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Lessons from the field: Powerful Planning Models in Cloud EPM

Published June 30 2022
Cloud technology
3:00PM EST
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Today's financial planning systems demand agile techniques to model within their planning applications. Alithya has first-hand insight into what customers implement to flex their planning models in Cloud EPM Planning. The presenter will illustrate some tried, tested and novel modeling methodologies that are being used by customers by bringing to bear state-of-the-art artifacts in Cloud EPM platform.

Following will be some exemplary areas of focus:

  1. Flexible Horizon changes - this methodology allows for FP&A to change their processes in times of a black swan event (COVID-19 notwithstanding) without significant investments in re-implementations. A customer who had a traditional driver based budgeting solution quickly enhanced the Budget scenario to use separate models for each quarter of the Budget. Planning expressions, Groovy scripting and form designs catered to this solution. Significant ROI is realized in being able to flex an existing model as opposed to rewriting a new model for quarterly forecasts in a separate scenario to cater to the black swan event.
  2. Target and Bottoms-up Conference - this methodology is for an "Always-On" paradigm which lets FP&A leadership assign tops-down target while the Planner builds bottoms-up forecast to meet the target. "Always-On" allows for leadership to continuously assign new target goals for planners to build up their forecast to. Multi-plan type architecture along with artifacts such as smart pushes, groovy scripting, version management and form design are corner stones of this solution. The solution provides FP&A with a robust and iterative methodology to build forecasts that integrate organization's pro-forma and tactical planning processes.
  3. Back-casting - one thing that we notice quite often is that finance leaders know the topline number they plan on accomplishing in future such as for revenues or for operating expenses. How would you back-paddle when that number is overlaid on forecast is what we call a "Backcast". A combination or Groovy scripting and Allocations bring about this flexible and exciting modeling technique that aids C level executives build what-ifs on current bottoms-up forecasts.
  4. Impute & Plan by exception - out of the box frameworks for trend modeling allow for planners to pick from various trend models such as actuals average and hold to forecast by line items. We are seeing most customers prefer using trend based modeling but don't want to constantly pick it by line or want to create a standard across the organization so that the numbers are "imputed" for the user community as preparatory step to opening a forecast. Furthermore, after the start of the forecasting cycle, the planners can then override imputed lines with a preset number of available trend methods to them. This technique is popular with FP&A teams who want to have trend based model automated for their entire organization and only allow "by-exception" overrides on them.

Register now to learn about EPM methodologies.