Why CFOs need to drive the next wave of transformation to supercharge organisationsBy Chong Yang Chan
Many businesses in Singapore have been forced to rethink their customer engagement and business strategy. In short, the pandemic provided an on-ramp for brands to transform their business models to address shifting consumer habits to set them up for success for the next couple of years.
This is easier said than done. Especially for retailers, the move to digital cannot come fast enough. It took a global pandemic to finally push the slow crawl to the end for the 163-year-old institution that is Robinsons, a once-popular department store that struggled for years. It finally shuttered in Singapore for a time in 2021, only to re-emerge as an online mall that same year.
As more organisations steadily embrace digital technologies, they are turning to their CFOs as the key sponsors of change and transformation. Sitting at the heart of any organisation and having a 360 view of strategic investments required to optimise and operationalise new business models, CFOs are well positioned to become the critical drivers of innovation.
At least in theory.
Ditch manual processes
What’s missing for most CFOs trying to invest in innovation today is the ability to quickly make sense of new data, to accurately compare forecasts with actuals in real-time for ongoing trends analysis. The tools that CFOs rely on today are rigid, siloed, and predicated on manual processes that limit access to real-time insights.
From a practical perspective, when supply chain, customer relationship management (CRM) and entity relationship model (ERP) data needs to be integrated to give finance the right answers to questions, the process must be invisible to CFOs and their teams. When hundreds of reports have to be delivered annually to the board, shareholders, stock markets and others - the process of gathering the financial intelligence must be fast and accurate.
When looking at analytics dashboards, the information must be accessible to people beyond the data science team. And when actions need to be taken but have not been—like a Just In Time (JIT) supplier payment on 30-day net terms—the automated alerts need to be crystal clear and timely.
All this simplicity at the front end demands considerable sophistication at the back. With data rarely in one place, CFOs and their teams have historically had to rely on dropping disparate sources of information into spreadsheets.
Many are still forced to do so today due to long-standing legacy, organisational and technical challenges, and the fear of risks and uncertainty when experimenting with new ways of working.
Arming CFOs with an ‘Active Intelligence’ framework
To gain greater agility, organisations need to arm CFOs with the ability to see ahead—to access data across multiple systems (both on-premise and cloud sources) and turn raw data into trusted, actionable insights that can guide and improve decision-making. More importantly, CFOs and their teams need to be able to not just access but understand these data sets.
One of the most important innovations in business intelligence is making analytics more proactive and less intimidating no matter one's business function. A new generation of analytics should empower users at any skill level to explore and understand data, a concept we call “Active Intelligence” that enables CFOs to move at speed.
Retail does not have to fall behind eCommerce. Al-Ikhsan Sports, a leading sports retailer in Malaysia, is an example of how it has leveraged business intelligence to drive success. With 135 stores across the country and an eCommerce platform, Al-Ikhsan Sports needed a better way to measure each store’s performance, monitor revenue and profitability in real-time, and also assess performance drivers—specific products or store promotions—that were impacting sales. The lack of visibility affected the business’ operational and financial control, and the ability for stakeholders to make forecasts, set budgets, and plan.
In short, Al-Ikhsan Sports needed a robust business intelligence platform to guide intelligent decision-making. To this end, the retailer began modernising how it uses data. This solution gave Al-Ikhsan Sports access to timely information across locations, products, price points, and customers to minimise margin erosion while optimising operations to provide a great customer experience—both off and online. With the power of analytics, Al-Ikhsan Sports improved its decision-making and business strategy to capture market share and grow its network of stores by 20 percent.
Business intelligence (BI) platforms that make people do the hard work encourage only niche groups of employees to access data and is an outmoded and irrelevant approach. In today’s dynamic business landscape, organisations that want to move at speed need to equip CFOs with active intelligence tools to optimise every moment with informed decisions - that’s the true path forward.