The Future of FP&A and How the Association For Finance Professionals (AFP) is Leading the Way with Pat and Bryan

In this episode of FP&A Tomorrow, host Paul Barnhurst welcomes Patrick Culkin, the new President and CEO of AFP. Pat shares his thoughts on leadership, professional development, and the evolving role of finance as AFP looks to expand its global reach and support a changing profession. Later in the episode, Paul gives a walk-through of his scenario planning framework using Gen AI, followed by a conversation with Bryan Lapidus about the return of the FP&A Forum, the state of the profession, and what financial professionals need most right now.

Patrick Culkin is the President & CEO of the Association for Financial Professionals (AFP), stepping into the role in July 2025 after more than two decades with the organization. He previously served as Executive Vice President and began his AFP journey in Human Resources. Bryan Lapidus, FPAC, is Director of the FP&A Practice at AFP, where he leads thought leadership, education, and community-building for financial planning professionals. With a background in corporate finance and consulting, Bryan is also a certified FPAC holder. 

Expect to Learn:

• What drives AFP’s mission and how its leadership is preparing for the future of finance.

• How finance professionals can navigate uncertainty, AI adoption, and rapid change.

• Why growing a strong professional network is key to career and organizational success.

• A practical framework for scenario planning and how Gen AI can support it.

• What to expect from the FP&A Forum and why it’s become a must-attend event for finance professionals.

Here are a few quotes from the episode:

• “Everything we do at AFP has to drive the success of the corporate finance professional. That’s our North Star.” - Patrick Culkin

• “Technology is a tool; what really matters is how you use it to drive better business outcomes.” - Bryan Lapidus

• “Everyone in the company plans, but FP&A is about return on capital; that’s what sets us apart.” - Bryan Lapidus

Patrick Culkin shared a clear and practical outlook on the future of corporate finance. He highlighted the importance of staying connected, continuing to learn, and being ready to adapt as the profession evolves. Together with insights from Bryan Lapidus and Paul Barnhurst, this episode underscores the growing role of finance as a strategic partner in business.

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AFP FP&A Forum: All insights. Zero spin.

March 23 – 25 in Indianapolis
This immersive, three-day event is built for financial professionals, by financial professionals, and it’s designed to help you sharpen your skills, stay on top of trends, and connect with peers who understand your challenges.

Learn more: https://www.financialprofessionals.org/events/meetings/afp-fp-a-forum

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LinkedIn - https://www.linkedin.com/in/patrick-culkin-5981032/
Website - https://www.financialprofessionals.org/

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LinkedIn - https://www.linkedin.com/in/bryan-lapidus-fpac/
Website - https://www.financialprofessionals.org/

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Earn Your CPE Credit
For CPE credit, please go to earmarkcpe.com, listen to the episode, download the app, answer a few questions, and earn your CPE certification. To earn education credits for the FP&A Certificate, take the quiz on Earmark and contact Paul Barnhurst for further details.

In Today’s Episode

[01:33] - Pat Culkin Introduction

[06:30] - Global growth and networks

[11:09] - Changing role of finance

[13:07] - Challenge for Corporate Finance

[16:03] - Opportunities in uncertainty

[21:05] - Why Join AFP or Pursue the FPAC

[26:54] - Scenario planning framework

[41:03] - Bryan Lapidus on the Forum

[47:27] - FP&A Forum: What to Expect

[53:43] - Wrap-up and closing thoughts

Full Show Transcript

[00:01:04] Host: Paul Barnhurst: Hello everyone. Welcome to FP&A Tomorrow, where we delve into the world of financial planning and analysis, examining its current state and future prospects. I'm your host, Paul Barnhurst, aka the FP&A Guy, and I'll be guiding you through the evolving landscape of FP&A. This week we have a special episode for you. I'm thrilled to bring you a couple interviews that I did. The first interview is from Pat Culkin. Pat is the new CEO of AFP. He took over earlier this summer. I interviewed him in April before he took the job, and he shared some of his thoughts. So we'll start by sharing that and then we'll be followed by me sharing a little bit of the presentation I was supposed to give at the FP&A forum in March of this year, but was unable to due to some last minute issues that came up. But I did also have the pleasure which will be sharing of interviewing Brian Lepidus, who talks about the event and also just talks about fans in general. We had a great conversation. So we're going to go ahead and roll the clip, and then I'll come back, share a little bit about the presentation I was supposed to give. And then we'll roll the Brian clip. So I'll see you here in a minute. Thank you. Alrighty. Welcome everybody I have with me today. Pat Culkin. Pat has been with AFP for about 25 years. He's taking over as the new CEO here shortly. In about two months, Jim will be leaving and so really excited to have you on the show. Appreciate you carving out a few minutes for us.

[00:02:36] Guest 1: Patrick Culkin: I appreciate you having me. Paul. This is wonderful to be here today. I'm looking forward to our conversation.

[00:02:41] Host: Paul Barnhurst: Same here. I'd love to start with. You've spent the last 25 years at AFP most of your career. What's motivated you to to stay AFP a long time that feels like forever in today's world.

[00:02:52] Guest 1: Patrick Culkin: I'll start with a little bit of a confession. In the beginning, I had no anticipation that I would be here for as long as I have been. You know, it's interesting when I think back about my career path with AFP, and I think about why I've been here as long as I have. There's a couple of things that came out of it. One, when I started working with the organization, there's a couple pieces I really enjoyed. Jim Cates, I think, is a fabulous leader over the years. He's turned into a mentor and a coach for me in a number of different ways. So I've always appreciated my time being able to work with Jim specifically, but more broadly, a big piece of what kept me around was the culture at AFP. You know, internally. And I won't get too much into the details of the internal, but there's a piece that I think is important here. The internal culture for the organization was always focused on continuous learning development, how the organization can help to drive, you know, the staff forward and push them out of their comfort zone in order to be able to drive to a better outcome or a better result for AfP as an organization.

