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Case Study: An FP&A Director Helps Her Company Achieve Integrated Planning

  • By John Hintze
  • Published: 7/26/2017

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In 2015, facility management provider ABM Industries’ new CEO and CFO took the reins and embarked on a new strategic course to unlock value in the company. As part of this tactical shift, senior management made a commitment to increase the company’s margins by 100 basis points over the next three years.

As a public company, ABM’s processes for financial reporting and budgeting and planning were already satisfactory. However, as ABM has grown over the years, in part through significant acquisitions, it has faced challenges around integrating disparate systems and producing effective managerial reports.

Connecting the processes

When Kayla Davis started as director of financial planning and analysis (FP&A) at ABM two years ago, she quickly realized that disparate systems and financial planning methods used in the finance department would be a hindrance to change. Connecting those processes so data could be easily shared and worked with was a clear necessity; nevertheless, it took nearly two years to get the project moving.

“I first had to justify to the CFO why we should make this investment since we could already get the numbers. Was it really worth it?” Davis said.

To connect the financials and planning process to ABM’s new strategic vision, FP&A built data models leveraging historical financial information, along with assumptions around the new operational initiatives, with the goal of incorporating a targeted margin increase into the company’s long-term plan. But data was stored in Excel files, limiting the bottoms up/top-down communication and analysis required to explore different approaches.

“The finance team was asked to think differently, and given the demands at the time and expected to come, it became very apparent that the way we were doing things wouldn’t be fast enough for us to get the answers we needed,” Davis said. “I knew then that we needed one platform where everybody throughout the organization can view information in the same way and communicate about it more quickly.”

A new system

A more efficient system to integrate and use data would be necessary to speed up the process. Looking into third-party solutions, Davis was initially overwhelmed by the number and variety of options. A key early requirement was simplicity of use and having everyone in the finance department on the same platform. “Once everyone is using the same platform, it makes integrated planning that much easier,” she said.  

ABM is pursuing a “center of excellence” approach by piloting a technology solution in the finance department as well as with an industry group that has historically been progressive in terms of embracing new technology. Davis anticipates a year-long implementation, with the goal of gaining institutional support from this first deployment, developing internal expertise and adapting the tool and the teams. Then she can expand platform access to other departments.

“We’re hoping that once it’s done, the industry group will really be an advocate for the technology,” said Davis.

Key benefits

In terms of anticipated benefits, she said, FP&A worked with a vendor to do a proof-of-concept last year to determine the likely impact, conducting two pilots using small subsets of data from two different groups. One looked at aggregating financial information and allowed for queries in real time, and the other looked at the lowest level, where operators are inputting data, currently a time-consuming process that takes away from servicing customers.

The new tool automatically populates data tables, reducing manual work and supplying the most current data for analysis. The data is entered hierarchically so that it can be aggregated and disaggregated based on the item being studied.

“With historical and budget data being loaded, I could quickly see trends of how a subset of data or a book of business is doing, and I could easily drill down to see trends related to specific customers and make queries about them,” Davis said.

She added that the proof of concept also enabled “what if” scenarios—for example, what increasing margins for a specific customer would mean for the entire portfolio.

Currently, ABM is applying integrated planning solutions to make financial planning easier, reducing time to do forecasts and budgets. Soon after that’s completed, the company’s sales force will proceed with its own data. Also on the docket are departments such as HR, whose data feeds planning systems. Sales data, Davis said, could eventually be integrated into FP&A’s planning process.

Follow in ABM’s footsteps and achieve their same success. Let the AFP FP&A Guide to Building an Integrated Business Planning Capability, underwritten by Anaplan, help you reach your organizational goals.
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