In today’s fast-paced world of business, effective financial reporting and analysis is key to informed enterprise decision-making. However, many financial planning and analysis (FP&A) organizations struggle with a common obstacle related to robust reporting and analysis: data silos. These isolated pockets of financial information hinder the flow of critical data, impeding the ability of FP&A teams to provide accurate and timely insights that help the business make informed strategic decisions. To overcome this challenge, companies must invest in better Corporate Performance Management (CPM) technology that breaks down data silos and offers a single platform where all the data lives and works together naturally and effectively.

Understanding the Problem with Data Silos in FP&A

Data silos can be technical and act like digital barriers that prevent the seamless sharing of information between different departments and systems within an organization. In the context of FP&A, these silos often arise from using disparate software applications, databases or manual spreadsheets for financial data management. This separation of data creates the following challenges, among others, for FP&A teams:

1. Inefficiency:  Retrieving and consolidating data from various sources is time-consuming and error-prone, leaving less time for meaningful analysis
2. Inaccuracy:  Transferring data between systems can introduce errors and become burdensome and make it time-consuming to maintain the mapping between systems, leading to incorrect financial reports and flawed decision-making
3. Limited visibility:  Siloed data restricts a holistic view of the organization’s financial health, making it difficult to identify trends and opportunities
4. Compliance risks:  Data silos can result in compliance and regulatory issues as critical financial information may not be readily accessible for auditors or external reporting requirements
5. Hindered collaboration:  Collaboration between different departments becomes cumbersome when data is stored in insolated systems, impacting cross-functional decision-making

Using a Modern CPM Platform to Break Down the Data Silos in FP&A

To address the problem of data silos in FP&A, organizations must invest in financial software that eliminates risky and unnecessary connections between various systems – a process that becomes time-consuming and costly to maintain. OneStream offers a single solution that covers the full range for the Office of Finance. With the platform approach, data and processes are completely unified, not merely connected and not in separate modules. This platform approach saves time by eliminating the need to move data before running a report.

In essence, OneStream eliminates risk from mapping errors and potential failures in various points of integration that cost money and time to maintain. Below are some key differentiators of OneStream’s CPM platform:

• Financial reporting and analytics:  Unify financial and operational insights to drive performance and deliver value.  Deliver the right information in the right format at the right time.  Replace spreadsheets and standalone financial reporting software with a unified CPM platform, and create customized dashboards and other useful self-service visualizations to quickly and regularly assess financial results
• Real-time data:  OneStream’s approach to financial signaling (Figure 1) ensures that organizations can break the month-end reporting cycle by transforming daily and weekly financial and operational signals from multiple data sources into actionable insights to drive performance

Figure 1:  Financial Signaling in Action

• Robust compliance solutions:  Stay in compliance with US GAAP, IFRS and other local statutory requirements while reducing the organization’s cost of compliance
• Financial data quality:  Ensure a high level of data quality with better data integration and validation of data from multiple sources, driving confident decision-making based on accurate financial and operational results

Why Eliminating Data Silos Improves FP&A Reporting and Analysis

The risks associated with reporting and analysis performed in a system landscape plagued by data silos and how technology can help are clear based on the information above.  But organizations must also understand why eliminating data silos improves the reporting and analysis (Figure 2) performed in a single platform approach to CPM.

Figure 2:  Benefits of eliminating data silos for better reporting and analytics

Below are just some of the benefits that come with eliminating silos:

1. Streamlined data collection:  FPA& teams can bid farewell to the tedious process of collecting data from multiple sources.  A platform approach to CPM financial software automates data collection, ensuring all relevant information is readily available for analysis.
2. Enhanced accuracy:  By eliminating manual data transfers, a CPM platform reduces the risk of errors in financial reports.  This enhanced accuracy leads to more accurate financial analysis and better decision-making.
3. Faster reporting:  With data at their fingertips, FP&A teams can generate reports more quickly, empowering individual users with more self-service reporting capabilities.  This agility allows the organization to respond promptly to changing market conditions and seize opportunities while mitigating risks
4. Advanced forecasting:  Predictive analytics and modeling capabilities such as OneStream’s Sensible ML (Figure 3) can enable FP&A teams to perform advanced forecasting and scenario analysis, helping the organization plan with confidence and identify the drivers of the business.

Figure 3:  OneStream’s Sensible ML can unleash FP&A insights for better reporting and analytics capabilities

5. Improved compliance:  A centralized and accessible CPM platform ensures data is easily accessible for audits and compliance reporting, reducing compliance risk
6. Data-driven insights:  Access to consolidated and up-to-date data empowers Finance to derive deeper insights from financial and operational information.  Finance can identify trends, correlations and anomalies more effectively and in a timely manner
7. Cross-functional collaboration:  A single platform for the Office of Finance and Lines of Business (LOB) teams, as well as for operational reporting capabilities, fosters collaboration across the enterprise by providing a common platform and language for data access and analysis.  This collaboration promotes better cross-functional decision-making and alignment across the organization with key strategic goals and initiatives

Conclusion

In the world of Finance, eliminating data silos is essential for FP&A teams to deliver accurate, timely and insightful financial reports.  This capability helps unleash the power of Finance and ensure Finance is delivering actionable insights at the right time to help drive the business in the right direction to achieve strategic business objectives.  Robust financial software such as OneStream’s modern CPM platform plays a pivotal role in breaking down these barriers.  And ultimately, this approach provides organizations with the tools needed to streamline data management, enhance collaboration and drive more informed decision-making.

By embracing better financial software, companies can pave the way for a brighter financial future where data flows freely and insights abound.

Learn More

To learn more about unleashing the power of reporting and analysis for an intelligent FP&A process, check out our eBook Reporting and Analytics for Intelligent FP&A.

In a previous blog article, I highlighted the increasing buzz in the market in the past 12 months around the topic of environmental, social, and governance (ESG) reporting and why CFOs and Finance teams are paying more attention to it.  In this article, I’ll highlight why a growing number of organizations are leveraging OneStream to align their ESG reporting with their financial reporting and broader corporate performance management (CPM) processes, and the value that delivers.

ESG Reporting in Focus for CFOs

ESG reporting (a.k.a. Sustainability Reporting) refers to the disclosure of data covering a company’s operations in three areas: environmental, social, and corporate governance. It provides a snapshot of the business’s impact in these three areas for investors, customers, and wider stakeholders. The value of ESG reporting is that it ensures organizations consider their impacts on sustainability issues and enables them to be transparent about the risks and opportunities they face.

For many years, ESG reporting was an annual, voluntary disclosure by public and private companies to their stakeholders about the impacts of their enterprise on the environment and society and how they are managing these programs.  With an increasing amount of capital (now roughly $35 Trillion) flowing into “sustainable” mutual funds and ETFs, there is increasing stakeholder interest in ESG reporting and increasing demand for more detailed and frequent disclosures from public and private enterprises.

As a result, corporate sustainability and climate change efforts are fast transitioning from voluntary to mandatory in many countries, and even the US SEC is moving towards defining clear disclosure guidelines for public companies.  Based on this inertia, there is a clear driver for companies to develop robust sustainability and ESG strategies with transparent reporting to stakeholders.  And this is one of the primary reasons ESG reporting is becoming a hot topic for CFOs and Finance teams.

Aligning ESG Reporting with Financial Reporting

As ESG reporting transitions from voluntary to mandatory it will require the same level of governance, control, accuracy, and auditability as financial reporting.  And since CFOs and Finance teams fully understand how to drive control and accuracy in financial reporting, they are best suited to overseeing the collection, consolidation, and reporting of ESG and data alongside financial results.

While ESG reporting is quickly becoming mandatory, meeting an organization’s sustainability objectives will require a management process that’s similar to the corporate performance management (CPM) process that Finance teams employ to help them meet their financial objectives.  This process includes goal setting, planning, monitoring and reporting, and analyzing results to track progress and make adjustments as needed to stay on track.

As stated by Accenture in a recent survey report on ESG reporting, “Meeting demands for sustainability data will be integral to company performance.  Making a CFO responsible for sustainability is essential for ensuring a company meets its ESG goals.  Companies are much more likely to extensively embed ESG in core management processes when the CFO has accountability for ESG metrics.”

Aligning ESG with Financial Reporting and CPM

While many organizations manage ESG reporting via spreadsheets or point applications, both of these approaches create a data collection, consolidation, and reporting process that’s separate from the financial reporting process. And if ESG metrics need to be reported alongside financial metrics, wouldn’t it be better if this data was collected in the same system and processed as financial data?

The answer is yes, and that’s why a growing number of OneStream customers are extending the usage of our unified, CPM software platform to support their ESG reporting and management requirements.  OneStream’s platform provides several key capabilities that make it a great fit for ESG reporting.  These include the following:

Financial Data Quality:  OneStream can load and validate large volumes of financial and non-financial data such as GHG emissions, water and electricity usage with validations and out-of-the-box drill-down and drill-back capabilities to source data providing ultimate auditability.  OneStream can connect to any source of ESG data as required such as ERP, CRM, HR systems, and internal data warehouses.   The platform can also collect data via flat files, spreadsheets, or data entry forms.

