How Scaling Companies Handle Budgeting
This article will describe how companies with multiple business units process budgets and forecasts.
Scaling organizations face a multitude of challenges. Organizations having to coordinate budgets and forecasts from different data sources between multiple business units experience even greater logistical obstacles. Reaching out for manually updated spreadsheets not only takes time but it also provides too many opportunities for miscommunication. What if your organization is multi-national and needs to process different currencies? We can only imagine the headaches. Specifically for companies with multiple business units, consolidated data provides consistency, and we’re guessing, a little relief. This article will describe how organizations with this structure tackle these budgeting challenges. From cutting the amount of time generating reports to reevaluating budget templates, having the right structure in place streamlines budgeting and forecasting.
Gathering the Data
If we’re all using Excel, then all of our data will line up perfectly, right? Maybe in theory, but even with basic templates, individual units working separately leave too much margin for error. Collecting the necessary data to create a budget in the first place can feel inefficient, or at worst, a nightmare. If, for example, your organization requires consolidating Excel spreadsheets from multiple business units or those business units manually budgeting on spreadsheets, that complicates converting budget scenarios. Allowing for human error, manually assembling a budget risks incorrect distribution of data, which can cause friction within the organization. Having one single space for budgets, forecasts and data has numerous benefits, an under-the-radar one being streamlined communication channels. For example, there is no confusion of where reports and data need to be sent. Overall, organizations with multiple business units should be able to rely on data provided.
Staying on Track
Different business units have their own schedules, deadlines, and in the case of multi-national organizations, currencies. Aligning all of these varying elements can contribute to a month’s long budget process. While automation is not an all-encompassing solution for every kind of budgeting issue, automating certain aspects of the process can significantly ease the burden. For example, automatically distributing reports by user or automating currency conversion, automates two processes prone to human error, according to the organization’s needs. Additionally, eliminating the heavy lifting manual processing, allows individual business units to stay on track with their respective schedules. Overall, automation can even save time in the steps preceding processing your budget.
Using the Right Tools
As described above, consolidating data into a data warehouse and automatically distributing reports to various users sound great. We also like the idea of being able to edit reports without having to call a specialized ERP (Enterprise Resource Planning) developer. Of course, this functionality sounds amazing! However, the challenge of attaining that functionality is a whole process in and of itself. While investing in budgeting and reporting technology can be a debate for many companies, for growing companies that currently have a manual process in place for budgeting, it’s practically required. Even for companies working toward growth, having mechanisms in place, like a robust integration between the ERP system and budgeting tool, to handle a complex budgeting process saves time, money, and (once again), probably a few headaches. Starting with evaluating your organization’s current ERP system and types of reports, the right solution inevitably varies. However, the need for a solution in the first place is undeniable.
It’s difficult to discuss solutions for scaling companies without mentioning cloud software. Simply put, there’s a reason so many companies are switching from on-premise solutions. For growing companies with several moving parts, cloud software does not require data being stored in one place at one time. Conversely, cloud software enables collaboration from different locations, allowing for seamless communication and updates between business units. Implementing an on-premise solution sparks debate about investment, efficiency, the future of the organization, whereas a cloud software only requires a subscription.
Communication serves as a bedrock for companies with multiple business units. Despite everyone’s intentions, good communication is hardly a given. Even setting aside the time and money automated budgeting save, scaling companies invest in tools that everyone in the organization can trust. Whether that tool includes a data warehouse that consolidates your data, or a built-in ERP integration that readily uploads data, the right tool makes staying on the same page easy. If you are struggling to find a tool that checks all of these boxes, or aren’t sure how to work with the tools you already have, Solver has a team of experienced professionals that can get your organization started in upgrading your reporting process.