FP&A Tomorrow Paul Barnhurst

Welcome to FP&A Tomorrow, where we discuss financial planning and analysis, examining its current state and future prospects, with your host Paul Barnhurst.

In today’s episode, Paul engages in an insightful roundtable discussion with Nathan Kaemingk & Karan Sood on LinkedIn. In the episode, we discuss the nuances of strategic pricing and its immense impact on business profitability.

Karan, a seasoned pricing professional, shares his extensive experience across various industries, emphasizing the importance of cross-functional alignment and value-based pricing.

Nathan, with a unique background in mechanical engineering and forecasting, highlights the critical role of understanding costs and leveraging pricing strategies to combat inflation and optimize profits.

Key takeaways from this week's episode include:
Here is a concise summary of the key points from the discussion:

Effective pricing requires collaboration between finance, FP&A, and pricing teams. Transparent communication and alignment on goals are essential to ensure cohesive strategies that drive profitability.

Value-based pricing is the gold standard, especially in service industries. By quantifying and communicating the value provided to customers, businesses can justify higher prices and enhance profitability.

Inflation significantly affects pricing strategies. Companies must adjust prices to keep up with rising costs and maintain profit margins, making strategic pricing more critical than ever.

Relying solely on cost-plus pricing can lead to missed opportunities. Understanding customer value and competitive positioning allows for more strategic price setting, rather than simply adding a margin to costs.

Constructively using promotions and discounts can drive volume without eroding profit margins. Measuring and optimizing these strategies ensures they contribute positively to overall profitability.

Rebates can be effective for maintaining uniform pricing across different channels and incentivizing performance. However, companies must measure and adjust rebate programs regularly to ensure they are beneficial.

Accurate forecasting and aligning sales with operational capacity are crucial. Effective sales inventory and operations planning [SIOP] can significantly increase net profit margins by optimizing resource utilization and pricing strategies.

Quotes:
Here are a few relevant quotes from the episode 
"The art of pricing goes beyond just number crunching, it goes into cross-functional alignment on what the goals are."

“The 1% increase in price leads to an 11% increase in profit margins coming out of McKinsey years ago. It still holds true.”

“It's amazing how easy it is to increase profits by being good at pricing.”

“Pricing is going to become one of the most important things that we get good at over the next half-decade.”

Exciting Announcement
I am excited to share my two new digital FP&A Courses with you FP&A Business Partnering, and Modern Excel. They launched yesterday and I am excited to offer a 20% discount to my listeners. Use code PODCAST.

Link to courses: 
FP&A Business Partnering (thinkific.com)
Modern Microsoft Excel (thinkific.com)

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Welcome to FP&A Tomorrow, where we discuss financial planning and analysis, examining its current state and future prospects, with your host Paul Barnhurst.
In today’s episode, Paul engages in an insightful interaction with Philip Watson, for a discussion on what it takes to excel in financial planning and analysis (FP&A).
Philip, the CFO of Paddle, brings a wealth of knowledge, having led FP&A at ZoomInfo through its rapid growth and IPO. He is known for his commitment to developing talent, Philip's leadership has shaped the careers of many finance professionals. Currently leading Paddle’s financial strategy, Philip is transforming how fintech companies handle complex financial operations.
Key takeaways from this week's episode include:
Here is a concise summary of the key points from the discussion:
Great FP&A extends beyond finance skills, encompassing the ability to communicate with stakeholders, understand the business, and manage relationships. It's about being operationally involved, translating complex financial stories, and driving business insights.
While finance skills are fundamental, the future of FP&A will require advanced technical abilities. Soft skills, like communication and stakeholder management, remain crucial, but familiarity with data science and coding will become increasingly important.

Emphasizing the importance of small, incremental improvements, aiming for 1% better every day. This approach, combined with rigorous measurement and process optimization, helps drive long-term business success and operational excellence.

Sales compensation is a significant driver of behavior and revenue. Aligning incentives with business goals is essential to ensure that sales efforts contribute positively to the company’s financial health and strategic objectives.

Implementing a detailed, three-statement forecast on a rolling 18-month basis provides valuable insights into future business performance. This process requires the right tools, experienced personnel, and a robust infrastructure to ensure accuracy and reliability.

FP&A serves as an excellent training ground for becoming a CFO. Exposure to various business aspects, forecasting, and financial strategy prepares professionals for leadership roles, making FP&A a vital stepping stone in a finance career.

The title sponsor for this week’s episode of FP&A Tomorrow is Plan Buddies. Plan Buddies, where professionals meet excellence. Ready to elevate your career? Visit plan-buddies.com and become a member today. Here's a special treat. Use the promo code TheFPandAGuy, that is TheFPandAGuy for an exclusive 25% discount on your first-year membership.

Quotes:
Here are a few relevant quotes from the episode 

"Some of the nice stuff, some of the machine learning stuff will probably take care of some of the grunt kind of modeling grunt, grinding through Excel that we have now, and it will automate some of that. It won't replace. I don't think it will replace people. It will change their job."

“I think FP&A is probably the best launchpad for being a CFO. You get exposure to all the business leaders. You get exposure to all other aspects. It forces you to think ahead and not behind.”

“Your job is to go translate numbers, to go communicate to the business, and be out with the business, in the meetings, in the room. It's important to be in the room.”

“Sales comp is a massive driver. I mean, compensation is a massive driver of behavior.”

Follow Philip:

LinkedIn - a...

Welcome to FP&A Tomorrow, where we discuss financial planning and analysis, examining its current state and future prospects, with your host Paul Barnhurst.
In today’s episode, Paul engages in an insightful interaction with Tyler Cypher, for a discussion on how generative AI is reshaping FP&A, the importance of business partnering, and optimizing cloud spend.
Tyler, the founder and CEO of OpsCipher, shares his journey from Disney finance intern to leading FP&A at top cybersecurity firms. He is an expert in leveraging generative AI for strategic decision-making. Also a passionate advocate for effective business partnering and optimizing cloud spending.
Key takeaways from this week's episode include:
Here is a concise summary of the key points from the discussion:
Generative AI simplifies data processing, enabling FP&A teams to focus more on strategic analysis and decision-making, ultimately enhancing their value to the organization.Success in FP&A hinges on understanding business challenges, effective communication, and building trust with stakeholders. Being curious and proactive is key to growth.Effective cloud spend management requires visibility, collaboration across teams, and financial stewardship from the early stages of product development to avoid unnecessary costs.Financial operations play a critical role in managing cloud costs. Establishing a dedicated FinOps team or center of excellence can provide significant benefits.How skills from varied roles like investment banking and consulting can enhance FP&A effectiveness. Exposure to various business aspects through FP&A provides a strong foundation for leadership roles.
The discussion highlights the necessity of mastering copywriting to communicate effectively and set clear expectations with stakeholders. For FP&A professionals this skill helps in selling ideas and managing business relationships successfully.


The title sponsor for this week’s episode of FP&A Tomorrow is Plan Buddies. Plan Buddies, where professionals meet excellence. Ready to elevate your career? Visit plan-buddies.com and become a member today. Here's a special treat. Use the promo code the FP&A Guy, that is TheFPandAGuy for an exclusive 25% discount on your first-year membership.

Quotes:

Here are a few relevant quotes from the episode

"The people who are the most successful have a genuine curiosity about the business. It's very hard to go into those teams and try to be that analytical value-add extension if you can't understand their challenges."

“If you think about software business, generally, the two biggest expenses are people and then the cost of running the software.”

“FinOps as an organizational structure. So from the first part, I think, it's inherent in the word financial operations. It's a financial stewardship-driven culture in the first place.”

Follow Tyler:

LinkedIn - https://www.linkedin.com/in/tylercyphers
Website - http://opscipher.com

Follow Paul:

Website - https://www.thefpandaguy.com
LinkedIn - https://www.linkedin.com/in/thefpandaguy

For CPE credit please go to earmarkcpe.com, listen to the episode, download the app, and answer a few questions. For AFP FPAC certification answer the questions and contact Paul Barnhurst for further details.

In today's episode:

(1:20) - Introduction
(01:50) - Guest Introduction
(02:26) - Defining Great FP&A
(05:01) - Impact of Generative AI on FP&A
(06:59) - Future of FP&A with AI
(13:25) - Becoming A Strategic Business Partner
(17:40) - Cash Flow for Coders Newsletter
(21:30) - Optimizing Cloud...

Welcome to FP&A Tomorrow, where we discuss financial planning and analysis, examining its current state and future prospects, with your host Paul Barnhurst. 
The title sponsor for this week’s episode of FP&A Tomorrow is the Third Generation FP&A Tools Showcase. Join the Showcase and see the latest technology in FP&A planning software. Register for free today: https://www.accelevents.com/e/fpatoolsshowcase

In today’s episode, Paul engages in a thought-provoking conversation with the awesome Jim Cook and Winnie Aoieong, for a fascinating discussion on the importance of decision-making systems, the value of trust in business partnerships, and the role of generative AI in modern FP&A.

Jim Cook, former CFO of Mozilla with a rich history at Netflix and Intuit, shares his valuable insights on effective decision-making systems and the power of community building.

Winnie Aoieong, VP of Business Finance at PowerSchool, discusses her experience in scaling financial operations and the critical balance of technical skills and business communication.

Key takeaways from this week's episode include: :

Here is a concise summary of the key points from the discussion:

Great FP&A goes beyond data analysis to create effective decision-making systems, allowing businesses to make strategic decisions based on comprehensive insights.


Building strong, trust-based relationships with business partners is essential for effective collaboration and achieving organizational goals.


Discussion on harnessing the power of community and crowdsourcing can significantly enhance problem-solving and innovation within an organization.


How to balance technical skills with effective communication is crucial for translating complex financial data into actionable business strategies.


Adaptability to embrace a mindset of continuous improvement and learning from failures. Progress over perfection drives long-term success.


Utilization of generative AI for tasks like meeting summaries and action item tracking can enhance efficiency and focus on high-value activities.


Leadership development within the team and creating a safe environment for challenging assumptions encourages innovation and growth.

Quotes:

Here are a few relevant quotes from the episode about the importance of decision-making systems, building trust in business partnerships, and the role of generative AI in enhancing FP&A efficiency:


"Great FP&A is the balance of technical skills and translating that into actionable plans to communicate with the business."


"Ultimately what they're trying to do is partner with their department business unit and create excellent decision-making systems because that's what our data is eventually doing."


"A relationship builds on trust. So trust comes from your capacity, your capabilities, but also your way of wanting to build that alliance with whoever you work with."


"Mozilla taught me about how powerful communities are. Communities always win."


"Perfection is a prison. It's about always progressing and improving because there is always room to get better."


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In today’s episode, Paul engages in an insightful interaction with Julian Castelli, for a discussion about the transformative role of FP&A and evolution from basic finance to a strategic role influencing business decisions and investor relations, highlighting his leadership experiences and the importance of core values.
Julian is currently serving as a board director and board chair. With experience as a board director and operating partner many times over, Julian assists SaaS and Marketplace technology companies in areas like strategy, team development, growth execution, fundraising, executive coaching, and board governance. He began his career in investment banking at Goldman Sachs and later worked as a consultant at McKinsey & Company. 


Key takeaways from this week's episode include: :

Here is a concise summary of the key points from the discussion:


The competitive dynamics and funding needs of marketplace and SaaS (Software as a Service) businesses. SaaS businesses can be more capital efficient and have multiple successful players compared to winner-take-most marketplaces.


The transformative power of adhering to and actively promoting company values, even in crisis, which can galvanize a team and reinforce commitment to the organization's mission and customer service.


Growth-stage companies need sophisticated FP&A to meet investor expectations and aid decision-making. FP&A should influence a company's financial and strategic decisions, not just report on them.


