How CFO of the Year Bill Thelen Utilizes Data to Predict Business Outcomes

November 30, 2019 | Tiffany Root

As we quickly approach the end of the decade, “data” has become a much more popular topic than it was in 2010. Data is now everywhere! According to bigdata-madesimple.com, “Every day, we create 2.5 quintillion bytes of data — so much that 90% of the data in the world today has been created in the last two years alone.” With this exorbitant amount of data being created and collected many companies are utilizing data to make informed business decisions to impact growth.

Q Consulting has grown significantly over the last 5 years and Bill Thelen, Chief Financial Officer and MSPBJ 2019 CFO of the Year, has been an integral and critical part of this growth. In a typical business, the CFO is relied upon to deliver the financial strategy to executive leadership. In a small business, it’s that and so much more. Strategic initiatives, tactical implementations, predictive analytics reporting, Human Resource functions, banking and insurance relationships are just a sample of everyday life for the small business CFO.

Bill uses a data and metrics-driven approach to safeguard the company assets and maximize shareholder value. Last week I sat down with him to talk about the importance of data, metrics and predictive analytics in business.

  1. Q: What is the importance of data in your role as CFO? What does the word “metrics” mean to you?
    A: Data is very important. As the CFO, I am responsible for encouraging and ensuring that we as an organization are using clean, relevant data to review the past and predict the future market conditions.
    “Metrics” can mean many things.  Metrics can be a forward-looking indicator of what will happen and are also an outcome that has occurred in the past. Both are used to measure where the company is going and what the company should pursue from a market and infrastructural standpoint.
  2. Q: In your opinion, what differences in data have you witnessed from the start of the decade (2010) to now? In your role, how do you now use data differently than 10 years ago?
    A: Data is more visible now than ever before. Results have shown that using good clean data can change behavior and allows companies to make better, more educated decisions. The stream of data has become more automated with the improvement in technology.
  3. Q: In any business, how would you determine what data points are most important and which to track?
    A: It depends on many factors including the industry, size of company, sales pipeline, external market conditions, seasonality and consumer demand. It’s important to focus on data points that are leading indicators of what will predictively happen in the market, versus what has happened. 
  4. Q: How can data directly impact business?
    A: It can identify trends or cycles. It can create predictive analytics to allow us to be more proactive as opposed to reactive. It provides a guideline for when to expand and when to contract. It helps identify organic growth (internal) and acquisitional growth (external).
  5. Q: How can data impact budgeting?
    A: Through looking at cycles, data helps identify trends to determine where the organization is going to go and what will create return on investment. For example, when we evaluate developing a new website, we want to determine the difference of “is it going to look cool” or is there a function behind the spend that that will generate future business and provide a return. Data helps determine where allocated budget will help return on investment.
  6. Q: How do you make decisions, including hiring decisions based on data?
    A: I utilize data to identify areas of need for future growth and attempt to target items that will generate a return. There is a cost of doing business. We understand there are expenses that may be required that may not generate a return, but if we can steer a dollar in the right direction, that’s what we’re going to do, while continuing to maximize shareholder value.
  7. Q: How do you get the leadership team and the rest of the organization to speak the same language when it comes to metrics and data?
    A: Industry experience and knowledge are important steps to get everyone on the same page including: walking through the process flow of the business cycle, looking at a historical throughput from order to receipt, analyzing ratios associated with the process flow, and educating team members on the key metrics that drive the business.
    Through the review of metrics, the team can look at ratios and identify trends. When trends get out of sync, the organization can review, determine cause and change future behavior.
  8. Q: What should companies do to make the most of out their data/metrics?
    A: Strive to look at where you’ve been and include both internal and external factors of where you’re going. By the time you look at financial results, that hindsight can be stale. Identifying and adhering to key metrics will allow you to be more predictive.

To paraphrase, with the recent influx of data created and collected there is now, more than ever, a measurable way for companies to make intelligent decisions. By identifying trends through data, companies can create guidelines to predictively make decisions for growth. It is important to identify the data points specific to your company that will be leading indicators of what will happen. Focusing on leading indicators can determine where an organization is going to go and what budget can be allocated to generate a return on investment. As Bill stated, “Results have shown that using good clean data can change behavior and allows companies to make better, more educated decisions.” Identifying trends and key metrics in your organization will allow you to be more predictive and make changes based on the goals of your company.

Analyzing and identifying the most important data points will ensure future business growth. I’d love to hear your thoughts and insights! What is your organization or team doing to best utilize data that will impact business growth?