Business intelligence has been in use across various organizations now, and it’s vital for C-suites within a company. Chief Finance Officers (CFO) everywhere need BI to work with other C-level organization members for customer success operations.
For CFOs, business intelligence provides an avenue for organization growth, better return on investment, and increased competitive advantage. Let’s look at why CFOs need BI and how it helps drive better decision-making.
Business Intelligence: Helps Discover Better Insights From Data
With billions of data points generated daily, it’s hard for companies to find value in such large amounts of data. To cater to that, businesses must transform their data into insights. That’s where data analytics enters the picture.
Business Intelligence (BI) allows the CFO and the organization to see data from different perspectives. For example, it can show how new product features are being used, which employees are performing poorly, and which marketing campaigns are yielding returns.
This data can help guide the company’s strategies, reduce variable costs, improve customer experience and retention, and improve organizational communication. The CFO can tap into the wealth of information that reveals business trends and opportunities.
Data Offers A Deeper Understanding Of Organizational Performance
As the head of finance and accounting, CFOs have a lot on their plate. With finance being a data-driven function, the chief financial officer must utilize data for decision-making. Many decisions in large companies will be informed by analytics and big data by 2020.
To keep up with the growing demands of their business, the CFO has to ensure that their internal processes are optimized. For instance, streamlining the procurement process can give the company an edge over competitors.
Maintaining proper visibility over all the assets and resources is also essential. With a good grasp of all the processes, the treasurer can ensure that the company has all the resources it needs. Also, they can track performance and help other departments within the company.
With access to analytics, CFOs can see where the company is heading. With it, they can spot problems much faster and address them promptly.
Provides A Simple Way Of Analyzing Financial And Operational Measures
As every company knows, it isn’t easy to analyze all the financial information. Every department has a particular set of measures from which it needs to monitor its performance. Keeping track of all this data can be difficult as everyone uses different software.
However, with a robust platform, the chief financial officer can analyze all the data that cuts across all departments. This makes it easy for them to understand the entire organization’s performance and take action.
Compared to paper-based reporting, data analytics allows management to identify trends and changes in how business is conducted quickly.
Monitor Metrics And Key Performance Indicators
While organizations need to track all metrics, doing so can be quite challenging. Monitoring key performance indicators (KPIs) for accounting and finance teams is their most important job.
With robust technology, they can define specific KPI points and monitor them in real time, making it easier to find which areas need improvement.
The finance team can monitor KPIs such as revenue and profitability with statistical and data visualization tools. With the metrics in place, the businesses can track performance, which helps in measuring the company’s strengths and weaknesses.
With regular predictions, the management team can determine the areas that can be improved. These could include product pricing, sales, customer retention, and employee satisfaction.
Predict Future Trends
Forecasting is an essential tool for management and investors in the ever-changing business environment. It helps them gauge the direction of the market and plan accordingly. Business intelligence tools allow CFOs to explore different scenarios and predict what may happen in the future.
The CFO can analyze the data with business intelligence and predict where the company is headed. For starters, they can predict the future demand for products. They can then alter their strategy to suit the market.
Predictive information makes it easier for the leadership team to understand the market. They can then take informed decisions and plan for expected outcomes. Analytical models help management make long-term business decisions and scale according to trends.
Enable Efficient, Effective Decision Making
With a plethora of data available, the Chief Financial Officer must make decisions based on that data. With excellent analytical capabilities, they can make the right decisions. With business intelligence, the executives can make educated decisions that allow resource allocation to the right places at the right time.
With predictive analytics, decision-makers can forecast how the market is likely to evolve. They can then formulate a strategic plan to best use those projections.
Recommend Solutions To Underlying Problems
To meet customer demand, businesses have to devise new solutions to a multitude of problems. With the right business intelligence, the CFO can uncover underlying issues that cause poor performance and devise ways to resolve them.
With detailed reports, the business leaders can identify the areas causing hindrances to growth. Resolving these issues with BI allows teams to complete tasks faster and more efficiently. Employee productivity can increase, and analytics can minimize human errors.
With real-time data, stakeholders can perform agile decision-making rather than waiting for deep dives and data generation for current metrics. They can recommend solutions to underlying issues, and by focusing on problem areas, the business can improve its processes and become more profitable.
Improve The Overall Bottom Line
With the help of a well-designed dashboard, business executives can get real-time information on the organization’s financial health. The dashboards allow them to keep track of all departmental performance metrics and provide them with solutions.
Accurate and timely financial reporting allows management to allocate budgets to the right people and ensure that cash flows are healthy. With the ability to streamline operational and financial performance, CFOs can keep a close watch on the firm’s financial condition. They can then take appropriate actions such as reducing costs, increasing revenues, and acquiring new customers.
The Bottom Line
The benefits of having a strong, integrated, and innovative business intelligence for CFOs provide several advantages. BI helps businesses run data-driven decision-making processes, and it is essential for C-suite executives, especially the CFO, to embrace these innovations.
Business intelligence allows stakeholders to make better decisions and improve their bottom line. Take advantage of the BI you can generate and maximize opportunities to help business scalability.