EPM: Budgeting in times of wage and workforce change

The budgeting process can be very challenging for companies, especially for those that do it manually and not scalable. When a company handles a large volume of data, spreadsheets are inefficient for managing the budget.

For businesses, it is critical to know where every penny is spent, especially the ones used for payroll. Salaries make up a significant portion of a company’s expense budget. For this reason, it is essential to have an accurate forecast of expenses to know what the business situation will be over the course of a year, for example.

One solution is to have an EPM software (Enterprise Performance Management). Thanks to the information managed by this tool, businesses can optimize their budget planning process.


Challenges of budgeting in times of wage and workforce change

presupuesto de gastoHuman Resources represent an important part of a company’s economic resources. Therefore, in order to create a good budget, it is essential to consider the salary changes that could occur as a consequence of inflation or company growth.

Likewise, budget forecasts should be made based on estimates of positions and vacancies. In this case, it is recommended that the Human Resources department and the budget team work hand in hand. The company must estimate both salary and workforce changes, as this is the basis for spending.


¿How can EPM help financial management?

Having an EPM to manage the budget and avoid problems related to cash flow for the payment of salaries. But in addition to the ease of payment involved, this type of software also has a positive impact on the way in which employees in financial or planning areas use their time and skills.

Since they will no longer require long hours for estimating, they will be able to spend more time producing better quality analysis that can help support much more timely and accurate decisions. Having an EPM in place can be beneficial for several reasons:

Time-saving. An EPM allows you to create a budget quickly, unlike when using Excel sheets, which process can take several days or even weeks. This provides more time available for teams to analyze the results.

  • Reduced errors. This type of software automates processes, thereby reducing errors that are common in manual processes.
  • Budget comparisons. An EPM allows different budget simulations to compare results, such as best vs. worst-case scenarios.
  • Budget consolidation. With this function, it is possible to obtain a simpler report on the company’s budget status and optimize decision-making.
  • An EPM is also characterized for handling data in real-time, therefore budget management will be based on accurate and real information.

At Fusionworks we can help you with the implementation of a tool such as Oracle EPM Cloud. This is an integrated software for budgeting, planning, consolidating, etc. If you want to know how it works and what else it can offer for your company, contact us!


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