You often read about one of the biggest business challenges: different business units working in silos. Business partnering is considered one of the means for overcoming it. Last week I found an excellent example of a solution. I joined an FP&A Board meeting organized by FP&A Trends and sponsored by Michael Page, AnaPlan, and Page Executive. During the meeting, a large group of CFOs of large multinational companies discussed the definition and approach to Integrated FP&A (Financial planning and analysis). I am not a CFO; I am a data management practitioner. Two topics drew my attention because they were directly related to data management.

These two topics were:

  1. The role of data in ‘Integrated FP&A.’
  2. The key steps in the implementation of Integrated FP&A.
The role of data in ‘Integrated FP&A.’

The participants of the FP&A Board were asked to specify in one word their vision of FP&A integration. The most striking for me was that about 30% of answers were related to data. These answers included such phrases as ‘data integration,’ ‘data quality,’ ‘data availability,’ and‘ one source of truth.’ These phrases are present in daily conversations of data management professionals. The fact that top finance professionals consider data as one of the critical success factors in FP&A shows a growing understanding of the role of data in overall business success. This was the first example of a potential business partnership between finance and data management.

The second one was even more exciting.

 The key steps in the implementation of Integrated FP&A

The participants worked in small groups to create a presentation of their vision on some topics related to Integrated FP&A. I joined the group that identified the key steps in implementing Integrated FP&A. During the discussion, I explained my vision on the role of information and data in the business lifecycle that has been published in my books (The Data Management Toolkit and The Orange Model of Data Management) and a few of my articles (‘FP&A from Einstein’s perspective’ and ‘FP&A and the three-headed serpent’). At the same time, while explaining my vision, I noticed that I was describing a method of implementation of data management in any company. To my great excitement, my group decided that this approach matches the key steps required to implement Integrated FP&A.

So, let me briefly show you this 6-step approach for building Integrated FP&A.

Figure 1. Building Integrated FP&A in 6 steps.


Step 1. Specify the vision and ensure the buy-in of top-management
The key business value of the Integrated FP&A is the support of the decision-making process. First, the company should understand which key business decisions require improvement. This is also the main ‘selling point’ to getting the support of top management in this initiative. Clear expectations will assist in specifying a feasible scope of the initiative. Decisions are made based on information.

Step 2. Specify the required information
Management at different organizational levels would require different information to support their business decision. The system of KPIs could be one of the main deliverables of Integrated FP&A. A clear understanding of information requirements is one of the essential steps and success factors for the PF&A initiative. For specific information, relevant data should be gathered and delivered.

Step 3. Define and deliver the required data
Finding and delivering required data often costs time and requires much effort from data management and IT professionals. The limitation of data delivery to the scope of required information allows for optimizing the scope of the Integrated FP&A initiative. From the FP&A perspective, data represents business drivers. The definition of the key business drivers is the exercise that requires combined efforts of data and FP&A professionals. To transform data into information, the data transformation process should be optimized.

Step 4. Optimize data and information value chain
The data and information value chain is a set of activities that support the transformation of raw data into meaningful information. Data integration and aggregation are examples of data transformation. These two types of data transformation may be the most important for Integrated FP&A. Data transformation should be supported by relevant business processes.

Step 5. Optimize business processes
Business processes describe actions and deliverables that people in different departments across the organizations should perform to achieve the expected results of Integrated FP&A. This is a crucial step to setting up a proper collaboration between various FP&A business stakeholders and partners. In this step, communication and business partnering come onto the scene. When information and data requirements and the required processes are specified, is it time to identify which systems can support the Integrated FP&A?

Step 6. Specify the required system support
There are two common mistakes often made in IT-related projects. The first mistake is choosing the system before the clear specification of business and data requirements. Any system is only a container of data and a ‘smart calculator’ that processes data into information. You don’t need a Mercedes to buy groceries at the nearby shop. The same is the case with systems. You should first clearly understand what kind of functionalities you require. It will allow you to optimize resources spent on implementing Integrated FP&A.

The second mistake is thinking that IT owns the project and is accountable for the initiative’s success. The IT function can only support business and finance departments in delivering results. Business is accountable for a clear specification of the scope and expected deliverables. Business should be the leading force in any business-related system’s implementation and testing process.


The above topics show the excellent opportunity for closed collaboration and business partnering between data management and FP&A.

Getting your professional opinion on your experience concerning the Integrated FP&A and data management implementation would be very interesting. Please share your thoughts in the comments section below!

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