Despite the increasing expectation for CFOs to act as strategic business partners, research shows that most have insufficient information for optimal decision-making. The rising importance of extending FP&A principles outside of finance (referred to by Gartner as xP&A) creates the need to include operational data from numerous departments to guide informed decisions. Yet, according to one survey by FSN, a third of CFOs still rely on gut feel rather than data. Another report by FP&A Trends highlighted that only 26% of FP&A effort is spent on higher-value activities such as insight generation and decision-making support. Luckily help is at hand, with the emergence of Decision-Making Platforms as a valuable tool to help CFOs develop data-driven business strategies. 

What decision-making challenges do CFOs face? 

Modern decision-making is complex. Truly informed decisions require complete visibility of strategic, financial, and operational data, and the volume of this data is ever-increasing. As a result, CFOs face several challenges when trying to provide strategic guidance to the organization:  

• Siloed data – Financial data is likely to be stored in several disconnected systems and spreadsheets, making it time-consuming to consolidate and gather accurate insights for decision-making. This challenge increases when factoring in strategic and operational data stored in yet more disparate locations. Manually combining the different sources and formats of this information and checking its accuracy takes valuable time, which could be better spent on higher-value tasks.  
• Lack of organization-wide visibility – Informed decision-making requires complete visibility of activities across all teams, such as understanding how a new strategy will impact operational capacity. The correlation between a decision in one business area and its impact on another can only truly be understood when data is seamlessly connected to enable easy comparison. It cannot be achieved with a patchwork of spreadsheets and systems. 
• Lack of a unified decision-making environment – As FSN highlighted, almost a third of CFOs’ decisions are made based on gut feel, and many more are made based solely on historical data. Disconnected budgeting, planning, and forecasting tools (including spreadsheets) make it extremely difficult to generate the wide-ranging insights needed for an informed decision. Exporting and importing data from one system to another or juggling multiple windows with different graphs, charts, and plans makes it extremely difficult to come to a quick conclusion. CFOs need a single platform they can use to support decision-making at all levels.  

What is a Decision-Making Platform?  

A Decision-Making Platform (DMP) aids strategic, financial, and operational decision-making within an organization by combining business intelligence, planning, and predictive analytics capabilities with a single, accurate view of corporate data. Using a DMP, people can quickly analyze historical performance and use it to plan and forecast future activities, gaining real-time visibility of their potential impact on the entire organization. 

Why CFOs need Decision-Making Platforms 

Complete alignment between strategy, finance, and operations – provided by a DMP – empowers CFOs to become data-driven business partners. The provision of real-time information on everything from strategic goals to operational output – and every correlation in between – creates an immediate, consistent understanding of what truly drives the bottom line. The same data can be leveraged for planning, forecasting, and scenario modeling, enabling instant feedback on the impact of different strategies and initiatives for informed decisions. 

Discover more on this topic in our free eBook, A CFO’s Guide to Decision-Making Platforms, which explores the importance of a DMP in modern decision-making, ten key features of a robust Decision-Making Platform, and critical success factors for implementing one.