5 Traits of an Effective Finance Business Partner

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Partnering with colleagues to improve business performance is a key concern in this post-financial-crisis era, and management accountants are uniquely positioned to become finance business partners, according to a new CGMA study by the American Institute of CPAs and the Chartered Institute of Management Accountants.

In Finance Business Partnering: The Conversations That Count, the study makes the case that the business world is in a similar position now as it was at the end of the Cold War: volatile, uncertain, complex, and ambiguous.

“The post-crisis political, economic, and social environment, and the pace of change will not provide an easy era for business,” the study states. “The world has become flatter and it is becoming more volatile. This means that there will be fewer opportunities for companies to find sources of competitive advantage, and there will be new crises ahead. Increasingly, the quality of decision-making will become the discriminator of business success.”

And that's where management accountants enter the picture.

“With their unique combination of professional rigor and objectivity, technical accounting and analysis skills, and an overview of the business, management accountants engaged as finance business partners can cascade the influence of a CFO throughout a business,” the study states.

So exactly what is finance business partnering? It's a combination of accounting disciplines and an understanding of a particular business, which then allows an analysis, which then influences decision-making and “performance management.” And the goal, of course, is generating or maintaining value in the eyes of stakeholders.

What's critical, though, is that decision-making isn't biased. It must be made based on analysis and in the stakeholders' interest. Management accountants as finance business partners could be the solution, the study states.

In the study, Anton Broers, finance manager at Royal Dutch Shell, described the top five traits needed for finance business partners to be effective:

  1. The courage to speak up, to challenge managers, and to hold up the mirror to the business.
  2. Influencing, building relationships and communication skills, and being able to get the message across and get a discussion going.
  3. Persistence – the message might not get through on the first attempt.
  4. Business knowledge – business partners must understand the business.
  5. The ability to translate the numbers into a business story.

Yet, there are pitfalls in that effort. Effective finance business partnering is still a challenge for many businesses, the study states. Accountants may not be regarded as having sufficient business know-how or soft skills. The latter, in fact, may be the most critical because it is “through relationships, participating in conversations, and asking the right questions” that accountants can help in decision-making, the study states.

Questions to ask include:

  • How do we generate value?
  • What are the causal links between inputs, activities, intangibles, outputs, and outcomes?
  • What are our nonfinancial success factors and intangibles?
  • How do we develop our business model to ensure long-term success?
  • What do we need to measure and manage?
  • What data do we need to manage our performance?

“As businesses adjust to a new post-crisis reality, management accountants have an ever-more important role to play in ensuring that the information decision-makers need is filtered up to them,” the study states.

About Terry Sheridan

Terry Sheridan

Terry Sheridan is an award-winning journalist who has covered real estate, mortgage finance, health care, insurance, personal finance, and accounting and taxation issues for newspapers, magazines, and websites. A Chicago native and former South Florida resident, she now lives in New England.

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