How Finance and Supply Chain Teams Can Align for Better Decisions with Lyndsey Weber & Marcia Williams
In this insightful episode of FP&A Tomorrow, we explore the dynamic relationship between Financial Planning and Analysis and Supply Chain Planning. Host Paul Barnhurst aka The FP&A Guy discusses how these two critical functions can work together to create better outcomes for businesses, particularly in challenging environments. With supply chain disruptions and evolving market needs, aligning these disciplines is more vital than ever.
Guests: Lyndsey Weber, a seasoned expert with a background in supply chain and finance, and Marcia Williams, a supply chain planning professional with roots in accounting. Lyndsey transitioned from ExxonMobil to tech, where she focuses on optimizing supply chain planning with financial insights. Marcia brings a wealth of knowledge on integrating operational and financial strategies to drive value and efficiency.
Expect to Learn:
How FP&A and supply chain planning intersect and complement each other.
Key differences in planning horizons and decision-making processes between FP&A and supply chain.
The role of integrated business planning (IBP) in achieving cross-functional alignment.
Strategies to enhance communication and collaboration between finance and supply chain teams.
Real-world examples of overcoming challenges during the COVID-19 pandemic and creating value through supply chain optimization.
Here are a few relevant quotes from the episode:
"Every company has supply and demand, whether it's a product or a service. Matching them is the core of supply chain planning." - Lyndsey Weber
"Finance and supply chain must combine top-down and bottom-up approaches for effective planning." - Marcia Williams
"The more granular focus in supply chain planning complements the high-level strategy in FP&A." - Lyndsey Weber
From breaking down the barriers between FP&A and supply chain to leveraging collaboration for unlocking new opportunities, this episode highlighted actionable strategies for creating alignment and driving business value. Finance and supply chain are two sides of the same coin, and when aligned, they enable better, faster decisions that benefit the entire organization.
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In Today’s Episode
[01:43] - Meet the Guests
[04:09] - Career Shifts and Lessons Learned
[07:38] - Understanding Supply Chain Planning
[12:21] - Challenges in Integrated Planning
[17:51] - Ensuring Cross-Functional Alignment
[26:59] - Leveraging Metrics for Better Collaboration
[37:00] - Key Advice for FP&A Professionals
[42:14] - Skillsets in Finance vs. Supply Chain Planning
[49:56] - Fun and Personal Insights
[54:10] - Conclusion
Full Show Transcript
[00:01:43] Host: Paul Barnhurst: Welcome to this LinkedIn live FP&A Tomorrow. As many of you know, FP&A Tomorrow is a podcast where we talk all about financial planning and analysis. Except for today we'll talk a little bit of supply chain. So we'll mix it up here a little bit. But, you know, each week we're joined by thought leaders, industry experts and practitioners who share their insights and experiences. I'm the host of the show. My name is Paul Barnhurst, aka The FP&A Guy, and I'm super excited to have two great guests with me. But first, let's see, we have one guest that's come in. So he said it's evening for him. So good evening for you. Joining us from South Africa. We got Sammy from Long Island, New York, Carolina from Switzerland, Carolina Lago, great. Obed joined us from the Netherlands. So they're all starting to come in Argentina. So we got quite the group all over the globe. So thank you for letting us know. Keep those coming. We'd love to know where you're dialing in from. And Carolina says you have better jokes Paul. So that was an improvement. The Eiffel Tower. So that's good. I'm glad you like that one. All right. Why don't we start? Lyndsey, if you could just take a minute and introduce yourself.
[00:02:52] Guest1: Lyndsey Weber: Yeah, sure. Hi, everyone. Thanks, Paul, for the time today, Lyndsey Weber I am currently in the sales team at oh nine, which is a supply chain planning software. I'm based out of Tulsa, Oklahoma, currently used to live in the Houston area. And yeah, really excited to be here with you, Paul and Marcia today. This is going to be a lot of fun. So thanks for the opportunity.
[00:03:12] Host: Paul Barnhurst: Yep. You're welcome. Thanks, Lyndsey. Marcia, why don't you go ahead and introduce yourself.
[00:03:16] Guest2: Marcia Williams: Yes, I'm Marcia Williams, happy to be in the show with Paul and Lyndsey. I work in supply chain planning as an OP, so this is my favorite topic and looking forward to the conversation.
[00:03:34] Host: Paul Barnhurst: Great. Thank you so much and just keep questions and comments going in the chat. I'll keep an eye on that throughout. So if you have questions as we're going through things throw them in the chat. We'll get to them when we can. Also continue to let us know where you're coming from. But let's go ahead and get started. So today's goal is to discuss supply chain and financial planning, something we probably all get to deal with at some point in our career, whether we work in supply chain or finance an overlap between the two. So, Marcia, we'll start with you. You started your career as an accountant, but you focused today primarily on supply chain planning. So tell me a little bit about your journey, kind of how you went from accountant to being, you know, strictly on the supply chain side?
[00:04:15] Guest2: Marcia Williams: Yes, I know your background, Paul. That's also interesting because I started in accounting and then I wanted to take more action, like to be in the place where we create a value.
[00:04:33] Host: Paul Barnhurst: Sure.
[00:04:33] Guest2: Marcia Williams: And that's when I decided to get an MBA and I went to Michigan State. So from my home country, that is Uruguay in South America, I went to Michigan, and then I got my MBA and you started working. Everything related to supply chain. Initially my area was procurement, but then I did a lot of different activities in the different areas within supply chain and always working with finance as well. And my focus is in planning, so I have been in the different areas.
