The numbers generated by financial software tell a powerful story about your company, industry, products, and future. Company stakeholders can understand critical messages with the help of powerful stories built with data from your ERP.
How can you turn unfulfilled orders due to supply chain disruptions into an epic tale like your favorite novel?
You can use financial software to tell numbers-based stories successfully if you follow these strategies:
1. Financial literacy: Knowing what your ERP system’s reports tell you about your business based on the numbers.
2. Different business storytelling techniques: You can craft a business story in various ways. For example, visual storytellers use film (movies), while some storytellers use written narratives (novels). It’s essential to consider your storytelling vehicle carefully, whether it’s a report, graph, or narrative.
3. The correct numbers: They say that knowing what a balance statement means and interpreting it correctly is 90% of the battle, but if you’re using inaccurate or outdated information, you’re telling the wrong story.
Finance and accounting professionals are well versed in finances, as well as most managers. Financial literacy involves understanding what information you can obtain from each of the major financial reports: the balance sheet, the income statement, the sales report, and the inventory and warehouse report.
For example, let’s consider the job of a personnel manager in a manufacturing company. While personnel managers may not know all the intricacies of manufacturing products, they can see that a dramatic increase in sales across all channels may require additional staff if they are financially literate. In this case, the numbers demonstrate that sales are growing (the story’s hero), and the company needs to prevent future staffing challenges (the story’s villain) by proactively addressing them now. A personnel manager can read and interpret financial data by understanding the story inherent in them and propose a course of action based upon these findings to benefit the organization.
Next, you need to choose your medium for telling your story. A writer uses words to tell their story, a painter uses paint, and a filmmaker uses video. You must tell your data-based story using an appropriate business medium.
Some suggestions include:
- Written reports, such as summaries or memos
- Presentations at meetings, such as slide shows
- Charts and graphs that visualize data
Charts, graphs, and other data visualizations are the best way to tell engaging, compelling, and easily understood numbers-based stories in the business environment. Many people use these methods as their primary means of storytelling. To help make their points understandable to the average viewer, they use them as part of a written report or presentation.
Continuing our manufacturing company example, the personnel manager checks the overall balance sheet and observes that sales are up across all channels: retail stores, e-commerce, and distribution partners. He uses a pie chart to display the percentage of orders from each channel. After that, he shows year-to-year sales growth in a line graph. Line graphs make it easy to see the steep rise in sales for the current year, and with the company’s sales so brisk, the company will likely need more employees to handle manufacturing increases and order fulfillment.
Last but not least, you must be sure the data you use is accurate. That’s where financial software, or enterprise resource planning (ERP), comes into play.
You can use insights and data provided by cloud-based ERP systems to develop powerful strategies. Data that is more recent will enhance your financial storytelling since it is a story that will have an immediate impact. Although older data can tell historical stories, it must be updated to describe current conditions accurately.
You need to investigate when your ERP system’s numbers-based story doesn’t look right, or your colleagues say it’s inaccurate.
Does the system capture the correct data? You may need to investigate further to understand why the information is inaccurate. Could anything have changed in the system that would affect data collection accuracy?
Does it update it frequently? Cloud systems update more frequently than older or on-premises systems. If you want your business to gain a competitive advantage, you may want to consider switching to cloud-based ERP.
Does the “story” contain any gaps? It may be time to update inventory management software if, for example, your ERP captures data from every department but the warehouse, which still uses spreadsheets and manual scratch counts.
When interpreting financial data, the right business intelligence can make all the difference. It is imperative to be accurate.
Who Is Your Audience?
In crafting a story, every good storyteller considers their audience. Stories tailored for marketing professionals may tell quite a different story than those tailored for CEOs. You should tailor the story to the audience and the objectives they hope to achieve from it.
CEOs and other executives want to know what’s happening to their bottom line, so storytellers need to emphasize the big picture, provide a few insights, and provide action steps quickly. Giving CEOs all the details is usually unnecessary, as they don’t have time, patience, or need to hear them. Instead, they prefer a high-level overview.
In contrast, middle managers may prefer details since they often rely on them to do their jobs well. The report should address middle managers’ concerns and provide them with information that will allow them to make informed decisions.
You should consider the implications of financial software on your ability to generate accurate, timely information as you review this information and consider the many ways financial storytelling can improve your ability to convey important information.
You won’t be able to tell a good financial story if your software isn’t up to date or if you don’t have the right tools. Now is an excellent time to upgrade your business software suite, switch from on-premises to cloud, or update your ERP. Our experts can give you the right tools to tell your financial story. Contact us today