More Information, Less Data: The Key to a Thriving Finance Function
What if your business could subsist on more information and less data? Information is power – whereas data, useful as it may be, typically involves a set of extra processes before you can use it. So how can you navigate a murky sea of massive data to find those valuable pieces of information? It all starts with modernizing your finance organization.
During a recent SAP Game-Changers radiocast, panelists Eric Merrill, senior manager with Deloitte Consulting’s strategy and operations finance practice; Mark Richards, VP of finance and operations for RBA Consulting; and Dan Fagan, member of SAP America’s industry value engineering team shared ideas on how to leverage data, benchmarking, and metrics to bring your finance department to the cutting edge of innovation.
Where we are with finance modernization
The finance function has drastically changed in the wake of a technical revolution. Increased automation means finance is moving away from accounting-based practices and toward decision support and decision analytics. Real-time operations and information are opening up a world of possibilities for finance to truly partner with the rest of the organization and provide some strategic decision support. It’s not enough to report the numbers quickly and with accuracy – it’s now imperative to tell a story with those numbers that can help enhance decision making across the company.
Fagan points out that when financial leadership has access to dashboards that provide a timely, daily view of team metrics such sales information, it yields a 20% lower cycle time for the financial forecast.
According to Richards, “The key for success here is really coming up with a good strategy around how you’re going to manage your data and then where you need to manage that data.” He suggests finding an optimal balance between operational and financial data that yields the most critical information. Innovative dashboards and cockpits can help with this and enable finance to make sense of Big Data in real time – so CFOs can provide the kind of insight that makes them an invaluable strategic asset.
Where we’re going with finance modernization
Merrill asserts that the next step in modernizing finance is all about prediction. “The next evolution is to not just look at what has happened in the past, but increasing accuracy and visibility and predictability of what’s going to happen next.”
Richards offers perspective on how much more the finance department can offer with enhanced predictive capabilities. He quoted words of wisdom from his old boss, who highlighted the issues of an antiquated finance function: “The problem with finance people is you have 100% of the information after the fact. If you could make that same comment to me when you have 25% of the information like operators do, then your financial counsel to me will be relevant.”
Now that vision is closer to a reality than ever. CFOs are relying on real-time dashboards and cockpits to transform proliferating data into a steady stream of information that the business can put to use. As such, the role of data scientist has the potential to take center stage.
As Richards explains, “If you want to really be seen as a business partner, you do have to show that you understand the business as well as the CEO.” And the best way to do that is with reliable tools that help you see the future and steer the business on a sound course.
To learn more about the myriad of ways to modernize the finance organization, listen to the full radiocast.