Every day in almost every modern business around the world, employees and managers are looking at reports. Depending on roles and responsibilities, these report consumers are seeking an understanding of a particular area of the business by reviewing vendor reports, sales reports, inventory reports, financial statements, and more. The faster an employee can find the answer they are looking for and then move on with their day, the less time is wasted and the faster any potential action items resulting from the analysis can take place.
Take this example: A majority of corporate and government organizations have department heads with budget responsibilities. Typically, the accounting department will run departmental financial statements once a month and distribute them out to each department head for review. The department manager will then look at the actual and budget figures and pay particular attention to the budget variance column. He or she knows that if there is a big budget variance, there is some explaining to do. However, in order for variance explanations to be provided, the manager needs to understand why the variance occurred in the first place. So, next starts a process of contacting accounting and asking for detailed transactional data for the revenue or expense items that had the big variances. In most organizations, this process can take days and will involve several people and back and forth communication. In other words, it is a slow, costly and clumsy process.
Now, how should the above process work in an ideal world? Here is an example:
1. The manager runs the report on-demand (accounting no longer needs to run and distribute it).
2. The manager reviews the report and easily spots the variances that the company has agreed are significant. E.g. those that are more than 10% above/below the budget. These variances stick out clearly in the report because they have red traffic lights next to them.
3. The manager clicks on each number in question and drills down to the general ledger (GL) detail. If more information is needed, the manager drills from the GL detail and into the related sub-ledger detail, e.g. to see the line items on a purchase order or a sales order.
4. Armed with the same knowledge as an accountant sitting with the accounting system open all day, the department manager now knows why the budget variance occurred and instead of e-mailing the CFO or asking for a meeting, he or she simply enters the explanation in a comment column on the report and saves it to the database so the comment is stored for years to come.
The whole process above took 5-10 minutes instead of 5 days, and not only did the organization save time, money and sometimes frustration, but business decisions can be made quicker as a result of the automated self-service reporting, the drill down and drill across to sub-ledger detail and the comment feedback that could be stored for later retrieval.
Modern tools like Solver’s BI360 business intelligence suite can provide the full automation and self- service reporting that was described in the above example.