Spreadsheets have long been the go-to tool for financial planning—but in today’s dynamic operating landscape, they often create more challenges than clarity. As organizations grow and change, the complexity of financial planning increases. Relying on spreadsheets to manage evolving needs can slow progress, introduce risk, and keep finance teams in a reactive cycle.
If your team is spending more time validating numbers than driving decisions, it may be time to reexamine your planning approach.
The Real Limitations of Spreadsheet-Based FP&A
Spreadsheets might offer comfort through familiarity, but they often create friction when scaling strategic finance efforts. Common issues include:
- No single source of truth to work from: By their very nature, spreadsheets create multiple versions and disparate data points — usually stored on someone’s hard drive — making it impossible to establish a unified, reliable source of FP&A information.
- Inaccurate reports: Undetected errors in spreadsheets can lead to faulty financial reporting and poor decision-making.
- No time for strategic analysis: The FP&A department must constantly recheck data — a process that consumes valuable time and that could be better spent on higher-value strategic work.
- Poor collaboration and data-sharing: As the ultimate “disparate data source,” the spreadsheet doesn’t easily allow departments to work on the planning process collaboratively, nor does it provide context behind financial decisions.
- Static instead of dynamic planning: Spreadsheets are difficult to update with new historical data and the resulting forecast updates. For this reason, Excel-based planning is often static, prepared on an annual or semi-annual basis and soon forgotten as business conditions quickly evolve.
These challenges add up quickly, especially as financial planning becomes more interconnected with operational strategy.
Shift from Data Validation to Cross-Functional Planning
FP&A, while primarily driven by finance and accounting, should be a collaborative process involving all departments. Modern technology reduces the burden on FP&A teams by automating updates and analysis, improving accuracy and providing a single source of truth.
This change in focus enables finance to become a crucial collaborator with sales, marketing, procurement, supply chain, manufacturing, and HR. When supported by a cloud-based FP&A system — delivered in coordination with an experienced advisor like BDO Digital — finance teams are empowered to drive informed decision-making across the enterprise, foster alignment, and take on a more proactive, strategic role in business performance.
How To Evaluate and Select the Right Financial Management Application
Companies that are ready to untether their FP&A and accounting teams from the familiar-yet-limiting realm of spreadsheets can start by evaluating purpose-built, cloud-based FP&A solutions like Planful or solutions that may be offered by their ERP provider, which offer a unified platform for financial data, collaboration tools and advanced automation.
With the right platform in place, teams can move beyond manual data entry and error-prone calculations and over to a data-driven culture that prioritizes strategic analysis and informed decision-making. Here are four key points companies should keep in mind as they evaluate solutions.
Assess business needs and growth trajectory.
Have a good understanding of the business's current state and its growth trajectory. Financial software is continuously evolving, with new features and functionality released frequently. Organizations should reflect on recent changes within the business and the extent of its growth.
The selection process should not only focus on a solution that meets immediate needs but also working with the right advisory and consulting firm to choose a system that can support and scale with the business's growth for years to come.
Prioritize collaboration with context.
One of the key advantages of moving to a modern, cloud-based FP&A solution is enhanced collaboration. But simply enabling collaboration isn’t enough — it also needs to happen in context.
Too often, communication about budgets, forecasts, or assumptions takes place across disjointed tools — email, chat, spreadsheets — creating fragmented conversations and delaying decisions. When context is separated from the data, it becomes harder to track changes, understand rationale, or make confident calls.
Unified planning platforms address this by embedding communication directly into the planning process. Users can comment, assign tasks, and ask questions at the data point in question — keeping conversation tied to the numbers. This not only streamlines workflows but also strengthens transparency and decision-making by preserving a shared, centralized view of both data and context.
Explore AI and automation features.
When evaluating FP&A platforms, it’s important to understand the provider’s AI roadmap and the practical capabilities available today. Features like scenario modeling—where budgets or forecasts are generated using historical data and purpose-built algorithms—can accelerate planning cycles and reduce approval times.
Look for tools that allow flexibility in filtering data sets, timeframes, and account combinations. Emerging AI functions like anomaly detection can serve as an additional check, identifying outliers based on user-defined thresholds and flagging them for review — bringing greater confidence and control to the planning process.
Connect people, processes, and technology.
Effective FP&A platforms are designed to support how teams work—helping align technology with people and processes. Traditional tools often lead to centralized planning, in part due to concerns about data consistency. Cloud-based systems can support a more collaborative, distributed model by improving access to timely, trustworthy data and enabling broader participation in the planning process.
Drive Strategic Outcomes With Timely, Informed Decisions
Change is never easy, but today’s FP&A and accounting teams are more than ready for it. When a company decides to transform and modernize its financial decision-making processes with technology, it’s taking the first step to instilling trust and confidence in a unified, accessible financial data ecosystem. By breaking free of the limitations of legacy systems and spreadsheets, organizations are also “democratizing” their financial data and empowering finance teams to drive strategic business outcomes through timely, informed decisions.
Looking to evaluate your planning tools or process?
We can help assess where your current FP&A approach is creating friction — and explore modern solutions that make strategic finance more accessible across your organization.