Analytics helps global business services fuel resilience and return

Here is an excerpt from an article written by Luiz Fernando Ramos, Samir Singh, and Paul Welti for Harvard Business Review and the HBR Blog Network. To read the complete article, check out the wealth of free resources, obtain subscription information, and receive HBR email alerts, please click here.

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But to make the right decisions, companies needed the right data, and they needed it in a timely fashion. How many actually had it?
In any rapidly unfolding situation, particularly in the uncharted territory of a pandemic, it would be an understatement to say that decision-making is challenging. Traditional KPIs, as lagging indicators, are inadequate. Last quarter’s sales numbers won’t help much in forecasting demand when a sales channel suddenly goes dark, or customer needs make 180-degree turns, or other tried-and-true assumptions become moot overnight. Companies need reliable micro- and macroeconomic indicators to discern emerging trends, new behaviors, and new correlations. The insights derived from these indicators can give companies the ability to be proactive, which can mean the difference between securing competitive advantage and enduring prolonged performance woes. In starker terms, it can also mean the difference between a sustainable business and a slide into irrelevance.
These insights are actually at companies’ fingertips. Global business services (GBS), the central organization for general and administrative functions including finance, HR, IT, procurement, and legal, has often played an important role as data “first responder” when reliable data were needed fast. As the central data repository of financial, HR, procurement, and other crucial processes that touch every aspect of a company’s operations, GBS can be a gold mine of information.With the right analytic capabilities in place, GBS organizations are well-positioned to help the enterprise quickly harvest actionable insights from the wealth of enterprise data they handle—data that are processed and updated regularly, often in real time. Carefully designed advanced-analytics algorithms, applied to GBS data in analyzing a specific business issue, can dramatically reduce subjectivity and bias in supporting clearer-eyed decision-making. Moreover, GBS functions’ ongoing analytic work gives their people the skills and mind-sets needed to draw insights from the data.
As companies navigate the COVID-19 recovery, an advanced-analytics program can help GBS serve as an even more effective information broker, equipping leaders with the information they need to make proactive decisions quickly. GBS is designed to reap economies of scale, so playing this data role represents a natural evolution. Such an arrangement also allows GBS to work more efficiently, freeing it from the manual reporting it must sometimes perform so it can serve the enterprise more strategically.

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The COVID-19 pandemic has tested companies’ planning and resilience as never before. The next three to six months represent a critical rebuilding time for businesses. Having a clear view of demand, supply, and other critical operational and customer trends can give them a major jump-start.

Beyond its role as the keeper of the transactional record, GBS holds the key to strategic insights that are particularly elusive in a time of crisis and rapid change. Putting this to use requires GBS to shed its passive, process-oriented mindset. Rapid analytics with GBS calls for a fresh approach that brings together cross-functional teams from IT, the business side, and the data engineering and science areas to work together in agile fashion.

Instead of continuing to play security guard at the data gold mine, GBS can stake its claim as master and broker of the organization’s most precious asset: its rich store of data. But as automation and analytics advance, the window of opportunity may be closing. Now is the time to recognize the value GBS can create—and unleash its power in helping guide the enterprise to recovery, resilience, and competitive advantage.

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Here is a direct link to the complete article.

Luiz Fernando Ramos is an associate partner in McKinsey’s Paris office, where Paul Welti is a partner; Samir Singh is an expert in the New Jersey office.

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