Our recently published Office of Finance benchmark research assesses a broad set of functions and capabilities of finance organizations. We asked research participants to identify the most important issues for a finance department to address in a dozen functional areas: accounting, budgeting, cost accounting, customer profitability management, external financial reporting, financial analysis, financial governance and internal audit, management accounting, product profitability management, strategic and long-range planning, tax management and treasury and cash management. Among the key findings is this: Not using the most capable software is an underlying cause, often unrecognized, of process, analytics and data issues.
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Topics:
Mobile,
Planning,
Predictive Analytics,
ERP,
FP&A,
Office of Finance,
Reporting,
Self-service,
Budgeting,
close,
closing,
computing,
Controller,
dashboard,
Tax,
Analytics,
Business Intelligence,
Cloud Computing,
Collaboration,
Business Performance Management (BPM),
CFO,
Data,
finance,
Financial Performance Management (FPM),
Financial Performance Management,
FPM,
Microsoft Excel,
Spreadsheets
Our recent Office of Finance benchmark research demonstrates the importance of using automation to execute finance department functions. Information technology systems do at least two things very well that make better use of people’s time, and both of them can substantially improve organizational performance. First, they eliminate the need for people to do repetitive tasks, which frees them to spend time on more valuable work that requires judgment and skill. IT systems also can be programmed to focus only on relevant information while eliminating the need to get immersed in detail. The latter capability supports a “management by exception” approach, which enables executives and managers to better allocate how and where they spend their time.
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Topics:
Big Data,
Mobile,
Planning,
ERP,
FP&A,
Office of Finance,
Reporting,
Self-service,
Budgeting,
close,
closing,
computing,
Controller,
dashboard,
Tax,
Analytics,
Business Analytics,
Business Collaboration,
Business Intelligence,
Cloud Computing,
Collaboration,
Business Performance Management (BPM),
CFO,
Data,
finance,
Financial Performance Management (FPM),
Financial Performance Management,
FPM,
Microsoft Excel,
Spreadsheets
Finance transformation” refers to a longstanding objective: shifting the focus of CFOs and finance departments from transaction processing to more strategic, higher-value functions. Our upcoming Office of Finance benchmark research confirms that most of organizations want their finance department to take a more strategic role in management of the company: nine in 10 participants said that it’s important or very important. (We are using “finance” in its broadest sense, including, for example, accounting, corporate finance, financial planning and analysis, treasury and tax functions.) Finance departments have the ability and at least an implicit mandate to improve business performance and enable a corporation to execute strategy more effectively. Yet the research shows that becoming strategic is a work in progress. Most departments handle the basics well, but half fall short in areas that can contribute significantly to the performance of their company. More than three-fourths of participants said they perform accounting, external financial reporting, financial analysis, budgeting and management accounting well or very well. But only half said that about their ability to do product and customer profitability management, strategic and long-range planning and business development.
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Topics:
Big Data,
Mobile,
Performance Management,
Predictive Analytics,
Social Media,
ERP,
FP&A,
Office of Finance,
Reporting,
Management,
close,
closing,
computing,
Controller,
Tax,
Analytics,
Business Analytics,
Business Collaboration,
Cloud Computing,
Collaboration,
Business Performance Management (BPM),
CFO,
finance,
Financial Performance Management (FPM),
Tagetik,
FPM
When applying information technology to drive better business performance, companies and the systems integrators that assist them often underestimate the importance of organizing data management around processes. For example, companies that do not execute their quote-to-cash cycle as an end-to-end process often experience a related set of issues in their sales, marketing, operations, accounting and finance functions that stem from entering the same data into multiple systems. The inability to automate passing of data from one functional group to the next forces people to spend time re-entering data and leads to fragmented and disconnected data stores. The absence of a single authoritative data source also creates conflicts about whose numbers are “right.” Even when the actual figures recorded are identical, discrepancies can crop up because of issues in synchronization and data definition. Lacking an authoritative source, organizations may need to check for and resolve errors and inconsistencies between systems to ensure, for example, that what customers purchased was what they received and were billed for. The negative impact of this lack of automation is multiplied when transactions are complex or involve contracts for recurring services.
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Topics:
Big Data,
Mobile,
ERP,
Office of Finance,
Operational Performance Management (OPM),
Operations,
Management,
close,
closing,
computing,
end-to-end,
Analytics,
Cloud Computing,
Data Management,
Business Performance Management (BPM),
CRM,
Data,
finance,
Information Applications (IA),
Information Management (IM),
Sales Performance Management (SPM),
Supply Chain Performance Management (SCPM),
FPM
Finance and accounting departments are staffed with numbers-oriented, naturally analytical people. Strong analytic skills are essential if a finance department is to deliver deep insights into performance and visibility into emerging opportunities and challenges. The conclusions of analyses enable fast, fully informed business decisions by executives and managers. Conversely, flawed analyses undermine the performance of a company. So it was good news that in our Office of Finance benchmark research 62 percent of participants rated the analytical skills of their finance organization as above average or excellent.
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Topics:
Big Data,
Mobile,
Planning,
Predictive Analytics,
ERP,
FP&A,
Office of Finance,
Reporting,
Self-service,
Budgeting,
close,
closing,
computing,
Controller,
dashboard,
Tax,
Analytics,
Business Analytics,
Business Intelligence,
Cloud Computing,
Collaboration,
Business Performance Management (BPM),
CFO,
Data,
finance,
Financial Performance Management (FPM),
Tagetik,
Financial Performance Management,
FPM,
Microsoft Excel,
Spreadsheets
“What’s next?” is the perennially insistent question in information technology. One common observation about the industry holds that cycles of innovation alternate between hardware and software. New types and forms of hardware enable innovations in software that utilize the power of that hardware. These innovations create new markets, alter consumer behavior and change how work is performed. This, in turn, sets the stage for new types and forms of hardware that complement these emerging product and service markets as well as the new ways of performing work, creating products and fashioning services that they engender. For example, the emerging collection of wearable computing devices seems likely to generate a new wave of software/hardware innovation, as my colleague Mark Smith has noted. This said, I think that the idea of alternating cycles no longer applies. It would be convenient if we could assign discrete time periods to hardware dominance and software dominance, but like echoes as they fade, the reverberations are no longer as neatly synchronized as they once were. Moreover, adoption and adaptation of technology by consumers reflected in the design of work, products and services always lags – and lags in different ways, further blurring the timing of cycles.
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Topics:
Mobile,
Performance Management,
Predictive Analytics,
ERP,
Office of Finance,
Operational Performance Management (OPM),
Reporting,
Wearable Computing,
Management,
close,
closing,
computing,
Analytics,
Business Analytics,
Business Collaboration,
Cloud Computing,
Business Performance Management (BPM),
Customer Performance Management (CPM),
finance,
Financial Performance Management (FPM),
Sales Performance Management (SPM),
Supply Chain Performance Management (SCPM),
Workforce Performance Management (WPM),
FPM
