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New Study Reveals CFOs Value Data-Driven Decision Making

Big_Data_Innovation_Summit_BostonAdaptive Insights, a leader in cloud corporate performance management (CPM) and business intelligence (BI) for the biggest brands and the hottest companies, unveiled its Q1 2015 CFO Indicator. The CFO Indicator reports what is top of mind for CFOs, as well as unveils key attributes that define the modern CFO. Based on a survey of more than 250 CFOs across the United States, the CFO Indicator reflects a positive outlook despite global instability, with the majority predicting a rise in the US dollar (75 percent), climbing stock prices (61 percent), plummeting gas prices (55 percent) and a record-breaking technology IPO market (33 percent). CFOs foresee an increase in global capital expenditures (54 percent) and continuation of global instability (42 percent).

As CFOs navigate through the dynamics of global business and volatile markets, the requirements of their role are evolving. In previous years, the role of the CFO was primarily centered around being a strong financial leader, focused on financial reporting, regulation and compliance, risk management and cost control. In today’s digital age where businesses compete more using data and analytics, successful modern CFOs are partnering with CEOs and other business leaders to lead business transformation.

Modern CFOs have the opportunity to rise to an unprecedented level of value creation,” said Rob Hull, founder and chairman at Adaptive Insights. By driving a culture of agile, data-driven decision making throughout a company, CFOs can help create a significant competitive advantage. Adaptive Insights’ cloud platform provides a 360-degree view of the past, present and future of the business, enabling CFOs to achieve the highest level of business performance.”

Adaptive’s CFO Indicator highlights the DNA of the modern CFO:

Carefully Monitor the Global Landscape: Modern CFOs are expected to identify key economic risks and business opportunities. The survey reveals that CFOs keep a close eye on international trends that influence their business:

  • CFOs indicate that infectious diseases (43 percent), severe weather (31 percent) and global political unrest (30 percent) pose the top financial risks in today’s economy.
  • Over half (54 percent) anticipate capital expenditures to increase and 45 percent predict global issues regarding taxes and spending will escalate in 2015.
  • Forty-four percent of CFOs predict global economic instability will negatively impact US markets.

Rely on Data Analytics to Make Strategic Business Decisions: The Adaptive CFO Indicator found that today’s CFOs rely heavily on data analytics to meet their evolving demands as a strategic partner:

  • Nearly 70 percent rank data-based insights as the top influence on strategic business decisions.
  • Forty percent consider the ability to leverage analytics to make data-driven decisions as one of their most required skills.

According to a report by McKinsey&Company, the power of data and analytics is profoundly altering the business landscape. Companies striving to stay competitive need to enlist more top-management muscle to leverage available data and create overall business value to stay competitive in the market.

Value Strategic Forecasting as a Competitive Edge: The demands on and responsibilities of a modern CFO require a heightened level of strategic decision making and financial forecasting in order to drive business advantage.

  • Forty-three percent of CFOs identified a desire to make financial forecasting and planning the strategic backbone of their overall business.
  • Approximately half (49 percent) desire 360-degree competitive visibility to improve business decisions and nearly 30 percent plan to improve forecasting capabilities through financial planning solutions.
  • Over half of CFOs are expanding their team’s primary functions from number crunching to also include strategic analysis (55 percent). This is an even higher priority for CFOs at $1B+ revenue companies (70 percent).

Innovate With Cloud Technology: Cloud adoption among CFOs is an increasing trend.

  • CFOs report cloud solutions increase collaboration (25 percent) and reduce dependence on IT (24 percent), improving analysis of global market fluctuations through access to real-time data.
  • Fifty percent validate the strategic value of cloud software stating they would consider trading Excel for cloud-based solutions.

Wear Multiple Hats: CFOs are prepared to step into multiple roles. From crisis control to global market management, modern CFOs embrace a broader span of responsibilities:

  • The majority of CFOs (76 percent) see themselves as a “navigator,” well equipped to guide their finance teams through fluctuating economic conditions.
  • Sixty-three percent are adept at crisis management, while 52 percent act as “firefighter” or “traffic cop” (52 percent).
  • Thirty-eight percent at the largest corporations ($1B+ revenue) also see themselves as the corporate “weatherman,” monitoring the economic climate and its impact on the business.

About the Adaptive Insights CFO Indicator

The Adaptive Insights CFO Indicator reports what is top of mind for CFOs, as well as unveils key attributes that define the modern CFO. Following the release of this Q1 2015 CFO Indicator, Adaptive Insights will be issuing a series of Indicator Briefs, providing deeper CFO insight into global, economic and technology trends. This report surveyed more than 250 chief financial officers online over a period of three weeks ending January 6, 2015. The margin of error is +/- 6.04 percentage points.

 

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