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How Should Finance "Market" and "Sell" Itself to the Rest of the Business?
Finance affects and is affected by nearly every business activity, but many outside of Finance have little to no idea of how Finance works or what it really does for the business. How best to change this -- or does it need to be changed? Should Finance issue regular proactive financial snapshots of the organization to help others plan budgets more effectively? Or should Finance remain sequestered from the rest of the organization until and unless compliance or reporting requirements dictate otherwise?
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5 Answers
This is the type of question that makes one cry a little. Those of us in the profession see our value every day; outsiders can believe we are little more than a nuisance. In fact, I have seen too many situations where other departments work actively against Finance believing that accurate disclosure of their departmental issues will work against them. In their mind, controls and procedures take time away from whatever they think is more important. Worse, when Finance reports the "wrong" earnings per share, Finance is blamed rather than the poor operations of the company.
There is no easy answer to this, and one of the reasons for the short tenure of many CFO's is that there is no right answer for many companies. From my experience, the right answer, regardless of results, is not to roll over and play dead. Until whatever the end is, we need to do our job in the best way we can.
CFO's and financial managers need to watch their backs; office politics and be biting. Stepping back and wishing this kind of behavior will go away just won't work. Where it hampers our efforts, it needs to be confronted.
Regardless of the issues, Finance needs to take the high ground and do what is best for the business, not what is best for PR or avoidance of conflict. The senior managers of any business need accurate and actionable information and it is the finance group's job to make sure this information is there. So we should not be shy in seeking it. If top management is the problem, there is little we can do about it, but we always should do our best to keep the best information in front of management regardless of what they do with it.
Michael,
That is such an excellent question! You're right, it is a "sales" job, and we accountants aren't exactly known for our sales savvy. That said, keeping Finance on the outside is a sure-fire way to let down the team.
Finance is two things - a massive data pump and a significant management resource.
As a data pump, Finance sees every transaction the business is involved in. When you think about it, Finance SHOULD have a better idea of the overall picture of the organization than any other department can. Finance needs to package that data, organize it for easy consumption, and pass it out to "feed" the other departments.
As a management resource, Finance should be helping other executives connect the dots between departments, between strategy & execution, between internal & external stakeholders. There are so many opportunities that Finance members have to streamline operations and facilitate decision-making that it would be wrong to keep that under wraps.
So, then, "how"? First step is to understand the business. Controllers, AP & AR managers & staff are always in contact with operations, whether to collect on outstanding AR, to help understand the coding for a vendor's invoice, to get background on an expense report - we need to take those opportunities to not only ask for information, but to educate operations about how they can "use" finance more effectively. Fill in the expense report correctly, with JUST these 4 fields, and you get paid faster. Help to collect on closed business, and you get your commission faster.
As keepers/preparers of the budget, we also need to do a lot more to simplify budget development & compliance. One great way to do this is to avoid "budgeting" and focus on "planning". Instead of providing accounting-friendly budget "templates", work with your managers to develop "planning workbooks" that make it easy for the manager to plan their actions; link those workbooks to your budgeting/forecasting, and many budgeting pains & roadblocks will fall away.
The key to selling finance is to realize it's strengths - it is a uniquely positioned management resource, a support organization. It needs to operate as such, and encourage others to "use" it wisely & effectively.
The two key places where Finance must be successful are:
1) Accounting and Control as they are the final gatekeepers to the company's books and are responsible for safeguarding company assets.
2) Being a business partner to all functions as Finance brings a unique perspective and tool kit.
To be sure, Accounting and Control must be the higher priority, but Finance without business partnering is the reason the dreaded "bean counter" label was invented.
Given the above, in order for Finance to be a major player and add significant value, Finance needs to be visible and be an integral part of the executive and management teams for reasons that should be obvious to the people in this forum. Finance organizations that are sequestered from the rest of the organization cannot add their perspectives, insights, guidance, etc effectively.
The only way to have Finance be that key business partner is to earn it. You cannot mandate it or sell it artificially. If the Finance organization is truly adding value, then in the long term, employees in other functions will seek Finance out for advice and input.
I recently attended an industry forum for Direct Response businesses in Tampa where Ancestry.com presented, "Positive Visibility for your Payments Department - Its' Good Business!" to help each attendee promote the benefits of payment processing awareness within their company. How the Payment Manager and her dept. created and implemented a successful program including newsletters, training modules, videos, sharepoint sites and other tools and activities utilized to not only raise their visibility/value, but enhance operations. As I've actually written a success story about this company who uses our payment processing engine and reporting module, I've heard first-hand how a payment processor's consultative approach and reporting capabilities can enhance the value the Finance dept. brings to the company (from cost reduction, revenue growth, and operations streamlining). Having the right tools and people behind your payments can make a big difference in whether you want to "sell" yourself to the rest of the company, or not.
Actually the role of finance in an organisation is better assumed than appreciated.Notwithstanding, finance department remains the nucleus of every successful organisation.
I beleive finance department with all it's importance in an organisation cannot function in isolation of other units.Therefore,finance should re-align their roles with every other units in an organisation and improve on the level of communication with every other deparments on their positions regarding various issues in an organisation and on time.
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