In business, success relies on good intelligence then good decisions. Without the right data, organisations struggle to respond to change ahead of the market. They can’t easily see what’s working, what’s not, and identify areas to improve their bottom line.
It is no surprise, then, that finance teams value insight into their data more than most. I’m yet to meet a person who loves analytics more than a results-oriented chief financial officer.
But while finance teams know that analysis is important, they often think their finance systems are too big or inflexible to provide relevant insights; or their systems can’t provide the data they need. Beyond this, current systems don’t provide an effective platform to plan for the future state of the organisation.
This leads to missed opportunities. Finance executives end up with little insight into their organisation’s drivers to provide management. Or it takes them many hours to manually produce necessary reports to deliver this insight.
Inevitably planning is also manual, based in spreadsheets, which leads to frustration as the right people can’t easily be involved in process, nor can they be responsive and dynamic with their planning (eg, use driver-based planning). If they could, the organisation would get better results.
Finance needs reporting and planning solutions which combine financial and non-financial data. They need to be able to report immediately, analyse, predict and model scenarios to support decision making.
The right reporting and planning solution can deliver the answers. Here are four ways it can unlock new business insights from your data.
- Model the future state
With modelling, a popular and standard planning capability, you have the power to learn the outcome of different scenarios before there is impact to your business. It enables you to see how variables will affect cost, sales, growth, risk and return. For example, you could model scenarios to understand how a cost saving (or increase) will impact profitability, or a risk scenario of the impact on bottom line in losing a key customer, or the impact on a capital project on cash flow.
Capabilities include, but aren’t limited to, cash flow forecasting, ‘what if’ scenario planning and predictive modelling.
Most finance teams wouldn’t mind greater control over their financial planning or an improved ability to plan ahead. The right finance system can help with the first, while a planning solution can help with the latter. By using a solution to swap spreadsheets for dashboards that provide visibility across data sources, you can analyse, plan, predict and interpret financial information in new ways.
- Manage the process
Hands up the spreadsheet users? While Excel spreadsheets are fine for basic reporting, they aren’t ideal for sophisticated budgeting and forecasting, as they lack workflow and approval capabilities. It’s important to remember our planning is part of a business process and this needs to be managed too.
- Report and analyse the way you need to
Every finance team should be able to build customised analytics, reports and need not reply on solutions that provide a set way that doesn’t allow for flexibility. Look for a solution that provides all of the tools to create and update databases, data presentations, analysis and models from a single dashboard.
If you’re a CFO or member of a finance team, you’ll know that business performance is affected by a handful of key drivers.
By using a complete solution to understand how these drivers affect margins, profits and cash flow, you can quickly identify opportunities and risks and become more proactive with your organisation’s financial decision making.
Take up the challenge and don’t be an average company – come to our free seminar and learn how to streamline your budgeting and forecasting process.
You can read more about business intelligence here.
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