Understanding performance data: What’s the story?


The CFO’s role is rapidly expanding in scope, requiring new capabilities, and demanding greater collaboration. Long gone are the days when they were only responsible for balancing the books. Today, they are involved in all aspects of decision making and solution finding with varied responsibilities such as sustainability reporting, ESG considerations, technology and transformation, as well as ensuring strong financial leadership.

As the role evolves it needs to keep pace with the rapidly changing landscape. CFOs need to be knowledgeable about issues and challenges in the wider sector in which they operate to make good evidence-based decisions. Having access to clear, timely and transparent data is essential.

Focus on outcomes

Data gives valuable insights and can help deliver value for money. We can use it to build a strong business case, establish benchmarks and identify improvements. Good quality data, whether it’s performance or finance related, is an essential element of any well-run organisation.

To dig deeper into what makes data useful, CIPFA and Civica convened a roundtable discussion with leaders from the public sector. After a short introduction by Chair Joanne Pitt, Local Government Policy Manager at CIPFA on the changing role of the CFO and the important role of data, delegates were eager to contribute.

Christopher Stevens, Head of Local Government, Performance and Partnerships at the Welsh Government began by highlighting that: “It’s not all about financial management data. We need a clear focus on outcomes for citizens, and while managing money is a part of that, we can also use data to show that we’re achieving wellbeing goals, for instance.”

“Non-financial data is critical,” agrees Eunice Jones, Group Manager, Social Care and Housing at Torfaen County Borough Council, “we need to link up all the different bits of legislation to produce a data set. In social care, we can also measure outcomes with qualitative stories, which are often perceived as being below quantitative stats, but good outcomes can be very personal, such as someone being able to make a cup of tea for themselves. It’s not just about stats.”

Non-financial data can be used to assess whether organisations are meeting their targets and to get a better understanding of people’s quality of life. Tony Deakin, Board Member at Trivallis Housing Association, emphasises the importance of non-financial key performance indicators, especially when it comes to meeting housing standards. “Now there is a national focus on damp and mould, but previously reporting wasn’t geared up for those factors. We’re having to think about how to collect data to give assurances to boards and regulators to show that standards are being met.” He goes on to raise the difficulty of working with aging systems that were designed to collect one type of data, but now need to collect many different types. “Can they be tweaked easily? Can they be changed over time to identify other issues which they weren’t originally designed for?”

Drawing comparisons

Data can help CFOs understand how their organisation is performing in relation to others in their sector. But benchmarking is not always easy. “We don’t have a neighbouring service to compare to,” says Ceri Jackson, Corporate Head of Resources at Mid and West Wales Fire and Rescue Service. She goes on to explain that when you are a different size or makeup from most of the sector, it can be very difficult to compare like for like.

Michael Betty, Management Accountant from South Wales Police, adds “In the police, outliers can have a big impact on comparative data, so it makes it hard to benchmark unless every force is structured the same, which is never going to happen!”

Comparative data often leads to undesirable league tables, so it is vital that context is placed around data. Ben Sears, Data Manager at CIPFA explains that’s the reason why he doesn’t use the terms ‘best’ or ‘worst’ in CIPFA data tables, such as the resilience index, preferring to use ‘high’ and ‘low’ instead. He says comparative tables should not be used as a ranking system, but as a tool to see how your organisation is performing compared to your closest neighbours and to identify issues or drive up performance.

But what about having the right skills to make use of the data? It’s all very well having great data, but we have to know how to interpret it. Eunice Jones says: “People can become obsessed with the number of days you are taking to perform a task, rather than the outcome that the task is having on an individual. So what is the data really telling you?”

“We should never advise policymakers based on quantitative data alone. We need to have a balance between quantitative and qualitative data. There is a specific skill set needed to analyse data, but it’s more about finding the right data in the first place” adds Christopher Stevens.

Sarah Mansbridge, S151 Officer at Mid Wales Fire and Rescue Service, questioned whether we should be more critical about what data we collect. “Sometimes we present data for data’s sake, rather than asking why we are presenting it. Let’s review it and if we don’t need it, get rid of it and start afresh!”

Context is key

What was clear from the discussion was that data isn’t just about numbers. It’s also about telling a story, and to do that sometimes you need comprehensive data that includes both qualitative and quantitative information.

All agreed that a focus on outcomes is vital – again something that can be hard to identify with big data sets. How does big data show that an elderly person in care has been able to prepare themselves a hot meal thanks to the care received? This ability to measure not just output, but outcome is critical and raises the questions of how, and what data is collected and how its presented to be of most use and value

While most in the debate were concerned that benchmarking and comparative data is often used to compile unhelpful league tables, they agreed that it can give useful insight into understanding and improving performance when comparing with closest neighbours.

Data can be an incredibly powerful tool for today’s CFO to aid them in their decision making, but it needs to be considered, specific and delivered with context. After all, behind every data set are people’s stories.

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