If your clients are still in the Excel era, they've got plenty of company. But they may find cloud computing provides more nimble forecasting of their business needs. That's a key finding in an online survey in April of 325 financial professionals by Adaptive Insights in Palo Alto, Calif., which provides cloud-based business and financial analytics solutions for more than 2,200 customers worldwide. Even Adaptive found the number of Excel users surprising, says company senior vice president of marketing Greg Schneider.
Released this month, the survey report indicates that 86 percent of respondents would prefer not to use legacy systems. But of those, 46 percent want Excel while 40 percent opt for the cloud.
Yet that Excel use is why 60 percent of companies say they re-forecasted or created "what if" scenarios only zero to two times in the last six months, Schneider says. And that's not often enough.
"The best practice in the marketplace right now is to move to rolling forecasting, which means that you do reforecasting monthly for the next 12 to 18 months", he says. But Excel's manual process means users can't respond as quickly to rapidly changing business scenarios, Schneider continues.
"We've moved beyond annual budgets and then mid-year forecasting", he says. "So those [reforecasting] numbers are lower than you would expect and they reflect the use of Excel versus more modern automated solutions."
Along those lines, only 27 percent of respondents said they could respond or re-forecast in days to an external or internal impact on their business. The majority (73 percent) said it would take weeks or months.
So what kind of internal or external factors are we talking about that could affect businesses through December?
Externally, 49 percent cited the Affordable Care Act and a rise in gas prices, and 25 percent said the current hurricane season and upcoming midterm elections. The bulk of internal problems (43 percent) included executive changes and mergers and acquisitions, and 27 percent cited new hires and layoffs.
The takeaway here, Schneider says, is that "we live in a very dynamic environment with a lot of changes in business. What we're seeing is that the interest in solutions is driven by the need for companies to be more nimble and agile. So if there are any kind of changes in underlying economics or drivers, companies need to respond and understand how it'll impact their cost structure and demand."
And if companies can do that, and put together scenarios about these potential changes, they'll be one-up on their competitors, he adds.
So whether your clients are in the Excel or cloud camp, we'll bet a competitive advantage is a goal they've all got in common.