Stuart Bilbrough explains why finance teams need to be transformed from processing transactions, to adding value, and how to do it

By Stuart Bilbrough*

I was at a New Zealand Institute of Directors mentoring lunch a few months ago and a tenured director said that he didn’t like receiving very large Board packs with a lot of data but no information or insights.

My first thought was that the Finance function wasn’t doing its job correctly. It shouldn’t be a Board members responsibility to interpret how the business is performing, that’s what Finance does.

Providing an executive summary with authoritative commentary and then more detail where needed should be a minimum expectation.

When receiving output from Finance, what I like to refer to as the ‘product’ – monthly business unit P&L’s, rolling forecasts, product development profitability, etc. – and the receiver needs to be strong financially to interpret what they’ve received indicates a problem to me.

Finance teams have greater expectations on them than ever before to provide insightful and value adding support.

Finance providing ‘just the numbers’ is long gone and this includes even the most modest sized teams supporting a New Zealand SME, governmentally funded department and not for profit organisation.

More than ever that value provided by Finance forms an important part of the overall success of an organisation and its growth objectives.

The challenge I have had with the Finance teams I’ve lead is balancing the day to day transactional process and ever increasing compliance with the expectation to partner a business and add value.

The reality is these processes and compliance are critical to the business but are relatively invisible to the key decision makers of the organisation whether CEO/MD, Board and/or senior managers and heads of department. “What do those guys in Accounts actually do other cost the company?”

CFO’s that head these teams have known for decades that they need to be more strategic and add more value.

Large corporates have carried out expensive multiple year finance transformation projects. For smaller organisations time and resource is not as readily available. I would hazard a guess that those reading this article will find that their CFO is supporting their business well. The problem that the CFO has is that when the team that supports us does not have a value adding skill set.

The support and value my team provides me and Radius Care has significantly improved since a series of training sessions over a six month period.

These training sessions were internally developed as there didn’t seem to be what I was after provided externally. I also wanted the whole team to do the training and the cost, had courses been available, prohibitive in our resource sensitive organisation.

Additionally, as I took the training, I was able to discuss my expectations for the team in an informal environment. We were also able to use Radius specific issues in the exercises meaning some improvements were realised straight away.

The training sessions are now included in the book Bean Soup – Beyond Bean Counting.

The book’s objective is to provide an easy to read succession of steps that first assist in identifying the skills gap in value provided by a Finance team and then closing that gap. Admittedly ‘easy to read’ may seem contradiction in terms when it is an accounting business book but feedback so far is that it’s just that.

The real value to any one reading the book and then transferring the learning points to their own organisation is that the training sessions can be customised to their business and Finance team relatively easily. 

As such the book is a complete toolkit that supports a head of Finance/CFO and provides valuable yet logical steps for lifting a Finance function skill set towards adding value. Being a practicing CFO I have experienced the issues raised by senior manager, Boards and CEO/MD’s needing greater support.

Bean Soup is what I did about it.

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Stuart Bilbrough is the author of the book, Bean Soup – Beyond Bean Counting. You can read a review of the book here. You can buy it here.