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10 Reasons Why Your Company Needs Good Financial Data
Data plays an essential role in business. Gut instinct and guesswork just aren’t going to cut it. Your company needs data when you set budgets, analyze performance, choose investments, and make strategic decisions.
Because of how important data is, your company needs access to good-quality data. It’s not enough to just pull up some numbers from last year. Data needs to be accurate, complete, timely, and accessible. To get quality data, your company will need to invest in data collection and analytics. This is one of the many ways that business process automation (BPA) software can benefit your company.
There are a host of reasons why it’s smart to invest in collecting quality financial data. Data supports informed decision-making and strategic planning on a company-wide scale. Quality financial data supports smaller-scale projects and decisions as well. In this article, we’ll look at 10 of the reasons why your company needs access to good financial data.
1) Make Data-Informed Decisions
Solid data lays the groundwork for sound financial decisions. When your company has access to accurate and timely data, then leaders can make decisions informed by the facts. Decisions will be better informed and more useful strategically when based on accurate data and analytics rather than estimates or guesses.
2) Improve Predictions
You can never guarantee accurate predictions, but the better your data is the more useful predictions can be. As your company collects financial data, you’re getting insights into the past and present state of finances that can inform predictions about the future.
3) Discover Financial Trends
Looking at data over time allows your company to discover financial trends. You’ll be able to see if there are seasonal spikes in spending or revenue, if certain suppliers are more reliable than others, and much more by looking at data trends over time. The longer you use a BPA software system to manage financial processes, the more data it collects and the more you’ll be able to identify trends.
4) Keep Policies Relevant
Policies only help your company if they’re relevant and people follow them. Examining data lets you see which policies people follow consistently and which ones might need to be updated or clarified. NextProcess automation solutions make it easy to enforce and update policies. You can customize a lot of policy compliance into the software itself, so employees using it automatically follow your company’s rules. This feature also makes it easy to update policies; simply update your customizations to the software and it’ll help employees remember the new policy.
5) Improve Cash Flow Visibility
Automation software improves visibility into your financial processes. In addition to providing better data, this gives you a more accurate and up-to-date view of cash flow. The system updates in real time so you can always check the current state of finances. This to-the-minute financial data is invaluable when someone has to make a snap decision.
6) Streamline Audits
Easy to access, reliable data makes audits much easier. Automation software logs every piece of digital paperwork, metadata about financial transactions, communication regarding processes, and all the steps or changes a process goes through. For a business purchase, for example, the software will log the purchase order, PO acknowledgment from the vendor, goods received document, invoice, and payment documentation in addition to transaction details such as date and time for the different processing steps. This leaves a clear, complete audit trail.
7) Make Bids for Travel Discounts
Better financial data helps on a broad, company-wide scale, but it’s also useful for individual departments. When managing travel and expenses, data can support your company’s efforts to negotiate discounts. For example, some airlines offer discounts to companies that use their services regularly. Good records let you prove that your company uses a service, making it possible to apply for discounts.
8) Negotiate Early Payment Discounts
Procurement might also be able to use data to negotiate early payment discounts. When you automate purchasing and accounts payable, the software systems work together to streamline the procure-to-pay process. It also automatically logs the data you’d need to prove that your company has a history of reliable payments and to prove which suppliers you use most often. This gives procurement the data they’d need to possibly negotiate early payment discounts or other benefits.
9) Analyze Purchasing and Expenses
Implementing procurement automation software makes purchasing easier for employees while also reducing the problem of non-compliant spending. With more spend under management by the procurement department and software automatically collecting data, your company will dramatically improve spend visibility.
10) Better Manage Capital Projects
When managing capital expenses and capital projects, you need accurate data to create a realistic budget or manage project activities effectively. Long-term capital projects always involve a certain amount of forecasting. The more accurate your data, the more accurate your forecasting before and during the implementation of capital expenditures. Access to up-to-date data on the status of capital expenses also makes managing CapEx much easier and helps your company take control of CapEx spend.
Use NextProcess for Improved Data Collection and Management
BPA software helps support all these data goals. This software is designed to reduce errors and capture accurate information, ensuring data accuracy. It also logs all the information about financial processes, giving your company more complete data sets. When you go with cloud-based BPA software, it updates in real time and provides the timeliest financial data possible. Finally, digital data management features make the data that the software collects easily accessible.
NextProcess software includes tools to run reports and easily see granular or big-picture data. You’ll still want to employ people with data science skills to analyze and present the data in the most useful way, but automation software gives them a huge advantage by making sure the data is accurate, complete, timely, and accessible.
