Spring is when many companies announce first-quarter results. If your company is one of them, you’re hoping to inspire investor confidence with results that show healthy growth and progression.
Of course, profit and loss is just the surface of the ocean when it comes to what first-quarter numbers tell you. Finance leaders who dive deep enough can use first-quarter results to improve productivity, mitigate risk, increase cost-effectiveness, and capitalize on emerging opportunities.
You used to have to wade through spreadsheets to find the data you were looking for to drive these financial decisions, which meant this task often took a backseat to profit and loss. Today’s automation possibilities enable you to get investors the information they need without sacrificing the information you need, just by accessing the data in your compensation management software. If you’re not already using first quarter-data to drive financial decisions, here are four reasons why you should consider doing so:
- Increase accuracy of financial reporting, decrease turnaround time. It’s hard to keep up with constantly changing accounting rules and financial reporting standards. Real-time access to accurate data, analytics, and reports ensures you adhere to standards and rules, even with reduced staff.
- Know what your customers demand. Your customers tell you exactly what you need to know about current and potential revenue streams, so listen! Where did revenue grow and where did it decrease? Use real-time info to make decisions that determine how much you spend on each product and service, and to capitalize on emerging opportunities.
- Assess and mitigate risk. If you know yourself and know your enemy, you’ve got nothing to fear, right? Identify your “enemies” — uncertainty in markets, project or service failures, competitor behavior, credit risks, and other events. Then, develop risk-reduction strategies and align risk within the organization goals.
- Make more accurate projections. What does the future look like? Use first-quarter data to make an educated guess on future growth, profits, staffing requirements, and expenses. Then, set goals that are challenging but within your capability, and build financial models that show how goals will be reached.
If you are a financial leader looking to make decisions that drive growth, cut costs, and improve profits, the details are in the data. For more information on how automation can drive financial decisions at your organization, read Out of Breath in the “Last Mile” of Finance? Three Good Reasons to Automate.