Why Finance Business Partner is the new best route to a CFO role

By Andy Burrows

This will not be news to some of you, but taking a route through Finance business partnering is now the best way to achieve your ambition of getting into a CFO role.

It used to be the case that financial control and reporting was the established path to the Chief Financial Officer’s chair. A solid Financial Controller was seen as not only the CFO’s right hand person, but the CFO’s natural successor.

This, I believe, is not the case any more.

And the reason for writing an article about this is that it helps in guiding your development plans and career plans. At its most basic level that equates to thinking about the job moves you choose, and the courses you choose to take, after completing your accountancy qualification.

But, what’s changed to give rise to these changes in career paths?

The CFO is now more strategic

Firstly, the CFO role has become more about strategic partnering with the CEO and the Board, to maximise the performance of the business. I’ve pointed this out before, but think about the times you see the CFO fired (along with the CEO) by the investors because business performance is not as expected.

The CFO is now generally held responsible for business performance, and not just getting the accounts right.

The business is calling on Finance to help them

This then flows down such that each business area and department wants help from Finance to understand the finances, the control procedures, the strategy, etc, so that they make good decisions.

And therefore, we see the rise of Finance business partnering.

Accounting and reporting is becoming less onerous

Unlike many, I see automation as a driver, but not the driver, of change in Finance roles, learning needs and career paths.

But it is a fact that over the past few decades ERP systems and automation technology have made accounting and reporting more efficient in general.

And that trend will continue. The job is not finished. I don’t happen to think that RPA (robotic process automation), as a specific technology, is the white knight. But there are still plenty of opportunities to automate and become more efficient in accounting and reporting processes.

And we’ll continue to enthusiastically go for those opportunities because we want to remove the routine, boring, tasks that don’t require expertise or thought, or don’t add value.

What that means is that our expertise and brain power in Finance and accounting is being diverted nowadays onto questions of business performance, insights and decision making.

Finance is shifting towards business partnering

The consequence of those strands of evolution is that it’s less natural for the Chief Financial Officer to come from Financial Control and Reporting.

The CFO role is now more commercial and strategic, and control and reporting are less demanding. (I do admit, on the other hand, that the accounting standards frameworks and regulatory environment have become more complex and demanding. However, I don’t think that invalidates my arguments totally.)

The skills required for the CFO role and Finance business partner roles are on the same continuum

Those are the changes we’ve seen.

Because of those changes, we’ve seen Finance business partnering emerge on a spectrum.

At the more simplistic end of the scale we have Financial Analysts who are capable of explaining and engaging with their non-Finance colleagues to collaborate to extract insight from figures.

At the other end of the scale we have the Chief Financial Officer, who must influence and challenge across the business to ensure processes and activities are geared for maximum performance.

The rise of the Finance business partner is designed to support the CFO’s role in value creation and performance management.

The role of the Finance business partner, like the CFO, is partly to enable business areas (and in the CFO’s case, the business as a whole) to work effectively within a coherent strategic performance management framework.

That is to say, Finance business partners are to business areas essentially what CFOs are to the business. Hence, in one previous article I (somewhat controversially) described Finance business partners as “mini-CFOs”.

The consequence of this – and this is the significant point I’m trying to make - is that CFO skills are essentially well-developed Finance business partner skills. And conversely, Finance business partner skills are developing Chief Financial Officer skills.

To maximise your chances of being a CFO, develop Finance business partnering skills

The conclusion you can’t avoid, if you’re ambitious or you don’t want to specialise in one of the key technical areas (like Tax, Internal Audit or Treasury) is that to maximise your opportunities you have to develop Finance business partnering skills.

That involves both classroom learning and real-life practice in roles that involve increasing amounts of Finance business partnering.

And as an aside, don’t automatically assume that when I’m talking about Finance business partnering, I’m talking about a role with the title, Finance Business Partner. I’m not.

Finance business partnering, to me, is primarily a purpose-driven mindset, with a set of skills and behaviours to back it up. And these are the skills and behaviours you need in increasing measure in Finance roles that deal with business performance management. These are, admittedly, nowadays found mainly in FP&A. But I’ve also seen them in Financial Controllers and other more traditional Finance roles, especially in smaller businesses.

I’ll be writing more about Finance business partnering and CFO skills over the coming weeks, so watch out for those articles. Or register for the Supercharged Finance newsletter to make sure you don’t miss them.

Next time I’ll be looking into the three areas of skills and behaviours that both Finance business partners and Chief Financial Officers need to develop in. Don’t miss it!

 

And let us know what you think in the comments section at the bottom of the page...

 

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Developing Finance Business Partnering (The Purpose-Driven CFO Part 9)

How to Become a Great Finance Business Partner

How to Work with the Business as a Finance Business Partner

So You Want to be a CFO?

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