Are you looking to start your career in a financial planning and analysis (FP&A) role or looking to make a career change to a different company? Luckily, just about all companies have FP&A roles. However, the size of the company you work for can make a significant difference in your day-to-day life.
In this post, we’ll discuss the key differences in FP&A roles between Fortune 500 companies and smaller ones.
Key Differences in FP&A Responsibilities
Smaller companies typically don’t have the same resources available as larger companies. Accordingly, working in an FP&A role in a smaller company means you may take on more responsibility and complete a broad range of tasks. You will probably have your hand in everything, including budgeting, forecasting, and strategy. You’re likely responsible for analyzing all business departments and developing projections for the entire company. Some small companies are start-ups that will need your help setting up processes and establishing metrics.
Working in a larger company means your responsibilities may be more focused. The company will likely assign you to a specific team that is only responsible for the financials of a single business unit or company function. For example, data analysts at a multinational consumer goods company might focus exclusively on expense forecasting for the marketing department of a single product line, such as health and beauty. Large companies also tend to have varying responsibilities based on your role level, i.e., a manager will have more responsibility than an associate.
Differences in Tools and Technology
Just like the roles in a large company are different from those in a small one, you will also most likely find the technology you use daily is different. Based on implementation time and data collection and presentation capabilities, some software works better for a large company with multiple business units than a small one with only one or two departments.
Large companies tend to use software that can handle data analytics with complex finance functions. Software like Workday Adaptive Planning that integrates data across multiple business units and allows access to many users is a good fit for Fortune 500 companies.
Small companies, on the other hand, may heavily utilize shared Excel files or easily managed software that integrates with Excel like Prophix.
Differences in Strategic Impact and Decision-Making
If you are looking to have more of a strategic impact or a decision-making role, a smaller company may be the better option. Since FP&A teams at smaller companies tend to have only a few people, you will communicate and work closely with leaders in strategic decision-making roles. The information you gather and present to them will influence their decisions. You may be only one of two people or the sole person developing budgets and forecasts for the company that can impact the direction and scalability of the organization.
Since larger companies tend to have larger teams working in the FP&A function, unless you are in one of the top roles, your influence over strategic decisions will be considerably less compared to a smaller company. If you are an associate or a senior, you will report directly to your manager, who will then communicate your team’s forecasts and planning to business unit heads or other company leadership. It may take years before you find yourself in a position where you have a major impact on the strategic decision-making of the business.
Differences in FP&A Career Path
As with many other roles in small businesses, the career progression is most likely limited. With smaller teams, there is less role-level diversity. The company may hire you for a role with limited to no opportunities for advancement. You may stay in the same position doing the same work for your entire career or find yourself in a more senior role earlier. Some may view this negatively, but it also allows you to have more responsibilities earlier in your career that you may not have starting at a larger company.
The career progression at a Fortune 500 company looks much different. Commonly, there are different role titles that you spend years progressively working your way up to. Most FP&A employees start as associates and eventually work their way up to leadership roles. Additionally, depending on your role, you can leverage your current position at one of these companies to land one of higher or equal standing at another.
Differences in FP&A Skills
Since smaller companies have leaner teams, you may take on more responsibility and learn things you wouldn’t have the opportunity to at a larger company. These roles require strong critical thinking skills since you may often find yourself researching the answers to your questions.
You will also probably have to communicate more with colleagues outside your department. You will need to speak regularly with business unit leaders to understand their needs and prepare accurate budgets and forecasts. This will require you to master effective communication skills so you can deliver financial messages to non-financial employees.
In a larger company, you may find more opportunities to refine your technical skills with more team members you can go to for help and more specialized work to complete. Commonly, entry-level analysts concentrate on data gathering and building financial models so you will plenty of opportunity to develop these skills early in your career. Additionally, as you progress at a Fortune 500 company, you must develop soft skills like effective communication, as you will interact more with business unit leaders and company executives.
Challenges Unique to FP&A in F500 and Smaller Companies
Undoubtedly, there will be challenges for FP&A roles at any sized company. For smaller ones, we’ve already touched on the fact that you will be working on smaller teams, so there are fewer resources available for you to go to for guidance. You may find you need to find the answers to your questions on your own.
On the flip side, larger companies offer plentiful resources, but the work you are assigned to complete is very specialized, with few opportunities to learn new things outside of your role responsibilities.
Conclusion
The roles and responsibilities of FP&A professionals will vary based on the size of the company you work for. A professional working at a Fortune 500 company will have a different experience than one at a small company. The company size that is right for you depends on your personal preferences and situation.
