If there’s one thing a finance professional can do forever, it’s analyze stuff. We’re never short of data to analyze, and there are always more details to be ironed out. We love analyzing stuff so much that we almost forget the purpose of doing the analysis.
The purpose is to improve business performance through improved decision-making. That means that the analysis must produce an outcome that can be presented and discussed with business leaders. Too often though, we don’t get to that stage, and yet again finance falls short of making an impact.
It’s time to change the ideal of a good finance professional
I’ve often heard: “You can be the best finance professional in the world, but if you can’t communicate the results of your analysis, then it doesn’t matter.”
There’s only one problem with this statement. If you can’t communicate the results of your analysis, then you’re not the best finance professional in the world! In fact, in a disrupted finance value chain, you’re not much good at all.
I know this is a tough message, but we must signal to all finance professionals that doing analysis will soon be a thing of the past when algorithms and machine learning take over. Through these, we can get much deeper insights and at a much faster pace. Sure, humans might still need to put some finishing touches on it or spend a bit of time interpreting the results, but forget about spending days analyzing stuff in Excel.
Today when I ask finance professionals how much time they spend on the different activities in the value chain, “analysis” often hits 30%. That’s 30% on your own, behind a screen, doing analysis in Excel or some other tool. Granted, if in that time you can produce several golden nuggets of insight that can significantly improve decisions, then it might be worth doing. Most often we don’t though, and if you consider that an additional 35% of the time is spent on working data and reporting, then it leaves very little time to work with your stakeholders to improve their decision-making.
What kind of analysis are we really doing then?
So, what’s an ideal finance professional? We’ll uncover more of the answer in later articles, but building upon a week in the life of the business partner as pictured below, let’s look at how much time is spent on analysis.
It’s Monday morning, and the report landed on your desk as we saw in last week’s article, “Who’s running your reporting landscape?” You spend 15-30 minutes looking through the report to both ensure that the data makes sense and analyze the key developments. Through your previous dialogues with your stakeholders, you already know what’s happening in the business and therefore can much faster connect the variances to real business events.
You’re now ready for the weekly Monday meeting with your stakeholders. We’ll talk more about what happens there next week. On Tuesday though, it’s time to do some more analysis, but in a different way. Here you problem-solve with your stakeholders on how to improve business performance. You use a structured framework to consider your options and prepare a final recommendation to be presented on Wednesday. This could still take a full day or a day and a half, but as much as you’re analyzing your options, you’re also discovering insights and influencing decisions already through the problem-solving stage.
As you can see, this is a very different approach to analysis compared to what you’re used to. Instead of being buried in Excel sheets, you’re out there discussing real business problems with your stakeholders and together with them coming up with solutions. Those solutions, if designed and executed well, will bring tangible value to the bottom line of the company. Are you ready to start analyzing differently?
This article originally appeared on Adaptive Insights, A Workday Company.