Srinivas Pothireddy, vice president at Apps Associates, told CFO Dive which metrics to analyze and which to ignore for meeting today's digitized demands.
In this Q&A with Jane Thier (@thier_jane), Srinivas answers questions around which KPI’s are worth tracking and how you can leverage Analytics to help evaluate gaps in the financial close cycle, and introduce business process changes through digitalization, to alleviate problems and enable easier access to information.
Financial metrics — tracking them, analyzing them, and knowing which ones to pay attention to in the first place —comprise the backbone of an organization, no matter the industry. Most businesses already have set finance KPI goals, and many use Excel to analyze data, or they use traditional business intelligence (BI) to look at data. Both of these methods can make it fairly difficult to stay competitive today because of the way they lead to data silos.
Organizations must know which metrics to track and measure. Generally agreed-upon "must have" metrics, when it comes to the finance department, include earnings before interest and taxes, liquidity ratio, net cash flow, working capital and vendor expenses.
With BI and other tools that can connect ERP systems to budget data, finance teams can also track more unique KPIs that require in-depth data processing.
CFO Dive spoke with Srinivas Pothireddy, vice president at Apps Associates, about which metrics finance teams should pay special attention to in the year ahead.
This interview has been edited for clarity and brevity.
CFO DIVE: Can you give some examples of lesser-known KPIs? Why are they vital for financial reporting?
SRINIVAS POTHIREDDY : While the most important key metrics can determine the health of an organization and indicate future growth, lesser-known KPIs are vital [in that they let the] finance [team] focus on operational performance of individual departments. Some examples for these KPIs:
As finance becomes increasingly digitized, what can CFOs, other finance executives and their teams do to stay ahead of the curve?
POTHIREDDY : Finance has increasingly become digitized, but [while it] yields successful results, the path towards digitalization is still being explored. Finance teams continue to have a large scope for adopting digital technologies, with the goal to improve existing business models and engage in opportunities for increased revenue. To stay ahead of the curve, CFOs, VPs of Finance and their teams can:
Where should CFOs draw the line between human tasks and automated tasks? Which parts of the reporting process are well-positioned to be digitized, and which should still be done by humans?
POTHIREDDY : Most tax and regulatory reporting, in addition to core business functions, are already automated, or in the process of getting automated. This includes month-end and year-end financial reports, SEC reporting, and Wall Street reporting.
However, there are still several tasks that will continue needing human involvement. Among them:
Read the full article here: - https://www.cfodive.com/news/which-kpis-are-worth-tracking/566183/
Apps Associates is the recognized industry leader for migrating and managing Oracle-to-the-Cloud. With thousands of engagements, Apps Associates brings the knowledge, flexibility and relentless customer-first focus companies rely upon to help them move to the cloud and solve their most strategic and complex business challenges. Acting as an extension of customers’ IT teams, Apps Associates delivers breadth of services and dependability along with unparalleled agility and ROI. Longstanding customers such as Brooks Automation, Hologic and Take Two Interactive turn to Apps Associates as their trusted partner for the management of critical business needs, providing strategic consulting and managed services for Oracle, Amazon Web Services, Salesforce, integration, analytics and hybrid cloud infrastructure. Learn more about us at www.appsassociates.com.