Following are the 8 key operating principles for Strategic Finance Professionals including Finance Business Partners / FP&A Business Partners/Strategic CFOs to implement :
1. Never say no without giving options- Never reject any proposal of your business partners without having some conversation with them, Understand the business result they are trying to achieve and work with them on developing options.
2. Think in terms of the business- Don’t give them accounting reasons behind expenses or revenue variation that you made accruals or deferred income etc.. Give the business reason behind everything. Look behind the numbers to articulate the story of what happened, where & why did it happened and then what’s going to happen next and how can we make it happen.
Focus on both the traditional side of the business and new growth / innovation side of the business.
3. Integrated Business Approach- Best way to develop this approach is to keep open communication within finance function as well as with other business functions so that everyone is aware of what other functions are thinking and their impact on others. Create culture of open communication and deliver integrated reports rather than traditional financial reports.
4. Early warning signals- Never give them surprises and always try to anticipate risks and opportunities in advance by communicating and discussing all symptoms of potential risk and opportunities upfront.
5. Alignment with business- While transforming finance function to play more business centric role, always align with the business leaders on the sources of value creation for the future, then work backward to redesign finance function around them
6. Build new & deeper specializations in finance – rotate resources within the finance function to different business units & functions and work on different cross-functional projects to get deep dive understanding of different aspects of business and what are the key sources of value creation in the business
7. Focus more on value creation- Don’t just focus on the tangible assets and short-term profit maximization, rather focus on intangible assets like customer relationships, corporate brand, culture, leadership, employees relationships etc. in order to ensure long term value creation for the business for all key stakeholders not just shareholders
8. Right Investment in technology- While making investment decisions in emerging tech, always first think of the potential problems and challenges in your organization & its business & then work with their vendors to customize such technology to solve them, don’t just take ready made technologies and re-design your business according to them.
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