Improving the Forecasting Process and Visibility
A leading North American sales and marketing agency serving the consumer and retail sector was facing several challenges, including performance headwinds, increased difficulty in providing driver-based revenue and EBITDA forecasts, and lack of visibility around the root-causes of forecast variances in recent quarters. The Management team and Sponsor engaged Accordion to assess current forecasting processes and help drive process enhancements.
FP&A Process Redesign and Implementation
Stakeholder Reporting & Strategic KPI Enhancement
Budgeting & Forecasting Process Improvement
- Worked closely with the Company’s FP&A team and other stakeholders in a phased approach.
- Conducted root-cause analysis of historical variances:
- Analyzed quarterly forecast variance – identifying key revenue and expense variance drivers across business units and customers.
- Engaged in a deep-dive of process diagnostics and gap assessment:
- Reviewed and documented the current quarterly forecasting process, including timing, stakeholder involvement, and data/templates involved.
- Interviewed stakeholders including key business partners (functional and business unit) to understand pain points, challenges, and areas of opacity.
- Redesigned the forecasting process incorporating additional stakeholders and review loops:
- Identified additional data points, internal and external (market data), to be incorporated.
- Developed new templates that incorporated additional market and internal data points to guide forecasting bands, and increased granularity into revenue and expense drivers (price, volume, fixed vs variable, FTEs).
- Assisted with an in-cycle implementation of the redesigned process and tools during their quarterly reforecast cycle:
- Trained the finance business partners and sales managers on new process.
- Validated templates and transitioned process changes to relevant stakeholders.
- Developed a forecast sensitivity model for top level analysis across clients/business units.
- Incorporated real-time feedback from forecast reviews to develop a steady-state process.
With Accordion’s assistance, the Company was able to implement forecasting best practices across its business units. The new forecasting process incorporated relevant stakeholders and improved visibility into granular revenue and expense drivers. As a result of our work, the Company also increased communication and collaboration between the FP&A team, key customer sales managers, and business unit leaders. Our team also developed a steady-state forecasting process with enhanced roles and responsibilities to further improve the process collaboration and overall visibility for the Management team and Sponsor.