[00:05:18] Host: Paul Barnhurst: Thank you. Appreciate that. Yeah I can totally understand accounting wanting to be more in the business. Funny enough, I went to Arizona State, which is another supply chain school, much like Michigan State. We had professors from there, and I originally planned on doing supply chain and decided to do a finance degree instead. So definitely some similarities there. Lyndsey, tell us a little bit about your journey. I know you've done sales, you've done some supply chain, you've done some finance, a little bit of everything in there.
[00:05:43] Guest1: Lyndsey Weber: Yeah, I started my career at ExxonMobil, in the chemical company in their global supply chain. So background wise, I have what I typically call an industrial engineering degree. It's actually called engineering management. So it was kind of a fusion of operations research business and ERP. Actually, I took an SAP course in college, which I feel like is maybe a little bit rare. And yeah, started my career at Exxon in the supply chain and did a bunch of different roles from kind of global project management and supply chain process optimization to packaging to a supply planning role as my last kind of turn through the company. And then to your point, Paul, I made the switch right over the pandemic to tech, and I joined a financial modeling software company called Quantrix and had spent a lot of time building Excel models at Exxon. And so I was pretty familiar with what it takes to build a business case and kind of speak the language of, to your point, Marcia, right, of how do we take the considerations from a finance piece and then go operationalize it and actually bring the value through supply chain. So join Quantrix on the pre-sales side of the business and had a great time learning about mergers and acquisitions, very traditional strategic financial models and the decisions that people have to make. And a lot of times, the challenges that they have using the tools that they have available in their organizations. And then about a year ago, I switched to my current company, which is 09, and it feels like a great kind of marriage of all of those things. It's supply chain planning software, but a lot of our conversations, which I'm sure we'll dive into today, are about how do we make better, financially informed decisions within the supply chain. And I think that's kind of where a lot of the conversations are in my current role at 09.
[00:07:28] Host: Paul Barnhurst: Great. Yeah, I know there's definitely a lot of overlap for sure. So next question. This one's for you, Marcia. I'd love to get your thoughts. What all is typically involved in supply chain. When I think supply chain I usually think logistics procurement. But maybe talk a little bit about what are the typical kind of roles within supply chain, particularly around planning and the different areas.
[00:07:50] Guest2: Marcia Williams: Yes, that is a great question because in general planning, we other team members like outside from supply chain, they don't see that. So that's one area that is all related to planning and is related to strategy. Then we have other areas that are more related to execution. And they are yes, we can find all the links with operations. We have links of course with logistics, everything related to warehousing and inventory. We have it from planning all the way. So those are different areas that they are. Ones are strategic more that is the focus and other areas are more for related to execution. Operational. Looking at the short term day to day.
[00:08:55] Host: Paul Barnhurst: And that makes sense. Right. You got your strategic planning, your big picture, your long term and your operational planning. And, you know, finance is awfully kind of sits in the middle between that strategic doing, the financial planning. But then they also have to make sure it links to the operational. And in an ideal world, which hopefully you see, not always, but a couple other people have joined us. We got one from Dubai, looks like someone from India. So we got a good, good audience out there. Keep letting us know where you're coming from. Ask your questions. This next one's for you. Lyndsey. How would you define if I asked you to say, hey, tell me what supply chain planning is? And then FP and A and maybe kind of how they're similar how they're different. Give us your view on that. We've talked about it before and I kind of like the way you shared it. So I'd love for you to share that.
[00:09:42] Guest1: Lyndsey Weber: Yeah. I think, you know, one of the ways that I like to think about it and to your point, we've talked about this before, is when we think about supply chain planning, when I think about supply chain planning, I think it is in most cases, what people consider the physical component of the supply chain, right. So talking about the details from how we used to describe it at Exxon would be from your suppliers, suppliers or even your suppliers, suppliers, suppliers. Right. All of the raw materials through to the finished product and how you get that to your end customer. And from a supply chain planning perspective, it's really all of the decisions that go into how do you satisfy and match up your demand to your supply. And I was actually talking to some friends last night about supply chain and said, you know, every company has supply and demand, whether you have a physical product or you sell a service, there is always demand and there's supply that you need to match with that. Right? And so I think one of the key differences from my perspective and from my experience between supply chain planning and kind of FP&A is a lot of times the level of detail that you have to plan and decide at in supply chain, I think is much more granular and kind of tactical operational to begin with.
[00:10:52] Guest1: Lyndsey Weber: When you are trying to decide where do we source that raw material from? How do we expedite orders to satisfy customer demand, things like that? I think from a traditional FP&A perspective, or at least with a lot of the customers I worked with at Quantrix, it was a lot more strategic. So kind of pulling that up to the 30,000 foot level and saying, well, what do those lower level supply chain decisions, what is their impact on the PNL, on the balance sheet? And so we're looking at that more from the true financial implication. And I know we'll talk about this, but there's an increasing need to kind of dovetail those together, because when we're making those lowest level decisions in the supply chain, we do need to be actually thinking about how do we pull that thread and where is this going to have implications when we do get to the balance sheet or to the PNL?
[00:11:38] Host: Paul Barnhurst: Sure. A decision you make that increases. Inventory is going to have a big impact on the balance sheet and also on carrying costs, which can end up in the, you know, the PNL. And if finance doesn't know that, then there's that variance and they're scrambling to go, what happened? Why? Why is our expenses here on a cost of goods sold higher or wherever it, you know, it may be the carrying cost, those type of things, trying to understand them. So I get it. I love that. I kind of pull that thread and make sure everything's aligned. I'd love any thoughts on that. Marcia, you have any thoughts to what Lyndsey said there? Just kind of how you see the differences. I know you just did the Wharton program on FP&A started as an accountant, so I know you have a lot of experience on both sides of this as well. So I'd love your thoughts.
