The rise of business-focused Finance - what's it all about?

By Andy Burrows

Those who have followed me for a while may have noticed that I’ve started using the term Business-Focused Finance. And I want to unpack what I mean by that over the next few weeks, starting today with this overview.

You may be wondering whether it’s actually just the same as Finance business partnering. Or is Business-Focused Finance something different?

And to answer that question right up front I’d say that a large element of Business-Focused Finance is Finance business partnering, but I’m thinking of Business-Focused Finance as something broader.

Finance Business Partner is a specific role often seen within Finance, designed to give various non-Finance functions access to the full power of the Finance function in managing business performance within their areas.

Finance business partnering is a phrase that’s either been used to describe simply what Finance Business Partners do, or to describe the kind of mindset needed within Finance.

I think that’s confusing.

I also think that it’s unrealistic to think that having Finance Business Partner roles will be viable in every organisation. It’s not a one-size-fits-all concept. It tends to suit large, and especially very large, organisations, with reasonably complex group structures and multiple locations.

How many times can we say, “you may not be a Finance Business Partner but that doesn’t mean you don’t do business partnering” without getting the Finance and Accounting profession in a muddle?

The truth is that not everything we do in Finance is business partnering.

And even though I still maintain my stance that the main purpose of the Finance function is to drive business performance, not everything we do in Finance is related to business performance management.

Is Corporate Tax planning related to business performance management? No!

Is doing VAT returns related to business performance management? No!

Is statutory and regulatory reporting related to business performance management? No!

But that does NOT mean that those things don’t add value!

What we need to recapture, in my view, is the purpose of the whole of Finance.

Do you want to be helpful?

The starting point for business-focused Finance is recognising that whatever Finance does, whether it’s related to performance management or not, whether it’s business partnering or not...

... Everything that Finance does is to help the business ... And helping the business is, by definition, helping it to perform better. Otherwise, why would the business bosses want you to do it?

Another way of putting it is that Business-Focused Finance is the same as purpose-driven Finance.

The reason, the purpose, behind everything that we do in Finance is to help the business in some way.

We need to recapture that, and get it in the front of our minds, and let it influence the way that we work.

Now, that may seem like (to use the English vernacular) “stating the bleeding obvious”! However, how often do we lose sight of the obvious goal and end up down a rabbit hole?!

I guess, also, you could argue that every function and in fact every employee within a business is there to help the business! After all, why would you employ someone or organise departments in a business if they didn’t help in some way?

That’s true! And in that sense, everybody and every function in an organisation should be thinking in this way. Wherever I work within the business, how does my job help the business? And how can I do it better to help the business more?

However,...

I am convinced that this is particularly valuable for Finance to appreciate. And I’ll come back to why that’s the case in a minute.

A very good question...

But first, let me explain what led me to thinking about this.

I was doing a live masterclass with more than a hundred CFOs and senior Finance leaders, and I was telling them how Finance drives business performance through helping the business to manage performance better.

In the Q&A afterwards, one CFO asked a very good question. He said, “I agree with everything you say, and I would love to be more involved in managing performance and to be a Finance business partner. But what can you do when you’re in a small business, where the CEO and the Board is made up of the family that owns the business, and all they want you to do is to be a good accountant and give them reports every month?”

My reply to that was to encourage him not to lose heart, and to remember that if you’re employed to take care of the accounts, the tax and the reporting, then doing that solidly and reliably is giving good value to the business. If that’s what they want, then doing it well is being a good Finance business partner.

However, that doesn’t mean you can stop thinking about business performance management!

You see, non-Finance colleagues don’t necessarily know how much they could benefit from listening to you a little bit more. (This is true the other way round too. I sometimes think, as a small business owner, that I know how to do my marketing... until I get chatting with a marketing professional!)

So, by all means start with the remit you’ve been given. Do it well. Build trust and credibility. And naturally share your insights with sensitivity.

And the way to be ready to do that is to learn to be business-focused. And keep learning. Keep practising. Because we tend to share naturally the things we learn and the insights we come across.

Why is business-focus particularly important for Finance and CFOs?

But let’s come back to the question of why being “business-focused” isn’t just a general thing to be urged upon everyone in business. It’s something that particularly needs to heard and heeded in Finance.

It comes back to the fact that Finance is the only function within the business that gets to see and be involved in every area of the business.

We deal with every transaction, because every transaction has financial consequences and requirements. And every area of the business has some part in transaction processes.

So, in order to report, control, budget, forecast, model... Finance has to understand the dynamics of business performance and how the organisation fits together to perform well.

This is why, I believe, as businesses get bigger, investors and business owners look to the top Finance person with the expectation that they will enable the business to perform better.

In short, CFOs get fired if the business underperforms.

And if that doesn’t make sense to you, think in terms of sports teams. I’ve often drawn the comparison that soccer coaches and managers don’t get on the pitch and play in matches, but they do make a big difference to team performance. Think Pep Guardiola. Think Sir Alex Ferguson. Think Jurgen Klopp.

Soccer coaches and managers also get fired if the team underperforms.

Similarly, the way that soccer managers make a difference to performance is by providing the performance management framework, tools and processes. They provide the technical coaching, the fitness regime, the nutrition and diet advice, the performance review, the tactics, and so on – all focused on managing and driving performance.

And the core Finance processes that the CFO is responsible for are focused around managing performance.

So, the CFO needs to be business-focused. And if you want to develop as a Finance professional and a Finance leader in business, you need to be business-focused, whether you’re a Finance Business Partner or not.

The skills and behaviours of successful CFOs

I’ve made the point in another article that the skills and behaviours needed to be a successful CFO are on the same continuum with Finance business partnering skills.

In that article I said, “CFO skills are essentially well-developed Finance business partner skills. And conversely, Finance business partner skills are developing Chief Financial Officer skills.”

I’m now generalising that argument by saying that you don’t have to have a Finance Business Partner role to develop Finance business partnering skills. And those skills and behaviours are the skills and behaviours of business-focused Finance.

So, as I wrap up this overview of business-focused Finance, briefly, here are the categories these skills and behaviours fall under:

1.    Business acumen – the understanding of how business works, how business and performance is managed, and how to interpret financial information;

2.    Behavioural skills – the ability to build relationships, work effectively and with focus, communicate well and create synergies with the business;

3.    Tools and techniques – the understanding of various management and management accounting techniques and methodologies, such as the Balanced Scorecard, LEAN process improvement, Activity Based Costing.

I’ll go into a little more depth in each of these areas over my next few articles. But I hope that’s given you some good food for thought to be getting on with. Feel free to let me know your thoughts in the comments below!

Learn More

Don’t miss my new articles – click the Follow button at the top and bottom of this article!

A couple of earlier articles on similar topics:

Why Finance Business Partner is the new best route to a CFO role

If you want to be a CFO, develop these three skills

Synergies are not cost savings to the best CFOs

For online learning products to help Finance professionals help their business, visit the Supercharged Finance website and get on our mailing list!

Download my free short guide, How Finance Can Drive Business Performance.

And if you really want to level up in your business-focused Finance career, consider joining us in the My Finance Coach membership, for training, coaching and community for your personal growth and business impact!

About the Author

Andy Burrows is a popular Finance writer and experienced senior Finance professional.

Having founded Supercharged Finance in 2016 to encourage Finance professionals to pay more attention to the way that Finance can boost business performance, he continues to write articles and develop learning material, books and online courses, to that end.

In terms of history, he qualified as a chartered accountant in public practice in England in the 90s. And he’s worked in a variety of businesses of different sizes and types in senior Finance roles since he made the move into industry and commerce in 1996.