Business performance management software for small business

For many in business the term performance management software relates to employee performance and their performance reviews. Here at Phocas, we think of it as a much broader concept covering the measurement of the overall financial and operational performance of your company which of course includes employee engagement, goal setting and much more. Think of it as 360-degree feedback on profitability and including human resources data in your headcount planning so budgets are comprehensive. This means you can streamline continuous feedback by comparing budget against actuals and help all your teams achieve high performance.

Monitoring the performance of your business and employee goals is a critical part of current and future success. Unfortunately, many small businesses lack the software solutions to effectively track their organization’s performance. They most often carry out performance evaluations and reporting using Excel spreadsheets (a recent Chartered Accountant study found 84% of respondents use Excel as the primary reporting tool) to manually manage performance data.

Traditionally, performance tracking tools have been mostly used by larger companies enabling a business to understand its current financial performance and meet future goals. At Phocas, the performance management solution is embedded in the Business Intelligence (BI) and Financial Planning and Analysis capability, tapping into your data to lead your organization in its strategic goals.

Thanks to the introduction of lower-cost tools and methods, finance teams can take advantage of customizable support for financial planning, budgeting, modelling, and performance management, all within one system that’s integrated with the rest of the company.

As you consider whether performance management software can work for your small business, here are some tips to help you make the switch while staying within budget.

1. Start small

Appraisals and assessments are based on metrics so to reinforce the importance of tracking metrics, make them part of the onboarding process, decide on the most crucial data you want to obtain and use the BI tool to build an easy-to-read dashboard for every person every day, not just for the review cycle.

As well as having a system for regular check-ins for your people, global consultancy Deloitte recommends a one-page “pulse report” (a type of management report) that shows key metrics for tracking revenue, operating performance, and working capital. This report should be released weekly, allowing other departments to keep up to date on any changes in the key metrics or you can create and automate numerous reports for each branch with add-on customized metrics to suit your business.

Although the report can be done in Excel, using a BI tool like Phocas can automatically generate the information you need much faster – and it’s simpler for goal management and identifying major insights.

2. Encourage collaboration across planning

A shift to a performance management system involves the entire company. To make the most of the software, you use access to consolidated data for cross-functional planning involving the finance, sales, human resources and operations departments. Often these discussions about budgets and targets are difficult to achieve without comprehensive data.

The same Phocas BI and FP&A platform enables your finance team to use the consolidated data to build budgets for the fiscal year that include financial modelling and scenario planning.

For example, if your sales manager is planning to add five new employees to the sales team, finance can plan out that scenario and its effect on financial performance and discuss whether this is feasible with human resources and sales. These tools help small companies make accurate decisions and ensure the right hiring decisions are made.

The workflows in the software also allow for peer feedback and for all team members to set goals that they accountable and actionable. Performance management tools enable you to be proactive instead of reactive – which is one of the most valuable ways to drive business growth.

Each department should have a stake in the performance management process and understand how it benefits their day-to-day work.

3. Facilitate company-wide decision making

Once the data comes together, then your company can streamline the insights, learning management sharing of financial performance. There is no more confusion or the potential to be looking at entirely different financial indicators across departments with an integrated BI and FP&A tool. The best performance management system lets you manage all your financial planning and analysis in one platform. Look for a cost-effective option and with a user-friendly interface, then it won’t take long to get everyone onboard.

The platform allows companies to run their business function on a live platform that identifies market changes and cash flow dips in real-time.

The software, built on a BI platform, enables your team to use financial and operational data across the entire organization — so your finance team can forecast for the whole business, plan for a variety of business scenarios and budget collaboratively. This data also allows you to run fair employee reviews and help people with their goal tracking.