What Prophix Performance Management Software Does for Companies’ Finance Departments

Roger Knocker • December 3, 2023

What Prophix Performance Management Software Does for Companies’ Finance Departments

Prophix performance management software is used by companies for managing processes in their finance departments.


Corporate performance management software has mostly been used by larger firms, but medium-sized companies have in recent years realised the value of corporate performance management and the measurement thereof.


However, with it being rather new to their IT professionals, CPM is often misunderstood as being part of business intelligence. As such, they believe that if they already have BI systems in place, then CPM solutions are unnecessary. By clarifying what corporate performance is, it will be possible to see how Prophix performance management software can benefit the finance departments of medium-sized companies in South Africa.


What is CPM?


It is the overall term to describe the metrics, systems and processes in place for monitoring and managing business performance. It includes components such as planning and forecasting, financial consolidation, strategy management, and financial and management reporting. Functionalities include, for instance, monthly and rolling forecasts, statutory reporting, cost analyses, KPIs, scorecards, and more.


CPM thus entails the above aspects of business management, but it also entails the software that helps the employees perform the above functions. Prophix performance management software is an example of such a solution.


The above functionalities are performed by the finance department and are repeatable processes. With these functions being analytical, rather than transactional, it goes without saying that the company cannot use the same software used for invoice creation or payroll management as for corporate performance management. CPM software enables the automation of these functionalities, which in turn, helps with faster decision-making and improved performance management.


Why CPM is Essential


In the past, the finance departments relied heavily on spreadsheet models for the analysis function. However, spreadsheets have limited capacity and with the modern business environment being rather complex, it is essential to perform analyses on more aspects, such as inventory levels, product lines and more, in order to stay competitive. With an overload of data, such analysis is simply not possible in limited timeframes using spreadsheets, and this is why it is essential to use corporate performance management software specifically designed for the purpose.


Few departments were involved in the planning, finance and reporting functions in the past. However, in the modern business world, these functions are more collaborative, and this means more people are involved. As such, information must be made available to more people, and proper workflow management is essential, especially in tracking the movements of sensitive information.


It is thus essential for the finance department to strike a balance in disseminating information and handling analysis functions in collaboration with other departments.


In the past, CPM was expensive and as such, only the larger corporations could afford to implement it. Thanks to information technology developments, it is now possible for smaller and medium–sized companies to also implement CPM effectively using affordable and scalable Prophix performance management software. Prophix offers a low-cost model, due to internet technology being used to deliver the services. The savings gained are given through to the clients, thus making CPM affordable. Prophix performance management software is a fully integrated solution which means that the client has all the functionalities needed in a single solution. This, in turn, means lower cost of installation, quicker deployment, lower maintenance costs, and also lower cost to company when it comes to the training of personnel in using Prophix.


How CPM Benefits the Finance Department


The time needed to perform the CPM functions and processes is reduced considerably. It doesn’t, however, mean that employees will lose their roles. They are essential because they bring the decision-making factor. The Prophix performance management software, however, improves accuracy and reduces time spent on the various functions. As such, the employees have more time to analyse the figures, and this also means that they have less pressure and don’t have to spend time on repetitive tasks. The company thus gets more value from its qualified employees.


Make use of our expert guidance and professional assistance in helping your company implement and improve its CPM using Prophix performance management software. Unlike many other CPM packages which are customisable, Prophix performance management software is installed by professionals such as KPI Management Solutions, to ensure optimal configuration of the software in order to perfectly suit the client’s functionality requirements.

The Power of Finance: Visualising Data for Impact

By Clerissa Holm • March 18, 2025
In the world of finance, numbers tell a story. However, that story is often buried beneath layers of spreadsheets and complex datasets. For financial professionals, the challenge is not just about understanding these numbers but also presenting them in a way that drives decision-making and inspires action. Enter data visualisation – the art of transforming data into clear, compelling visuals. Among the tools that have proven especially powerful are the line graph and the waterfall chart. These visuals help finance teams translate dry statistics into impactful narratives. In this article, we explore how these graphs can transform financial storytelling. The Importance of Data Visualisation in Finance Finance professionals are accustomed to handling vast amounts of data, from profit margins and revenue growth to expense tracking and risk assessments. Yet, presenting these figures effectively to stakeholders is a different ballgame. Visualisation simplifies this process, turning complex data sets into accessible insights. When done correctly, data visualisation: Enhances comprehension: Humans process visuals 60,000 times faster than text, making it easier for stakeholders to grasp key information quickly. Drives decision-making: Clear and compelling visuals help executives make informed decisions without wading through dense reports. Highlights trends and outliers: Visual tools can bring hidden trends and anomalies to light, prompting timely actions. Improves understanding and communication with business - Business doesn't always get what Finance is trying to communicate and good visualisations go a long way to bridging the gap. Better communication improves alignment to strategic financial goals. The line Graph: Unravelling Trends Over Time The line graph, also known as a stream graph or a stacked area graph, is a powerful tool for visualising changes in data over time. It is especially effective in showing how multiple categories contribute to an overall trend. In finance, line graphs can illustrate revenue streams, expense categories, or investment performance in a visually engaging manner. Use Case: Revenue Streams Analysis Imagine a financial report for a company with diverse revenue streams, such as product sales, services, and subscriptions. A line graph can display how each stream has evolved, highlighting peaks and troughs. The thickness of each ‘line’ represents the contribution of that revenue stream to the total, making it easy to spot which areas drive growth. Benefits of line Graphs: Trends Made Simple: Displays how multiple components evolve over time. Visual Impact: The fluid, organic design makes it easier to follow changes. Comparative Insight: Helps compare different categories intuitively. The Waterfall Chart: Bridging the Gap Between Figures Waterfall charts excel at breaking down the cumulative effect of sequential data points, making them ideal for financial analysis. They help bridge the gap between figures by showing how individual elements contribute to a total. Commonly used in profit and loss statements, budget analysis, and variance reports, these charts provide clarity in understanding how specific actions impact the bottom line. Use Case: Profit and Loss Analysis A financial analyst preparing a quarterly report might use a waterfall chart to demonstrate how various factors—like increased sales, higher marketing spend, and cost savings—impacted net profit. The chart’s structure, with its clear progression from starting figures to the final result, makes it easy for stakeholders to follow the financial narrative. Benefits of Waterfall Charts: Clarity: Simplifies complex financial data by showing individual contributions to total figures. Transparency: Clearly distinguishes between positive and negative impacts. Decision Support: Helps executives understand the key drivers of financial performance. Choosing the Right Visual for the Right Data Selecting the appropriate visual tool depends on the story you want to tell: Use line graphs for illustrating trends across multiple categories over time. Opt for waterfall charts when you need to detail the step-by-step impact of specific factors on an overall financial figure. By mastering these tools, finance professionals can enhance their storytelling, transforming raw data into insights that drive strategic decisions. Conclusion: From Data to Decisions The ability to visualise data effectively is a powerful advantage. The line graph and waterfall chart are more than just visual aids—they are essential tools for financial professionals looking to make data-driven decisions that resonate with stakeholders. By adopting these techniques, finance teams can turn numbers into narratives that not only inform but also inspire action. In the end, the power of finance lies not just in analysing data but in presenting it with impact.
Financial KPIs Every CFO Should Track in 2025

