CFO Insights: Best Practices For Building Ownership in Data Hygiene and Governance

At FinQore, we have been hosting our quarterly CFO Roundtable events with the goal to provide finance leaders with a safe space to engage in candid discussions on pressing industry issues as well as the latest trends and challenges shaping the finance function.

At our recent CFO Roundtable in Boston we had an insightful discussion on the crucial role of the office of the CFO in maintaining data hygiene, data governance, and establishing a single source of finance truth within organizations. Here are the key takeaways and strategies shared by financial leaders during this engaging event.

Key Takeaways

One of the most significant insights from the roundtable was the importance of cultivating buy-in on data hygiene across the organization. CFOs emphasized the need for finance departments to be the custodians of accurate and reliable financial data, serving as the single source of truth. This ensures that decisions made across the board are based on consistent and trustworthy data. The survey conducted during the Roundtable revealed that one-fourth of the CFOs present identified "Data Readiness and Hygiene" as their primary focus for 2024. Click here to read the Boston CFO Roundtable key takeaways.

CFO Insights

The CFOs discussed their experiences and challenges in aligning the entire organization with the crucial need for accurate, well-segmented data. One participant remarked, "Cultivating a data-first mindset is difficult when Finance does not control the inputs but is held accountable for the outputs." This lack of control over the data foundation for reporting made it challenging for CFOs to strike a balance between optimism and necessary skepticism when presenting information to management, the board, and investor. A recent article from CFO.com also discusses how the CFOs are bullish about technology but struggle internally with the right datasets being used to make decisions.

Actionable Strategies and Best Practices

CFOs around the table who had successfully tackled these data challenges shared several strategies that had helped them overcome these data challenges:

1. Involve Stakeholders

A collaborative approach is essential for improving data hygiene and governance. CFOs recommended partnering with key stakeholders, with the Chief Revenue Officer (CRO) being a top ally. By involving different departments, organizations can foster a culture of data accuracy and accountability.

2. Highlight Incentives

To encourage better data practices, it's important to demonstrate clear incentives. CFOs suggested showing stakeholders how improved data quality can lead to increased budgets, investments, and other tangible benefits. This approach helps align everyone's interests towards a common goal.

3. Focus on Process

A robust business process is more crucial than merely accumulating data. One CFO emphasized, "Having a clear process is key to ensuring data integrity and usability." Streamlining processes ensures that data is collected, managed, and utilized effectively across the organization.

4. Embed Financial Analysts Within Operating Teams

To ensure that every team in the organization utilizes finance-approved data and adheres to consistent forecasting guidelines and assumptions, finance analysts should collaborate closely with operating teams, often becoming an integral part of those teams.

Conclusion

The CFO Roundtable provided valuable insights into the importance of data hygiene and governance in achieving a unified source of truth. By involving stakeholders, highlighting incentives, focusing on processes, and adopting a data-first mindset, organizations can enhance their data management practices and drive more informed decision-making.

These strategies help finance leaders not only maintain data integrity but also support organizational growth and success in an increasingly data-driven world.