Project planning and tracking is something that falls under the responsibility of most Chief Information Officers (CIO). With many stakeholders, it is a cumbersome process to manage, is disconnected across cost centers and business units, and often does not generate insights at a meaningful level of detail.
The Current State of IT Financial Management
The process for IT project planning often involves numerous spreadsheets, with multiple versions of operating and capital budgeting expenses, across dozens of cost centers. This results in inefficiencies and wasted time.
Some common characteristics of financial management for the IT function include:
Manual processes (or inability) to align actuals to forecast by project, and conclusions that are often delayed and/or inaccurate.
Frustration and confusion amongst stakeholders.
Spreadsheets and static presentations that include gathering information via email.
Time-consuming re-work that is the result of changing data that occurs when manually aggregating project costs; Reporting and planning cycles need to start again at each occurrence.
Transforming IT Financial Management with Connected Planning
By replacing numerous IT planning and budgeting spreadsheets with one Anaplan model, IT organizations have immediate visibility, transparency, and accuracy into the IT financial planning process. This enables a connected and streamlined planning process and a shift of mindset from past performance to future possibilities.
The benefits of a transformation include:
Detailed planning and reporting at new levels, made possible by integrating general ledger data into Anaplan. Automated updates on how IT spend is tracking against the plan, supports a data-driven organization.
Customized dashboard view, tailored to the CIO, that answers key questions and reduces lengthy time spent by teams preparing answers.
One source of truth for relevant data points, including prepaid expenses, accruals, and amortization schedules.
Workflow functionality to manage budget submissions and re-forecast approvals.
Speed-to-value with timely implementations that provide a centralized portal for forecast management and reporting.
This type of transformation changes the culture from reactive to proactive and paves the way for a new conversation between a CIO and IT organization.
A question-oriented discussion can now become outcome based:
Pre-transformation: Past tense questions
Post-transformation: Future tense answers
What did I spend?
This is the project burn rate.
What was my variance to plan, and what was the variance driver?
This is the estimate at completion.
Will I still hit my planned budget?
This is how the project will hit the planned budget.
What will my capital investment be at the end of the year?
This is the cost of supporting the application/solution for the next three years.
Project Planning for IT can be transformed into an information-driven financial planning process, supported by the Anaplan platform. Increased speed-to-information and transparency into IT expenses facilitates rapid responsiveness to business needs and better budget management.
Additional benefits include:
Improved forecast velocity and accuracy.
Decreased time required to prepare re-forecast (by half, in some cases).
Better use of IT funding.
Timely insights to actuals—in near real-time.
Single source of truth for forecast entry, aggregation, and roll up.
Data integration and automation of forecast roll up and reporting.
Opportunity to integrate additional capabilities, including resource planning.
How is your organization managing its IT project spend? Is your CIO experiencing true Connected Planning? Share your experiences in the comments below.
Tim Bausman is a Business Advisory Consultant that leverages process improvement and data modeling experience to develop Connected Planning solutions at Slalom Atlanta. His experience spans multiple industries and business functions focusing on helping organizations use data to drive decision making and become more agile.
Nathan Whitmire is a Solution Principal in Slalom Consulting's Atlanta market and a leader of Slalom's Connected Planning capability. Nathan is an experienced financial and business consultant with a strong background in financial modeling and analysis, and project management. He has cross-industry experience in helping clients transform their business with Slalom’s “process led, technology-enabled” approach to Connected Planning initiatives.