When it comes to cash flow, knowledge is power. You’ve got to be able to pinpoint precisely how much is going out—and how much is coming in—at any given moment. And members of the finance team are expected to call up those numbers in the blink of an eye. After all, according Accenture’s 2014 High Performance Finance Study, 73 percent of CFOs surveyed are responsible for challenging and supporting strategic decision making, while 60 percent are tasked with providing insightful analytics to the company as a whole. That’s why it’s imperative to put a robust visual analytics solution in place.
A visual analytics solution allows you to draw on existing real-time data from your ERP or CRM solution and quickly create and share easy-to-understand data visualizations. With data visualizations, you can immediately spot trends and patterns and glean insights that will assist with forecasting, budgeting, and cash flow.
You could develop a data visualization that plots out the company’s revenue by month. That way, you can easily spot spikes and dips. You’ll quickly see when revenue rose and when it declined, and you can correlate that information with other factors. Did revenue rise following a special promotion? Was there a drop in revenue after an ill-fated product release? One chart tells the story.
Monthly Deferred Revenue
By creating a data visualization for monthly deferred revenue, you get a glimpse of your overall revenue pipeline. With the data clearly laid out in a chart, it’s easy to see whether deferred revenue is increasing or decreasing and use that information in forecasting. If deferred revenue is declining, it indicates a slowdown in sales, which could put a crimp in your organization’s future cash flow.
But if monthly deferred revenue is on the upswing, you can forecast a corresponding increase in available cash.
Revenue by Source
A data visualization that breaks down exactly where your revenue is coming from provides valuable insight at a glance. You can see which revenue streams are bringing in the most money, and which require a little extra attention. Let’s say you offer a SaaS solution. If your subscription revenue is strong but upsell revenue has slowed to a trickle, you can direct your sales reps to spend more time contacting existing customers and extolling the added features and benefits of your solution.
By visualizing all of your revenue by source, you can stay on top of trends and develop a plan to mitigate potential cash flow problems. For instance, if you see that 70 percent of your revenue comes from one account, that’s an indication that it’s time to diversify your revenue stream. Otherwise, if that one account takes its business elsewhere, your company may be facing a world of hurt.
Data Visualization Shows Your Cash Flow
All data tells a story, but rows of numbers and endless spreadsheets can obscure the meaning. With effective data visualization, the cash flow picture becomes clear to everyone.
The right visual analytics solution will allow your finance team—and everyone else in your organization—to interact with real-time data and create their own shareable data visualizations.
Ready to use visual analytics to help forecast more effectively, improve cash flow, and increase profitability?
And don’t miss out on the pre-built interactive dashboards from iCharts, created specifically to support finance department best practices. Our iCharts | Cloud Enterprise customers can access these dashboards as a standalone product or as an integration within NetSuite.