5 reasons why you should invest in Integrated Business Planning now for a better future
25 May 2021
During times of change and uncertainty, the prevailing wisdom is to batten down the hatches and ride out the storm. While this wisdom may serve you well out on the open seas, it is the opposite of what businesses need to be doing right now.
Paradoxically, there has never been a better time for businesses to make aggressive changes in strategy, break into new sectors, or launch new brands. You only have to look at the advent of Uber and Airbnb coming out of the 2008 recession to see two good examples of this. While some businesses will be trying to ride out the storm and lose, others will be trying new things and potentially winning big.
Organizations that operate using Integrated Business Planning will be better placed to see these changes happening and to reap the rewards.
Here are 5 reasons why you should invest in Integrated Business Planning now for a better future:
- With Integrated Business Planning, the focus of the Executive Team will shift from dealing with the unplanned, short-term events that are affecting the business today, to a more strategic horizon. This will enable the team to assess changes in the market dynamic before they happen and to develop suitable scenario plans in time to enjoy the benefits.
- Developing and monitoring substantive, timebound, and quantified assumptions about the future will lift the level of debate amongst the Executive Team. These assumptions will cover significant future issues like:
- The changing political landscape, international trade agreements, taxes, and sanctions that will affect the market in the future.
- Consumer trends which tend to change rapidly in times of uncertainty. History has shown that people are more likely to try new things and adopt new habits when the environment around them is changing. The acceleration of online shopping during the pandemic is a great example.
- Assumptions about the competitive landscape will identify where the strengths and weaknesses are in the supply chains of current competitors leading to opportunistic benefits for those organizations that see competitors that are struggling.
- The formal use of Vulnerabilities and Opportunities, as used by an organization that has an Integrated Business Planning process, will create early transparency across the business on these issues and enable the business to prepare for the potential changes in a controlled and effective way. When a commercial function seizes on the big new opportunity without having given early visibility to the supply chain, the opportunity is often lost.
- With a greater focus on Portfolio Management, the organizations with Integrated Business Planning will have the agility and the foresight to make changes to the shape of their portfolios to exploit the changing market dynamics. Seeing a gap open up in the market as a result of these changing dynamics, and having the appropriate processes, tools, and behaviours to quickly develop and launch a product to fit the gap will undoubtedly drive for a better future.
- With a greater focus on integrating the short-term control processes with the longer-term business planning processes, organizations will be able to learn from what is actually happening in the marketplace today at the point of sale and use this knowledge to inform the planning decisions that they are making about the future. This is particularly relevant in times of change as the behavior of the consumer tends to shift rapidly. Trends towards cheaper brands or a change in the frequency and volume of consumer purchases will be most noticeable at the point of sale.
So, while the current environment is stirring up the winds of change, it will also be opening up opportunities that can be exploited if an organization can spot the changes and act quickly. Are you going to batten down the hatches and potentially go down with the ship? Or are you going to invest in Integrated Business Planning now for a better future?