Guided Workflow: OneStream allows customers to design the user experience around the process and apply controls, validation, and governance on ESG data collection, managing the monthly, quarterly, and yearly tasks together.  Customers can also leverage the OneStream Task Manager solution to manage and orchestrate the process further and enable email notifications.

Financial Consolidation:  OneStream can aggregate and consolidate ESG data and textual commentary quickly to provide company-wide results.  With OneStream, your ESG data is consolidated according to the same principles as your financial data, and with the same level of control, governance, and audit trails.  Complex ESG data conversions are supported, along with eliminations and partial ownership calculations. Customers can future-proof their CPM solution to support new standards with unlimited configurable dimensions and hierarchies – supporting GRI, SASB, and other frameworks as required.

Reporting & Analytics:  In addition to financial and management reports, configurable dashboard visualizations (see figure 1) can provide deep analysis of ESG data and turn it into valuable information and insights.  OneStream also supports ad hoc analysis via Microsoft Excel integration, a built-in spreadsheet component, and pivot grids.  Integration with MS Office products enables users to produce and distribute PowerPoint decks, Word Docs, and PDFs with ease.  Data Blending supports reporting and analysis on high volumes of non-financial data.

Planning and Forecasting:  Customers can plan and forecast on ESG with confidence and without compromise. They can set ESG goals and objectives, track Actuals v Target, and provide variance analysis & commentary.  Users can perform what-if scenario modeling to understand the impact of ESG policies on financial results and business value. OneStream supports unlimited extensible data models for any ESG planning process.

Based on these capabilities, OneStream’s platform is well-suited to supporting the collection, consolidation and reporting of ESG data and commentary for internal and external reporting. Much of the emissions data can be found in the local ERP systems and sub-ledgers. For example, energy bills, water consumption, fuel usage is all available on the invoices in the ERP data.  But the formatting, units, etc., are likely all different and there are many other offline or manual data collection processes that need to happen to bring everything together and holistically report on ESG initiatives.

Customers Leading the Way

OneStream has several customers that are already using our platform to collect, consolidate and report ESG data.  One example is a CPG holding company that has grown organically and via acquisitions of many food providers.  When they acquire companies, they let them keep their existing ERP systems as they are all manufacturing companies.  As a result, they have over 50 different GL/ERPs at 100+ locations.

This organization had been collecting data for financial and ESG reporting via spreadsheets and email, so it was highly manual, time-consuming, and prone to errors. They selected OneStream (see figure 2) to collect, consolidate and report their financial and non-financial/ESG data.

With OneStream the organization now has one system for actuals, budgets, quarterly forecasts, ESG reporting, weekly operations data, and M&A analysis. Having a single system and process saves time and reduces redundancy in data collection.  Subsidiaries provide a single submission for financial and ESG reporting.  The company has eliminated errors in data collection by using data entry forms with validation checks for key environmental and social metrics.

Conclusion

ESG and Sustainability reporting is rapidly moving from a voluntary to mandatory process.  CFOs and Finance teams need to get engaged to ensure the accuracy and integrity of ESG and sustainability reporting to a variety of stakeholders.  Aligning ESG reporting with the financial reporting and performance management process and system can eliminate duplication, increase accuracy, ensure compliance and improve the overall management of ESG initiatives.

To learn more, check out our white paper titled “The New CFO Imperative: Unifying ESG & Financial Reporting”, or contact OneStream if your organization is ready to align ESG reporting with financial reporting and get ahead of upcoming disclosure mandates.

Download the White Paper

ESG reporting is likely to be one of the most significant changes to corporate reporting for decades ahead.  Increasingly, organisations are recognising the benefits effective ESG reporting can bring and are expressing their intentions with updated visions or missions around ESG. 

As ESG reporting rapidly transitions from voluntary to mandatory, the same level of governance, control, accuracy and auditability needed for financial reporting will be required with ESG.  CFOs and Finance teams already fully understand how to drive control and accuracy in financial reporting.  Accordingly, Finance teams are best suited to oversee the collection, consolidation, and reporting of ESG data alongside financial results.

A compelling argument now exists to put down the foundational layer for alignment of ESG with Financial reporting within organisations. Why?  Well, with some mandatory ESG reporting requirements already in force and additional ones on the horizon, meeting organisational sustainability objectives will require a management process like the corporate performance management (CPM) process that Finance teams employ to help meet financial objectives.  This management process includes goal setting, planning, monitoring and reporting, and analysing results to track progress and adjust as needed to stay on track.

As emphasised in the recent ‘Measuring Sustainability.  Creating Value’ Accenture survey report on ESG reporting, ‘Meeting demands for sustainability data will be integral to company performance.  Making a CFO responsible for sustainability is essential for ensuring a company meets its ESG goals.  Companies are much more likely to extensively embed ESG in core management processes when the CFO has accountability for ESG metrics.’

Many of the ESG reporting solutions in the market are focused on only a specific aspect of ESG, such as environmental, health and safety (EH&S) compliance.  That means the solutions aren’t suited to the broader requirements of setting ESG goals and targets, tracking progress against targets, and modelling the impact of ESG initiatives on future financial results. 

With a unified CPM platform such as OneStream aligning ESG and financial reporting, all processes are handled within a single application and instance. 

Benefits of Aligning ESG & Financial Reporting

• Eliminate duplicate data collection, consolidation and reporting processes – data is collected once from each business unit and immediately available across all processes. 

• Improve the accuracy and integrity of ESG and sustainability reporting – an effective data collection with strict audit controls alongside a standard, defined and repeatable reporting process delivers maximum confidence and reliability. 

• Align ESG and sustainability metrics with financial results – ESG data is collected using the same process used to collect the financial reporting data and can be viewed and analysed in the same dashboards (See Figure 1).

• Establish high-quality governance and control over ESG and sustainability metrics – data is collected with validations on load, a defined process with task lists and automation brings structure, and calculations should be fully traceable. 

• Compare actual ESG and sustainability metrics with goals and targets – a unified platform approach which combines planning with the actual financial close and consolidation process eliminates risky integrations, validations and reconciliations between multiple products.

Unifying ESG with Financial Reporting

OneStream’s unified, Intelligent Finance Platform (see Figure 2) with built-in reporting and analytics eliminates the complexity of fragmented ESG & financial reporting tools. With a strong foundation in financial data quality, OneStream allows organisations to integrate and validate large volumes of non-financial data (e.g., ESG metrics and conversion factors) with validation from any number of sources. Confident decisions can then be based on accurate and trusted financial and operating results.
OneStream’s financial data quality management is not a module or separate product. Instead, the management is built into the core of the OneStream platform — providing strict controls to deliver the confidence and reliability needed to ensure quality data.

Users can quickly aggregate and consolidate ESG data submissions to provide company-wide results. ESG data is consolidated according to the same principles as financial data. Calculations and eliminations based on specific data values and fuel and energy consumption conversions can also be automated.

Essentially, OneStream “future-proofs” CPM and ESG reporting to ensure compliance when new standards come along. How? OneStream allows for unlimited configurable dimensions and hierarchies – ensuring support for GRI, SASB and other frameworks which may emerge as required.

As a unified platform, OneStream enables organisations to plan and forecast on ESG initiatives with confidence and without compromise. ESG goals and objectives can be set, and users can track actuals vs. targets and provide variance analysis & commentary. What-if scenario modelling is also available to understand the ultimate impact of ESG policies on financial results and business value.

Effective ESG reporting ultimately allows investors to gauge an organisation’s intentions and actions – from how the organisation treats people to how board decisions are made or whether environmental factors are being prioritised. To report with confidence and achieve meaningful targets, organisations must therefore have the right ESG solution to drive performance.

Learn More

To learn more, read our ESG Whitepaper or check out the blog posts in our ESG series.  And if your organisation is ready to align ESG reporting with financial reporting and get ahead of the upcoming disclosure mandates, contact OneStream today to get started.

Download the White Paper

Data analytics is top of mind for higher education leaders, and they are looking to implement changes to transform the use of data across their institutions.  However, many are struggling to make the shift. Why? They are up against the challenges of disconnected Finance processes and systems, budget constraints and more. To overcome these, colleges must think bigger and look for long-standing solutions that simplify and maximize business impact. A modern Corporate Performance Management (CPM) solution offers a way to not only break technology and process barriers but also empower Finance with actionable insights.

The Momentum

Data analytics is gaining momentum in higher education.  While the past several years have seen a focus on data, the recognition that institutions need to prioritize data now more than ever gets clearer every day.  That prioritization can mean supporting data analytics by hiring staff, implementing processes, leveraging new technology and much more.  In doing so, making data a priority is becoming more important amid the challenging and competitive landscape in higher education.