[00:03:52] Guest 1: Patrick Culkin: And what I found was that really appealed to me. It really caught an interest in me that maybe at that point, my career, I didn't necessarily realize that I had, that. I really enjoyed working with an organization and working in a position where I was trying to help every way possible to help drive the development of our own internal team. As I may not know, I started in more of an HR capacity, and over time, what I realized is that that's exactly what AFP does for the practitioner market that we serve. Afp is an organization. It's a mission driven organization focused on how we can help practitioners to be successful in their roles, and how we can help them to be successful in their careers. And I took a lot of what appealed to me about the culture of AFP internally when I started to realize how much of that's the purpose of AFP as an organization. It really sparked a passion in me that, quite frankly, in my early part of my career, I probably wouldn't have identified that I had.

[00:04:49] Host: Paul Barnhurst: Well that's exciting. I appreciate you sharing that. Sounds like you guys have had real focus not only on developing finance professionals, but developing people within the organization?

[00:05:01] Guest 1: Patrick Culkin: Absolutely. You know, the way we internally, our organizational culture has always been, again, kind of going back to that theme of continuous learning, how we can help the people within the organization forward, and then in turn, they can help drive the organization forward. That culture has been something that I'm proud to have been part of. It's actually something I very much acknowledge that I've taken some benefit from. We've tackled some interesting challenges over the last 25 years. I mean, if you think back, there have been a number of interesting in some ways, good, interesting in some ways not so good, interesting events that have happened around the world that have had an impact on the organization. We've had to be able to step up and meet those challenges, and seeing how the development and the work and the effort in really finding the right people with the right profile and then working to develop and grow those people to be able to meet those challenges. It's incredibly satisfying. And, you know, it's something I'm very proud of. When I look back at, you know, what role I played, not only directly, but more in an indirect way, by working with or bringing in or recruiting some of the people that have been such major contributors to AFP and AFP. Success. It's very gratifying, and it's been one of the things that has appealed to me and continues to appeal to me. And, you know, frankly, where we are today or where I am today. I'm dying to see where this ends up. I'm dying to see what we can get to as a result of all this work.

[00:06:27] Host: Paul Barnhurst: Yeah. So I'd love to get your thoughts on that. You mentioned dying. What has you so excited about the future or where do you think you guys are going as you look forward and look at the future of AFP?

[00:06:38] Guest 1: Patrick Culkin: I think there's quite a bit that we can do. As you probably know, I mean, you've been affiliated with AFP, you've been part of the organization in many ways from your involvement within the organization. And you've probably seen we've expanded quite a bit globally, you know, in the last 15 years. Not only did we launch the Fpac certification, we also launched our efforts across the broader Asia Pacific region. We're now working quite a bit in the broader Middle Eastern and African regions. So there's a massive opportunity for us to be able to serve our profession on a more global basis. And I think that that's an important thing to me. It's something that I see as really exciting as a way to be able to build and grow our professional network more effectively. I also see opportunity in terms of that mission piece. So I talk a lot about mission and you know, why we exist as an organization. Because I look at it as a focal point. It's somewhat of our North Star, right. So everything that we do has to be in an effort to be able to drive towards the success of the corporate finance profession, it's why we exist as an organization. I believe we do that very well. I believe that the way we can improve upon that is by continuing to expand that network. One of the things that I see as a strength of AFP's is the fact that when you build a network, and I suspect that in your line of work, Paul, you probably see some of this also.

[00:08:04] Guest 1: Patrick Culkin: You build a network. You have the ability to not only leverage what that network can provide for you, but it gives you the ability to get better at what you do in order to be able to provide back to that network. But it's a nice circular effect that I think drives a lot of value. So the way I look at how we can continue to be better and how we can continue to to serve that mission in not only a more effective manner, but in a more relevant manner in such a changing environment, is to continually focus on growing that network of practitioners that that we work with, growing our, you know, our membership, our attendees to our events, the number of certified practitioners that we have as a with our Fpac, as well as our CTP certification. Building that network gives us a broader pool for us to be able to continue to improve on how we can meet the challenges that the practitioner market is facing, and then provide the products and services and the content for the practitioner in order to be better at their job. So it's kind of like that. I see it as a relationship in a lot of ways. Um, and I think that that's a significant opportunity for AFP as we move forward.

[00:09:12] Host: Paul Barnhurst: It feels like there's that kind of significant growth internationally. And, you know, also in the US continuing to provide more content. You know, so basically continuing to do what you're doing, but on a bigger scale and involving more people, I.

[00:09:27] Guest 1: Patrick Culkin: I think involving more people is the key there. What we provide, the vehicles by which we use to provide content, whether it be webinars, seminars, um, you know, information that we provide through our AFP learn product, those can evolve, right? Those are going to change as the profession evolves, as different technology platforms come about. I think that if I think about what is the most important thing for AFP in order to be able to do those things, it's that continuous growth of the broader AFP network, the broader AFP community. I think that that is one of ours. I see it as one of our advantages as an organization, you know, as the professional society that represents corporate finance. I think that that network is a clear strength of ours. I think continuing to build that strength and, you know, continuing to acknowledge the fact that there's not one person out there. And I'm sure you recognize this in your line of work poorly. There's not one person out there or one organization that can say definitively, this is how it has to be moving forward in order to be successful. It's constantly learning, it's constantly evolving. And that takes a little bit of acknowledging the fact that we don't know everything. I don't know everything, you know. We don't know everything. So I think that, you know, by acknowledging that and focusing on how you, you know, what is the best pathway in order to be able to gather information, process that information, analyze that information, and leverage the lessons that others have learned. That is a key component of our strength. As we as we think about how we can continue to provide back.

[00:11:08] Host: Paul Barnhurst: Makes a lot of sense to me. I'm curious, are there thoughts to expand beyond the treasury and FP&A within corporate finance? Is there, you know, CFO or strategic finance or some of these other, you know, things, or did you feel like you know, where you're focused will continue to be for the time being or any thoughts there?

