2019’s Top 5 Trends in Financial Planning & Analysis – Douglas Yeung

welcome to FP&A Visionaries this is the channel 
for finance professionals to get tips tricks   and information from some of the leaders in the 
finance field so today we've got Douglas young   he's a seasoned finance professional worked in a 
lot of FP&A departments at a senior level at large   companies such as Expedia Avon he now has his 
own consultancy and is based in Singapore welcome   Douglas thanks very good to be here so let's start 
off just give us a quick recap on what you've been   involved in in the finance and FPN a world actual 
map yes I have been in the FP n a side of finance   for 20-plus years worked in Fortune 500 companies 
like Nortel Networks Rockwell Automation and most   recently with Avon and Expedia here in Singapore 
I've also worked for a startup company that   specialized in Facebook games publishing so that 
was a while back but it was a good experience so   letting me have understanding of both really large 
corporations how they do FPA and also be able to   apply it to a smaller setting like a start-up 
or mid-stage growth business wonderful that's   correct so one of the topics that we're going to 
cover today is the top five trends for 2019 for   fpm age so Douglas has come up with some of the 
areas which he feels are particularly important   we're going to kick off with machine learning 
and AI I'm sure you'll agree double sisters can   be somewhat of a interesting topic when it comes 
to finance folks we tend to look at the past and   look at traditional ways of doing things so talk 
to us a little bit about what you think you will   be seeing in 2019 and Beyond yes I think that's a 
really interesting topic for finance professionals   especially folks fpn a because first of all it 
is a great time-saver for the MD&A function we   used to have to spend a lot of time trying to 
get the data understand the data and then do the   modeling and then reconcile everything but from a 
couple of years back we started to see this trend   where machine learning and artificial intelligence 
are being taught a lot more in terms of how they   can help in the forecasting side of things so the 
role of FDA professionals would probably shift a   lot from the preparation or preparing of the data 
to really understanding and interpreting the data   that comes from machine learning and AI especially 
there are a lot of exceptions we all know when   we do forecasting there's always bikes and and 
different one of impact to the data set that we   need to be very careful of so I think as a career 
in a professions we need to be able to look at   those and provide the right business insights more 
to add flavor and color to what comes out from   machine learning and AI fantastic that's great 
and the second topic on your list is the usage   of specialized financial planning tools first of 
all can you define what you mean by specialized   planning tools yes so specialized financial 
planning to probably point to more platforms and   software that's being developed to take advantage 
of the large data sets especially for we were just   talking about machine learning and AI so there 
needs to be some more sophisticated tools that can   take advantage of the wealth of data that comes 
from machine learning in AI and not just looking   at data dumps from ERP such as Oracle si P and try 
to manipulate those in Excel just because we used   to do a lot less data intensive calculations 
on Excel but nowadays given the the amount of   data that needs to go into a financial model it 
becomes a very big stress on the integrity of   different Excel models so the best way is really 
to take advantage of specialized tools that is   really good at gathering data and manipulating 
data and then feed that information into Excel   where Excel can do what it's designed to do 
providing the flexibility providing analytical   capability and easy to understand modeling for 
FPA professionals but leaved a lot more of the   data crunching and structuring of information to 
the back end of these specialized planning tools   great and I think you hit on a couple of very 
important points that obviously Excel is very   prevalent in the finance role but there's a lot of 
folks out there trying to get away from Excel you   feel Excel will ever ever die or I would go away 
in the finance world no I don't think so because   pretty much every finance professional grew up on 
learning and perfecting their Excel skills that's   the number one skills I guess for most finance 
professionals and Excel service is improving   from version to version and it's becoming more 
powerful and calculation or manipulation of data   it's just getting better and better every year but 
that still is not where a specialized two can be   in terms of the backend data structure and just 
be able to organize the data in a very effective   way so it's almost like Excel to me will continue 
definitely but it will work more and more and more   work better and better with these financial 
planning tools to become one really powerful   package for finance professionals absolutely 
and I think another key thing that you mentioned   there is to get away from a lot of finance teams 
chasing their tail doing menial tasks and really   getting down to adding value to the business and 
strategically driving the business forward that's   correct and that's where the finance professionals 
