Bridging the Gap between ERP Systems and Microsoft Office with Financial Analytic Applications

July 13, 2016
By Melanie May
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Melanie May

36 articles

It’s no secret that many finance users find standard ERP reporting tools difficult to use. Because of the complexity of data structures in systems like SAP and Oracle, these users often find themselves dependent on IT or consulting resources to create reports, or waiting on lengthy downloads of static information from a warehouse to where it’s formatted and analyzed, which is usually in Microsoft Excel.

Is there a way to expedite financial reporting from ERP systems? In its IT Market Clock for Financial Management Applications, 2015 report authored by analyst Nigel Rayner, Gartner defines a class of Financial Analytic Applications as follows:

“Financial analytic applications are pre-built solutions that enable finance users to analyze financial data for various purposes, including monitoring aged debtors or receivables and analyzing budget variances or financial statements.”

These solutions have predefined connectors to data sources like ERP systems, and their architecture masks an ERP system’s complex underlying structures.

Fast Access to Real-time Transactions

What if the interface to a Financial Analytic Application is Excel? A survey of finance practitioners by gtnews, a unit of the Association for Financial Professionals (AFP), found that 73 percent use spreadsheets for more than half of their FP&A analytical work. Despite Excel’s popularity, consultants caution against its use as a minor subsystem with potentially outdated data. But let’s consider the power of Excel as a front end for a Financial Analytic Application that links to real-time ERP data.

With an Excel-based Financial Analytic Application, users no longer export static ERP data from a warehouse to an isolated spreadsheet, but instead view real-time data as it is stored in SAP or Oracle through Excel, a favorite and familiar tool. The features of an Excel-based reporting tool create an environment where finance users don’t need to engage IT staff or consultants for a quick answer to a question, because the tool will refresh data with a mouse click. The tool also empowers them to perform subsequent interpretation of the data they discover.

Self-service reporting for finance users becomes a reality with an Excel-based Financial Analytic Application, yet those users are not creating spreadsheet silos because there is a direct link to the live data in the ERP system. The tool also fully integrates with an ERP system’s existing security profiles and hierarchies.

Advantages Compared with Standard ERP Reporting Tools

As the figure below shows, traditional reporting from ERP systems involves defining and executing reports using standard tools―like Oracle Business Intelligence Enterprise Edition (OBIEE), Oracle Financial Statement Generator (FSG), and Advanced Business Application Programming (ABAP) from SAP―yet the data is typically dumped into Excel for formatting, review, and distribution. This disconnect is fertile ground for inefficiency and inaccuracy, especially when changes are made and data has to be exported once again to Excel.

Figure 1: Traditional reporting cycle

In comparison with the previous figure, the following one shows the reporting model for a Financial Analytic Application that uses Excel to define, execute, review and distribute reports in much less time than the other model. The ability to refresh values in place through special linked formulae and to drill down to a full audit trail eliminates the disconnect between the ERP data and the reporting mechanism.

Figure 2: Excel-based reporting cycle.

An organization’s IT landscape is often characterized by two distinct and separate environments: an ERP system like SAP or the Oracle E-Business Suite and the Microsoft Office product set, including Excel. With an Excel-based Financial Analytical Application, you can bridge the gap between the two, leveraging and expanding both platforms to empower users. These solutions are easily installed and implemented―unlike standard ERP reporting tools―and feature a price point that is appealing to most companies, especially when compared with standard ERP reporting tools.

Which ERP reporting tool is right for you? 

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