Are businesses aware of how to use financial insights?
Many companies seek assistance when it comes to making financial decisions but new research has suggested they may not be making the most of what they are told.
Deloitte’s annual survey of senior financial officers has revealed that more than half of organisations fail to consistently use the insight from financial business partners when making decisions.
This could potentially cost firms vast sums of money, especially if finance departments are not looked upon as trusted sources of information.
Trusting your business
More than half of these departments are viewed as a trusted source, but only 8% of organisations say they provide a primary source of insight.
This could mean that opportunities are missed or overlooked, something that could potentially disrupt bottom line finances.
Part of the issue is that the insight that is provided lacks sufficient context or detail which restricts how it can be used when decision making.
Some 42% of firms provided details but no context so working out how information is relevant is therefore very difficult for a particular business.
Simply providing data is one thing but developing it further to provide guidance can make all the difference for firms trying to understand their situations.
Matching insight with context
Such assessments could also identify any potentially troublesome areas of the business or may even suggest that business rescue is required in some circumstances.
Rapid actions can be essential where financial losses are concerned as businesses should want to limit any negative impacts.
Focusing on business performance and what drives success will be crucial, as in depth financial insight should suggest ways of making it possible.
This should help create motivated and driven individuals who are fully aware of the financial aspects of a business and who are then well placed to encourage success.
Clear guidance should be given to finance departments and those supplying insight and any targets and goals that are created should challenge businesses towards success. Failing to do so could mean missed opportunities and even financial losses; something that companies should want to avoid at all costs.
By Phil Smith