Finance in transformation
Over the past ten years, the finance function has been under increasing pressure from several directions. Shifting shareholder and market expectations, new regulations, rapidly changing technology, and increased competition have all taken their toll. This has led many companies to launch cost-cutting initiatives, reduce duplication of work, and extend the influence of the finance functin across the organisation.
When it comes to transforming the finance function, there is no single approach. However, certain trends are clear. Typically, routine financial activities are now undertaken by a shared service centre or outsourcing provider. Centralised centres of excellence are charged with running specialist activities, such as treasury. And the rest of the finance department, while still overseeing compliance and control, is increasingly expected to take on a value-added, ‘business partnering’ role, to help other parts of the business improve their analysis and decision-making.
According to Gary Rourke, a Finance Vice President at AstraZeneca, “There is a vital role for finance business partners to help optimise performance. Making the right business decisions ensure we‘re allocating resources in the right way, and making the right calls in terms of strategy and the overall direction of the business.”
Finance business partnering has become mission critical for many businesses. In the survey, 62% of Dutch respondents say that their companies are looking to form a deeper, value-adding relationship between the finance function and other parts of the business, compared with 74% of respondents overall. Yet, almost four out of ten (38%) say that they are not seeking to develop this relationship, which is the highest proportion of all countries surveyed. This implies that, even though the overall majority recognises the importance of business partnering, the Netherlands is not one of the forerunners in this context.
However when looking at the prospects within three years, there is a significant increase in the levels of business partnering expected. Currently, 19% of Dutch executives state that more than 10% of their finance function currently serves a business partnering role. But in three years’ time, this number is expected to double to 38%, which suggests that the trend for business partnering will become more embedded in Dutch business life. Respondents identify the CEO (40%), CFO (28%) and board of directors (11%) as the most influential stakeholders who will be instrumental in developing a deeper business partnering ‘relationship’, emphasising that the responsibility for business partnering lies at the executive level.