Many organisations have yet to take full advantage of the management information at their disposal, but the increasing efficiency of the finance function provides finance professionals with the opportunity to promote and support the use of this evidence in strategic decision-making.
Finance business partners go beyond the production of standard reports and analysis to lead multi-disciplinary conversations that yield insights that inform and improve decision-making – and ultimately boost the performance of the organisation.
Mastering the role of finance business partner can also serve as an alternative route to senior management, due in part to the holistic view of the business that the experience brings, according to a new CGMA report.
Finance Business Partnering: The Conversations That Count is based on 25 roundtable discussions and interviews with senior executives representing manufacturing, retail, and public sector organisations around the world. The interviews revolved around the kinds of decisions finance business partners support and how they contributed to those decisions.
The research found that accountants generally need to develop new skills to become effective partners to the business. These additional skills are behavioural, rather than technical, and are most commonly acquired through experience in the role.
Anton Broers, a finance manager at Royal Dutch Shell, described these traits. According to Broers, effective business partners have:
- The courage to speak up, to challenge managers, and to hold a mirror up to the business. This might involve identifying and raising issues such as an unexplained escalation in a cost or an unintended consequence of a performance metric.
- Influencing, building relationships, and communication skills. These are required to get the message across and get a discussion going.
- Persistence. Challenging decisions and assumptions may not be welcomed by others at first, and helping peers from other disciplines understand the wider and longer-term implications of an initiative or action may take some time.
- Understanding of the business.
- The ability to translate the numbers into a business story.
An effective business partner is “the one who makes connections between people and between issues,” Broers said. “They will be sitting in the middle of the table brokering and linking up points, adding an overview and the financial angle.”
Influencing and communication skills are particularly important for making these connections. The research found that insights into how to improve performance are usually generated through conversations with colleagues in the business.
Management accountants bring their accounting toolkit but also their business overview, professional objectivity, and a commercial perspective to these discussions. They are not expected to know so much about the business as to be able to contribute insights into what can be done to improve the business performance. However, through stimulating conversations and asking questions, they can facilitate the development of insights in collaboration with business managers.
This series of conversations can help improve business understanding and generate insights:
- The business model: Developing the story of how the business works. The discussion helps everyone understand the business’s position, performance, and prospects, enabling the organisation to focus resources on how it actually generates value.
- Horizon scanning: Considering possible scenarios to identify opportunities to pursue or decide how to build the resilience needed to safeguard the business’ future
- Performance measures: Determining which non-financial metrics should be monitored to create meaningful performance data to support both current and long-term value creation.
- Data sources: Which sources of data at the company’s disposal can be utilised to create a competitive edge, and how to go about capturing, interpreting, and acting on those data.
—Samantha White (email@example.com) is a CGMA Magazine senior editor.