In that landscape, Finance and Operations teams deal with the complexity of evolving student needs, workforce requirements, funding constraints and other factors – combined with the pressure to be agile and move quickly.  And the best way to manage all of that effectively are tools that provide Finance and Operations with timely, trusted and relevant data.

The Chronicle of Higher Education survey¹ explored higher education views on the increasing use of data-driven decision-making. According to the survey, most college officials — 97% — strongly agree that institutions need to use data and analytics better to become data-driven institutions (see Figure 1).  

Going further, when asked to rate where better data is needed at their institutions, 90% of college officials cited a need for better data in business and financial operations (See Figure 1).  This overwhelming agreement emphasizes the acknowledgment of a real need to get people relevant financial and operational data.

However, making the shift to data-centric analysis and decision-making for Finance teams is easier said than done.  Why?  Universities and colleges must overcome key obstacles to establish changes that will last.

So what’s restricting people from getting the necessary Finance and Operations data?

The Barriers

The survey¹ highlighted that culture, tools and processes, and resource constraints represent barriers to progress in data analytics.

According to the survey, the top three barriers to using data are as follows:

1. Decentralized/siloed data collection
2. Budget constraints
3. Trouble turning data into action

Breaking the Barriers

How can Finance teams overcome these barriers with technology?

University Finance teams have answered this question with a modern CPM solution.  Let’s dive into the top three barriers and discuss how having the right technology can mitigate the financial and operational data challenges institutions face today.

Barrier #1: Decentralized/Siloed Data Collection

Colleges and universities are complex not only because they provide different services but also because institutions use a number of systems and fragmented processes.  For example, considerable time and effort are required to pull together the annual budget across the different services at an institution.  Considerations include consolidating position and operating expenses, funding available, planned commitment spend, capital project information, tuition, enrollment data and more.  Does this web feel familiar?  (See Figure 2)

That web of chaos gets even more complicated with the applications, shadow systems and spreadsheets being used for financial reporting and planning.  Plus, as more funding sources, programs and services are added, the web only continues to expand!

In the modeling toolkit web of chaos shown in Figure 2, each line represents not only a risk and cost, but also data latency and redundancy.  Even if that web includes all good products, they’re all developed on different technologies and don’t naturally work together, yet must somehow be connected.

A modern CPM solution improves the toolkit chaos.  Having an intelligent platform that will simplify and unify Finance processes will remove the silos.  How?  A truly unified platform breaks the silo barriers and brings together data, analytics, plans, reporting and decision-making in a single solution.  This unification allows users to have one source of truth for data that can be leveraged for planning and reporting.

Barrier #2: Budget Constraints

The second largest barrier to improving data analytics is the budget.  Establishing data analytics requires having the right people, processes and tools in place takes time, effort and cost to implement.  Having all those pieces in place is tough, especially for budget-strapped institutions.

So how can institutions break the barrier of budget constraints?  By establishing a long-term strategic vision of a cost-effective approach to improving data analytics.

A CPM platform offers exactly that.  A modern CPM platform unifies financial and operational processes to provide a practical, long-standing approach that will help mitigate costs incurred and provide future benefits.  How?  Here are just a few of the ways:

• Reducing the time, effort and expense of maintaining legacy applications and disconnected solutions.
• Supporting future growth with less software, not more, by deploying additional or extending existing solutions on the same platform.
• Simplifying training and support for end users, who can learn multiple processes on one platform. This will reduce the learning curve, streamline user experience, and drive user adoption.

Ultimately, institutions can gain a great ROI by having a single platform that extends the use of the software to address evolving business needs.

Barrier #3: Trouble Turning Data into Action

CPM software is designed to help Finance turn data into action.

A CPM platform can help institutions overcome trouble in turning data into action by unifying financial and operational data into a governed, flexible platform.  Users can leverage this data across the platform’s analytics tools via standard reports, self-service reporting, visualizations and ad-hoc analysis tools.  A modern CPM platform can provide data at the right level of detail for both Finance and non-Finance to empower them to make more data driven decisions.

Conclusion

With the shift to more data-driven analytics, institutions are feeling the challenges of data silos, budget constraints and trouble turning data into action.  But those challenges aren’t insurmountable.  A modern CPM platform helps Finance leaders overcome these hurdles and enable more data-centric analysis and decision-making.

Learn More

At OneStream, we understand the complexities, frustrations and challenges of managing disconnected information.  And that understanding is exactly why we are so focused on helping higher education teams unleash data analytics to enable confident decision-making. 

At OneStream, we call this intelligent finance. 

Want to learn more about how OneStream can empower your higher education Finance team? View our Higher Education website, or contact us for a demonstration.

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1 Anft, Michael (2023), Sponsored by AWS.Becoming a Data-Driven Institution: College Leaders Assess the Value and Challenges of Using Data to Make Strategic Decisions, The Chronicle of Higher Education, Inc.

Scenario planning is a valuable tool for businesses looking to prepare for the unexpected, but creating accurate scenarios can be a complex and time-consuming process. Traditionally, these exercises required substantial iterative cycles and were very manual.

That’s where artificial intelligence (AI) and machine learning (ML) forecasting come in – these technologies can help businesses power their scenario plans with more accurate and reliable data, allowing them to make better-informed decisions and stay ahead of the curve.

Powering Scenario Plans with AI & ML Forecasts

Scenario planning involves creating multiple possible futures for a business, considering a range of different variables such as market trends, consumer behavior, and technological advancements. The process typically involves identifying key drivers of change, developing a range of plausible future scenarios, and assessing the potential impact of each scenario on the organization.

The goal is to identify potential risks and opportunities and prepare accordingly rather than simply reacting to events as they happen. Scenario planning can help organizations make more informed decisions by enabling them to anticipate potential future events and develop strategies to mitigate risks and take advantage of opportunities. (see figure 1)

Scenario planning involves creating multiple possible futures for a business, considering a range of different variables such as market trends, consumer behavior, and technological advancements. The process typically involves identifying key drivers of change, developing a range of plausible future scenarios, and assessing the potential impact of each scenario on the organization.

While scenario planning can be a powerful tool, creating accurate scenarios can be a challenge. Traditional scenario planning methods can be time-consuming and challenging to execute. One of the main challenges is forecasting. Forecasting involves predicting future events, such as changes in consumer behavior, market trends, and technological advancements.

Traditional forecasting methods often rely on historical data and expert opinions, which can be unreliable and may not reflect current market conditions or emerging trends. Additionally, traditional forecasting methods may not account for the complex interrelationships between different factors that can influence future events. It’s difficult to predict exactly how different variables will interact, and human biases can creep in, leading to scenarios that are overly optimistic or pessimistic.

That’s where AI and ML forecasting comes in.

The Role of AI and ML in Scenario Planning

Advances in AI and ML have made it possible to enhance scenario planning by providing more accurate and reliable forecasts. AI and ML can analyze vast amounts of data and identify complex patterns and relationships between different factors. This can enable organizations to develop more sophisticated and accurate forecasts that reflect current market conditions and emerging trends.

By incorporating AI and ML forecasting into scenario planning, businesses can create more realistic and useful scenarios, helping them to make better-informed decisions and stay ahead of the curve.

Data analysis

AI and ML can help organizations analyze large amounts of data and identify patterns and trends that are not visible to humans. This can provide insights into potential future scenarios and help organizations prepare for them.

Use Case: Enrich Data to Identify Patterns

AI and ML can be used in scenario planning by incorporating external data sources, such as social media, news articles, and weather forecasts to help understand to what extent these factors correlate with forecast performance.  By analyzing these sources in real time, organizations can identify emerging trends and adjust their scenarios accordingly. (see figure 2)

For example, a manufacturer might use AI to analyze social media conversations about its products and identify emerging customer preferences. By incorporating this information into its scenarios, the manufacturer can adapt its product development and marketing strategies to meet customer needs better.

Prediction

AI and ML can be used to predict future outcomes based on historical data. This can help organizations identify potential future scenarios and make informed decisions about how to respond to them.

Use Case: Predicting Consumer Behavior

One key variable in many scenarios is consumer behavior. Businesses need to understand how consumers will respond to new products, changes in pricing, and other factors in order to make informed decisions. AI and ML forecasting can be used to analyze consumer data and predict how consumers will behave in the future. This information can be used to create more accurate scenarios and identify potential risks and opportunities. (see figure 3)

For example, consider a retail company that is considering launching a new product. By using AI and ML forecasting to analyze consumer data, the company can predict how many units of the product it’s likely to sell in different scenarios. This information can be used to create different sales forecasts for different scenarios, allowing the company to prepare accordingly.

Simulation

AI and ML can be used to create simulations of potential future scenarios. This can help organizations understand the potential impact of different decisions and prepare for them accordingly. (see Figure 2)

Use Case: Forecasting market trends

Market trends are another important variable in scenario planning. Businesses need to understand how the market is likely to change in the future in order to make informed decisions. (see figure 4)

For example, consider a financial services company that is creating scenarios for the next five years. By using AI and ML forecasting to analyze market data, the company can predict how interest rates, inflation, and other key variables are likely to change over that time period. This information can be used to create different economic scenarios, allowing the company to prepare accordingly.

