We live in a data rich world. Data has been likened to “oil” or “gold,” or some other valuable resource that will determine if organizations prosper or fade into obsolescence. But “big” invariably precedes the word “data” in most cases, leading one to wonder if small businesses (with “small” being the operative word) can leverage big data for the insights and decision-making support that larger organizations take for granted. 

At IMA’s 2021 Annual Conference, IMA President and CEO Jeff Thomson, CMA, CSCA, CAE, and IMA Director of Data Analytics Hirav Shah,  shared what they learned about IMA’s experience implementing a data analytics function and what it had to teach any small-to-medium sized business about data analytics.  The skills and technologies embedded within data analytics can do many things including:

  • Exploring past business performance to drive business planning for the future
  • Delivering on insight and foresight which are now needed for creating sustainable competitive advantage  

Data analytics can be applied across an organization’s value chain, from marketing to customer management to finance, for better decision making and more impactful results. Real-time reporting and building more accurate predictive models are just two of the many tools enabled by data analytics. For small- to medium-sized businesses, these capabilities can reduce costs, enable sales growth, and improve business outcomes. 

Thomson and Shah’s presentation made clear that while small-to-medium sized organizations may have concerns around cost of implementation and upskilling employees, the costs of not implementing these breakthrough technologies may be more onerous. In fact, some even make the argument that small businesses are in a unique position to capitalize on the promise of data analytics. In these organizations, CFOs customarily own the IT function, making the link between finance and data analytics implementation that much stronger. 

Underscoring that point, Steve McNally, CMA, CPA, IMA Chair and CFO of The PTI (Plastic Technologies Inc.) Group of Companies, recently wrote in CFO.com, “CFOs must set an appropriate “tone at the top’” by demonstrating a willingness and desire to upskill in technological areas.” He exhorts CFOs to ask the right questions about technology and explore ways to use it to better understand current realities. For McNally, technology holds much promise for enhancing finance’s storytelling abilities, building better cross-functional partnerships, and enabling decision making. 

Indeed, learning the skills to properly leverage the full potential of Big Data and data analytics is part of IMA’s Management Accounting Competency Framework. IMA has a variety of educational resources and continuing education courses devoted to this topic, to help upskill accounting and finance professionals in what is now a critical area for their long-term career growth and longevity. Amid the pandemic, the pace of digital transformation has accelerated, with organizations now realizing the benefits of advanced technologies far outweigh the drawbacks. IMA’s continuing education offerings are relevant now, more than ever.

As an IMA member, you can participate in a webinar or take one of our many courses for free.  IMA is the comprehensive source for gaining management accounting expertise, with webinars, podcasts, and courses delivered by professionals with valuable insights to offer.

Toward that end, IMA is at the forefront of research capturing the progress of accounting and finance in their journey towards Big Data and analytics transformation. A 2019 research study, “The Impact of Big Data Now and In The Future,” offered perspective on what a truly data-driven organization looks like, namely:

  • Has strategies in place to ensure everyone is trained on use of data analytics
  • Employees use it appropriately, understand and report results based on it
  • Executives and employees are committed to act on insights uncovered based on the data

At the time of this survey, 53% of respondents had developed strategies around the use of Big Data, with 80% of that cohort reporting improved organizational performance. Among small businesses, the researchers found they were slightly more likely than larger firms to report having completely implemented Big Data initiatives. 

More recent surveys conducted during the time of the pandemic indicate small businesses continue to invest in analytic programs, with a 2020 survey by OnePath finding 67% of small businesses are spending more than $10,000 a year on analytics. 

It’s clear from research as well as practitioners that Big Data and analytics are not the preserve of just large enterprises. In fact, small businesses may have an easier time implementing these programs given that the purview of CFOs in these organizations often extends to IT. Indeed, recent disruptions due to COVID have shown that real-time reporting and predictive financial modeling are critical to business continuity in times of disruption. As the world grows ever more volatile and complex, small businesses cannot afford to bypass the data analytics trend. 

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