Are you missing out on a key strategic partnership?

Are you missing out on a key strategic partnership?

As HR and reward leaders, we tend to talk a lot about relationships with the business, and gaining a seat at the strategic table. I’ve found, however, that in some businesses this tends to focus on the CEO and the operational functions, forgetting a team with the potential to be a key ally – Finance. While nominally another “support” function, Finance never seem to worry about their place at the top table, which suggests to me that we could learn from them and benefit from closer engagement.

From my experience both in-house and as a consultant, the finance-reward partnership can be a powerful relationship – or very limited one – and I’ve sought feedback from finance leaders to understand where they see key challenges. Recognising that the finance team is a key stakeholder in any employee reward programme, this may shed some light on opportunities to open a dialogue.

Unsurprisingly, the finance leaders who responded generally had a good relationship with their reward team (bonus number one – a good relationship means they respond to your queries!) although over half of them could only get the information they needed from reward some of the time. So, there’s a great place to begin, talk to your finance team to understand what information they need and in what format. The beauty of this conversation is it may also open up additional information for you, as well as a fresh insight into how the business thinks about people costs.

I also asked about the areas of employee reward that cause the most challenges for Finance; the top five are highlighted in the graph to the left. The finance team is called on to do a lot of forecasting work, including people costs and hiring, and we can help ensure they are providing an accurate picture. Moreover, engaging with Finance when designing any new programme can help to avoid unexpected pitfalls, meaning that things operate more smoothly; this can also highlight issues around timing or compliance that may not be front of mind for a reward leader, making both of your jobs easier and enhancing your credibility with the organisation.

Another key theme to emerge from the feedback was around line manager understanding; it seems finance teams also benefit when we ensure line managers understand, buy into, and consistently apply reward programmes. Inconsistent application by managers, or disengagement, can undermine the value of any programme and exception or change requests cause Finance as much headache as Reward. Of course, this means we need to ensure we provide managers with a clear framework and guidelines to ensure they can be consistent in their approach.

Overall, the message that came back to me is that Finance is keen to have an open an ongoing dialogue with Reward. Establishing meetings at key times – and creating the habit of regular conversation – is a great way to ensure everyone has the opportunity to understand and comment on plans long before implementation, managing out risks and surprises. In my experience, an open and two-way relationship with the finance team is a powerful enabler of even better reward programmes.