Optimization

AI and ML can be used to optimize scenarios by identifying the most likely outcomes and helping organizations prepare for them. This can help organizations be more effective in their scenario-planning efforts.

Use Case: Predicting Supply Chain Disruptions

Supply chain disruptions can have a significant impact on businesses, especially those that rely on just-in-time inventory or complex global supply chains. AI and ML forecasting can be used to analyze supply chain data and predict where disruptions are most likely to occur. (see figure 5)

For example, imagine a manufacturing company is creating scenarios for the next year. By using AI and ML forecasting to analyze supply chain data, the company can predict where disruptions are most likely to occur – for example, due to natural disasters or political unrest. This information can be used to create different scenarios for supply chain disruptions, allowing the company to prepare accordingly.

In each of these examples, AI and ML forecasting allows businesses to create more accurate and realistic scenarios, helping them to make better-informed decisions and stay ahead of the curve.

Conclusion

AI and ML technologies have been a catalyst for organizations to relook at how they leverage scenario plans, the pace at which they plan decisions, and the data they use to make those decisions. Customers can overcome the tedious and time-consuming scenario planning by enriching the process with AI and ML solutions by providing faster, more accurate and reliable forecasts.

Learn More

To learn more about how FP&A teams are moving beyond the AI hype to enrich scenario planning, check out our white paper, Sensible Machine Learning for CPM – Future Finance at Your Fingertips.

Download the White Paper

When it comes to corporate performance management (CPM), distilled down to the simplest terms, Finance has three basic roles to fulfill in its support for the organisation:

1. Looking backward with processes such as the financial close and consolidation to produce an accurate book-of-record income statement and balance sheet to represent an organisation’s financial position.
2. Looking forward to planning and forecasting to empower decision-makers with insights to support faster and more informed decision-making for the next month, quarter, and beyond.
3. Providing right-time guidance for daily and weekly financial and operational decisions across the enterprise to drive organisational performance before month- or quarter-end.

Binding all three roles together, of course, facilitates effective financial reporting and operational management reporting.  Why does this matter?  Well, for all the reporting and analysis to be impactful and well understood, it first must be communicated to stakeholders in a timely, clear and actionable format.

Organizations now need to move forward with their finance and operational reporting to drive the increasing levels of agile decision-making expected.  It is time to kick old, inefficient processes to the curb.  Move away from the limitations of fragmented tools and truly deliver effective reporting from a unified, intelligent finance platform.

Limitations of Fragmented Reporting Tools

Many Finance teams struggle to meet varying stakeholder reporting needs.  Why?  Mainly it’s because such Finance teams rely on a fragmented mix of reporting tools – such as siloed spreadsheets, legacy CPM software, and stand-alone BI tools.  Doing so means Finance teams must invest an inordinate amount of time and manual effort to not only copy and paste data but also then reconcile and format reports.

Ad-hoc reporting is also frustrating for Finance and Line-of-Business (LOB) managers who require accurate information to make effective business decisions.  Finance teams must often choose whether to provide business partners with the training and access to yet another fragmented tool or to take the time to produce new reports on an as-needed basis.

Either way, the burden falls on Finance.

Effective Performance Reporting

To realise their full potential as strategic business partners, Finance leaders of sophisticated organisations require reporting capabilities that are aligned with their CPM processes but address the variety of stakeholder reporting needs.  OneStream achieves all of that – empowering Finance to lead at speed with a single lens across the organisation while providing a single source of the truth and a high level of financial data quality for more effective and streamlined financial, statutory, and management reporting.

Why Is Effective Reporting Important?

OneStream simplifies both financial reporting and operational reporting by allowing users to focus on the quality and content of their data rather than constantly working through the mechanics of building reports.  Here are just a few additional benefits OneStream offers for financial reporting and analysis:

• Unifies Financial & Operational Data: OneStream brings detailed operational insights to Finance and non-Finance users with built-in financial signaling.  It intelligently aligns detailed data from multiple sources (e.g., CRM, HCM, or data warehouses) with financial data to produce the weekly and daily signals that drive performance.
• Streamlines Reporting & Increase Controls: OneStream eliminates reliance on Excel®, rogue databases, and manual processes for data gathering, reconciling financial data, and creating reports.  Users can create reports with 100% accuracy through a unified platform for analytics and reporting.
• Automates Report Creation & Distribution: OneStream standardises reports for varying stakeholder groups with over 50 predefined report types.  It automates report creation and distribution with the Parcel Service solution from the OneStream Marketplace.
• Creates Self-Service Visualisation: OneStream enables LOB and functional business partners to tell the story with easy-to-use, self-service visualisations.  Users can further extend insights by blending operational and financial data in a unified dashboard.

OneStream Customer Success

OneStream’s unified, Intelligent Finance Platform (see Figure 1) with built-in reporting and analytics eliminates the complexity of fragmented reporting tools.  Through built-in advanced reporting and analytic capabilities, OneStream empowers sophisticated organisations by offering a unified solution for financial close, consolidation, budgeting, planning, forecasting, reporting, analytics, and financial data quality.

By intelligently aligning detailed operational and financial data, OneStream’s flexible reporting and analysis capabilities eliminate the need for Finance teams to waste time manually copying data and creating reports.  In other words, OneStream unleashes Finance teams to focus on providing insights and analysis to better support key decisions.

Below are details about how two OneStream customers achieved significant benefits from the reporting and analytics available within our unified platform.

Crane Worldwide Logistics – Crane’s goal to remain lean and provide meaningful business insight to management was well supported by OneStream.  From a more efficient close cycle and dynamic reporting — including automated cash flow – to drastically reducing the days in the planning cycle, Crane realised a big return on their investment.  Crane is now well suited to acquire new sites or create legal entities with full confidence in OneStream’s ability to handle the integration and deliver results.

Management can rely on OneStream to deliver quick results and make real-time decisions accordingly.  “The nice thing about OneStream is that the platform has proven that our data is now correct”, said Katrina Celestine, Financial Reporting Manager at Crane.  “Everything from reconciliations to cube views, to custom reporting has been huge.  Best of all has been the drill-down functionality.  When someone asks a question about an amount, I can drill into the detail and see exactly what’s pulling into it and provide support.  With OneStream, the answer is always at your fingertips, which I really like”.

Sasfin – By implementing OneStream, Sasfin has achieved full data integration across the organisation – creating a single view of the truth.  This integration is much more than mere automation.  Rather, the integration unifies and streamlines financial processes so that the data is consistent and reliable at all times.  Because processes are more efficient, Finance teams are released to add higher value to the whole organisation.

This paradigm shift in the role of the Finance function has been the greatest benefit to Sasfin.  Where they previously poured resources into generating reports each month, the company is now empowered to apply their brainpower to analyze the information coming through the reports.

Drive Performance with Built-in Reporting & Analytics

The Finance organisation’s historical credibility in controlling financial data, metrics, analysis, and reporting gives it a unique voice of authority and trust among business leaders.  That’s why OneStream’s Intelligent Finance Platform was designed to help the Office of the CFO drive performance with a wide range of solutions across Accounting, Finance, and Operations business partners.  With OneStream, companies get built-in reporting and analytics, financial consolidation, and planning all within one unified solution.

As a result, OneStream is giving Finance leaders across the globe the ability to finally harness their data with the speed, scale, and control required to guide decision-making and drive performance —with a seamless user experience that doesn’t force Finance teams to compromise on business processes or technology.

Learn More

If your Finance organisation is being hindered from unleashing its true value, maybe it’s time to evaluate your internal systems and reporting processes and start identifying areas for improvement.  To learn more, download our e-book on Reporting & Analytics today.

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Artificial intelligence (AI) and machine learning (ML) have revolutionized many industries, but the field of financial planning & analysis (FP&A) has been slow to adopt this technology.  Despite the numerous benefits AI – and more specifically, ML – can bring to Finance (e.g., increased efficiency, accuracy and strategic insights), many organizations still hesitate to implement either in their FP&A processes.  What’s holding FP&A back from reaping the vast benefits of ML?

To answer this question and more, this blog will explore some of the challenges holding FP&A back from fully embracing ML and how those challenges can be overcome.

Market Appetite for ML

While not yet as widely accepted as the move to the cloud for the financial close and planning processes, ML adoption is already increasing, according to the 2022 Data Science and Machine Learning Market Study by Dresner Advisory Services.  In 2016, less than 40% of responding organizations reported using or actively exploring ML.  That same metric was about 70% in 2022 (see Figure 1), showing a steady increase over the last seven years.  On the surface, that progression underscores the AI hype and excitement for the potential benefits of using AI for FP&A.

But what happens if the data gets broken down by function?  A bit of a different reality emerges for the Office of Finance and FP&A.

