Finance functions within insurance companies have traditionally been the stewards of historical data, analyzing and presenting what happened via management dashboards and reports. However, CFOs are now being asked to “step into the cockpit”—like stepping into a flight simulator—to make changes to key business metrics (e.g., combined ratio, market share, risk appetite) and evaluate how company performance may change under different economic (e.g., interest rate, inflation, growth rate) and competitive scenarios. Executive SummaryGone are the days when CFOs merely explained the drivers of current underwriting and investment results. Financial leaders can help CEOs and other members of the C-suite understand impacts of potential trends before they are realities by leveraging technology and analytics to create management cockpits, according to experts from PwC.
Put more succinctly, CFOs should be able to help “fly” their businesses through turbulent economic and competitive scenarios.
Finance functions have the opportunity to better collaborate with the business to predict what may happen and prescribe what should happen to meet strategic and operational business metrics. Looking beyond traditional dashboards that historically modeled underlying business drivers, CFOs will gaze at modern business gauges as they ask “what if.” The simulated answers will help other business leaders make midcourse corrections and in-flight decisions as they navigate through challenging landscapes.