbc-9ef60e8158a2/#what-is-a-post-merger-integration) - [The reality of being a finance professional in the middle of a post-merger integration.](https://www.financealliance.io/p/92474b4b-db09-4c84-8bbc-9ef60e8158a2/#an-inside-look-at-the-post-merger-integration-process) - [Post-merger integration challenges.](https://www.financealliance.io/p/92474b4b-db09-4c84-8bbc-9ef60e8158a2/#challenges-of-a-post-merger-integration) - [How to get familiar with new laws, accounting standards, and audit requirements.](https://www.financealliance.io/p/92474b4b-db09-4c84-8bbc-9ef60e8158a2/#how-to-get-familiar-with-new-laws-accounting-standards-and-audit-requirements) - [How to ensure your company’s merger is a success.](https://www.financealliance.io/p/92474b4b-db09-4c84-8bbc-9ef60e8158a2/#how-to-ensure-your-company%E2%80%99s-merger-is-a-success) ## **What is a post-merger integration?** Mergers happen when two or more companies combine. More often than not, a merger occurs when one company is purchased by another. Both companies usually benefit from the merger as it leads to increased shareholder value. However, merging more than one company isn’t easy because there’s a lot to consider and no guarantee that both companies will work seamlessly together. There’s a steep learning curve and it takes some trial and error before all the moving parts work like clockwork. A post-merger integration (PMI) is the aftermath of the original merge. Now that both companies have come together to maximize synergies, the merged company (and everyone in it) must learn to work together and ensure the deal lives up to the predicted value of the merger. [How scenario planning can prepare your business for anythingReducing risk and building awareness of what could happen can help you prepare for almost anything. But how does strategic scenario planning work? And how can finance teams use it to future-proof the business? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/firmbee-com-jrh5lAq-mIs-unsplash-2.jpg)](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) ## **An inside look at the post-merger integration process** What better way to make sure your post-merger integration is a success than to learn from someone who has experienced it themselves? Janice Hopkins is the Director of Finance for a Canadian firm in the technology sector. She has been with the company for 10 years. Two years ago, her company merged with another company in the same industry that was based in the US. But the merge didn’t stop there because six months after the initial merge, they merged with another company. Here’s what Janice had to say about what it means to integrate after a merger: ### 1\. People are the most important part of any merger Integrating is many things. Your people are the most important. And for the success of any merger, it's going to involve the people. Being in two countries, you're going to have cultural differences. You may or may not have some resistance to the merger. People may not understand the merger and what it means for them. > "It's about the people because ultimately, that's what's going to make or break a successful merger.” ### 2\. Consider your clients You must think about your clients and the message you're going to tell them during the post-merger integration process. Are they going to be nervous? If you're a smaller entity based in the city and owned by owners in the city, are your clients going to feel like they’re just small clients in a big conglomeration? You want your clients to continue to feel valued. You also need to make sure they understand how this merger can benefit them and the staff. If you've merged with another company, you've got more resources and training at your fingertips. > "Everybody, on some level, could be a little insecure during the post-merger integration phase and that can often touch on people's insecurities. So, you really need to make sure you consider all of that to help ensure your merger is a success.” ### 3\. Streamline processes and systems You have to talk about your systems. Ask questions like... are we all using the same systems? Are we all getting our data the same way? Are our processes the same and do we treat contracts the same? > "For a successful post-merger integration, you want to streamline everything because it just makes sense. You can't do one thing a certain way in one location, and something completely different elsewhere, it just gets too complicated.” ### 4\. Post merger finance integration Since I'm the Director of Finance based in Canada, it has implications. We must consider the currency we’re reporting, how we report it, and the frequency at which we report it. Now that we have external owners, we can have much tighter timelines. The timelines get stricter because they apply to everybody. We also need to think about what systems we should keep, who has the best systems, and how can we pull everyone together. When we have weekly meetings for all staff, we have to pick a time that suits everybody. You can't have people up at 7am in one location, whereas they normally start at 9am. > "You have to pick a convenient time for everybody and have different people report different responsibilities.” [5 ESG investing trends every CFO needs to watch closelyHow prepared are you for the rising dominance of Environmental, Social, and Governance (ESG)? In this post, we’re looking at some interesting ESG market trends to pay close attention to...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/ESG-investing-trends-2022.jpg)](https://www.financealliance.io/5-esg-investing-trends/) ## **Challenges of a post-merger integration** Many challenges come with merging two or more companies. A few examples of possible challenges include having an unclear integration strategy, disengaged leadership, weak synergy program management, etc. Janice shared some interesting insights about the challenges her finance team faced during the post-merger integration process. ### Currency differences (the US and Canada) I'm based in Canada, so I had to change the currency I was reporting in. With the Canadian and US integration, we both refer to our currency as dollars, but these are two different currencies. So, we must get everyone straight on that and specify which dollars we’re reporting in. ### Dealing with extensive audits Another possible challenge, if you're merging from a smaller firm, is that you might not have been required to have an audit before. And because of the merger, all the offices are now part of the audit. So, we're working with a new accounting audit team, and an audit is a much bigger deal when you’ve merged because everything is scrutinized more. You have to have all your paperwork in place and we’re subject to more auditing standards. We had to make some changes to how we record revenue and inventory, etc. because it's much stricter than if we were a non-audit company. ### Working with new people/firms We had to get an auditing firm that is international because they must have an office in Canada because we still have some Canadian tax laws that need to be applied. But they also needed to have a strong presence in the United States for the same reason. ### Operating in two different countries (the USA and Canada) Merging companies in different countries is inherently more difficult because you’ve got a lot more to consider. One of the biggest issues that companies face when merging across borders is various cultural issues. You’re also likely to face some resistance from within both companies, either by the staff or clients. [Deloitte](https://www2.deloitte.com/content/dam/insights/us/articles/post-merger-integration-hard-data-hard-truths/US%5Fdeloittereview%5FPost%5FMerger%5FIntegration%5FJan10.pdf) reports that 64 percent of managers interviewed believe that resistance tends to be low at the top management level and high at the worker level. However, other findings show that post-merger integration projects face resistance at all levels, from regular workers to middle and top management. Still, one of the biggest issues facing merging companies operating in different countries is the currency differences. Janice spoke about this in more detail: > “Getting the wrong currency can have implications. For example, if I get a journal entry and I assume it's in Canadian currency, that could mess up the Canadian books. So, I need to ensure that I ask what currency they're using every time in their reports and so on.” Another important factor to consider when merging with a company in a different country is their Generally accepted accounting principles (GAAP). Canadian GAAP and US GAAP are slightly different, which Janice talked about in the podcast: > “I don't know US GAAP. So, I have to defer to the auditors and to our CFO who's based in the United States to tell me about what US GAAP is. And as a result, US GAAP takes precedence because we do report to our US private equity firms and our auditors are US-based." ## **How to get familiar with new laws, accounting standards, and audit requirements** The number one thing to do when you’re trying to learn about another country’s accounting standards and audit requirements, etc. is to get a good auditor. Janice recommends seeking an auditor that specializes in or is familiar with mergers. In the early stages of a merger, accounting can be quite complicated. So, choose a good auditor who knows what they’re doing and perhaps has some experience in the industry as well. > “Your audit team is really important because they’re going to have many questions about your processes, how you do things, how you record things, etc. And if they understand your industry, then they can jump to what they need to ask more quickly. > “You have to be open-minded about new processes and new ways of doing things. They might say you can't do that anymore, you can't record inventory, your revenue, or expenses like that. > "And even though you may have been doing it the same way for 10 years, now you have to change it… you have to accept that that's the way it is. And it's probably for good reason because it can make everything more accurate as a result.” [Robotic Process Automation in Finance: 5 benefits of RPAIn this post, you’ll find out how to use RPA to streamline financial processes. We’re also sharing five amazing benefits of using automated RPA software.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/robotic-process-automation-in-finance-2.jpg)](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) ## **How to ensure your company’s merger is a success** Here are Janice’s top tips to help ensure your finance team survives a post-merger integration: ### Ensure a clean cut-off point When you first go into a merger, you’ll reach a cut-off point, which is when the old company ends, and the newly merged company begins. It’s best to make sure your cut-off is nice and clean and that your revenue has a nice clean break, etc. ### Be open-minded Try to make your processes as simple as possible and be open-minded to other offices. What are their finance processes like? They may have a much better process. They may record revenue in a way that you hadn't thought about. They might have a more efficient way to invoice clients or deal with collections, accounts receivable, cash flow, etc. ### Document processes Having processes documented is helpful. And it helps everybody organize their minds and ensures everyone is on the same page in terms of reporting deadlines, etc. If you have a new CFO post-merger integration, they might be based elsewhere, and that person needs to understand how each entity does things. > "If a company is going through a merger, chances are, more mergers are coming." So, you need to build processes to help things run as smoothly as possible. You don't want to reinvent the wheel every time you merge with another company but at the same time, you've got to be respectful of the fact that the latest company to jump in might have a better process than any of the existing companies. ### Use the same software across all entities In terms of software, if you can get on the same platforms, it's inevitable that you'll find efficiencies. If we're all on the same platform, it allows the CFO to jump in to say how well Canada is doing in that aspect, they don’t have to go to a whole bunch of different platforms. They can access everything in one place. ### Communicate with other departments In finance, we need to think about what the rest of the departments need to ensure success. What kind of metrics do they need and what are their deadlines? What can we do as a finance department to help other departments? Because as finance professionals, we're the holder of the data and the timeliness. > "Communication is important because we're all in it together and other departments need to know that we're willing to talk and help them get the information they need within the required time frame.” ![Two Cents: Finance Talk podcast ep.5 with Janice Hopkins - how to survive a post-merger integration](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Ep.5-Janice-Hopkins---how-to-survive-a-post-merger-finance-integration--1--2.png) ## **About the guest** Based in Canada, Janice Hopkins has worked as the Director of Finance at an owner-managed IT Managed Services firm, Convergence, for 10 years. The firm recently merged with several US-based IT Managed Services firms, with the head office based in Portland, Oregon. Janice started her career in public accounting at Ernst & Young and has worked in many industries including construction, health services, and education. **Want to listen to more episodes of the Two Cents: Finance Talk podcast? You can tune into more episodes of the show** [**right here**](https://www.financealliance.io/podcast-two-cents-finance-talk/)**.** ### The importance of improving collections and how to do it URL: https://www.financealliance.io/the-importance-of-improving-collections-and-how-to-do-it/ Last updated: 2022-09-23T14:42:56.000Z --- **A note about this article:** *Last year I led an implementation of HighRadius Cloud Collections, one of the leading solutions for adding automation to the collections process.* *I pointed out to the team that of all the customers implementing this solution, some would do it much better than others.* *We wanted to ensure we would be in the top quartile of all their customers, so we ran a full transformation initiative that included developing our staff, taking a strategic approach, applying Lean principles, and using good change management techniques.* *It began with the following article to bring clarity and alignment among the team.* --- The AR transformation initiative aims to reduce our outstanding AR and improve the productivity of the team through a combination of process improvements (applying [lean finance principles](https://www.financealliance.io/how-to-make-your-finance-team-lean-5-principles-of-lean-finance/)), global harmonization and teamwork, and the implementation of best-in-class collections software. The collections team has identified their primary job: to minimize overdue accounts receivable and write-offs (bad debt expense) as efficiently as possible. The primary lag measure of efficiency for the team is the total cost of the credit & collections function including bad debt expense as a percent of the amount billed on credit. The primary lag measures of effectiveness are: 1\. Days Sales Outstanding (DSO). 2\. The amount of overdue debt. 3\. Bad debt expense as a percentage of revenue. This AR transformation initiative is intended to deliver improvements to these measures. ## **Why improving accounts receivable is important** If we can reduce our outstanding receivables by $20 million, that’s $20 million less we need to borrow or $20 million *more* we can invest to create more profits. When that $20 million is tied up in overdue receivables, we don’t earn anything on it, and it’s at increased risk of becoming uncollectible (lost capital). ## **Reasons for late payments** It’s important to understand and then address the reasons why customers pay invoices late. ### Free capital Just as we want to collect the receivables so we can reinvest in our businesses that earn a profit, our customers want to invest capital in their businesses. They may not be able to borrow more than they already have, or they may just want to avoid the interest expense of a bank loan. Many savvy Finance chiefs will try to use “vendor capital” by paying everyone late. For example, if a company has $10 million a month in expenses on 30-day terms, it can access an additional $20 million in capital by paying those bills in 90 days instead of 30\. Unfortunately for them, most vendors are capital conscious themselves and won’t allow late payments. But they can quickly find out where they can extend payments by seeing when the collections teams from their vendors start chasing the debt. If we wait until payments are 60 days overdue to start chasing them, then we're the ones who are allowing two months of receivables to be invested in their business instead of ours. #### The cure The cure for this is to contact customers about overdue receivables as close to the first day they are overdue as possible. This trains the customer that we are paying attention and are capital conscious. Customers also want efficient accounts payable. To achieve that, one has to keep one’s accounts payable team off the phone and not be distracted by emails about late payments. One achieves efficient accounts payable by allowing the team to spend most of their time processing invoices and making payments before vendors call to follow up. We need to train our customers to expect that to happen the day after the due date. There are more invoices to chase that are one day old than 60 days old. That’s where the improved efficiency of the new software comes into play. We want our software to tell us who just became overdue today and to facilitate contacting them with copies of invoices or statements. If we get a promise to pay by a certain date, we want the software provider to tell us if they didn’t come through on that promise so we can follow up right away (they may be hoping we forget about it). [Robotic Process Automation in Finance: 5 benefits of RPAIn this post, you’ll find out how to use RPA to streamline financial processes. We’re also sharing five amazing benefits of using automated RPA software.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/robotic-process-automation-in-finance-2.jpg)](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) ### **Invoice errors** Another common reason for late payments is a problem with the invoice that prevented a three-way match in the customer’s accounts payable system. A three-way match is generally required to pay an invoice: the invoice matches the PO and the receiver/packing slip. If we bill the wrong amount, ship the wrong product or quantity, or simply fail to put a required PO number on an invoice, it can cause a delay. Customers will often skip those invoices and wait until we follow up to resolve them. Eventually, we call to ask why they haven’t paid an invoice, they explain that we charged them for two items but only shipped one, we research it, issue a credit memo or rebill, and eventually, they pay. These invoices tie up capital and cost us extra time (money) to resolve. #### The cure There are two things we want to do with this type of invoice. Using some of our Lean Finance principles, we want to get to the root cause of these errors and work with other departments (sales, customer service, warehouse) to make changes to the processes that allow these errors. If we can reduce the number of faulty invoices, we collect them on time and save the cost of resolving them. Second, we want to call about these invoices the day they are skipped. If a customer pays an invoice that is more recent than one they haven’t paid, we want to contact the customer and find out the problem with the skipped invoice. As we set up our accounts receivable automation software, we want to make sure the system will alert us to the skipped invoice. [CFO tips: How to predict and prepare for a financial crisisWhat can you do to prepare for a financial crisis? In this article, you’ll learn about the most common warning signs that there’s a financial crisis looming and how to prepare for one as the CFO of a company.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/how-to-prepare-for-a-financial-crisis.jpg)](https://www.financealliance.io/how-to-prepare-for-a-financial-crisis/) ### **Cash flow problems** The third reason customers pay late is that they simply don’t have the cash to pay on time. Imagine you are running a finance department at a company that has financial difficulty. Every pay period you aren’t sure you’ll have the cash to make payroll and the unpaid bills are piling up. Stressful! You have to pick and choose who to pay and when. If things don’t turn around soon, you may need bankruptcy protection to get the chance to reorganize or you might just go out of business without all your bills paid. #### The cure One of our objectives is to minimize our bad debt expense (the provision for uncollectible receivables). Our credit approval processes are designed to help us avoid extending credit to customers that may not pay it back. An ounce of prevention is worth a pound of cure. However, it’s equally important to realize that whenever a company has cash flow problems, whether they go into bankruptcy or survive, there are relative winners and losers among its vendors. Generally, the squeaky wheels get the oil. When the Head of Finance at a struggling company is deciding who to pay each week, the companies that have proactively contacted them and agreed to a revised payment schedule, or have simply followed up professionally and timely, tend to get paid faster. If we aren’t proactive, they pay somebody else (like our competitor). [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) ## **Negotiated short payments** In addition to late payment issues, we also have losses related to short payments for various reasons. Sometimes, customers see an opportunity to get a reduction in a very old invoice in exchange for paying it! When our documentation is not strong enough to make it clear our invoice is correct, we often make concessions to keep our customers happy. Customers sometimes take deductions claiming a problem with the product or they return damaged goods. #### The cure Short payments can add up. The first thing we want to do is to create an easy way to track and quantify the impact. Then we investigate the short payments and complete a root cause analysis of each. Generally, we should find a short list of root causes. We can then categorize short payments as they happen according to the root cause, and use that data to determine which issues to attack first. We want to include in our transformation the efforts to address all the items that lead to losses or tie up our team’s time. ## **Conclusion** The purpose of this article is to get clarity and alignment on the items above. To keep it brief, I have oversimplified the issues you face and what it'll take to solve them. I don’t have all the answers. But together, we do. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### 5 emerging ESG investing trends you need to watch closely URL: https://www.financealliance.io/5-esg-investing-trends/ Last updated: 2022-09-22T08:18:28.000Z The journey to sustainable finance is laced with emerging ESG trends that you must watch closely if you want to improve financial sustainability. Investors prioritize ESG factors when identifying growth opportunities and material risks. If your company fails to show a noticeable movement towards financial sustainability, it’ll fall under great scrutiny from investors and the public. So, just how prepared are you for the rising dominance of Environmental, Social, and Governance (ESG)? In this post, we’re looking at some interesting ESG market trends to pay close attention to, covering topics such as: - [What is ESG investing?](https://www.financealliance.io/p/b6577d2f-bcec-475d-a24d-6f26f379f866/#what-is-esg-investing) - [Why ESG is so important](https://www.financealliance.io/p/b6577d2f-bcec-475d-a24d-6f26f379f866/#benefits-of-esg-why-is-it-so-important) - [5 ESG investing trends](https://www.financealliance.io/p/b6577d2f-bcec-475d-a24d-6f26f379f866/#5-emerging-trends-in-esg) ## What is ESG investing? ESG stands for Environmental, Social, and Governance. It’s a set of standards designed to assess how much impact a business has on the environment and society. ESG also measures a business’ accountability for its carbon footprint and has become an extremely important factor for investors. The environmental part of ESG concentrates on how the business is working towards minimizing its impact on the environment. Some methods include reducing energy, switching to sustainable packaging, decreasing carbon emissions, improving recycling efforts, and so on. The social part looks at how a company impacts society as a whole, paying close attention to its workplace culture. A few examples of social best practices include promoting equality, providing training, and investing in projects within the local community. Finally, governance explores a company’s processes around decision-making and reporting. It also looks at its transparency with stakeholders. Some governance best practices include things like ensuring diversity and inclusion in leadership teams, ethical business processes, keeping leaders accountable for risk, and accurate reporting to key stakeholders. [CFO and CEO relationship: 5 ways a CFO can support the CEOIn this post, you’ll learn what a CEO needs from their CFO, and what you can do to support the CEO on a day-to-day basis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/handshake-g5cf73343d_1920-1.png)](https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/) ## Benefits of ESG: Why is it so important? Before we look at some of the emerging ESG trends, it’s worth being aware of why ESG is taking off the way it is. After all, there’s a reason why so many businesses want to reduce their carbon footprint. Here are a few key benefits that companies have seen following a successful implementation of ESG within the organization: - Top-line growth - Cost reduction - Competitive advantage - Increased employee productivity - Improved efficiency - Boosted revenue - Increased innovation - Stronger stakeholder relationships - Investment and asset optimization - Decreased regulatory and legal interventions To read about more benefits of ESG, check out our blog post –[ *Are you prepared for ESG and sustainable finance?*](https://www.financealliance.io/are-you-prepared-for-esg-and-sustainable-finance/) [Is your company prepared for ESG and sustainable finance?What is sustainable finance? And how can CFOs help their organization prepare for ESG and sustainable finance? In this blog post, we dive into the true meaning of sustainable finance and ESG.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/What-is-sustainable-finance.jpg)](https://www.financealliance.io/are-you-prepared-for-esg-and-sustainable-finance/) ## **5 emerging trends in ESG** ### 1\. ESG-related roles will emerge and become more prevalent across various industries The CFO will often take the lead when it comes to putting ESG efforts into place. However, with the importance of ESG growing, it looks like many organizations will appoint a specific ESG role. This role will oversee and manage a company’s ESG goals, ESG funds, and sustainability procedures. These roles will likely include Chief Sustainability Officers and Chief ESG Officers. Their main responsibilities will depend on the individual organization but will involve embedding ESG and sustainability within the company successfully. Both roles will likely introduce new procedures to help companies embrace ESG as effectively as possible. The scale of work required could range from a simple readjustment to a complete overhaul. If it's the latter, it's most likely due to a noticeably absent effort towards sustainability. ### 2\. A demand for credible corporate financial disclosures is on the rise An emerging ESG trend that has already taken effect is the introduction of new regulations and reporting standards. In 2021, a lot of large-scale businesses eagerly published their ESG data to showcase their efforts. However, many companies were faced with backlash from investors, regulators, and the general public, who accused them of greenwashing. The problem lies with the concern that companies are using sustainability labels on products or services solely to boost marketing efforts. To resolve the issue, a brand-new standard-setting board was launched called the[ International Sustainability Standards Board](https://www.ifrs.org/groups/international-sustainability-standards-board/) (ISSB). > “*The intention is for the ISSB to deliver a comprehensive global baseline of sustainability-related disclosure standards that provide investors and other capital market participants with information about companies’ sustainability-related risks and opportunities to help them make informed decisions.