Financial Planning for Strategy

CEO: Our margins are getting tighter. FP&A: Let’s cut costs. CEO: We’re missing revenue targets. FP&A: Let’s reforecast. CEO: Our cash flow is unpredictable. FP&A: Let’s track it closer. CEO: We’re losing market share. FP&A: Let’s adjust assumptions. This is how finance becomes a back-office function. And it’s why most FP&A teams get ignored in strategy meetings. Instead, try this: 1. Turn data into decisions, not just reports CEOs don’t need more charts. They need answers. If your reports don’t drive action, they’re just noise. FP&A teams that translate numbers into clear next steps get a seat at the table. 2. Make forecasting dynamic, not static Annual budgets are already outdated by Q2. Winning teams run rolling forecasts that adapt in real-time, using leading indicators to predict what’s next, before the business feels the impact. 3. Use capital as a competitive advantage The best companies don’t just cut costs, they allocate capital better. Instead of reacting to margin pressure with blanket cuts, double down on high-ROI opportunities and phase out low-value spending. 4. Speak the language of business Finance gets ignored when it talks in numbers, not outcomes. Saying, “Gross margin fell by 2%” misses the mark. Saying, “Optimizing pricing can recover $5M in profit next quarter” gets action. 5. Don’t wait for leadership to ask The best FP&A teams don’t wait. They anticipate challenges, model different scenarios, and push strategic moves before the company is forced to react. Influence happens when finance drives the conversation, not follows it. The FP&A teams winning in 2025 aren’t managing costs. They’re out-executing their competitors. FP&A sees what’s coming first. Follow Erik Lidman for FP&A insights.

