The vast majority of Canadian organizations still rely on spreadsheets as their primary tool for business analytics, which may be leaving them at a competitive disadvantage. This is one of the major findings of a new study by CFERF, the Canadian Financial Executives Research Foundation, the research foundation of FEI Canada, and sponsored by SAP Canada Inc.
The survey of 118 senior Canadian financial executives was carried out to discover which data analysis tools Canadian organizations are using today, their level of satisfaction with those tools, and the level of data integration within organizations. The study found:
- 79% of executives feel their current financial reporting and analytics tools only somewhat meet their business’s needs.
- 65% of businesses do not use or have no access to real-time reporting tools.
- Only 4% of executives consider themselves industry leaders in financial reporting.
- Only 29% have plans to invest in financial reporting and analytics infrastructure this year.
- If only one aspect of financial reporting and analytics could be improved, 27% of respondents want more advanced analytics (the highest-ranked response).
Over-reliance on spreadsheets is symptomatic of broken systems, characterized by offline processes, redundant data, and wasted human effort in data entry and reconciliations. Today, when terabytes of data can be analyzed in seconds and accessed in real time on tablets and smartphones, it makes little sense to rely on static spreadsheets as analytical tools.
CFOs are responsible for maintaining controls over the accuracy of financial information. In addition to providing live information, integrated business intelligence tools help to safeguard system data as the single source of financial truth.
The CFERF study reported statistics by company size and found that 91% of small businesses (<100 employees) and 76% of midsize businesses (101 to 500 employees) predominantly use spreadsheets for business analysis. That proportion, however, declined to 50% for organizations with more than C$1B in revenue.
The CFERF study includes commentary from CFOs and other senior financial executives in Toronto, Calgary, and Montreal, who attended a roundtable discussion on the opportunities available to improve their ability to derive insights from data.
“This continued dependence on spreadsheets today may be indicative of a lack of resources holding CFOs back from fully developing their data analytics capabilities,” said Michael Conway, president and CEO, FEI Canada. “Demands on businesses are extensive and growing, and real-time analytics can help with tasks such as forecasting performance, market research, profit margin analysis, risk assessment and management, operations, and product pricing.”
He added that the problem with spreadsheets is that the information is often not timely or intrinsically insightful. Larger companies are embracing live analysis and moving away from spreadsheets at a faster rate than small to midsize businesses. However, it seems that most businesses have yet to eradicate the problem of disparate and static data sets, which interrupts operations, adds unnecessary confusion, and often requires manual reconciliations.
Niall Cotter, CFO, Kingsdale Shareholder Services, commented on the benefits of business analytics tools that his organization uses. “In a business intelligence report, I can almost flick over all the various areas that I want to see. If I want to view metrics by campaign, by person, by graph, or whatever, I can do it without having to go to separate tabs. It’s all there, it’s in real time, and I find that very powerful.”
Click here to read the full FEI Canada research report titled Data Analytics in Canada.
To continue the discussion on the evolution of business analytics tools, and how CFOs can drive the use of comprehensive automation to improve, simplify, and completely rethink back-office operations, read Digital Finance: Transforming Finance for the Digital Economy. Learn more about how CFOs can drive the use of comprehensive automation to improve, simplify, and completely rethink back-office operations, leverage business networks, and speed up decision making.