*” – ISSB Keeping organizations accountable and setting disclosure standards will help ensure a higher level of credibility is met. [7 cash flow management strategies for busy finance teamsHow can you make sure that your cash flow management strategy is a booming success? In this article, we share seven simple but effective cash flow management strategies for busy finance teams...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/cash-flow-management-strategies.jpeg)](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) ### 3\. ESG is now a mainstream investment proposition One of the most pressing ESG investing trends is the fact that sustainable finance is no longer a niche player. ESG has quickly moved into mainstream investment propositions. Without a real ESG strategy in place, your company could find it increasingly difficult to lock down investors. [ESG integration](https://www.financealliance.io/from-digital-strategy-to-esg/) is more important than ever. This means that your business must integrate key ESG insights and data into the investment process and do so regularly. ### 4\. The financial services industry will focus more on climate stress testing Climate change is a possible threat to financial stability. Major financial institutions are waking up to the fact that something has to change sooner rather than later. Yes, the energy sector has a massive role to play. However, financing also has a lot of impact on the environment that hasn't been talked about to the level it should. Until now. Recent ESG trends have shown that more financial service institutions are considering their role in improving the economy’s climate resiliency. Banks and other establishments must assess their impact on the environment with climate stress testing. This includes assessing their potential for climate-related risks and physical risks. Then, taking the necessary steps to manage those ESG risks. Climate stress testing is a useful way for the financial services industry to measure its climate risk. And it stands to be a huge ESG trend moving into 2023 and beyond. ### 5\. Carbon offsetting will become a popular ESG trend and act as a short-term solution to achieve net-zero targets Net-zero targets for carbon emissions are quickly becoming the ultimate goal for many companies. The main reason for this shift in priorities is because their stakeholders are pressurizing them to make huge leaps toward sustainability. The only problem is that achieving net-zero targets is incredibly difficult. To solve the issue short term, many companies are taking part in carbon offsetting schemes designed to reduce CO2 emissions. [The Guardian](https://www.theguardian.com/environment/2011/sep/16/carbon-offset-projects-carbon-emissions) defines carbon offset schemes as: > *“...allowing individuals and companies to invest in environmental projects around the world to balance out their carbon footprints.”* Some examples of carbon offsetting schemes include: **Aviation** – leveraging ‘carbon neutral’ flights and optimizing flights with artificial intelligence (AI) to reduce the production of contrail clouds. **Reforestation** – planting more trees in areas of deforestation. **Wastewater treatment facilities** – supplying clean water to areas with contaminated water. **Energy-efficient technology** – improving the efficiency of infrastructures, for example. **Renewable energy** – prioritizing replacing fossil fuel with renewable energy (e.g. wind farms). **Waste management** – capturing methane at landfills that are generated from waste disposal. **Carbon sequestration** – carbon capture and storage methods to reduce the amount of carbon being released into the atmosphere. If you’d like to talk about any of these ESG market trends in more detail, consider joining our free Slack community. It's the perfect place for finance professionals to connect, network, share job opportunities, ask questions, and share ideas. You can sign-up to our[ Slack Finance Alliance community](https://www.financealliance.io/community/) right here. [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### From data-driven to AI-powered organization: Unleash the power of data & analytics with AI URL: https://www.financealliance.io/from-data-driven-to-ai-powered/ Last updated: 2022-09-20T11:44:13.000Z The fast-paced age of computer connectivity is blurring the lines among physical, digital, and biological spheres. Tech is everything and tech is everywhere. Most organizations have somehow gone through a digital transformation journey. Today, almost every company is a technology company. As automation technology matures and becomes an integral part of business operations, it’s time for organizations to pivot from process automation to intelligent automation, and from data-driven organizations to AI-powered organizations. ![Data & analytics with AI](https://media-exp1.licdn.com/dms/image/C5612AQGIvml20nDQHg/article-inline_image-shrink_1000_1488/0/1651035032864?e=1669248000&v=beta&t=hS_hkAqd4BJkMzFG4Qn9pLbiWmu8pHx8y3yaQ1jqGTY) However, many organizations are still struggling with digital transformation to become data-driven. So, how should they approach this new challenge? ## Computing technology IoT (Internet of Things) is the source of big data; cloud computing facilitates the storage and processing of large data sets; AI (Artificial Intelligence) enables advanced analytics; ML (Machine Learning) learns and identifies data patterns and makes predictive analytics to perform operations without human intervention, and cognitive computing mimicking the function of the human brain helps to improve human decision making. Cognitive computing is the next generation of information systems that understand, reason, learn and interact with the business ecosystem. It is continually learning from past experience, building knowledge, understanding natural language, and reasoning, and interacting more naturally with human beings than traditional programmable systems. Cognitive computing is the third era of computing. We went from the first era with computers that tabulate sums (the 1900s) and the second era with programmable computer systems (1950s). ## **Data and analytics** Advancements in technology, especially in data & analytics, enable a range of unforeseen opportunities to amplify, automate and optimize business operations and decision making. After embarking on a [digital transformation journey](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) in the last decades. Now, data and analytics have become widespread, well understood, and used successfully in many organizations. Therefore, this would be a good starting point for organizations to embark on their AI transformation journey. A recipe from data and analytics to AI is a natural and pragmatic progression. Winning with data, analytics, and AI requires a holistic approach to data-driven, analytics-enabled, and AI-powered technology strategy. ## **Artificial intelligence** Artificial Intelligence (AI) seems to be the buzzword presenting both distracting hype and powerful opportunities to leap the business forward. Today, AI remains elusive, misunderstood, and captured the imaginations of many. What exactly is AI, how can we get there, what are the opportunities, what are the challenges, and what are the benefits, in practical terms? The exhibit below is the typical AI technology roadmap with its branches and approaches. ![AI technology roadmap](https://media-exp1.licdn.com/dms/image/C5612AQGom5KbRkDPKw/article-inline_image-shrink_1500_2232/0/1651036452483?e=1669248000&v=beta&t=oie1hJSuAAeIpaVvQu5Ww_A8FQiI2NRiEreIKJiLvPA) While data analysis is the process of turning raw data into clear, meaningful, and actionable insights, artificial intelligence (AI) is a data science field that uses advanced algorithms to allow computers to learn on their own from experience, adjust to new inputs and perform human-like tasks. It seeks to mimic human abilities and simulate human intelligence in a machine. Businesses produce massive amounts of data that are impossible for humans to keep up with. However, if we can analyze data by leveraging the power of artificial intelligence, then we can produce results far beyond what humans are capable of doing, in terms of speed, reliability, and accuracy. In other words, AI makes big data appear small. It automates and simplifies many humans’ tasks. AI is a broad field of study that includes many theories, methods, and technologies. The following are the major subsets of AI: **(Artificial Intelligence > Machine Learning > Deep Learning.)** ![Subsets of AI](https://media-exp1.licdn.com/dms/image/C5612AQFDv8SqWdgOTw/article-inline_image-shrink_1500_2232/0/1650950762902?e=1669248000&v=beta&t=ljysWOzJW6nwR8AAsIp7kDftAFOwkggxONENfD0az80) ## Machine learning Machine learning is a subset of AI that trains a machine how to learn. It is a data analysis method that automates the building of an analytical model and makes necessary adjustments to adapt to new scenarios independently. It uses methods from neural networks, statistics, and operations research to uncover hidden insights in data and develop pattern recognition capability that continuously learns from and makes predictions based on data. It continuously makes adjustments without being programmed and makes decisions with minimal human intervention. In general, there are four methods of machine learning: - **Supervised learning** works with labeled data sets and requires less training. - **Unsupervised learning** classifies unlabeled data set by identifying patterns and relationships. - **Semi-supervised learning** uses a small labeled data set as a guide to classify a larger unlabeled data set. - **Reinforcement learning** works on interacting with the environment and aims to maximize the rewards by hit-and-trial actions. The algorithm of machine learning is categorized based on the type of problem to be solved and the type of output to be generated. These algorithms are divided into three categories: - **Classification** is a supervised machine learning algorithm. The classification algorithm helps to sort and classify our data into different pre-determined buckets. - **Clustering** is an unsupervised machine learning algorithm. It is used to group data points having similar attributes or characteristics into a cluster. - **Regression** is a supervised machine learning algorithm. Regression is using an existing or past trend to predict an unknown value. [Robotic Process Automation in Finance: 5 benefits of RPAIn this post, you’ll find out how to use RPA to streamline financial processes. We’re also sharing five amazing benefits of using automated RPA software.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/robotic-process-automation-in-finance-2.jpg)](https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/) ### Deep learning Deep learning is a subset of machine learning that is superior to the traditional machine learning approaches. It uses a combination of multi-layer artificial neural networks and data that train a computer to perform human-like tasks. The deep learning model takes the advantage of advances in computing power and improved training techniques to learn complex patterns in large amounts of data that are typically unsupervised or semi-supervised. Some models are so effective that they began to surpass human abilities in many areas, such as voice and speech recognition, pattern or image recognition, and natural language processing. ### Neural networks As explained above, machine learning is a subset of artificial intelligence and deep learning is a subset of machine learning. The “deep” in deep learning is referring to the depth of layers in a neural network. To be precise, a neural network that consists of more than three layers, including the inputs and the output, can be considered a deep learning algorithm. Neural networks mimic the human brain through a set of algorithms. It is made up of interconnected units like neurons that process information by responding to external inputs and relaying information between each unit. This process requires multiple passes at the data to find connections and derive meaning from undefined data. ![nerual networks hidden layers and input and output layers](https://media-exp1.licdn.com/dms/image/C5612AQFEu7v-mj2NAQ/article-inline_image-shrink_1500_2232/0/1651035323847?e=1669248000&v=beta&t=pIT63evcA3FbGZn9OkgaadbdCbUPEVfC_ChmPDtt-co) ![Deep neural network](https://media-exp1.licdn.com/dms/image/C5612AQFWtwWWL4EqiA/article-inline_image-shrink_1500_2232/0/1650950889946?e=1669248000&v=beta&t=1hX4Xf6aXuPHED85BSkJ5Rwme-hHRBfVHwKLKkHJ6wA) There are many technologies that enable and support the development of AI. Below are several of them. ### Natural language processing Natural language processing (NLP) is a branch of artificial intelligence that helps computers to analyze, understand, interpret and manipulate human language in the form of text and voice. NLP helps computers communicate with humans in their own language by making it possible for computers to read text, hear speech, interpret meaning, and also measure sentiment. NLP is entering the next level of development with natural language interaction that will enable humans to communicate with computers using everyday normal language to perform human tasks. ### Computer vision Computer vision is a field of artificial intelligence that trains computers to interpret and understand the visual world. It relies on pattern recognition and deep learning to recognize the contents in a picture or video. With the ability to accurately identify, classify, process, analyze and understand objects, it can capture images or videos in real time to interpret their surroundings and take appropriate actions accordingly. Today, computer vision rivals and surpasses human visual abilities in many areas. ### The Internet of Things (IoT) The exponential rise of the Internet of Things (IoT) with connected devices in every corner of business operation has generated massive amounts of data, but most of it is unanalyzed and wasted. This opens a new frontier for organizations to have an IoT-enabled enterprise management system or enterprise digital platform that will mine and unlock the value of data by leveraging AI technology. This digital platform provides the ability to extend real-time data collected from distributed devices in the fields or shop floors to the C-Suite for operational and strategic decision-making. [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) ### Graphical processing unit (GPU) Graphical processing units are the key enabler to the development of AI technology because they provide the heavy computing power that is needed for real time iterative processing. Big data and computing power are required in the neural networks processing. ### Application programming interfaces (API) Application programming interfaces are portable packages of code that make it possible to add AI functionality to existing products and software packages. This is the open and modular approach in the modern software development environment. ### AI transformation strategy Just like [digital transformation](https://www.financealliance.io/maturity-assessment-finance-function-transformation/) or any transformation project, AI transformation is also less about the technology and more about the people and the strategy. Human beings are incredible creatures with so many unique capabilities that no machine can replicate - empathy, enthusiasm, imagination, passion, creativity, flexibility, and inventiveness. Therefore, it is critical to take a human-centered approach to AI transformation. The right AI transformation approach is for technology to adapt to people and strategy, not the other way around. To achieve comprehensive and successful AI transformation, organizations must democratize AI by implementing no-code or low-code tools and platforms in order to bring the power of AI to the desktop of every employee. With access to AI as part of their everyday routine tasks, everyone in any function and in any position can get more things done and do things that were not possible previously. They can find critical information, uncover hidden insights, automate repetitive tasks, improve collaboration, etc. A successful AI transformation strategy must consider cultural issues as well as business issues. This requires a fundamental transformation in how things are done, how employees relate to each other, what are the skillset and mindset needed, what are the processes and guiding principles, etc. It is the people that make the difference. Data scientists and developers working in isolation often deliver models that lack business knowledge, purpose, or value. Similarly, business people working in isolation lack the technical knowledge to understand what can be done from AI and data science perspective. However, by enabling cross-functional teams and making those that know the business a central piece of your AI transformation process, we can create powerful and effective AI solutions. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### 5 benefits of robotic process automation in finance URL: https://www.financealliance.io/5-benefits-of-robotic-process-automation-in-finance/ Last updated: 2022-09-15T16:20:43.000Z The emerging field of robotic process automation (RPA) in finance is proving to be a real game-changer for finance teams. Instead of being chained to spreadsheets all day, RPA gives finance professionals more input in strategic business decisions. Finance automation lets finance professionals complete tedious tasks in a fraction of the time it usually takes. Driving greater efficiency and compliance while reducing human error are just a few of the reasons why automation in finance is so beneficial. But why should businesses embrace finance automation? And, how are automation and machine learning impacting the everyday roles of finance professionals? In this post, you’ll find out how to use RPA to streamline financial processes. We're also sharing five amazing benefits of using automated RPA software. Here’s a breakdown of what we’re covering: - [What is robotic process automation in finance?](https://www.financealliance.io/p/0291a0dc-8e5e-4163-978a-3882357d8f99/#what-is-robotic-process-automation-in-finance) - [Top advantages of finance automation software:](https://www.financealliance.io/p/0291a0dc-8e5e-4163-978a-3882357d8f99/#5-advantages-of-finance-automation-software) [1\. Consistent accuracy](https://www.financealliance.io/p/0291a0dc-8e5e-4163-978a-3882357d8f99/#1-consistent-accuracy) [2\. Increased productivity and efficiency](https://www.financealliance.io/p/0291a0dc-8e5e-4163-978a-3882357d8f99/#2-increased-productivity-and-efficiency) [3\. Automation in finance is a cost-effective solution](https://www.financealliance.io/p/0291a0dc-8e5e-4163-978a-3882357d8f99/#3-automation-in-finance-is-a-cost-effective-solution) [4\. Manages regulatory compliance](https://www.financealliance.io/p/0291a0dc-8e5e-4163-978a-3882357d8f99/#4-manages-regulatory-compliance) [5\. Boosts employee engagement and fulfillment](https://www.financealliance.io/p/0291a0dc-8e5e-4163-978a-3882357d8f99/#5-boosts-employee-engagement-and-fulfillment) ## ****What is robotic process automation in finance?** Robotic process automation (RPA) is software that automates repetitive tasks and processes. Think of it like a swarm of low-code user-friendly software ‘bots’ that access user interfaces to automate tedious finance tasks, such as: - Accounts reconciliation - Financial statements - Invoice processing - Data entry - Compliance reporting - Reports - Order to cash - Procure to pay - Tax reporting automation - Accounts receivables - Other finance and accounting processes …and more. RPA tools and software are extremely intelligent. Software robots can do many amazing things to make your life as a finance professional that much easier. Some of which, include: - Understanding what’s displayed on a screen - Navigating complex systems - Extracting data - Reviewing reports - Flagging potential issues Robotic process automation can perform a range of tasks but you must understand what RPA is, and what it isn’t. For example, RPA is computer-coded software. So, don’t expect any life-like robots sitting at your desk any time soon. The main focus of RPA in finance is to replace repetitive and rule-based tasks. Finance automation software also tends to use cross-functional and cross-application macros. Here are some specific examples from [Deloitte’s report](https://www2.deloitte.com/content/dam/Deloitte/tr/Documents/technology/deloitte-robots-are-ready.pdf) on what RPA in finance can do: - Opening emails and joining attachments - Automatically logging into various applications on the web - Shifting folders and files - Copying and pasting - Completing forms - Collecting data from databases and the web - Making calculations - Connecting to system API - Extracting structured data from documents - Gathering stats from social media - Following if/then decisions and rules [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) ## ****5 advantages of finance automation software** Finance automation is putting an end to repetitive tasks and helping finance teams embrace digital transformation. But just how popular is RPA in finance? Well, Gartner would have us believe it’s **highly* popular. According to their white paper, ‘[**Robotic Process Automation in Finance*](https://www.gartner.co.uk/en/finance/insights/robotics-in-finance),’ 80% of finance leaders have implemented or are planning to implement robotic process automation (RPA). With so many finance leaders holding up a torch for RPA and finance automation software, it makes you wonder **why*. What is it about RPA that has convinced all of these finance leaders that robots are the way forward? That’s what we wanted to find out. So, here are the top five benefits of RPA in finance: ### ****1\. Consistent accuracy** Humans make mistakes. There’s no shame in that. But what if you could remove human error and ensure consistent accuracy across critical processes within the finance function? Well, it’s now possible thanks to RPA software. Reducing the margin of error is one of the best benefits of automating key financial processes. Human error can cause upheaval and negative consequences that could ripple throughout the business. For example, errors in accounts payable could lead to unplanned costs for the business. Or an incorrect or duplicated invoice could set about a double payment catastrophe. Okay, that’s a little overdramatic, but you get the idea. Robotic process automation can take human error off the table and help to achieve consistency and accuracy across the organization. ### ****2\. Increased productivity and efficiency** RPA and AI (Artificial Intelligence) reduce processing times and streamline various processes across the finance function. According to [research](https://www.uipath.com/blog/digital-transformation/new-research-shows-workers-concerned-skills-gaps), 68% of global workers believe that automation makes them more productive. And since the robots are handling mundane tasks, 42% believe RPA allows greater opportunity to focus on more important work. Automating manual tasks that take a lot of time and mental brain-power is music to many finance professionals’ ears. Instead of manually entering data from one spreadsheet to another, the software does it for them. Not to mention, modern technology is incredibly fast. The right finance automation software can retrieve and compile data from multiple systems at the same time. Maximum efficiency and improved productivity lead to increased gains for the business. When you spend less time on tedious tasks, you'll have more time to contribute toward strategic business decisions. [5 ways CFOs can accomplish finance digital transformationAs the CFO, you’ll lead the charge for finance digital transformation within the organization. But doing so takes some work. Here are 5 ways CFOs can drive finance digital transformation, optimize business processes, and even enhance overall profitability.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/finance-digital-transformation.jpg)](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) ### ****3\. Automation in finance is a cost-effective solution** Did you know that RPA drives major cost savings? Many companies that have implemented robotic process automation in finance see substantial ROI. Time-to-value varies across different companies, but the process of reducing manual work hours leads to reduced cost and increased output per employee. You could save between 25% and 50% according to [Kofax](https://www.kofax.com/learn/blog/benefits-of-rpa), which we doubt any company would say no to. RPA can also help to drive growth by analyzing customer behavior data. Grouping customers into specific categories and targeting products or services that are most likely to grab their attention is just one possible tactic to help generate sales. And finally, RPA isn’t going to cost you a lot. It’s actually pretty cheap compared to some other high-tech automated software. In some cases, it’s more affordable to use RPA than to hire a full-time employee. [Gartner](https://www.gartner.co.uk/en/finance/insights/robotics-in-finance) reports that robotic process automation technology usually costs one-third the amount of an offshore employee and one-fifth of an onshore employee. ### ****4\. Manages regulatory compliance** Regulatory fines and damage to your company’s reputation are serious concerns for any business. The good news is that RPA can strengthen your company’s compliance. It consolidates data and even locates and stores specific data to help an auditor complete accurate reviews. In turn, this leads to efficient decision-making. By improving business operations, robotic process automation in finance can increase the efficiency of a compliance program. Reducing legal issues and saving money at the same time are just two extra bonuses of using RPA to improve compliance. According to [Deloitte](https://www2.deloitte.com/content/dam/Deloitte/tr/Documents/technology/deloitte-robots-are-ready.pdf), confidence in RPA’s capacity to deliver benefits such as improved compliance, quality, and improved productivity remain high (in the 85% to 92% range). [3-step maturity assessment for finance function transformationWant to achieve a successful finance function transformation? Start by following this 3-step maturity assessment framework!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AlliancePierre-Alain Liegeois![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/businessman-g63ce8b3c6_1920-2.jpg)](https://www.financealliance.io/maturity-assessment-finance-function-transformation/) ### ****5\. Boosts employee engagement and fulfillment** Finance professionals are the unsung heroes of countless organizations around the world. They’re the ones who collect and analyze data and help senior management make better-informed business decisions. So, why not make their lives easier by implementing some useful RPA solutions to help streamline the existing process? RPA has been known to help employees reduce stress by taking manual and repetitive tasks off their plates. Manually entering data into spreadsheets should be left where it belongs – in the distant past. Nobody wants to sit at a desk all day entering data. Outdated systems decrease productivity and can lead to employee burnout. Nowadays, new software and technology have automated data collection and organization in ways never before thought possible. The result? Happier and more engaged employees. ### ****Key takeaways** 1. The main focus of RPA in finance is to replace repetitive and time-consuming tasks. 2. Reducing the margin of error is one of the best benefits of finance automation. It helps to achieve consistency and accuracy across the organization. 3. Research has shown that RPA improves productivity. 68% of global workers believe that automation makes them more productive. 4. It’s cheaper to invest in RPA technology than to hire a new employee to complete the same, mundane tasks. In fact, RPA technology usually costs one-third the amount of an offshore employee and one-fifth of an onshore employee. 5. By improving business operations, robotic process automation in finance can increase a company’s compliance. --- ****Want to read more articles about robot process automation in finance? Check out our library of** [****finance transformation articles**](https://www.financealliance.io/tag/finance-transformation/) **right here.