𝗛𝗼𝘄 𝗘𝗻𝘁𝗲𝗿𝗽𝗿𝗶𝘀𝗲 𝗔𝗿𝗰𝗵𝗶𝘁𝗲𝗰𝘁𝘂𝗿𝗲 𝗕𝗮𝗹𝗮𝗻𝗰𝗲𝘀 𝗦𝗵𝗼𝗿𝘁-𝗧𝗲𝗿𝗺 𝗡𝗲𝗲𝗱𝘀 & 𝗟𝗼𝗻𝗴-𝗧𝗲𝗿𝗺 𝗚𝗼𝗮𝗹𝘀 EA gets caught between the 𝗶𝗺𝗺𝗲𝗱𝗶𝗮𝗰𝘆 𝗼𝗳 𝗲𝘅𝗲𝗰𝘂𝘁𝗶𝗼𝗻 and the 𝗶𝗺𝗽𝗲𝗿𝗮𝘁𝗶𝘃𝗲 𝗼𝗳 𝘀𝘁𝗿𝗮𝘁𝗲𝗴𝘆. Some orgs embed EA into SA roles so projects meet current demands. Others make EA a billable function, tying value to immediate deliverables. Both approaches bring risks: ➡ When SAs wear EA hats, decisions are localized rather than strategically aligned, risking fragmented technology landscapes. ➡ When EA is billable, there’s pressure to justify work through short-term project outcomes over enterprise-wide impact. To drive transformation, EA must be a 𝘀𝘁𝗿𝗮𝘁𝗲𝗴𝗶𝗰 𝗳𝘂𝗻𝗰𝘁𝗶𝗼𝗻, 𝗻𝗼𝘁 𝗷𝘂𝘀𝘁 𝗮𝗻 𝗲𝘅𝗲𝗰𝘂𝘁𝗶𝗼𝗻 𝗹𝗮𝘆𝗲𝗿. Here are 3 Ways EA Balances The Short- and Long-Term: 𝟭 | 𝗘𝗺𝗯𝗲𝗱 𝗘𝗔 𝗶𝗻 𝗦𝘁𝗿𝗮𝘁𝗲𝗴𝘆, 𝗡𝗼𝘁 𝗗𝗲𝗹𝗶𝘃𝗲𝗿𝘆 EA shouldn’t just validate solutions—it should shape them. 𝙃𝙤𝙬?  ✔ Engage EA in strategy to align roadmaps with business goals.  ✔ Ensure decisions are more than tactical—connect them to enterprise-wide outcomes.  ✔ Establish EA governance so short-term decisions don't create long-term complexity. 📊 EA works best defining the guardrails—not just reviewing outputs. 𝟮 | 𝗕𝗮𝗹𝗮𝗻𝗰𝗲 𝗜𝗻𝗻𝗼𝘃𝗮𝘁𝗶𝗼𝗻 𝗪𝗶𝘁𝗵 𝗦𝘁𝗮𝗯𝗶𝗹𝗶𝘁𝘆 Orgs need speed to stay competitive—but not at the cost of architectural integrity. 𝙃𝙤𝙬?  ✔ Iterative architecture allows for agile decision-making while maintaining long-term vision.  ✔ EA assesses the impact of emerging technologies before disrupting existing structures.  ✔ Use reference architectures and patterns to ensure scalability while allowing for flexibility. 🔄 EA helps businesses move fast—without breaking the foundation. 𝟯 | 𝗠𝗲𝗮𝘀𝘂𝗿𝗲 𝗘𝗔’𝘀 𝗜𝗺𝗽𝗮𝗰𝘁 𝗕𝗲𝘆𝗼𝗻𝗱 𝗜𝗺𝗺𝗲𝗱𝗶𝗮𝘁𝗲 𝗗𝗲𝗹𝗶𝘃𝗲𝗿𝗮𝗯𝗹𝗲𝘀 If EA is only evaluated by project success, its strategic influence diminishes. 𝙃𝙤𝙬?  ✔ 𝗧𝗶𝗲 𝗘𝗔 𝗺𝗲𝘁𝗿𝗶𝗰𝘀 𝘁𝗼 𝗯𝘂𝘀𝗶𝗻𝗲𝘀𝘀 𝗽𝗲𝗿𝗳𝗼𝗿𝗺𝗮𝗻𝗰𝗲, not technical implementation.  ✔ Define KPIs that reflect cost savings, agility, and risk reduction.  ✔ Showcase EA’s role in long-term value creation, beyond project timelines. 🎯 EA’s success isn’t just about what gets built today—it’s about what remains sustainable tomorrow. 𝗧𝗮𝗸𝗲𝗮𝘄𝗮𝘆 Enterprise Architecture isn’t a support function—𝗶𝘁’𝘀 𝗮 𝘀𝘁𝗿𝗮𝘁𝗲𝗴𝗶𝗰 𝗲𝗻𝗮𝗯𝗹𝗲𝗿. 𝗪𝗵𝗲𝗻 𝗲𝗺𝗯𝗲𝗱𝗱𝗲𝗱 𝗶𝗻𝘁𝗼 𝗯𝘂𝘀𝗶𝗻𝗲𝘀𝘀 𝗹𝗲𝗮𝗱𝗲𝗿𝘀𝗵𝗶𝗽, 𝗘𝗔 𝗲𝗻𝘀𝘂𝗿𝗲𝘀 𝘁𝗵𝗮𝘁 𝘀𝗵𝗼𝗿𝘁-𝘁𝗲𝗿𝗺 𝘄𝗶𝗻𝘀 𝗱𝗼𝗻’𝘁 𝗰𝗼𝗺𝗲 𝗮𝘁 𝘁𝗵𝗲 𝗰𝗼𝘀𝘁 𝗼𝗳 𝗹𝗼𝗻𝗴-𝘁𝗲𝗿𝗺 𝘀𝘂𝗰𝗰𝗲𝘀𝘀. _ ➕ Follow Kevin Donovan, ring the bell 🔔 👍 Like  |  ♻️ Repost _ 🚀 Join Architects' Hub!  Sign up for our newsletter. Connect with a community that gets it. Improve skills, meet peers, and elevate your career! Subscribe 👉 https://lnkd.in/dgmQqfu2 #EnterpriseArchitecture #DigitalTransformation

