Why FP&A Teams Use Driver-based Planning

Emily Mason

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The common theme? Less time spent on administration and hunting down formula errors. More time for analysis and welcoming business partners into the process. 

Note: To see exactly what it's like to use a configurable, driver-based platform, check out three simple steps for crating a complex salary assumption in Stratify.

5 Reasons to Choose a Tool with Driver-based Planning

1. Replace the outside consultants

Enterprise FP&A software often relies on complicated scripting that sets a high bar for learning to modify the simplest change – even for an Excel wiz. As a result, many companies rely on outside consultants to write complex formulas to build (and inevitably, to update) their models.

‍This takes away ownership from your team, and it’s very expensive. Distancing yourself from the process with a consultant means that you may not learn the underlying formulas they built to deliver on your assumptions.

“When I worked as a financial analyst with a different FP&A tool, I would always forget how to perform simple functions if I wasn’t regularly in the platform. 
My experience with Stratify is different. When I log in I can easily see and remember how to quickly modify an assumption behind an expense, even if it’s been a while.” 
Stratify user, Technology Company

Alternatively, driver-based forecasting platforms, with intuitive, configurable business logic, like Stratify, actually give you more ownership over your models, without the need to maintain the formula logic or manage the inevitable complexity of frequently expanding models.

Instead of calling your consultant or admin to add a growth factor for inflation for expenses, you can grab that driver from the bank in Stratify and apply it to your scenario or plan.

This transparency will boost your confidence as an analyst and prevent detrimental knowledge loss if that skilled admin leaves your business. Stratify equips you to build and adjust your own models and confidently share them with stakeholders.

2. Minimize human errors

As finance pros, we take pride in being the ones who can deliver scenarios for the leadership team that no one else can, built from scratch in a complex spreadsheet. But we’re hesitant to admit that manual modeling is error-prone. If you're planning in spreadsheets, switching to a 3rd gen FP&A tool can prevent those costly errors.

‍We see this firsthand in our configuration process. The initial migration to Stratify involves our success team partnering with customers to rebuild their existing plan(s) in our platform. We configure our business logic based on their unique requirements to build and validate their model in Stratify.

‍“My team has discovered formula errors in almost all of our customers’ plans! When we configure a customer’s plan in Stratify and it doesn’t match their plan, it’s usually because of an error in the customer’s model – an incorrect formula assumption hidden deep in a spreadsheet somewhere, but no one knows it's there.” 
Quy Dong, Head of Customer Success at Stratify

We all know how easy it is to make a formula error that will set you down the wrong path. Stratify delivers accuracy from the start and eliminates the fat-finger errors that every analyst fears. We’ve found this combination of human expertise plus powerful technology to be unbeatable.

3. Retain flexibility
In Stratify, driver-based planning dovetails with a familiar spreadsheet interface for ultimate flexibility. This is the ideal place for ad hoc modeling (like modeling the impact of various levels of marketing spend, or sales hiring) before you adjust the assumptions in your business plan. You can also develop monthly reporting packages customized for stakeholders. The major difference is that, unlike Excel or Google Sheets, these spreadsheets are connected to your real-time financial and workforce data to maintain accuracy. 

4. Easy for the whole team to understand

Strategic finance requires a collaborative planning process, but both legacy FP&A tools and spreadsheets make collaboration difficult. Stratify makes it easy for finance and other business users to understand the context behind the numbers in the plan. One click reveals plan assumptions in “plain English” in a sidebar. No one needs to decode complex formulas.

For example, in this image below of a Travel & Entertainment expense assumption, it is easy for anyone to understand that it is headcount-based and the current monthly planning rate is $275.

Adjusting T&E expense for the Sales Department in an OpEx plan in Stratify

5. One integrated plan

Modern businesses need the finance function to be like an air traffic controller, coordinating the flow of operational and financial information across the business. When you break down data silos and incorporate your GL, CRM, and HRIS data into Stratify, any changes to headcount, OpEx, or revenue assumptions will flow into the financial plan, so nothing gets overlooked. 

FP&A plans are constantly changing and analysts are great at bringing order out of the chaos. But teams who plan in complex, disconnected spreadsheets are feeling the pain.

A platform like Stratify provides a better experience – a collaborative way to plan where you won’t need to write every formula, search for errors, and email the 17th version of a budget spreadsheet back & forth across departments.

“Before Stratify, we were doing everything on Excel. People couldn’t collaborate in one tool and in one version at the same time. It was very hard for us to plan. Now I have more time to do more value-added work.“ 
Tina Lai, Finance Manager at Spotnana 

Read the Spotnana Customer Story 

Is Driver-based Modeling Right for You?  

If your FP&A team is stuck in a reactive approach to budgeting and planning, then driver-based modeling is the change you need to break the cycle.

Stratify is an ideal next step for teams who are frustrated with legacy FP&A tools and want to give ownership back to their finance team. It's also a great fit for FP&A teams who are tethered to spreadsheets and want to incorporate all business data for a clear view of the trends and opportunities across all areas of the business. Stratify provides the starting point for accurate, collaborative plans and forecasts you can share with stakeholders for strategic decision-making. 

We’re convinced that once you see and feel the difference of planning with configurable drivers, you’ll never want to go back. Get in touch today to take a look inside Stratify. 

It may seem like a leap of faith to pull your opex or workforce plan out of spreadsheets or a legacy FP&A solution, and switch to a 3rd gen FP&A tool to plan. But in our experience, concerns about control and customization are quickly resolved when finance teams see and feel the difference in their workflow (and stress levels!) 

Last Updated:
July 4, 2024

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