If there is one thing that can change finance’s power and dominance as a decision-making tool, it is the rest of the data. According to Google (2020), 3% of company data is finance data when considered part of an entire company’s data lake. McKinsey reports that 90% of company decisions are based on finance data alone, the same 3% of data.
If you are in accounting, audit or finance shoes, how would you play the game to retain control when something more powerful comes on the scene? You ensure that data is within your domain, you bring out the big guns and declare that data is just another asset or liability, and its rightful position is on the balance sheet. We get to value it as part of the business. If we reflect on it, finance has been shoring up its position for a while. HR, tech, processes, methods, branding, IP, legal, and culture have become subservient and controlled by finance. In the finance control game, we are all just an asset or liability and set a budget! In the context of control and power and how to make better decisions, as a CDO, your friends and partners are human resources, tech, legal, operations, marketing, sales and strategy; your threat and enemy is finance.
A critical inquiry you will have on day 0 is what weight do we, this organisation, put on the aspects of good decision making? How do we order and with what authority data, finance, team, processes/methods, justifications, regulation, culture/brand/reputation, compliance/oversight/ governance, reporting and stewardship? What is more important to us as a team; the trustworthiness or truthfulness of a decision? The quality of a decision? The explainability of a decision? The ability to communicate a decision or diversity in a decision? If data is controlled by finance and seen as an asset or liability, how does it affect your decision making capability?
As the CDO, if you determine that the axis of control remains with the CEO/ CFO it may be time to align your skill to a CEO gets data.
Note to the CEO
It is your choice, but your new CDO is your new CFO in terms of power for decision making, which means there will be a swing in the power game. Your existing CEO/ CFO axis is under threat, and we know that underhanded and political games will emerge in all changes of power. You will lead the choice about how you want this to play out given that all CEO’s need to find their next role every 5 to 7 years, which will only ever require more interactions with the CDO and data, defending the CFO power plays will not bring favour to your next role. The CFO remains critically essential, but the existing two-way axis (CEO/CFO) has to become a three-way game that enables the CDO to shine until a new power balance is reached.