It’s Time for CFOs to Fully Unlock the Power of Data

The role of the CFO has changed radically in recent months.

Impacted by the introduction of digital practices in the work environment (which, in part, were a response to the coronavirus pandemic), CFOs are being swept up by the tides of technology and pressured to use data to automate processes – enabling them to become a catalyst for growth.

So, what’s standing in their way? Well, perhaps ironically, it’s a question of funding.

Following the pandemic, finance functions are increasingly being asked to do more with much less – something that puts pressure on back-office costs and, ultimately, curtails investment in digital transformation projects.

But while cost reduction might be an immediate priority, it should not impact a business’ long-term goals. So how can a business grow while saving money? The answer lies in digitisation. Or, more specifically, digitising finance.

Connecting your technology with actionable data and analytics

The pandemic has had a huge impact on business planning. Research from Dun & Bradstreet found that almost half (45%) of UK-based CFOs and finance leaders are embracing new technologies to improve efficiencies – and rightly so!

Investing in modern, enterprise-grade CRM, accounting and ERP software is a crucial building block, but it’s only part of the puzzle. The real priority for any CFO should be to invest in high-quality data and analytics to power modern technology and get ahead of the game – helping them to understand the risks and opportunities the business faces now and in future.

As it stands, CFOs have a thorough understanding of how much they’re owed by various parties, as well as how old that debt is. But what may be unclear is how risky that debt is, which could create significant problems further down the line when collecting outstanding payments.

If finance professionals aren’t sure about which customers already owe what money, whether or not that debt is overdue, or (conversely) whether the company in question is performing well and should be trusted to deliver repayments, they don’t have the understanding they need to make properly informed decisions.

Powering automation

Using automation to get these insights is only possible if a business has got clean and usable data in the first place. It’s only by using high quality data that finance professionals can improve operating efficiencies and add competitive differentiation.

Lewis Hamilton’s Mercedes is a near perfect machine. But fill it with diesel and it won’t make it out of the pit. Fill a business with bad quality data and analytics and… you get the idea. Put garbage in, get garbage out.

Once data is clean, structured and actionable, the rest of the digital transformation project doesn’t seem like such a huge undertaking – from onboarding new clients to managing the ongoing risk and opportunity and maximising the collection and application of cash.

And getting that clean, actionable data is exactly where a partner like Dun & Bradstreet can help.

Reimagining the role of the credit professional

Commercial credit management has historically been seen as a risk-mitigation function, preventing goods and services being provided to companies that either cannot (or choose not to) pay within the agreed terms.

But the role is now increasingly growth-focused, with an expectation of revenue generation balanced with prudent risk management.

By making best use of data, analytics and modern technology, CFOs won’t risk making the role of the credit professional redundant through automation. Instead, they’ll simply help to reframe the role by moving staff away from clerical tasks and towards more engaging value-added priorities.

Ultimately, following the coronavirus pandemic, the digital transformation of every sector has been accelerated. Finance professionals need to stay ahead of that curve. CFOs should see themselves as the new digital sheriffs in town – but they need their data deputies to help reimagine that digital-first role in a post-COVID world.

To find out more, watch our latest webinar titled “Dynamic Finance Organisations: Data & Analytics to Help Understand Risk Exposure” or get in touch with us.

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