You were hoping to have a clean story… why the numbers are red, what you are doing about it.

The reality is that you’re still asking yourself: are the numbers even right?!

Been there? I know I have.

Nobody up the chain got it wrong. They’re all working off the same fuzzy definition of the same contested number. Five people, five spreadsheets, too many “right” answers. 

So, is the fix another spreadsheet… you know, one to rule them all? Of course not.

How about an AI Analyst? One that gives everyone the same shared definition, one source of truth everyone draws from. Summation’s Knowledge layer is what makes that possible: a single, verified version of what each number actually means, then checks its own work against it every time, traced all the way back to the source.

At global sports platform Fanatics, more than half of the AI-generated reports had at least one error on the first pass. The Summation verification pipeline caught every one, before anyone walked them into the room.

PS - See Summation’s AI Analyst run on your report

Years ago, I inherited a corporate FP&A team as CFO.

I got them together for an intro meeting. Nothing heavy. I just wanted to chew the fat, understand the team, and figure out how they spent their time.

So I asked a simple question: “What do you guys do?”

“We support the business with FP&A work.”

“OK. But what specifically?”

“Well, we support central procurement with FP&A. And if the business units need FP&A support, we help with that too.”

Right… You can probably see where this is going.

We went round that loop a few times. FP&A work meant supporting FP&A activities. FP&A support meant helping the business with FP&A. And business support meant, well, FP&A support.

It was a kind of finance circle-jerk. The snake eating its own budget pack.

Eventually I got underneath it. And to be fair, some of the work was useful. A little of it was very useful. But too much of it was either not useful at all, or just useful by accident.

The team was capable. The problem was not talent. The problem was that the work had not been broken down clearly enough.

So nobody was quite clear on what mattered, what didn’t, who the work was for, what decision it supported, or whether there was a better way of using their time.

My eyes lit up… because I could see a team of capable people who could be redeployed for much greater “FP&A” impact.

But to do that, I had to get underneath the lazy labels.

“FP&A” wasn’t going to be specific enough.

Last week, we covered the “more” paradox in FP&A. More forecasts. More analysis. More dashboards. More measurement. More business partnering. More visibility. More everything. And yet, often, more FP&A isn’t what the business needs.

It needs better FP&A.

Which leaves the obvious question: What does better look like?

This week, we start answering that by breaking down the seven FP&A activity types from last week:

It’s important, because FP&A is not one job. It is a stack of different activities, each creating different work inside finance and inside the business. Different outputs. Different decisions. Different failure modes.

So let’s start with my favorite of the seven. Yes, I have a favorite…

Financial Planning is where strategy meets scarcity. It is the process of forcing the business to choose where to allocate its scarcest resources, and setting targets accordingly. Those resources are typically capital, people, capacity, focus and time

A good financial planning cycle will control for all constraining resources.

So, what activities typically sit inside Financial Planning?

Note: These maps are not checklists. They are a way to decide which FP&A capabilities your business actually needs, what work they create, and where they can go wrong. You won’t need everything.

Financial planning is my favorite part of FP&A for a reason… The long-range plan and budget create the connective tissue from strategy into operating assumptions. They make strategy real.

How much planning you need depends on how severe your constraints are:

Normally… all of these are tight.

BUT financial planning creates a metric shit ton of meetings and busy work, so you have to be careful about getting the scope right. Good conversations about trade-offs are valuable. Performative target negotiations are not.

The key design choice is usually the planning dimensions: time period, business unit, cost center, product, geography, driver, KPI, etc.

The design of those dimensions determines how many people are involved, at what level, and for how long. So if in doubt, err on less, not more. Most finance teams do the opposite.

You know you’ve got this right when you can allocate planning ownership to leaders at a level they understand and can actually influence.

For more on how to run these processes well, see my previous pieces on long-range planning  and budgeting.

Forecasting is the process of looking ahead, engaging the business, and asking what has changed. And what, if anything, should we do about it?

Budgets and forecasts often get thrown around like interchangeable terms. They are not: Where planning is mostly about choices, forecasting is mostly about visibility.

That doesn’t mean forecasting is passive. Done well, it still forces trade-offs. But the trade-offs are different. They are usually in-year decisions: pull spend forward or back, hire or freeze, accelerate a pricing move, protect cash, shift capacity, reset a target, intervene in a weak business unit

But the real question is, do you actually need more forecasting to make those decisions?

