What is a Finance Business Partner?

What is a finance business partner? 

A Finance Business Partner (FBP) is a finance professional who serves as a liaison to various budget owners in an organization. They provide financial reporting, insights, analysis, and decision-support. The primary objective of an FBP is to facilitate business performance. The FBP function typically focuses on:

• Planning and analysis: Strategic planning, analysis that develops insights that support decision-making by stakeholders
• Budgeting and forecasting: Managing budgets, financial forecasting, and monitoring performance
• Analyzing key performance indicators (KPIs): Identifying cost reductions and efficiencies, and opportunities for growth
• Financial reporting and compliance: Accurate financial reporting, policy and compliance regulation, and preparation of financial statements
• Business case development: For new projects or investments, financial viability evaluations, cost-benefit analysis

Related resources: How does analysis support the FP&A process?

What skills should a finance business partner have?

Business partnership is essential to the function of FP&A , yet 45% of FP&A leaders struggle to make time for this high value work. Finance Business Partners (FBP) require experience in technical and finance skills; however it’s even more critical that they understand operations so they can clearly connect operational data and metrics to financial outcomes.

Additional skills include analytical abilities and strategic thinking. As an example, a good finance business partner partnering with the marketing function needs to not only understand the overall spend of demand generation initiatives but also important KPIs such as cost-per-lead (CPL), customer acquisition cost (CAC) and other marketing metrics that shed light on whether marketing investments are being spent effectively and foretell the financial impact of spending more or less on demand generation activities.

Effective communication is a very important skill as FP&A leaders have insight into the organization as a whole, across many functions and they need to feel empowered to elevate their highest-level insights and concerns to executive leadership, while framing them as opportunities for improvement rather than just problems.

Building strong relationships, solving financial challenges, and managing projects are also essential. This role involves translating complex financial data into actionable insights and aligning financial strategies with key business priorities. Having these types of skills enables finance business partners to become strategic partners to the business shaping its future success.  

How does technology affect finance business partners?

Technology and tools enhance the role of finance business partners by improving data accuracy and availability, enabling advanced analytics, and streamlining financial processes. It facilitates better collaboration and communication, hastens processes, and improves the use of real-time data. 

Technology-driven efficiencies lead to cost savings and better resource optimization, all while promoting continuous learning, adaptation, and innovation. Inturn, this increases the value finance business partners bring to their organizations.

There are many benefits to leveraging technology in finance and business partnerships, including:

• Support with reconciliation: Reconcile new hires and terminated employees, add a planned position, or backfill positions all in a few minutes.
• Workflows: Simple workflow engages the business in workforce planning tasks and provides self-service access to workforce analytics and reporting.
• Assumption-based planning: Plan detailed assumptions for comp, benefit expense, employment tax, and more in an easy, plain-language interface with no complex formulas. 
• Integrated planning: Headcount-based workforce-related expenses automatically update in the Operating Expense plan (e.g. higher recruiting costs or fewer software licenses).
• Scenario building: Supports an agile FP&A team to build scenarios quickly and see the implications of headcount for the organization’s ability to meet annual plan targets. 

Related resources: Top FP&A software solutions by company size

What challenges do finance business partners face?

There are many challenges in finance business partnerships that make it difficult on a daily basis. These include:

• Collaboration challenges - There are various challenges when it comes to collaboration, like building trust, resource constraints, and technical proficiencies. In the webinar:  Business Partnership: A Path to Success for FP&A, Christian Wattig, an FP&A expert,  discusses utilizing the emotional bank account framework (EBA). 

EBA is the concept of maintaining positive and productive relationships. Building trust is one of the most crucial components of making deposits and maintaining meaningful relationships. 

“When you have a strong foundation of trust, you can make withdrawals without damaging the relationship. In other words, the relationship can weather minor conflicts or disagreements when there is a positive balance in the Emotional Bank Account. “ 

Questions to ask yourself and others when utilizing the emotional bank account framework (EBA): 

Questions to ask yourself:

- Have I been making enough positive "deposits" into this relationship?
- Am I actively listening to the other person's concerns and feedback?
- Do I follow through on my commitments and promises?
- Do I take the time to understand the other person's perspective?

Questions to ask others:

- How do you feel about our current level of trust and communication?
- Do you feel supported and appreciated in our interactions?
- How do you prefer to communicate and receive feedback?
- How do you feel we handle conflicts and disagreements?
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With this in mind, ask the question: how are you building trust in your organization? 

How are you building and maintaining close relationships with key stakeholders? 

• Slow processes - Automating tasks to reduce slow processes is an approach that leverages technology to enhance efficiency and productivity. By implementing automation, organizations can eliminate repetitive and time-consuming manual tasks, allowing employees to focus on more strategic and value-added activities. 

FP&A tools that offer automation, can streamline workflows, reduce human error, and ensure consistent output. This not only accelerates process execution but also improves accuracy and reliability. Additionally, automation can facilitate real-time data processing and decision-making, enabling quicker responses to changing business needs and market conditions.

• Lack of Skill - Lack of skill is an obstacle that can be a challenge to solve for any organization. In FP&A, identifying insufficient skill sets requires two things to overcome; business acumen and empathy.

Business acumen: a combination of knowledge and skill informed by experience

Empathy: The ability to understand and share the feelings of another.

The foundations for business partners utilizing empathy and business acumen provides FBPs with the ability to put themselves in the shoes of others. Lack of business acumen (if not visible) poses a big obstacle as organizations will not be able to connect with business financials and align with deliverables. 

Through effective business acumen, organizations can understand  the strategies of various departments (sales, marketing, operations, etc) and how these strategies lead to tactics, action plans, and finally, metrics.

Tips to improve business partnership

To further improve in overall team skill and visibility, FBPs can also  focus on four things:

• Democratize data: Data that different departments utilize need to be shared across departments (including finance).
• Link financials with operations: Identify trends from profit and loss and compare these to the strategies being executed by individual departments.
• Follow the variance: Doing variance analysis is vital to FP&A. Challenge the organization to identify the root cost. And finally;
• Mingle: Increase the amount of touchpoints you have with individuals within the organization.

Related resources: Six focus areas for strategic FP&A teams

Effective FBPs leverage tools to support the day-to-day

Leveraging FP&A tools is a critical function within an organization that encompasses a wide range of activities, from budgeting and forecasting to analysis and collaboration. 

By understanding the FP&A process, using modern systems and tools, and fostering strong business partnerships, finance teams can support strategic decision-making and drive organizational success. Finance business partners that continue to evolve their experience, embracing innovation and adopting best practices will stay ahead in the dynamic world of strategic finance.