Creating the Finance strategy that drives performance

Finance strategy is now more important than ever.  Global competition, cost pressures, sourcing alternatives, global compliance, reporting convergence, acquisition analysis and integration – today’s Finance organization must continue to find new ways to partner with their business to deliver the value-added services required to remain competitive. 

Unfortunately, in today’s complex operating environment it can be a challenge to create and execute the strategy required to accomplish these goals.  A comprehensive and mature Finance strategy should be:

• Actionable.  A strategy must be realistic and detail specific behaviors to bring the strategy to fruition.  Actionable plans at each level of the organization must cascade downwards so that personnel on the front lines understand corporate and financial objectives and how their activities support those objectives.
• Flexible.  In a world marked by globalization and quickly changing opportunities, businesses and their Finance organizations should be characterized by a flexibility that enables them to respond to those new opportunities in a pragmatic and disciplined manner.  This includes establishing the proper cost structure, balancing fixed and variable costs that maintain cost discipline yet enables the flexibility required.
• Scalable.  High performing Finance organizations have the systems, processes, organization and governance structures in place that enable them to scale as their business grows.  Acquisitions are effectively integrated into the organization and anticipated ROIs are achieved on schedule.  There is a defined approach that enables Finance to support expansion into new geographic markets.
• Supportable.  A strategy that cannot be supported by existing or planned resources is worse than ineffective; it will lead the Finance organization down the wrong path instead of generating the value-added delivery capabilities their company requires. 
• Measurable.  A well-crafted strategy has specific and measurable outcomes.  Finance strategy should have an integrated set of key performance indicators that assist in the evaluation of Finance’s effectiveness and efficiency in delivering the services that support corporate objectives.

Ultimately, an organization’s financial strategy must be aligned with the corporate strategy. It is no longer sufficient to be the scorekeeper who reports historical results.  Today’s Finance organization must be an equal partner in the formation of corporate strategy and provide the intelligence, analysis and insight necessary to support the corporate vision for growth and profitability.