[00:11:29] Guest 1: Patrick Culkin: Yeah. So that's a really interesting question. And it's one that I'm going to acknowledge can potentially get me in trouble because I'm always one that's looking for what is the next thing that we can be doing. I think in the medium term, I think it's reasonable to expect that our focus will continue to be primarily on Treasury and corporate FP&A. I think that where it's going to get interesting as we move into the future is going to be kind of how the positions, the functions within the office of the CFO, how they continue to evolve and whether or not they can. You know, what we're hearing and seeing in some ways is they're becoming a little bit more integrated. And does that integration lead to some evolution? How the profession evolves, which I would say with 100% certainty. We have to consider whether or not we need to evolve with it. There was a quote that Jim Cates used to have on the wall in his office, and I, I fail to recall exactly who the quote was from or what it was from, but it was something to the effect of the rate of change on the outside exceeds the rate of change in the inside. The end is near. And this is one of those areas where I think I would look at that from that type of perspective, you know, depending on what the evolution of the profession starts to look like, that would dictate strategically where AFP would move in order to serve the profession.

[00:12:48] Host: Paul Barnhurst: Sure, it makes a lot of sense. And, you know, as things continue to change, you always have to be evaluating and looking to say, how do we change to best serve our customer?

[00:12:56] Guest 1: Patrick Culkin: I think if we try to stay static, that's a recipe for disaster over the long haul. I think it's always having an open mind and keeping your eye on what's happening out there and learning from the market to see how we can best serve the profession.

[00:13:09] Host: Paul Barnhurst: I agree, and that makes a lot of sense. I'm curious, what do you see as maybe the biggest challenge moving forward for, you know, the corporate finance professional?

[00:13:18] Guest 1: Patrick Culkin: There are multiple challenges. I think there's a couple of big ones that I think we should acknowledge in the time that we have available today. You know, one being technology and AI in particular. I think that the rate at which AI is, is being adopted within organizations, within individuals, even in personal lives. I think about how I've used AI. How my kids are using AI. And quite frankly, they're much better at it than I am. And I think that that's a sign of things to come. And I think that how individuals and, and the profession and organizations as a whole really start to, to leverage the power of AI and what it can do. I think that, you know, it presents a set of challenges. I mean, it certainly presents a set of opportunities, but it presents a set of challenges that I think that finance professionals as a whole need to be cognizant of. They need to know that this is something that is going to be changing and changing at an incredibly rapid rate for many years to come. I wish I had the ability to predict where this is all going to land, so we could map that course out with some level of precision. But I recognize the fact that, you know, this is a moving target for us. And, you know, if you figure it out, Paul, you got to let me know, because this is one of those areas.

[00:14:34] Host: Paul Barnhurst: I think it's a moving target for all of us when it comes to AI and what it will look like and what it all means. I mean, we all have a general idea and we see things you can kind of, you know, you can see some things down the road, but just how quick it's moving and trying to, it's getting harder and harder to try to forecast it as technology seems like it's moving quicker and quicker.

[00:14:55] Guest 1: Patrick Culkin: So speaking of forecasting, I mean, this is another area that I see is a significant challenge. And you know, I don't want to get too much into this, but I think we need to recognize the fact that there is a significant amount of uncertainty in our current world. And I think that that level of uncertainty makes it very difficult for those in our profession. It makes it difficult for corporate finance professionals to really be able to, to forecast to, to, to budget, to think about, you know, whether or not the, the models that they've built are appropriate as they look into the future, whether or not the data they're looking at is the is the right data to be able to make the strategic decisions for their organizations. And I think that that's another area where it's a little bit of a challenge. I think it's going to be a challenge for some time moving forward. And I think that acknowledging that and recognizing that and, and again, kind of leaning on, you know, the network that we're able to build and the, the, the, the content and the knowledge base that exists out there within the profession will only help people to be able to feel more comfortable in those these challenging times.

[00:16:03] Host: Paul Barnhurst: Makes a lot of sense. And yeah, definitely some real challenges around forecasting right now with just all the uncertainty and volatility globally.

[00:16:12] Guest 1: Patrick Culkin: Absolutely.

[00:16:13] Host: Paul Barnhurst: What about if we flip that around. What do you see as kind of the biggest opportunity going forward?

[00:16:18] Guest 1: Patrick Culkin: So with every challenge is an opportunity right. True. At a high level the challenges that we just laid out, I do believe that those create significant opportunities for the finance profession. I think that some of that will be the ability to be able to take advantage of those opportunities is going to be based on a few areas. One, I think there's that acknowledgement of the acknowledgment that we need to evolve and grow and develop and learn. I think that individuals have to look at this and kind of look at the situations that we're in at the moment and really establish whether or not the old way of doing things is going to work. How do we look at things a little bit differently given the challenges that we face? I think as we become more proficient in that and more proficient in, in, in working within these uncertain times and dealing with these, this constant change in technology, I think that provides a significant opportunity for finance to really be able to leverage the power that they have to be more effective business partners with their with the business units within the organizations that they work within companies, you know, business units within companies. They're going to be leaning on finance to have a more effective leaning on finance, to really be able to understand what they can be doing to be successful in this time of uncertainty and finance. This is an opportunity for finance to step up and finance to really show what value they can provide. And it only does if successful. That only enhances the credibility of the finance function and enhances the credibility of the profession and enhances the companies the value that organizations will place on finance as they build their longer term strategic plans. And I, I believe that finance has a massive opportunity to capitalize on the challenge, to be able to drive some forward progress within their organizations. I think it's going to be difficult, but I think it's an opportunity.

