Large companies with an extensive management structure pay great attention to accurate and full consolidation of business information. And due to the complexity and special features, the process requires automation at a maximum level via proper business software.
Let’s look at this process more sharply. Consolidation is the combination of business information of several divisions, branches or subsidiaries into one place. Consolidation is carried out at several levels: purchasing, production and financial. The result of the process is the unification and synchronization of all business processes within one system, which helps to obtain comprehensive data on all business activities in detail. Companies may have different business software to handle all of these processes. For example, the digital startegy of a company may include planning software, business performance sortware, budgeting software, financial software and so on. However, it is not enough to simply bring company data into a single database. Below we stipulate several principles that are the basis for the data consolidation process.
The consolidation process must fully define all corporate assets, liabilities, expenses and income of all divisions. In addition, the consolidation perimeter should be as wide as possible and cover all subsidiaries and affiliates in order to obtain a correct result.
A unified methodology
The process of combining business information must be structured according to a common methodology. It would be extremely wrong to allocate the same items into different groups depending on the corporate division.
Constant and stable methodology
Consolidation methods should be determined at the initial stage of the system design, and then they should be maintained for a long time. Changes to the methodology must be justified, and if a decision is made, it must be extended to the entire perimeter of the consolidated data, including past periods.
This is the most important point in information consolidation. Consolidated information should allow users to look at a specific indicator among all the consolidated divisions, compile an aggregated indicator for the entire company, and, if necessary, add details to the available generalized data. Look how we have realized it in Retail.
To fulfill all of these principles, it is very important to find proper business software. Such tools must include the features of planning software, database processing software and budgeting software. Look how Spreadym works to understand how all of these features can be compiled in one place.