How CFOs can unlock business growth with data and analytics

CFOs' top priorities center around profitable growth and innovation to combat inflation, disrupted supply chains, and scarcity of talent. This means investing in initiatives such as digital transformation, focusing on strengthening cash flow, upskilling talent, and reducing costs.

For organizations to grow, they need new, intelligent ways of working, with democratized access to data and insights across the enterprise. Genpact's report, CFOs empowering enterprises in the age of instinct introduces three macrotrends shaping the future of societies, companies, and finance functions. CFOs have a unique position at the heart of the business, enabling them to connect data, knowledge, people, and insight from across their ecosystems to make fast, accurate decisions that benefit users and customers.

In doing so, finance's reach goes beyond the function itself. Finance can harness its data and analytics capabilities to create a roadmap for a business' goals, shifting from a cost function to one that creates value, empowering businesses to be capable of connecting, predicting, and adapting at speed.

Prior to the pandemic, finance was already blessed with sophisticated data skills and visibility of what was happening across the enterprise. But the unique challenges that have since emerged have refined many functions' capabilities and left them better able to harness growth opportunities.

First, finance teams have refined their forecasting skills. Second, different functions and teams now work closer together, from finance and treasury to supply chain and commercial teams. And investments in digital capabilities have sought to harness analytics and deal with tumultuous business environments.

Operational and financial views have come closer together. And CFOs have delivered the agility company leaders need to chart disruption. By proving their ability to do so in a time of crisis, finance teams are continuing this strategic role for good. It's why 29% of CEOs hired post-pandemic came directly from the CFO seat, a higher percentage than in the previous 14 months, according to Heidrick & Struggles.

Underpinning finance's ability to unlock growth and create value is its position as the guardian of enterprise data. In many organizations, finance is responsible for key metrics or reporting. But for more accurate, forward-looking, strategic decision-making – and not just financial decision-making – CFOs must take on their vital role as data guardians, building insight engines capable of transforming entire end-to-end value chains.

Many finance teams have integrated data from multiple silos into data lakes, realized radical standardization that streamlines the data-to-insight-to-action loop, and recognized the importance of external data from third parties too. When finance has integrated a business' data and systems into a single enterprise-wide platform, analytics and collaboration become seamless with access to real-time insight creating new ways to unlock value.

Improved forecasting is one such unlocked opportunity. A finance function with advanced digital technology embedded throughout the organization brings practical insight and fast, accurate forecasting capabilities to business leaders. This enables them to anticipate customer needs, business opportunities, and threats.

With improved forecasting capabilities thanks to advanced data and analytics, finance teams are expanding their remit beyond financial forecasting and demand planning to include supply chain forecasting. They're even analyzing and predicting customer preferences and anticipating CapEx plans, linking them back to potential returns to fuel growth.

Importantly, these insights are becoming more niche and personalized, answering not just what a forecast means for a business, but for specific teams, sectors, and individuals.

Finance functions are also using advanced analytics to personalize experiences. By segmenting customers based on their profitability, for example, finance teams can identify how a business should customize how it serves these groups and how much investment should go toward targeting each individual. The same goes for suppliers. Finance executives can determine which vendors an enterprise should develop stronger relationships with to get better terms.

Personalized experiences can also help close the data-to-insight-to-action loop nudging people toward certain actions and behaviors. Algorithmic trading is a case in point, with real-time data on currency and stock fluctuation integrated and converted into a personalized dashboard for each trader or investor and investment strategy. It makes suggestions for different investment actions through experience and quality insights.

As finance teams form closer ties to other parts of the business – from operating teams to supply chain functions – visionary CFOs are strengthening these relationships by placing connected planning at the center of their transformation efforts.

Connected planning breaks down information silos to eliminate inefficiencies between financial, corporate, and operational planning. It's a key step toward creating a connected operation that has fast access to insights and can make the right decisions, grasping opportunities and side-stepping risks.

Connected planning can deliver real-time scenario analysis. Different parts of an organization can harness this information to create a common plan, enabling the enterprise to fulfill demand more effectively. Connected planning also provides visibility and collaboration across the enterprise, while freeing up time for finance teams to focus on strategic initiatives.

From their position at the heart of the business, CFOs and finance teams are integral to orchestrating a connected planning agenda that drives growth.

Case study: Connecting planning for finance and supply chains

A CPG company was using hundreds of spreadsheets and outdated legacy tools to manage its supply chain and financial planning, which led to major discrepancies between forecasts and actual costs.

With a connected planning process and platform, it integrated finance and supply chain planning. Finance could now accurately evaluate its product costs and profitability and anticipate and act on market changes in real time.

The planning process used to take two weeks, now it's done in just two days. And the company can create demand scenarios and adjust production in five minutes when it used to take five days to analyze and react to changes in demand. With greater visibility, executives can make quick, fully informed decisions for growth.

Data and analytics are integral to a CFO's ability to unlock business growth and respond to demand. As CFOs act more like analytics leaders, we're seeing an accelerating trend across finance-related job descriptions looking for candidates with skills in data and analysis.

The benefits of prioritizing these skills go beyond the enterprise, with future-facing finance functions able to harness their analytics capabilities to drive transformation outside the business too.

A consumer goods company, for example, is performing root-cause analysis on any incorrect invoices it receives from suppliers. By sharing this insight with suppliers, the invoices it receives are now accurate and processed touchlessly, helping to pay suppliers on time and improving relationships across the supply chain.

Enterprises today collaborate more closely than ever with external partners, vendors, and competitors as they innovate and grow together. New technologies like blockchain, for instance, are allowing businesses to share data securely, creating the potential for open-source insight platforms, enabling an entire ecosystem to solve challenges beyond the capabilities of one enterprise.

As businesses tap into growth opportunities, finance functions with access to critical analytics skills and insights are creating tomorrow's successful enterprises.