The Importance of Data Management for Finance Professionals’ Success
Corporate finance teams have long outgrown the traditional roles of simply balancing books and budgets as they have taken on more analytical strategic management tasks. Their experience and insight into the market and their company give finance leaders an advantageous position in looking at how best to steer the company to evolve and meet new corporate challenges.
Successful finance leaders need to be proactive and make well-informed decisions under pressure. In order to do that, they need access to accurate, real-time data; something that is difficult to achieve in the fast-paced corporate world. Often, the data mining involved in gathering information can be considerably lengthy. The globalisation of modern business means important data can potentially be stored on a desktop on the other side of the world. Finding the time to chase up necessary information, such as lease schedules or invoices, can be tedious and complicated, particularly when we are reliant on others to find the time to search, filter and then forward the data to us.
Easier said than done
Unfortunately, gathering the data is only half of the battle for productive decision making. In order to facilitate fast, efficient solutions, finance leaders need to be able to analyse and review the data swiftly. They are reliant on the accuracy of the data as false or out-dated information can result in numerous costly repercussions. It is not just the accuracy of the data that could lead to such consequences either, but also its validity. For the most competent decisions to be made, finance leaders require the most up-to-date data; the sooner they receive the data, the more likely it is to reflect on the true figures and therefore the more relevant and reliable the decisions formed. Without effective data management systems in place, figures can very quickly become outdated, especially in high pressure financial scenarios. This becomes an even more complex task when there are multiple edits and versions of reports and documents to decipher between; how can you confidently know which version is the most accurate?
One common example of this occurs within organisations’ lease management. The end of the lease is a highly time sensitive aspect of the leasing process as companies that lease need to notify their lessors within plenty of time. Failure to do so can result in extended leases at the primary rate, breaches of contract and high penalty charges. It is for this reason that managers within procurement and finance teams need a system that gives them the information they need on their active leases as soon as they request it. They need to be able to analyse the data to make an informed decision on whether to extend the lease, terminate the agreement or negotiate another end of lease option. Without access to financial reports and operational data on their leases and assets, there is a chance that an effective decision will not be made before then end of lease notice deadline.
There are numerous processes within business, both time-sensitive and not, that can be greatly improved through the implementation of intuitive data management software. Intuitive dashboards and instant, customisable reporting tools allow data to be collected and visualised in just a few seconds, significantly reducing the time spent manually mining for data. As important information can be accessed globally 24/7, having your data stored in a secure database means data management becomes a much easier and more productive task.
For example, our cloud-based lease portfolio management software, LOIS, allows Innervision customers to keep all their important lease data and documentation in one place. When it comes to running end of year lease reports, cost savings reviews or even analysing IFRS lease accounting compliance, our customers have immediate and accurate access to the data they need, allowing them to make the necessary actions and generally become more proactive and efficient in their lease management. This speed and simplicity considerably reduces internal processing tasks, provides numerous savings opportunities and generally improves productivity, accuracy and speed of these traditionally manual and therefore time-consuming tasks.
Successful finance leaders are realising the benefits of digitalising their data management processes as trends and challenges within their markets have outgrown the traditional spreadsheet based, predominantly manual processes of handling important information. As the roles of corporate finance teams continue to evolve, they have needed to become pioneers of technology, adapting the new pressures within business through the adoption of cloud-based software as a service platforms. Research conducted by Oracle found that more than two-thirds of finance executives claim to have either already adopted cloud-based systems in some part for their organisation for core financials, or are planning a roadmap for doing so, highlighting the pioneering impact digitalised systems have had on the evolution of the finance professional into a more strategic advisory role.
In the time it takes for a significantly manual data gathering process to take place, much of the data that was once relevant and accurate is no longer in date. In many cases, this can lead to misleading figures and ill-informed decisions, both of which can be costly and time consuming to correct. With numerous upcoming financial challenges, such as the announcement of a new global lease accounting standard, it is this new breed of finance professionals who realise the importance of efficient data management and distribution processes that are likely to succeed and thrive as markets develop.
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