How Big Data Will Impact the Role of Management Controllers

ESSEC Profs. Florence CAVELIUS , Christoph Endenich, and Adrian Zicari explore how big data will have a potentially inspiring and meaningful impact on the job role of the management controller.

Nested within the Accounting & Management Control Department at ESSEC Business School, Profs. Florence Cavélius, Christoph Endenich, and Adrian Zicari are widely published academics whose research covers financial disclosure, integrated reporting, ethical management control systems, CSR and how sustainability can add value to firms.

Their research paper Bystanders or Change Makers? Where do management controllers fit in the digital world? provides the inspiration for a chapter in the recently published Routledge book Responsible Finance and Accounting: Performance and Profit for Better Business, Society and Planet.

The management control profession and the surge in data

Management controllers – and moreover management control systems –? may seem terms that are a little fuzzy for some of us, but their deployment in companies gives a clear edge to organisations seeking to measure resources and performance and optimise these to achieve greater efficiency. In the end run, they bring a wiser use of available resources and greater value to the firm.

In essence, a management controller requires data. And it is the surge in recent years of technology and subsequent amplification of information that provides the focus point of the researchers’ work and the potential changes this will have on the management control profession. ???

“Our research shows that management controllers, once they have mastered Big Data and new tools, can become actively involved in the digital transformation of their companies,” affirm Cavélius, Endenich and Zicari. But this doesn’t mean that management controllers should be locked into purely technical tasks such as data collection and data management.

?“Instead,” says Prof. Endenich, “they need to leverage the emerging data treasure to add value to their companies through tailored and data-driven recommendations for managerial decision-making.

In this light, the availability of new digital management tools that are simultaneously accessible for multiple corporate actors represents new opportunities to collaborate with different corporate functions and operational staff.

Big data means big responsibility

In the digital era, Big Data has become the new gold. An increasing number of firms want to transform their business models, and in doing so they face the challenge of transforming their management control systems. “In other words,” say the researchers, “such internal transformation becomes the backbone for a successful business model transformation.”

But running parallel to this is the question of the firm’s impact, and responsibility, on both its internal resources – employees – and its wider stakeholders such as suppliers, communities and indeed the environment. For Profs. Cavélius, Endenich and Zicari, as firms engage actively in Corporate Social Responsibility (CSR) strategies, it is important that they set specific and measurable CSR objectives and measure their performance against these objectives. “In this context,” asserts Prof. Cavélius, “Big Data mastered by management controllers can help to gather meaningful insights to manage social and responsible performance.”

Two ways the management controller’s role might change

“We hope to encourage even more management controllers taking an active role in the digital transformation of their companies,” says Prof. Endenich. He sees the profession being of particular help in building digital skills and networks across corporate silos, but also fostering a mindset open towards running pilots on digital initiatives, testing new software solutions and thinking out-of-the box.

?“We would also like to encourage multi-disciplinary teams,” adds Prof. Zicari. “These would blend skills from various areas to become more efficient in mastering the emerging masses of data and generate valuable insights from this data for managerial decision-making.”

If you can’t beat them, join them

The advent of big data and data analytics in recent years may have instilled a feeling of dread for some, and for others a further layer of complexity. But Profs. Cavélius, Endenich and Zicari remain optimistic, urging those in the profession not to feel overwhelmed by Big Data. As the saying goes, “if you cannot beat them, join them”.

Indeed, for the researchers, Big Data brings countless opportunities for those who embrace this new trend, enabling management controllers to build new skills around it and transform their work processes. “In this way,” they assert, “you can become an “augmented” professional, creating more value both for the organization and for yourself.”?

To boot, add Profs. Cavélius, Endenich and Zicari, the digital age significantly influences the profiles searched for in recruitment processes. In this context, knowledge and skills in the field of information systems become key for the next generation of management controllers challenging not only the companies but, moreover, the curricula for future management controllers at higher education institutions in France and beyond.

Big Data and technology in general will not make controllers redundant, but they will radically change the way controllers work. In this change process, management controllers can play an active role.

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