** [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### CFO: Reliable and trustworthy URL: https://www.financealliance.io/cfo-reliable-and-trustworthy-framework/ Last updated: 2024-06-20T13:51:56.000Z For a CFO, being seen as reliable and trustworthy is non-negotiable. It's an essential leadership quality. People need to know beyond a shadow of a doubt that they can count on their CFO to be completely honest, ethical, and consistent through and through. This bedrock of trust lays the foundation for everything - from having a loyal, dedicated finance team to instilling confidence in [investors and stakeholders](https://www.financealliance.io/cfos-role-in-investor-communications/). When a top CFO makes a commitment or says they'll do something, it's ironclad. Their team and colleagues know it's as good as done. They never have to second guess or worry. A CFO who projects an aura of trust elevates their whole organization. It fosters an environment of accountability and integrity. Integrity like that is priceless. It gives CFOs true authority and gravitas that money can't buy. Their teams know they can always be relied upon to do the right thing, to have their backs, to give it to them straight. And that's what allows top CFOs to rally people and inspire excellence. ### How CFOs predict and prepare for a financial crisis URL: https://www.financealliance.io/how-to-prepare-for-a-financial-crisis/ Last updated: 2025-04-05T07:42:40.000Z With the cost of living soaring and a potential recession knocking on our doors, it’s no wonder that business owners are turning to their Chief Financial Officers (CFOs) for advice and support. After all, CFOs are strategic thinkers and financial experts. If anyone can navigate a business through dark times, it’s them. So, where does that leave you – the CFO currently reading these words and feeling the pressure mounting on your shoulders? What can *you* do to prepare for a financial crisis? In this article, you’ll learn about the most common warning signs that there’s a financial crisis looming and how to prepare for one as the CFO of a company. Topics covered in this article include: - [What is a financial crisis?](https://www.financealliance.io/p/428bdead-d582-413a-ae50-3ea0f135a199/#what-is-a-financial-crisis) - [What are the signs that a financial crisis is on the horizon?](https://www.financealliance.io/p/428bdead-d582-413a-ae50-3ea0f135a199/#8-signs-a-financial-crisis-is-on-the-horizon) - [How can CFOs help businesses prepare for a financial crisis?](https://www.financealliance.io/p/428bdead-d582-413a-ae50-3ea0f135a199/#how-to-prepare-for-a-financial-crisis) ## What is a financial crisis? A financial crisis hits when asset prices experience a steep decline in value. This is often paired with both businesses and consumers struggling to keep up with their debts and financial institutions experiencing a significant shortage in liquidity. Financial crises can be extremely stressful and ominous times. Often, a financial crisis is preceded by signs of an economic boom. Overextension of credit to borrowers is usually on the cards and after the financial crisis hits, you can expect a wave of economic recessions ready to take its place. ![Signs of a financial crisis - prepare for a financial crisis or recession - sign post]() ## **8 signs a financial crisis is on the horizon** You don’t need a crystal ball to predict a financial crisis. There are often identifiable signs that such a crisis is on the way. And if you know what to look out for, you can prepare for the aftermath and make strategic decisions to ensure your business survives. Here are eight signs that a financial crisis or recession could be on the way: ### **1\. Stock market crashes** One of the best ways to predict a recession or financial crisis of any kind is via the health of Wall Street and the stock market. It’s a reliable indicator of just how well (or unwell) the economy is performing. A flourishing stock market is a really good sign. But if stock prices are low across the board with very little sign of recovery, it could signal an approaching recession. ### **2\. Reduced bank capital** Banks struggle to absorb losses during a downturn. If one or more of the ‘big banks’ fail, it could have a domino effect of negative implications across the economy. Setting measures in place to deal with a possible banking crisis is one of the best ways to try and prepare for such an event. ### **3\. Increased private debt** Secured lending on an asset that is overvalued is a potential warning sign of a financial crisis looming. Increased rates mean that businesses and consumers are giving up a portion of their income and finances to pay that interest. This means they’ve got less money in their pockets to spend or invest. Paying off their private debts becomes the priority and spending and investing move down the ladder of importance. [4 roles every CFO must dominate:The changing role of the CFOTraditionally, the roles of the CFO consisted of the Operator and Steward. But now, those roles have evolved. Discover the 4 roles every CFO must master in this podcast episode and blog post.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO.jpg)](https://www.financealliance.io/podcast/4-roles-every-cfo-must-dominate-changing-role-of-the-cfo/) ### **4\. Rising inflation** Whilst some level of inflation isn’t always a bad thing, a lot of inflation is not good. Rising inflation leads to more expensive borrowing. This then escalates and makes businesses less likely to borrow money or invest in new software, equipment, or people. Currently, [inflation remains elevated at 9.1%](https://www.npr.org/2022/07/27/1113494056/fed-interest-rate-hike-july-meeting), which is the highest in four decades. Could this be a warning sign that a recession is on the way? That remains to be seen. ### **5\. A drop in real estate** With rising interest rates and mortgage rates in 2022, the housing market is starting to slow down as potential applicants hold out in hopes of lower rates shortly. A decline in housing construction and sales is a clear sign that a financial crisis could be on the way. CFOs should pay close attention to real estate, whether they’re in the industry or not. ### **6\. A bank run happens** A bank run is like when you see a flock of birds fly away from an area just before a storm hits. Similarly, just before a recession comes tumbling in, many customers will often deposit their money from their banks. They do this over rising concerns that if they leave their money in the bank, it’ll lose value. So, they withdraw their funds and deposits, which can lead to banks potentially struggling to cover the withdrawals. ### **7\. Increased oil prices** In the past, periods when oil prices went through the roof, have led to times of financial crisis or recession. Keep in mind that increased oil prices don’t always mean that there is going to be one. However, it’s worth keeping a close eye on those rising oil digits in the United States and other countries around the world. ### **8\. An inverted yield curve** Inverted treasury yield curves might be a sign that a recession is coming. Yes, treasury bonds are usually very reliable in terms of a long-term investment choice. However, when you notice an inverted yield curve happening, it’s time to get your ducks in a row *ASAP*. ![how to prepare for a financial crisis - image of a magnifying glass and house]() ## **How CFOs can predict and prepare for a financial crisis** [15% of CFOs](https://www2.deloitte.com/us/en/pages/finance/articles/economic-cycles-what-should-cfos-prepare-for-now.html) say they can already see signs of a downturn in their company’s operations. So, what are these CFOs doing to prepare for a potential financial crisis? Just under 40% of CFOs are already taking action with offensive or opportunistic planning while 25% have created a detailed plan to follow in the event of a financial crisis. It’s worth having some type of plan in action should a financial crisis strike. However, there are some other things you can do today to help prepare for a financial crisis, some of which include: ### **Reducing headcount** CFOs are under a lot of pressure to prepare businesses for an economic downturn. One of the main actions they’re taking is reducing headcount. [54% of CFOs](https://www2.deloitte.com/us/en/pages/finance/articles/economic-cycles-what-should-cfos-prepare-for-now.html) agree that a hiring freeze or reduction is an effective method to reduce headcount. Plus, 20% of CFOs have already begun to undertake a hiring freeze, which is food for thought. ### **Reducing leverage** There are different ways you can reduce leverage such as canceling or delaying investments and retiring debt. This is one of the most common strategies that CFOs use to help prepare for a financial crisis or recession. ### **Monitor cash flow** Assuming you’re already on top of your company’s cash flow management, it becomes more important than ever to monitor cash flow daily in the run-up to a potential recession. You know what they say, cash is king. And if that’s true, you need to make sure the company has enough cash coming in to support it in the event of an economic downturn. Having an emergency fund and savings accounts to help see the company through is extremely important to prepare for a financial crisis. [7 cash flow management strategies for busy finance teamsHow can you make sure that your cash flow management strategy is a booming success? In this article, we share seven simple but effective cash flow management strategies for busy finance teams...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/cash-flow-management-strategies.jpeg)](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) ### **Develop good relationships with banks** A financial crisis is the worst time to go to a bank that’s never heard of you and demand help. As the CFO, it’s advised that you work on building good bank relationships way before you ever need financial aid to tie you over. Set up a line of credit early. That way, if your company ever needs financial help, you’ll already have those connections where and when you need them most. ### **Predictive analytics** Ding dong, it’s time to leverage predictive analytics and [data management](https://www.financealliance.io/why-cfos-need-financial-data-management/) for all they're worth. Forecast potential scenarios of a financial crisis and create action plans to help your business make the best possible decisions to cope if any of those events were to happen. Use relevant data to predict how the business will fare in the event of a global financial crisis, for example. You should also locate sources of cash. Don’t worry, we’re not going to send you off on a hunt for buried treasure. But we do advise that you identify sufficient sources of cash sooner rather than later. ### **Optimize costs** Finally, make optimizing expenses your top priority when preparing for a recession. [79% of mid-market finance leaders](https://www.highradius.com/resources/ebook/cfo-office-challenges-trends-2022/) say cost optimization is a top priority for them in 2022 and beyond. This isn’t that surprising considering optimizing expenses is one of the best strategies to survive a major financial crisis and there’s no better person for the job than you as the CFO. You already know where the company is spending money. So, figure out where you can cut costs. Monitor where every dollar is spent and seek out the most cost-effective ways to reduce spending. --- **For organizations to survive, they must embrace finance transformation, which is why we're launching the State of Finance Transformation Report 2022!** **Get the story *behind* the data and discover how a successful adoption of finance transformation can drive positive change within your organization.** **But we can't create this report without your help.** [**Take the survey today**](https://www.financealliance.io/state-of-finance-transformation-report-2022/)**.** ### How to make your finance team lean: 5 principles of lean finance URL: https://www.financealliance.io/how-to-make-your-finance-team-lean-5-principles-of-lean-finance/ Last updated: 2025-04-05T07:43:39.000Z If you want to develop a world-class finance team, you've got to embrace lean finance. Lean finance simplifies and streamlines various processes to create a more effective and efficient finance operation. But what does 'lean finance' really mean? And how can you make your finance team lean? In this article, you'll discover the five principles of lean finance for transformative results. ## 5 principles of lean finance Lean offers a framework and tools that can help your team improve its productivity and impact without disrupting the things you love about your culture. Lean began at Toyota and is widely used throughout the automotive and aerospace manufacturing industries. However, it has also been successfully applied outside of manufacturing environments in industries ranging from banking to law firms. The two pillars of Lean are Continuous Improvement and Respect for People. Lean emphasizes delivering value to the customer and empowering employees to improve their processes. Implementing Lean can lead to higher employee engagement as well as improved results. It helps to define what it means to be better, empowers everyone to make improvements, and keeps score so everyone gets the satisfaction of being on a winning team. Team members are encouraged to “fix what bugs them” and to shift their workday toward more fulfilling value-adding work and away from inefficient processes that waste their time. [How technology improves planning budgeting and forecastingTechnology is transforming financial planning and analysis (FP&A). But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceBrian Kalish![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Planning-budgeting-and-forecasting.jpg)](https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/) I have successfully applied these 5 principles of Lean Finance to several Finance organizations and seen transformative results. Here are the 5 principles of lean finance: ### Challenge Each improvement starts with a challenge – to solve a problem or to reach a target. Teams should identify and share [key performance indicators](https://www.financealliance.io/infographic-financial-performance-metrics/) (KPIs) and challenge themselves to improve them. We develop the people on our teams by encouraging them to set targets and to use the plan, do, check, act (PDCA) cycle to make improvements to realize them. Develop quarterly initiatives to take larger, coordinated steps toward a target state. ### Empowerment Each of us is empowered to make improvements in our areas. Problems and opportunities are best seen where the work is performed. So the people closest to the work need to be able to “pull the Andon Cord” when they see an opportunity for improvement. We have both the right and the responsibility to do so. Add to your team’s list of improvements, problems, and opportunities (IPOs) whenever you see an IPO even if you need some help to solve it. [7 cash flow management strategies for busy finance teamsHow can you make sure that your cash flow management strategy is a booming success? In this article, we share seven simple but effective cash flow management strategies for busy finance teams...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/cash-flow-management-strategies.jpeg)](https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/) ### Continuous improvement mindset This principle is about getting to the root cause of an issue and eliminating waste. Don’t walk past a problem. Get to the root cause of errors and change the process to prevent them from ever recurring – even if the problem is coming from another department upstream. Continuous improvement means that when we close the books, we're also improving our process for closing the books; when we run payroll, we improve our process for running payroll. ### Standard work Establish standard work and continuously improve it. Maintain process maps. “Standard work” means the repeatable process or standard template used to get a consistent result. It is the foundation of continuous improvement. Where there are no standards, there can be no improvement. It is virtually impossible to optimize a process without documenting what it is. The as-is process maps become the basis for process improvements and must be updated each time an improvement is made. ### Voice-of-the-customer Identify the customer (internal or external), seek voice-of-the-customer input, and optimize processes to enhance value to the customer. Waste can be defined as “anything the customer would be unwilling to pay for.” So to understand what the customer values, we need to identify the customers and hear about the value we are delivering from *their perspective*. ### Key takeaways 1. Lean offers a framework and tools to help improve your team's productivity and impact *without* disrupting the things you love about your culture. 2. Identify and share key performance indicators (KPIs) and challenge yourself (and your team) to improve them. 3. Empower your team by focusing on improvements, problems, and opportunities (IPOs) for growth. 4. If there's a problem, get to the root cause of it and try to solve it. 5. Establish standard work, continuously improve it, and maintain process maps. 6. Identify the customer (internal or external), seek voice-of-the-customer input, and optimize processes to enhance value to the customer. --- **Want to continue this conversation with other CFOs and finance professionals?** **Sign up for our** [**Finance Alliance Slack community**](https://www.financealliance.io/community/) **(it's free!).** [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### How technology is impacting the planning, budgeting & forecasting function URL: https://www.financealliance.io/how-technology-improves-planning-budgeting-forecasting/ Last updated: 2022-09-14T12:51:34.000Z Are your existing planning, budgeting, and forecasting processes looking a little… worse for wear? Dealing with mountains of datasets isn’t easy. There’s only so much a finance professional can handle before they need some help. Thankfully, there is an excellent solution to the problem. Technology is transforming financial planning and analysis (FP&A) in ways that have transformed traditional planning, budgeting, and forecasting processes. But how? In this post, you’ll discover how technology is impacting the budgeting function and modernizing how finance professionals work. Keep reading to learn: - [How companies leverage technology to strengthen their planning, budgeting, and forecasting functions](https://www.financealliance.io/p/8bca8b9c-e2ec-4224-b03b-2968cadcea9b/#how-technology-can-revolutionize-your-planning-budgeting-and-forecasting-processes) - [How to avoid common mistakes](https://www.financealliance.io/p/8bca8b9c-e2ec-4224-b03b-2968cadcea9b/#how-to-avoid-common-finance-transformation-mistakes) - [Building the possibility for higher-value activities: The 3 C’s](https://www.financealliance.io/p/8bca8b9c-e2ec-4224-b03b-2968cadcea9b/#building-the-possibility-for-higher-value-activities-the-3-c%E2%80%99s) - [Four planning, budgeting, and forecasting trends to watch](https://www.financealliance.io/p/8bca8b9c-e2ec-4224-b03b-2968cadcea9b/#planning-budgeting-and-forecasting-trends-to-watch) - [Three business case examples of leveraging technology for FP&A](https://www.financealliance.io/p/8bca8b9c-e2ec-4224-b03b-2968cadcea9b/#business-case-examples-of-leveraging-technology-for-planning-budgeting-and-forecasting) - [How to get buy-in from stakeholders](https://www.financealliance.io/p/8bca8b9c-e2ec-4224-b03b-2968cadcea9b/#finance-transformation-how-to-get-buy-in-from-stakeholders) - [How organizations can adapt to change](https://www.financealliance.io/p/8bca8b9c-e2ec-4224-b03b-2968cadcea9b/#how-organizations-can-adapt-to-change) ### ****How technology can transform your budgeting processes** Automation and technology have made our lives so much easier and more convenient. Yet, many organizations miss out on the opportunity to improve their budgeting processes by utilizing technology the right way. When it comes to the traditional budgeting process, three major complaints often arise: 1\. It takes a long time, costs too much, and consumes too many corporate resources. 2\. It’s fixed and inflexible and can quickly become irrelevant. 3\. Most companies tie executive and employee compensation directly to performance against the budget. What many businesses don’t know is that none of these issues are impossible to fix. Instead of typing budgeting data into spreadsheets, technology can take the burden of mundane tasks **off* your plate. Technology can build systems that sync with the general ledger. Data can be almost instantly loaded exactly where you want it – all while improving accuracy and reducing potential errors. With automation, you won’t have to worry about irrelevant or outdated data clogging up your spreadsheets. Your planning, budgeting, and forecasting data is reported in real-time. Budgets may not be going away, but technology can make the process a lot easier. ### ****How to avoid common finance transformation mistakes** Finance transformation relies on innovative technology to reconstruct and install more effective and efficient planning, budgeting, and forecasting functions. One mistake to avoid is setting too broad a goal, such as having a “best-in-class” budgeting function. This kind of thinking leads to a line-up of potential problems, including: ****➢ Solely focusing on costs alone** *Tunnel vision for the cheapest options may not be the best way forward.* ****➢ Not fully understanding business complexity** *You need a strong understanding of the business, how it operates, and the industry it operates in.* ****➢ Seeking universal satisfaction** *You can’t please everyone!* So, how can you avoid making these mistakes? And, how can you move towards a successful implementation of finance transformation? First, it’s important to have a clear and concise vision. Think about what a successful adoption of finance transformation looks like for you. What do you hope to achieve? What do you want to change or improve? Zone in on your vision and make sure you can share that vision with others when necessary. Next, make sure you're focusing on the right areas and outcomes. Your organization should focus on return on investment (ROI) rather than minimizing cost. Consider what you’ll gain from this movement toward finance transformation. Some possibilities include more accurate planning, budgeting, and forecasting strategies and increased productivity. Another important aspect of finance transformation is setting goals and deciding what to *stop* doing. Consider what technology and budgeting and forecasting software to invest in. There are many options to choose from, many of which can help improve your existing business planning and strategic planning processes, for example. [How finance automation is changing the role of FP&AHow has digital transformation and finance automation changed the role of FP&A professionals forever? Find out in this article!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/artificial-intelligence-g1f6b9f8a4_1920.jpg)](https://www.financealliance.io/how-finance-automation-is-changing-role-fpa/) ### ****Building the possibility for higher-value activities: The 3 C’s** I’m a huge believer in the ‘3 C’s: 1. Capacity 2. Capability 3. Collaboration If you don't have the capacity, you have nothing. If it takes 30 days to do the accounting close, that’s all you’ll get done in those 30 days. But, if you hire the right people and leverage technology, you can reduce the time it takes to complete those tasks. The next question to ask yourself is if your people and technology have the capability. If you’ve got the capacity and capability, you can collaborate. Building change starts from within. If you want to change, you must own it. You’ve also got to manage your business partners’ expectations. By trying to please everyone, you may end up pleasing no one. It’s very important to realize and embrace finance transformation as an ongoing process and not a one-off exercise. ## ****Planning, budgeting, and forecasting trends to watch** ****Robotics will take over more planning, budgeting, and forecasting operations** Working smarter with robots is on the horizon for finance teams around the world. And don’t worry, they’re not coming for your job! ****Benefits:** - Reduced cost - More automated handling of routine tasks (cash flow management, monthly or quarterly forecasts, rolling forecasts, and other financial and operational tasks.) - Higher productivity - Fewer errors - More time for strategic activities - More responsive to regulatory, compliance, and risk issues ****Challenges:** - Skill sets of the finance team and overall workforce will need to shift - Machine-to-human interaction is still evolving ****Budgeting processes and technologies will continue to evolve** Budgeting processes and technologies will continue to evolve and include: - Advanced analytics and forecasting - Robotic process automation - Cloud and SaaS - Machine learning - Artificial intelligence - Blockchain ****Benefits:** - More relevant and accurate data supports better planning, budgeting, and forecasting - More frequent updates - More flexible tools for data-driven forecasts ****Challenges:** - Concerns over scrapping traditional planning, annual budgeting, and long-term forecasting processes - Difficulty recruiting team members with the skills needed ## ****Business case examples of leveraging technology for planning, budgeting, and forecasting** If you’re wondering how businesses leverage technology and planning software to streamline processes across the finance function, here are three business case examples: ### ****Example 1** ****Who?** - One of the ‘Big 10’ universities - 50k students, 12k Faculty ****The Challenge** - Budgeting Technology was antiquated - Business processes had been created around inefficiencies in the technology - Retiring System Administrator - VP of Finance has seen IBM advertisements on TV showing people ‘shooting analytics from their fingertips’ ****The Solution** - Implement IBM Planning Analytics - Define ideal state business processes, and build the technology to suit [3 important things to know about financial performance analysisEven if you’re experienced at it, there are a few important things about measuring a company’s financial performance that even the experts can overlook. In this blog post, we’re digging into three things every CFO should know about financial performance analysis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/finanical-performance-analysis-header-image.jpg)](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/) ### ****Example 2** ****Who?** - National convenience store and gas retailer - 800+ locations, HQ in Tulsa, OK - 20,000 employees - Fortune Magazine “Best Companies to Work for” 14 years in a row - Strong service culture ****The Challenge (2014)** - All financial planning and reporting in Excel - The delay in receiving useful information was so great that the information was no longer useful - Data blind ****The Solution** - Implement corporate performance management processes - Leverage IBM® Cognos® TM1® (now known as planning analytics) - Workforce performance management & planning - Annual financial budgeting - Monthly & annual financial reporting ****The Results** Information is now: - Visible - Timely - Accurate - Reliable - Dissectible - Trusted --- ### ****Example 3** Who (2010) - A low-cost airline - 10-15 aircraft flying the “Triangle” (BNE/SYD/MEL) ****The Challenge (2010)** - Australian domestic airline market has two dominant players - Ansett (30 % market share) goes into liquidation - The airline expands rapidly to fill a market gap - Company is still being run like a startup - Finance & some operations run on Excel spreadsheets - Budgets are being changed mid-year - Reports are completely untrusted and open to adjustment - Decision makers have no control over the results they see - A multi-billion dollar company being run like a startup ****The Solution** - Implement IBM® Cognos® TM1® - New CFO - “If it’s not in TM1, it doesn’t exist” - Driver-based budgeting - Performance managed to plan ratios ****TM1 Models Built:** - Financial budgets - Financial reporting - Flight reconciliation - Heavy maintenance planning - Route profitability - Catering planning - Demand planning & pricing - Workforce planning [5 ways CFOs can accomplish finance digital transformationAs the CFO, you’ll lead the charge for finance digital transformation within the organization. But doing so takes some work. Here are 5 ways CFOs can drive finance digital transformation, optimize business processes, and even enhance overall profitability.