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Finance portals: a view to tomorrow's business strategies. (Shared Services).

While the benefits of operating through a centralized environment have been obvious for some time, new finance portals provide a complete and real-time picture of corporate performance.

Now, perhaps more than ever, businesses around the world are recognizing the importance of operating in a centralized or shared services environemnt. Until now, it was one clear way to provide senior management with access to all of the latest financial figures for items such as revenue growth and expenditures. But, like most things in business, even this is changing, and managers are being faced with new demands for increasingly more detailed financial information.

Today's CFOs need access to all financial key performance indicators (KPIs), and they need it in a timely and informative manner that makes it instantly recognizable. How do you deliver a comprehensive, multifaceted overview of some 20-plus KPIs in the space of one computer screen? One way that many are opting for is to leverage the strengths of their already-established shared services environment with innovative finance portal technology. Finance portals allow users to gain a comprehensive, real-time picture of corporate performance--with just a few mouse clicks.

Shared Services First

The benefits of operating from a shared services environment have been apparent for quite some time. By far the biggest advantage is the ability to process all of a business's financial data through one centralized database. This avoids duplication of services, creates a standard global chart of accounts and helps implement standard processes. It also offers the benefit of centrally controlled procurement, centralized reporting and increased flexibility for training and knowledge sharing.

All of these benefits contribute to lower costs through a reduction in hardware, software and IT resources. Plus, senior managers can gain real-time access to information that allows them the ability to "drill-down" to see as much detail as required.

One of the many companies to adopt the centralized processing environment is Quincy, Mass.-based CitiStreet. The firm is a 50/50 joint venture between Boston-based State Street Corp. and New York-based Citigroup that serves more than 7.5 million participants and administers approximately $180 billion in assets in the U.S. for defined contribution, defined benefit and health and welfare plans of corporate, government, health care, Taft-Hartley and not-for-profit organizations.

"We initially implemented our financial management package in a decentralized manner across our three divisions," explains Bill Madden, assistant vice president of CitiStreet. "A year later, we had everyone up and running on a centralized database for accounts payable and fixed assets. As a result, we were able to reduce the amount of resources required and we're able to reassign some of those resources to more important responsibilities, like analysis."

Another company to benefit from a shared services environment is Air BP, one of the world's largest suppliers of aviation fuels, supplying over 26 million tonnes (around eight billion gallons) of aviation fuels and lubricants to customers around the world.

"The main reason behind our decision to go with a shared services environment was the ability to have all of the data in one central location. We needed to have financial information readily available for the management control team," explains Jarek Gorecki, business information manager for Air BR "Eliminating the need to have multiple servers in different locations also allowed us to centralize support and have just one team. That alone translated into significant cost savings." Gorecki says another result of going with a shared services system is that the company's monthly and quarterly closings have become much faster, decreasing the time required down from one week to a mere day or two.

Yet, while a centralized environment offers many advantages over a decentralized one, it doesn't offer all of the data necessary for today's KPI-hungry CFOs, and it doesn't offer it in a user-friendly, all-in-one overview. An example is Madden's reference above to reallocating resources to analysis--a financial functionality that is gaining greater importance among the business community. Having real-time access to accurate data across the organization is no longer optional--it has become a regular business practice and it's one where Web-based portal technology can help.

According to Meta Group Inc., a research and consulting firm focusing on information technology and business transformation strategies, a portal product "must provide contextually relevant information to an individual in a customizable manner (for administrator and user) that respects the security and privacy of the individual content." The research firm describes a number of primary functions of CFO portals: personalization, classification, security and access control (for users and contributors). A good portal, it says, provides an efficient, centralized, personalized and cost-effective way to access and profit from structured and unstructured data within and external to the enterprise.

Portal Technology

Deloitte and Touche LLP maintains that traditional business offerings do little in the way of "delivering the relevant information to the right decision-maker at the right time." And, as financial management systems continue to evolve, so too, will the sheer amount of financial data available through such systems. This means it will be harder than ever for senior managers to find what they need as quickly as possible in order to make informed business decisions based on accurate and real-time data.

A financial portal, however, can be designed to do just that. These types of products are user-friendly, analytic platforms designed specifically to help senior managers gain insight into corporate KPIs. They deliver real-time access to critical business data and provide financial teams with the analysis capabilities needed to apply relevancy and perspective to large quantities of corporate data.

Financial portals are typically designed with a simple and intuitive self-service browser interface that allows the user to gather information from disparate data sources ranging from different Web addresses, back-office applications, folders, documents and even emails. They provide a single point of access to integrated information culled from a variety of sources and, by so doing, they ensure more accurate, better-informed decision-making.

Another benefit of financial portals is their ability to provide focused and relevant data to each user, based on his or her respective roles and responsibilities within the organization. In essence, portals can be customized to provide only those KPIs of interest to that particular user, while offering a host of other information to another user. And, they can be implemented with very little capital investment because all of the data is already in the system. Financial portals merely provide a means to extract that data and present it in a user-friendly interface.

Because many of today's enterprises have shifted from the past priority of increasing revenue or market share to one of focusing on ways to increase cash flow and financial net income (among other things), there is a critical need for technical solutions that can enable executives and financial managers to make informed strategy decisions. This shift in focus has created a need for new applications that allow CFOs to track the results of their actions and to implement any mid-course corrections required.

Armed to Help

Some of the new portal products currently available on the market are designed to make the senior manager's life as easy as possible. Aside from being able to incorporate customizable data streams--everything from stock tickers to warehouse reports--many products feature built-in alarm systems to "alert" users of particular outcomes. So, for example, if a CFO wanted to track new product returns as one critical KPI, he or she could configure the portal to automatically send an email alert, say, if the number rose above 100. And, in the event that this happens, the manager has the ability to not only drill down into the data to discover why it happened, but the ability to make a sound business decision based on real-time data and to implement an immediate and corrective measure.

Managers at all levels have a tough time measuring the enterprise's real-time performance--either in its totality or as individual parts, such as line of business or reporting segment. A portal product is designed to find real-time answers to those financial questions and to meet the increasing new demands being placed on financial analysis, budgeting, consolidation, forecasting, planning and reporting functions.

In addition to boosting organizational capabilities, financial portal products also allow for collaboration management. This can be done across departments, regions or across the entire company on a global basis. Users can track and compare business results or other critical information data. They can collaborate on business products and facilitate immediate, proactive action whenever issues arise. Better yet, portal products can be used to improve a corporation's overall efficiency and data reporting consistency.

Business is at a stage where immediacy is key. Executives need the ability to move on a dime. By empowering their senior management with the means to monitor, evaluate and, if need be, react, today's businesses can move quickly and efficiently. This can be done by capitalizing on the strength of Web-based financial portal technology.

Mark Wolfendale is Chief Executive Officer (Americas) for SunSystems (, one of the few financial software companies delivering Web-based portal products. He can be reached at
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Title Annotation:shared services and finance portal benefit chief financial officers by providing needed information efficiently
Author:Wolfendale, Mark
Publication:Financial Executive
Date:Jan 1, 2003
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