Predicting the future has always been the holy grail for CFOs, who are tasked with maintaining their enterprises' financial health and carefully considering capital, strategy and innovation investments.
Decision-making in this context is moving through a period of transformation thanks to advanced technologies, including machine learning that can enable CFOs to see into the future with exceptional accuracy.
Reading Deloitte’s Analytical Advantage report reveals that 18% of CFOs have analytical oversight across their companies. And finance is often the area of an organisation that will invest in analytics. So, CFOs are in a unique position to shift their focus to become more active influencers in their businesses' overall strategic planning.
I believe the shift in the CFO's role is essential. CFOs have the knowledge and historical data to enable them to see into the future. Questions about innovation costs, supply chains, and workforce expansion continue to all come under their remit. The pandemic has taught every business that resilience against the unknown is now a critical foundation they must build their post-pandemic enterprises upon. From inventory to talent, the essential mission-critical components of a business must be protected. Here, the CFO, I think, has a pivotal role to play. Transforming data into insights that can guide a business into their prosperous futures needs a steward that understands how the components that make a business function can be optimised. The skillset CFOs have developed to ensure the financial health of their businesses can be applied to broader business strategy.
The power that predictive analytics can deliver is to transform a business from being reactive to becoming proactive.
I have witnessed many business leaders who have constantly said that if they had known about the events that had a negative impact on their businesses, they could have reacted to mitigate the impact this event had. To be clear, no predictive analytic system is a complete and accurate window into the future, but what these systems can do is make robust predictions based on many factors. Again, the quality of the data these systems have available is paramount.
Data-led insights are how CFOs will become the hub around which many business functions will orbit. Where CFOs and their teams had occupied a narrow and often blinkered position in their companies, today, CFOs synthesise business value from the insights they have gained.