Reporting has been and still is the most important part of running a business. Without taking the pulse regularly (or better yet, constantly), how would you know if your business is healthy or sick, thriving or dying.
Here’s the catch, truly useful reports take careful planning and considerable time to compile. A truly useful report cuts down the amount of parameters to wade through, and it highlights the most important and relevant information for the business owners and managers to make not only good decisions, but to make those swiftly — because in decision-making, next to the quality of the decision itself, the timing is the most important aspect, and a lot of people don’t realize this.
And since it has to keep up with the changes both internal and external to the company, it also has to be modified continuously.
Another important aspect of today’s reporting is: Visualization. Far from being just pretty charts, modern reports takes advantage of the fact that our brain has a tremendous capacity to process information when served in a coordinated visual pattern.
So here comes the question, who takes care of the reporting in your company? The answer, as we shall see next, is not as simple as you may think.
Most surprisingly, most companies are not doing nearly enough tracking and checking the pulse of their business processes. Reporting is just an afterthought in which the goal is “just enough info to get by” instead of being recognized as one of the key aspects of the whole business operations.
Despite the increasing popularity of Executive Dashboards, Infographics, Data Warehousing and Business Intelligence tools in general, there are still far too many businesses whose reporting activities are reserved for end of the week rush jobs or those tense accounting department fire-drills where you can feel the heat rising at the beginning of each month.
In Short: Unacceptable. Someone has to be responsible to compile and generate your truly useful reports.
Isn’t That The Company Accountant’s Job?
While accountants should generate useful reports, they are limited to only one aspect of the business, the financials. Truly useful reports encompass the whole business operations, not just the financials.
Even in the realms of financial report, your accountant most likely would not have enough visibility into the business to tell you important information that could help you grow the business.
For example, a report from your accountant would state how much profit the business is generating this quarter, but most likely it will not say which part of the profit came from a high-maintenance customer who takes up twice as much resources to serve. Nor it would tell you that you have a leak in your business process because you are paying a vendor extra for something that isn’t contributing to your business process.
From customer demographics and statistics, to inventory flow and trends, to manufacturing logs and exceptions, to vendor analysis, and more, these are important “pulses” that a truly useful reporting should cover. The more regular and painless it is for you as the business owner / manager to get a hold of these information, the better you would be able to run the business and grow it.
In the ideal setup, financial reports would be one of the inputs into the reporting system. A whole lot of information can be cross-analyzed between departments in your business. By taking time to do this, these reports can yield insights that you never even considered before!
In Short: No. Your business accountant should be one of the sources for the data that went into your truly useful reports.
Is It The Business Owner?
Since the business owner is the one who ultimately make the decision for the company, it makes sense that he or she is the one who consume and utilize these reports the most.
The distinction here is between consuming vs creating the reports.
Business owners should use the reports to monitor, and make decisions, but if they are also the ones responsible for creating them, when will they have the time to read them? And sadly, since they are busy putting out fires (show me a business owner who is not doing this all the time) while trying to keep the sales pipeline filled up, more often than not, reporting takes the back seat and the business loses a lot of potential revenues from the lack of monitoring and decision-making.
In Short: No, the business owner should be the last person responsible for generating the reports. All of their time should be spent consuming and utilizing those reports to make business decisions.
Is It The Employees?
If the business owner delegates the report generation to an employee, then the employee should have enough visibility into the business *and* the knowledge and experience to build the kind of report that is truly useful, which usually requires a lot more than just familiarity with spreadsheets.
So not only does the business have to put a process in place to disseminate the visibility to the responsible employee(s), but also, there has to be an implicit (or explicit) trust that the employee would not abuse the authority by combining what they know about the company with the new information that is accessible due to the new level of visibility.
In Short: Maybe. Unless the company has the budget and the infrastructure to support a team of experienced reporting and data-analysis as staff, reporting is not a good side-job for existing employees due to the experience required and the sensitivity of the information.
Okay, I Give Up!
So really, who should do the reporting? The answer may surprise you: An outsider.
There are service providers whose goal is to do in-depth, automated, reporting for others. Due to the abundance of data both within your company and relevant ones outside (what often referred to as Big Data, sometimes correctly, other times not), these kind of services will become as mainstream in the near future.
One of the benefits of outsourcing reports is that you get a fresh perspective and an impartial view of your company’s data. Why is this important? Typically, a reporting service provider has a lot of experience seeing patterns of data that can be useful when mining for information. Let me explain below.
Business owners usually think that their data set is unique to their business, but this is often not the case. Whether we are talking about soil humidity data gathered via telemetry, or the number of customers who predictably buy a certain product each month, to an experienced data analyst or scientist, those are just numbers that exhibit a certain pattern of distribution.
In fact, these patterns are what makes things interesting. They can be visualized to give business owners a different view to their business. The kind of view that could be very useful to make those important decisions.
Another important benefit in outsourcing reports is the fact that the service provider has not stake in the company. They are motivated to provide the best service possible without having to know the meaning of the data that is analyzed.
In fact, any decipherable sensitive data should be scrubbed before it goes out of the company, and when the reports are generated, those went through an automated mapping process (setup within the company boundaries) that puts back the right context into the generated information.
In Short: The key to setting up a reliable automated reporting system is to find a good reporting service provider who knows how to handle your company data professionally. We don’t yet have household names for this kind of service, but there are companies who are working on that. Including nextCoder.
At nextCoder, we help our clients get a constant and useful, distilled, aggregated information that they can use to make business decisions better, quicker and with a higher degree of confidence. Often times using the data they already have.
As the result, our clients experience a steady improvement in their visibility into their business processes and this turn into the ability to measure the relevant KPI (Key Performance Indicator). As the old adage says: What gets measured, can be improved, is certainly true in this case.