[00:26:54] Host: Paul Barnhurst:  FP&A guy here today, I want to talk about the certified corporate FP&A professional, or the FPAC, from the Association for Financial Professionals. I am often asked what makes the FPAC unique. And I respond by saying it's the only FP&A program that is a credential versus a training program with a certificate. Three key differences include: The FPAC requires work experience to enrol in the program two. The FPAC exam is closed-book and administered at a testing centre. Three to keep your credential current, you have to do continuing education hours. I went through the program a few years ago, and it was a great learning experience. Not only did I learn a lot studying for the exam, but I am grateful for my membership in AFP for the networking opportunities and the opportunity I have to continue to learn through events and resources provided by AFP. If you're serious about building your career in FP&A and want an FP&A credential, I recommend looking into the FPAC program. Head on over to my website to learn more. And if you sign up for the program, don't forget to use my code to receive a discount. Those codes are the TheFPAGuy-FPAC – Exam $150 discount, and TheFPAGuy-FPACEPP – Exam prep platform $100 discount. Again, head on over to my website for those codes and to learn more.

 
I would agree. I mean, I think the more uncertainty, more volatility, more change you have going on, the more opportunity there is for finance because you're trying to figure out what that means. And at the end of the day, everybody wants to know what that means for cash. What that means for revenue, for profit, for, you know, the way they're going to be viewed externally. And those things fall heavily on how finance thinks about them and helps drive the right decisions to make sure you remain in a healthy position or as healthy as you can be for the environment, right?

[00:20:21] Guest 1: Patrick Culkin: They have to be able to manage risk. They have to be able to, you know, strike the balance between, you know, understand their own organizational risk profile. And how do you strike the balance between taking advantage of opportunities that may exist in the broader market by investing versus looking at their, their, their own internal financial position or cash position, determining what is reasonable to invest. It would be an interesting time, and I think that I see it as as something that could be very powerful for finance.

[00:20:52] Host: Paul Barnhurst: I agree with you. It is an exciting time, lots of opportunity when done right. And so, you know, kind of I want to ask you just one last question. I'll let you go. I know we've, uh, used up most of our time, you know, what would you tell the FP&A professional and most people who listen to this podcast, or for professionals, if they were considering joining AFP or maybe even taking the f pack, just, you know, what would you tell them?

[00:21:17] Guest 1: Patrick Culkin: So I would tell them, there's a couple things that I tell them, and I'll spare you my sales pitch, I will I will spare you the sales pitch, I think that, you know, one, I would certainly talk through AFP's broader product and service offering. I would talk about our, you know, the fake certification, the benefits of the certification. We talk about our events, specifically our annual conference and the fan forum, which I know that you were part of this year. Um, you know, we talk about our content, our value proposition, all the things that we believe are valuable to the profession. But I think that and this might sound a little bit repetitive, but I do think it's important to share. I think that the one of the most important points that I would try to make, which I think is probably a little bit, um, different from the typical why you should be part of a sales pitch. Um, I want to reference back to what I talked about, you know, AFP's opportunity and the growth and the building and the growth of our community and our network. Um, I truly believe that individuals that become part of our network, part of our community, whether it be through the certification or events or, you know, our membership. I truly believe that that strengthens AFP and it helps us to be more effective. As I talked about in How we serve the profession, and I would talk to if an individual asked me, why should I be part of AFP? Why should I be part of this organization? I could talk about all the things that we do that benefit them as an individual, but I'd probably spend a fair amount of time talking to them about individuals within the profession who will see they see the value in the profession and what they do.

[00:22:55] Guest 1: Patrick Culkin: They see, you know, there's a reason why they've chosen the profession that they've chosen. I'd ask them to be part of the organization, part of the community, to help us to serve that profession more effectively. I think it's maybe a little bit Pollyanna, but I do believe that there is something to give back and being part of the solution to help drive the effectiveness of the profession and in turn help others in the profession to be successful. Help to share. Share with early career professionals you know what opportunities actually exist within. Finance as a whole. And you know, I think that there may be, you know, those coming out of school might not know everything about what is out there. And I think that there's ample opportunity for AFP with the help of those that are part of the community, to help us to be able to convey, you know, the content, the learnings, the the information that is going to be necessary, but also, you know, help people see what the opportunities are so they can forge a career path that maybe they wouldn't have seen otherwise. I think that's a valuable addition to that.

[00:24:03] Host: Paul Barnhurst: And it makes a lot of sense, a lot you can learn and some value you can add by learning from others, right? Learning from the community and the network and people have gone through it. There's a lot of things that we don't have to experience ourselves to learn whether it's a good or bad idea. We can learn from others.

[00:24:19] Guest 1: Patrick Culkin: Paul sounds like I should be recruiting you to be a member soon.

[00:24:22] Host: Paul Barnhurst: I am a member.

[00:24:23] Guest 1: Patrick Culkin: Oh. Even better.

[00:24:25] Host: Paul Barnhurst: I think I'm on my fourth straight year, so there you go. I even have my f pack as well.

[00:24:29] Guest 1: Patrick Culkin: I did know that. That's wonderful.

[00:24:31] Host: Paul Barnhurst: So thank you for being.

[00:24:32] Guest 1: Patrick Culkin: I do need to get my.

[00:24:33] Host: Paul Barnhurst: Continuing education hours done.

[00:24:34] Guest 1: Patrick Culkin: But you know, I know I know a place where you can get some of those continuing education credits. You should call me.

[00:24:40] Host: Paul Barnhurst: I figured just the podcasts counted. Well, Pat, you know, thank you so much for carving out a few minutes and chatting. I really appreciate it. And, you know, good luck as you step into the CEO role of leading AFP forward, excited to continue to see the growth and change as finance in the world continues to grow and change.

[00:25:02] Guest 1: Patrick Culkin: Thank you so much for having me, Paul. It's been great talking to you. I'm looking forward to chatting again soon.

[00:25:07] Host: Paul Barnhurst: Thanks, Pat.

[00:25:08] Guest 1: Patrick Culkin: Alrighty. Bye bye.

