With the arrival of more powerful software programs to the world of finance operations, CFOs can more readily take ownership of a company’s data analysis and offer information faster than in years past. This ability to have an effect on day-to-day operations allows a CFO to go beyond budget planning and forecasting and better influence the direction of a company.
Traditionally, CFOs already use analytics to determine how to allocate resources and manage budgets. However, bringing all of a company’s data into one central department – “owning” the data – a CFO can take on a larger leadership role within business operations. Examples would be to suggest ways to price products differently or how to manage inventory in a supply chain.
If a CFO owns analytics, he or she can better support operations and perhaps discover cost-saving methods, suggest new price points, or create new methods of gaining customers. As the keeper of overall data, a CFO can give a true picture to a CEO who previously may have met with various managers to gather data about sales, customers, and inventory. Having current company-wide data available allows a CFO to better impact decision-making in many areas of business, such as pricing, customer tracking, asset information or supply chain workings.
Data analysis is also about helping to improve the immediacy and quality of decisions that are made. In owning analytics, a CFO can help a company look to the future when it comes to products, services, vulnerabilities, growth opportunities.
In a 2013 survey commissioned by Deloitte called The Analytics Advantage, the first annual survey on the state of analytics readiness at leading corporations, 20% of the 100 respondents were unable to identify who within a company was the executive responsible for analytics. Just 18% of the respondents replied that the CFO was the one who oversees analytics. Most thought that a business unit or division head was responsible, at 23%. Yet, within a company, the CFO is the most likely person with the aptitude and data knowledge to be the one who can best interpret and advise a CEO toward future decisions and a forward-thinking perspective.
Centralized analytics allows for better business decisions
- The CFO who can provide accurate data in a timely manner achieves respect when the information is accurate and allows a team to collaborate on planning for the future.
- Having data available through use of technology saves hours that in the past took staff days to analyse, becoming instead available in a matter of hours – or minutes.
- Cloud-deployment products become available to users in various locations, and thus, makes the CFO’s job easier and the teamwork more thorough when all can access the information together at the same time.
- A CFO who has fast, accurate data can also identify new revenue streams and key performance indicators, as the data shows what is happening in the world of business shortly after it happens.
Being the steward of a company’s analytics in a centralized system also allows the CFO to have a complete picture of the company’s operations and ability to come up with the questions for a CEO to consider. Raising the profile of analytics within a company allows a CFO to gain more credibility as you interpret the data for others. When a CFO becomes an expert about analytics technology that exists, you become more of an asset to a company, as well. Articulating the data through real-time examples should be the job of a CFO whose strengths lie in the interpretation of data – not just in developing a budget, but also giving scenarios for the “what if” situations for product development, marketing and inventory control.
The CFO who “owns” and has reliable data becomes an important resource for the CEO and division heads who will look to him or her as they make business decisions within their own areas of responsibility. Making a case to a CEO about centralizing data analysis is a positive direction to take in today’s world of technology where data drives management and operations.