Perspectives from InnoVergent CEO, Paul Cammisa
As we wrap up the first month of the year and keep looking ahead, we realize that the budgets and forecasts we had established for 2017 are already evolving and in need of updates. What we thought was a finished task, ends up needing monthly updates and requires tools to support it, as well as discipline to help you be proactive and manage your business. To achieve this, however, most companies have adopted rolling forecasts as their main method of budgeting. The reason? Change is the key to any successful business.
Much like the weather, and any other changes that we see on a daily basis, revenue and income numbers are far from being static. As a former accounting executive, I remember sitting in front of a budget and trying to figure out the best ways to predict and forecast. If you’re struggling to figure out what the best practices are, here are some questions you should ask yourself:
What does your forecast look like next to other standards in your industry?
How often should you be updating your budget?
Are you prepared to deal with unexpected changes?
Are you using the right tools to help you determine your numbers and expectations?
When it comes to the last one, however, you should also ask yourself whether these tools have the ability to update proactively based on drivers and whether traditional tools such as Excel have the necessary levels of sophistication to satisfy your needs.
As much as we want to try to come up with accurate budgets at the beginning of every year, it’s always good to remember the importance of rolling forecasts and their ability to adapt to change. During a time where we want to keep every financial aspect of our companies under the microscope, I always try to think on a higher level, wondering what the smartest next step will be and embracing change every day.
So, are you ready to come up with a fast, easy, powerful budgeting system that will let you understand your business and predict the future of the industry?
To learn more about how InnoVergent can help you implement the necessary tools to weather the storm, contact us at firstname.lastname@example.org