If you were to examine a company’s culture and inquire about the actual responsibilities of each department, you would discover the well-known distinction between “front office” and “back office” operations.
Front office staff are individuals who manage clients. Depending on how involved the marketing department is in the sales cycle, they might be the customer service department, the sales department, or both. Typically, administrative assistants, HR, and the Finance department—the worst part of any business—make up the back office staff.
I’ve observed that finance departments frequently face silent derision or disrespect in businesses. The front office staff, who believe their jobs are more challenging than those in finance, which deal with numbers, contribute to this attitude of “us versus them.” Even though it may appear as though the back office is constantly sending memos to the front office requesting that they “watch this expenditure” or “spend less on client lunches,” no one from the front office sends memos to the back office requesting that they “please spend less time crunching the numbers.”
Sadly, this viewpoint is supported by management at all levels, who assign Finance the unpleasant tasks of accounts receivable, accounts payable, and budget forecasting. Finance is like the broccoli side dish on a steak and fries plate when compared to the highly creative marketing department and the edge-of-the-seat, in-the-trenches sales department.
However, this need not be the case! In the hope that their sharp pencils won’t poke a customer in the eye, finance departments shouldn’t be relegated to the back office! The organization’s finance departments can and should play a much larger role. Here are a few concepts:
One Possibility: Instead of counting numbers, finance ought to be more about business strategy. Their function is reduced to that of a mere numerical interpreter when the Finance department pressures sales managers to submit budgets and then uses those budgets as the final target budget for the year. However, what if Finance met with sales and discussed how their numbers related to anticipated outcomes? Then, what if Finance met with the company’s executives to actually devise a forecast based on what the market was anticipating? Imagine a world in which the numbers used by Finance were more than just a spreadsheet that is pulled out at every quarterly review.
2nd Possibility: Opportunity ought to be the focus of finance more. A lot of sales managers only have a limited view of which clients are bringing in business. However, not every view is perfect. or entirely. To demonstrate how a customer actually affects the bottom line, finance should intervene. If Finance and Sales talked to each other, Sales might be surprised to learn that their biggest client is actually worth less than they thought because it takes a lot of work to keep them as a client. Or, they might learn that a client that seems to be profitable isn’t profitable at all because their receivables are getting very, very old. Imagine a world in which the Finance department is able to tell Sales which opportunities are actually the most profitable by connecting relevant information that has an actual impact on the business.
3. A POSSIBILITY: It would be ideal for money to sell, as well. When Finance handles accounts receivables follow-up, they may cause more harm than good. Finance employees may be good “people-oriented” employees and have excellent numerical skills, but they rarely receive sales training. However, if a Finance employee in charge of accounts receivable receives adequate training in sales, customer service, and receivables, not only will they be more successful at acquiring additional business but also in getting the receivables paid.
There are numerous additional opportunities as well. Prospecting lists should be used with accounts payable lists by businesses. For brief “see-how-the-other-side-does-it” days, they should switch roles between Finance and Sales to gain new appreciation and connections. Finance should observe sales calls to learn why Sales thinks they have to bend the rules in order to close the deal. Sales should also observe Finance’s work so they know what needs to be done at the back end if they don’t adequately assess risk during the sale.
A closed-off Finance department should not determine a company’s bottom line. Instead, if a company makes its finance department an integral part of the business as a whole, it can find exciting new opportunities.
