The evaluation process is critical to the success of enterprise resource planning systems, and is one way IT can bring real value to your company’s finance department. Management can’t make informed decisions without financial clarity.
Understanding what finance departments want from ERP
Finance managers require up-to-date systems and technologies to perform several aspects of their jobs, and IT must understand finance’s needs to choose the right ERP system. Three priorities are:
- Keeping pace with enterprise growth – As organizations grow in complexity, ERP systems and the finance function need to keep pace. If the organization has recently gone through a major acquisition or business change, an older ERP system may not be equipped to adjust to the new reality.
- Minimizing reliance on error-prone spreadsheets – Despite the large sums spent on ERP systems and other types of business software each year, many critical finance functions are still completed with Excel spreadsheets. These files frequently lack traditional IT or project management controls to ensure quality, and that can lead to problems.
- Improving analytics and business intelligence – The CFO and finance department are expected to produce business cases, budgets and other reports that are based on high-quality data and solid information processing. Unfortunately, the data often comes from a variety of sources that vary considerably in quality. New ERP software may improve the finance department’s analytics and business intelligence capabilities.
How to add value to finance with technology
Data quality is absolutely essential with financial systems. And processes and training — both of which likely fall under IT’s purview — are as important as the technical capabilities of the software itself when it comes to ensuring data quality. Making sure that best practices are in place may be a new challenge for ÌT groups that have traditionally built one-off solutions in response to requests from business users. Three approaches to help the finance division are:
- Data quality management – Take the time to assess how well the company is organizing and carrying out data management. A visualization tool such as Tableau is often useful to identify anomalies.
- Business process improvement – IT’s traditional strength in business process mapping and improvement should come into play when supporting the finance department. Modelling how finance produces a quarterly forecast or annual budget is an excellent starting point.
- Audit support and tracking – Maintaining accurate records regarding financial transactions is important. IT can add value to this process by maintaining robust identity and access management controls. Budgets and other financial documents frequently change over the course of ongoing business activities, so tracking how decisions are made is important.
Remember that auditors are rarely impressed if a company responds to their queries by saying, “Our system does not track that.” Controls make a difference in achieving “clean” audit results. Finance needs to be able to withstand audits and audit-like inquiries from internal auditors, external auditors and management.
The way forward for finance and IT
Senior executives rely on financial data to make effective decisions. Supporting finance leaders starts by understanding their world and their needs: the pain of manual processes, the need to deliver accurate reports to critical audiences and the importance of enabling managers to make smart decisions. Current and aspiring IT leaders can also learn from their peers in finance who have developed robust reporting and analytical skills. Building these relationships will ensure that IT is at the table and taken seriously when decisions about ERP systems and other financial technologies are contemplated.
Read the entire article at cio.com.