[00:12:21] Guest2: Marcia Williams: What Lyndsey describe is one of the key challenges in supply chain, because when we talk about the planning, we have a process, right? That is called sales and operation planning. Sometimes there are other terms like integrated business planning when it is more advanced. That is one process for planning that it should be done at a higher level, right? We don't look at each scale. We look at product families at that level. We need to extend the horizon up to 18 months if possible, not just to look at 2 or 3 months. Then there is another area within supply chain. And sometimes that is exactly the challenge when they are mixed together, that is sales and operations execution. That yes, is at the SKU level is much more granular. So one of the challenges that I have seen is that there are many companies where we have that mix, like they are doing more sales and operations execution at that level. So it's critical to define the levels. And yes, finance also the approach that is top down right. Supply chain typically they do bottom up and it's very detailed. So we need to combine both right. Because we also want to know how we are doing with the financial targets and the implications and focus on what really matters. And at the same time we also need that granularity. But in my view is two processes that are different.
[00:14:21] Host: Paul Barnhurst: Okay. So yeah, so I'd love to dive into this a little bit more because we hear a lot of terms or buzzwords, buzzwords with planning. Right. And then obviously traditionally you had to have a you had S&OP, you have integrated planning, today you have XP&A or connected or continuous, all these different terms you're hearing. And is there really like a fundamental difference between all of these or is it at the end of the day, there's different levels of planning that needs to happen. We need a framework and you need to make sure it's all consistent kind of across the board. And I'll get both your thoughts on this. So Lyndsey, I'll give you first take on that kind of how do you think of it when you hear these different terms when it comes to planning?
[00:15:00] Guest1: Lyndsey Weber: Yeah, I think it's a heated topic of debate. I actually think, Marcia, you have a lot of beautiful infographics on LinkedIn. So if anybody doesn't follow Marcia, make sure you do because they're amazing. I think there was one at one point that was comparing FP&A to S&OP. And it was like a huge debate in the comment section. And so I think a lot of people have different interpretations of what those mean. I think one of the key differences between them that is important to note, and Marcia, you mentioned it is the planning horizons, right? So not every one of those activities is planned at the same kind of time bounds. A lot of times, like snow, right. It's very tactical. It's very operational, almost day to day. We're trying to fight fires and close gaps. FP&A and even I would say IBP, which you mentioned as well, Marcia. Right. Typically tends to be more longer term. So I think the key to focus on with each of those different terminologies, FP&A, Zappa, S&OP, IBP is what are the key questions we're trying to solve and what is the time balance of the criticality right of those answers that we need to be able to act upon and make sure that we're meeting whatever those goals are. So I think that would be my maybe biggest piece of advice. I think there's a ton of overlap between those and probably some semantics on even at the organizational level, what some people might call S&OP and another company might call IBP. So I think it depends a little bit on the maturity of the supply chain organization and the finance organization. But I think there's more in common than not. But you have to get the goals and the timing balance, I think, right, to make sure that we're solving the right problems at the right time.
[00:16:41] Host: Paul Barnhurst: I love the last part. You said at the end of the day, make sure you're solving the right problems at the right time. You have the right goals. Call it whatever you want to a certain degree, right? It's like the debate stepping away from supply chain rev ops. Does it sit in FP&A? Should it sit in the, you know, your go to market and your CRO should FP&A do sales commission? Should HR? At the end of the day, it doesn't matter to a certain extent. What matters is you have the right culture, the right organization, and everybody understands the frameworks and the tasks they have and you're aligned. Which gets to this comment by Ezekiel. Then we'll come over to you for your thoughts on this. Marcia, who can relate to this? Ibp never matches with financial planning. At least that first version. I'd say S&OP and FP&A operational. Often it doesn't match. If you've worked in planning, I'm going to guess everybody here on this call could raise their hand that they've been in a meeting where I don't recognize that number. I didn't submit that number. Right. Finance must have done that or that was operational planning. They didn't align with us. And I see Marcia chuckling. I see the smile on Lyndsey's face. Right. We can all relate to it. It's keeping everybody coordinated and aligned, whether it's supply chain, whatever type of planning is tough. But I'd love your thoughts on the different terms. Marcia. Any thoughts there you'd like to add?
[00:18:05] Guest2: Marcia Williams: Yes. The key as we were talking is that these processes need to help the business. So if to make decisions, making the decision, considering the business as a whole and not each individual function, that is the objective. And there are different terms. Just more to highlight the maturity in the process. Initially, as an OP was all about balancing demand and supply. So it was within supply chain and we work with marketing and sales, but we didn't have finance too much involved in the process. So now there are new terms to make it like a cross-functional process. And that's why we see IBP. But we need to be clear, like on the objective, what we are looking for with this. That is decision making. That is an alignment, right? As you mentioned, Poland and Lyndsey.
