4 Tips for Successfully Automating your Financial Consolidations Processes

Consolidation is one of the most important and often complex Corporate Performance Management (CPM) process. It is also provides significant opportunity to save time through automation. A key to maximizing time savings is proper planning in setting up the consolidation rules that drive the consolidation. In general the more you ask the system to do, the more complicated this setup process becomes so don’t over-design the process just because the software can handle complex consolidation.  It’s essential to keep the user and business needs at the forefront and have these drive the design of this process.

4 Key Success Factors to Optimizing Consolidation

  • Detailed understanding of your process. Map out the process before you begin and review with your colleagues to be ensure nothing ‘slips through the cracks”. To avoid ‘surprises’ it is a good practice to involve people who participate throughout the process and not just the managers. This is where you can typically discover nuances in the process that when automated can create time savings at all levels of the consolidation not just at the top.
  • Deep knowledge of consolidation software. If you are unsure about some of the functionality or if a capability exists to address a specific requirement take the time to ask your vendor or implementation consultant, odds are if you are using more mature consolidation software the functionality exists to meet your needs. If you are new to consolidation software it is recommended to schedule checkpoints with your vendor to ensure you are taking full advantage of the product to optimize your process, a half hour call with a consultant can reveal tips that save hours each month. 
  • Expected benefits of automation. As with undertaking any project, you should have a good understanding of what you expect to gain out of the automation: how many hours of labor you save every month, reduction in errors, improved analysis. There are many benefits and understanding and quantifying the expected benefits helps you determine the ROI of the effort you put into it.
  • The ‘will’ to get it done. Even with the best planning expectation setting you will hit the inevitable ‘bump in the road’. Perseverance and keeping in mind the benefits you will achieve will keep you focused on driving the project home. As in any project, expecting a flawless execution is not realistic.  It is hitting bumps that determines your success or failure but how you react to those bumps.

Don’t reinvent the wheel

It is easier to create and maintain automation if you can take advantage of system configuration defaults when possible. Overriding these defaults can add some complexity but also allows you to address specific requirements you may have.  Finding the right balance between simplicity and complexity is something that you should collaborate on with your consultant keeping in mind that:  

  • Larger organizations typically require more automation to reduce the amount of manual effort involve in a more complex and distributed organization.
  • Smaller organizations typically require less automation, giving them more flexibility to take advantage of the preset defaults of the system
  • There are plenty of exceptions to the two assumptions above
  • Workflow functionality and process control are key to managing more complex consolidations. If your organization is either large or complex you will need these capabilities in your consolidation software.

What are your thoughts? What benefits have you seen from automating your consolidation process?


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