How visibility and access to real-time data is impacting confidence
A new survey by researching firm Censuswide discovered that nearly 70% of global business and finance executives lack confidence in data. The survey of C-suite executives and F&A professionals commissioned by automation software business BlackLine discovered that under 30% of respondents are confident that the financial data they use for financial analysis and forecasting is accurate, despite a further 30% claiming they are under more pressure to present more accurate findings of performance due to the pandemic.
The study of 1,300 business leaders spanning seven markets (US, Canada, UK, Germany, France, Singapore and Australia) focused on the impact of the pandemic on a random selection of various global organisations. The results suggest that while businesses appreciate the important role financial data plays in managing business strategy and continuity, the lack of visibility and access to real-time data is impacting businesses ability to respond effectively to volatile changes in the market. When asked about the impact the pandemic has had on their business, over 40% stated that their business had become more focused on financial scenario planning and stress testing due to the ongoing impacts of Covid-19. A similar proportion also stated that F&A is becoming more popular by senior members to support scenario planning, indicating the importance of financial insights in moving towards a stage of recovery.
The findings also suggested that nearly 30% of respondents are concerned that their F&A teams are not able to generate data quickly enough for their business to respond to the constant changes in the market. A combination of remote and office-based working conditions could make this even more complicated. Over 25% of respondents indicated that hybrid working models will make it more challenging for F&A teams to work together and suggest it could lead to potential inaccuracies in financial data.
Additionally, over a quarter of C-suite executives believe that they have little or no visibility into financial scenario planning or stress testing at their business, suggesting that some leaders could be making decisions based on inaccurate or incomplete information on the financial health of their business. This lack of visibility is hindering the trust in data used for vital financial processes and planning, particularly with C-suite leaders. Just over 50% of C-level executives are completely confident in the accuracy of their financial data, compared to 71% back in 2018. When F&A professionals were asked the same question, only 30% stated they were confident in the accuracy of their financial data, compared to 38% in 2018.
The main reason for this lack of trust was mainly due to the continued reliance on traditional spreadsheets and using dated processes that result in F&A teams with little visibility until the month-end. Some respondents pointed out that the problem has increased since 2018, suggesting the transition towards digital systems in F&A still needed work. Marc Huffman, the CEO of Blackline explains that aside from the impacts on our health and wellbeing, the pandemic has continued to impact businesses across the globe.
As things progress, businesses need to rethink and readjust their operations and ensure they are ready for possible outcomes, applying solid and reliable data to enable quick and intelligent decisions. Huffman emphasises that the businesses capable of doing this will be in a better plan to progress over the next few months. Huffman believes that many businesses are struggling with visibility and access to real-time financial data, yet there is a consensus that needs to change. The study indicates that business leaders understand the value of having reliable and accurate financial information and are ready to take action.
The results show that the pandemic has developed a heightened urgency concerning digital transformation and added investment in technology. Over 30% of respondents surveyed stated that the developments in the last year have made people appreciate real-time access to financial data. When focusing on best practices and remaining competitive, technology that allows better management and visibility over financial data has a critical role to play. Over 30% stated that investing in data analytics will support their business in retaining a competitive edge and a similar number are exploring options of automation solutions to improve the accuracy and the reliability of their financial data.