UK: More CFOs Focus Their Attention On Finance Business Partnering To Drive Business Value

Last Updated: 13 November 2012
Article by Deloitte Financial Services Group

Most Read Contributor in UK, August 2017

Finance functions in the UK's largest businesses are increasingly investing in finance business partnering to drive company performance. This is according to 'Changing the focus: Finance Business Partnering', the latest survey by Deloitte based on the views of Chief Financial Officers (CFOs) and Finance Directors from 134 major companies.

Finance business partnering, finance's ability to support the strategic and tactical priorities of the business; is increasingly viewed as the most effective way for finance teams to add value. Some of the UK's most high performing firms already fully embrace business partnering. A third (34%) are investing more than 30% of their time delivering these activities and a large majority, 83%, are expected to increase these activities over the next three years.

Overcoming the barriers to Finance Business Partnering

However, while many organisations have already started to invest in and develop finance business partnering capability, some challenges remain. Making the transition from back to front office is not always easy and in most cases it is recognised there is still room for improvement.

The key priorities for CFOs when looking to develop finance business partnering, as well as the corresponding challenges, are:

  1. Credible and accessible data, from both the internal and external environment, is essential to enable finance business partners to make more effective and informed decisions. However, almost six out of 10 (57%) respondents believe their finance systems - and therefore a lack of information - were a major barrier to effective partnering.
  2. Finance business partnering requires a new set of skills and behaviours; and developing and retaining a talent pool is critical for high performance. Despite this, over half (52%) don't believe they have the right capabilities in finance to successfully deliver business partnering.
  3. CFOs need to clearly define where and how finance business partnering can add value to the organisation and allocate resources accordingly. Worryingly, 40% of organisations believe lack of buy-in from the business is a barrier to partnering, which means organisations often don't understand the value it could add.

CFOs under pressure: delivering greater value to the business

Finance functions are under increasing pressure from the business to drive performance and, while most finance functions recognise the ability of business partnering to add value, they often struggle with how to add that value. Significant time can be invested in delivering finance business partnering, but more time spent does not necessarily equate to more value returned.

If business partnering is done well, finance becomes an integrated contributor to key business processes, such as target setting, forecasting, capital investments, risk management and governance. Improved data availability, smarter tools and access to broader people capabilities means CFOs now have the best information available to support them in making strategic and directional business decisions and act as a crucial navigator to the CEO.

Seeing beyond the numbers: Stepping away from the 'day job'

Unfortunately, implementation often falls down when the organisation fails to create a meaningful definition of the finance business partner role. Successful finance business partners are seen as leaders that can influence decisions a business makes beyond the numbers.

The survey suggests that finance business partners can benefit the business through making better decisions (76%), enable strategic initiatives (58%) and improve financial performance (56%). This indicates a move towards a more commercial skill set than has traditionally existed in finance and 64% of organisations see the development of commercial acumen/decision making skills, as their number one priority when developing their finance business partners.

Organisations need leaders, not only in the CEO but also the CFO, to navigate and steer the business through an often complex market. For finance to do this, gaining trust and buy-in from the business is critical. Within this context, CFOs and finance leaders must take action now to ensure that they and their teams are able to effectively step into the role of strategic finance business partner, and become a catalyst for change.

Read more about the 2012 Deloitte Finance Business Partnering survey

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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