New technologies allow companies to generate, collect and analyze data with incredible speed and volume. However, this data abundance also carries greater risk. Without proper data governance and management, poor data quality, inadequate security and lack of oversight can critically impact business performance.

CFOs feel pressure to instill rigor into data management as they partner across departments. According to the 2023 Paro Future of Finance Survey, data governance skills are the second most lacking competency reported by senior finance executives after data analytics. As finance oversees fiscal discipline, it must also govern data with rigor.

The greatest data issues facing finance teams

Fractional analyst and CFO Chase DuBois sees a number of data challenges facing his clients.

“The biggest data issue, if I were to explain it as a business owner would experience, is that they just don’t have data that’s granular. And they need it, when they need it, to make a decision,” says Chase.

Trouble retrieving and isolating that data quickly, according to Chase, is often due to a lack of standard operating procedures regarding data input and management.

Despite having the data, businesses still grapple with silos between systems and stakeholders, as well as slow manual processes and poor controls. Refining these processes, according to Chase, first requires defining them.

Define processes and stakeholders

Whether you’re defining authorized users for sensitive data or what to consistently name a specific data field input, it’s about establishing and documenting operating procedures and crucial data governance roles.

“It all starts with a well-defined field or a well-defined process to get the data into a table or an application,” says Chase.

To get these first steps right, ask questions like:

• Where does the data initiate and who owns it?
• Who inputs that specific field of data?
• Who are all of the downstream stakeholders for this data and how will they be made aware of changes to the data?
• Are the stakeholders impacted able to contribute to the decision making around that data?

In addition to defining these roles, it’s important for leaders to work with the right experts, whether within their organization or hired fractionally, to help automate and centralize data management for consistency.

Build trust and credibility in the data

Credibility is of paramount importance, especially for CFOs and FP&A practitioners who must communicate complex financial data to non-finance leaders and managers.

It’s important to first establish transparency around the data’s quality and explain the benefits of making quality assessments. Have a plan in place that you can communicate to stakeholders when the data just isn’t quite there yet.

Establishing trust in business comes down to a simple matter “of just doing what you say you’re going to do, when you say you’re going to do it,” says Chase. While leaders know they can’t rely on the data yet, there’s a benefit in knowing there’s a plan in place.

Key partnerships for data success

Building a data governance and management plan is not something finance leaders can do alone. Finance benefits even more by partnering with IT and database administrators, as well as outside experts.

“Establish a partnership with the administrators of the database and your company and really start working across the organization with the data organization,” states Chase.

Today’s CFOs are working more closely with IT and even their own data organizations to better understand:

• Where is the data coming from?
• What are the current gaps?
• What could go wrong with this data in the future?

The other component is working with the right fractional or outsourced professionals who understand and practice these standards with today’s most up-to-date tools. The best way to get up to speed is to stack your team with the right transferable skills to help reach those goals faster. This cost-effective investment helps you solve data challenges sooner. The longer you wait, “the more bandage you’ll have to rip off and replace with a long-term solution,” says Chase.

Providing ongoing education on using data insights is also essential to a data management plan that sticks. Team leaders may incorporate some continuing education in the form of a formal course or even an expert coming onsite for a day to lecture.

Investing in partnerships within your organization and outside of your organization to develop your strategy will ensure that no stone is left unturned, so your business can trust and use its data faster.