[00:25:10] Host: Paul Barnhurst:And now a brief message from our sponsor, AFP. You know as well as I do, the world of finance is moving fast, and if you want to stay ahead, you need real insights. That’s exactly what you’ll find at the Association for Financial Professionals’ FP&A Forum, an immersive, three-day event built for financial professionals, by financial professionals. Last year, 96% of attendees joined to sharpen their FP&A processes, strategies, and stay on top of emerging trends. And this year, it’s even bigger. Experience unbiased, sales-free educational sessions, collaborate in 10 dynamic roundtables, test out the latest FP&A tools, and hear from powerful keynote speakers, tackling real-world challenges head-on. Plus, you’ll be networking with more than 500 of your peers, all in Indianapolis, March 23 through 25. So if you want high-impact insights without the spin, this is the place. Learn more at financialprofessionals.org.

 
[00:26:54] Host: Paul Barnhurst: Welcome back. I hope you enjoyed that interview with Pat. I want to take a minute and share a little bit of what I was going to present at AFP. Then we will jump into the Brian Lapidus interview. I'm really excited for you to get to hear me chat with him. He's one of the brightest and smartest people in FP&A that's helping guide and move this profession forward. So my presentation was called AMP Up Your Scenario Planning with Gen AI. And let me just tell you a little bit about it.

[00:26:54] Host: Paul Barnhurst: So we're going to run through a few things I'm not going to do. The introduction of me. What we are to cover in this presentation was Best Practices for Planning the Future, a framework for Scenario planning. And that's what I want to go through, it just takes a few minutes, go through that framework, how to implement it. And I'll talk briefly about the use case. I'm not going to do the full presentation. It was an hour long presentation, but I thought it would be fun to highlight some of the things and you would enjoy that for this episode. So let's go ahead and run through that. So first I want to share this quote from Michael Porter. I really love this scenario planning. Far from being sterile or academic, exercise is a way of making assumptions about the future in a rigorous and structured way. Often we don't do it in a rigorous and structured way. It is a disciplined method for imagining possible futures and working out what strategic responses would be across a robust range of futures. And so the second part I love is what a strategic response would be. As always, Michael Porter ties it back to strategy. Sometimes we confuse scenario planning with sensitivities. Scenarios are situations where you're making assumptions about the future, and you may switch to a scenario based on what's going on. You'll make different choices and implement different scenarios, so I really like that definition.

[00:28:17] Host: Paul Barnhurst: Next, if you get the chance, there's a shell scenario planning video on YouTube. I highly recommend checking out. We're not going to watch it here, but it does a really great job. And then I talk a little bit about why we do scenario planning. You know there's risk management, identifying opportunities, improving your forecast, enhancing your decision making. The reality is point estimates are not enough. Even if you submit a point estimate for your budget, you should still have a range and an understanding of what the different scenarios and possibilities are, and how different external factors could change how you should behave. All right, so here is a slide. Just talking about some of the best practices for projecting future financials. You know not just scenarios but in general remember projections are not a finance exercise. Involve the business. I've seen it where the whole budget is done by finance. And then the business is like, I don't recognize these numbers. I didn't sign up for these numbers. You know, use trend analysis and extrapolation, but don't just take the historics and run it out and put a cost increase. Do more. You have to strike a balance between that bottom up and top down. Most companies, it's a combination of both. If you're a relatively new company, you may have much more top down.

[00:29:36] Host: Paul Barnhurst: You don't have much data. If you're very mature, maybe you do more bottoms up. It's going to vary, but you do have to strike that balance. You need to go beyond the numbers and understand the operations, identify and test assumptions. This is huge. Don't just rely on assumptions given to you. I still remember a situation where one of our business partners had put an investment case before the CFO of the business, and they'd put a bunch of assumptions in there. And as soon as the CFO sat down with this person and walked through them, they realized the assumptions were completely unrealistic, and the business case didn't look near as good as it used to. It still had a positive ROI, but she used that as an example to say the importance of finance and business doing together and pressure testing assumptions, because it made a very different story. After she reviewed it, then what we saw before, you know, link your budgets and what you're doing to performance management to your KPIs and how you manage the business. Right. Your budget should be tied to your strategy and it should be tied to your operations. Then use scenarios and sensitivity analysis. All right. So there's internal and external scenarios. You have many different types of scenarios. You could do internal or things such as lease versus buy. Hey should I enter company A or should I enter company country B should I buy company A or buy company B? Those types of things, external scenarios could be a black swan, Covid, an energy crisis, war abroad, um, competitor actions.

[00:31:19] Host: Paul Barnhurst: What's going on in the economy? Are we in a recession? Are we in a bear or bull market at boom time? What do those things mean for my business? What's the regulatory environment? You know, different leaders can lead to very different regulatory environments. So that's a little bit of external and internal. Now I want to walk through the forecast framework. So the one we used here is the acronym forecast for the framework for Scenario Planning. Frame the possible scenarios. It's where it starts. You need to frame what those scenarios will be. Outline your variables and assumptions. It's really important that you list all of them and that people understand what your assumptions are. Run simulations and models. Then you run simulations on those different scenarios, evaluate your outcomes and the sensitivity around it. You know, Monte Carlo simulation, there's a lot of different things, especially with AI now and the tools they have in Excel, it's much easier to do a Monte Carlo simulation, adjust budget and allocations accordingly. So make the adjustments you need to to your budget based on those different scenarios that you've run in. The sensitivities set contingency planning I think is critical. So often we see a worst case, a base case and a best case.

[00:32:42] Host: Paul Barnhurst: And I've been guilty of this. If I went back into FP&A, I would do a much better job on scenario planning than I did historically. I think it's really important to set contingency plans and say, when would a new scenario happen? For example, the regulatory environment. Maybe you have an election coming and who's going to be the president or who's going to control Parliament? You know, it's going to be a very different regulatory environment. You should have a scenario for that, and you should be planning to know when do I implement that scenario? Then track your performance and respond accordingly. I'm just going to run through this quickly and share a few things on each of these. So, you know, framing possible scenarios. A great thing is you can use gen AI to help you develop scenarios and even key drivers to get some ideas. So that's where we brought Gen AI in here. In this case, I had used deep research like tools to help with this part. And I used, I think, deep sea ChatGPT some different tools, but you can use it to help frame possible scenarios, you know. In the example I used here was Tesla. And so I'm going to quickly walk through this. And if you're listening, I highly encourage you to watch this episode on video because I'm showing some of the slides.

