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The end of the year is often thought of as a time for celebration. But for finance teams, it’s also one of the busiest times of the year, and inefficient planning processes can lead to high levels of stress. Reviewing a business’s performance and financial situation, setting goals and developing a strategic plan requires a comprehensive view of business data. Finance teams need tools and features that can streamline planning and analysis, and as one of the most powerful data visualization and business intelligence platforms, Power BI is perfect for end-of-year planning.
Traditionally, teams have heavily relied on Microsoft Excel spreadsheets, pulling data from various financial and non-financial sources and dealing with multiple versions of documents. Unfortunately, this approach often leads to an ineffective planning process with insufficient insights, leaving organizations without a single source of truth. The good news is that Power BI, especially when combined with the power of Acterys, provides opportunities for greater efficiency and simplicity in year-end financial planning.
Review common challenges businesses face and find tips to help you simplify your business’ end-of-year planning process. Then, learn how to transform your entire financial planning and analysis with a unified extended planning and analysis solution.
5 Common Year-End Financial Planning Challenges
1. Lack of Visibility
Without a clear and unified view of financial data, businesses are unable to identify trends, patterns and potential areas of improvement. They may struggle to understand the underlying factors driving their financial performance, hindering their ability to make informed decisions.
A lack of visibility can also impede effective collaboration among different departments within the organization. Finance teams may find it challenging to communicate financial insights and forecasts to other stakeholders, such as sales or operations teams. This lack of transparency can lead to misalignment and hinder the overall planning process.
2. Manual Data Gathering and Consolidation
One of the most cumbersome aspects of year-end financial planning is integrating the plethora of data they gather from various data sources. These sources could be accounting-related, like Xero or QuickBooks Online, or operations-related, like Monday.com or Trello. They could be marketing-related, like Google Analytics or Hubspot, sales-related, like Pipedrive or Salesforce, or from any of the other SaaS platforms the business relies on. Having to manually pull this information from these disparate systems can be incredibly taxing and error-ridden.
3. Inefficient Reporting
Traditional reporting methods often involve manual data extraction, manipulation and formatting. Finance teams find themselves spending countless hours sifting through spreadsheets, consolidating data and manually creating reports. This manual approach not only increases the risk of errors but also delays the availability of critical financial information.
Relying on outdated reporting tools and static reports also limits the ability to analyze data dynamically and gain actionable insights. Businesses need real-time access to financial data to identify trends, spot anomalies and make informed decisions promptly.
4. Limited Forecasting Capabilities
Without the ability to accurately predict future financial performance, businesses may find it difficult to plan effectively and make informed decisions. Forecasting methods often rely on manual calculations and simplistic models, which can be time-consuming and prone to errors. Businesses may struggle to incorporate various factors like market trends, seasonality or other external influences into their forecasts, leading to inaccurate predictions.
In the absence of a comprehensive view of historical and current financial data, businesses may lack the insights needed to identify patterns and trends that can inform their forecasts. This limited visibility can result in missed opportunities or inadequate preparation for potential risks.
5. Compliance and Regulatory Requirements
Meeting year-end financial reporting obligations can be challenging, especially for businesses operating in highly regulated industries. These businesses often face requirements that require meticulous attention to detail, accuracy and timeliness in financial reporting. Failure to comply with these obligations can result in severe consequences, meaning businesses must be able to navigate their complexities effectively.
7 Benefits of Using Power BI for End-of-Year Planning
1. Streamlined Data Consolidation
Gathering data from various sources, such as ERP systems, spreadsheets and databases can be one of the most challenging and time-consuming parts of financial planning throughout the calendar year. Power BI simplifies this process by providing seamless integration with these sources, allowing finance teams to consolidate data quickly and efficiently. This eliminates the need for manual data entry and reduces the risk of errors and inconsistencies.
By leveraging Acterys, organizations can seamlessly integrate data from different sources into one centrally managed Power BI platform, which has built-in reporting functionality that offers crisp and clean visual insights into a business’ various operations. Finance teams can source this data and use it to plan and forecast expectations for the next 12 months.
2. Comprehensive Financial Analysis
Power BI’s robust analytics capabilities enable finance teams to perform in-depth analysis during the year-end financial planning process. They can easily analyze revenue, expenses, profitability, and other key financial metrics to gain a comprehensive understanding of the organization’s financial health. This helps identify areas for improvement and supports data-driven decision-making.
The platform’s ability to integrate with various data sources allows finance teams to access a holistic view of the organization’s financial health. This comprehensive analysis enables finance teams to identify areas for improvement, such as cost-saving opportunities, revenue growth potential or operational efficiencies.
