Finance business partnering: Noel Cullen and Shetal Patel explain why effective business partnering can be an elusive goal--and offer their tips on how to make it work.
| Author | Cullen, Noel |
| Position | Technical matters |
Most companies have driven out costs and improved accuracy through their investments in enterprise resource planning (ERP) systems, shared service centres and outsourcing. Their finance departments now focus on creating value by providing proactive, business-aware support for strategic programmes and by advising operational managers, allowing them to gain insights into the issues facing the business and make evidence-based decisions.
Many organisations have created finance business partner roles. But too often these fail to deliver the anticipated value. Why has a gap developed between the aspiration and reality of business partnering and how can firms ensure that they get a return from their investment in transforming finance?
Time and again, organisations fail to get the business partner role right. The individuals in these jobs struggle to move from accounting to being full strategic partners, leaving the rest of their team unable to meet the high expectations that have been set for them.
There are four main barriers to success:
* The role is created on the assumption of a business need, but managers often neither understand nor value the role of the business partner, while finance cannot convince them that its insights can create value.
* The data is not trusted. The increasing use of ERP systems, outsourcing and virtual information has led many operational managers to distrust--often with good cause--the integrity of the data provided by these systems. This strips finance business partners of credibility.
* Many organisations merely re-label traditional accountants as business partners and fail to invest in developing and recruiting people with the necessary skills. This again reduces the credibility of the finance function.
* A lack of commitment at the top, especially when an organisation still operates in silos, hampers communication and reduces trust in new partners.
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These barriers can force business partners back into their traditional cost accounting roles. They continue to focus on getting the numbers and information right, rather than analysing the broader business to support executive decision-making. This undermines the benefits that the organisation has gained from transforming finance and reduces its ability to identify and exploit new commercial opportunities.
A recent survey by Sage found that 27 per cent of UK managers had difficulty communicating with their finance departments. This figure was far higher for finance than it was for other support functions. The result is a widespread belief that business partners are failing. But the roots of this failure lie elsewhere and start long before people take up the role.
The problems usually begin when the finance function fails to think through the...
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