As the CFO of your company, your organization relies on you for more than just numbers. Yes, spreadsheets and financial reports are the hallmarks of your profession. But what about business intelligence and forecasting? Do the tools you’re using give you what’s needed to see around the next corner and establish your company as an industry leader?
Today, the explosion of data available in business matches the explosion of competition in today’s markets, and CFOs need to harness that wealth of data to compete. They need better business intelligence to identify upcoming opportunities and jump on them before the competition does. They also need to foresee potential losses and advise on how to mitigate risk. In short, they need to predict the future so their business owners can react quickly.
Predicting the Future With a Business Intelligence Dashboard
Despite the high tech dashboards available, many CFOs are still reaching for high performance using antiquated tools like Excel. Ashamed of trying to compete in the hottest markets, many CFOs feel like they’re trying to build a fire with flint and steel.
The CFOs of advanced companies are no longer content to see their staff plod along pumping out spreadsheets that need hours of explanation and analysis. With the overwhelming amount of data available, better business intelligence and reporting demands sophisticated tools to drive a company from the base camp to the summit. CFOs must be able to visualize inter-relational data groups, see the connection among KPIs, identify potential for profit, and envision the future while strategizing.
What they need to boost performance is a financial reporting dashboard to aggregate data from different business units and provide insights into alternative strategies. Once various data sets are connected together visually, patterns emerge, extrapolation is possible, and the future is less murky.
Which Business Metrics Should CFOs Track?
Every business has its own set of goals, KPIs and benchmarks. Let’s imagine your company has set goals for the number of units sold. You’re price testing and want to understand the effect. You’d like to juxtapose your pricing with the numbers sold for various products. You know the sales will tail off at some price. But how can you identify the best price point for each product to optimize overall sales?
You also want to isolate the data for a few months to understand the combined effect of pricing, product, and timing. A pricing and supply dashboard could help you simultaneously visualize and share these data sets with your team. The highs, the lows, and any previously unnoticeable patterns could become apparent, providing real business intelligence to help set the optimal pricing for each month across all product lines.
In addition, a business metrics dashboard can track financial KPIs to flag performance problems. For example, you may want to track and report your benchmark versus cash position with year-over-year comparisons. In an instant, your dashboard could uncover a month of under-performance that must be corrected. The additional benefit? By sharing the dashboard, other departments get instant access to financial reporting so they can react quickly, instead of waiting for the monthly report to come out.
So Why Do CFOs Want Better Business Intelligence and Reporting in 2017?
Because they know they’re wasting time creating graphs and PowerPoint presentations. They know they’re creating confounding reports that don’t compare business metrics at a glance. They know they can improve efficiency by having visual data immediately accessible to key business units. And because they know they can’t really tell the future without a truly sophisticated tool like a business metrics dashboard.