Some weeks ago Samuel Dergel, Executive Search Consultant and author of “Guide To CFO Success” posted a story proposing a new name added to the executive table – Chief Analytics Officer or CAO, and stating that since Finance had not managed Big Data and Advanced Analytics well it should be taken off the
First of all I don’t think Finance has failed, however Finance has not succeeded either. The function is developing rapidly as with everything else in society. Transactional tasks are being offshored / outsourced and large scale ERP systems are eliminating, automating and digitizing tasks at a pace never seen before. On the other hand, the amounts of data available to companies has increased exponentially and still does, yet few companies know what to really do with all this data. Typically it falls between the IT and Finance organizations, yet neither of those functions have really managed to make the data work for the business. IT lacks business savviness whereas Finance has fought to gain this yet failed to get people that are equally strong at analysing data. In general both disciplines (business finance and advanced analytics) are two very different things, where one requires generalists and the other specialists.
Therefore it makes very good sense that next to all the business finance / partnering teams which have popped up in the finance department over the past 10 years that we start to see advanced analytics sections pop up, too, to tackle the monster of big data by analysing the way companies do their analytics, i.e. deciding which models to use instead of letting it be up to the individual finance professional. It is quite logical that companies can’t get value out of Big Data until they have structured their analysis by hiring specialists who can handle the insane amounts of data available.
Where it gets critical is linking the specialist and generalist functions of Finance as the financial business partners need to know enough about the analysis models the company has decided to use to understand the specialist language, while at the same time knowing enough about the business to be able to put the analysis to work for the business.
Has your company figured out a way to do this or are you still struggling with data or specialists who can’t communicate with the business? If so you are probably also in need of some business partnering transformation and perhaps even a Chief Analytics Officer!.