Key performance indicators must be shared

Finance directors are at risk of missing business opportunities their boards expect them to raise and exploit because they are failing to properly analyse the data they gather or share it throughout the organisation, research carried out by Financial Director in association with Oracle has found.

According to the research, key performance indicators (KPIs) used to monitor and manage decision making are not being shared with the right people, while businesses may not be measuring their performance appropriately because they have not agreed to a single set of metrics that everyone in the organisation understands.

Less than one-third of respondents to the survey reported that every person in their business has visibility of these KPIs, while the overwhelming majority said that only senior managers or executives and board members see them. Perhaps most worryingly, most believe that the finance function is largely reporting just financial metrics to the business, and ignoring non-financial metrics.

Presenting the results of the survey at Financial Director’s inaugural Technology Forum in November, Mark Wilkinson, vice president of UK applications at Oracle, said that sharing data - financial and non-financial metrics to interpret that information - is crucial if organisations want to ensure that they are well governed and that management can develop whatever business opportunities it can find within the reporting process.

Wilkinson said the key goal for organisations is “management excellence”, which is reliant on the organisation’s processes and information being “smart, agile and aligned”.

Management excellence “is dependent on good-quality data being sent to the right people in the organisation, who are then able to drill down into the information and act upon it to achieve a competitive advantage”, Wilkinson told delegates. All organisations have access to the same kind of data. But it is how that data is used that distinguishes one organisation from another and gives it proper insight. “To get the best results, all the key company data has to be aligned so that everyone in the organisation has access to the same information and understands how that data should be used. This means it has to be rationalised, integrated and shared,” he added.