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Want data? Don’t ask finance

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9th Aug 2011
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One would think that if someone within an enterprise wanted data – good data; real data; useful and trustworthy data – they’d go to the finance or accounting functions to get it, explains Leslie L. Kossoff.

One would be wrong.

There are two reasons for that. The first is that finance functions tend to treat the data they collect as if the data has the highest top secret clearance any government could ever give. Or even imagine.

The second is because the data that you provide isn’t usually as useful as you think it is – or as the folks who want it need.

Which brings us to marketing and sales.

The Accessible Data Question

Ask a sales person what their commission is at any point during any given quarter and they will most likely be able to give you an almost to-the-penny answer. The correct one, too.

That’s because in the sales department, the data they’re collecting translates into money in their pocket. There’s nothing more real than that.

Now let’s put marketing into the mix. With the changes in how business does business these days, marketing departments – which used to get away with “feel good” numbers – don’t anymore.

It’s all about clicks and conversions. It’s foot traffic and how that converts to sales per square foot. 

Or sales per employee

Pie charts and spreadsheets aren’t just pretty (and not so pretty) pictures of how much of the market any particular organisation holds or what their productivity numbers are any longer. Now, they’re part of a world of trend data that has become so commoditised by the various analytics providers that no boss is or ever should be satisfied with whatever data is presented.

Because there’s always more.

And it’s all accessible. You just have to know where to look and how to present it.

The value-add finance function

So, let’s go back to the data you’re protecting with your life.

First of all, yes, some of it is proprietary and needs to be kept confidential. That being said, however, you’d be surprised at how much you can share that you’re not.

And that’s how finance becomes value-add and gains a far more integral seat at the table.

You guys are the numbers guys. You love them. You understand them. You practically commune with them on some strange, existential level.

Well, it’s time to share. Only when you do so, it’s time to look at how some of the best of breed have figured out how to get this data across to a world that has no finance or numbers background at all.

Like Google Analytics. Or, also within Google’s walls, the Feedburner service. Or in the social media and networking sphere, AddThis.

Because what these guys are doing is providing immediately understandable and usable data to bloggers, and small and mid-sized business owners in the ether as well as in the bricks and mortar world in a form and format that they can understand.

More importantly, because they present the data the way they do, their users can ask better questions and make better decisions – immediately – than they could before.

That’s what you need to be doing too. Only within your own context. Otherwise, frankly, you can keep your top secret status. No one can figure out how to use what you’re giving them anyway.

It’s not that your data isn’t useful. It is. Critically. So are you.

It’s simply time to change how you present your message – which we’ll take on in the next post.

In the meantime…

Questions? Problems? Concerns? Arguments? 

I want to hear them all. So do you. Because this is all about your success – and we’re going to get you there.

Over the coming weeks we’ll be publishing a series of articles written by Leslie L. Kossoff that focus on FDs, CFOs and managers.

Further reading:

Leslie L Kossoff is the author of From Lean Start-Up to Six Sigma Turnaround: 7 Steps To Your Success. She can be contacted at [email protected].

Replies (5)

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By rayhelmke
16th Aug 2011 13:36

why

without trying to sound rude - what was the point in this article?

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By hgarrett
16th Aug 2011 15:04

why why

 

My experiences are that Marketing and Sales types tend to Skew date to their benefit. Where as Finance presents data according to the organizations structure.

 

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By [email protected]
16th Aug 2011 17:02

I think Leslie is tryng to make the case that financial needs to be more widely available, more timely and more dynamic.

My experience of the point aqbove is that everyone uses data to support their perspectives on the wolrd (just look at politicians!) and usually finance are the most objective, hence I prefer their take on the data.

There is an argument for 'democratising' the access the data in the organisation but its not just about trending data, its about providing 'just enough' detail at an exception level, continuously, consistently and completely

Interested to see where the second part of this article goes . . .

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By Blue Osprey
16th Aug 2011 18:13

Maybe it's your approach and attitude

Leslie,

Your article would indicate that you have had numerous bad experiences with Finance Departments and or run ins with many finance leaders, which is sad but surprising that it should lead a person of your apparent background (Lean Specialist) to come to such a conclusion without providing empirical research data to support your prognosis that somehow finance people in general are universally secretive. I know I could be accused of showing bias here as I am an accounting professional but in my experience (over 30 years across a variety of industries) I cannot reconcile your thought process with the one that is sacred to your cause. i.e. finding the root cause and putting in sustainable and permanent corrective actions but in doing so do not confuse symptoms with cause. You have either only experienced a lot of closed minded finance professionals or are extrapolating from a small sample and reaching an inaccurate conclusion. Believe me, we accountants are not all the same.

If what you are trying to do with this article and series of articles is to highlight and create debate on the poor levels of intelligent data gathering, its presentation and practical use as it would apply to any given scenario I would wholeheartedly agree with you, but would argue that it is a universal problem in business and life in general and far from being the sole domain of Finance or even endemic as you suggest.

