How to bridge the gap between finance and operations.
In many small and medium-sized enterprises (SMEs), finance and operations often function in silos: one is focused on the numbers, and the other on day-to-day delivery. But if the business is to truly thrive, these two core functions must work in harmony.
Bridging the communication gap between finance and operations can unlock better decision-making, increase efficiency, and drive alignment with business goals. Here’s how to do it well.
Align finance and operations
At its core, strong communication between finance and operations ensures that everyone is pulling in the same direction.
Operational decisions, whether they are related to staffing, production, supply chains, or something else entirely all have financial implications.
If the two departments aren’t on the same page, you’ll risk going over budget, misallocating your resources, and missing your targets entirely.
Fostering regular dialogue between the two teams is the only way to ensure that operational strategies are grounded in financial reality. Your finance teams can help interpret data and forecast outcomes, while your operations teams can provide critical insight into on-the-ground challenges and opportunities. Together, they can form a more accurate picture of your business’s performance and help you tackle obstacles cleverly and with more confidence.
Consider finance as a strategic partner
You may need to change how you view your finance function. Rather than seeing finance purely as a back-office compliance role, you should be recognising it as a way of supporting your plans for growth.
Remember, your finance teams can offer more than just reports. They can provide insights that shape your strategy, better manage risk, and drive increased profitability.
Schedule regular financial updates
One practical way to bridge the financeoperations gap is by introducing regular communication cycles.
Monthly or bi-weekly financial update meetings can keep you and your department heads informed of the company’s financial position, allowing for timely adjustments and much more proactive management decisions.
These sessions should go beyond dry financial statements. Focus on tracking key performance indicators (KPIs), defining trends, and exploring how financial results relate to operational activities.
Encouraging questions and open dialogue will make sure all teams feel engaged and accountable, too.
Train non-financial staff
Consider providing financial literacy training to non-finance staff. Operational managers don’t need to become accountants, but they should understand basic concepts such as profit margins, cash flow, and budgeting. This empowers them to make informed decisions and engage more meaningfully in financial discussions.
Simple workshops or short e-learning modules can demystify finance and build confidence across the business. When more team members understand the numbers, it naturally improves the quality of cross-functional communication and helps to keep everyone working towards the same outcome.
Use technology to support your vision
With the right technology, everyone from the sales staff to the boardroom execs can get the financial information they need, precisely when they need it.
Shared dashboards, such as those built in tools like Xero or Power BI, offer real-time visibility into financial and operational metrics. Collaboration platforms like Slack, Microsoft Teams or Asana can further streamline communication and make updates accessible to everyone.
By aligning goals, fostering mutual understanding, and leveraging the right tools and processes, you really can turn these traditionally separate functions into a united force.
If you need help boosting inter-team communications or improving your staff’s understanding of your financial position, contact me, Mark Brown at L4 Financial.
Mark@L4Financial.co.uk
L4Financial.co.uk
07960 031554