Clifford Stoll once said, “Data is not information, information is not knowledge, knowledge is not understanding, understanding is not wisdom.”
So, is data still important? In reality, this is a catch-22 question. On one hand, we need data to drive the decision-making process. However, on the other hand, if the data is siloed, bad, outdated, or incomplete, this creates the perfect storm of unrealistic goals and horrendous decisions.
With all this in mind, Glenn Hopper, CFO of Sandline, joins me in this episode to explore the evolution of CFOs, digital optimization versus transformation, the impact of AI, and what fuels the data-driven CFO.
Glenn is the author of Deep Finance: Corporate Finance in the Information Age and is passionate about transforming the role of Chief Financial Officer from historical reporter to forward-looking strategist.
00:02 — Finance leaders are diving into the technical aspects of data and determining how to balance the strategy around this. What should CFOs and finance leaders be focusing on? Glenn Hopper joins to unpack the need for digital optimization versus transformation within finance teams, the path of data to wisdom, and more.
02:40 — The intent behind Glenn’s book is to advocate that all finance professionals need to know enough to be dangerous when it comes to technology and coding. The book serves as a roadmap for CFOs to lead digital transformation in their businesses.
04:35 — While looking backward is still vital to identify trends, CFOs are going beyond forecasting. Simply being a conduit of information doesn’t add value. The role of the CFO moving forward requires adding value to every bit of data.
06:13 — If the CFO is just a conduit, then they aren’t really needed. The CFO needs to provide strategic value, expertise, and value knowledge to fully explain the data.
07:03 — As data becomes more available, automation is being further incorporated into finance and accounting functions. If workers are being replaced by automation, what then happens to the finance department? Finance professionals will need to upskill and be placed in positions that provide more value.
“From a psychological standpoint, [automation] helps the person realize that they are more valued than just being a data entry person…they should feel like they’re more valued as a person with their knowledge and experience.”
10:00 — Since the introduction of data lakes, there has been a great progression in the democratization of data, such as increasing access to data. CFOs can be part of this, as the same skills used in finance functions can be transferred to data science; it just takes it to another level.
11:55 — Having access to data that goes farther out enables more productive, informed, and strategic conversations within organizations. The quote from Clifford Stoll encapsulates this idea well—emphasizing the need to have data to back up strategies and decision-making conversations.
“You can have this massive amount of data that you’re collecting…but if you’re not doing anything with it, who cares? It’s just noise.”
14:01 — By using analytics to translate data, CFOs can determine their first steps towards descriptive statistics and identify correlations. Then, they can move through their next steps by using that information to better understand business structure and develop predictive analytics. Having this level of understanding then leads to the pyramid of wisdom. This is when you can truly run a proper data-driven organization.
15:50 — Collaborative experience comes behind that wisdom. Conversations with peers are essential to harness that experience and input to maximize the potential of your data.
16:23 — Further shifting the focus, CFOs become the messenger of the findings—from the Board of Directors all the way down to frontline workers.
17:12 — As the CFO, your objective isn’t going to be protecting operations over sales. As the CFO, you can keep the other C-level people honest and have your own data insights because your view is not through the filter of operations.
19:43 — Where should there be strategic investments in certain technologies or upskilling through HR efforts?
20:20 — While Covid-19 has activated hyper-growth, many companies are seeking the next steps of digital transformation. Glenn encourages companies to not miss the mark—technology is advancing and businesses need to be prepared to digital transform to maintain a competitive edge.
22:27 — There have been increasingly more moves towards the augmentation of the human. People need to grasp the difference that they are not being replaced by technology, but that they could be replaced by a person who is understanding of the evolving and advancing technology.
23:41 — In this past, businesses and industries took longer to reach a point of revolutions. Now, the pace of change is much faster.
“Digital transformation…it sounds like one and done. And it’s not really…It’s more of an evolution.”
26:35 — It seems that digital transformation has been overused or lost its original meaning and what it was intended to be. It has morphed into multiple different things. Rather, organizations can shift their view to digital optimization as well as it being an ongoing process—continually optimizing at an increased pace of change, moving forward faster.