How Collaborating with Finance Supports Good Decisions
In today’s relationship-oriented business environment, who you know and how you work with them are as important as anything you do. Collaboration is just as essential to finance as it is in naturally “creative” functions such as sales and marketing.
That being said, collaboration is not easy for finance, where accuracy and certainty are our stock and trade, but it isn’t really easy for anyone else, either. Any time there is a strong human or qualitative dynamic to the work being done, the level of complexity goes up very quickly. When your goal is to find the best answer rather than the right answer, judgement and perspective are tantamount.
Complexity notwithstanding, collaborative finance (if there is such a thing) is still finance. Changing the way finance interacts with other individuals and organizations is about expanding the scope and results of our efforts, not rejecting precision or embracing fuzzy math. How, then, can finance reconcile the subjective and objective demands of collaborative business?
My solution to this seeming conflict is to separate interactions from information in collaboration. Information – data, facts – are stable and certain, making them the exact opposite of the interactive dynamics brought to bear in collaboration. When a team initiates an effort by coming to quick agreement around the relevant facts, more energy and effort can be invested in interactions and creative outputs.
A key factor in reaching agreement is having data that has been shared with and vetted by the rest of the company. This increases everyone’s confidence in the decisions reached based on the available known data. From our perspective, it is also better to have the team’s decisions themselves supported by a trusted financial system. Making a process or a project collaborative does not mean throwing math and analysis out the window. Instead, being collaborative should impact value potential by increasing the number of variables, exploring the influence of constraints and opening the door to unexpected solutions.
Working collaboratively requires more technology, not less, as long as it is the right kind. Data must be kept as current as possible at all times. Tools must be easy enough to use that analytics and optimization are done in the system rather than by exporting data, breaking the lifeline between the source system and fact-based decisions. Running more “what-if” scenarios and discussing their relative merits is a great use of collaborative energy and input. Leave data quality and analytics to technology and allow teams of people to focus on value.
Finance wants systems that deliver the information required to support good decisions. Not only do they improve the decisions that are made, they enable us to explain the process and variables behind those decisions to the people and teams affected. In fact, despite what you may have heard, finance wants to say “yes.” We really do. But first we need choices presented to us in a structure that represents the relative benefits, costs and risks associated with each option. As long as collaboration leads us to that point, finance is all in.
This concludes our CFO blog series. If you missed any, you can access them here:
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