Part of the “Navigating Disruption Today, Planning for Tomorrow” series
Knowing that “business as usual” will never happen again, midsize companies are pulling together all their resources to figuratively keep their doors open in a world where they literally can’t. But this is not the time for finance leaders to merely collect, validate, and report information while providing day-to-day budget guidance, closing the books, and ensuring policy compliance.
It’s time for finance leaders to up the ante by using analytics to help the business survive today’s long shadow of disruption and find a way toward a future recovery.
A path forward guided by numbers and empathy
According to interim results in March 2020 from Oxford Economics and SAP research, 53% of midsize companies have all the data they need to support capital spending improvements. However, deriving insight from this data is considered a more significant challenge than collecting it.
The COVID-19 pandemic has brought a mix of growth and decline for midsize businesses. Regardless of which side of the economic landscape a company falls on, there are always risks to consider.
It’s vitally important to map new routes to avoid those pitfalls and explore the possibilities ahead. The business may be facing no revenue in the short term as expenses keep adding up. Loan forgiveness may be on the horizon. Furloughing staff may be a necessary option. Perhaps, the better choice is an extended line of credit.
There are so many choices, and each one needs to be evaluated carefully to ensure the best-possible fiscal gain without harming shareholders and the employees on which the company depends. Fortunately, finance teams are mathematically inclined, making them the perfect partners for adding value to these discussions. But charting a path through a world that’s always changing requires more than static spreadsheets full of outdated data.
Intelligent data analytics tools – such as predictive analytics, machine learning algorithms, or scenario modeling – enable finance employees to bring information together instantly across all areas of the business. But at the same time, finance employees have the freedom to assess this intelligence with a mix of pragmatism and empathy that is sorely needed today.
Modern predictive analytics allows finance leaders and their teams to simulate various business outcomes when planning and assessing financials. This tool is especially helpful when no single course of action is apparent at the time and many scenarios need to be considered. It can help plot a journey based on a baseline. Then, finance teams can further explore potential outcomes with modern analytics – such as data visualization – to generate meaningful discussions among organizational and business stakeholders.
This balance of real-time data intelligence and humanity allows organizational leaders to quickly come to a consensus on the best course of action at that point in time. And when things change, they know the business can pivot on the fly and get moving in the right direction.
A dynamic world calls for dynamic insight
Now is not the time to make decisions through emails, team meetings, or telephone calls. Traditional planning might have meant working around traditional deadlines, but those traditions don’t apply in such a fluid and turbulent state. Decisions need to be made instantly and in the moment – and this new normal involves everyone collaborating in the moment to make the right decisions.
Such an ever-changing world requires dynamic analytics solutions to keep up. However, this reality does not necessarily mean that midsize businesses should make a substantial investment in technology and devote the time that is already scarce for a significant implementation.
Right now, intelligent analytics tools are available in the cloud and designed to instantly model the business and support collaboration in the application, as well as on mobile devices. Midsize businesses can quickly upload the solutions they need in a matter of hours and give the right employees access to them, whether they are working in the office or from a remote location. Better yet, they can add new capabilities as needs change and act immediately.
For finance organizations, such a technology-enabled transformation can become an empowering development. This moment is when they can finally move beyond order-taking and report generation to drive real value for the business. Now, finance leaders can leverage a skill set that informs decisions with real-time scenario modeling and brings people together to ensure alignment and consensus – all as a critical partner for all business areas.
For further exploration of how financial managers can navigate disruption today while planning for tomorrow, watch our mini-webinar, “Weather Financial Uncertainty with Strength and Resilience.”
This blog is part of a series offering suggestions to help small and midsize companies weather the challenges related to the pandemic. You can find other blogs in the series at the archive page, Navigating Disruption Today, Planning for Tomorrow.