Financial leaders know the importance of accurate data, and as technology improves, so do the processes for obtaining and analyzing that data.
The financial industry is increasingly embracing an enterprise-wide approach to Corporate Performance Management (CPM). Financial reporting provides insight into the financial health of the organization, but CPM takes an even deeper dive, allowing organizational leaders a broader opportunity for analysis and stronger decision-making. And, by sharing this data with leaders of the organization outside of the finance department, stronger, more informed decisions can be made among the executive team.
What is CPM?
CPM is an area of Business Intelligence (BI) that takes a comprehensive look at organizational performance, including (but not limited) to financial performance. CPM monitors and manages organizational performance according to detailed forecasting and comparisons, allowing organizational leaders foresight into pipelines, analysis, and even customer or member satisfaction.
CPM is widely used enterprise-wide and includes budgeting, forecasting, dashboarding, and scorecards. The push for transparency in organizational performance and organizational goals serves the corporate landscape as decisions can be made cross-departmentally with all department leaders. This can facilitate better, stronger decisions while keeping all organizational leaders apprised of the current data, performance, planning, and forecasting.
Along with organizational performance, CPM software allows stakeholders to draw comparisons to the performance of peers and competitor organizations. However, quality data is of the utmost importance in order for accurate projections and comparisons. Financial reporting is traditionally Excel-reliant, but extremely complex processes like budgeting, forecasting, and consolidation, are best handled by CPM software due to the lower probability for manual errors. Data quality tends to be higher in CPM systems as opposed to spreadsheets, which have been historically prone to manual errors.
A single repository for data to be housed is considered a best practice in the industry, as it ensures accuracy and validity of data.