What are the best practices for FP&A data quality and governance?

1 Benefits of FP&A benchmarking

FP&A benchmarking can help you identify strengths and weaknesses, as well as opportunities and threats, in your FP&A function. By measuring and analyzing your performance against relevant benchmarks, you can gain insights into how you can improve efficiency, effectiveness, and value creation. The benefits of FP&A benchmarking include enhancing credibility and confidence by demonstrating alignment with best practices and industry standards, increasing agility and responsiveness by eliminating bottlenecks, gaps, and redundancies in processes, improving accuracy and reliability by ensuring data is consistent, complete, and validated across the organization, and driving innovation and transformation by discovering new trends, technologies, and techniques that can enhance capabilities.

2 Challenges of FP&A benchmarking

FP&A benchmarking is a complex process that requires careful planning, execution, and analysis. It is important to understand your FP&A objectives, scope, and criteria when selecting benchmarks and sources. Challenges include finding the right benchmarks and sources that are relevant, reliable, and comparable to your FP&A situation; collecting and processing accurate, timely, and consistent FP&A data; and interpreting and communicating the results in an actionable way. Moreover, the data must be compatible and standardized with the data from your benchmarks.

3 Examples of FP&A benchmarking

FP&A benchmarking can be done at different levels and dimensions, depending on your FP&A goals and needs. For instance, you can compare your own historical performance or targets with those of your peers or competitors, or with best-in-class or aspirational organizations. This can help you assess your FP&A position, performance, and differentiation in your market or industry, as well as track your progress, achievements, and gaps. Here are some examples of FP&A benchmarking case studies from different industries and contexts. A global consumer goods company used FP&A benchmarking to compare its FP&A processes, resources, and outcomes with those of its peers and competitors. The company found that it had a higher FP&A headcount, cost, and cycle time than the industry average, but a lower FP&A quality, accuracy, and value added. They then implemented several FP&A improvement initiatives. A regional healthcare provider used FP&A benchmarking to evaluate its FP&A capabilities and maturity against those of the best-in-class healthcare organizations. The provider found that it had a lower FP&A maturity level than the best-in-class, particularly in terms of its data integration, analysis, and visualization. They then adopted several FP&A best practices. Lastly, a national nonprofit organization used FP&A benchmarking to measure its alignment and impact with its mission and vision. The organization found that it had a high alignment with its strategic goals but a low impact on its operational outcomes. To address this issue, they developed several action plans for aligning their metrics and KPIs with their mission and vision, integrating their data and insights with their decision making and execution, and monitoring their results and feedback.

4 Tips for FP&A data quality and governance

Improving FP&A data quality and governance is essential for any successful FP&A benchmarking project. Without reliable, consistent, and secure FP&A data, you cannot perform meaningful and accurate comparisons and analyses. To ensure this, you should define your FP&A data standards and policies, including the rules and guidelines for collection, processing, storage, and usage. You should also implement quality controls and checks to guarantee that your FP&A data is complete, accurate, valid, and timely. Additionally, you need to protect your FP&A data security and privacy by preventing and mitigating any risks, breaches, or losses. Assigning roles and responsibilities for your FP&A data management and oversight is also important.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?