What questions a CFO should ask himself for BI / MIS Reporting!
The business issues identified are clearly driving a need for intelligent and real time information on financial and operational performance. Reporting is seen as a time consuming task (perhaps not surprising given the high use of spreadsheets) and on a more positive note, CFOs very firmly believe that they should focus on non-financial measures of performance as well as financial data.
The most commonly used tool for reporting is still the spreadsheet, followed by the core financial/ERP system and lastly dedicated reporting tools.
CFOs and finance organizations have historically been stewards of data and information. Most of the CFOs view information as a major asset justifying significant investment, and many believe that they could manage information better. Thus, information viewed as critical, yet underutilized corporate asset.
CFOs feel improving performance management as their top opportunity and challenge. Improving access to information which is tightly linked to improving performance management is also a significant concern.
Moreover, CFOs expect to continue to shift their workload away from transactional activities, which will be increasingly automated or outsourced, toward decision support and performance management, thus providing much greater value to their organizations. Yet, their enterprises continue to struggle to glean insight from an abundance of data.
Managing data and information is improved by technology. So, in recent years, organizations have invested heavily in business intelligence (BI) initiatives, but many are not realizing the anticipated benefits. Lured by the promise of enhanced business performance, many are mired in a fragmented, overgrown BI environment and frustrated by lackluster results.
As a consequence, these organizations still face the challenges that triggered their initial BI investments, including inconsistent data, impaired visibility, data redundancy, information overload and delayed delivery of information. Too often, the benefits from BI initiatives are not quantified or articulated. What’s more, BI efforts may not be aligned with an organization’s objectives or individuals’ roles.
Though many organizations have diligently laid the initial groundwork, their BI initiatives lack a common framework. Typically, there are gaps in relating information to decisions/actions, a lack of overarching methodology and disparate approaches to discover and measure the value of BI initiatives.
Releasing the data to end users, and creating tools to allow decision-makers to leverage the data, requires a dedication to support and empowerment that still makes many CFOs uneasy. Because of this, larger BI/analytics projects require buy-in from the top of the organization to succeed.
Are you satisfied with your finance team’s ability to execute these core finance activities?
- Planning, budgeting & forecasting
- Ad-hoc analysis and decision support
- Management reporting
- Financial consolidation
- External reporting
- Transaction processing
- Regulatory compliance
Does your processes and technology support the following management reporting objectives?
- Allow what-if/scenario analysis
- Give end users flexible desktop access to additional information
- Prepare reports useful for decision making
- Prepare unimpeachable reports on actual business performance
- Prepare timely reports on actual business performance
- Provide end users with line-item detail on budgets and results
Does your processes and technology support the following?
- Give users sufficient what-if analysis
- Provide access to non-financial info
- Right information at the right time
- Provide familiar user interface
- Compare planned v/s actual performance
- Allow managers to control access
- Maintain data security
Which of the following if improved attributes of your company’s financial information would yield the greatest business benefit?
- Ease of analysis
- Timeliness of information
- Breadth of information
- Accuracy of information
- Level of detail
- Audit-ability of information
Which of the following problems inhibit your company’s ability to change its performance management analysis and reporting systems?
- Lack of time, budget, and resources
- Other initiatives are a higher priority
- Overly complex, disparate IT systems
- Organizational resistance to change
- End-user resistance to new technology
Do you find difficulty in terms of work load, stress level, etc. while performing the following tasks?
- Capturing data needed to make decisions at the operating level
- Capturing data needed to make decisions at senior management level
- Accommodating ad hoc requests for data
- Disaggregating financial and operational data
- Consolidating data from different product/business units
- Completing budgets on time
- Maintaining financial control
- Closing the books at the end of each reporting period
- Running routine finance functions (eg, accounts payable, expense controls)
- Balancing the company’s investment portfolio to manage risk
- Preparing for M&A activity
- Identifying new opportunities for growth
- Complying with regulatory requirements
- Creating unified reporting across operating units
Are you able to perform the following finance functions timely?
- Providing information needed by lenders, investors, and strategic partners
- Providing metrics needed to track and reward employee performance
- Working with business units to make budgeting more flexible
- Adjusting hiring budgets to reflect changing work requirements
- Using automated systems to consolidate financial results
- Setting authorization levels to allow more distributed decision-making
- Obtaining company-wide agreement on definitions and approaches related to risk management
- Encouraging the company to take calculated risks
Does your company’s current financial IT systems meet the following?
- Routine functions such as reporting, accounts payable/receivable, tax and expense control are automated, and run smoothly with little manual input
- The finance department has efficient and cost-effective systems to collect the data it needs to ensure timely regulatory compliance company-wide
- Finance and operations people throughout the company are linked via flexible automated systems which allow continual updating
- Data are visible and readily accessible to employees who have a need for such access, but are also well protected from unauthorised users
- Financial data-collection in the regions/business units uses the same format and systems as data collection at headquarters
- Budgeting, planning and forecasting systems are flexible and allow updating by different divisions as conditions warrant
- Finance project portfolios can be adjusted as market requirements change
- Managers have the right information and tools to make timely decisions
The job of CFO comes with enormous pressure, especially today, as the world’s economy enters uncharted waters, with galloping demand for basic commodities, and uncertainty around every corner. Yet difficult situations, do have their advantages. They offer of a level of freedom to act that is not present when things are going well. When the old ways have been proven inadequate, the new CFO has more latitude to make changes. We suggest that implementing BI solutions should be among the items for consideration on the short list of any CFO.
There is still considerable scope to enhance financial and non-financial reporting. Reduced reliance on spreadsheets (with all their inherent risks around data integrity, etc.) and a greater use of BI / MIS tools which allow easy, flexible and consistent reporting of data could yield significant benefits. Standard ERP and financial systems are good for transactional reporting. The use of business intelligence applications greatly enhances the quality and flexibility of reporting and data analysis.
Organizations considering information, management processes and supporting technology in a holistic manner – significantly improve decision making and can respond more quickly to changes in their business environment.
Move to proven BI for Financial MIS.
- Leverage a proven and cost-effective BI platform
- BPM as a way to standardize your financial intelligence
- Rich analytics: ad-hoc, what-if scenarios, slicing/dicing, drill-down/up, isolating, pivoting…
- Business driven and user-friendly interface
- Faster reporting and analysis
- Better Cost of Ownership
Visit http://www.maia-intelligence.com/1key-mis-server.htm for more details.
Posted on November 27th, 2008 by Ashwin Dedhia
Filed under: Business Intelligence, View Points & Perspective
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