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Data should be managed as a valuable asset by people with clearly defined roles and responsibilities.
In many companies, this question remains unanswered. Of course, some CFOs do have that ambition and are keen to building on their traditional task of managing data entry and data analytics. But times have changed and, in view of the enormous rise of data gathering (besides purely financial data), one might also consider attributing the role of data broker to the Chief Data Officer or Chief Information Officer.
On a side note, regarding data consolidation and governance, it is important to decide whether data should be stored and maintained in the ERP system or not. That is still the case in many companies but, increasingly, a central data management platform – consider it an ERP for data – is preferred because of the efficiency gains that can be made. In this second scenario, data entry happens in a broad range of systems. It is then collected and consolidated in the master data management platform that acts as a single system of record. The result is a clear distinction in roles between the ERP, which manages the processes, and the master data management tool, which manages and maintains the data that then feeds those processes.
Finding the best organizational structure to meet these needs is easier said than done. One might even expect the role of IT to evolve into that of managing the infrastructure, with the responsibility for data and information being transferred to the Chief Data Officer. But what would that leave Finance with? Nothing more than traditional number-crunching tasks? CFOs who want to prevent this shift need to be aware of the importance of business partnering and analytical skills that are needed to safeguard their role and responsibilities in the digital age.
These new skills and mindset become even more important when data needs to be leveraged and monetized. Think of marketing automation campaigns, for example. If such campaigns are not supported by the right data in the right context, you end up wasting a lot of money plus you risk losing customers who are irritated by misaligned campaigns.
This article is the third of a series of 6, in which I dive deeper into the 5 challenges CFOs are facing today.
I also shared some of my findings in the report `Fast Forward Transformation or Back to Basics?’