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/finance-digital-transformation.jpg)](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) ## ****Finance transformation: How to get buy-in from stakeholders** There are many ways of increasing the chance of gaining buy-in from relevant stakeholders. But first, you’ve got to identify who your key stakeholders are. Once you know who you need to convince, take time to identify their specific needs and requirements. Then, you must engage their head, heart, and hands: ****The Head:** With communications that are explicit and inclusive. ****The Heart:** Stakeholders will come to believe that finance transformation is the right action for the organization. ****The Hands:** Stakeholders and support teams must be competent to bring the finance transformation into being. It’s also important to get support from senior management and make conscious efforts to track and measure progress. Lack of buy-in from senior management is one of the main reasons finance transformations fail. Making sure they are on board is *critical*. ## ****How organizations can adapt to change** Success at finance transformation demands more than the best strategic and tactical plans. It requires an intimate understanding of the human side as well. Change is inherently unsettling for people at all levels of an organization. But, organizations that work well together, that are aligned and committed to the transformation initiative, are best positioned for success. Remember that individuals are inherently rational. They're likely to question to what extent the transformation is needed. They'll also consider whether the company is headed in the right direction and whether they want to personally commit to it. The best way for an organization to adapt to change is with well-planned, consistent communications that go both ways. Here are a few more tips to help your organization modernize and adapt to a fast-changing, technological environment: - The most successful transformation initiatives reinforce core messages through the delivery of timely and regular updates. - Communication needs to be both outbound and inbound. - Organizational change requires communication through multiple, redundant channels. --- ### ****Key takeaways** 1. Finance transformation relies on innovative technology to reconstruct and install more effective and efficient financial planning and analysis (FP&A) processes. 2. Avoid basing your budget requests on realistic assumptions - this could lead to decreased funding. 3. You need the 3 C’s to implement finance transformation successfully: capacity, capability, and collaboration. 4. To get buy-in from stakeholders, you must engage their head, heart, and hands. 5. The best way for an organization to adapt to change is with well-planned, consistent communications that go both ways. --- **For organizations to survive, they must embrace finance transformation, which is why we're launching the State of Finance Transformation Report 2022!** **Get the story *behind* the data and discover how a successful adoption of finance transformation can drive positive change within your organization.** **But we can't create this report without your help. [Take the survey today](https://www.financealliance.io/state-of-finance-transformation-report-2022/).** ### CFO: Influence and persuasion URL: https://www.financealliance.io/cfo-influence-and-persuasion-framework/ Last updated: 2024-06-20T13:47:40.000Z Today’s CFOs are leaders through and through. They’re heavily involved in not only managing and leading a team but also assisting with [team building and recruitment](https://www.financealliance.io/finance-talent/). Therefore, successful CFOs must have good leadership skills. Bringing the team together and making sure everyone is supported and empowered within their roles is so important. The CFO needs to be a great leader who can strategically manage the team. They also must take leadership in the C-Suite. This involves showcasing leadership skills when assisting the CEO and other board members with key decision-making. By articulating the why behind decisions and painting a clear picture of the end goal, a CFO can rally their team to push through challenges and achieve great results. So [leadership](https://www.financealliance.io/financial-leadership-in-changing-times-2/) \- getting people aligned, motivated and moving in the right direction – is one of the most vital CFO skills every CFO must try to master. ### 7 cash flow management tips URL: https://www.financealliance.io/7-simple-cash-flow-management-strategies-for-busy-finance-teams/ Last updated: 2025-04-05T07:43:51.000Z A healthy cash flow is a must for any growing business. Late payments or no payments at all can land your business in hot water. Worse still, you could end up drowning in debt if you don’t make cash flow management a top priority. Reducing cash flow problems and fixing existing issues is the best way to achieve positive cash flow and boost the financial health of your company. But how can you make sure that your cash flow management strategy is a booming success? Are there any simple but effective ways to improve your cash flow management strategies? And if so, what are they? In this article, we share seven simple but effective cash flow management strategies for busy finance teams, covering topics such as: - [What is cash flow management?](https://www.financealliance.io/p/1c0ccaed-bd62-4ad2-b484-5136f7ec0105/#what-is-cash-flow-management) - [Why is cash flow management so important?](https://www.financealliance.io/p/1c0ccaed-bd62-4ad2-b484-5136f7ec0105/#why-is-cash-flow-management-so-important) - [Common cash flow problems and struggles.](https://www.financealliance.io/p/1c0ccaed-bd62-4ad2-b484-5136f7ec0105/#common-cash-flow-problems-and-struggles) - [Seven tips to improve cash flow management and grow your business.](https://www.financealliance.io/p/1c0ccaed-bd62-4ad2-b484-5136f7ec0105/#7-simple-cash-flow-management-strategies-for-busy-finance-teams) ## **What is cash flow management?** Cash flow management is necessary to detect how much money your company needs to survive. It identifies exactly how much is needed to keep the company afloat and cover expenses such as debts, employees’ salaries, and suppliers. [3 Steps to create a digital reporting shortcut For CFOsHow can you as the CFO (and/or your finance team members) create a financial report that’s truly time-efficient? In this post, I reveal 3 easy steps to create a digital reporting shortcut for busy CFOs and their finance teams.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceDaniel Echeverri![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/lukas-blazek-mcSDtbWXUZU-unsplash.jpg)](https://www.financealliance.io/digital-reporting-shortcut/) ## **Why is cash flow management so important?** Cash flow management is vital to predicting how much money a company will have available in the foreseeable future. A large part of the cash flow management process is tracking how much cash is going in and out of the company. You’ll also monitor this amount against any outgoings including property costs and salaries. You’ll know when cash flow management is successful because it’ll present a clear picture of cost versus revenue. In turn, this makes sure the company always has enough money to pay any debts whilst remaining profitable. Forecasting company profits, spotting healthy investment opportunities, and fixing cash flow issues are all possible thanks to cash flow management strategies. Most importantly, it helps a company avoid potential cash flow issues that could lead to its financial demise. On that note, let’s take a look at some common cash flow problems and signs that it’s time to improve your cash flow management strategies. ![Cash flow management - cash flow scrabble letters]() ## **Common cash flow problems and struggles** It’s extremely rare that a company crashes and burns without a few warning signs. And even if you notice any of these in your organization, it doesn’t necessarily mean that the company is doomed. These are simply some common cash flow issues that, when they do appear, can be resolved with proper cash flow management strategies. Here are a few of the most common cash flow issues to look out for: - Late or missed payments piling up - Reduced or lack of profitability - Missing discounts on accounts payable - Withheld investment or funds - Negative cash flow - A struggle to maintain financial obligations ## **7 cash flow management strategies for CFOs and their teams** ### **1\. Monitor where the company is spending money and build a cash reserve** You’ve always got to monitor where the company is spending money and keep a close eye on cash inflow and cash outflow both short term and long term. One of the best places to start is in the past. Review company finances from the previous year to identify when the company was the most profitable, and when it struggled the most. From there, prepare cash flow projections and examine the company’s cash flow statements while looking out for information on debt, expenses, and savings. Maintaining a cash reserve for a rainy day can be the saving grace your company needs when it finds itself in hot water. If your company lacks a savings account, consider creating one and building up your cash reserve. ### **2\. Leverage technology to assist with cash flow management strategies** If you haven’t embraced technology yet in your finance role, now is the time to welcome it with open arms. New software and technology have revolutionized how finance professionals work. With the right technology, you can uncover new ways to streamline cash flow management strategies to help you budget and project future cash flow. Rather than manually typing data into a blank spreadsheet for hours, the technology can do it all for you. You’ll be able to see all of the accounts payable and accounts receivable, helping you to manage cash flow more effectively and efficiently. We have lots of great content about how finance teams can leverage technology and embed finance transformation within their organizations. [Check out our finance transformation articles here.](https://www.financealliance.io/tag/finance-transformation/) ### **3\. Build credit with potential lenders and vendors during the early stages of your cash flow management strategy** This is a tip you should put into motion long before you need help from lenders and vendors. The reason is that banks and vendors are usually not very eager to lend to a company stuck in a tricky financial situation. So, how can you get potential lenders and vendors on your side? The solution is to establish credit with them *before* you need it. As part of your cash flow management strategy, make a conscious effort to establish a line of credit for your company. And start working on this line of credit when the company is thriving. That way, if your company ever hits a cash flow crisis, those lenders and vendors will already know you and be more open to helping you when you need it most. [3 important things to know about financial performance analysisEven if you’re experienced at it, there are a few important things about measuring a company’s financial performance that even the experts can overlook. In this blog post, we’re digging into three things every CFO should know about financial performance analysis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/finanical-performance-analysis-header-image.jpg)](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/) ### **4\. Identify hidden cash from the balance sheet** Did you know that some accounts aren’t included in your company’s definition of working capital? That’s why it’s a good idea to take a closer look at the balance sheet, where you could uncover hidden cash such as accrued revenue or prepayments. Accrued revenue is common in SaaS companies. It refers to a sale that hasn’t been billed to the customer yet even though the seller has recognized the sale. Prepayments, on the other hand, are made to suppliers before a customer has received the product or service. Significant amounts of cash could be tied up in the balance sheet without you even realizing it. So, make sure to keep a close eye on the company’s balance sheet as part of your cash flow management strategy. ### **5\. Build a ‘strong cash culture’** One of the most effective ways to improve cash flow management is to create a strong cash culture within the company or organization. According to [McKinsey](https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/moving-from-cash-preservation-to-cash-excellence-for-the-next-normal), a cash culture relies on a holistic framework built across three dimensions: - **People:** Who does it? - **Structure:** What does it look like? - **Process:** How does it work? The first step is to make cash a top priority for the business owner of the company and communicate its importance throughout the organization. > *“Leaders signal to the rest of the organization that capital efficiency metrics (for example, cash conversion cycle) are as important as metrics related to pure profit and loss (P&L).* > *“A strong top-down message should be paired with capability-building programs to ensure that employees understand the importance of cash and that they have the tools and knowledge they need to make decisions based on both P&L and cash implications.”* – **McKinsey** ### **6\. Embed cash flow management KPIs and working capital metrics throughout the company** Despite what many people might think, the finance team shouldn’t be solely responsible for cash flow management. Other teams such as sales may need to get involved to help keep and maintain positive cash flow. If a customer is late on a payment, someone from the sales team or customer service, for example, is likely the best person to approach said customer and request payment. Maintaining healthy cash flow should be an organization-wide effort that starts at the very top. Cash flow management and maintaining cash flow should be a regular discussion at the C-Suite, where clear accountabilities should be set. It’s also important to define what key performance indicators (KPIs) to track and monitor across the entire organization. Then, devise a plan to help achieve targets and maintain excellent cash flow. *There are 10 essential financial performance metrics that every business should track. We've included all 10 of these vital KPIs and their calculation formulas in this handy* [*infographic*](https://www.financealliance.io/infographic-financial-performance-metrics/)*.* [Infographic: 10 financial performance metrics & calculationsWith so many different metrics to track for your financial performance analysis, we thought we’d lend you a helping hand with this useful infographic featuring 10 financial performance metrics (and their calculations) to help you monitor and assess the financial health of your organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/10-financial-perfornance-metrics-infographic.jpg)](https://www.financealliance.io/infographic-financial-performance-metrics/) ### **7\. Budget and cut expenses** Review your company’s spending habits often. You’d be surprised at just how quickly business expenses can pile up. Focus on how much the company spends on areas such as energy bills, travel, technical systems, software, and even paper and printing, etc. Relying heavily on company credit cards can stir trouble and both small businesses and enterprises alike must be careful where and how they're spending money. When you know how money is being spent, you can start controlling it better. Create a cash flow budget to help the company keep spending within its means and avoid overspending. If cash flow isn’t doing great, look for areas where you can minimize or cut expenses. Are there certain expenses that the business can do without? What can be cut without impacting the business negatively? Identify areas where the company can reduce its spending, create a budget, and stick to it. ### **Key takeaways** 1\. Prioritize building a cash reserve to fall back on in times of need. 2\. Leverage technology where possible to help streamline cash flow management strategies. 3\. Establish a line of credit for your company while it's booming, not when it’s in the middle of a financial crisis. 4\. Keep a close eye on the company’s balance sheet for missed payments and opportunities to increase cash flow. 5\. Strive to build a strong cash culture within the company that interconnects and weaves throughout the organization via its people, structure, and processes. 6\. Identify relevant KPIs to help improve cash flow management, and make sure everyone in the company is aware of what they are, why they’re important, and how to improve them. 7\. Find areas where the company can reduce its spending, cut expenses where possible, create a budget, and stick to it! --- **Want to continue this conversation with other CFOs and finance professionals?** **Sign up for our** [**Finance Alliance Slack community**](https://www.financealliance.io/community/) **(it's free!).** [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### 5 ways to rethink your OPEX and reduce cash burn URL: https://www.financealliance.io/5-ways-to-rethink-your-opex-and-reduce-cash-burn/ Last updated: 2025-04-05T07:44:18.000Z With the current economy entering a stage of uncertainty, startups are faced with two potential outcomes - sink or swim. While a recession is looming, the best thing founders can do is to buckle down and prepare for what lies ahead. So how can a startup founder stay agile and prepare for an unpredictable future? By reducing their cash burn rate and extending their runway. The burn rate is the rate at which a new startup is spending its VC funding to finance overhead before generating a positive cash flow. The cash runway is the amount of time a business has until they run out of its cash reserves. One of the best ways for a company to execute both of these initiatives is to rethink its operating expenses (OPEX). Operating expenses are the ongoing costs a company incurs through normal business operations. **Operating costs include the following:** - Rent - Payroll - Utilities - Insurance - Maintenance and repairs - Property taxes - Travel - Office supplies - Advertising & promotion - Any overhead cost ## How to cut down on operational expenses Trimming OPEX is especially important during an economic downturn, as startups need as much cash runway as possible to stay afloat. According to[ CB Insights](https://www.cbinsights.com/research/days-between-funding-rounds/), a startup should have a runway of 18 to 24 months. By reducing operational costs, companies can shave away unnecessary spending, reallocate money where needed, and ultimately improve their overall budgeting processes. In this article, we're going to cover the top five ways to reduce operating costs so your organization can extend its runway and allocate budget to more strategic business initiatives that support a positive ROI. **The five points we'll be covering include:** - Conduct variance analysis - Cut down on sales & marketing spend - Reconsider headcount spending - Cut down on non-essential spending - Renegotiate with vendors [3 important things to know about financial performance analysisEven if you’re experienced at it, there are a few important things about measuring a company’s financial performance that even the experts can overlook. In this blog post, we’re digging into three things every CFO should know about financial performance analysis.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/finanical-performance-analysis-header-image.jpg)](https://www.financealliance.io/3-important-things-about-financial-performance-analysis/) ### Conduct budget variance analysis Budget variance analysis is a critical component of corporate performance management and is widely used across all finance teams. Variance analysis is comparing actuals to the budget values of a given time period and analyzing the differences. Once you're able to take a pulse on your company’s performance through budget variance analysis, you can then start eliminating unnecessary spending and create a cost reduction strategy. After you’ve run the numbers, discuss with your team to see which tools and resources they *actually* need. From there, move on to your suppliers to see which ones contribute to your company’s ROI. If they're not adding value or serving an essential function within your team, it’s time to cut them. To help you get started, make a list of operational essentials vs. nice-to-haves and start eliminating the additional expenses that do not contribute to revenue. By eliminating these low-hanging fruit, you can improve your company's overall operational efficiency and maximize profit margins.‍ ### Cut down on sales & marketing spend Sales and marketing contribute to some of the highest operational expenses in a company. While we don’t suggest completely removing sales and marketing from the equation, you can still reduce spend and invest those resources elsewhere. Ask yourself, “What marketing and sales initiatives are actually driving ROI?” Then, take a moment to think about your company’s ad spend. LinkedIn and Google ads can cost thousands of dollars each month. If it is driving a steady stream of inbound leads, then it may be a worthy investment. However, if your leads are slowly trickling in, it may be time to reduce the budget and allocate it to other projects. When reviewing spend for sales and marketing, analyze activity to see which channels are performing the best and focus budget on those initiatives. By prioritizing the most impactful activities, your team will be able to cut down on the nice-to-haves and reduce spend on projects that won’t move the needle in the short or medium term. Consider re-forecasting your budget so your sales and marketing teams are working as efficiently as possible.‍ [Why CFOs need to embrace financial data managementWith financial data management (FDM) tools evolving rapidly, CFOs are seeing a vast improvement in everything from corporate-level forecasting to streamlined reporting. In this article, we explore why financial data management is still a top priority for CFOs and how it works.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Finanical-data-management.jpg)](https://www.financealliance.io/why-cfos-need-financial-data-management/) ### Reconsider headcount spending A company’s number one expense is its people. While it may seem difficult to cut headcount spending costs, you may want to consider a hiring freeze or refrain from replacing employees that leave from natural attrition to control your spend. These efforts can help improve operational efficiency and cut down on OPEX. When it comes to the overhead cost associated with headcount planning, reconsider your company’s employee rewards structure. This can include how often the company offers salary increases, setting a cap on the percentage someone can receive during a salary increase, offering equity instead of higher pay, and considering other non-essential perks that are given to employees. While this may not be ideal, it is still a better option compared to letting people go.‍ ### Cut down on non-essential overhead expenses Have you ever considered cutting back expenses related to your office space? In today’s post-COVID world, many companies are moving towards a more remote or hybrid model, which is a good opportunity to cut back on overhead costs while also offering more flexibility to their employees. Shifting to a work-from-home or hybrid work model is an effective way for founders to save money. From office supplies to energy consumption, these additional costs add up and can make a great impact on your company’s overall savings. To support this point, it's also a good idea to eliminate non-essential business travel. Now that teams have the resources to work remotely through video conferencing platforms and multiple collaboration tools, business travel is an operational cost that can easily be cut from the equation. [How to use strategic scenario planning for your businessReducing risk and building awareness of what could happen can help you prepare for almost anything. But how does strategic scenario planning work? And how can finance teams use it to future-proof the business? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/firmbee-com-jrh5lAq-mIs-unsplash-2.jpg)](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) ### Renegotiate with vendors If you choose to stay in an office space, consider renegotiating with your landlord to see if they will give you better payment terms if you commit to longer contract terms. You also want to be strategic with the tools that make up your tech stack. While software may have an initial upfront cost, it can save the company a considerable amount of money in the long run. Try to consolidate the different platforms you use and only pay for the ones that are the most essential. Once you have a list of your most critical tools, Talk with your vendors to see if you can switch to a more basic plan and only pay for the features you absolutely need. If any of your vendors are unwilling to work with you, consider switching to a more affordable vendor or office space. ### Managing cash flows Having a hold of your finances is the best way to manage a company’s cash flow. By forecasting regularly and following a cost reduction strategy, you'll be able to course-correct as needed to slow down cash burn. **For more advice and insights about financial operations, check out our** [**library of articles on the topic right here**](https://www.financealliance.io/tag/financial-operations/)**.** --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### How to evaluate the financial performance of a company URL: https://www.financealliance.io/3-important-things-about-financial-performance-analysis/ Last updated: 2024-06-20T10:58:19.000Z Want to know how to evaluate the financial performance of a company? Even if you're experienced, there are a few important things about measuring financial performance that even the experts can overlook. In this blog post, we’re digging into three things every CFO should know about financial performance analysis. **Table of contents:** - [What is financial performance analysis?](https://www.financealliance.io/p/86a25e3e-b3a9-45d3-8284-230daf96d4ad/#what-is-financial-performance-analysis) - [Five must-have documents to evaluate financial performance](https://www.financealliance.io/p/86a25e3e-b3a9-45d3-8284-230daf96d4ad/#1-five-must-have-documents-to-perform-financial-performance-analysis) - [10 important financial performance metrics to monitor and assess ](https://www.financealliance.io/p/86a25e3e-b3a9-45d3-8284-230daf96d4ad/#2-10-important-financial-performance-metrics-to-monitor-and-assess) - [Four areas that are the best measure of a company’s financial health](https://www.financealliance.io/p/86a25e3e-b3a9-45d3-8284-230daf96d4ad/#3-four-areas-that-are-the-best-measure-of-a-company%E2%80%99s-financial-health) ## What is financial performance analysis? Financial performance analysis is an evaluation of a company’s financial standing. It considers a range of categories such as assets, equity, expenses, liabilities, revenue, and profitability. The evaluation usually reviews the financial standing of the company over a specific time period. To evaluate the financial performance analysis of a company properly, you’ll need a deep understanding of the following: \- The overall structure of financial statements: You need to know how they work and what each part of the statement means. \- Potential areas of concern to help mitigate risk and prepare for a more profitable future for the company. \- How the company works and the entire industry the company operates in. This means always being on the pulse of your industry’s latest trends. You should also try to keep up with competitors or better yet, stay one step ahead of them. When done right, financial performance analysis can help organizations make better decisions that lead to business growth and profitability. [How to use strategic scenario planning for your businessReducing risk and building awareness of what could happen can help you prepare for almost anything. But how does strategic scenario planning work? And how can finance teams use it to future-proof the business? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/firmbee-com-jrh5lAq-mIs-unsplash-2.jpg)](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) Alright, that’s enough small talk. Let’s get into the three things every CFO must know about performing a financial performance analysis: ## 1\. Five must-have documents to perform financial performance analysis First up, let’s talk about paperwork… *sort of.