Big Data and analytics are now part of almost every finance function in the world. This may not be a direct result of implementing a new system at the company, but regardless, it will have an impact on them.
This could be anything from the thoroughness and speed in which audits can be undertaken through to how investments and risk are assessed and everything in between.
In the coming years finance departments are likely to be more directly involved with Big Data as the merits of its use become more relevant to those working in the finance division.
So what do companies and finance divisions need to do in order to prepare themselves for this transition?
Firstly, and most importantly, it is vital to remember that data itself changes nothing. Data allows people to see what has happened, what is happening and what could happen. The key to making sure that this has an impact is through allowing the finance department to be flexible.
Having a system in place that allows the department to make quick changes without affecting the stability and performance of the department is key. This is essentially a change in the ways that the finance division works, but is a catalyst for the success of a data programme.
In order for this to work effectively there also needs to be an understanding of data from those within the department. The finance team are generally working in the area because they have an effective grasp on numbers, which many believe puts them in a strong position when dealing with data.
However, when dealing with millions of data points and entries, much of the analysis will be through the use of visualizations, something that needs additional understanding and almost an an entirely new mindset. This needs to be taught and understood by each member of any finance team in order to make the most of the data available.
Generally speaking, finance tends to be a very structured discipline. This is simply because the ultimate goal is accuracy, meaning that processes and actions need to be established and understood in order for them to work properly. Big Data often requires the opposite, the idea of it being to find out new processes and ideas.
In order for the data to work properly for you, in any discipline, the most important aspect is asking it the right questions. To find out which questions are the best is not a case of knowing exactly what needs to be asked first time, but instead to experiment until the correct question is being asked in the correct way.
Ultimately, Big Data will herald a huge change in the way that finance departments work and it could become one of the most important ways in which Big Data is used in the next few years. How companies and divisions react to this is going to be the key to making sure that it is a success in the long run.