What businesses should know before choosing the right cloud FP&A tool?

Imagine taking a trip to the store trying to find a good, fresh watermelon without going over budget. The problem is that you have no idea how to check for a good watermelon, and you might buy a rotten one. Since we can’t see the inside of a watermelon, some people take a leap of faith, buy whatever they think looks okay, and hope it tastes good. 

Sometimes, hope goes down the drain. You return home, anticipating eating the sweet watermelon, only to find the inside completely rotten. Here is your stake: you lost your last penny to a rotten watermelon you somehow had to throw away. 

But imagine if you went into the store and had done research on how to choose the best watermelon to ensure that it tastes sweet, so that your money is well spent. 

We can apply the same concept to choosing the right cloud FP&A tools. You have a business and plan to adopt a new system with zero knowledge. Here’s what you know: your business needs financial planning software that can cater to your medium-sized company. 

Importance of choosing the right cloud FP&A (Financial Planning & Analysis) tool for businesses

You want to spend your company’s budget to deliver a good return on investment (ROI). But you have always done the FP&A process manually and were doing fine. Why do you need it now?

Cloud FP&A tool is merely a tool. You can achieve more compelling wins by implementing cloud FP&A software in your company. Such as:

  • Streamlined financial processes: Cloud FP&A tools automate repetitive tasks like data entry, consolidation, and report generation, allowing your teams to focus on strategic activities such as data analysis and forecasting.
  • Enhances accuracy and reliability: Cloud FP&A software ensures more accurate reports and forecasts by minimising manual errors, leading to more confident decision-making. 
  • Provides real-time insights: Modern cloud FP&A tools offer features like data integration, predictive analytics, scenario modelling, and reporting capabilities that enhance the efficiency and effectiveness of the finance function.
  • Supports growth: Cloud FP&A solutions help businesses streamline their budgeting and forecasting process, track financial performance, analyse trends, and generate actionable insights that inform strategic decision-making.
  • Minimising costs: Investing in cloud FP&A software can be more cost-effective than having finance teams perform repetitive and manual tasks, which can be time-consuming and error-prone.

Key Considerations when selecting a cloud FP&A solution

“yeah, yeah, I get it”, says you. 

FP&A is important, and now you are fueled with great anticipation. It’s like waiting for your favourite TV show’s new episode every Sunday. 

So you set up a meeting with your FP&A teams, tell them about adopting a novel system that can further grow the company and boom—you become too overwhelmed with choosing the right tools. 

How do I choose? Who do I go to? What if I made the wrong choice? The puzzling questions continue. 

Understanding Your Business Needs

When choosing a cloud FP&A tool, aligning your selection with your company’s overall strategy and objectives is crucial. Firstly, it’s important to set clear financial goals for the short-term and long-term. Think about how this tool can help you achieve your growth plans, adapt to changes, and gain a competitive edge in the market. Keeping your business goals at the forefront ensures that the cloud FP&A software you choose will provide the necessary functionality and insights to drive your company’s financial success.

Evaluating Cloud FP&A Tool Features

When evaluating FP&A tool features, it is essential to consider a range of critical aspects to ensure the software aligns with your business needs and objectives. 

FP&A success hinges on powerful dynamic modelling and fundamental FP&A principles such as revenue, expenses, personnel, P&L, cash flow, and balance sheet reporting. Efficiency and accuracy are equally important, and can be achieved by emphasising the need for workflows, collaboration tools, and automation within the software to expedite task completion and enhance data consistency. 

The long-term value of an FP&A solution should be assessed. Look for platforms like Workday Adaptive Planning that offer automation, machine learning (ML) capabilities, broad integration options and customisable features to drive better business modelling and insights. 

Review of Cloud Migration Consultants 

Transition is never smooth sailing; we need time to adapt to the new environment. The same concept applies to transitioning from one system to a new system. Hence, the next crucial step in cloud FP&A implementation is the credibility of the cloud migration consultants. 

The fitting consultants will provide strategic guidance, technical expertise, and support to ensure your company has a velvety transition. If you want to implement cloud FP&A software, looking for a consultant who has successfully implemented similar cloud migration projects is important. What’s more noteworthy is for the consultant to be able to communicate complex technical concepts in a clear and concise manner. 

Another substantial point to note is to scrutinise consultants who offer support and training to help you and your team adjust to the new cloud environment rather than letting you navigate it on your own. For instance, Shearwater will provide support in every stage: the early implementation stage, during the implementation, and post-implementation. 

Scalability and Flexibility

When choosing FP&A software, consider its ability to scale and adapt as your business grows and evolves. Look for a solution to handle increasing data volumes and complexity without compromising performance. Assess the tool’s adaptability to changing business requirements, such as new reporting needs or integration with additional systems. 

The ideal cloud FP&A software should be adaptable to your company’s growth and evolving financial planning and analysis needs, guaranteeing that your investment continues to add value as your business expands.

Assessing User Experience and Support

The user experience of an FP&A tool is a critical factor to consider, as it directly impacts the efficiency and productivity of your finance team. Say the FP&A tool is hard to navigate, making it difficult for your team to adjust. Subsequently, the implementation decreases your team’s productivity rather than assisting them in achieving streamlined financial processes. 

Look for software with an intuitive interface and user-friendly design that minimises your team’s learning curve. A tool with a strong user experience and reliable support can help your team maximise the software’s value and ensure a smooth implementation process. 

Also, consider the quality of customer support and the consultant’s responsiveness to issues or questions that may arise while using the tool.

Calculating Total Cost of Ownership (TCO)

Cloud FP&A implementation can be a risky yet powerful investment. Calculating the total cost of ownership (TCO) when selecting an FP&A tool is crucial to understanding the complete financial impact over the tool’s lifetime. TCO includes the initial licence fees or subscription costs, implementation and training expenses, ongoing maintenance and support costs, and any hidden or unexpected fees. 

By thoroughly evaluating all direct and indirect costs associated with the cloud FP&A software, businesses can make informed decisions and select a solution that provides the best value for their investment.

Cloud Implementation Time 

When evaluating the time required for implementing cloud FP&A software, it is vital to assess the anticipated duration of the implementation process. Understanding the time required for deployment, configuration, training, and data migration is like a backbone to minimise disruptions to business operations. 

Adequate planning and resource allocation can help ensure a smooth transition to the new FP&A software without significant downtime or delays in accessing critical financial data. Moreover, evaluating the availability of resources and expertise for successful implementation can contribute to the timely and effective deployment of the chosen FP&A solution.

Conclusion

In conclusion, just as with selecting the perfect watermelon, choosing the right cloud FP&A software for your business requires research and knowledge. You wouldn’t want to invest your resources into a system that doesn’t meet your needs, much like you wouldn’t want to spend your last penny on a rotten watermelon. 

Therefore, understanding the features, scalability, and support that different FP&A software offers is crucial to ensuring that your investment enhances your business operations and growth – ensuring that your business is equipped with the best tools to achieve its financial goals.

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