Finance teams are often looked to for leadership of cross-functional projects. This is often the case because the ultimate project results can be measured by, or affect, financials. A budget or re-forecast process is a clear example of a cross-functional project led by Finance. From our experience in leading cross-functional projects as part of Finance teams, we believe a few factors are key to the success of these projects.
Factor #1: Alignment to Goals
Different functions may have conflicting goals, which can make achieving the overall project difficult. For example, Operations may strive for low inventory, while Sales may prefer to have higher inventory (to address unexpected customer needs). Marketing may prefer flexible and undefined campaign spending (e.g., TV, web, other ads), while Finance may prefer to have defined and controlled spending.
In both examples, a good Finance project management effort will identify common project goals between these competing objectives. Operations teams should be positively inclined to more predictable and stable inventory ordering, which could align with Sales teams’ demand forecasts built by-customer. Marketing teams may be able to secure higher campaign budgets if they develop a more defined budget, which a Finance team will be more likely to sign off on. Looking for such ways to align goals by utilizing a Finance skillset to achieve overall project objectives can be beneficial to the company overall.
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Factor #2: Cross-Functional Project Planning
A list of actions that need to be completed by specific functional team owners by a certain date should be developed. A project plan will allow participants to see how their efforts contribute to (or hold up) progress within expected timeframes, especially if other functional teams depend on a preceding milestone to move forward. With these cross-functional considerations, Finance teams can leverage their experience with budget and re-forecast processes. In those cases, Finance often requests that the Sales team deliver a revenue estimate by a certain date, so Marketing and other teams can then develop informed cost forecasts before consolidating a P&L for executive team review.
Want to learn more about planning? Check out our blog post: “Be Prepared: Business Continuity Planning“
Factor #3: Dollarize Proposed Actions
One way the Finance team can help move cross-functional projects forward is to utilize its knowledge to dollarize proposed actions. This can persuade teams that are lagging, or not fully grasping the magnitude of their actions, to put them in perspective. This can also help improve the working relationships the Finance team has for other future collaborations.
Factor #4: Finance Leadership Sponsorship
As with any project, sponsorship from leadership is always useful. If project goals ultimately have financial benefits such as improved profitability or stronger cash flow, obtaining sponsorship from the CFO or other finance leaders could be a helpful addition. Finance leaders attending some regular check-in meetings and calls with all teams should keep teams motivated to deliver on their tasks. Finance leaders who make themselves available to resolve any escalated conflicts can be helpful (if applicable) as well.
Factor #5: Cross-Functional Project Experience
If you are looking for help with Finance-led cross-functional project management, or if you are thinking about bringing in financial consultants, then contact 8020 Consulting! We offer outside expertise with industry best practices and would be happy to help you define your needs and offer advice on next steps.
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About the Author
Marco has 17 years of Finance and Consulting experience. His work spans various industries including technology, entertainment, telecommunications, consumer products, financial services, and healthcare. Marco has expertise in Financial Planning & Analysis (budgeting, forecasting, and reporting), Strategic Planning, project management, financial modeling, merger integration, and valuation. Prior to joining 8020 Consulting, Marco held Finance and Strategy positions at Epson America and also worked for various firms including Deloitte Consulting, Paramount Pictures, Grupo Modelo, Cricket Communications, UBS, and Goldman Sachs. Marco holds a B.A. in Economics from Brandeis University, and an MBA from the UCLA Anderson School of Management.