How to Become a GREAT Finance Business Partner

Presuming you are in a Finance Business Partner role (or want to be) how does someone develop their A Game? How do you become a valued partner in the business?

#1: Become a Student of the Business

#2: Learn the Area You Support

#3: Build an Internal Network

#4: Learn How to Construct a Solid Business Case

#5: Perfect Your Presentation Game

#6: Look for Opportunities to Improve the Business

#7: Develop Project Management Skills

#8: Build On Your Technical Expertise

#9: Be Accountable

Tip #1: Become a Student of the Business

You can’t provide effective decision support if you don’t know how the business works, what really drives (not just influences) success.

For example, a Business Partner at a Waste Management company explained to me why route planning and aligning sales performance incentives was so critical to the business. This was not obvious to her at first. She originally thought it was all about the hourly wages paid and how many new customers could be added. Those factors influence success, but they don’t drive it.

The Waste Management model isn’t hard to understand, the challenge is in execution. The more locations a truck can service in a day, the more productive the business will be. Route planning (via Critical Path and other forms of analysis) is key to optimization. But customers are not always clustered in a way that optimize the route. That’s where Sales come in.

In the old world salespeople in this particular waste management company were paid on the purely on the value of the contract, and as a result new households were scattered. The decision (proposed by the Finance Business Partner) was made to incentivized account executives to sell to existing neighborhoods in order to optimize clusters. The result was profitability rose by 43% in just a year.

There’s obviously more to it, but the Finance Business Partner invested her time to learn the business and discover what really drove success – route planning and providing the right Sales incentives. Armed with that knowledge she was able to work with a cross functional team to deliver real transformation.

So... what drives success in your business?

Tip #2: Learn the Area You Support

Apart from understanding the business, Financial Planning & Analysis (FP&A) professionals also should understand the issues and language of the departments they support.

For instance, the challenges of the logistics department are quite different than those of marketing or human resources. Each functional area needs a Business Partner to understand its unique challenges and how it runs its side of the business.

Many of the more successful FP&A professionals will take practical steps to get to know the department they serve, such as attending weekly staff meetings or facilitating monthly reviews of plan vs. actual results. That way when the planning (or forecasting) cycle starts up again, they are already part of the team.

One great example I know is from a woman working as a Business Partner for one of the largest Utility companies in America. She was assigned to the Operations department, and specifically to the maintenance area. To learn what the department really did, she volunteered to go out with a maintenance crew every month (start time 5AM). Over a short period of time she earned the trust and respect of the department. As one person put it “You’re the only person in Finance that has ever seen what we actually do.”

Tip #3: Build an Internal Network

It’s essential to build good working relationships with people outside of Finance. Why? People on the front lines actually know better than anyone what’s going on in the business.

It isn’t enough to know that profit came in less than expected because cost of goods sold was higher than planned. That’s an accounting answer. Instead, discussions with the production manager might reveal the company faced a stock-out of a key material that had to be air-shipped at considerable cost to meet customer demand. Further business analysis may reveal that the demand forecast was significantly off. To help safeguard that this doesn’t happen again, the analyst might meet with the sales manager to determine if this is another reason to implement the new sales and operational planning process proposed the previous month and currently under review. All of these findings are more probable through solid working relationships with those outside of the finance department.

The “people side” of business partnering does not come naturally to everyone, especially those who got into accounting because they feel more comfortable with numbers than with people. But breaking out of your cubicle and comfort zone is critical to being an effective business partner.

Tip #4: Learn How to Construct a Solid Business Case

Beyond traditional financial modeling, the ability to develop a business case is another skill that is increasingly in demand.

A business case involves ROI analysis but it goes beyond that. A solid business case documents how the investment would advance the strategy of the organization, detail the resource requirements and team structure, estimate the implementation timeline, outline alternatives considered and why the team chose a certain path, and finally how to best package and present the proposal.

The people who are really good at at building a compelling business case become sought after business partners.

Tip #5: Perfect Your Presentation Game

Finance Business Partners need to be able to communicate effectively with the rest of the organization.

