The Pitfalls of Budgeting & Planning Deployments: Part I | Business ...

by Dwight deVera

The financial success of any organization begins with a well-structured budget for each department. Just having this budget/plan in place does not guarantee success, but not having a plan guarantees failure.

But with only half of organizations? plans being accurate and two-thirds not being able to investigate the details of their budgets in real time, many companies are planning major modifications to their budgeting and planning because they are painfully aware of the shortcomings of their process.^[1]

The implementation of a comprehensive budgeting, planning and forecasting (BP&F) tool should not be taken lightly. Though BP&F solution deployments can take as little as 6 weeks or as much as 4 months depending on the complexity, these projects require significant forethought, resources, and strategy. With this in mind, here are some pitfalls to avoid if at all possible. These of course apply to all business intelligence projects, not simply BP&F:

1) Unrealistic scope
An unrealistic scope is the #1 project impediment we see at arcplan. Because our solution, arcplan Edge, is fully customizable, we enable our customers to not compromise on their requirements. However, not every company has the funds to deploy every item on their wish list in Phase I of the project. So what can you do to ensure project success?

Lay out the "must haves" and "nice to haves" for your project up front, allow the vendor to determine what is possible in the deployment timeframe, and then both parties must compromise if necessary and stick to the plan. This is basic project management, but it's so critical to BP&F projects. Why? It's all about expectations. The finance team does not have too many opportunities to implement huge IT/software projects. A BP&F system might be the largest IT project the finance team will ever encounter (other than ERP), so tensions and expectations are high. A BP&F system is supposed to make the finance team's life easier, so they will have a long list of "wants" for the system, some of which are not critical to Phase I of the project. Your vendor's project manager will help determine what is feasible for this first phase and what modifications can wait until after the system has been tested, approved, and rolled out. If everyone is on the same page from the beginning, accepts the project scope, and approves milestones throughout the implementation, you have a recipe for success.

2) Data problems
In our thousands of implementations, we've never encountered a client with perfect data, so data problems are not something you're likely to escape. There are a few data issues that we've seen: no data source in place, too many data sources to pull from, and bad data.

When it comes to budgeting and planning, sometimes organizations have a data warehouse already in place and sometimes they are simply working off of spreadsheets, in which case, a database has to be built. This takes time and resources that will have to be built into the project plan/scope.

Data integration from heterogeneous data sources can be a problem for some BP&F vendors; however, arcplan Edge seamlessly integrates data from various sources and makes it possible to access information and analyze budget plans in real time. So choosing the right solution can make all the difference, allowing you to overcome your imperfect data.

And of course, bad data is an issue for any business intelligence project, planning or not. Corrupt information will corrupt the decisions based off of it. This blog offers a lot of suggestions for how and why to mitigate bad data, but arcplan has a distinct advantage when it comes to working with organizations that have data quality issues. Unlike other vendors' solutions, arcplan has the ability to manipulate data at the surface, so instead of having to commit resources to fixing database-level problems (like re-arranging months of the year so they're in sequential order rather than alphabetical order), arcplan can simply re-order the data correctly at the surface (January to December, for example, if you work on a calendar fiscal year), or perform what we call "surface-level math" to get you the calculations you need without the exact information already existing in the database. We'll actually show some examples of this in our webinar on September 19^th, Effective BI Dashboard & Scorecard Design.

Next time, I'll review a few other "stones in the road" on the way to your BP&F project success.

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Source: http://biblog.arcplan.com/2012/08/the-pitfalls-of-budgeting-planning-deployments-part-i/

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