Why CFOs should own Analytics

An interesting and relevant article for all FP&A functions, by Frank Friedman, CEO of Deloitte LLP:

 

In summary, “analytics can be a powerful tool to look ahead, helping answer such questions as:

  • What challenges will organisations face a few years out, and
  • what services might they need?
  • How should those services be priced?
  • What type of resources might be needed and where?
  • Where might the business be vulnerable if the data underlying certain assumptions change?”

 

Frank goes on to highlight that “the power of analytics depends heavily on several factors:

  • the quality and preciseness of the questions being asked;
  • the organisation’s ability to gather the data that can address those questions;
  • the integrity of the data gathered;
  • and the ability of users to draw insights from the data in an objective manner”

 

“Many CFOs area already using analytics to better understand where the business is strong and where it needs improvement, and how to allocate limited resources more effectively. Analytics empowers CFOs to exercise more centralised control of operational business decision making. As profit can fall between the operational cracks, analytics can be a game changer by leading to improved operational discipline.”

 

To read the full article, click here (it will open in a new browser).

How CFOs can own analytics

Deloitte has published an interesting ‘CFO Insights’ article titled “How CFOs Can Own Analytics”.

 

CFOs can strengthen ties throughout the business and expand influence outside core finance functions“.

 

CFOs should bridge the gap between strategic and operational decision making with analytics. That’s a fundamental change in roles: it’s the difference between “managing the business” – the big, upper level decisions, such as planning, budgeting, and forecasting, that are the CFO’s traditional responsibilities – and “running the business,” the day-to-day, or even minute-to-minute, operational decision making that typically resides outside the finance chief’s purview”.

 

“… the CFO can drive value outside finance’s core functions throughout the business”, including “procurement… business units … sales and marketing … supply chain … information technology…”, but  “…CFOs who want to lead analytics … have to show that they can deliver on the operational side“.

 

“Leading analytics to support operational decision-making demands a high-level commitment to shift the organisation from a historical perspective to a forward-looking perspective. It also requires a willingness to invest in a small group of talented people who can help you determine and implement the analytics capabilities you’re going to need.”

 

Click here to read the full Deloitte paper (opens in a new browser window).