Business intelligence (BI) tools are part of the furniture in many organisations, especially when it comes to sharing and visualising data.
While BI tools serve many lines of business well and have their obvious merits, they often don’t hit the mark in finance. Finance teams’ reporting needs are too specialised for modern BI tools, so finance needs something different.
After a BI implementation, finance teams often learn the hard way – as if they’re in a bizarre, never-ending spiral. Teams realise there are critical capabilities that their BI software is unable to support, which eventually leads them down an endless path of dumping static data from their enterprise resource planning (ERP) into spreadsheets for manual manipulation.
If this sounds like a familiar situation, you’d better read on…
We can take a look at multiple scenarios where BI software falls down, leaving finance teams pulling their hair out in frustration. Here are some examples:
To get the best out of their BI tools, businesses often call in the IT team to set up a data warehouse to transform their data into a structure more suited to reporting.
But this does not solve the problem for finance, either.
A data warehouse typically holds summarised data, which breaks the link to the underlying ERP transactions. This means there is no way for finance to drill into detailed transactional data to investigate and resolve reconciliation or integrity issues.
As the data warehouse is updated only periodically, it introduces a time lag between data entering the ERP and the same data flowing into the warehouse. This lack of real-time visibility hits finance hard at period-end – a time when the team relies on the most current data to handle reconciliations and consolidations, validate adjustments, and produce financial statements. For finance, delays like this are unacceptable.
Finance teams then begin to lose patience and resort to pulling data manually from their ERP, dumping it into Excel and manipulating it into the format they need. This is a long, arduous, and error-prone process, which is compounded considering the investment made in the BI tool. And, even worse, finance teams find themselves working with static data that is no longer connected to the ERP. As new journals are posted or adjustment entries are made, the data in the report rapidly becomes out of date. So, it’s back to dumping data from the ERP and repeating the whole process – a seemingly never-ending cycle.
To avoid this spiral cycle, you need to close the financial reporting gap that the BI tools create. Here are some key things to consider:
Finance teams need to break free from this reporting spiral – a never-ending cycle living in the shadow of BI tools foisted on finance just because they work well for other departments. It’s time to recognise the unique reporting needs of the finance team and create a reporting strategy that’s fit-for-purpose for a modern business to make quick decisions.