Why pharma CFOs are embracing a new era of agile decision making
By Mark Bodger, Director at ICit Business Intelligence
Across the country and the globe, organisations are demanding their finance leaders become more strategic, data-driven and collaborative. Nowhere is this more important than in pharmaceuticals, where decisions are taken everyday that could affect the wellbeing of millions. To get there, CFOs in the sector need the right tools. That means shifting away from inflexible systems and manual processes to cloud-based software that can support more agile decision making.
Post-COVID, the focus is on adaptability and driving value through better resource planning and budgeting. That leaves little room for legacy, spreadsheet-centric finance.
How pharma is fast-changing in a post-covid world
Even before the pandemic, the role of the pharma CFO was expanding, with digital transformation at its heart. Back in 2016, nearly three quarters of life science CFOs said they were being asked to adopt wider operational leadership roles, versus 64% of global respondents across all sectors. And 58% said they needed to improve their understanding of sophisticated data analytics to do so. Improved collaboration with teams from across the business, real-time data analysis and insight, and advanced tooling were highlighted as key requirements.
That was then. Today, there is arguably an even greater urgency to these efforts. Pharma finance leaders need to understand forensically where budget is being allocated. And they must be able to plan for the unexpected—and have the agility to refocus operations rapidly in response to fast-moving macroeconomic and global health trends.
None of this can be achieved with traditional tools and manual processes. The old static planning and budgeting model of “plan, execute, plan again” is simply no longer fit-for-purpose in a volatile and fast-moving world. Spreadsheets are too often used beyond their core capabilities, saddling teams with stale, error-prone data and countless challenges collaborating in a hybrid working environment.
Advanced planning and forecasting tools offer a different approach. They deliver countless advantages for pharmaceutical finance teams including:
- Extraction and reconciliation of data across enterprise silos
- Real-time scenario planning and rapid reporting to drive better-informed decision making
- Stress-testing of different scenarios, enhancing corporate agility
- Support for hybrid working
- Reducing the workload on stressed finance teams so CFOs can retain their top talent
- Empowering organisations to boost the bottom line through value-based planning
Delivering a new era of finance innovation in pharma
Recently, Wellcome Sanger Institute transformed its finance function through the use of such tools. Head of Commercial Finance, Allen Swan, and his team realised several years ago that the volume and complexity of financial processes had grown to the point where manual spreadsheets were no longer a realistic option. They added time, errors and challenges around version control that the non-profit simply couldn’t afford.
During the pandemic there were daily, sometimes hourly, changes in scientific activities on the ground and the budgets were changing virtually every day. The finance team has supported this by reforecasting month by month.
The Workday Adaptive Planning added much-needed visibility and transparency for the team. Among other benefits, it has:
- Enabled team members to access a single source of truth, with accurate, up to date data, wherever they are
- Automated mundane, repetitive tasks to enhance consistency and save time, especially in the area of estate allocation
- Introduced powerful scenario planning capabilities to improve budgeting for staff costs and make the organisation nimbler in its world-leading work tracking of new COVID-19 variants
In Wellcome Sanger’s very own words: “With Adaptive we can reforecast so much more quickly. That’s something the management team hugely values because it allows them to make decisions about what they spend their money on or where they need to reallocate. Big decisions are being made as a result of our ability to do regular reforecasts.”