3 critical components to building a data-driven finance organization

Finance leaders know that to navigate through an uncertain and constantly changing environment, access to real-time and reliable data is no longer a luxury, but a requirement.

Despite this problem impacting finance leaders regardless of industry, many organizations still fall short in turning their data intentions into actions. While there is no one-size-fits-all solution, there are three universal components where IT and finance can partner to advance their pursuit of building a more data-driven finance organization using culture, talent, and technology.

1. Cultivate a data culture

Building a data-driven organization doesn’t happen overnight, yet it’s an essential component of future success. Leaders must expand their definition of a data-driven culture to include not only decision-making, but also curiosity and a willingness to question assumptions.

This is where collaboration between IT and finance is critical. Data accessibility can make a real difference, along with technology that empowers team members to explore that data (in a way that’s relevant and appropriate to their role).

Data alone does not make a data-driven company. If anything, accelerating data volume and velocity means most teams have more information than they know what to do with. A data-driven company is sustained by a data centric-culture, one that empowers teams with the right tools and spirit of collaboration to make sense of all that data they have.

2. Foster the right talent

Organizations that invest in modernizing their finance function will naturally attract more finance talent with the next-gen skills — including data analytics — they so desperately seek.

Few people are excited by the prospect of working on manual or repetitive tasks. Instead, top talent is drawn to organizations that have embraced innovative technology that streamlines core processes, allowing them to spend more time on meaningful work. Modernizing the finance function creates a virtuous cycle of attracting future-ready talent to power the organization even further.

Building a data-driven finance organization requires a transformation that is only possible through close collaboration between finance and IT. This collaboration necessitates talent on both teams to prioritize critical thinking, curiosity, and communication. Hire and retain talent that can proactively identify potential problems your organization might face and solve them before they become detrimental. And, just as importantly, identify talent that wants to share these skills with the full team to create an environment of constant learning.

3. Embrace future-ready technology

It’s not possible to build a data-driven organization if your data isn’t readily available. But data accessibility is often impeded by siloed finance solutions.

Rethinking your underlying technology is no small consideration. But the risks that come with sticking to the status quo — simply because it is the status quo — are only rising. It’s imperative that organizations reassess whether the technology they’re using is merely a tool to be manipulated or a strategic enabler of finance’s full potential.

To compete today, companies need to be data-driven. Getting there requires collaboration between IT and finance, strategic intention, and targeted action, particularly around the components that unite almost all modern finance organizations.

Adapted from: “3 Critical Components to Building a Data-Driven Finance Organization”, by Joseph James, chief financial officer of Apex Capital, published on CFO News on 14 March 2023.