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Today, chief executive officers increasingly look to their finance chiefs for insights on where to invest in new initiatives that can boost top-line and bottom-line growth.
Yes, the chief financial officers are now more analytically focused on understanding and influencing profitability across multiple dimensions, from customers and products to geographies and sales channels.
Though CFOs are clearly focused on understanding the drivers of profitability, there are many barriers in the journey to establish a data-driven finance culture. Exploding data volumes from both structured sources such as enterprise resource planning systems and unstructured big data generated from numerous channels threaten to overwhelm the analytical capabilities of legacy finance systems and traditional financial analysts.
We recommend the following best practices as foundational strategies to better understand profitability drivers within your organization:
Establish a common finance language across the enterprise based on common systems, data and processes that allows management and line of business executives to reference the same data for analysis and decision making.
Strengthen the partnership between finance and the business leadership by embedding finance professionals into the lines of business to help interpret the numbers efficiently, analyze profitability measures effectively and uncover new growth opportunities faster.
Create centers of excellence to provide leadership, best practices, research, support and training so that organizations can centralize requirements and pursue excellence in a particular area, from sales and marketing to business analytics.
Read the complete article to know how organizations can embed a data-driven culture.
Access the complete 5 Minutes on Modern Finance Best Practices Series.
May 19, 2014
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