For many finance organizations, just the thought of Big Data can generate anxiety. It’s too large to harness effectively, and too diverse to process with existing relational databases and analytics tools. With uniquely complicating factors like ever increasing data volume, velocity and variety, Big Data overwhelms the systems and technologies today’s companies have in place to manage business performance.
All this is reflected in a recent BPM Partners survey of 250 enterprise decision-makers. BPM learned that when it comes to understanding what really drives a business and how to gain insights that help improve margins and operational performance, nearly half (47.5 percent) of those surveyed said the same thing:
We have a Big Data challenge.
And it’s finance that feels the challenge most. BPM found roughly seven out of 10 decision-makers say financial data is causing their most significant Big Data problems as they pertain to performance management. It’s not hard to imagine why. Data volumes are exploding to petabyte and exabyte levels, and making use of them requires tying together financial, operational, transactional, machine, social and benchmark data into a cohesive whole that enables better business decisions. It also means moving from a quarterly or monthly view of performance to daily, hourly and even real-time. That’s a lot to take on when you’re accustomed to making decisions about your business based on historical top-line numbers pulled every few weeks from your transactional and ERP systems.
Craig Schiff, president and CEO of BPM Partners, recently dug into these survey results in a webinar discussing how finance organizations can use Big Data to develop more accurate plans and forecasts, reliably predict future outcomes, and help shape the decisions made at the edges of a business. I joined Craig in the webinar to illustrate his points with examples of how companies are using Big Data in the real world. You can view a replay of the webinar, “Big Data Finance: Unlocking the Door to a New World of Business Planning,” to learn what organizations should be focusing on as they try to find their way in a Big Data world.
View the replay to discover what organizations want from Big Data, and where their current solutions fall short. Among the findings:
- Collaboration makes all the difference. BPM found three out of four (74 percent) of respondents say they’d use collaborative features in their performance management platform – if only their current solution offered them. Even those who don’t yet have these capabilities recognize that when people outside of finance contribute to planning and forecasting, they end up with improvements in budget creation and development, forecasting accuracy, performance reporting and analysis, strategic planning, profitability optimization, consolidation, and even the monthly close.
- Data visualizations should be interactive. For about 70 percent of organizations, static dashboards and simple bar charts don’t cut it. Decision-makers want to drill down to see performance data at granular levels – by product, part, SKU, ticket, employee, etc. And if they adjust an assumption or parameter, they want to immediately see the impact that change would have on everything else – and 73 percent want those capabilities baked into their performance management platform.
- Too few executives grasp the importance of predictive analytics – but that will change. Only 22.7 percent of respondents view predictive capabilities as “essential” to forecasting, with another 52.2 percent calling it a “nice to have. But Schiff argues that the “essential” slice of that pie will grow rapidly as more companies realize how advanced predictive capabilities with such features as causation, correlation, and root cause analysis can help them better align labor resources with demand, anticipate disruptions in supply chains, and forecast the impact of weather on consumer buying behaviors for example. Predictive analytics is no longer a “black box” when it is part of an integrated performance management system.
- Ease of use is now a given. We live in a Turbo Tax world, which has taught millions of users that a well-designed experience can turn a previously complicated task into something virtually anyone can do with little or no training. Even as performance management software ingests, analyzes and visualizes Big Data, it must remain intuitive enough to push insight and analysis to every corner of the organization, while providing the same experience on any device an employee uses.
- Context is everything. Enterprise data alone isn’t enough to enable truly data-driven decisions. Organizations need to understand the meaning of their raw performance metrics by integrating structured, behind-the-firewall data with unstructured, external data from dozens of sources, from Bloomberg to Twitter to the Bureau of Labor Statistics.
The webinar explores other findings as well, including the benefits of conducting what-if scenarios at a Big Data scale, and what’s keeping most vendors from tying multiple scenarios together so decision-makers can appreciate the total impact of their actions. And there are detailed examples from leading retailers and restaurant businesses, that reveal how using advanced analytics can determine who is your most profitable customer segment or which products sell best together.
View the complimentary webinar replay today, and find out what Big Data Finance could mean for you.