[00:19:19] Host: Paul Barnhurst: Yeah. And we'll definitely get more into alignment here shortly because that's where we end up with the I don't recognize that number that we all deal with. But I like that you said help make decisions. I love a CFO. The former CFO of Grammarly, Stu West, I did a webinar with him recently. I think it was last week, and he made a comment when he asked what, you know, we asked about finance. He said the role of finance. He summed it up in three words, and I'd never heard it said this succinctly. And I think this applies a lot to planning, particularly helping. He said better, faster decisions. That's what we help the business do make better, faster decisions. And I think planning a lot of times, all of that is really to help the business make better, faster decisions. And I thought that was just a brilliant way to sum it up, where I'm like, okay, hard to argue with that. So before we get into a little bit of cross-functional and alignment and some of those things, I want to ask a question just to kind of get some thoughts and we'll go with you here.
[00:20:20] Host: Paul Barnhurst: First, Lyndsey, on this supply chain and supply chain financial planning. I've seen, you know, finance, I've seen supply chain sit in finance in the sense that they're often called finance, supply chain planning. I've seen them sit in supply chain. Do you think companies need like a financial supply chain and a supply chain team, or are they just different names for the same thing? Or how do you what have you typically seen? How do you think about it? When it comes to business planning, staying ahead means planning smarter. Whether it's forecasting, budgeting, our long term strategic planning, you need a solution that's built to scale with you. That's why more growing businesses turn to workday adaptive planning. It's designed to empower organizations to move beyond spreadsheets and into a connected, agile future with powerful AI. Workday Adaptive Planning delivers insights that help you make better decisions faster. Our advanced data visualization and powerful reporting tools make it easier to elevate your budgeting, planning, and modeling. It's time to start planning smarter. Discover how at www.workday.com.
[00:21:42] Guest1: Lyndsey Weber: Yeah, I will say personally, it's been rare that I've seen finance embedded within the supply chain, though it's a great idea. I think, you know, getting to what we were just discussing as well. To me, the importance is kind of both directions, making sure that people in supply chain have at least a general understanding of what are the financial implications of the decisions we're making. Right? Even just, you know, basics of understanding, as we were talking about like, what are the lines on the PNL? What are the lines on the balance sheet, and which of those line items are contributed to by decisions we make in supply chain? I think that's really important. From the flip side, I think, you know, from a finance perspective it is very helpful. And we've talked about this, I think, in previous conversations, Paul. But I think it's amazing if you can actually get out into the field, if you will, as a finance person or, you know, if you're in a different function because it's so, I think, complex and nuanced, the amount of decisions and the interconnectivity of those decisions and supply chain, I think I've, I've mentioned the packaging piece before, but even when I was at Exxon, you could make we made one change to the height of a wooden pallet. Right. Which is what we shipped a lot of our product on. And that one inch of a change on a pallet doesn't really sound like a big change, right? It's a nice little, you know, maybe performance boost.
[00:23:08] Guest1: Lyndsey Weber: Or maybe we found a way to cut costs with that incremental change. But it's not until you get out into the field and realize that that one inch actually means you can stack an entirely one fewer level of product on a truck or an entire right 100 bags now can't fit on every pallet because of this tiny little what you thought was an optimization change. So I think when we talk about where should finance sit in relation to supply chain, should there be people embedded? Maybe if that's what works, to ensure that those lines of communication are opened and we're making sure the decisions we're making upstream and downstream are actually truly optimizing the plan that we have. I think somebody Andre said that right. Always making sure IVP aligns with the long term strategic plan. We need to make sure that all of the decisions we're making, especially the small ones that maybe seem like they're good optimizations in a vacuum, are in fact, still good choices for us to make long term. So if people in the call do sit in supply chain and you're a finance role, I'd actually love to hear more about that. I think that's a really interesting approach. It's not one I've seen very often, but I do like the concept.
[00:24:12] Host: Paul Barnhurst: What's your thoughts, Marcia? Do you have a kind of preference of how this should work or what you've seen.
[00:24:18] Guest2: Marcia Williams: When companies refer to an S&OP typically is in supply chain and or we have a person. But of course we need to have finance involved because we always need to check against the target. How we are doing that is for sure is very important. What I have seen is that when a company decides to have more maturity and have more, more that integration with finance, that is not only to get to the metrics, because now in S&OP, yes, we have just on average S&OP, we have metrics that are related to finance. But to see how we were saying, okay, but what is the impact on this line on the PNL that is more advanced? And that is when sometimes they call integrated business planning and to get the buy in from the organization. This is what I have seen in companies they have financed leaving that instead of supply chain. That is another approach. There are others.
[00:25:37] Host: Paul Barnhurst: I've seen that in some of the consumer goods space where there's a finance supply chain team that's kind of leading it from a finance perspective and working with the S&OP and the rest of the teams. That's kind of where it came from. I've trained a few companies where a lot of people have the title. You know, they're doing a supply chain role, but they're part of the finance organization. So not a lot, but I've seen it a few times, so that makes sense. All right. Keep the questions coming. If you haven't let us know where you're coming from let us know. We got a quick joke because we got to break it up here. And then we'll next question will go back to you. You, Marcia. So who knows why you take an extra pair of socks to the golf course in case you get a hole in one. All right. I got a few laughs. That's all I could ask for. All right, cross-functional planning. Right? That's something we should all be doing across the business. It's really critical today as things have just accelerated since Covid, right. Everybody struggled with supply chain, logistical issues, raising capital shortages. List goes on and on and on, and planning and scenario planning and all that became more important. So what's your take? How do you ensure that finance and supply chain teams are on the same page, that they're aligned? Because we've all heard of the different people say here, it never matches. You know, often you have challenges. We've talked about different numbers. So what are things you've seen? What's your thoughts on how you ensure that you're really collaborating and you're not building in a silo, so to speak?
