Who Owns Enterprise Analytics and Data?
With the increasing importance of enterprise analytics, the question becomes who should own the analytics and data agenda. This question really matters today because, according to Thomas Davenport, “business processes are among the last remaining points of differentiation.” For this reason, Davenport even suggests that businesses that create a sustainable right to win use analytics to “wring every last drop of value from their processes”.
The CFO is the logical choice?
In talking with CIOs about both enterprise analytics and data, they are clear that they do not want to become their company’s data steward. They insist instead that they want to be an enabler of the analytics and data function. So what business function then should own enterprise analytics and data? Last week an interesting answer came from a CFO Magazine Article by Frank Friedman. Frank contends that CFOs are “the logical choice to own analytics and put them to work to serve the organization’s needs”.
To justify his position, Frank made the following claims:
- CFOs own most of the unprecedented quantities of data that businesses create from supply chains, product processes, and customer interactions
- Many CFOs already use analytics to address their organization’s strategic issues
- CFOs uniquely can act as a steward of value and an impartial guardian of truth across the organizations. This fact gives them the credibility and trust needed when analytics produce insights that effectively debunk currently accepted wisdom
Frank contends as well that owning the analytics agenda is a good thing because it allows CFOs to expand their strategic leadership role in doing the following:
- Growing top line revenue
- Strengthening their business ties
- Expanding the CFO’s influence outside the finance function.
Frank suggests as well that analytics empowers the CFO to exercise more centralized control of operational business decision making. The question is what do other CFOs think about Frank’s position?
CFOs clearly have an opinion about enterprise analytics and data
A major Retail CFO says that finance needs to own “the facts for the organization”—the metrics and KPIs. And while he honestly admits that finance organizations in the past have not used data well, he claims finance departments need to make the time to become truly data centric. He said “I do not consider myself a data expert, but finance needs to own enterprise data and the integrity of this data”. This CFO claims as well that “finance needs to use data to make sure that resources are focused on the right things; decisions are based on facts; and metrics are simple and understandable”. A Food and Beverage CFO agrees with the Retail CFO by saying that almost every piece of data is financial in one way or another. CFOs need to manage all of this data since they own operational performance for the enterprise. CFOs should own the key performance indicators of the business.
CIOs should own data, data interconnect, and system selection
A Healthcare CFO said he wants, however, the CIO to own data systems, data interconnect, and system selection. However, he believes that the finance organization is the recipient of data. “CFOs have a major stake in data. CFOs need to dig into operational data to be able to relate operations to internal accounting and to analyze things like costs versus price”. He said that “the CFOs can’t function without good operational data”.
An Accounting Firm CFO agreed with the Healthcare CFO by saying that CIOs are a means to get data. She said that CFOs need to make sense out of data in their performance management role. CFOs, therefore, are big consumers of both business intelligence and analytics. An Insurance CFO concurred by saying CIOs should own how data is delivered.
CFOs should be data validators
The Insurance CFOs said, however, CFOs need to be validators of data and reports. They should, as a result, in his opinion be very knowledgeable on BI and Analytics. In other words, CFOs need to be the Underwriters Laboratory (UL) for corporate data.
Now it is your chance
So the question is what do you believe? Does the CFO own analytics, data, and data quality as a part of their operational performance role? Or is it a group of people within the organization? Please share your opinions below.
Solution Brief: The Intelligent Data Platform
CFOs Move to Chief Profitability Officer
CFOs Discuss Their Technology Priorities
The CFO Viewpoint upon Data
How CFOs can change the conversation with their CIO?
New type of CFO represents a potent CIO ally
Competing on Analytics
The Business Case for Better Data Connectivity