What Are Finance Analytics?
Financial analytics are a method of processing and analyzing business financial data to help attain more in-depth knowledge about performance and provide insights about the best course of action in any given situation.
While Business Intelligence (BI) processes have a very distinct and specific role that deals with the business’s financial data in the past and present, analytical finance, or finance analytics, deals with the future, helping companies accurately predict outcomes and make better overall decisions.
For instance, business analytics in finance help to calculate and forecast various performance indicators, such as revenue and profit.
Analytics, financial analytics especially, can also help forecast business performance. This is helpful in seeing when it’s necessary to make adjustments to either maximize the current upwards trajectory or prepare for a potential plateau, minimizing the damage.
Some of the aspects that fall under the revenue analytics definition include helping to understand and predict the cash flow, income, costs, and many other vital performance indicators.
But primarily, financial analytics help to answer specific business questions about your performance, giving you the best chance of making the right decision in any given situation.
To make the most out of what analytics of finance performance can offer, it’s essential to know which key performance indicators you should focus on.
And since one of the most important aspects of facilitating business growth is prioritizing the time that you have available, client profitability analytics should always be on the list of indicators you are tracking.
Some clients will inevitably be low in terms of potential profitability, taking up time and resources that could be used to make your best clients happy. By tracking how each client stacks up, you can learn to not only prioritize the top earners but also identify the key traits that they all share.
As briefly mentioned earlier, you should also use financial analytics to predict sales, as it will allow you to allocate your resources more effectively.
When launching new products, you need to have data about your current and previous product performance so that you can figure out what types of products tend to provide you with the biggest financial gains.
In today’s crowded markets, financial analytics help keep the competition at bay and find new ways to gain the upper hand and grow.
Advisors need to use data to attract clients and fill out attendee lists for financial seminars. At LeadJig, we can provide you with all the financial services marketing tools necessary to make better decisions based on intelligent data. Request a demo today to learn more!