“In most businesses, finance struggles to find the right model to deliver real commercial impact effectively.”
This quote was extracted from PwC’s report “Stepping up: How finance functions are transforming to drive business results.” While finance has the potential to drive both business insights and internal business growth, more often than not the finance function does not maximize what it has to offer the organization.
It doesn’t have to be this way.
According to PwC, “over the past several years, finance functions have pursued efficiency improvements through the traditional means of process simplification, standardisation, shared services, and outsourcing.” This optimization of processes gives finance workers the opportunity to maximize their contributions.
Finance benchmark data has found 3 outstanding criteria that set top finance performers apart from the rest. Finance departments that promote these behaviors, and workers that adopt them, are more likely to see success.
“I think the more informed finance departments out there have recognised that they don’t just need to produce the financial information more efficiently,” says PwC UK’s Mark O’Sullivan. “They have to show they can actually analyse, interpret and predict rather than just produce. They’re also starting to realise that they already have a lot of the thinking, systems, processes, and controls in place for the more important strategic information relating to their key resources and relationships, such as their customers, their employees, and their supply chain.”
What can we learn from top performers?
PwC’s Finance benchmark data identified the following three behaviors as criteria that set top performers apart from the rest:
1. They spend more time on analysis versus data gathering
2. They run at lower costs
3. They’re paid more
Spend more time on analysis
According to PwC, even in top quartile companies, analysts spend 40% of their time gathering data, not analyzing.
Top performers, on the other hand, spend 20% more time on analysis versus data gathering.
Every analyst should aspire to maximize time spent on analysis, something that is much more achievable today thanks to emerging technologies.
For example with DataRails, finance professionals gain time that was previously spent on valueless data consolidation. Top performers devote this gained time to inquiring into the numbers by working with a financial BI tool designed specifically for finance professionals.
Tableau is another tool that is great for analysis. Tableau helps in simplifying raw data into very easily understandable formats. The solution is a powerful, secure, and flexible end-to-end data analytics platform.
Thanks to such tools management receives not just the essential figures, but more importantly trends recognized and conclusions drawn from the numbers.
Run at lower costs
According to PwC, leading finance functions cost 36% less than the median finance functions.
Across many key finance processes, automation and process improvement can reduce costs by 35-46%.
Top performers operate at lower cost not by reducing service levels but by standardising and simplifying their core processes and systems – enabling them to free up resources to focus on business partnering.
Make more money
PwC’s report claims that less than a quarter of finance time is spent delivering business insight.
For this reason, top quartile companies pay their ‘insight’ finance professionals 25% more.
Modern technologies give companies the opportunity to assess their finance function’s ability to contribute to value.
Top performers walk the walk
If you see these attributes in an employee, chances are you’re looking at a top performer:
• They’re clear on their value proposition • They want to keep improving and challenging the way they operate, the value they add, and how they interface with the business • They have an unrelenting focus on efficiency – challenging what to stop doing, as well as what to standardise and automate • They embrace change, particularly in new ways of working and more visual and technology enabled management styles using collaboration tools to reduce cycle times and new behavioural techniques to get the best of their staff • They are starting to embrace new cloud-based and robotic technologies, often instead of the traditional outsourcing route
To achieve real competitive advantage, finance needs new and innovative thinking together with a willingness to explore new technologies and ways of working.
If you are interested in reading the report discussed, you can access it here.