According to a global survey Tagetik carried out with our customers last year, a full 70% of corporate finance teams still rely heavily on spreadsheets. This figure is not surprising, as most clients are either implementing Tagetik solutions to replace spreadsheets or legacy corporate performance management (CPM) systems. On the other hand, it’s impossible to get a holistic view of a business using spreadsheets, and poor visibility creates business risk.
If spreadsheets have such a bad reputation, why do companies cling to them when there are so many alternatives out there? I considered what people seem to value about spreadsheets:
- Total transparency: Even though spreadsheets are a terrible way to present data – and are often based on bad data – at least it’s easy to see the data and exactly how figures are calculated.
- Easy access: Practically every corporate user gets a copy of Excel or Google Docs to be able to develop a spreadsheet.
- Ease of use: Most people can do spreadsheet basics (though few people use spreadsheets to their full potential).
Given all the known cons of spreadsheets, these pros obviously carry considerable weight. We knew at Tagetik that the only way to wean finance teams off spreadsheets was to offer them similar pros of the spreadsheet experience, in terms of transparency and usability, while eliminating the long list of cons. The cons we heard from many customers include high maintenance overhead, significant time spent by expensive finance resources performing manual input rather than real value-add, poor data management, no data integration nor Big Data support, and sub-par system performance and deployment options.
With an eye toward the growing amounts and types of data used in finance, we decided to partner our CPM application with a Big Data and analytics platform. Here are the top five benefits corporate finance teams are gaining through the partnership:
1. Data unification and “one version of truth”
As our comprehensive CPM system is integrated with an analytics platform, corporate finance teams get automated management reporting, analytics, and disclosure reporting through a single source. This unified approach makes it easy to modify finance systems and processes to keep pace with ongoing change in the business, while helping to keep total cost of ownership down.
2. Threefold performance increase
Integrating with an analytics platform gave our CPM software a threefold performance boost without any fine-tuning. This is a tremendous benefit for finance departments, where processes can take hours with other technologies. Finance teams benefit from faster, more efficient reporting. Time spent on planning cycles and the close process has been reduced by 70% and 50% respectively.
3. More time for strategic work
Cutting planning time frees people up for analysis and strategic tasks, and also provides greater flexibility. For example, being able to do faster consolidation gives teams time to handle multiple reconsolidations before publishing final results. Equally, faster allocation processing makes it possible to run sophisticated what-if simulations during budgeting and forecasting cycles.
4. Lower data-integration costs
By automating the process of connecting CPM to analytics, we’ve cut integration costs up to 30% while providing a simple “business layer” for finance users that includes single sign-on and streamlined access to finance information.
5. Unified data harnessed for deeper insight
Unified data lets finance teams explore data at a granular level to support better business decisions. CFOs can work with real-time data and gain deeper visibility into corporate performance metrics. At the same time, the analytics platform combines external data with unified internal data to conduct sophisticated benchmarking exercises that provide insight into finance processes and business performance. The ability to run industry-specific applications on one platform means that companies in banking and insurance, for example, can use Big Data capabilities to help ensure compliance with evolving regulations.
By matching the pros and overcoming the cons of spreadsheets, we are finally offering corporate finance teams a viable, robust alternative that helps them free up time and resources, improve the quality of their reporting, and significantly reduce business risk. This will allow the office of finance to finally take control of its own data destiny by extracting operational raw data at a very granular level. That allows them to transform it into information and use that information to drive valuable insights, having full control and governing the entire data lifecycle.
In other words, there is no need for the CFO to rely on different products and separate data warehouses. Instead, they can support their new and developing needs in a single, easy-to-use, unified platform governed by finance – optimized at using data as a strategic asset to drive a “data dividend.”
Get more insight on modernizing your finance operations by “Replacing Spreadsheets With An Intelligent FP&A Solution.”