The basics of business partner functions

Much has been written and discussed in recent years about the evolution of finance within the organisation – large parts of it focused on the role of finance in partnering with the business.

This has focused on three main areas of change which CFOs see as essential in extending the reach of finance into the business, namely technology, skills and talent.

 

However, there are other fundamental areas which finance leaders must address to ensure they are maximising the opportunity:

1. Getting the basics right

Two plus two must equal four; and it must equal four across the business

The success of any business partner will be based in other parts of finance. The core finance function must demonstrate its ability to perform the two fundamental elements of finance, namely accurate reporting and good stewardship. In businesses where these two are not delivered, then the impact of any business partner function is undermined.

For example, a leading FMCG company, with a newly established “commercial” finance function spent many months just getting to square one, by investing all their time in getting the sales and cost numbers consistent across reports, before the Sales Director would even countenance involving the team having involvement decision making. Put simply, two plus two must equal four; and it must equal four consistently across the business.

2. Exerting a positive influence

The core function of any business partner is to influence decision making

Whist there is much talk of “how” finance will influence there is little talk of “what” and “why”. The core function of any business partner is to influence decision making. The need to identify the major decisions which will be taken in the business, who will take these and where they will be taken sits at the entry point to influence. The “what” element of these can be at several layers from the operational to the strategic. Guidance from leaders will help to set the agenda for any business partnering team, but they must also take into account feedback “from the field”.

When searching for a route to establish credibility it is important to see what the issues are that are concerning the business. In the same FMCG business, overspend on investment with retailers was a considerable concern, both to the Board and to the individual sales teams. Setting in place a simple evaluation mechanism for investment, and an approval process, was enough to convince the Board that controls where in place, and the sales teams that finance were there to help, not to hinder. From that point, the ability of finance to influence was firmly established.

3. Joining up the dots

The line responsibility must remain in finance

Finally, leaders must ensure that they are structurally prepared to accommodate partnering. Alignment to the business is fundamental to this. Whilst it is not always possible to replicate the entire business structure, making sure that sales and operational leaders have their own point of contact is vital to creating the relationship. However, the line responsibility must remain in finance. Fundamentally the role is to develop the understanding and influence of finance principles in the business, not to pursue the interests of the business in finance.

Establishing whether the partnering function is purely responsible for business liaison or will also perform the data collation and reporting is another important factor here.

A final thought

These three issues are merely some of the basics for beginning the journey to a successful business partner function. My next blog will deal with developing the role into a more effective and influential part of the business.

I hope you found the above information interesting and useful – please see below for links to other financial markets blogs which may be of interest to you and your teams:

• The basics of business partner functions
• Business partners should be seen, and heard
• Too much pessimism clouds silver lining for China’s economy
• Digital destruction: Could Fintech kill banking jobs?
• Intrapreneurship and labs: How banks are fostering innovation
• China stock market jitters: Keep calm and carry on
• Marty McFly, Twitter & better Investor Relations
• How banks are changing old ways to attract Millennials

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