Spring Cleaning for CFOs: Time to Clean Up Your Financial Systems
April is just around the corner and the first day of spring is mere weeks away. And with it brings the time-honored tradition of spring cleaning. No, we don’t mean giving your desk thorough dusting (although, it’ll feel good after you do that too). We’re talking about cleaning up business practices that could really use it, specifically tidying up those that are falling behind the curve due to outdated technology. CFOs using spreadsheets, we’re looking at YOU.
According to a recent study by SAP and CFO Magazine, more than two-thirds of financial executives noted that in the last five years, it has become harder for a company to maintain a competitive advantage in its respective market. There’s no doubt that CFOs everywhere are feeling the pressure to contribute more to the overall success of the business. But they certainly won’t get there by maintaining the current status quo.
Worse yet, 59 percent feel that maintaining this competitive advantage is only going to get more challenging in the coming years.
One glaring area that needs improvement, noted by CFOs, was data migration. Respondents felt IT systems should be doing more to automate processes, and 83 percent of respondents believe their companies would financially benefit from devoting less time, attention and resources to data migration and manual reconciliation. This is a pretty insurmountable task when companies are still using spreadsheets to manage many of their critical processes. For instance, it’s estimated that 85 percent of companies are still using spreadsheets to manage sales compensation. Not only does this cause costly accounting errors and demotivate sales reps from reaching their true potential, it silos critical information between systems that could give new intelligence and opportunity to the business.
For a CFO, that can be a huge problem. For example, if sales applications such as CRM, incentive compensation and finance systems aren’t tightly aligned and constantly sharing information, it’s hard to get a accurate picture of projected sales and sales commissions. This can throw off overall financial numbers. In the worst of cases, this can cause earnings-per-share projections to be materially off target, which of course rebounds on the company’s stock price and on the CFO’s reputation. The jeopardy here isn’t just confined to bad quarters. A company can have a great quarter with most of its reps overachieving, and end up with an enormous expense shortfall as a result.
The result of poor data integration equals poor forecasting and projecting. And the risk is simply not worth any possible reward spreadsheets can offer.
Armed with this automated, data-driven sales compensation management platform, CFOs can clean out outdated, inefficient processes and gain the intelligence and agility they need to gain the competitive advantage they’re seeking.
CSO Insights – Sales Management Optimization Study
This report shares key trends and best practices for sales compensation and performance management, as well as insights based on company size, industry, and annual revenue.