Findings from a survey reported recently showed that roughly half of senior finance executives in the U.S. said they wanted to beat their competitors by mastering Big Data, yet less 
than a quarter said they will focus on implementing that technology over the next year preferring to focus on the better integration of their companies’ existing information systems.
My original Tweet about it got re-Tweeted quite a bit suggesting that others found these figures quite surprising as they suggest that Finance is insufficiently convinced to invest in the required technologies. But as ever with research, it’s worth taking a few minutes to understand the context in which it was done.
First thing to note is that the survey was commissioned by American Express Global Commercial Payments and one suspects that their primary objective was to generate media coverage rather than rigorous insight. The second is that as ever with ‘vox pop’ surveys, there is little detail of the research methodology itself other than it was carried out by CFO Research Services using an online survey that generated 154 responses backed up with an undefined number of interviews with senior financial executives, This leads one to suspect that the findings are based on a self-selected sample that enjoy filling in surveys from the many thousands of subscribers to CFO Magazines excellent e-Newsletters. What’s more, whenever I’ve been involved in generating questions for a survey designed for PR purposes, there is always an unspoken tendency to word questions and multiple choice response options to produce news-worthy findings. Well, we’re hardly doing clinical research looking a cure for dementia, are we!
So given those initial reservations about the context and robustness of the research, how should we react to specific findings such that roughly half of the respondents said they wanted to beat their competitors by mastering ‘Big Data’ yet so few are planning to invest in it next year? We could:
- Be aghast that it wasn’t 100% and full of disdain for the other 50% of senior finance folk who appear to be saying they don’t give a cuss about beating their competitors.
- Be amazed that it was so high, because although Finance undoubtedly has a need for ‘Big Data’, gaining competitive advantage from better customer insight falls predominantly into the remit of marketing and commercial folk..
- Be assured that respondents are taking a prudent approach to adopting new technology?
Without sight of the survey questions, any or all of these responses are entirely valid. Seems to me the way you view the findings of this – and indeed most other – research is most likely more influenced by your own expectations and beliefs than by the actual data. Our expectations are all we have to judge it against as most of this type of research is done as one-off studies rather than repeated over time which would give us a far better understanding of what is really happening.
I suspect that asking Finance folk questions about ‘Big Data’ technologies automatically brings bias and confusion and that asking simpler questions that are free of jargon such as about improving the response times of your core financial systems and having far quicker access and analysis of financial data would have generated significantly different findings with near universal agreement that such benefits are worth pursuing. The proof of the pudding is in the eating with companies such as the German heating and ventilation specialists Vaillant seeing mind-boggling improvements once they migrated their data warehouse on to SAP HANA – the in-memory calculation engine. The figures below make no mention of the benefits that occurred elsewhere in the business, such as the 22% increase in operational efficiency in IT, just the ones in Finance;
- Annual saving of 2,500 work days in business planning activities equivalent to €920,000
- 92% reduction in the time need to process a planning and budgeting run from 3 hours down to 15 minutes
- 98% faster reporting for accounts receivable and reduction in days sales outstanding
- Euro 80m improvement in working capital
- 90% faster forecast plan validation from 5 minutes to 30 seconds
Documented case studies such as this that contain quantified benefits of improvements in core financial processes – and are mercifully free from the type of jargon that guarantee headlines while masking meaning – should convince Finance that investments in new technologies make incontrovertible sense.
Meanwhile watch Mamum Natour, Head of BI at Vaillant tell their amazing story: