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How FP&A creates long-term business value

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FP&A’s role is no longer just reporting what’s already happened. It’s now generating insights that support CFOs in long-term value creation.

In brief
  • With increased demand for data-driven insights, CFOs are expected to drive long-term value, requiring FP&A to do more than measure financial performance.
  • To become better equipped to support decision-making, FP&A teams are studying what they’re measuring and how they are demonstrating value.
  • The finance function, and FP&A specifically, has the skill set required to find value creation opportunities and to drive performance management.

Organizations large and small have been impacted by the ever-evolving economic environment, and the speed of change has been challenging. To manage risks associated with this, organizations have realized that there is a need to differentiate themselves and attain competitive advantage at a faster pace than ever. The ripple effects of the pandemic, escalation in inflation, and need to manage costs more effectively have resulted in an increased demand for data-driven insights. Therefore, CFOs are expected to drive long-term value across the organization, requiring financial planning and analysis (FP&A) to focus on more than just financial measures of success. FP&A is examining what they are measuring and how they are trying to show value to become more strategic and agile to support decision-making. The script is changing from reporting what has happened to generating insights that drive more impactful outcomes.

Expanding FP&A role


It’s clear that society, investors and employees are focused on responsible and ethical business practices. This theme is not new. However, organizations realize this is more challenging in practice, and there is work to be done to make this vision actionable.


Who is the best team within an organization to shepherd this forward? CFOs’ responsibilities have expanded across the business, including lead roles in mergers and acquisitions, strategic planning and technology transformations. Additionally, the finance function, and FP&A in particular, operates in the center of the data and has the analytical skill set required to identify opportunities for value creation and drive holistic performance management efforts. Simply said, the finance function is uniquely positioned to hit all angles of long-term value creation (not only financial value).


To effectively respond to increased expectations and accelerate long-term value creation, FP&A is shifting focus from financial value and taking a more central role in customer, people and societal value dimensions.

Value dimensions

Financial value

Improving a company’s value through revenue generation, cost optimization and capital structure

From: a responsibility to be the reporting “scorekeeper” compiling budgets, forecasting, and conducting variance analysis

To: an expectation to answer the question “what will happen?” as opposed to “what happened?”

Why FP&A: FP&A is a champion of data-driven performance management for the enterprise and is positioned to effectively provide this foresight, enabled by timely and predictive insights. Consider the situation at one large construction and machinery manufacturer. Finance expanded its portfolio of innovative technology and processes to include blockchain, robotic process automation (RPA), artificial intelligence (AI), machine learning (ML) and chatbots. FP&A was able to reduce time and effort required to complete a forecast, cutting cost 60%. In addition, accuracy improved by 10%–12% due to the usage of ML, AI and business drivers.

Customer value

Designing, developing, and delivering products and services that meet customer or end-consumer needs, with an emphasis on innovation, trust and brand

From: a focus almost solely on internal data sources, with limited insight or analytics derived from external data sources

To: an elevated role in sensing the customer pulse through reports that integrate external data

Why FP&A: FP&A is highly skilled in integrating data across functions and time horizons to generate a consolidated plan. This is illustrated through FP&A’s leadership in Enterprise Business Planning (EBP), which aligns functional planning efforts with the overall strategic vision of the organization. EBP is an optimized, technology-driven planning framework where finance, supply chain and commercial collaborate to deliver one connected, unified plan on a rolling basis. This plan uses financial and nonfinancial metrics such as net promoter score and market share, to enable the organization to anticipate opportunities and understand vulnerabilities. FP&A uses customer demand signals as drivers of financial performance, providing near-real-time data insights that support responsive reallocation of resources to the products and services in highest demand. Through EBP, FP&A facilitates business partnership by distributing the best information to support management decisions.

People value

Creating value through the employment and development of people, with respect to culture, engagement, high-performing teams, leadership, expertise and skills

From: limited involvement in people value generation beyond the employment and development of finance team members

To: an enabling function that enhances and generates people value across internal and external stakeholder groups through deeper involvement in enterprise talent strategy

Why FP&A: FP&A is well versed in reporting and performance measurement, including integrating data such as capacity, capability, composition and cost associated with an organization’s workforce, to produce holistic performance packages. An example of FP&A’s role in people value can be seen through workforce planning, which is the process of analyzing, forecasting and planning workforce supply and demand to put the right people in place to fulfill strategic objectives. As part of this process, FP&A uses personnel costs as a driver to create linkages between strategic plan and measurement of outcomes. While HR teams own workforce planning, they do partner with FP&A to effectively analyze and plan for the needs of the organization regarding size, type, experience and knowledge of its workforce.

Societal value

Impacting a company from an environmental, regulatory, community and economic perspective

From: little to no involvement in societal value creation

To: a meaningful role in the reporting and accountability of the broader sustainability agenda

Why FP&A: FP&A is taking measures to define standards at the corporate level and provide the required cross-functional connectivity and accountability as these standards trickle into business units and profit centers. Consider the reporting of an organization’s environmental, social and governance (ESG) measures against stated goals. This topic is top of mind for CFOs as investors encourage strategies that use ESG measures to inform diversity, equity and inclusion (DEI) initiatives and more responsible and sustainable investments. While this trend is nascent and still evolving (due to not well defined ESG metrics, data that is not easily captured, and a process that is not repeatable), public companies are facing continued pressure from regulatory agencies and investors to increase transparency, consistency and disclosure of ESG information. Organizations rely on the chief sustainability officer (CSO) to lead this effort, with the finance function and FP&A teams involved to a moderate extent in the process of collecting, processing, reviewing and reporting on ESG data. Proactive FP&A teams are not only ready to incorporate ESG-related metrics into the planning process, but also to help hold all levels of the organization responsible for delivering on these defined metrics.

As expectations of the finance function continue to grow, delivering value across all four dimensions of the EY value framework will be imperative. FP&A is focusing on three levers to stay ahead of the curve.

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    The role of FP&A in today’s organizations' is evolving from reporting what’s happened to generating insights that drive more impactful outcomes to support CFOs to create long-term value.

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