However, bringing together all process stakeholders is essential to addressing any remaining discrepancies and aligning the organisation on a set of financial and operational forecasts. For example, a commercial decision to shift promotion from one brand to another may have positive benefits on revenue and margin but may create negative consequences for inventory or operating expense. Input into the constrained demand plan. It has been around for more than two decades in a formal sense. In this way, IBP enables the Finance function to deliver an enhanced and proactive business partner role and in doing so, ensure that key decisions are made in line with corporate objectives and metrics and are therefore optimised at enterprise level. IBP supports increased transparency in two ways that enable the finance function to more rapidly and efficiently create reliable, integrated financial plans based on sound analysis; Firstly, the regular IBP process reviews both volume and value forecasts with value figures being derived directly from volume forecasts. The outcomes of these IBP discussions are also visible at the various aggregate levels so that emerging views on the business outlook are continuously visible and explored up to global level in the finance function without the need for a compressed planning period. These initial forecasts should take around one week to produce and will form the basis of the initial conversation and meeting with the operations team. The sales and marketing team will have created a first draft of what is called an unconstrained consensus demand plan. The answer is two-fold. For the finance team, this meeting is about working with the supply planning team to fully understand how supply constraints will affect the overall demand and revenue plans. The criticality of cross-functional collaboration in S&OP/IBP is also often overlooked. 3. Reed discusses the structure and approach that finance plays through the different IBP processes, in order to reach success and drive better results across all areas of the business. Josh Peacher is a manager at The Hackett Group. The sales and marketing team will have considered key variables such as statistical unit forecasts, promotional plans, customer plans and forecasts, seasonality, new product introductions and competitive activity to generate a unit and revenue forecast. The cross-functional forums of IBP raises the level of discussion of these cases to an enterprise level. The unconstrained demand planning meeting is followed by a constrained demand planning meeting. Following this meeting, the aligned set of financial and operational forecasts will be presented at the second and final reconciliation meeting of the planning cycle. Our research found that companies reporting the largest gains in revenue, margins, inventory turns and customer satisfaction have a monthly review process that incorporates the finance organisation and combines sales and operations plans with financial forecasts. Firstly, an effective IBP process can drive substantial financial benefits for an organisation, including increased revenue, reduced COGS, and lower overall inventory levels. This allows the Finance function in particular to work closely with functional leaders to develop early awareness and build consensus on expected business scenarios and then facilitate enterprise responses to those as part of the evolving IBP process. The IBP process aligns the commercial and supply chain plans on an ongoing basis with volume forecasts (and the underlying business assumptions) being shared across the functions as part of the rolling monthly planning process used in IBP.