Financial KPIs Every CFO Should Track in 2025

By Clerissa Holm • February 17, 2025
In the ever-evolving financial landscape of 2025, CFOs are tasked with navigating complexities ranging from global economic shifts to technological advancements. The ability to track and analyse the right financial Key Performance Indicators (KPIs) is no longer a luxury but a necessity. These metrics not only provide insight into an organisation’s financial health but also support strategic decision-making. Here are the top financial KPIs every CFO should prioritise in 2025: 1. Revenue Growth Rate Revenue growth is a clear indicator of a company’s ability to generate sales over time. This KPI allows CFOs to evaluate the success of business strategies and identify trends in market demand. Formula: Revenue Growth Rate = [(Current Period Revenue - Previous Period Revenue) / Previous Period Revenue] x 100 Why It Matters: Monitoring revenue growth helps CFOs assess performance against strategic goals and anticipate future cash flow needs. 2. Gross Profit Margin Gross profit margin measures the profitability of core business operations, excluding indirect costs like administrative expenses. Formula: Gross Profit Margin = [(Revenue - Cost of Goods Sold) / Revenue] x 100 Why It Matters: It reveals the efficiency of production processes and pricing strategies, enabling CFOs to identify areas for improvement. 3. Net Profit Margin While gross profit focuses on operational profitability, net profit margin considers all expenses, including taxes and interest. Formula: Net Profit Margin = (Net Income / Revenue) x 100 Why It Matters: A high net profit margin indicates strong financial health and the ability to manage expenses effectively. 4. Cash Conversion Cycle (CCC) The CCC measures how quickly a company can convert its investments in inventory and receivables into cash flow. Formula: CCC = Days Inventory Outstanding + Days Sales Outstanding - Days Payables Outstanding Why It Matters: In 2025, with supply chain disruptions and rising interest rates, efficient cash flow management is critical. The CCC helps CFOs identify bottlenecks and optimise working capital. 5. Operating Expense Ratio (OER) This KPI compares operating expenses to revenue, offering insights into cost management. Formula: OER = (Operating Expenses / Revenue) x 100 Why It Matters: Keeping operating expenses in check is vital for maintaining profitability, especially in uncertain economic climates. 6. Debt-to-Equity Ratio This KPI highlights the financial leverage of the company by comparing total liabilities to shareholder equity. Formula: Debt-to-Equity Ratio = Total Liabilities / Shareholder Equity Why It Matters: With interest rates fluctuating in 2025, maintaining a healthy balance between debt and equity is crucial to avoid over-leveraging. 7. Return on Equity (ROE) ROE measures the efficiency of a company in generating profits from shareholders' investments. Formula: ROE = (Net Income / Shareholder Equity) x 100 Why It Matters: A strong ROE signals to investors that the company is effectively using their capital, which is vital for securing future funding. 8. Earnings Before Interest, Taxes, Depreciation, and Amortisation (EBITDA) EBITDA provides a clear picture of operational profitability without the influence of financing and accounting decisions. F ormula: EBITDA = Net Income + Interest + Taxes + Depreciation + Amortisation Why It Matters: CFOs use EBITDA to benchmark performance against competitors and industry standards, making it a key metric for strategic planning. 9. Customer Acquisition Cost (CAC) As businesses invest in growth strategies, understanding the cost of acquiring new customers becomes crucial. Formula: CAC = Total Sales and Marketing Expenses / Number of New Customers Acquired Why It Matters: Tracking CAC helps CFOs ensure marketing spend aligns with long-term profitability goals. 10. Economic Value Added (EVA) EVA measures the value a company generates beyond the required return of its shareholders. Formula: EVA = Net Operating Profit After Taxes (NOPAT) - (Capital Employed x Cost of Capital) Why It Matters: EVA provides a holistic view of financial performance, emphasising value creation over short-term profits. Final Thoughts In 2025, CFOs must adopt a forward-thinking approach, leveraging advanced analytics and real-time reporting tools to stay ahead. By focusing on these essential financial KPIs, CFOs can drive strategic growth, ensure resilience, and foster long-term success in an increasingly competitive landscape. Tracking these metrics isn’t just about numbers; it’s about enabling informed decisions that align with the company’s vision and goals.