Chief Financial Officers (CFOs) have access to terabytes of data that their companies generate each day, giving them the opportunity to lead the pack in terms of using analytics-based insights to help drive profitable growth. According to Accenture Strategy research, finance leaders globally are aware of this potential, with 63 percent of CFOs believing that they are best positioned in the race toward using data and analytics to drive higher returns on investment.
Many CFOs are gearing up for action. Based on a 2018 survey of finance executives of companies above $1 billion in revenues, 40 percent of CFOs have already invested in advanced analytics, and 46 percent have invested in master data management. Eighty percent of CFOs plan to be using both sets of tools in the next two to three years. But winning with analytics is not just about the technologies. It’s also about foundational qualities: developing a data-driven mindset, building analytics capabilities, establishing processes and later shifting to an analytics-supported operating model.
This “foundational training period” can be daunting for organizations that are reluctant to engage in yet another years-long project. But in an era when innovation cycles are getting shorter, who says you should wait ages to generate value? Build up your strength and get out of the starting blocks now. Accenture Strategy recommends an approach that captures value from quick wins and reinvests a part of those savings into the longer-term initiatives required to create sustainable competitive advantage.
Get your training regimen in place
Before committing to the whole long-distance event, get your training regimen in place and show the value potential to your organization. Start by clustering use cases in a “complexity” vs. “value-added” matrix based on your strategic priorities. (See figure below.) This will help you identify quick-win pilots that you can kick off immediately by leveraging external providers and loading your data, structured or not, into a data lake. Deliver results within short cycles of 10 to 14 weeks. Track how you’re doing and use metrics so you know how well you’re progressing.
Identify quick-win pilots to advance your company in the analytics race
Take the example of Accenture Strategy’s work with a global staffing firm. Socio-demographic information, unstructured competitor data and internal data were compiled by teams of data scientists and strategists to develop a brand-new, data-driven branch strategy in Germany. In close collaboration with the finance organization as primary data supplier, the project was delivered in four cycles of one month each, revealing new value pockets with each iteration. Progressively, insights on ideal size, location and business impact of each branch were included in a three-year business plan covering costs and revenues.
Work those foundational muscles
Once the first pilots deliver value, the momentum is on your side. Use it to scale analytics at speed. However, don’t forget to invest in the strategic initiatives that are required to become a mature, data-driven company in the long run. Master data models and data governance are typically longer-term projects that will enable more use cases over time and reduce the effort to build each case.
In addition, start recruiting the talent that you will need to continue driving analytics in your company. Building capabilities with the right skills will be instrumental to filling your pipeline with more use cases and to delivering more complex projects successfully. Having an analytics-capable workforce will help across an organization’s innovation objectives. According to our research, 82 percent of executives believe that the skills required and how they source talent will evolve, too.
Find a good trainer
CFOs that accelerate their move to data-driven decision making stand to gain a competitive advantage. According to Accenture Strategy research, 50 percent of executives said that using data and analytics to better serve customers is one of the top ecosystem trends over the next three years. Tapping into these ecosystems of partners with specific skills and capabilities will be crucial to success.
Experts can help you identify, map and select the use cases, and as-a-service solutions can help you scale up rapidly, whether you plan to build your own infrastructure in the long run or not.
Once you have the feeling that your organization is ready to run on its own, you can have a look at your sourcing model and decide to build an internal Analytics Center of Excellence, or you can continue to leverage external solutions.
Just be sure you don’t have to look at competitors ahead of you some day and wonder why you didn’t start earlier.
In one byte
Chief Financial Officers are best positioned to lead their companies to victory by using the information they collect internally and externally to generate insights and support informed decision-making, leveraging artificial intelligence, as well as descriptive and predictive analytics. The winners will be those who see the work ahead as a series of sprints. Pilot first, transform second and generate value along the entire way!