Frustrated with your current slow, mundane, and error-prone process? Thinking of leveraging on a finance software solution for your group finance team? Financial Performance Management (FPM) solutions may do the trick. With a powerful FPM tool, you will be able to resolve current challenges and super-charge your finance team for future projects.
In this article, we have gathered four key reasons why FPM software is a great investment for your group finance team, and the proven benefits FPM software has brought.
This post serves as part three of our Why FPM? series. Have you already read the first blog post on the advantages of integrating your financial processes? Did you read the second blog post, which answers the question why you should speed up your financial processes with an FPM software? If not, take a look here:
- Why FPM (1/6): 4 reasons why you should integrate your financial processes
- Why FPM (2/6): Speed up your Financial Processes with an FPM Software
1. Reach deadlines easier and faster
The nature of finance requires gathering financial data and running necessary calculations in accordance with accounting rules. Due to that, most finance professionals spend their day copying and pasting numbers across multiple spreadsheets. Having to do this multiple times for monthly, quarterly, and annual reporting results in repetitive and mundane work. However, these are still necessary tasks to complete in order to successfully deliver financial reports. McKinsey estimates that in about 60% of occupations, at least one-third of the constituent activities could be automated. That applies to group finance teams as well.
With an FPM solution in place, the software does all the copying and pasting for you. Your FPM solution will be able to put all your financial data in the right places and automate financial calculations based on various international accounting standards.
One example would be the finance team at Thai Union. Thai Union has leveraged on LucaNet’s FPM software to meet their deadlines. As explained by their Head of Finance IT, Gion Pfuetzner, "We used to need 25 days to complete our monthly reports. With LucaNet, we can finish the whole process within 10 days, including consolidation... LucaNet has given us the perfect tools to execute a fast close and quickly provide our stakeholders with the financial data they need". Reaching deadlines is no longer a struggle for the finance team at Thai Union with the help of FPM software.
2. Gain full visibility of your company’s performance
Another key benefit cited by users of FPM solution is that FPM software can improve data connectivity, allowing group finance leaders to gain full visibility of the company’s performance.
Group finance teams are often at the mercy of their subsidiaries in terms of collecting financial data. Having to collect reporting packages from across multiple regions, which causes delays in the finance process and limited visibility on the performance of individual subsidiaries. It is also common for subsidiaries in different geographies to rely on different ERP systems.
Hence, the role of an FPM solution is to extract all of these financial data straight from the ERP systems with the ability to drill down on individual transactions to fully understand the postings. An FPM solution like LucaNet uses the Extract-Transform-Load (ETL) technology to retrieve, transform, and group these financial numbers.
The finance team at Rocket Internet chose LucaNet to improve visibility on the performance of their portfolio of companies. "We have hundreds of companies spread across several subgroups to consolidate. You can't do this in Excel without getting any errors. LucaNet makes it possible for you to prepare consolidated financial statements reliably in accordance with different accounting standards” as mentioned by Paul Stander, Head of Group Accounting National at Rocket Internet. Now, the stakeholders can gain greater and more timely transparency on the hundreds of companies under one roof.
3. Scale your finance department with the business
Other than resolving current challenges, it is also important for finance leaders to think about how FPM investments can benefit them in the long run. A key future benefit CFOs can stand to gain from FPM solutions is the ability to scale their finance team without hiring.
As businesses grow, the team often grows in parallel. One questions finance leaders should think about is, does throwing in an additional headcount really help to gear up the team for more work that is to come? Costs such as recruiting, salary, benefits, taxes, training, and time are involved when adding new team members. If work is still done in the same manner, adding an additional member to the team is like adding an extra runner in a relay race. It does not guarantee better results.
Utilizing FPM software fundamentally changes the way work is done in the finance department. As the company scales up, the FPM solution handles the increase in financial data with ease. One of our clients, Astroscale, was able to set up a full self-serviceable consolidation process for a lean team of only 2 users. This allowed Astroscale to do more with consolidation and reporting while enjoying 80% in cost savings.
4. Setting a good foundation for financial analytics and business intelligence
Business Intelligence (BI) and analytics are all the craze right now. With powerful visualization tools, businesses are fully equipped to make data-driven decisions. Having an FPM solution ensures accuracy and completeness of your financial data – which are key components to a meaningful analytics roadmap.
We cannot stress the importance of having the right data before jumping into BI enough. As the saying goes, rubbish-in, rubbish-out. Finance teams should ensure that they are setting the right foundation in terms of financial data cleanliness. With an FPM solution, data validation can be conducted easily, creating the right building blocks for better analytics.
Investing in an FPM solution pays off now
Adopting the right solution will provide benefits to your organization for now and in the future. LucaNet is an award-winning and world-class FPM solution that is well-loved by 3000 customers worldwide. For more information on the benefits that our software can provide, visit our solutions page:
In the upcoming blog post of the series Why FPM? we will talk about how to make financial processes more reliable. Stay tuned!
A disconnected finance management process causes plenty of frustrations for finance teams. Here are our top 4 reasons why the integration of financial processes and systems should be a top priority.