Information Inaction: Best Practices for Translating Data into Better Business Support
Given the intensely competitive business environment, there’s only one strategy that companies can count on—and it’s one that tends to make finance executives uneasy: innovation.
Not that innovation comes only in the form of paradigm-changing breakthroughs or cutting-edge discoveries. What businesses need now is to continuously apply innovation in many forms, from remaking business processes to enhancing product quality to identifying new applications for existing products, services, or technologies. Such innovations won’t catapult a company into the ranks of Apple or Google, but they should help a company upend is rivals, both current and prospective. For CFOs, it’s the kind of targeted innovation for which they can calculate a payoff, or at least apply disciplined limits on spending.
But the relentless pace at which innovation needs to proceed puts the finance function at the forefront, using analytics technology to mine mountains of data for relevant insights. The key to sustaining profitable growth, however, is for finance to analyze financial and performance data at a consistently speedy pace, informing faster and more insightful management decisions. And that’s in an environment where, surveys have shown, most finance functions can satisfy requests for analysis in one day or less. That said, decision makers are understandably in a “Can you get it to me yesterday?” mode, trying to obtain, absorb, and analyze information-driven insights as quickly as possible, making the necessary judgments to sharpen their company’s competitive edge.
Here are some steps smart companies take to meet those ambitious goals:
1. Make technology spending a priority. To meet the targets they have for profitable growth, companies need to upgrade their information systems, especially in the area of improved reporting and enhanced data-visualization capabilities. Line-of-business managers that must make decisions based on data need to understand what it is telling them.
2. Improve ease of use of information systems. Self-service systems, where managers can access the financial and performance data they need without help from finance or IT, are a step in the right direction. But having data isn’t the same as understanding it well enough to make smarter decisions. With the volume and complexity of data on a never-ending upwards spiral, companies need to optimize their systems so that users can put the information to good use.
3. Tighten collaborative bonds. The best data-disseminating technology in the world can’t compensate for users who don’t know how to interact with it. In some companies, this imperative translates into making sure that members of the finance staff work closely with line managers to analyze data and develop it to the point where it can be used to support decision making. Developing tighter bonds, and collaborating more effectively, will ultimately turbo-charge the quality of the analytical dimension. In a hyper-competitive environment, the finance function needs to act as an enabler, guiding the company in the right strategic direction and showing the path to innovation and growth. By effectively employing cloud, mobile, and analytics tools, finance executives can lead the way to profitable outcomes.