Do you walk into board meetings with a slide deck? Or with an executive finance pack? One tells a story. The other drives a decision. A slide deck tells a story you want the board to hear. A finance pack gives the board what it needs to govern, challenge, and approve. If your board isn't asking hard questions, it's not because things are going well. It's because the information you're presenting doesn't invite rigor. And that’s a governance problem. Here's how to build a board-ready finance pack, from the foundation up: LEVEL 1: Strategic Thesis ↳ What is the company's capital strategy and where is value being created? ↳ This is the anchor. Every number in the pack should trace back to this thesis. LEVEL 2: Capital Allocation ↳ How is capital being deployed across the business? ↳ Show where dollars are going, why, and what return profile each allocation carries. LEVEL 3: Cash Position ↳ What is the real-time liquidity picture? ↳ Not just the balance. The runway, the burn context, the covenant headroom, the collection cycle. LEVEL 4: Scenario Map ↳ What happens if assumptions shift? ↳ Give the board two or three scenarios with clear triggers, trade-offs, and decision points built in. LEVEL 5: The Board Asks ↳ What questions should the board be asking based on this data? ↳ Pre-frame the governance conversation. Guide their attention to what matters most right now. Most mid-market CEOs build from the top down.  They start with what the board might ask and reverse-engineer a defensive narrative. That's backwards. When you build from the thesis up, every layer reinforces the one below it. The numbers have context.  The scenarios have grounding.  The questions have depth. Investor-grade governance doesn't require a Fortune 500 finance team. It requires a structure that makes the right conversations inevitable. If your board leaves the room without challenging a single assumption, the pack failed. Not the Board. Great CEOs don't just report to their boards.  They equip them to govern. That's financial intelligence at the leadership level. ♻️ Like, Comment and Repost to help your network. Follow Oana Labes, MBA, CPA for strategic financial leadership. -------- 📌 Ready to Scale with Full Command of your Own Numbers? Join The CEO Financial Intelligence Academy. 5* Curriculum. Coaching. Community. Your CEO Dashboard set up Day 1. Get your CEO Checklist here → https://bit.ly/4es64ye

𝐅𝐢𝐧𝐝𝐢𝐧𝐠 𝐢𝐭 𝐡𝐚𝐫𝐝 𝐭𝐨 𝐦𝐚𝐧𝐚𝐠𝐞 𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐫𝐢𝐬𝐤 𝐟𝐨𝐫 𝐲𝐨𝐮𝐫 𝐒𝐌𝐄? As someone who's navigated the ups and downs of running and advising small and medium-sized enterprises (SMEs), I know that identifying and managing financial risks is crucial for your business's health and growth. Let's delve into some key strategies: Understand Your Cash Flow: Keep a close eye on your cash flow. Surprisingly, 82% of SME failures are due to poor cash flow management. Regular Financial Audits: Conducting regular audits can help identify potential risks early. Remember, prevention is better than cure. Diversify Revenue Streams: Don't put all your eggs in one basket. Diversification can reduce dependency on a single source of income, which is vital as market trends shift. Stay Informed on Market Trends: Keeping up with market trends is essential. This knowledge can help you anticipate and prepare for potential financial downturns. Invest in Good Insurance: Insurance can be a lifesaver in mitigating unforeseen risks. Consider different types of insurance to cover various aspects of your business. Create a Risk Management Plan: Have a solid plan in place. Only 50% of SMEs have a risk management plan, yet those who do are 28% more likely to experience growth. As we navigate the ever-changing business landscape, remember that managing financial risk is not just about avoiding pitfalls; it's about empowering your business to thrive in uncertainty. Looking forward to your insights and strategies on this! ________________________________ Check out my website and podcast. Link in the comments. #FinancialRiskManagement #SMEGrowth #Facts #BusinessStrategies #EconomicResilience #Entrepreneurship

