Key competencies for finance business partnering

As companies worldwide struggle with rapid geopolitical, demographic, technological, and competitive changes, finance business partnering offers an opportunity to create a strategic advantage.

The complex and volatile environment forces midlevel managers to make more operational decisions that can impact performance. In a 2018 global Gartner study, 61% of business decision-makers and finance executives reported an increase in the number of operational decisions in the past three years. More than half (57% of respondents) said operational decisions have financial implications and impact profitability.

The Gartner study suggests that poor operational decision-making could compromise upwards of 3% of operating profit before depreciation, and that is not a small number.

It is then no surprise that business leaders need and seek active partnership and collaboration from finance professionals who can understand the goals and overarching strategies of the business, analyse financial and nonfinancial information, and present recommendations to support their decision-making.

While business leaders are happy for the finance team to continue playing the roles of operator (FP&A, core finance, etc.) and steward (compliance, controls, etc.), today’s leaders want finance team members to increasingly focus on being strategists (collaborate with business folks to support strategy formulation and decision-making) and catalysts (challenge the status quo and champion finance as well as enterprise-level transformation).

In a loose way, the latter two roles form the essence of finance playing the business partner role.

Finance business partnering is what finance teams do when they create value by providing insights (often data-led), thus influencing their business counterparts to make better decisions.

The leadership hats I wore at Walt Disney Southeast Asia (and in companies I worked for before Disney) — including business operations, sales and distribution, general management, strategy and business development, and, of course, my core area, finance — convinced me of the difference such partnering can make to the business and, indeed, to one’s own career.

Now, as a leadership coach and corporate trainer, I like to champion this partnering through workshops, where I am often asked what skillsets equip a finance professional to be a good finance business partner. My response is that it requires a set of new and enhanced skills and a change in our mindset.

But ahead of all that, it is critical to get the basics right: Do the steward and operator roles really well; deliver timely, error-free financial and operating results with unquestionable data quality. Without high-quality systems and data, you will get bogged down in reconciliations and lose insight opportunities, draining your time and credibility as an effective partner.

Next, work on the key competencies required for a finance business partner. From my own experience on both sides of the partnership and my extensive work with business leaders, I have developed a road map that I frequently use in my workshops (see the chart, “Key Competencies for a Finance Business Partner”).

Key competencies for a finance business partner