Deltek Insight 2012: Best Practices for Data Discovery and Analysis for Finance

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Your organization generates large, complex amounts of data. And, your financial leaders need to quickly make sense of this mountain of data in order to keep the organization on track financially and strategically. This session will show how creating analytical dashboards with Costpoint Analytics can improve fiscal transparency and accountability in the organization. Beginner Level.

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Deltek Insight 2012: Best Practices for Data Discovery and Analysis for Finance

  1. 1. Best Practices for DataDiscovery and Analysis forFinanceDavid Murphy, Manager, Watkins Government Services LLCSusan Miller, Managing Member, Watkins Government Services LLCGC-261
  2. 2. AgendaIntroductionBackgroundBest Practices in Data DiscoveryData Visualization Best PracticesRoadmap to Value CreationQ&A2 ©2012 Deltek, Inc. All Rights Reserved
  3. 3. BackgroundWhy is data discovery important?  Increasingly competitive marketplace  Changing role of finance / accounting3 ©2012 Deltek, Inc. All Rights Reserved
  4. 4. Background4 ©2012 Deltek, Inc. All Rights Reserved
  5. 5. BackgroundWhat is the key outcome of implementing a datadiscovery platform?  Capture Business Value by improving our ability to obtain the right information from data to affect key business decisions that result in  Improved management processes –or–  Improved operational processes  Thus, Data Discovery is closely associated with Enterprise Performance Management5 ©2012 Deltek, Inc. All Rights Reserved
  6. 6. How Data Discovery Can Assist in Capturing Business Value Strategic - Gain better insight into key value drivers - Improve decision making Tactical / Operational - Identify outliers that can skew results - Reduce reliance on spreadsheet development - Increase utility of budgeting and forecasting - Extend your analytics6 ©2012 Deltek, Inc. All Rights Reserved
  7. 7. Gain Better Insight into Key Value DriversWhat it means:  Value drivers are business variables that:  Have a substantial impact on business value  Are controllable  Examples include: Administrative overhead, product costs, etc.  Data discovery tools can make it easier to obtain solid, objective information about performance related to key value driversBest Practices:  Identify value drivers as part of strategic planning process and align with strategic goals  Prioritize value drivers  Develop KPIs to track and manage top drivers  Allow for drill-down capability on KPIs7 ©2012 Deltek, Inc. All Rights Reserved
  8. 8. Gain Better Insight into Key Value Drivers8 ©2012 Deltek, Inc. All Rights Reserved
  9. 9. Gain Better Insight into Key Value Drivers9 ©2012 Deltek, Inc. All Rights Reserved
  10. 10. Gain Better Insight into Key Value Drivers PY PY CY CY10 ©2012 Deltek, Inc. All Rights Reserved
  11. 11. Improve Decision MakingWhat it means:  Makes objective, accurate information available for business decision making  Enables analysts, managers, and executives to discover “how” and “why” by allowing users to perform:  Time series analysis  Root cause analysis  Segment analysis  Scenario analysisBest Practices:  Maintain data control – single version of the truth  Plan and build dashboards and analytical tools to answer specific business questions  Integrate results into business decision making process11 ©2012 Deltek, Inc. All Rights Reserved
  12. 12. Improve Decision Making12 ©2012 Deltek, Inc. All Rights Reserved
  13. 13. Improve Decision Making13 ©2012 Deltek, Inc. All Rights Reserved
  14. 14. Identify OutliersWhat it means:  Averages can be misleading if they include outliers…this can lead to poor decisions  Outliers can be anomalies or an indicator of serious problems, such as low-probability, high-impact risk eventsBest Practices:  Use histograms to visualize univariate outliers  Scatter charts may be used to show bivariate outliers  Employ advanced statistical analysis techniques where appropriate  All outliers should be investigated14 ©2012 Deltek, Inc. All Rights Reserved
  15. 15. Identify Outliers15 ©2012 Deltek, Inc. All Rights Reserved
