Just a decade or two ago, critical business information such as customer satisfaction, sales performance, employee attrition, and shipping punctuality were considered mere proprietary data. Smart business practice meant keeping as much information confidential in order to stay ahead of your competitors.
Today we have entered a new era. An era of information where we moved past corporate reporting based only on what the government and its agencies require. There is a growing pressure from customers, investors, employees, and government bodies to disclose more information than before. There is a clamor for increased accountability both inside and outside the organization.
So what is Accountability? In a book authored by Bill Birchard and Marc J. Epstein called “Counting what Counts: Turning Corporate Accountability to Competitive Advantage” Accountability is defined as the ability to measure performance quantitatively in terms of financial and non-financial data and then report the results within and outside the organization. The act of one party answering to another in qualitative terms alone is not enough. Accountability requires data.
Enforcing accountability in organizations is very reliant on measurement and reporting. In theory, this responsibility falls on the shoulders of the company´s leaders. However, in practice this responsibility falls mostly on the CFO and the finance departments.
Finance personnel are given tremendous power to enlighten and guide decision-making within the organization as the organization´s partners to success. This same accountability becomes the springboard towards better overall performance.
Here are the top 5 management practices that help enforce accountability in organizations:
- Adoption of Modern and Intelligent Technology
As mentioned earlier, accountability is heavily reliant on measurement and reporting. To be able to enforce accountability, clean, good, and reliable data must be available.
This can happen with the aid of modern technology.
Corporate Performance management software like Performance Canvas by DSPanel is an example of how a system can help turn mere data into a valuable insight that can be used in decision making. CPM tools like Performance Canvas not only automates reporting, budgeting, planning, and consolidation of information, it also streamlines the entire process of the organization to ensure that the data remains relevant. It is just as important that obtaining this information does not take too long otherwise the data becomes outdated.
- Integrated Management Systems
Organizations today work to link several systems within the organization for corporate strategic planning, business unit planning, annual budgeting, performance appraisals, and compensation reviews.
Linking several management systems allow the organization to break down top level measures into smaller measures of division and team performance. This empowers frontline employees to recognize and contribute to the company´s overall success.
- Independent Governance
Directors/leaders/executives must be independent and their performance must be regularly assessed. They must be made accountable for the company’s overall performance.
- Broad-based reporting
To enforce accountability, it is important to develop communication strategies that reflect transparency. It is important for finance managers to gain the trust of shareholders and employees as well as business partners and customers by providing them with real time, up-to-date data and descriptive information in order to foster collaboration in an effort to generate ideas that improve the business.
- Measurement of Non-financial information
Over the years the finance departments have come to realize that the best way to stimulate peak financial performance is not just to highlight financials but to also include broader measures like leading and lagging indicators, financial, social, and operational measures. All these non-financial data are important in order to see a wider picture of how the business is performing.
If you are looking for ways to enforce accountability within your organization, start by ensuring that the finance departments within the company have all the data they need for good measurement and reporting. Check out www.performancecanvas.com to learn more about how to streamline reporting, budgeting, forecasting, and consolidation of data. This unified tool can also help you measure non-financial data alongside financial data. Email [email protected] to see a free demo of this tool or visit www.performancecanvas.com.
DSPanel offers cutting edge technology platform for business analytics, planning, and visualization. DSPanel designs, builds, and operates with the end users in mind. Performance Canvas was created by DSPanel to answer the unarticulated needs of the market not addressed by previous available solutions. With Performance Canvas, information is transformed into valuable business insights for the business executives to utilize in their decision-making process. DSPanel currently has over 2500 organizations deploying their solutions.