Promoting company values strengthens internal culture and aligns team actions with the organization's mission. Companies must evolve from managing daily finances to integrating broad strategic financial planning.


How skills from varied roles like investment banking and consulting can enhance FP&A effectiveness. Exposure to various business aspects through FP&A provides a strong foundation for leadership roles.


The discussion highlights the necessity of presenting financials in a way that aligns with investor expectations, which is often different from traditional accounting reports. 


The title sponsor for this week’s episode of FP&A Tomorrow is the Plan Buddies. Join Plan Buddies. Plan Buddies, where professionals meet excellence. This isn't just any community. It is a community run by and for planning professionals. At Plan Buddies we’re all about fostering connections, sharing knowledge, and providing mentorship among FP&A experts. Ready to elevate your career? Visit plan-buddies.com and become a member today. Here's a special treat. Use the promo code the FP&A Guy, that is TheFPandAGuy for an exclusive 25% discount on your first-year membership.

Quotes:

Here are a few relevant quotes from the episode about FP&A's transition from basic finance to a strategic role, the critical importance of financial planning and analysis, and the influence of leadership and core values in navigating business challenges.


"So without FP&A, you can't see what's ahead of you."


"But if you present a P&L like that [Natural Account Line] to an investor, you might end the meeting right there."


"Unfortunately, I'm kind of shocked that the ERPs out there make it so difficult to actually produce financial reporting the way the investors want."


"FP&A is not just a luxury; it's essential as you scale and begin dealing with institutional...

Welcome to FP&A Tomorrow, where we discuss financial planning and analysis, examining its current state and future prospects, with your host Paul Barnhurst.
The title sponsor for this week’s episode of FP&A Tomorrow is the Third Generation FP&A Tools Showcase. Join the Showcase and see the latest technology in FP&A planning software. Register for free today at https://www.accelevents.com/e/fpatoolsshowcase
In today’s episode, Paul Barnhurst engages Trevor Anthony, for a fascinating discussion on the evolution of financial planning and analysis (FP&A) and how artificial intelligence (AI) is shaping its future.

Trevor, a seasoned Chief of Staff at FranConnect, excels in transforming FP&A roles into powerful business partnerships that drive organizational success. With a rich background in private equity-backed software companies, Trevor is known for his expertise in creating simple and impactful financial models, he simplifies complex financial data into actionable intelligence.

Key takeaways from this week's episode include: :

Here is a concise summary of the key points from the discussion:

How AI could significantly reduce costs and streamline operational processes, positioning FP&A to be more efficient and strategically integral to businesses.

The importance of mastering the skill of creating clean and straightforward financial models for FP&A professionals. By prioritizing simplicity and clarity, these models become crucial tools for delivering precise financial data for business insights.

The value of experience, mentorship, and strategic thinking in the evolution of FP&A professionals. It stresses how these elements help transition from traditional analytical roles to more influential positions.

How private equity (PE) impacts FP&A operations, setting high expectations for teams to act as the definitive source of truth within companies.

The discussion highlights how PE firms demand thorough, detailed financial reporting and forecasts, reflecting their reliance on FP&A teams to provide thorough insights and accurate analysis to guide investment decisions and business strategies.

The discussion also highlights the anticipation of a future where AI not only supports but enhances the FP&A functions across various industries.

Quotes:

Here are a few relevant quotes from the episode about the strategic thinking around technology investment, the value of networking, the importance of responsiveness in professional settings, and the encouragement for community engagement:

"The best FP&A groups, I've seen, have solidified themselves as a mission-critical function, not just to check the box type of group."

"First and foremost, keep it simple. I think in the sales process, they demo flashy things... focus on what the tool does."

"The beginning of what I'd call a business partnering relationship was when I'd sit down with the business owner and have to intimately understand their business and their financials."

“Dealing with ambiguity, especially when you're working with senior leaders, they constantly vaguely describe things. You, as a professional, need to understand what that means.”

“If you're like a traditional corporate FP&A person or you're just a data analyst, find those opportunities."

Follow Trevor:
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