Forming a synergistic team: Tomorrow's financial planning and analysis teams(FP&A)

  Forming a synergistic team: Tomorrow's financial planning and analysis teams(FP&A)

Forming a synergistic team: Tomorrow's financial planning and analysis teams(FP&A)

The role of an FP&A professional job is to tell the story of performance to inform better and drive choices. We need to create an information highway throughout the organization to communicate insights efficiently.

In June 2020, at Digital FP&A Circle, Michael Page director Jonathan Firth joined six other key speakers and facilitators to discuss critical topics on the future of FP&A teams. It covers key points about team roles, how technology can enhance FP&A teams, build synergistic teams, adapt to the ‘new normal, and how to motivate remote and multicultural teams.

We'll look in this article at what it takes to create a synergistic team and how to keep diverse teams engaged and motivated when working remotely.

In FP&A, how can you create synergistic teams?

Maria Olsson, FP&A Transformation Lead at ConvaTec, addressed what a synergistic team requires during the Digital FP&A Circle. Although it is essential to make it easy to identify a wide range of skills needed, a synergetic team cannot be formed until these individuals work well together.

 A synergetic team is one in which everyone works together to maximize the abilities of each other. Synergistic teams are formed by determining where people fit best within the group. People who have a purpose and can be creative have always been the most productive.

It's also worth noting that there are various barriers to team synergy. According to a poll conducted by the Digital FP&A Circle, most participants believe that the main barrier is a lack of goal alignment. Goals must be conveyed effectively throughout the organization. Having different mindsets is tantamount to having different goals.

Remotely motivating diverse teams

Will Ingles, Avon's FP&A Director, expressed his opinions on team motivation, emphasizing the importance of motivation. You'll need to interact and engage even more than before.

Will suggests following a few key guidelines to keep spirits high:

1. Be aware of cross-cultural sensitivity issues. Culture differs significantly around the globe, which may be seen in management practices and what is considered acceptable. In some countries, for example, napping at a desk is acceptable, whereas others appear to be always relaxed, even during times of crisis.

2. Recognize the tools and infrastructure that our teams require. With the current crisis making travel impossible, technology has become a fundamental pillar of the workday. For example, does your team have a laptop and a reliable internet connection?  Can large files be sent by email?  Have they ever worked from home? Working from home and social distancing will be the "new normal." Our employees must be able to present over the internet in this environment.

3. Be a human being. It is an essential aspect of management. Maintain a personal touch by demonstrating empathy, offering advice, being aware of personal issues, and not overload meetings. On Fridays, for example, at Will's company, they have a virtual pub lunch where they don't chat about work and instead get to know each other.

4. Be ready to alter your team's communication style.  Do you use Zoom or WhatsApp? We need to gather input on what works best for the team on a regular basis.

Developing a solid financial planning and analysis (FP&A) team is critical to the performance of the finance department and, indeed, the whole company.

In today's corporate environment, when technologies like artificial intelligence, machine learning, big data, and more specialized FP&A software dominate the conversation, FP&A teams must still lay a solid foundation before capitalizing on these new trends.

So, what are the fundamentals that an FP&A leader must understand and cultivate?

These are what I refer to as the "ABC of FP&A."

•       The letter "A" stands for "analytics."

•       The letter "B" stands for "business savvy", and

•       The letter "C" stands for "communication."

FP&A's Role in Different Types of Analytics

FP&A experts are required to evaluate and analyze P&L for business management in financial analytics. The immediate accounting procedure is typically the first step. FP&A experts remain involved as the accounting, or controllership function approaches month-end and completes the required closing processes to ensure that the business results are as anticipated. To comprehend specific revenue recognition perspectives, the accounting or controllership team may collaborate with FP&A experts. While the choice should be made solely on GAAP, FP&A may assist in interpreting customer contracts and ensuring that revenue is recognized in the appropriate context by the controllership team.

FP&A experts may also assist in other areas, such as cost management, by reviewing accounting results to verify that the company's cost-cutting initiatives positively affect the bottom line. This is particularly essential if the company has developed turnaround plans or cost-cutting efforts disclosed to outside parties. FP&A will have to convert this cost reduction from accounting records to different activities to ensure that all stakeholders know the work put in and the outcomes achieved.

General analytics on non-financial data is another analytical ability that the company would demand from the FP&A team. A growing number of businesses are using different key performance indicators to evaluate company outcomes (KPIs). Balanced scorecards and the awareness that organizational success cannot be exclusively dependent on financials have sparked a lot of debate.

Because they are well-trained in understanding and connecting various data sets, FP&A experts are uniquely positioned to offer all types of data analysis. When attempting to understand the efficiency of human resources, for example, the most frequent non-financial data that FP&A professional’s resort to is headcounts. FP&A experts can choose the best moment to hire or resize teams by looking at headcount and financial performance. They also investigate charge-out rate problems and advise the company on acceptable charges for people-related services.

Finally, FP&A must evaluate general business choices and offer value-add from the perspective of business partnerships. That implies that, in addition to financial and other data analytics, FP&A experts must assess risk and offer strategic decision analysis. This is an area where FP&A serves as a broad business adviser to the line manager rather than just a financial advisor. FP&A professionals must acquire excellent business acumen to be effective in this position, which we shall cover in the following section.

Ways to Improve Your Business Acumen Knowledge from both inside and outside

External and internal business acumen are both possible:

•       Understanding industry trends, rivals, and the industry's future is part of developing externally oriented business knowledge.

•       Internal business acumen entails a thorough knowledge of how various departments operate, the problems they confront, their KPIs, and how they affect the bottom line.

To identify external trends, FP&A experts may collaborate with strategy and marketing departments. For companies that include a strategic planning cycle in their overall planning cycle, FP&A often collaborates with strategy teams and assists them in developing financials to support the strategic planning cycle. They often offer insights into revenue and expense drivers throughout this process, allowing strategy teams to evaluate growth possibilities.

FP&A may also help with sanity tests and number verification as defined by the strategy or sales team. It may be accomplished by thoroughly examining growth patterns, market prospects, and growth methods such as organic vs inorganic growth.

Internally, FP&A may collect and identify cost or expenditure levers that can assist generate revenue by knowing how the company operates. For example, by knowing different marketing channels, FP&A may assist in determining marketing costs and evaluating the return on investment (ROI) of various marketing initiatives. FP&A may also look at several sales channels and assist decide how much to spend on each one.

FP&A can assist business managers in prioritizing and optimizing the ROI of various projects by identifying and evaluating these various business levers.

Communication: Emphasizing Activities That Add Value

Finally, let's say the FP&A department wants to be effective in delivering analysis and driving strategy debates. In such a scenario, communication will assist in bringing all of these value-adding activities to the table, allowing the company to concentrate on what is most important.

Communication may come in a variety of flavors:

•      Data visualization technologies provide quantitative data in an easy-to-understand manner for company executives. FP&A professionals must learn how to use data visualization tools or conventional spreadsheets, or presentation applications to communicate successfully with the company.

•      Ability to communicate well in professional and casual settings, such as presentations. As a result, FP&A professionals will need to hone fundamental communication skills, including assertive communication and effective writing, and understand how to construct and convey messages through emails and presentations. All of these are critical talents that the FP&A staff must possess.

Conclusion

In today's corporate environment, the FP&A function is rapidly changing. FP&A teams, on the other hand, must build a solid foundation in the "ABC" categories mentioned above to take advantage of emerging technology and proactively redefine their role. Without a strong foundation, it's easy to slip and tumble if you try to accomplish too much.