Better, more accurate enterprise planning, which includes strategies, budgeting and forecasting, ongoing analyses and execution has become critical, says Desmond Botha, financial solutions specialist at Fios.
"Planning, a key element in performance management (PM), can not only provide companies with a competitive edge but will also directly impact the shareholder value of listed entities. Yet many companies continue to manage their businesses with inadequate planning systems and processes. The result: failure to execute the game plan, which can have a dire impact on company performance in the short- and long-term," he says.
According to Botha, true enterprise planning emerges when business planning, business intelligence (BI) and business analytics intersect.
The planning
Botha says that enterprise planning not only turns strategy into plans and budgets for every relevant employee and external partner, but it provides real-time feedback and, more importantly, realigns plans as needs and situations evolve.
In order to establish an effective enterprise planning strategy, Botha suggests the following sever steps are taken:
1. Set the scene and ask some key questions
"Assess and define what best-in-class performance will mean to your organisation," he suggests.
2. Align the game plan
Once you have identified a strategic direction you will need to get everyone on the same page, says Botha.
3. Communication, coordinate and commit
Make the plan operational by breaking it down, distribute individual plans and reach into your organisation to get bottom-up input from people on the front lines, says Botha. "Importantly, you need to gain their commitment and ensure their plans are aligned with enterprise objectives," he says.
4. Understanding the breaking news and analyse
"Detailed, cascading plans must become "living documents", updated according to analyses of your current operating performance," he says.
5. Manage the gaps
"Quite obviously, there will be gaps between corporate goals and individual opinions," says
7. Re-forecast
"Both the last and first steps; analysis and reports will allow your organisation to align with the changes in your business environment," he says.
For example, by supplementing your annual budgeting with rolling forecasts you can reinforce planning as a competency within your organisation. This will result in increased accuracy and visibility into future operating performance; enabling you to correct and align it to corporate objectives.
Share
