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By Mark Richards ( and Steve Shaffer - Practical Finance - Blog posts from Finance for Finance


In our first blog post, we split our response to the changing Finance landscape into three areas: Culture, Team and Technology. We discussed how cloud technology can be a great enabler to expand the contribution of Finance within your company.


No doubt, access to timely and insightful finance information that is correlated to operational drivers is critical to strengthening your market position.  The path to delivering this level of information begins with how your team ‘thinks’ about the adoption, deployment and utilization of technology (Cloud, On-Premise or hybrid model).  There is no shortage of data available; it’s your teams’ job to know what data is relevant to manage the business and will get the most out of our technology investments.


Robert Kaplan’s book “Relevance Lost” details how management accounting lost its relevance.  Written in 1987, the message of relevance lost has only picked up steam with the additional complexity of accounting following each shock to financial data integrity (Enron, Dot com bubble, banking crisis, etc.).  This complexity has our team dedicate more time to managing data instead of delivering information – as we manage larger chart of accounts or sub ledgers, SOX/compliance reporting, and tying together disparate systems, etc.   


Following the theme from our first post of “What” (the issue) and “So What” (our action), here are starter ideas on how to help look at data for business insight:


  • Network with the business.  Get out and learn the business by meeting with sales team (why clients buy), marketing (what need are we solving), operations (how we deliver) and different staff areas.  This is the best way to build a good perspective of your business and discover what’s relevant to each group for success, information to succeed and when they need that information.
  • Walk the economic transaction.   Pilots have a great expression “just look out the window” as a great way to confirm where they are despite the myriad of information in front of them.  Mapping out the economics of the major activities in your business allows you to see the steps and end objective.  You can also identify potential methods to deliver information sought.
  • Map in the operational data into the transaction. As the financials are the result of operational actions, expand your transaction map with the operational data like quantity, timing, productivity, cost, etc.  The result is you can see both what information is needed for decision and when data is available for explaining your financial outcome.
  • Think of the dimensions of data.  This is when the fun begins and where Finance plays a leading role to set your company apart.  The ability to add data and examine it for different purposes (product profitability, operational efficiency, client profitability, etc.) leads to create insightful information. 


Two examples of data dimensions:

  • Steve mapped financial data to delivery information to create a view of route profitability that allowed a bakery management team to see their business in an entirely new dimension and make adjustments to how the day-to-day business operated to enhance profitability. 
  • Mark created a branch ranking tool by bringing together used sales, salaries, number of transactions, and profitability to evenly compare 400+ branches and then showed the key driver(s) to move lower performing branches up level (e.g. C branch to B branch, D branch to C branch, etc.).


In both cases, we worked with operations what measures they needed to manage the business and created views of profitability.  By walking through the economics of the transaction, we could see what operational information would give a fair representation of profitability by route or branch.  Most importantly, the information was actionable because it highlighted areas to eliminate or replicate.


These four steps helps us see and react to the business more like operators which makes the financial counsel we deliver more relevant and valuable. These starter steps will help your team look at the data with an equal eye to compliance and business insight (e.g. different dimensions of data) which is critical to get the most out of the staff and technology.




Mark and Steve


Related Blog Posts:

The Pragmatic CFO: How to Respond to Our Changing Landscape – Role of Technology

The Pragmatic CFO: How to Respond to Our Changing Landscape  – Culture


Mark short Bio:

Mark’s background includes VP and CFO for both large global and start-up firms. His finance roles have taken him to 120 cities in 12 countries which have provided a firsthand view of finance's role from initial sale until the cash is collected.  Mark became part of the SAP family through the acquisition of Jobs2Web by SuccessFactors.


Mark works in SAP Financials OnDemand to bring a finance perspective to work with our customers, sales, channel partners, and development team.


Mark is on the Advisory Board of (on-line finance community with 600,000+ members). He has been a local chair/board member of two U.S. financial professional networking groups, during which he created 'CFO Versus Controller – Comparison of Duties' to help companies decide what they needed when hiring a senior finance leader.



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