HOW FINANCE LEADERS CAN UNLEASH THE FULL POWER OF ANALYTICS

Debbie Green, VP of Applications, Oracle

 

Financial teams across the UK have been repeatedly told that data is the key to helping a business thrive. But the reality for many finance teams is that the key data is not truly in their hands (yet) as they are left trawling through hordes of data to find simple answers to their questions.

This is why there needs to be a new approach to analytics for finance professionals. Put simply, they need to be given the tools that make it easier to stay informed about key financial measures. Finance leaders could then be empowered to make business critical decisions if they had access to a simple resource that allows them to set alerts on the most-relevant KPIs, review data through visualisations and narratives, and share these findings with colleagues via an app like Slack or WhatsApp—all from an app on their phone or laptop.

Debbie Green

Analytics should be tied into the everyday work experience of the finance team and be used regularly to track performance, monitor activity and run what-if scenarios. In essence, the data should be coming to the user, rather than the user having to seek the data.

For example, a CFO at a company focused on top-line growth may set KPIs around operating expense, capital expenditure and payroll-to-revenue ratio, so they can see how the business’ focus is affecting the bottom line. When certain thresholds are reached, such as the cost of payroll getting close to reaching an unstainable level, finance leaders will be alerted so they can drill down into the analytics and plan their next steps strategically. They should be able to then share these insights quickly with their team so that they can react with agility and speed.

 

CFOs driving strategic change

CFOs hold a unique position in the modern business, if they have the ability to access data and gleam insights from across the organisation. This will not only lead to the evolution of the finance team, but also made them a vital cog in the successful running of a business.

As CFOs and their finance teams play an increasingly strategic role, they are often the ones driving investments in digital technology and advocating for more new business models, such as moving to a subscription model.

Finance leaders are increasingly becoming the biggest champions of data and analytics, but many companies are struggling with what data-driven actually means in practice.

What it often means is transitioning from a spreadsheet-dependent, collect-and-report business to one that can use data to make strategic decisions across functional areas—for example, shifting the marketing and sales strategies in a region based on projections of supply and demand. It’s a complex process involving big changes to business processes across teams, as well as to data management and access, and the very culture of decision-making in an organisation.

But to make this possible, companies and their finance teams need to be able to access this data easily and have the ability to perform the necessary analytics. It also requires a more holistic approach, where data is pulled in from multiple sources from across the organisation, so that CFOs can view performance across the company and make decisions based on these insights.

 

AI powering greater insights

What will drive even further insight and empower the finance teams more, is ensuring that Artificial intelligence (AI) and Machine Learning (ML) is embedded into these analytic tools. Going forward, every aspect of the production and consumption of data insights will be augmented by AI.

A productivity gap is already widening between companies using legacy systems and those using cloud-based AI and other advanced technologies. For example, industries with high productivity growth—oil and gas extraction, media and communications, and agriculture—invest in digital technology at a rate five times higher than low-productivity sectors. These industries have learned that they can seamlessly introduce ML and AI into their processes thanks to the cloud. They know that investments in these technologies have the broadest impact in the cloud compared with legacy systems and infrastructure.

When finance leaders set the KPIs they wish to analyse, a machine learning algorithm can simply sit in the background, constantly learning how each user interacts with the system so it can further personalise data and streamline processes. This gives businesses the edge, as they can quickly access the most important data and analyse the insights that can help their business thrive.

As the importance of the finance team continues to increase, it’s time to put the power of analytics in their hands.

 

spot_img

Explore more