In fact, the study shows that only 20% (see Figure 2) of Finance organizations are currently using AI and ML, and Finance actuals lag most functions, despite all the buzz and chatter out there.

What’s Holding FP&A Back?

With so much buzz yet low adoption, what key barriers are holding FP&A and Operations teams back from mainstream adoption of ML solutions?  Figure 3 depicts the barriers.

Below, the details about these key barriers show why they’re preventing widespread implementation of cutting-edge ML technologies:

Lack of Expertise

• FP&A teams can struggle to deploy ML in enterprise planning processes, such as rolling forecasting or demand planning, due to lacking the required expertise in ML and machine learning modeling techniques.  Without dedicated business analysts and data science engineers, teams cannot realize the full potential of ML in planning processes.  
• A lack of expertise is especially relevant for organizations with existing ML investments, where the lack of specialized resources hinders the ability of FP&A teams to effectively utilize ML in their work.  Without dedicated expertise or resources, FP&A teams are severely limited in their ability to take advantage of AI and ML.

Lack of Scale

• For organizations with existing data science teams, creating repeatable and systematized ML processes and infrastructure across the enterprise is expensive.  Additionally, most ML capabilities within CPM tools today are only capable of producing a single forecast (target) at a time.  Why does that matter?
• FP&A’s role is to lead and drive effective planning processes across lines of business and functions (e.g., HR, Sales and Operations).  And if unable to empower the organization to forecast at scale, FP&A is not executing as a strategic business partner.  AI solutions for FP&A that cannot scale are no different and will never reach mass adoption, causing the solutions to ultimately fail.

Lack of Business Intuition & Transparency

• Traditional ML modeling processes within CPM tools are often a “black box” to FP&A teams (see Figure 4).  Why does this matter?  Well, ML modes aren’t complete without material business “intuition” and/or offer users only limited visibility or traceability into model inputs and results.  Such limitations can result in a lack of trust or confidence in the results.

As a strategic business partner, FP&A must instill confidence in forecasting processes.  And while leveraging AI and ML is likely to increase forecast accuracy, P&L owners cannot assess the drivers that comprise forecasts – P&L leaders who can’t will never own their forecasts.

And if P&L owners don’t own their forecasts, forecasting processes break down and fail altogether.  That means FP&A has failed too.

Fragmented & Disconnected Processes

• Current AI and ML solutions within CPM typically require data movement and reconciliation between fragmented systems and Finance processes.  Those requirements increase the technical debt and limit the ability for advanced analytics to scale across the organization.
• The fragmented software and technical processes needed for connected planning create added technical complexity and administrative burden for FP&A teams.  This burden includes constantly moving and reconciling data, monitoring data latency, and managing security between fragmented products or models.  Collectively, the burden dilutes the ability of strategic FP&A teams to focus on driving performance and supporting critical decision-making.

Conclusion

Despite these challenges, ML has the potential to significantly improve Finance operations and outcomes.  By automating manual processes, ML can help Finance professionals save time and improve accuracy, which can lead to more effective decision-making.  Additionally, ML can provide real-time insights into financial performance.  Those insights can then help Finance professionals identify trends and make informed decisions.

As AI and ML for FP&A enter the mainstream, organizations will undoubtedly have several choices to consider.  On one spectrum, solution vendors for AI (see Figure 5) are offering everything from AI infrastructure solutions to data science toolkits and complete AI platforms to create and deploy ML models.  While these are powerful tools addressing varying use cases, the tools aren’t designed for FP&A teams.

Corporate performance management vendors are also investing in AI capabilities to support extended planning & analysis (xP&A) processes such as demand planning and sales planning.  As Figure 5 illustrates well for AI vendors, CPM vendors will also solve their customers’ AI needs in different ways.

So then, what’s the lesson in all this?

Don’t let AI hype cloud the evaluation process.  Start with a clear understanding of “what” business outcomes the FP&A team is trying to achieve with ML.  Identify “who” is using the solution and “how” the solution is unified into existing planning processes.

And with answers to these questions in mind, use the evaluation process to “get under the hood” to learn whether the solution will unleash the organization from the key barriers holding FP&A back from moving beyond the hype.

Learn More

Want to learn more about how FP&A teams are moving beyond the AI hype?  Stay tuned for additional posts from our blog series, or download our interactive e-book here.

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Organisations face an abundance of varied regulations across the globe.  Exactly which ones apply depends greatly on the size or type of the organisations and the location or industry in which they operate.  In the area of accounting compliance, the focus is on ensuring accurate transaction processing and reporting of financial results, and complying with regulatory guidelines, such as Sarbanes Oxley (SOX), European Union (EU) and other regulatory guidelines.  The compliance aspect relies on having a high degree of controls, the segregation of duties and detailed audit trails.

Here’s the simplest definition: Compliance ensures an organisation discloses how well it is or is not complying with the relevant regulations.  To demonstrate full compliance, organisations must build and maintain reports that can be produced during audits.  Plus, organisations must not only publish statements to that effect in annual financial reports but also avoid violating any regulations at any given moment.

Failing to comply with the industry standards, laws, rules and regulations set by regulatory bodies and government bodies can result in hefty penalties, reputational losses and expensive legal actions.  Even worse, non-compliance can even cause organisations to fail or be shuttered.

Why Do Compliance Reports Need To Be Effective?

What does effective compliance reporting look like for enterprise performance management (EPM)?  Well, let’s start with defining exactly what effective means.  What does ‘effective’ mean?  The thesaurus definition states that effective = being successful in producing a desired or intended result.

In the context of EPM and financial and operational reporting, I would suggest that effective means the reports demonstrate compliance with all the regulations relevant to the organisation in the industry and geographies in which the organisation operates.

Effective compliance reporting should have the following characteristics:

1. Meaningful: Effective compliance reporting must deliver meaningful reports.  Importantly, many compliance reports go to senior executives, board directors and external stakeholders.  While they might understand the concepts for regulatory compliance, these groups won’t necessarily know all the lingo or terms that might be used within the organisation.
2. Timely: Effective compliance reporting must be generated in a short timeframe and be as automated as possible.  The quality of the data is especially important – meaning controls, auditability and traceability all help ensure effectiveness.  The manual creation of compliance reports is ineffective, expensive, painstaking and highly prone to error, which is a big reason EPM software is widely used for compliance reporting.
3. Purposeful: Customers can often require compliance reports.  For example, a customer might want to understand an organisation’s cybersecurity, anti-corruption programs or ESG performance – before agreeing to do business with the organisation.  Effective compliance reporting can address customer questions in those areas.  (And as the business landscape keeps marching towards a world of high regulatory and ethical expectations, those demands from customers will only get more insistent.)

Important Factors to Achieve Effective Compliance

To achieve effective compliance reporting requires fully reviewing the existing systems and processes and then taking steps to eradicate manual activities by replacing spreadsheets and manual data uploads.  Only by fully automating key financial processes and reporting within a unified, governed and flexible EPM platform can organisations achieve an effective and streamlined reporting process.

A effective unified EPM platform should have financial data quality management (FDQM) at its core.  This capability is critical for organisations to drive effective transformation across the Finance function and the Lines of Business.  In FDQM, a key requirement is 100% visibility from reports to sources – all financial and operational data must be clearly visible and easily accessible.

The solution should also include guided workflows to protect business users from complexity.  How?  By uniquely guiding them through all data management, verification, analysis, certification and locking processes.

Strict process controls are vital, and the system should include the following:

• Data and process certification and sign off
• Audit trails from 10K/10Q to GL source account and GL trial balance
• Support for SOX 302 and 404 certification questionnaires to identify financial process weaknesses

Importantly, the unified platform should support all reporting requirements with standard, defined and repeatable processes for financial data collection and consolidation.  The ability to produce financial statements that meet GAAP, IFRS and local statutory accounting requirements is paramount to effective compliance that meets all reporting requirements.

What You Need to Know

Effective compliance can bring opportunities to any organisation – including those listed below.

• Reduce costs: Doing the right thing is more important now than ever since reputations are key to attracting and retaining talent.  Why?  People are attracted to organisations who visibly operate in a responsible way.  The result?  Lower costs stemming from organisations being able to keep the top talent they recruit for longer, which ultimately helps the bottom line.
• Attract investment: Investment is increasingly driving towards organisations with a focus on the surrounding environment.  Roughly $35 trillion is now flowing into ‘sustainable’ mutual funds and ETFs.  By doing the right thing (i.e., being compliant), organisations can be more attractive to investors, which brings new opportunities for growth.
• Increase revenue: Customers are increasingly interested in the organisations behind products purchased.  And thanks to social media and other digital means of communication, consumers are more aware than ever.  Attracting more customers will bring more demand and therefore more revenue.

Organisations can enjoy all the above benefits – and others! – by taking the high road on compliance and ensuring the systems and processes in place can deliver meaningful, timely and purposeful compliance reporting.

