Legal Industries, Real Estate, Uncategorized

Why Not Having a Strong Financial Planning & Analysis Function Could Sink Your Company

Many businesses overlook a critical aspect for success: financial planning and analysis (FP&A). FP&A combines financial planning, budgeting, forecasting, and analytics to help companies make strategic decision-making, align with their financial goals, and create a clear path to business growth. Without a strong FP&A, your business operates blindly, increasing the risk of costly mistakes.

What Are the Consequences of Poor FP&A?
Poor financial planning and analysis can have dire consequences for businesses of all sizes. It can lead to: 

  • Cash Flow Crises
    Inadequate FP&A can result in cash flow problems, making it challenging for businesses to meet their financial obligations and invest in growth opportunities.  
  • Inability to Adapt to Market Shifts
    Without accurate financial insights, companies may struggle to respond effectively to changes in the market, potentially losing market share and profitability.
  • Misallocation of Resources
    Inefficient allocation of resources can occur when companies lack a clear understanding of where their financial strengths and weaknesses lie.
  • Loss of Investor Confidence
    Investors and stakeholders rely on financial data to make informed decisions. Poor FP&A can erode their confidence in your business.
  • Costly Mistakes
    According to a report by DataRails, the poor use of FP&A costs companies around $7.8 billion annually in the United States alone. 

Why Do Many Businesses Lack FP&A?
So, if it is THAT important, why do many businesses lack it? Small to medium-sized enterprises hesitate to establish an FP&A function since it is perceived to be too COMPLEX and extremely EXPENSIVE. But a robust FP&A function shouldn’t be seen as a luxury; it’s necessary for business survival and growth.

How Can Businesses Avoid These Challenges?
The good news is that there are plenty of ways to solve problems that stem from poor or lack of FP&A. Here are some examples:  

  • Automate Data Imports
    Set up the automation of data imports from your preferred accounting software. This is to ensure the accuracy of data transfer and the elimination of time-consuming process of manual data entry.
  • Advanced Financial Models
    Develop advanced financial models to help you project revenues, expenses, and profits easily and accurately, allowing for better financial planning.
  • Resource Optimization
    Optimize your company’s resource allocation so you can ensure that each dollar spent is maximized and contributes to the profitability of the business. 
  • Real-Time Dashboards
    Develop real-time dashboards and charts to provide instant access to key financial insights, KPIs, trends, and errors. Having this information in one place will enable you to create better and more accurate business decisions.
  • Task Automation
    Utilize tools to automate repetitive tasks will save you time and reduce the risk of errors. There are plenty of available platforms you can leverage such as Excel to automate data entry, calculations, and report generation with its built-in programming language called VBA that allows you to create macros. You can also explore Microsoft Power BI, Tableau Server, or business intelligence platforms for scheduling and automating report distribution via email or web portals.

These are not simple tasks to do, that’s why you need a reliable financial analyst to help you execute a strong FP&A function. 
At Satellite Teams, we have full-time remote financial analyst professionals who are trained and experienced in financial planning and analysis. Our number-crunching rockstars will help you build a robust FP&A function so you can create a better future for your business.  

Don’t let a lack of financial planning and analysis sink your business. Reach out to us today to discover how our remote financial analyst rockstars can help you transform your FP&A to the next level.  

Got any questions?
Consult with our team today!

Got any questions? Consult with our team today!

Got any questions?
Consult with our team today!

Got any questions? Consult with our team today!

Explore Our Blog Posts

Read up on informative articles about emerging industry trends, business tips, entrepreneur insights, and more!

Ways To Deal With The Paralegal Talent Shortage

Personal injury law firms are finding themselves short on skilled paralegals because of the current state of the US economy and post-pandemic effects to the industry. You are not alone! Everyone's feeling the talent crunch.

Crisis To Opportunity: Ways To Future-Proof Your Personal Injury Law Firm

Being in business for years, I’ve learned that crises are inevitable in any venture. Challenges such as economic downturns, competition in the labor market, mass resignations.

How Are Successful Management Companies Leveraging Remote Talent?

Let’s face it—we are in a digitally-driven world where the traditional staffing model is no longer the only option for companies to expand their team’s capacity. And with the rise of technology management.