Advanced data analytics is seen as a part of every industry now. The requirement and use of advanced data analytics have gained significant traction in a while.
Accessing and analyzing large and expanding sets of internal and external data in an accurate and controlled manner is a substantial challenge. When such challenges are combined with the strategic nature of the decision-making process that finance organization’s enhanced data analytics support; it largely illustrates why most CFOs (Chief Financial Officers) prefer keeping capability in-house and manage it in a centralized manner.
The structure can do a bit to ensure the success of enhancing analytics. Still, other steps can help CFOs and their finance organizations get the upper hand on the advanced analytics efforts.
Such steps are mentioned as follows:
1. Get comfortable with data sets
CFOs are searching for data or accurate reporting that can work toward the core of their mission. It puts finance executives to work as they have to find out data sets and analyses that they have grown comfortable performing over time. The finance customers are requesting the data sets that produce advanced analytics in factors of 10, 20, or more that expand continually, giving away the credit to digitalization’s onward march.
The difficulty can be to the CFO as the data fluidity can make it challenging for his/her traditional mindset. Thanks to finance organizations, they can help CTOs over their reluctance to plunge into larger data lakes by indulging the right skills, technology tools, and governance structures.
2. Encourage and implement data governance
Effective data governance is a strategy made at the enterprise-level and capability that establishes methods to control and oversee organizational data use. To ensure it doesn’t fall on the CFO’s plate, the finance group needs to make sure that a mature data governance program is in place and follows data governance policies and processes.
While the process is going on, the CFO and finance organization can trust the data used in the analyses and control the security, quality, and integrity of the enterprise’s sharing, storage, usage, and reporting.
3. Try reducing the skills gap
Above all, a CFO must continue to understand and address the skills gap within the organization and groups. This is supposed to be a never-ending process. It requires considering a range of skills-sourcing mechanisms, funding upskilling programs, rethinking hiring profiles, and deploying flexible labor models. In finance, digital proficiency should have a forward-looking perspective than historical reporting.
All of it requires a comprehensive understanding of where data sits throughout the organization; it generates the requirement of profound knowledge for the business and challenges faced by internal and external stakeholders. Additionally, it demands strong coordination with IT organizations.
The need for skills doesn’t end here. Core financial planning and analysis skills are a must, along with fluency in advanced technologies. The term ‘technologies’ refers to artificial intelligence and automation in all forms.
The CFOs are designated with four unique roles: catalyst, steward, strategist, and operator. And these roles make their position a suitable fit to lead the analytics efforts. They can catalyze analytics innovation, boost the innovation process, take the lead position for implementing analytics, and handle analytics to stabilize the bottom line.
Additionally, it is undeniable that the CFO’s broad understanding of the business, growing technical knowledge, and overall leadership skills are precious to hand them over the data analytics job easily. Therefore, as per the norms of good business sense, it is no risk to put such crucial things into the hands of CFOs.
All of the above
Now, CFOs need to recognize and understand the importance of analytics capabilities, which will uplift the board of directors, CEOs, executive management peers, and many internal customers. The experience and conditions witnessed so far depict that executives and board of directors are already committed to investing a significant amount of money in advanced data analytics. Thanks to the pandemic-era that helped them get well-equipped with unexpected and difficult circumstances.
In a nutshell, it is time for CFOs to step up and get comfortable with the new era in finance and advanced data analytics.