Four data analysis trends your chief financial officer should know aboutEmma
The internet of everything. DevOps. The rise of ‘extreme architectures’.
No, we’re not describing the most popular online game at the moment, we’re talking about something that should concern your chief financial officer and much of your senior staff: data analysis.
Today’s chief financial officer not only needs to be versed in the latest finance laws and software, he or she also needs to be a master of analytics. According to the IDC Digital Universe study, the world’s data will double every two years. As someone who will use your company’s financial data to compile reports about the past and plan strategically for the future, the more your chief financial officer understands about data analysis, the better.
Here are four data analysis trends that your CFO should know in order to harness and examine and use data in a powerful way.
- The increasing importance of systems management. The world is at the point where we have so much data at our finger tips that businesses battle to harness it meaningfully.
Deepak Kumar, founder of IT systems management solutions provider Adaptiva, predicts that in the next year, “integration of big data analytics solutions will continue to fall short, leaving perishable business insights undiscovered in disconnected silos of data.” Efficient systems management is the only way to ‘connect the dots’ – connect the isolated mountains of information in a way that will make them meaningful for your business. The better your chief financial officer can manage data analysis systems, the better he or she will be able to use information efficiently.
- Big data gets speedy. Analysts predict that in the next year, big data analysis will get faster than ever before. The speed at which data is processed largely dictates the speed at which decisions can be made. The implication for your chief financial officer is that he or she will be expected to make decisions faster than ever before. She should be able to analyse history and dictate trends more accurately too.
- Algorithms will enter the boardroom. “Algorithms heat up in the data ingest,” says Dan Graham, GM at Teradata. “As a result, CEOs and investors will start talking deep analytics as core business goals.”
Your chief financial officer should understand that the better your business can analyse data, the more it will be worth. He or she needs to invest in the right skills, systems and processes to get this right now. Doing so will place your company at a competitive advantage for the future.
- Chief financial officers need to understand which data is required to achieve your company’s goals, who needs it and how often. Knowing that “big data analysis is the way of the future” can sometimes cause companies to spend unscrupulously and aimlessly on things like software and storage space. Your chief financial officer should help to focus your decisions around data analysis.
Paul Garel-Jones at Computer Weekly makes the following insightful comment: “Much of the current debate around big data is locked in technological advancements. This misses the point that the real strategic value in the data is the insight it can give into what will happen in the future,” says Garel-Jones.
“Predicting how customers and competitors’ customers will behave and how that behaviour will change is critical to tailoring and pricing products. Big data should be about changing the way you do business to harness the real value in your data, re-shape the interaction with the market and increase the lifetime value of your customers. Therefore, which data is required to achieve these objectives, who needs it and how often are key pieces of the big data puzzle.”
If the world of data analysis seems overwhelming or foreign, contact The Finance Team. One of our finance specialists can assist your company put useful, usable processes in place.