How FP&A Becomes A Strategic Partner To The Business

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What is the most important issue to focus on for CFOs in 2021? It is for FP&A to become a strategic partner to the business. This is what The Hackett Group’s Key Issues study for 2021 showed. Not only is this the most important issue but it is also an area where we are nowhere near delivering what is expected of us. So that begs the question, “How can FP&A become a strategic partner to the business?”. Luckily, there is a way and in this week’s article, we will dig further into this topic. 

To start with we must define the mission for FP&A. That is, 

“to drive the right strategic choices in the company”

I defined this mission two years ago together with Bryan Lapidus from the Association for Financial Professionals and clearly, we still have quite some way to go. Through the pandemic, FP&A has been tested to the limit and fallen short. No matter how frequently we forecasted or how many scenarios we planned for decision-makers still did not feel that we helped them to the extent they needed. That to me is what the Key Issues study has cemented. To deal with the shortfall we need a transformation plan! 

I published an eBook together with Jedox last year to provide such a plan for the CFO. To realize the mission, we need a mindset change and transform our approach to people, processes, and technology. More on that to come in future articles where I will address the remaining key priorities for the CFO. This is all about business partnering and there is a straightforward path to becoming a successful one! 

Time to start the change journey 

To become a strategic business partner FP&A must embark on a multi-year change journey. There are three steps and five levers to work with. We have summarized it in below building blocks.

First, a foundation must be built which we then make concrete for people in FP&A to understand what to do differently. Lastly, we make it live in the organization through training in the new ways of working and embedding it into everything we do. Below we expand on each of the three steps.

It is not complicated making FP&A a strategic business partner. It just takes a lot of hard work over a longer period. There are no quick fixes or shortcuts. One building block at a time will make FP&A a strategic business partner. 

It starts with taking the first microstep 

The first thing you should do is to evaluate your current situation. How are you doing in terms of being a strategic business partner? Have you asked your stakeholders what they think? Can you document how you are currently driving the right strategic choices in the company? If not, this is a sign that you should start by taking the first step on the building blocks. Perhaps though you are already well underway and only need to close a few key gaps. 

There are many enabling factors that also play a role in FP&A becoming a strategic business partner. Do you have the right tools? Is your technology platform updated? Are you using the latest technologies? Is Accounting working well and producing high-quality data? At the end of the day, succeeding as a strategic business partner is very much the sum of all the enabling factors and taking the right steps in a business partnering initiative. 

In this article, I have outlined the key steps to take to address the most important issue for CFOs in 2021. Thankfully, we see many companies have realized this and coming to ask for advice on how to successfully transform their FP&A team into a strategic business partner. We believe this journey will continue in the years to come so it is not too late to get started, shall we?

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You can read previous articles in my CFO series below.

The Top 10 Priorities For CFOs In 2021

Agility And Sustainability And The 8 Types Of CFOs

CEO AND CFO - The Most Dynamic Duo In Business

The CFO Is The Voice Of Reason In Business

If you want to become a better business partner you should consider taking our online course "Business Partnering Explained - Value Creation Unlocked" to get a better handle on the role. It's accredited for 5.5 CPD hours.

You can read a lot more articles about FP&A, Business Partnering, and Finance Transformation below. It all start's with “Introducing The Finance Transformation Nine Box” where you set the ambition for your transformation. You should join the Finance Business Partner Forum which is part of the Business Partnering Institute's online community where we will continue to discuss this topic and you can click here to follow me on Twitter.

All Successful Business Partners Are "Leaders" (the last article in the series about our new capability model)

Should We Keep Talking About Business Partnering? (part of a 17-article series where we deep-dive on the WHY, WHAT, and HOW of business partnering by putting it on a formula)

Your Journey To Successful Business Partnering Explained

How To Create Value Through Business Partnering

Everyone Can Adopt A Business Partnering Mindset (part of a six-article series about FP&A Business Partnering)

From Business Partner To Working Within The Business (part of an article series where I interview finance professionals about their careers in FP&A and Business Partnering)

Is Your Product Optimized For Value Creation? (part of a toolbox series where we look at what tools FP&A professionals should leverage to drive value creation)

How Business Partners Turn Analysis To Insight (part of case study series where I interview business partners about how they drive value creation using real cases)

The Future Of FP&A: Two Ways To Take The Reins

What Is The Accounting Profession Paradox?

What Defines A Finance Master?

The New Career Path For Finance Professionals

How Finance People Can Be More Successful

The CFOs Roadmap To Transforming Finance

How To Become A Finance Business Partner

Financial Analyst vs. Finance Business Partner

Finance Business Partner Is A Bullshit Job

How Business Partners Keep A Plan On Track

Anders Liu-Lindberg is the co-founder, COO (Chief Operating Officer), and CMO (Chief Marketing Officer) at the Business Partnering Institute and owner of the largest group dedicated to Finance Business Partnering on LinkedIn with more than 9,000 members. I have ten years of experience as a business partner at the global transport and logistics company Maersk. I am the co-author of the book “Create Value as a Finance Business Partner” and a long-time Finance Blogger on LinkedIn with 55.000+ followers.