In this, the third of four articles, we shall do a deeper exploration of the Mindset which is one of the four components in the analytics culture described in the second article (Mindset, People, Process, Systems). Mindset is the “start button” for how to advance towards a world class strategic partner, meaning without the right Mindset don’t even thinking about a world class aspiration.
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The Finance group is the bedrock of a business. It offers control and on-going financial measurement to assist defining and meeting plan – It is the trusted score-keeper. However, this should only be a stepping-stone to the broader value Finance can bring to its business if it aspires to be world class and become the strategic partner to the business.
Going from trusted score-keeper to strategic partner begins with an aspirational Mindset on how Finance perceives its contribution to the business’ decisions. The trusted-scorekeeper focus is on reporting numbers timely and accurately to the business and do basic variance analysis commentary. The strategic partner use data to provide analytical insight to influence decision makers and impact the strategic direction for the business.
As presented on the figure below, the path from the back office focused trusted score-keeper to the front line facing strategic partner goes through four types of personas: Reporter, Commentator, Advisor, and Strategist. The journey involves understanding how to innovate Finance by improving the analytical skill set and systems toolbox to provide deeper and predictive information.
The Reporter supports the business by providing reports containing hindsight information. This Persona has demonstrated expertise with spreadsheets and spends much time capturing data from different BI data cubes/spreadsheets/transactional sources to consolidate into other spreadsheets. The Reporters are focused on providing the business with timely, accurate, and accessible financial information.
The Commentator adds visualization to reporting to explain trends and movements in the performance. This persona has automated the standard reporting by using Center of Excellence thinking and data visualization tools. The Commentator contributes by turning data into information beyond high-level variance analysis through detail explanation of the historical trends and deviations.
The Advisor identifies issues and opportunities by using complete knowledge of internal data, competitors, and the market to provide insight to business leaders that influence their decision making. Insight is information that the business does not know; e.g. correlating between the current performance and other financial or non-financial data, statistical distributions of data or clusters in data. The Advisor often use multi-source data and analytics to explain why things have happened and not just what and where things happened.
The Strategist impact business decisions, as the Strategist is capable of generating the most advanced forms of analytics; e.g. predictive and prescriptive analytics to explain what is likely to happen and how to make it happen. Strategist use analytics tools combined with a detailed understand of competitors, customers, and vendor’s strength and weaknesses and use that insight to predict future events and performance.
Finance organizations that understand how to advance through the four personas are said to be on the journey towards world class strategic partners. Note, if Finance only understand how to operate as a Strategist but cannot get the Reporter persona perfected it will not have a persona as a Strategist. As an example, a business leader will not trust the powerful prediction from Finance (Strategist) if Finance cannot report historical information timely, accurate and accessible (Reporter).
The only way to become a Strategist is to work through each of the persona one at a time starting with the Reporter. When having perfected the Reporter move on and nail down the Commentator, the Advisor to finally achieve the Strategist. Finance perfecting all four personas operates as a world class strategic partner to the business.
In the last article in this article series, we turn our focus towards an empirical study describing where Finance is today in its journey towards becoming a world class strategic partnering.
If you are interested in the different Mindsets and how they contribute to become World Class Strategic Partners then join us at the Analytics Academy in San Diego from September 18-19th 2019.
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The original article was posted on LinkedIn: https://www.linkedin.com/pulse/mindset-start-button-world-class-strategic-jesper-hybholt-sorensen/
This article is a collaboration between Robert J Zwerling and Jesper H Sorensen from the organization Finance Analytics Institute (www.fainstitute.com) and is an excerpt from their book, Implementing an Analytics Culture for Data Driven Decisions – A Manifesto for Next Generation Finance. Robert and Jesper are the content creators behind the Analytics Academy and will teaching at the Academy in September!
Copyright 2019 Finance Analytics Institute, Robert J Zwerling & Jesper H Sorensen. All rights reserved. No part of this document may be reproduced without this copyright notice.