In today’s competitive market, businesses that want to succeed need to drive growth forward.
This might sound simple in theory, but it can be a true challenge in practice – particularly when there is an overload of data and information to consider. How can finance professionals take that data and turn it into tangible solutions?
The first thing to note is the difference between data, information and insights, as well as the process to get from one to the other. Once you’ve identified these factors in your company, you can begin to make a plan – whether on your own or with a business advisory service – for driving value in the future.
😯 per cent of respondents claimed that deeper business intelligence was their top initiative to drive growth in the business.
Data – Information – Insights
Most businesses have metrics and analytics measurement tools in place, but how deep do these actually drill into the heart of what makes the company tick? 80 per cent of CFO respondents in an IBM Global study claimed that deeper business intelligence and analytics was their top initiative to drive growth in the business.
In order to achieve a deep and comprehensive understanding of the organisation, finance professionals must first understand the difference between data, information and insight. Data, the unprocessed numbers that live in spreadsheets, is the foundation of this metrics trifecta – but on its own, it’s difficult to put into context.
From the data, professionals can glean information; they might seem the same, but information is effectively data that has been processed into something more digestible, relatable and human-friendly. This information is then analysed in order to find insights. Sound simple? It might be more complicated than it seems.
Compiling and analysing data can reveal actionable insights – if you know what you’re looking for.
Unfortunately, many companies compile and analyse data without first identifying the question they’re trying to answer, according to the Association for Finance Professionals. Employees in finance are typically used to dealing with concrete actuals rather than forecasts for the future, but this is beginning to change. One Japanese CFO from the IBM study elaborates:
“Finance needs to shift the question from ‘what can we do operationally’ to ‘what should we do.'”
“Finance needs to shift the question from ‘what can we do operationally’ to ‘what should we do’… It’s a vastly different question,” they explain. “For example, we are great at driving operational excellence but not so skilled at understanding elasticity of demand and our clients’ willingness to pay.”
Once this question has been identified, finance teams can begin to create a strategy for insight implementation.
How can my business utilise insights?
Points and insights gained through analysing data-driven information are typically quite broad – it’s important to hone them down to what are known as ‘actionable’ insights before moving forward. Actionable insights are feasible goals and observations that can actually drive your business forward.
Forbes writer Brent Dykes emphasises the importance of these six key attributes of actionable insights:
Identifying those attributes in each of your actionable insights will help you both understand and know how to implement them down the road. In some cases, though, businesses might still be unsure how to turn their insights into a game plan for the future. That’s where Reo comes in.
Our business is fundamentally focused on elevating human potential and helping finance professionals drive change in their organisations. Through working with us, you can transform your business and help your employees be the best they can be. Reach out to Reo today for more information.
Can we send you an email?
Join more than 5,000 other smart finance professionals by signing up to our newsletter. You'll get a monthly email with new blog posts, job news, views, and insider tips. Don’t miss out on this valuable advice!