It seems as if every day we are hearing the buzz word “visibility” more and more when it comes to financial management and analytical software. And well we should as one of the key benefits of modern financial management solutions such as Intacct is the visibility they can provide to the finance team, the organization’s management team, and other key stakeholders. Visibility to how an organization’s grants and programs are doing, and how your nonprofit is moving towards accomplishing its mission.
We need to get past the marketing hype and buzz words to really understand the importance of visibility and cure the blindness that often exists to how your organization is really doing. Visibility is not just about improving the timeliness of your monthly financial statements. While important, static reports of last month’s numbers and year-to-date is simply a snapshot of a moment in time for revenue and expense dollars; it is not true visibility. Visibility is real-time dollars and key business metrics side-by-side presented over a relevant timeline. Only that way does an organization have true visibility to the reality of how it is doing, what’s getting better, and what’s getting worse.
Most organizations are taking care of getting some kind of financials out each month or quarter. They may not be as timely as they should be, which is another problem altogether since their relevance diminishes every day past the end of the month. But raw dollars alone do not tell the “story” of how your nonprofit is doing since there is no context to the numbers. Context is only provided by the key metrics relevant to your organization and vertical. Those metrics might be a number of clients or members, meals served, beds occupied, daily cost rates, the list is endless. The metrics need to be visible so you can understand the trends that are happening within your organization and make strategic decisions accordingly.
Visibility is vital. Visibility that is both dollars and metrics presented in a format that resonates with the reader. If you don’t have visibility at this level, you’re still flying blind.
By Jacqueline Tiso, CEO & Founder of JMT Consulting, a national consulting firm serving the needs of non-profit organizations in the United States.