Recently I read a report from CFO Research Services (in collaboration with SAP) called “The Superstar CFO: After the Crisis” and I thought it brought up a few compelling points from a Business Intelligence perspective.
Subtitled “What it takes for Finance executives to excel in a changing and uncertain world,” this report really highlighted, to me, some changes that the winning CFOs are making to their own roles and the changes that a BI team must make in support of that.
The CFO’s New Role
The first change is that the CFO needs to know EVERYTHING about the business.
Not that long ago the majority of CFOs only had to understand debits vs. credits and how to get banks to lend the company money. In this day and age that just doesn’t cut it anymore. Obviously you have to have that solid finance background to do the job (and perhaps more importantly, to get the job), but it’s just the tip of the competency iceberg. Now your CFO needs to understand the key drivers of the business, how the operations actually work, what makes your customers successful, where your opportunities and threats are; the list goes on.
Why is all of this knowledge necessary? Because they have far broader responsibility than they used to. Personally I think it’s largely a long-term title shift. Used to be that a company would have a CEO and a President, then most of those got combined into a CEO/President that had all of the other CXOs reporting under that one office. I think eventually the CEO/President is starting to get a little tired and would like to offload some of that work, but can’t give up the title without giving up some paycheck. Enter the new CFO, who appears to be taking over a much more presidential role. Some of you are probably thinking “Hey, I thought the COO looked like they were going to take over as the new President.” You’re right. It all depends on the organization and the individual, but I think the CFO is, generally speaking, in a powerful spot right now because of the global hard times. When everyone is making money, Marketing has the power. When cost-cutting alone wins the day, the Operations department is in charge. When you aren’t making any money and no one will lend you any, Finance gets the square.
The end result is now a CFO who needs to know every day how every aspect of the organization is performing as well as how it will perform in the coming days because they are now everyone’s key business partner.
The CFO’s New Office
As a result of having to know everything about everyone all the time, the CFO is going to spend a lot less time behind a desk. The need for mobility is obvious across the industry, but the CFO’s needs are huge not only because they require a lot of work, but because they also give you a great excuse to build up your mobile support infrastructure.
There are tons of great, easy to use tools that allow you to leverage your existing SAP Business Intelligence investments on certain mobile devices (check out SAP’s offerings here and those from SAP partners like Roambi). Those, quite frankly are the easy part. Licenses for those aren’t out of reach, and setting them up isn’t that hard either. The hard part will be getting your organization ready to handle the mobile device onslaught. Policies, procedures, security concerns, mobile device management — all of these become a whole lot more complicated when you want people to look at anything besides email on an iPad. A goose from the CFO “needing something” is the perfect excuse to push them on these issues.
A lot of BI shops have “gotten around” that issue by simply delivering reports, dashboards, etc. into an email. Unfortunately, that no longer meets the needs of your new CFO. Corporate level information from every department is now necessary, and it needs to go all the way down into the nitty-gritty of each data point. Emailing that around is unmanageable and not nearly as secure as the security that can be built into enterprise BI tools. Seriously, use your CFO’s needs (and associated budget) to figure out the “meta-mobile” issues at a corporate level because it can be tough to justify it based just on BI.
The CFO’s New Data
So we know the superstar CFO needs more data, and we know it needs to be accessible from anywhere. What we haven’t talked about much is just how different some of that data really is compared to what is being delivered now.
The biggest difference is data quality. The CFO office has historically dealt with far more complete, accurate, and validated data than most other departments. In fact, the biggest pain for most companies (month-end close) exists largely to clean up data your organization has spent all month muddying so the CFO can use it. Not everything Finance looks at has always been clean, but it has always been cleaner than what operations works with day in and day out. Some technologies, like SAP HANA, will make daily operational data much more available and correct, but that isn’t quite ready-for-primetime.
The next great hurdle is what data is available. Lots of businesses run on spreadsheets. Spreadsheets are great for lots of things; reporting isn’t one of them. Your organization is going to have lots of data your CFO is going to be interested in seeing on a daily basis that currently only exists in a spreadsheet or on a dry erase board, or in a notebook, or in someone’s brain. I highly recommend using this opportunity to scoot the data from some of those places into a more formalized process that ends with the data in some sort of database somewhere.
While the pocketbook is open, I’d try to get some push behind a master data management project. Your CFO is going to be comparing sales, cost of goods sold, marketing spend, etc., and it would sure be nice if the product information and organizational structures and vendor names all lined up nicely.
It is very clear that the office of the CFO is changing not only in its scope of power but also its breadth of responsibility. This means that CFOs will need a lot more data than previously, AND that they’ll need to be able to access it from everywhere. A smart BI team will take this challenge (along with its accompanying executive focus and budget) to drive the need for a true organizational mobility infrastructure, the formalization of data gathering, and a master data solution if one isn’t already in place.