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ken wolf

What Does Revelwood Do?

August 12, 2021 by Lisa Minneci Leave a Comment

Video

When you think of consumer companies, you might only think of them in terms of their flagship product or service. Coca-Cola sells soft drinks. McDonald’s sells hamburgers. Uber provides ride shares for people. Those companies actually do more than just what they are known for: Coca-Cola also offers Dasani, VitaminWater, Honest Kids, Gold Peak iced tea and more. McDonald’s is also known for its Filet-O-Fish and has now entered the competitive fried chicken market. In addition to offering ride shares, Uber’s services include food and goods delivery.

Many Revelwood clients think of us as their partner of choice to design and implement Office of Finance solutions based on IBM Planning Analytics and Workday Adaptive Planning. Like those consumer brands I mentioned, we do much more than that. We’ve recently added BlackLine to our best-of-breed portfolio and are looking forward to adding more world-class solutions for the Office of Finance.

We also deliver Customer Care solutions for managing and maintaining your Office of Finance systems.

Hear what our CEO, Ken Wolf, has to say about what Revelwood does and how we are enabling organizations to disrupt their companies, industries and the world.

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Filed Under: News & Events, Videos Tagged With: BlackList, Customer Care, IBM Cognos TM1, IBM Planning Analytics, ken wolf, Revelwood, Workday Adaptive Planning

FP&A Done Right: The Victors of the Decade Combine Agility and Resilience

December 20, 2019 by Ken Wolf Leave a Comment

FP&A Done Right

As we near the end of the decade, it’s a good time to think back about what businesses have learned from an FP&A perspective, and how they can fortify and position themselves for the next decade and for future decades.

The beginning of this decade saw the evolution of online analytical processing (OLAP) systems, such as our beloved TM1, grow into comprehensive and sophisticated platforms for holistic financial and operational performance management. In theory we had the tools to empower Finance to reveal the secrets of business success locked in our systems and in our data.

The last few years of the decade have seen our imaginations captured by the disruptors, the unicorns and those who have seemingly mastered the elusive “digital transformation.” But as we’ve learned over the last quarter, some of those “darlings” of the business world may not be the successes they first appeared to be. Take WeWork for example: the company has not managed growth effectively. They are at a point (or possibly past it) where Finance could step in, do some serious analysis and revisit the company’s business model. Other headline catching companies are growing exponentially, but struggle with delivering profits. This too, points to where Finance can be playing a larger role.

Business Resilience? Or Agility?

These musings were prompted by a recent article by McKinsey on business resilience. When we think about disruptors and unicorns, we might associate them more with the popular FP&A theme of business agility. One of our business partners, Adaptive Insights, frequently talks about business agility in the context of needing to make faster and more informed decisions. The backbone of this is continuous planning, which is spearheaded by the Office of Finance.

In one sense, perhaps, business agility is the young business, the quick, rookie running back on the football field – dodging and weaving and making stellar plays, with end zone celebrations when the offense is in control of the game.

But where does resiliency come in? To me, the resilient business is the more established, mature defensive linebacker, whose job is to thwart the competition, and who is less likely to be celebrating in the end zone, but just as important to winning the game.

The question for all of us, on the precipice of a new decade is, “Will we be playing a mostly offensive game in the next few years, or a mostly defensive game? Perhaps both.” And furthermore, how do we, the CFOs and the leaders in the Office of Finance, best prepare, plan and enable our organizations for what’s to come?

Facing the Future

McKinsey mentions that while we are still in “the largest global economic expansion in history, the outlook is uncertain.” Isn’t it always? The article states that in the company’s latest survey on economic conditions, “executives’ views on the current global economy and expectations of future global growth are less favorable than they have been in years.” I’d posit a good executive is outwardly optimistic and inwardly financially, cautiously pessimistic.

It is in this context that McKinsey examines what makes a company resilient. The article defines resilient organizations as those that exhibit a “willingness to take decisive action to strengthen their balance sheets and improve cash flow before the [previous] downturn hit, often by divesting non-core assets, reducing debt, and improving the efficiency of working capital.” To become a resilient business, McKinsey recommends the following three steps:

  1. Enhance the role of the finance team. They recommend doing this in strategic planning, business analytics and decision-making at all levels of the organization. As the article states, “The best way to do this is to embed finance managers alongside business unit leaders and empower them to be partners in running the business.” Think about that for a moment – take the traditional “bean counter” out of Finance and put her or him with the business unit leader. Imagine the possibilities: the finance professional knows where the data is, how to get answers from that data, and how to slice and dice that data in different ways. The business leader knows what questions to ask – questions urgent for today’s business challenges and vital for tomorrow’s business opportunities and threats.
  2. Pressure test capital structure and scenario plan. McKinsey recommends doing this with both capital structure and cash flow, and using a range of scenarios, “from an economic crisis to other disruptive events.” You might feel somewhat certain your industry will not have a massive disruption like that of Uber on the taxi industry. But what if you are a sports arena? How much overall revenue could, for example, MetLife Stadium lose should there be an NFL strike? Over how many games? While that is not a global crisis, it is an economic crisis with impact far beyond ticket sales. On a global level, are companies pressure testing and scenario planning for the potential impact of Brexit, of various international tariffs and trade disputes that, significantly increase the price of French cheeses and wines served at the high-end luxury suites at a stadium?
  3. Take immediate action to harvest hidden value from their balance sheet. McKinsey research shows “that working capital management is surprisingly variable, even among companies in the same industry.” The organization has found that “large companies that make a focused effort can typically free up more than $100 million from working capital and redeploy it to priority projects.” This argues for going beyond traditional budgeting and embracing more flexible planning methodologies, such as rolling forecasting or active planning. For example, McKinsey revealed that they saw “upside realized by companies that consistently track cash returns on an asset level and that make an ongoing effort to reevaluate and mitigate their liabilities.” With traditional budgeting and planning, you are assessing your balancing sheet in the past. By adopting rolling forecasting or active planning – where you have the tools and skill sets to assess and adjust your balance sheet proactively – you have the power to gain this upside.