* When analyzing financial performance, you need a handful of important documents that may or may not be actual hard copies. Most businesses are embracing the whole ‘digital transformation’ era lately. So, there’s a good chance all the documents you need will be stored in your company’s online filing system. Therefore, the first step is to *find* them. Here are some of the documents you’ll need to carry out a financial performance analysis: **Balance sheet** – this handy document reveals how the company is performing financially on a macro-level. **Income statement** – you’ll need this to track company expenses. Consider things like sales revenue, gross profit, cost of goods sold, and so on. **Cash flow statement** – you can’t calculate a company’s liquidity without the cash flow statement. Well, you probably could, but it’ll take you a very long time. So, get your hands on the cash flow statement and use it to track net income, receivables, and debt. **Profit and loss (P&L) statement** – the P&L statement gives you insights that can be used to check and balance other documentation. **General ledger** – okay, this one isn’t 100% necessary. However, it's useful because you can use it to pinpoint the causes of any discrepancies. [How to create a financial forecast model: A simple guide for finance teamsFinancial forecasting predicts the future performance of the business. But how can you build a financial forecast model from the ground up? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/financial-forecast-model.jpg)](https://www.financealliance.io/podcast/financial-forecast-model/) ## 2\. 10 important financial performance metrics to monitor and assess Here are 10 essential metrics to analyze the financial performance of a company: ### 1\. Gross profit margin Gross profit margin measures the percentage of revenue after subtracting the cost of goods sold. Keep in mind that the cost of goods sold doesn’t include things like operating expenses or taxes. Rather, the gross profit margin is a profitability measure. ![Financial performance analysis metric 1 - Gross profit margin](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Financial-performance-analysis---gross-profit-margin.jpg) ### 2\. Net profit margin Net profit margin measures profitability and is calculated by finding the profit as a percentage of the revenue. It’s not to be confused with gross profit margin. Net profit margin is a measure of profitability for the overall business and takes other expenses into account. ![Financial performance analysis metric 2 - Net profit margin](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Financial-performance-analysis---net-profit-margin.jpg) ### 3\. Working capital Working capital is used to assess a company’s available operating liquidity. This amount can be used to fund things like the daily operations of the business. It's calculated by subtracting current liabilities from current assets. ![Financial performance analysis metric 3 - Working capital](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Financial-performance-analysis---working-capital.jpg) ### 4\. Current ratio Current ratio refers to the liquidity ratio. It's used to assess whether a business has enough current assets to pay for its current liabilities. ![Financial performance analysis metric 4 - Current ratio](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Financial-performance-analysis---current-ratio.jpg) ### 5\. Quick ratio Otherwise known as an acid test ratio, the quick ratio is a liquidity ratio. It calculates a company’s ability to deal with short-term obligations. It focuses on highly liquid current assets, including cash, marketable securities, and accounts receivables. ![Financial performance analysis metric 5 - Quick ratio](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Financial-performance-analysis----quick-ratio.jpg) ### 6\. Leverage Leverage calculates the amount of debt used to buy assets. It’s an equity multiplier and will increase as more debt is used to buy assets. ![Financial performance analysis metric 6 - Leverage](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Financial-performance-analysis---leverage.jpg) ### 7\. Return on equity Return on equity evaluates the equity effectiveness, which indicates how much profit investors will subsequently earn. A higher return on equity is a good sign. It indicates that investors earn more at an efficient rate. In turn, this makes the entire business more profitable. ![Financial performance analysis metric 7 - Return on equity](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Financial-performance-analysis---return-on-equity.jpg) ### 8\. Return on assets Return on assets reveals how effectively a company’s assets are being employed to generate more profit. A low return on assets is a clear indication that the company’s assets aren’t being used effectively. ![Financial performance analysis metric 8 - Return on assets](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Financial-performance-analysis---return-on-assets.jpg) ### 9\. Inventory turnover Inventory turnover is an efficiency ratio measuring how often a company sells its complete inventory per accounting period. ![Financial performance analysis metric 9 - Inventory turnover](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/Financial-performance-analysis---inventory-turnover.jpg) ### 10\. Operating cash flow Operating cash flow measures how much cash the business has as a direct result of business operations. You’ll find operating cash flow in the cash flow statement. ![Financial performance analysis metric 10 - Operating cash flow](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/FA-Infographics_10_Metric_Formulas_of_Financial_Performance_10.jpg) Want to have a look at all of these financial performance metrics in one place? Check out our infographic -[ *10 financial performance metrics & calculations*](https://www.financealliance.io/infographic-financial-performance-metrics/)*.* [Infographic: 10 financial performance metrics & calculationsWith so many different metrics to track for your financial performance analysis, we thought we’d lend you a helping hand with this useful infographic featuring 10 financial performance metrics (and their calculations) to help you monitor and assess the financial health of your organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/10-financial-perfornance-metrics-infographic.jpg)](https://www.financealliance.io/infographic-financial-performance-metrics/) ## 3\. Four areas that are the best measure of a company’s financial health There’s no ultimate way to evaluate the financial performance of a company. How one company assesses financial health can be completely different from how another company does it. However, there are a few vital areas of financial well-being that you should assess in combination with each other. These four things are: - Liquidity - Solvency - Profitability - Operating efficiency Now, let’s explore each one in more detail and find out why they’re so important: ### Liquidity Liquidity refers to a company’s ability to raise cash when necessary. What determines a company’s liquidity position is its ability to convert assets to cash. If a company can do this, it’s a sign that it can pay its current liabilities. If a company can’t survive in the short term, it’s not going to last very long. ### Solvency Can the company meet its debt obligations long-term? Solvency is key when measuring the financial health of any organization. When you’re carrying out financial performance analysis, always check the company’s solvency performance. Find out if the company can meet long-term financial obligations and debts. ### Profitability All companies need to be profitable to be successful. Sure, start-ups can rely on investors and creditors to carry them through the dark ages of starting a new business. But, if a company is to survive long-term, it must be profitable. A company’s bottom line is vital to the overall financial performance and health of the company. The best metric to calculate a company’s net profitability is the net margin. ### Operating efficiency How efficient is your organization? Operating efficiency is a key metric to track in your financial performance analysis. It reveals how efficiently a company’s operations run and how well management controls costs. [FP&A: What is financial planning and analysis?What does FP&A stand for? In this post, we’re covering the basics of financial planning and analysis!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/What-is-FP-A--2.jpg)](https://www.financealliance.io/what-is-financial-planning-and-analysis/) ### Key takeaways for a successful financial performance analysis 1\. Financial performance analysis evaluates a company’s financial standing. It helps organizations make informed decisions that lead to business growth and profitability. 2\. When analyzing financial performance, you’ll need these five documents: - Balance sheet - Income statement - Cash flow statement - Profit and loss statement - General ledger 3\. Compare financial metrics historically, and against your industry, to help gain valuable insights into your company’s financial performance. 4\. When carrying out financial performance analysis, make sure that you consider the company’s liquidity, solvency, profitability, and operating efficiency. **Want more great FP&A content?** [**Check out more of our articles and resources here.**](https://www.financealliance.io/tag/fp-a/) --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### Infographic: 10 financial performance metrics & calculations URL: https://www.financealliance.io/infographic-financial-performance-metrics/ Last updated: 2022-09-02T11:18:20.000Z Knowing what financial performance metrics to use to evaluate the overall financial health of a business is so important. Relying on your gut instinct isn’t always guaranteed to work, which is why you need to analyze data to back up your assumptions. But what financial performance metrics and KPIs should you use to measure performance? And, what calculations are used to measure financial performance metrics? With so many different metrics to track for your financial performance analysis, we thought we’d lend you a helping hand with this useful infographic featuring 10 financial performance metrics (and their calculations) to help you monitor and assess the financial health of your organization: ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/09/10-metrics-for-finance-performance.jpg) **Want more great FP&A content? [Check out more of our articles and resources here.](https://www.financealliance.io/tag/fp-a/)** --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### 5 ways CFOs can support the CEO URL: https://www.financealliance.io/5-ways-cfos-can-support-the-ceo/ Last updated: 2024-06-20T11:22:33.000Z Never underestimate the power of an effective partnership between a Chief Financial Officer (CFO) and Chief Executive Officer (CEO). The CEO and CFO relationship is arguably the most important relationship in any business. Together, the two can navigate through times of transition and lead an organization to greatness. Of course… all that ‘greatness’ depends on the relationship between the CFO and CEO. If they clash heads and can’t see eye-to-eye, it won’t take long before things start falling apart at the seams. But, if the CEO and CFO relationship is a strong one, built on trust and collaboration, it’ll have a positive impact on the entire business. If you’re a CFO determined to foster a strong relationship with the CEO of your company, you’ve come to the right place. In this post, you’ll learn what a CEO needs from their CFO, and what you can do to support the CEO on a day-to-day basis. Topics covered: - [Why the CEO and CFO relationship is important](https://www.financealliance.io/p/ad8fc6b1-613d-47d9-8cb2-796b6579e41b/#why-the-ceo-and-cfo-relationship-is-so-important) - [How to build a strong CFO and CEO relationship](https://www.financealliance.io/p/ad8fc6b1-613d-47d9-8cb2-796b6579e41b/#how-to-build-a-strong-cfo-and-ceo-relationship) - [Building a foundation of trust](https://www.financealliance.io/p/ad8fc6b1-613d-47d9-8cb2-796b6579e41b/#1-build-a-foundation-of-trust-between-the-cfo-and-ceo) - [Open and honest communication](https://www.financealliance.io/p/ad8fc6b1-613d-47d9-8cb2-796b6579e41b/#2-strive-for-open-and-honest-communication-between-the-cfo-and-ceo) - [Knowing the business like the back of your hand](https://www.financealliance.io/p/ad8fc6b1-613d-47d9-8cb2-796b6579e41b/#3-know-the-business-inside-and-out) - [Challenging the business and driving positive change](https://www.financealliance.io/p/ad8fc6b1-613d-47d9-8cb2-796b6579e41b/#4-challenge-the-status-quo-and-drive-positive-change) - [Becoming a business partner](https://www.financealliance.io/p/ad8fc6b1-613d-47d9-8cb2-796b6579e41b/#5-become-an-effective-business-partner) ## **Why the CEO and CFO relationship is so important** All the best businesses in the world have a strong CEO and CFO relationship. Without it, a company is more likely to struggle to meet goals from every corner of the business. Every successful company needs a leadership union with a solid and cohesive vision. According to [Gartner](https://www.gartner.com/en/finance/trends/cfo-influence-ceo), **80% of CFOs have strong relationships with the CEO**. The modern-day CFO is so much more than the financial gatekeeper. They are the CEO’s right-hand person. The CFO must support and challenge the CEO to make the best possible choices for business growth. But why is the CEO and CFO relationship so important? Well, studies have shown that the CEO and CFO working relationship has a direct impact on the success of a company. When CEOs and CFOs work well together, they harness each other’s strengths to make better-informed business decisions. The CFO comes from a financial background and although the CFO reports to the CEO, that doesn't mean they both share the same level of financial understanding. So, the CFO often has to think about how they're communicating information to the CEO. They must present data in a way that's easy to understand for someone who *isn't* a financial expert. Doing so will help give the CEO all the information they need to, again, make better decisions, and reach the best possible outcome for the business. Making the CEO aware of potential risks and what needs to be done to cut those risks is vital. Building a strong CEO and CFO relationship is crucial to keeping that line of communication, trust, and collaboration open. [Why CFOs need to embrace financial data managementWith financial data management (FDM) tools evolving rapidly, CFOs are seeing a vast improvement in everything from corporate-level forecasting to streamlined reporting. In this article, we explore why financial data management is still a top priority for CFOs and how it works.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Finanical-data-management.jpg)](https://www.financealliance.io/why-cfos-need-financial-data-management/) ## **How to build a strong CFO and CEO relationship** The CFO role has transitioned into a business partnership role, which means the CFO and CEO are working closer together than ever. One of the most important aspects of the CFO role is to build a trusted and effective partnership with the CEO, but how? What do CEOs want from their CFOs? Here are five ways CFOs can support the CEO: ### **1\. Build a foundation of trust between the CFO and CEO** [98% of CFOs](https://www.russellreynolds.com/en/insights/reports-surveys/leadership-squared) with “very strong” CEO relationships say they're comfortable bringing difficult issues to their CEOs. Without trust, you'll have a hard time building a solid relationship with the CEO... and anybody else for that matter. CEOs must trust their CFO with extremely important and often highly confidential information. The two must be able to express their opinions openly and talk about company issues with mutual trust and respect. But the CEO can’t hand their trust to the CFO just because of their job title. The CFO must *earn* the CEO’s trust and the best way to do that is to start with an open and honest dialogue. Speak candidly about the business when you must. And show that you're knowledgeable about the business and its financial standing. ![TRUST - how to support the ceo](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/CFO-and-CEO-relationship-trust.jpg) The CEO trusts the CFO to help make crucial business decisions. If the CEO can’t trust you as their CFO, you have a big problem on your hands. Below, you’ll find some tips to help build a foundation of trust between the CEO and CFO: **Always be honest and upfront** Humans make mistakes and that's normal, *expected* even. But, you’ll lose the CEO’s trust if you keep making mistakes that keep negatively impacting the business. Mistakes happen and sometimes there’s nothing you can do to prevent them. But when they *do* happen, own up to your mistake and take responsibility for it. Don’t try to hide it from the CEO, that'll only do more harm than good. If you make the CEO aware of your mistake, you can take the right steps to solve the issue and prevent it from happening again. **Be prepared and over-deliver on your promises** You can safely assume that your CEO has a lot on their plate. After all, they’re leading the entire organization. So, they’re counting on you to prepare for meetings and presentations. They want to be confident that their CFO can answer any question that comes their way and do so with confidence. If you show up prepared and over-deliver on your promises, you’ll prove that you’re someone the CEO can trust. **Be a good person** Don’t underestimate the impact of simply being a genuine person. If your intentions aren’t in the right place, people know it. Never get sucked into the gossiping vortex at work. Keep your opinions about others to yourself. And always treat people with kindness and respect. Remember that you and the CEO will often discuss sensitive matters. You're trusted to keep that information confidential. So, avoid gossiping around the water cooler and keep it inside the ‘circle of trust.’ [Top 10 must-have CFO skills to be really successfulThe modern CFO wears multiple hats and must master a variety of skills. But what skills does the CFO of the future need to stay on top? Here are the top 10 skill sets for CFOs of tomorrow.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/arrow-gb0e6f39dd_1920.jpg)](https://www.financealliance.io/top-10-cfo-skills/) ### **2\. Strive for open and honest communication between the CFO and CEO** The best CFOs are effective communicators. CEOs want their CFOs to communicate openly and honestly with them. So, if you’re not the best at communicating ideas, problems, solutions, etc., start practicing. The CEO needs to trust that their CFO knows how to not only deliver data but communicate it in a way that they (and other stakeholders without finance backgrounds) can understand. With the role of the CFO constantly evolving, communication skills have climbed to the top of must-have CFO skills. The CFO and CEO must be able to speak openly to each other about everything from budgets to strategy and important business decisions. Effective communication between the two roles is crucial. [89% of executives](https://www.russellreynolds.com/en/insights/reports-surveys/leadership-squared) said the leadership trait they valued most was honesty. This means being always upfront and transparent with your CEO. Don’t keep secrets from them. Communicate complex issues in simple terms where possible. And always strive for open and honest dialogue. ### **3\. Know the business inside and out** CFOs need to develop a good understanding of the business and the strategy. You’ve got to know how the business works across each department. Learn where the CEO sees the business going, and how they plan to get there. Aside from handling the data and finance side of the business, CEOs expect their CFOs to know how different departments operate. And, how all their strategies tie into overall business goals. The best way to get to know the business is to build strong relationships with other members of the team. Take time to get to know who you work with. Learn about their growth strategies. Find out if they have any obstacles getting in the way of their goals. And, offer solutions for any rising issues when you can. Getting to know the business, the people, and the strategy, is vital to identify the company's strengths, challenges, and any gaps. Here are a few key areas of the business to familiarise yourself with: **\- The company’s goals and aspirations** – What does the company want to achieve? **\- What products or services does the company offer?** \- Clarify the purpose of those products/services and get to know the marketplace for each one. **\- Competitors -** How can the company gain a competitive advantage? And what can sustain that advantage long-term? How can the company differentiate itself from its competitors? **\- Existing systems and processes -** What is in place now? What needs to be replaced with better systems or processes? Are there other options that’ll help streamline processes, cut costs, and increase productivity? Armed with this knowledge, you’ll be in a much stronger place when brainstorming possible solutions and growth strategies with the CEO and other members of the C-Suite. [Can a CFO be a CEO?Do you have what it takes to be a CEO? The CFO role has evolved from a financial steward and architect to a strategic business advisor to the CEO and the C-Suite...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTjendra Halima![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/can-a-cfo-be-ceo.png)](https://www.financealliance.io/can-a-cfo-be-a-ceo/) ### **4\. Challenge the status quo and drive positive change** The CEO doesn’t expect their CFO to enter the business and blindly accept the status quo. CEOs want their CFOs to voice their opinions and challenge the business to push towards a more profitable future. For example, if the numbers don't support an existing strategy, see if you can offer alternative solutions to drive positive change. Speaking of change, the CFO is often the one leading finance transformation within an organization. Adopting new technologies to streamline processes and increase workplace productivity is just one area of the business where the CFO can drive positive change. The CFO is responsible for looking ahead and seeking opportunities to improve the bottom line. With automation and technology always evolving, CFOs must prepare to install such technologies and develop an effective change management strategy in the process. Of course, not all changes are huge distributors of the status quo. Some changes are improvements to the current state of a company’s systems and processes, as noted by [McKinsey](https://www.mckinsey.com/~/media/McKinsey/Business%20Functions/Strategy%20and%20Corporate%20Finance/Our%20Insights/Strategy%20and%20corporate%20finance%20special%20collection/Final%20PDFs/McKinsey-Special-Collections%5FRoleoftheCFO.ashx): > *“Although some transformations include radical changes, most create significant improvements on the margin of existing operations.”* For a CFO to drive real change, they must develop a good partnership with the CEO. Identify what areas of the business need to change. Diagnose sources of resistance. And, work together to come up with the best solutions to overcome obstacles and achieve positive change. ### **5\. Become an effective business partner** Demands on finance teams are increasing. CEOs need more than a C-Suite member who's good with numbers. They need their CFOs to be strategic business partners and help them make strategic business decisions. As the CFO, you’ll partner with both the CEO and other senior executives/executive assistants. Maximizing business performance will be at the very top of your priorities. And the CEO will be assessing your capabilities as a strategic business partner. So, how can you convince the CEO that you’re more than capable of stepping up to the challenge? Here are a few tips to help you step into the role of a strategic business partner and continue building a strong CFO and CEO relationship. **Automate mundane tasks** If you want to focus more on strategy and less on numbers, look for ways to automate mundane and repetitive tasks that don’t take a lot of thought or… human interaction. More CFOs are leveraging technology to automate time-consuming tasks and for good reason. Automating and delegating tasks will help free up your time so you can focus on more important things. **Focus on strategic planning** The role of a finance business partner involves embracing strategic planning. The CFO and CEO spend a lot of time strategizing for growth and a huge part of that relies on the CFOs ability to strategically plan. This involves forecasting potential risks, asking critical questions, and coming up with plans to help mitigate as much risk as possible. **Develop strong leadership skills** The CFO leads the finance team and therefore must become great leaders themselves. Being a key and valuable member of the C-Suite also means the CFO must build solid relationships with not just the CEO, but other members of senior management. ### Key takeaways: 1\. Build a foundation of trust 2\. Aim for open and honest communication 3\. Get to know the business like the back of your hand 4\. Don’t be afraid to challenge the status quo and drive change 5\. Take steps to become a strategic business partner --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### Scenario planning: Strategic forecasting for finance teams URL: https://www.financealliance.io/scenario-planning-strategic-forecasting-for-finance-teams/ Last updated: 2022-08-26T12:07:41.000Z In a perfect world, it’s easy to plan for the best-case scenario. However, we are living in unprecedented times, and the best-case scenario is rarely the reality. Roadblocks arise, industry trends shift, or unexpected opportunities catapult a business forward. What happens if your business doesn’t hit revenue targets? What if it receives a round of funding? Or what if another global pandemic strikes? Businesses are expected to know how to navigate these uncharted waters. However, that can only be done through proper preparation. Does your company have a best-case scenario mentality or are they planning for reality? As we have all learned from the past few years, planning for the unexpected is the new normal. By preparing for the future, organizations will better be able to course-correct as needed. While companies cannot predict what’s to come, they can still plan for the unexpected. This can be done through strategic scenario planning. In this article, we're diving into the ins and outs of the different types of scenario planning so your team can continue to grow and excel no matter what the future holds. ## What Is Scenario Planning? Scenario planning is the process of making assumptions about the future and predicting how your business will be affected. By preparing for what *could* happen, you will better be able to react and respond to forthcoming obstacles. This process gives organizations the power to go from reactive to proactive in their strategic planning initiatives. Simply put, scenario planning allows organizations to plan for the future with multiple outcomes. For an organization to achieve this level of preparation, it must be able to identify the potential circumstances and their corresponding outcomes. These circumstances can be both positive and negative or lead to a variety of responses. However, the main purpose is to better prepare business leaders of an organization to make the right decisions to continue to support an organization’s growth. [Why CFOs need to embrace financial data managementWith financial data management (FDM) tools evolving rapidly, CFOs are seeing a vast improvement in everything from corporate-level forecasting to streamlined reporting. In this article, we explore why financial data management is still a top priority for CFOs and how it works.