Consider the monthly management reporting package that provides variance analyses to help executives understand what happened in the business and why. Ask yourself: How clear and meaningful are the variance explanations? Could anyone in the organization read it and understand what is being communicated? Consider all the exhibits, reports, and templates used in the annual plan or monthly forecast. Do people outside of the finance department understand them and what they are used for? Are there actual business decisions being made based on these reports? If not, is that an indication of their lack of utility?

To find out, ask the people who received the reports.

Finance Business Partners often make presentations during the planning process, as well as during monthly reviews, comparing actual results to the forecasts for the period. How those presenters express this information can either help executives grasp the issues quickly or leave them confused.

One common complaint to avoid is that finance people will display a chart crowded with data in small font and begin by saying “as you can clearly see…” The presenter hasn’t adequately provided context for what’s on the slide nor explained what’s on it. They’ve jumped right in, assuming the audience knows much more about what they’re looking at than they actually do.

Tip #6: Look for Opportunities to Improve the Business

Finance Business Partners are often in a “support role” and a lot of what we’ve talked about so far is in line with that. But the most sought-after Business Partners are those with a well-informed perspective, who can spot opportunities for improvement, voice them, and build internal support.

For example, when I was at Pepsi Cola International supporting Supply Chain operations, I remember looking at a map of all the warehouses devoted to housing concentrate (which in turn was sold to bottlers). I thought “What if we had no warehouses today, we had a clean slate. Where would we optimally place those warehouses and how many would we have.”

Using and optimization model (with the volumes and locations of all of Pepsi’s bottlers) a cross functional team I led identified that the company needed only one warehouse in a geographically desirable location. The senior executives bought into the recommendation and the company registered multi-million-dollar savings.

Finance people can feel uncomfortable “skating out of our lane” but it’s not a matter of directly making decisions, rather it’s about asking interesting questions and working with a business team to answer them.

Tip #7: Develop Project Management Skills

This one might sound far afield from Finance, but if you’re looking to make a dent in the business you need to be involved with change.

Let’s say you want to make the current budgeting/ forecasting process more effective and efficient. Perhaps a redesign of the process is the answer, or maybe some enabling technology is the solution. Whatever path is chosen, we know it involves more than flipping a switch. A project charter should be drafted to document the scope, goals, objectives, resources, team structure and so on. Then you'll need to define the right sequence of activities and tasks, with deliverables and due dates. Things won’t go exactly as planned and adjustments will need to be made. All of this is part of Project Management.

Things can get more complicated when cross functional teams are involved (think about redesigning your Sales & Operational Planning process for example) and all the more reason to have a good grasp of Project Management.

Even if you hire outside consultants to do the work and take responsibility for successfully delivering the project, the more you know about Project management the better position you will be in to monitor and assess their progress and results.

Tip #8: Build On Your Technical Expertise

I intentionally moved this down the list, because most of you will already be considering the technical side and you’re on it. Yet it’s worth mentioning.

The number of technical skills that all Finance Business Partners are expected to have keeps increasing. AI, machine learning, business analytics, data security and storage, data visualization, are now part of what Business Partners are expected to have a perspective on. Of course return on investment (ROI) and net present value (NPV) development and analysis, financial modeling, forecasting and budgeting, variance analysis, cost and profitability management, are always critical skills to look to improve.

Tip #9: Be Accountable

I’d like to leave you with this one. Trust is the currency of good working relationships, and its foundation is built on doing what you said you'd do when you said you'd do it.

Whether it’s delivering value-added variance analysis, conducting a profitability assessment, implementing a new Business Intelligence system, reporting on month end results, developing and business case for an investment, or a multitude of other examples – be accountable for getting it done. None of this is easy and obstacles abound, but don’t let anything stand in your way. Improvise, adapt, and overcome.

A SPECIAL NOTE FOR HIRING MANAGERS

It’s easier to hire people with these skills and know-how than it is to train them. Look for “natural athletes” -- people who can deal with ambiguity, take initiative, embrace influence without authority, have intellectual curiosity, and are not afraid to go where they don’t belong.

For more on this you might want to learn more about The Lominger Model.