Case Studies

Toll Group, part of Japan Post, is a logistics, distribution and freight forwarding business with dual headquarters in Melbourne and Singapore.

Toll’s objective in implementing OneStream was to have a single group team in a single system handle the statutory consolidation and reporting process for all legal entities.  This capability would improve the group governance and oversight on compliance activities and results analysis.  At the same time, the divisional team resources would be free to focus on internal budgeting and forecasting, performance reporting and local ledger reporting development.

By meeting Toll’s needs, OneStream has enabled a significant improvement in the accuracy and timeliness of reporting.  Group governance has also improved, with increased oversight on compliance activities and results analysis.  OneStream’s automation of data loads and improved data quality has ultimately allowed the Group to eliminate a massive amount of manual data handling in Excel®.

Johnson Outdoors is a leading global outdoor recreation company that turns ideas into adventure with innovative, top-quality products.

Johnson Outdoors was looking to maximize a single investment in a global Finance platform.  They needed to improve multiple Finance processes (e.g., consolidation, reporting, SOX, budgeting, data submission process, audit support and cash flow reporting) – and they needed the platform to be fully owned by Corporate Finance.

The OneStream platform now allows Johnson Outdoors to deliver global financial consolidation, management reporting, guided workflows and a robust planning solution, all in one product and one application.  The improvements in data collection, workflow, submission approvals and full audit capabilities back to data sources and the JDE data warehouse have transformed Johnson Outdoor’s compliance processes.

Conclusion

Ultimately, both internal and external stakeholders need to know the information they read about an organisation in reports can be trusted.  The reports must also be easy to read and instill confidence in every reader.  For organisations who can meet those requirements and take compliance to the highest level by having robust systems and processes in place, opportunities abound to reduce costs, retain talent, attract investment and increase revenue.  And the first step to reaping the rewards of those opportunities is putting the right foundational layer in place for effective compliance reporting by implementing a single unified EPM platform, such as OneStream.

Learn More

If your organisation needs to improve the effectiveness of its compliance reporting, maybe it’s time to evaluate your internal systems and processes.  To learn more, download our ebook on Reporting & Analytics.

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Financial reporting is an essential function of any Finance organization.  It provides stakeholders with a snapshot of the financial results and financial position of the enterprise.  You may think that financial reporting is mainly a function of the Accounting group within the Office of Finance, however financial reporting and the related analysis of financial results is an important function of most Financial Planning & Analysis (FP&A) departments.  Financial reporting capabilities are also an important feature to evaluate when selecting a software package to support FP&A as well as the Accounting team.  Read on to learn more.

What is Financial Reporting?

Financial reporting refers to processes and practices that provide stakeholders an accurate depiction of the finances of an enterprise, including its revenues, expenses, profits, capital, and cash flow. The enterprise could be a private or public company, non-profit, government agency, higher education institution, or other organization.

The primary financial statements that are produced through the financial reporting process include the following:

• Balance Sheet – Provides a consolidated view of the assets, liabilities, and capital of the enterprise at a specific point in time.  The balance sheet is typically produced at month-end, quarter-end, and year-end.
• Income Statement – Also known as profit and loss, an income statement is a financial report that summarizes the enterprise’s income, expenses, and profits or losses over a specific period of time. Income statements are typically produced for a specific month, quarter, full year, or on a year-to-date basis.
• Cash Flow Statement – The cash flow statement summarizes the amount of cash that the enterprise has generated (sources) and how the cash is being spent (uses).  It contains elements of both the income statement and the balance sheet, and it is critical to the successful financial management of an enterprise.

Key Stakeholders and Their Requirements

Financial reporting needs to inform and serve the needs of a variety of stakeholders.  This can include external stakeholders such as investors, owners, bankers, public markets, regulators, and boards of directors – who all need to understand the financial performance of the enterprise to guide investment decisions, levy taxes, ensure compliance, and provide advice to executive management.

External stakeholders are typically most interested in the key financial statements mentioned in the prior section, as well as supporting details, schedules, and commentary (e.g., management discussion and analysis) about the financial performance of the enterprise.

Financial reports are also essential tools for informing internal stakeholders about the financial performance of the enterprise.  This can include the CEO, CFO, and senior management team, as well as managers across the enterprise who need to understand how their particular subsidiary, department, business unit, or function is performing in relation to the overall enterprise.  Internal stakeholders are typically most interested in the consolidated income statement of the enterprise, as well as profit and loss reports for their specific area of responsibility.  This is where financial reporting expands to include financial analysis.  This financial analysis delivered as part of internal management reporting may include the following:

• Comparisons of the financial results to the original budget for the period showing positive and negative variances that should be analyzed.
• Comparisons against prior period performance (e.g., prior quarter or same quarter in the prior year)
• Comparisons of revenue, expenses, and profit or loss across subsidiaries, business units, departments, or product lines.

The form these internal financial management reports may take can vary based on the preferences of the internal stakeholders.  Some may prefer printed financial reports or books of reports.  Some may prefer electronic access to financial reports via email delivery, while others may prefer to review financial results through an interactive dashboard (see figure 1), with the ability to drill into key performance indicators (KPIs) or values on financial reports. Financial and operational analysts may prefer to have access to financial and operational results via an Excel spreadsheet so they can slice and dice the data and perform scenario analysis as needed.

The Financial Reporting Gap

Given the demanding requirements of internal stakeholders when it comes to financial reporting and analysis, you might be wondering how well enterprises are doing in meeting the needs of this audience.  Unfortunately, despite the explosion of data across organizations, many organizations still struggle to meet the information requirements of executives and managers because they just don’t have the right tools for the job.

In fact, according to the FSN Future of Analytics in the Finance Function survey from 2020, only 14% of Finance leaders consider their reporting and analytics insightful.  That means 86% of reporting and analytic effort is missing the mark.  Why is this?  Because most enterprises are relying on fragmented silos of spreadsheets, legacy ERP and corporate performance management (CPM) software, data lakes, and BI tool for their reporting needs, which force Finance teams to build disjointed processes around their technology and are not organized in a way they understand.

Reporting and Analytics in CPM Software

Today’s modern CPM software solutions offer a number of advantages over legacy CPM solutions.  They are most often deployed in the cloud enabling faster time to benefit.  They offer specific functionality designed to address the financial close, consolidation, planning, reporting, and analysis needs of enterprises.  And most include robust, built-in reporting and analysis capabilities.  If this isn’t part of the CPM solution you are selecting, then you’ll need to augment the solution with 3rd party BI and reporting tools.

For example, with a broad range of reporting and analytics capabilities, OneStream helps reduce reliance on spreadsheets and fragmented reporting tools to increase the speed, scope, and accuracy of reporting across the organization. OneStream’s Intelligent Finance Platform (see figure 2) unifies finance processes across the office of the CFO while enabling the organization with self-service, easy-to-use financial reporting software for a variety of stakeholder groups. OneStream’s reporting and analysis capabilities include the following:

• Guided Reporting for rapid creation of financial statements
• Production Reporting for pixel-perfect operational reporting
• Interactive Dashboards with sophisticated data visualizations
• Analytic Blend engine which combines detailed operational data with summarized financial data so managers can identify daily and weekly trends and financial signals
• Microsoft Excel® integration for data entry, reporting, and analysis
• Microsoft Office® integration including Word and PowerPoint

Learn More

Financial reporting is an essential function for both Accounting and FP&A functions, and these capabilities are an important factor to consider when enterprises are evaluating CPM solutions for financial close, consolidation, planning, and forecasting.

Over 1,000 enterprises have chosen OneStream’s unified Intelligent Finance platform to support their financial close, consolidation, planning, reporting, and analysis requirements and to deliver timely, accurate financial and operational results to internal and external stakeholders.  To learn more, check out our interactive eBook and contact OneStream if we can be of assistance.

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Today, confidence in data quality is needed more than ever.  Executives must constantly respond to a multitude of changes and be provided with accurate and timely data to make the right decisions on what actions to take.  It’s, therefore, more critical than ever that organisations have a clear strategy for ongoing financial data quality management (FDQM).  Why?  Well, better outcomes result from better decisions.  And high-quality data gives organisations the confidence needed to get it right.  This confidence in data then ultimately drives better performance and reduces risk.

Why Is Data Quality Important?

Data quality matters for several key reasons, as shown by research.  According to Gartner,[1] poor data quality costs organisations an average of $12.9 million annually.  Those costs accumulate not only from the wasted resource time in financial and operational processes but also – and even more importantly – from missed revenue opportunities.

As organisations turn to better technology to help drive better future direction, the emphasis placed on financial data quality management in enterprise systems has only increased.  Gartner also predicted that, by 2022, 70% of organisations would rigorously track data quality levels via metrics, improving quality by 60% to significantly reduce operational risks and costs.

In a report on closing the data–value gap, Accenture[2] said that “without trust in data, organisations can’t build a strong data foundation”.  Only one-third of firms, according to the report, trust their data enough to use it effectively and derive value from it.

