Finance Blog

Why your workplace needs collaborative learning technologies

Financial reporting cycles are under greater pressure than ever before. New compliance standards, increased transparency expectations and heightened traceability levels have all contributed towards a sizeable shift in the way in which organisations report performance information. As a result, Corporate Performance Management (CPM) is now becoming widely embraced as it allows organisations to be more efficient monitoring and managing their performance.

What are the benefits?

A consolidated approach to critical business data, not just financial information, provides a wider context through detailed budget comparisons and future forecasting that combines data from all key departments. Under this model, the financial reporting process includes forward-looking indicators including sales pipelines, competitor analysis, product launches and customer satisfaction levels.

With the primary objective of reporting being to reveal what is going on in the business at any given time, this evolution is now essential to meet the fast pace of today’s corporate landscape – with financial reports that are accessible to multiple teams helping to engender collaboration.

Cross-departmental dialogue allows finance to work strategically with colleagues across the business in order to facilitate and improve the decision-making process.

CPM systems allow key stakeholders to access the latest view of business performance against internal budget and competitors, as well as the big picture of a company’s financial health.

Accuracy of data is key

The accuracy of this, however, is largely dependent on data quality. While spreadsheets have traditionally been used for reporting, they can be both cumbersome and prone to costly errors. CPM software marks a change in approach.

Extremely complex processes, such as Reporting and Consolidation, Budgeting and Forecasting, are not best supported by spreadsheets with high probability for errors. Rather, best practice sees data held in a single repository that incorporates powerful analytical tools as well as controls to ensure validity, security and quality.

Traditional ‘row and column’ financial data reporting must be taken to a new level by adding context. Finance professionals that do not do so will be unable to fulfil the primary objective of financial reporting: reaching the right people at the right time with accurate and usable information.

Financial reporting cycles are under greater pressure than ever before. New compliance standards, increased transparency expectations and heightened traceability levels have all contributed towards a sizeable shift in the way in which organisations report performance information. As a result, Corporate Performance Management (CPM) is now becoming widely embraced as it allows organisations to be more efficient monitoring and managing their performance. Read More

BI vs CPM – What’s the difference?

‘Is there a difference between BI (Business intelligence) and CPM (Corporate Performance Management)?’

 A question that has plagued board rooms and senior leadership teams over the past few years.

In short, the answer is “yes” there is a difference, knowing which one to choose however means understanding how they differ and what your specific needs are.

BI tools are bits of software that are very good at manipulating large volumes of data, very quickly. They can help glean powerful information like performance metrics and trends. This kind of information is great … to some people. It’s generally best suited to people who work within business analysis.  The data and trends that come out of it will give you detailed performance data for whatever data silo is being looked at. It’s detailed and specific, you will be able to drill down to a single transaction level if that’s what is needed. It is, however, a bit of a one way street, it will provide the information but won’t help manage performance using the information.

CPM takes BI much further; it looks at various KPI’s (key performance indicators) from different sources, information from multiple systems and lets you see them collated together. CPM systems use the information gathered to give a picture of what has happened and is happening (company-wide) but also helps manage where that picture is headed.

The system will help plan, forecast, and view the information in the context of corporate strategy. It can link the data to specific objectives and action plans as well as showing where potential risks might lay. Because CPM systems give true context for the data, taking into account things like cross charging and moving exchange rates it is possible to have an accurate current picture side by side with the future forecast. The unique combination of accurate, companywide, current information against forecasts allows the best decisions to be made at the top levels of management i.e. a two way street.

The appropriateness of CPM and BI tools very much depends on the size and complexity of the business, generally speaking the larger and more complex the business the greater the need for CPM. The decision to get CPM needs to come from the need to have a true company-wide picture of performance.

‘Is there a difference between BI (Business intelligence) and CPM (Corporate Performance Management)?’  A question that has plagued board rooms and senior leadership teams over the past few years. In short, the answer is “yes” there is a difference,… Read More