"Should we hire or should we cut?" is a question I'm hearing often from small business owners right now, which is fair given the mixed economic signals. Some clients are seeing their best quarters ever. Others are watching pipelines thin out. Everyone seems to be asking, "How do we plan for what we can't predict?" This is where scenario planning becomes your survival tool; not just hoping for the best, but modeling the reality of different futures. Here's what we walk our clients through: 🌳 The Growth Scenario: For example, if revenue is expected to be up, we’re looking at potential team expansion and higher overhead. Looking at what that does for cash flow given the changes to expected expense changes. 🌱 The Steady Scenario: Where flat growth is expected and we plan to maintain current team, we’ll want to optimize margins and prepare for inevitable per team member increases. There will likely be some percentage increase YOY but we expect the core costs to stay the same. 🍃 The Contraction Scenario: On the other hand, if revenue is expected to go down, we want to look at strategic cuts that allow the team to run efficiently while preserving cash. For our clients, this is usually a mix of team, professional services, and travel. We also want to ensure that the resources kept are used efficiently. Each scenario gets its own financial mode where we map out cash flow, runway, and break-even points for 3, 6, and 12 months ahead. The command center for this? Fathom. We've been using Fathom since the beginning of Little Fish Accounting and it lets us build the scenarios in real-time with clients, showing exactly how each decision ripples through their financials. No more spreadsheet gymnastics or gut-feeling guesses. Ultimately, the founders who survive uncertainty aren't the ones with crystal balls—they're the ones with clear models and decisive action plans. And we're glad to be the builders 🧱

You work too hard to let hidden inefficiencies drain your wealth. I’ve worked with top entrepreneurs for 25 years, and I see the same issue: High-earning business owners leave millions on the table without realizing it. Why? Their financial strategy is disjointed. → Your CPA files your taxes but isn’t proactive. → You’ve tested tax strategies, but they feel scattered. → Your financial advisor doesn’t understand the complexities of business income. → You have separate experts for taxes, investments, and business structure—but they don’t work together. The result? Wealth leakage. You wouldn’t run your business without a strategy—so why treat your finances any differently? Earning more isn’t the issue—keeping more is. The tax code favors business owners who structure things correctly. But without a cohesive plan, you're overpaying in taxes, Missing investment opportunities, and failing to turn income into lasting wealth. If your financial plan isn’t working as hard as you are, it’s time to fix that.

Critiquing the Development of a Funding Plan: Its Theory, Practice, and Strategic Interaction Understanding the intricate dynamics between the development of a funding plan and its interaction with both the wider finance operating plan and strategic plan is essential for any banking professional. The theory behind developing a funding plan often emphasises structured, predictive frameworks that rely heavily on historical data and forecasting methods. In theory, these plans are designed to ensure liquidity and support strategic objectives with conservative yet sufficient funds allocated where they are projected to be most beneficial. However, the practical application of these theories in real-world scenarios often presents a different narrative. In practice, the alignment of the funding plan with the strategic and financial operating plans can be fraught with challenges. These include fluctuating market conditions, regulatory changes, and unexpected shifts in business strategy. Although the theory suggests a seamless integration, the practicalities require adaptive management and real-time decision-making to handle the complexities of the financial environment. Moreover, the interaction between the funding plan and the organisation's strategic plan is a critical area that requires a pragmatic approach. This interaction is not just beneficial; it is crucial for the long-term sustainability of the organisation. A well-integrated plan aids in the precise allocation of resources, enhancing the organisation's ability to achieve its strategic objectives efficiently. However, misalignment between these plans can lead to resource constraints or inefficient capital use that might impede strategic goals. It is therefore prudent for financial strategists and planners to not only devise realistic and flexible funding plans but also continuously evaluate and adjust these plans in alignment with the overarching strategic goals and the prevailing economic conditions. This ongoing adjustment ensures that the practice of funding planning remains as close to its theoretical ideal as possible, thus maximising the strategic benefits for the organisation. This critique shows that while theoretical frameworks provide a foundational understanding, the real-world application demands a more dynamic and responsive approach to manage the interaction between various financial plans effectively. This understanding is crucial for anyone involved in the financial planning and strategic management sectors, highlighting the need for an adaptive, informed, and strategic approach in financial management.

