The time for strong and wise financial leadership is now. UK recruiters are seeking FD candidates with broad commercial knowledge, as Matt Weston explains.
Everyone turns to finance in challenging times. We have seen that in a number of downturns over the years, particularly in the financial crisis of 2009/10. So the need for the finance department to have commercial intelligence has never been bigger. It is essential that it adds value, and is not just a number cruncher.
The regulatory and technical accounting aspects of the job are still very important, but nowadays you must add to that the need for commercial acumen, knowledge of business partnering and the ability to work with people.
One of the most important aspects of the evolution of the finance role in business has been the need to get to understand and exploit big data, particularly in the evolution of enterprise resource planning (ERP) systems. The ability for a finance professional to analyse, plan and price is critical.
We are seeing more digitalisation of routine functions and automation of the repetitive tasks of the finance function.
A finance director needs strong interpersonal skills. Also, experience with commercial projects will put a candidate at an advantage when applying for a finance position. The ability to take a set of numbers and explain them to colleagues in the business is also vital.
There is much discussion at present about the future of work - including the use of remote working and virtual meetings. Finance is part of this debate and we have seen that technology is enabling hiring on a national basis rather than local.
The amount of interviewing and ‘onboarding’ that has taken place remotely, without a candidate ever meeting the employer directly, has been sharply increasing. In fact, the number of roles that have been taken on ‘virtually’ is remarkable. We expect that, when things settle down, there will be more of a hybrid situation, with both direct and virtual contact being important in the recruitment process.
Most companies that we know are adopting an approach of full support for people who want to work from home – they want their employees to be as comfortable as possible. The issue really is not so much how people ‘work’ from home as how they ‘perform’ at home.
The finance director whose team is working from home will need to check in with them on a regular basis. Companies will have a duty to pay attention not just to the physical, but also the mental health of their employees. It can be technically efficient but also quite lonely for some people to work at home.
Why commercial acumen matters
Commercial acumen can go by many names, including business savvy or commercial awareness. They all describe the same qualities – a strong understanding of the business world and an organisation’s market and environment, backed by a ready grasp of what the company needs to do to succeed.
Commercial acumen is about know-how. Candidates who have it will understand how markets work, have insights into the trends or technology that are reshaping markets, and can identify how a company can tap into these trends to streamline performance, grow market share and outperform the competition.
For finance professionals, this means being financially literate and being able to read financial statements. It involves recognising how different actions or strategies can impact a company’s profitability and cash flow.
At the core of this is being able to look beyond your immediate role or department and take a big picture view of the organisation, while still aligning that view with the company’s strategy and values.
An intimate understanding of how markets work allows professionals to recognise opportunities for the company to explore new markets, work with changing legislation, or simply become more profitable. Understandably, these are all qualities that are highly sought after by employers.
Demonstrating your knowledge
It’s one thing to have commercial acumen, but you also need to be able to showcase it to hiring managers. And that starts with having a strong understanding of the organisation that you are applying to work for.
The internet is a useful tool to learn about the structure of the organisation, what it does, who its customers are and the industry or sector it operates in. It can also help you research wider issues that may affect the company and its market – on a local, national and even global scale.
A company’s website is just one port of call. Make a habit of reviewing news sites to discover any issues or challenges the organisation faces. At a minimum, take the time to research who the company’s customers are, any threats it is coming up against – such as technological advances, shifting customer preferences, environmental and sustainability issues – or any economic factors that could impact the organisation and its market.
This research will be valuable in your conversations with a hiring manager, allowing you to stand out from other candidates by delivering responses tailored to the company rather than providing generic answers.
As commercial acumen is often built up through experience, when you come face to face with a hiring manager, refer to your involvement in different projects. This can demonstrate your understanding of the business world, while also allowing the hiring manager see that you take new learnings from every on-the-job engagement.
Be prepared to also provide practical examples of times when you have shown your commercial acumen in a real setting. This could be an innovation you suggested; however, back it up with firm results such as a 10% return on investment or a 5% reduction in costs.
Improving your skills
If you are just starting out in your career, or you feel your commercial knowledge isn’t up to scratch, the good news is that there are steps you can take to develop your business savvy.
First and foremost, stay abreast with the financial press and current affairs. It’s a low-cost way to familiarise yourself with the wider business community, and gain an understanding of the current economic climate and how it is impacting different businesses.
Importantly, think about what you have learned from your previous job experience. It’s easy to get caught up with the day-to-day micro matters of a role, but true commercial acumen means being able to see how small steps taken by one department can impact the company more broadly.
It can also help to connect with a mentor. Many professional associations can put you in touch with a mentor, and it can be a great way to leverage the skills and experience of a more seasoned professional in your field.
Commercial acumen will never go to waste. By taking the time to develop your knowledge, you have a better chance of securing the role you want, and enjoying long-term success in your chosen career.
About the author
Matt Weston is a UK director
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