Financial Reporting with Dynamics AX for Retail Companies

If you’re part of a Retail organization’s finance team and you’re using Microsoft Dynamics AX for your accounting processes, this article is for you, discussing your financial reporting software options.

Financial reporting is arguably the centerpiece of Business Intelligence (BI) analytics as they summarize the financial health of an organization in a hopefully easy-to-read set of financial and operational statements.  Business is moving at quite a rapid pace today, and Retail is no different.  Enterprise resource planning (ERP) systems, like Microsoft Dynamics AX, typically offer financial reporting functionality built right into the program.  However, with the need for more complex, robust data analytics – and now, industry-specific reporting – the native report writing usually falls short of consumer needs.  This article will discuss your third party options for modern, powerful, and business user friendly financial reporting solutions, offering Retail organizations the information they need to make stronger decisions about the future of their company.

Let’s begin by talking about financial reporting tools in general, and then, we’ll zoom in on Retail reporting specifically.  First of all, you should know that you have more and more options because third party reporting tools are becoming more popular with their consumer-driven features and functionalities.  You should be looking for three main criteria in a tool that can help you modernize and streamline your financial reporting process: ease of use, flexibility, and security.  We’ll use these three characteristics to discuss what you should be considering in a financial report writer – integration options; Excel, proprietary, and/or Web platforms; mobile applications; and going with a full suite of BI tools versus a stand-alone report writer.

You can integrate your data from multiple sources – and in different ways.  Whether it’s accounting information from Dynamics AX or data from Point of Sale (POS) systems, you can choose to integrate directly from the source with some modern financial report writers, or you can go the BI data store route.  The latter is often recommended with AX 2012 and later versions.  Reporting live from a data source translates to real-time analytics for more urgent or ad-hoc deadlines, but it can also mean a sluggish Dynamics AX server, depending on how many users are querying substantial data sets potentially at the same time.

If you choose to implement a BI data store, like an online analytical processing (OLAP) cube or a data warehouse, you are going to achieve a higher performance without slowing down the server, but you will have to replicate your data to the storage space, and the device will be an additional investment.  Furthermore, with an OLAP cube, you will need personnel with OLAP-specific experience and skills to manage it.  Regardless, you will need to analyze your specific Retail business needs and evaluate how certain reporting products offer you the business user friendliness and secure flexibility you need.

Another major consideration: technology platform.  Finance departments around the globe have been using Excel for decades, so Excel add-ins take the popular spreadsheet program and upgrade it with power and modernity for robust Retail reporting.  On the other hand, proprietary platforms have made a space for themselves in today’s market as well – usually with the claim that Excel is a pain, in terms of manually linking together spreadsheets, formatting, and back-and-forth e-mail threads.  Modern Excel add-ins transcend all of those issues by accelerating the program, but the current platform trend is all about the Web.  Web-based reporting, whether on-premises or hosted in the Cloud, has offered today’s businesses the flexibility of accessing, managing, and analyzing data from anywhere you can connect to the internet.  And the flexibility doesn’t have to stop there.  One word: hybridity.

There are a few reporting products that offer hybridity in terms of being powered by Excel and also staged online, as well as some even offering a mobile application.  If your retail organization has multiple locations, a spread out team with both remote contributors and road warriors, the Web offers you a secure and flexible way to stay connected and informed.  Excel provides the ease of use related to the international familiarity for finance departments, so when Excel formulas and formatting drives the flexible online access, it makes for quite a product that can generally service the finance world.  Again, you have to weigh your software options with your specific needs, but flexibility and more specifically, hybridity, is arguably the future.

Flexibility has a lot to do with mobility in the modern business culture.  With professionals at all levels of a Retail organization potentially on-the-go or out of the office or store, the ability to get to your data and contribute in decision-making processes is extremely valuable.  Mobile reporting applications are relatively new and definitely rare at this point, but some independent software vendors (ISVs) are producing apps for the on-the-go executive or controller who needs access to a report while waiting in line at the airport or visiting a client overseas.  So far, the functionality is limited to just report viewing and usually, one KPI at a time because of the screen size, but you’ll want to pay attention as this area of financial reporting is only going to expand because of how close we keep our mobile devices.

Let’s talk about Retail reports.  Typically, Retail reports combine POS information with General Ledger (GL) data, sometimes with operational figures like inventory.  Depending on the structure of your company and your analytical needs, you can organize your analyses by region and business unit or store.  You might run operational reports more frequently, perhaps relying on a data warehouse or an OLAP cube, but you could also integrate live from Dynamics AX.  These routine reports usually zoom in on sales and margin by personnel, region, business unit, and/or product, and should provide drill-down capabilities to move to a transactional level, which are used by the sales team.  Financial reports for Retail can vary in subject, but you might want to analyze customer retention and satisfaction, point of purchase, cost of goods sold, incremental sales, average purchase value, sales per square foot, etc.  The historical figures in financial reports usually relate directly to sales forecasting, which brings us to full BI suites.

You might be in the market specifically for upgrading your financial reporting processes right now, but if your roadmap includes or should include an overhaul of other BI tasks, like budgeting, dashboards, and data warehousing, you should really consider investing in a report writer that is part of a fully integrated suite of BI tools.  As opposed to a stand-alone product, you can more easily, flexibly, and securely manage your tasks with the support of one team of vendor, partner, support and consulting professionals.  Lots to consider, but Solver, Inc. is happy to answer questions and generally review BI360’s easy-to-use Excel, web, and mobile platforms for real-time or data warehouse integrated analysis and collaboration, with the option of email distribution of reports, as the best report writer for Retail organizations using Microsoft Dynamics AX.

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