Today’s global organizations have access to millions of data points. This also means that many organizations have found themselves swimming in data, especially if they do not follow data management best practices.
Technology has made it much easier to generate data down to the millisecond, which has created the challenge of trying to make sense of the data to drive decision-making.
Nowhere is this more evident than in the financial sector, where managing a massive amount of financial data is a growing challenge when trying to deliver accurate reports and make informed decisions that could have ramifications for years to come.
Why Data Management is So Crucial in Corporate Finance
For globally-entrenched organizations, the proper management of financial information is crucial for the purposes of reporting, compliance, and operational efficiency.
– Organizations that span multiple countries and continents need to be able to produce standardized breakdowns of earnings and cash flow in multiple currencies.
Then, the organization needs to be able to accurately convert financial records into a singular currency for the purposes of profit and loss statements (internally), financial reporting for investors (externally), and tax purposes.
– Compliance laws are constantly updated around the world. While marketing and consumer-driven data needs to be accurate, financial records need to be meticulously accurate. Any errors in reporting can lead to an audit, which could be costly and time-consuming for your organization.
– To achieve efficient operations, organizations need reliable data management processes to ensure that cash flow is measured accurately and precisely.
An organization that cannot achieve an accurate view of earnings and spending for a given period of time will be challenged to maintain stability in today’s ultra-competitive business environment.
The Best Practices for Financial Data Management
After gaining an understanding of the value of data management, consider the best practices to support financial data management in your organization.
It’s important to note that data management best practices apply across the board, even to smaller-to-medium-sized organizations. As these organizations grow, it’s best to already have a foundation of best practices that can support your organization during a future growth phase.
1. Build a Data Structure
Financial data quality management starts with a clear structure. One of the most prominent reasons why data can become unwieldy is because of disorganization and poor structure at the corporate level, the subsidiary level, or the business unit level. This can be as simple as naming convention or as complicated as data drillbacks.
If the corporate office is following different data protocols than business units spread across the globe, or vice versa, it can become virtually impossible to maintain data standards.
To overcome this common challenge, organizations need to create and implement a standardized format for Financial data collection. A companion piece is standard, defined, and repeatable processes. Then, organizations need to hold personnel accountable for following the processes to ensure data integrity.
2. Eliminate Redundancies and Siloes
As organizations grow, there is risk of data management becoming fragmented:
- A new business unit may try to manage financial data on their own.
- An acquired company may try to hold onto their way of managing financial data.
- Newly-hired personnel may not understand the importance of following data management best practices.
Financial data that is not aligned with the organization’s foundational structure creates headaches such as conversion requirements, accuracy and compatibility issues, and reliability concerns.
Instead, organizations need one immutable record that serves as the master ledger. Rather than trying to compile data from all sources and keep track of each critical piece, the master record should be the primary resource for all business units and employees to utilize.
Fortunately, cloud technology enables businesses to make this record accessible across the enterprise, meaning that there is no reason for outdated or incorrect copies to exist on specific computers or devices.
Also, a single master record ensures that the data management team only has to maintain strict standards in one location. As long as other business units feed their data to the master, the system will be much easier to manage.
3. Create a System of Efficient Data Disbursement
Once an organization has created a master ledger and a highly structured system of data retrieval and storage, the organization also needs to develop a method of distributing data across the enterprise to support decision-making.
A common challenge is that different business units and personnel may be accustomed to using different software to read, write, and compile data. If there is a software disparity within the organization, it could lead to data discrepancies, frustration, and misuse.
The ideal solution is utilizing a single platform to support financial data management — from collection to storage to dispersal. This way, data does not to be translated, converted, or copied from one software application to another application, ensuring that the organizational financial data standards are always followed.
Consider OneStream XF to Support Financial Data Management
OneStream XF supports each aspect of an organization’s financial data management needs by providing strict audit controls and standard data processes for maximum confidence and reliability in a business user-driven process.
The platform includes Guided Workflows focused on helping organizations achieve financial data quality management and verification throughout financial consolidation, reporting, and planning processes.
The Guided Workflows include end-user focused processes to standardize and simplify data collection and analysis across the enterprise. It’s a simplified, smart approach to ensure that everyone in the organization adheres to data management best practices at every step in the process.
Plus, OneStream delivers fast and efficient direct-to-source system integration processes. The OneStream XF Integration Connectors offer direct integration with the master ledger to support drill downs, drill backs, and drill throughs to transactional details, including journal entries. This ensures financial accuracy and integrity in alignment with organizational best practices.
Work With HollandParker to Support OneStream XF Migration
As a Diamond OneStream Implementation Partner, our CPM consulting firm has intricate knowledge of how to align your organization’s data management best practices with the capabilities of the OneStream XF platform.
The result is increased confidence in financial and operating results through a reliable data integration process and data management structure.
We would appreciate the opportunity to discuss your data management needs and outline why OneStream Software is the ideal solution for modern business.