[00:27:09] Guest2: Marcia Williams: Yes, indeed. Process, it's true, right? The most advanced companies. They get to one set of numbers. But the reality is that there are three, four, there are several. And we see the differences. So if we follow this process, the NLP process, we start with the demand review. Then it will go to supply and then finance because they need to see the different implications. There are different ways to achieve the target. So for example new product introductions they want funds for that sales. They may need to do a new promo campaign. Supply chain will say we need more like or more workforce or more inventory. We need to invest in that. So then when they move to finance. They can see and the different ways and evaluate the impact. And then the decisions will be done by management. So that is the process. But of course in the demand review supply we will have those numbers different.
[00:28:32] Host: Paul Barnhurst: Yeah and I agree that's typical supply right. You go and say hey here's what we're trying to accomplish. You get all the numbers from them. Finance says okay here's some different ways we think we can achieve this. Management looks at it and says we want to go with option three or scrap all these. We're going to go with this. But how do you ensure once management says, hey, we're going to go with that. Those details get filtered back and plans get updated. So there's alignment because at the end of the day, if you've agreed with one approach ideally and I say ideally, you know it should stream throughout. So any thoughts on how you kind of make sure it gets back to people after me because I've seen it, where management makes a bunch of changes and sometimes they say, just push it to everybody and you're like, but wait, that's just going to create a nightmare. Everybody's going to not understand their numbers. So any advice there of how you kind of make sure that back end communication happens?
[00:29:26] Guest2: Marcia Williams: That is the function of snow. So what we talk at the beginning to have sales and operation planning. Now we are moving into snow. So this is to have these meetings all the same sequence. But it's going to be different. And if there are issues there they need to escalate. So we can come back to snow because we need to make adjustments to the plan based on execution. So that's the key when we have both working well. And that way in my view they should be separate processes. They are working together but separated. That is how we can work better. And we did that in the pandemic. I have many examples. That is when snow started to be more in.
[00:30:22] Host: Paul Barnhurst: Feel free to share an example. I'd love to kind of hear an example you have from the pandemic. So if you want to share one, go ahead.
[00:30:28] Guest2: Marcia Williams: Sure. For example, we had on the plan, right? They made a decision on a certain number of product that they needed. But then when it goes to show that we see materials for that part of procurement getting the materials, we couldn't get that. So materials needed to communicate back materials is in snow. So materials needed to communicate back to supply planning to tell them that they cannot build that number of products and that happened with packaging film, for example. One of the hot items to get so and that is how they made the change in the plan.
[00:31:20] Host: Paul Barnhurst: Got it. You know, I kind of laughed as we talk about, you know, Covid. I have my training partner, good friend Ron Monteiro. He worked for a company that sold toilet paper, you know, sold paper products, but one of them was toilet paper. And so, yeah, it was trying to, you know, keep the supply. It was a crazy year for him. He's like, yeah, I think we beat budget by like 50%. But the next year wasn't much fun as it's always like, well, how are you going to increase it? You know, we can't like that's not going to happen. So, Lyndsey, your thoughts on this kind of whole discussion and trying to make sure we have alignment?
[00:31:54] Guest1: Lyndsey Weber: Yeah, I think Marcia captured it really well. The other couple comments I'll make on this, and we've touched on them a little bit, is I think there needs to be alignment across, I would say four key areas. One is of course, as we said, process making sure people understand what are the steps, let's say across the monthly planning cycle where we're meeting certain gates, there are certain outputs and plans that are either being finalized and things like that. Of course, the time component, right. As we said, there needs to be alignment across the planning horizons that we have that we're trying to lock in those decisions. The other two pieces that we haven't talked too much about, I would say, are data and technology. One of the issues, right. Of course, with, as we were just describing the, you know, the first version of the FP&A versus the IBP, it doesn't match a lot of this is actually not related as much to, you know, relational collaboration between the teams. And it's more just how is the data stored and structured today and who has access to what and when those changes are made, how does that data get translated back into your ERP or into your production plan or into your warehouse management system. So the data piece we could have an entirely separate conversation on.
[00:33:07] Guest1: Lyndsey Weber: But that's a huge component of the supply chain planning. And the process is making sure we understand where the data is coming from and how it evolves over the planning cycle. And then I think the final thing I would mention that, you know, Marcia, you kind of touched on it right there at the end. A lot of times what we talk about in my current role is we call it post gaming. So after you have those management approvals and we make a change to a plan or we commit to, you know, making an alternative scenario and going and executing on that, there should be one more step beyond that where we come back, let's say a week later or a month later and we post game it. So we say we made this decision. Did we follow through on it? What was the outcome? Was that the expected outcome we thought and if it was or wasn't, how should that change the way that we make decisions similarly going forward? So I think you have to have that kind of continuous process of not only improvement, but actually keeping the teams accountable for. Did we actually execute on what we said we were going to do and what was the actual outcome, and how can we incorporate that going forward?
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[00:35:28] Host: Paul Barnhurst: Yeah, it feels like that fourth one you call gaming accountability and monitoring. Yes, that continuous monitoring. Number three data. Come on. Our numbers always align. That's never a problem. We've we've all dealt with that is I everybody's heard the quote by a lot of people probably heard by George Box where he says all models are wrong. Some are useful. I saw a similar quote related to data, and I'll tweak it a little bit. It was all data is wrong. Same idea. Some is useful, right? You know, it's like if anyone has perfect data, they don't have any data or they're lying.
