Why Now Is the Time to Embrace Smart Budgeting Technology

Most organizations want the same things: a stronger bottom line, the ability to make the right decisions quickly and an effective method to get it all done.

It sounds fairly straightforward, right?

Unfortunately, it's not quite as simple as it might seem. Today many organizations continue to struggle with budgets and forecasts. They see cash flow issues (which threaten the health of the business) and are slow to react to both challenges and opportunities.

Yet, many businesses still aren't adapting to change. Traditional budgeting and forecasting tools, such as spreadsheets, are still used by many organizations. This leaves these businesses struggling to overcome outdated systems, complex algorithms and productivity issues.

At the same time, better solutions are available. Technology has brought us ways to apply superior strategic approaches to budgeting and forecasting. With automation, CFOs have seen the potential for all the new data they can use to project and predict business health.

But the key isn't simply automation in general. It's about using 'smart' technology. This technology harnesses the most powerful aspects of automation and applies it exactly where CFOs need it—the budgeting and forecasting process. These new 'smart budgets' solve many common problems CFOs and budget managers face in budgeting and forecasting.

In this post I want to share with you why smart budgeting and technology can improve business operations. And why this approach is going to be key in the years ahead.

Increased Accuracy and Productivity

Inaccuracy can kill most budgets before the new quarter has even rolled around. Relying on data that is wrong costs businesses millions each year in poor decision making. After all, how can you ensure you're hitting projections if you're not even sure the data is correct?

Every budget manager and CFO knows this and the many hours that go into producing a budget and forecast each year. In fact, many employees in accounting and finance departments spend far too much time on data entry, finding broken formulas and tracking down information.

This is lost labor. And the effects of it mean lost time and productivity, which translates to the bottom line. Employees should spend their time working to improve business processes, spot opportunities and contribute to strategy, not searching for data.

With the right automated systems in place, roles can be improved. The finance team can spend their time supporting CFOs who are playing a bigger role in decision making for the organization.

Better Budgets and Forecasts

Budgeting and forecasting are crucial organizational tools from both financial and strategic perspectives. Yet many organizations are using outdated methods and models. We saw how the traditional methods could lead to inaccurate data and a loss of productivity. No doubt you’ve seen it too.

At the same time, there are bigger problems for the organizations that can't keep up with the pace. Having an outdated budget (and budgeting system) is a massive problem for the overall financial health of a business.

This is where employing 'smart budgeting' technology can pay dividends. Utilizing an automated tool that pulls in data continuously is one thing. However, having a system that does that and has built-in business logic and accounting rules can take budgeting to a new level.

The same can be true for forecasting. With so much data available, finance and accounting departments should have planning systems that include reforecasting and what-if scenarios. These strategies allow for organizations to become more agile and react to changes in the market quickly.

More Collaboration

Businesses are increasingly looking to have a more collaborative nature. Key decision makers are now looking to and including CFOs and budget managers in operational strategy sessions. Here's where the automated CFO can shine with 'smart' technology.

Because of automation, data isn't siloed and inaccessible. Instead, all the information can be easily accessed by those who need it. This helps to broaden the number of key stakeholders involved in the budgeting and forecasting process.

In addition, when reports can be generated at the click of a button, snapshots can be shared across departments within minutes. This means no more waiting hours or days for IT to provide generalized reports.

Instead, department managers and decision makers enjoy real-time information in easy-to-understand visual dashboard formats. This helps remove guesswork and highlights the information that really matters.