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Your finance team is undoubtedly comfortable working in a world of concrete metrics — from revenue and expenses to cash burn and profitability. But in an increasingly competitive landscape, modern finance teams are also tracking intangible key performance indicators (KPIs).
A recent study of agile finance leaders by the American Institute of CPAs (AICPA) and Oracle revealed that they're more likely to track nonfinancial KPIs, including talent analytics, competitive intelligence and brand reputation. The report, Agile Finance Revealed: The New Operating Model for Modern Finance, surveyed nearly 500 senior finance professionals at organizations with more than $200 million in revenue.
Agile finance leaders described a high-performing group of respondents focused on business transformation. The report contends that modern finance teams who include these nonfinancial KPIs in their own metrics can produce better, more forward-looking insights for their organization.
Cloud-based technology solutions can help finance leaders monitor, consolidate and share these various intangibles across the organization. "The data generated tends to belong to the owner of the process," according to the AICPA/Oracle report. "Finance has a potential role as a broker of information who ensures that salient information is validated and made available to decision makers.
Your organization should identify the indicators that best represent your business model and goals, which will be different depending on your organization and industry. That said, agile finance leaders in the study overwhelmingly tracked nonfinancial metrics within five broad areas they consider to be top drivers of business.
Here are some of the intangible KPIs they monitor — and why you should, too:
Financial KPIs are no longer enough to provide finance teams with a full picture of their performance. Fortunately, cloud-based solutions make it easy to gather this information and create a single source of KPI data that finance – and the rest of the organization – can trust.
By incorporating intangible, nonfinancial KPIs into your analysis and forecasting, you'll gain deeper insight into your business, its challenges and its real potential.
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