[00:36:06] Host: Paul Barnhurst: It's one of the two. There's no such thing as perfect data. It's. Is the data good enough to make decisions? And I still remember early in my career we had one report where the numbers were, like different by a billion. And once we start explaining it all, it made sense. But on the surface it's like, wait a second, 3,000,000,002 billion. How can we have something that's supposed to be similar and have completely different numbers? Turned out they were really explaining something different. Right. As you dig into it, there's usually explanations, but sometimes it's just we define things different. Yeah. How often does finance have one definition for something and, you know, marketing or supply chain or S&OP or whoever has a different definition and you just find out, oh, we're really working with the same numbers. We've just defined them differently, which results in a different ratio or a different, you know, Your number. I see both of you nodding, so I know you can both relate to that one. All right, so here's a question for you and I'll start with you, Marcia, on this. Love your thoughts. I think often the finance struggles with feeling like they're not connected with the business. They're not getting the information they need. So maybe things aren't filtering back to them. If you're in that situation as a FP&A professional, any advice on maybe how to make sure you get closer to supply chain and you're getting the information they need. Any things you'd recommend somebody do if they're in that situation?
[00:37:32] Guest2: Marcia Williams: Well, my recommendation is to know some of the key metrics or the language that supply chain speaks that I typically say to other supply chain practitioners, like, we need to learn the language of the business that we finance. So of course we need to learn that to communicate and that everyone can be aligned. But for finance, they can see some metrics that we know, metrics they can understand the future, we can take one that for supply chain is critical. Everyone will tell you this one. First I think is on time in full. Right. All this is a very famous metric. But if you see how Venus is performing, you can see if the plan will be met or not. Because if, let's say that on time is fully 60% or lower, that is bad, right? So you can see those numbers in the plan it gives you. You can challenge those numbers and you can understand also, well what happened in there. You can identify the reasons and work with supply chain because they are not going to hit the targets. The business is not going to hit the target. So that is one key metric. Of course, everything related to inventory, it has a huge impact. So other metrics like fill rate, how can we meet that. How we are doing. So I think there are some metrics, as I mentioned, that can help finance to understand operations more.
[00:39:30] Host: Paul Barnhurst: Got it. That makes a lot of sense. Lyndsey. Anything you'd add?
[00:39:34] Guest1: Lyndsey Weber: I think Marcia is exactly right. The other way I would think about it. And just coming from my time especially, I guess at Quantrix, when we're building these very high level strategic finance models, there's always a set of 50 or 100 assumptions, right, that we make. And I think an interesting exercise, if you are in finance and you want to build that relationship with supply chain or understand it more, is similar to what you were saying. Marcia, like, double click into those assumptions, right? Your first level of assumptions is maybe total sales, right? Or you have a growth rate or something, right? Some kind of a driver for your cost of goods sold. Peel a layer right off of that and say, well, what are the components that contribute to my cost of goods sold or to my working capital to Marcia's point, and then double click into that. And once you get to the point where you don't have the answers to those questions, find the person in supply chain who does. Right. Because I think that's where you start to get a lot of the interesting context and story around where these assumptions that we have at the high level from the income statement and the balance sheet and the PNL coming from and truly, who are the people right down them on kind of the base level of the supply chain that are seeing that firsthand? I think maybe that's a great way to start the conversation with somebody in the supply chain organization to say, hey, here's the view from my PNL lens, right, of what's happening. And here are the assumptions I'm making. But what assumptions are you making, right, that are kind of feeding right into this high level assumption that I have? I think that can sometimes be a really interesting dialog.
[00:41:06] Host: Paul Barnhurst: I love that it kind of reminds me of, you know, kind of the five whys when you're trying to get to the root of the problem. It kind of keep asking, you know, I need to go talk to this person or that person, and you really start to understand what's made in the build up of that. It's high level assumption is made up of these 30 things. It's like, okay, now next time when numbers are wrong, I know I can go talk to these three different people or whoever it might be, but I think that's I think that's great advice. Just going to give a minute here. If anyone has any questions for Lyndsey or Marcia, put them in the chat. Let us know. I might do one more joke here. And then we got a few more questions and we'll move into kind of a fun section and a little bit of Q&A. So does anyone know what the difference between an accountant and an FP&A professional is? Alright, here we go. When an accountant gets creative, they go to jail. When an FP&A professional gets creative, they get promoted. So there you go. That's why I'm in FP&A. Not accounting. I'm too creative or something like that. So I'd love to get some thoughts and I'll throw this out to either one of you, you know, or both of you. You can take this how you want. What do you see as kind of the key differences in skill sets between supply chain planning and finance planning? Are there real kind of key areas where they're different, maybe where they're similar? Would love your guys' thoughts on that. Maybe we'll start with you, Marcia, if you have some thoughts on that.
[00:42:29] Guest2: Marcia Williams: I think the difference is just the language, because we need to do in supply chain is very granular. So sometimes I think we lose that broader view. And we started like focusing on some products that they don't have a significant impact. So that is the difference that I see. More related to the approach and the language. But then we need to then the rest. I see many similarities, even the challenges when I was looking at the FP&A process. Right. There are many similarities. Even when we send the pre-reads, we need to explain the variances. So I see more similarities than differences.
[00:43:37] Host: Paul Barnhurst: Got it. And that makes sense. What about you, Lyndsey?