Business leaders can make data-driven decisions that are grounded in a thorough understanding of the organization’s financial performance. They can identify areas of strength and weakness, prioritize strategic initiatives and allocate resources effectively as they create an annual plan to drive business growth and profitability.
3. Scenario Planning and Forecasting
Scenario planning and forecasting features from Power BI enable finance teams to simulate different scenarios and evaluate their potential impact on the organization’s financial performance. Year-end planning typically involves creating financial forecasts and assessing different scenarios for the upcoming year, and these features enable teams to simulate scenarios, such as changes in market conditions, pricing strategies or cost structures.
Power BI can forecast key financial metrics such as revenue, expenses and profitability by applying advanced algorithms and statistical models. These forecasts provide valuable insights into the organization’s expected financial performance in the upcoming year, helping finance teams make informed decisions and set realistic goals.
4. Collaborative Planning Process
With Power BI, finance teams can create and share reports, dashboards, and insights in a centralized platform. This eliminates the need for manual sharing of spreadsheets or documents, reducing version control issues and ensuring that everyone has access to the most up-to-date information.
Year-end financial planning often requires collaboration among multiple stakeholders, including finance teams, department heads and executives. Power BI facilitates collaboration by providing a centralized platform where users can add comments, annotations and discussions directly within the reports and dashboards, allowing for real-time collaboration and an opportunity to share good ideas. This promotes transparency, enhances communication and ensures that all stakeholders are aligned in their planning efforts.
5. Real-Time Monitoring and Adjustments
Power BI’s real-time data capabilities allow finance teams to monitor financial performance throughout the year-end planning process. They can track key metrics, identify any deviations from the plan, and make timely adjustments as needed. This agility ensures that the organization stays on track and can respond quickly to changing market conditions or business priorities.
One of the perks of having our agile app in place is that it gives businesses the ability to rapidly adjust forecasts and financial portfolios in one centralized location, which has a two-fold effect: On one hand, it enables better and more insightful decision-making for financial planners and business leaders, giving them the best insights they can find.
On the other hand, the overall planning and budgeting periods of financial planning teams are cut significantly during a time of the year when your staff likely wants as much time off as possible.
Remember that even though the financial planning period may end this month, finance teams must continuously track this data. The great thing about our application is that once this data is synced onto a single version of the truth. Planners can access this information throughout the year through an attractive front-end that allows them to track the progress of goals. If it’s necessary during the holidays, you can connect quickly with the mobile app.
6. Data Visualization for Presentations
Interactive visualizations and dashboards make it easy to communicate financial insights to stakeholders and decision-makers. Finance teams can create dynamic reports and visualizations that highlight key financial metrics, trends and patterns. These visual representations not only enhance understanding but also facilitate discussions and collaboration among different departments or teams involved in the end-of-year planning process.
Year-end financial planning often involves presenting financial data and insights to executives, board members or other stakeholders. Power BI’s visualization features enable finance teams to create compelling and interactive presentations that effectively communicate financial performance and forecasts. This enhances the clarity and impact of the presentations, facilitating better understanding and decision-making.
7. Data Security and Governance
Power BI allows finance teams to define access controls and permissions, ensuring that only authorized users can access and interact with sensitive financial data. This is especially important for end-of-year planning, as it can involve handling a substantial amount of sensitive financial data.
Administrators can set up role-based access controls, granting different levels of access to different users based on their roles and responsibilities. This ensures that sensitive financial information is only accessible to those who need it, reducing the risk of unauthorized access or data breaches.
In addition to access controls, Power BI provides auditing and monitoring capabilities that allow finance teams to track data usage and monitor user activity. This helps identify any suspicious or unauthorized access attempts and enables timely intervention to mitigate potential risks. Finance teams can also leverage Power BI’s data lineage and data protection features to maintain data integrity and ensure compliance with data governance policies.
How to Save Time On Your End-Of-Year Planning
This may not be the most conventional way of thinking about data-sharing, however, using a collaborative tool like Acterys can dynamically bring your organization and its various departments together. After all, one of the most taxing aspects of planning is bringing all these departments, and their data together.
Sharing spreadsheets across departments isn’t coherent and results in highly inefficient and inaccurate collaboration. This lack of interdepartmental cohesion results in companies having to revise their plans and forecasts so many times. Unfortunately, this remains true throughout the year — not just in the planning phase.
However, with Acterys in place, our clients have been able to synchronize their entire organization, spanning multiple departments and providing them with collaborative insights of their own. By having decentralized management on a centralized data platform, your entire organization will have valuable insights and forecasts exactly the way they need it.