‘Management accountants can be the glue that binds all the pieces of the puzzle together’
If you’re not familiar with terms such as ‘Hadoop’, ‘predictive analytics’ and ‘data visualisation’, you soon will be.
The new discussion topic is ‘turning data into insight’ and we’ll not only be getting to grips with the jargon of this new wave of technology; we’ll also be demonstrating how CGMAs have the potential to play a key role in turning information into a business advantage.
Industry experts have predicted that big data can provide some big strategic gains for the businesses that use it. But, if enterprises are to be in the right position to capitalise from this development, they need to ensure that they have established a coherent data strategy that is backed by multi-disciplinary teams.
A forthcoming CGMA research report on the subject will explore how management accountants can co-operate with IT professionals, data scientists and business leaders to create a strategy that extracts value from data assets more effectively.
Indeed, given the right conditions, management accountants can be the glue that binds all the pieces of the puzzle together. Their discipline in working with data, combined with their commercial knowledge and ability to translate interesting new insights into a competitive advantage, will become increasingly important as organisations grasp the opportunities created by big data and related trends.
But this does not mean that financial managers need to become specialists in advanced analytics. Undoubtedly, it will be the data scientists who will develop the algorithms that enable the data to be sifted and analysed in new ways.
Where finance adds real value is in helping organisations to apply those insights to achieve the right outcomes for the business. In a commercial environment that continues to develop rapidly, and where growth is still hard won, such skills are at a premium.
Under these circumstances, organisations need a keen understanding of the factors that affect cost, risk and value across their business models if they are to improve their performance.
They not only need better management information; they also need the tools, key performance indicators and strategies to apply these new insights for commercial advantage. It is in this realm that management accountants can excel.
In its research the institute has looked at how companies are converting data into insight and, in turn, insight into commercial advantage.
We are confident that CGMAs can provide the missing link in relating insights derived from data analytics back to the fundamental drivers of performance.
In fact, our research has discovered that management accountants are already helping their organisations to make better use of their data assets.
Some are using new data sources to enhance enterprise risk management; others are using better data skills to innovate in managing performance and key performance indicators.
Grasping these opportunities will stretch traditional management accounting skills into new areas. It will necessitate stepping beyond the familiar world of financial data, working more collaboratively and drawing on the ability to guide and influence other stakeholders throughout this process.
But there is enormous potential for financial managers to catch the big data wave and apply traditional management accounting skills in a completely new and, many would say, very exciting environment. I predict that, in the very near future, we’ll all be able to distinguish our hammocks from our Hadoops.
Illustration: Masao Yamazaki/Dutch Uncle
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