The past, present and future of data analysis

The revolutionary effects of data have permeated their way into every aspect of our lives. We recently spoke to Nigel Whittle, Managing Partner at Lambert Chapman LLP, and Cerian Williams, Strategy Director at Nicoll Curtin, a leading IT & Change Recruitment Consultancy, about the ways in which the use of data has changed, and what the future might hold.

  What is the importance of data for businesses?

 Nigel: It’s extremely important. With the right information, you will be able to make the decisions that will help the business progress. You can get a lot of information out of systems, but it’s about getting the right information. If you get too much, you don’t look at it. If you get too little, you don’t act. If you get relevant information which gives you the key performance measures, then you act on it. So data and information is extremely important.

Cerian: I think with finance teams, sometimes there’s so much data that people don’t know what the key things to report on are. You can always go too broad, so you get packs and packs of data in some companies, and then you get nothing in others. It’s about getting the right balance, where people are looking at it and seeing what they need to do with it.

Nigel: It’s also about getting it regularly, so that’s it’s up to date. If the information is copious, but late, then it really isn’t a great help. But if you can get that summarised information, even if it’s just a couple of pages, soon after the event, then you can react quickly. So timing is important as well.

  How has the use of data changed?

 Cerian: Previously, finance and the use of data was very much retrospective. What did we do? How did we do it? Now there’s a huge drive towards a predictive approach: “Let’s see where this is going, let’s change things on the basis of data”, rather than just ticking the box of whether we know what happened.

 Nigel: What’s so important with that is, you’re right, the past is the past. It can be a useful indicator, but the future is so much more important. Therefore, it’s about getting data that is integrated, so that it gives you all of the positions, tells you what your profit is, projects forward your cash flows, and then tells you your financial position, assets and liabilities. Then they’re all integrated so that you know you don’t have to worry about using spreadsheets and formulas. It’s critical.

 Cerian: That’s why the accuracy of the forecasted future data is important, so that when the past data comes in, it’s as you were expecting it. The future data’s so important in how it’s derived, so you’re constantly looking forward, not looking back and wondering why it was so different to what you were expecting. 

  How will the use of data change in the future?

 Nigel: I’m sure programs will become more powerful. Even now, when you have these integrated programs that project forward on so many different fronts - profit and loss, cash flows, balance sheets - they still need improvement. So I’m sure new programs will be written to deliver more useful information. Some of the key performance indicators, and then starting to present non-financial measures.

 Cerian: I think financial data will become more automated, and then what becomes key is the analysis of the data. That’s where it becomes fun. A finance team will get all of the data without having to do the actual manual processing. I think technology will improve the automation of data, and what you can do is just look at the insight from it. Then it becomes, for me, really interesting, and you can start driving a business. I think finance is becoming one of the most strategic drivers of a business. Whereas previously it was seen as a ticking the box function that we needed to report business. Now finance teams are becoming the real drivers of strategy, with all of the data they’ve got at their hands that other people don’t see.

 Nigel: I can just see it continuing to go forward at what seems to be an ever-accelerating pace. People like myself who started off when everything was manual, now I don’t have files, everything’s electronic.  It’s size as well. Something that’s portable, but big enough so that you can see everything. That’s going to be a problem, the use of our eyes. I wonder how they’ll be able to make it so that our eyes, which are using computers all day long, won’t feel so strained. Then there are power cuts. Viruses. Security’s going to be such a huge issue. The biggest problem I think is going to be having too much data, and keeping data relevant.

 What do you think? What has been the effect of data analysis for business and what will the future hold? Share your thoughts in the comments below.