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Author's profile photo Edwin Geel

Impact of ‘Big Data’ on the Next Generation CFO

Co authored by Joshua Abraham.


Picture this,/wp-content/uploads/2014/05/two_businessman_talking_449783.jpg

Two young CFO’s meeting during the roaring 20’s of the last century

“I have bigger bank credits than you” says one CFO to another. And the other one is inspired to build better factories and invests his money wisely

In the early 50’s, they meet again

“I have bigger factories than you” says the CFO to the other one. And the other one does not think twice and starts to create better products with higher quality and better design.

These men grow old and by the early 90’s they still argue.

“I think we have bigger computers than you” and the other one starts to implement smart ERP solutions to become more productive and drive efficiency throughout his company.

Today, their grandsons have a similar conversation.

“We have bigger data than you”. The smarter CFO runs off to use all his data to engage in better relationships with his customers and make sure he simplifies the buying process for profitable products and services every time they come back to shop.

But wait.

Why are we talking CFO’s here?

What is happening in the CFO space?

Because they play a crucial role in the success of what the BIG Data revolution can do for companies. When we look at a CFO’s Big Data priorities, we are talking about the 4 V’s, as in Volume, Variety, and Velocity & Value which ultimately defines and shapes todays financial insight. Ever since the emergence of ‘Big Data’ to quantify and simplify what would otherwise be unimaginable amounts of data to be handled and processed, we now have the opportunity to pour through billions of data sets from financial records to live feeds in a matter of seconds, thus changing the age old perspective from tedious quarterly reporting to daily reporting based on actionable insights.

The success of companies today now depends on their ability to effectively capture, analyze and extract key insights from data. While Enterprise Performance Management and Finance Analytical Solutions today envelope these functions to support management in effective decision making, the growing emergence of Big Data is going to change the face of these spaces as we know it. Predictive analytics from SAP for example now allows us to dive into the future while giving us a glimpse of what the end picture looks like. The benefits are plentiful, from better financial forecasting to live hedging of currency rates on the go. But the question lies in why we haven’t been using predictive analytics in finance up until now. Slow hardware? Slow Software?  More reconciling, less analyzing?

But NOW with the rapid growth of technology which not only underpins ‘Big Data’ capabilities but re-defines the playing field as we know it.  Solutions like SAP’S game changing HANA platform with market leading ‘in-memory’ computing are already proving its worth in Enterprise performance management. From calculating budgets and financial closes almost instantly to providing access to vast amounts of multi-dimensional cost and profitability data in nano-seconds, the possibilities seem endless. This technological boom allows for Big Data to infiltrate the financial sector like never before. A recent survey featuring 1200 global customers has shown that Finance is now the 2nd highest ROI area with close to 69% of revenue being generated from financial operations. With the Big Data explosion all around us, the prime focus for CFO’s now lies in actively Engaging, Visualizing and Predicting big data to not only deliver added value with services but also balance it with a constant growth in revenues, profit & essentially customer loyalty.

Real life examples paint the picture and tell the story.

With the imminent data explosion, information handling and data processing has been the primary bottleneck. Up until now, our experience in handling excessive data has been characterized by more time been spent on reconciling rather than actively analyzing data. Complex and costly data management functions were further responsible for high TCO’s and were not designed to handle Big Data. But with recent advancements in big data support functionality, finance is now being used to leverage Big Data to get rid of our data handling incapacities but even more so essentially maximizing visibility. With Big Data ready service offerings clubbed with state-of-the-art BI solutions, we now have the ability to generate visual stories to optimize our data-driven decision making.

But exactly how visible is this Big Data influence in running EPM solutions today. A leading provider of telecommunication services uses SAP’s Profitability and Cost Management to process its rapidly growing big data complexity enabling them to handle upwards of 100-150 Billion records on a multi-dimensional playing field every month. This was unthinkable a couple of years ago.

A very well-known  internet retailer, now places all of it cash driven data on SAP’s HANA database thereby reducing processing time by up to  99.72 % when it comes to analyzing its 5 million daily transactions. As a result, they now have near immediate decisions on applying cash and currency which saves bottom line money.

Big Data is now breaking the barriers in finance. The numbers speak for themselves. Upto1350x report speed improvements, generating an all new reporting experience with near second response times. Up to 987x improvements in Document Journal Reporting or up to 71x faster clearing of incoming payments,

the benefits are numerous.

But still, why the CFO?

Still though, why is the CFO one of the key players in this BIG Data thing? Because they have always been working with data. Running the numbers through & through is the trademark of any good CFO organization. With that comes the natural relationship with groups who physically run the numbers, from the IT department in any organization to the data crunchers within the organization, there is clearly a tendency that the owners of the data, be it the marketing people, the supply chain people or the contact center folks to name a few begin to understand what the actual value of that data really is. Especially in the BIG Data context where opinion leaders like Forrester define BIG Data as the combination of “all the data” (that is one way to look at it and let’s use that here), all these owners now see that it is their data that is of importance but at the same time there is also the need to collaborate to generate maximum value out of it.

Traditionally this is where the CFO plays a key role. Being able to translate data into business insights as they have done in the past, being able to connect non-IT departments to IT groups and making sure business dimensions do not get lost in discussions is at their realm of possibilities and of prime importance today. Picture BIG Data as the building blocks of a new bridge between Business and IT, then the CFO is best positioned to build that bridge.

Here at SAP Analytics & BIG Data services, we have services available for you to get that process started and be successful. So if you are a CFO, it is something worthwhile doing right now. Go ahead and visit


Edwin Van Geel is a key member of the Global Analytics& Big Data Field Services team and global practice lead for Enterprise Performance Management Services. Edwin contributes regularly on thought leadership topics and content in Finance, Analytics, Big Data and Innovation for Business.

Joshua Abraham (Joshua Abraham) is from the SAP Field Services EMEA BI practice and brings new perspectives to the field of BI. He currently works on his thesis.

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      Author's profile photo Kurt Holst
      Kurt Holst

      Hi Edwin,

      Thanks for sharing your views on BigData and Advanced Analytics.

      Very nicely framed.

      I am a looking forward to follow the next blogs.

      Best regards,