[00:34:02] Host: Paul Barnhurst: So in the Tesla example I asked the LLM these type of questions. Analyze the 2024 Annual Report and provide a list of key risks and opportunities. Analyze the web and the Tesla website to come up with ideas for three financial scenarios for the 2025 budget year. Again, I used a deep research mode so it would search the entire web. And here's some of the scenarios it came up with. They were pretty good. There were a number of different ones it came up with. Key factors A baseline scenario. A pessimistic scenario. It also had an optimism which I'm not showing here. You need to review all that, but it can help you get started again if you don't know the business well. It could give you some ideas. Even if you do, it may jog your memory. It's not going to do the work for you, but it could help get you started. There's a little bit on how we used it for one. Step two outlines variables and assumptions. Um, here we could use an AI to help you develop a list of potential variables and ask GI to challenge your assumptions and provide alternatives. Ai is great at challenging our assumptions. Again, I will show a Tesla example here. I'm going to keep going. You can see some of the key assumptions that used for a pessimistic baseline and an optimistic, you know, different ranges.

[00:35:26] Host: Paul Barnhurst: I asked AI to challenge the GDP assumptions and it told me why it could be wrong. It gave me contingencies. So this is helpful to give me ideas. Once again, the more you know your business, the more you know the environment, the less you may need this. But just showing what is possible. All right. Number three, run simulations and models. You know, where appropriate, use Monte Carlo. You could use AI to assist with code. You know, help you run your formulas for Python in Excel. I generally don't like having it do all my math. I think this is an area where you're going to build your models, but the tools that Excel uses are getting better. Some of them are making it pretty easy to do your Monte Carlo for you, so you could use it, but go ahead and run your simulations and models. And now we're going to go to number four. Then evaluate your outcomes and sensitivities. You know concrete. Create your comparison. Review your ranges. Look at your risks and opportunities. Review scenarios with subject matter experts. Don't just rely on AI or what you know. Talk to the experts because they're going to help bring in perspectives you haven't thought about. Number number four here on step four, I did some of this with Tesla. I asked it to review and provide thoughts versus actually doing it. So that's what I recommend on that step.

[00:36:52] Host: Paul Barnhurst: Let's go on to number five. Then you communicate your insights with the business. You have a call to action and recommendations. Again you could use AI Media to help review your presentation. I use it all the time for that type of thing. I help review my training, give me ideas, and play devil's advocate. So we have to communicate insights. Number six now is to adjust the budget accordingly. You adjust it based on analysis of your scenarios. Create buffers for those areas with greatest risk. Focus on your plausible scenarios, document changes and rationale behind those changes. And then number seven set a contingency plan. So list your scenarios. Here's what you should do: A contingency matrix. What triggers that action? So for example if there's all of a sudden no more EV credits is a scenario new government regulation would trigger that action. What's our response? How do we respond to that trigger? Well, in this case we'll do a price reduction. Who owns that action? Chief revenue officer or maybe it falls under You're the CFO or whoever you list who owns it. And then how will you monitor it? In this case? We'll monitor the regulations. We'll also monitor cells in the environment. And what I mean in the environment, the customer environment kind of how people are feeling about things. So that's number seven. And I show an example of Tesla here. Again you can kind of see how I struggled in some places where it was good.

[00:38:23] Host: Paul Barnhurst: It was good for general ideas. It struggled with specifics, but it could help you get started. Number eight track performance and respond. So here you want to determine your KPIs and triggers to track. You want to review your scenarios for those trigger points by your contingency planning, and respond based on your contingency planning. Where scenario planning is best is when you know when to implement new scenarios so that you can stay on top of things and continue to drive your business forward and not be reactive, but be proactive and then monitor the impact of response. And so that's the forecast framework. Again the F is to frame your possible scenarios. The O is to outline variables and assumptions R is to run simulations and models E is to evaluate outcomes and sensitivities C is to communicate insights to stakeholders A is to adjust budget and allocations accordingly. S sets contingency plans, T tracks performance and responds accordingly. Obviously here I've given you a very high level of my presentation. It was going to be an hour long presentation, but I wanted to share a little bit of that because I thought you'd find that interesting. Ai is getting more and more use cases. Don't be afraid to use it for your scenarios. Use deep research. Use tools that are in Excel to maybe help run a Monte Carlo, or do things that were very difficult to do before so that you have a better process.

[00:39:51] Host: Paul Barnhurst: You have a better framework for making sure scenarios are part of your budgeting process. All right. So that's what I wanted to share. Just a quick overview of my presentation. Hope you enjoyed that. Hope you watched that on video. But if you didn't, I hope you still got some value out of listening to me talk about it. So next we're going to do an interview. It's about 12 minutes long with Brian Lepidus. We talk about General FP&A and just how exciting it is to see Fpna continue to develop as a profession and become viewed as more and more important, more strategic and more needed by every company. He talks a little bit about the early days and how everybody had to figure it out. And then he talks about the conference. If you haven't had a chance to attend an AFP conference, I highly recommend it. Afp forum is great because it's focused on just FP&A. It happens in the spring. I highly recommend going. It's a great way to meet people, a great way to learn to network, and to come away with action items that you can use in your company. So we're going to go ahead and roll the clip. I hope you enjoy that and I hope you enjoyed this episode. So thank you for joining me, Brian. How are you doing?

[00:41:03] Guest 2: Bryan Lapidus: I am doing great now.

[00:41:06] Host: Paul Barnhurst: How stressed have you been the last few days preparing for this conference?