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Finanical-data-management.jpg)](https://www.financealliance.io/why-cfos-need-financial-data-management/) ## How Does Scenario Planning Work? As the name suggests, scenario planning is all about outlining different business scenarios and uncovering an organization’s possible responses. By raising awareness of the plausible scenarios, leaders are better able to react as needed. There are four basic steps when it comes to the scenario planning development process. These steps include: - Identify the main drivers - Identify critical uncertainties - Develop possible scenarios - Discuss potential pathways forward Once these steps have been completed, senior management can brainstorm together to discuss how their organization may change or evolve in the future. This kind of strategic thinking allows finance teams to quickly adapt and identify the potential impact of any potential scenario. ## Why Is Scenario Planning Important? We know that practicing scenario planning allows leaders to stay agile in an ever-evolving environment. However, what are the other advantages that come with a scenario plan? Finance teams that prepare for different scenarios are more likely to have a competitive advantage. Let’s take a moment to think about what happened during COVID-19\. No one could expect that our economy would swing to a sudden halt. That's a scenario that companies would have never seen coming. However, the organizations that quickly adapted to this massive shift were the ones that were able to survive. Aside from mitigating risks and improving agility, scenario planning also allows senior management to make more strategic decisions for their organization. By having a clear scenario planning framework, leaders within an organization have greater insight when it comes time to create their financial forecasts. [How to use strategic scenario planning for your businessReducing risk and building awareness of what could happen can help you prepare for almost anything. But how does strategic scenario planning work? And how can finance teams use it to future-proof the business? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/firmbee-com-jrh5lAq-mIs-unsplash-2.jpg)](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) ## What Are the Different Types of Scenario Planning? Finance teams have several methods of putting this principle into practice. The fundamental types of scenario planning include: - Quantitative scenarios - Operational scenarios - Normative scenarios - Strategic management scenarios ### Quantitative Scenarios Quantitative scenarios include best-case and worst-case scenario planning model outputs. When it comes to this type of scenario plan, finance teams are able to quickly adapt models by changing minimal factors. By assuming key variables and corresponding relationships, finance teams can easily create financial forecasts and budgets as needed. ### Operational Scenarios Operational scenarios, or event-based scenario planning, are some of the most widely used scenario planning models used by finance teams today. This model reviews the immediate impact of a specific event and how an organization will respond to it. ### Normative Scenarios Normative scenarios, also known as prescriptive scenarios, are used to predict a company’s most desired outcome. Normative scenarios help an organization shine light on how it would like its business to operate in the future. Once it has a clear vision of its end goal, it can then work backward to identify the pathway to get there. ### Strategic Management Scenarios Instead of focusing on the actual company, strategic management scenarios strive to paint a picture of the overall environment in which the organization operates. When it comes to this type of scenario planning, professionals shift their focus from more minor issues to greater challenges that may affect their organization. [Should you use rolling forecasts? Weighing the pros and consHow efficient is your budget variance analysis process? If there is room for improvement, it may be time to restrategize...![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceDani Thomason![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Rolling-forecasts.png)](https://www.financealliance.io/should-you-use-rolling-forecasts-weighing-the-pros-and-cons/) ## How to Turn Scenarios Into Strategy So now that you know what strategic scenario analysis is, it's time to bring these ideas to life. When you first start implementing a scenario planning strategy, keep it simple. One of the biggest mistakes finance teams make when conducting scenario modeling is overcomplicating the process. Of course, there are endless scenarios that could play out. Instead, focus on the most relevant or realistic cases that would apply to your specific organization. By focusing on two to three different scenarios, your team will better be able to prepare for these specific cases during the planning process. When fleshing out the alternative scenarios, include the different stages for each outcome. Have a clear idea of the average case, best case, and worst-case scenario. Not only will this provide greater insight into the plausible scenarios, but it also provides a more consistent framework for future planning. ## How the Finance Function Can Support Scenario Planning In times of uncertainty, companies have no choice but to stay agile. When building models and budgets, unexpected circumstances such as economic shifts, emerging opportunities, or even global pandemics can arise. In order for organizations to steadily push forward, they must stay on their toes and adjust as needed. By having more strategic foresight when conducting financial forecasting and planning, teams can reduce risks and align on organizational objectives. In addition, by following best practices and implementing the right tools, financial analysts can use scenario planning to drive valuable insights and be more strategic in their everyday work. To equip your team with the right resources, you need to go with a strategic finance solution that supports quick scenario analysis and can uncover the potential impact of any possible outcome. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ‍ ### Why CFOs need to embrace financial data management URL: https://www.financealliance.io/why-cfos-need-financial-data-management/ Last updated: 2025-04-05T07:44:34.000Z With financial data management (FDM) tools evolving rapidly, CFOs are seeing a vast improvement in everything from corporate-level forecasting to streamlined reporting. But what does the future hold for financial data management? Is it still as relevant to the CFO role as it once was? Or are CFOs moving towards a more digital era of managing financial data? In this article, we explore why financial data management is still a top priority for CFOs and how it works. Keep reading to discover the answers to these questions (and more!): - [What is financial data management?](https://www.financealliance.io/p/c29d033f-2cd6-4fc3-9c4f-0b237d30b8d4/#what-is-financial-data-management) - [What’s the difference between financial reports and management reports?](https://www.financealliance.io/p/c29d033f-2cd6-4fc3-9c4f-0b237d30b8d4/#financial-reports-vs-management-reports-key-differences) - [How has financial data management evolved?](https://www.financealliance.io/p/c29d033f-2cd6-4fc3-9c4f-0b237d30b8d4/#how-financial-data-management-has-evolved) - [How are companies leveraging new financial data management technologies?](https://www.financealliance.io/p/c29d033f-2cd6-4fc3-9c4f-0b237d30b8d4/#how-companies-are-leveraging-new-financial-data-management-technologies) - [How does financial data management work?](https://www.financealliance.io/p/c29d033f-2cd6-4fc3-9c4f-0b237d30b8d4/#how-does-financial-data-management-work) - [What are the top data management and analytics trends for CFOs in 2022?](https://www.financealliance.io/p/c29d033f-2cd6-4fc3-9c4f-0b237d30b8d4/#top-financial-data-management-trends-for-cfos-in-2022) ## What is financial data management? [Gartner](https://www.gartner.com/en/finance/glossary/financial-data-management) defines financial data management as a set of processes and policies (often assisted by specialized software) that… > *"...enable an organization to consolidate its financial information, maintain compliance with accounting rules and laws, and produce detailed financial reports.”* **\- Gartner.** The ‘specialized software’ mentioned includes analytics, reporting, predictive modeling, and data visualization tools. Financial data management also ensures the company meets legal requirements and compliance regulations. > *“Financial data management maintains a logic-driven data structure (such as a chart of accounts) to provide different snapshots of financial data.”* **– Gartner.** More than [50% of enterprises](https://www.gartner.com/en/marketing/insights/articles/do-you-need-a-data-management-platform) use a data management platform (DMP). Accurate financial data management is crucial for any organization. But why? Here are four reasons why CFOs should put data management at the top of their list of priorities: 1\. It helps centralize governance and creates more efficient finance operations. 2\. It helps to put effective business transformation initiatives in place. Not just within the finance function, but across the entire company. 3\. It ensures continuous and accurate internal and external reporting. 4\. It provides self-service for finance users while also decreasing dependency on IT. Arguably, the main benefit of financial data management is that it gives you (and the CEO) peace of mind knowing the company aligns with your country's legal requirements. Therefore, your company will be in a much better position with lower financial and legal risks. [How to use strategic scenario planning for your businessReducing risk and building awareness of what could happen can help you prepare for almost anything. But how does strategic scenario planning work? And how can finance teams use it to future-proof the business? Find out here.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/firmbee-com-jrh5lAq-mIs-unsplash-2.jpg)](https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/) ## Financial reports vs management reports: Key differences Financial reports focus on ensuring an organization is always in the good books in the eyes of the law. On the other hand, management reports help managers make better-informed decisions. Although they share some similarities, the two are very different, and you mustn’t get them mixed up. Here are some of the key differences between financial reports and [management reports](https://www.financealliance.io/corporate-performance-management-how-does-it-relate-to-finance/): ### 1\. Different audiences Financial reports are intended for external stakeholders such as suppliers, creditors, investors, and bankers. Management reports are usually for internal stakeholders such as managers. ### 2\. One is optional, the other is compulsory While financial reports are a vital part of financial data management and mandatory for legal purposes, management reports are optional. Yes, they provide insights to help a business grow, but they’re not compulsory. ### 3\. Time frame differences A [financial report](https://www.financealliance.io/digital-reporting-shortcut/) aims to showcase the performance of a business during a set time. Management reports are more flexible. They can work for whatever department or purpose you want to monitor. However, financial reports are evolving from being quite rigid with a timescale to a more flexible approach that provides insights in real time. ### 4\. Past vs future Finally, financial reports focus on the past performance of the business. Management reports make *future* predictions. [Are you prepared for ESG and sustainable finance?What is sustainable finance? And how can CFOs help their organization prepare for ESG and sustainable finance? In this blog post, we dive into the true meaning of sustainable finance and ESG.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/What-is-sustainable-finance.jpg)](https://www.financealliance.io/are-you-prepared-for-esg-and-sustainable-finance/) ## How financial data management has evolved Historically, CFOs spent their days building financial reports from scratch. Creating intricate spreadsheets of data was their bread and butter. And, in many ways, it still is. However, with digital transformation at the forefront of many companies’ growth strategies, new technologies have paved the way toward a more data-driven culture. CFOs are no longer solely focused on transactional matters such as managing investor relations and helping to steer the company towards financial growth. Nowadays, CFOs are business pioneers. They are more than just ‘number crunchers’ making sure the company doesn’t fall into a downward spiral of debt. Modern CFOs are business partners. They're often seen as the CEO’s right-hand man or woman, whose expert insights and knowledge are vital to a company’s success. As the role of the CFO continues to evolve, the role of financial data management has grown alongside it. Financial data management supplies stakeholders with data to reach a single source of economic truth. This ‘truth’ is always up-to-date and precise. This results in greater accuracy and real-time insights that help organizations make better data-driven decisions. Many organizations face a pressing issue: the sheer volume of available data that must be assessed and analyzed. Once upon a time, organizations relied on enterprise resource planning (ERP) systems to collect and analyze data from multiple sources. But ERP systems are often too rigid and limited to handle the problem effectively. To get a handle on data, organizations began leveraging new technologies that could swiftly handle what [Deloitte](https://www2.deloitte.com/content/dam/Deloitte/ie/Documents/Consulting/Crunchtime%20Series%5Fa%20CFO%20Guide%20to%20data%20management%20strategy%5FDeloitte%202020.pdf) names, the ‘data tsunami.’ According to Deloitte, these new technologies help organizations: > *“Strengthen data - management foundations by, for instance, establishing enterprise or finance data lakes, streamlining reporting practices, and cultivating data management and analytics skillsets.”* **– Deloitte** [4 roles every CFO must dominate:The changing role of the CFOTraditionally, the roles of the CFO consisted of the Operator and Steward. But now, those roles have evolved. Discover the 4 roles every CFO must master in this podcast episode and blog post.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO.jpg)](https://www.financealliance.io/podcast/4-roles-every-cfo-must-dominate-changing-role-of-the-cfo/) ## How companies are leveraging new financial data management technologies Advanced financial data management tools and software can help tackle common data challenges, such as: ### Financial planning If you’re tired of manually entering data into spreadsheets every day, seek out software that'll assist with these types of processes. Automated and analytic-based models are proving to be useful for streamlining financial planning. Integrated cloud planning systems are another great option, especially for companies who want to improve their existing financial data management processes because they can address both internal and external data requirements. ### Finance operations Improve entry traceability and audit responsiveness by automating reconciliations and streamlining the workflow of your finance team. Consider creating hierarchies to get a handle on your data when it comes to management, financial, and regulatory reporting. ### Decision support Improve your existing financial data management processes by leveraging big data to make it accessible across the organization. You can also use specific software to clarify information needs across multiple units of the business and build interactive reports that make it easier for users to access many layers of data more efficiently. ![Financial data management graphic - computer screen with tables and graphs](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/financial-data-management-computer-graphic.png) ## How does financial data management work? Maintaining a compliant record of financial information is vital for organizations of all sizes. Not to mention, it’s handy having all that data in one place, ready to be sectioned, printed, or emailed to necessary parties. But how does financial data management work? Let’s look at some of the key steps involved in financial data management: ### Automated data extraction Gone are the days when you had to manually type numbers into spreadsheets for hours each day. With automated technology, you can sit back and relax while the software extracts data for you. Of course, this is assuming you have the technology to do this automatically. Most financial data management systems have pre-built APIs that pull data from financial accounting endpoints. Therefore, you don’t have to chase down other teams across the organization to access essential data. ### Transform financial data management into a story Once you’ve collected the data you need, you must bring it all together to create a transactional story that the CEO and other key stakeholders of the organization can understand. Creating a graph data model is useful for achieving this because it presents the data in a visual way that’s easier to digest. An effective graph model will accurately tell the story of a complete financial transaction – without any errors or gaps. [5 ways CFOs can accomplish finance digital transformationAs the CFO, you’ll lead the charge for finance digital transformation within the organization. But doing so takes some work. Here are 5 ways CFOs can drive finance digital transformation, optimize business processes, and even enhance overall profitability.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/finance-digital-transformation.jpg)](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) ## Top financial data management trends for CFOs in 2022 Streamlining financial data management processes is set to be a top priority for CFOs and finance teams in 2022 and beyond. But what else lies on the horizon? Here are some interesting trends around data management, analytics, and technology in finance (according to [Gartner](https://www.gartner.com/en/articles/4-data-analytics-trends-cfos-can-t-afford-to-ignore)). ### 1\. Data storytelling Dynamic data storytelling is quickly becoming a growing trend in the world of finance. It’s not enough to put data into a spreadsheet and pass it on in hopes everyone will understand. You’ve got to give them the story behind the data. According to Gartner, dynamic data storytelling is replacing traditional predefined dashboards. Not only that, but by 2025, data stories will be the most widespread way of consuming analytics. And augmented analytics techniques will automatically generate 75% of those stories. ### 2\. Augmented financial data management By 2023, augmented data management will be responsible for drastically reducing reliance on financial analysts for repetitive and routine data management tasks. Since finance analysts will likely spend less time on mundane tasks, they’ll free up around 20% of their time for other things such as training, collaboration, and high-value analytics tasks. ### 3\. Pervasive cloud deployment Cloud applications are leading the way for sharing and dispersing enterprise data – including data generated throughout the financial data management process. Gartner predicts that by next year, public cloud services will be essential for 90% of data and analytics innovation. ### 4\. Convergence of financial data management and analytics platforms Another interesting trend reported included data and analytics processes moving towards a singular platform that incorporates multiple capabilities across the data life cycle, from data entry and storage to analysis and AI and ML. > *“By 2023, 95% of Fortune 500 companies will converge analytics governance into broader data and analytics governance initiatives.”* **– Gartner** ### Key takeaways: Financial data management 1\. Financial data management is a set of processes and policies that helps an organization maintain compliance and produce accurate financial reports. 2\. Advanced data management tools and software can help tackle common data challenges related to financial planning, operations, and decision support. 3\. Collecting data is the first step. Once you have that data, you must transform it into a story that the CEO and other key stakeholders of the organization can understand. For example, this can be in the form of a graph or a well-presented table. --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### How to future-proof your business using strategic scenario planning URL: https://www.financealliance.io/how-strategic-scenario-planning-can-help-prepare-your-business-for-anything/ Last updated: 2022-09-16T14:31:46.000Z Wouldn’t it be great if you could predict the outcome of every decision you make? That way, you could take the road of least resistance and avoid making the wrong choices. Unfortunately, predicting the future isn’t possible (as far as we know). But with strategic scenario planning, you can get pretty damn close. Strategic scenario planning means thinking through every business decision carefully. Reducing risk and building awareness of what could happen can help you prepare for almost anything. But how does strategic scenario planning work? And how can finance teams use it to future-proof the business? Let’s find out! In this article, you’ll discover: - [What strategic scenario planning is](https://www.financealliance.io/p/a61ed3c7-87bd-43bb-92cc-3bc0dec4f8ee/#what-is-strategic-scenario-planning) - [The pros of strategic scenario planning](https://www.financealliance.io/p/a61ed3c7-87bd-43bb-92cc-3bc0dec4f8ee/#why-strategic-scenario-planning-is-so-awesome-the-benefits) - [Common challenges of strategic scenario planning](https://www.financealliance.io/p/a61ed3c7-87bd-43bb-92cc-3bc0dec4f8ee/#common-challenges-of-strategic-scenario-planning) - [How to use strategic scenario planning](https://www.financealliance.io/p/a61ed3c7-87bd-43bb-92cc-3bc0dec4f8ee/#how-to-use-strategic-scenario-planning) - [Tips for building a strategic scenario planning strategy](https://www.financealliance.io/p/a61ed3c7-87bd-43bb-92cc-3bc0dec4f8ee/#tips-for-building-a-strategic-scenario-planning-strategy) ## What is strategic scenario planning? Strategic scenario planning investigates the past and present to predict the future. Think of it like researched storytelling with a greater purpose. You use strategic scenario planning to help identify uncertainties and anticipate potential risks. Armed with this knowledge of ‘what if’ scenarios, you can think through and plan for events ahead of time. That way, if any of the events occur, you'll have an action plan ready to deal with the situation and mitigate risk. It's best to keep your scenario action plans on file. So, if a potential scenario begins to play out, your team can react almost immediately and in real-time. [5 surprising advantages of xP&AWhat is xP&A? In this post, we define the meaning of xP&A and share 5 surprising advantages of xP&A that every CFO should be aware of.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/5-facts-about-xp-a.jpg)](https://www.financealliance.io/5-advantages-xp-a/) ### Why strategic scenario planning is so awesome: the benefits Although it can be time-consuming to perform strategic scenario planning for outcomes that may never actually happen, it has its fair share of advantages. Here are some of our favs: - Scenario planning helps executives understand the impact of a variety of potential events. As you can imagine, this makes it a lot easier for you to explain why action plans for such scenarios are necessary. - It can take place at any level of an organization. You can use strategic scenario planning for the entire business or individual projects. - Not sure where or how to allocate limited resources? Scenario planning helps finance teams and senior management divide resources rationally and effectively. - Reducing risk is a huge benefit of strategic scenario planning. It gives you the insight to prepare for a variety of possible outcomes, avoid risk, and ‘fix’ weak spots. ### Common challenges of strategic scenario planning Like most things, strategic scenario planning comes with some [good and bad points](https://www.financealliance.io/should-you-use-rolling-forecasts-weighing-the-pros-and-cons/). Most of the time, the good outweighs the bad. However, you've also got to prepare for some of the difficulties of implementing scenario planning in your business. Here are a few: - It can be expensive. You’ve to make sure your budget allows for the costs and resources that come with scenario planning. - It’s time-consuming and can take some organizations months to complete. A lot of the time is spent collecting and interpreting data from various sources. - How many plausible scenarios should a company plan for? And how far ahead should your company use strategic scenario planning? These are legitimate questions you should answer ahead of time. [FP&A: What is financial planning and analysis?What does FP&A stand for? In this post, we’re covering the basics of financial planning and analysis!![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/06/What-is-FP-A--2.jpg)](https://www.financealliance.io/what-is-financial-planning-and-analysis/) ## How to use strategic scenario planning Designed to build a company’s resilience, strategic scenario planning focuses on identifying future threats, risks, and opportunities. Think of strategic scenario planning as your company’s coat of armor. It helps you make swift decisions, prepare for future uncertainty and shield the business from potential threats. But how can you perform strategic scenario planning and scenario development effectively? Here’s a simplified breakdown of the strategic planning process: ### 1\. Consider future scenarios The first step is like a giant brainstorming session. You’re brainstorming future scenarios that could happen within a specific time frame. For example, if you choose a time frame of 12 to 18 months, consider various scenarios that could occur during that time. Some factors to consider include: - Technological advancement - Your product’s life cycle - Current political conditions - Your competitors When brainstorming potential changes, investigate the past for reference. What happened in the last 12 to 18 months? Don’t limit your thinking to business-related occurrences, either. Yes, you need to consider changes that occurred in your organization. But you’ve also got to think further out. What changes happened in your industry, country, or the world? Covid-19 is the perfect example of a possible scenario that affected the entire world (even though it was almost impossible to predict). The point is that you need to consider changes that could impact the company both inside and outside of its borders. ### 2\. Recognize existing trends No, we’re not talking about the latest fashion trends but rather, the trends and driving forces impacting your organization today. Think about who’ll be affected by these trends and driving forces - and who or what could influence them. Driving forces can include customers, employees, shareholders, suppliers, competitors, and even the government. When considering driving forces, identify their existing roles, interests, positions, and progress over time. [Breaking Down the FP&A Function of the CFO SuiteWhen hiring your first CFO, it’s important to understand how the FP&A function works. Read this post to learn about the inner workings of FP&A functions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceAlex Lee![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/05/entrepreneur-g544a615c4_640.jpg)](https://www.financealliance.io/breaking-down-the-fp-a-function-of-the-cfo-suite/) ### 3\. Build a strategic scenario planning template You’ve identified the key driving forces, such as markets, customer behavior, technology, organizational capacities, the competitive structure of your industry, etc. Now, you can include these driving factors in your scenario planning template. Having a template will save you time as you can use it to create each scenario action plan. ### 4\. Develop multiple scenarios This is where the real legwork begins. It’s time to build multiple scenarios - but start with one at a time. Developing a single scenario to start with minimizes the sheer amount of overwhelm that comes with strategic scenario planning. We advise that you try to keep things as simple as possible. You can start by building a condition related to each driving force included in the template. Then, create a situation based on the trends of the market. This is where your storytelling skills come into full effect. You’ll have to consider things like how this scenario will likely play out. If it helps, think of it as writing a plot of a story or movie. Then, build your scenario around it, making sure to identify specific touchpoints along the way. [4 roles every CFO must dominate:The changing role of the CFOTraditionally, the roles of the CFO consisted of the Operator and Steward. But now, those roles have evolved. Discover the 4 roles every CFO must master in this podcast episode and blog post.