Data empowers financial leaders with a clear vision and focused strategy to improve operational efficiency in our increasingly challenging world.
In the not-too-distant past, the primary role of the Chief Financial Officer was to create financial plans at the beginning of the year and to report on the progress of those plans in order to understand cash flow and liquidity. This would slow down or green light key strategic spend. This careful tracking of metrics was, in many respects, how business intelligence was born. It was the dawn of balanced scorecards, financial metrics, and the careful tracking of plan versus actuals.
Faced with a world of faster business speed, increasing market risk, and accelerating digital transformation, forward-thinking companies are now asking more of CFOs. Today’s CFOs are transitioning from keepers of the balance sheet to strategic partners on the business growth journey. Increasingly, this partnership revolves around analytics. CFOs are asked to predict market conditions and currency risks, improve real-time credit modeling and provide much more real-time feedback as to the effectiveness of corporate strategies. A lot has been put on their plate, which requires a transition from the batch-oriented data warehouse world to something much more modern and nimbler.
If CFOs are to rise above the challenges of the current climate, they need modern strategies and solutions that leverage real-time data and analytics to fuel more timely and accurate decision-making.
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Real-time data and analytics – integral to every finance strategy
The first job of every finance leader is to make smart decisions based on the numbers. What has changed is the expectation related to the speed of these decisions. While only a few years ago, monthly and quarterly analytics were the norm, now decisions are required within hours or even seconds.
According to a report by Gartner, nearly three-quarters of CFOs (72 percent) are focusing on improving budgeting and forecasting flexibility this year. More than half are also committed to reallocating capital based on fluctuating demands (60 percent). Nearly as many (58 percent) are striving to redefine the employee value proposition within these new hybrid work environments that have been introduced. Another Gartner report found that CFOs’ number-one job over the next 12 months is to fund new or existing growth.
If finance leaders expect to deliver, they’re going to need a modern data strategy that enables agile decision-making and more accurate predictions and scenario planning. The centerpiece of this is the real-time flow of high-quality data.
See also: Financial Services 2022: Customer Experience Looms Large
Agility – essential for business success, critical to data modernization
Agility has quickly become a critical facet of every organization. According to a report by Accenture, a large number of banking CEOs believe that if they had embraced cloud technology sooner, they would’ve been more agile in responding to the pandemic’s many disruptions. This is going to be an important driver of examination, strategy, and investment in the years to come as business leaders think about what they could and should have done to adapt to the onslaught of unanticipated challenges.
And if they want to become more agile, they’ll need to first modernize their data strategy. With speed of the utmost importance – both in introducing new products and services, as well as responding to market needs and world events – enterprises can’t wait to catch up. If they aren’t taking action now, they are already light-years behind their competitors.
Speed has consequently become an imperative for the entire organization, and that impacts how businesses operate and how financial leaders support – and enable – everyone to run faster. By becoming more agile, businesses can more readily evolve their strategies and solutions. More significantly, they can better prepare to move in an agile manner and respond to ever-shifting and ever-evolving market forces.
Insights – invaluable to financial leaders and decision-making
Data empowers financial leaders with a clear vision and focused strategy to improve operational efficiency in our increasingly challenging world.
In addition to embracing an environment of continual change, leaders need to support more effective decision-making that aligns growth goals and cost controls. The ability to make faster predictions by leveraging the data accessible via modern platforms – and adopting technologies, such as cloud, AI, and automation – will enable the innovation and speed needed to stay ahead and deliver differentiated customer experiences in a rapidly evolving market.
Limitations – it’s time to eliminate data boundaries while still protecting data
There is a dizzying array of analytics tools available, but tools often suffer because there is a lack of access to the high-quality data that they need. Modern self-service analytics relies on the integration and careful catalog of data in order to put analytics tools to best use. These modern catalogs help to understand, inventory, and protect data. This ensures that the right kinds of data are put to good use while sensitive and private data is labeled and controlled.
Considering that the sources of data are growing at a very quick pace, today’s modern data analytics solutions must be capable of accessing insights from multiple data sources. From modern cloud data centers and on-premises storage to data lakes and enterprise resource planning (ERP) solutions, as well as data silos and more, CFOs need limitless flexibility to gather and use their data.
Data and analytics are the critical differentiators businesses need now
These are exciting but uncertain times, and it is imperative that chief finance executives remain at the top of their game. They may be more challenged than ever before, but data and analytics can help them persevere. It’s an uphill battle, but actionable insights make all the difference, empowering businesses to lead with data. And when they do, CFOs will be able to guide their respective firms through difficult situations and better navigate black swan events.
