Finance and Operations Integration Workshop
Finance and operations have different concerns even though they share the overall goal of sustained profitability. The key to integrating finance and operations planning is to provide a mechanism to relate data from each of these functions consistently and routinely.
Operational performance is, of course, the key to achieving the financial forecast. Just as companies measure orders and bookings against a sales forecast, operational performance and the current outlook must be measured against the financial forecast. What this means is that the companies that are running monthly tactical planning should create meaningful and robust metrics that measure financial performance.
Sales and Operations Planning keep insisting that the financial forecast should be a consequence of the sales forecast. This is simply not realistic. Because of budget cycles, external reporting requirements, price forecasts, commodity cost forecasts, and the aggregate level at which it is needed; the financial forecast will usually be derived independently.
To achieve an optimized integrated planning process, finance and operations need to collaborate effectively. However, one sticking point in financial planning is the disconnect between the operational forecast and the financial budget/forecast. Best-in-class companies have managed to bridge this gap.
Finance and Operations Integration Diagnostic.
Force Field Analysis.