What should be the scope of FAST? Does it have an application wider than financial modelling?
And if so, how should that scope be defined?
When FAST was first created, it was put together as a practical response to “Wild West” financial modelling. It was a challenge to the complex and unwieldy financial models that were being built for limited recourse debt financed infrastructure projects.
These days, FAST champions are particularly comfortable when the modelling assignment they are undertaking requires a forecast model with a timeline extending across the columns. It is obvious that the FAST standard is meant to be applied here. The resulting link-based model with workings laid out in calculation blocks (an approach described as “extreme modularity”) is easily spotted.
Yet a couple of recent conversations have caused me to wonder if the FAST standard of the future should have a much broader scope.
FAST standard vs its application
A standard sets out of way of doing things to the benefit of those that choose to adhere to the standard. It encourages a community to gather around it. An effective standard is one that the community finds helpful in supporting it to reach individual and collective objectives. People agree to work in a common way because they think it will be better than each adopting their own approach.
But standards in themselves do not promote good or best practice. They simply promote a way of doing things that is commonly understood by the community that chooses to adopt them.
Good and best practice, however, is likely to be identified through the application of standards. This is a subtle distinction, but an important one. It is the difference between a standard and its application.
Pivot tables
A recent Linked In post asked the question “why does the FAST standard not mention pivot tables?”. The simple answer is that pivot tables have not yet resulted in the heated debate that one might get from, for example, the use of Excel Names. Why should this be? Perhaps because pivot tables are simply not used as much as Excel Names by the type of Excel user who also comes across the FAST standard.
This is where the distinction between a standard and its application might be helpful. When considering points for inclusion in a standard, it might be better to start with the application of the standard. So instead of asking “why no mention of pivot tables?”, ask instead: “what practical problems are being solved through the use of pivot tables? Are there alternative approaches that achieve identical results through different means? Are there examples of good, bad and best practice that can be shared?”
Only then might we consider whether there are any conclusions that might cause us to reconsider what the standard itself says.
Scope of FAST
And as we test the application of a standard to more and more possibilities so the scope of the FAST standard will naturally widen. I am not going to predict where it stops but I hope as a minimum that the standard develops to support a Finance function in howsoever it chooses to use Excel – from monthly management accounting reports to transaction-led forecast modelling to expense claim forms.
So if I return to the questions I posed at the start of this blog, I find myself proposing answers:
What should be the scope of FAST?
Answer: the scope should not be limited by what FAST has traditionally been used for but instead should be developed in accordance with good, bad and best practice arising from its application.
Does it have an application wider than financial modelling?
Answer: without a doubt – so long as the FAST standard continues to develop in line with the consensus of the community that uses it.
And if so, how should that scope be defined?
Answer: in accordance with how members of the FAST community find it helpful to apply FAST.
