In today’s digital ecosystem, CFOs can extract a significant amount of enterprise value from data, assuming that it can be turned into meaningful insights and measurable actions. However, many CFOs struggle with one key issue: their organization’s data is neither reliable nor complete enough to drive consistent results.
Data Challenges CFOs Face
Today’s CFO faces critical challenges in harnessing data.
No single system constitutes the complete source of financial truth
While the notion of a “single source of truth” is important, CFOs understand that it is the aggregate of an organization’s numerous financial systems that comprises that holistic information factory (e.g., data warehouses, big data lakes, analytical tools, etc.).
CFOs serve a diverse set of constituents who expect timely, accurate reporting and analytics
As the central hub for data, the office of the chief financial officer (OCFO) must ingest and work to integrate information from every corner of the enterprise in order to generate period-end financial reporting and analytical needs for business users. These constituents expect quality data with attestation level commitment, such as key performance indicators (KPIs), time horizon analysis, summary reporting, and visual formatting to drive decision making.
The burden of poor data quality as it rests on Finance
Without proper technology, savvy finance specialists are forced into positions of technical “clean up” experts who spend countless hours locating data across disparate systems and transforming data in spreadsheets to achieve accuracy and integrity.
When economic disruptions occur, the CFO is front and center in re-planning and adjusting enterprise resources. Often these disruptions come with very little warning and occasionally, every eight to ten years, they pack an enormous punch. Today, a global pandemic is reeking recursive economic impact that requires daily decisions over cash flows, budgets, and investments. CFOs are required to continually adjust every aspect of their firm’s financial position as the disruption lingers.
The Data Empowered CFO
While CFOs face significant obstacles in their quest to harness and optimize vast volumes of financial data, they are also in the perfect position to empower their teams to enhance the overall data culture of the organization. Data Empowered CFOs drive results through several important actions.
Instilling leading practices and benchmarks to measure business performance
By executing constant improvements in operations, controls, automation and analytics, CFOs provide the enterprise with essential reporting targets to help identify critical operational data and analytics requirements that drive the finance operations forward.
Attracting and maintaining high-performing teams
CFOs have an ability to appeal to, develop, and leverage high-performing teams in challenging conditions. Data driven financial analysts can enforce business and financial logic in complex environments to produce reliable results.
Empowering teams to build analytical models that impact mission-critical decisions
The data-driven CFO invests in analysts and technology to create models that can clearly and efficiently forecast outcomes of decisions in ever changing conditions. Business insights are gleaned to forecast performance.
Engraining business agility as the center of the organization’s financial hub
Business agility is the way the OCFO predicts, responds to, and adjusts the financial balances of the enterprise in real time with significant economic disruptions. The CFO drives financial agility through timely and authoritative data-driven views of enterprise conditions and external forces.
CFO Data Leadership for the Modern Competitive Landscape
The reality is that all CFOs are in fact data-driven. The differentiator is the CFO’s ability to engage in solutions that generate more authoritative, timely data. By taking incremental steps toward achieving a higher quality, digital business environment, the CFO evolves the data literacy of the entire organization. If data is the driver for the CFO, then these insightful leaders need the highest value, most readily consumable fuel to propel the data agenda forward.ers