As a CFO, you need to be able to accurately predict what your cash flow will be — over the next week, month or even year — so you can take the right financial decisions to keep the business running smoothly and to secure its future. Yet in the current economic environment, it's harder than ever to model cash flow correctly.
- Revenue streams have become more unpredictable — with some even drying up altogether — thanks to factors such as global supply chain issues, turmoil in the energy markets and changes in customer behaviour prompted by the COVID-19 pandemic.
- Staffing costs and related expenses have become more uncertain, as a result of labour shortages and changes in government policy in areas like national insurance.
- Supply chain partners are taking a hard look at their terms and conditions and increasingly looking to negotiate payment holidays, extended terms and options for revised payments. You need to understand the impact whether you're the one asking for a change or on the receiving end of those requests.
- A bewildering array of government support schemes and grants have sprung up, but it can be hard to tell if it's worth the time and effort to apply and what impact a particular scheme will have in both the short and long term.
Many CFOs struggle to pull together the necessary data to fully understand the current situation, let alone carry out a wide enough range of what-if modelling to be able to find the best answers to their specific dilemmas. If you're like most CFOs, you're probably having to look at multiple systems, manually fetch data from different places to load into your own spreadsheets and wait too long for the analysis to be completer.
A new generation of modern, cloud-based data analytics solution can change all that.
These solutions make it easier for you to:
1. Collect, combine and work with all your data in one place
With all your data in one place, you can more quickly and easily access the data you need, no matter what question you want to ask. You don't need to spend time pulling data out of different systems and getting it into in shape before you can use it. You don't need to worry about whether you're working with the latest data. And you don't need to move your data somewhere else — such as into a spreadsheet or a reporting tool — before you can run your analysis.
2. Handle large amounts of data — at speed
Cloud-based data analytics solutions can store millions of gigabytes of data, run complex queries across large subsets of your data in seconds, and automatically and instantly scale as you add more data. That means you can get the answers you need quickly and you don't need to switch to another system if you want to ask a different kind of question.
3. Import, clean and transform data — automatically and reliably
The answers you get from your cash flow analysis are only ever as good as the data you use. But data straight from the source isn't always in the best shape. A data analytics solution provides you with tools to not only quickly and easily connect to the data you need and refresh it as often as necessary but will also help you get it in the right shape to work with. It will also make it easier to combine data from different systems so you can build a complete picture of your interactions with each customer or supplier and see the true impact of changes in your relationship with them.
4. Use advanced analytics to take your cash flow analysis to the next level
Advanced analytics based on machine learning — a kind of artificial intelligence — will allow you to get even more value out of your data. Using these techniques, CFOs can predict the impact of rapidly fluctuating costs, understand how to optimise your use of different financing options or uncover hidden patterns in your data. Yet even a few years ago, using advanced analytics to answer these kinds of these questions was out of reach of all but the largest organisations. A new generation of tools is allowing teams with limited machine learning expertise to build sophisticated applications to address these questions, but good results still depend on having high quality data and lots of fast and powerful computing resources. So a modern data analytics solution is an essential foundation if you want to take your financial planning to the next level.
5. Provide actionable insights to drive decision making
All the data and technology in the world won't help if you can't get actionable insights when you need them. A modern data analytics solution will include tools that allow you to visualise your data in ways that go beyond traditional tabular reports and charts, while providing fast and responsive reporting no matter how much data you're working with.
6. A simpler route to modern data analytics
The benefits of a modern data analytics solution are clear — but deploying one can seem a daunting prospect. That's why we've put together our CFOLab solution. It makes it easy to bring together your data, analyse it and then report on it through engaging dashboards that give you timely, actionable insights into your future cashflow and daily inflows and outflows.
Supported by our consulting services, CFOLab already offers connectors for common finance, ERP and other business systems, along with a set of standard reports, so we can get you up and running with advanced analytics in days. We can help you link to new data sources in hours and provide additional analytics and reports if your business has specific cashflow needs, such as managing inventory and working capital.
Get in touch with our Data, Analytics and AI team to find out more.
Working with our data analytics and AI team
Our Data, Analytics and AI practice brings together a highly committed team of experienced data scientists, mathematicians and engineers. We pride ourselves in collaborating with and empowering client teams to deliver leading-edge data analytics and machine learning solutions on the Google Cloud Platform.
We operate at the edge of modern data warehousing, machine learning and AI, regularly participating in Google Cloud alpha programs to trial new products and features and to future-proof our client solutions.
We have support from an in-house, award winning application development practice to deliver embedded analytics incorporating beautifully designed UIs. We are leaders in geospatial data and one of the first companies globally to achieve the Google Cloud Location-based Services specialisation.
If you'd like to find out more about how we can help you build your own modern data and analytics platform, why not take a look at some of our customer stories or browse our resources. Needless to say, please get in touch with our team if you'd like more practical support and guidance.