Kyle Maloney
September 20, 2023

Implementing a Financial Data Platform: A Guide for Finance Leaders

In this post, we’ll explore the steps involved in implementing the right financial data platform for your business. 

The era of using traditional spreadsheets and bespoke reporting systems for financial management is coming to a close. Modern finance leaders are turning to financial data platforms to streamline operations, gain real-time insights, and maintain robust financial controls at scale. However, choosing the right platform that meets your unique business needs can be a challenging task. 

In this post, we’ll explore the steps involved in implementing the right financial data platform for your business. 

First, what is a financial data platform? 

A financial data platform is a centralized system that aggregates, processes, and automatically reconciles financial data from various sources within an organization. It's a financial operations hub, purpose built for financial workflows, offering tools and functionalities for data extraction, transformation, reconciliation, and analysis across every source of financial data leveraged by the organization. Rather than relying on in-house bespoke reporting systems, finance teams leverage financial data platforms to self-serve automated reconciliation and accounting, ensuring that all financial information is accurate and up to date in real time.

For more information on financial data platforms, check out our recent post, Understanding Financial Data Platforms: A key to Modern Finance Operations

How to implement a FDP

Step 1: Engage Key Stakeholders

Start by identifying and engaging the relevant stakeholders in the decision-making process. While this includes the finance and operations team who can emphasize the need for financial automation, it is also important to engage representatives from the product or engineering team to understand your data requirements. Additionally, input from customer success and operations teams will provide a holistic view of the requirements, ensuring the platform effectively caters to cross-functional needs.

Step 2: Determine your operational and control requirements

Define the primary motivations behind your need for a financial data platform. Is it:

  • Automating financial operations for efficiency and accuracy?
  • Instituting robust financial controls to monitor and manage financial activities?
  • Establishing a workflow that tightly couples exception management with transactions for accountability?
  • Reducing burden on your engineering and data teams and empowering finance users with tools to self serve?
  • All of the above? 

By highlighting your core operational and control requirements, you can identify the most viable platforms that align seamlessly with these needs.

Step 3: Understand Your Data Sources

Mapping out the origins of your financial data is an important piece of controls. Whether sourced from legacy systems, contemporary ERP software, third-party applications, or internal data stores, ensure your chosen platform not only integrates smoothly but can also uphold the financial controls standards required for each source.

Step 4: Compare vendors

Equipped with a comprehensive understanding of your needs, sources, and desired workflows, embark on a vendor comparison. For larger enterprises, seek vendors proficient in managing complex financial data intricacies, emphasizing financial controls and workflows. Startups, on the other hand, should prioritize flexibility, scalability, and vendors who are adept at navigating startup-specific challenges.

Key considerations for vendor comparisons: 

  • Platform flexibility to handle current and future sources of financial data. Does the platform enable you to easily add new sources of financial data in the future? Does the platform enable your reconciliation and controls workflows to be provider agnostic? 
  • Clear reconciliation and workflow rules to ensure auditability of your controls. Does the platform allow you to configure your reconciliation rules and workflows, or are matching algorithms a black box? Does the platform support auditability and cross-team collaboration?
  • Instant time to value vs. resource-intensive integration cycles. Does the platform enable you to get up and running quickly? Or is there a large up front effort to begin realizing value? 
  • Support, service, and expertise. Does the vendor provide support, expertise, and direct access? Do you have access to the subject matter experts you need to maximize your value of the platform?

Step 5: Calculate the ROI

Before making a final decision, review the potential Return on Investment (ROI) of your choice. Beyond the upfront costs, factor in:

  • The potential risk reductions from implementing tighter financial controls.
  • Time saved in streamlining operational workflows.
  • Costs associated with training, maintaining, and upgrading systems.
  • The opportunity costs of the required engineering and development teams, depending on the chosen vendor. 

By incorporating the expenses associated with your teams' time and comparing against the benefits of improved financial controls and optimized workflows, you'll be in a prime position to make a strategic, data-rich decision.

Step 6: Implement, measure, and iterate

Having laid the groundwork in the preceding steps, now comes the phase of bringing your chosen financial data platform (FDP) to life in your organization. Here’s how you can go about it:

Implementation

  • Pilot Run: Before a full-fledged rollout, conduct a pilot run within a specific department or for a set of processes. This provides a testing ground to identify potential issues, gaps, or areas of improvement.
  • Data Integration: Ensure that all the identified data sources are integrated seamlessly into the FDP. Regularly verify the data's accuracy and completeness during this phase.
  • Training: Organize training sessions for your team members to familiarize them with the platform's functionalities. This ensures a smoother transition and promotes maximum utilization of the platform’s capabilities.

Measurement

  • Performance Metrics: Identify key performance indicators (KPIs) related to the efficiency, accuracy, and agility of financial operations. This could include metrics like data processing time, error rates, user engagement levels, etc.
  • Feedback Collection: Regularly collect feedback from end-users about the platform's usability, efficiency, and any challenges they might be facing.
  • Audit & Compliance: Ensure that the platform adheres to the financial controls and compliance standards set by your organization. Regular audits can help in keeping the system transparent and accountable.

Iteration

  • Data Analysis: Use the data from the measurement phase to analyze how well the FDP is performing against set benchmarks.
  • Continuous Improvement: Based on the insights derived, make necessary adjustments to improve the platform's efficiency, whether it's modifying workflows, updating reconciliation rules, or refining controls.
  • Scalability Checks: As your business grows and evolves, your financial data requirements will too. Ensure that the FDP remains scalable, flexible, and can accommodate newer data sources or more intricate financial workflows.

Conclusion

The journey of implementing a financial data platform doesn't end after the initial setup. The key is in continuous monitoring, measuring, and iterating to ensure it remains aligned with the dynamic needs of your business. As financial landscapes evolve, your FDP should be agile enough to adapt, ensuring that your organization always has its finger on the financial pulse. With diligent implementation, measurement, and iteration, you can unlock the full potential of your chosen platform, making it a cornerstone of your financial operations.

If you’re looking for a financial data platform that automates reconciliation and controls, Proper offers a comprehensive solution for business of all sizes. For more information, reach out for a demo.

Kyle Maloney
September 20, 2023

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