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Partnering: Key to finance department success

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26th Oct 2012
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Finance departments need to work closer with other departments to help businesses make better decisions while protecting independence and promoting an ethical culture, according to a new CIMA report.

The report says that transformation of the finance function is leading to more partnering and collaboration.

However, the changing role of the finance department is not without risks: “Organisations and senior management should consider conflicts of interest and talent management and development when planning transformation.”

The report, based on discussions with finance professionals from large companies, also calls for an “ethical business culture”.

Without this there could be threats to independence and therefore threats to the sustainability and standing of the business it says.

Head of ethics at CIMA Tanya Barman said that finance staff need to feel confident that they will be backed by their senior managers if they raise questions over another department’s figures or forecasts.

“A marketing manager may say that their sales forecasts look great and the finance department shouldn’t block us,” she said.

Barman said bonuses for finance workers should not be based solely on reaching targets, which can be manipulated.

Criteria for awarding bonuses could include team work and helping a business comply with regulations, she added.

Other key recommendations of the report include: 

Set the tone, create the culture

The role of senior management, from the chief executive and CFO down, is pivotal in setting the tone in establishing and communicating the importance of independence and objectivity when implementing business partnering programmes.

They can help embed and reinforce the importance of objectivity in both the support and service roles that finance plays. This consistent message provides the finance business partners with credibility within the organisation and reinforces confidence in the professionals involved.

Develop relevant skills and competencies

Technical finance skills are paramount, however communication, influencing, negotiation and leadership are some of the new skill sets that are needed for successful partnering. These should be identified at the recruitment stage and incorporated into career development planning to maximise benefit to the organisation.

Keeping a reporting line to finance while working within a business unit is also important, enabling them to be part of the wider team and create the opportunity to escalate up the finance line when there is a need.

Rotation and secondment

Being rotated around the organisation can enable partners to gain a wide experience and understanding of the organisation and different functions, while also being open to different management and cultural business styles.

Standard Life case study: Business partnering in action

Financial services company Standard Life recognises the benefits that can arise from the business partner being clearly aligned to the business while remaining part of the finance function. In addition, the company seeks to rotate business partners on a regular basis as this not only enhances career development but can be good for the business.

The period of alignment needs to be long enough to create a team mentality, but ultimately the business partner is part of the finance team and independence is reinforced through this structure. The finance business partner will be assessed by his/her line manager with input from the business. Reward is not based on the performance of the business area they are supporting but of the overall company and personal objectives.

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