Making Financial Forecasting Easier On You and Your People

Financial forecasting is a necessity. It’s what gives you visibility into what you need to see to run your business—and help it grow. You can always expect the unexpected in a growing business, so you need to be adaptable to change. When you know about pending changes in advance, you can build them into your forecast. Then they won’t have a way to blindside you or hold you back. The big challenge is that getting forecasting done accurately and on time when it’s a constant and ongoing need can feel pretty impossible and cumbersome.

Forecasting involves a ton of data points to manage, and if you’re scrambling for it in multiple systems, or your system doesn’t give you the data points you are looking for, you’re not going to get an accurate picture like you need to. Chasing down data can be a challenge, but having the data is a huge asset.

Bring It Into Your Culture

As a leader, if you’re trying to be great at financial forecasting, you tend to get resistance around gathering the data you need as often as you need it from your team. The ideal way to overcome this is to start to create a culture built around the expectation that all of the necessary data is always updated and offered up as quickly as possible.

To do this, you need to train your teams so they perceive the process of gathering and sharing data on a regular cadence as helpful vs being micro management. The culture then becomes one of “We need the right information/data to run the company well and keep the details running smoothly.” Once everyone sees the value of this culture of full transparency and regular data sharing, it’s easy for them to then see how worthy of an endeavor it is and keep it going on a cadence. How you manage the cadence around gathering the data you need can help you manage the heavy lift of forecasting.

The point you want to get to is to make this part of how you run your business. It should become included in every new deal so that it is a key structural unit that helps you manage your ups and downs.

Use The Right Tools

Having the right software can make or break your ability to forecast effectively. To get the most out of your forecast, you want a system that can capture all the info about your projects in one place. That way you can look at each project and how it fits in with all your other projects. Then you can see how you are optimizing for each factor, from people to margins and beyond.

For example, who are you putting on what project, and are they the right person? Are you placing someone on a project where they will have a gap in between projects later on when someone else wouldn’t? Maybe there are two people good for a certain job on a project but one will give you better margins. If you have all the minutiae where you can see how it all works together, even down to financial, margin and utilization impacts, all the data can fit together and you get visibility at a detailed level.

Skip The Data Chase

Forecasting can be a complicated topic. We need a forecast. A good forecast enables us grow more easily, helps us build better budgets, and function better on the day to day. But it’s not just as simple as looking at the sales pipeline and forecasting which projects we think we are going to win. We have to look at all the right variables, timing, and every detail has to be measured against the rest.

To get an accurate forecast that keeps getting better and more accurate, you need a system where you can see every detail in one place and get your insights from that same place— and a cadence for sharing that data. If you have a system that only focuses on one aspect of the business, forecasting will inevitably continue to be a game of constant data chasing that can get in the way of your growth.