CFOs and finance teams play an increasing role in enterprise innovation, and the ones with a solid foundation of enterprise technologies are already ahead of the competition. Most companies view innovation as essential to survival. But without the right leadership and direction from finance, enterprise innovation plans inevitably fall flat or divert precious resources away from worthy projects. Supporting innovation is one of the new challenges for finance, but one that is important for CFOs and their finance teams to get right.
Customers don’t care about your infrastructure or data problems. They just want your organization to know who they are, what they ordered and how to fix their problems. At the same time, businesses want technology to help build great customer experiences while driving to a lower cost structure and making the products they build better using the data they have. And they need it done fast. These companies have spent millions of dollars trying to modernize their applications, only to still lack real-time access to the data they need. A fundamentally different approach is required to solve the challenges created over the last 30 years and not solved in the last five.
According to Gartner, just three types of financial decision-making mistakes can cost businesses around 3% of their net profit. Operational decisions are increasing in speed, volume and complexity — creating a challenge for finance, whose job it is to make sure those decisions are financially sound. Many finance teams have invested in different tools and technologies to improve their decision-making capabilities, however, few are successful at consistently supporting business decisions in a way that delivers tangible business value. To change this, finance leaders must stop making the following profit killing mistakes: confusing a desired outcome with the likely outcome, overlooking a decision’s effects on other parts of the company, and having an “any business is good business” mindset.
Advanced analytics enable businesses to gain insight from data and to better perform in fiercely competitive markets. Most companies today see advanced analytics as the key to drive down costs, improve decision making, and increase customer value. But the challenges of a data analytics implementation can hinder these plans. A business looking to develop advanced analytical capabilities and become data-driven must have the right tools, culture, data, and people to support managerial decision making throughout the use of analytical technologies. Implementing analytics shouldn’t be viewed as “just another IT project.” It’s a fundamental change in the way that organizations do business.