Standardized reporting is an intricate type of reporting process that aims to produce consistent, reliable, actionable information from disparate systems or sources. A reporting process is standardized if it can be applied across different business units or sub-units in an organization. The processes that generate and collect the data to be reported on must remain the same across all the business units.
For an organization to understand the status of conditions in real time, and make decisions quickly, standardized reporting is required. A universal understanding of information enables clarity and transparency. Clarity supports effective communication based on trust. And studies show that effective communication leads to enhanced productivity and deeper customer relationships (Source).
It’s not a stretch to say that data consistency creates a competitive advantage over other organizations that do not have standardized reporting processes.
First, let’s explore why standardized reporting creates business value in more detail.
Standardization Enables Quality
If an organization records data inconsistently, reports built on that data are meaningless. For instance, to run a standardized report on sales, there needs to be a consistent definition of what counts as a sale. Do gift cards count? Are returned items included or excluded? Are sales in the US calculated the same way as sales in the EU? There are a million different assumptions that a simple data point could contain. It is impossible to know if data is accurate without standards.
Quality Enables Clarity and Transparency
When employees are able to understand what certain figures in a report mean, despite cultural and language barriers, it creates a built-in transparency. Employees can use standardized reports to communicate clearly, regardless of department or geographic region. In addition, broad visibility of data across an organization encourages team members to be proactive with an issue. If results will be clearly and broadly reported, and a responsible party sees a problem that could reflect poorly on themselves or their team, they are more likely to raise the flag early.
Clarity Enables Trust and Productivity
Once data consistency allows everyone to understand the same information, employees are then able to communicate with one another more efficiently and effectively. Transparency is critical for establishing a layer of trust within an organization and improving morale. Allowing all employees to obtain this insight at the same time enables them to spend less time investigating and asking clarifying questions. In turn, this allots employees more time to add value to the organization in other ways.
Consistency Is the Key
Data consistency is both the key to the whole process and the most challenging component. Without data consistency, the resulting report would be of no value—or worse, misleading.
Establish data consistency for a standardized reporting process.
Think of standardized reporting as an ongoing process, not a one-off deliverable. As such, the planning phases are critical. But all too often, an organization will skip over the step of defining the goal of the report.
To obtain consistent data and unlock all the benefits of a standardized report, an organization can follow these steps:
1. Understand the decisions being supported by a given report.
Ask, “What are we trying to accomplish with this report?”, “What decisions are made using this information?”, and “What insights will help the organization achieve its goals?” Within a standardized reporting process, there are many things an organization might decide to track. The first step to getting data consistency is to understand what actually needs to be tracked. A holistic understanding of the purpose and what information must be conveyed will dictate the data requirements.
2. Identify the standardized procedure for how data is generated.
To achieve data consistency, there must be a predictable, measurable process in place.
For example, the business systems team of a multinational organization wanted to develop a standardized report to understand how employees across 8 countries create internal SharePoint sites. The team wanted to reveal information like how long it takes for sites to be created, how many files are on each site, and how often employees request new sites to be set up.
Standardized reporting only works if the business process for creating these sites are the same, and the data about each step is recorded consistently. (How does a team member track the time it takes them to set up a site? Does the clock start when the request comes in, or when the task is initiated? Are teams reporting the total amount of storage used by each site, or just the number of files? Are all file types counted equally?)
Ask, “How is the data currently generated?”, and “Is the process in question being performed consistently?” If not, stop here and standardize the basic underlying processes first.
3. Develop tools for mining the data.
Data may be captured and compiled manually in batches on a simple Excel spreadsheet, automatically in real time using a sophisticated ERP system, or a combination of both. Create an MVP process first to test out various mining approaches before investing in a more robust system.
4. Design templates for presenting the data.
Present the data in a layout that is easy to understand for the intended audience. Just as the data needs to be consistent, the report UI must be consistent to avoid confusion, improve clarity, and establish trust.
5. Train employees.
Without proper training, human error will create variability in the data. Training and proactive IT support will help employees generate and collect data in a predictable manner and reduce friction from the standardized reporting process.
Consistent, high-quality data paves the way for a universal understanding of business information and sound decision making.
Too many organizations attempt to implement a standardized reporting process before understanding the objectives. Others start down the path but abandon ship when they can’t harness data consistently. They want the benefit of the reports instantly while forgetting about the underlying processes and requirements. Organizations that initiate standardized reporting need to certify that meaningful consistency of data is the main component.
Once an organization obtains meaningful, consistent data, standardized reporting becomes possible, enabling transparency and trust.