Finance Business Intelligence

BI, Analytics & Reporting

- 3 min read

Finance Business Intelligence: What CFOs really need

CFOs are under increasing pressure to act as strategic advisors for the organization. Taking on this role requires them to produce and analyze in-depth insights, not only around finance but the entire business operation. Until now, gathering and understanding this data has not always been an easy task. CFOs are increasingly seeing the value of evolutionary financial business intelligence solutions which effectively combine standard data discovery and visualization features with planning & control and closing & consolidation capabilities.

Why traditional business intelligence software falls down in finance

Traditional Business Intelligence (BI) software has been used to present and analyze financial data for years, with dashboards and reports being used by management around the world. But these visualizations only provide a historical picture, lacking the ability to effectively model data, create scenario analyses, accomplish simulation duties, and support closing & consolidation activities. As a result, CFOs are not provided with the proper insights they require to guide the strategic direction of the business.

Some of the key challenges of using traditional BI software in finance include:

  • Lack of integration with the planning & control process – making it difficult to analyze, plan, and simulate effectively to provide a forward-looking perspective and accomplish complex gap analysis between actual and planned data
  • Lack of ability to properly manage consolidation and driver-based allocation – creating difficulty in determining and analyzing profitability across corporate dimensions, and adapting the solution to the opening of new sales channels or entry into new markets (for example, new product introductions)
  • Lack of ability to drill down to transactional level – making it hard to understand where data originated from and the underlying cause of results or anomalies
  • Lack of a global view in data visualizations – showing how most BI tools don’t effectively integrate multiple general ledgers, different legal entities, and cross-company data into one single view
  • Lack of ability to effectively organize, and reorganize, financial data – demonstrating that, with many BI tools, it is difficult to create P&L schemas (such as IFRS, GAAP, or managerial) with different timelines while ensuring the ability to examine data by different dimensions

The result of these challenges is a reliance on finance’s faithful companion, the spreadsheet, to manage tasks such as driver-based simulation, profit-and-loss and balance sheet schemes, reporting, planning, reconciliation, closing, and consolidation. As a result, the siloed spreadsheets used to perform these activities:

  • Lack accuracy – spreadsheets are static views of data which soon become outdated, making it harder to make meaningful decisions based on accurate figures
  • Are difficult to update and share – keeping everyone in the loop with the latest information is challenging when new versions are produced regularly
  • Are unsuited to the combination of data from different sources – merging data from multiple sources, and formats, is extremely time-consuming and can lead to mistakes

What CFOs need in a finance business intelligence solution

To overcome these challenges, modern CFOs need financial business intelligence solutions which are combined with planning & control and closing & consolidation capabilities to go beyond simple reporting. These solutions must mirror the organization’s business model, simulate the impact of specific actions, and support a strong connection between the operations and finance functions of the company in a more integrated approach.

Find out more in our complimentary eBook – Business Intelligence for the Office of Finance – which discusses:

  • The benefits of BI tools that seamlessly connect to financial planning and reporting
  • The capabilities CFOs need in a modern finance business intelligence solution

Be the first to comment on this post

Your email address will not be published. Required fields are marked *

Business Intelligence for the Office of Finance

Today's senior finance executives need to execute their accounting and reporting responsibilities, but of course that's only part of the job. CFOs are also business strategists, which means they must capably manage data as they evaluate and influence business-model changes. Download this eBook to discover the capabilities CFOs need in a modern finance business intelligence solution.