This December, one of the most anticipated reboots of a blockbuster movie is set to be released. That original movie? Top Gun, with Tom Cruise. In the movie he is the one of the Navy’s top aviators, and a bit of a…Maverick. One of the great lines in movie history comes from the original though. The line? “I have a need, a need for speed.” In the finance world, truer words have never been more spoken.

In 2014, a CFO.com survey showed that 75% of organizations reported that ‘record to report’ process as one of two top strategic goals for financial improvements over the next 18 months. As recent as 2017, it was still taking organizations more than eight days to complete closing each quarter, with the time actually increasing due to an ever-growing environment of business complexity. And that’s just to close the books. Add on additional days to distribute the resulting Financial Statements, and the time for stakeholders to understand the meaning within the numbers, and you’re talking dog years. All kidding aside, here we are in 2020, and not much has changed. The fact of the matter is that organizational inertia is woven into the fabric of many businesses, thus becoming a roadblock to meaningful change. The need for speed has turned into watching paint dry.

If you think it seems like the C-Suite needs information literally on demand you’re not too far off. To meet this evolving need, CFOs, Controllers, Finance Directors and FP&A analysts are constantly challenged to evaluate the Financial Close and distribution process as well as looking for financial reporting software and tools and ways in which to consistently squeeze every last drop of inefficiency out of the close cycle. Thus, two questions coexist in this environment.  First, why close as quickly as possible? Second, what are the levers to pull or to facilitate an ever-shrinking close calendar?

Let’s examine the first question. Why close the books at lightning speed? What is the marginal value of one extra day trimmed from the close calendar?

Understanding the underlying reason for a fast close is the first step to change. Information availability in a nano-second is our norm. We can search the internet with virtually any obscure question and receive answers in milliseconds, yet many organizations accept that a foundational question such as ‘how are we doing’ takes weeks to answer, and even longer to disseminate if not in the hands of the right decision makers.

It’s not a stretch to say that financial data seems to roll in at a glacial pace compared to other digitized information.  This ‘norm’ should not be accepted. Information is ‘speed to value’. That value = faster decision making in a world that changes by the hour. When you factor in lower costs (such as accounting headcount, audit and compliance), as well as freeing up Finance and Accounting Professionals’ time, focus, and their collective intellect to analyze and explore deeper questions and answers, you are left with clear cut examples that support the value proposition.

A recent Deloitte survey of 600 global finance leaders found that companies spend almost 50% of their time creating and updating financial reports, and just a small fraction of that time exploring insights within the data.

This insight is beyond crucial to your organization. In addition, information inflexibility can also be another drain on organizational resources. This means, the more heterogeneous the accounting environment, the more complex the consolidation. Inflexible standard reporting can mean that information consumption and usage suffers, and in many organizations, financial reporting is ignored and thus actionable information is often missed. Information speed is a massive leveraging force.

One additional day trimmed from the close and distribution of results is one additional day of crucially actionable information in the hands of the organization. The value from faster decisions is exponentially beyond the effort to trim the close cycle speed.

This is a strategic view of the value proposition to a faster close. In part II, we will look at the road map that can get us to this optimized state, as well as how the organization can get there without anxiety and angst within the Accounting and Finance Departments.