CFOs and financial controllers are feeling increasingly vulnerable as they struggle to produce forward-looking insights amidst ever-changing regulatory environment and ever-growing amounts of information.
According to a new report, “How Can Reporting Catch up With an Accelerating World?”, released in October from EY, 66 percent of respondents say the increasing volume and pace of data is significantly impacting the effectiveness of reporting. That’s up from 57 percent in 2015. The annual global report polls 1,000 CFOs or heads of reporting of large organizations across 25 countries.
These financial professionals noted that in 2016 the organizational environment intensified in complexity, as organizations added more legal entities, business units and reporting systems. A full 64 percent reported a surge in the number of reports requested by shareholders. Yet the survey goes on to say that reporting teams don’t have access to the technology or tools needed to make sense of —and actionable decisions on— vast oceans of incoming data. Continue reading
In today’s ever-changing business environment, senior executives are expecting more from the F&A department than reports and financial statements. They now want to see how finance can bring greater value to the table in the form of forward-looking insights.
So Much Data, So Little Time
Companies are flooded in data. Most of it compartmentalized in organizational functions and verticals, from customer data locked up in CRMs to inventory stored away in ERP systems. In today’s world, amassing data isn’t good enough; it’s all about getting the insights needed to make smarter decisions faster.
From anticipating changes in the marketplace to deflating ballooning operational costs, strategy analytics can play a strong role in increasing a company’s competitive edge. Pulling in both historical and current information, analytics can be used to understand the overall performance of the organization, improve processes and solve business challenges. Continue reading
Cash forecasting is probably one of the most important tools for financial management. With global uncertainty, especially in light of the Brexit fallout, the ability to better manage and predict cash flow is garnering strong interest from organizations around the world.
Accurate cash forecasting can be critical to survival. It’s much more than just a prediction – it informs major business decisions for both internal and external stakeholders. If hedges are not on the mark, a company may be forced to borrow or dip into expensive overdrafts.
Yet many companies struggle to accurately forecast cash flow. Chief among the issues they grapple with are:
- No Centralization: A lack of standard processes and systems limits visibility into the timing of cash flows. Having a centralized model yields better cash and working capital management. It also makes it easier to manage liquidity and funding risk.
- Multiple ERPs: With disparate, unconnected systems, finance teams face major obstacles to finding and verifying data.
- A Preference for Spreadsheets: Left to their own devices, forecasting staff often use Excel spreadsheets. This results in information siloed away on desktops or errors caused by manual entry. It’s not uncommon to uncover treasury departments with 50+ distinct spreadsheets.
Knowledge is power. And, the ability to get an instant gauge on the fiscal health of a hotel portfolio or brand, as well as the knowledge needed to make a new acquisition or divestiture is even more powerful. Investors —and other key stakeholders—want to know how their assets are performing with access to accurate statements and reports as well as KPI dashboards from anytime or any location.
Enhanced financial reporting transforms data into actions for investors, giving them greater insight into risks, opportunities and value creation potential. Better quality reporting, delivered rapidly, also engenders better relationships and increased investor satisfaction.
Step 1: Get Over the Hurdles
Finance reporting places a pressure on the management and delivery mechanisms used by hotel management organizations. Consolidated, standard reports (and ad hoc reports) tailored to each hotel brand or portfolio owner can be a challenge to produce in a timely and encompassing manner. Continue reading
In the hotel industry, growth is a top priority. Efficient operations and first-rate customer service are crucial to business success. Yet for hotels using an asset-light strategy — a franchise model or long term property management contract— it can be a significant challenge to deliver the comprehensive reporting required for optimal performance and consumer satisfaction.
Front office workers rely on customer relationship applications, while back office staff use ERP applications and workflow tools. As a result, customer, vendor and financial data are isolated within each location, leaving hotel organizations with next to no shared information or transparency.
Pulling metrics like occupancy rates, cancellation rates, ADR and RevPAR are all key to keeping a pulse on the business. Yet, multiple, incongruent systems and non-standard reporting practices make it difficult to draw insights about the overall brand and property performance— and nearly impossible to make mission-critical business decisions. Continue reading
For large enterprises with multiple divisions, spread across a number of geographic locations, there’s a high probability that Finance Planning & Analysis (FP&A) data exists in silos. It’s an overwhelming challenge to get people, systems and data all on the same page. The planning and analyst people who are paid to glean insights and provide decision-making reports instead spend tremendous amounts of time trying to understand data and reports that don’t align because the data didn’t match up.
A Case in Point
Our client, a global Fortune 500 software company, was facing some key challenges typical to organizations around the world:
Global Updates Needed In a Siloed Environment: The data required constant refreshing to create different area reports. The client faced obstacles relating to time zones, siloed data due to discrete systems or locked away in offline applications, and a cumbersome data extraction process that only exacerbated the reporting inefficiencies. Continue reading
Gathering and deriving valuable information and actionable insights from enormous amounts of data is a key challenge faced by companies the world over. The challenges stem from multiple disparate systems and applications that cannot “talk” to one another, resulting in siloed data. Often, the task of consolidating all the data required for standard and ad hoc reports is extremely difficult, and at the least, very time consuming.
The result is that finance staff members spend too much time gathering data and managing spreadsheets, and too little time providing value-added analysis and actionable reporting.
Then add into the mix version control issues, human error, unstable macros, broken formulas, security risks, the inability to collaborate across the enterprise and any number of other problems that undermine reporting, budgeting, forecasting and financial planning. Continue reading
What drives a high performing Accounts Payable department? Yes, automation. It seems like a no-brainer, yet the Institute of Financial Operations recently conducted a study of finance execs, AP managers and shared services directors that showed that despite all the tub-thumping about automation, Accounts Payable departments are still extremely reliant on paper.
In a rather disheartening statement, the 2014 AP Automation Study noted “Only about 9 percent reported that their operations are highly automated, receiving less than 10 percent of their invoices on paper. On the flip side, about 29 percent said paper accounts for more than 90 percent of their invoices.”
The Promise of Automation
Getting rid of the sheer amounts of paper workflow through digitization increases efficiencies. Digitization can range in sophistication from digital images of paper copies to advanced EDI 810 data formats. Continue reading
More than ever, companies are awash in information. And on the surface, that’s a good thing. Executives stand to benefit significantly by gleaning report insights from data to fundamentally transform their companies, evolving established business lines and generating greater growth.
But the fact is that many companies fail to capitalize on their data. They leave it in the back office instead of leveraging it to drive profits and remain competitive. In today’s highly competitive business environment, C-suite executives can’t afford to waste such valuable opportunities.
CFOs in particular face unprecedented pressure to drive growth. As their role has gotten increasingly complex, their responsibilities have extended to include four main areas: profitability, cash flow, operational effectiveness, and governance, risk and compliance. To achieve business excellence and secure a lead on the competition, CFOs need solid reporting and business intelligence, enabling them to make better decisions and take advantage of opportunities as they arise. Continue reading
Complexity. CFOs are swimming in it. Companies are spread across various geographies, with each business unit often having its own set of practices and technologies. Getting a single version of the truth from diverse systems, structures and processes is near impossible.
Awash in data, organizations around the world struggle to derive meaningful information and insights that could give them a leg up in the global marketplace. This struggle is particularly acute in the Financial Planning & Analysis (FP&A) department. Yet F&A departments are under the microscope and need to keep costs under control.
At first glance, the situation can look a little bleak. But there is a solution. Continue reading