In some kinds of more traditional businesses the finance department tends to swallow as much data as is thrown at it but only outputs small, measured and curated amounts of insights periodically: “Here’s revenue vs target in the last quarter”. These are undoubtedly essential for proper business management, but periodic reports also mean it can be too late for the business to respond. It’s like driving by looking only in the rear-view mirror. Looking at what’s behind isn’t going to let you spot a sudden bend in the road! Essentially, the highly competitive and evolved business environment of today requires businesses to have proactive, indicative business metrics. Combined with more traditional metrics, these mean businesses have invaluable and complete insight in order to evaluate performance. Proactive, indicative business metrics are found across most successful businesses–and especially amongst C-suite employees. These people know that the benefits are proven. Analytics-driven executives achieve 86% greater year-over-year increases in operating profit, 32% greater financial budgeting accuracy and 2x greater year-over-year growth in operating cash flow*.
Data will talk if you’re prepared to ask the right questions. And if your competitors are making best use of this kind of deep dive into granular insights–and they almost certainly are–then you simply have no choice but to match their speed. The situation is sometimes compared to an analytics arms race where the quality, breadth and underlying intelligence of metrics used in a business is as accurate an indicator of its success as cash flow or overall profit. Businesses who aren’t using proactive insights to drive their strategy and operations need to rethink their approach to how they use the information they gather and hold. The finance department needs the courage to say that, actually, the way things are done right now is not good enough. And ultimately, the finance department needs to take a fresh insight-driven approach out into the wider business so it can inform decision-making.