Operational Reporting Guide

Operational reporting offers leaders insights for specific time intervals, usually
focusing on the short-term. Stakeholders use the reports to support the rationale
for rapid decision-making. This article covers the types of operational reports,
examples and best practices for using them.

Inside this article:

• Benefits of operational reporting

• The two main systems of operational reporting
• The four types of operational reports
• How business intelligence tools are on the rise

What Is Operational Reporting?

Operational reporting is the act of detailing a company's day-to-day operations.

Usually, the report has visuals that show operations workflow. Leaders use the
report to make fast decisions.

Reporting ranges from basic to advanced. Basic reporting has a limited selection
of reports and fewer ways to make it your own. Advanced reporting automates
the process and lets you create reports from scratch and gather data from many
sources.

Key Takeaways:

• Operational reports in a visual format featuring a dashboard with drill-

down data help leaders make fast, informed decisions about daily
operations.
• Regardless of industry, the goal of an operational report is to improve
efficiencies and save money.
• Operational reporting supports analytics in real-time as well as delivering
on monthly or bigger picture data.

Examples of Operational Reporting

Operating reporting examples vary by industry. People in finance use an

operational report to focus on data needed for a client. A sales executive would
use the filters in a dashboard to see specific data. A marketing group uses it to see
if an ad campaign is effective.

The top three major industries that can optimize their business by using
operational reports include:

page 1
 • Manufacturing: Operational reporting is critical in the manufacturing
industry for many reasons. The goal is to measure vital parts of its
production chain to improve machine downtimes and operational costs.
Operational reporting is also useful for monitoring the complete production
line, measuring individual employee efficiency, and analyzing defect rates.

An operational report could include data on resource usage and costs,

production efficiency, and even how different machinery is performing.

Manufacturers monitor operations to avoid costly problems in the supply

chain and production line.

Leaders can make quick and accurate decisions by connecting details like
shipping, machine usage, and factory production flow.

• Shipment status
• Packout
• Inventory
• Shipment trends
• Equipment

Retail: Leaders in the retail industry use operational reporting to identify market
and product trends while strategizing the product line. Retailers can use insights
to manage the supply chain efficiently, optimize productivity, address customer
satisfaction and improve sales.

Stores can use data in operational reports to monitor the sales growth against
benchmarks and analyze individual sales per shift, calls made, sales numbers and
converted leads. The reports are also a good tool for recognizing loyal customers
and identifying the most lucrative customer segment.

Retailers can look at data related to how they position goods on the floor or
seasonality items by tracking sales data and other metrics daily.

Business intelligence charts and tables integrate data into an easy-to-read

dashboard. Leaders can process the information and share it with stakeholders.
Customize factors like vendor payment, current financial liabilities and working
capital depending on business needs.

• Working capital
• Cash conversion cycle in days
• Budget variance
• Vendor payment error rate
• Net profit margin

page 2
Warehouse: These facilities are responsible for activities such as fulfillment,
distribution, or ecommerce processes. Running regular reports for the warehouse
is critical for diagnosing the status of inventory and management processes. They
can help you identify products that raise inventory holding costs. Operational
reports also reveal ways to improve using a warehouse and best practices for the
labor force.

There are many types of warehouse reporting you can use to supply data. For
example, you can run reports on shipments by customer, history by supplier,
inventory on hand and cycle counts. Learn more about transforming the
warehouse.

You can use BI tools to simplify the look of data for fulfillment, distribution and
ecommerce processes in an operational report. Running reports for a warehouse
is critical for diagnosing inventory status. A visual dashboard helps gather,
process and present key data findings.

• Warehouse operating costs

• Project order rate
• Total shipments by country
• On-time shipments

When to Use Operational Reporting

When to use operational reporting depends on the needs of the

organization. Before you start building reports, identify what you want the
reports to tell you.

Organizations in every industry need to stay on top of processes so they

can get a complete view of data. Business intelligence tools with visual
operations dashboards and filtering options offer ways to download and
share real-time or monthly data analytics. An airline might track on-time
flights with operational reporting to find trends in delays and ways to
improve performance. Major shipping delivery companies like FedEx or
UPS use the reports to see if their coordination systems are running
efficiently. Those reports would focus on delivery times, delivery volume,
customer satisfaction and service coverage.

