CFOs See The Future With Planning and Forecasting Methodologies


A survey of major companies in multiple sectors across Europe has revealed that driver-based planning and rolling forecasting are fast gaining prominence in boardrooms as enterprises look to maximise returns and competitiveness.

CFOs and other senior executives at more than 30 companies including Shell, Citi, Universal Music and Lufthansa responded to the survey by business intelligence and corporate performance management software vendor prevero.

Their responses reveal that most top-tier enterprises now regard Web-deployable budgeting automation as indispensable. Rapidly displacing spreadsheet templates as a way of gathering performance metrics, automation saves management time, improves the quality of information and enables more effective financial control.

Asked specifically about their use of driver-based planning and rolling forecasting, CFOs revealed the extent to which the two techniques have become an embedded part of corporate monitoring and control. Driver-based planning is used in 65% of production operations, with sales second at 55% and marketing and service joint third at 35%. CFOs cited time savings from shortened budget cycles as the primary reason for moving to driver-based planning.

Unsurprisingly, 100% of survey respondents said their company used rolling forecasting in sales. But they also revealed the extent to which rolling forecasting is now moving out from that bridgehead to penetrate other functions including cost centres (50%), investment (40%) and HR (25%).

Respondents identified automation that supports centralised business models and collaborative workflow as a key element in successful adoption of driver-based planning and rolling forecasting. Without automation the greater frequency and larger datasets of driver-based planning and rolling forecasting were simply unmanageable. Automation with centralised data collection displaces emailed spreadsheets, generating typical savings in management time of between 30-50% while at the same time allowing companies to experiment with the frequency of planning and rolling forecasting in order to reach the optimum balance between granularity and timely, accurate information.