Few internal departments can claim a greater need for analytics and data-driven insights than finance.
High-performing finance departments act as a hub of insight that helps inform both strategic and operational decisions. However, to support an enhanced data-driven methodology, finance leaders need timely access to disparate data sources across the organization, as well as an elevated analytical mindset.
Moreover, a recent Aberdeen Group survey of more than 300 finance executives finds that today’s CFO organizations face ongoing pressure to reduce the cost of finance amidst a recovering, but still volatile economy. Not only that, these companies must do this while more effectively wielding financial data and insight, helping senior management pursue revenue growth.
According to the survey, these finance executives are most likely to turn to analytics to improve operational efficiency, or to grow. Both efforts could be impacted by data-driven insight (Figure 1).
Figure 1: What Drives Analytics in the Finance Department?
If you follow the general value chain of analytics, you see companies get more efficient at collecting and ingesting more data. By doing so, they are enriching more of their decisions with relevant insight and uncovering more opportunities. Cost reductions, process waste removal, customer cross sell and upsell, and new product deliveries are just some of the activities that can be augmented with effective analytics.
Today’s finance executives recognize this important connection between data and execution. Companies want to exploit the value of analytics to generate more opportunities for efficiency — with budget cuts being a catalyst for cost reductions and greater operational improvement. Additionally, these businesses see an almost equal pressure to expand, and the findings demonstrate the increasing importance of analytics as a component in those growth strategies.
To learn more, check out the full report, Data-Driven Finance and the Analytical Edge.