Based on my recent experience with construction clients, I would say the answer is likely to be no.
Construction companies have invested a lot of money in technology over the past 10 years. These packages come in various guises – enterprise resource planning (ERP), customer relationship management (CRM), supply chain management (SCM) and others to meet particular needs.
All this investment is great but do these products really do what they say on the tin and, just as importantly, can these systems talk to each other? Again, the answer is often no.
Data rich, information poor
One of the challenges facing organisations is how to link the data captured to provide maximum return on investment.
Without these linkages your company becomes ‘data rich’ and ‘information poor’.
So how can you tell if your company is in this situation? Well, for starters do you recognise the following symptoms?
Financial reporting obesity – where a company, perhaps through acquisition or joint venture, has different ERP systems for finance, including a number of charts of accounts, with the result that consolidation is difficult.
Supplier amnesia – where a company may have different systems for capturing procurement information (e.g. suppliers, purchase orders and goods received). This can mean being left with different supplier and commodity codes, which -provide problems in obtaining information relating to supplier performance and maximising supplier discounts.
So what are the key steps you should take if you decide that simply increasing the size of the finance function is not the appropriate approach to addressing this information deficit?
Business intelligence healthcheck – review the management information (e.g. board reports, project reports, supplier performance etc) that is generated by your organisation.
Taking stock of your symptoms – identify the key elements for meeting the management information requirements of your organisation, including data structure; source systems; output formats; frequency and potential data gaps.
Treatment options – take account of the scale and investment in systems by your organisation. Evaluate the costs and benefits associated with the two approaches of dedicating additional resource to the provision of management information or the design and implementation of an Enterprise Reporting Tool.
A second opinion – where the preferred approach is the implementation of an Enterprise Reporting Tool, ensure that you build on the experience of your peers in the sector.
As the sector continues to change at pace, the information requirements of internal and external stakeholders will increase in frequency and complexity – unless you can turn your ‘data silos’ into an ‘integrated information landscape’, your data sources may lead you to an information desert.
Danny McConnell is a partner in consulting for Deloitte