Any time the business spends speculating about the future is time not spent on execution. That was the trap in my opening story last week. In that case, forecasting became a place to explain and reset performance, not improve it.

For most businesses, a sensible starting point is:

Start there. Then add forecast frequency only if you really need it… especially if you are engaging the business to update any assumptions - you can read more on my issue with that here.

If you have complex cash dynamics, thin liquidity, external guidance, major capacity constraints, a fast-moving market, or lots of moving operating assumptions, you may need more formal re-forecasting.

But many FP&A teams default to whatever feels tidy in the cycle, or sounds good on a Powerpoint slide. And in doing so, create a kind of culture where leaders don’t know how to make operational decisions without a forecast in front of them.

Most operational decisions are not high science, and don’t need to be treated that way. They should be taken by leaders with a great feel for the business working inside guardrails set by the planning cycle.

Performance reporting is where finance establishes what happened. Not why (that comes next.)

The job of reporting is to create a shared version of reality. An undeniable record of the facts. 

Everything else inside the FP&A cycle has some degree of subjectivity, this one does not. It focuses on how the business performed against a reference or comparator point (i.e. budget, last year, etc).

Performance reporting doesn’t create much direct work outside finance. The heavy lifting should happen inside finance. But reporting does create a lot of indirect work in the business.

The power dynamics and accountability structure in your company act like invisible threads. When reporting highlights something, those threads pull. Meetings happen. Questions get asked. People defend, explain, escalate, investigate, or act.

So make sure your reporting pulls the right threads… Each management forum can only absorb a few talking points. Three is usually the maximum. One is better.

This is why reporting needs to be thoughtfully designed; picking the right dimensions, and presentation for the audience. Business unit. Geography. Product. Customer. Channel. Factory. Cost center. KPI. Time period.

Be picky.

Most finance teams are not. They add a page just because someone asked once. There is always less friction to add reporting than to remove it, so you need a deliberate force working the other way.

One useful tool is the quarterly moratorium. Each quarter, select a handful of reports to pause. Keep producing them for two or three cycles, but stop distributing them. If nobody complains, kill the report and all the work that sits behind it.

Again… start with less, and have a high bar for adding more. I did a whole series on performance reporting here.

Performance analysis is the more tactical cousin of performance reporting. It’s the ‘why’ to the ‘what’. And more importantly the ‘what now’...

This is where FP&A moves from holding up the mirror to helping the business understand what it is looking at, and what to do. Frankly, it’s where FP&A really earns it’s money

Good analysis should isolate the driver, size the impact, and point toward action. It should drill from the boardroom number down to the root cause. OK, so revenue missed... fine, but why? Volume, price, mix, churn, conversion, timing, channel, customer, product, region?

The job is to find the economic cause, then connect it to the operating action. I wrote a full piece  recently about how to do this.

A reminder on these tables: they are not saying every business needs every activity. They are a map of the possible work.

Performance analysis is probably the FP&A activity with the most direct link to valuable action in the business. The more granular and tactical the insight, the more likely it is to change something.

It tends to be obvious when performance analysis is failing. You are producing endless cuts, bridges, decks, and drilldowns, but no one is taking the right action.

When that happens, ask two questions:

Sometimes finance is admiring the problem from too far away. The analysis is too abstract, too late, too high level, or too disconnected from the operating levers.

But sometimes the analysis is fine. The business just does not have the accountability, capability, or appetite to act on it.

I wrote more on performance analysis here. 

Business finance is where FP&A gets closest to the action.

This is the work most people are trying to describe when they say “finance business partnering.” It is finance sitting close enough to commercial and operating decisions to improve them.

Note: I have a problem with the term ‘business partnering’, but I’m going to save that rant for next week.

And we aren’t talking about the big strategic decisions here. These are the everyday decisions that nudge revenue up, margins up and costs down.

Pricing. Deals. Customer profitability. Hiring. Spend. Recovery plans. Investment cases. Capacity trade-offs. Real FP&A work.

The key word here is tension.

It should feel tense between finance and the business. Tense, but productive. I’ve called this Business Finance, but you could just as easily call it execution support.

