Let’s play a game of two truths and a lie. Out of these three statements, which two do you think are true and which one is a lie?:
If there is a job synonymous with numbers and data, it’s finance and accounting so you’d be forgiven for thinking that those working in these roles are, by extension, data literate – with the ability to read, work with, analyze and communicate with data. In fact, this is the lie. There is a very big difference between reporting on data and taking informed action using the insights data can provide.
What is true is that data is already transforming the finance function – three quarters of those working in the finance department report that they regularly review and use data to inform decisions about what action to take, with a similar number believing using data in their role enables them to do their job better. Despite this – and the other truth - more than half believe their employer is failing to prepare them for a more data-oriented and automated workplace.
In this blog, I want to take a closer look at this disparity between the opportunity that data offers, and the investment needed to make sure teams have the data literacy skills to fulfil it.
The role of finance is changing. The speed at which businesses must operate today means that the finance team are in the hot seat to help drive efficiencies and insights into business performance, and measure and improve returns on digital investments and business bets.
To do this, they need to move away from the dependence on historical data and static quarterly and yearly forecasts, to become real-time, delivering up-to-date information designed to trigger immediate actions when they matter most – what we call Active Intelligence. In practice, for example, it allows finance professionals to accurately compare forecasting with actuals in real-time for ongoing trend analysis.
The shift is already happening – 75% of people working within finance and accounts departments say they regularly review and use data to inform their decisions about what action to take. But 59% also say that they frequently make decisions based on gut feel, rather than data-led insight. For finance teams and consequently, their employer to thrive, more investment needs to be made in increasing data literacy.
The appetite is there – 69% would like to become more data literate, with 74% saying it is necessary to fulfil their current job role. That said, only 34% have had formal data literacy training with hands-on exercises. To make the most of the advantages that Active Intelligence can offer, businesses need to equip their finance team with the knowledge and skills to work with data effectively – to feel empowered by data to drive decisions and help their organization become truly data driven.
And it’s not just about where the finance team are today but it’s about investing in them for tomorrow. 69% believe data literacy will help them stay relevant in their role with the growing use of technology, be more successful in their career (70%) and open up more professional opportunities (69%).
Faith Vakil, Director of Research, Gartner Finance, recently said, “the pandemic exposed budgeting and forecasting processes that were not able to handle rapid and unpredictable changes in operating conditions”. While the world may be slowly getting back to normal, rapid change will remain a constant. Now is the time to invest in upskilling and training finance teams to be more confident, creative and impactful with data.
To uncover more findings from our most recent global study, Data Literacy: The Upskilling Evolution, download the report here.