“The Path to Meeting Your 2013 Plan: Metrics, Technology & Accountability” webinar was held on December 13, 2012, and sponsored by Proformative. The webinar is presented by Alex Ortiz, Director of Marketing at Host Analytics, and Diana Lowell, Corporate Controller at Mirion Technologies. In this webinar, Ortiz and Lowell discuss why companies are not meeting their goals and how Cloud technology can help them with strategic planning in the future.
Companies Are Struggling to Meet and Exceed Their Goals
Most big companies publicly predict revenues and expenses on a quarterly basis. Unfortunately, there is a trend showing that companies are struggling to meet their planned goals, much less exceed their predictions. Even businesses like Apple are struggling.
There are generally 3 main reasons why companies fail to follow their plan.
Tendency to Look Backwards
It’s easier for companies to look backwards to see what happened because their records reflect past revenues and expenses. But in order to make accurate predictions, companies need to look forward and use real-live information instead of last quarter’s numbers.
As companies get larger, it’s hard to ensure that everyone is working towards the same goal. At the same time, it becomes more difficult to ensure that people take responsibility for the numbers they should own.
It’s challenging to take action quickly, especially for big companies. Companies have a lot of information at their disposal, but it’s not always easy to differentiate what’s important from the things that are just extra noise.
Technology Can Keep Companies on Track
In a survey of 541 finance executives, most respondents reported that technology was helping them achieve better results. One of the things they mentioned is that using technology allowed them to improve financial planning.
When it comes to financial planning, most companies are already performing a what-if analysis, revenue planning, profitability, and opportunity planning. However, some companies use the technology they have to dig even deeper. When you can perform broader types of analysis, you may discover new opportunities that weren’t in your original plan. This can really help differentiate your company from your competitors.
Cloud Technology Is Not New
While the surveyed finance executives were reporting that technologies are helping their companies succeed, the technology they’re referring to is not new. Cloud computing has been around since the late 90s with products like NetSuite. Nevertheless, there are still lots of good reasons for companies to switch to cloud computing.
Why Companies Are Moving to the Cloud
The two main reasons why companies are moving to the Cloud are agility and cost. Using Cloud software frees resources in the accounting and IT departments, which means that your company is spending less time on implementing new systems and more time on managing the company and analyzing your company’s performance.
Cloud Software Is Continually Updated
One of the biggest advantages of Cloud software is that it’s continually updated. Your company is no longer forced to upgrade your systems every 2 to 3 years, as is the case with traditional software.
Cloud Software Is Less Costly
The cost of the software isn’t the only problem with traditional technology. Before companies were moving their operations to the Cloud, they were required to spend a lot of money on new hardware whenever they decided to upgrade or switch their software. With the cost savings your company gains from moving the Cloud, you can even update any older systems your employees might still be using today.
Keep Your Information in a Central Location
Moving your operations to the Cloud gives your business a central source of truth. Your applications and your data is all in one space which helps your company make better decisions and predictions. Your company can use the Cloud for more than just planning. You can use it for management, analysis, strategic planning, and disclosure. The Cloud is there to help you reach better decisions faster.
You Have to Look at the Right Information
In order to make the right decisions, your company has to look at the right information, the so-called leading indicators. When companies look use leading indicators to predict and plan business operations, they report a 5% higher return on equity on average.
Now the big question is, what are leading indicators? Leading indicators include data that your company is already collecting. For example, you already have a sales pipeline and a marketing pipeline. And you’re probably already looking at economic indicators, such as the consumer price index. The challenge is to bring all of this information in to your platform in order to take it into consideration.
The Cloud Provides an Overall Picture
When your company uses the Cloud, you can see the overall picture. The Cloud allows you to collect and analyze the information you have collected from different sources. It gives your management team everything they need in order to make better business decisions and provide an accurate analysis of the firm’s current performance.