  16. 16. Reduce Reliance on SpreadsheetsWhat it means:  Finance / accounting fields are (in)famous for use of spreadsheets  Weekly / monthly / quarterly analyses and reconciliations can often be automatedBest Practices:  Inventory and prioritize recurring analytics and reconciliations  Incorporate into dashboard requirements  Develop automated solutions that can be shared / viewed in a single repository16 ©2012 Deltek, Inc. All Rights Reserved
  17. 17. Reduce Reliance on Spreadsheets 1. Determine 2. Identify 3. Develop 4. Execute analytical data query(ies) query(ies) requirement source(s) 9. Email 5. Import spreadshe data to et to share Excel Spreadsheet-based financial analysis process 8. View 6. and Transform analyze and format data data 7. Create or modify objects17 ©2012 Deltek, Inc. All Rights Reserved
  18. 18. Reduce Reliance on Spreadsheets 1. Determine 2. Identify 4. View and 3. Develop analytical data analyze data query(ies) requirement source(s) Dashboard-based financial analysis process18 ©2012 Deltek, Inc. All Rights Reserved
  19. 19. Increase Utility of Budgeting and ForecastingWhat it means:  Budgets and forecasts are most useful when compared to actual resultsBest practices:  Develop and implement a standardized approach to budgeting  Prepare budgets and forecasts at control level  Load budgets / forecasts into data discovery application to analyze actual results vs. budget / forecast19 ©2012 Deltek, Inc. All Rights Reserved
  20. 20. Increase Utility of Budgeting and Forecasting Spreadsheet for loading data Detail dashboard compares monthly or YTD amounts to budget Summary dashboard compares performance to budget20 ©2012 Deltek, Inc. All Rights Reserved
  21. 21. Extend Your AnalyticsWhat it means:  Data discovery tools give you the flexibility to modify and expand your analytics to answer business questions as they arise  Ability to bring in data from multiple data sources leads to new ideas for value-added discoveryBest Practices:  Understand the full range of capabilities of your data discovery solution  Create a plan and approach new analyses in a methodical fashion  Assemble a team that understands the data and how to leverage it with your data discovery tool21 ©2012 Deltek, Inc. All Rights Reserved
  22. 22. Extend Your Analytics22 ©2012 Deltek, Inc. All Rights Reserved
  23. 23. Extend Your Analytics23 ©2012 Deltek, Inc. All Rights Reserved
  24. 24. Data Visualization Best Practices“Visualization, well done, harnesses the perceptualcapabilities of humans to provide visual insight into data… (itis) fundamentally about data reduction… Finding a view orprojection of the data that reduces complexity while capturingimportant information.“A successful visualization is one that emphasizes theinformation of interest and presents it at a resolution sufficientto perform the task.” Source: Information Visualization in Data Mining and KnowledgeDiscovery, 2002, Usama Fayyed, Georges Grinstein, and Andreas Wierse24 ©2012 Deltek, Inc. All Rights Reserved
  25. 25. Data Visualization Best PracticesEnsure that the visualizations add to the effective interpretation andexplanation of the underlying data – can you understand thecommunicated information without undue strain?Ensure the visualizations enable the effective detection of trends that canbe easily connected to real world events to help explain relationships andinterrelationshipsColor is critical: Use it appropriately and minimally to maximize its impactEnsure the visualization chosen helps position the report or dashboard asa piece of consumable communication – it must convey a clear, relevantidea/messageSource: http://smartdatacollective.com/yellowfin/37366/data-visualization-best-practices-business-intelligence25 ©2012 Deltek, Inc. All Rights Reserved
  26. 26. Data Visualization Best Practices Data visualization – done poorly!26 ©2012 Deltek, Inc. All Rights Reserved
  27. 27. Data visualization – done well!27 ©2012 Deltek, Inc. All Rights Reserved
  28. 28. Data Discovery: Roadmap to Value Creation (7) Integrate into (1) Champion (6) Connect to Decision Making the Cause Data Sources Process (2) Assemble Performance (5) Create Management Dashboards Team (3) Develop Key (4) Establish Business Goals Indicators28 ©2012 Deltek, Inc. All Rights Reserved
  29. 29. Call to Action Watkins Government Services LLC 6720-B Rockledge Drive Bethesda, MD 20817-1884 301.654.7555 www.watkinsgov.com29 ©2012 Deltek, Inc. All Rights Reserved
  30. 30. Thank You!

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