Data-driven initiatives continue to dominate, regardless of industry. Many times, organizations collect as much data as they can, but are unsure how to turn that into significant insights that can drive successful business decisions.
In the finance department, data is even more important—detailed analytics on where customers are coming from, what the Customer Acquisition Cost is, or how profitable each customer is can be monumental when analyzed properly.
So how do organizations ensure that they’re getting the most out of their financial data?
Systematize Trends Over Time
Performing ad-hoc analysis provides value; but this process misses out on opportunities to learn what the organization is doing right and what they’re doing wrong.
Instead, consider analyzing trends over time to realize the full potential of all that data. This way, you can use that data to tell a story about your company over time, which is extremely valuable for businesses seeking funding from investors.
Hire the right people
Like all departments, each member of an organization’s finance department have specific roles. The specific makeup of a finance department depends on what the business needs—do they need more analytical horsepower or just someone to come in and audit the books?
Understanding when a full-time employee is necessary and when to hire on-demand professionals for a quick project can save thousands for the business.
Implement the right tools
As businesses increase the amount of data they’re tracking, all the statistics can be overwhelming without the right reporting tools. Thankfully, business intelligence tools empower organizations to understand data quickly, allowing them to adjust their business decisions in a timely manner.
In response to the increased importance of data collection, BI tools have matured to allow companies to slice and dice data in numerous ways with a few quick clicks, allowing companies to get more from data while improving immediate projects and long-term prospects.
Understand what data to focus on
With the wealth of data at your fingertips, it can be hard to know which pieces are the most relevant to measuring business goals.
Though each organization has its unique needs, the following metrics can apply to businesses of any industry:
- Customer Acquisition Cost : Lifetime Value (CAC:LTV)
- Gross Margin
- Net Income
Understanding those metrics and what story it tells about your business is important while business continues to grow.