The answer lies in striking a sensible balance which will be different in each circumstance. Some situations may require more detailed analysis or checks than others but what Businesses and people start with is either too little or too much. Or worse still no clue or understanding why they are doing it. Your article suggests you are experiencing the too little and too confusing line but not clear enough to suggest you understand the consequences of too much or inappropriate.

In terms of too little the typical causes surround, naivety, inexperience, low awareness, secrecy, poor systems, badly designed systems, poor processes, badly designed processes, laziness, too much success, lack of competition, too big, and familiarity (you need to have worked in this industry to get a job here stupidity). Conversely some of the same causes can result in too much data/information and as examples I would add over-thinking the problem, too much enthusiasm, poorly guided, absence of logic & structure.

Too much data/information can be just as destructive as too little as last week's trouble so eloquently displayed. The Police were slow to speak with the bereaved family and even when they did were guarded in their explanation. The looters spread their messages by social media many of which no doubt were fuelled by rumours and speculation. And even this week we have Shell downplaying the oil spill which has now unsurprisingly got bigger. Some serious chaos and in both cases not an accountant in sight!

There are two sayings that a fond mentor of mine (an engineer by the way) would quote

1. Paralysis by Analysis

2. With Confusion there's opportunity

If people do manage to reach a sensible balance they then need to decide priorities format, structure, reconciliation and meaning which is a whole subject on its own so I will not go there suffice to say that if you are dealing with closed minds your screwed and if I were you I would leave them to their fate. But I would argue you have been unlucky as the majority of accountants I believe just do as the majority of employees do and that is try and do their best and will be more than happy to make compromises and adjustments assuming the logic is sound. If you actually create and promote the proper environment people will naturally find the most efficient method. It takes a lot of courage and faith and more often than not it is usually the longest fix but generated the biggest return. I would also argue that Finance are equally the ones promoting change and improvement. I could also quote you numerous examples where operational and commercial people claim to have made savings or generated profits in excess of any sensible monetary level and not even had the common sense to sanity check their conclusions nor the decency to involve the finance department. But I have never made a rant out of it. Just simply agreed to sit down and go through it logically and if it points to an improvement needed on my part I go and make it happen as I would expect of them. Honour and respect they call it.

When you do come across an accountant who you suspect of being secretive on data that is not inherently personal such as payroll where he or she may be entitled to restrict access then you have to be patient and find another way. Start by making sure they are part of the project and hence will share in the success and if they are not in possession of at least a Six Sigma Yellow Belt certificate insist that they are trained. Unfortunately one business function can bullshit just as much as another so other than complaining to their boss, you just need to get creative if finance become a bottle neck. Unfortunately you may need to know your way around a finance department and have the ability to rationalise and reconcile the missing bits. It's like a giant jigsaw puzzle. Complete it bit by bit and just keep taking away the excuses and they will have no where to go and peer pressure will take care of the rest. I am not sure how much accountancy experience you have but if I were you I would seek out some training or guidance you can rely on. And a word of warning if you are in a business and the finance department especially the accounts payable department looks as if a bomb has hit it then if you do stick around insist that you are paid either upfront or paid within 7 days.

And yes in the same vein Accountants should be looking at the techniques surrounding continuous improvement and changes in the environment such as the rise of technology social media etc. I am an accountant but I hold a Six Sigma Yellow Belt which no one told me or even suggested to me to get. I recognised a gap and filled it. I do not need to be an expert but it helps. I also possess a passion for IT and all bits that go with it. Again I am no expert but I have a level of understanding that helps and I have always been the mover and shaker in that regard in any company I have been in.

I also detect a level of frustration on your part towards my profession and to be fair I share the same feelings at times probably even worse as I know how it can be and should be but at times it is probably not any better in yours.

If you adopt the right empathic, patient and logical approach you will be successful either directly with the bottleneck person or through others.  

I will end by suggesting that rather than come on here and have go at Accountants (which may have been your intention in some perverse notion that it was your idea of a professional way to deal with this subject) just simply pose the question

Are accountants through their methods of collection, recording, analysis and favoured distribution channels providing the necessary transparency to key business activities so that users can easily understand and make use of to improve those activities?

or more usefully post this question on every profession's website including your own and ask

Are you as an individual or as part of your various groups and networks doing the best you can to the best of your ability at all times and helping others to do their best all in a manner that promotes, empathy, understanding, transparency and support in accordance with acceptable moral behaviour.

If you are going to blog and level criticism on a specific group of people about sharing information pick on the ones who we all know cannot truthfully answer Yes to the second question.

regards

Alastair Murdoch FCMA

 

 

 

 

 

 

 

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By antjames
18th Aug 2011 13:39

I totally concur with Alistair, I have worked both in practice and now industry, and in my experience finance actually holds the most accurate and realiable information. Unfortuately sales/marketing fail to appreciate the costs involved and are only interested in their commissions/salary payments.  They have no appreciation of the other costs, such as back office support costs, tax costs, other costs.

 

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