Become the Gatekeepers of Big Data

More financial professionals working in business are using Big Data in their decision-making process. And the explosion of data generated each day plays a huge role in how management accountants perform their day-to-day duties. Although there are many positive aspects of integrating new technology into our companies and using analytics to interpret data, there are also drawbacks. Here’s a breakdown of Big Data and how management accountants can become the gatekeepers of this information.

What Is Big Data?girl on phone - connect to customers
In 2013, IMA® and ACCA (Association of Chartered Certified Accountants) published a report titled “Big Data: Its Power and Perils,” which defines Big Data as “the vast amount of data continually collected through devices and technologies such as credit cards and customer loyalty cards, the Internet and social media and, increasingly, Wi-Fi sensors, and electronic tags.” Big Data can help improve company performance and productivity to increase company revenue and stakeholder trust. Management accountants use Big Data to identify risks in real time and to make valuable business decisions.

What Are the Trends?
Big Data is changing the landscape of business. Companies are going from using predictive analytics to prescriptive analytics – they’re collecting data from their customers’ cell phones and other mobile devices to analyze customer profitability. This allows companies to cross-sell and up-sell their products. Management accountants are charged with analyzing this data and distilling it into bite-sized chunks so that management, who might not be familiar with the analytics, can find it easier to digest. As gatekeepers of this information, the management accountant’s role will become increasingly important.

What Are Some of the Risks?
As the amount of data grows, so does the risk for hackers to steal information and other actors to commit fraud. Although more data might make it easier to make decisions, it also requires an increase in both physical and digital internal controls. Securing your physical data warehouse and controlling who has access to it will help deter wrongdoing. And because hackers are everywhere, cybersecurity should be top of mind for every company – large or small. As a result, improved tools and techniques are being developed daily.

In addition, not knowing how to analyze so much data can lead to erroneous conclusions and decisions. There’s also an opportunity cost of gathering, storing, and analyzing bigger data instead of making other core investments. In other words, picking the wrong tools and hiring the wrong people to use them will increase the likelihood of misallocation of resources.

What Are the Rewards?
On the flip side, there are many opportunities for company growth and market expansion because of Big Data. Like I mentioned previously, companies can harness a new market by emerging in the mobile market. Mobile devices can be accessed through Wi-Fi (or if the customer downloads the company’s app – another opportunity for expansion), which makes it easier to connect to your customers and advertise new products. In turn this improves analytics, and thus, you can learn how to better serve your customers, increase revenue, and develop targeted services to niche markets.

How Can We Protect Company Data?
When using Big Data, companies should always consider a data governance strategy, which will help mitigate risk. The strategy should cover the availability, usability, or utility of information and the integrity, quality, and security of information. Management accountants play a large role in protecting company information, systems, data centers, and more through effective controls and monitoring. After all, you are the gatekeepers of Big Data.

To become part of the conversation, visit the Technology Solutions & Practices (TS&P) Committee on LinkUp IMA: http://bit.ly/1SrwFHe.

Written by Linda Devonish-Mills, CMA, CPA, CAE

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Top Technology Trends for Management Accountants

There’s no doubt that technology plays a huge role in business today, including in accounting and finance. New technologies will always emerge, which can make it confusing for businesses to focus on the most relevant ones. Not all technology trends will necessarily apply to management accounting and finance; so it’s necessary to filter through and match solutions to your company’s unique needs.

IMA’s Technology Solutions & Practices (TS&P) Committee recently undertook some research and analysis to gather market literature and insight into a full slate of technology trends in an effort to filter through and find those most meaningful to management accountants. This short list of technology trends will serve as the basis for resources in order to understand these technologies and how they apply to management accountants.  Here are the trends identified by the committee for 2015-2016.

SEO optimization, programming process1.    Business Intelligence and Analytics
With mountains of both structured and unstructured Big Data growing daily, companies must glean meaning from the most relevant data to drive decision making. Powerful cloud-based tools exist to help companies perform advanced analytics (e.g., predictive and prescriptive analytics) to gain intelligence about the business and more insight into where it’s headed.


2.    Data Governance

A sound data governance strategy sets the foundation for a company to ensure its information assets are accessible, usable for analysis, and of the highest quality and reliability. If data can’t be used or trusted, it’s almost worthless to the company. Data governance strategies, which are now growing in practice, help companies define the proper controls and monitoring systems to ensure access, utility, and quality.

3.    Mobile Computing
As smartphones and tablets evolve, so will the environment they occupy. Your office will be virtual – wherever you can connect to the Internet. vector illustration of mobile optimization and analyticsSmartwatches and other wearable gadgets are also catching up in usability and allow for constant connectivity to your work space.

4.    Big Data
With the increase in mobile computing and growth of our digital footprint comes an increase in Big Data. You will need optimal analytics skills and tools to process such data efficiently and effectively to make appropriate business decisions.

5.    Cloud
Today, nearly 50% of U.S. businesses use the cloud. You may already use it in your day-to-day work, but companies that don’t currently use cloud technology will be left behind this year. There are many options to choose from to fit your company’s specific needs.

6.    Internet of Things
The “Internet of Things” (IoT) refers to the connection of more and more devices to the Internet, including household devices like thermostats and TVs and business tools like vehicle fleets. IoT generates both more Big Data (to be filtered through) and intelligence about the business, which helps bring greater efficiency and process improvement, among other benefits, to businesses.

7.    Cyber and Physical Security
The increase in cybercrime over the past few years has proved how important it is to protect your company’s data. Not only will you need to improve your risk assessment and management tools, but you’ll also need to properly secure your physical infrastructure.

8.    Smart Machines and Automation
This year will push smart machines ahead of the curve. With the ability to learn and adapt to their environment, there are no limits to what they can do. Companies should know how to use this ever-evolving artificial intelligence to their advantage.

Which trends are on your company’s radar? Have you had to make any changes to your systems or processes?

Written by Linda Devonish-Mills, CMA, CPA, CAE

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Top 10 Strategic Technology Trends for 2015 – Forbes
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