For CFOs, finance leaders and financial professionals worldwide, sharing and working with data is a key challenge.
In any growing company, sharing data between departments can be a pain, regardless of whether you sell physical products or software services.
You must collaborate with other departments in both examples to get a complete picture of your performance. If your finance team only has access to financial data, that’ll limit what they can do.
How can you collaborate with other teams to share information in driving the business forward? Let’s dive in and find out.
Five data-sharing challenges (and how to overcome them)
You want to share data with other departments, but there are hurdles to overcome (which you may have already faced).
- Data quality
Data shared with other departments should be accurate, reliable, and up-to-date. Ensuring data quality can be a significant challenge, especially if data comes from multiple sources or you have data silos.
- Data security
CFOs are responsible for ensuring that sensitive financial data is protected. Sharing this data with other departments could increase the risk of a data breach, which can have serious consequences.
Common communication methods, such as email, might not have adequate data security features, such as encryption, access control, or audit trails. You don’t want any unauthorized access of sensitive data.
- Technical compatibility
Different departments may use different software or systems, making sharing data difficult. Importing, exporting, synchronizing, or automating data processing may be difficult.
You may have to think about investing in technology that enables different systems to communicate with each other.
- Data overload
With so much data available, it can be difficult to determine what data is relevant and useful for other departments. It may be on you to identify the most critical data that will help other departments make informed decisions.
- Communication barriers
Apps like Microsoft Teams and Slack are great for everyday collaboration but not so good if you want to handle complex data—they are typically designed to handle only a limited number of input fields, such as name, email address, and message.
“Chat apps and community functions are great for bringing work groups together but don’t address data inputs. People still must gather the information they share, which may be outdated,” says Scott Freedman, Director of Marketing at Sage Intacct.
How financial management software can help
Financial management software is essential to digital transformation and potentially the solution to those data challenges.
In a world where data is the new currency, having a way to share and collaborate on this data in real-time can help you make the most of your assets by streamlining operations and improving overall efficiency.
With financial management, you can automate processes and eliminate manual tasks so that your employees can spend less time collecting and analyzing data and more time acting on it.
This increased efficiency means you can collect and act on more accurate data sooner. This allows you to maximize the value of your resources and achieve your goals more quickly than ever.
Clare Bowen is a Director at Monahans, a leading accountancy and business advisory firm.
She says, “You can use up-to-date information to fuel modelling tools that play out scenarios for the future of your business. If you’re taking on a new project, how many staff will you need, and can you afford to pay them?
“Having real-time data lessens the chances of you getting caught by surprise. It allows you to be proactive and respond to situations as and when they happen.
“In contrast, if you don’t understand your financial position, you’re limiting your options and even risking exacerbating issues further when the crunch time comes to make decisions.”
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One source of truth
Financial management software plays a critical role in facilitating data sharing and collaboration. However, for your organization to have genuinely useful real-time data, you need “one single source of truth.”
Real-time data needs one source of truth to ensure everyone in your business makes decisions based on the same data. It’s important because it lets you make decisions quickly and accurately without worrying about conflicting data points.
A single source of truth also helps to reduce the risk of errors and inconsistencies in data, as well as the time it takes to reconcile different versions of the same data set.
By using a centralized platform for financial data management, you can ensure that everybody can access the same information, regardless of their location or department. You won’t need to work with data manually, which can be time-consuming, error-prone, and potentially lead to inaccurate insight.
Financial management software integrated with data-sharing collaboration tools allows different departments to easily share and collaborate on financial data in real-time. This can improve communication, reduce errors, and speed up decision-making.
For example, a finance team could collaborate with sales and marketing teams to analyze the impact of marketing campaigns on revenue using real-time data from financial management software.
Having one source of truth can also ensure that their data is up-to-date and accurate.
Dylan Connerton, VP of Product at Sage Intacct customer Forecast, says having one source of truth regarding data is necessary to provide businesses with the required insight.
He says: “It’s the ability to connect lots of different data sets to understand how decisions you make in one area can trade off against another. That provides very useful insight.
“Offering people the ability to connect many different data sources to understand how they impact each other is where things start.”
Unleash the power of dashboards and data visualization
Dashboards are a great way to present financial information in an easy-to-understand format.
The more data you have, the more difficult it is to interpret and decide based on it. With dashboards, you can organize your data in a way that helps you understand what’s going on and what you need to do.
Dashboards also help non-financial employees better understand what’s happening in the company. They can see how much money is coming in and going out, where it’s going and why, and how they can help contribute to its success.
This helps your people feel more connected with top-line goals—and makes them happier at work!
Empower your employees with data-driven insights
When you empower your employees with data-driven insights, the benefits are immediate and far-reaching.
You can use data analytics to examine processes and business results and then share that information with employees in a way that is helpful for them to make informed decisions about their roles.
For example, a finance manager might be able to see the most popular products over time, which could help inform future purchases or promotions.
A salesperson might be able to see where customers are coming from, which could help them plan what to do next to take advantage.
Data-driven insights help you make informed decisions based on sound data—instead of just hunches or assumptions. And if employees feel you and the technology support them, they’ll feel more confident in their decision-making.
It’ll help you make smarter choices about the future direction of your business, including where you should invest in growth opportunities or cut back on unnecessary costs such as rent payments on office space that is sitting empty most of the year.
Sarah Platt, Founder and Finance Partner at Firehaus, says: “In business, you have a lot of decisions to make, and this can overwhelm you. Having sound financial information at your fingertips can relieve much decision-making stress.”
“You can go with a strong ‘gut feel’ if financial data backs it up. Ideally, a combination of historical figures from management accounts and future-looking figures from forecasts and budgets is a sound way of confidently making decisions.
“The data may even challenge that ‘gut feel’ and prevent you from making a bad decision through lack of insight and analysis.”
Final thoughts on making better decisions
Financial management software plays a critical role in facilitating data sharing and collaboration. But to do that effectively, you need a single source of truth to ensure everyone in the organization makes decisions based on the same data.
Additionally, dashboards and data visualization tools can help present financial information in an easy-to-understand format. Empower your employees with data-driven insights; you’ll see them make better-informed decisions and drive greater business success.
By prioritizing clear communication, data accuracy, and a culture of collaboration and transparency, you can effectively manage your data, making more informed decisions for a brighter future.
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