As McKinsey states, “While most CFOs have a role in setting company strategy, the rest of the finance organization are sometimes viewed as passive scorekeepers. Best-in-class organizations, in contrast, expect their finance professionals to play a substantial role with business-unit leaders to set strategic priorities.”

Your Game Plan: Find Your Enabling Technology

So, what’s your best game plan for the coming years? McKinsey specifically mentions these best-in-class organizations have finance teams that “utilize innovative performance management tools to help determine how the business is actually performing and suggest steps to optimize results.” At Revelwood we’ve been consulting on and delivering solutions for financial and operational performance management for 25 years. One would think most mid-sized businesses have moved off of spreadsheets for their budgeting, planning and reporting activities. But, day-after-day, our team here speaks with not just new upstarts, but established, even large, publicly traded companies that rely on spreadsheets as the backbone of their core activities in the Office of Finance. Spreadsheets have a role in the Office of Finance and always will. But any organization that uses only spreadsheets simply can’t achieve true resiliency. And they can’t embrace agility.

Your Game Plan: Think Differently About the Office of Finance

How can you unlock the potential hidden within your finance team to add true value to the business? Think differently about how to enhance your team members’ roles. Maybe it’s even a matter of breaking up some aspects of the physical office and having finance team members sit among their associated business units. Separate their function from their strategic role. Be agile about how you think about your people and what they can do for the business.

The End Game: Resilience and Agility

As I mentioned, we think the victors of the next decade will strike a good balance between resilience and agility. Or, offense and defense. Invest in the right enabling technology, rethink the role of the Finance team, and build the skillsets and mindsets for both. That’s your best game plan.

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Filed Under: FP&A Done Right Tagged With: Adaptive Insights, agile planning, Analytics, business agility, business resilience, continuous planning, Financial Performance Management, FP&A, FP&A done right, IBM Planning Analytics, ken wolf, Rolling Forecasts, TM1

The FP&A Alignment Gap and How to Avoid It

October 31, 2019 by Ken Wolf Leave a Comment

We buy new software solutions expecting that we made the best choice in technologies and service providers, and that we’ll get years of productive use out of them. And, we were right… at the time. Then, we ask ourselves, “Why are my users complaining that the software stinks? That performance is unbearably slow, or that it simply doesn’t work for them anymore?” It’s something we at Revelwood call the Alignment Gap.

When we first rollout our new software solution, it’s in perfect alignment with our business needs. We gathered our current business requirements and probably worked with a consulting firm or service provider to translate those requirements into the ideal solution. At the point of rollout, the gap between our needs and the solution is hardly visible. However, over time several things happen:

  • First, our business needs evolve. We enter new markets, make acquisitions and reorganize ourselves to address these changes. Perhaps we start to outgrow our original requirements.
  • Second, we start to tinker with the solution to make it work better for us. These one-off tweaks start to look like holes in the dam that we’re plugging without any overall plan on how it should all fit together.
  • Finally, the technology itself improves, but we fail to take a step back and figure out how we can take advantage of its new features and capabilities.
The FP&A Alignment Gap

These dynamics create an ever-widening gap between our needs and the solution we were once so excited about. The wider that gap is, the greater levels of dissatisfaction we experience from our users and by the organization as a whole. Eventually, we get to the point where nobody is happy, and users begin to trash talk the software itself, rather than how we’re misusing it. So, how do we keep the Alignment Gap as narrow as possible?

The biggest mistake companies make is that they don’t ensure an ongoing review and assessment of their software solutions so that an Alignment Gap never occurs in the first place. Imagine never going to the doctor for a check-up, but expecting that you’ll remain in perfect health forever. Imagine not bringing your car in for service periodically to make sure that you don’t break down when you’re out on the open road. It is critical to examine your software solutions on a regular basis to ensure they continue to meet your ever-changing business needs. And, you must invest in incremental improvements to reflect those needs and keep your solution current and relevant. These incremental changes will cost a lot less than the impact of low user adoption, unreliable results and the effort required to revisit the marketplace and invest in a whole new technology platform to solve the problem. Chances are, your current technology is not the problem… it’s how you’re using it!

Fortunately, Revelwood has a service offering for FP&A solutions that eliminates the  Alignment Gap. It’s called Performance Tune-Up and involves a thorough review of your solution at an appropriate frequency to ensure that it continues to operate efficiently and meets your changing business needs.

Don’t let the Alignment Gap erode the health of your FP&A operation. Talk to us today about our Performance Tune-up service.

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Filed Under: FP&A Done Right Tagged With: Analytics, Financial Performance Management, FP&A, FP&A done right, ken wolf, Revelwood

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