Ten features of an effective business decision-making platform
Article by Board Australia, Regional Sales Manager, David Hatt.
As the role of the chief financial officer (CFO) evolves, many are finding they need to extend their role beyond the finance department to improve business performance.
Operational data from sales teams, the human resources department, marketing, and supply chains need to be consolidated into a shared 'single version of truth' repository that can support informed and collaborative decision making.
However, while CFOs need to have access to large amounts of data, many find they lack the tools and expertise to perform the deep data analysis that needs to be undertaken.
In some cases, the challenge is even more acute because the data is distributed across multiple legacy systems that are poorly connected, if at all, or buried in unnavigable data marts. In other cases, the data is locked in spreadsheets on personal desktops or storage drives, making it inaccessible to all but the owner.
There is clearly progress that needs to be made when it comes to analysing and leveraging business data. Thankfully, decision-making platforms are emerging as valuable tools to help CFOs develop data-driven business strategies.
Selecting the right platform
An effective decision-making platform will deliver a comprehensive range of capabilities to support the CFO's planning and analytics processes. The ten key features a platform should offer are:
1. Unified business intelligence, planning, and predictive analytics:
The link between planning and analytics within the chosen platform should be seamless and based on a single, shared data set. From historical performance analysis to future predictions, the platform should enable the entire decision-making process to be conducted in a single environment, thus increasing ease of use and reducing complexity.
Advanced capabilities such as predictive forecasting, simulation, and what-If analysis should be present and easy to use, providing immediate feedback on different courses of action that in turn enable truly informed decision-making.
2. Complete planning continuity:
Data entry and simulation within the platform should support multiple dimensions and levels of aggregation. For example, once a user updates sales data by product lines, the changes should also be automatically distributed across geographic areas, channels, customers, and all other relevant segments.
Also, users should have the ability to add new planning items themselves, such as business units or products, while analysis, planning, and forecasting processes are running. There should be no need to rely on IT specialists.
3. The ability to extend financial planning and analysis capabilities:
To truly act as a strategic advisor to the business, a CFO needs holistic, 360-degree visibility of their organisation. The chosen platform should go beyond the walls of finance and unify strategic, financial, and operational data for complete transparency of performance and instant insight.
4. Embedded capability to manage critical financial processes:
The platform needs to make it possible to conduct allocations, consolidations, and conversions and incorporate the resulting metrics into the overall planning and analysis process. This also needs to be achieved with a minimal number of manual steps.
5. Support for granular data management:
At all stages of planning and analysis, data should be manageable at a granular level, such as product SKUs or single invoicing lines. This is also an important capability when it comes to data analysis, simulation, and planning phases.
6. Self-service capability:
For a platform to reach its full potential, it should enable anyone involved to quickly understand the insights needed to make data-driven decisions at any stage and should allow them to perform their own what-if scenario modelling. There should also be embedded predictive analytics to provide business users with immediate feedback on their course of action without having to rely on data scientists, programmers or additional tools.
7. Data transparency:
The platform needs to provide complete visibility into planning, simulation, and forecasting across the whole organisation, including different departments, hierarchical levels, and information systems. This, of course, requires a platform with live connections to ERP solutions, data warehouses, payroll, CRM, expense management, and other financial and operational applications. The platform should also allow users to drill down to the source data to allow self-service analysis and confidence in the accuracy of the numbers.
8. An ability to clearly define, calculate, and represent KPIs:
It should be possible to cascade metrics throughout the organisation, such as splitting a profitability goal into a cost-per-lead objective for marketing and a discount target for sales. These metrics should have owners and should be built into their dashboards, forecasts and what-if scenario models so that they can become accountable for their decisions.
9. Embedded workflows:
Each process undertaken should be guided through a chosen path, including approvals, with complete visibility of the status at all times to aid transparency.
10. Scenario Planning and Modelling capabilities:
While the CFO can certainly lead the scenario planning and modelling process, they won't be successful in doing this alone. This effort needs to connect leaders from across the organisation. Scenario planning typically requires access to aggregated data, going well beyond finance. To create better, more accurate models, finance needs historical and comparative sales and operations data, headcount and expected growth, and of course, actuals from the general ledger.
A holistic view of the business
If the right decision-making platform is chosen, a CFO will have the support they need to make accurate, optimal and informed decisions about all business functions.
This, in turn, will mean they are well placed to focus on long-term business goals because they will be able to analyse, simulate, plan, and predict from a single platform.
Smart business strategies are never developed in a vacuum, and a decision-making platform should also support a collaborative process that brings together the data and the people to make the best choices possible.
Consider how a decision-making platform could revolutionise your organisation.