Data is the lifeblood of modern business. The ultimate goal of any organization is to establish a reliable source of data as a basis for maximizing performance. But achieving this goal in the digital world is no easy feat given the amount of data we now generate. The World Economic Forum estimates that by 2025, the amount of data generated every day will reach 463 exabytes globally, which is equivalent to one billion gigabytes.
Compounding the data challenge is the fact that 90% of value created now comes from intangible assets – most of which are not recorded on financial balance sheets – from customer relationships to social to intellectual capital. According to Ocean Tomo in its Intangible Asset Market Value Study, the percentage of intangible assets has grown from 17% in 1975 to 90% in 2020, highlighting how important this area of data management is for today’s companies. However, now it is more difficult than ever to get a reliable source of data as organizations must deal with countless sources, both inside and outside their networks.
The expectations of today’s CFO have also changed, from maximizing shareholder value from existing operations to becoming the architect of new value creation. To achieve this, CFOs need the right data, technology and people, so they can predict events and drive value. However, traditional ERP systems are built to track value, not create it. These legacy systems were not designed to manage the intangible value drivers of the digital economy and the data they generate, making it difficult for today’s CFOs to meet these new expectations.
One example of a company that has overcome these challenges is the American broadcaster EW Scripps Company. Founded in 1878 as a chain of daily newspapers, the company underwent a major transformation in 2015, divesting itself of its declining newspaper business and moving into local television and national media.
Support for this transformation was a technological upgrade, aimed at a better integration of finance and human resources. Scripps has digitized its HR operations, with Workday as the foundation. Despite being in the midst of multiple mergers and acquisitions during the rollout of the technology, the implementation went smoothly and allowed Scripps to more easily reorganize the business after the acquisitions.
After a smooth rollout and benefits on the HR side, Scripps added Workday Financial Management and Workday Prism Analytics. This offered the company a unified source of financial and human data, along with a framework for rapidly integrating the operations and finance of a new acquisition – a complete business reorganization can now be completed in as little as two weeks, significantly reducing the time to new value creation from acquisitions.
Scripps was able to remove 32 different system interfaces, making it much easier to access and analyze information. Finance teams are able to spend more time developing analytics, reports and dashboards for forecasting, rather than being tied down to core finance tasks.
This proved especially important during the COVID-19 pandemic, which resulted in a drop in advertising revenue. With the scenario planning and frequent reporting enabled by Workday Adaptive Planning, the leadership team was able to make faster and more informed decisions when cash flow was tight, quickly adapting to new business circumstances.
As Vagelis Kontopos, vice president of financial planning and analysis at The EW Scripps Company, explains, “Workday has given us the data and insights to better strategically run our business, especially through difficult and uncertain times, and much faster.”
Using a common platform across all divisions, Scripps has reduced monthly reporting times from two days to about 30 seconds, which means faster and more frequent delivery of real-time reports, forecasts and budget updates to the management team.
This is a great example of a business that has moved from using technology only to track value to a position to find value from its data.
Establishing a reliable source of data is critical to successful value creation. Organizations require their data to be an accurate, up-to-date version of the truth from a single source. Once available, they can access key insights from their data to improve business performance, including the most profitable revenue drivers, the largest sources of discretionary spending, and where to allocate capital to maximize ROI.
Another example is Coleman Worldwide Moving, which has added advanced analytics to its technology infrastructure to get more value from its data. Before implementing Workday Prism Analytics, the moving company was juggling incompatible, disparate systems. With 60 service centers across the US, this made it a challenge for users to access relevant data or combine it with external information sources.
The transportation and warehousing company established a CEO dashboard, which offers managers a one-stop shop to access key metrics, such as the aggregate P&L for their location. The dashboard integrates data from Workday Financial Management with additional data sources including Coleman’s billing system and customer satisfaction surveys.
Using our analytics technology, Coleman can run reports for 300 drivers within minutes – previously this task took up to an hour for just one driver – and was able to help his drivers become more profitable.
The business now has real-time insight into financial performance, and the finance team can run reports in seconds, speeding up the time it takes to review relevant data, make decisions and take action.
In today’s digital economy, companies must view their data as a mine for creating business value, not as an asset to simply be tracked. To achieve this, it is vital to establish a reliable source of data, as demonstrated by The EW Scripps Company and Coleman Worldwide Moving.
With the right technology, finance can evolve from tracking value to driving it, armed with the necessary insights to anticipate and proactively respond to events, the adaptability to pivot quickly to seize opportunities, and the talent to support this new mandate.
In our next article, we’ll explore how to solve the problem of adaptability with flexible and secure processes that support change. Our final article in this Big Ideas series will be overcoming the talent challenge by offering current and potential staff a modern experience.