CFO TALK: The Analytics Business Partner with Jesper Hybholt Sorensen

As the role of the CFO evolves (see Managing Job Creep in the CFO Role), ?the roles in their team are also evolving.?? In the past 20 years a key position bridging corporate finance and business operations has been the Finance Business Partner.??? That role is also evolving.??

Jesper Hybholt Sorensen , a CFO with deep roots in data and analytics, including being a partner in the Finance Analytics Institute, joined CFO Talk to discuss this evolution.????

In the episode Jesper explains why and how the Analytics Business Partner is reshaping the traditional finance landscape. Building upon the established finance business partner model, the analytics business partner represents a natural and necessary progression in the finance discipline; combining advanced analytical capabilities with strategic foresight. This evolution not only leverages data to drive decision-making but also integrates a balance of soft and hard skills to influence and guide companies toward a future grounded in actionable insights.

This role is pivotal in moving beyond retrospective financial analysis to proactive strategy formulation, marking a significant milestone in the journey of finance professionals.

The role of the Analytics Business Partner (ABP):

Merging soft skills with advanced analytics capabilities plays a critical role in shaping strategic decisions and influencing the future of the company.? To achieve these objectives the ABP must do a number of things very well.?? Create valuable insights that will alter decision making, effectively communicate those insights, collaborate to leverage the insights and possess the business acumen to ground our insights on critical business needs; combine hard and soft skills.?

So really the analytics business partner is where we're using not only our soft skills but also our hard skills to influence decisions and impact the strategic direction for the company. - Jesper Sorensen

Jesper pinpoints the tools used to automate visualization as key enablers in advancing the ABP role.? ?He also draws a clear line between data visualization and analytics tools, teaching that knowing the difference will put us in better position to solve problems and accelerate growth through insights and foresights.?

The journey from Visualization to Advanced Analytics: ?

The progression from basic visualizations to predictive and AI-enabled analytics explains why mastering the tools beyond simple visualization is essential for deeper insights that drive data-driven decision making.

“Data visualization is about charting and dashboarding, a most valuable capability to bring information to what has happened, i.e. hindsight information. Analytics uses mathematics, statistics and Artificial Intelligence (AI) to reveal unbiased insight about the current environment and predictions about what has a probability to happen. As such, visualization looks at the past, and analytics yields insights of the current and foresight about the future. These tools are valuable individually and symbiotically together. It’s not one or the other, or one before the other. Each has a value to bring in the business landscape” - Jesper Sorensen

For more on this distinction read Jesper and Robert J. Zwerling, P.E. 's 3 part series, Visualization vs. Analytics.

Building an Analytics-Driven Culture:

Jesper's advises CFOs to champion analytics within their organizations by aligning mindset, skills, tools, and data governance to foster an environment of informed decision-making.

He implores C FOs to find and Analytics Champion (or 2 or 3 ),? someone who leans into using analytics to generate this insight and foresight that drive business decisions.?? This role requires as much curiosity as it does analytics capability. ??But as soon as their insights start shaping decisions, the flywheel building your analytics-driven culture gains momentum.??

“You need to find that Analytics Champion or the Analytics Champions in your company who can do this and show that to the business, so others in the business can see that we're generating value from using data [and develop our analytics-driven culture]” - Jesper Sorenson??

Another data and analytics expert, Prashanth H Southekal, PhD, MBA , shares more about building an analytics culture in his piece, ?Driving Customer Intimacy with Data and Analytics. ?By following the three steps in the article business leaders will leverage D&A to measure and improve customer intimacy. This will enable the enterprise to become more competitive and improve the odds of enhancing customer profitability for long-term growth.

Accelerating the Adoption of the Analytics Business Partner:

?Previously, Jesper told us the adoption of the ABP, a role that seems so obvious as a logical role in the evolution of finance, was painstakingly slow.?? He attributes this slow adoption to the lack of clarity of the tools and techniques - the analytics toolbox - that should be used to solve the issues being addressed.?? Jesper describes it like this,

“I have a problem that I want to solve, but what is the technique I need to solve it? It could be predictive analytics. Okay, if it's predictive analytics, then you need the tool that can help you with predictive analytics. If it's AI enabled analytics using big data, then you need a tool that can do that. If it's a Monte Carlo simulation, then you need a tool that can run a Monte Carlo simulation. So, it's not just one tool necessarily. It could be one tool, but it comes from the technique and the problem that you want to solve.? This is where we're using our mindset. Frequently we are modeling the future and a lot of the time we are super biased in how we do this. There are a lot of factors, and we change them. But what you could do instead is use predictive analytics to determine what those factors will be in the future. But in combination with that, you could also use Monte Carlo simulation to guide you on a high case and a low case. And by doing this you need a tool. ?This is why it's not just buy a tool, it's start with what is my problem and what is the technique I am going to use to solve that problem. And then you can figure out what is the right tool and technique to use.? Here is where many organizations are challenged because they often believe the tool that can solve our issues is a visualization tool. Because we believe that's an analytics tool. Visualization tool is what visualization tools are. It's visualization tools. Exactly what it's saying that it is, not an analytics tool.

Advanced analytics is when you find the insight and the foresight in the data, which is unbiased because you don't provide any input to it. You just let the algorithms in the system decide what the future should look like. And then of course, when you do this, it's not just about taking a decision based on that. You also need to take the decision based on what is the business telling you, what do you know about the business? So don't be blind about taking decisions just from data. You need to have that soft skill set as well, where you understand the business, you collaborate with the business, and you have a lot of communication going back and forth with the business. That's, again, coming back to where we started with the hard and soft skills.”? ?

Building capabilities in an asymmetric manner can lead your organization or team to failure. Use CFO.University's People, Process & Systems Assessment to maintain symmetry and balance in your team's development.

4 Steps CFOs Can Take to Create an Analytics Driven Culture.

1.????? Mindset.? This is the start button. You have to grow a mindset that wants to use analytics to tell the business something insightful, actionable and impactful.

2.????? People.? ?The right people. If you don't have people who can do analytics, it doesn't matter.

3.????? Process. ?Here we're talking about two things related to data governance.? If you don't have the data, it doesn't matter. If your data is horrible, you can't do it either.

4.????? System.? ?You must have a system that captures the data you need in a way you can process it.??

So, mindset, people, process and system.? It's the lowest of these four that define your level of analytic intelligence. Investment in one will be wasted if the proper investment to any of the others is not kept up.?? ?

Jesper reminds CFOs they don’t need to do this alone. If the steps above look daunting, ?

"… take the opportunity to outsource this where you have the people and the system sitting on the other end. You pay of course for that. Or you could buy a boutique tool that is very helpful, doesn't cost a lot, but is really, really good and maybe even better than some of these big enterprise systems to do advanced analytics." - Jesper Sorensen

Enjoy the journey building the Analytics Business Partner role and culture in your organization.?

For more on building World Class Strategic Partnering tap into Jesper and Robert’s series, From Average to World Class – Next Generation Finance

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