Build Greater Resiliency Through Integrated Business Planning 5 min read By Kerry Buchar and Lucas ManganaroImagine this scenario: What if businesses had the ability to model the impacts of consumer isolation during the height of the COVID-19 pandemic and tailor their strategic decisions accordingly? The past few years have ushered in what some might argue are even more challenging market conditions. Business leaders increasingly are recognising that integrated business planning (IBP) is essential for navigating market volatility and building resilience. By aligning planning and execution across sales, finance, supply chain, sourcing, procurement and operations, IBP enhances profit and cash flow while mitigating risk.IBP programs often originate with financial planning and analysis (FP&A) leaders, who are called on to inform leadership with forecasts and business insights. In Protiviti’s most recent CFO survey, FP&A, profitability, reporting and analysis, strategic planning, enhanced data analytics and process improvement were identified as top areas where CFOs are seeking to improve capabilities. All of these are relevant to IBP as well as to generating better insights, not only to define near-term tactics, but also to inform longer-term strategic planning.The volatility we’ve come to know drives the need for greater resiliency, agility and flexibility. FP&A cannot achieve this alone. No single function will have all the answers – nor the data or business expertise – to address complex business forecasting challenges. But organisations that embrace IBP can manage them by developing cross-functional collaboration along with process and systems maturity to achieve visibility and transparency throughout the enterprise. Topics Business Performance The effectiveness of IBP hinges on the strength of its underlying foundationA major challenge to IBP success is harmonisation of functions across the organisation, particularly between finance and supply chain. Over time, each function may have developed its own language or have its own variation in the maturity of its data, processes and technology. For IBP to be effective, all functions must commit to ongoing collaboration, overcoming cultural differences and understanding each other’s objectives and constraints. Building awareness and educating various business functions about the key priorities of each will help overcome the typical roadblocks encountered, enabling groups to build an integrated business plan collaboratively and revise the plan as needed to respond to a changing environment.Process improvement is also essential, because it results in defined handoffs between functions and ensures all parties are aware of their roles and responsibilities. Standardising and rationalising processes and instituting a governance structure over the end-to-end IBP process also helps reduce or eliminate duplication of efforts. Developing maturity across functions helps support a strong foundation, which is critical to IBP success.Automation is another key to increasing organisational agility, building flexibility in reporting and enhancing planning capabilities. Automation between systems reduces manual work to improve efficiency and reduce errors. Depending on the company’s technology strategy, various solutions can offer a foundation for IBP that delivers timely, agile scenario-planning capabilities that are needed as part of IBP. Additionally, supply chain platforms can provide a unified view of enterprise data gathered from multiple point solutions and provide a solid basis for automation. However, a common misstep is automating flawed processes. Therefore, organisations need to examine and correct any outdated or imperfect processes before automating them.Many leaders leverage digital-process twins as a mechanism to adjust processes and then conduct simulation and scenario modeling to better understand how processes will perform under changing constraints. Such simulations can help mitigate potential risks and plan responses in advance of events that result in volatility. Data analytics and digital twins are solutions that rely on quality data to deliver those capabilities. These solutions are now more accessible than ever, and they often include user-friendly front ends that enable nontechnical professionals to simulate scenarios in plain language.Some leaders look to artificial intelligence (AI) for its promise to deliver better information faster. Practical applications in the planning realm, however, are currently limited. While AI promises much in predictive analytics, IBP leverages descriptive analytics: accurate, real-time views that improve production planning, supplier communications, and production and distribution capabilities. Those improvements can’t proceed without a solid view of what’s happening today.Keep in mind that automation, data analytics, digital twins and other solutions are only as good as the data they consume. Some leaders elect to establish centres of excellence that provide governance over data analytics and take charge of reporting and data rationalisation enterprisewide. Some include heightened business knowledge in the centre’s skill set. These data analytics centres of excellence analyse enterprise information needs and identify data sources to meet them.Collaboration will overcome forecasting hurdlesC-suite leaders, along with their boards, are navigating an increasingly volatile future. Yet IBP offers a transparent methodology to assess organisational challenges and risks. The true strength of IBP emerges when various functions collaborate to create aligned forecasts, supported by robust processes, systems and high-quality data. This approach unlocks profound insights, delivering the resilience and agility needed to thrive in unstable conditions.