
Most organizations struggle to find the right data to make informed business decisions: 61 percent of users find it impossible, difficult, or somewhat difficult to locate analytic content. These data highlight the ongoing challenge of effectively organizing and making analytic content easily accessible to users. Data leaders need to ensure they leverage capabilities that expose key business and analytic content to users and decision makers in easy-to-consume ways.
Financial key performance indicators (KPIs), financial master data, and financial data are important analytic content. For example, our survey respondents consistently rate financial KPIs as the most important KPIs in an organization. Financial KPIs and other financial analytic content are managed through financial consolidation, close management, and financial reporting (FCCR) capabilities, which create a consistent and auditable source of financial master data and financial analytic data. Because FCCR capabilities can draw data from multiple transaction systems, they provide the best way to link financial data with other enterprise data through data catalogs and other data management capabilities. Our latest research shows that 63 percent of organizations that use FCCR find it relatively easy to access analytic content, compared to only 24 percent of organizations that do not use FCCR.
However, as its name implies, FCCR has a heavy focus on the needs of the finance function. It also straddles the boundary between analytical data infrastructure (ADI) and operational data infrastructure (ODI)—see the Research Insights “To Become a Data-Centric Organization, Build a Balanced ADI-ODI Perspective” and “Path to Becoming a Hyper-Decisive Enterprise Tracks Through a Balanced ADI-ODI Model.” As such, organizations often treat FCCR as a finance-only domain application, rather than a key source of analytic content for the enterprise, with many data leaders perceiving it as a “finance-only” solution because it focuses on specialized capabilities such as financial consolidation and close management.
FCCR’s position as a subsegment of the enterprise performance management (EPM) software market can overshadow the importance of FCCR. Budgeting, planning, forecasting, and management reporting have a higher profile in most organizations because these capabilities are widely used outside finance. EPM software appears to positively impact success with business intelligence (BI) while FCCR on its own does not, despite its role as a key foundation for EPM especially in organizations with multiple legal entities.
Organizations increasingly prefer to source EPM capabilities from specialist vendors rather than from ERP vendors, or from EPM vendors with a close relationship with ERP vendors. These preferences will create master data management (MDM) challenges because the data model of EPM software sourced from specialist vendors will differ from that of underlying ERP and transactional systems. Also, many organizations may source planning and budgeting and FCCR capabilities from different specialist vendors, increasing the possibility that data governance may overlook FCCR.
Consequently, data leaders must ensure that FCCR is not treated as a “finance-only” capability. FCCR plays a key role in improving access to analytic content and increasing trust in data, both of which are fundamental to achieving higher levels of hyper-decisive maturity. Data leaders must therefore ensure FCCR solutions complement and augment data catalogs and other analytical data infrastructure capabilities and are not locked away in a finance-only data island.
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