Why Data & Analytics always wins
Anders Liu-Lindberg
Leading advisor to senior Finance and FP&A leaders on creating impact through business partnering | Interim | VP Finance | Business Finance
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Data & Analytics teams drive significant ROI, help leaders understand their organizations in new and essential ways, and provide part of the toolkit required for the growth of a modern business.
They are also seen in some quarters as a 'rival' to the traditional Finance Function. But, as we're exploring in this series, there should be no confected competition between these two disciplines. Instead, they each bring specialisms and unique qualities. The ultimate goal is to harness the skills of each.
From data to insight
The crucial skill associated with Data & Analytics, and the thing that sets it apart from competing business processes, is the ability to translate data into useful insights. This is partly where the 'Analytics' part of D&A comes in. What is it that the data tells us, and how can we implement those learnings in a way that produces better outcomes? These are the key questions facing any Data & Analytics leader and the other stakeholders receiving the information they are gathering.
The data being gathered may not be 'conventional', at least not in the eyes of traditionally-trained Finance professionals. Rather than monitoring and reporting on a set range of KPIs and other metrics, Data & Analytics teams investigate and attempt to decode specific business problems through the gathering and interpretation of all sorts of different signals. Some of the data gathered may be qualitative, rather than quantitative, and much of it will be unfamiliar to Finance professionals. For example, Data & Analytics teams may work closely with Marketing and Sales functions to understand the sales cycle, Contact Centers to understand customer wait times, or Renewals teams to gain a deeper knowledge of customer attrition patterns.
Finance plays catch-up
We can already see the limitations of conventional Finance Functions when compared with Data & Analytics. While traditional Finance teams focus on P&L and other related, well-known metrics, Data & Analytics get to the heart of an organization in new and innovative ways.
There is a place for both. Clearly, it is crucially important that organizations know how much money is coming in, what their cash flow position is, and so on.
But Finance Functions can and should take a leaf out of the Data & Analytics playbook. In particular, we should guard against the siloing of the Finance Function by adopting the cross-functional approach that is characteristic of D&A. This means becoming familiar with a far wider range of information types and expanding our purview beyond the boundaries of traditional financial reporting.
This is also where business partnering comes in. As business partners our role is to translate information into insight, presenting it in a way that is understandable and digestible by all relevant stakeholders.
This requires us to have a holistic understanding of our organizations and to be able to spot patterns and opportunities across every process and function. By augmenting our existing Finance expertise with basic Data & Analytics competencies, we can drive significant new value for our organizations.
Does your company have a Data & Analytics team? If yes, how are they working together with or competing with the Finance Function to provide insight?
This was the fourth article in my latest series Finance vs. Data & Analytics. You can read the previous articles below.
While you await future articles why not read my latest series about ESG for finance professionals?
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Anders Liu-Lindberg ?is the co-founder and a partner at the?Business Partnering Institute ?and the owner of the largest?group dedicated to Finance Business Partnering ?on LinkedIn with more than 10,000 members. I have ten years of experience as a business partner at the global transport and logistics company?Maersk . I am the co-author of the book “Create Value as a Finance Business Partner ” and a?long-time Finance Blogger ?on LinkedIn with 100,000+ followers and 180,000+ subscribers to my blog. I am also an advisory board member at?Born Capital ?where I help identify and grow the next big thing in?#CFOTech . Finally, I'm a member of the board of directors at?PACE - Profitability Analytics Center of Excellence ?where I support the development of new analytics frameworks that can improve profitability in companies around the world.
Director of Financial Planning & Analysis at United Road Services
2 年Best article on Analytics and Finance I’ve read in a long time. Cheers Anders.
Finance | Accounting | Finance Controller | Project Finance Controller | Business Controller | Cost Controller | Revenue Controller | Credit Controller| Operations | Finance Business Partner
2 年Thank you for @ @
Senior Finance Manager | Expert in Accounting, Budgeting & Financial Reporting | Ensuring Financial Integrity
2 年Absolutely correct! ?? Data and analytics are the keys to success in any field. With data and analytics, one can make better decisions and achieve his/her goals. Data and analytics are the future of business.