How will we win?

In the third of five viewpoints on business finance, we will delve into step three of how CFOs and organisations can build a strong business finance framework and strategy.

Now that we have defined the playing field for business finance, the next question is how to go about driving value creation by interacting with business stakeholders. One way of tackling this is by looking into underlying tasks to be performed by the finance business partner and grouping activities according to their characteristics and interconnections.

The characteristics of business finance tasks

The following is an example of how grouping activities according to their characteristics and inter-connectivity may follow a flow, such as the one presented in figure 3 [1].

Figure 3 - CGMA Report, Finance Business Partnering

A finance business partner for a sales team accesses relevant and accurate data. The finance business partner then pulls relevant reports to show specific performance to the team. Based on these reports, the finance business partner can perform analysis on deviations compared with the expected performance. The analysis leads to new insights and reveals additional relevant information to the team. The final steps involve the finance business partner communicating the information to the sales team to influence decision-making in a direction that the finance business partner believes will create the most impact and value. Understanding the characteristics, difference and interconnection between business finance tasks is the key to exploring whether time is spent efficiently in each activity group or whether some activi-ties take up unwanted or unnecessary amounts of time.

Finding the right balance between different business finance tasks

Decision support is at the core of business finance, however research shows that only 18% of time in the average finance function is spent on this [2]. Moreover, finance traditionally spends most of the time that is allocated to decision support on data, reports and analysis – the comfort zone of most finance profes-sionals. However, the biggest opportu-nity for value creation lies outside of this comfort zone, in the tasks of insight, influence and impact.

Figure 4 - Business Finance transformation

If so many finance business partners want to spend their time and efforts differently, why do so many of them fail to make the transformation needed to become trusted advisers?

Transforming business finance

Transforming the business finance organisation is, of course, the CFO’s responsibility. However, this does not need to be a huge investment or a task that rests squarely on the CFO’s shoulders. It can simply start with each finance business partner taking a look at themselves and thinking about what they personally can improve on.

Why are some finance business partners constantly overburdened and struggling with tight deadlines, while others in the exact same role are ready to take on new tasks and always find time to plan ahead? We believe that the answer lies in the ability to make time for work that really matters [3]. We need to focus on the most important tasks to be highly effective:

·      Eliminate time spent on less important activities

·      Delegate activities that can be handled by others

·      Redesign tasks so they require less time

This business finance transformation is in fact a personal exercise – it doesn’t require big investments in organisational redesign or technology. It is a five-step process: identify, categorise, offload, allocate and commit. In our experience, going through this process may enable finance business partners to free up one day every week and reallocate time for work that really matters.

What do you think are the right questions to ask?

This is the third of a 5-part viewpoint. Stay tuned for the next part to be released shortly. If you haven't read the first two, you can find them here What is our winning aspiration? and Where will we play?

If you would like the full 5-part version of the viewpoint, please drop me a message in the comments below and I will send it to you.

Authors

Claus is a partner at Implement Consulting Group and has more than 25 years of experience working in finance and advising CFOs on their transformation journeys.

This article has been written I collaboration with Christian Frantz Hansen and Nicolai Worziger.

At Implement Consulting Group, we welcome any opportunity to further discuss the topic of business finance.

Notes and references

[1] CGMA report (2015). Finance business partnering: The conversations that count. The Chartered Institute of Management Accountants.

[2] CFO.com (2015). Metric of the Month: How Finance People Spend Their Time. Retrieved from https://ww2.cfo.com/budgeting/2015/12/metric-month-finance-people-spend-time

[3] Birkinshaw, Julian & Cohen, Jordan (2013). “Make time for the work that matters”. Harvard Business Review.