Having data silos is a common problem for many businesses that have started leveraging data and embracing full digital transformation for their processes. It can put massive constraints on your business, making certain information inaccessible or “invisible” within the organization. As a result, it can cause potential delays, misalignments, and misunderstandings during operations.
Operational efficiencies can be significantly improved by combining operational and financial data. There are many benefits to integrating data. It can make your processes more streamlined and transparent across all departments within your organization. In fact, a study by Deloitte shows that businesses that have unfettered access to their operational and financial data have improved their ability to forecast with 20% improvements in accuracy, 10% improvement in their on-time deliveries and 6% improvement in overall revenue growth.
Here’s how you can create a business process optimization strategy by combining operational and financial data.
1. Provide single source of truth
Dealing and analysing data coming from different sources using spreadsheets time consuming, inefficient and error-prone. There is a good chance you might end up with inconsistent data, which can lead to inaccurate insights and reports leading to the wrong conclusions and incorrect business decisions being made.
By combining your operational and financial data, you can provide a single source of truth for everyone within your organization. It makes information more accessible across the different departments, allows you to quickly iterate as required and provides you with greater insights by having data combined from multiple sources appearing in one report without the need for you to undertake this step manually in spreadsheets. You can now effectively have all your data in one source and on one report.
This ensures that everyone is using the same data for their own analysis and reporting while also boosting transparency and accountability within the organization. So now, you can have complete, accurate, and more updated information to help you create better operational improvement strategies for the company.
2. Automate data extraction and analysis
Manually combining and analysing data can be challenging especially when you are handling a lot of them. It can be costly and time-consuming as well. Hence, you should consider automating data extraction and analysis within your processes. Nowadays, there are various software solutions you can use to help you leverage better data and analytics. There are business intelligence solutions, enterprise planning resource (ERP) systems, data management solutions, and more.
One great example is Essatto. This software can help you combine and load data from multiple sources and then blend the data for reporting and analysis. It allows you to combine data easily and produce dashboards to present your analysis and forecast cost-effectively. As a result, it empowers you to centralize “all” organisational data to gain new and better insights from your business processes.
3. Breaking down data silos
Data silos occur when a collection of data is stored by one group or individual (e.g., spreadsheets) but is inaccessible to others. Within an organization, data tends to be organized by respective departments. For example, financial data is handled by the finance and accounting team. Meanwhile, operational data can be found in several departments such as customer service, human resource, and supply chain. The more data you have, the more these silos continue to grow too.
This “Silo” effect has been further complicated by the advent of the Cloud. Historically this issue was largely contained to on-premises applications interconnected through the same corporate network however this has been magnified with more and more applications now being cloud based. These silos have become more complex with different applications being stored on different Cloud platforms in different geographies. Products like Essatto break down these Cloud Silos through the use of API’s and other means simplifying access and giving organisations the ability to combine data sourced from BOTH on-premise and Cloud based applications and make it accessible to anyone in the organization.
4. Improve business forecasting
Merging your operational and financial data provides you with key information that can be leverage for creating more detailed and accurate forecasts. It will help you anticipate trends, future business needs, and potential outcomes allowing you to improve and evolve your strategies to prepare for the future.
Combining Financial data with Operational data provides you with the ability to generate “Hybrid Key Performance Indicators” such as cost per hour of operating a machine, or labour cost per hour of each stage in a production line. These types of KPI’s provide businesses with insights that can leads to improvements in efficiency and can be used in producing forecasts that can be more confidently relied upon.
5. Promote collaboration
Having an integrated data analytics platform for capturing and storing operational and financial data paves the way for a more streamlined and transparent collaboration within your organization. It ensures that all your teams—from finance to sales to operations—strategically have their goals aligned and can efficiently undertake analysis and complete tasks.
Having centralized dashboard and reporting can provides your teams with “window” into this centralised data facilitating instant visual presentation and analysis. Allowing data to be displayed from different teams and departments within the organization effectively breaking down the silos.
A perfect combination
Data plays a critical role in keeping your business competitive and relevant in the market. And through integrated operational and financial data, you can further streamline your processes and boost business performance.