3 Steps to Select the Best FP&A Software Tool for 2024

In today’s ever-changing, hyper-competitive business landscape, agility sets thriving organisations apart from merely surviving ones.  

With less time and increased pressure to make critical financial and operational decisions, many businesses are shifting from traditional static planning to dynamic continuous planning that provides data-rich, real-time insights, empowering finance leaders to pivot from analysis to action in just a few mouse clicks.  

The backbone of any organisation’s financial planning & analysis is FP&A software—ideally, a cloud-based solution that supports a single source of truth across the entire enterprise. Why? Organisations looking for a competitive edge today—and tomorrow—can no longer rely on outdated, error-prone spreadsheets or siloed on-premise software solutions that don’t provide full operational visibility.   

When it comes to FP&A software, there is no shortage of solutions on the market that promise out-of-the-box integration and a user-friendly interface. But which one is right for your organisation’s unique needs? Keep reading to learn about the features of top FP&A software tools and how they can meet your strategic goals.

1. Optimising FP&A: Understanding and Effective Use

For decades, financial planning was a largely retrospective process. Finance teams reviewed the past year’s performance to set goals and budgets for the year ahead. But as the marketplace has expanded globally and the pace of business has quickened, FP&A trends have also evolved. And once-a-year planning that relies on stale data is no longer good enough.

The more holistic FP&A process—planning, forecasting, budgeting, and analytics that support financial and strategic imperatives—is now the gold standard. Organisations that succeed in this process follow similar FP&A best practices, including:

• Establishing a single source of truth. For true cross-department collaboration, all internal stakeholders—finance, HR, operations, marketing—must have access to the same data. Yet, a PwC survey found that up to 80% of FP&A tasks are often conducted, at least in part, in offline databases and spreadsheets, creating data silos. By leveraging a cloud-based system, organisations can house their data in a secure, accessible location while reducing time spent inputting or updating data by hand. 

• Setting controls. By establishing controls and approval processes upfront, businesses can ensure the veracity of their numbers and resulting forecasts and budgets. 

• Incorporating data from across departments. Accounting and finance data alone paint only a partial picture of an organisation’s operations. Indeed, a recent Workday CFO Indicator study found that 51% of CFOs increasingly rely on non-finance data (ESG, customer information) to help make decisions. By incorporating data from areas such as HR and operations, finance leaders can bust long-standing silos and get a more complete strategic snapshot. 

• Enabling self-service. Empowering stakeholders from across the organisation to run their reports and analytics reduces IT requests, freeing up IT’s time for more value-add tasks. 

2. Selecting the Ideal FP&A Software

Choosing the right FP&A software is a very individual process. Even operations of similar sizes and business models may thrive with widely different solutions based on their internal workflows. When selecting an FP&A platform for your organisation, keep these key factors in mind:

• Cloud-based. Unlike legacy systems in which the software runs on local servers, a cloud-based system creates a single source of truth accessible to all stakeholders across the organisation. Cloud-based systems also shift the onus of technical and infrastructure investment to the provider, freeing finance leaders from system management and allowing employees to make changes without assistance from IT.  

• User-friendly. For companies truly committed to enterprise-wide planning, a system intuitive for non-technical employees is imperative so as not to invest weeks in training—or worse, purchase a system that few people ultimately use. 

• Scalable. Your software solution needs to address multiple levels of scale. First is the overall size of your organisation. You may be a nimble 25-person operation today, but with a growth mindset, you likely won’t stay that lean forever. Your FP&A platform needs to grow along with your headcount, supporting users not just in finance but across all departments. The second type of scale is diversity and dimension of metrics. Traditional planning centred on financial planning only. But with an enterprise-wide approach, the type of metrics you need will expand. 

• Automation. In the coming years, predictive intelligence, including automation and machine learning, will be increasingly critical for transformative growth, so the FP&A system you choose needs to have those functions already embedded. A built-for-purpose planning system with AI and ML functionality not only will help you automate repetitive processes—freeing up staff for more strategic tasks—but also will help aid planning by identifying patterns and problems and running business simulations. 

• Cost effective. When it comes to integrated financial planning, it’s wise to decide how much software you need. While scalability is key, if your 10-year business plan caps your headcount at 100, you probably don’t need to purchase a system for global businesses with thousands of employees. On the flip side, if you’re experiencing sticker shock over the initial cost of a system that is just your size, consider the total cost of ownership of the software over its lifespan—and remember that it’s an important investment in your company's future. 

3. Key Errors to Avoid When Choosing FP&A Software

Now that you know what to look for in an FP&A platform, here are a few key errors to avoid when purchasing: 

• Neglecting to assess specific needs. Understanding the specific demands of your FP&A process before selecting software is essential. For instance, if workforce data is a key financial planning metric for your organisation, your chosen system will need to support HCM integrations.  

• Underestimating data security. Forsaking data security can expose your company to data breach risks, which are becoming increasingly common and affect customer trust. 

• Not consulting end users. End-user feedback can reveal critical aspects of the software you might not have otherwise considered.

• Neglecting customer support. Ensure the provider offers excellent post-sale service to address customer issues and answer questions promptly as they arise.

• Forgetting about customisation. Choose FP&A software that allows for adequate customisation to align with your specific FP&A processes and requirements. A system should work with your process, not force you to completely revamp your process.

• Not considering the future. Think about the evolution of technology and your company's long-term needs. Choose FP&A software that can adapt to these changes.

   

Conclusion

Choosing a best-in-class FP&A software system isn’t a one-size-fits-all affair. Every organisation is different—both in composition and objectives—and will need a platform that addresses its specific needs.

Workday Adaptive Planning is uniquely positioned to meet your business specifications, with a cloud-based system that creates a single source of truth to super-charge agility and foster future-first planning. Get your free trial of Workday Adaptive Planning, because the future of business is today.