Improve Forecasting Accuracy

Published Feb 26, 2021


Effectively Plan for Future Opportunities and Investment

All businesses exist both in the here and now and in the future. Without a means to effectively plan for future opportunities and investment, organisations can’t move forward with confidence. This is where forecasting and budgeting come into play.

An effective forecasting and business budgeting software solution allows organisations to see and do more as they look to the future. Not only will you be able to gain important insights, but you’ll also enjoy greater control of the next phases of your organisational development.

budgeting and forecasting

Key Benefits of ERP for Business Forecasting

Integrating both ends of the process

One of the key benefits of business budgeting software lies not just in its forecasting capabilities, but also in the way it integrates with other elements of business. Remember that forecasting is just that — forecasting: the action of predicting what is to come. Without proper analysis and reporting, it’s difficult to gauge how effective forecasting and budgeting really is.

With the right financial software, business owners can integrate both ends of the process. They are able to bring together the proactive practice of forecasting with the retrospective practice of reporting and outcome assessment, in order to gain deeper insights into the health of their business.

The software feeds forecasted data directly to the reporting solution so that your teams can measure predictions against the real-life outcomes. In turn, reporting data is used to refine future forecasting and budgeting, creating an integrated set of processes that achieve even more effective forecasts.

A more strategic approach

Tracking your budget and forecasting results within your financial software solution unlocks a more strategic approach to planning. Rather than simply commissioning a short- or long-term forecast based on the information at hand and then building a plan around this, businesses find themselves with far greater levels of insight and understanding at their fingertips.

Let’s say your budget forecast indicates a steady increase in revenue through product sales, but your sales figures from previous years suggest a seasonal slump across some key offerings. You will be able to draw upon your historical data, stored via the financial software solution, and temper your forecasts accordingly.

But a strategic approach means more than this. You do not have to accept such seasonal slumps as inevitable. You can instead work to counteract such shortfalls, scaling back on the production of some products at key points throughout the year and launching other product or service offerings that will achieve a net increase in profits. In this sense, forecasting is not just about foretelling what is to come, but is about providing you with the data you need to take control of this future, and mold it to suit your business.

Planning in more detail, and with greater accuracy

This strategic approach enables businesses to get far more from their forecasting and budgeting activities. With improved sources of data and an intuitive interface, software users have a greater capability when it comes to forecasting and will find that their forecasts become increasingly accurate.

Drawing upon this improved accuracy, planning teams gain the confidence they need to achieve effective innovation and a forward-thinking approach for the business. After all, forecasting and budgeting represent only part of the objective for companies — teams need to be able to turn forecasts and budgets into actionable plans that shape the short- and long-term future of the organisation.

For example, a traditional forecast might identify increased revenue for the next quarter. Upper management may sign off a portion of this revenue for the research and development of new products, allowing the business to cater to their customers’ needs. However, there may have been budget shortfalls in the past, so they may be cautious, signing off only a small amount of this forecasted revenue and leaving R&D teams constrained.

Once a forecasting solution has been implemented and has shown to be effective, wholesale trust in the software will enable management teams to distribute funds with greater accuracy. Not only this, but teams across all levels of the business will have more data to draw upon as they plan their next phases of operation.

Getting the job done more quickly

On a fundamental level, forecasting software eliminates bottlenecks and points of friction in the planning process. This, in turn, makes the entire process far more efficient, as teams do not find themselves going over old ground repeatedly, or struggling to communicate with other teams who may be working on similar projects.

As a centralised solution, financial software puts data and insight within the grasp of all users. With a cloud connection, data can be managed and updated in real time, so that each and every team is assured of working with only the latest forecasting information.

Teams need to be flexible and agile, and they cannot achieve this unless they can quickly put together and execute an effective plan. Budgeting and forecasting solutions accelerate the process without compromising on accuracy and precision.

Supporting team morale

All of the above work to improve the morale of your teams and accomplish company-wide engagement. Employees want to feel that they have the right support required to do their jobs effectively, and they want to know that what they are doing is worthwhile. Uncertainty and a lack of direction erode these positive feelings, leaving employees disengaged and low on morale.

Gaining a handle on your future with business budgeting software and forecasting solutions helps you maintain the positive working environment you need for your business to succeed. Employees can witness first-hand how their efforts are making a real difference for the company and can gain the feelings of security and confidence that come from a well-planned long-term strategy. What’s more, they’ll feel valued by upper management, knowing that management teams are willing to invest in the solutions they need to work effectively.

Discover More About Financial Planning Software and Take Control of Your Business’ Future

The future does not need to be uncertain or unclear. With the right software at your side, you will gain control of this future, and secure a positive strategy for the short- and long-term.

At Precise, we offer a selection of budgeting, forecasting and data analytic applications that are either native or tightly integrated to Epicor ERP. Speak to one of our ERP specialists to discuss what these solutions can do for the financial health of your business today.