Three Best Practices in Planning and
Forecasting -- and How to Apply Them
Nicole Diceman
Product Marketing Manager
Prophix Software
Connie Noonan
Finance Manager
Community Physician Network
Wednesday, September 4, 2013
The office of finance faces new
challenges
Up next: Three best practices
Companies today can access more
data.
They need to forecast more often.
Collaboration is a fundamental
requirement.
Three best practices…
Keys for Success
1. Align organizational focus on Planning – Increase bandwidth
– Focus on efficiencies & inefficiencies: Process, People, Infrastructure
2. Broaden ownership and accountability – Provide value and empowerment
3. Take small steps – Don`t try to Solve world hunger over night
Align organization focus
Process
• Finance centralized
• Limited ownership & accountability
• Limited collaboration
•Data aggregation timing
•Manual & error prone
•Unstructured
People
•Bandwidth issues
•Struggling to just get numbers together
•Analysis is an afterthought
•Employee Skill
•Business & IT exposure
Infrastructure
•Under developed infrastructure
•Excel based
• Integrity issues
•Security issues
•Control issues
•Unable to support business needs
Broaden ownership
It`s that time of year again…
Budget Season
• My experience
– Favourite time of year
– Time devoted to strategy
POLL #1
How many different individuals are
currently involved with the planning
process at your organization?
1-5
6-10
11-20
More than 20
Broaden ownership
Corp-CEO
•Grow company by 25%
GTM-COO
•Achieve revenue of $50M
Finance-Team
•Streamlined, collaborative, timely planning
Broaden ownership
• Observation on others
– Frustration
– Wasted time
• Need to turn this around
– Facilitate collaboration
– Involve line managers
Start small, and take smalls steps
• Focus on pain: budgeting, forecasting, reporting process? – Financial translation of the Plan
• Need to focus efforts on the Plan – Developing the Plan
– Monitoring execution on Plan
– Revisit plan as assumptions change
• Failure is related to misalignment of activities and focus
• Recognition of this is driving the need to improve
When an organization cannot…
x Keep it current, keep it relevant
x Track performance
x Make it easy
Process and supporting solutions
POLL #2
What is your company currently using for
budgeting, planning and reporting?
MS Excel
MS Access
GL
Other
Reality of Traditional Tools
Lacks detail
Fragmented
Inflexible
Local Scope
No
Measurement
Detailed operational forecasts are nonexistent
Functionality split across multiple interfaces, technologies
Could not easily adapt to changing business
Narrowly deployed without a complete view
Difficult to track against industry benchmarks and actuals
Realties of Today
Budgeting
Process
(Bottoms Up)
Top
Down
Revisions
Process
Prep Final
Approval
Existing Challenges
Budgeting
Process
(Bottoms Up)
Top
Down
Revisions
Process
Prep Final
Approval
Out of Date
Keys for Success
1. Align organizational focus to Planning
2. Broaden ownership & accountability
3. Take small steps
Thank You!
Budget Cycle Evolution
Connie Noonan Finance Manager – Forecast & Reporting
Wednesday, September 4th, 2013
17
Community Physician Network • One of the area’s largest multi-specialty medical groups with
more than 100 locations across central Indiana. • Includes more than 500 primary and specialty care
providers. • Physician developed and led group practice that functions as
a partner of the Community Health Network.
Community Health Network • Founded in 1956 with the opening of our east side hospital
which was funded entirely by local businesses and private citizens.
• Ranked among the nation’s most integrated healthcare networks.
• Includes specialty and acute care hospitals, health pavilions, surgery centers, home care, MedChecks, behavioral health and employer health services.
Manage Quarterly Forecast/Annual Budget process
Global Administrator for CPN’s Corporate
Performance Management (CPM) Solution
My Role
18
Responsible for all Financial and KPI reporting to Operations Management, Physicians, Executive Leadership, outside consultants,… Assist Finance and Operations teams with data review
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2008 Budget Cycle
2 full time financial analysts responsible for pulling together the annual budget using Excel spreadsheets:
• 70 site managers across multiple locations
• 12 Regional Practice Directors and Executive Leaders
• 190 FTE primary care physicians and nurse practitioners
• 550 FTE staff employees
• Budget at practice level, then allocate down to providers
• Separate account roll ups for network vs. operational reporting
• Summary consolidation for Board and Finance Committee
• Final load to general ledger for monthly reporting
• Update / Format massive spreadsheets
• Add new practices, providers, accounts
• Edit links and formulas
• Add base assumptions
• Export GL Data and copy into spreadsheets
• Divide and distribute templates to sites
• Collect data from sites and consolidate
2008 Budget Process
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• Report consolidated budget
• Export Excel budget data into Access
• Generate journal entry to post to GL
• Use reporting software to view budget
• Executive leadership review
• Change in assumptions made to spreadsheets
• Consolidated reports re-generated
2008 Budget Process (continued)
21
22
Poll #3
What are you looking to improve in terms of planning, budgeting and forecasting at your company? Fee free to select any choices that apply.
• Having a more collaborative planning process
• Having a unified solution
• Having one secure version of the truth
• Having direct integration to source GL data
23
Why Change?
• Difficult for sites to follow • Security • Distribution • Accountability • Scenario planning • Duplicated efforts
• Wasted time • Consolidation • Manual process • Errors • Reporting and
analysis
Not adaptable to growth and changes
24
2010 – 2011 Milestones
25
2012 – 2014 Milestones
26
2008 2013
BUDGET BUDGET
Total Operating Revenue $66.2M $174.6M
Net Income before Provider Comp & Benefits $10.8M $48.9M
Physician FTEs 167 337
Mid-Level Provider FTEs 21 82
Staff FTEs 556 1330
wRVUs 718,419 2,312,476
Visits 579,245 896,309
Number of locations 82 129
We are Growing
Use CPM Software to….
• Build assumptions and pre-populate budget
• Automatically sent templates to sites
• Track submissions, deadlines, and approvals from management
• Automatically consolidate data
• Perform on-the-fly analysis
• Compare multiple scenarios
• Report results in multiple ways
• Region
• Comp vs. Guar Physicians
• Specialty
How We Budget Now
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• Single source of truth
• Quickly change assumptions
• Data review
• Reduce errors
• Easily consolidate data
• Uniform reports with little effort
• Automatically distribute and collect
• Compare multiple scenarios
SAVES TIME
Greatest Benefits of CPM Software
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It used to take us 5 months to prepare and finalize the budget • Time spent mostly on pulling the data together, formatting, adjusting
formulas, consolidating then reworking the data
• Very little time to review data
Saving Time with CPM Software
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Now it takes us 2 months • Minimal time spent on populating, formatting, and consolidating
• Most of our time is now spent on review
• Workflow process for entire budget cycle
• Automate balance sheet assumptions
• Automate provider compensation calculations
• Build reports for routine leadership inquiries:
• Driving factors for changes to budget
• Net impact of new acquisitions
• Net impact of new providers
• Admin staff changes by employee
Future Plans for Improvement
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Q&A
Nicole Diceman
Product Marketing Manager
Prophix Software
Connie Noonan
Finance Manager
Community Physician Network