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO.jpg)](https://www.financealliance.io/podcast/4-roles-every-cfo-must-dominate-changing-role-of-the-cfo/) ### 5\. Evaluate your scenarios Once you've created a scenario, take out your magnifying glass and evaluate it using a systematic approach. When creating scenarios, it can be tempting to rely on your imagination a bit too much. To avoid this, base your scenarios on data as well as experience and knowledge. When evaluating a scenario and brainstorming everything that could impact the issue, it’s worth asking questions to generate answers. Here are a few examples for talk’s sake: \- What will customers think about our product? \- Will energy and gas prices rise or fall? [Are you prepared for ESG and sustainable finance?What is sustainable finance? And how can CFOs help their organization prepare for ESG and sustainable finance? In this blog post, we dive into the true meaning of sustainable finance and ESG.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/What-is-sustainable-finance.jpg)](https://www.financealliance.io/are-you-prepared-for-esg-and-sustainable-finance/) ### 6\. Create an efficient and effective response strategy Now that you have a detailed list of scenarios, you can build a response strategy for each one. Your action plan should act as a framework that the entire team can follow. It’s also important to update your strategies to keep up with market trends and changes. You’ll also have to update your existing strategy as decisions are made by the senior management of your company in real-time. Simply put, your action plan must provide your organization with the roadmap to react to disruption quickly and confidently. ### Tips for building a strategic scenario based planning strategy When building potential outcomes for your scenario based planning strategy, there are many key points to consider. You’ll begin with the key issue you want to address and clarify the time frame (12 months, several years, a decade, etc). Then, you must think about the external factors that could impact your scenarios. This is then followed by the internal drivers that need addressing. Next, define assumptions based on the scenario. And define what perspective the company must take when reacting to the said scenario. Finally, strive to maintain the scenario by ensuring the company has the necessary data, skills, technology, and bandwidth to react to scenarios accordingly. Here are a few more tips to help create a strategic scenario planning strategy: - If you work in a large organization, make sure you assemble the best team for the job. Your team should include [FP&A](https://www.financealliance.io/how-finance-automation-is-changing-role-fpa/) members and other business units such as Human Resources. - Collect the relevant data. You can’t create accurate case scenario plans without having the right data. This includes historical data, headcount, comparative sales data, etc. - Keep things simple. Model with basic scenarios. - Review short term and long term trends likely to impact your organization and do so often! - Resist the temptation to base decisions on what you know right now. - Although historical data reveals a lot, it’s a bad idea to assume that the future will look the same as the past. - Assess how scenarios will impact the business and create response strategies for each one. **Key factors and takeaways:** 1. **Strategic scenario planning** investigates the past and present to predict the **future**. 2. Your **scenario action plan** should focus on identifying **future threats, risks, and opportunities**. It must act as an easy-to-follow roadmap that ‘safely’ leads the organization through disruption quickly and confidently. 3. Don’t forget to **analyze existing trends and driving forces** impacting your organization. Then, build those into your strategic scenario planning process. 4. Think about **creating a scenario** in the same way that a writer builds the plot of a story. Then, build your scenario around it, making sure to **identify specific touchpoints** along the way. **Want to read more articles about FP&A? [Check out our library of FP&A content right here and get stuck in!](https://www.financealliance.io/tag/fp-a/)** --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_1.jpg) ](https://www.financealliance.io/community/) ### Should you use rolling forecasts? Weighing the pros and cons URL: https://www.financealliance.io/should-you-use-rolling-forecasts-weighing-the-pros-and-cons/ Last updated: 2023-08-10T12:08:22.000Z The pandemic demonstrated just how important business resilience can be for an organization. A key element of optimal business continuity is agility. If your finance team is looking to improve agility in its day-to-day operations, [rolling forecasts](https://www.financealliance.io/rolling-forecast-best-practices/) can help. Towards the end of 2021, the world’s central banks were calling inflation “transitory” - a temporary problem that was nothing to worry about - and a mere six months later, the world entered its worst inflationary cycle in decades. Moreover, in the last few years alone, organizations have faced other concerns, such as Brexit, trade tariff standoffs and protectionism, supply chain gridlock, and the Russian invasion of Ukraine. Now, in 2022, the world’s financial markets are experiencing high volatility, interest rates are rising, and most economists predict a coming recession. These are all external events that are causing uncertain market conditions, over which organizations have little to no control. However, these factors can severely curtail performance and even become an existential threat. For this reason, organizations must proactively take charge of what is in their domain of control, taking steps to make their operational processes and infrastructure as agile as possible, to support resilience and business continuity. One method of supporting enhanced agility is by transitioning to *rolling cash flow forecasts*. While there are challenges in doing so, they can put a company in a much stronger position, with far more precision, relevance, and market awareness ‘baked into’ their strategic planning. Topics covered in this article: - [What is a rolling cash flow forecast?](https://www.financealliance.io/p/dbb2fdc7-c50e-4ed7-bb88-adecd80bd9e8/#what-is-a-rolling-cash-flow-forecast) - [Rolling forecasts vs. traditional forecasts](https://www.financealliance.io/p/dbb2fdc7-c50e-4ed7-bb88-adecd80bd9e8/#rolling-forecasts-versus-traditional-forecasts-what%E2%80%99s-the-difference) - [Challenges of traditional forecasting](https://www.financealliance.io/p/dbb2fdc7-c50e-4ed7-bb88-adecd80bd9e8/#what-are-the-challenges-of-traditional-forecasting) - [Benefits of a rolling forecast](https://www.financealliance.io/p/dbb2fdc7-c50e-4ed7-bb88-adecd80bd9e8/#what-are-the-benefits-of-a-rolling-forecast) - [Tips to transition easily to rolling forecasts](https://www.financealliance.io/p/dbb2fdc7-c50e-4ed7-bb88-adecd80bd9e8/#tips-to-transition-easily-to-rolling-forecasts) - [Best practices to maximize rolling forecast performance](https://www.financealliance.io/p/dbb2fdc7-c50e-4ed7-bb88-adecd80bd9e8/#best-practices-to-maximize-rolling-forecast-performance) - [Driving optimal corporate agility with rolling forecasts](https://www.financealliance.io/p/dbb2fdc7-c50e-4ed7-bb88-adecd80bd9e8/#driving-optimal-corporate-agility-with-rolling-forecasts) [Are you prepared for ESG and sustainable finance?What is sustainable finance? And how can CFOs help their organization prepare for ESG and sustainable finance? In this blog post, we dive into the true meaning of sustainable finance and ESG.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/What-is-sustainable-finance.jpg)](https://www.financealliance.io/are-you-prepared-for-esg-and-sustainable-finance/) ## What is a rolling cash flow forecast? The ‘rolling’ method of cash flow forecasting sees a financial department periodically update its cash flow outlook. There is typically no maturity date for rolling forecasting. Instead, the forecast simply gets updated constantly, such as on a weekly or monthly basis. In this way, a rolling budget is a “live” document that is regularly updated to reflect changing market/business conditions and developments. ## Rolling forecasts versus traditional forecasts: What’s the difference? A traditional cash flow forecast is a predictive analysis of an organization’s cash inflows and outflows to measure future performance, such as on a monthly, quarterly, or annually basis. It is a ‘set-and-forget’ document that is used to assist an organization in its financial planning process and organizational strategy. In comparison, a rolling forecast model is a constantly evolving document that is updated periodically to reflect changes to accounts receivable and payable. For instance, a sudden central bank interest rate hike typically results in a company having to pay more interest on business loans from commercial banks. The finance department can make such a change in a rolling forecast, whereas this would not be possible with a traditional static forecast. [4 roles every CFO must dominate:The changing role of the CFOTraditionally, the roles of the CFO consisted of the Operator and Steward. But now, those roles have evolved. Discover the 4 roles every CFO must master in this podcast episode and blog post.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO.jpg)](https://www.financealliance.io/podcast/4-roles-every-cfo-must-dominate-changing-role-of-the-cfo/) ## What are the challenges of traditional forecasting? The primary disadvantage of the traditional method of forecasting is that, should business conditions or performance change from what is predicted, the forecast is immediately rendered inaccurate and out of date. For instance, if an expected large cash inflow fails to materialize, as a result of debtor payment default, the resultant cash balance will be incorrect, which will then impact the entirety of the rest of the forecast. If multiple events occur which differ from the predicted, the forecast very quickly becomes out of date. The result is that organizations may either still use a forecast that is out of date or inaccurate, or fail to use it because they don’t feel that it is of use anymore, which means that they must strategize and execute without the crucial foundation that an accurate forecast provides. [5 surprising advantages of xP&AWhat is xP&A? In this post, we define the meaning of xP&A and share 5 surprising advantages of xP&A that every CFO should be aware of.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/5-facts-about-xp-a.jpg)](https://www.financealliance.io/5-advantages-xp-a/) ## What are the benefits of a rolling forecast? They enable the financial department to constantly keep the company’s financial outlook up to date. As a result, executives are fully aware of how such changes will impact the company’s finances, which positions them to plan, allocate funding, and make the necessary changes to optimize the company’s cash flow. A rolling forecast model helps a company to: - Identify cash flow shortfalls with more recent business and market intelligence. - Plan for future growth with more accurate insights at hand. - Identify areas of business that are generating suboptimal performance. - Provide early notification of upcoming funding gaps and the opportunity to pivot accordingly. - Avoid outgoing payment defaults and highlight commercial opportunities. All of these benefits are also possible with a traditional cash flow forecast. However, the core benefit of the rolling variety is that it enables much greater precision and market relevance as it is much more up-to-date. Therefore, organizations work with much more reliable insights, whereas a traditional forecast may no longer provide accuracy. In fact, the traditional type of forecast may even damage an organization by guiding company executives with a completely out-of-date cash flow outlook, which varies significantly from reality. [Top 10 SaaS CFO duties for scaling an epic SaaS companywhat are the main SaaS CFO duties on your plate? And what can you do to lead the finance team and the company to roaring success? In this article, we’re diving into the top 10 SaaS CFO duties for scaling an organization to new heights![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/SaaS-CFO-Duties-2.jpg)](https://www.financealliance.io/top-10-saas-cfo-duties/) ## Tips to transition easily to rolling forecasts When deciding to move on from traditional financial forecasting to a rolling forecasting process, there are a number of factors to consider. **1\. Potential resistance to change** Corporate finance leaders have traditionally focused on standard cash flow forecast processes. Moreover, the various stakeholders in the wider financial ecosystem also tend to work with, and expect, the standard variety, such as investors. Therefore, the first step in making the switch to rolling forecasts is to communicate the benefits among the company’s decision-makers, investors, and advisors. **2\. Automation and data technology** You can support the finance department with investment in the right automation and data management technological capabilities. Building out a robust tech stack can markedly reduce the workload for various needs, such as data gathering, entry, and analysis. **3\. New workflow process design** Changing to rolling forecasts tends to increase your finance team’s workload, as they are moving from a once-and-done approach for a set period of time, such as a year, to a periodic update approach, such as on a monthly basis. This may necessitate further recruitment, although investment in the right technologies, as mentioned in point two, can alleviate workload in other ways. A full understanding of how committing to rolling forecasts by redesigning the finance team’s workflow will help them make the transition, as well as highlight any possible bottlenecks. [5 ways CFOs can accomplish finance digital transformationAs the CFO, you’ll lead the charge for finance digital transformation within the organization. But doing so takes some work. Here are 5 ways CFOs can drive finance digital transformation, optimize business processes, and even enhance overall profitability.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/finance-digital-transformation.jpg)](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) ## Best practices to maximize rolling forecast performance To optimize the effectiveness of your rolling forecast process, here are some best practices to follow. ### Define your rolling forecast goals What exactly do you want rolling forecasts to help your company with? What is it that you expect from them that is different from the traditional static forecast model? It's important to write these goals down, to be able to measure performance against your ideal outcome. ### Identify data sources and define your collaborative process Data will be essential to the accuracy and efficacy of your rolling forecasts. Defining data sources and how to manage them - capture, storage, analysis, and interpretation - is key. Moreover, the right software that enables efficient collaboration across departments is also an essential prerequisite to support rich data management and financial forecasting precision. ### Upgrade from spreadsheets Reliance on spreadsheets can significantly hamper a financial department. While they may still have a role to play, dynamic, data-driven technologies such as FP&A software can provide a wealth of highly useful features such as automation of data entry, end-to-end data management, and rolling forecast support. ### Decide the period of time for updates Each business and industry is different. Depending on your company’s own specific needs and cash flow profile, it may be best to update your rolling forecasts fortnightly, monthly, or quarterly. Your financial department should have clear dates to produce an updated forecast report, such as the first of every month. ### Review performance At the end of each rolling period, an appraisal helps your organization understand how accurate - or not - each forecast update was, by comparing the predicted cash inflows and outflows against the reality of how the company’s financials have gone for the period in the forecast. This better enables you to take the necessary steps to address problem areas accordingly. [Top 10 must-have CFO skills to be really successfulThe modern CFO wears multiple hats and must master a variety of skills. But what skills does the CFO of the future need to stay on top? Here are the top 10 skill sets for CFOs of tomorrow.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/arrow-gb0e6f39dd_1920.jpg)](https://www.financealliance.io/top-10-cfo-skills/) ## Driving optimal corporate agility with rolling forecasts Finance teams can use rolling forecasts to be more agile and strategic. While there is more work involved, the trade-off is that your forecasting is likely to be much more accurate and up to date with more recent changes to market and business conditions incorporated into your financial outlook. Since the pandemic began in 2020, improving business continuity credentials and resilience are key goals for company executives. In a volatile global corporate environment, transitioning to rolling forecasts can help your company become more robust and future-proofed against the potential for negative events to impact cash flow. Greater precision in the forecasting process can also support your organization with optimal financial management strategy design. ****Want to learn more about FP&A? [Check out some of our other articles on this topic right here.](https://www.financealliance.io/tag/fp-a/)** --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ‍ ### CFO: Emotional intelligence URL: https://www.financealliance.io/cfo-emotional-intelligence-framework/ Last updated: 2024-06-20T13:46:06.000Z One of the most important CFO skills that often gets overlooked is emotional intelligence. A CFO with high emotional intelligence (EQ) is *gold*. They understand their own emotions and can read the room like a book. So, what exactly is emotional intelligence? Emotional intelligence (EI or EQ) is the ability to recognize, understand, manage, and use your own emotions in positive ways to: - Relieve stress - Communicate effectively - Empathize with others - Overcome challenges - Defuse conflict It also involves recognizing and understanding the emotions of others, which is essential for building and maintaining healthy relationships, both personally and professionally. Emotional intelligence is often broken down into four core skills, grouped under two main competencies - personal and social. On the personal side, you have self-awareness and self-management. **Self-awareness** is really understanding your own emotions, strengths, and weaknesses, and having that self-confidence. **Self-management** is controlling impulses, managing emotions healthily, taking initiative, following through on commitments, and adapting as needed. Socially, it's about awareness and relationship management. **Social awareness** means understanding the emotions, needs and concerns of others, picking up on cues, feeling comfortable in groups, and recognizing power dynamics. **Relationship management** involves developing rapport, communicating clearly, inspiring and influencing people, collaborating well, and managing conflict productively. To be a good CFO, you’ve got to step into the roles of not only leadership, but the role of coach, motivator, and collaborator - all of which require a high degree of emotional intelligence. ### Are you prepared for ESG and sustainable finance? URL: https://www.financealliance.io/are-you-prepared-for-esg-and-sustainable-finance/ Last updated: 2025-04-05T07:44:57.000Z Did you know that investors are more likely to evaluate a company’s environmental, social, and governance (ESG) metrics *before* investing a single penny? The current climate crisis continues to deteriorate and it’s something that should be on every company’s radar. After all, achieving a sustainable future is a team effort – including the finance sector, which holds more power to bring about positive change than you might think. But what is sustainable finance? And how can a CFO help their organization prepare for ESG and sustainable finance? In this article, we dive into the true meaning of sustainable finance and ESG. We also share some helpful ways to drive your company towards a more sustainable future. Topics covered in this article: - [What is sustainable finance?](https://www.financealliance.io/p/1e56ccd1-2bb8-4bd7-8fc4-f8f63b5dbba0/#what-is-sustainable-finance) - [Why finance teams should care about ESG and sustainable finance](https://www.financealliance.io/p/1e56ccd1-2bb8-4bd7-8fc4-f8f63b5dbba0/#why-should-finance-teams-care-about-esg-and-sustainable-finance) - [Benefits of sustainable finance](https://www.financealliance.io/p/1e56ccd1-2bb8-4bd7-8fc4-f8f63b5dbba0/#7-benefits-of-esg-and-sustainable-finance) - [Tips to help deploy an ESG strategy in your company](https://www.financealliance.io/p/1e56ccd1-2bb8-4bd7-8fc4-f8f63b5dbba0/#how-to-deploy-an-esg-strategy-in-your-company) - [What is sustainable finance in business? Areas CFOs can improve sustainability](https://www.financealliance.io/p/1e56ccd1-2bb8-4bd7-8fc4-f8f63b5dbba0/#what-is-sustainable-finance-in-business-areas-cfos-can-improve-sustainability) [How to transition your team from number crunchers to finance business partnersFinance teams are more than just number crunchers. To become a finance business partner, you must create value by providing insights that help business leaders make data-driven decisions.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTim Schöler![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/finance-business-partners-header-image.jpg)](https://www.financealliance.io/number-crunchers-finance-business-partners/) ## **What is sustainable finance?** We have a lot to unpack here. So let’s begin by answering the question on top of everyone’s minds – what is sustainable finance? Sustainable finance is when companies consider the environmental, social, and governance (ESG) impact of their sustainable investment decisions. It’s a topic that has flared a great deal of conversation amongst finance teams lately, as well as those working in financial institutions and financial services. If you’re looking for investors, it’s time to put the environment at the forefront of your financial efforts. Many investors are reluctant to part with their cash unless a company’s ESG assessment comes back *glowing*. [The 3 pillars of a successful finance partnerWant to know how to become a successful finance partner? The role of the finance function has changed massively over recent years. Rather than generating reports all day, finance pros must step into a partnership role and work closely with other functions of the business.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/money-g094a1229b_1920-2.jpg)](https://www.financealliance.io/podcast/3-pillars-successful-finance-partner/) An ESG data assessment determines how economic a company is by evaluating its performance relating to each area of ESG (Environmental, Social, and Governance). Here’s some more information about each: ### **Environmental** How much does your company contribute to climate change and other environmental factors? This could include anything from waste and asset management to energy efficiency and manufacturing processes. The Environmental criteria assess: - Resource depletion - Waste management - Pollution - Decarbonizing and reducing emissions - Deforestation - Climate change/ Climate risk - Energy efficiency - Greenhouse gas emission - Emissions - Energy - Supply chain - Materials - Water [5 ways CFOs can accomplish finance digital transformationAs the CFO, you’ll lead the charge for finance digital transformation within the organization. But doing so takes some work. Here are 5 ways CFOs can drive finance digital transformation, optimize business processes, and even enhance overall profitability.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/finance-digital-transformation.jpg)](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) ### **Social** What's your company’s social impact on social issues within its local community and beyond? The Social criteria assess: - Working conditions - Conflict - Local communities - Health and Safety - Human rights - Diversity and inclusion - Labor standards - Employee benefits, retention, training, and education - Non-discrimination - Public policy/political contributions - Marketing and labeling - Customer Privacy [Top 10 SaaS CFO duties for scaling an epic SaaS companywhat are the main SaaS CFO duties on your plate? And what can you do to lead the finance team and the company to roaring success? In this article, we’re diving into the top 10 SaaS CFO duties for scaling an organization to new heights![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/SaaS-CFO-Duties-2.jpg)](https://www.financealliance.io/top-10-saas-cfo-duties/) ### **Governance** What does sustainable finance look like for *your* company? And how can you prepare for a more sustainable financial future? ESG Governance standards are in place to make sure accurate and transparent accounting methods are in place. The Governance criteria assess: - Executive payment - Donations - Anti-corruption - Board diversity - Tax strategy - Governance structure and composition - Conflicts of interest - Board ESG role/responsibility - Grievance mechanisms [Cash flow is KING and data flow is QUEENJust like an educated workforce is the lifeblood of the knowledge economy, data is now the lifeblood of the digital economy. In this post, you’ll learn why cash flow is King, but data flow is Queen.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTjendra Halima![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Data-is-queen.jpg)](https://www.financealliance.io/cash-flow-is-king-and-data-flow-is-queen/) ## Why should finance teams care about ESG and sustainable finance? According to [Gartner](https://www.gartner.com/smarterwithgartner/the-esg-imperative-7-factors-for-finance-leaders-to-consider), 85% of investors considered ESG in their investments in 2020\. So, we’re not going to sugar-coat it for you. If your organization doesn’t meet ESG criteria, investors will see you as a risky proposition. In 2022, investment strategies are focusing on the importance of ESG and the impact that businesses (including the financial sector) have on the carbon economy. Here are a few more statistics from [Gartner](https://www.gartner.com/smarterwithgartner/the-esg-imperative-7-factors-for-finance-leaders-to-consider) to bring it home: \- One in 10 investors locate the ESG in they’re searching for in corporate disclosures. \- 99% of banks, 71% of fixed income investors, and over 90% of insurers check ESG. Investors care about ESG enough to turn away from a potential partnership for good. This isn’t the best news for companies that need investors to scale. So, why does this drive for ESG investing and sustainable finance exist? Here are a few reasons: 1\. Input costs 2\. Innovative strategy 3\. Business ethics 4\. Consumer preferences 5\. Corporate reputation 6\. Competitive positioning 7\. Regulatory intervention 8\. Supply chain reliability All the reasons above work together to achieve the common goal that all investors share - reduced investment risk. ## 7 benefits of ESG and sustainable finance Why should CFOs and finance teams consider sustainability in their decision-making process? Here are 7 benefits of sustainable finance and ESG: 1\. Cut costs and improve efficiency by using fewer resources. 2\. Align ESG criteria with the financial outcomes of your organization. 3\. Demonstrating that your organization meets ESG criteria gives you a competitive advantage. Therefore, your organization will appear more appealing to potential investors. 4\. ESG and sustainable finance has proven to have a positive impact on revenue growth. 5\. Sustainability increases innovation. It also helps finance teams to prepare for the future by updating business models, processes, and technology. 6\. Putting people first is important. Try being considerate about the health and safety of your employees to improve your retention rate. 7\. Build stronger stakeholder relationships and improve your reputation at the same time. [4 roles every CFO must dominate:The changing role of the CFOTraditionally, the roles of the CFO consisted of the Operator and Steward. But now, those roles have evolved. Discover the 4 roles every CFO must master in this podcast episode and blog post.