Planning, Budgeting and Forecasting
Translate your strategy into plans, budgets and forecasts
Planning, budgeting and forecasting are three important pillars of Deloitte’s Integrated Performance Management framework. One of the biggest objectives of this framework – which many companies however tend to struggle with – is that strategy has to be effectively translated into long-term plans, mid-term budgets and short-term forecasts in order to make sure that strategic objectives are met, financial targets are reached and shareholder value gets created in a proper and sustainable manner.
Effective Planning, Budgeting and Forecasting (‘PBF’) practices include four major axes:
- Strategy – What business are we in? How will we compete? Which choices will create the most value for our shareholders?
- Planning – How will we align resources with our strategy? How will we measure our performance and progress?
- Budgeting – How will we ensure accountability and encourage behaviors needed to execute the strategy?
- Forecasting – How will we adjust to reflect changing conditions?
Over the past few years, Deloitte has developed considerable expertise in Planning, Budgeting and Forecasting by constantly adjusting best practices with the lessons learnt at clients.
Deloitte has developed the following four steps approach to handle Planning, Budgeting and Forecasting project implementations. This approach is tailored to client needs at the beginning of each PBF project.
- Assess the client’s PBF capabilities across people, processes, and technology and highlight weaknesses within the organization as well as potential PBF enablers
- Define desired future state capabilities based on actual business needs and integrate them with best practices to come up with an ideal to-be situation
- Develop a project-based roadmap to achieve the future state and define the level of change management that would be required to move from one state to another
- Execute and manage the roadmap projects by implementing PBF tools from the most popular vendors on the market, including Oracle (Hyperion), IBM Cognos and SAP BPC
Clients who have strong PBF practices in place can enjoy multiple important benefits:
- Increase transparency and quality of budget figures
- Increase speed of PBF activities (data collection, reporting, etc.)
- Increase quality of decision-making due to more accurate data
- Stimulate plan/budget commitment of the various stakeholders
- Clear audit trail of all changes is preserved at all times
- Stimulate positive insight