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  • Pam Prior

The Secret Ingredient of High-Performing Finance Teams

Some time ago, I was hired as the CFO of a company with about 200 employees, 12 of whom were on the finance team.

When I got there, the executive leadership team believed they had a litany of “issues” with the finance team:

  1. They didn’t deliver reports on time

  2. The information they provided was inconsistent

  3. The reporting was unreliable

On my first day there, I noticed right off the bat that the finance team was sequestered in a back room of the office. LITERALLY the back room! No windows, and a long corridor between their offices and the rest of the company employees. They were completely isolated from the rest of the business.

This physical isolation was the perfect metaphor for how the company and the finance team interacted; in fact, it ensured its complete disconnection from the business as a whole, the leadership team, and the company strategy and mission.

Clearly, that was a major problem. The finance team was essentially acting as its own independent entity. They were creating processes and generating reports for a business that didn’t include them in its inner circle. The leadership didn’t understand what they did or how they were generating their reports, which is why they felt they were inconsistent and unreliable; and the cycle of misunderstanding was self-perpetuating.

As you can imagine, the problem wasn’t with the finance team; and the problem wasn’t with leadership. The problem was in the bridge between the two. There was no relationship on which to build; no shared experiences over which to bond; and no communication through which to align with each other.

The Secret Ingredient of High-Performing Teams

What’s the secret ingredient of high-performing finance teams? Any kind of team?

It’s trust.

The leadership in my new company was unhappy because they felt the finance team was inconsistent. The finance team was unhappy because they felt misunderstood and devalued. There was a complete breakdown of trust between the parts of the organization that needed the financial information and the part of the organization that was producing the financial information. Frustration built up on both sides, and when I came into the picture, the situation had grown into a breakdown of trust.

Trust is absolutely required for any high-performing team. Trust is the key, the secret ingredient, the special sauce — and it’s required to inspire the highest engagement and the best work.

And trust needs an environment in which it can grow and thrive.

Building Trust

As a result of the mistrust, the situation at this company was completely dysfunctional. And the interactions between functions reflected that – in late reports, in inconsistent reports, in incorrect reports, and in irrelevant reports.

We needed to start at the top. Finance needed to be a vibrant and active participant at the leadership table. It needed a strong representative who would ensure that the mission of the company was conveyed to the finance team; and the finance team’s role and abilities and constraints were conveyed at the leadership table. We started there.

Then it was time to start integrating the finance team into the business in a more meaningful way. It was time to move out of the back room and begin interacting with the rest of the company on a daily basis. The difference that move made was extraordinary. We became more involved with strategic planning, and the team had more visibility in key meetings so began to understand the overall picture of what was going on and how it related to their job functions. A groundwork for mutual appreciation was under construction.

Then we began a process to evaluate the financial processes within the business and how they could be improved. Involving the team members deeply in that process brought a new sense of purpose. Someone was listening! Someone recognized when tools were outdated, and workarounds cumbersome, and most importantly, someone recognized that the people on the front line were the people with the best ideas for improving things.

Why hadn’t this happened before? Everyone was busy! The CEO didn’t have a strong enough relationship to sit down with the finance team and figure out exactly what they did or how they did it. The finance team didn’t know enough about how its outputs were used to suggest that there might be more effective ways to do things.

In short there was no communication.

Trust in Action

Small wins! One way to engender trust in an organization is to ensure small wins that always move people’s perceptions of each other forward – towards alignment. The small wins build a foundation.

From there it is time to lay out the larger vision. Initially, in that organization, as with many companies, the finance and accounting team was spending about 90% of its time in transaction processing, and only 10% in value-adding analysis. Committing to the finance team with some investment allowed the group to participate in identifying and implementing changes that started to tip this scale. First of all, the team felt valued for the first time in a long time; investments, instead of Band-Aids were being applied for the first time in many years.

It didn’t matter that the investments weren’t huge – the message was still there: what you do matters and is a priority.

The next benefit was that the reporting itself. As a result of being more aligned with the strategy and some real attention and investment, reporting was now heading rapidly towards earning the characteristics of timely, reliable, and consistent.

This shift made the finance team feel more valued. The impact of that value was that the team felt a much higher sense of ownership in its product. More ideas flowed to improve further, and the perception of the team’s value increased accordingly. The downward spiral of dysfunction was now an upward spiral of trust.

And on the flip side, the CEO now had more trust in the finance team. Numbers came faster, made sense, and stood up to questions.

How Does This Apply to Your Business?

The essence of this story applies to companies of all sizes — whether one, ten, 1,000, or 10,000 employees. Building trust and fostering the relationships between your finance team and the rest of your organization is crucial; it’s a secret ingredient for success.

If you want to build trust with and inspire a top performance from your finance team, whether internal or outsourced, some suggestions include:

  1. Foster communication between finance and the rest of your organization; the more involved finance is in strategy and operations, the better they can interpret, integrate, and align reporting with your needs.

  2. Increase the value and ownership team members feel for their job; if your finance team is exclusively crunching numbers, they can will feel disconnected and devalued.

  3. Create an atmosphere of open and respectful communication; the more you encourage your finance team to contribute their thoughts and ideas, the more they will (and the more they’ll trust you in the process).

  4. Set high expectations: once that finance team is involved in your strategy, at the table, and integrated into the business – set the bar high, and watch the members exceed it.

When you foster the trust and relationship between the finance team and the rest of your organization, everyone wins. And you’ll see your finance team grow into a high-performance dream team in no time.

Author, Virtual CFO, and Finance Coach

"Your First CFO: The Accounting Cure for Small Business Owners" on AMAZON.

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