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO.jpg)](https://www.financealliance.io/podcast/4-roles-every-cfo-must-dominate-changing-role-of-the-cfo/) ## How to deploy an ESG strategy in your company You know the answer to the question – what is sustainable finance? But how can you deploy an [ESG strategy](https://www.financealliance.io/from-digital-strategy-to-esg/) in your organization and move towards a more sustainable future? The entire finance team can help move the organization towards sustainable finance. However, the CFO will likely have more success laying the foundation. So, make sure you have them on your side if you’re not the CFO yourself. The first step is to develop a vision for how the finance function will drive ESG. You must make ESG and sustainable finance a priority for the company. Communicating that strategy to the CEO and board of directors comes next. Brace yourself for some conversations about what sustainable finance is, and why it’s beneficial to the company (and its impact on the bottom line).💰 Next, align company performance metrics to your ESG goals. Generate value for stakeholders by connecting key metrics to the overall impact of ESG. It’s one thing to implement a company-wide ESG strategy. But, if you don’t align it to business goals, you’ll have a hard time proving its value and positive impact. Finally, you’ve got to measure the results of the ESG strategy. Track and assess the effect of ESG initiatives and be completely transparent in your financial reporting standards. Your ESG reporting/sustainability reporting should include key ESG metrics that assess the company’s environmental, social, and corporate governance criteria. ## What is sustainable finance in business? Areas CFOs can improve sustainability When assessing a business’ ESG performance, investment managers often use investor-based reporting frameworks and/or questionnaires. Some key topics of interest to investors include emissions of greenhouse gases and climate risk disclosures. They also tend to use reporting platforms such as Task Force on Climate-related Financial Disclosures (TCFD). Specifically, you can expect investors to ask for your company’s metrics on emissions totals and the emissions intensity of your products and services. If you want your organization to be as attractive as possible to investors, be strategic about your ESG strategy. We talked about what is sustainable finance, the benefits, and tips for employing an ESG strategy – but what areas of the business can become more sustainable? Some key areas include the overall company strategy. For investors to take an interest, you must be seen as a responsible investment opportunity and prove that the company’s goals align with ESG-related goals. [5 surprising advantages of xP&AWhat is xP&A? In this post, we define the meaning of xP&A and share 5 surprising advantages of xP&A that every CFO should be aware of.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/5-facts-about-xp-a.jpg)](https://www.financealliance.io/5-advantages-xp-a/) You’ve also got to demonstrate how ESG factors are driving value for the business, such as efficiency or sales productivity. Another area CFOs can improve sustainable development in your company is via your financial track record. Does it accurately showcase how the company has allocated capital to green initiatives? Has the company moved towards recyclable packaging? Consider ways to prove your company is moving towards sustainable finance and focusing on environmental efficiency. If you want to keep investors, employees, customers, and other stakeholders happy, you’ve got to commit to the cause, especially in times of disruption. Investors will likely want to review your company’s ESG strategy because it'll showcase the type of risks you face. Use this as an opportunity to show your continued commitment to ESG issues through things like: - Supporting the mental health of your employees. - Showcasing how your ESG strategy is helping to improve customer retention and mitigating financial and sustainability risks. - How your company has focused on climate-related changes such as reducing carbon emissions, switching to renewable energy sources, etc. ### Key takeaways 1. **If you want to secure investors, start building your ESG strategy.** Don't forget - 85% of investors consider ESG in their investment choices! 2. **Develop a vision for how the finance function will drive ESG.** You must make ESG and sustainable finance a top priority for the company. 3. **Align company performance metrics to your ESG goals.** Generate value for stakeholders by connecting key metrics to the overall impact of ESG **Want to learn more about ESG and sustainable finance?** [**Check out some of our other articles on this topic right here.**](https://www.financealliance.io/tag/esg/) --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_2.jpg) ](https://www.financealliance.io/community/) ### Cash flow is KING and data flow is QUEEN URL: https://www.financealliance.io/cash-flow-is-king-and-data-flow-is-queen/ Last updated: 2022-08-15T11:00:37.000Z Just like an educated workforce is the lifeblood of the knowledge economy, data is now the lifeblood of the digital economy. Today’s business world runs on data. "Data is the new oil”. Oil is buried deep under the earth and becomes valuable once we learned how to extract and process them to become fuel to generate energy. And, it's the same with data. In this post, you'll learn why cash flow is King, but data flow is Queen. Summary of topics discussed in this post: - [Data and cash](https://www.financealliance.io/p/cc0d5179-989e-407f-8140-ef025cc5c8ba/#data-and-cash) - [Data flow and cash flow](https://www.financealliance.io/p/cc0d5179-989e-407f-8140-ef025cc5c8ba/#data-flow-and-cash-flow) - [Data flow cycle vs cash flow cycle](https://www.financealliance.io/p/cc0d5179-989e-407f-8140-ef025cc5c8ba/#data-flow-cycle-and-cash-flow-cycle) - [Data science vs data analytics ](https://www.financealliance.io/p/cc0d5179-989e-407f-8140-ef025cc5c8ba/#data-science-vs-data-analytics) [4 roles every CFO must dominate:The changing role of the CFOTraditionally, the roles of the CFO consisted of the Operator and Steward. But now, those roles have evolved. Discover the 4 roles every CFO must master in this podcast episode and blog post.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO.jpg)](https://www.financealliance.io/podcast/4-roles-every-cfo-must-dominate-changing-role-of-the-cfo/) ## DATA and CASH **DATA**, like oil, is an immensely untapped valuable asset. Those who manage to extract and unlock its value will be rewarded with Sustained Profitable Growth and **CASH**. **CASH is KING** and **DATA is QUEEN**. Behind every successful man \[**KING**\] there is a woman \[**QUEEN**\]. In the digital world, Data generates Cash, not the other way around. Cash generation is the consequence of data management. Everything we do today leaves digital footprints. This vast pool of data is an immensely untapped valuable strategic asset. Big data and cloud computing technology improve the available data, the accessibility of data, and the speed of data processing. It enables agility in data management and the capability to uncover valuable data-driven insights to drive and impact business performance. Data allows us to gain and act on customer insights, predict future financial and market trends, and enact systemic change for social good. The ability to mine and unlock the intrinsic value of data will deliver actionable business insights, discover new business models, generate new revenue streams, and enhance customer experience. By monetizing the financial value of DATA, the organization gains the competitive advantage to generate sustained profitable growth and ultimately CASH. [Top 10 SaaS CFO duties for scaling an epic SaaS companywhat are the main SaaS CFO duties on your plate? And what can you do to lead the finance team and the company to roaring success? In this article, we’re diving into the top 10 SaaS CFO duties for scaling an organization to new heights![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/SaaS-CFO-Duties-2.jpg)](https://www.financealliance.io/top-10-saas-cfo-duties/) ## DATA FLOW and CASH FLOW In the living world, nothing is so much taken for granted as breath, the literal source of our lifeblood. Breath is invisible yet ever-present and vital for living beings. The inability to breathe silences people and polluted air shuts those with breathing difficulties behind the protection of closed doors. Just like living beings, business is dynamic, not static. Business needs to breathe with unpolluted data. Unfortunately, data is an intangible asset that doesn’t have a place or value in the balance sheet. Data is the oxygen that is vital and needed by businesses to breathe in the digital economy. Human beings need to breathe so that the blood can flow and circulate in the body ecosystem. The same thing applies to the business world. To achieve sustained profitable growth, business needs to continuously have quality DATA FLOW in the business ecosystem to generate continuous positive CASH FLOW. Here is the best way to illustrate static vs dynamic using the mathematical formula: - Static: (1+0%)^365 is equal to 1.00 - Dynamic: (1+1%)^365 is equal to 37.78 > **Static Cash (Idle Cash)** is not KING and **Static Data (Historical Data)** is not QUEEN. **Positive Cash Flow** is KING and **Quality Data Flow** is QUEEN. [5 ways CFOs can accomplish finance digital transformationAs the CFO, you’ll lead the charge for finance digital transformation within the organization. But doing so takes some work. Here are 5 ways CFOs can drive finance digital transformation, optimize business processes, and even enhance overall profitability.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/finance-digital-transformation.jpg)](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) ## DATA FLOW Cycle and CASH FLOW Cycle The **data flow cycle** describes the path data takes from when it’s first generated and captured to when it’s interpreted into actionable insights and its eventual archival and/or deletion at the end of its useful life. This life cycle can be split into eight steps: generation, collection, processing, storage, management, analysis, visualization, and interpretation. ![No alt text provided for this image](https://media-exp1.licdn.com/dms/image/D4D12AQFyys6T1wlpsw/article-inline_image-shrink_1500_2232/0/1655702619908?e=1665619200&v=beta&t=vO5Fccbelg7fxMsnZYQFYai-a_U6fDNe919aKTiwpe4) The **cash flow cycle** is the movement of money into and out of business; it's the cycle of cash inflows and cash outflows that determine the business's solvency. Companies need cash to pay workers, pay suppliers, repay debts, innovate, invest and expand. Whether a business survives, thrives, or fails can be dependent on cash flow management. ![No alt text provided for this image](https://media-exp1.licdn.com/dms/image/D4D12AQFIBbdHxyJiGQ/article-inline_image-shrink_1500_2232/0/1655701761975?e=1665619200&v=beta&t=W2q0AFLO5-5rurKufmy4FmAOSNwku13W3kxYwfHHEqM) ## Data Science vs Data Analytics If cash flow is the consequence of data flow in the digital economy, then businesses should focus and invest in data management skills and technology as one of the key competitive advantages. The volume of data that business has to deal with has exploded to unimaginable levels in the past decade, and at the same time, the price of data storage has systematically reduced. The challenge of this era is to make sense of the sea of data. [CFO Playbook: From digital to ESG strategy integrationCFOs, as co-pilots of CEOs, are always the catalysts to drive business transformation and align visions and strategies across the entire organization.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceTjendra Halima![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/micheile-dot-com-ZVprbBmT8QA-unsplash-2.jpg)](https://www.financealliance.io/from-digital-strategy-to-esg/) In the world of data, we are likely to encounter these two terms: “data science” and “data analytics.” While these terms are related, they refer to different things. Here is a very brief description of each term in the context of a business organization. - **Data science** is the process of building, cleaning, and structuring datasets to analyze and extract meaning. - **Data analytics** is the process and practice of analyzing data to answer questions, extract insights, and identify trends. These topics will not be covered in detail in this article. A dedicated article is needed to describe in-depth data science and data analytics. ## Summary 𝗖𝗔𝗦𝗛 𝗶𝘀 𝗞𝗜𝗡𝗚 𝗮𝗻𝗱 𝗗𝗔𝗧𝗔 𝗶𝘀 𝗤𝗨𝗘𝗘𝗡. By monetizing the financial value of **𝗗𝗔𝗧𝗔**, an organization gains a competitive advantage to generate sustained profitable growth and ultimately **𝗖𝗔𝗦𝗛**. Business is dynamic, not static. **𝙎𝙩𝙖𝙩𝙞𝙘 𝘾𝙖𝙨𝙝 (𝙄𝙙𝙡𝙚 𝘾𝙖𝙨𝙝)** is not KING and **𝙎𝙩𝙖𝙩𝙞𝙘 𝘿𝙖𝙩𝙖 (𝙃𝙞𝙨𝙩𝙤𝙧𝙞𝙘𝙖𝙡 𝘿𝙖𝙩𝙖)** is not QUEEN. Just like **𝕆𝕩𝕪𝕘𝕖𝕟** and **𝔹𝕝𝕠𝕠𝕕** need to circulate and flow in the body ecosystem, **𝔻𝕒𝕥𝕒** and **ℂ𝕒𝕤𝕙** need to circulate and flow in the business ecosystem. **𝗖𝗔𝗦𝗛 𝗙𝗟𝗢𝗪 𝗶𝘀 𝗞𝗜𝗡𝗚** and **𝗗𝗔𝗧𝗔 𝗙𝗟𝗢𝗪 𝗶𝘀 𝗤𝗨𝗘𝗘𝗡.** **Want to read more great articles by Tjendra? [Check out his incredible library of content right here.](https://www.financealliance.io/author/tjendra/)** --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) ### 4 roles every CFO must dominate: The changing role of the CFO URL: https://www.financealliance.io/podcast/4-roles-every-cfo-must-dominate-changing-role-of-the-cfo/ Last updated: 2026-01-23T10:17:42.000Z Today’s CFO must manage multiple priorities and drive numerous initiatives, managing both functional and company objectives. However, the role of the CFO has entered a period of transition and evolution. CFOs are more than just finance leaders. They’re not only running the finance function and ensuring compliance, they’re shaping the entire company strategy and playing a pivotal role in driving positive change in their organizations. Traditionally, the roles of the CFO consisted of the Operator and Steward. But now, those roles have evolved, and more responsibilities have been added to the CFO’s plate. The modern CFO position must embrace the more recent roles of a Catalyst and Strategist. So, how can a CFO master each of these roles? And what does each role entail? Discover the answers in this episode of the Two Cents: Finance Talk podcast with Amit Singhi, the Chief Financial Officer of the Humanetics Group. Amit elaborates on the various roles of a CFO. He even provides perspectives and examples of the evolving roles, making this an episode you don’t want to miss. **Listen to the full episode below:** **Or keep reading to find out:** - [Why the role of the CFO has evolved](https://www.financealliance.io/p/5318784b-f22d-41d1-ae2f-49056b528c54/#why-has-the-role-of-the-chief-financial-officer-cfo-evolved) - [How the Operator role helps to run an efficient finance function](https://www.financealliance.io/p/5318784b-f22d-41d1-ae2f-49056b528c54/#1-the-operator) - [How the Steward role minimizes risk and compliance](https://www.financealliance.io/p/5318784b-f22d-41d1-ae2f-49056b528c54/#2-the-steward) - [How the role of Catalyst drives business performance](https://www.financealliance.io/p/5318784b-f22d-41d1-ae2f-49056b528c54/#3-the-catalyst) - [How the Strategist role helps shape overall company strategies](https://www.financealliance.io/p/5318784b-f22d-41d1-ae2f-49056b528c54/#4-the-strategist) - [The future role of the CFO](https://www.financealliance.io/p/5318784b-f22d-41d1-ae2f-49056b528c54/#the-future-role-of-the-cfo) ## Why has the role of the Chief Financial Officer (CFO) evolved? The CFO has a great view of the entire business. And since most strategic decisions have financial implications, it’s not surprising that the CFO is involved in pretty much all aspects of a company's operations. A CFO’s job description typically allows them to connect the dots across different functions. This allows forward-leaning finance professionals to get more engaged with the business. CFOs have evolved to help operating leaders with critical decision-making and leading and driving operations. This shift in the role of the CFO is also the reason why many finance professionals end up moving into general management roles throughout their careers. Now, let’s take a closer look at the four roles every CFO must master: ![Role of the CFO - Operator](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO-2.png) ### 1\. The Operator The first role of the CFO is the Operator role. The operator traditionally runs the finance function. They’re the *leader*. > *“Every leader is an operator for their function.”* **– Amit Singhi** The CFO’s objective as the Operator is to run an effective and efficient finance function, which embodies everything you might expect such as budgeting, forecasting, financial planning, managing cash flow, risk management, financial management, etc. However, the most important asset of the finance function is *people*. People are at the very center of the finance function because that’s how we get things done. There’s only so much you can do by yourself, which is why the CFO must put people *first*. [Top 10 SaaS CFO duties for scaling an epic SaaS companywhat are the main SaaS CFO duties on your plate? And what can you do to lead the finance team and the company to roaring success? In this article, we’re diving into the top 10 SaaS CFO duties for scaling an organization to new heights![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/SaaS-CFO-Duties-2.jpg)](https://www.financealliance.io/top-10-saas-cfo-duties/) > *“People are our most important assets. That's how we get things done. There's only so much one can do by oneself. But when we leverage our teams, we can multiply the effect many times over.”* – **Amit Singhi** Despite what many people might believe, human resources (HR) isn’t the only function responsible for people's development. As an Operator, people development and talent development are key priorities for the CFO. > *“The finance leadership team is focused on ensuring that we’re attracting the best talent, recruiting them properly, onboarding, training, teaching, developing, promoting, and then retaining the best talent – which is one of the critical functions to run an effective and efficient organization.”* – **Amit Singhi** ![Role of the CFO - Steward](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO-3.png) ### 2\. The Steward The role of the CFO as a Steward involves ensuring compliance and control. The responsibilities under the steward role are classic tasks that have always rested on the shoulders of finance professionals. Some of the key roles of the Steward include keeping on top of the company's financial information, such as: - Accounting - Audit control - Taxes - Financial reporting - Disclosures - Compliance But are these enough for the modern role of the CFO to be high-tech finance professional? Here’s what Amit had to say about it: > *“When you think about it, it's about protecting shareholder assets. All of these are important functions and mandatory as no other function of grouping the company is responsible for these…* > *“However, I think that these are necessary, but not sufficient in today's environment to be a high-tech finance professional.”* – **Amit Singhi** ![Role of the CFO - Catalyst](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO-4.png) ### 3\. The Catalyst As Catalysts, the role of the CFO is to instill a financial mindset throughout all levels of the organization. > *“We teach and promote business acumen. We're driving the operating cycle. This includes monitoring the overall external environment for important global trends, political, economic, and cultural, that could impact the company.”* – **Amit Singhi** ![Catalyst operating cycle chart](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO-5.png) The Catalyst role also includes conducting competitive research and analyzing consumer behavior for insights that can be leveraged. Finance establishes targets and then works with the operations to deliver those targets and ensure they are the best in class. And if they’re not at that level yet, the CFO thinks about how to get there. The role of the CFO requires continuous monitoring and adjustment to continue improving the business and maximizing profitability. > *“As catalysts, we also partner with operations to come up with a strategy to address any gaps. Here, analytics is our best friend.* > *"Data is just the starting point. It needs to be translated into analytics.”* **– Amit Singhi** Solely presenting financial data in an income statement alone isn’t going to cut it. Instead, focusing on identifying the various drivers and the corresponding operating physicals helps pinpoint areas of opportunity. This type of analysis is key for obtaining valuable insights, which enable action and better results. ![Catalyst role - analysis graph](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO-6.png) The role of Catalyst isn’t always easy. You’re going to encounter your fair share of resistance, at least initially, because change causes fear. However, as the CFO, you’ve got to be a catalyst to drive change and you're also responsible for managing the progress of that change. Amit shared a story reflecting his own experience battling resistance as a CFO of FLIR Systems: > *“At FLIR we came up with the idea to increase our payment terms for our suppliers. Our initial response from purchasing was very skeptical. Their point was that our suppliers would respond by raising prices and that a lot of our competitors were getting those terms."* > *"We had a strong, loyal customer base and we had a sound financial standing and investment grade rating, so why should we?”* > *“We didn't give up because we believed in our cause and each other. So, we started advocating.* > *"Finally, we decided that we would contact our suppliers and pitch them the idea. And quite frankly, the results were outstanding. Half of them were fine changing from 30 to 60 days.* > *"The lesson here is very simple. Never give up and never say never. You've got to keep pushing.”* – **Amit Singhi** ![Role of the CFO - Strategist](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO-7.png) ### 4\. The Strategist The fourth role of the CFO is the Strategist role, which is a very important dimension of what a CFO does. As a Strategist, a CFO is the right-hand partner of the Chief Executive Officer (CEO) and the board of directors. The CFO helps define senior management’s (and some key stakeholders’) vision for the future of the company, and then develops and drives the strategic direction of the company. [5 ways CFOs can accomplish finance digital transformationAs the CFO, you’ll lead the charge for finance digital transformation within the organization. But doing so takes some work. Here are 5 ways CFOs can drive finance digital transformation, optimize business processes, and even enhance overall profitability.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/finance-digital-transformation.jpg)](https://www.financealliance.io/5-ways-accomplish-finance-digital-transformation/) The CFO is a business partner and takes the lead in developing a vision for the future, and a strategic plan to carry out that vision. They've also got to have a high level of communication skills to help collaborate with various departments effectively. Here’s an insightful example from Amit on the role of the CFO as a Strategist in action: > *“In the case of Ford, when we were in South America, we called our strategy the ‘South America better plan’ and it was our roadmap for future growth.”* > *“One thing that made South America challenging at that time was that it was somewhere in-between an emerging market with cheap and cheerful low-end vehicles and fully developed markets with very high-end needs.”* > *“Market research revealed that a segment of the consumers was willing to pay more for bells and whistles and technology features.”* > *“Based on this trend analysis, we began investing more in technology and higher-end features and scaling up our vehicles, which improved our overall brand perception, desirability, and allowed us to sell vehicles at a premium gain market share.”* – **Amit Singhi** ![Allocate capital - Strategist role CFO](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO-8.png) Amit also discussed how the role of the CFO as a Strategist changes depending on the organization and industry. For example, if you’re the CFO of a high-tech company, strategy is all about capital structure and capital allocation. You can create significant value by allocating capital to derive the best results and the best returns. Disruption is another key element that can be used to shake up the business and it's something that CFOs can leverage to drive a fundamental shift in the business model and the overall direction of the company. > *“At FLIR several years ago, before I joined, 80% of our business came from the military specifically thermal images that enabled helicopters and planes to conduct surveillance and other missions at night. The infrared technology was amazing. But FLIR was too dependent on one market - the defense side.”* > *“So, we wanted to disrupt the status quo. And one way of doing that was by identifying a new market opportunity and designing new technologies and products to serve new markets and customers.”* – **Amit Singhi** [Top 10 must-have CFO skills to be really successfulThe modern CFO wears multiple hats and must master a variety of skills. But what skills does the CFO of the future need to stay on top? Here are the top 10 skill sets for CFOs of tomorrow.![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w256h256/2021/06/FA_Icon_Colour--1-.png)Finance AllianceSabrinthia Donnelly![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/07/arrow-gb0e6f39dd_1920.jpg)](https://www.financealliance.io/top-10-cfo-skills/) > *“We discovered that thermal technology that was used for long-range surveillance by the military also had commercial applications. This led to the development of a lepton, which is a thermal imaging camera that is smaller than a dime and can fit inside a smartphone, and other handheld devices. It’s 10 times less expensive than a traditional IR camera.”* > *“This is about bringing thermal imaging technology to the masses, or as I prefer to call it disruptive. As a result, FLIR became a more diversified and balanced company, roughly 50% military and 50% commercial consumer, with thermal imaging applications in a variety of new verticals, including smartphones. So again, these are some examples of how disruption and strategy can be a key part of what finance does.”* – **Amit Singhi** ![4 roles of the CFO](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Role-of-the-CFO-9.png) ## The future role of the CFO Aside from adapting the four roles discussed above (Operator, Steward, Catalyst, and Strategist), Amit predicts that the future role of the CFO must focus on enhancing their skill set across all aspects of financial processes. Not only that, but CFOs must lead the finance team and stay on top of emerging trends and metrics, and capitalize on those to gain competitive advantages. > *“I think they will need to leverage Big Data and artificial intelligence for better analytics, provide real-time analysis and insights to operators at their fingertips in a self-serve model.”* > *“Also leverage process automation to drive further efficiencies and utilize blockchain for distributed data sharing. And improving, monitoring, and leveraging cryptocurrency.”* – **Amit Singhi** ![Changing role of the CFO - Ep.4 Two Cents: Finance Talk podcast - Amit Singhi](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/2022/08/Ep.4-Amit-Singhi-2.png) Amit Singhi - Ep.4 Two Cents: Finance Talk podcast ### About the guest [Amit Singhi](https://www.linkedin.com/in/amitsinghi/) has years of experience and is currently the Chief Financial Officer (CFO) of the Humanetics Group, a leading provider of sensory intelligence, virtual simulation, crash test systems, precision sensors, and cutting-edge photonic solutions through its subsidiaries Humanetics, HITEC Sensors, Fibercore, and OpTek Systems. Its solutions create data from critical environments and deliver precision control to empower people in their connected world. Previously, Amit was the Chief Operating and Financial Officer of the Piston Group and before that, he was the CFO at FLIR Systems. Amit is also a board member of Big Brothers Big Sisters of Metro Detroit and the Electrical & Computer Engineering Council at the University of Michigan. He is an executive-in-residence and a guest speaker at the University of Michigan and several international CFO conferences. He was also the recipient of the APACC “Salute to Excellence” Award for Business Leadership in 2018. **Want to listen to more episodes of the Two Cents: Finance Talk podcast? You can tune into more episodes of the show** [**right here**](https://www.financealliance.io/podcast-two-cents-finance-talk/)**.** --- [ ![](https://storage.ghost.io/c/a5/73/a5734519-d6ac-4b17-95b8-f7a3866730ab/content/images/size/w1600/2022/05/FA_Website_Banners_3.jpg) ](https://www.financealliance.io/finance-newsletter/) _Truncated after 5 MiB. Use `/sitemap.xml` for the complete archive of public content._