Re-engineering balance sheet for optimized financial management
Insightful design and thorough analytics re-engineer balance sheets for optimized financial management. This is how fintech drives better decisions.
Big Picture
Digital transformation enhances financial management by working through even the simplest of problems that add up to a whole lot when ignored. This is the transformation story of a Fortune 500 company that faced multiple issues in financial reporting and management.
Fractal identified the key problem areas affecting decision-making by reviewing the company’s data collection, reporting, and reconciliation processes.
Key Problem Areas
- Non-availability of financial statements at the right time,
- Difficulty in understanding the quality of accounts due to high manual efforts to refresh data feeds,
- Missing key attributes of financial data, including relevance, comparability, accuracy, and completeness,
- Inherent limitations of personal biases due to manually made financial statements.
Collectively, these problems accounted for latent decision-making and no value addition. The objective, therefore, was to observe, certify, and make judgements based on data-driven insights. This would lead to greater visibility behind what is driving the health of accounts.
Solution
Fractal was quick to identify the opportunity to incorporate a mix of design, domain, and analytics to create a unique, dynamic solution for the organization.
Key Differentiators
- Minimal, relevant design – to redesign financial statements keeping in mind different user journeys and experiences,
- Strong financial domain expertise – to deliver logics and calculations to drive accurate, reliable, and ideal financial statements,
- Advanced analytics – to deliver insights that were typically beyond those of traditional business intelligence. Summary and detailed views (persona based) were created with ~100 KPIs across liquidity, solvency, efficiency, and valuation being delivered through high-performance dashboards.
Fractal’s re-engineering of the company’s financial management and reporting led to three key transformations:
- Automated data flow from multiple data systems to generate insights to drive actions,
- Capability to deep dive from balance sheet line items to general ledger and sub-ledger account balances and dissect the quality of accounts,
- More efficient and effective quality of accounts every period to capture more meaningful details.
The Change
- Optimal process – Increased visibility into the R2R process was achieved by delivering real-time insights over areas of high risk and potential bottlenecks. Financial trails were now available to know what was driving account balances and historical trends.
- Increased productivity and value addition – Reduced operations time and increased employee satisfaction was noted amongst finance teams as they had more time to focus on value-adding initiatives and analysis.
- Increased profitability – A result of delivering a vital, in depth understanding of financial statements to aid in re-visiting and re-strategizing actions.
- Accountable decision-making – Achieved through automated data consolidation and translation promoting data comparability across multiple business units/segments.
This is one of the many ways in which AI, design, and engineering assure the financial well-being of big corporations. Especially giant organizations which are susceptible to sub-optimal data consolidation that results in lost business insights. There is so much to explore in the realm of digital transformation in finance, and Fractal looks forward to leading the change.