[00:41:10] Guest 2: Bryan Lapidus: I am so worried I'm going to forget something. There's like, overlook something or, um, you know, it's all the details, right? We've been planning this for over a year. Um, you know, from the site selection to first of all, is there a viability for it? Is there a market for it? And we went through a series of our virtual, our virtual series, very creatively named the A series. And what we saw was we were getting you come up with four on your own. You would think, with my level of creativity, it's it's very good SEO. It's the FP&A series, the FP&A forum, the AFP conference. Right. It's you know, what you're getting. But we went through a series of these video half day, uh, virtual webinars. And as the momentum built. We said, look, we have to get back to doing a live, in-person event. So pre-COVID, we had Finn next. And then, you know, we had in 2018, 2019, and then two weeks before 2020, we canceled right in Covid. Um, and everyone is still upset. Everybody wants to go back to New Orleans. So at some point in the future we'll make it back there. But this is the first time we've had an FP&A only event since since Covid.

[00:42:21] Host: Paul Barnhurst: Oh, wow. Exciting. And how many people have you registered for it? What's the kind of numbers you're?

[00:42:25] Guest 2: Bryan Lapidus: We, um, we have more than 500 people coming. Um, and honestly, we kind of had to close the close the registration, um, just for capacity limits here at the site.

[00:42:36] Host: Paul Barnhurst: So that's a good problem to have. I mean, obviously you would love to have everybody that wants to come, but at least it shows there's demand, right?

[00:42:44] Guest 2: Bryan Lapidus: It proves the market right. What you're doing, what we're doing right. The thirst for content and the ability to get together with people in that sense of everybody around is an FP&A and they understand what we're doing right. There is a definite need for that.

[00:42:59] Host: Paul Barnhurst: Yeah. And why do you think there's such a thirst for.

[00:43:01] Host: Paul Barnhurst: Content right now.

[00:43:02] Host: Paul Barnhurst: For FP&A?

[00:43:04] Guest 2: Bryan Lapidus: Fpna has a couple of things that are that are unique. One is it's still a relatively new app. Our certification has been out for 11 years now. Right. So if we kind of think about that as when we started really working to define the role, right. It's been a little bit more than a decade since I worked in FP&A at American Express and at other companies. That term didn't actually exist. So we're developing it. It's a job that's in that is in development. And also what the other thing we're seeing is the increase in volatility in change. Right. They'll go through the whole Vuca acronym. Right. We're living with volatility uncertainty complexity ambiguity. We got it all. So people need help. Companies need help saying, well, what does this mean? If tariffs change, if exchange rate changes, the interest rate was up. It's down right. Where is it going? Who is best positioned to sit in between the financial understanding and the business relation of that. Right. FP&A fits in that role, speaks to the business, speaks to finance and can play that interpreter role. And we're in demand.

[00:44:14] Host: Paul Barnhurst: Yeah. No I, I hear you. It's very true right. I mean I see it all the time. The number of emails I get from people asking for help, wanting to move from accounting to FP&A and some of those people, hey, can you help me find someone? I'm looking for a candidate or whatever it may be, because FP&A, I think, you know, as I used to say when I started at American Express, I felt like it was for a lot of time, financial planning and reporting. Yeah. You know, and today the analysis has just become more and more the strategic, the commercial, you know, yes. You're dealing with numbers. You have to understand that. You got to do reporting. You have to understand accounting. But really it's about helping the business make better decisions through numbers than it is about numbers. In the role.

[00:44:56] Guest 2: Bryan Lapidus: I think we have to make sure that we remember we work for the CFO. Yes, because everybody plans, right? Supply chain plans, marketing, everybody plans. But the difference is that it's planning focused on return on capital. And so I think what Fpna does is it says where do we put our next dollar of capital so that it gives us the best possible use. And if that's budgeting or forecasting performance metrics. Right. Ad hoc analyzes all these things. It's all about where we put that next dollar so that the company grows and we can all, you know, we could move on to the next big thing. Yeah.

[00:45:32] Host: Paul Barnhurst: It's about managing and maximizing the capital that you have. It's really about capital allocation. End of the day. And we've all. I know early in my career there were things where I look back now, it's like I should never have approved that project. Yeah. You're laughing. I'm sure you've had a few like that.

[00:45:47] Guest 2: Bryan Lapidus: Yeah. You know, it seemed. It seemed good at the time, right?

[00:45:50] Host: Paul Barnhurst: Or, as you know, I had my Ron Monteiro say he went to one of them early in my career. He's like, I just wouldn't speak up. It's like, oh, the business wants it, okay, let's just do it. He goes later on. I just learned, no, you have to let your voice be heard. And if you think it's a bad idea, explain why. Because sometimes it's easy for the business. Oh, yeah. We should do this. It will be a great success. And you're kind of looking at it going, I don't know. The numbers quite support this.

[00:46:11] Guest 2: Bryan Lapidus: Yeah. I think and I'm going to quote Rob Tripp here when he wrote and worked on our modeling guide. He said at the end of the day, the executives all sit around the table and they and they're looking for different parts of the business to bring certain things to the table. He is supposed to bring a certain point of view. Marketing is supposed to bring a certain point of view to finance. We are supposed to bring a certain point of view. And it is quantification looking at outputs and alignment with strategy. It's metrics. And it's that CFO sense of, is this a good investment? Is it? Am I going to get the right return? And do we have enough control points in place? Start stop nodes. Um, have we thought through. You know where decision points are and the gating process and investment process. That's what we do. And when you get everybody together. Right. This is where the partnership comes in. When you get everybody together. Right. That's when the best decisions come through. That's the role that we play.

[00:47:12] Host: Paul Barnhurst: Yep I agree. So let's go back to the conference for a minute. Any you know tell me a little bit about what the theme is. You know speakers, anything you're really excited about that's going on. Give a little overview of what it's going to be like for attendees.

