Collecting the right financial informational and analysing it effectively could be the key to long-term business success.
Business Intelligence isn’t a new concept, but not all Scottish businesses have taken full advantage of it, explains accounting data specialist Aaron Geddes.
After finishing his chartered accountant training contract in 2020, he realized there was an opportunity to combine accounting and data science skillsets, so he undertook an MSc in data science.
Now, as senior insights specialist at financial services firm Hutcheon Mearns, now part of Cooper Parry, he helps businesses across Scotland improve their performance with the help of accounting data.
This, in theory, should be easier than ever to do thanks to the digitization of business intelligence.
While before people would develop their own sense of what decisions could drive specific outcomes based on their experience, there are now various tools and technologies to help businesses do this.
This all started in the 1970s with the introduction of relational databases, explains Aaron. These allowed data to be stored in a tabular format, ie, rows and columns.
Aaron said: “Businesses, including some that would go on to become some of the largest companies in the world, started using coding languages to apply statistical analysis to the transactions that would not only give them basic information, like averages, but would allow them to understand the distribution of the data.
“This could be used alongside other statistical techniques to provide predictive data that was extremely effective at informing decision makers. Anyone who could interpret statistics could now plan more effectively.”
Over the years, new tools and techniques have increasingly allowed information to be presented in a more user-friendly way – for example, Microsoft Power BI, a market-leading business intelligence platform with intuitive visualization tools.
As a chartered accountant, Aaron is particularly interested in the crossover between accounting and data analytics, a still relatively uncommon skillset.
He explained: “While the above techniques have mostly been possible for decades, it is a minority of businesses that have implemented them successfully on finance and accounting data due to the specialized way it has to be processed.
“Some of the businesses that did successfully implement these techniques have grown from startups to the largest companies in the world in the last 20 years.”
Hutcheon Mearns, now part of Cooper Parry, can specialize in providing finance data quickly because the Insights department have unique knowledge of both accounting rules and data science principles.
They help clients automate the production of their old reports, produce more informative analytics and guide the client on how to interpret the analysis. This lets their clients spend less time preparing the information and more time making informed decisions.
The Hutcheon Mearns Insights team is so successful at this work, is has recently been nominated for the Digital Innovation category at the Dundee & Angus Chamber Champion awards.
And they see the demand for a crossover of accounting and BI skillsets becoming even more important in the finance industry. That’s why they’re also sponsoring a ‘Best In Year’ award for the recently created Accounting with Data Science degree at Robert Gordon University, to help support and champion the next generation of finance data specialists.
Areas where Business Intelligence can make a difference
While artificial intelligence (AI) is often seen as the next step for Business Intelligence, many businesses would see big improvements by using the tools available now more effectively.
Aaron Geddes said: “This includes businesses that maybe rely on simpler metrics like totals and averages, or rely exclusively on Excel reports that can’t visualize the information in a suitable way.
“Going from that to applying predictive statistics on business performance and presenting the information in an accessible format for decision making, will significantly improve their performance and it’s more realistic to implement successfully.
“Using older techniques well, like statistical analysis or data mining, will always serve you better than using advanced AI techniques without the proper knowledge to understand what they’re doing.”
Some of the areas that the Hutcheon Mearns Insights team can make an impact today include:
- Management accounts automation
- Customer Performance Analytics
- Asset/Product Performance Analytics
- Credit control reporting
- Daily sales reporting
This article was featured in the Press and Journal on July 25 2024
