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Understanding rolling financial forecasts

Learn why rolling forecasts are one of the keys to business success

Rolling forecasts

Like many FP&A professionals, you probably have a love-hate relationship with forecasting. The rush to reconcile data from multiple sources, the scramble to pull together hundreds of spreadsheets, the hope that all the numbers line up—all to check whether the business is on track compared to the annual plan. Creating responsive and dynamic plans, budgets, and forecasts is difficult with manual, spreadsheet-based tools. Rolling forecasts can help.

What is a rolling forecast?

Rolling forecasts provide a continuous forecast over a specific time horizon (usually 12-24 months), moving actuals forward each month on a rolling basis and making it easier for decision-makers to see what’s happening in real time. Whereas budgets capture thousands of line items, rolling forecasts reflect specific business drivers such as risk, profit, and working capital. Static, point-in-time forecasts simply cannot keep up with today’s rapid-fire business environment.

Rolling forecasts are an integral part of an active planning process—giving stakeholders the information they need to make data-backed decisions in response to the current business environment.

Why active planning improves forecasting

Static planning causes unecessary hurdles for finance teams

Static planning processes are spreadsheet-driven, manual, and time-intensive. Static planning also keeps stakeholders—even finance—in the dark about how the company is really doing. The role of forecasts is to shed light on performance against budgets and plans, but if those forecasts contain old information, they’re ineffective.

Static planning:

  • Limits your access to the latest financial data
  • Creates forecasts that are out-of-date before they’re printed
  • Plans from a disjointed and static view of the business
  • Delays decision-making due to incomplete models and limited data
Active planning gives finance an easier path to success

An active planning process, on the other hand, enables continuous check-ins through rolling forecasts so you can see whether your company is on track with its KPIs. Active planning puts real-time reports in the hands of decision-makers and empowers the finance team to create continuous, rolling forecasts.

Active planning enables you to:

  • Use rolling forecasts to give you the tools to respond when circumstances change
  • Spend less time grappling with manual spreadsheets and more time measuring progress against projections
  • Access accurate forecast data when and where you need it
  • Adjust and adapt to time-sensitive business challenges and opportunities

How Workday Adaptive Planning supports rolling forecasts

Surviving today’s rapidly changing business environment requires more than an annual plan that is static and inflexible. Workday Adaptive Planning gives finance teams the tools they need to incorporate rolling forecasts and implement an active planning process that enables:

  • Precision decision-making. Forecasts have to be flexible enough to show the impacts of models and what-if scenarios
  • Rolling forecasts. Frequent forecasts with updated data arm decision-makers with the strategic tools they need to respond quickly to changes in the marketplace
  • Aligned business units. Organizational alignment is easier with cross-functional access to real-time, easy-to-use tools and self-service reports
Budgeting for the annual plan with Workday Adaptive Planning

Rolling forecasts can close the gap between data and decisions by increasing forecast accuracy and streamlining the forecasting process. With Workday Adaptive Planning, you can accurately forecast using real-time, comprehensive financials from the cloud.

Active planning allows you to:

  • Access forecast data easily and on demand
  • Avoid wasting time generating manual spreadsheets and resolving formula errors
  • Improve collaboration among finance, operational units, and other stakeholders, so everyone in the organization can view and understand forecasts
  • Run flexible, robust reports using real-time data, not year-old information
  • Continuously forecast to keep your business on track with KPIs and overall company goals

Continuous planning puts patients first at Alternative Futures Group

For the Alternative Futures Group (AFG), a health and social nonprofit based in the UK, implementing a rolling eight-quarter forecast put updated financial data into the hands of decision-makers. Before Workday Adaptive Planning, AFG used a spreadsheet-based process, which made it extremely difficult to run timely forecasts, model multiple scenarios, and assemble and reconcile all of the spreadsheets used throughout the company.

Workday Adaptive Planning helped streamline the planning process, freeing resources to provide better health services to more people in the UK.

Budgeting for the annual plan with Workday Adaptive Planning

Implementing Workday Adaptive Planning allowed AFG to:

  • Finalize complex changes to capital plans quickly and effectively, adjusting forecasts to reflect changes in plan
  • Model multiple, complex what-if scenarios to reflect business opportunities and challenges
  • Increase organizational collaboration to improve alignment with KPIs
  • Provide decision-makers with easy access to accurate forecasts and analysis

Find out how rolling forecasts and Workday Adaptive Planning can revolutionize your business.

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