Multi-Dimensional Planning for Everyone

A discussion about business dimensions can be quite abstract. That often makes it difficult to understand the challenges dynamic business dimensions introduce to performance analysis, modeling, and planning. With that in mind, let’s take a look at how dimensions, specifically multi-dimensional planning, impact the life of Lucy, a financial analyst at a global company.

Lucy identified an issue in the pricing structure of one of her employer’s products. It started when she pointed out that the Asia-Pacific region didn’t pull its own weight at her company. Sales in the region were growing, but not at the profit levels seen everywhere else. Executives were considering pulling out of APAC but wanted her to first get to the bottom of why profits were lower in this region before they pulled the trigger.

So Lucy rolled up her sleeves.

• She compared revenue and profit margins, by region and by product, over time → She realized that it was one specific product that was dragging the region’s profit margins down.
• She added price and cost by product to the analysis → She didn’t see much difference in these two metrics versus the other regions.
• She looked at the quantity by product for each region → there it was: the way that their solution was deployed in APAC resulted in a different product mix that bolstered the volume of lower-margin products.

Lucy worked with the revenue operations and product management teams, and they modeled what the next 2 years of business would look like with a different pricing structure for APAC that was better suited for that market. After two weeks of intensive spreadsheet modeling and a presentation to the executive team, the decision was made to continue to do business in the Asia-Pacific region with an altered pricing structure.

Then Lucy was in trouble.

The executive team was so impressed with the precision and insightfulness of Lucy’s model that they asked her to continue to update it quarterly so the company could safeguard its profitability. But Lucy knew that maintaining spreadsheets as they added new markets, products, costs, prices, and time periods would be very time-consuming and error-prone.

Analysts like Lucy have a huge problem: they are trapped in their spreadsheets. Spreadsheets are well suited for our human eyes, which see things in two dimensions. Unfortunately, businesses are defined by multiple dimensions. Lucy’s model required 8 dimensions:

1. Region
2. Product
3. Revenue
4. Margin
5. Time
6. Price
7. Cost
8. Volume

Many analysts who try to match the multiple dimensions of their business with the convenience of spreadsheets are quickly struggling to maintain models and get detailed and accurate insights about their business. This is the result of trying to do multi-dimensional planning with a two-dimensional tool.

Although multi-dimensional planning tools have been around for a while,

• They are expensive.
• They consume significant resources to implement, maintain, and update.
• They are not easy to iterate on to adapt to changes in the business, expand the model, or introduce new metrics.
• Modeling is reserved for a few experts and not accessible to business leaders and analysts, and
• Collaboration across multiple users is not easy.

The result is that multi-dimensional planning tools have not been able to liberate the analyst from the two-dimensional spreadsheet.

Until now.

Finicast provides a modern SaaS enterprise planning platform to model, plan, forecast, and track performance across organizations of all sizes. Using a proprietary data engine combined with an intuitive user experience, Finicast provides a collaborative planning platform for companies who have reached the limits of traditional spreadsheet solutions due to their business scale, operational complexity, and market dynamics.

Once Lucy procured Finicast, she gained the ability to easily update her multi-dimensional model collaboratively every quarter. With the power of Finicast’s planning platform, Lucy's company experienced tremendous success. Her insightful analyses and accurate forecasts allowed the executive team to make informed decisions, leading to improved profitability in the Asia-Pacific region and beyond. Recognizing her exceptional contributions, Lucy's dedication and expertise were rewarded with a well-deserved promotion to Senior Vice President. Her journey from a financial analyst to a key leader within the organization is a testament to the transformative impact of adopting innovative planning solutions like Finicast.