In short, the importance of data quality is becoming increasingly clearer to many organisations – creating a compelling case for a change in financial reporting software evaluations.  There’s now real momentum to break down the historic barriers and move forward with renewed confidence.

Breaking Down the Barriers to Data Quality

Financial data quality management has been difficult, if not virtually impossible to achieve for many organisations.  Why?  Well, in many cases, legacy corporate performance management (CPM) and ERP systems were simply not built to work together naturally and instead tended to remain separate as siloed applications, each with their own purpose.  Little or no connectivity exists between the systems, so users are often forced to resort to manually retrieving data from one system, manually transforming the data, and then loading it into another system – which requires significant time and risks lower quality data.

There’s also often a lack of front-office controls that leads to a host of issues:

• Poor data input and limited validation.
• Inefficient data architecture with multiple legacy IT systems.
• Lack of business support for the value of data transformation.
• Inadequate executive-level attention prevents an organisation from laying the effective building blocks to financial data quality.

All of that contributes to significant barriers to ensuring good data quality.  Here are the top 3 barriers:

1. Multiple disconnected systems – Multiple systems and siloed applications make it difficult to merge, aggregate, and standardise data in a timely manner.  Individual systems are added at different times, often using different technology and different dimensional structures.
2. Poor quality data – Data in source systems is often incomplete, inconsistent, or out of date.  Plus, many integration methods simply copy data complete with any existing errors – lacking any validations or governance.
3. Executive buy-in – Failing to get executive buy-in could be due to perception or approach.  After all, an effective data quality strategy requires focus and investment.  With so many competing projects in any organisation, the case for a strategy must be compelling and effectively demonstrate the value that data quality can deliver.

Yet even when such barriers are acknowledged, getting the Finance and Operations teams to give up their financial reporting software tools and traditional ways of working can be extremely challenging.  The barriers, however, are often not as difficult to surmount as some believe.

The solution may be as simple as demonstrating how much time can be saved by transitioning to newer tools and technology.  Via such transitions, reducing the time investment can result in a dramatic improvement in the quality of the data through effective integration with both validation and control built into the system itself.

The Solution

There are some who believe Pareto’s law applies to data quality: Typically, 20% of data enables 80% of use cases.  It is therefore critical that an organisation follows these 3 steps before embarking on any project to improve financial data quality:

1. Define quality – Determine what quality means to the organisation, agree on the definition, and set metrics to achieve the level with which everyone will feel confident.
2. Streamline collection of data – Ensure the number of disparate systems is minimised and the integrations use world-class technology with consistency to the data collection processes.
3. Identify the importance of data – Know which data is the most critical for the organisation and start there – with the 20%.  Then move on when the organisation is ready.

At its core, a fully integrated CPM software platform with built-in financial data quality (see Figure 1) is critical for organisations to drive effective transformation across Finance and Lines of Business.  A key requirement is providing 100% visibility from reports to data sources – meaning all financial and operational data must be clearly visible and easily accessible.  Key financial processes should be automated and using a single interface would mean the enterprise can utilise its core financial and operational data with full integration to all ERPs and other systems.

The solution should also include guided workflows to protect business users from complexity by guiding them uniquely through all data management, verification, analysis, certification, and locking processes.

OneStream offers all of that and more.  With a strong foundation in financial data quality, OneStream allows organisations to integrate and validate data from multiple sources and make confident decisions based on accurate financial and operating results.  OneStream’s financial data quality management is not a module or separate product but built into the core of the OneStream platform — providing strict controls to deliver the confidence and reliability needed to ensure quality data.

In our e-book on Financial Data Quality Management, we shared the following 3 goals for effective financial data quality management with CPM:

1. Simplify data integration – Direct integration to any open GL/ERP system and empower users to drill-back and drill-through to source data.
2. Improve data integrity – Powerful pre-data and post-data loading validations and confirmations ensure the right data is available at every step in the process.
3. Increase transparency – 100% transparency and audit trails for data, metadata, and process change visibility from report to source.

Delivering 100% Customer Success

Here’s one example of an organization that has streamlined data collection and improved data quality in the financial close, consolidation, and reporting process leveraging OneStream’s unified platform.

MEC Holding GmbH – headquartered in Bad Soden, Germany – manufactures and supplies industrial welding consumables and services, cutting systems, and medical instruments for OEMs in Germany and internationally.  The company operates through three units: Castolin Eutectic Systems, Messer Cutting Systems, and BIT Analytical Instruments.

MEC has 36 countries reporting monthly, including over 70 entities and 15 local currencies, so the financial consolidation and reporting process includes a high volume of intercompany activity.  With OneStream, data collection is now much easier with Guided Workflows leading users through their tasks.  Users upload trial balances on their own vs. sending to corporate, which speeds the process and ensures data quality.  Plus, the new system was very easy for users to learn and adopt with limited training.

MEC found that the confidence from having ‘one version of the truth’ is entirely possible with OneStream.

Learn More

If your Finance organisation is being hindered from unleashing its true value, maybe it’s time to evaluate your internal systems and processes and start identifying areas for improvement.  To learn how read our whitepaper on Conquering Complexity in the Financial Close.

Download the White Paper

In a previous blog article, I highlighted the increasing buzz in the market in the past 12 months around the topic of environmental, social, and governance (ESG) reporting and why CFOs and Finance teams are paying more attention to it.  In this article, I’ll highlight why a growing number of organizations are leveraging OneStream to align their ESG reporting with their financial reporting and broader corporate performance management (CPM) processes, and the value that delivers.

ESG Reporting in Focus for CFOs

ESG reporting (a.k.a. Sustainability Reporting) refers to the disclosure of data covering a company’s operations in three areas: environmental, social, and corporate governance. It provides a snapshot of the business’s impact in these three areas for investors, customers, and wider stakeholders. The value of ESG reporting is that it ensures organizations consider their impacts on sustainability issues and enables them to be transparent about the risks and opportunities they face.

For many years, ESG reporting was an annual, voluntary disclosure by public and private companies to their stakeholders about the impacts of their enterprise on the environment and society and how they are managing these programs.  With an increasing amount of capital (now roughly $35 Trillion) flowing into “sustainable” mutual funds and ETFs, there is increasing stakeholder interest in ESG reporting and increasing demand for more detailed and frequent disclosures from public and private enterprises.

As a result, corporate sustainability and climate change efforts are fast transitioning from voluntary to mandatory in many countries, and even the US SEC is moving towards defining clear disclosure guidelines for public companies.  Based on this inertia, there is a clear driver for companies to develop robust sustainability and ESG strategies with transparent reporting to stakeholders.  And this is one of the primary reasons ESG reporting is becoming a hot topic for CFOs and Finance teams.

Aligning ESG Reporting with Financial Reporting

As ESG reporting transitions from voluntary to mandatory it will require the same level of governance, control, accuracy, and auditability as financial reporting.  And since CFOs and Finance teams fully understand how to drive control and accuracy in financial reporting, they are best suited to overseeing the collection, consolidation, and reporting of ESG and data alongside financial results.

While ESG reporting is quickly becoming mandatory, meeting an organization’s sustainability objectives will require a management process that’s similar to the corporate performance management (CPM) process that Finance teams employ to help them meet their financial objectives.  This process includes goal setting, planning, monitoring and reporting, and analyzing results to track progress and make adjustments as needed to stay on track.

As stated by Accenture in a recent survey report on ESG reporting, “Meeting demands for sustainability data will be integral to company performance.  Making a CFO responsible for sustainability is essential for ensuring a company meets its ESG goals.  Companies are much more likely to extensively embed ESG in core management processes when the CFO has accountability for ESG metrics.”

Aligning ESG with Financial Reporting and CPM

While many organizations manage ESG reporting via spreadsheets or point applications, both of these approaches create a data collection, consolidation, and reporting process that’s separate from the financial reporting process. And if ESG metrics need to be reported alongside financial metrics, wouldn’t it be better if this data was collected in the same system and processed as financial data?

The answer is yes, and that’s why a growing number of OneStream customers are extending the usage of our unified, CPM software platform to support their ESG reporting and management requirements.  OneStream’s platform provides several key capabilities that make it a great fit for ESG reporting.  These include the following:

Financial Data Quality:  OneStream can load and validate large volumes of financial and non-financial data such as GHG emissions, water and electricity usage with validations and out-of-the-box drill-down and drill-back capabilities to source data providing ultimate auditability.  OneStream can connect to any source of ESG data as required such as ERP, CRM, HR systems, and internal data warehouses.   The platform can also collect data via flat files, spreadsheets, or data entry forms.

Guided Workflow: OneStream allows customers to design the user experience around the process and apply controls, validation, and governance on ESG data collection, managing the monthly, quarterly, and yearly tasks together.  Customers can also leverage the OneStream Task Manager solution to manage and orchestrate the process further and enable email notifications.

