Harvard Business Review Analytic Services Study: Modern Planning Tools Boost Agility
A new report uncovers a divide between the modern planning tools that organizations want and the ones they have—but also finds growing efforts to bridge the gap.
Supply disruptions, demand fluctuations, labor shortages, and price hikes: The COVID-19 pandemic spurred an era of uncertainty that caught many organizations unprepared. With the pandemic’s onset, organizations around the world suddenly had to rethink their operations and planning. Almost three quarters (72%) of surveyed business executives say the pandemic significantly altered their business plans, according to “Organizational Agility Requires Modern Planning Tools,” a recent study by Harvard Business Review Analytic Services in association with Workday.
By and large, business leaders agree on their enterprise planning needs in today’s fast-changing world. At least 80% of the 288 surveyed executives rate the following attributes as highly important for enterprise planning: flexible/adaptable, continuous, data-driven, collaborative, and scalable planning.
But the report identifies a major disconnect between the planning attributes that organizations want and the ones they have. While 91% of respondents describe data-driven planning as highly important, only 47% say their organization’s planning is data-driven to a great extent. And while 88% say flexible and adaptive planning is highly important, only 40% consider their planningflexible and adaptive. Instead, many continue to rely on traditional and inflexible tools such as spreadsheets.The report explores this gap and how businesses are closing it.
Minding the Gap
Business leaders face a slew of challenges with their current enterprise planning. According to 60% of executives, their processes are too manual and slow—the most common planning challenge. Other top hurdles include:
- Lack of talent with knowledge of modern enterprise planning.
- Not enough engagement and ownership among stakeholders.
- Tools that are not flexible enough to adapt to operational changes.
- Bad data or multiple versions of the truth.
Almost three quarters (72%) of surveyed business executives say the pandemic significantly altered their business plans.
Even though the challenges of traditional planning tools have become quite clear, a decisive majority of organizations (62%) continue to use them.
The good news? Business leaders realize their current approaches to planning are no longer sufficient, and they are making changes that span people, processes, and technology.
Among respondents:
- 55% have updated their planning tools.
- 50% have revised their overall planning approach and strategy.
- 38% have adjusted the people involved in planning.
- 33% have increased the frequency of their forecasting to support faster decision-making.
Notably, these business leaders expect to continue modernizing in the months ahead. Almost 3 in 5 respondents (58%) plan to increase investment in enterprise planning tools over the next 12 months. And 80% say they intend to increase their use of advanced planning tools.
An overwhelming majority (92%) of executives using modern planning tools report realizing positive business outcomes, including improved agility, alignment, and insight.
What do business leaders say they want out of their planning toolkits? Tools that are “more automated and less manual, better integrated with systems of record, more intelligent and predictive, more flexible, more visual, and driven by real-time data.”
Reaching for the Future
While there’s a heavy dependence on traditional planning tools such as spreadsheets and manual forecasting models, there’s also a clear consensus on the value of modernizing those tools. Almost all respondents (91%) say that modern planning tools can help them be more flexible and adaptive in their enterprise planning and can help them drive growth with smarter resource allocation, and 85% say they can help organizations like theirs hit financial targets.
Many organizations have already started to reach for the future—and gain a business advantage. An overwhelming majority (92%) of executives using modern planning tools report realizing positive business outcomes, including improved agility, alignment, and insight.
Business leaders see significant gaps between the enterprise planning they have and the one they want and need, the report finds. While many leaders still rely on outdated and inflexible planning tools,the survey also uncovers a positive trend: Businesses are well aware of their shortcomings with enterprise planning and more are adopting modern planning tools.
Read the full report to learn more about how modern planning tools can help enable organizational agility.
To Plan Better, Close Smarter
A modern close process can accelerate business agility and create a frictionless, collaborative environment for accounting and financial planning and analysis (FP&A).
Accelerating the Digital Finance Journey: A Four-Step Framework for Value Creation
The enterprise management cloud can help organizations remove friction in their finance processes to achieve greater efficiency and add enterprise value. Workday’s Barbara Larson lays out the process.
More Reading
-
Workday Podcast: How Vertex Modernized Its ERP System to Fuel Rapid Growth
Digital transformation gave the global tax and compliance provider unprecedented insight into its data. In the process, the organization also leveled up its finance and accounting teams to provide greater value for the business.
-
Workday Named a Leader in the 2024 Gartner® Magic Quadrant™ for Financial Planning Software for Third Year in a Row
We’re honored to once again be recognized as a Leader in the Gartner® Magic Quadrant™ for Financial Planning Software for our completeness of vision and ability to execute.
-
How 4 Factors Power Robust Growth: Leaders Reveal Their Organizational Success Secrets
A solid strategy, an emphasis on customer satisfaction, and having the right people in the right roles are just some of the elements that set companies up to maximize shareholder value. Executives from Palantir, Palo Alto Networks, and Snowflake share their insights.
