In this episode of the Business Excelleration® Podcast, how can finance can more effectively navigate the high levels of uncertainty and risk in today’s business environment? A discussion with The Hackett Group Senior Director, Finance Executive Advisory Shawn Fitzgerald, Digital Enablement Principal Justin Gillespie and Director, Finance Transformation Anthony Relvas.
Welcome to The Hackett Group’s “Business Excelleration Podcast,” where week after week we hear from experts on how to avoid obstacles, manage detours and celebrate milestones on the journey to world-class performance. This episode is hosted by Shawn Fitzgerald, senior research director at The Hackett Group. Today’s episode will discuss how finance and other parts of an organization can thrive during these unprecedented times. He is joined by Justin Gillespie, Digital Enablement principal at The Hackett Group, and Anthony Relvas, director of the Finance Transformation practice.
To begin, Shawn defines uncertainty as an unknown risk. Companies are facing uncertainty not because the challenges are unique, but because so many of them are happening simultaneously. These include inflation, environmental risk, marketplace risk, geopolitical instability, technology advancements and more. From our research at The Hackett Group, we know that Digital World Class® companies are better at managing these risks.
Then, Tony and Justin explain what organizations can do in their approach to forecasting and analytics to best categorize, mitigate, and manage risk most effectively. The biggest step is to know your business and create a driver-based model with that information. Some companies may not truly understand what is driving revenue and cost. Hear the differences between an advanced data and analytics model compared to a traditional finance forecast. Most companies are recognizing the necessity of having a dedicated and knowledgeable data scientist on the team. Listeners are reminded that if they are always waiting around for the perfect data, they will likely never get to that point of action.
When it comes to thinking about and approaching data, your answers are not going to be precise. However, the data quality should be good enough that you are not misled with bad inferences. Data quality is a constant and lifelong journey you must implement within the organization. As you go deeper into the refinement process, new ideas will likely begin to emerge. For listeners who are interested in getting started on their own advanced analytics processes, our guests offer their best advice. As we have already stated, the first step is to understand how and where you make money and create a mathematical model. It is important to understand past history. Next is understanding your skill sets and making sure you are acquiring the best skills and talent through hiring and upskilling. Breaking down the silos and bringing data together in a democratized way into a modern data architecture is another key step. Analytics needs to become as important as air for an organization – a corporate priority set from the top.
Before wrapping up, hear how The Hackett Group delivers on their partner competencies for these advanced analytics to help companies. There are all kinds of market offerings in place to help clients address different competencies in this particular space. They also offer advanced analytics and forecasting capabilities to work alongside clients taking the first steps to creating new predictive models. The Hackett Group has been in this space for five years.
- 0:49 – Welcome to this episode hosted by Shawn Fitzgerald.
- 1:40 – How to define uncertainty.
- 3:12 – How to approach forecasting and analytics to mitigate risk.
- 6:23 – The differences in advanced analytics vs. traditional finance reports.
- 9:40 – How to think about and approach data.
- 13:30 – How to get started in advanced analytics.
- 19:55 – How The Hackett Group delivers on partner competencies for advanced analytics.