Financial Consolidation:  OneStream can aggregate and consolidate ESG data and textual commentary quickly to provide company-wide results.  With OneStream, your ESG data is consolidated according to the same principles as your financial data, and with the same level of control, governance, and audit trails.  Complex ESG data conversions are supported, along with eliminations and partial ownership calculations. Customers can future-proof their CPM solution to support new standards with unlimited configurable dimensions and hierarchies – supporting GRI, SASB, and other frameworks as required.

Reporting & Analytics:  In addition to financial and management reports, configurable dashboard visualizations (see figure 1) can provide deep analysis of ESG data and turn it into valuable information and insights.  OneStream also supports ad hoc analysis via Microsoft Excel integration, a built-in spreadsheet component, and pivot grids.  Integration with MS Office products enables users to produce and distribute PowerPoint decks, Word Docs, and PDFs with ease.  Data Blending supports reporting and analysis on high volumes of non-financial data.

Planning and Forecasting:  Customers can plan and forecast on ESG with confidence and without compromise. They can set ESG goals and objectives, track Actuals v Target, and provide variance analysis & commentary.  Users can perform what-if scenario modeling to understand the impact of ESG policies on financial results and business value. OneStream supports unlimited extensible data models for any ESG planning process.

Based on these capabilities, OneStream’s platform is well-suited to supporting the collection, consolidation and reporting of ESG data and commentary for internal and external reporting. Much of the emissions data can be found in the local ERP systems and sub-ledgers. For example, energy bills, water consumption, fuel usage is all available on the invoices in the ERP data.  But the formatting, units, etc., are likely all different and there are many other offline or manual data collection processes that need to happen to bring everything together and holistically report on ESG initiatives.

Customers Leading the Way

OneStream has several customers that are already using our platform to collect, consolidate and report ESG data.  One example is a CPG holding company that has grown organically and via acquisitions of many food providers.  When they acquire companies, they let them keep their existing ERP systems as they are all manufacturing companies.  As a result, they have over 50 different GL/ERPs at 100+ locations.

This organization had been collecting data for financial and ESG reporting via spreadsheets and email, so it was highly manual, time-consuming, and prone to errors. They selected OneStream (see figure 2) to collect, consolidate and report their financial and non-financial/ESG data.

 

With OneStream the organization now has one system for actuals, budgets, quarterly forecasts, ESG reporting, weekly operations data, and M&A analysis. Having a single system and process saves time and reduces redundancy in data collection.  Subsidiaries provide a single submission for financial and ESG reporting.  The company has eliminated errors in data collection by using data entry forms with validation checks for key environmental and social metrics.

Conclusion

ESG and Sustainability reporting is rapidly moving from a voluntary to mandatory process.  CFOs and Finance teams need to get engaged to ensure the accuracy and integrity of ESG and sustainability reporting to a variety of stakeholders.  Aligning ESG reporting with the financial reporting and performance management process and system can eliminate duplication, increase accuracy, ensure compliance and improve the overall management of ESG initiatives.

To learn more, check out our white paper titled “The New CFO Imperative: Unifying ESG & Financial Reporting”, or contact OneStream if your organization is ready to align ESG reporting with financial reporting and get ahead of upcoming disclosure mandates.

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For most of us, watching sci-fi films like the Avengers or the Matrix has given us a potential insight into what the future might look like.  We can, therefore, imagine what’s possible and impossible for the next generations. But, we’re also seeing big shifts in what’s possible right now.

With analytics, for instance, we’re now reaching a stage where the technology available today can examine the vast amounts of data within an organisation and begin to predict what will happen next – with high degrees of accuracy.

Advanced analytics have been around for more than 20 years.  What’s new, then?  Why are analytic tools becoming increasingly more common today? Well, the changes in technology and the ability to integrate ever-larger volumes of data into day-to-day business processes are driving increasing interest and the desire to turn the vision of advanced analytics into reality.

Advanced analytics deliver deeper data knowledge and more granular insights.  Accordingly, many more business functions now have a legitimate interest in this capability to help foster better decision-making and improved business outcomes.

Gartner describes advanced analytics across four main types of capabilities (see Figure 1), which are illustrated below:

The questions in Gartner’s model (Figure 1) can be a helpful guide to understanding exactly where your organisation stands regarding the adoption of these capabilities.  Most organisations have mastered the first two questions, allowing organisations to understand what happened and why.  However, many organisations do not have the capabilities in place to predict what will happen.

Is there proof of this?  Yes.  According to the Dresner Advisory 2021 Data Science and Machine Learning Market Study, only 39% of Finance teams are deploying the kind of technologies that enable predictions about future or otherwise unknown events today.  The number of organisations that can then use those technologies to help decide what to do next is much lower.

The Power of Advanced Analytics for Finance

With the sheer volume of data available and advancements in CPM software, Finance teams now (finally) have the capability to interact with advanced analytics.  And do it at scale.

How?  Instead of taking on the burden of building models, Finance teams can rely on purpose-built software to help supplement analysis, reporting, and planning processes with not only high-volume operational and financial signals but also statistically significant, predictive forecasts.

The following advanced analytics use cases can be found across organisations:

• Corporate FP&A – Create daily or weekly financial signals on sales, gross margin, and working capital drivers
• Sales Finance – Seed S&OP processes with predictive forecasts
• Operations Finance – Analyse future labour and material costs with predictive models
• Brand Finance – Extend predictive forecasting by store, brand, department, product category

Through data mining, machine learning (ML), statistical modeling, and other methods, advanced analytics are making industries everywhere more competitive.

Benefits of Advanced Analytics

Advanced analytics offer Finance teams a new way to drive performance – and lead at speed.  If Finance teams spend all their time moving data, reconciling data and building reports, they’ll have no time to leverage the data to guide key decisions.  But by leveraging technology to automate the hard work, Finance teams can shift a larger portion of their time to value-driving activities, such as forecasting cash or evaluating key capital investment decisions.

Advanced analytics tools offer a more accurate and reliable means of looking into the future than many previous tools could provide.  How can that insight help organisations gain a monetary benefit?  Well, retailers can use predictive models to forecast inventory requirements.  Hotels, restaurants and other hospitality organisations can use the capability to forecast the number of guests on any given night to maximise occupancy and revenue.  Airlines frequently use predictive analytics to set ticket prices that reflect past travel trends or account for major events.

Whatever the industry, attracting and retaining customers is important to any organisation, but advanced analytics can bring the opportunity to optimise marketing campaigns to nurture customers.  In turn, new purchasing opportunities can be surfaced to deliver continuous value.

OneStream Delivers Advanced Analytics

OneStream unleashes the power of Finance by unifying planning, financial close & consolidation, reporting, and analytics through a single, extensible solution.  We empower the enterprise with financial and operational insights to support faster and more informed decision-making – all in a platform designed to continually evolve and scale with the organisation.

OneStream’s comprehensive corporate performance management (CPM) software platform helps Finance teams access, maintain, validate and visualise data – all within a seamless and unified experience.  And in doing so on both governed financial and high-velocity operational data, OneStream provides a foundation for Finance-owned transactional analysis, reporting and sharing predictive insights.  Those insights then allow organisations to find new ways to ask ‘why’.

OneStream’s advanced analytics strategy includes key capabilities to enable Finance and business leaders.  Here are a few of those capabilities:

Analytic Blend

OneStream provides a unique ability to ‘blend’ validated financial data, highly dimensional operational data, and detailed transactional data in one platform for comprehensive, controlled, and consumable analysis and visualisation.  Easily combine financial, operational, and transactional data in a single dashboard for comprehensive visualisation and analysis.  With Analytic Blend (See Figure 2), Finance maintains one source of the truth for data, extending access to line-of-business managers and executives while eliminating data latency and the unnecessary replication of financial data for analysis.

Predictive Analytics

OneStream empowers Finance teams to lead at speed by unifying predictive analytics with core CPM processes: planning, budgeting, and forecasting; financial consolidation; reporting; and financial data quality.  And with built-in predictive analytics (see figure 3), OneStream is unleashing Finance transformation to take budgeting, planning, and forecasting processes even further – allowing teams to plan, analyse and predict with confidence.

Machine Learning

OneStream’s sensible ML solution will provide Finance teams with the power to leverage ML models without extensive work by data scientists.  This solution will take users through a step-by-step process for each part of the ML model-building and deployment process. Including feature engineering through advanced algorithm configuration, training, and deployment.

Creating value from advanced analytics in Finance and beyond could make a significant difference to your organisation’s performance.  What if you had the power to incorporate advanced analytics directly into your day-to-day business processes?  What if you could conquer the complexity of gathering and organising financial and operational data? Or creating and maintaining predictive forecast models?  Let the right technology help you to view the possible and impossible for the future of your organisation.

Learn More

If your Finance organisation is being hindered from unleashing its true value, maybe it’s time to evaluate your internal reporting & analytics and start identifying areas for improvement.  To learn more, view the OneStream advanced analytics interactive e-book.

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