[00:47:27] Guest 2: Bryan Lapidus: So because we have 30 different sessions all FP&A focused, what we do is we actually try to make sure we cover the breadth of FP&A. And this all actually ties back to our maturity model. So we want to make sure that we have content in the finance and financial processes category, right? That is the way that finance delivers its, um, its finance acumen. Yep. We have a technology and data section and that includes AI get you know, call it AI is next gen or current gen technology, but also basics like EPM tools and transformation stories and just getting your data right. Like all that foundational part that's in that technology and data track. And then we have a personal and team effectiveness track as well. And so that is how can I be better as a leader. How can I make my team better. Um, what are the soft skills and the partnership and the communication skills? We all put that in personal and team effectiveness. And then we have another track with our vendors. And so vendors are have the ability to show some of the technology. We have demos um, we, you know, almost like a technology petting zoo. Yep. We have, uh, three different Round tables or ask me anything sessions with experts. We have two keynotes. I mean, it really is the broad view of what it takes to do this job and to do it well.

[00:48:52] Host: Paul Barnhurst: I love that. Yeah. That broad view in 30 sessions, there's not many places you're going to get that kind of focus on. FP&A. It's really exciting.

[00:49:00] Guest 2: Bryan Lapidus: And you know, it's. And everybody comes for something different, right? There are people who come because they want AI. They want to know, what do I do? How do I do it? And there will be practitioner case studies and opportunities to ask about that. And there's one person I know, he's a consultant. And he says, he says, look, Brian, I've got clients. They know they're not going to be world class. They just don't have the budget. They don't have the capabilities. Right now, they're struggling to get to mediocrity. Right. How do I use today's tools? How do I use Excel and Power BI and get my data in the right place? Maybe after I get that foundation in place, then I can start looking for the next gen. But there's got to be something for them. And then, you know, I really look at technology as a means to an end, right? We're not in this job to be AI people. We're in this job to be finance people. So you can't overboard just on technology. You have to make sure your processes make sense. The financial skills, right, that we're still sharpening the saw on what it means to be good in finance and to be a good partner. So with all these 30 sessions, I think we've got something for everybody that's great.

[00:50:11] Host: Paul Barnhurst: And I really like the point you made about, you know, technology is I like to say it's people process and then technology. You need to get the people of the culture right. And technology enables you to do more. But technology by itself is not a solution, right? It's not about AI. It's about being more effective. With AI.

[00:50:29] Guest 2: Bryan Lapidus: We have a speaker who's coming here. And in a previous interview with him, he said, look, when it comes to machine learning, when it comes to that flavor of AI, we've solved the problem. It's not a mystery. We know how to do it.

[00:50:41] Host: Paul Barnhurst: Yes.

[00:50:42] Guest 2: Bryan Lapidus: It's getting the people on board and getting them to understand and tying them to the process. But the actual how do we set this up and how do we get our data and how do we run the prediction and all? We got that.

[00:50:53] Host: Paul Barnhurst: I mean, all you got to look at is take Microsoft find they spoke a few years ago. I think it was the first one I went to in Philly, where they showed that machine learning was better at forecasting their revenue, their real estate, and other things, and they built it all where they were using humans. The biggest thing was getting people comfortable with it. Look at meta Facebook, they released their Fin algorithm. And I know someone who worked was the first data science hire in the finance team because they couldn't get accurate in forecasting, and she was getting it within 2% a day on the, you know, the forecast of what their revenue would be using data science. And so it's their finance. People just need to implement it, get comfortable with it. And AI will make that easier. AI makes it easier to data citizens if that makes sense. That citizen data scientist Versus. I gotta go get a full degree to understand all this. There's still stuff you have to understand, but it's much easier. You don't have as much knowledge as you can get comfortable with. Okay, this makes sense. I'm okay with the numbers. You may not know all the sausage making, so to speak.

[00:51:50] Guest 2: Bryan Lapidus: I think that's the most exciting thing over the years to see how this job has changed since, you know, I had my first my first job where you had to be the person who gathered the data, right? You got to be the data wrangler and the data cleanser. Right. And you I think I've stolen your line on this, right? You have to be a Swiss Army knife, because you have to have all the tools in order to be an FP&A. And what's happened over the last decade is that with maturation has come sophistication and sophistication of tools, sophistication of the skill sets, the defining of the tools. And this is where I think working at AFP is so exciting, right? I look at the job as we were fumbling our way through it 20 years ago. Right. And now there's like dedicated skill sets and conferences and this is what you need to know. And here's how the technology has progressed to make you better at this job. Honestly, this could be this is the best time to be an Fpna.

[00:52:43] Host: Paul Barnhurst: It is. It's really exciting to watch it go forward. It's really viewed no longer as just a back office function, but people see it as strategic value creator. It's important. The best companies have good FP&A that you don't notice. They're just in the background helping things work well and making sure you said the capital is allocated appropriately, that we're making smart decisions. Not that we're getting every decision right. Because if I like, say, if I could forecast that, well, I wouldn't be working in this field. I'd be sitting on a beach somewhere, you know, because I would have made it all in the stock market. But it's about that planning and choices and being strategic and smart and helping guide not about being right all the time.

[00:53:21] Guest 2: Bryan Lapidus: Right. Because you're never going to be right.

[00:53:23] Host: Paul Barnhurst: Exactly.

[00:53:23] Guest 2: Bryan Lapidus: Certainly not all the time. You know, the blindfolded monkeys might eventually get the right, you know, budget forecast number, or you might hit the budget, but you can't plan on that.

[00:53:32] Host: Paul Barnhurst: Yeah, exactly. Well, I hope you enjoy the conference. Thanks for carving out a few minutes. I won't take much more of your time, but I really appreciate you chatting with me and excited to release an episode with some of the other speakers and people that are here this week.

[00:53:43] Guest 2: Bryan Lapidus: Yeah, love having you here, love working with you and enjoy the conference.

[00:53:46] Host: Paul Barnhurst: Thank you. Appreciate it Brian.

[00:53:47] Guest 2: Bryan Lapidus: You bet.

[00:53:48] Host: Paul Barnhurst: 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.