Still numerous organisations produce piles of paper when it comes to their monthly reporting. I’ve seen reports of over 100 pages with endless tables, analyses and clarifications in small font sizes, prepared by a small army of controllers. Almost no business manager finds time to go through that amount of paper in detail every month. What a waste of effort, time of scarce resources and trees!
The advantages of a digital solution for reporting are clear: management has direct access to the latest status to accelerate decision making. Periodic review meetings can be spent on discussing trends and actions as opposed to explaining the past. Though this is recognized in the finance function, organizations find it hard to switch to digital reporting altogether.
Representing the financial conscience of their organization, first and for most the finance responsibility is statutory reporting and, with that, complying with legislations. Therefore, finance transactions have to be processed and recorded in a correct and efficient way, so financial accounting can close the books and deliver the consolidated numbers in an acceptable timeframe. One of the trends we see in this area is Robotisation. Not only can the bookkeeping function be executed in an automated way, Robotical Process Automation also claims to lower error ratios and is an answer to the need of the finance function to be innovative and increasingly digital.
The other trend we see in finance is Digital reporting. Mobile solutions enable business managers to zoom in or out on data with a simple double-tap to answer queries that appear while going through their reports. The annotation tool and email functionality make it easy to connect with finance specialists for deeper analyses, even when travelling or working from home. There are technological configurable solutions in the market, like CXO-Cockpit, Microstrategy and QlikView, that bring together (non-)financial data in formats that leave room for the business user to play with the data and find answers and insights themselves. Another method is to build an adapted solution that is specifically tailored around your organisation. The choice depends mostly on the target audience and their digital savviness, and the availability of financial and non-financial data across the organisation.
An additional effect of both trends may be that scarce finance resources are less occupied with manual tasks and can spend their time on performing more value adding work for the business, like creating insights from financial data and providing other data related services in complex decision making processes.
The digitalisation itself is often not difficult, but defining the need for specific information and reports takes time as does selecting key performance indicators. CFO’s, get used to this new way of reviewing performance without the pile of paper on your desk that reminds you to start preparing for the next meeting. Crucial in making this transformation a success is to acknowledge that a dialogue is needed between finance and business. Data and analytics can unleash the hidden treasures of insights, but they are worthless if they don’t land in the business and are actively executed and monitored. On the other hand, business may not always be aware of questions they may have and insights they need to improve performance. Digital reporting is an important step to bring finance and business closer together.