Financial Planning & Analysis: Seven Tips for Business Partnering

Financial planning and analysis (FP&A) professionals today are spending more of their time and effort trying to work closely with the business – operations, sales, marketing, supply chain, HR – to find solutions, improve decision-making and drive better results.

According to Steve Elliott, director at The Hackett Group’s EPM Transformation Practice, business partnering has always been a key FP&A role. More recently, it’s been enhanced by technological advances as well as by the unrelenting pressure on business to do more with fewer resources.

“The availability of data, new analytics tools and technologies has improved over time,” he said. At the same time, “the role of FP&A is evolving from one of planning and reporting or being a gatekeeper for financial information, to that of a partner to the business.”

“FP&A is being responsive to the changing needs of the business; it has to keep pace to stay relevant and maintain its seat at the decision-making table.”

“Communication is at the heart of being able to build that credibility and achieve successful partnership . . . Don’t expect the business leaders to be mind-readers”

Elliott sees the role of FP&A changing to encompass higher-value services. “The partnering function is mirroring the business structure and the business needs; increased pressure on the business has translated into greater pressure on FP&A,” he said.

A big part of this new mandate relies on the strength of the interpersonal relationship between FP&A and business leaders, according to a new AFP FP&A Guide, How FP&A Can Become a Better Business Partner.

Here are seven tips for FP&A professionals seeking closer ties with their business counterparts:

Develop trust

Building trust is the first step in establishing effective collaboration,” according to Ketan Goculdas, director, FP&A at Sparta Systems, Inc. To make this happen, “credibility has to be established at the onset,” he said. “Do what you say you will, and follow through on your commitments.”

Next, ensure there is transparency and integrity in the process. “Once you establish trust and transparency, the decisions/recommendations/outcomes become much more acceptable to the audience,” Goculdas explained.

How FP&A builds trust will of course depend on the size of the organization, according to Nick Pennell, operations lead, Global EPM Centre of Excellence, at KPMG International. In a typical-size company, it’s incumbent upon FP&A to ensure the businesses have a “go-to” FP&A contact, either embedded within the BU or assigned within the FP&A team.

This allows the business and the FP&A professional to develop a mutual relationship. “The relationship is not with a function, it’s with a person,” he explained. Pennell recommends regular meetings to demonstrate that finance is taking the time to invest in solving the business problems.

Communicate

“Communication is at the heart of being able to build that credibility and achieve successful partnership,” said William Howell is the FP&A manager at payroll and HR technology provider, Ceridian UK. 

FP&A needs to be encouraged to see and know other parts of the business. And even if it can’t visit in person, meet with the business executives as they visit HQ.

“Don’t expect the business leaders to be mind-readers,” said Howell. It’s important for FP&A to clearly explain the budget and the plan in jargon-free terms.

Provide timely responses

According to Casey James, senior finance manager at The Cheesecake Factory, FP&A shouldn’t let requests linger in a queue. “Get it done in a timely manner, and don’t just answer the question but add something to it, a different perspective, information that’s actionable, an insight,” said James.

It’s also important to be visible and get to know people on a more personal level.

Combine formal with informal processes

At Ceridian, Howell is trying to push his team to make more informal contact with the teams across the business so as to better understand what they do, their resources and key business drivers.

“We need to understand what makes their business tick and what are the pieces they require in order to make good decisions,” Howell said.

According to Jenny Okonkwo with Transform Consulting, “You learn most of your information in informal settings, not business review meetings,” she said. “The trick is to make sure you are in a position to have these offline conversations and business managers trust you to be discreet.”

Many business managers won’t reveal their concerns during gatherings with management. She advised FP&A to “embrace the formal and informal agenda and treat them with equal respect.”

“When I do a finance transformation project, first I ask finance where they spend their time now and where they want to spend it in the future. Then I ask the business – and often I get a very different feedback”

Put operational performance in financial context

According to Scott Page, director of FP&A at YP, it starts with having a good operational model and being able to help connect the operational elements to the financial accounts.

“Functional leaders may not realize they’ve gotten out of step,” Page said. “The key is framing the analysis in the proper way so as to allow people to proactively look at their organization within the proper context.”

Spend time in the business

“By working in the business, you find out what are the exceptions to the rule,” said Ashley Merritt, former practitioner and now an independent consultant. “Always make a point of visiting with the business to talk about finance and the business and the challenges it faces.”

Be accurate and relevant

Make sure that information FP&A provides the business is accurate and timely, according to Rob Hull, CEO of Adaptive Insights. “It must also be data provided in a contextually relevant manner.”

He added: “The finance team member has to have the ability to sit with the business manager and provide both operational and financial data in a way that demonstrates how it’s relevant to that manager’s business.”

Ask the customer

Finally, to find out whether finance is really acting as a partner, and how it needs to improve, the key is to ask the internal customer.

“When I do a finance transformation project, first I ask finance where they spend their time now and where they want to spend it in the future,” said Maximilian Thomiak managing director, Accenture Strategy, CFO & Enterprise Value. “Then I ask the business – and often I get a very different feedback.”

“The point is that finance folks may want to be playing the role of a business partner but to a large degree they don’t. You have to provide the business with what they need to run their operations better.”

About the Author

Ira Apfel is Director, Communications & Editorial Content, at the Association for Financial Professionals (AFP), a US-headquartered professional society that represents finance executives globally.

Download the AFP FP&A Guide, How FP&A Can Become A Better Business Partner, which is available for a limited time to registered users of the AFP website.

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