[00:43:41] Guest1: Lyndsey Weber: Yeah, I totally agree with Marcia. I think way more in common than not. I think clearly, yes, having an understanding, as we've said many times already, of just basic finance, I think everyone, even if you're not in supply chain or finance, everyone who works in any kind of company should have a basic understanding of, you know, what's what's in a PNL and how do we get the the numbers right, and why is that important? I think one of the interesting similarities between supply chain planners and maybe FP&A is we both exist to serve stakeholders. And I think that that can actually be something that brings these two functions together. Right. I think to Marcia's point in supply chain, we're oftentimes much more focused on the specific issues in front of us as far as how do we make sure that this customer gets their order on time, or how do we make sure that the decisions we're making help our manufacturing plants to run at full speed and capacity? Right. How do we make it easier for those people or make sure that we don't have disruptions To, you know, runtimes, finance, like the stakeholders are oftentimes like the stock holders, right? Like the actual investing people in the company and or the end consumers. And I think you can actually bring these two organizations together to say, you know, in both cases, we need to serve the same group of people. One group is maybe focused more so on the very near term tactical, I would say even almost like customer experience of how people perceive the brand. But then those people end up being potentially investors in your company as well. So both actually play, I would say, a really significant role in how people perceive the company and the organization you work for, and that's something that we should use to kind of align our teams together, I think, towards a common goal.
[00:45:26] Host: Paul Barnhurst: I like that, and I think that's great on that alignment and that common goal, because the more the teams are aligned, the more you're going to have the cross-functional collaboration, the sharing. I mean, at the end of the day, we're all trying to do the same thing. We're trying to help the business achieve its long term strategic goals. Often the day to day takes over. Like you said, the customer that they got their order and it's all messed up or we're late on this or the machine that broke down. And so now we can't make 50 widgets or we missed on the quarter. How do we get the business to fix it? And from a finance perspective, all those type of things can take precedence. But at the end of the day, it's all lying back to helping. The planning should all tie back to what are we trying to strategically accomplish, regardless of whether it's financial, supply chain, marketing, S&OP, we could use it. We could come up with a million different acronyms, right? But at the end of the day, when I think about it, that's the simplest way I can break it down. There's different time horizons, there's different data, there's different assumptions. But we should all be focused on helping the business achieve its strategic objective.
[00:46:35] Guest1: Lyndsey Weber: Yeah, totally. I think to the last comment I'll make on this is that I think is interesting in Murcia. I'd be interested if you've seen this as well. But in a lot of the customers that I've spoken to recently, it's been very interesting to see that there are kind of value unlocks happening coming straight out of decisions being made in the supply chain. So I think in particular, especially in the current market conditions, there are a lot of companies that are cash constrained looking for ways to free up cash flow, looking for ways to do more with less. And I've actually seen many stories recently of customers who have partnered with their finance teams to say, you know, where are you, the value leakage opportunities in the company or places where we could open up completely new areas of value that could benefit the business in other areas? We had a customer a couple of weeks ago, several weeks ago, that spoke and said that optimizations they made in their supply chain completely funded their IT roadmap for the next five years. So a completely unrelated value creation opportunity that started right in supply chain and finance, working together to say, let's make some changes in here. But the benefits are actually being felt and experienced far outside and beyond the supply chain organization actually helping the company. You know, technology roadmap can be achieved earlier and sooner, you know, with the cash flow that's been unlocked, which I think is really cool.
[00:47:57] Host: Paul Barnhurst: I love that, you know, trying to end revenue leakage or expense leakage that can be invested elsewhere. Marcia, thoughts on that? What Lyndsey just said there.
[00:48:05] Guest2: Marcia Williams: Yes, that's a great example. And when we work together, we financed in particular related to inventory. If we can optimize inventory, I don't use the word minimize on purpose because we don't want to have lost sales either. So is that a balance? We need to have the right inventory, the right moment and at the right quantity that one, we can see a huge impact on the cash flow. And that is all in supply chain, right, with inventory. And another one that also procurement can help. Is everything related to supplier relationships that from there there are many opportunities to create value. And we need to work with finance for that. So we made sure that the proposals are right and all what we are doing with inventory right and investments. So it's very helpful. We have a significant impact in that area.
[00:49:11] Host: Paul Barnhurst: Love it. And you know, kind of we're going to move into a fun section where we ask some personal questions of our guests. We'll leave a few minutes for Q&A, but just kind of ending with the reality is if we can align things properly, we can unlock value. Those opportunities are there. The better we work together as a team and learn each other's business and be good partners. You know, Now finance will be partners with supply chain and the reverse is true. We will accomplish more. I guarantee it, anyone who's been in a high functioning organization has seen it. So you know, that advice is make sure you're talking to your supply chain people and you're in finance. And if you're a supply chain, have those conversations. Learn the basics. Figure out how you can better support each other for the benefit of the organization as a whole. All right. Few fun questions, Lyndsey. We're going to start with you. As a child, what did you want to be when you were going to grow up?
[00:50:04] Guest1: Lyndsey Weber: Yeah. So when I was really young, it was definitely a vet. I love animals, we were just talking before the live stream started. So horses, dogs, all the animals. So really early it was a vet. And then I would say as I got older it was very confidently journalism actually. So I was very set on going and being a writer or a broadcaster. And then I realized I really liked calculus, which sounds super nerdy, and that's how I got into engineering and ultimately supply chain.
[00:50:33] Host: Paul Barnhurst: Oh, I thought maybe you'll learn there's an SAP class and decided I want to learn about ERP. I didn't even know what SAP was in college, so we went from that to journalist to math to now sales.
[00:50:46] Guest1: Lyndsey Weber: That's right. Yep. Love it.