Great execution is difficult, and is to be respected. FP&A can be a great help, a hindrance, or of no consequence a tall, depending on how it is set up.

FP&A should light fires in the right places. Create urgency in performance where it's needed.

And by giving managers the right tools, guardrails, and accountability to make better decisions automatically. Done well, finance doesn’t need to approve every move, but the business makes decisions that finance would approve of regardless.

Strategic finance is the cerebral end of FP&A.

If business finance improves everyday execution decisions, strategic finance improves the big, infrequent, enterprise-level decisions where the stakes are higher and the answer is usually less obvious.

Capital allocation. M&A. Major investment cases. Transformation. Portfolio choices. Strategic scenarios. Valuation.

These decisions need to be centralized and taken by the most senior people in the business. They are too large, too cross-functional, and too consequential to be pushed down into the normal management rhythm.

There is some overlap with financial planning, but they aren’t identical. Financial planning creates the overall shape of the plan. Strategic finance supports large, discrete decisions inside (and sometimes outside) of that shape.

The measure of strategic finance is whether it improves the quality of the big bets.

That means two things:

The temptation here is to be a slave to the discounted cashflow. It’s not always (and frequently isn’t) the right analysis tool. BUT… It is a fantastic mental model for Strategic Finance decisions.

That means thinking in cashflow terms: direction, magnitude, timing, certainty, and the probability distribution around the outcome. But for it to be of any value at all… strategic finance has to arrive before the decision has hardened.

If the CEO already wants the deal, the transformation already has a project name, the market entry already has a sponsor, or the investment case is already being written for approval, finance is late.

At that point, it is hard to improve the decision. You are usually just reasoning backwards from a corner. And no, that is not strategic finance (even if you put that label on it.)

This is the work nobody sees.

It is the unsexy end of FP&A (no one applauds the plumber.) It feels closer to accounting than strategy. Data definitions. GL mappings. Model architecture. Workflow. Controls. Automation.

I think of it like sharpening the saw. If you have five hours to cut down a tree, how much time do you spend sharpening?

Or, better yet, building the machine that cuts the next hundred trees.

This work has to be managed carefully. Many FP&A teams go down this rabbit hole and never return.

I’ve seen analysts and FP&A managers disappear into a “quick re-mapping exercise” that was supposed to make things easier, only for it to become a mini-transformation project by stealth. The size of the challenge gets underestimated. The work expands. And suddenly the team is spending weeks fixing the machine instead of using it.

FP&A infrastructure is not really the work… It is the work behind the work. It may sit with FP&A because they understand the models, data, processes, and outputs better than anyone else. But it is closer to accounting, systems, and process work than true FP&A.

So be disciplined:

And if the work is too large to deliver in short bursts on a fast cycle, treat it as a real transformation project and resource it that way.

Think of these tables as a map of the possible FP&A activity universe… not a checklist.

They are a set of capabilities you could build. But you should only build the capabilities your business actually needs, and can actually handle.

Think of this is like muscle groups; like the way the biceps (pull) work together with the triceps (push). The pull comes from the business. The push comes from FP&A.

If you have a basic sales function with limited commercial finance capability, there is no point giving them a full sales business finance stack. Deal desks, margin guardrails, customer profitability, pricing analytics, territory economics, pipeline conversion models.

That is too much push and not enough pull. You will waste time, confuse people, and create finance work that never becomes business action.

The reverse is just as bad…. If you have an operations team geared up to make cost center-level spend decisions at a GL account level every week, your budget and reporting had better support that level of detail.

Their pull is strong. Your push needs to match it.

They do not need to be of exactly equal strength, but they need to be close enough.

On to this week’s homework:

There is no right size for FP&A.

It needs to fit the maturity of your business, the objectives of your business, and the capability of your finance team.

That starts with understanding the work your FP&A team is actually doing. Why they are doing it. What output it creates. What work it creates for the business. And whether the business can turn that work into better decisions, action, and accountability.

Next week, we take that one step further: how to map this work into an actual FP&A team.

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Disclaimer: I am not your accountant, tax advisor, lawyer, CFO, director, or friend. Well, maybe I’m your friend, but I am not any of those other things. Everything I publish represents my opinions only, not advice. Running the finances for a company is serious business, and you should take the proper advice you need.