Many Finance professionals strive to become better business partners supporting the business through insights and decision support.
But how do you measure whether you are succeeding as a finance business partner?
This article presents three ways to measure your impact as a finance business partner.
Creating impact as a business partner
At its core, the sole focus of finance business partnering must be to create real business impact – helping the business to be in a better place than it would have been without the involvement of finance.
However, impact is an unclear concept in today’s corporate world. It's a term used frequently, often as meaning “having a strong effect on someone or something in the business” (Cambridge Dictionary, 2022), but without any clarification on how it is measured.
As a Finance professional, three ways to measure your impact as a finance business partner include:
- Business results: Your ability to help the business reach its objectives and financial results.
- Value interventions: The effect of your value-adding interactions with the business.
- Customer satisfaction: The value of your services as perceived by the business stakeholders, i.e., your internal customers.
Each of the three ways to measure your impact is unfolded below.
Finance professionals striving to be true business partners should be measured according to the same metrics as the business being supported. That is, as a business partner, you're a success if your internal business stakeholders are succeeding.
...as a business partner, you're a success if your internal business stakeholders are succeeding.
In the most ambitious form, a finance professional who's committed to act as a true finance business partner must create a value-add equal to or larger than the cost associated with his/her employment. That is, if you’re not improving the net profit by an amount greater than the sum of your salary plus overhead, the company has no reason to keep you on the payroll.
However, as a Finance professional, you are rarely able to influence revenue directly, nor are you able to reduce costs significantly without the involvement of others. Thus, to succeed as a finance business partner, you must assert influence to create an indirect impact on the business results through others.
Measuring your impact on the overarching results of the business is an impossible task for most - who knows exactly what their effect is on the bottom line? However, measuring the impact of your interventions on the business is more tangible.
That is, when you – as a Finance professional – deliver services to an internal business stakeholder, the value created by these efforts can often be documented in terms of various performance measures such as productivity improvements, risk reductions, lead times, or even monetary effect.
Finance business partners should see their engagements with the business as value interventions and keep track of their results.
Consequently, your impact as a finance business partner comes down to your ability to create 'value interventions' - value-adding interactions with your business stakeholders. By monitoring the progress and results of your value interventions, you will be able to showcase your ability to create business impact.
As concluded earlier, finance business partnering entails creating an impact through others. That is, finance business partnering is about exuding influence on others, thereby making them act in different ways than they would have done otherwise.
To achieve influence through others, you must see your internal stakeholders as a customer base.
Only by keeping the customers satisfied, will you be able to succeed with impact creation.
Consequently, to measure your impact as a finance business partner, you should keep track of customer satisfaction through frequent dialogues, performance reviews, or even a qualitative measure like a Finance NPS (Net promotor score). If your internal customers are satisfied, you are doing something right.
Want to keep the conversation around finance business partnership going? If so, consider joining the Finance Alliance Slack community, where you can network with other finance professionals, share ideas, access resources, and more.