Businesses generate staggering amounts of operational and financial data that give their leaders an insight into the health and performance of the company. Unfortunately, half of US businesses still fail to view their data as a business asset. Without a full, data-driven understanding of the health and performance of the organization, managers and business leaders often lose their ability to conduct business planning based on facts generated from comprehensive financial and operational data.
Here are some reasons companies consistently fail to take a holistic approach to business planning and performance evaluation.
Behind the struggle to maintain consistently high company performance without holistic business planning
Financial perspectives are limited due to fragmented data storage across departments
As business models become more complex, information silos continue to be deeply entrenched in the culture of many organizations. To meet customer demand, operational teams use a variety of collaboration and communication tools to collect and analyze information. A recent study showed that business teams use approximately six collaboration tools and four communication tools at any given time. The separation of data collection and analysis tools can create blind spots that may result in financial losses or inaccurate cash flow predictions. This makes it difficult for financial leaders to receive an accurate and holistic view of each department’s current and predicted performance. To overcome this challenge, business leaders must cultivate a culture of intra-company collaboration within their organization and provide tools that are aligned with the culture they wish to create.
Employees continue to feel disengaged at the workplace
Employees are a crucial resource for any organization and are usually tasked with executing strategies that are designed in boardrooms. While companies can engineer short bursts of high performance with new products and initiatives, sustaining high levels of performance is impossible without an engaged and motivated set of employees.
Despite their importance, a recent Gallup poll still found that over half of all US employees consider themselves disengaged at work. This lack of engagement can cause high levels of turnover and reduce productivity at the workplace. To change this, companies must find a way to align the needs of the employee with the needs of the business and encourage communication between the two stakeholders.
3 ways to gain a 360-degree view of company performance
Eliminate silos and bring finance closer to other operational departments
Silos remain the largest organizational barrier to a holistic financial perspective. Finance teams, in particular, tend to exist as separate entities from the rest of the business. Considering the impact that financial insights have on company decisions and performance levels, bridges must be built between finance and operational teams. The elimination of silos is a challenge that businesses attempt to overcome with cohesion activities and company-wide meetings. However, these initiatives often only work if employees can leverage and build on these relationships in their daily work lives.
With integrated software, business leaders can connect finance and operations teams using the tools they already have. Divergent communication and information sharing tools can be brought together to provide an avenue for teams to connect regularly without the need for in-person meetings or confusing email chains. This reduces the friction between teams and provides companies a basis on which to build a culture around collaboration and information sharing.
Improve intra-company data sharing to allow disparate pieces of information to be pieced together
Silos also present a challenge for business leaders who wish to collect and analyze operational and financial information to design and implement long-term business plans. However, such business planning is often done by managers and executives who rely on individual teams to share the information that they believe is most relevant for decision-making. This approach fails to recognize the role that fringe data and inter-connected data have in determining company performance; instead placing the burden of categorizing and organizing critical business data on the shoulders of individual team members.
For instance, HR policies have a direct impact on the ability of finance teams to allocate bonuses and plan investments. To close this gap, business leaders can use modern technology that combines information from multiple sources without adding an additional layer of “copying and pasting.” An integrated financial planning platform works with storage solutions and communication platforms that are already being used within those teams.
Democratize access to insights and reports using strategic financial planning platforms
Sharing financial information in an easy-to-understand manner is the natural progression for companies that have overcome the hurdle of collecting and analyzing performance data from disparate departments within the company. While employees are often given high-level access to financial and operational data, this information is usually unstructured and unorganized. The insights gathered from this data are regularly presented in board meetings by data analysts hired by executives, thereby excluding ground-level and mid-level employees from accessing such information.
With employees continuing to feel disengaged and managers being 11% more likely to be informed of a company’s financial performance compared to a regular employee, it is high time that performance information is shared with employees at all levels. With software that can graphically represent holistic financial performance intuitively, business leaders can make business insights more accessible and democratic. Such programs ensure that employees feel invested in the performance of the company and as a result, are willing to invest more effort in achieving the collective goals of the organization.
Ultimately, business leaders can only maintain high levels of company performance when information gaps are closed, data sharing becomes the norm, and corporate culture surrounding information access evolves. Integrated software is key to achieving this.
To learn more about how businesses can use technology to conduct financial forecasting and achieve a more holistic view of company performance, schedule a demo with us today!