The realm of “visibility” is a complicated one for many enterprises as they attempt to drive a full picture of various aspects of their respective organizations. The pressure of business development and ultimate corporate growth will also sometimes stand in the way of enhancing internal visibility, as most Chief Financial Officers (CFOs) will find their time best served on the front lines of the contemporary enterprise instead of funneling through the dregs of uncleansed, unclassified enterprise data.
However, that very word, “data,” is one that elicits a wide range of responses from CFOs and related roles within any given enterprise. What does data actually mean in terms of value? In terms of true corporate impact? And, most of all, what does “Big Data” mean for the contemporary CFO?
As stated here on CPO Rising previously, Big Data isn’t just another business fad that will eventually fade away or die out; unlike other once-hot business strategies, Big Data (a phrase which also envelops analytics, data reporting, and business intelligence in its definition) is a concept that will continue to permeate throughout a wide range of business functions as more and more enterprises place an increasing emphasis on the value of visibility.
Within the financial realm, analytical tools represent, at the core, a greater means of driving visibility into monetary attributes. This is of course a critical component of any CFO’s daily array of responsibilities, which includes providing financial visibility to the executive board and, ultimately, the CEO or President of the enterprise.
Big Data initiatives, however, can dive much deeper than financials and similar information. Contemporary tools for analytics can uncover key patterns and trends that will drive true intelligence…not just simple data. For the CFO, Big Data is:
- A way to understand how finances truly sit across other key functions. While the CFO can easily tap into companywide finances from existing finance or payables systems, deeper-dive analytics and BI platforms can uncover “hidden truths” regarding spending (particularly off-contract or off-program spending) within other key enterprise functions. How is marketing utilizing company finances to improve the company brand? What are the cost ramifications of freelancers and independent contractors?
- Procurement’s true impact on the greater organization. This point could be moot if spend analytics are involved on the procurement side of the house; however, if finance is leading the Big Data charge, it can be simple to analyze how procurement is positively impacting the greater organization via consolidated spending (i.e. supplier optimization efforts) or discounts / favorable terms with key suppliers.
- Potential risk areas that may go unnoticed. Procurement contract compliance is one major issue that can plague any organization, regardless of size or scope. Beyond off-contract spending, there are multiple areas that present risk to the greater organization. A union between the CFO and its analytical team or system will uncover other potential risk areas, such as services or contractors paid by the enterprise that not only fall outside of a larger contingent workforce management, but also may present labor compliance risks.
The three areas above are just a few of many key areas that Big Data strategies can impact within the greater purview of the CFO. As analytical and reporting strategies (and accompanying solutions) become more of an enterprise imperative, the CFO and other key roles across the enterprise will surely benefit beyond mere visibility.