23 November 2017
In 21st century business, the savviest organisations are using Integrated Business Planning (IBP) to inform their operational strategies, with the finance teams wielding a crucial role in IBP’s successful implementation. In this blog, we explain why finance is so integral to the improvement process, and how its entrenched in business.
Having transitioned from its predecessor, Sales & Operations Planning (S&OP), IBP includes far more robust financial integration. This not only requires careful thought, but an entire re-evaluation of how the finance group interacts with the rest of the organisation, with the most success seen in organisations with a deeply integrated finance community.
Finance is tightly incorporated into the IBP process, allowing the department to become highly involved in crucial decision-making processes and ensuring that the financial impact of those decisions are clearly understood. In today’s business world, the ‘finance people’ are no longer simply the recorders of information, they’re integral to the future planning of an organisation’s success.
As well as a major enabler of successful IBP, the role of Finance Business Partner has now evolved to become a crucial in market-leading organisations, with key roles described as ‘collaborators’, ‘facilitators’ and ‘custodians’ by the CFO of a leading company. The finance team are carefully and strategically embedded into the organisation, placed in different departments of the company – see figure 1.
By dispersing the team across the organisation, the finance function is tangibly involved in the individual departments, promoting collaboration and encouraging familiarity with the everyday on-goings of the business. They can see first-hand the detail of the business, and are no longer viewed simply as ‘the bean-counter’. It’s a great structure from which to build the finance roles that will make IBP work most effectively.