Increasing the value added role of the Finance function
Lundbeck who is a world leader specializing in brain disease and neuroscience research, have been making significant changes to the way their finance function and teams operate in the last few years. Like many global businesses Lundbeck has been looking to increase the value added role of its finance function. As a high performance business it is constantly looking at ways in which it can improve its effectiveness and performance. But the change is also set against the increasing realisation that the acceleration of digitisation in the business world is now making numbers a commodity. Therefore high performance finance functions need to fundamentally re-examine their roles and reshape their service offerings to reflect the wider changes taking place.
In 2011 Lundbeck launched their Strategic Initiatives for Group Finance with a mission of achieving excellence in providing trustworthy information, relevant financial services and influencing decisions to increase shareholder value. In the process the business would review many of its complex finance processes and governance structures. The comprehensive plan included major investments in new systems and the setting up of a new international shared service centre to automate and manage many of the routine finance tasks. The aim like many other businesses was to increasingly move to more global processes and standards of operation.
Realigning to being business partners
Another key foundation of this mission was to realign the role the Finance Function to one of a business partner. The aim was to release finance professionals from dealing with many of the daily activities and to focus them on playing a stronger supporting role in key business decision making. Another key challenge was to ensure that the team’s finance professionals further developed and extended their competence in facilitating and supporting important business decisions. Conventional financial controllers needed to become real partners to their various management teams in the many subsidiaries and corporate functions. This required many members of the team to develop different internal relationships with more emphasis on providing advisory and consulting services as opposed to simply controlling the numbers. It also required a new mental model in how finance staff thought about the business and how they approached and worked with their internal customers.
Traditionally high quality finance professionals have already been trained in good business skills such as analysis and problem solving. They are typically structured and disciplined in their work and possess a strong logical and analytical approach. Many will possess strong levels of business acumen and some will combine it with an ability to think strategically. Yet it is often in the high impact areas of influence and key relationship management that development is required. This is the essence of being a good business partner: how does one move from being a good technical finance person to become a trusted business partner? Using fact based information and financial insights to skillfully influence business decisions is the ultimate goal of today’s business partner.
The controllers in some of Lundbeck’s subsidiaries were probably closer to being business partners than their colleagues in central functions. They are invited into the many management team meetings and their wide day to day activities ensure that the relationship forged is often of a close and advisory nature. In contrast the specialist controllers working at some central functions did not always have the same opportunities as those operating in the subsiduaries and in the early stages of the transition they would be most impacted by the planned changes. Some would see their tasks being standardised and automated and so would need to look at different ways to add value as the new organisation and processes became embedded. There was a need for such staff to reflect on their roles and see the essential differences between a traditional “checking and controlling” role and that of a “business partner / advisory” role. A key challenge for any financial controller is getting the right balance between highlighting a financial issue that cannot be ignored and which might generate internal conflict, and adopting a more consultative approach that engages the business team as a trusted partner. It is a role that one colleague described as the “good cop and bad cop approach” But ultimately what the finance team were looking to develop was a group of controllers who possessed the same understanding, language, and approach to business partnering. Of course in a global business there are many other complex and specialist roles to be carried out in the finance function ranging from internal audit to treasury and tax to name just a few and these would also be included in developing an understanding and awareness of the business partnering process .
Developing business partnering capability
As part of this change process PPI was invited to work with Lundbeck to help develop an internal business partnering capability amongst the key finance personnel. Since 2011 PPI have run a series of intensive skills development programmes for the corporate finance team members with the objective of developing a common methodology and operating style towards business partnering.
Over a period of some two years Mark Thomas and Nick Kelly from the PPI Network took a group of some 60 finance professionals from Lundbeck through our Business Partner Skills for High Performing Finance Professionals programme. The highly experiential skill based programme uses a specific methodology to business partnering and enabled the team to develop a common vocabulary around the skills and techniques of business partnering.
In particular it helped them in:
• Their role as advisers and facilitators of business decisions – moving outside of the finance comfort zone
• Managing critical internal relationships and expectations - negotiating on key deliverables
• Structured problem analysis and solving - using various business models and frameworks
• Managing meetings and business presentations – how to achieve high impact and influence
• Project managing important change management and business initiatives
• Developing their political attenae and astuteness when influencing senior managers / leaders / stakeholders
The highly interactive successful program kept the participants both stimulated and engaged whilst adding to their business partner knowledge and skill set in very practical ways. The three day sessions were accompanied by periodic review days where colleagues were asked to share experiences of applying the skills and additional inputs were provided by PPI. In addition Lundbeck instigated a series of internal initiatives to maintain the momentum; these included the setting up of BP champion or Ambassador roles whose aim was to ensure best practice examples were shared across the team and wider function. In addition a knowledge sharing web site was set up to help again facilitate learning and best practice. The aim was to equip the team with a common understanding and approach to business partnering – in effect everyone would speak the same language. Indeed a key element of the PPI approach is helping finance professionals to reflect on their own Brand as a function and to show how they all individually either help to build or erode their Brand equity through their day to day interactions with the business.
Expanding the capability
Following the development process at the centre the next key challenge was engaging the wider global finance professionals from the many Lundbeck subsiduaries in the business partnering process. The requirement was to again share the thinking and skills of business partnering to the wider finance community and to develop a common understanding and language around the theme. Consequently in Berlin in June 2014 some 100 finance professionals gathered from around the world to participant in the Lundbeck Global Finance Conference. The strategic theme of the conference was business partnering and the future role of the CFO.
Through careful and detailed design with the Lundbeck team Mark Thomas and Nick Kelly from PPI facilitated a highly interactive and successful first day of the Conference. Utilising the experiences and skills of many of the central team and through the use of a very dynamic and varied agenda Mark and Nick were able to orchestrate a high level of participation and engagement around the key business partner themes and skills. The effect was to bring on board the wider finance team as to the meaning and operating style of business partnering. Additional inputs were also devoted to the other major finance systems and organisational initiatives being undertaken within the finance and business organisation.
This process has positioned the Finance Function to further drive the implementation of the Strategic Initiatives and make a significant step forward in realising their aim of transforming the role of the Finance Function.
If you would like to know more contact Gerry Buckley - email@example.com or +32 479 281601