The role of corporate CFOs is beginning to extend beyond the realms of traditional financial management, into more strategic areas of the business. This increased responsibility makes it even more important for these executives to have access to meaningful data, in order to facilitate the decision-making process. But the results of a recent survey found that almost half of all CFOs felt that this process was hampered by inaccurate data and information overload.
A recent survey conducted by The Economist Intelligence Unit surveyed 100 CFOs/ finance directors from the Asia-Pacific region. The respondents came from a range of geographies, industries and company sizes in order to present a broad reflection of the challenges faced by these individuals worldwide.
The research report, entitled How the new breed of CFO makes decisions looks at the evolving role of CFOs in modern businesses, and how data is being utilised within these positions.
In this age of big data, having access to increasing volumes of information can be seen as a double-edged sword for many businesses. This is because an increased volume of data does not necessarily guarantee greater insight, and for many CFOs, the decision-making process has actually been slowed down.
But what exactly is it that is slowing CFOs down?
In this article we explore some of the biggest challenges faced by these business leaders and explore how these problems can be overcome.
What’s slowing CFOs down?
CFOs clearly recognise the importance of data analytics for their job function, but this report suggests that in many organisations, decision-making is being constrained by numerous data challenges.
These obstacles include exposure to inaccurate and inconsistent data, with 52% of respondents listing ‘data accuracy’ as a major hindrance to them carrying out their duties effectively.
This is closely followed by poor access to timely insights, with 46% of respondents raising awareness of problems this can cause.
Integrating complex data from disparate sources was also seen as a common concern for CFOs, with 43% of those surveyed considering it to be a significant hindrance in carrying out their duties. For many businesses, data is tied up in multiple sources – CRMs, ERP systems and even Excel spreadsheets. This data comes in all shapes, sizes and formats, and bringing it all together in order to achieve a single version of the truth is often a difficult task.
What improvements can be made?
For many organisations, the analytics tools they are currently using simply do not fit the bill. With traditional business intelligence software, data is tied up in complex systems and only a select few individuals in the company have the expertise to do anything meaningful with this information.
The complexity of traditional BI tools was highlighted in the CFO survey, with executives seeing easier to use tools as the way forward. 62% of respondents agreed that these easier to use applications would help to increase the adoption of business intelligence across the organisation.
Interestingly, a large number of respondents placed the blame for these complex systems with It vendors, suggesting that improvements must be made in order to make these tools more accessible and user friendly.
44% of CFOs agreed that IT vendors make data analytics difficult.
The solution to this problem therefore, may come in the shape of easier to use business intelligence tools. This can already be seen in the clear shift towards self-service business intelligence applications and industry research organisation, Gartner, believe this trend is set to continue. By 2017 Gartner predicts that the majority of business users and analysts will have access to self-service BI.
In terms of solving the problems associated with disparate data sources, CFOs believed that even incremental changes could have a significant effect on the level of insights they could achieve.
Connecting multiple data sources, ideally through the use of a centralised data warehouse, can allow CFOs to report over data with a much firmer belief in its accuracy and validity. This will allow them to achieve a single version of the truth and mean they can make key decisions based around facts rather than fiction.
The ongoing importance of data analytics
Although many CFOs see problems with current data analytics tools, it is clear from the survey that they recognise the role data analysis has to play in the future of their businesses. With this in mind they are committed to implementing improved measures around this process.
The results of this survey show CFOs recognise both the short- and long-term benefits of data analytics.
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