needs to better themselves and the future of FPA   which I believe will be more on interpreting and 
providing insight because we all know that machine   learning and AI will take over very soon a lot of 
the menial tasks that you just mentioned and the   way for financial professionals to stay relevant 
is really on the interpretation and be able to   read and get business insights from the from the 
data and next to me this is zero based budgeting   obviously budgeting for most organizations is 
somewhat of a chore a long process not so refined   talk to me about what do you mean by zero based 
budgeting and yes zero based budgeting I think a   lot of people know it has been around for a long 
time but it's kind of fell out of favor for a   while just because of the application is somewhat 
tedious and it's difficult for an organization to   implement it but with with all these new tools 
and and ability to collaborate throughout the   organization not just functionally but also 
geographically I think the zero base budgeting   is really on a comeback which allows the whole 
organization to work together to identify the   the right cost and expense drivers and to provide 
the business with better tools to understand and   control the expenses not to mention the strategic 
importance of being able to redirect business   operation savings to mo strategic areas of the 
organization so I think the machine learning and   with the specialized planner financial planning 
tool that we just talked about some of these old   methodology can really be updated in today's world 
and provide a very good way for organizations to   understand at a cost and businesses fantastic and 
then fourth on your list here is evolving the FPA   function traditionally again the finance teams 
and the finance department has some in somewhat   conservative I talked to me about what do you 
mean by evolving in it yes just like I mentioned   earlier the the future of FPA is really be 
able to go from very structured forecasting   budgeting cycles and maybe you know after the 
the forecasting cycle is done they start to get   involved in some ad hoc analysis for the business 
but if we can now spend more time on understanding   the business and less on just manipulating the 
data that FPN a function will have to evolve   into something else which is not just looking at 
financial data but helping the business analyze   non-financial data which really impacts the 
business performance businesses are Davonte   different functions are defining different KPIs 
for themselves so f PNA being the function that   really should be able to understand holistically 
how to improve our business profitability they can   now take their financial analysis skill set also 
applied to analyzing KPIs and then help different   functions understand how their performance impact 
the overall profitability of a company so that's   the that's how I see the FPA function evolves not 
just being not just staying in the financial side   of things but also operation and KPIs and to help 
business make more sense of what they do on the   daily basis and how that contributes to the bottom 
line excellent and I think this leads nicely into   your last friend here in terms of basically 
the fpm a team development as well and how   they can how you can foster your team within 
the finance exactly so finance professionals   especially in FPA used to come from mostly on the 
accounting side of things so we are very good at   accounting and making sure that we have the the 
right processes and we pretty much is educated   from from a business accounting standpoint but 
with evolving FPA functions we really need to   hone in on analytic skills like I said not just 
analyzing financial data but understanding the   KPIs so the analytical skill needs to be broadened 
to different areas of the business and for us to   do that then another thing to keep in mind and 
really work on is to develop the business acumen   so that when you have a conversation with the 
business you are communicating with the line   managers in their language but at the same time 
be able to translate the financial acumen into   a language that's that the business people and 
understands and lastly because of this the need   to understand data so FP&A professionals now need 
to understand how to present and communicate that   data back to the business we used to put up a 
lot of spreadsheets copy and paste it onto a   PowerPoint but in today's world that's not good 
enough for people to understand so the ability   to improve on the communication side not not 
only verbally but also how to present data in   a concise manner data visualization which again 
some of this lies financial planning to can help   and really be able to tell a story and convince 
your the audience on what you want to tell them   will be very important in developing your team's 
skill set so is really evolving from just being   accountants and understanding numbers to be more 
analytical being more proficient in business   acumen and being a better communicator great well 
that was really appreciate you giving us your five   trends and tips for 2019 over the next few weeks 
we'll be honing in in more detail this was just a   brief look at that so really appreciate your time 
today okay thank you very much Derek thank you

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