CFO as a Big Data Analyst and Strategist
Today’s CFO role has evolved from the finance function to analysis and strategy. The CFO of this age is expected to be a strategic partner to the CEO. He can rely on data to see emerging trends and guide in making strategic plans for the business. With digital technology, the CFO has more data points to rely on. The CFO can glean vital analysis from Big Data if he has the skills to do so. Indeed, no CFO can ignore the importance of Big Data in risk management, performance assessment and situation modelling.
The CFO’s foremost task is ensuring the business remains financially sound. The conventional method of using relying on balance sheets, P&L statements and other financial documents can be augmented with Big Data. Using Big Data the CFO can analyse relationships between customer behaviour and revenues or losses. This analysis is useful in knowing which areas to expand and which to do away with.
As the part of the lead team identifying strategic areas of opportunity for a business, the CFO is trained to rely on data analysis to see market trends and shifts in customer behaviour. Big Data is can be relied on to help identify these patterns and make decisions based on them.
The role of a CFO today can also be seen as that of a Chief Strategy Officer. He is in the position to understand how best the business can deploy its resources to exploit the identified opportunities.
A business can use Big Data to stay ahead of the competition. The CFO can overlay the business’ data with other publicly freely available data from data sets in the industry. Data can also show anomalies which need looking into. These anomalies could represent opportunities.
As a strategic advisor to the CEO, the CFO has the task of moderating the expectations of the CEO using hard facts. The strategic vision can be charted out by relying on hard facts provided by data analysis.
As the risk manager in the business, the CFO can use Big Data to mitigate risk. This can be for internal as well as external risks. For example, the CFO can look at fraud attempts by correlating web searches made by employees on vacation spots and customer complaints on over-invoicing.
The CFO can strategically deploy Big Data for situational modelling in working out business position scenarios in the future. By predicting risky situations, the CFO can help chart a strategic path that is less risky.
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