Consulting project
“The financial forecast dashboard”
Manage financial dynamics and anticipate their needs

The summary of the intervention

The project intends to transform the daily financial management of the company: we move from a series of activities suffered passively, to operations resulting from a planned and optimized strategy.
A tool is created that assumes the function of financial forecasting dashboard, by which the company is able to predict the future treasury needs. The vision refers to the short and medium term, therefore to the next 12 to 24 months.
However, the forecast is not an end in itself, but acquires a dynamic value: starting from a forecast, which is not considered satisfactory, some operational decisions are supposed, bringing improvements to the scenario, which in turn is analyzed. In fact, an iterative cycle of actions and consequences is created, until the desired scenario is achieved. The latter is based on actions that must then be implemented and whose fulfillment is carefully monitored by the same instrument.
Everything is created with specific IT tools, that is, using business intelligence or treasury management tools, where existing at the company.

The symptoms of his need
The financial management of the company takes place in a continuous situation of uncertainty, with financial needs and imbalances that come suddenly and unexpectedly. Uncertainty is constant even in the absence of critical situations, but simply as not knowing what is happening or will happen in the near future.
The management of the company’s treasury is poorly planned, based on contingent circumstances, such as the possibility of making payments dependent on receipt of payments, or the temporary availability of bank credit facilities. The need to have commercial documents, to access advances on orders, invoices and bank receipts, increases the need for planning.

The course of the intervention
In carrying out the intervention various phases can be defined.
The first phase provides an understanding of the financial dynamics that will then have to be represented and managed. The active and passive financial dynamics deriving from management must be included, together with the other periodic or extraordinary financial movements, such as mortgages, investments and the dynamics of general costs.
The next phase involves the preparation of the instrument both at a technical and IT level, in collaboration with the company structure. Very important is the aspect of the interaction of the tool with the people who will have to feed it and manage it, but also, and above all, with those who will have to use it in terms of decision-making.
The third phase consists of the initial setup, where the whole is tested with the actual data in order to deliver a working and operational instrument.
The final phase consists of training people to use it, both in terms of data supply and use level for decision-making.

The human resources involved
The intervention involves the management in the part of understanding their needs and strategies.
Human resources at the operational level will be involved in the technical and operational aspects of the project. Important operational aspects will be the processes of data feeding and the IT procedures used: therefore operators of the administrative and IT area will be involved.
The management of the company will subsequently be involved in the part related to the operational use, but above all, decision of the instrument.
As in any Farnetani Consulting project we will limit the impact on the company’s ordinary activities, alternating the people involved, limiting their use, and optimizing the interaction with the consultant based on the work requirements of the individual operators.

The intervention can last from ten to fifteen days of work of a consultant, depending on the size and complexity of the company. In any case, the duration of the intervention is agreed on the basis of a specific quote. The days are scheduled according to the operational needs of the company.

The advantages achieved
The company has a tool by which to plan and manage its financial dynamics. The daily management of the treasury is therefore part of a short and medium-term strategy and every event, whether awaited or not, moves within a scenario where dynamics, risks and consequences are known.
In a perception of less uncertainty than the previous situation, the most appropriate decisions can be made. In this context the resulting decisions can be of various kinds. They may be short-term, for example to ask for a delay to a supplier because there is awareness that those financial resources will serve the following month; but they may be of medium term because, continuing with the same example, a different policy with suppliers is planned to avoid situations of financial tension in the following year.