Skip to main content

Success pill for the CFO of a mid-sized business

By
3 steps to improve financial performance management 

Large organisations benefit from higher investments and adherence to systems, processes and controls. Small businesses have shorter command chains and thereby higher transparency and control. Mid-sized businesses lie somewhere in between. The complexity of their business is rapidly increasing, and systems that may have been appropriate for a smaller organisation are no longer adequate. While most mid-sized organisations acknowledge this problem, they don’t necessarily know how to get themselves out of it.
Setting up the required systems, controls and processes for monitoring the financial and business health of a mid-sized business is not just important, it is mandatory.
Step 1: Identify your measures for business success
While the broad aspects of financial performance management remain the same across organisations, it is important to understand what sets your business apart, and define the measures accordingly. A service organisation measures profitability by project while manufacturing units look at profitability by product. In a service organisation, keeping employee costs under check and maximizing employee utilization are most critical. For a manufacturing company, inventory & cost management are essential. Take your time and define the measures carefully. Your measuring initiatives will only be successful if you can keep it simple. Try and define meaningful measures that can be easily tracked and reported.

Step 2: Fix your data source

Your output is as good as your input. Don’t start replacing your tap if your drain is clogged. Audit the quality of your input data (both financial and non-financial). If you want to look at project-wise profitability, you need to capture project information at the time of booking your costs and revenues. If you do not have in-house expertise, get a good consultant to fix, clean and restructure your source data. A good accounting firm can quickly restructure and clean your accounting data. Similarly, a good business analyst can fix your operational data.

Step 3: Measure & Report

If you can’t measure, you can’t fix. Performance management measures are fairly useless if you have no way to measure and report them. It is also important to determine the correct frequency for reporting. A good measurement and reporting tool is invaluable in your performance management efforts. With the advent of cloud computing, technology has become ubiquitous. High quality tools are now available at a fraction of the cost. Affordable financial performance management and BI tools are accessible to businesses of all sizes. Choose a tool that can be configured for your local requirements. Business user friendly packaged solutions are better for mid-sized businesses than platforms that need extensive customization before usage. Make sure the tool you choose can be managed and maintained by business users without having to depend on in-house or vendor IT teams for any changes in reporting requirements.


To know more, visit: https://finalyzer.beyondsquare.com










Labels:

Comments

Post a Comment

Popular posts from this blog

FinAlyzer, a flagship product of BeyondSquare Solutions, was featured on My Startup TV, India’s first channel for Startups.

By
We are glad to share that FinAlyzer, a flagship platform of BeyondSquare Solutions was selected by NASSCOM, among the Top 50 Startups and MSMEs for its first global virtual event NASTech 2020. Karthik Ganeshan, Director & Co-Founder of BeyondSquare Solutions featured in My Startup TV, India’s first channel for Startups. As stated by Karthik Ganeshan, he and his partners who are all ex-Infoscions had a deep desire to contribute to the Digital Transformation and thus co-founded BeyondSquare Solutions. FinAlyzer is a unified digital platform for Financial Consolidation, Close, Analytics, and Management Reporting. FinAlyzer is a key catalyst driving Digital Transformation for all the CFOs across industry segments. We are grateful to Major Sunil Shetty (My Startup TV) for hosting us on its media channel and the NASSCOM team who provided us a platform to showcase FinAlyzer.
Post a Comment
Read more

Top 5 Financial KPIs for the CXO

By
Let’s say you got up this morning with a headache. You know from experience that it’s a small niggle, and it will go away on its own. But what if you got up tomorrow morning, and the headache got worse? If an aspirin doesn't help, you will surely go to a doctor, and most likely get some diagnostic checks done. A KPI (key performance indicators) dashboard is like a diagnostics report of various parameters that reflect the health of your business. KPI’s help you measure your business’s financial health. You can define KPIs for different areas of your business, from HR, Finance, Marketing to Operations. You can combine these KPIs to arrive at an overall health for your business. The Finance function is like the blood flowing through your body; it affects each part of it and keeps it healthy and oxygenated. Similarly, your company’s financial performance has a direct impact on every aspect of your business. Remember, that KPI’s and dashboards are not just for CFO’s...
Post a Comment
Read more

5 Things to Consider Before Investing in a Financial Consolidation Software

By
  In a recent conversation, the Chief Accounting Officer of India’s largest private enterprise mentioned that a good financial consolidation software would be of great service to the accounting community. His statement implying indirectly that in his many years of managing accounting for an extraordinarily large and complex organisation, he has still not come across a suitable enterprise platform for consolidation. It is but natural to assume that organizations would rid themselves of long days of manual financial consolidation and labour-intensive management and statutory reporting. The practice of being strapped to one’s chair and spending long hours into these activities must be shunned. Instead, quality time should be spent on analysis and decision making. Before you dive in to avail the perks of a financial consolidation software, it is crucial to know what to expect from the software. While there are many choices, one must exercise prudence in selecting the one that furth...
Post a Comment
Read more