Best (and Worst) Practices in Budgeting and Forecasting: The Story of a Successful CFO

© 2011 Alight Planning Slide 1

Best (and Worst) Practices in Budgeting and Forecasting: The Story of a Successful CFO

Featuring: Arlin Hall, CFO, Texas Blood and Tissue CenterLisa Torbin-Shaw, Director of Financial Planning Solutions, Alight

Moderated by Ben Lamorte, VP Marketing, Alight Planning


Ben Lamorte Business Activities

Vice President, Marketing & Sales, Alight Planning Principal, Decision Consulting (Adobe, Kaiser) Manager, Business Intelligence, planetrx.com Management Consultant, APM/CSC Healthcare

Today’s Moderator

Publications Author of 2 research papers, American Mathematics Society Co-author of planning white papers

Education MS Engineering, Stanford University BS, Engineering & Math, UC Davis


Polling #1

Which best describes your experience with ASMI FP&A In-Person Training Events?

1. Attended an ASMI event in the past

2. Have not attended ASMI live event…but want to!

3. Attended an FP&A event but not ASMI

4. Not sure/why are you asking?


Oct 27th Fun Agenda

Part 1 Set the Stage (Ben) Planning Maturity Curve Framework Question #2 Worst Practices and How to Avoid

Part 2 Adventures with Budgeting Software (Arlin & Lisa) Life before Alight Life with Alight Question #3 Best Practices Presentation

Part 3 Q&A and Wrap Up (All)


Business Value from Planning

Insights Understanding things we didn’t see before

Actionable Knowledge Understanding and acting upon operational drivers

Decisions Planning scenarios gives us the financial impact of

choices Having choices sets up decision making


The Planning Maturity Curve

Budgeting

Forecasting

Reporting

Effort

Business Value

Budgeting& Reporting

Forecasting

Scenario Analysis

Agile Planning


Polling #2

What best describes your budgeting and forecasting technology:

1. Happy with spreadsheets.

2. Not happy with spreadsheets; considering a software tool.

3. Purchased software, it failed; we’re back in spreadsheets!

4. Purchased a software tool, it was a success!


Part 2: Why Budgeting Software Fails?

For Ben’s In-Depth Analysis of Software Failure FOCUS Research Brief:

www.focus.com/briefs/why-budgeting-software-fails-and-what-do-about-it/

Sid Ghatak, President of Rolling Forecast Solutions and Senior ASMI Fellow Instructor for ASMI Rolling Forecast

Podcast Featuring Sid Ghatak: www.focus.com/roundtables/avoiding-business-

performance-mangement-software-failure-4-t/


#1 Worst Practice: Software on the Shelf

Situation: Management thinks buying software licenses for everyone will somehow get everyone more involved and create a culture of collaborative budgeting.

Problem: Buttonwood Group Survey examined 100 companies who deployed budgeting software to replace spreadsheets:

44% of companies reported complete failure to get anybody outside of Finance to actually log into the system in the past 12 months.

How to Avoid: Start with a “Minimal Configuration” ADD Non-Finance USERS LATER!


#1 Software on the Shelf

Source: Planning Software Usability Survey By Buttonwood Group


Worst Practice #2: Go over your budget!

Problem (Quote below from real customer interview!) “Our software will be just $2,000. We forgot to tell you it costs $10,000 for

consulting help to build your model – oh yeah, it’s really easy to use. Of course, that’s just to get you going, it could take $18,000 for it to be fully deployed.”

How to Avoid (Send me an email with other ideas) Build discounts into pricing if vendor goes over the price!

Example: “Great! So, if we do in fact pay $10,000 upfront for the 50 hours, can we get a bill-rate of $100/Hr thereafter if additional consulting is requested? After all, it is unlikely we will need more than 50 hours.”


Worst Practice #3: Wrong Consultant

Problem A month after you buy software, you find out you’ve been assigned to a

consultant who's built one model as practice and recently completed an MBA degree!

How to Avoid Do not agree to purchase any software until you’ve at least met the

consultant assigned to your project. If you don’t click with your consultant, the project may be doomed from the start .


Lisa Torbin-Shaw Business Activities

Director, Financial Planning Solutions at Alight Hyperion Planning Consultant, Apogent Tech Product Management, Hyperion Solutions Principal Consultant, Hyperion Solutions Built the Alight model with Arlin!

Today’s Speaker

Publications Author of Planning at the Business Unit Level White Paper

Education BS, Accounting Simmons College CPA, Inactive


Arlin Hall

Business Activities CFO at The Blood and Tissue

Center of Central Texas for 21 years

30 Years in Healthcare Finance Budgeting, Forecasting,

Performance Management Built the Alight model with

Lisa!

Today’s Speaker

Education BS, Idaho State University CPA


• Created by the Travis County Medical Society in 1951

• Tissue Division created in 1988

• Serves 10 county area in Central Texas

• Affiliated with:• Travis County Medical Society• TCMS Foundation• Medical Service Bureau


History of Budgeting & Forecasting

1991 - Paper!!1992 - Lotus 123 / Excel2004 - Prophix2005 - Excel2008 - Microsoft Forecaster2010 - Alight Planning

Lived happily ever after


Our view of Key Best Practices with Alight planning

1. Flexibility of a spreadsheet without the inherent pitfalls

2. Driver (Statistics) driven

3. Ease of scenario modeling – What Ifs

4. Timeframes & comparisons with actuals

5. Ease of rolling forecasts


Polling #3

If you’ve ever failed with a software implementation – what was the primary reason for the failure:

1. Non-Finance users never really used it.

2. Went over budget and/or took too long to “go-live”.

3. Consultant did not work out (was a bad match etc.)

4. Other (Send Ben an Email and you may be featured in an article!)


ASMI’s Customer Loyalty Offer

Rolling Forecasts TrainingDecember 12th-14th, Washington, D.C. (ASMI Training Facility)

Why should you attend? So you can….•Obtain the solutions to integrate Rolling Forecasts into your management•Discover how leading companies have supplanted their budget process with Rolling Forecasts•Learn the positive effect of Rolling Forecasts on operational performance.•Identify the proper path to take when fostering buy-in for Rolling Forecasts•Gain Entry for $999 (normally $1,799)

If you have would like to register or have questions,

please don’t hesitate to contact me.

Andrea DiRaddo

[email protected]

202-739-9601


Resources Why 1 in 3 Budgeting Software Projects Fail

FOCUS Research Brief: www.focus.com/briefs/why-budgeting-software-fails-and-

what-do-about-it/ Sid Ghatak, President of Rolling Forecast Solutions, Senior ASMI Fellow

Podcast Featuring Sid Ghatak: www.focus.com/roundtables/avoiding-business-performance-

mangement-software-failure-4-t/

Follow up with Alight Email: [email protected] Call Ben at: (415) 456-8528

Free Resources

Best (and Worst) Practices in Budgeting and Forecasting: The Story of a Successful CFO

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