Business decision making has always been fuelled by financial data, but as data continues to swell exponentially business decision making has become dependent on the finance team’s ability to dissect and analyse this tsunami of information.
Traditional systems used by finance teams can often hinder their ability to make informed decisions and recommendations, creating bottlenecks in processes. Also, restricting finance executives in performing their essential role of providing key information to stakeholders to make informed decisions and possibly hindering the company’s growth.
Effective financial data analysis is the lynchpin to informed decision making and as such finance must become more responsive, agile and able to act more decisively than competitors. For UK finance directors (FDs), the recent Brexit decision to leave the EU and the subsequent political and economic uncertainties surrounding it, has added further complexity to their challenge. Regardless of where a company trades, there is likely to be a point in the supply chain which exists outside the UK. FDs must now use the data available to them to review any risks pertaining to an EU exit and support the business in overcoming obstacles to future business performance and growth.
Unfortunately, many finance professionals are struggling to deliver insight at the rate demanded of them. In a survey (opens in new tab) commissioned by Epicor Software with Redshift Research Ltd of 1,500 business professionals in 11 countries, 28 per cent of CFO’s interviewed felt that decision making is hampered by an inability to make effective use of information. They may be victims of trying to gather data from multiple sources and systems and attempting to make sense of it all with dated or manual reporting systems. The result? No time left to even consider, let alone to integrate a more efficient system that allows proactive and strategic decision making.
Microsoft Excel is still extensively used to download data and manipulate it into something meaningful. In fact, 60 per cent of CFOs interviewed stated that they are still using spreadsheets. Unfortunately, Excel is difficult to update automatically, so the data may not always be accurate. It also offers little capability for complex analysis and when trying to bring in information from multiple sources or include multidimensional elements, it often falls flat. It comes as no surprise that 44 per cent of CFOs interviewed see mistakes occur as a result of missing or inaccurate information. While Excel is easy to use and intuitive, it does not have the ability to deliver fast, on-demand access to the type of information that is key in today’s competitive business landscape.
Automation of value-add tasks and producing more accurate reports that can be delivered to stakeholders faster, will inevitably free up resources to develop and support the business with strategy, innovation and growth. Enterprise resource planning (ERP) solutions provide an end-to-end, central source of information - a single point of record where sales data can be accessed and analysed, financial data, operational data and so on. It can optimise the use of Excel and expand on it by adding new functions and formulas that enables users to pull data from a live source.
Modern tools like ERP should and can deliver the ability to access the information needed whenever and wherever required, 24/7. Whether through web browser, smartphone or tablet, there is no need to wait for IT or finance to create a report, the analysed data should be available on demand, on a self-service basis. Of course, this calls data security into question, but ERP vendors should provide security features such as personalised access rights to control what people see and who sees it.
ERP was once viewed as a tool for the Fortune 500, but today it has been developed as a solution for businesses of all shapes and sizes from blue-chip to start-up. Finding the right ERP solution for a business can give companies the edge, whatever their size or geographical footprint. However, it’s important to take the following into consideration when making a decision: ensure there is a full understanding of the objectives and desired results of a solution before purchase.
It's also important to confirm whether the ERP provider understands the industry and whether it has the right tools to support finance in overcoming its challenges. If the business runs internationally or has global ambitions, does the ERP provider have global capabilities and the ability to scale and grow alongside these ambitions? What customer support services does the ERP provider offer – can it meet the 24/7 demands of the business? Can the ERP provider support mobile working across multiple devices? Finance executives have a great opportunity to inform the business and drive decision-making, and being able to deliver information that the business needs can prove to be a huge win both personally and professionally.
Ensuring finance professionals have the right information at their fingertips at any time will aid in meeting their business growth objectives, by making better business decisions than ever before, boosting their reputation and adding credibility to the organisation.
Chris Purcell, Senior Product Marketing Manager at Epicor Software (opens in new tab)
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