The cost of inaccuracy: How faulty finance data is impacting the telecom sector

The telecom sector is complex, with multiple revenue streams and service offerings, and it relies on innovation to remain profitable. Whether it’s expanding your fiber-to-the-home wireline footprint, upgrading cell networks to 5G wireless, or replacing legacy networks with cloud-native ones, proactivity and speed are essential for effective financial planning.

In this volatile environment, the ability to build effective business models and refine financial strategies in response to market and consumer shifts is crucial to staying competitive. However, for many finance leaders in this sector, achieving this remains elusive.

A survey conducted in partnership with Wakefield Research reveals that confidence in accurate planning, budgeting, and forecasting among U.S. finance leaders in the telecom sector is alarmingly low. The research identifies data accuracy and visibility as core issues that telecom finance leaders must address to protect both their business and their professional credibility from negative consequences.

Accurate data is elusive

95% of finance leaders in the telecom sector report lacking confidence in the accuracy of their forecasts.

This uncertainty stems from the impact of data silos, with 78% of finance leaders identifying these silos as a major obstacle to generating organization-wide insights. The isolation of data within departments obstructs a holistic view of the company’s financial health and impairs strategic decision-making.

Additional issues affecting forecast accuracy include problems with data quality, timeliness of data delivery, and the relevancy of data for decision-making. In fact, 98% of respondents acknowledge that their forecasts are outdated by the time they reach stakeholders, and only 10% of respondents can forecast in real time.

While AI holds potential to improve financial planning in the telecom sector, 98% of respondents recognize the need to enhance their data infrastructure and analytics capabilities to fully leverage AI.

Without up-to-date and reliable forecasts, telecom finance leaders struggle to advise on strategic decisions related to market fluctuations, R&D investment decisions, and workforce planning. This can lead to inefficient capital usage, missed revenue opportunities, and strategic mistakes.

Telecom finance leaders are doing more than ever

97% of respondents have taken on responsibilities beyond their traditional scope.

The role of finance leaders in the telecom sector has expanded significantly over the past five years to include hiring decisions, workforce optimization, customer experience strategy, and company-wide innovation.

In addition to these new responsibilities, finance managers must ensure that team members are equipped with the necessary skills to keep up with digital transformation. The shift to a data-driven culture enhances financial reporting accuracy and speed. For finance leaders, the ability to contribute effectively to strategic planning can be make-or-break.

It’s time for action

98% of respondents have witnessed a negative impact on business performance due to inaccurate forecasting.

The repercussions of inaccurate forecasting are profound and far-reaching. Inefficiencies and misallocated resources reduce overall productivity, hampering the organization’s ability to operate smoothly.

Inaccurate forecasts can lead to missed opportunities and negatively impact shareholders. Poor forecasting also affects workforce planning, leading to either overstaffing or understaffing, both of which can be costly.

In addition to these business consequences, our data shows inaccurate forecasting has personal repercussions for finance leaders. Increased workloads, damage to professional credibility, and hindered career advancement opportunities are some of the impacts experienced by finance leaders.

Connected Planning: A way forward

As the telecom industry continues to evolve, the importance of robust financial planning will only increase. Rapid change and fierce competition make digital transformation not just beneficial but essential for long-term success.

Connected planning platforms like Anaplan offer a transformative approach to financial planning, ensuring alignment with corporate strategy. With these solutions, you can:

• Conduct scenario modelling and analysis to establish the best path forward amidst market uncertainties.
• Optimize opportunities with intelligent forecasting to stay ahead of trends and capitalize on emerging opportunities.
• Implement up-to-the-minute reporting, providing stakeholders with accurate information needed to make strategic decisions with confidence.

Connected Planning enables you to optimize costs and achieve your performance targets, ultimately driving business growth and success in this dynamic industry.

For more information on how Anaplan can support connected planning in the telecom sector, visit: https://www.anaplan.com/industries/telecom/