Design Thinking Method for The Finance Business Partner - The Five Whys

Design Thinking Method for The Finance Business Partner - The Five Whys

By Christopher Andrew Heathcote, Customer Success Consultant at Bedford Consulting​

What is a Finance Business Partner?

A finance business partner acts as the bridge between the wider business and the financial leadership of the organisation. They work to unite the needs and demands of the group with those of the business with whom they partner, translating the financial strategy into a story they are able to identify and empathize with. They guide their business partners through the various financial constraints and perceived barriers to ensure their business units effectively and efficiently meet their strategic objectives. 

What is Design Thinking?

Design thinking is a creative and practical approach to problem solving. It involves the creation of multiple options which are then scrutinised through varying viewpoints and lenses to determine the most effective solution. Design thinking is employed solely for the purpose of creating solutions which have yet to be formed, from designing the aesthetics of a new product to the internal workings of a jet engine or designer watch. At its core is a deep appreciation and understanding of the people who will be interacting with the solution and a desire to meet their needs as fully as possible.

The Finance Business Partner and Design Thinking?

Finance business partners are problem solvers. They exist to help their businesses move forward towards a future which not only meets the demands and expectations of the wider business but also the needs of those whose job it is to realise that strategic vision. That is no mean feat.

The role of the finance business partner is well established. The associated change in expectations away from the transactional and advisor role to one in which they are expected to operate alongside the business and provide proactive solutions demands that they adopt a new approach.

Design thinking offers a suite of tools which will allow this new finance role the opportunity to step up and become a true partner. It is inherently flexible and cyclical yet potential solutions must run the gauntlet of financial and operational scrutiny before it is taken forward. Such flexibility enables its practitioners to keep calm in times of uncertainty, confident that if a solution is not quite right they have done their homework and have a number of alternatives to fall back on. Its focus on creating solutions which empathize with their users and which centers on meeting the human and business need ensures they are more effectively integrated into to the cultural make-up of the organisation. This, in turn, reduces the risk of change failure while ensuring the organisation succeeds in moving measurably closer to meeting its overall strategic objectives.

The finance business partner is a finance professional which has succeeded in becoming viewed as a proactive provider of solutions to some of the most strategically relevant problems. Such a shift in expectations has raised the need to approach such problems from a perspective in which creativity, empathy and foresight are combined with financial and analytical thinking to create solutions which meet the needs of the full range of stakeholders.

The Five Whys

I would like to highlight key methods and to describe how each can be used to enhance the skill sets of current and aspiring finance business partners.

Design led tools and methods enable a practitioner to get to the core of the problem. They allow the user to uncover the truth. It is from this perspective the finance business partner can then begin to explore possible solutions.

The five whys is a very simple tool. The underlying reasons for the emergence of any given scenario will involve multiple layers of elaboration. Armed with this understanding the five whys method involves asking the stakeholders within our organisations and the final users of our solutions five whys with the aim of gaining additional insight after each explanation.

The power of this tool comes from its simplicity. Leaders do not have the time or patience to elaborate on what they need. They expect the finance business partner to anticipate the intricacies and nuances of the organisation in order to deliver an effective solution. This method ensures that the finance business partner does not take anything at face value but proactively seeks out insights which may not be immediately apparent after the early rounds of enquiry.

It encourages inter-organisational collaboration as each layer of questioning brings the need to involve other connected stakeholders into the process.

For example, a need to understand profitability from a commercial director will involve investigating a number of factors.

Why is profit lower than expected?
The revenue per unit is lower than planned.

Why is revenue per unit lower than expected?
Discount in that category is higher than planned.

Why is discount so much higher than expected?
Group commercial have applied a sale promotion in addition to the market team resulting in a number of products being heavily discounted.

Why are products being discounted at a group level and a market level? A large number of slow-moving lines have been discounted centrally to enable clearance of stock which the market team was not aware of?

Why are these products not selling through at the rate of sale that the organisation has forecasted? Demand for these products is not as strong as expected.

The example above is a case in which the risk in the decreasing margin came about as a result of the decisions of a different team within the organisation. However, this insight was not uncovered until the third iteration. If this method had not been followed the risk of getting stuck in the detail of answering the first and second whys and becoming preoccupied with seeking out a solution to mitigating this risk at this level would have taken far longer than that which came about by delving a little deeper and wider.

The market team in this example have little influence over the decision making at the group level. However, they have the power to control the promotional planning with their market. The solution here was beautifully simple. By building relationships with the central commercial teams the market was able to get forewarning of group promotional planning. Armed with this knowledge they were then able to amend their own planning to ensure that they did not apply discounts on top of those products group were try to move through the central stores. This restored the profitability and the risk to the margin was mitigated.

This example illustrates that many problems within an organisation require a deeper level of questioning in order to uncover the underlying cause. However, once the layers are revealed the solution can often be beautifully simple.

Good design seeks out simplicity in its solutions and this should be how the finance business partner approaches their decision making processes.

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