Modern financial planning with the latest generation of tools is of enormous importance for the economic success of companies of all sizes. Conventional planning methods are often not flexible enough, especially for fast-growing companies. Today, it is more important than ever to be able to react quickly to current developments.
In times of agile management, Excel spreadsheets for the quarterly comparison of company figures with budgets and forecasts are no longer up to date. Better financial planning is required in order to be able to react dynamically to deviations such as changes in demand. However, even the best tool is only as good as its implementation.
In the following article, you can find out more about the benefits of financial planning with tools such as Jedox. As an official Jedox partner in Switzerland, we are your point of contact when it comes to implementing a modern financial planning strategy.
What is financial planning and why is it important?
Business financial planning is about planning a company's financial requirements in advance. The most important points to keep in mind are
The first step is to determine whether liquidity bottlenecks or a capital surplus are to be expected in the planning period. This planning can be particularly challenging for young, growing companies. After all, investment requirements and cash flow develop dynamically.
But even established companies, which today are often integrated into just-in-time production chains, have to make their financial planning increasingly dynamic. In practice, this means that budgets and forecasts are adjusted more frequently than in the past.
Which financial planning techniques and methods are best suited to your company?
Conventional financial planning methods only take into account financial process elements. These include, for example, profit and loss and cash flow statements, the balance sheet, sales and cost planning as well as investment and financing requirements. In many companies, this work is still carried out manually using countless Excel spreadsheets. This makes the process costly and error-prone.
Modern financial planning tools such as Jedox perform many of the previously manual tasks automatically. This makes financial planning easier to readjust.
More importantly, however, the use of modern financial planning tools also enables Extended Planning & Analysis (xP&A for short). This means that financial planning is no longer seen as a system isolated from the rest of the corporate strategy. Breaking down internal company data silos helps to incorporate data from different departments into financial planning.
Falling or rising demand, for example, first becomes apparent in the sales department. If this data is recorded and evaluated using xP&A, financial planning can react to it at an early stage. Other areas of the company, such as supply chain management or marketing, can also adapt to the changing situation in an agile manner.
How to create financial planning for companies with Jedox
At Consilix AG, we primarily rely on financial planning with Jedox, a tool developed in Germany. It is an extremely flexible corporate planning solution that allows planning both from scratch and on the basis of existing workflows. The latter means, above all, the possibility of importing and reusing Excel sheets.
The latter point in particular is a key feature for the developers of Jedox. Unlike many other financial planning solutions, Jedox does not deny the importance of Excel in a business context. Instead of wanting to completely replace the classic spreadsheet, the software works in tandem with it and offers a variety of additional automation features. Jedox data can also be obtained and processed directly in Excel.
In any case, financial planning with Jedox consists of three central points:
The first step in planning is to define the general corporate goals and determine how they are to be achieved. The development of the budget is based on top-down objectives and bottom-up knowledge of the specialist departments. It specifies which financial resources are available for which processes and tasks. More importantly, however, it creates a comparative framework against which the development of subsequent years can be measured.
Finally, with forecasting, Jedox makes it possible to dynamically map expected changes in business operations. Unlike traditional forecasting tools, Jedox can also evaluate data that has not yet been reflected in key financial figures. Thanks to advanced machine learning, algorithms and artificial intelligence, Jedox can, for example, forecast possible customer churn. As a result, financial planning can be adjusted to the expected cash flow.
A look at our references shows how versatile the technology is.
Prepare for unforeseeable events through financial planning and risk management
Jedox also impresses with the precision with which process dependencies are identified and put into relation. This applies in particular to the forecasting models and their realistic assessments of the business situation. The tool is therefore extremely valuable for financial planning and risk management. We will be happy to support you in implementing the technology in your company.
Do you have any further questions about the services we can offer you for financial planning with tools such as Jedox? Feel free tocontact us via our contact form or by phone. We look forward to getting to know you during a non-binding initial consultation.