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Is Finance Business Partnering Alive and Functioning in SMEs? The Jury is Out!

By Leonard Brown, FCMA, MSc in Business Improvement

Lots has been written about Finance Business Partnering – and an Accountants key role in helping ‘better’ decisions be made within the business they work in.  Small and medium-sized businesses might seem an obvious place to look for evidence of that: not only do they normally have relatively few decision makers – but their senior Finance professional frequently works in close proximity to all of them.  However, a couple of straw polls held during the Summer of 2021 raise questions as to how often the in-house Accountants in these businesses can or do exert much influence on decisions made.

The role title - Finance Business Partnering has become common-place

In recent years, lots has been written and spoken within professional Accounting circles on the topic of Finance Business Partnering - and the role title ‘Finance Business Partner’ has become common-place.  Debates continue in some quarters, as to whether Finance Business Partnering is truly something new – or just a new name for something that already existed.  But, whichever, as Artificial Intelligence ‘hoovers-up’ more and more of the tasks in the Finance department – its important Finance professionals have clarity on how and where they can add the most value to the business they’re working in.The concept of Finance Business Partnering attempts to provide that clarity.  The premise is - Accountants can add real value when they work closely alongside their business’s decision-makers – and use their analytical, interpretive, and influencing skills, to help them make ‘better’ decisions (decisions that deliver ‘better’ results than would otherwise have been achieved without their involvement).And what worthwhile decision-maker wouldn’t want to work with someone who could help them make ‘better’ decisions and deliver ‘better’ results?

But is Finance Business Partnering happening – on the ground?

Of course, the key question is – not what ‘might’ ideally happen- but what ‘is’ actually happening, on-the-ground.  And that question has two-sides to it:
1 – Are Accountants given the opportunity? And if so...
2 – Do they/can they take it?  

The causal feedback I’ve picked-up over time - from workshops and from clients -suggests it is likely not happening as regularly as it might.  

In summer 2021, I decided to check it out

And so in summer, 2021, I decided to check-it-out.  I decided to dig a bit deeper and try to get a better understanding of what is actually happening in these businesses. 
I wanted to find-out... 

(1) To what extent Accountants working in SMEs are involved in the decision-making processes: to what extent they are helping ‘better decisions’ be made– and, 

(2) If they’re not involved, why they’re not.It was always going to be a small-scale, ‘finger-in-the-air’, type project.  My plan was to gather information during short, one-on-one, telephone or video-call interviews with Accountants working in SMEs – and I reached-out accordingly.  

Kindly, a number volunteered, and were interviewed - but not in sufficient numbers to allow any meaningful view of the situation.  And so I needed to pivot – and did.

I used two ‘Straw Polls’ on LinkedIn to gain feedback 

I used two ‘Straw Polls’ on LinkedIn to gain feedback:  - The first poll was to establish the major factors which those Accountants who responded saw as preventing them from playing the ‘Finance Business Partner’ role in the business they currently work in.  

- The second poll was to dig deeper into the single largest inhibiting factor highlighted by the first poll.
Both polls were posted in the “Chartered Institute of Management Accountants (CIMA)” LinkedIn group: 

Poll 1 asked what was the major factor holding participants back from becoming a Finance Business Partner in the business they currently work in?”Of the 261 who participated...

- 38% cited ‘LACK OF DEMAND’ as the major inhibitor: Their management colleagues were neither expecting nor encouraging them to provide ‘real time’ support and analysis for the decisions they have to make.

- 32% cited ‘LACK OF TIME’ as the constraint.  Presumably the Accountants who chose this option were already fully occupied and felt themselves ‘too busy’ to get further involved in supporting the decision-making processes.

- 19% candidly acknowledged - they ‘DON’T KNOW HOW’ to go about it or know WHERE best TO START.  (I’m guessing, they recognise if their career is to progress in this direction, they need to learn both)

- 11% chose the ‘SOME OTHER REASON’ option.

Poll 2 sought to ‘tease-out’ WHY participants believe there is a ‘LACK OF DEMAND’ from the decision-makers WHY their managers don’t look to them for help in reaching decisions.  (NB: Lack of demand was the single largest factor cited by those who participated in Poll 1)  
Again I provided four possible explanations.  This time 135 individuals participated. (Ample to explain the selection in Poll 1)

Of those who took part in this second poll...

- 41% of respondents
believed the reason they aren’t asked to be involved when decisions are being made is because their management colleagues feel they DON’T UNDERSTAND THE BUSINESS sufficiently well to contribute meaningfully. 

“They don’t understand the business” is a reason cited in lots of surveys that seek to understand ‘Finances’ involvement in businesses.

Sadly, often, it’s true.

For Accountants who work in large corporates, that lack of understanding might result from lack of opportunity: the Finance Team might be physically remote from the commercial and operations locations – or it might be ‘cultural’.

Whichever - unless they actively look to gain that experience – perhaps through secondment or by taking-on a role outside of Finance for a period of time - they will likely struggle to gain both the understanding and empathy needed for successful Finance Business Partnering.

But ‘remoteness’ is not the problem for Accountants working in SMEs (or at least it doesn’t need to be true).  

By definition, SMEs are smaller!  An Accountant who works in one - and who wants to ‘understand’ the business - normally has every opportunity to do it.

It simply involves them getting away from their desk: seeing what’s happening in other parts of the business: talking to their non-Finance colleagues: recognising when they have problems: understanding what those problems are, where they are, and why they are - and figuring-out what they (as Finance professionals) can do to help.

- 24% of those who voted felt the reason their managers don’t look to them for help is because ‘they don’t expect to get it”.

Looked at from one viewpoint, it would be quite sad if the decision-maker were to feel their Finance colleague would be able to help – but has no interest in doing so. But looked at from another angle, perhaps those managers can’t envisage what help an Accountant might provide – and that’s why they don’t look for it? 

But if that is the problem – it’s so easily remedied: the remedy is not for the Accountant to tell her/his management colleague how she/he might be able to help – but, instead, do it/show them. 

And so – on reflection, what did I learn from this exercise?

On reflection – what have I personally learned from this short exercise? 

I’m not sure ‘learned’ is the correct word: perhaps ‘confirmed’ would be a better one.  But, whichever – these are my ‘takeaways’:

For an ambitious Management Accountant who wants to demonstrate the value they can add to their business, key points would be:
1 –Choose the businesses to work in, very carefully. Their senior management might not have experience of their in-house Finance professional being involved in decision-making - outside of the strict ‘financial’ areas – but they need to be open to it – and better still whole-heartedly welcome and encourage it.

2 – Don’t allow yourself to become ‘too-busy’ to get involved in the key issues and decisions the business faces.  Do what it takes to make yourself available to ‘add value’ – and learn from what others are doing.

3 – Understand the business and show you understand it.  Get away from your desk. See, and be seen. Take opportunities to get involved in issues outside of Finance. Learn in whatever way you can.

4 – Don’t get too hung-up on job titles.  In terms of ‘adding value’ – it’s what you do – not what your job title is, that counts.

About Leonard Brown: 

Leonard Brown, FCMA, MSc (Business Improvement), is founder of coaching, consulting and on-line training provider, Profit Analytics Ltd, based in Belfast.  With over 30 years’ experience stretching across privately owned businesses and corporates, Leonard has operated in the roles of Group Accountant, Finance Director, what today would be called Finance Business Partner, Regional Operations Manager, and General Manager. Do the ‘votes’ registered in these two LinkedIn polls marry-up with your experiences on this topic?  I’d like to know.  If you’d be willing to tell me – you’ll find me on LinkedIn @ linkedin.com/in/leonardbrown