2019 was certainly been a year of political and economic uncertainty. Whether it was Brexit in the UK, protests in Chile and Hong Kong, trade wars between the US and China or even extreme weather affecting countries from the UK to India, businesses have been constantly reminded of the need to stay agile and respond effectively to unexpected events. The decade since the global financial crisis has also been one of huge disruption for the financial services industry, most recently when the London Stock Exchange experienced a major outage during the summer of 2019, which is being identified as the result of a software glitch and possibly even a cyber-attack. Yet recent findings from Vuealta suggest that businesses are not prepared for technology disruption.
2020 has to be the year that business models evolve more than ever to keep pace with our changing world.
So, what is the answer? Agile business planning has to take centre stage in helping financial businesses stay one step ahead. But many would be forgiven for not knowing where to start. It comes down to balancing the rapid deployment of new planning applications against longer term digital transformation strategies.
With much disruption on the horizon, organisations must break any existing barriers down and connect all areas of the business to ensure they are prepared to cope with regulatory changes and keep up with new rival FinTech companies that are transforming the market.
Businesses need to ensure that they are planning for every scenario and have every angle covered in 2020 and beyond. Only then can they jump on new opportunities and steal a march on rivals, big and small.
With this in mind, what are our predictions for agile planning in finance over the year ahead?
- Larger planning teams will become more popular, including the rise of the Chief Planning Officer:
While planning is not a new function, it is only set to evolve as business needs become ever more complex.
In 2020, planning teams can further embed themselves into functions such as HR and finance to ensure that effective planning is becoming a daily task, not just an ‘add on’ to be carried out on occasion or for special projects.
To ensure that this is the case, financial organisations should consider the need for a new planning leader in 2020, one thatspans the organisation and is the champion for all planning, analytics and decision-making – the Chief Planning Officer (CPO).
- Organisations will be planning for international expansion:
From trying to reduce economical impacts, through to responding to an increase in competition from new markets and meeting customer demands for new products and services, we can expect to see greater international expansion in 2020. In fact, research from Vuealta earlier this year revealed that 74% of global businesses were looking to expand into new markets.
While this will open further revenue opportunities, it will make planning more complex, including the need to integrate new market data into business plans quickly and effectively.
Integrated, cloud-based planning technology will be critical in providing the insight and agility needed for successful international expansion
- Digital transformation – including connected planning and the rise of pre-configured apps – will continue to be a priority:
With so much disruption and change within the marketplace, financial organisations need to be able to make changes to their planning based on market insight almost instantaneously. But research earlier this year from Anaplan showed that 75% of organisations take weeks or months to update plans with market changes. This is largely due to a reliance on traditional planning techniques involving historic trend analysis and human judgement, rather than current data, and largely based on manual, legacy systems
Therefore, digital transformation will be a key focus for business planning in 2020, focusing specifically on the ability to use technology to connect data, people, and processes across an entire enterprise.
By moving planning processes away from spreadsheets and other manual processes, to cloud-based technology, financial businesses can also automate and streamline tedious processes, which reduces human error, improves productivity, and provides stakeholders with increased visibility into performance.
At this point, there’s so much technology out there, that businesses are struggling to see the wood for the trees. Much of the technology on the market now is so advanced and complicated that it’s hard to cut through the jargon and understand how to get the most out of it – even for those that are more technically minded.
Companies in 2020 and beyond need to seek out expert consultancy to advise them on how to make the most of it. Someone who can understand what business problems they need to solve and how that can be tackled with the right technology. For example, we expect to see a rise in demand for preconfigured applications, which can be deployed rapidly into planning operations, and deliver immediate results across businesses this year. However, specialist advice will still be needed to ensure that organisations’balance the rapid deployment of planning applications against longer term, digital transformation strategies.
- Intelligent planning and the use of Machine Learning and Artificial Intelligence, will grow rapidly in 2020:
Intelligent planning – the application of Machine Learning & Artificial Intelligence (AI) to business forecasting and planning processes – is the next exciting step which some organisations in the finance industry will soon begin to take in their digital transformation journey, to enable businesses to exploit much more advanced analytics. In fact, 94% of organisations believe it will impact the future of planning.
Intelligent planning will provide the opportunity to consume, exploit and create actions based upon much larger volumes of data and identify patterns within it that would otherwise be impossible.
Based on data from both within and the outside the business, intelligent planning will be used by organisations to automate, predict and prescribe the right course of action for any business process, from forecasting and scoring, to optimisation and categorisation.
The potential for AI to transform business decision making is unprecedented. Big data, machine learning, and deep learning will be able to automate decisions and provide powerful insights into demand forecasting, promotions optimisation, procurement strategy and a host of other business processes.
2020 for many brings the prospect of more uncertainty. Will government leaders around the world rise up to the climate change crisis? Will the continual rise of AI start to really affect the labour market like commentators say it will? There may be no crystal ball which provides clear answers to these questions, but one thing businesses can do for certain is ensure that agile planning is in place, to future proof their operations for years to come.