A report is a tool used for data communication. It was first used in financial services and is now found in all business services. Marketing, logistics, administration and financial management, human resources, accounting, etc. All have adopted this tool, no matter how frequently (monthly, weekly...). Concretely, what is a report?And what are the rules to follow in order to succeed in reporting?To answer these questions, we will address:
- What is a business report? (definition and issues)
- How do I report? (construction and example)
What is a business report?
Definition of a report
As mentioned above, a report is a tool used to communicate with data. Data are all around us today. A simple customer record in a local ready-to-wear shop can have an impact on the future of this small shop. The zip code number where the customers come from, the type of purchases they made (children’s clothing, women’s clothing…), their age, the date of their purchases, etc. These data determine the demographic segmentation, the frequency of these purchases (sales, off-sales, distribution period of a catalogue, etc.), the sex of the customer, etc... All of this contributes to the design of a database. These same data can be used in what is called a business report. On a large scale they are a real gold mine!
A business report is therefore a tool that centralizes the essential data to the understanding of a professional environment. For example, a chief financial officer (CFO) will probably have a dashboard with very specific indicators: the main sources of revenue, salary costs, operating costs or purchase expenses.
Each department has its specific features and business reports specific to its activity. And more generally, a company’s report includes the company’s health-related indicators.
The challenges of reporting
Business report is a crucial tool for understanding the market in which a company operates. Taking this look at the past and present contributes to the construction of a forward-looking report. You are probably wondering what forward-looking report or prospective report is! It is -like a forecast- a rational approach that consists of developing scenarios (possible or impossible) from the collected data. By taking a state of play of the situation, by studying the major trends, by observing the emerging phenomena, it is therefore possible to conclude on a potential future. A CFO, a Human Resources Director and also a Marketing and Communication Manager need this foresight to guarantee future results (whether positive or negative). However, the data needed to compile these reports must be collected and processed continuously. Prospective report is iterative and is based on adjustments and corrections. For example, the data presented in an Excel spreadsheet from six months ago may offer a different view than those collected a week ago. This difference must be taken into consideration!The stakes are then economic. In addition, a business report makes it possible to measure yourself against the competition, to follow the life cycle of a product, to anticipate potential crises in a sector, to value the actions of your teams, to adjust the price of a product or to optimize and prepare the delivery of orders…
This constant search for data is a major challenge for companies of all sizes. It is a structural issue. It is imperative to set up a data collection and processing system. For a long time, this branch of IT was the prerogative of large groups, but today all companies and associations can seize it.
However, there are certain rules to follow in order to perfect the use of data. First of all, identify the data that are the most significant for your business; quality over quantity ! Secondly, your data must be as clean and standardized as possible. It must be clear and easily interpreted by a data visualization solution such as Powerslide.
When you have millions of rows in an Excel spreadsheet, it becomes a time-consuming task. Data scientists would spend 80% of their time making data usable.
Sample dataset for commercial reporting
Thirdly, anticipation is essential in data work. It is therefore imperative to ask ourselves some questions!
- What data and how to collect it?
- How will my data be updated?
- What does my reporting represent
- Who is my reporting for?
- What are my KPIs (key performance indicator)?
It’s an objective look at the company. Some harmful cognitive biases are swept away thanks to data. The egocentric bias, which consists in judging oneself in a better light, can hardly be asserted in the face of data. Another example is mental anchoring. This bias is the one that leads an individual to be fooled by the first impression left by a phenomenon. Data confronts us with reality, which repels this cognitive bias. That being said, it reinforces certain biases such as hypothesis confirmation bias. The latter leads to prefer elements that confirm a hypothesis than those that refute it. When faced with data, we must remain vigilant and pragmatic.
According to a study conducted by the Association of Financial Directors and Management Control (DFCG) on the priorities of Financial Directors, 73% of them consider it a priority to develop their critical thinking skills in the face of data.
The challenges of modern reporting are: structural, economic, human and cognitive.
How to make a good reporting?
Build a business report
Forget about business report with dozens of pages and choose an interactive solution instead! You risk saturating your employees' minds with endless reports. In addition, they will necessarily include information with little added value. Stick to the point ! An interactive solution allows this simplicity. In a slide, it allows you to filter the data. The information is therefore global and can be refined !
Quality reporting starts with a focus on its content. What are your objectives ? Do you want to increase your sales in New York ? Do you hope to open a new business unit within a year? Your report therefore depends mainly on your objectives. Of course, it is important to keep rather general KPIs. Those that inform you about your company’s overall performance are essential !
Your indicators must be comparable from one period to another. They must also be part of the decision-making processes ! Moreover, it may seem trivial, but your KPIs must be able to tell you exactly how you are performing. If overnight the number of your sales explodes, your data must bring you the causes of this increase. So, we could, for example, think about inserting sales, the arrival of new sales people in your teams, etc. in your overview.
In addition, a company-wide report requires data from different departments. It is a tool built collectively. It includes data from accounting, HR, purchasing, etc. Making all this little world work in synergy is particularly effective if the solution used is a SaaS. SaaS solutions, completely dematerialized, offer sharing like no other. Moreover, these solutions are in line with the evolution of the professions, they are simply accessible through an Internet connection. Thus, an external service provider (example: Non-Employed Financial Director) or a teleworking employee can easily participate in the construction of the reporting !
Besides, it must be borne in mind that sharing reporting meets a need for transparency and makes employees more accountable. As we explained earlier, one of the challenges of reporting is the human element ! We ask employees to participate in the production of data.It is therefore essential to give them feedback, adjust their actions and congratulate them on their success !
Good business report is also an evolving report ! The life of a company is dotted with good and bad performances, products go through phases of decline, departments close down… Dealing with these fluctuations is imperative.Your indicators must be flexible and you must be able to change some others.
The choice of your graphics is a keystone in the transmission of your information.
A good report:
- Contains only essential indicators (it is concise)
- Includes thoughtful KPIs
- Accurately reflects the health of your business
- Is interactive
- Communicates about the work of the employees
Example of commercial reporting (click on the graphs, this is a Powerslide!)
Business report is a tool used to study the performance of a company, one of its departments or even those of an association. It includes a limited panel of KPIs in order to get to the heart of the matter and facilitate the transmission of information.It provides its users a certain foresight, a look into the future.It is governed by certain rules such as conciseness, anticipation, collaboration or evolution.