CFOs Shifting to Chief Data Officer Role in Finance

Editorial & Advertiser disclosure

Global Banking & Finance Review® is an online platform offering news, analysis, and opinion on the latest trends, developments, and innovations in the banking and finance industry worldwide. The platform covers a diverse range of topics, including banking, insurance, investment, wealth management, fintech, and regulatory issues. The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.

Data ownership shifts to finance as nearly half of surveyed CFOs act as Chief Data Officer

Adaptive Insights, the only pure-play cloud vendor to be named a leader in strategic cloud corporate performance management (CPM), today released its global CFO Indicator Q3 2016 report, revealing CFOs’ views on how they plan to increase the tracking of non-financial key performance indicators (KPIs) to determine and forecast corporate performance. Traditionally focused on pure financial data, such as revenue, cash flow, and profitability, today’s CFO is increasingly faced with incorporating non-financial data—from supply chain data to customer satisfaction—into their planning, forecasting, and reporting, as these metrics often provide a more accurate, long-term view of an organisation’s future.

The report discusses the growing impact of non-financial KPIs; why CFOs and their teams should lead the effort in identifying and defining them; and how business processes and skillsets must change to accommodate these new non-financial metrics.

“CFOs are increasingly tasked with not only understanding and communicating financial results but helping the organisation to understand the operational drivers behind them,” said Robert S. Hull, founder and chairman at Adaptive Insights. “By reporting, analysing, and planning using a blend of financial and non-financial KPIs, the office of finance can help business leaders across the organisation to spot trends early, which will help mitigate risk or take advantage of opportunities. The challenge is that assimilating operational and financial data rapidly into a single source of truth that can be used for reporting and planning can be a daunting task for many finance teams.”

This quarter’s study reveals that more than three-quarters (76%) of CFOs report that their finance teams are tracking some non-financial KPIs today, comprising up to 20% on average of the total. Looking ahead two years, nearly half (46%) of CFOs anticipate that to increase, with non-financial KPIs expected to comprise up to 30% on average of the total KPIs tracked. Including these non-financial KPIs will require CFOs to have increased access to a variety of data and collaborate more effectively across their organisations.

CFOs to drive KPI definition and tracking

While CFOs have previously reported that their organisations are not aligned on metrics, this study shows they are in an ideal position to drive consensus around KPIs in their organisation. According to the survey, they are also taking a greater role in owning all of their organisations’ data, with nearly half (45%) of CFOs reporting they currently fulfill the role of chief data officer in their organisation.

Based on the findings, the CFO Indicator Q3 2016 report advises CFOs to:

Adopt systems that provide more efficient access to data: Because identifying non-financial KPIs requires the office of finance to dig much more deeply into the business, CFOs will need to free themselves and their teams to engage in the deep analysis that leads to greater business insights. This quarter’s report reveals that source systems continue to rise—especially at the high end, with 12% of CFOs managing 10 or more source systems, up from just 8% a year ago.
Infuse themselves and their teams with greater business understanding: CFOs have previously reported that this skill is missing from their teams, and they intend to develop their teams through greater collaboration and integration with other parts of the business.
Collaborate more effectively: While CFOs realise they can and should collaborate with other parts of the business, they have also reported that a lack of time prevents them from collaborating and engaging in strategic tasks, and that more efficient business processes and technology will be used to overcome this challenge.

Data ownership shifts to finance as nearly half of surveyed CFOs act as Chief Data Officer

Adaptive Insights, the only pure-play cloud vendor to be named a leader in strategic cloud corporate performance management (CPM), today released its global CFO Indicator Q3 2016 report, revealing CFOs’ views on how they plan to increase the tracking of non-financial key performance indicators (KPIs) to determine and forecast corporate performance. Traditionally focused on pure financial data, such as revenue, cash flow, and profitability, today’s CFO is increasingly faced with incorporating non-financial data—from supply chain data to customer satisfaction—into their planning, forecasting, and reporting, as these metrics often provide a more accurate, long-term view of an organisation’s future.

The report discusses the growing impact of non-financial KPIs; why CFOs and their teams should lead the effort in identifying and defining them; and how business processes and skillsets must change to accommodate these new non-financial metrics.

“CFOs are increasingly tasked with not only understanding and communicating financial results but helping the organisation to understand the operational drivers behind them,” said Robert S. Hull, founder and chairman at Adaptive Insights. “By reporting, analysing, and planning using a blend of financial and non-financial KPIs, the office of finance can help business leaders across the organisation to spot trends early, which will help mitigate risk or take advantage of opportunities. The challenge is that assimilating operational and financial data rapidly into a single source of truth that can be used for reporting and planning can be a daunting task for many finance teams.”

This quarter’s study reveals that more than three-quarters (76%) of CFOs report that their finance teams are tracking some non-financial KPIs today, comprising up to 20% on average of the total. Looking ahead two years, nearly half (46%) of CFOs anticipate that to increase, with non-financial KPIs expected to comprise up to 30% on average of the total KPIs tracked. Including these non-financial KPIs will require CFOs to have increased access to a variety of data and collaborate more effectively across their organisations.

CFOs to drive KPI definition and tracking

While CFOs have previously reported that their organisations are not aligned on metrics, this study shows they are in an ideal position to drive consensus around KPIs in their organisation. According to the survey, they are also taking a greater role in owning all of their organisations’ data, with nearly half (45%) of CFOs reporting they currently fulfill the role of chief data officer in their organisation.

Based on the findings, the CFO Indicator Q3 2016 report advises CFOs to:

Adopt systems that provide more efficient access to data: Because identifying non-financial KPIs requires the office of finance to dig much more deeply into the business, CFOs will need to free themselves and their teams to engage in the deep analysis that leads to greater business insights. This quarter’s report reveals that source systems continue to rise—especially at the high end, with 12% of CFOs managing 10 or more source systems, up from just 8% a year ago.
Infuse themselves and their teams with greater business understanding: CFOs have previously reported that this skill is missing from their teams, and they intend to develop their teams through greater collaboration and integration with other parts of the business.
Collaborate more effectively: While CFOs realise they can and should collaborate with other parts of the business, they have also reported that a lack of time prevents them from collaborating and engaging in strategic tasks, and that more efficient business processes and technology will be used to overcome this challenge.