Chief financial officers are expected to surpass organizational revenue goals, protect cash flow, arrange favorable contracts, cut wasteful spending, and perform various other high-level tasks to support the company’s bottom line.
While a talented CFO will be capable of fulfilling all of these responsibilities and more, they need their organization to support them. Specifically, they need to have exceptional visibility into their corporate entity data.
Find out why CFOs need more corporate entity data visibility and how you can give it to them.
4 Reasons CFOs Need Better Financial Data Visibility
When CFOs are supplied with an abundance of entity financial data, they’re able to accomplish the following mission-critical objectives:
1. Pursue Digital Transformation
Businesses across virtually every industry are looking for new ways to increase efficiency through the strategic use of leading-edge technologies.
While pursuing digital transformation is certainly worthwhile, implementing new tech requires a significant investment of time and resources. The CFO is responsible for helping other decision-makers determine when, where, and how to innovate.
To effectively fulfill this role, the CFO needs visibility into corporate entity data. They must be able to peer in and look at the big picture so they can accurately identify areas of need and determine what resources are available.
2. Increase Organizational Resilience
Risk mitigation is one of the most important functions any CFO is tasked with.
Mitigating financial risks and optimizing organizational resilience have become more important than ever amid ongoing financial uncertainty and volatile economic conditions. The problem is that a CFO can’t effectively weigh financial risks, much less predict or minimize them, if they don’t have access to relevant subsidiary data.
Increasing financial data visibility empowers the CFO to protect cash flow and strengthen reserves in the spirit of preserving business continuity. They can work with other top-level decision-makers to prepare for market downturns or sudden shifts in consumer behavior.
3. Scale Revenue
Increasing entity data visibility will also help the chief financial officer scale both revenue and revenue protection strategies.
As part of their efforts to scale revenue, the CFO can identify and eliminate common sources of financial waste. They can also pinpoint new investment opportunities or avenues for growth that align with the organization’s long-term goals.
When a CFO has access to comprehensive entity data, they can more effectively pinpoint the company’s financial weaknesses and strengths. They can use these insights to develop winning strategies that lead to economic success.
4. Streamline Critical Processes
By nature, tracking cash flow and engaging in long-term financial planning are complex, time-consuming undertakings. However, completing these essential tasks can feel impossible when a CFO lacks sufficient corporate entity visibility.
When your chief financial officer has access to adequate information, however, they can carry out these tasks more efficiently and support decision-making processes. They can create detailed financial plans that account for a wide range of market variables and ensure that all of the organization’s entities receive strong cash flow.
How to Improve Financial Visibility Across All Entities
Improving financial visibility across all entities and subsidiaries can be challenging. However, there are a few tried-and-true tactics you can use to illuminate your entity data for your CFO.
To optimize visibility, start by completing the following tasks.
Facilitate Real-time Reporting with Dashboards
Investing in reporting technology that includes customizable dashboards is a great way to make your entity data more accessible. A top-quality reporting tool will allow the CFO to track high-level metrics, as well as more granular key performance indicators specific to a particular department or entity.
Financial dashboards ensure that CFOs can obtain a holistic view of the organization or one of its subsidiaries at a glance. Since the dashboards are updated in real-time, they'll also be able to obtain up-to-the-minute status reports on the state of the business.
Increasing the chief financial officer’s awareness of the company’s financial health is the first step to protecting revenue and bolstering cash flow.
Tear Down Data Silos
A data silo forms anytime data is ingested by and stored on one platform but not shared with other systems. Data silos are extremely common among organizations that manage multiple entities. And they’re not just the enemy of visibility — when left unaddressed, they can also impede decision-making.
If you want to empower your CFO and improve visibility, you need to tear down data silos. This means integrating your various software tools and designating a centralized location to store and manage entity data.
Track the Right Metrics
Consolidating your data and eliminating silos is definitely a step in the right direction. However, moving all of your information to one location can also lead to data overload for your CFO. This is especially true if each entity and subsidiary is tracking and reporting on a different set of performance metrics.
To avoid information gridlock, it’s vital that you identify and track a standardized set of metrics across all entities. This approach allows the CFO to monitor the health of each entity, identify perennial underperformers, and make financial decisions that move the business closer to its goals.
Sunset Antiquated Entity Management Software
Antiquated entity management platforms lack the tools and functions organization leaders need to thrive in the modern business environment. The only logical solution is to replace these aging tools with a cloud-based entity management solution that’s feature-laden and highly scalable.
Top entity management software solutions will serve as a single source of truth for all of your entity data. They also feature robust reporting tools that give the CFO unmatched visibility into your entity data.
Among other things, these solutions can track the performance of individual subsidiaries, expedite financial planning and forecasting, and engage in data-driven decision-making.
Tear Down Visibility Barriers with Athennian
Increasing CFO visibility into corporate entity data requires the right software and a great strategy. While devising the strategy falls on your shoulders, Athennian can provide best-of-breed software that makes life easier for your CFO, legal, and tax teams.
Ready to learn more about Athennian? Connect with one of our entity management experts today to book your demo.
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