Financial planning, also known as connected enterprise planning, allows businesses to model strategic direction and take actions to optimize financial and business performance. This approach is forward looking and used to help finance guide the business to achieve its strategy. Financial planning encompasses long-range plans, scenario modeling, annual budgeting and forecasting, ad-hoc reporting, and analysis.
Finance uses financial planning to communicate the overall company strategy and goals to the lines of business and operations. Finance is a business partner and works with other areas to develop annual plans, such as sales and marketing plans, project plans, workforce plans, and other operational planning initiatives that contribute to the financial goals of an organization.
Over the past few years, financial planning has evolved from a periodic activity into a continuous process that takes into account historical performance, adjusting drivers along the way to make sure a company stays on target to achieve its financial goals. To accommodate this change, financial planning applications need to align with other systems, such as HCM, ERP, supply chain, and operations, to build plans for a connected view of the whole organization.