In today’s rapidly changing business landscape, CFOs wear different hats in a typical company. One of the roles of the modern CFO is to be a catalyst for change among the members of the C-suite by making data-driven decisions.
In particular, it is the CFO’s responsibility to bring together seemingly disparate pieces of information from various units such as the IT department, sales, and operations, and utilize this information to optimize business performance.
Data-Driven Decision Making and CFOs
With the ubiquity of Internet of Things, machine learning, cloud computing, and other technologies dominating the tech and finance world, today’s decision makers are now faced with increasing pressure to effectively glean useful information from the mountains of data generated by their organization.
How Do We Leverage These Insights?
Now more than ever, data analysis and decision making have become indispensable in the CFO’s toolkit. Nevertheless, not all CFOs are equipped to break down and analyze the available data and convert it into useful insights that can inform their company’s growth strategy.
The first step to making an organization’s data useful for decision makers is to collate the data and transform it into a format that is more usable. If information is stored across different systems, it’s important to find a way to integrate these in order to get ta holistic vide of your business performance. Some platforms provide consolidation support to achieve this.
The next step is to formulate actionable insights, for which you would need a suite of tools or a sophisticated financial system that is able to interpret huge data sets. Investing in such a system would allow your CFO to get real-time access to business numbers, allowing them to be able to respond to and address opportunities to increase efficiencies and reduce cost in a timely manner.
As a result, data analytics can directly impact your bottom-line in a number of ways, such as in enhancing vendor/ supply management, optimizing customer profitability, improving the flow of products, and optimizing asset productivity, among others.
Essentially, data analytics enable CFOs to get a deeper understanding of the metrics that drive their business. As they get a better handle of it, they get more opportunities to improve business outcomes.
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