If your livelihood is in the area of financial data, you may too often feel like you’re living in a world that is data-rich, but intelligence-poor.
It’s not the people, mind you, that are the problem, but the data itself.
Finance departments everywhere are filled with spreadsheets crammed with formulas, KPIs, metrics, and numbers. This results in a data overload from which we rarely realize valuable insights.
In this age of endless information via financial feeds and data feed software, it’s easy to confuse having data with making the best use of that data. And it’s even easier to confuse knowledge with intelligence. Too often we fall into the trap of believing that deeper, more complex spreadsheets and reports provide the actual value.
But more isn’t always better, and data for data’s sake isn’t the answer. Instead, usable data provide the path to business intelligence.
Information vs. Insight
Ariella Tenuta, director of financial planning and analysis at Dreamworks Animation, argued at a recent FP&A Innovation Summit that FP&A professionals should aim to provide insights, and that synthesizing information across the organization is critical to providing actionable recommendations.
That’s where data visualizations can truly change how finance operates and provides value. By stealing a page from graphic design, we can use visuals to tell stories in a more compelling, more digestible format.
It’s time to turn this:
Centralized truths: Live visualizations linked to data warehouses can act as a central locus for insights. They can be viewed by the analyst and executive alike, and eliminate miscommunication. Charts are a language everyone can speak, and typically agree upon.
Intricacies exposed: Have you ever looked for the insight buried in a spreadsheet of data? It’s much simpler to see outliers or correlations in visual trends than to comb a spreadsheet.
The signal from the noise: For every 1000-row spreadsheet, there are hundreds of rows that contain nothing but background data. If just thinking about that gives you a headache, you're not alone. Data visualizations offer a much faster and more appealing read, and can get to the crux of the story quickly.
Storytelling is the goal: Executive teams can make better decisions when they know the whole story - the context - behind an insight. These stories are best told quickly, with a narrative that’s backed by a visual display of information, trends and correlations.
For example, knowledge tells you that your competitors spent $10 million on research and development last year. Intelligence tells you that this spend cut into their overall margin, and acquisition might be the better road to innovation.
While technology has made it possible to know anything and everything, knowing something isn’t as important as knowing what to do next. Data visualization turns knowledge into intelligence. And it makes the value that the finance department can provide even more fundamental to the strategic direction of a company.
For more infomation, download our data sheet.