Why Is Operational Reporting Important?

page 3
The data in operational reports is crucial to helping an organization with its
business plan. Leaders present data in a report or dashboards and share it
internally or externally. This information allows workers and leaders to:

• Make informed decisions in real-time

• Identify ways to save time and money
• Enhance internal infrastructure
• Create long term company initiatives

What Are the Contents of an Operational Report?

The contents of an operational report vary by the type of data and how often you
run the reports. They usually contain information about one of these four main
types of operational reports:

4 Types of Operational Reporting

• Current information: These reports focus on things that make a facility

run. They include data on equipment, such as their current state, parts and
warranties. The reports also cover labor and tools in use.
• Current work and planning: This type of operational report is for how
work gets done. These usually include data about equipment schedules and
employee workload and availability. You'll also find information about
parts that are on reserve for upcoming jobs and those that might need
restocking.
• Forecasting or predictive analysis: These reports help managers schedule
and figure out if there are enough resources available to complete future
jobs.
• Historical work and trends: Use this type of operational report to view
historical trends about parts, equipment reliability and staff performance.

Depending on which kind of report leaders need, they can drill down on specific
information. That might include things like deliverables, costs of resources,
production surplus or deficits, employment records, financial structures,
organizational processes, and revenue.

What Is Included in an Operational Report?

Operational reports include different data points that take a deep look at
organizational processes. Usually, they also have financial reports.

Every operational report has the same goal. Specific data reveals different
challenges. The information leaders want varies by industry. Visual dashboards
show a snapshot of operations. They can also have filters. For example:

page 4
 • Financial operational reports include important key performance indicators
(KPIs) and metrics along with other relevant details like daily performance.
• Marketing operational reports include data on leads generated, cost-per-
click and conversions.
• Operational reports for technology measure response times and quality of
tech support.

Reporting is a different challenge when companies move to foreign countries.

Executives sometimes use a third party to manage the reports. Many global
companies use an integrated cloud-based enterprise resource plan (ERP) to
simplify financial reporting and accounting compliance that varies from country
to country. Learn more about selecting the right global ERP for your organization.

What Are the Main Systems of Operational Reporting?

There are two main systems of operational reporting: real-time reports and
monthly reports. Any high-growth strategy depends on both types of reporting.

• Real-time operational reports: These reports provide live data analytics.

Executives can access the reports as needed, focusing on trends, numbers,
and statistics as they change in real-time. Filtering results enables
managers to strategize in the short term and show them ways to become
more responsive and adaptive, with an eye toward improving overall
performance.
• Monthly operational reports: Top-level stakeholders use these reports
for a holistic view of operations. This data enables them to make decisions
based on long-term initiatives. A visual monthly operational report of top-
level KPIs helps managers and employees stay on track and revise goals.

It's important to remember is that without correct information on budgets, costs,

forecasts, supplies, labor and projects, it's impossible to know what kinds of
decisions to make.

What Are the Key Differences Between Functional and Operational

Reporting?

Functional reporting and operational reporting differ slightly. While operational

reporting looks at the overall function of the day-to-day business, functional
reporting looks at the challenges of individual departments. It focuses on the
functions and roles within the company.

Functional reporting looks at the operational report to focus on specific tasks. Its
goal is to use the skills of the employees within each department effectively.

page 5
Let's say an organization's operational reporting shows a performance gap—the
company's new goal changes to reducing overall costs. The result of the
functional reporting will then vary across departments. Accounting must find how
and where to cut costs, for example. Manufacturing, on the other hand, must find
ways to increase efficiency in their processes.

Operational Reporting Best Practices

Operational reports should be up-to-date and easy to read. Define the target
audience and the goal for the report. The business intelligence tool adopted should
have a dashboard that is easy to navigate with essential information at the top.

Other best practices to consider:

• Create a data story with a way to filter and sort based on what's important
to each user.
• Dashboards should show the top operational key performance indicators
(KPIs) at the top and then move to the next level of insights. The last view
should show more detailed information for a bigger picture view.
• Employ an automated batch process so reports are consistent. Most
operational reports come from a database that use an automated process
called a batch process.
• How a user navigates from summary data to the details is the information
path. A user should be able to find actionable information within three
clicks.
• Users need to understand the origins of data in a report. Add a link that
explains the data collection method, filters and formulas.
• Focus a user's attention with a traffic lighting approach—red, orange, and
green. Red means stop (or trouble), while green means good.

End – Study Function by Okeny

page 6