Our latest research with ESW reveals a tipping point: for more than half of UK retail exporters, trade with the US becomes commercially unviable if tariffs rise above around 21 per cent. Through modelling and retailer interviews, our US tariff sensitivity model shows: 💥 Larger retailers can lean on scale advantages, but most say that if tariffs hit 23.8 per cent, trade becomes commercially unviable as structural advantages erode. 💥 Smaller retailers face the cliff-edge at just 20.9 per cent. Even more concerning, 71 per cent admit they have no formal action plans in place to manage sudden policy shifts. 💥 Resilience gaps are already clear. At today’s 10 per cent tariff levels, UK exporters are absorbing £618.5m in additional costs, with one in ten finding their US proposition unviable. Our research shines a spotlight on these challenges for UK businesses, as we head into a more uncertain and dynamic trade environment. The reality is that the UK economic outlook remains challenging. The cost of living is a key concern, unemployment is rising, and consumer spending is lacklustre. Internationalisation has risen up the agenda for many retailers who are looking to alternative markets in the search for growth. The uncertain trading environment with the US has been a catalyst for many to explore other markets. Three implications stand out: 🔴 Even the strongest operators become exposed if US tariffs reach 24 per cent. 🔴 Boards must embed scenario planning into the core of strategy to adapt to a more dynamic trade environment. 🔴 Global expansion must be stress-tested against volatility. In reality, global ambitions are fragile without agility. The retail winners will be those who can effectively scenario plan and stress test, seeking out international growth markets that match their ambitions. Find out more in our new report with ESW: https://lnkd.in/eVuYvkcb

Have you considered how an excessive focus on cost reduction might be undermining your organization's future success? As a CFO in healthcare management, I've witnessed firsthand how the delicate balance between cost control and strategic investment shapes long-term business sustainability. The impact of solely focusing on cost-cutting measures requires careful examination across multiple dimensions: Operational Considerations: → Innovation Impact ↳ Reduced R&D funding ↳ Limited technological advancement → Employee Effects ↳ Decreased morale ↳ Higher turnover rates ↳ Reduced productivity → Customer Experience ↳ Service quality degradation ↳ Diminished satisfaction levels Strategic Implications: → Market Position ↳ Weakened competitive advantage ↳ Lost market opportunities → Growth Potential ↳ Limited expansion capabilities ↳ Reduced market adaptability Balanced Approach Requirements: → Strategic Investment Areas ↳ Technology infrastructure ↳ Employee development ↳ Customer experience enhancement → Cost Optimization Methods ↳ Process efficiency improvements ↳ Smart automation implementation ↳ Strategic sourcing initiatives In healthcare organizations, maintaining this balance is particularly crucial due to: → Quality of Care Requirements ↳ Patient safety standards ↳ Regulatory compliance needs → Staff Retention Importance ↳ Specialized skill requirements ↳ Training investment needs The key to sustainable growth lies not in aggressive cost-cutting but in strategic resource allocation. Are your cost management strategies aligned with your long-term growth objectives? Let's explore how to create a more balanced approach to financial management in your organization.

Are your programs making the impact you envision or are they costing more than they give back? A few years ago, I worked with an organization grappling with a tough question: Which programs should we keep, grow, or let go? They felt stretched thin, with some initiatives thriving and others barely holding on. It was clear they needed a clearer strategy to align their programs with their long-term goals. We introduced a tool that breaks programs into four categories: Heart, Star, Stop Sign, and Money Tree each with its strategic path. -Heart: These programs deliver immense value but come with high costs. The team asked, Can we achieve the same impact with a leaner approach? They restructured staffing and reduced overhead, preserving the program's impact while cutting costs by 15%. -Star: High impact and high revenue programs that beg for investment. The team explored expanding partnerships for a standout program and saw a 30% increase in revenue within two years. -Stop Sign: Programs that drain resources without delivering results. One initiative had consistently low engagement. They gave it a six-month review period but ultimately decided to phase it out, freeing resources for more promising efforts. -Money Tree: The revenue generating champions. Here, the focus was on growth investing in marketing and improving operations to double their margin within a year. This structured approach led to more confident decision-making and, most importantly, brought them closer to their goal of sustainable success. According to a report by Bain & Company, organizations that regularly assess program performance against strategic priorities see a 40% increase in efficiency and long-term viability. Yet, many teams shy away from the hard conversations this requires. The lesson? Every program doesn’t need to stay. Evaluating them through a thoughtful lens of impact and profitability ensures you’re investing where it matters most. What’s a program in your organization that could benefit from this kind of review?