Business reporting is an essential part of your operation. You need clear numbers to tell the story of how the company is faring. Financial software takes the data collected from your ERP to give you clear and powerful stories that all stakeholders can understand.
Business Reporting Includes Numbers in the Story
Successfully using financial software to build numbers-based stories relies on the following strategies:
- Financially literate: Understanding what the numbers on each of the reports generated from your ERP system are telling you about aspects of your business.
- Visual prompts: Using various business storytelling techniques: In addition to crafting a narrative around beginnings, middles, and ends, there are other ways to craft a business story. For example, some storytellers use written narratives (novels) while visual storytellers use film (movies). You’ll need to choose your storytelling vehicle carefully, whether it includes reports, graphs and data visualizations, or narratives.
- Up-to-date figures: You can know what a balance statement means and how to interpret it correctly, choose the right charts and graphs, and build your story, but if you’re using outdated or inaccurate information, you could be telling the wrong story.
Most managers have rudimentary financial literacy and, of course, finance and accounting professionals are well “read” in the field of finances. A financially literate person understands what information can be obtained from each of the major financial reports: the balance sheet, the income statement, sales reports, and inventory and warehouse reports.
Let’s use as an example a personnel manager for a manufacturing operation. A personnel manager may not know all the nuances of manufacturing products, but if they are financially literate and can “read” the data from the financial software, they can see that a dramatic increase in sales across all channels may mean the need for additional personnel. The numbers, in this case, tell the story that sales are increasing (the hero) and, for the company to continue being profitable (the quest), they need to proactively address pending staffing challenges that may arise during the next quarter (the villain). By understanding the story inherent in the data, the personnel manager may read and interpret the financial data and suggest a course of action based upon these findings that can benefit the company.
Next, to tell your story, you need to choose your medium. Writers use words, painters use paint, and filmmakers use videos to tell their stories. You must choose the appropriate business medium to tell your data-based story.
Some suggestions include:
- A written report, such as a memo or one-page summary of findings
- A presentation at a meeting, such as a slide show
- Data visualizations such as charts and graphs
Each has its place in the business environment, but to tell engaging, compelling, and easily understood numbers-based stories, the best way is usually through charts, graphs, and other data visualizations. In fact, many people rely upon these methods as the primary storytelling vehicle. Then, they use them as part of a written report, or a presentation given to others to help make their points intelligible by the average viewer.
To continue our example of the personnel manager at the manufacturing company, perhaps the manager has run the overall balance sheet and sees that sales are up across all channels: retail stores, e-commerce, and distribution partners. He chooses a simple pie chart to show the percent of orders from each channel. Then, he uses a line graph to show year-to-year sales increases. It’s easy to see the steep increase for the current year using a line graph and, in this quick picture, he has just made his point: with sales so brisk, the company is likely to need more staff to handle manufacturing increases and order fulfillment.
Lastly, your financial storytelling adventures rely upon accurate data. That’s where financial software, otherwise known as your enterprise resource planning (ERP) system, comes into the picture.
Cloud-based ERP systems provide real-time data and insights that can lead to powerful strategies. The more recent the data, the better your financial storytelling will be, since it’s a story with immediate impact. Older data, while it can tell historical stories, must be updated to provide accurate information on the current situation.
If the numbers-based story contained in your ERP system doesn’t look right, or your colleagues are saying your story is inaccurate, it’s time to investigate.
- Is the system capturing the correct data? If not, you may need to investigate further to understand why the information is incorrect. Has anything changed in the system that could be throwing off data collection accuracy?
- Is it updating it frequently? Older systems and on-premises systems may not update as frequently as cloud systems. It may be time to consider shifting to cloud-based ERP as real-time data is essential for a competitive advantage for your company.
- Are any parts of the “story” missing? For example, if your ERP captures data from every aspect of the company except the warehouse because the warehouse still uses spreadsheets and manual scratch counts, it may be time to update the inventory management software.
The right business intelligence can make all the difference in how you interpret the financial story. Accuracy is of paramount importance.
Are you wondering what data should be included in your story? Check out this on-demand webinar by SYSPRO: KPIs—Measuring Your Companies Vital Signs to Have it Stay Healthy.
Consider Your Audience
All good storytellers consider their audience when they craft their tales. A story written for marketing professionals may tell quite a different tale from a story written for the CEO. Consider who is listening to the story and what they wish to get from it.
- CEOs and other top managers usually want to know the bottom line They want storytellers to make their point quickly and to provide them with the big picture, a few insights, and action steps. They usually do not have the time, patience, or need to hear the details, but prefer a high-level overview.
- Middle managers, on the other hand, may prefer the details, since often they rely on details to do their jobs better. A report for middle managers must focus on items of concern to them and on the information they need to act.
Use Financial Software for Accurate Business Reporting
Financial software is an effective tool for accurate business reporting. Its unique way of storytelling improves your ability to share important facts with executives and the rest of your team. However, if your current financial software isn’t current or you don’t have the right technological tools to convey your message, you’ll lose your audience.
There is no time like the present to update your company’s ERP. If you switch to a cloud-based system or upgrade other features in your business software, you make telling your financial story much easier for your readers.
PositiveVision (PVI) has proudly served manufacturing customers in Greater Chicago for more than three decades. We focus on each customer’s needs to identify their issues and how they want their financial software to help solve them. Our experts guide you through decision making to help you make an informed choice. Contact us to speak to one of our product experts about a customized software solution for your business.