Treasury Today Country Profiles in association with Citi

Finance professionals need partnership skills, says report

Tidy business work desk

For key financial professionals, partnering with non-finance functions enables improved responsiveness throughout the company. But to succeed it also requires additional skills that are not always readily available. What is required and what can be done to improve matters?

A lack of broader-based business skills is forcing finance executives to recruit externally to meet their company’s strategic goal of closer organisational partnerships, according to a new European survey of key finance professionals. Although the vast majority said forging closer ties between the finance department and other parts of the business was necessary to improve agility and rigor, it is proving difficult. Almost three-quarters of respondents said they have to look beyond the company for the right people – and around a third claimed they faced recruitment and training issues amongst existing finance staff.

The findings are based on a survey of 1000 group or divisional finance directors, spread evenly between the UK, France, Belgium, Germany and the Netherlands, carried out by Robert Half Management Resources in collaboration with Longitude Research. The results show that although 81% of finance executives are regularly asked to support other parts of the organisation through business partnering, 33% said they find it hard to find candidates with the right experience and 58% cited difficulties in retraining traditional finance employees to take on the business partnering role.

The study, ‘Business partnering – Optimising corporate performance: An independent report on the expanding role of finance teams’, highlights a number of reasons why finance partnering has risen up the corporate agenda in recent years. The list includes increased business complexity, more intense competition, technological changes and greater business volatility.

Around 64% of respondents believe that economic uncertainty has increased the need for the finance function to develop business partnering capabilities. However, 24% of respondents reported that they struggled to implement business partnering properly, whilst 50% claimed to have a finance function that had been fully embedded across the organisation.

In seeking the right finance professionals to fill the expanded role, 70% of executives questioned said that they had to look externally for the right skills, with 35% hiring additional permanent staff, 35% hiring interims and only 30% planning to develop existing skills in-house.

Beyond the call of duty

In seeking to optimise overall business performance, notably in providing support for better business decision-making and improving organisational risk management, 81% of respondents stated that they wanted to form stronger partnerships between the finance department and other parts of the business. In practice, across all countries, only 45% reported that their finance function worked in close collaboration with other business functions to develop overall strategy and 44% said that financial skills were actively used to challenge management assumptions.

Why partner?

The survey finds a range of drivers for partnership between functions. Of the UK-based respondents, 64% cited economic uncertainty as the most pressing reason. Volatility has pushed forward-looking decision-making to the top of the agenda for 60% of respondents from all countries, with 51% using collaborative teams to help forecast future business performance.

Despite the apparent benefits, 24% of UK respondents said they struggled to implement business partnering properly and only 50% had failed to fully embed the finance function across the organisation. Of these, 26% cited the finance department’s lack of influence amongst the broader business and 25% cited lack support from senior management as the reason for lack of progress. Insufficient resources (24%) and the demands of their more traditional finance role (18%) followed, with 15% claiming that there were organisational boundaries between functions preventing more co-operative work.

According to one respondent, Gary Rourke, Vice President Finance of global pharmaceutical firm, AstraZeneca: “If finance business partnering isn’t positioned as actually making a difference to the business, whether that’s improving the quality of decision-making or optimising business performance, then it’s very difficult to really sell the value of business partnering to the broader business”. Another respondent, Thibault de Tersant, Executive Vice President and CFO of Dassault Systèmes, a 3D design-software business, is quoted in the report as saying: “Someone who’s just sitting back and preparing analyses is not that useful. Finance partners need to be willing to step up and survey the problem, and propose solutions in order to deal with it. They need to show initiative and leadership.” Antoine Bayon de Noyer, who led a global partnership programme at corporate travel management firm, Carlson Wagonlit Travel, commented that to succeed business partners “need to show initiative”.

Finding the right skills

“You need people who can strategically influence the business segments they support,” said AstraZeneca’s Rourke. “They need honed communication skills so they can provide insights in a concise, impactful manner, and they need to be able to communicate in a way that translates to non-finance people.” The expanding role of finance requires new skills but 29% of all respondents said they had problems sourcing candidates with the right experience. This was the finance function’s main barrier to effective business partnering, with capabilities in short supply including leadership (cited by 27% of respondents) and project management skills (24%).

In the external pool of talent, although 58% of executives believe there is adequate availability of experienced finance professionals, just 18% considered that talent to be strong. Furthermore, it was reported that 58% of UK executives found it very difficult to retrain traditional finance employees to take on a business partnering role.

The route to success

The highest proportion (49%) pointed to the use of shared services as the main source of success for a business partnering project, while 47% saw a need for greater support of business partnering among senior management and 45% wanted to see more investment in data and IT for better analysis. Around 36% called for increased budgets for finance to handle the additional work that partnerships bring.

Being a good business partner will see some departments “treading on toes”. “The CFO and senior finance staff might not be the most popular people in the business – particularly if they are doing their jobs right – by stopping the company from undertaking initiatives that are value destroying or too risky,” commented Frank Plaschke, Partner and ‘Office of the CFO’ specialist at Boston Consulting Group. The key to winning people over, he advised, is “to be respected for understanding the business needs, but also for asking probing and challenging questions”. Another respondent, David Smith, CFO of vacuum pump producer, Edwards, noted that “the best finance functions are able to do that in a way that gains respect but, at the same time, really suggest ways to add value to the business”. This, added Smith, “is the difference between a good finance department and a weaker one”.

Business partnering checklist

Robert Half Management Resources’ five steps to get companies started:

  1. Establish specific inter-departmental objectives that align with the overall business strategy.

  2. Assess the competencies that already exist in-house, establishing which team members bring the technical, business and communication skills necessary to partner with other business units.

  3. Ensure they understand each department’s objectives and have access to the necessary data to support their key initiatives and goals.

  4. Consider engaging an experienced interim professional to help manage the transformation to a business partnering environment.

  5. When hiring new key finance personnel, look for candidates with the essential partnering skills.