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FP&A professionals are some of the hardest working people I know.

To be successful in FP&A, you have to be flexible and driven.

• Flexible with the changing business needs

• Driven to improve your processes and create more value for your business partners

That’s why so many FP&A professionals get frustrated with the profession.

But the key to a long, successful career is simple (not easy):

People - Product - Process

There’s this TV show that I used to binge (RIP) called The Profit.

In the show, a savvy business guru named Marcus Lemonis would fly around the US to struggling businesses and effectively turn them around.

And he had a 3-part strategy:

• People

• Product

• Process

In his opinion, every business could be boiled down to:

• Do you have the right people?

• Do you have the right product?

• Do you have the right processes?

Simple? Yes

Effective? Absolutely

And this framework can be extended to a lot of things in life - including FP&A teams.

While you might instantly be able to resonate with FP&A’s version of People and Process, we need to dive deeper into FP&A’s Product…

Our product = The FP&A OS

If there’s one thing you can count on by subscribing to my newsletter, it’s the fact that I’ll beat you over the head with The FP&A Operating System (OS, for short).

What is it and why does it matter?

It’s the vision that high performing FP&A teams aim for.

It clearly shows what kind of value we add to the business and in what order.

It starts with the foundation of People and Process (Data & Tools), then jumps into the reason for FP&A’s existence - driving optimal business decisions with 4 connected Products (Reporting, Analysis, Forecasting, Consulting):

People

In the beginning, the founder wears all the hats of the business. But as a company begins to scale, specialized finance expertise is brought in to organize the company’s financial data in a way that improves the CEO’s ability to build a successful business.

Having high-quality people is at the bottom of the FP&A OS to signify that this is the most critical part of FP&A - if you get the foundation wrong, it’s hard to make up for it later.

Data & Tools (Process)

Every experienced FP&A professional knows that having the proper data and tools severely impacts their ability to drive value for the business. As we like to say about bad data, “garbage in, garbage out”. And having the right tool for the job ensures FP&A can efficiently and effectively do their jobs day-to-day.

Having great people but bad data and tools is not ideal (but is where most FP&A teams go wrong). Imagine giving a master homebuilder old, rusty tools. Could they build the home? Yes. Would it look great? Yes. But would they quit working for you? Probably.

Reporting

The foundation of any great FP&A team is great reporting. It starts out with a healthy reporting ecosystem and your ability to create best-in-class reports without spending your entire month on reporting.

Reporting is the biggest part of the pyramid because we need reporting on all aspects of the business. Often, FP&A is seen as a reporting function - it’s the most tangible thing we do for a business. But it’s only just the beginning…

Analysis

Uncovering the root cause of the change in results is easier said than done. Your ability to systematize analysis using templates and techniques will help you drive actionable insights within the business.

While FP&A provides reporting over the entire business, we only analyze certain parts each month/quarter/year. Being resourceful with what analysis you perform and to what depth will help you drive clarity over critical business trends that need further insights.

Forecasting

Forecasting is the holy grail of FP&A. I argue that a great (meaning accurate and informative) forecast is the foundation of a great FP&A team.

Consulting

Once you've done a ton of great work in reporting, analysis, and forecasting you need a way to communicate it so your company will take action. Consulting (often called business partnering) is the way you build trust, communicate proactively, and create value for your key stakeholders.

In summary:

If you want to add value in FP&A, you need a vision.

And lucky for you, other great FP&A teams have already established what that vision could look like.

Here at Forecasting Performance, we call it The FP&A OS.

Spend some time reflecting on your team - where do you feel deficient… where are your strengths?

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