[00:50:48] Host: Paul Barnhurst: Great journey. All right, Marcia, you get a different question. If you could have dinner with any person who's passed away in the history of the world, who would you take to dinner?
[00:51:01] Guest2: Marcia Williams: The person cannot be alive. In that case.
[00:51:04] Host: Paul Barnhurst: It can be dead or alive. Either one. Okay, we'll give you both.
[00:51:08] Guest2: Marcia Williams: Okay. Well, a person that I would really like to know more and just to feel like the energy. Tony Robbins. I love that. So that would be great. I like how he approaches, like, problems to turn them into opportunities. I think it's super helpful.
[00:51:34] Host: Paul Barnhurst: All right. So we got Tony Robbins. Love it. And anyone who's listening, feel free to throw in the comments who you're going to take or what you are going to be as a child. When I was younger, I wanted to be John Stockton, but I wasn't good at basketball. I thought I wanted to be a statistician more from a sports side, and I took a statistics class and realized that that ain't my career. Now I talk to people all day, so go figure. All right. We'll ask both of you. This one. Lyndsey, what's your favorite Excel function?
[00:52:02] Guest1: Lyndsey Weber: We've had this conversation. I feel like I know.
[00:52:05] Host: Paul Barnhurst: That's what I'm going to put you on the spot and see if it changed. I'm going to go back.
[00:52:08] Guest1: Lyndsey Weber: I am a classic. I would say index match or index match, probably just because I feel like that was one of the first combinations of functions I started using in some complex models early on, and it was just amazing, right? Once you finally learned how to do it, it felt like you were cracking a secret code. Way cooler, in my opinion, than having to nest a bunch of like Vlookups or B, you know, H lookups, that sort of thing. So I'm probably classic. I'll go index match.
[00:52:37] Host: Paul Barnhurst: That's a pretty common one. Marcia, how about you? What's that function you like?
[00:52:42] Guest2: Marcia Williams: Okay, this one is really simple, but I like it because it's visual and attractive. I like conditional formatting. Right. To see the green. Yellow. I don't like red, but at least I am aware. So yeah, I like it.
[00:53:01] Host: Paul Barnhurst: Like, red is a normal, normal course of action, at least on conditional formatting because it usually is not a good thing.
[00:53:08] Host: Paul Barnhurst: I like it. Conditional formatting. That's that. That is a good one. All right. We're going to ask both of you this next one. We'll start with you Marcia. What's your favorite thing to do outside of work? What's a non-work hobby or passion like writing. You like to write? Nice. You get to do a lot of it on LinkedIn.
[00:53:28] Guest2: Marcia Williams: I love doing that. I always like it. So.
[00:53:33] Host: Paul Barnhurst: Well, great. And Lyndsey, you I know animals is one but what you can share that one or another one.
[00:53:39] Guest1: Lyndsey Weber: Yeah. Let's see. Tennis and boxing are currently two big things. So my husband and I were in a boxing gym which is really fun. So that's a good stress relief. But yeah, we like to be outside and do active things and take the dog for walks.
[00:53:52] Host: Paul Barnhurst: So nice. So tennis and boxing. So did you watch Mike Tyson? Yeah.
[00:53:57] Guest1: Lyndsey Weber: No. You were like the fourth person to ask me. I feel like, you know, that's the wrong answer for me saying I like to box, but yeah, only the highlights.
[00:54:04] Host: Paul Barnhurst: I just had to, I had to bring it up because. Right. That's all anyone's talked about lately with boxing is like, all right, well we're going to go ahead and wrap up here. We'll hang on for a minute or two to see if any questions come through, and if not, we'll go ahead and close the stream. But thank you so much for joining us, Lyndsey. Marcia, it was a fabulous conversation, especially thank you to the audience. Without all of you, this wouldn't be possible. And you know, if you want to share this with somebody, let them know they can see it on YouTube. It was streamed live there. The recording will be there, it will be on LinkedIn, and it will also be released as a podcast in a few weeks. So you're welcome to check out anything you want to relisten to or kind of catch some of the highlights as we release that. So thanks again for joining us, and we'll hang on for a minute or two for any questions. And then we'll go ahead and end the stream. There is a possibility we may not get anything from Lincoln. Usually I get a few comments and it's been about 20 minutes, so I'm wondering if there might be a little bit of a connection issue, but we'll give it a minute or two. Not that that ever happens with LinkedIn.
[00:55:05] Guest1: Lyndsey Weber: Certainly not.
[00:55:07] Host: Paul Barnhurst: Or software. Right. It's just like numbers. They always. Yeah.
[00:55:10] Guest1: Lyndsey Weber: Never never never.
[00:55:11] Host: Paul Barnhurst: All right. We'll give another 30s. If nothing comes in, we'll call it. And then I'll go check LinkedIn and see how many came in. All right. We got a thing. So somebody's hearing us. Good. Thanks, Mark. Thank you. Mark. All right. Well, I think we'll go ahead and wrap up at this point. But thank you everybody for joining. It was a real pleasure. Always fun to host. So everybody have a great rest of the day wherever you be. Morning evening afternoon. Thanks for listening to FP&A tomorrow. If you enjoyed the show, please leave us a five star rating and a review on your podcast platform of choice. This allows us to continue to bring you great guests from around the globe. As a reminder, you can earn CPE credit by going to earmarkcpe.com, downloading the app, taking a short quiz, and getting your CPE certificate to earn continuing education credits for the FPAC certification. Take the quiz on earmark and contact me the show host for further details.