ERP companies do not provide rigorous reporting capabilities in their products. Most people know this, but it still comes as a shock to some companies when they have just invested a huge amount of money in the new system to discover that the glossy reports they were shown in the demos were in fact hard coded examples of what could be built given the right software, time and expertise.
The upshot of this situation is that most companies now use a variety of tools to deliver their reports on a home grown basis across the company, with Excel-based systems leading the pack.
The Finance Department are the guardians of the corporate view and tend to focus their energy on delivering systems that reflect the CEO/regulatory reporting perspective.
So, like it or not as an operational manager or subsidiary company, the perception of your performance will be delivered by the finance function to the executive.
However, research shows that many companies fail to provide management with adequate operational reports. Ventana research has confirmed this assertion in a recent report – see our January newsletter for details.
As many of us know, the common remedy for this problem is for operational units to develop their own reporting systems.
You do not have to be a genius here to see the problem as we will quickly arrive at the situation where top management have one view of performance and operational management another.
This is a potential time bomb and no Chief Finance Officer should be happy with this situation.
Let’s be clear, the problem here lies with Finance. They are so focussed on their group and management responsibilities that they often completely forget that it is also their responsibility to deliver a service to line management.
From a technology perspective, Finance have a difficult job, but that is no excuse for ducking it. Technically the issue is that ERP system’s transactions flow through hundreds, possibly thousands of tables, so uncovering the audit trail, which is necessary if you are to provide a full service, is very very difficult.
However this is a solvable problem and I will cover potential ways forward in my next blog.
Ignoring the problem is not a solution.